-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, PitonCxarzreWeKLp6ZKBInpSPB2g7Cu7l422AhLJpICrgc5dS9lGT5HENx7sWeG jkMm6sB+wDkUAwrz9LZobA== 0000950144-94-000975.txt : 19940513 0000950144-94-000975.hdr.sgml : 19940513 ACCESSION NUMBER: 0000950144-94-000975 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19940331 FILED AS OF DATE: 19940506 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GENUINE PARTS CO CENTRAL INDEX KEY: 0000040987 STANDARD INDUSTRIAL CLASSIFICATION: 5013 IRS NUMBER: 580254510 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05690 FILM NUMBER: 94526368 BUSINESS ADDRESS: STREET 1: 2999 CIRCLE 75 PARKWAY CITY: ATLANTA STATE: GA ZIP: 30339 BUSINESS PHONE: 4049531700 MAIL ADDRESS: STREET 1: 2999 CIRCLE 75 PARKWAY CITY: ATLANTA STATE: GA ZIP: 30339 10-Q 1 GENUINE PARTS FORM 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------------- FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ------------------------- For The Quarter Ended March 31, 1994 Commission File Number 1-5690 -------------- -------- GENUINE PARTS COMPANY ------------------------------------------------------ (Exact name of registrant as specified in its charter) GEORGIA 58-0254510 - - ------------------------------- -------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 2999 CIRCLE 75 PARKWAY, ATLANTA, GEORGIA 30339 - - ---------------------------------------- ------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (404) 953-1700 --------------------------- Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes * No ----- ----- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the close of the period covered by this report. 124,496,011 ------------------------ (Shares of Common Stock) 1 2 FORM 10-Q PART 1 - Financial Information Item 1 - Financial Statements GENUINE PARTS COMPANY and SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS
ASSETS ------ Mar. 31, Dec. 31, 1994 1993 --------- ---------- (Unaudited) (dollars in thousands) CURRENT ASSETS - - -------------- Cash and cash equivalents . . . . . . . . . . . . . . . . . $ 150,117 $ 123,231 Short-term investments . . . . . . . . . . . . . . . . . . 57,962 64,599 Trade accounts and notes receivable, less allowance for doubtful accounts (1994-$4,066; 1993-$1,582) . . . . 487,818 428,911 Inventories - at lower of cost (substantially last-in, first-out method) or market. . . . . . . . . . . . . . . 870,751 879,154 Prepaid and other current items . . . . . . . . . . . . . . 13,672 10,299 ---------- ---------- TOTAL CURRENT ASSETS . . . . . . . . . 1,580,320 1,506,194 Investments and other assets. . . . . . . . . . . . . . . . 132,932 133,364 Total property, plant and equipment, less allowance for depreciation (1994-$188,224; 1993-$185,101). . . . . 234,351 231,198 ---------- ---------- $1,947,603 $1,870,756 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY ------------------------------------ CURRENT LIABILITIES - - ------------------- Accounts payable. . . . . . . . . . . . . . . . . . . . . . $ 276,648 $ 258,949 Income taxes. . . . . . . . . . . . . . . . . . . . . . . . 43,354 11,688 Other current liabilities . . . . . . . . . . . . . . . . . 78,271 82,835 ---------- ---------- TOTAL CURRENT LIABILITIES. . . . . . . 398,273 353,472 Long-term debt. . . . . . . . . . . . . . . . . . . . . . . 13,148 12,265 Deferred income taxes . . . . . . . . . . . . . . . . . . . 37,980 37,980 Minority interests in subsidiaries. . . . . . . . . . . . . 22,574 21,776 SHAREHOLDERS' EQUITY - - -------------------- Stated capital: Preferred stock, par value - $1 per share Authorized - 10,000,000 shares - None Issued . . . . . -0- -0- Common stock, par value - $1 per share Authorized - 150,000,000 shares Issued - 1994: 124,496,011; 1993: 124,282,289. . . . . 124,496 124,282 Additional paid-in capital. . . . . . . . . . . . . . . . . 3,598 2,566 Retained earnings . . . . . . . . . . . . . . . . . . . . . 1,347,534 1,318,415 ---------- ---------- TOTAL SHAREHOLDERS' EQUITY . . . . . . 1,475,628 1,445,263 ---------- ---------- $1,947,603 $1,870,756 ========== ==========
See notes to consolidated condensed financial statements. 2 3 FORM 10-Q GENUINE PARTS COMPANY and SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Three Months Ended March 31, ---------------------------- 1994 1993 ---- ---- (000 omitted except per share data) Net Sales . . . . . . . . . . . . . . . . . . . . . . . $1,162,075 $1,037,914 Cost of goods sold. . . . . . . . . . . . . . . . . . . 815,618 727,493 ---------- ---------- 346,457 310,421 Selling, administrative & other expenses. . . . . . . . 243,356 219,614 ---------- ---------- Income before income taxes and cumulative effect of changes in accounting principles 103,101 90,807 Income taxes. . . . . . . . . . . . . . . . . . . . . . 40,210 34,416 ---------- ---------- Income before cumulative effect of changes in accounting principles . . . . . . . . . . . . 62,891 56,391 Cumulative effect of changes in accounting principles, net of tax - Note B. . . . . . . . . -- (1,055) ---------- ---------- NET INCOME. . . . . . . . . . . . . . . . . . . . . . . $ 62,891 $ 55,336 ========== ========== Average common shares outstanding . . . . . . . . . . . 124,469 124,179 ========== ========== Net income per common share . . . . . . . . . . . . . . $ .51 $ .45 ========== ========== Dividends declared per common share . . . . . . . . . . $ .2875 $ .265 ========== ========== ****************************************************************************************************************
