<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OF THE
SECURITIES EXCHANGE ACT OF 1934 (Fee Required)
________
For the Fiscal Year Ended: Commission File No. 1-5690
December 31, 1993
GENUINE PARTS COMPANY
(Exact name of Registrant as specified in its Charter)
GEORGIA 58-0254510
------- ----------
(State of Incorporation) (IRS Employer Identification No.)
2999 Circle 75 Parkway 30339
Atlanta, Georgia (Zip Code)
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (404) 953-1700.
Securities registered pursuant to Section 12(b) of the Act and the Exchange on
which such securities are registered:
COMMON STOCK, PAR VALUE, $1 PER SHARE NEW YORK STOCK EXCHANGE
Securities registered pursuant to Section 12(g) of the Act: None
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 X . NO .
----- -----
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. / /
The aggregate market value of the Registrant's Common Stock (based upon the
closing sales price reported by the New York Stock Exchange and published in
The Wall Street Journal on February 18, 1994) held by non-affiliates as of
February 18, 1994 was approximately $4,233,262,728.
The number of shares outstanding of Registrant's Common Stock, as of February
18, 1994: 124,464,667.
Documents Incorporated by Reference:
-Portions of the Annual Report to Shareholders for the fiscal year
ended December 31, 1993, are incorporated by reference into Parts
I and II.
-Portions of the definitive proxy statement for the Annual Meeting of
Shareholders to be held on April 18, 1994 are incorporated by
reference into Part III.
<PAGE> 2
PART I. ITEM I. BUSINESS.
Genuine Parts Company, a Georgia corporation incorporated on May 7,
1928, is a service organization engaged in the distribution of automotive
replacement parts, industrial replacement parts and office products. In 1993,
business was conducted throughout most of the United States and in western
Canada from more than 1,100 operations. As used in this report, the "Company"
refers to Genuine Parts Company and its subsidiaries, except as otherwise
indicated by the context; and the terms "automotive parts" and "industrial
parts" refer to replacement parts in each respective category.
Industry Segment Data. The following table sets forth the net sales, operating
profit and identifiable assets for the fiscal years 1993, 1992 and 1991
attributable to each of the Company's groups of products which the Company
believes indicate segments of its business. Sales to unaffiliated customers
are the same as net sales. The figures have been restated to give effect to
the acquisition of Berry Bearing Company and affiliates on January 29, 1993,
which was accounted for as a pooling of interests, and is described in Note 2
of "Notes to Consolidated Financial Statements" on Page 23 of the Annual Report
to Shareholders for 1993, which is incorporated herein by reference.
<TABLE>
<CAPTION>
1993 1992 1991
---- ---- ----
NET SALES (in thousands)
---------
<S> <C> <C> <C>
Automotive Parts $ 2,485,267 $ 2,318,761 $ 2,188,698
Industrial Parts 1,153,371 1,082,428 1,021,019
Office Products 745,656 615,562 554,019
--------- --------- ---------
TOTAL NET SALES $ 4,384,294 $ 4,016,751 $ 3,763,736
========= ========= =========
OPERATING PROFIT
----------------
Automotive Parts $ 282,791 $ 262,422 $ 260,818
Industrial Parts 96,727 87,493 76,922
Office Products 65,938 50,967 45,112
--------- --------- ---------
TOTAL OPERATING PROFIT 445,456 400,882 382,852
Interest Expense (1,584) (1,871) (5,434)
Corporate Expense (20,405) (17,577) (18,662)
Equity in Income 4,452 2,513 4,000
Minority Interests (2,090) (1,537) (1,638)
--------- --------- ---------
INCOME BEFORE
INCOME TAXES $ 425,829 $ 382,410 $ 361,118
========= ========= =========
IDENTIFIABLE ASSETS
-------------------
Automotive Parts $ 1,152,148 $ 1,040,191 $ 926,617
Industrial Parts 370,633 354,547 338,054
Office Products 283,479 228,802 201,036
--------- --------- ---------
TOTAL IDENTIFIABLE ASSETS 1,806,260 1,623,540 1,465,707
Corporate Assets 6,731 27,333 57,197
Equity Investments 57,765 56,430 54,612
--------- --------- ---------
TOTAL ASSETS $ 1,870,756 $ 1,707,303 $ 1,577,516
========= ========= =========
</TABLE>
For additional information regarding industry data, see Page 27 of
Annual Report to Shareholders for 1993.
The majority of the Company's revenue, profitability and identifiable
assets are attributable to the Company's operations in the United States.
Revenue, profitability and identifiable assets in Canada are not material. For
additional information regarding foreign operations, see "Note 1 of Notes to
Consolidated Financial Statements" on Page 23 of Annual Report to Shareholders
for 1993.
Competition - General. The distribution business, which includes all segments
of the Company's business, is highly competitive with the principal methods of
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competition being product quality, sufficiency of inventory, price and the
ability to give the customer prompt and dependable service. The Company
believes many of its competitors have greater financial resources and are more
broadly based than the Company. The Company anticipates no decline in
competition in any of its business segments in the foreseeable future.
Employees. As of December 31, 1993, the Company employed approximately 20,575
persons.
AUTOMOTIVE PARTS GROUP.
The Automotive Parts Group, the largest division of the Company,
distributes automotive replacement parts and accessory items. The Company is
the largest member of the National Automotive Parts Association ("NAPA"), a
voluntary trade association formed in 1925 to provide nationwide distribution
of automotive parts. In addition to the more than 143,000 part numbers that
are available, the Company, in conjunction with NAPA, offers complete
inventory, accounting, cataloging, marketing, training and other programs in
the automotive aftermarket.
As of December 31, 1993, the Company's Automotive Parts Group included
NAPA automotive parts distribution centers and automotive parts stores
("jobbing stores" or "jobbers") owned in the United States by Genuine Parts
Company and Davis & Wilmar, Inc., a wholly owned subsidiary, automotive parts
distribution centers and jobbing stores in western Canada owned and operated by
UAP/NAPA Automotive Western Partnership ("UAP/NAPA"), a general partnership in
which a wholly owned subsidiary of Genuine Parts Company owns a 49% interest,
jobbing stores in the United States operated by corporations in which Genuine
Parts Company owned a 51% interest, distribution centers owned by Balkamp,
Inc., a majority owned subsidiary, and rebuilding plants owned by the Company
and operated by its Rayloc division.
The Company's NAPA automotive parts distribution centers distribute
replacement parts (other than body parts) for substantially all motor vehicle
makes and models in service in the United States, including imported vehicles,
trucks, buses, motorcycles, recreational vehicles and farm vehicles. In
addition, the Company distributes small engines and replacement parts for farm
equipment and heavy duty equipment. The Company's inventories also include
accessory items for such vehicles and equipment, and supply items used by a
wide variety of customers in the automotive aftermarket, such as repair shops,
service stations, fleet operators, automobile and truck dealers, leasing
companies, bus and truck lines, mass merchandisers, farms, industrial concerns
and individuals who perform their own maintenance and parts installation.
Although the Company's domestic automotive operations purchase from more than
150 different suppliers, approximately 73% of 1993 automotive inventories were
purchased from 20 major suppliers. Since 1931, the Company has had return
privileges with most of its suppliers which has protected the Company from
inventory obsolescence.
Distribution System. As of December 31, 1993, Genuine Parts Company operated
63 domestic NAPA automotive parts distribution centers located in 36 states and
654 domestic company-owned jobbing stores located in 39 states. Davis &
Wilmar, Inc. operated 2 NAPA automotive parts distribution centers in
Pennsylvania and West Virginia and 29 jobbing stores in its trading area. In
addition, Genuine Parts Company owned a 51% interest in 42 corporations which
operated 59 jobbing stores in 26 states.
In Canada, Genuine Parts Company Ltd., a wholly owned subsidiary, owns
a 49% interest in UAP/NAPA which operated 8 automotive parts distribution
centers and 81 jobbing stores located in the provinces of Alberta, British
Columbia and Saskatchewan and in the Yukon Territories. The Company's
investment in UAP/NAPA is accounted for by the equity method of accounting;
therefore, the sales figures of UAP/NAPA are not included in the Company's
financial statements.
The Company's distribution centers serve approximately 5,069
independently owned jobbing stores located throughout the market areas served.
Jobbing stores, in turn, sell to a wide variety of customers in the automotive
aftermarket. Collectively, these jobbing stores account for approximately 42%
of the Company's total sales with no jobbing store or group of jobbing stores
with individual or
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common ownership accounting for more than .004% of the Company's total sales.
Products. Distribution centers carry approximately 143,000 different parts and
related supply items. Each item is cataloged and numbered for identification
and accessibility. Significant inventories are carried to provide for fast and
frequent deliveries to customers. Most orders are filled and shipped the same
day as received. The majority of sales are on terms which require payment
within 30 days of the statement date. The Company does not manufacture any of
the products it distributes.
Related Operations. A majority owned subsidiary of Genuine Parts Company,
Balkamp, Inc.("Balkamp"), distributes a wide variety of replacement parts and
accessory items for passenger cars, heavy duty vehicles, motorcycles and farm
equipment. In addition, Balkamp distributes service items such as testing
equipment, lubricating equipment, gauges, cleaning supplies, chemicals and
supply items used by repair shops, fleets, farms and institutions. Balkamp
packages many of the approximately 20,000 part numbers which constitute the
"Balkamp" line of products which are distributed to the members of the National
Automotive Parts Association ("NAPA"). These products are categorized in 150
different product groups purchased from more than 600 suppliers. All Balkamp
items are cataloged separately to provide single source convenience for NAPA
customers. BALKAMP(R), a federally registered trademark, is important to the
sales and marketing promotions of the Balkamp organization. Balkamp has three
distribution centers located in Indianapolis, Indiana, Greenwood, Mississippi,
and West Jordan, Utah.
The Company, through its Rayloc division, also operates six plants
where certain small automotive parts are rebuilt. These products are
distributed to the members of NAPA under the name Rayloc(R).
Segment Data. In the year ended December 31, 1993, sales from the Automotive
Parts Group approximated 57% of the Company's net sales as compared to 58% for
both 1992 and 1991.
Service to Jobbers. The Company believes that the quality and the range of
services provided to its jobber customers constitute a significant part of its
automotive parts distribution system. Such services include fast and frequent
delivery, obsolescence protection, parts cataloging (including the use of
computerized NAPA Jobber catalogues) and stock adjustment through a continuing
parts classification system which allows jobber customers to return certain
merchandise on a scheduled basis. The Company offers jobbers various
management aids, marketing aids and service on topics such as inventory
control, cost analysis, accounting procedures, group insurance and retirement
benefit plans, marketing conferences and seminars, sales and advertising
manuals and training programs. Point of sale/inventory management is available
through TAMS(R) (Total Automotive Management Systems), a computer system
designed and developed by the Company for the NAPA Jobber.
In association with NAPA, the Company has developed and refined an
inventory classification system to determine optimum distribution center and
jobbing store inventory levels for automotive parts stocking based on
automotive registrations, usage rates, production figures, technological
advances and other similar factors. This system, which undergoes continuous
analytical review, is an integral part of the Company's inventory control
procedures and comprises an important feature of the inventory management
services which the Company makes available to its jobber customers. Over the
last 10 years, losses to the Company from obsolescence have been insignificant,
and the Company attributes this to the successful operation of its
classification system.
Competition. In the distribution of automotive parts, the Company competes
with automobile manufacturers (some of which sell replacement parts for
vehicles built by other manufacturers as well as those which they build
themselves), automobile dealers, warehouse clubs and large automotive parts
retail chains. In addition, the Company competes with the distributing outlets
of parts manufacturers, oil companies, mass merchandisers, including the
national retail chains, and with other parts distributors and jobbers.
