x
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
|
o
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
|
For
The Transition Period From ____________ To
______________
|
DELAWARE
|
95-4486486
|
(State
or other jurisdiction of
incorporation
or organization)
|
(I.R.S.
Employer
Identification
No.)
|
1400
Opus Place, Suite 600, Downers Grove, IL
|
60515
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Title
of Each Class
|
Name
of Each Exchange on Which Listed
|
Common
Stock, $.01 par value
|
Nasdaq
Global Select Market
|
Page
|
||
•
|
remove
the assembly, disassemble it into its component pieces, replace worn
or
broken parts with remanufactured or new components, and reinstall
the
assembly in the vehicle;
|
•
|
replace
the assembly with an assembly from a remanufacturer such as us;
or
|
•
|
replace
the assembly with a new assembly manufactured by the
OEM.
|
•
|
First,
costs to the customers associated with remanufactured assemblies
generally
are substantially less than costs associated with either new assemblies
or
assemblies that have been rebuilt by the dealer following a severe
failure. This is due primarily to our lower labor costs and our use
of high volume salvage and manufacturing techniques that enable us
to
refurbish and reuse a high percentage of original components. The
cost savings produced by remanufactured assemblies help our customers
manage their warranty expenses.
|
•
|
Second,
remanufactured assemblies are generally of consistent high quality
due to
the precision manufacturing techniques, technical upgrades and rigorous
inspection and testing procedures we employ in remanufacturing. By
contrast, the quality of rebuilt assemblies generally is less consistent
because it is heavily dependent on the skill level of the particular
mechanic as well as the availability of adequate tooling and testing
equipment. For warranty repairs, consistent quality is
important to the customer providing the applicable warranty, because
once
installed, the remanufactured product is usually covered by the customer’s
warranty for the balance of the original warranty
period.
|
•
|
Third,
replacement of a component with a remanufactured component generally
takes
considerably less time than the time needed to rebuild the component,
thereby significantly reducing the time the vehicle is at the dealer
or
repair shop and allowing the dealer or repair shop to increase its
volume
of business.
|
•
|
Fourth,
the environmental benefits of remanufacturing may be significant. We
annually re-process thousands of tons of materials that would otherwise
have been discarded. Remanufacturing in our facilities, when compared
to
rebuilding at various dealers, generally results in a more efficient
reuse
of parts and a more controlled recycling of scrap materials and excess
fluids. This in turn leads to associated cost savings and benefits
to customers that are increasingly focused on environmental compliance
issues.
|
•
|
consumers
retaining automobiles for shorter periods, which could occur in periods
of
economic growth or stability;
|
•
|
transmission
designs that result in greater reliability;
|
•
|
consumers
driving fewer miles per year due to high gasoline prices; and
|
•
|
mild
weather.
|
•
|
guidelines
that affect dealer decisions to rebuild units at the dealer rather
than
install remanufactured transmissions;
|
•
|
a
decision not to use remanufactured units for warranty
replacements;
|
•
|
shortened
warranty periods that could reduce the demand for our products;
|
•
|
reductions
in the amount of inventory our OEM customers elect to retain;
|
•
|
longer
time periods before remanufactured transmissions are introduced for
use
with a particular automobile; and
|
•
|
pricing
strategies.
|
•
|
quarterly
variations in our results of operations, which may be impacted by,
among
other things, price renegotiations with, or loss of, our customers;
|
•
|
quarterly
variations in the results of operations or stock prices of comparable
companies;
|
•
|
announcements
of new products or services offered by us or our competitors;
|
•
|
changes
in earnings estimates or buy/sell recommendations by financial analysts;
|
•
|
the
stock price performance of our customers; and
|
•
|
general
market conditions or market conditions specific to particular industries.
|
•
|
pricing
strategies;
|
•
|
changes
to our customers’ warranty policies;
|
•
|
changes
in product costs from vendors;
|
•
|
the
risk of some of the items in our inventory becoming obsolete;
|
•
|
the
availability and quality of cores;
|
•
|
the
relative mix of products and services sold during the period; and
|
•
|
general
market and competitive conditions.
|
•
|
dilutive
issuances of equity securities;
|
•
|
reductions
in our operating results;
|
•
|
incurrence
of debt and contingent liabilities;
|
•
|
future
impairment of goodwill and other intangibles; and
|
•
|
other
acquisition-related expenses.
|
•
|
retain
key management members and technical personnel of acquired companies;
|
•
|
successfully
merge corporate cultures and operational and financial systems; and
|
•
|
realize
sale and cost reduction synergies.
|
•
|
a
portion of our cash flow from operations must be dedicated to interest
payments on our indebtedness and is not available for other purposes,
which amount would increase if prevailing interest rates rise;
|
•
|
it
may materially limit or impair our ability to obtain financing in
the
future;
|
•
|
it
may reduce our flexibility to respond to changing business and economic
conditions or take advantage of business opportunities that may arise;
and
|
•
|
our
ability to pay dividends is limited.
|
Location
|
Approx.
Sq.
Feet
|
Lease
Expiration
Date
|
Products
Produced/Services Provided
|
|||
Springfield,
MO
|
280,800
|
2008
|
transmissions,
transfer cases and assorted components (1)
|
|||
Oklahoma
City, OK
|
100,000
|
2019
|
transmissions,
transfer cases and assorted components, NuVinci
products (1)
|
|||
Oklahoma
City, OK
|
200,000
|
owned
(2)
|
transmissions
and assorted components (1)
|
|||
Oklahoma
City, OK
|
94,000
|
2008
|
returned
material reclamation and disposition, core management
(3)
|
|||
Carrollton
(Dallas), TX
|
39,000
|
2008
|
radios,
telematics and instrument and display clusters (3)
|
|||
Ft.
Worth, TX
|
221,000
|
2008
|
cellular
phone and accessory distribution and related
services (3)
|
|||
Ft.
Worth, TX
|
375,000
|
2010
|
cellular
phone test and repair, returns processing, accessory packaging
(3)
|
|||
Ft.
Worth, TX
|
180,000
|
2009
|
wireless
device and accessory distribution and related
services (3)
|
|||
Grantham,
England
|
120,000
|
owned
|
engines
and related components (1)
|
(1)
|
This
facility is used by the Drivetrain segment.
|
(2)
|
This
property is subject to a mortgage securing our bank credit
facility.
|
(3)
|
This
facility is used by the Logistics
segment.
|
High
|
Low
|
||||
2006
|
|||||
First
quarter
|
$
|
22.68
|
$
|
19.19
|
|
Second
quarter
|
26.83
|
21.77
|
|||
Third
quarter
|
25.64
|
16.81
|
|||
Fourth
quarter
|
22.31
|
17.49
|
|||
2005
|
|||||
First
quarter
|
$
|
16.70
|
$
|
13.53
|
|
Second
quarter
|
17.68
|
13.80
|
|||
Third
quarter
|
18.84
|
15.96
|
|||
Fourth
quarter
|
21.71
|
16.15
|
Period
|
Total
number
of
Shares Purchased
|
Price
Paid per Share
|
Total
Number of Shares Purchased
as
Part of a
Publicly
Announced
Plan
|
Maximum
Number
of Shares that May Yet Be Purchased Under
the
Plan
|
|||||
October
1-31, 2006
|
−
|
$
|
−
|
−
|
−
|
||||
November
1-30, 2006
|
1,473
|
$
|
17.61
|
1,473(1)
|
−
|
||||
December
1-31, 2006
|
−
|
$
|
−
|
−
|
−
|
(1)
|
Repurchases
were made pursuant to our stock incentive
plans.
|
12/31/01
|
12/31/02
|
12/31/03
|
12/31/04
|
12/30/05
|
12/29/06
|
|
Aftermarket
Technology Corp.