See notes to consolidated condensed financial statements. 3 4 FORM 10-Q GENUINE PARTS COMPANY and SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS PART I (Unaudited)
Three Months Ended Mar. 31, -------------- (000 omitted) 1994 1993 ---- ---- Cash Provided By: - - ----------------- OPERATING ACTIVITIES: Net income . . . . . . . . . . . . . . . . . . . . . . . $ 62,891 $ 55,336 Adjustment to reconcile net income to net cash provided by operating activities: Depreciation and amortization . . . . . . . . . . . . 9,073 8,464 Other . . . . . . . . . . . . . . . . . . . . . . . . 798 646 Changes in operating assets and liabilities: Trade accounts receivable (58,907) (43,821) Merchandise inventories 8,403 (2,478) Trade accounts payable 17,699 6,130 Income taxes payable 31,666 14,798 Other operating assets and liabilities (10,575) (6,091) -------- -------- NET CASH PROVIDED BY OPERATING ACTIVITIES . . . . . . . . . . . . . . 61,048 32,984 INVESTING ACTIVITIES: Purchases of short-term investments, net of proceeds from sale and maturity 6,637 (66,956) Purchase of property, plant and equipment (12,651) (12,174) Other investing activities 2,876 (401) -------- -------- NET CASH USED IN INVESTING ACTIVITIES . . . . . . . . . . . . . . . . (3,138) (79,531) FINANCING ACTIVITIES: Dividends paid (32,933) (31,098) Other financing activities 1,909 1,065 -------- -------- NET CASH USED IN FINANCING ACTIVITIES . . . . . . . . . . (31,024) (30,033) -------- -------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS . . 26,886 (76,580) -------- -------- CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD . . . . 123,231 168,019 -------- -------- CASH AND CASH EQUIVALENTS AT END OF PERIOD . . . . . . . $150,117 $ 91,439 ======== ========
See notes to consolidated condensed financial statements. 4 5 FORM 10-Q NOTES TO FINANCIAL STATEMENTS Note A - Basis of Presentation The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all information and footnotes necessary for a fair presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles. However, in the opinion of management, all adjustments necessary to a fair statement of the operations of the interim period have been made. These adjustments are of a normal recurring nature. The results of operations for the three months ended March 31, 1994, are not necessarily indicative of results for the entire year. Note B - Accounting Changes During the quarter ended March 31, 1993, the Company adopted Statement of Financial Accounting Standards No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions" which requires the projected future costs of providing postretirement benefits, such as health care and life insurance, be recognized as an expense as employees render service instead of when benefits are paid. The Company has applied the new rules using the cumulative effect method, resulting in a charge of $5,055,000 (net of income taxes of $3,095,000). Also during the quarter ended March 31, 1993, the Company adopted Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes". The cumulative effect as of January 1, 1993, of adopting Statement 109 increased net income by $4,000,000. As permitted by the Statement, prior year financial statements have not been restated to reflect the impact of the change in accounting method. The adoption of Statements 106 and 109 did not have a material impact on the Company's financial statements or its results of operations. Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The Company reported record sales and earnings in the first quarter of 1994. Sales for the quarter were $1.16 billion, up 12% over the same period in 1993. Net income in the quarter advanced 14% to $62.9 million. On a per-share basis, net income for the quarter was $.51 versus $.45 in the same quarter of the prior year. During the quarter, all three industry segments registered sound growth. Sales for the Automotive Parts Group increased 10%, reflecting the strength of NAPA programs in the marketplace. The Industrial Parts Group increased 11%, as industrial production and factory utilization improved. The Office Products Group increased 19%, reflecting innovative marketing programs and an outstanding level of service. Each of the three segments should continue to show progress and provide steady sales growth in the future. The Company continues to believe that its sales growth in all three segments outpaces industry growth. Cost of goods sold decreased slightly as a percentage of net sales over the same quarter the prior year. Selling, administrative and other expenses increased 11% for the quarter and the percentage to net sales decreased slightly due to expense controls. 