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<PAGE> 5
NAPA. The Company is a member of the National Automotive Parts Association, a
voluntary association formed in 1925 to provide nationwide distribution of
automotive replacement parts. NAPA, which neither buys nor sells automotive
parts, functions as a trade association whose members operate 74 distribution
centers located throughout the United States, 65 of which are owned and
operated by the Company. NAPA develops marketing concepts and programs which
may be used by its members. It is not involved in the chain of distribution.
Among the automotive lines which each NAPA member purchases and
distributes are certain lines designated, cataloged, advertised and promoted as
"NAPA" lines. The members are not required to purchase any specific quantity
of parts so designated and may, and do, purchase competitive lines from other
supply sources.
The Company and the other NAPA member use the federally registered
trademark NAPA(R) as part of the trade name of their distribution centers and
jobbing stores. The Company contributes to the Association's national
advertising which is designed to increase public recognition of the "NAPA"
name and to promote "NAPA" product lines.
The Company is a party, together with other members of NAPA and NAPA
itself, to a consent decree entered by the Federal District Court in Detroit,
Michigan, on May 4, 1954. The consent decree enjoins certain practices under
the federal antitrust laws, including the use of exclusive agreements with
manufacturers of automotive parts, allocation or division of territories among
several NAPA members, fixing of prices or terms of sale for such parts among
such members, and agreements to adhere to any uniform policy in selecting
jobbers or determining the number and location of, or arrangements with,
jobbers.
INDUSTRIAL PARTS GROUP
The Industrial Parts Group distributes industrial replacement parts
and related supplies. This Group distributes industrial bearings and fluid
transmission equipment, including hydraulic and pneumatic products, material
handling components, agricultural and irrigation equipment and their related
supplies.
In 1993, the Company distributed industrial parts in the United States
through Motion Industries, Inc. ("Motion"), headquartered in Birmingham,
Alabama and Berry Bearing Company and its affiliates (the "Berry Companies"),
headquartered in Chicago, Illinois. Motion and each of the Berry Companies are
wholly owned subsidiaries of the Genuine Parts Company. In Canada, industrial
parts are distributed by Oliver Industrial Supply Ltd., a wholly owned
subsidiary of Genuine Parts Holdings Ltd., headquartered in Lethbridge,
Alberta.
As of December 31, 1993, the Group served more than 150,000 customers
in all types of industries located throughout the United States, and in Canada,
principally in the Provinces of Alberta, Manitoba and Saskatchewan.
Distribution System. In the United States, the Industrial Parts Group operates
5 distribution centers, two re-distribution centers, 10 service centers for
fluid power and special hose applications and approximately 300 branches.
Distribution centers stock and distribute more than 200,000 different items
purchased from over 250 different suppliers. The Group's re-distribution
centers serve as collection points for excess inventory collected from its
branches for re-distribution to those branches which need the inventory.
Approximately 60% of 1993 total industrial purchases were made from 13 major
suppliers. Sales are generated from the Group's branches located in 36 states,
each of which has warehouse facilities, which stock significant amounts of
inventory representative of the lines of products used by customers in the
respective market area served.
In Canada, Oliver Industial Supply Ltd. ("Oliver") operates an
industrial parts and agricultural supply distribution center for its seven
branches serving the industrial and agricultural markets of Alberta, British
Columbia, Manitoba and Saskatchewan in western Canada. In addition to
industrial parts and agricultural supplies, Oliver distributes irrigation
systems and related supplies.
Products. The Industrial Parts Group distributes a wide variety of products to
its customers, primarily industrial concerns, to maintain and operate plants,
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<PAGE> 6
machinery and equipment. Products include such items as hoses, belts,
bearings, pulleys, pumps, valves, chains, gears, sprockets, speed reducers and
electric motors. The nature of this Group's business demands the maintenance
of large inventories and the ability to provide prompt and demanding delivery
requirements. Virtually all of the products distributed are installed by the
customer. Most orders are filled immediately from existing stock and
deliveries are normally made within 24 hours of receipt of order. The majority
of all sales are on open account.
Related Information. Non-exclusive distributor agreements are in effect with
most of the Group's suppliers. The terms of these agreements vary; however, it
has been the experience of the Group that the custom of the trade is to treat
such agreements as continuing until breached by one party, or until terminated
by mutual consent.
Segment Data. In the year ended December 31, 1993, sales from the Company's
Industrial Parts Group approximated 26% of the Company's net sales as compared
to 27% in both 1992 and 1991.
Competition. The Industrial Parts Group competes with other distributors
specializing in the distribution of such items, as well as with general line
distributors. To a lesser extent, the Group competes with manufacturers that
sell directly to the customer.
OFFICE PRODUCTS GROUP
The Office Products Group, through S. P. Richards Company ("S.P.
Richards"), a wholly owned subsidiary of Genuine Parts Company headquartered in
Atlanta, Georgia, is engaged in the wholesale distribution of a broad line of
office products which are used in the daily operation of businesses, schools,
offices and institutions. Office products fall into the general categories of
computer supplies, office furniture, office machines and general office
supplies.
Computer supplies include diskettes, printer supplies, printout paper
and printout binders. Office furniture includes desks, credenzas, chairs,
chair mats, partitions, files and computer furniture. Office machines include
telephones, answering machines, calculators, typewriters, shredders and
copiers. General office supplies include copier supplies, desk accessories,
business forms, accounting supplies, binders, report covers, writing
instruments, note pads, envelopes, secretarial supplies, mailroom supplies,
filing supplies, art/drafting supplies and audio visual supplies.
S. P. Richards Company distributes more than 17,000 items to over
8,000 office supply dealers from 41 distribution centers located in 28 states.
Approximately 62% of 1993 total office products purchases were made from 14
major suppliers. Effective November 1, 1993, S.P. Richards acquired all of the
assets of Lesker Office Furniture, an office furniture wholesaler with four
distribution centers in Pennsylvania, New Jersey, Virginia and Ohio.
S. P. Richards Company sells to qualified resellers of office
products. Customers are offered comprehensive marketing programs which include
flyers, other promotional material and personalized product catalogs. The
marketing programs are supported by all S. P. Richards' distribution centers
which stock all cataloged products and have the capability to provide overnight
delivery.
While many recognized brand-name items are carried in inventory, S. P.
Richards Company also markets items produced for it under its own SPARCO(R)
brand name, as well as its NATURE SAVER(R) brand of recycled products.
Segment Data. In the year ended December 31, 1993, sales from the Company's
Office Products Group approximated 17% of the Company's net sales as compared
to 15% in both 1992 and 1991.
Competition. In the distribution of office supplies to retail dealers, S. P.
Richards Company competes with many other wholesale distributors as well as
with manufacturers of office products and large national retail chains.
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* * * * * * * *
Executive Officers of the Company. The table below sets forth the name and age
of each person deemed to be an executive officer of the Company as of February
21, 1994, the position or office held by each and the period during which each
has served as such. Each executive officer is elected by the Board of
Directors and serves at the pleasure of the Board of Directors until his
successor has been elected and has qualified, or until his earlier death,
resignation, removal, retirement or disqualification.
<TABLE>
<CAPTION>
Year First
Assumed
Name Age Position of Office Position
- ---- --- ------------------ ----------
<S> <C> <C> <C>
Larry L. Prince 55 Chairman of the Board of Directors
and Chief Executive Officer 1990/1989
Thomas C. Gallagher 46 President and Chief Operating Officer 1990
George W. Kalafut 60 Executive Vice President-Finance and
Administration * 1991
John J. Scalley 63 Executive Vice President 1986
Keith M. Bealmear 47 Group Vice President 1994
Robert J. Breci 58 Group Vice President 1987
Albert T. Donnon, Jr 46 Group Vice President 1993
Louis W. Rice, Jr 67 Senior Vice President-Personnel 1981
</TABLE>
* Also serves as the Company's Principal Financial Officer.
All executive officers have been employed by and have served as officers
of the Company for at least the last five years.
ITEM 2. PROPERTIES.
The Company's headquarters are located in one of two adjacent office
buildings owned by Genuine Parts Company in Atlanta, Georgia.
The Company's Automotive Parts Group operates 65 NAPA Distribution
Centers in the United States distributed among nine geographic divisions. More
than 90% of these distribution centers are owned by the Company. At December
31, 1993, the Company owned 683 jobbing stores located in 40 states, and
Genuine Parts Company owned a 51% interest in 59 jobbing stores located in 26
states. Other than jobbing stores located within Company owned distribution
centers, most of the jobbing stores were operated in leased facilities. In
addition, UAP/NAPA, in which Genuine Parts Company owns a minority interest,
operated 81 jobbing stores in Western Canada. The Company's Automotive Parts
Group also operates three Balkamp distribution centers, six Rayloc rebuilding
plants, two transfer and shipping facilities and a Rayloc warehouse.
The Company's Industrial Parts Group, operating through Motion and the
Berry Companies, operates five distribution centers, two re-distribution
centers, 10 service centers and approximately 300 branches. Approximately 80%
of these branches are operated in leased facilities. In addition, the
Industrial Parts Group operates an industrial parts and agricultural supply
distribution center in Western Canada for its seven branches of which
approximately 85% are operated in leased facilities.
The Company's Office Products Group operates 41 distribution centers in
the United States distributed among the Group's five geographic divisions.
Approximately 75% of these distribution centers are operated in leased
facilities.
For additional information regarding rental expense on leased properties,
see "Note 5 of Notes to Consolidated Financial Statements" on Page 24 of
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Annual Report to Shareholders for 1993.
ITEM 3. LEGAL PROCEEDINGS.
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not Applicable.
PART II.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCK-
HOLDER MATTERS.
Information required by this item is set forth under the heading
"Market and Dividend Information" on Page 18 of Annual Report to Shareholders
for the year ended December 31, 1993, and is incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA.
Information required by this item is set forth under the heading
"Selected Financial Data" on Page 18 of Annual Report to Shareholders for the
year ended December 31, 1993, and is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
Information required by this item is set forth under the heading
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" on Page 26 of Annual Report to Shareholders for the year ended
December 31, 1993, and is incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Information required by this item is set forth in the consolidated
financial statements on Pages 20 through 25 and Page 27, in "Report of
Independent Auditors" on Page 19, and under the heading "Quarterly Results of
Operations" on Page 27, of the Annual Report to Shareholders for the year ended
December 31, 1993, and is incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
Not Applicable.
PART III.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
Information required by this item is set forth on Pages 1 through 6,
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and Page 16 of the definitive proxy statement for the Company's Annual Meeting
to be held on April 18, 1994, and is incorporated herein by reference. Certain
information about Executive Officers of the Company is included in Item 1 of
Part I of this Annual Report on Form 10-K.
ITEM 11. EXECUTIVE COMPENSATION.
Information required by this item is set forth on Page 5, and on
Pages 7 through 16 of the definitive proxy statement for the Company's Annual
Meeting to be held on April 18, 1994, and is incorporated herein by reference.
In no event shall the information contained in the definitive proxy statement
for the Company's 1994 Annual Meeting on Pages 9 through 11 under the heading
"Compensation and Stock Option Committee Report on Executive Compensation" or
on Pages 15 and 16 under the heading "Performance Graph" be incorporated herein
by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
Information required by this item is set forth on Pages 5 and 6 of
the definitive proxy statement for the Company's Annual Meeting to be held on
April 18, 1994, and is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Information required by this item is set forth on Page 16 of the
definitive proxy statement for the Company's Annual Meeting to be held on April
18, 1994, and is incorporated herein by reference.
PART IV.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 10-K.
(a) (1) and (2) The response to this portion of Item 14 is submitted as
a separate section of this report.
(3) The following Exhibits are filed as part of this report in Item
14(c):
Exhibit 3.1.1 Restated Articles of Incorporation of the Company,
dated as of April 18, 1988, and as amended April
17, 1989. (Incorporated herein by reference from
the Company's Quarterly Report on Form 10-Q, dated
May 8, 1989).
Exhibit 3.1.2 Amendment to the Restated Articles of Incorporation
of the Company, dated as of November 20, 1989.