|
100.00
|
89.51
|
84.69
|
99.38
|
120.00
|
131.36
|
Peer
Group Index
|
100.00
|
85.18
|
98.45
|
133.68
|
141.54
|
156.27
|
NASDAQ
Market Index
|
100.00
|
69.75
|
104.88
|
113.70
|
116.19
|
128.12
|
Year
Ended December 31,
|
|||||||||||||||
2006
|
2005
|
2004
|
2003
|
2002
|
|||||||||||
(In
thousands, except per share data)
|
|||||||||||||||
Statements
of Income Data:
|
|||||||||||||||
Net
sales
|
$
|
497,974
|
$
|
419,618
|
$
|
375,600
|
$
|
322,657
|
$
|
378,764
|
|||||
Cost
of sales
|
393,269
|
315,507
|
275,453
|
227,239
|
242,781
|
||||||||||
Exit,
disposal, certain severance and other charges (1)
|
−
|
−
|
−
|
200
|
−
|
||||||||||
Gross
profit
|
104,705
|
104,111
|
100,147
|
95,218
|
135,983
|
||||||||||
Selling,
general and administrative expense
|
54,538
|
48,993
|
45,034
|
45,332
|
52,612
|
||||||||||
Amortization
of intangible assets
|
269
|
125
|
125
|
299
|
333
|
||||||||||
Impairment
of goodwill
|
14,592
|
−
|
−
|
−
|
−
|
||||||||||
Exit,
disposal, certain severance and other charges (credits)
(1)
|
1,938
|
523
|
3,766
|
8,273
|
(277
|
)
|
|||||||||
Operating
income
|
33,368
|
54,470
|
51,222
|
41,314
|
83,315
|
||||||||||
Interest
income
|
605
|
2,026
|
2,658
|
2,863
|
2,769
|
||||||||||
Interest
expense
|
(4,297
|
)
|
(7,696
|
)
|
(7,271
|
)
|
(8,169
|
)
|
(12,280
|
)
|
|||||
Other
income, net
|
262
|
542
|
19
|
70
|
43
|
|
|||||||||
Equity
in income (losses) of investee
|
−
|
−
|
146
|
277 | (575 | ) | |||||||||
Redemption
of senior notes
|
−
|
−
|
−
|
−
|
(3,022
|
)
|
|||||||||
Write-off
of debt issuance costs
|
(1,691
|
)
|
−
|
−
|
−
|
(1,480
|
)
|
||||||||
Income
tax expense
|
(10,506
|
)
|
(16,344
|
)
|
(16,698
|
)
|
(13,477
|
)
|
(23,650
|
)
|
|||||
Income
from continuing operations (2)
|
$
|
17,741
|
$
|
32,998
|
$
|
30,076
|
$
|
22,878
|
$
|
45,120
|
|||||
Income
from continuing operations per diluted share (3)
|
$
|
0.81
|
$
|
1.53
|
$
|
1.40
|
$
|
0.93
|
$
|
1.87
|
|||||
Shares
used in computation of income from continuing operations per diluted
share
(3)
|
21,927
|
21,579
|
21,411
|
24,486
|
24,119
|
||||||||||
Other
Data:
|
|||||||||||||||
Capital
expenditures
|
$
|
11,910
|
$
|
17,292
|
$
|
10,820
|
$
|
12,927
|
$
|
12,476
|
As
of December 31,
|
||||||||||||||
2006
|
2005
|
2004
|
2003
|
2002
|
||||||||||
(In
thousands)
|
||||||||||||||
Balance
Sheet Data:
|
||||||||||||||
Cash
and cash equivalents
|
$
|
7,835
|
$
|
45,472
|
$
|
18,085
|
$
|
59,628
|
$
|
65,504
|
||||
Working
capital, continuing operations
|
89,262
|
109,226
|
88,221
|
103,855
|
122,627
|
|||||||||
Property,
plant and equipment, net
|
53,008
|
54,153
|
51,416
|
53,435
|
51,648
|
|||||||||
Total
assets
|
345,677
|
407,780
|
390,277
|
451,862
|
454,030
|
|||||||||
Current
and long-term debt outstanding
|
17,800
|
90,779
|
112,406
|
127,342
|
164,613
|
|||||||||
Long-term
liabilities, less current portion
|
46,194
|
107,077
|
122,225
|
134,545
|
159,561
|
|||||||||
Total
stockholders' equity
|
232,330
|
221,230
|
186,373
|
229,251
|
206,435
|
(1) |
See
Item 8. “Consolidated Financial Statements and Supplementary Data - Note
18” for a description of exit, disposal, certain severance and other
charges.
|
(2) |
Income
from continuing operations for the years ended December 31, 2006,
2005, 2004, 2003 and 2002 excludes gain (loss) from discontinued
operations, net of
income taxes, of $(9,718), $(1,990), $(24,300), $(2,367) and $1,307, respectively. |
(3) |
See
Item 8. “Consolidated Financial Statements and Supplementary Data - Note
13” for a description of the computation of earnings per
share.
|
•
|
value-added
warehouse and distribution services;
|
•
|
turnkey
order fulfillment and information
services;
|
•
|
test
and repair services;
|
•
|
automotive
electronic components remanufacturing and distribution services;
and
|
•
|
returned
material reclamation, disposition and core management services,
|
Year
Ended December 31,
|
||||||||||||||||||||||
2006
|
2005
|
2004
|
||||||||||||||||||||
Net
sales
|
$
|
498.0
|
100.0
|
%
|
$
|
419.6
|
100.0
|
%
|
$
|
375.6
|
100.0
|
%
|
||||||||||
Gross
profit
|
104.7
|
21.0
|
104.1
|
24.8
|
100.1
|
26.7
|
||||||||||||||||
SG&A
expense
|
54.5
|
10.9
|
49.0
|
11.7
|
45.0
|
12.0
|
||||||||||||||||
Impairment
of goodwill
|
14.6
|
2.9
|
−
|
−
|
−
|
−
|
||||||||||||||||
Exit,
disposal, certain severance and other charges
|
1.9
|
0.3
|
0.5
|
0.1
|
3.8
|
1.0
|
||||||||||||||||
Operating
income
|
33.4
|
6.7
|
54.5
|
13.0
|
51.2
|
13.6
|
||||||||||||||||
Interest
income
|
0.6
|
0.1
|
2.0
|
0.5
|
2.7
|
0.7
|
||||||||||||||||
Other
income, net
|
0.3
|
−
|
0.5
|
0.1
|
−
|
−
|
||||||||||||||||
Write-off
of debt issuance costs
|
(1.7
|
)
|
(0.3
|
)
|
−
|
−
|
−
|
−
|
||||||||||||||
Interest
expense
|
(4.3
|
)
|
(0.9
|
)
|
(7.7
|
)
|
(1.8
|
)
|
(7.3
|
)
|
(1.9
|
)
|
||||||||||
Income
from continuing operations
|
17.7
|
3.6
|
33.0
|
7.9
|
30.1
|
8.0
|
•
|
scheduled
price reductions to certain customers in our Drivetrain and Logistics
segments pursuant to recent contract
renewals;
|
•
|
a
lower volume of Ford remanufactured transmissions we believe to be
largely
the result of (i) comparatively higher sales in 2005 due to inventory
increases in Ford’s distribution channel during the third and fourth
quarters of 2005 (we believe these higher inventory positions returned
to
historical levels during the first half of 2006), and (ii) declining
new
vehicle sales resulting in a reduction in the population of Ford
vehicles
in the zero to eight-year age category, which category we believe
drives
the majority of demand for our Ford
products;
|
•
|
a
reduction in volume of DaimlerChrysler remanufactured transmissions
due to
(i) DaimlerChrysler’s decision not to use remanufactured transmissions for
warranty repairs generally for model years 2003 and later,
resulting in one less model year being in our warranty program each
year
and (ii) comparatively
higher sales in 2005 due to inventory increases in DaimlerChrysler’s
distribution channel;
|
•
|
an
increase in product development and startup cost in our Drivetrain
segment
associated with the NuVinci™
CVP technology;
|
•
|
an
increase in cost in our Logistics segment associated with the vertical
integration of certain test and repair services that were previously
outsourced; and
|
•
|
an
increase in cost in our Logistics segment associated with the launch
of a
new test and repair program in a new
market,
|
•
|
an
increase in volumes in our Logistics segment, primarily related to
the
launch and roll-out of new business added during 2005 with AT&T, and
to a lesser extent, Nokia, LG, Magellan, T-Mobile and others, coupled
with
an increase in our base business with AT&T; and
|
•
|
an
increase in volume of medium/heavy duty remanufactured transmissions
in
our Drivetrain segment related to the roll-out of the program we
launched
for Allison in the fourth quarter of 2005 (under the terms of our
remanufacturing program with Allison, we are required to purchase
the
transmission core; accordingly, our results for 2006 and 2005 reflect
$23.6 million and $3.2 million, respectively, for core included in
both
net sales and cost of goods sold);
|
•
|
a
lower volume of Ford remanufactured transmissions we believe to be
largely
the result of (i) comparatively higher sales in 2005 due to inventory
increases in Ford’s distribution channel during the third and fourth
quarters of 2005 (we believe these higher inventory positions returned
to
historical levels during the first half of 2006), and (ii) declining
new
vehicle sales resulting in a reduction in the population of Ford
vehicles
in the zero to eight-year age category, which category we believe
drives
the majority of demand for our Ford
products;
|
•
|
a
reduction in volume of DaimlerChrysler remanufactured transmissions
due to
(i) DaimlerChrysler’s decision not to use remanufactured transmissions for
warranty repairs generally for model years 2003 and later,
resulting in one less model year being in our warranty program each
year
and (ii) comparatively
higher sales in 2005 due to inventory increases in DaimlerChrysler’s
distribution channel;
|
•
|
a
one-time sale in 2005 of $12.5 million of transmission components
at cost
relating to end-of-life support for an OEM transmission program that
ceased production in late 2000; and
|
•
|
scheduled
price reductions to certain customers in our Drivetrain and Logistics
segments pursuant to recent contract
renewals.
