````````` January 14, 2005
Mail Stop 0305
Hilary A. Rapkin, Esq.
Vice President and General Counsel
Wright Express Corporation
97 Darling Avenue
South Portland, Maine 04106
Re: Wright Express Corporation
Form S-1 filed January 3, 2004, as amended
File No. 333-120679
Dear Ms. Rapkin:
We have reviewed your amended filing and have the following
comments. Where indicated, we think you should revise your
document
in response to these comments. If you disagree, we will consider
your explanation as to why our comment is inapplicable or a
revision
is unnecessary. Please be as detailed as necessary in your
explanation. In some of our comments, we may ask you to provide
us
with supplemental information so we may better understand your
disclosure. After reviewing this information, we may or may not
raise additional comments.
The purpose of our review process is to assist you in your
compliance with the applicable disclosure requirements and to
enhance
the overall disclosure in your filing. We look forward to working
with you in these respects and welcome any questions you may have
about our comments or any other aspect of our review. Feel free
to
call us at the telephone numbers listed at the end of this letter.
``Table of Contents
1. We note your response to prior comment 7; however, this
additional
disclosure should be relocated to the summary section and does not
belong on the table of contents page. We suggest, for example,
including it within the "Corporate information" summary subsection
on
page 6.
``Summary combined financial information, page 9
2. We note your response to our prior comment number 14 and the
changes that have been made to your summary combined financial
information in response to our prior comments. Please revise to
clarify through footnote or other disclosures that total
Mastercard
purchase volume reflects the dollar value of Mastercard purchase
transactions processed by you on behalf of your customers. The
disclosure of this measure on page 28 in your Selected historical
combined financial data and on page 36 should be similarly
revised.
Dividend Policy, page 24
3. We note your response to comment 23 that you are in the process
of
negotiating the terms of the new credit agreement and any material
terms, including restrictions on the payment of dividends, will be
disclosed in a subsequent amendment. Please ensure that this
information is included in the amendment following the
finalization
of this agreement.
Notes to Unaudited Pro forma Combined Financial Statements, page
33
4. We note from your response to comment 25 that you have
clarified
the disclosure concerning the assumptions in Note 8 on page 34.
When
the tax receivable adjustment is included on the pro forma
statements, please revise your disclosure to explain the
significant
assumptions used in arriving at the proforma adjustment amount.
5. We note from your response to comment 26 that Note 1 clarifies
that the cost of services provided by Cendant have been deducted
from
the adjusted pro forma financial statements and that the
adjustments
are disclosed in the table on page 48. Please supplementally tell
us
the reason for the significant difference between the estimated
incremental support costs for the first 12-month period following
the
offering, disclosed on page 48 of $3,591, and the amount included
on
the pro forma statement of income for the year ended December 31,
2003 of $4,276.
6. Refer to footnote (1) - We note that footnote (1) has been
referenced to several of the adjustments in your pro forma
statements
of income including adjustments to salary and other personnel
costs,
service fees and other expenses. However, based on the
disclosures
which have been provided in footnote (1) to your statements of
operations, we are unable to determine the specific nature of the
costs comprising each adjustment, how they were determined, or why
management believes each adjustment is factually supportable.
Therefore, please revise the notes to your financial statements to
disclose the nature and amounts of the costs comprising each
adjustment in your pro forma statements of income and disclose the
significant assumptions used to calculate or determine these
adjustments. Also, please explain supplementally why you believe
each
adjustment is factually supportable. We may have further comment
upon
receipt of your response.
7. We note your response to comment 28 that you have not
determined
the number and terms of the options and restricted stock units you
intend to issue. Please ensure such amounts and terms are
included
in the notes to the pro forma financial information and MD&A once
they are determined. Additionally, please supplementally tell us,
and include in your revised filing, how the stock based
compensation
expense of $.5 million included in adjustment (1) was calculated
or
determined.
`
`````Management`s Discussion and Analysis, pages 35
Trends that have affected our results of operations, page 37
8. We note your response to prior comment 33; however, please
further
revise to provide more detail, such as what portion of the
increase
was attributable to this cause, and clarify the nature of your
strategic relationships that facilitated the addition of new
accounts.
Provision for credit losses, page 39
9. We note your response to comment 35 that the disclosure on page
39
has been revised. Please supplementally tell us why the provision
has decreased from December 31, 2003 considering that accounts
receivable has increased approximately 50% since year-end.
Additionally, please tell us how the decline in charge offs over
the
last nine months is a reasonable explanation for reducing the
provision considering that the decline is not a historical trend,
as
there was an increase in charge offs during the year ended
December
31, 2003.