(Incorporated herein by reference from the
Company's Annual Report on Form 10-K, dated March
12, 1990).
Exhibit 3.2 By-laws of the Company, as amended. (Incorporated
herein by reference from the Company's Annual
Report on Form 10-K, dated March 5, 1993).
Exhibit 4.1 Shareholder Protection Rights Agreement, dated as
of November 20, 1989, between the Company and Trust
Company Bank, as Rights Agent. (Incorporated
herein by reference
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from the Company's Report on Form 8-K, dated
November 20, 1989).
Exhibit 10.1 * Incentive Stock Option Plan. (Incorporated herein
by reference from the Company's Annual Meeting
Proxy Statement, dated March 12, 1982).
Exhibit 10.2 * 1988 Stock Option Plan. (Incorporated herein by
reference from the Company's Annual Meeting Proxy
Statement, dated March 9, 1988).
Exhibit 10.3 * Form of Amendment to Executive Supplemental
Retirement Income Agreement adopted February 13,
1989, between the Company and William C. Hatcher.
(Incorporated herein by reference from the
Company's Annual Report on Form 10-K, dated March
15, 1989).
Exhibit 10.4 * Form of Amendment to Deferred Compensation
Agreement, adopted February 13, 1989, between the
Company and certain executive officers of the
Company. (Incorporated herein by reference from
the Company's Annual Report on Form 10-K, dated
March 15, 1989).
Exhibit 10.5 * Form of Agreement adopted February 13, 1989,
between the Company and certain executive officers
of the Company providing for a supplemental
employee benefit upon a change in control of the
Company. (Incorporated herein by reference from
the Company's Annual Report on Form 10-K, dated
March 15, 1989).
Exhibit 10.6 * Genuine Parts Company Partnership Plan, effective
July 1, 1988. (Incorporated herein by reference
from the Company's Annual Report on Form 10-K,
dated March 15, 1989).
Exhibit 10.7 * Genuine Parts Company Supplemental Retirement Plan,
effective January 1, 1991. (Incorporated herein by
reference from the Company's Annual Report on Form
10-K, dated March 8, 1991).
Exhibit 10.8 * 1992 Stock Option and Incentive Plan, effective
April 20, 1992. (Incorporated herein by reference
from the Company's Annual Meeting Proxy Statement,
dated March 6, 1992).
Exhibit 10.9 * The Genuine Parts Company Tax-Deferred Savings
Plan, effective January 1, 1993.
* Indicates executive compensation plans and
arrangements
Exhibit 13 The following sections and pages of the 1993 Annual
Report to Shareholders:
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- Selected Financial Data on Page 18
- Market and Dividend Information on Page 18
- Report of Independent Auditors of Page 19
- Consolidated Financial Statements and Notes to
Consolidated Financial Statements on Pages
20 - 25
- Management's Discussion and Analysis of
Financial Condition and Results of Operations on
Page 26
- Industry Data Information on Page 27
- Quarterly Results of Operations on Page 27
Exhibit 22 Subsidiaries of the Company
Exhibit 24 Consent of Independent Auditors
(b) Reports on Form 8-K. No reports on Form 8-K were filed by the
Registrant during the last quarter of the fiscal year.
(c) Exhibits. The response to this portion of Item 14 is submitted as a
separate section of this report.
(d) Financial Statement Schedules. The response to this portion of Item
14 is submitted as a separate section of this report.
SIGNATURES.
Pursuant to the requirements of Section 13 or 15(d) 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
/s/Larry L. Prince 3/4/94 /s/George W. Kalafut 3/4/94
- ------------------------------------- ------------------------------------
Larry L. Prince (Date) George W. Kalafut (Date)
Chairman of the Board Executive Vice President -
and Chief Executive Officer Finance and Administration and
Principal Financial Officer
-11-
<PAGE> 12
Pursuant to the requirements of the Securities and Exchange Act of 1934,
this Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
/s/James R. Courim 2/21/94 /s/William A. Parker 2/21/94
- ------------------------------------- ------------------------------------
James R. Courim (Date) William A. Parker (Date)
Director Director
/s/Bradley Currey, Jr. 2/21/94 /s/Larry L. Prince 2/21/94
- ------------------------------------- ------------------------------------
Bradley Currey, Jr. (Date) Larry L. Prince (Date)
Director Director
Chairman of the Board and
Chief Executive Officer
/s/Jean Douville 2/21/94 /s/John J. Scalley 2/21/94
- ------------------------------------- ------------------------------------
Jean Douville (Date) John J. Scalley (Date)
Director Director
Chairman of the Board and Executive Vice President
Chief Executive Officer UAP INC.
/s/John B. Ellis 2/21/94 /s/Alana S. Shepherd 2/21/94
- ------------------------------------- ------------------------------------
John B. Ellis (Date) Alana S. Shepherd (Date)
Director Director
/s/Thomas C. Gallagher 2/21/94 /s/Lawrence G. Steiner 2/21/94
- ------------------------------------- ------------------------------------
Thomas C. Gallagher (Date) Lawrence G. Steiner (Date)
Director Director
President and Chief Operating Officer
/s/E. Reginald Hancock 2/21/94 /s/James B. Williams 2/21/94
- ------------------------------------- ------------------------------------
E. Reginald Hancock (Date) James B. Williams (Date)
Director Director
/s/Gardner E. Larned 2/21/94
- -------------------------------------
Gardner E. Larned (Date)
Chairman of the Board and
Chief Executive Officer of Berry
Bearing Company and Its Affiliates
-12-
<PAGE> 13
ANNUAL REPORT ON FORM-10-K
ITEM 14(a)(1) AND (2), (c) AND (d)
LIST OF FINANCIAL STATEMENTS AND
FINANCIAL STATEMENT SCHEDULE
CERTAIN EXHIBITS
FINANCIAL STATEMENT SCHEDULE
YEAR ENDED DECEMBER 31, 1993
GENUINE PARTS COMPANY
ATLANTA, GEORGIA
<PAGE> 14
FORM 10-K - ITEM 14(A)(1) AND (2)
GENUINE PARTS COMPANY AND SUBSIDIARIES
INDEX OF FINANCIAL STATEMENTS
The following consolidated financial statements of Genuine Parts Company and
subsidiaries, included in the annual report of the registrant to its
shareholders for the year ended December 31, 1993, are incorporated by
reference in Item 8:
Consolidated balance sheets -- December 31, 1993 and 1992
Consolidated statements of income -- Years ended December 31, 1993,
1992 and 1991
Consolidated statements of shareholders' equity -- Years ended December
31, 1993, 1992 and 1991
Consolidated statements of cash flows -- Years ended December 31, 1993,
1992 and 1991
Notes to consolidated financial statements -- December 31, 1993
The following consolidated financial statement schedule of Genuine Parts
Company and subsidiaries is included in Item 14(d):
Schedule IX - Short-term borrowings
All other schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable, and therefore have been omitted.
<PAGE> 15
ANNUAL REPORT ON FORM 10-K
ITEM 14(a)(3)
LIST OF EXHIBITS
The following Exhibits are filed as a part of this Report:
10.9* The Genuine Parts Company Tax-Deferred Savings Plan, effective
January 1, 1993
13 The following Sections and Pages of Annual Report to Shareholders
for 1993:
- Selected Financial Data on Page 18
- Market and Dividend Information on Page 18
- Report of Independent Auditors on Page 19
- Consolidated Financial Statements and Notes to Consolidated
Financial Statements on Pages 20-25
- Management's Discussion and Analysis of Financial Condition
and Results of Operations on Page 26
- Industry Data Information on Page 27
- Quarterly Results of Operations on Page 27
22 Subsidiaries of the Company
24 Consent of Independent Accountants
The following Exhibits are incorporated by reference as set forth in Item 14 on
pages 9 and 10 of this Form 10-K:
- 3.1.1 Restated Articles of Incorporation of the Company, dated as
of April 18, 1988, and as amended April 17, 1989.
- 3.1.2 Amendment to the Articles of Incorporation of the Company,
dated as of November 20, 1989.
- 3.2 By-laws of the Company, as amended.
- 4.1 Shareholder Protection Rights Agreement, dated as of
November 20, 1989, between the Company and Trust Company
Bank, as Rights Agent.
- 10.1* Incentive Stock Option Plan.
- 10.2* 1988 Stock Option Plan.
- 10.3* Form of Amendment to Executive Supplemental Retirement
Income Agreement adopted February 13, 1989, between the
Company and William C. Hatcher and Earl Dolive.
- 10.4* Form of Amendment to Deferred Compensation Agreement
adopted February 13, 1989, between the Company and certain
executive officers of the Company.
- 10.5* Form of Agreement adopted February 13, 1989, between the
Company and certain executive officers of the Company
providing for a supplemental employee benefit upon a
change in control of the Company.
- 10.6* Genuine Parts Company Partnership Plan, effective July 1,
1988.
<PAGE> 16
- 10.7* Genuine Parts Company Supplemental Retirement Plan,
effective January 1, 1991.
- 10.8* 1992 Stock Option and Incentive Plan, effective April 20,
1992.
* Indicates executive compensation plans and arrangements
<PAGE> 1
EXHIBIT 10.9
THE GENUINE PARTS COMPANY
TAX-DEFERRED SAVINGS PLAN
ARTICLE 1
ESTABLISHMENT OF PLAN
1.01 Background of Plan. Genuine Parts Company hereby establishes,
effective as of January 1, 1993, a deferred compensation plan known as
The Genuine Parts Company Tax-Deferred Savings Plan. The purpose of
the Plan is to help the Company retain employees of outstanding
ability.
1.02 Status of Plan. The Plan is intended to be a nonqualified, unfunded
plan of deferred compensation under the Internal Revenue Code of 1986,
as amended. Also, because the only persons who may participate in
this Plan are members of a select group of management or highly
compensated employees, this Plan of deferred compensation is not
subject to Parts 2, 3 and 4 of Subtitle B of Title I of the Employee
Retirement Income Security Act of 1974.
1.03 Establishment of Trust. The Company has established a trust to fund
benefits provided under the terms of the Plan ("Trust"). It is
intended that the transfer of assets into the Trust will not generate
taxable income (for federal income tax purposes) to the Participants
until such assets are actually distributed or otherwise made available
to the Participants.
ARTICLE 2
DEFINITIONS
Certain terms of this Plan have defined meanings which are set forth
in this Article and which shall govern unless the context in which
they are used clearly indicates that some other meaning is intended.
Account. The bookkeeping account to which compensation is deferred by
a Participant shall be recorded and in which income or loss shall be
credited in accordance with the Plan.
Beneficiary. Any person or persons designated by a Participant, in
accordance with procedures established by the Committee, to receive
benefits hereunder in the event of the Participant's death. If any
Participant shall fail to designate a Beneficiary or shall designate a
Beneficiary who shall fail to survive the Participant, distribution of
benefits will be made in accordance with the payment distribution
rules set forth in the Genuine Partnership Plan.
<PAGE> 2
Bonus. A Participant's bonus paid as part of a Company bonus program
for executives and other key employees. The term bonus does not
include extraordinary payments to a Participant and does not include a
Participant's wages or salary unless the Plan Committee designates
such payments as a Bonus for purposes of this Plan. Any such
designation must be made in advance of the Participant earning such
payment.
Committee. The Plan Committee is the Committee that will administer
and interpret the terms of the Plan.
Company. Genuine Parts Company and its corporate successors.
Compensation & Stock Option Committee. The Compensation & Stock Option
Committee of the Board of Directors of the Company.
Effective Date. January 1, 1993.
Election Form. A form substantially the same as the form attached to
this Plan as Exhibit A.
Key Employee. Any full-time employee of the Company designated as a
Key Employee by the Plan Committee.
Participant. Any Key Employee who is participating in this Plan.
Plan. The Genuine Parts Company Tax-Deferred Savings Plan as set forth
in this document together with any subsequent amendments hereto.