|
Year
Ended December 31,
|
|||||||||||
2006
|
2005
|
||||||||||
Net
sales
|
$
|
234.6
|
100.0
|
%
|
$
|
266.4
|
100.0
|
%
|
|||
Segment
profit
|
$
|
9.0
|
3.8
|
%
|
$
|
36.4
|
13.7
|
%
|
•
|
a
lower volume of Ford remanufactured transmissions we believe to be
largely
the result of (i) comparatively higher sales in 2005 due to inventory
increases in Ford’s distribution channel during the third and fourth
quarters of 2005 (we believe these higher inventory positions returned
to
historical levels during the first half of 2006), and (ii) declining
new
vehicle sales resulting in a reduction in the population of vehicles
in
the zero to eight-year age category, which category we believe drives
the
majority of demand for our Ford
products;
|
•
|
a
reduction in volume of DaimlerChrysler remanufactured transmissions
due to
(i) DaimlerChrysler’s decision not to use remanufactured transmissions for
warranty repairs generally for model years 2003 and later,
resulting in one less model year being in our warranty program each
year
and (ii) comparatively
higher sales in 2005 due to inventory increases in DaimlerChrysler’s
distribution channel;
|
•
|
a
one-time sale in 2005 of $12.5 million of transmission components
at cost
relating to end-of-life support for an OEM transmission program
that
ceased production in late 2000;
|
•
|
a
reduction in volume of remanufactured engines for certain older
European
engine programs;
|
•
|
a
reduction in volume of Honda remanufactured transmissions used
in warranty
applications; and
|
•
|
scheduled
price reductions to certain customers pursuant to recent contract
renewals,
|
|
Year
Ended December 31,
|
||||||||||||
2006
|
2005
|
||||||||||||
Net
sales
|
$
|
263.4
|
100.0
|
%
|
$
|
153.2
|
100.0
|
%
|
|||||
Segment
profit
|
$
|
24.4
|
9.3
|
%
|
$
|
18.1
|
11.8
|
%
|
•
|
benefits
from our on-going lean and continuous improvement program and other
cost
reduction initiatives;
|
•
|
new
business wins in our Logistics segment, including our test and repair
program with AT&T and, to a lesser extent, Nokia, LG and
T-Mobile;
|
•
|
an
increase in our base logistics business with AT&T;
and
|
•
|
an
increase in volume of Honda remanufactured transmissions as we realized
the full-year benefit of that program, which did not fully ramp up
until
the second quarter of 2004,
|
•
|
scheduled
price reductions to certain customers in our Drivetrain and Logistics
segments pursuant to contracts entered into primarily in
2003;
|
•
|
a
reduction in volume of remanufactured engines for certain older European
engine programs;
|
•
|
an
increase in costs related to new business and product development
in our
Drivetrain Remanufacturing segment;
and
|
•
|
a
reduction in volume of Ford remanufactured transmissions that is
believed
to result from repair cost-cap adjustments on certain transmission
models.
|
•
|
new
business wins in our Logistics segment, including our test and repair
program and other programs with AT&T and, to a lesser extent, Nokia,
LG and T-Mobile;
|
•
|
increases
in our base logistics volume with
AT&T;
|
•
|
a
one-time sale in 2005 of $12.5 million of transmission components
at cost
relating to end-of-life support for an OEM transmission program that
ceased production in late 2000 and
from which we do not expect any future sales;
and
|
•
|
an
increase in volume of Honda remanufactured transmissions as we realized
the full-year benefit of that program, which did not fully ramp up
until
the second quarter of 2004,
|
• |
scheduled
price reductions to certain customers in our Drivetrain and Logistics
segments pursuant to contracts entered into primarily in
2003;
|
•
|
a
reduction in volume of remanufactured engines for certain older European
engine programs;
|
•
|
a
reduction in volume of Ford remanufactured transmissions that is
believed
to result from repair cost-cap adjustments on certain transmission
models;
and
|
•
|
a
reduction in sales for certain remanufacturing-related services and
certain other low volume remanufacturing
programs.
|
|
Year
Ended December 31,
|
||||||||||||
2005
|
2004
|
||||||||||||
Net
sales
|
$
|
266.4
|
100.0
|
%
|
$
|
271.2
|
100.0
|
%
|
|||||
Segment
profit
|
$
|
36.4
|
13.7
|
%
|
$
|
40.0
|
14.7
|
%
|
•
|
a
reduction in volume of remanufactured engines for certain older European
engine programs;
|
•
|
scheduled
price reductions to certain customers pursuant to contracts entered
into
primarily in 2003;
|
•
|
a
reduction in volume of Ford remanufactured transmissions that is
believed
to result from repair cost-cap adjustments on certain transmission
models;
and
|
•
|
a
reduction in sales for certain remanufacturing-related services and
certain other low volume remanufacturing
programs,
|
|
Year
Ended December 31,
|
||||||||||||
2005
|
2004
|
||||||||||||
Net
sales
|
$
|
153.2
|
100.0
|
%
|
$
|
104.4
|
100.0
|
%
|
|||||
Segment
profit
|
$
|
18.1
|
11.8
|
%
|
$
|
15.5
|
14.8
|
%
|
Applicable
Rate
|
||||||
Consolidated
Leverage Ratio
|
LIBOR
Margin and
Letters
of Credit
|
Commitment
Fee
|
Prime
Rate
Margin
|
|||
Less
than 1.00:1
|
1.00%
|
0.20%
|
0.00%
|
|||
Greater
or equal to 1.00:1 but less than 1.75:1
|
1.25%
|
0.25%
|
0.25%
|
|||
Greater
or equal to 1.75:1 but less than 2.50:1
|
1.50%
|
0.30%
|
0.50%
|
|||
Greater
or equal to 2.50:1
|
1.75%
|
0.35%
|
0.75%
|
Total
|
Less
than
1
year
|
1
- 3 years
|
3
- 5 years
|
More
than
5
years
|
|||||||||||
Debt
Obligations:
|
|||||||||||||||
Principal
balance on credit facility
|
$
|
17.8
|
$
|
−
|
$
|
−
|
$
|
17.8
|
$
|
−
|
|||||
Letters
of credit
|
1.6
|
−
|
−
|
1.6
|
−
|
||||||||||
Interest
on credit facility (1)
|
5.9
|
1.4
|
2.8
|
1.7
|
−
|
||||||||||
Total
debt obligations
|
25.3
|
1.4
|
2.8
|
21.1
|
−
|
||||||||||
Operating
lease obligations
|
23.6
|
7.8
|
9.3
|
2.3
|
4.2
|
||||||||||
Purchase
obligations
|
11.0
|
10.9
|
0.1
|
−
|
−
|
||||||||||
Executive
compensation agreements (2)
|
1.0
|
0.7
|
0.3
|
−
|
−
|
||||||||||
Nonqualified
deferred compensation
(3)
|
2.0
|
−
|
0.2
|
−
|
1.8
|
||||||||||
Deferred
compensation (4)
|
0.6
|
0.1
|
0.3
|
0.2
|
−
|
||||||||||
Total
|
$
|
63.5
|
$
|
20.9
|
$
|
13.0
|
$
|
23.6
|
$
|
6.0
|
(1)
|
Amount
represents estimated interest expense obligations on borrowings
outstanding under our credit facility at December 31, 2006. Interest
is
determined assuming the revolving balance outstanding was paid off
on
March 31, 2011, the expiration date of the credit facility. Interest
on
floating rate debt is estimated using interest rates in effect at
December
31, 2006.
|
(2)
|
Represents
amounts payable to our former CEO, former CFO and other former executives.
|
(3)
|
Represents
amounts payable to certain of our employees and directors under a
nonqualified deferred compensation plan.
|
(4)
|
Relates
to the 1997 acquisition of ATS, which requires us to make certain
payments
to key employees of the seller on various dates subsequent to the
closing
date. Through December 31, 2006, we had made $3.0 million of these
payments (including $0.1 million paid in 2006).
|
CONSOLIDATED
BALANCE SHEETS
|
|||||||
(In
thousands, except share and per share data)
|
|||||||
December
31,
|
December
31,
|
||||||
2006
|
2005
|
||||||
Assets
|
|||||||
Current
Assets:
|
|||||||
Cash
and cash equivalents
|
$
|
7,835
|
$
|
45,472
|
|||
Accounts
receivable, net
|
77,720
|
71,881
|
|||||
Inventories
|
56,904
|
50,058
|
|||||
Prepaid
and other assets
|
3,788
|
4,396
|
|||||
Refundable
income taxes
|
1,382
|
689
|
|||||
Deferred
income taxes
|
7,771
|
11,446
|
|||||
Assets
of discontinued operations
|
766
|
18,562
|
|||||
Total
current assets
|
156,166
|
202,504
|
|||||
Property,
plant and equipment, net
|
53,008
|
54,153
|
|||||
Debt
issuance costs, net
|
664
|
1,981
|
|||||
Goodwill
|
132,375
|
146,176
|
|||||
Intangible
assets, net
|
1,327
|
292
|
|||||
Long-term
investments
|
1,966
|
347
|
|||||
Other
assets
|
171
|
80
|
|||||
Assets
of discontinued operations
|
-
|
2,247
|
|||||
Total
assets
|
$
|
345,677
|
$
|
407,780
|
|||
Liabilities
and Stockholders' Equity
|
|||||||
Current
Liabilities:
|
|||||||
Accounts
payable
|
$
|
46,906
|
$
|
41,294
|
|||
Accrued
expenses
|
19,102
|
23,130
|
|||||
Credit
facility
|
-
|
10,062
|
|||||
Amounts
due to sellers of acquired companies
|
-
|
94
|
|||||
Deferred
compensation
|
130
|
136
|
|||||
Liabilities
of discontinued operations
|
1,015
|
4,757
|
|||||
Total
current liabilities
|
67,153
|
79,473
|
|||||
Amount
drawn on credit facility, less current portion
|
17,800
|
80,623
|
|||||
Deferred
compensation, less current portion
|
2,352
|
847
|
|||||
Other
long-term liabilities
|
2,335
|
2,200
|
|||||
Deferred
income taxes
|
23,707
|
23,407
|
|||||
Stockholders'
Equity:
|
|||||||
Preferred
stock, $.01 par value; shares authorized - 2,000,000; none
issued
|
-
|
-
|
|||||
Common
stock, $.01 par value; shares authorized - 30,000,000;
|
|||||||
Issued
(including shares held in treasury) - 27,109,709 and 26,539,926
|
|||||||
as
of December 31, 2006 and 2005, respectively
|
271
|
265
|
|||||
Additional
paid-in capital
|
223,288
|
212,678
|
|||||
Retained
earnings
|
85,913
|
77,890
|
|||||
Accumulated
other comprehensive income
|
3,537
|
1,186
|
|||||
Unearned
compensation
|
-
|
(1,160
|
)
|
||||
Common
stock held in treasury, at cost - 5,303,083 and 4,774,374
shares
|
|||||||
as
of December 31, 2006 and 2005, respectively
|
(80,679
|
)
|
(69,629
|
)
|
|||
Total
stockholders' equity
|
232,330
|
221,230
|
|||||
Total
liabilities and stockholders' equity
|
$
|
345,677
|
$
|
407,780
|
|||
See
accompanying notes.