5 6 FORM 10-Q The first quarter results for 1993 included the net effect of adoption of FAS 106, "Employers' Accounting for Postretirement Benefits Other Than Pension", of a charge of $5,055,000 (net of income taxes of $3,095,000) and an increase in net income of $4,000,000 for the adoption of FAS 109, "Accounting for Income Taxes". The adoption of FAS 106 and 109 did not have a material impact on the Company's financial statements or its results of operations. The ratio of current assets to current liabilities remains very good at 3.97/1, and the Company's cash position is excellent. PART II Item 4. Exhibits and Reports on Form 8-K (a) Exhibits Exhibit 10.10 * Restricted Stock Agreement dated March 31, 1994 between the Company and Larry L. Prince. Exhibit 10.11 * Restricted Stock Agreement dated March 31, 1994 between the Company and Thomas C. Gallagher. * Indicates executive compensation plans and arrangements. (b) No reports on Form 8-K were filed by the registrant during the quarter ended March 31, 1994. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Genuine Parts Company ------------------------------- (Registrant) Date May 6, 1994 /s/ Jerry Nix -------------------- --------------------------------- Senior Vice President - Finance /s/ George Kalafut -------------------------------------- Executive Vice President - Finance and Administration (Principal Financial and Accounting Officer) 6 EX-10.10 2 GENUINE PARTS RESTRICTED STOCK AGREEMENT 1 EXHIBIT 10.10 GENUINE PARTS COMPANY 1992 STOCK OPTION AND INCENTIVE PLAN RESTRICTED STOCK AGREEMENT Grantee: Larry Prince Number of Shares: 100,000 Date: March 31, 1994 1. Agreement to Award Restricted Stock. Subject to the satisfaction of the conditions specified in Section 2 hereof, Genuine Parts Company (the "Company") hereby agrees to award to Larry Prince ("Grantee"), under its 1992 Stock Option and Incentive Plan ("Plan"), up to a maximum of One Hundred Thousand (100,000) shares of its Common Stock, such shares to be awarded to Grantee as Restricted Stock pursuant to the terms of the Plan and this Restricted Stock Agreement (this "Agreement"). The Plan is incorporated herein by reference and made a part of this Agreement, and any term used in this Agreement and not defined herein shall have the meaning set forth in the Plan. Grantee shall have no rights as a shareholder of Company with respect to any of the shares of Common Stock subject hereto prior to the awarding of such shares pursuant to Section 2 below. 2. Conditions for Award of Restricted Stock. (a) A maximum of 50,000 shares of Restricted Stock will be awarded to Grantee if the Company's Common Stock achieves specified target prices (the "Stock Price Targets"). The Company will be deemed to have achieved a Stock Price Target, and shares of Restricted Stock will be awarded to the Grantee, on the date on which the average Fair Market Value (as defined in the Plan) of the Common Stock over a period of twenty consecutive trading days (days on which shares of Company Common Stock are actually traded on the New York 2 Stock Exchange) first equals or exceeds the Stock Price Target (the "Stock Price Award Dates"). The Grantee will be awarded the following number of shares of Restricted Stock on the Stock Price Award Dates upon the Company's achievement of the following Stock Price Targets:
STOCK PRICE TARGET ($) SHARES OF RESTRICTED STOCK AWARDED ---------------------- ---------------------------------- 41.25 10,000 48.125 10,000 55.00 10,000 61.875 10,000 68.75 10,000
(b) A maximum of 50,000 shares of Restricted Stock will be awarded to Grantee if the Company achieves certain earnings per share targets (the "EPS Targets"). The Company's earnings per share ("EPS") shall be deemed to be the Company's "net income per common share" as reported in the Company's annual audited consolidated financial statements. The determination of whether the Company has achieved the EPS Targets, and the award of shares of Restricted Stock to the Grantee based thereon, shall be made immediately upon the conclusion of the annual audit closing conference with the Company's independent auditor's if such auditors have provided to Company management at that conference an unqualified opinion on the Company's fiscal year end audited consolidated financial statements (the "EPS Award Dates"). The Grantee will be awarded the following number of shares of Restricted Stock on the EPS Award Dates upon the Company's achievement during fiscal years 1994, 1995, 1996, 1997 and 1998 of the following EPS Targets: - 2 - 3 FOR FISCAL YEAR 1994:
NUMBER OF SHARES OF EARNINGS PER SHARE RESTRICTED STOCK AWARDED ------------------ ------------------------ Greater than or equal to $2.29 (1993 EPS plus 10%) 10,000 Greater than or equal to $2.27 (1993 EPS plus 9%) but less than 9,000 $2.29 Greater than or equal to $2.25 (1993 EPS plus 8%) but less than 8,000 $2.27 Less than $2.25 0
FOR EACH OF FISCAL YEAR 1995, 1996, 1997 AND 1998:
NUMBER OF SHARES OF EARNINGS PER SHARE RESTRICTED STOCK AWARDED ------------------ ------------------------ Greater than or equal to the prior fiscal year EPS plus 10% 10,000 Greater than or equal to the prior fiscal year EPS plus 9%, but 9,000 less than the prior fiscal year EPS plus 10% Greater than or equal to the prior fiscal year EPS plus 8%, but 8,000 less than the prior fiscal year EPS plus 9% Less than the prior fiscal year EPS plus 8% 0
(c) For the purposes of determining the Company's EPS and the EPS Targets hereunder, actual figures shall be rounded up or down, as appropriate, to the second decimal place (with $0.005 to be rounded up to $0.01). (d) All Stock Price Targets and EPS Targets, and the number of shares of Restricted Stock to be awarded hereunder, shall be adjusted to reflect any adjustment of shares of Common Stock as described in Section 1.5 of the Plan. - 3 - 4 3. Restricted Period. Subject to the provisions of Section 9 and 10 of this Agreement, the Restricted Period with respect to the shares of Restricted Stock awarded to the Grantee under Section 2 shall commence on the respective Award Dates for such shares and shall terminate at 5:00 p.m., Eastern Standard Time, on March 31, 2004, the tenth anniversary of the date of this Agreement. 4. Issuance of Shares. The Company shall issue a certificate for an appropriate number of shares of Common Stock awarded to the Grantee as Restricted Stock pursuant to Section 2 of this Agreement on the relevant Award Date. The Company shall issue a separate certificate for each award of shares of Restricted Stock under Section 2. Each certificate issued for shares awarded to the Grantee under this Agreement shall be registered in the name of the Grantee and shall be deposited with the Company or its designee in an escrow account, together with stock powers or other instruments of transfer to be provided and appropriately endorsed in blank by the Grantee as of the relevant Award Date. Each such certificate shall bear a legend in substantially the following form: This certificate and the shares of stock represented hereby are subject to the terms and conditions (including forfeiture and restrictions against transfer) contained in the Genuine Parts Company 1992 Stock Option and Incentive Plan and a Restricted Stock Agreement between the registered owner of the shares represented hereby and Genuine Parts Company. Release from such terms and conditions shall be made only in accordance with the provisions of such Plan and Agreement, copies of which are on file in the office of the Secretary of Genuine Parts Company. 5. Release of Shares. Subject to the provisions of Sections 9 and 10 of this Agreement, the Company, provided that the Grantee remains in the employment of the Company or a Subsidiary during the entirety of the applicable Restricted Period, shall release from escrow and deliver to the Grantee or the legal representative of the Grantee, as appropriate, free of the legend described in Section 4 above, the certificate evidencing shares of Restricted Stock - 4 - 5 awarded under Section 2 as promptly as practicable following the date the Restricted Period expires with respect to such Restricted Stock. 6. Restrictions on Transfer of Shares. Restricted Shares awarded under the Plan, and the right to vote such shares and to receive dividends thereon, may not, except as otherwise provided in the Plan, be sold, assigned, transferred, exchanged, pledged or otherwise encumbered during the Restricted Period applicable to such shares, and no such sale, assignment, transfer, exchange, pledge or encumbrance, whether made or created by voluntary act of the Grantee or of any agent of such Grantee or by operation of law, shall be recognized by, or be binding upon, or shall in any manner affect the rights of, the Company or any agent or any custodian holding certificates for such shares during the applicable Restricted Period. 7. Rights of Grantee During Restricted Periods. Except as otherwise provided in the Plan, the Grantee shall, during the applicable Restricted Periods, have all of the other rights of a common shareholder with respect to Restriced Shares awarded to the Grantee under Section 2 including, without limitation, the right to receive cash dividends, if any, as may be declared on such shares from time to time, and the right to vote (in person or by proxy) such shares at any meeting of shareholders of the Company. Any shares of Common Stock issued to Grantee as a dividend with respect to Restricted Stock awarded hereunder shall have the same status and bear the same legend as the Restricted Stock and shall be held in escrow, if the relevant Restricted Stock is held in escrow, unless otherwise determined by the Committee. 