Termination of Service. A Key Employee who has ceased to serve as an
employee of the Company for any reason.
ARTICLE 3
PARTICIPATION
3.01 Participation.
(a) In General. The only persons who may participate in this
Plan are Key Employees of the Company who are designated as
such by the Plan Committee. Upon becoming eligible to
participate, a Key Employee must complete an Election Form.
The Key Employee's participation shall commence on the date
specified in this Article 3. Even though a Key Employee may
be a Participant in this Plan, the Participant shall not be
entitled to any benefit hereunder unless such Participant has
properly completed an Election Form and deferred the receipt
of his or her Bonus pursuant to the Plan.
- 2 -
<PAGE> 3
(b) Completion of Election Form. A Key Employee may participate
in the Plan after delivering a properly completed and signed
Election Form to the Committee. The Election Form shall be
signed and delivered to the Committee prior to the first day
of the calendar year with respect to which the Bonus will be
earned. The Key Employee's participation in the Plan will be
effective as of the first day of the calendar year which
commences after the Committee's receipt of the Key Employee's
Election Form.
(c) Election After Plan is Approved. Notwithstanding paragraph
(b), any Election Form which is delivered to the Committee
within thirty days of the Company's approval of the Plan and
prior to the end of the calendar year in which such approval
is given shall be valid and shall apply to the Bonus which
would ordinarily be paid to the Participant in the following
calendar year. However, such bonus deferral shall be limited
to the amount or percentage set forth in Section 4.01.
(d) Voluntary Termination of Election Form. A Participant may
terminate his or her Election Form at any time. If a
Participant terminates his or her Election Form, however, the
Participant may not execute a new Election Form to defer his
or her Bonus for the remainder of the calendar year in which
the Participant's Election Form is terminated. However,
effective as of the first day of the following calendar year
or the first day of any subsequent calendar year, the
Participant may execute a new Election Form and thereby defer
the receipt of any future Bonus attributable to the
Participant's employment. Such Election Form shall be
effective only for Bonus applicable to the Participant's
employment after the first day of the calendar year following
the Committee's receipt of the Participant's Election Form.
(e) Continuation of Election Form. A Participant shall have the
right to modify the dollar amount or percentage of his or her
Bonus which is deferred under the Plan prior to the
commencement of each calendar year. If the Participant fails
to execute a new Election Form prior to the commencement of
the new calendar year, the Participant's Election Form in
effect during the previous calendar year shall continue in
effect during the new calendar year.
(f) Automatic Termination of Election Form. The Participant's
Election Form will automatically terminate at (i) the
Participant's Termination of Service, (ii) the date the Plan
Committee determines that the Participant is no longer a Key
Employee under the Plan, (iii) the termination of the Plan, or
(iv) when benefits are paid out in accordance with the
distribution rules established by the participant in his or
her Election Form.
- 3 -
<PAGE> 4
(g) Nothing contained in the Plan shall be deemed to give any Key
Employee the right to be retained as an employee of the
Company.
ARTICLE 4
PLAN BENEFITS
4.01 Deferred Bonus. A Key Employee may elect to defer any dollar amount
or percentage of his or her Bonus in accordance with the terms of the
Plan and the Election Form. However, for the Bonuses paid in 1994, a
Key Employee may elect to defer a maximum of 50% of the Key Employee's
Bonus. For bookkeeping purposes, the amount of the Bonus which the
Key Employee elects to defer pursuant to this Plan shall be
transferred to and held in individual Accounts.
4.02 Investment. The Committee shall direct the investment of all
Accounts. As of the last day of each calendar quarter and on such
other dates selected by the Committee, the Committee shall credit each
Participant's Account with earnings, losses and changes in fair market
value experienced by the investment alternative selected by the
Committee.
4.03 Form of Payment.
(a) Payment Election. Payment of Plan benefits shall commence on
the date the Participant selects on the Election Form. Any
date selected by the Participant must be at least two calendar
years following the date the Bonus would ordinarily be paid.
If the participant fails to select a benefit commencement date
on the Election Form, the participant's account shall commence
to be distributed on the first regular business day of the
fourth month following the Participant's Termination of
Service. For example, if a Participant has a Termination of
Service on January 12, payment of plan benefits would commence
on May 1 (the fourth month following January 12).
(b) Optional Forms of Payment. The amount of the Participant's
Account shall be paid to the Participant either in a lump sum
or in a number of approximately equal annual installments
designated by the Participant on the Election Form. Such
annual installments may be for 5 years, 10 years or 15 years.
If the Participant fails to designate a payment method in the
Election Form, the Participant's Account shall be distributed
in a lump sum.
(c) Multiple Elections. A Participant may elect a different
payment commencement date for each Bonus deferred under this
Plan. In addition, a Participant may elect a different
payment form for each Bonus deferred under this Plan. The
Committee shall
- 4 -
<PAGE> 5
establish sub-accounts within a Participant's Account (to the
extent necessary) to identify the portion of a Participant's
Account that will be distributed as of the dates and in the
form the Participant designates in the Election Form. A
Participant may not modify or otherwise revoke the benefit
commencement date and payment form designated on an Election
Form after the Participant delivers such Election Form to the
Committee.
(d) Acceleration of Payment. If a Participant elects an
installment distribution and the annual installment payment
elected by the Participant would result in an annual payment
of less than $5,000, the Committee shall accelerate payment of
the Participant's benefits over a lesser number of whole years
(but in increments of 5 or 10 years) so that the annual amount
paid is at least $5,000. If payment of the Participant's
benefits over a 5 year period will not provide annual payments
of at least $5,000, the Participant's Account shall be paid in
a lump sum.
(e) Payment to Beneficiary. Upon the Participant's death, all
unpaid amounts held in the Participant's Account shall be paid
to the Participant's beneficiary in the same benefit payment
form the Participant elected on the Election Form and in
accordance with the payment distribution rules set forth in
this Plan. Such payment will be commence to be paid on the
first business day of the fourth month following the
Participant's death.
4.04 Financial Hardship. The Committee may, in its sole discretion,
accelerate the making of payment to a Participant of an amount
reasonably necessary to handle a severe financial hardship of a sudden
and unexpected nature due to causes not within the control of the
Participant. Such payment may be made even if the Participant has not
incurred a Termination of Service. All financial hardship
distributions shall be made in a lump sum. Such payments will be made
on a first-in, first-out basis so that the oldest Bonus deferred under
the Plan shall be deemed distributed first in a financial hardship.
4.05 Payment to Minors and Incapacitated Persons. In the event that any
amount is payable to a minor or to any person who, in the judgment of
the Committee, is incapable of making proper disposition thereof, such
payment shall be made for the benefit of such minor or such person in
any of the following ways as the Committee, in its sole discretion,
shall determine:
(a) By payment to the legal representative of such minor or such
person;
(b) By payment directly to such minor or such person;
- 5 -
<PAGE> 6
(c) By payment in discharge of bills incurred by or for the
benefit of such minor or such person. The Committee shall
make such payments without the necessary intervention of any
guardian or like fiduciary, and without any obligation to
require bond or to see to the further application of such
payment. Any payment so made shall be in complete discharge
of the Plan's obligation to the Participant and his or her
Beneficiaries.
4.06 Application for Benefits. The Committee may require a Participant or
Beneficiary to complete and file certain forms as a condition
precedent to receiving the payment of benefits. The Committee may
rely upon all such information given to it, including the
Participant's current mailing address. It is the responsibility of
all persons interested in receiving a distribution pursuant to the
Plan to keep the Committee informed of their current mailing
addresses.
4.07 Designation of Beneficiary. Each Participant from time to time may
designate any person or persons (who may be designated contingently or
successively and who may be an entity other than a natural person) as
his or her Beneficiary or Beneficiaries to whom the Participant's
Account is to be paid if the Participant dies before receipt of all
such benefits. Each Beneficiary designation shall be on the form
prescribed by the Committee and will be effective only when filed with
the Committee during the Participant's lifetime. Each Beneficiary
designation filed with the Committee will cancel all Beneficiary
designations previously filed with the Committee. The revocation of a
Beneficiary designation, no matter how effected, shall not require the
consent of any designated Beneficiary.
ARTICLE 5
FUNDING OF PLAN
5.01 The benefits provided by this Plan shall be paid from the general
assets of the Company or as otherwise directed by the Company. To the
extent that any Participant acquires the right to receive payments
under the Plan (from whatever source), such right shall be no greater
than that of an unsecured general creditor of the Company.
Participants and their Beneficiaries shall not have any preference or
security interest in the assets of the Company other than as a general
unsecured creditor.
- 6 -
<PAGE> 7
ARTICLE 6
ADMINISTRATION OF THE PLAN
6.01 The Committee shall have complete control of the administration of the
Plan with all powers necessary to enable it to properly carry out the
provisions of the Plan. In addition to all implied powers and
responsibilities necessary to carry out the objectives of the Plan,
the Committee shall have the following specific powers and
responsibilities:
(1) To construe the Plan and to determine all questions
arising in the administration, interpretation and operation of the
Plan;
(2) To designate participants in the Plan;
(3) To determine the benefits of the Plan to which any
Participant, Beneficiary or other person may be entitled;
(4) To keep records of all acts and determinations of the
Committee, and to keep all such records, books of accounts, data and
other documents as may be necessary for the proper administration of
the Plan;
(5) To prepare and distribute to all Participants and
Beneficiaries information concerning the Plan and their rights under
the Plan;
(6) To do all things necessary to operate and administer
the Plan in accordance with its provisions.
ARTICLE 7
AMENDMENT AND TERMINATION
7.01 The Compensation & Stock Option Committee reserves the right to
modify, alter, amend, or terminate the Plan, at any time and from time
to time, without notice, to any extent deemed advisable; provided,
however, that no such amendment or termination shall (without the
written consent of the Participant, if living, and if not, the
Participant's Beneficiary) adversely affect any benefit under the Plan
which has accrued with respect to the Participant or Beneficiary as of
the date of such amendment or termination regardless of whether such
benefit is in pay status. Notwithstanding the foregoing, no
amendment, modification, alteration, or termination of this Plan may
be given effect with respect to any Participant without the consent of
such Participant if such amendment, modification, alteration, or
termination is adopted during the six-month period prior to a Change
of Control or during the two-year period following a Change of
Control.
- 7 -
<PAGE> 8
ARTICLE 8
CHANGE IN CONTROL
8.01 Change of Control.
(a) Notwithstanding any other provisions in this Plan, in the
event there is a Change of Control of the Company as defined
in subsection (c) of this Section 8.01, any Participant whose
employment is terminated on account of such Change of Control
may, at the discretion of the Compensation & Stock Option
Committee, receive an immediate lump sum payment of the
Participant's Account balance. For purposes of this Section
8.01(a), a Participant's employment shall be considered to
have "terminated on account of such Change of Control" only if
the Participant's employment with the Employer is terminated
without cause during the 24 month period following the Change
of Control.
(b) Notwithstanding any other provisions in this Plan, in the
event there is a change of control of the Company as defined
in subsection (c) of this Section 8.01, any Participant who
has commenced receiving installment distributions from the
Company may, at the discretion of the Compensation & Stock
Option Committee immediately receive a lump sum payment in an
amount equal to the unpaid balance of the Participant's
Account.