|
CONSOLIDATED
STATEMENTS OF INCOME
|
||||||||||
(In
thousands, except per share data)
|
||||||||||
For
the years ended December 31,
|
||||||||||
2006
|
2005
|
2004
|
||||||||
Net
sales:
|
||||||||||
Products
|
$
|
234,569
|
$
|
266,398
|
$
|
271,215
|
||||
Services
|
263,405
|
153,220
|
104,385
|
|||||||
Total
net sales
|
497,974
|
419,618
|
375,600
|
|||||||
Cost
of sales:
|
||||||||||
Products
|
183,214
|
200,488
|
202,633
|
|||||||
Services
|
210,055
|
115,019
|
72,820
|
|||||||
Total
cost of sales
|
393,269
|
315,507
|
275,453
|
|||||||
Gross
profit
|
104,705
|
104,111
|
100,147
|
|||||||
Selling,
general and administrative expense
|
54,538
|
48,993
|
45,034
|
|||||||
Amortization
of intangible assets
|
269
|
125
|
125
|
|||||||
Impairment
of goodwill
|
14,592
|
-
|
-
|
|||||||
Exit,
disposal, certain severance and other charges
|
1,938
|
523
|
3,766
|
|||||||
Operating
income
|
33,368
|
54,470
|
51,222
|
|||||||
Interest
income
|
605
|
2,026
|
2,658
|
|||||||
Other
income, net
|
262
|
542
|
19
|
|||||||
Equity
in income of investee
|
-
|
-
|
146
|
|||||||
Write-off
of debt issuance costs
|
(1,691
|
)
|
-
|
-
|
||||||
Interest
expense
|
(4,297
|
)
|
(7,696
|
)
|
(7,271
|
)
|
||||
Income
from continuing operations before income taxes
|
28,247
|
49,342
|
46,774
|
|||||||
Income
tax expense
|
10,506
|
16,344
|
16,698
|
|||||||
Income
from continuing operations
|
17,741
|
32,998
|
30,076
|
|||||||
Loss
from discontinued operations,
|
||||||||||
net
of income taxes
|
(9,718
|
)
|
(1,990
|
)
|
(24,300
|
)
|
||||
Net
income
|
$
|
8,023
|
$
|
31,008
|
$
|
5,776
|
||||
Per
common share - basic:
|
||||||||||
Income
from continuing operations
|
$
|
0.82
|
$
|
1.55
|
$
|
1.43
|
||||
Loss
from discontinued operations
|
$
|
(0.45
|
)
|
$
|
(0.09
|
)
|
$
|
(1.15
|
)
|
|
Net
income
|
$
|
0.37
|
$
|
1.45
|
$
|
0.27
|
||||
Per
common share - diluted:
|
||||||||||
Income
from continuing operations
|
$
|
0.81
|
$
|
1.53
|
$
|
1.40
|
||||
Loss
from discontinued operations
|
$
|
(0.44
|
)
|
$
|
(0.09
|
)
|
$
|
(1.13
|
)
|
|
Net
income
|
$
|
0.37
|
$
|
1.44
|
$
|
0.27
|
||||
See
accompanying notes.
|
CONSOLIDATED
STATEMENTS OF STOCKHOLDERS' EQUITY
|
|||||||||||||||||||||||||
(In
thousands, except share data)
|
|||||||||||||||||||||||||
Preferred
Stock
|
Common
Stock
|
Additional
Paid-In
Capital
|
Retained
Earnings
|
Accumulated
Other Comprehensive
Income
|
Unearned
Compensation
|
Common
Stock in
Treasury
|
Total
|
||||||||||||||||||
Balance
at January 1, 2004
|
$
|
-
|
$
|
252
|
$
|
194,204
|
$
|
41,106
|
$
|
1,891
|
$
|
(231
|
)
|
$
|
(7,971
|
)
|
$
|
229,251
|
|||||||
Net
income
|
-
|
-
|
-
|
5,776
|
-
|
-
|
-
|
5,776
|
|||||||||||||||||
Translation
adjustments
|
-
|
-
|
-
|
-
|
1,651
|
-
|
-
|
1,651
|
|||||||||||||||||
Comprehensive
income
|
7,427
|
||||||||||||||||||||||||
Issuance
of 141,500 shares of common stock from incentive stock
awards
|
-
|
1
|
2,039
|
-
|
-
|
(2,040
|
)
|
-
|
-
|
||||||||||||||||
Issuance
of 708,063 shares of common stock from exercise of stock
options
|
-
|
7
|
5,753
|
-
|
-
|
-
|
-
|
5,760
|
|||||||||||||||||
Tax
benefit from stock-based award transactions
|
-
|
-
|
428
|
-
|
-
|
-
|
-
|
428
|
|||||||||||||||||
Stock-based
compensation expense from modification of stock options
|
-
|
-
|
3,323
|
-
|
-
|
-
|
-
|
3,323
|
|||||||||||||||||
Amortization
of unearned compensation
|
-
|
-
|
-
|
-
|
-
|
1,522
|
-
|
1,522
|
|||||||||||||||||
Repurchase
of 3,820,967 shares of common stock for treasury
|
-
|
-
|
-
|
-
|
-
|
-
|
(61,338
|
)
|
(61,338
|
)
|
|||||||||||||||
Balance
at December 31, 2004
|
-
|
260
|
205,747
|
46,882
|
3,542
|
(749
|
)
|
(69,309
|
)
|
186,373
|
|||||||||||||||
Net
income
|
-
|
-
|
-
|
31,008
|
-
|
-
|
-
|
31,008
|
|||||||||||||||||
Translation
adjustments
|
-
|
-
|
-
|
-
|
(2,356
|
)
|
-
|
-
|
(2,356
|
)
|
|||||||||||||||
Comprehensive
income
|
28,652
|
||||||||||||||||||||||||
Issuance
of 93,125 shares of common stock from incentive stock
awards
|
-
|
1
|
1,475
|
-
|
-
|
(1,476
|
)
|
-
|
-
|
||||||||||||||||
Issuance
of 423,382 shares of common stock from exercise of stock
options
|
-
|
4
|
4,266
|
-
|
-
|
-
|
-
|
4,270
|
|||||||||||||||||
Tax
benefit from stock-based award transactions
|
-
|
-
|
1,190
|
-
|
-
|
-
|
-
|
1,190
|
|||||||||||||||||
Amortization
of unearned compensation
|
-
|
-
|
-
|
-
|
-
|
1,065
|
-
|
1,065
|
|||||||||||||||||
Repurchase
of 19,670 shares of common stock
for
treasury
|
-
|
-
|
-
|
-
|
-
|
-
|
(320
|
)
|
(320
|
)
|
|||||||||||||||
Balance
at December 31, 2005
|
-
|
265
|
212,678
|
77,890
|
1,186
|
(1,160
|
)
|
(69,629
|
)
|
221,230
|
|||||||||||||||
Net
income
|
-
|
-
|
-
|
8,023
|
-
|
-
|
-
|
8,023
|
|||||||||||||||||
Translation
adjustments
|
-
|
-
|
-
|
-
|
2,337
|
-
|
-
|
2,337
|
|||||||||||||||||
Unrealized
gain on available-for-sale securities,
net
of income taxes
|
-
|
-
|
-
|
-
|
14
|
-
|
-
|
14
|
|||||||||||||||||
Comprehensive
income
|
10,374
|
||||||||||||||||||||||||
Issuance
of 97,429 shares of common stock from incentive stock
awards
|
-
|
1
|
(1
|
)
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||
Issuance
of 472,354 shares of common stock from exercise of stock
options
|
-
|
5
|
7,490
|
-
|
-
|
-
|
-
|
7,495
|
|||||||||||||||||
Tax
benefit from stock-based award transactions
|
-
|
-
|
1,525
|
-
|
-
|
-
|
-
|
1,525
|
|||||||||||||||||
Noncash
stock-based compensation
|
-
|
-
|
2,756
|
-
|
-
|
-
|
-
|
2,756
|
|||||||||||||||||
Repurchase
of 516,950 shares of common stock for treasury
|
-
|
-
|
-
|
-
|
-
|
-
|
(11,050
|
)
|
(11,050
|
)
|
|||||||||||||||
Reclassification
of unearned compensation upon adoption of SFAS 123R
|
-
|
-
|
(1,160
|
)
|
-
|
-
|
1,160
|
-
|
-
|
||||||||||||||||
Balance
at December 31, 2006
|
$
|
-
|
$
|
271
|
$
|
223,288
|
$
|
85,913
|
$
|
3,537
|
$
|
-
|
$
|
(80,679
|
)
|
$
|
232,330
|
||||||||
See
accompanying notes.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
||||||||||
(In
thousands)
|
||||||||||
For
the years ended December 31,
|
||||||||||
2006
|
2005
|
2004
|
||||||||
Operating
Activities:
|
||||||||||
Net
income
|
$
|
8,023