8. Termination of Employment. Subject to Section 10 of this Agreement, upon the termination of Grantee's employment with the Company ("Termination"), other than in connection with a Change in Control or Grantee's Retirement, Disability or death (as such terms are defined in Section 9(b) hereof), (i) all of Grantee's rights to future awards of Restricted Stock upon achievement of Stock Price Targets or EPS Targets on Award Dates subsequent to - 5 - 6 the date of Termination shall terminate without the payment of any consideration by the Company, (ii) all shares of Restricted Stock theretofore awarded to the Grantee for which the Restricted Period has not terminated prior to such Termination shall be forfeited by the Grantee to the Company without the payment of any consideration by the Company, and (iii) all unissued shares of Common Stock reserved for issuance to Grantee pursuant to Section 14 hereof shall be released from such reservation. In such event, neither the Grantee nor any successors, heirs, assigns, or personal representatives of the Grantee shall thereafter have any further rights or interest in such shares, and the Grantee's name shall thereupon be deleted from the list of the Company's shareholders with respect to such shares. 9. Change of Control, Retirement, Disability or Death. (a) Upon a Change in Control, the Retirement or Disability of the Grantee, or the Grantee's death while in the employment of the Company or a Subsidiary, (i) all of Grantee's rights to future awards of Restricted Stock upon achievement of Stock Price Targets or EPS Targets on Award Dates subsequent to the date of Termination shall terminate without the payment of any consideration by the Company, and (ii) the Restricted Period to which any shares of Restricted Stock awarded to the Grantee under Section 2 are subject shall expire as of the date of the Change in Control or Grantee's Retirement, Disability or death. In such event, the Company shall release from escrow and deliver to the Grantee or the legal representative of the Grantee, as appropriate, the certificate(s) representing the relevant Restricted Stock free of restrictive legend in accordance with Section 5 hereof. (b) For the purposes of this Agreement, the following terms shall have the following meanings: (i) a Change in Control shall have the meaning specified in Section 1.5(b) of the Plan; (ii) "Retirement" shall mean normal retirement as defined in the Company's Pension Plan or in any modification thereof or successor thereto; and (iii) "Disability" shall have the meaning specified in the Company's Long Term Disability Plan or in any modification thereof or successor thereto. - 6 - 7 10. Committee Acceleration Power. Notwithstanding any other provisions of the Plan or this Agreement, the Committee shall be authorized in its discretion, based upon its review and evaluation of the performance of the Company and its Subsidiaries, to accelerate the release to the Grantee of Restricted Stock subject to this Agreement upon such terms and conditions as the Committee may deem advisable. 11. Federal Income Tax Matters. The Grantee, upon award of the shares of Restricted Stock under Section 2, shall be authorized to make an election to be taxed upon such award under Section 83(b) of the Code. To effect such election, the Grantee may file an appropriate election with the Internal Revenue Service within thirty (30) days after such awards of the Restricted Stock hereunder and otherwise in accordance with applicable Treasury Regulations. The Grantee recognizes that, pursuant to Section 4.3 of the Plan, the Company may require the Grantee to remit to the Company an amount sufficient to satisfy any federal, state or local withholding tax liability in connection with the agreement to award, award of, or release from escrow of the shares of Restricted Stock granted hereunder. 12. Continued Employment Not Presumed. Neither (i) the Plan, (ii) the agreement to award, award or vesting of Restricted Stock under this Agreement nor (iii) this Agreement, shall give Grantee a right to continued employment by the Company or its Subsidiaries or affect the right of the Company and its Subsidiaries to terminate the employment of Grantee with or without cause. 13. Grantee's Covenant. The Grantee hereby agrees to use his or her best efforts to provide services to the Company in a workmanlike manner and to promote the Company's interests. - 7 - 8 14. Reservation of Shares. As of the date of this Agreement, the Company shall reserve for issuance 100,000 shares of its Common Stock to be issued pursuant to the terms of this Agreement. If the Grantee's rights with respect to the unissued of Restricted Stock subject to this Agreement terminate pursuant to Section 8 or Section 9 hereof, then such unissued shares of Common Stock shall no longer be reserved for issuance pursuant to this Agreement. 