(c) A Change of Control of the Company shall mean a change of
control of a nature that would require to be reported in
response to item 6(e) of Schedule 14A of Regulation 14A
promulgated under the Securities Exchange Act of 1934 (the
"Exchange Act"). In addition, whether or not required to be
reported thereunder, a Change of Control shall be deemed to
have occurred at such time as (i) any "person" (as that term
is used in Section 13(d)(2) of the Exchange Act) is or becomes
the beneficial owner (as defined in rule 13(d)-3 of the
Exchange Act) directly or indirectly of securities
representing 20% or more of the combined voting power for
election of directors of the then outstanding securities of
the Company or any successor of the Company (ii) during any
period of two consecutive years or less individuals who at the
beginning of such period constituted the board of directors of
the Company cease, for any reason, to constitute at least a
majority of the board of directors, unless the election or
nomination for election of each new director was approved by a
vote of at least two-thirds of the directors then still in
office who were directors at the beginning of the period;
(iii) the shareholders of the Company approve any merger or
consolidation as a result of which the capital stock of the
Company shall be changed, converted or exchanged (other than a
merger with a
- 8 -
<PAGE> 9
wholly-owned subsidiary of the Company) or any liquidation of
the Company or any sales or other disposition of 50% or more
of the assets or earning power of the Company; or (iv) the
shareholders of the Company approve any merger or
consolidation to which the Company is a party as a result of
which the persons who were shareholders of the Company
immediately prior to the effective date of the merger or
consolidation shall have beneficial ownership of less than 50%
of the combined voting power for election of directors of the
surviving corporation following the effective date of such
merger or consolidation. Notwithstanding any provisions in
this subparagraph (c), in the event the Company and a
Participant agree prior to any event which would otherwise
constitute a Change of control, that such event shall not
constitute a Change of Control, then for purposes of this Plan
there shall be no such Change of Control upon that event.
ARTICLE 9
MISCELLANEOUS
9.01 Headings. The headings and sub-headings in this Plan have been
inserted for convenience of reference only and are to be ignored in
any construction of the provisions hereof.
9.02 Spendthrift Clause. None of the benefits, payments, proceeds or
distribution under this Plan shall be subject to the claim of any
creditor of any Participant or Beneficiary, or to any legal process by
any creditor of such Participant or Beneficiary, and none of them
shall have any right to alienate, commute, anticipate or assign any of
the benefits, payments, proceeds or distributions under this Plan
except to the extent expressly provided herein to the contrary.
9.03 Merger. The Plan shall not be automatically terminated by the
Company's acquisition by, merger into, or sale of substantially all of
its assets to any other organization, but the Plan shall be continued
thereafter by such successor organization. All rights to amend,
modify, suspend or terminate the Plan shall be transferred to the
successor organization, effective as of the date of the combination or
sale.
9.04 Release. Any payment to Participant or Beneficiary, or to their legal
representatives, in accordance with the provisions of this Plan, shall
to the extent thereof be in full satisfaction of all claims hereunder
against the Committee and the Company, any of whom may require such
Participant, Beneficiary, or legal representative, as a condition
precedent to such payment, to execute a receipt and release therefor
in such form as shall be determined by the Committee, or the Company,
as the case may be.
- 9 -
<PAGE> 10
9.05 Governing Law. The Plan shall be governed by the laws of the State of
Georgia.
9.06 Costs of Collection; Interest. In the event the Participant collects
any part or all of the payments due under this Plan by or through a
lawyer or lawyers, the Company will pay all costs of collection,
including reasonable legal fees incurred by the Participant. In
addition, the Company shall pay to the Participant interest on all or
any part of the payments that are not paid when due at a rate equal to
the Prime Rate as announced by Trust Company Bank or its successors
from time to time.
9.07 Successors and Assigns. This Plan shall be binding upon the
successors and assigns of the parties hereto.
IN WITNESS WHEREOF, the Company has caused this Plan to be duly
executed and its seal to be hereunto affixed on the date indicated below, but
effective as of January 1, 1993.
GENUINE PARTS COMPANY
By: /s/
--------------------------------
Title:
-----------------------------
Date:
------------------------------
[CORPORATE SEAL]
Attest:
- ------------------------------------
- 10 -
<PAGE> 11
<TABLE>
<S> <C> <C>
(LOGO) GENUINE TAX-DEFERRED SAVINGS PLAN
PARTS 1993 PARTICIPATION AGREEMENT
COMPANY
Complete this form before December 31, 1993, and return to Frank Howard in Atlanta. Please print.
PERSONAL INFORMATION
Name: ____________________________________________________________________________________________________________________________
Home Address: ____________________________________________________________________________________________________________________
City: ____________________________________________ State: __________________________________ ZIP Code: _______________________
Social Security Number: __________________________ Daytime Phone: __________________________ Office Location: ________________
PARTICIPATION CHOICE
I wish to participate in the Genuine Parts Company Tax-Deferred Savings Plan during the 1993 calendar year. I wish to defer
a portion of the annual bonus that I earn during 1993 that I would otherwise receive in February, 1994. I understand that I may
rescind this participation agreement at any time during 1993, but that I may not change it in any other way.
I wish to defer receiving ________________ percent (a whole percent from 1 to 50) of the annual bonus I earn during 1993.
LENGTH OF DEFERRAL
I wish to defer receiving this amount until (check one):
/ / ___________________ (this date must be in 1996 or later).
/ / I retire or otherwise terminate employment.
PAYMENT METHOD
I wish to receive this deferral (check one):
/ / in a lump sum. / / in installments over 5 years. / / in installments over 10 years. / / in installments over 15 years.
BENEFICIARY DESIGNATION
Upon my death, I understand that my account balance will be payable to my beneficiary in the payment method chosen on this
form. I name the following individual(s) (or trust) as my primary beneficiary(ies) and have stated the percentage payable (not to
exceed 100% in total). In the event no primary beneficiary survives me to recieve my account balance, I name the following
individual(s) (or trust) as my contingent beneficiary(ies) and have stated the percentage payable (not to exceed 100% in total). Use
separate page if you name more than two in each category. I also understand that if no primary or contingent beneficiary survives
me that my account balance will be paid to my beneficiary under the Genuine Partnership Plan. I also understand that I may have only
one beneficiary designation in effect for my entire benefit form the plan, and that the beneficiary designation on this form revokes
all prior beneficiary designations I have made under this plan.
PRIMARY BENEFICIARY
Name: ______________________________________ Relationship to You: ____________________ Social Security Number: _________________
Address: ______________________________________________________________________________ Percentage Payable: _____________________
Name: ______________________________________ Relationship to You: ____________________ Social Security Number: _________________
Address: ______________________________________________________________________________ Percentage Payable: _____________________
CONTINGENT BENEFICIARY
Name: ______________________________________ Relationship to You: ____________________ Social Security Number: _________________
Address: ______________________________________________________________________________ Percentage Payable: _____________________
Name: ______________________________________ Relationship to You: ____________________ Social Security Number: _________________
Address: ______________________________________________________________________________ Percentage Payable: _____________________
SIGNATURE
I have received and reviewed a summary of the plan provisions, and I have a full understanding of the benefits offered under the
plan. I further understand all the terms and conditions of participating in the plan and receiving benefits under the plan. I
understand that my own elective deferrals and investment earnings may be forfeited in favor of the Company's creditors in the event
of the Company's bankruptcy. I further understand that my contributions to this plan will have an effect on my W-2 cash compensation
amount. I also understand it is to my advantage to maximize my contributions to the Genuine Partnership Plan before contributing any
amounts to this plan. While I understand that this plan is intended as a mechanism to allow me to defer all or a portion of my
annual bonus until I receive my deferred amount(s), I understand that the Company does not guarantee favorable tax consequences, and
that I have been advised to consult my own tax advisor about the advisability of my participation in the plan and its tax effects.
Employee Signature: ________________________________________________________________________ Date: ______________________________
TO BE COMPLETED BY THE COMPANY
Effective Date: ___________________________________________ For the Plan Committee: _____________________________________________
Make a copy of your completed form for your records
</TABLE>
<PAGE> 1
EXHIBIT 13
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
SELECTED FINANCIAL DATA
(restated to give effect to pooling of interests)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
Year Ended December 31
(in thousands except per share data) 1993 1992 1991 1990 1989
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net sales $4,384,294 $4,016,751 $3,763,736 $ 3,660,443 $3,485,289
Cost of goods sold 3,023,038 2,781,731 2,612,059 2,543,951 2,433,393
Selling, administrative
and other expenses 935,427 852,610 790,559 755,051 704,423
Income before income taxes 425,829 382,410 361,118 361,441 347,473
Income taxes 166,961 145,440 137,154 137,718 132,210
Net income** $ 257,813 $ 236,970 $ 223,964 $ 223,723 $ 215,263
Average common shares outstanding during year* 124,217 124,085 123,980 125,262 125,750
Per common share*:
Net income** $ 2.08 $ 1.91 $ 1.81 $ 1.79 $ 1.71
Dividends declared 1.06 1.00 .97 .92 .80
December 31 closing stock price 37.63 34.00 32.50 25.33 28.00
Long-term debt, less current maturities 12,265 13,043 12,658 16,369 17,168
Shareholders' equity 1,445,263 1,316,372 1,211,716 1,122,182 1,058,238
Total assets $1,870,756 $1,707,303 $1,577,516 $ 1,488,412 $1,426,708
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Adjusted to reflect the three-for-two split in 1992.
** Net of cumulative effect of changes in accounting principles of $1,055 in
1993.
SELECTED RATIO ANALYSIS
(restated to give effect to pooling of interests)
<TABLE>
<CAPTION>
Year Ended December 31
1993 1992 1991 1990 1989
- ---------------------------------------------------------------------------------------------------------------------------
(In % of net sales)
<S> <C> <C> <C> <C> <C>
Cost of goods sold 68.95% 69.25% 69.40% 69.50% 69.82%
Selling, administrative and other expenses 21.34 21.23 21.00 20.63 20.21
Income before income taxes 9.71 9.52 9.60 9.87 9.97
Net income 5.88 5.90 5.95 6.11 6.18
Rate earned on shareholders' equity at the beginning of
each year 19.59% 19.56% 19.96% 21.14% 22.62%
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
MARKET AND DIVIDEND INFORMATION
High and Low Sales Price and Dividends Declared per Share of Common Shares
Traded on the New York Stock Exchange. Adjusted to reflect the three-for-two
stock split in 1992.
<TABLE>
<CAPTION>
Sales Price of Common Shares
----------------------------------------------------
Quarter 1993 1992
- ------- ----------------------------------------------------
High Low High Low
----------------------------------------------------
<S> <C> <C> <C> <C>
First $37.25 $32.88 $33.67 $29.50
Second 37.38 33.50 33.50 30.33
Third 38.25 34.50 32.50 29.50
Fourth 39.00 34.88 34.75 29.00
Dividends Declared per Share
----------------------------------------------------
1993 1992
----------------------------------------------------
First $.265 $.25
Second .265 .25
Third .265 .25
Fourth .265 .25
Number of Record Holders of Common Stock 7,594
</TABLE>
18
<PAGE> 2
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT AUDITORS
Board of Directors
Genuine Parts Company
We have audited the accompanying consolidated balance sheets of
Genuine Parts Company and subsidiaries as of December 31, 1993 and 1992, and
the related consolidated statements of income, shareholders' equity and cash
flows for each of the three years in the period ended December 31, 1993. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
Genuine Parts Company and subsidiaries at December 31, 1993 and 1992, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 1993 in conformity with generally
accepted accounting principles.
As discussed in Note 1 to the financial statements, in 1993 the
Company changed its method of accounting for postretirement benefits and income
taxes.
