July 19, 2013
VIA EDGAR SUBMISSION
U.S. Securities and Exchange Commission
Division of Corporation Finance
100 F Street NE
Washington, D.C. 20549
Attn.: | David R. Humphrey |
| Accounting Branch Chief |
Re: | Good Sam Enterprises, LLC |
| Form 10-K for the Fiscal Year Ended December 31, 2012 |
| Filed March 15, 2013 |
| Form 10-Q for the Quarterly Period Ended March 31, 2013 |
| Filed May 14, 2013 |
| File No. 0-22852 |
Dear Mr. Humphrey,
We have received your letter dated July 18, 2013 (“Comment Letter”) regarding the Good Sam Enterprises, LLC (the “Company” or “we”) Annual Report on Form 10-K for the fiscal year ended December 31, 2012 and our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2013. The following are our responses.
For your convenience, the numbered paragraph set forth below corresponds to the paragraph of your Comment Letter. Your comment is repeated in bold type below and our response follows in ordinary type.
Form 10-Q for the Quarterly Period Ended March 31, 2013
Note 3. Statements of Cash Flows, page 6
1. We note you recorded $1.8 million as a gain on the sale of certain publications and assets that were included in the previous Membership Services-Media business segment, and have reflected the gain as non-operating income. Please explain why the gain is not included in operating income pursuant to ASC Topic 360-10-45-5.
Good Sam Enterprises
2575 Vista Del Mar Drive, Ventura, California 93001
805.667.4100 ▪ Fax 805.667.4431
U.S. Securities and Exchange Commission
Division of Corporation Finance
July 19, 2013
Response: The Company recorded the $1.8 million gain on the sale of certain publications and assets related to the previous Membership Services-Media business segment as non-operating income rather than operating income for the following reasons:
· Management determined that the amount involved was not material to our shareholder, bondholders or prospective bondholders. The $1.8 million gain amounts to <4% of operating profit and non-operating profit on an annualized basis.
· Given that the amount is not considered material, Management believes that this presentation is more meaningful to the main users of the financial statements, its shareholder, bondholders and prospective bondholders, who are focused on operating income without taking into account one-off sales of assets.
· Management determined that reflecting the amount as a separate line item in the financial statements, together with the accompanying disclosures in the footnotes to the financial statements regarding the nature of the gain, was transparent to the Company’s shareholder, bondholders and prospective bondholders.
In future filings, the Company will classify any material gains or losses on sales of assets as an item of operating income pursuant to ASC Topic 360-10-45-5.
As requested by the Staff, the Company hereby acknowledges that:
· The Company is responsible for the adequacy and accuracy of the disclosure in the filing;
· Staff comments or changes to disclosure in response to Staff comments do not foreclose the Commission from taking any action with respect to the filing; and
· The Company may not assert Staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
Good Sam Enterprises
2575 Vista Del Mar Drive, Ventura, California 93001
805.667.4100 ▪ Fax 805.667.4431
U.S. Securities and Exchange Commission
Division of Corporation Finance
July 19, 2013
Please call me at (805) 667-4457 if you need any other information or would like to discuss the above response. Thank you for your consideration.
|
| Sincerely, | |
|
| GOOD SAM ENTERPRISES, LLC | |
|
|
| |
|
| /s/ Thomas F. Wolfe |
|
|
| Thomas F. Wolfe | |
|
| Chief Financial Officer | |
Cc: | Todd Wolpert, Ernst & Young LLP |
| Brent Moody, Good Sam Enterprises, LLC, Executive Vice President and Chief Administrative and Legal Officer |
Good Sam Enterprises
2575 Vista Del Mar Drive, Ventura, California 93001
805.667.4100 ▪ Fax 805.667.4431