15. Plan Controls. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Agreement, the provisions of the Plan shall be controlling and determinative. 16. Successors. This Agreement shall be binding upon any successor of the Company, in accordance with the terms of this Agreement and the Plan. - 8 - 9 IN WITNESS WHEREOF, Genuine Parts Company, acting by and through its duly authorized officers, has caused this Restricted Stock Agreement to be executed, and the Grantee has executed this Restricted Stock Agreement, all as of the day and year first above written. GENUINE PARTS COMPANY By:/s/ George W. Kalafut --------------------- Title: Executive Vice President Finance ATTEST: /s/ Brainard T. Webb, Jr. - - ------------------------- Title: Secretary [CORPORATE SEAL] GRANTEE /s/ Larry Prince ------------------------ Larry Prince - 9 - EX-10.11 3 GENUINE PARTS RESTRICTED STOCK AGREEMENT 1 EXHIBIT 10.11 GENUINE PARTS COMPANY 1992 STOCK OPTION AND INCENTIVE PLAN RESTRICTED STOCK AGREEMENT Grantee: Tom Gallagher Number of Shares: 50,000 Date: March 31, 1994 1. Agreement to Award Restricted Stock. Subject to the satisfaction of the conditions specified in Section 2 hereof, Genuine Parts Company (the "Company") hereby agrees to award to Tom Gallagher ("Grantee"), under its 1992 Stock Option and Incentive Plan ("Plan"), up to a maximum of Fifty Thousand (50,000) shares of its Common Stock, such shares to be awarded to Grantee as Restricted Stock pursuant to the terms of the Plan and this Restricted Stock Agreement (this "Agreement"). The Plan is incorporated herein by reference and made a part of this Agreement, and any term used in this Agreement and not defined herein shall have the meaning set forth in the Plan. Grantee shall have no rights as a shareholder of Company with respect to any of the shares of Common Stock subject hereto prior to the awarding of such shares pursuant to Section 2 below. 2. Conditions for Award of Restricted Stock. (a) A maximum of 25,000 shares of Restricted Stock will be awarded to Grantee if the Company's Common Stock achieves specified target prices (the "Stock Price Targets"). The Company will be deemed to have achieved a Stock Price Target, and shares of Restricted Stock will be awarded to the Grantee, on the date on which the average Fair Market Value (as defined in the Plan) of the Common Stock over a period of twenty consecutive trading days (days on which shares of Company Common Stock are actually traded on the New York 2 Stock Exchange) first equals or exceeds the Stock Price Target (the "Stock Price Award Dates"). The Grantee will be awarded the following number of shares of Restricted Stock on the Stock Price Award Dates upon the Company's achievement of the following Stock Price Targets:
STOCK PRICE TARGET ($) SHARES OF RESTRICTED STOCK AWARDED ---------------------- ---------------------------------- 41.25 5,000 48.125 5,000 55.00 5,000 61.875 5,000 68.75 5,000
(b) A maximum of 25,000 shares of Restricted Stock will be awarded to Grantee if the Company achieves certain earnings per share targets (the "EPS Targets"). The Company's earnings per share ("EPS") shall be deemed to be the Company's "net income per common share" as reported in the Company's annual audited consolidated financial statements. The determination of whether the Company has achieved the EPS Targets, and the award of shares of Restricted Stock to the Grantee based thereon, shall be made immediately upon the conclusion of the annual audit closing conference with the Company's independent auditor's if such auditors have provided to Company management at that conference an unqualified opinion on the Company's fiscal year end audited consolidated financial statements (the "EPS Award Dates"). The Grantee will be awarded the following number of shares of Restricted Stock on the EPS Award Dates upon the Company's achievement during fiscal years 1994, 1995, 1996, 1997 and 1998 of the following EPS Targets: - 2 - 3 FOR FISCAL YEAR 1994:
NUMBER OF SHARES OF EARNINGS PER SHARE RESTRICTED STOCK AWARDED ------------------ ------------------------ Greater than or equal to $2.29 (1993 EPS plus 10%) 5,000 Greater than or equal to $2.27 (1993 EPS plus 9%) but less than 4,500 $2.29 Greater than or equal to $2.25 (1993 EPS plus 8%) but less than 4,000 $2.27 Less than $2.25 0
FOR EACH OF FISCAL YEAR 1995, 1996, 1997 AND 1998:
NUMBER OF SHARES OF EARNINGS PER SHARE RESTRICTED STOCK AWARDED ------------------ ------------------------ Greater than or equal to the prior fiscal year EPS plus 10% 5,000 Greater than or equal to the prior fiscal year EPS plus 9%, but 4,500 less than the prior fiscal year EPS plus 10% Greater than or equal to the prior fiscal year EPS plus 8%, but 4,000 less than the prior fiscal year EPS plus 9% Less than the prior fiscal year EPS plus 8% 0