|
$
|
31,008
|
$
|
5,776
|
||||
Adjustments
to reconcile net income to net cash provided by
|
||||||||||
operating
activities - continuing operations:
|
||||||||||
Net
loss from discontinued operations
|
9,718
|
1,990
|
24,300
|
|||||||
Impairment
of goodwill
|
14,592
|
-
|
-
|
|||||||
Write-off
of debt issuance costs
|
1,691
|
-
|
-
|
|||||||
Depreciation
and amortization
|
13,871
|
13,062
|
11,681
|
|||||||
Noncash
stock-based compensation
|
2,756
|
1,065
|
4,845
|
|||||||
Amortization
of debt issuance costs
|
412
|
1,254
|
1,323
|
|||||||
Adjustments
to provision for losses on accounts receivable
|
(23
|
)
|
334
|
204
|
||||||
Loss
on sale of equipment
|
160
|
55
|
20
|
|||||||
Deferred
income taxes
|
3,916
|
9,311
|
3,891
|
|||||||
Changes
in operating assets and liabilities,
|
||||||||||
net
of businesses acquired or discontinued/sold:
|
||||||||||
Accounts
receivable
|
(5,262
|
)
|
(24,919
|
)
|
(9,123
|
)
|
||||
Inventories
|
(5,013
|
)
|
12,635
|
(2,697
|
)
|
|||||
Prepaid
and other assets
|
(244
|
)
|
2,715
|
(500
|
)
|
|||||
Accounts
payable and accrued expenses
|
2,920
|
5,489
|
(5,693
|
)
|
||||||
Net
cash provided by operating activities - continuing
operations
|
47,517
|
53,999
|
34,027
|
|||||||
Net
cash provided by operating activities - discontinued
operations
|
4,425
|
257
|
3,208
|
|||||||
Investing
Activities:
|
||||||||||
Purchases
of property, plant and equipment
|
(11,910
|
)
|
(17,292
|
)
|
(10,820
|
)
|
||||
Purchases
of available-for-sale securities
|
(3,981
|
)
|
(561
|
)
|
-
|
|||||
Purchase
of assets of a business
|
(1,746
|
)
|
-
|
-
|
||||||
Purchase
of intangible assets
|
(950
|
)
|
-
|
-
|
||||||
Proceeds
from sales of available-for-sale securities
|
2,511
|
218
|
-
|
|||||||
Proceeds
from redemption of note receivable from sale of business
|
-
|
8,365
|
-
|
|||||||
Proceeds
from sale of property, plant and equipment
|
57
|
42
|
3,882
|
|||||||
Net
cash used in investing activities - continuing operations
|
(16,019
|
)
|
(9,228
|
)
|
(6,938
|
)
|
||||
Net
cash provided by (used in) investing activities - discontinued
operations
|
2,161
|
155
|
(1,694
|
)
|
||||||
Financing
Activities:
|
||||||||||
Payments
on term debt
|
(90,685
|
)
|
(19,188
|
)
|
(10,018
|
)
|
||||
Borrowings
on revolving credit facility, net
|
17,800
|
-
|
-
|
|||||||
Debt
issuance costs
|
(786
|
)
|
118
|
-
|
||||||
Payments
on capital lease obligation
|
-
|
-
|
(351
|
)
|
||||||
Proceeds
from exercise of stock options
|
7,495
|
4,270
|
5,760
|
|||||||
Tax
benefit from stock-based award transactions
|
1,329
|
-
|
-
|
|||||||
Repurchases
of common stock for treasury
|
(11,050
|
)
|
(320
|
)
|
(61,338
|
)
|
||||
Payments
on amounts due to sellers of acquired companies
|
(29
|
)
|
(2,450
|
)
|
(4,067
|
)
|
||||
Payments
of deferred compensation related to acquired company
|
(136
|
)
|
(142
|
)
|
(148
|
)
|
||||
Net
cash used in financing activities
|
(76,062
|
)
|
(17,712
|
)
|
(70,162
|
)
|
||||
Effect
of exchange rate changes on cash and cash equivalents
|
341
|
(84
|
)
|
16
|
||||||
Increase
(decrease) in cash and cash equivalents
|
(37,637
|
)
|
27,387
|
(41,543
|
)
|
|||||
Cash
and cash equivalents at beginning of year
|
45,472
|
18,085
|
59,628
|
|||||||
Cash
and cash equivalents at end of year
|
$
|
7,835
|
$
|
45,472
|
$
|
18,085
|
||||
|
||||||||||
Cash
paid during the year for:
|
||||||||||
Interest
|
$
|
4,682
|
$
|
6,733
|
$
|
5,300
|
||||
Income
taxes, net
|
809
|
4,821
|
1,828
|
|||||||
See
accompanying notes.
|
For
the years ended December 31,
|
|||||||||
2006
|
2005
|
2004
|
|||||||
Expected
volatility
|
38.11
|
%
|
39.39
|
%
|
65.71
|
%
|
|||
Risk-free
interest rates
|
5.01
|
%
|
3.69
|
%
|
3.05
|
%
|
|||
Expected
term
|
3.7
years
|
2.5
years
|
3.7
years
|
For
the years ended December 31,
|
||||||||
2005
|
2004
|
|||||||
Income
from continuing operations as reported
|
$
|
32,998
|
$
|
30,076
|
||||
Stock-based
employee compensation costs included in the determination of income
from
continuing operations as
reported,
net of income taxes
|
670
|
2,981
|
||||||
Stock-based
employee compensation costs that would have been included in the
determination of income from
continuing
operations if the fair value based method had been applied to all
awards,
net of income taxes
|
(3,392
|
)
|
(4,459
|
)
|
||||
Pro
forma income from continuing operations as if the fair value based
method
had been applied to all awards
|
$
|
30,276
|
$
|
28,598
|
||||
Basic
earnings per common share:
|
||||||||
Income
from continuing operations as reported
|
$
|
1.55
|
$
|
1.43
|
||||
Pro
forma as if the fair value based method had been applied to all
awards
|
$
|
1.42
|
$
|
1.36
|
||||
Diluted
earnings per common share:
|
||||||||
Income
from continuing operations as reported
|
$
|
1.53
|
$
|
1.40
|
||||
Pro
forma as if the fair value based method had been applied to all awards
|
$
|
1.40
|
$
|
1.34
|
December 31,
|
||||||
2006
|
2005
|
|||||
Raw
materials, including core inventories
|
$
|
49,984
|
$
|
42,743
|
||
Work-in-process
|
1,717
|
1,538
|
||||
Finished
goods
|
5,203
|
5,777
|
||||
$
|
56,904
|
$
|
50,058
|
December 31,
|
|||||||
2006
|
2005
|
||||||
Land
|
$
|
2,520
|
$
|
2,433
|
|||
Buildings
|
12,888
|
12,684
|
|||||
Machinery
and equipment
|
100,438
|
89,672
|
|||||
Autos
and trucks
|
2,063
|
2,103
|
|||||
Furniture
and fixtures
|
2,664
|
2,549
|
|||||
Leasehold
improvements
|
15,076
|
14,192
|
|||||
Construction
in process
|
844
|
1,064
|
|||||
136,493
|
124,697
|
||||||
Less:
Accumulated depreciation and amortization
|
(83,485
|
)
|
(70,544
|
)
|
|||
$
|
53,008
|
$
|
54,153
|
|
Drivetrain
|
Logistics
|
Other
|
Consolidated
|
||||||||||
Balance
at December 31, 2004
|
$
|
128,096
|
$
|
18,973
|
$
|
135
|
$
|
147,204
|
||||||
Effect
of exchange rate changes from the translation of U.K.
subsidiary
|
(1,028
|
)
|
−
|
−
|
(1,028
|
)
|
||||||||
Balance
at December 31, 2005
|
127,068
|
18,973
|
135
|
|
146,176
|
|||||||||
Impairment
|
(11,722
|
)
|
(2,870
|
)
|
−
|
(14,592
|
)
|
|||||||
Effect
of exchange rate changes from the translation of U.K.