/s/ Ernst & Young
Atlanta, Georgia
February 7, 1994
19
<PAGE> 3
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------------
(dollars in thousands) December 31
ASSETS 1993 1992
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 123,231 $ 168,019
Short-term investments, at cost, which
approximates market value 64,599 12,010
Trade accounts receivable 428,911 403,152
Merchandise inventories 879,154 787,692
Prepaid expenses and other current accounts 10,299 8,886
- -------------------------------------------------------------------------------------------------------------------------------
TOTAL CURRENT ASSETS 1,506,194 1,379,759
Investments and Other Assets (Notes 1 and 8) 133,364 116,723
Property, Plant and Equipment
Land 28,109 25,353
Buildings, less allowance for depreciation
(1993-$56,839; 1992-$54,164) 103,146 95,485
Machinery and equipment, less allowance for
depreciation (1993-$128,262; 1992-$118,956) 99,943 89,983
- -------------------------------------------------------------------------------------------------------------------------------
NET PROPERTY, PLANT AND EQUIPMENT 231,198 210,821
- -------------------------------------------------------------------------------------------------------------------------------
$ 1,870,756 $1,707,303
===============================================================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
- -------------------------------------------------------------------------------------------------------------------------------
CURRENT LIABILITIES
Trade accounts payable $ 258,949 $ 240,630
Current maturities on long-term debt 797 823
Accrued compensation 30,883 28,312
Accrued expenses 18,222 8,563
Dividends payable 32,933 31,098
Income taxes payable 10,167 10,140
Deferred income taxes 1,521 2,248
- -------------------------------------------------------------------------------------------------------------------------------
TOTAL CURRENT LIABILITIES 353,472 321,814
LONG-TERM DEBT, less current maturities 12,265 13,043
DEFERRED INCOME TAXES 37,980 37,153
MINORITY INTERESTS IN SUBSIDIARIES 21,776 18,921
SHAREHOLDERS' EQUITY (Notes 2, 3, 4 and 6):
Preferred Stock, par value $1 a share-authorized
10,000,000 shares; none issued
Common Stock, par value $1 a share-authorized
150,000,000 shares; issued 124,282,289 shares
in 1993; 124,163,089 shares in 1992 124,282 124,163
Additional paid-in capital 2,566 --
Retained earnings 1,318,415 1,192,209
- -------------------------------------------------------------------------------------------------------------------------------
TOTAL SHAREHOLDERS' EQUITY 1,445,263 1,316,372
- -------------------------------------------------------------------------------------------------------------------------------
$ 1,870,756 $1,707,303
===============================================================================================================================
</TABLE>
See accompanying notes.
20
<PAGE> 4
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended December 31
(dollars in thousands except per share data) 1993 1992 1991
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net sales $4,384,294 $4,016,751 $3,763,736
Cost of goods sold 3,023,038 2,781,731 2,612,059
- --------------------------------------------------------------------------------------------------------------------------------
1,361,256 1,235,020 1,151,677
Selling, administrative and other expenses 935,427 852,610 790,559
- --------------------------------------------------------------------------------------------------------------------------------
Income before income taxes and cumulative effect of changes
in accounting principles 425,829 382,410 361,118
Income taxes (Note 7) 166,961 145,440 137,154
- --------------------------------------------------------------------------------------------------------------------------------
Income before cumulative effect of changes in accounting principles 258,868 236,970 223,964
Cumulative effect of changes in accounting principles, net of tax (Note 1) 1,055 -- --
- --------------------------------------------------------------------------------------------------------------------------------
NET INCOME $ 257,813 $ 236,970 $ 223,964
================================================================================================================================
Net income per common share $ 2.08 $ .91 $ 1.81
================================================================================================================================
Average common shares outstanding during the year 124,217 124,085 123,980
================================================================================================================================
</TABLE>
See accompanying notes.
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
Common Stock Additional Treasury Stock Total
------------------------ Paid-In Retained --------------------- Shareholders'
(dollars in thousands except per share data) Shares Amount Capital Earnings Shares Amount Equity
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at January 1, 1991 80,405,339 $ 80,405 $ 9,449 $1,057,083 4,048,236 $(113,837) $1,033,100
Retirement of GPC treasury stock (4,048,236) (4,048) (9,449) (100,340) (4,048,236) 113,837 -0-
Adjustment for beginning Berry retained earnings -0- -0- -0- 86,075 -0- -0- 86,075
Equivalent shares of pooled companies 6,391,021 6,391 -0- (3,384) -0- -0- 3,007
- ----------------------------------------------------------------------------------------------------------------------------------
Balance at January 1, 1991 as restated 82,748,124 82,748 -0- 1,039,434 -0- -0- 1,122,182
Net income -0- -0- -0- 223,964 -0- -0- 223,964
Cash dividends declared -0- -0- -0- (110,558) -0- -0- (110,558)
Purchase and retirement of stock (120,600) (121) -0- (4,295) -0- -0- (4,416
Stock options exercised 42,680 43 -0- 872 -0- -0- 915
Repurchase of shares by pooled
companies prior to merger -0- -0- -0- (10,273) -0- -0- (10,273)
Cash dividends declared by pooled
companies prior to merger -0- -0- -0- (10,098) -0- -0- (10,098)
- ----------------------------------------------------------------------------------------------------------------------------------
Balance at December 31, 1991 82,670,204 82,670 -0- 1,129,046 -0- -0- 1,211,716
Net income -0- -0- -0- 236,970 -0- -0- 236,970
Cash dividends declared -0- -0- -0- (114,508) -0- -0- (114,508)
Three-for-two stock split 41,350,036 41,350 -0- (41,395) -0- -0- (45)
Stock options exercised 142,849 143 -0- 3,270 -0- -0- 3,413
Repurchase of shares by pooled
companies prior to merger -0- -0- -0- (4,895) -0- -0- (4,895)
Cash dividends declared by pooled
companies prior to merger -0- -0- -0- (16,279) -0- -0- (16,279)
- ----------------------------------------------------------------------------------------------------------------------------------
Balance at December 31, 1992 124,163,089 124,163 -0- 1,192,209 -0- -0- 1,316,372
Net income -0- -0- -0- 257,813 -0- -0- 257,813
Cash dividends declared -0- -0- -0- (131,681) -0- -0- (131,681)
Stock options exercised 119,200 119 2,566 74 -0- -0- 2,759
- ----------------------------------------------------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1993 124,282,289 $124,282 $ 2,566 $1,318,415 -0- $ -0- $1,445,263
==================================================================================================================================
</TABLE>
See accompanying notes.
21
<PAGE> 5
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
Year Ended December 31
(dollars in thousands) 1993 1992 1991
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Operating Activities
Net income $257,813 $236,970 $223,964
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 34,420 31,687 30,595
Gain on sale of property, plant and equipment (1,342) (895) (899)
Provision for deferred taxes 5,990 3,896 4,281
Equity in income from UAP (2,531) (1,738) (1,629)
Equity in income from partnership (1,921) (775) (2,371)
Income applicable to minority interests 2,090 1,537 1,638
Changes in operating assets and liabilities:
Trade accounts receivable (25,759) (33,455) (12,582)
Merchandise inventories (91,462) (60,614) (21,408)
Prepaid expenses and other current accounts (1,413) 488 (1,372)
Trade accounts payable 18,319 22,090 3,919
Income taxes payable and other current liabilities 6,367 (12,987) 15,577
- ---------------------------------------------------------------------------------------------------------------------------------
(57,242) (50,766) 15,749
- ---------------------------------------------------------------------------------------------------------------------------------
NET CASH PROVIDED BY OPERATING ACTIVITIES 200,571 186,204 239,713
Investing Activities
Acquisition of Davis & Wilmar, Inc., net of cash acquired of $3,556 -0- (28,444) -0-
Purchase of property, plant and equipment (57,513) (31,585) (28,273)
Proceeds from sale of property, plant and equipment 4,831 3,862 2,811
Purchase of short-term investments (64,599) (12,010) (10,626)
Proceeds from sale and maturity of short-term investments 12,010 17,698 5,928
Other investing activities (12,962) (9,696) (12,903)
- ---------------------------------------------------------------------------------------------------------------------------------
NET CASH USED IN INVESTING ACTIVITIES (118,233) (60,175) (43,063)
Financing Activities
Borrowings on notes payable -0- -0- 6,372
Repayment of notes payable -0- -0- (32,258)
Payments on long-term debt (804) (5,954) (1,422)
Stock options exercised 2,759 3,368 915
Dividends paid (129,846) (127,338) (119,518)
Purchase of stock -0- (4,896) (14,691)
Contributions from minority interests 765 822 667
- ---------------------------------------------------------------------------------------------------------------------------------
NET CASH USED IN FINANCING ACTIVITIES (127,126) (133,998) (159,935)
- ---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (44,788) (7,969) 36,715
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 168,019 175,988 139,273
- ---------------------------------------------------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS AT END OF YEAR $123,231 $168,019 $175,988
=================================================================================================================================
Supplemental disclosure of cash flow information
Cash paid during the year for:
Income taxes $160,944 $154,498 $122,233
=================================================================================================================================
Interest $ 1,587 $ 1,890 $ 5,454
=================================================================================================================================
</TABLE>
See accompanying notes.
22
<PAGE> 6
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1993
- --------------------------------------------------------------------------------
1. Summary of Significant Accounting Policies
PRINCIPLES OF CONSOLIDATION: The consolidated financial statements include the
accounts of Genuine Parts Company and all of its subsidiaries (the "Company").
Income applicable to minority interests is included in other expenses.
Significant intercompany accounts and transactions have been eliminated in
consolidation.
CASH EQUIVALENTS: The Company considers all highly liquid investments with a
maturity of three months or less when purchased to be cash equivalents.
INVESTMENTS: On August 27, 1992, the Company paid approximately $5.5 million to
increase its ownership in UAP Inc., a Canadian automotive parts distributor,
from 20% to 24%. The Company also has a 49% interest in a partnership formed by
the Company and UAP Inc. These investments are accounted for by the equity
method of accounting.
INVENTORIES: Inventories are valued at the lower of cost or market. Cost is
determined by the last-in, first-out (LIFO) method for substantially all
automotive parts, and certain industrial parts, and by the first-in, first-out
(FIFO) method for all other inventories. If the FIFO method had been used for
all inventories, cost would have been $100,772,000 and $93,123,000 higher than
reported at December 31, 1993 and December 31, 1992, respectively.
PROPERTY, PLANT AND EQUIPMENT: Property, plant and equipment is stated on the
basis of cost. Depreciation is determined principally on a straight-line basis
over the estimated useful life of each asset.
STOCK OPTIONS: Proceeds from the sale of stock under options are credited to
common stock at par value and the excess of the option price over par value is
credited to additional paid-in capital.
INTEREST INCOME: Interest income (1993 - $6,273,000; 1992 - $7,538,000; 1991 -
$9,674,000) has been deducted from selling, administrative and other expenses.
FOREIGN OPERATIONS: Canadian operations represent less than five percent of
consolidated amounts. Translation adjustments are not significant.
INCOME TAXES: Deferred income taxes principally arise from the use of
accelerated depreciation methods for a portion of property, plant and equipment
and the use of different pension valuation and inventory methods for income tax
purposes.
ACCOUNTING CHANGES: Effective January 1, 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 effective January 1, 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.
The adoption of Statements 106 and 109 did not have a material impact
on the Company's financial statements or results of operations.
NET INCOME PER COMMON SHARE: Net income per common share is based on the
weighted average number of shares of common stock outstanding during each year.
Options outstanding under the Company's stock option plan would not materially
dilute net income per share and, therefore, have not been included in the
computation.
RECLASSIFICATIONS: Certain reclassifications have been made to the 1992
financial statements to conform to the current year presentation.
2. ACQUISITIONS
On June 30, 1992, the Company acquired all of the outstanding common stock of
Davis & Wilmar, Inc., an automotive parts distributor, for $32 million. The
acquisition has been recorded using the purchase method of accounting.
On January 29, 1993, the Company completed its merger of Berry Bearing
Company and certain affiliated companies into the Company. The Berry Companies
distribute industrial replacement parts and related supplies throughout the
Midwestern United States. The Company issued 9,586,531 shares of common stock
for all of the outstanding common stock of the Berry Companies. This
transaction has been accounted for as a pooling of interests and, accordingly,
the accompanying financial statements have been retroactively combined to
include the accounts of the pooled companies. A reconciliation of amounts
previously reported by Genuine Parts and the Berry Companies follows, in
thousands:
Berry
Year ended Genuine Parts Companies
December 31, As Reported As Reported Restated
-------------------------------------------------------------
1992
Sales $3,668,814 $347,937 $4,016,751
Net Income 219,788 17,182 236,970
1991
Sales 3,434,642 329,094 3,763,736
Net Income 207,677 16,287 223,964
Operations of the pooled companies in 1993 prior to the merger were
not significant.
