<SEC-DOCUMENT>0000900075-17-000003.txt : 20170314
<SEC-HEADER>0000900075-17-000003.hdr.sgml : 20170314
<ACCEPTANCE-DATETIME>20170207161601
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0000900075-17-000003
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20170207

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			COPART INC
		CENTRAL INDEX KEY:			0000900075
		STANDARD INDUSTRIAL CLASSIFICATION:	RETAIL-AUTO DEALERS & GASOLINE STATIONS [5500]
		IRS NUMBER:				942867490
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0731

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		14185 DALLAS PARKWAY
		STREET 2:		SUITE 300
		CITY:			DALLAS
		STATE:			TX
		ZIP:			75254
		BUSINESS PHONE:		972-391-5000

	MAIL ADDRESS:	
		STREET 1:		14185 DALLAS PARKWAY
		STREET 2:		SUITE 300
		CITY:			DALLAS
		STATE:			TX
		ZIP:			75254
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.htm
<TEXT>
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<div><a name="s215434F1C7834E40BB4D058334CB1154"></a></div><div></div><div><br></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">February 7, 2017</font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">Mr.&#160;William H. Thompson</font></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">Securities and Exchange Commission</font></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">100 F Street NE</font></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">Mail Stop 33561 <br>Washington, D.C. 20549</font></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:130%;text-align:left;padding-left:30px;text-indent:-31px;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-weight:bold;">Re:  Correspondence from you dated January 27, 2017 concerning Copart, Inc. </font></div><div style="line-height:130%;text-align:left;padding-left:30px;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-weight:bold;">Form 10-K for the Fiscal Year Ended July 31, 2016</font></div><div style="line-height:130%;text-align:left;padding-left:30px;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-weight:bold;">Filed September 28, 2016</font></div><div style="line-height:130%;text-align:left;padding-left:30px;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">Ladies and Gentlemen:</font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">&#160;</font></div><div style="line-height:130%;text-align:left;text-indent:48px;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">On behalf of Copart, Inc. (&#8220;Copart&#8221; or the &#8220;Company&#8221;) this letter is being transmitted in response to comments received from the staff (the &#8220;Staff&#8221;) of the Securities and Exchange Commission (the &#8220;Commission&#8221;) by letter dated January 27, 2017 with respect to the Company&#8217;s Annual Report on Form&#160;10-K for the fiscal year ended July 31, 2016, filed on September 28, 2016. &#160;The numbering of the paragraphs below corresponds to the numbering of the comments which, for the Staff&#8217;s convenience, we have incorporated into this response letter.</font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-style:italic;text-decoration:underline;">Form 10-K for the Fiscal Year Ended July 31, 2016</font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-style:italic;text-decoration:underline;">Item 7. Management&#8217;s Discussion and Analysis of Financial Condition and Results of Operations</font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-style:italic;text-decoration:underline;">Critical Accounting Policies and Estimates</font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-style:italic;text-decoration:underline;">Valuation of Goodwill, page 45</font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:130%;font-size:11pt;padding-left:0px;"><font style="font-family:inherit;font-size:11pt;font-style:italic;font-weight:bold;">1.</font></div></td><td style="vertical-align:top;"><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-style:italic;font-weight:bold;">We note your risk factor disclosure on page 23 that testing goodwill requires management to make significant estimates and assumptions. Given the significance of goodwill to your financial position, please expand your disclosure to discuss the degree of uncertainty associated with key assumptions underlying the fair value estimates used in your impairment testing that have the reasonable possibility of changing and could lead to a material goodwill impairment charge in the future. In the case of material uncertainties associated with a potential goodwill impairment charge, please also disclose the percentage by which fair value exceeded carrying value. Refer to Item 303(a)(3)(ii) of Regulation S-K and SEC Release No. 34-48960 available on our website at www.sec.gov. </font></div></td></tr></table><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:130%;text-align:left;text-indent:48px;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">In response to the Staff&#8217;s comments, the Company will include additional disclosures in its future filings concerning (i) the degree of uncertainty associated with key assumptions underlying the fair value estimates used in the Company&#8217;s impairment testing that have the reasonable possibility of changing and could lead to a material goodwill impairment charge in the future, and (ii) the percentage by which fair value exceeded carrying value, in the case of material uncertainties associated with a potential goodwill impairment charge.</font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div><br></div><div style="text-align:center;"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1</font></div></div><hr style="page-break-after:always"><div></div><div><br></div><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-style:italic;text-decoration:underline;">Note 8 &#8211; Long Term Debt, page 76</font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:0px;"><font style="font-family:inherit;font-size:11pt;font-style:italic;font-weight:bold;">2. </font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-style:italic;font-weight:bold;">We note your disclosure in the third paragraph on page 27 that alternative potential uses of your cash balances and cash flows from operations may include the payment of dividends, among other things. We also note your Credit Agreement and Notes Purchase Agreement contain covenants that limit your ability to pay dividends. Please describe in future filings the most significant restrictions on the payment of dividends, their pertinent provisions, and the amount of retained earnings or net income restricted or free of restrictions. Refer to Regulation S-X 4-08(e)(1). </font></div></td></tr></table><div style="line-height:130%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:130%;text-align:left;text-indent:48px;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">In response to the Staff&#8217;s comments, the Company will include additional disclosures in its future filings concerning the most significant restrictions on the payment of dividends, their pertinent provisions, and the amount of retained earnings or net income restricted or free of restrictions.  &#160;</font></div><div style="line-height:130%;padding-top:1px;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:130%;padding-bottom:12px;text-align:left;text-indent:48px;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">Please contact the undersigned at (972) 391-5025 with any questions regarding the above.</font></div><div style="line-height:130%;padding-bottom:10px;text-align:center;font-size:11pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="2"></td></tr><tr><td style="width:55%;"></td><td style="width:45%;"></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">Sincerely,</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">/s/ Jeffrey Liaw</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">Jeffrey Liaw</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">Senior Vice President and Chief Financial Officer</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">Chief Financial Officer</font></div></td></tr></table></div></div><div style="line-height:130%;padding-bottom:10px;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div><br></div><div style="text-align:center;"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">2</font></div></div>	</body>
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