(c) For the purposes of determining the Company's EPS and the EPS Targets hereunder, actual figures shall be rounded up or down, as appropriate, to the second decimal place (with $0.005 to be rounded up to $0.01). (d) All Stock Price Targets and EPS Targets, and the number of shares of Restricted Stock to be awarded hereunder, shall be adjusted to reflect any adjustment of shares of Common Stock as described in Section 1.5 of the Plan. - 3 - 4 3. Restricted Period. Subject to the provisions of Section 9 and 10 of this Agreement, the Restricted Period with respect to the shares of Restricted Stock awarded to the Grantee under Section 2 shall commence on the respective Award Dates for such shares and shall terminate at 5:00 p.m., Eastern Standard Time, on March 31, 2004, the tenth anniversary of the date of this Agreement. 4. Issuance of Shares. The Company shall issue a certificate for an appropriate number of shares of Common Stock awarded to the Grantee as Restricted Stock pursuant to Section 2 of this Agreement on the relevant Award Date. The Company shall issue a separate certificate for each award of shares of Restricted Stock under Section 2. Each certificate issued for shares awarded to the Grantee under this Agreement shall be registered in the name of the Grantee and shall be deposited with the Company or its designee in an escrow account, together with stock powers or other instruments of transfer to be provided and appropriately endorsed in blank by the Grantee as of the relevant Award Date. Each such certificate shall bear a legend in substantially the following form: This certificate and the shares of stock represented hereby are subject to the terms and conditions (including forfeiture and restrictions against transfer) contained in the Genuine Parts Company 1992 Stock Option and Incentive Plan and a Restricted Stock Agreement between the registered owner of the shares represented hereby and Genuine Parts Company. Release from such terms and conditions shall be made only in accordance with the provisions of such Plan and Agreement, copies of which are on file in the office of the Secretary of Genuine Parts Company. 5. Release of Shares. Subject to the provisions of Sections 9 and 10 of this Agreement, the Company, provided that the Grantee remains in the employment of the Company or a Subsidiary during the entirety of the applicable Restricted Period, shall release from escrow and deliver to the Grantee or the legal representative of the Grantee, as appropriate, free of the legend described in Section 4 above, the certificate evidencing shares of Restricted Stock - 4 - 5 awarded under Section 2 as promptly as practicable following the date the Restricted Period expires with respect to such Restricted Stock. 6. Restrictions on Transfer of Shares. Restricted Shares awarded under the Plan, and the right to vote such shares and to receive dividends thereon, may not, except as otherwise provided in the Plan, be sold, assigned, transferred, exchanged, pledged or otherwise encumbered during the Restricted Period applicable to such shares, and no such sale, assignment, transfer, exchange, pledge or encumbrance, whether made or created by voluntary act of the Grantee or of any agent of such Grantee or by operation of law, shall be recognized by, or be binding upon, or shall in any manner affect the rights of, the Company or any agent or any custodian holding certificates for such shares during the applicable Restricted Period. 7. Rights of Grantee During Restricted Periods. Except as otherwise provided in the Plan, the Grantee shall, during the applicable Restricted Periods, have all of the other rights of a common shareholder with respect to Restriced Shares awarded to the Grantee under Section 2 including, without limitation, the right to receive cash dividends, if any, as may be declared on such shares from time to time, and the right to vote (in person or by proxy) such shares at any meeting of shareholders of the Company. Any shares of Common Stock issued to Grantee as a dividend with respect to Restricted Stock awarded hereunder shall have the same status and bear the same legend as the Restricted Stock and shall be held in escrow, if the relevant Restricted Stock is held in escrow, unless otherwise determined by the Committee. 8. Termination of Employment. Subject to Section 10 of this Agreement, upon the termination of Grantee's employment with the Company ("Termination"), other than in connection with a Change in Control or Grantee's Retirement, Disability or death (as such terms are defined in Section 9(b) hereof), (i) all of Grantee's rights to future awards of Restricted Stock upon achievement of Stock Price Targets or EPS Targets on Award Dates subsequent to - 5 - 6 the date of Termination shall terminate without the payment of any consideration by the Company, (ii) all shares of Restricted Stock theretofore awarded to the Grantee for which the Restricted Period has not terminated prior to such Termination shall be forfeited by the Grantee to the Company without the payment of any consideration by the Company, and (iii) all unissued shares of Common Stock reserved for issuance to Grantee pursuant to Section 14 hereof shall be released from such reservation. In such event, neither the Grantee nor any successors, heirs, assigns, or personal representatives of the Grantee shall thereafter have any further rights or interest in such shares, and the Grantee's name shall thereupon be deleted from the list of the Company's shareholders with respect to such shares. 