subsidiary
|
791
|
−
|
−
|
791
|
||||||||||
Balance
at December 31, 2006
|
$
|
116,137
|
$
|
16,103
|
$
|
135
|
$
|
132,375
|
December
31,
|
|||||||
2006
|
2005
|
||||||
Intangible
assets
|
$
|
2,575
|
$
|
1,261
|
|||
Less:
Accumulated amortization
|
(1,248
|
)
|
(969
|
)
|
|||
$
|
1,327
|
$
|
292
|
Estimated
Amortization Expense
|
||
2007
|
$
|
432
|
2008
|
328
|
|
2009
|
245
|
|
2010
|
191
|
|
2011
|
112
|
December 31,
|
|||||
2006
|
2005
|
||||
Payroll,
employee benefits and related costs
|
$
|
11,648
|
$
|
13,913
|
|
Customer
related allowances, discounts and other credits
|
714
|
863
|
|||
Warranty
|
1,985
|
2,499
|
|||
Exit,
disposal, certain severance and other charges
|
423
|
343
|
|||
Interest
payable
|
37
|
840
|
|||
Other
|
4,295
|
4,672
|
|||
$
|
19,102
|
$
|
23,130
|
Balance
at December 31, 2003
|
$
|
3,195
|
|
Warranties
issued
|
3,449
|
||
Claims
paid / settlements
|
(3,742
|
)
|
|
Changes
in liability for pre-existing warranties
|
(136
|
)
|
|
Balance
at December 31, 2004
|
2,766
|
||
Warranties
issued
|
1,334
|
||
Claims
paid / settlements
|
(1,471
|
)
|
|
Changes
in liability for pre-existing warranties
|
(130
|
)
|
|
Balance
at December 31, 2005
|
2,499
|
||
Warranties
issued
|
1,292
|
||
Claims
paid / settlements
|
(1,297
|
)
|
|
Changes
in liability for pre-existing warranties
|
(509
|
)
|
|
Balance
at December 31, 2006
|
$
|
1,985
|
December
31,
|
||||||
2006
|
2005
|
|||||
A-Loan
|
$
|
−
|
$
|
10,273
|
||
B-Loans
|
−
|
80,412
|
||||
Revolver
|
17,800
|
−
|
||||
17,800
|
90,685
|
|||||
Less
current portion of credit facility
|
−
|
(10,062
|
)
|
|||
Total
long-term portion of credit facility
|
$
|
17,800
|
$
|
80,623
|
For
the years ended December
31,
|
|||||||||||
2006
|
2005
|
2004
|
|||||||||
Current:
|
|||||||||||
Federal
|
$
|
8,012
|
$
|
7,178
|
$
|
5,541
|
|||||
State
|
679
|
435
|
(57
|
)
|
|||||||
Foreign
|
241
|
206
|
519
|
||||||||
Total
current
|
8,932
|
7,819
|
6,003
|
||||||||
Deferred:
|
|||||||||||
Federal
|
4,870
|
8,537
|
9,005
|
||||||||
State
|
(409
|
)
|
142
|
1,529
|
|||||||
Foreign
|
(2,887
|
)
|
(154
|
)
|
161
|
||||||
Total
deferred
|
1,574
|
8,525
|
10,695
|
||||||||
$
|
10,506
|
$
|
16,344
|
$
|
16,698
|
For
the years ended December
31,
|
||||||||||
2006
|
2005
|
2004
|
||||||||
Domestic
|
$
|
37,399
|
$
|
49,338
|
$
|
44,655
|
||||
Foreign
|
(9,152
|
)
|
4
|
2,119
|
||||||
Total
|
$
|
28,247
|
$
|
49,342
|
$
|
46,774
|
For
the years ended December 31,
|
|||||||||||||||||||||||
2006
|
2005
|
2004
|
|||||||||||||||||||||
|
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
|||||||||||||||||
Tax
at U.S. statutory rates
|
$
|
9,886
|
35.0
|
%
|
$
|
17,270
|
35.0
|
%
|
$
|
16,371
|
35.0
|
%
|
|||||||||||
State
income taxes, net of federal tax benefit
|
442
|
1.6
|
578
|
1.2
|
1,079
|
2.3
|
|||||||||||||||||
Foreign
income taxes
|
458
|
1.6
|
−
|
−
|
(106
|
)
|
(0.2
|
)
|
|||||||||||||||
Increase
(decrease) in valuation allowance
|
54
|
0.1
|
-
|
−
|
(8
|
)
|
−
|
||||||||||||||||
Nondeductible
expenses
|
108
|
0.4
|
91
|
0.2
|
96
|
0.2
|
|||||||||||||||||
Federal
and state credits
|
(183
|
)
|
(0.6
|
)
|
(1,558
|
)
|
(3.2
|
)
|
−
|
−
|
|||||||||||||
Federal
and state impact of IRS audit resolution
|
−
|
−
|
−
|
−
|
(441
|
)
|
(1.0
|
)
|
|||||||||||||||
Other
|
(259
|
)
|
(0.9
|
)
|
(37
|
)
|
(0.1
|
)
|
(293
|
)
|
(0.6
|
)
|
|||||||||||
$
|
10,506
|
37.2
|
%
|
$
|
16,344
|
33.1
|
%
|
$
|
16,698
|
35.7
|
%
|
December
31,
|
|||||||
2006
|
2005
|
||||||
Deferred
tax assets:
|
|||||||
Inventory
obsolescence reserve
|
$
|
1,677
|
$
|
2,358
|
|||
Product
warranty accruals
|
660
|
1,114
|
|||||
Exit,
disposal, certain severance and other charges accruals
|
299
|
187
|
|||||
Other
nondeductible accruals
|
3,541
|
2,155
|
|||||
Credit
carryforwards
|
3,547
|
2,431
|
|||||
Net
operating loss carryforwards
|
13,754
|
18,871
|
|||||
Goodwill
impairment
|
4,868
|
−
|
|||||
Total
deferred tax assets
|
28,346
|
27,116
|
|||||
Deferred
tax liabilities:
|
|||||||
Amortization
of intangible assets
|
28,703
|
23,926
|
|||||
Property,
plant and equipment
|
3,000
|
3,103
|
|||||
Other
deferred items
|
336
|
289
|
|||||
Total
deferred tax liabilities
|
32,039
|
27,318
|
|||||
Valuation
allowance
|
(12,243
|
)
|
(11,759
|
)
|
|||
Net
deferred tax (liability) asset
|
$
|
(15,936
|
)
|
$
|
(11,961
|
)
|
|
Shares
|
Weighted-
Average
Exercise
Price
|
Weighted-
Average
Remaining
Contractual Term (in years)
|
|
Aggregate
Intrinsic
Value
|
|||||
Outstanding
at January 1, 2006
|
1,798,139
|
$
|
18.43
|
|||||||
Granted
at market price
|
200,998
|
$
|
24.63
|
|||||||
Exercised
|
(472,354
|
)
|
$
|
15.86
|
||||||
Forfeited
|
(19,502
|
)
|
$
|
15.93
|
||||||
Expired
|
(833
|
)
|
$
|
19.70
|
||||||
Outstanding
at December 31, 2006
|
1,506,448
|
$
|
20.10
|
6.8
|
$
|
5,735
|
||||
Vested
and expected to vest at December 31, 2006
|
1,484,685
|
$
|
20.04
|
6.7
|
$
|
5,723
|
||||
Exercisable
at December 31, 2006
|
1,131,780
|
$
|
20.19
|
6.2
|
$
|
4,522
|
Options
Outstanding
|
Options
Exercisable
|
||||||||||||||
Range
of
Exercise
Prices
|
Shares
|
Weighted-
Average
Remaining
Contractual
Life
|
Weighted-
Average
Exercise
Prices
|
Shares
|
Weighted-
Average
Exercise
Prices
|
||||||||||
$4.56
- $7.00
|
40,999
|
4.3
years
|
$
|
5.01
|
40,999
|
$
|
5.01
|
||||||||
$7.01
- $12.00
|
95,832
|
5.3
years
|
$
|
10.05
|
86,499
|
$
|
10.10
|
||||||||
$12.01
- $15.00
|
385,161
|
7.1
years
|
$
|
14.48
|
221,824
|
$
|
14.42
|
||||||||
$15.01
- $20.00
|
290,458
|
7.7
years
|
$
|
16.56
|
286,458
|
$
|
16.51
|
||||||||
$20.01
- $30.00
|
693,998
|
6.5
years
|
$
|
26.97
|
496,000
|
$
|
27.91
|
||||||||
1,506,448
|
6.7
years
|
$
|
20.10
|
1,131,780
|
$
|
20.19
|
|
Number
of
Shares
|
Weighted
Average Grant-Date Fair Value
|
|||
Unvested
balance at January 1, 2006
|
144,121
|
$
|
15.38
|
||
Granted
|
97,429
|
$
|
24.51
|
||
Vested
|
(57,792
|
)
|
$
|
15.16
|
|
Forfeited
|
(11,759
|
)
|
$
|
16.42
|
|
Unvested
balance at December 31, 2006
|
171,999
|
$
|
20.56
|
For
the years ended December
31,
|
||||||||
2006
|
2005
|
2004
|
||||||
Numerator:
|
||||||||
Income
from continuing operations
|
$
|
17,741
|
$
|
32,998
|
$
|
30,076
|
||
Denominator:
|
||||||||
Weighted-average
common shares outstanding
|
21,714,161
|
21,351,829
|
21,096,921
|
|||||
Common
stock equivalents
|
213,131
|
227,251
|
314,341
|
|||||
Denominator
for diluted earnings per common share
|
21,927,292
|
21,579,080
|
21,411,262
|
|||||
Per
common share -
basic
|
$
|
0.82
|
$
|
1.55
|
$
|
1.43
|
||
Per
common share -
diluted
|
$
|
0.81
|
$
|
1.53
|
$
|
1.40
|
December
31,
|
|||||||
2006
|
2005
|
||||||
Cost
basis of investments
|
$
|
1,945
|
$
|
350
|
|||
Gross
unrealized holding gains
|
30
|
1
|
|||||
Gross
unrealized holding losses
|
(9
|
)
|
(4
|
)
|
|||
Aggregate
fair value
|
$
|
1,966
|
$
|
347
|
For
the years ended December 31,
|
||||||||||||
2006
|
2005
|
2004
|
||||||||||
Exit
from Independent Aftermarket:
|
||||||||||||
Loss
from closure and sale of businesses
|
$
|
(13,261
|
)
|
$
|
−
|
$
|
−
|
|||||
Operating
loss
|
(1,576
|
)
|
(1,795
|
)
|
(5,029
|
)
|
||||||
Non-operating
income
|
143
|
43
|
5
|
|||||||||
Loss
before income taxes
|
(14,694
|
)
|
(1,752
|
)
|
(5,024
|
)
|
||||||
Income
tax benefit
|
4,960
|
633
|
1,743
|
|||||||||
Loss
from Independent Aftermarket, net of income taxes
|
(9,734