23
<PAGE> 7
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
3. STOCK SPLIT
On February 17, 1992, the Board of Directors approved a three-for-two stock
split, effected in the form of a 50% stock dividend, payable to shareholders of
record on March 16, 1992. The par value of the shares issued was charged to
retained earnings.
All references in the financial statements with regard to average
number of shares of common stock and related prices, dividends and per share
amounts have been restated to reflect the three-for-two stock split.
4. SHAREHOLDERS' EQUITY
On November 20, 1989, the Company's Board of Directors approved a Shareholder
Protection Rights Agreement and distributed Rights to common shareholders. The
Rights entitle the holder, upon occurrence of certain events, to purchase
additional stock of the Company. The Rights will be exercisable only if a
person, group or company acquires 20% or more of the Company's common stock or
commences a tender offer that would result in ownership of 30% or more of the
common stock. The Company is entitled to redeem each Right for one cent.
5. LEASED PROPERTIES
The Company leases land, buildings and equipment. Certain land and building
leases have renewal options generally for periods ranging from two to ten
years. Future minimum payments, by year and in the aggregate, under the
noncancellable operating leases with initial or remaining terms of one year or
more consisted of the following at December 31, 1993 (in thousands):
1994 $ 45,171
1995 34,840
1996 23,605
1997 15,406
1998 11,013
Subsequent to 1998 21,816
- ----------------------------------
$151,851
==================================
Rental expense for operating leases was $48,935,000 in 1993;
$47,033,000 in 1992, and $45,758,000 in 1991.
6. STOCK OPTIONS
In accordance with stock option plans approved by the shareholders, options are
granted to key personnel for the purchase of the Company's common stock at
prices not less than the fair market value of the shares on the dates of grant.
Most options may be exercised not earlier than twelve months nor later than ten
years from the date of grant. On April 20, 1992, the shareholders approved the
1992 Stock Option and Incentive Plan which provides for 4,500,000 shares of
common stock to be available for granting of incentive and nonqualified stock
options to key employees. Further information relating to the options is as
follows:
Shares
Option Price ----------------------------------
Per Share 1993 1992 1991
- -----------------------------------------------------------------------------
Outstanding at
January 1 $19.66 to $26.88 1,432,850 798,556 619,164
Granted 26.88 to 37.06 235,700 858,900 324,450
Exercised 19.66 to 26.88 (150,749) (206,481) (133,058)
Cancelled 22.79 to 30.31 (21,500) (18,125) (12,000)
- -----------------------------------------------------------------------------
Outstanding at
December 31 22.58 to 37.06 1,496,301 1,432,850 798,556
=============================================================================
Exercisable at
December 31 22.58 to 31.92 1,014,843 520,316 442,076
=============================================================================
Shares available for
future grants 3,520,856 3,735,056 86,456
=============================================================================
7. INCOME TAXES
Deferred income taxes reflect the net tax effect of temporary differences
between the carrying amounts of the assets and liabilities for financial
reporting purposes and amounts used for income tax purposes. Significant
components of the Company's deferred tax liabilities as of December 31, 1993
are as follows (in thousands):
Property, plant and equipment $15,944
Employee and retiree benefits 15,793
Merchandise inventories 6,243
Other 1,521
- -----------------------------------------
$39,501
=========================================
The components of income tax expense are as follows:
- -----------------------------------------------------------
(in thousands) 1993 1992 1991
- -----------------------------------------------------------
Federal:
Current $132,298 $116,772 $108,825
Deferred 5,990 3,896 4,281
State 28,673 24,772 24,048
- -----------------------------------------------------------
$166,961 $145,440 $137,154
===========================================================
The reasons for the difference between total tax expense and the
amount computed by applying the statutory Federal income tax rate to income
before income taxes were as follows:
- ---------------------------------------------------------------------
(in thousands) 1993 1992 1991
- ---------------------------------------------------------------------
Statutory rate applied to
pre-tax income $149,040 $130,019 $122,780
Plus state income taxes, net of
Federal tax benefit 18,637 16,350 15,872
- ---------------------------------------------------------------------
167,677 146,369 138,652
Other items less than 5%
of the amount computed
using the statutory Federal
income tax rate (716) (929) (1,498)
- ---------------------------------------------------------------------
$166,961 $145,440 $137,154
=====================================================================
24
<PAGE> 8
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
8. EMPLOYEE BENEFIT PLANS
The Company's noncontributory defined benefit pension plan covers substantially
all of its employees. The benefits are based on an average of the employees'
compensation during five of their last ten years of credited service. The
Company's funding policy is to contribute amounts deductible for income tax
purposes. Contributions are intended to provide not only for benefits
attributed for service to date but also for those expected to be earned in the
future.
The following table sets forth the plan's funded status and amounts
recognized in the Company's financial statements at December 31:
- ------------------------------------------------------------------
(in thousands) 1993 1992
- ------------------------------------------------------------------
Actuarial present value of
benefit obligations:
Accumulated benefit obligation,
including vested benefits of
$202,994 in 1993, and
$164,755 in 1992 $(207,707) $(186,183)
==================================================================
Projected benefit obligation for
service rendered to date $(339,271) $(292,172)
Plan assets at fair value,
primarily insurance contracts,
U.S. Government securities
and equity securities 344,217 310,148
- ------------------------------------------------------------------
Plan assets in excess of projected
benefit obligation 4,946 17,976
Unrecognized net loss from past
experience different from that
assumed and effects of changes
in assumptions 36,942 12,501
Unrecognized net transition
obligation 2,083 2,343
- ------------------------------------------------------------------
Net prepaid pension cost $ 43,971 $ 32,820
==================================================================
Net pension cost (income) included the following components at
December 31:
- -----------------------------------------------------------------------------
(in thousands) 1993 1992 1991
- -----------------------------------------------------------------------------
Service cost $ 9,498 $ 10,775 $ 10,050
Interest cost 23,192 23,909 22,111
Actual return on plan assets (35,190) (21,080) (43,031)
Net amortization and deferral 2,353 (5,870) 19,527
- -----------------------------------------------------------------------------
Net periodic pension
cost (income) $ (147) $ 7,734 $ 8,657
=============================================================================
Effective January 1, 1993, the Company began insuring new long-term
disability claims under a policy separate from the pension plan, resulting in a
decrease in net pension cost of approximately $7,000,000 during 1993.
Assumptions used in the accounting for the defined benefit plan as of
December 31 were:
- ------------------------------------------------------------
1993 1992 1991
- ------------------------------------------------------------
Weighted-average discount rate 7.50% 8.75% 8.75%
Rate of increase in future
compensation levels 5.75% 5.75% 5.75%
Expected long-term rate of
return on assets 10.00% 10.00% 10.00%
============================================================
The change in the weighted-average discount rate assumption resulted
in a $56,200,000 increase in the projected benefit obligation at December 31,
1993.
At December 31, 1993, the plan held 534,997 shares of common stock of
the Company with a market value of $20,129,262.
The Company has a defined contribution plan which covers substantially
all of its employees. The Company's contributions are determined based on 20%
of the first 6% of the covered employee's salary. Total plan expense was
approximately $2,712,000 in 1993, $2,212,000 in 1992, and $2,128,000 in 1991,
respectively.
9. INDUSTRY DATA
The industry data for the past five years presented in the Exhibit on page 27
is an integral part of these financial statements.
The Company is primarily engaged in the distribution of merchandise,
principally automotive and industrial replacement parts, and office supplies.
In the automotive industry, the Company distributes replacement parts (other
than body parts) for substantially all makes and models of domestically
manufactured automobiles, most domestically manufactured trucks and buses, and
most vehicles manufactured outside the United States. In addition, this segment
of the business includes the rebuilding of some automotive parts and the
distribution of replacement parts for certain types of farm equipment,
motorcycles, motorboats and small engines.
The Company's industrial segment distributes a wide variety of
industrial bearings, mechanical and fluid power transmission equipment,
including hydraulic and pneumatic products, material handling components, and
related parts and supplies.
The Company's office products segment distributes a wide variety of
office products, computer supplies, office furniture and business electronics.
Intersegment sales are not significant. Operating profit for each
industry segment is calculated as net sales less operating expenses excluding
general corporate expenses, interest expense, equity in income of investments
and minority interests. Identifiable assets by industry are those assets that
are used in the Company's operations in each industry. Corporate assets are
principally cash, cash equivalents, short-term investments and headquarter's
facilities and equipment.
25
<PAGE> 9
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDIITION AND RESULTS OF
OPERATIONS
December 31, 1993
- --------------------------------------------------------------------------------
RESULTS OF OPERATIONS:
Net sales in 1993 increased for the 44th consecutive year to a record high of
$4.4 billion. This was an increase of 9% over the prior year and compares with
increases of 7% in 1992, and 3% in 1991. Sales for the Automotive Parts Group
increased 7% in 1993 versus 6% in 1992, reflecting the slight improvement of
the economy, an improved sales environment in the automotive aftermarket, and
the strength of NAPA programs in the marketplace. Sales for the Industrial
Parts Group increased 7% in 1993 versus 6% in 1992 due to plant and equipment
revitalization resulting from an improved economy and the strength of its sales
and service programs. Sales for the Office Products Group increased 21% in
1993 compared with 11% in 1992 reflecting geographic expansion, improved
service and marketing programs and expansion of product lines.
Costs of goods sold improved slightly as a percentage of net sales in
each of the past two years. Selling, administrative and other expenses
increased each year, and the percentage to net sales has increased slightly
each year, due primarily to increased salaries and wages and employee benefits.
Effective January 1, 1993, the Company began insuring new long-term disability
claims under a policy separate from the pension plan, resulting in a pre-tax
decrease in net pension cost during 1993 of approximately $7 million. The
effective income tax rate was 39.2% in 1993 and 38.0% in 1992 and 1991. The
effective tax rate in 1993 reflects the increase in the federal tax rate from
34% to 35% effective January 1, 1993. Consolidated net income in 1993
increased 9% over 1992 net income. Net income in 1992 increased 6% over 1991.
Effective January 1, 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 effective January 1, 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.
The adoption of Statements 106 and 109 did not have
a material impact on the Company's financial statements or results of
operations.
Additionally, effective December 31, 1993, the Company changed the
weighted-average discount rate assumption for the pension plan from 8.75% to
7.50%. This change resulted in a $56,200,000 increase in the projected benefit
obligation at December 31, 1993.
LIQUIDITY AND SOURCES OF CAPITAL:
The ratio of current assets to current liabilities was 4.3 at the
close of 1993 with current assets amounting to 81% of total assets. Trade
accounts receivable and inventories increased 6% and 12% respectively, while
working capital increased 9%. The increase in working capital has been
financed principally from the Company's cash flow generated by operations.
Current financial resources and anticipated funds from operations are expected
to meet requirements for working capital in 1994. Capital expenditures during
1993 amounted to $58 million compared with $32 million in 1992 and $28 million
in 1991. The increase in 1993 reflects the Company's continuing geographic
expansion as well as the upgrading of their existing facilities. Additionally,
capital expenditures in 1992 and 1991 reflect the Company's response to the
difficult business environment and the overall economy. It is anticipated that
capital expenditures in 1994 will be approximately the same as 1993.
On January 29, 1993, 9,586,531 shares of common stock were issued for
all of the outstanding common stock of Berry Bearing Company and certain
affiliated companies. This transaction has been accounted for as a pooling of
interests; and accordingly, the financial statements have been retroactively
combined to include the accounts of the pooled companies.
On June 30, 1992, the Company paid approximately $32 million for all
the issued and outstanding capital stock of Davis & Wilmar, Inc. Davis &
Wilmar serves approximately 150 NAPA Auto Parts stores from NAPA Distribution
Centers in Altoona, Pennsylvania and Bridgeport, West Virginia.