9. Change of Control, Retirement, Disability or Death. (a) Upon a Change in Control, the Retirement or Disability of the Grantee, or the Grantee's death while in the employment of the Company or a Subsidiary, (i) all of Grantee's rights to future awards of Restricted Stock upon achievement of Stock Price Targets or EPS Targets on Award Dates subsequent to the date of Termination shall terminate without the payment of any consideration by the Company, and (ii) the Restricted Period to which any shares of Restricted Stock awarded to the Grantee under Section 2 are subject shall expire as of the date of the Change in Control or Grantee's Retirement, Disability or death. In such event, the Company shall release from escrow and deliver to the Grantee or the legal representative of the Grantee, as appropriate, the certificate(s) representing the relevant Restricted Stock free of restrictive legend in accordance with Section 5 hereof. (b) For the purposes of this Agreement, the following terms shall have the following meanings: (i) a Change in Control shall have the meaning specified in Section 1.5(b) of the Plan; (ii) "Retirement" shall mean normal retirement as defined in the Company's Pension Plan or in any modification thereof or successor thereto; and (iii) "Disability" shall have the meaning specified in the Company's Long Term Disability Plan or in any modification thereof or successor thereto. - 6 - 7 10. Committee Acceleration Power. Notwithstanding any other provisions of the Plan or this Agreement, the Committee shall be authorized in its discretion, based upon its review and evaluation of the performance of the Company and its Subsidiaries, to accelerate the release to the Grantee of Restricted Stock subject to this Agreement upon such terms and conditions as the Committee may deem advisable. 11. Federal Income Tax Matters. The Grantee, upon award of the shares of Restricted Stock under Section 2, shall be authorized to make an election to be taxed upon such award under Section 83(b) of the Code. To effect such election, the Grantee may file an appropriate election with the Internal Revenue Service within thirty (30) days after such awards of the Restricted Stock hereunder and otherwise in accordance with applicable Treasury Regulations. The Grantee recognizes that, pursuant to Section 4.3 of the Plan, the Company may require the Grantee to remit to the Company an amount sufficient to satisfy any federal, state or local withholding tax liability in connection with the agreement to award, award of, or release from escrow of the shares of Restricted Stock granted hereunder. 12. Continued Employment Not Presumed. Neither (i) the Plan, (ii) the agreement to award, award or vesting of Restricted Stock under this Agreement nor (iii) this Agreement, shall give Grantee a right to continued employment by the Company or its Subsidiaries or affect the right of the Company and its Subsidiaries to terminate the employment of Grantee with or without cause. 13. Grantee's Covenant. The Grantee hereby agrees to use his or her best efforts to provide services to the Company in a workmanlike manner and to promote the Company's interests. - 7 - 8 14. Reservation of Shares. As of the date of this Agreement, the Company shall reserve for issuance 50,000 shares of its Common Stock to be issued pursuant to the terms of this Agreement. If the Grantee's rights with respect to the unissued of Restricted Stock subject to this Agreement terminate pursuant to Section 8 or Section 9 hereof, then such unissued shares of Common Stock shall no longer be reserved for issuance pursuant to this Agreement. 15. Plan Controls. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Agreement, the provisions of the Plan shall be controlling and determinative. 16. Successors. This Agreement shall be binding upon any successor of the Company, in accordance with the terms of this Agreement and the Plan. - 8 - 9 IN WITNESS WHEREOF, Genuine Parts Company, acting by and through its duly authorized officers, has caused this Restricted Stock Agreement to be executed, and the Grantee has executed this Restricted Stock Agreement, all as of the day and year first above written. GENUINE PARTS COMPANY By: /s/ George W. Kalafut --------------------- Title: Executive Vice President Finance ATTEST: /s/ Brainard T. Webb, Jr. - - ------------------------- Title: Secretary [CORPORATE SEAL] GRANTEE /s/ Tom Gallagher ------------------------- Tom Gallagher - 9 - -----END PRIVACY-ENHANCED MESSAGE-----