|
)
|
(1,119
|
)
|
(3,281
|
)
|
||||||
Disposal
of Gastonia Operations:
|
||||||||||||
Sales
|
$
|
−
|
$
|
−
|
$
|
19,992
|
||||||
Impairment
of goodwill
|
−
|
−
|
(22,114
|
)
|
||||||||
Exit,
disposal, certain severance and other charges
|
−
|
(1,012
|
)
|
(6,906
|
)
|
|||||||
Other
costs and expenses
|
(68
|
)
|
(131
|
)
|
(21,788
|
)
|
||||||
Loss
before income taxes
|
(68
|
)
|
(1,143
|
)
|
(30,816
|
)
|
||||||
Income
tax benefit
|
24
|
416
|
10,591
|
|||||||||
Loss
from Gastonia operation, net of income taxes
|
(44
|
)
|
(727
|
)
|
(20,225
|
)
|
||||||
Sale
of Distribution Group:
|
||||||||||||
Income
before income taxes
|
90
|
−
|
93
|
|||||||||
Income
tax expense
|
(30
|
)
|
−
|
(37
|
)
|
|||||||
Adjustment
to valuation allowance on capital losses
|
−
|
(144
|
)
|
(2,218
|
)
|
|||||||
Adjustment
to income tax benefit
|
−
|
−
|
1,368
|
|||||||||
Gain
(loss) from Distribution Group, net of income taxes
|
60
|
(144
|
)
|
(794
|
)
|
|||||||
Loss
from discontinued operations, net of income taxes
|
$
|
(9,718
|
)
|
$
|
(1,990
|
)
|
$
|
(24,300
|
)
|
December 31,
|
|||||
2006
|
2005
|
||||
Assets:
|
|||||
Exit
from Independent Aftermarket:
|
|||||
Accounts
receivable
|
$
|
158
|
$
|
3,414
|
|
Promissory
note receivable
|
459
|
−
|
|||
Inventory
|
149
|
15,093
|
|||
Other
current assets
|
−
|
55
|
|||
Total
current assets of discontinued operations
|
766
|
18,562
|
|||
Property,
plant and equipment
|
−
|
862
|
|||
Goodwill
|
−
|
1,385
|
|||
Total
long term assets of discontinued operations
|
−
|
2,247
|
|||
Total
assets of discontinued operations
|
$
|
766
|
$
|
20,809
|
|
Liabilities:
|
|||||
Exit
from Independent Aftermarket:
|
|||||
Accounts
payable
|
$
|
−
|
$
|
1,557
|
|
Accrued
expenses
|
847
|
2,969
|
|||
Disposal
of Gastonia Operations:
|
|||||
Current
liabilities
|
148
|
105
|
|||
Sale
of Distribution Group:
|
|||||
Obligations
from the sale of the distribution group
|
20
|
126
|
|||
Total
liabilities of discontinued operations
|
$
|
1,015
|
$
|
4,757
|
For
the years ended December 31,
|
Operating
Leases
|
|
2007
|
$
|
7,830
|
2008
|
5,745
|
|
2009
|
3,496
|
|
2010
|
1,566
|
|
2011
|
770
|
|
2012
and thereafter
|
4,177
|
|
Total
minimum lease payments
|
$
|
23,584
|
Drivetrain
|
Logistics
|
Corporate
|
Discontinued
Assets
|
Consolidated
|
||||||||||||
2006:
|
||||||||||||||||
Net
sales from external customers
|
$
|
234,569
|
$
|
263,405
|
$
|
−
|
$
|
−
|
$
|
497,974
|
||||||
Depreciation
and amortization expense
|
8,416
|
5,455
|
−
|
−
|
13,871
|
|||||||||||
Impairment
of goodwill
|
11,722
|
2,870
|
−
|
−
|
14,592
|
|||||||||||
Exit,
disposal, certain severance and other charges
|
1,479
|
459
|
−
|
−
|
1,938
|
|||||||||||
Operating
income
|
8,976
|
24,392
|
−
|
−
|
33,368
|
|||||||||||
Total
assets
|
236,430
|
90,604
|
17,877
|
766
|
345,677
|
|||||||||||
Goodwill
|
116,137
|
16,103
|
135
|
−
|
132,375
|
|||||||||||
Expenditures
of long-lived assets, net
|
5,932
|
5,871
|
107
|
−
|
11,910
|
|||||||||||
2005:
|
||||||||||||||||
Net
sales from external customers
|
$
|
266,398
|
$
|
153,220
|
$
|
−
|
$
|
−
|
$
|
419,618
|
||||||
Depreciation
and amortization expense
|
8,040
|
5,022
|
−
|
−
|
13,062
|
|||||||||||
Exit,
disposal, certain severance and other charges (credits)
|
(20
|
)
|
543
|
−
|
−
|
523
|
||||||||||
Operating
income
|
36,418
|
18,052
|
−
|
−
|
54,470
|
|||||||||||
Total
assets
|
253,348
|
75,033
|
58,590
|
20,809
|
407,780
|
|||||||||||
Goodwill
|
127,068
|
18,973
|
135
|
−
|
146,176
|
|||||||||||
Expenditures
of long-lived assets, net
|
5,758
|
11,053
|
481
|
−
|
17,292
|
|||||||||||
2004:
|
||||||||||||||||
Net
sales from external customers
|
$
|
271,215
|
$
|
104,385
|
$
|
−
|
$
|
−
|
$
|
375,600
|
||||||
Depreciation
and amortization expense
|
7,786
|
3,895
|
−
|
−
|
11,681
|
|||||||||||
Exit,
disposal, certain severance and other charges (credits)
|
(705
|
)
|
156
|
4,315
|
−
|
3,766
|
||||||||||
Operating
income (loss)
|
40,045
|
15,492
|
(4,315
|
)
|
−
|
51,222
|
||||||||||
Total
assets
|
270,243
|
48,352
|
47,823
|
23,859
|
390,277
|
|||||||||||
Goodwill
|
128,096
|
18,973
|
135
|
−
|
147,204
|
|||||||||||
Expenditures
of long-lived assets
|
8,051
|
2,253
|
516
|
−
|
10,820
|
As
of and for the
|
||||||||
Years
ended December 31,
|
||||||||
2006
|
2005
|
2004
|
||||||
Net
sales:
|
||||||||
United
States
|
$
|
471,513
|
$
|
388,849
|
$
|
342,418
|
||
Europe
and Canada
|
26,461
|
30,769
|
33,182
|
|||||
Consolidated
net sales
|
$
|
497,974
|
$
|
419,618
|
$
|
375,600
|
||
Long-lived
assets:
|
||||||||
United
States
|
$
|
185,319
|
$
|
186,254
|
$
|
182,254
|
||
Europe
|
3,528
|
14,794
|
17,188
|
|||||
Assets
of discontinued operations
|
−
|
2,247
|
2,804
|
|||||
Consolidated
long-lived assets
|
$
|
188,847
|
$
|
203,295
|
$
|
202,246
|
|
Termination
Benefits
|
Exit
/ Other
Costs
|
Loss
on
Write-Down
Of
Assets
|
Total
|
|||||||||||
Reserve
as of December 31, 2003
|
$
|
3,690
|
$
|
1,584
|
$
|
−
|
$
|
5,274
|
|||||||
Provision
2004
|
3,615
|
164
|
−
|
3,779
|
|||||||||||
Payments
2004
|
(2,166
|
)
|
(1,220
|
)
|
−
|
(3,386
|
)
|
||||||||
Non-cash
stock-based compensation write-offs 2004
|
(3,323
|
)
|
(525
|
)
|
−
|
(3,848
|
)
|
||||||||
Reserve
as of December 31, 2004
|
1,816
|
3
|
−
|
1,819
|
|||||||||||
Provision
2005
|
(17
|
)
|
258
|
282
|
523
|
||||||||||
Payments
2005
|
(1,539
|
)
|
(261
|
)
|
−
|
(1,800
|
)
|
||||||||
Asset
write-offs 2005
|
−
|
−
|
(282
|
)
|
(282
|
)
|
|||||||||
Reserve
as of December 31, 2005
|
260
|
−
|
−
|
260
|
|||||||||||
Provision
2006
|
1,159
|
779
|
−
|
1,938
|
|||||||||||
Payments
2006
|
(999
|
)
|
(496
|
)
|
−
|
(1,495
|
)
|
||||||||
Adjustment
2006
|
3
|
104
|
−
|
107
|
|||||||||||
Reserve
as of December 31, 2006
|
$
|
423
|
$
|
387
|
$
|
−
|
$
|
810
|
|
Termination
Benefits
|
Exit
/ Other
Costs
|
Loss
on
Write-Down
of
Assets
|
Total
|
|||||||||||
Total
amount expected to be incurred
|
$
|
1,186
|
$
|
2,065
|
$
|
817
|
$
|
4,068
|
|||||||
Total
amount incurred to date
|
$
|
1,186
|
$
|
2,065
|
$
|
817
|
$
|
4,068
|
|||||||
Reserve
as of December 31, 2003
|
$
|
571
|
$
|
399
|
$
|
200
|
$
|
1,170
|
|||||||
Provision
2004
|
(24
|
)
|
11
|
−
|
(13
|
)
|
|||||||||
Payments
- 2004
|
(547
|
)
|
(99
|
)
|
−
|
(646
|
)
|
||||||||
Reserve
as of December 31, 2004
|
−
|
311
|
200
|
511
|
|||||||||||
Payments
- 2005
|
−
|
(228
|
)
|
−
|
(228
|
)
|
|||||||||
Reserve
as of December 31, 2005
|
−
|
83
|
200
|
283
|
|||||||||||
Payments
2006
|
−
|
(23
|
)
|
−
|
(23
|
)
|
|||||||||
Asset
write-offs 2006
|
−
|
−
|
(200
|
)
|
(200
|
)
|
|||||||||
Adjustment
2006
|
−
|
(60
|
)
|
−
|
(60
|
)
|
|||||||||
Reserve
as of December 31, 2006
|
$
|
−
|
$
|
−
|
$
|
−
|
$
|
−
|
Quarter
|
|||||||||||||||
|
First
|
Second
|
Third
|
Fourth
|
|||||||||||
2006
|
|||||||||||||||
Net
sales
|
$
|
119,406
|
$
|
122,021
|
$
|
128,952
|
$
|
127,595
|
|||||||
Gross
profit
|
24,239
|
26,446
|
24,887
|
29,133
|
|||||||||||
Exit,
disposal, certain severance and other charges
|
106
|
581
|
918
|
333
|
|||||||||||
Impairment
of goodwill
|
-
|
-
|
14,592
|
-
|
|||||||||||
Income
(loss) from continuing operations
|
5,729
|
6,812
|
(3,941
|
)
|
9,141
|
||||||||||
Net
income (loss)
|
(3,200
|
)
|
6,764
|
(4,625
|
)
|
9,084
|
|||||||||
Income
from continuing operations per common share - basic and
diluted
|
$
|
0.26
|
$
|
0.31
|
$
|
(0.18
|
)