On August 27, 1992, the Company paid approximately $5.5 million for an
additional 4% equity interest in UAP Inc., a Canadian automotive parts
distributor. The Company now has a 24% equity interest in UAP, which is being
accounted for on the equity method of accounting.
INFLATION:
Price increases in the Automotive Parts Group were approximately 1% in 1993 as
sales increased 7%. The Industrial Parts Group had a sales increase of 7% and
price increases of approximately 3%. The Office Products Group had a sales
increase of 21% and price increases of less than 1%.
Price increases in the Automotive Group were approximately 2% in 1992
as sales increased 6%. The Industrial Parts Group had a sales increase of 6%
and price increases of approximately 2%. The Office Products Group had a sales
increase of 11% and price increases of less than 1%.
The charges to operations for depreciation represent the allocation of
historical costs incurred over past years and are significantly less than if
they were based on the current cost of productive capacity being consumed.
Assets acquired in prior years will, of course, be replaced at higher costs,
but this will take place over many years.
26
<PAGE> 10
Genuine Parts Company and Subsidiaries
- --------------------------------------------------------------------------------
INDUSTRY DATA
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
(dollars in thousands) 1993 1992 1991 1990 1989
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net sales
Automotive $2,485,267 $2,318,761 $2,188,698 $2,117,464 $2,010,755
Industrial 1,153,371 1,082,428 1,021,019 1,019,227 958,668
Office products 745,656 615,562 554,019 523,752 515,866
- -----------------------------------------------------------------------------------------------------------------------------------
Total net sales $4,384,294 $4,016,751 $3,763,736 $3,660,443 $3,485,289
- -----------------------------------------------------------------------------------------------------------------------------------
Operating profit
Automotive $ 282,791 $ 262,422 $ 260,818 $ 252,862 $ 247,920
Industrial 96,727 87,493 76,922 80,578 74,116
Office products 65,938 50,967 45,112 45,606 44,863
- -----------------------------------------------------------------------------------------------------------------------------------
Total operating profit 445,456 400,882 382,852 379,046 366,899
Interest expense (1,584) (1,871) (5,434) (5,411) (5,796)
Corporate expense (20,405) (17,577) (18,662) (14,448) (16,369)
Equity in income 4,452 2,513 4,000 3,814 4,299
Minority interests (2,090) (1,537) (1,638) (1,560) (1,560)
- -----------------------------------------------------------------------------------------------------------------------------------
Income before income taxes $ 425,829 $ 382,410 $ 361,118 $ 361,441 $ 347,473
- -----------------------------------------------------------------------------------------------------------------------------------
Identifiable assets
Automotive $1,152,148 $1,040,191 $ 926,617 $ 875,324 $ 795,185
Industrial 370,633 354,547 338,054 337,418 328,635
Office products 283,479 228,802 201,036 186,815 181,759
Corporate 6,731 27,333 57,197 43,881 79,095
Equity investments 57,765 56,430 54,612 44,974 42,034
- -----------------------------------------------------------------------------------------------------------------------------------
Total assets $1,870,756 $1,707,303 $1,577,516 $1,488,412 $1,426,708
- -----------------------------------------------------------------------------------------------------------------------------------
Depreciation and amortization
Automotive $ 24,056 $ 21,905 $ 20,301 $ 19,436 $ 15,986
Industrial 5,410 5,286 5,732 5,450 4,918
Office products 4,246 3,752 3,794 3,727 3,314
Corporate 708 744 768 964 1,198
- -----------------------------------------------------------------------------------------------------------------------------------
Total depreciation and amortization $ 34,420 $ 31,687 $ 30,595 $ 29,577 $ 25,416
- -----------------------------------------------------------------------------------------------------------------------------------
Capital expenditures
Automotive $ 39,502 $ 24,272 $ 22,381 $ 33,190 $ 32,438
Industrial 2,779 2,553 2,479 8,586 9,271
Office products 12,378 3,395 3,055 3,488 12,351
Corporate 2,854 1,365 358 845 464
- -----------------------------------------------------------------------------------------------------------------------------------
Total capital expenditures $ 57,513 $ 31,585 $ 28,273 $ 46,109 $ 54,524
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Present tax laws do not allow deductions for adjustments for the
impact of inflation. Thus, taxes are levied on the Company at rates which, in
real terms, exceed established statutory rates. In general, during periods of
inflation, this tax policy results in a tax on shareholders' investment in the
Company.
QUARTERLY RESULTS OF OPERATIONS:
Miscellaneous year-end adjustments resulted in increasing net income during the
fourth quarter of 1993 and 1992 by approximately $16,206,000 ($.13 per share)
and $13,155,000 ($.11 per share), respectively.
The following is a summary of the quarterly results of operations for
the years ended December 31, 1993 and 1992. The quarterly results have been
adjusted to reflect the Company's acquisition of the Berry Companies in a
transaction accounted for as a pooling of interests.
Three Months Ended
- --------------------------------------------------------------------
March 31, June 30, Sept. 30, Dec. 31,
- --------------------------------------------------------------------
1993 (in thousands except per share data)
Net Sales $1,037,914 $1,106,176 $1,144,839 $1,095,365
Gross Profit 310,421 326,282 347,399 377,154
Net Income 55,336 65,905 63,019 73,553
Net Income per
Common Share .45 .53 .51 .59
1992
Net Sales $ 959,071 $1,013,596 $1,049,422 $ 994,662
Gross Profit 286,666 298,626 314,309 335,419
Net Income 51,452 60,098 59,706 65,714
Net Income per
Common Share .41 .48 .48 .53
27
<PAGE> 1
EXHIBIT 22
SUBSIDIARIES OF THE COMPANY
Jurisdiction of
Name % Owned Incorporation
- ---- ------- -------------
Balkamp, Inc. 89.61 Indiana
Berry Bearing Company 100.0 Illinois
Bearing Service Company 100.0 Kentucky
Bearings Manufacturing Company 100.0 Illinois
Bearings Service Company 100.0 Illinois
Bearings Service Company, Inc. 100.0 Indiana
BBC - Berry Bearing Company 100.0 Illinois
Berry Bearing Company, Inc. 100.0 Indiana
Illinois Bearing Company 100.0 Illinois
Wisconsin Bearing Company 100.0 Illinois
Davis & Wilmar, Inc. 100.0 Pennsylvania
Genuine Parts Holdings, Ltd. 100.0 Province of
Alberta, Canada
Motion Industries, Inc. 100.0 Delaware
Parts Incorporated, Inc. 100.0 Alaska
S. P. Richards Company 100.0 Georgia
Alamogordo Parts & Supply, Inc. 51.0 Georgia
AmLynch, Inc. 100.0 Georgia
Best Auto Parts, Inc. 51.0 Georgia
Blocker Automotive Supply, Inc. 51.0 Georgia
Boerner Enterprises, Inc. 51.0 Georgia
Brigham Automotive Supply, Inc. 51.0 Georgia
Bulldog Auto Parts, Inc. 51.0 Georgia
<PAGE> 2
Bullock Automotive, Inc. 51.0 Georgia
Clermont-Brown Automotive Supply, Inc. 51.0 Georgia
C & O Auto Parts, Inc. 51.0 Georgia
First Choice Automotive, Inc. 51.0 Georgia
Franklin County Sypply, Inc. 51.0 Georgia
Gila Automotive Supply, Inc. 51.0 Georgia
Greco Auto & Truck Parts, Inc. 51.0 Georgia
Hansens Automotive Supply, Inc. 51.0 Georgia
Jones Parts Company, Inc. 51.0 Georgia
L & P Automotive Supply, Inc. 51.0 Georgia
Lana Lou Auto Parts, Inc. 51.0 Georgia
Landry Supply, Inc. 51.0 Georgia
Luke's Auto Supply, Inc. 51.0 Georgia
Middletown Parts Unlimited, Inc. 51.0 Georgia
Nelson Enterprises, Inc. 51.0 Georgia
North Shore Automotive, Inc. 51.0 Georgia
Oberlin Auto Parts, Inc. 51.0 Georgia
Parts & Company of Selma, Inc. 51.0 Georgia
Parts of Ringgold, Inc. 51.0 Georgia
Petoskey Automotive Center, Incorporated 51.0 Georgia
Plymouth-Rock Auto Parts, Inc. 51.0 Georgia
P.M.A. Associates, Inc. 51.0 Georgia
Port Charlotte Auto Supply, Inc. 51.0 Georgia
Price Automotive Supply, Inc. 51.0 Georgia
Pride City Auto Parts, Inc. 51.0 Georgia
Rasmussen Auto Supply, Inc. 51.0 Georgia
Rome Auto Parts, Inc. 51.0 Georgia
<PAGE> 3
Rutherford Automotive, Inc. 51.0 Georgia
Sanchez Truck & Auto Parts, Inc. 51.0 Georgia
Sevier County Auto Parts, Inc. 51.0 Georgia
Slidell Parts Warehouse, Inc. 51.0 Georgia
TNT Supply, Inc. 51.0 Georgia
Uptergrove Auto Supply, Inc. 51.0 Georgia
Warren County Automotive, Inc. 51.0 Georgia
Wisota Auto Parts, Inc. 51.0 Georgia
<PAGE> 1
EXHIBIT 24 - CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Annual Report (Form 10-K)
of Genuine Parts Company of our report dated February 7, 1994, included in the
1993 Annual Report to Shareholders of Genuine Parts Company.
Our audits also included the financial statement schedule of Genuine Parts
Company listed in Item 14(a). This schedule is the responsibility of the
Company's management. Our responsibility is to express an opinion based on our
audits. In our opinion, the financial statement schedule referred to above,
when considered in relation to the basic financial statements taken as a whole,
presents fairly in all material respects the information set forth therein.
We also consent to the incorporation by reference in the Registration Statement
(Form S-8 Number 33-30982) pertaining to the Genuine Parts Company 1988 Stock
Option Plan and in the Registration Statement (Form S-8 Number 33-62512)
pertaining to the Genuine Parts Company 1992 Stock Option and Incentive Plan of
our report dated February 7, 1994, with respect to the financial statements
incorporated herein by reference, and our report included in the preceding
paragraph with respect to the financial statement schedule included in this
Annual Report (Form 10-K) of Genuine Parts Company.
ERNST & YOUNG
Atlanta, Georgia
March 22, 1994
<PAGE> 2
SCHEDULE IX - SHORT-TERM BORROWINGS
GENUINE PARTS COMPANY AND SUBSIDIARIES
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
COL. A COL. B COL. C COL. D COL. E COL. F
- -----------------------------------------------------------------------------------------------------------------------------------
WEIGHTED MAXIMUM AMOUNT AVERAGE AMOUNT WEIGHTED AVERAGE
CATEGORY OF AGGREGATE SHORT- BALANCE AT END AVERAGE OUTSTANDING DURING OUTSTANDING (2) INTEREST RATE (3)
TERM BORROWINGS OF PERIOD INTEREST RATE THE PERIOD DURING THE PERIOD DURING THE PERIOD
- -----------------------------------------------------------------------------------------------------------------------------------
(Amounts in Thousands)
<S> <C> <C> <C> <C> <C>
Year ended December 31, 1993:
Notes payable to bank (1) $ -- -- $ -- $ -- --
Year ended December 31, 1992:
Notes payable to bank (1) -- -- -- -- --
Year ended December 31, 1991:
Notes payable to bank (1) -- -- 42,834 32,305 10.6
</TABLE>
(1) Notes payable to bank represent a fixed rate, note payable and other
additional borrowings under a line-of-credit arrangement.
(2) The average amount outstanding during the period was computed by
dividing the total of month-end outstanding principal balances by 12.
(3) The weighted average interest rate during the period was computed by
dividing the actual interest expense by average short-term debt
outstanding.