Liquidity and Capital Resources, page 46
10. We note your response to Comment 37 that you are in the
process
of finalizing certain aspects of the transitional services
agreement
and have added skeleton language on page 47 that will be completed
once discussions are finalized. Please ensure in subsequent
amendments that the language regarding termination of services by
Cendant is included in this section of MD&A.
Consolidated Balance Sheets, page F-2
11. We note your response to our prior comment number 54 but do
not
believe that providing the disclosures requested in our prior
comment
in your pro forma financial information satisfies the requirements
of
SAB Topic 1:B:3. Accordingly, as requested in our prior comment,
please revise to give retroactive effect to the dividend that the
Company plans to pay to Cendant prior to the completion of its
public
offering in the balance sheet for the most recent interim period
presented, or revise to include a pro forma balance sheet
alongside
the Company`s historic balance sheet for the most recent interim
period giving effect to the dividend. Additionally, pro forma
earnings per share, giving effect to the number of shares whose
proceeds would be sufficient to replace the capital in excess of
earnings withdrawn, should be reflected on the face of the
Company`s
statements of operations for the latest fiscal year and subsequent
interim period presented in accordance with the guidance outlined
in
SAB Topic 1:B:3. Your revised disclosures should also include
footnote disclosures explaining the nature of the pro forma
balance
sheet and earnings per share presentations.
Notes to Combined Financial Statements
Note 11. Related Parties
12. Based on the disclosures provided on pages 93 through 96 of
the
registration statement, it does not appear that all transactions
between the Company and its affiliates (i.e., other subsidiaries
of
Cendant) have been disclosed in the notes to the Company`s
financial
statements. Please revise the notes to the Company`s financial
statements to include disclosure of all transactions between the
Company and its affiliates during the various periods presented in
the Company`s financial statements. Refer to the requirements of
paragraph 2 of SFAS No.57.
Note 17. Segment Information, page F-42
13. We note your response to Comment 57 that you have five
operating
segments but only two reportable segments, "Wright Express" and
"Other." Please revise your segment disclosures to include
disclosure of total assets for each of your segments. Also,
revise
to include the disclosures required by paragraph 27(c) through (h)
of
SFAS No. 131, as applicable for each of your segments or explain
why
you do not believe additional disclosures are required. See
guidelines in paragraph 27 of SFAS No. 131.
````````````
******
As appropriate, please amend the registration statement in
response to these comments. You may wish to provide us with
marked
copies of the amendment to expedite our review. Please furnish a
cover letter with your amendment that keys your responses to our
comments and provides any requested supplemental information.
Detailed cover letters greatly facilitate our review. Please
understand that we may have additional comments after reviewing
your
amendment and responses to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision. Since the company and its management are in
possession of all facts relating to a company`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have made.
Notwithstanding our comments, in the event the company
requests
acceleration of the effective date of the pending registration
statement, it should furnish a letter, at the time of such
request,
acknowledging that
* Should the Commission or the staff, acting pursuant to delegated
authority, declare the filing effective, it does not foreclose the
Commission from taking any action with respect to the filing;
* The action of the Commission or the staff, acting pursuant to
delegated authority in declaring the filing effective, does not
relieve the company from its full responsibility for the adequacy
and
accuracy of the disclosure in the filing; and
* The company may not assert this action as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in connection with our review of
your
filing or in response to our comments on your filing.
We will consider a written request for acceleration of the
effective date of the registration statement as a confirmation of
the
fact that those requesting acceleration are aware of their
respective
responsibilities under the Securities Act of 1933 and the
Securities
Exchange Act of 1934 as they relate to the proposed public
offering
of the securities specified in the above registration statement.
We
will act on the request and, pursuant to delegated authority,
grant
acceleration of the effective date.
We direct your attention to Rules 460 and 461 regarding
requesting acceleration of a registration statement. Please allow
adequate time after the filing of any amendment for further review
before submitting a request for acceleration. Please provide this
request at least two business days in advance of the requested
effective date.
You may contact Claire Lamoureux, Staff Accountant, at (202)
824-5663 or Linda Cvrkel, Branch Chief, at (202) 942-1936 if you
have
questions regarding comments on the financial statements and
related
matters. Please contact Johanna Vega Losert, Attorney-Advisor, at
(202) 942-2931 or the undersigned at (202) 942-2936 with any other
questions.
Regards,
Sara W. Dunton
Branch Chief
cc: via facsimile (917) 777-2103
Gregory A. Fernicola
Nanda Monteiro
Skadden Arps Slate Meagher & Flom LLP
Four Times Square
New York, New York
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Wright Express Corporation Form S-1
January 14, 2005
Page 5