8-KLeadership ChangesExhibits & Filings

COPART INC 8-K Report, Executive Changes (Sep 10, 2007)

Filed September 10, 2007For Securities:CPRT

Summary

Copart, Inc. (CPRT) filed an 8-K on September 10, 2007, reporting significant changes to its Board of Directors. The filing announces the appointment of two new independent directors, Barry Rosenstein and Thomas W. Smith, effective September 17, 2007. These appointments fill vacancies created by the resignations of long-serving directors James Grosfeld and Harold Blumenstein, effective September 14, 2007. Both Rosenstein and Smith are experienced professionals with backgrounds in investment management and will receive standard director compensation, including cash and stock options. Importantly, their resignations are stated not to be due to any disagreement with the company. This board restructuring could signal a shift in corporate governance or strategic direction for Copart.

Key Highlights

  • 1Appointment of Barry Rosenstein, founder of JANA Partners, as an independent director to the Board, effective September 17, 2007.
  • 2Appointment of Thomas W. Smith, managing partner of Prescott Investors, as an independent director to the Board, effective September 17, 2007.
  • 3Resignation of long-standing directors James Grosfeld and Harold Blumenstein, effective September 14, 2007.
  • 4The resignations of Mr. Grosfeld and Mr. Blumenstein are explicitly stated as not being due to any disagreement with the company.
  • 5New directors Rosenstein and Smith will receive standard director compensation, including quarterly cash payments and stock options.
  • 6Vesting of unvested stock options for the resigning directors, Mr. Grosfeld and Mr. Blumenstein, was accelerated.
  • 7Copart expects to recognize approximately $1.0 million in non-cash stock compensation expense in Q1 fiscal 2008 related to the accelerated vesting and extended exercise periods for resigning directors.

Frequently Asked Questions

The filing states that Mr. Grosfeld and Mr. Blumenstein resigned to pursue other business and personal interests, and their resignations are not a result of any disagreement with Copart regarding its operations, policies, or practices.

Barry Rosenstein is the founder and managing partner of JANA Partners, LLC, an investment management firm. Thomas W. Smith is the managing partner of Prescott Investors, a private investment firm he founded.

Copart expects to recognize approximately $1.0 million in non-cash stock compensation expense during the first quarter of fiscal 2008. This expense is related to the accelerated vesting and extended exercise periods for stock options held by the departing directors, James Grosfeld and Harold Blumenstein.

Yes, Barry Rosenstein and Thomas W. Smith will receive standard compensation for non-management directors, which includes quarterly cash payments and stock options under the company's 2001 Stock Option Plan.