|
$
|
0.42
|
||||||
2005
|
|||||||||||||||
Net
sales
|
$
|
87,921
|
$
|
99,094
|
$
|
117,536
|
$
|
115,067
|
|||||||
Gross
profit
|
21,733
|
24,966
|
27,605
|
29,807
|
|||||||||||
Exit,
disposal, certain severance and other charges
|
86
|
348
|
89
|
-
|
|||||||||||
Income
from continuing operations
|
5,687
|
7,430
|
9,053
|
10,828
|
|||||||||||
Net
income
|
5,350
|
7,454
|
7,967
|
10,237
|
|||||||||||
Income
from continuing operations per common share - basic and
diluted
|
$
|
0.27
|
$
|
0.35
|
$
|
0.42
|
$
|
0.50
|
Name
|
Age
|
Positions
|
Donald
T. Johnson, Jr.
|
54
|
Chairman
of the Board, President and Chief Executive Officer
|
Todd
R. Peters
|
44
|
Vice
President and Chief Financial Officer
|
John
J. Machota
|
54
|
Vice
President, Human Resources
|
John
M. Pinkerton
|
49
|
Vice
President and Controller
|
Mary
T. Ryan
|
53
|
Vice
President, Communications and Investor Relations
|
Joseph
Salamunovich
|
47
|
Vice
President, General Counsel and Secretary
|
William
L. Conley, Jr.
|
58
|
President,
ATC Logistics
|
Brett
O. Dickson
|
42
|
Vice
President, North American Remanufacturing Operations
|
Robert
L. Evans
|
54
|
Director
|
Curtland
E. Fields
|
55
|
Director
|
Dr.
Michael J. Hartnett
|
61
|
Director
|
Michael
D. Jordan
|
60
|
Lead
Director
|
S.
Lawrence Prendergast
|
65
|
Director
|
Edward
Stewart
|
64
|
Director
|
•
|
to
align compensation with shareholder value
creation;
|
•
|
to
provide market competitive compensation to attract and retain talented
executives; and
|
•
|
to
link incentive compensation to continuous improvements in strategic
and
operating performance.
|
•
|
base
salary;
|
•
|
performance
based incentive compensation;
|
•
|
long-term
incentive/stock-based awards; and
|
•
|
supplemental
benefits.
|
•
|
market
data provided by the independent compensation
consultant;
|
•
|
internal
review of the executive’s compensation, both individually and relative to
other officers;
|
•
|
recommendations
of the CEO; and
|
•
|
individual
performance.
|
IC
Plan
|
||
Financial
Measure
|
2006
IC Goal
|
2006
Actual
|
Corporate
EPS
|
$1.55
|
$0.81
|
Drivetrain
adjusted EBIT
|
$42.4
million
|
$18.7
million
|
Logistics
adjusted EBIT
|
$23.2
million
|
$29.1
million
|
Name
and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
|
Stock
Awards
($)(1)
|
|
Option
Awards
($)(2)
|
Non-Equity
Incentive
Plan
Compen-sation
($)(3)
|
Change
in Pension Value and Non-qualified Deferred Compensation
Earnings
($)
|
|
All
Other Compen-
sation
($)
|
Total
($)
|
|||||||||||||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
||||||||||||||||||||
Donald
T. Johnson, Jr.
Chairman,
President, CEO
|
2006
|
$
|
535,000
|
(4) |
$
|
0
|
$
|
330,557
|
$
|
281,421
|
$
|
0
|
$
|
0
|
$
|
66,178
|
(5) |
$
|
1,213,156
|
||||||||||
Todd
R. Peters
Vice
President and CFO
|
2006
|
$
|
324,500
|
(6) |
$
|
0
|
$
|
151,876
|
$
|
125,414
|
$
|
0
|
$
|
0
|
$
|
17,009
|
(7) |
$
|
618,799
|
||||||||||
William
L. Conley, Jr.
President,
ATC Logistics & Electronics
|
2006
|
$
|
252,000
|
(8) |
$
|
0
|
$
|
55,964
|
$
|
37,796
|
$
|
159,472
|
(9) |
$
|
0
|
$
|
36,680
|
(10) |
$
|
541,912
|
|||||||||
Brett
O. Dickson
Vice
President, N.A.,
Reman
Operations
|
2006
|
$
|
260,000
|
(11) |
$
|
0
|
$
|
75,096
|
$
|
44,214
|
$
|
0
|
$
|
0
|
$
|
19,735
|
(12) |
$
|
399,045
|
||||||||||
Joseph
Salamunovich
Vice
President, General Counsel and Secretary
|
2006
|
$
|
234,600
|
(13) |
$
|
0
|
$
|
68,087
|
$
|
37,796
|
$
|
0
|
$
|
0
|
$
|
21,763
|
(14) |
$
|
362,246
|
(1)
|
See
Item 8. "Consolidated Financial Statements and Supplementary Data
- Note 2
- Stock-Based Compensation" for a description of the assumptions
used in the computation of our stock award fair
values.
|
(2)
|
See
Item 8. "Consolidated Financial Statements and Supplementary Data
- Note 2
- Stock-Based Compensation" for a description of the assumptions
used in the computation of our option award fair
values.
|
(3)
|
Bonuses
are paid under our incentive compensation plan for a particular year
if we
achieve or exceed specified EPS and other financial targets for the
year,
and are paid during the first quarter of the following
year.
|
(4)
|
Mr.
Johnson deferred $267,500 of this amount pursuant to our executive
deferred compensation plan. His base salary was increased to $560,000
effective January 1, 2007.
|
(5)
|
Consists
of $6,442 Company matching contribution under our 401(k) Plan, $28,076
Company matching contribution under our executive deferred compensation
plan, $20,000 automobile allowance, $10,700 reimbursement for club
dues
and personal financial planning costs, and $960 Company-paid life
insurance premiums.
|
(6)
|
Mr.
Peters' base salary was increased to $337,500 effective January 1,
2007.
|
(7)
|
Consists
of $9,600 automobile allowance; $6,490 reimbursement for club dues
and
financial planning costs; and $919 Company-paid life insurance
premiums.
|
(8)
|
Mr.
Conley deferred $25,200 of this amount pursuant to our executive
deferred
compensation plan. His base salary was increased to $260,000 effective
January 1, 2007.
|
(9)
|
Mr.
Conley deferred 50% of this amount pursuant to our executive deferred
compensation plan.
|
(10)
|
Consists
of $6,600 Company matching contribution under our 401(k) Plan, $14,550
Company matching contribution under our executive deferred compensation
plan, $9,600 automobile allowance, $5,040 reimbursement for club
dues and
personal financial planning costs; and $890 Company-paid life insurance
premiums.
|
(11)
|
Mr.
Dickson deferred $13,000 of this amount pursuant to our executive
deferred
compensation plan.
|
(12)
|
Consists
of $5,418 Company matching contribution under our 401(k) Plan, $8,510
Company matching contribution under our executive deferred compensation
plan, $4,900 reimbursement for club dues and personal financial planning
costs, and $907 Company-paid life insurance
premiums.
|
(13)
|
Mr.
Salamunovich's base salary was increased to $244,000 effective January
1,
2007.
|
(14)
|
Consists
of $6,600 Company matching contribution under our 401(k) Plan, $9,600
automobile allowance, $4,692 reimbursement for club dues and personal
financial planning costs, and $871 Company-paid life insurance
premiums.
|
|
|
|
|
Estimated
Future Payouts under Non-equity Incentive Plan
Awards(1)
|
Estimated
Future Payouts under Equity Incentive Plan
Awards
|
||||||||||||||||||||||||
Name
|
|
Grant
Date
|
|
Threshold
$
|
|
Target
$
|
|
Maximum
$
|
|
Threshold
#
|
|
Target
#
|
|
Maximum
#
|
|
All
Other Stock Awards: Num-
ber
of Shares of Stock or Units
(#)
|
|
All
Other Option
Awards:
Number
of
Securities Underlying Options
(#)
|
|
Exercise
or Base Price of Option Awards ($/Share)
|
|
Grant
Date Fair Value of Stock and Option Awards
|
|||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
|
(k)
|
(l)
|
|||||||||||||||||
Donald
T. Johnson, Jr.
|
$
|
361,125
|
$
|
481,500
|
$
|
1,444,500
|
-
|
-
|
-
|
- |
|
|
|
||||||||||||||||
6/1/06
|
|
|
|
|
|
18,750
|
(2) |
-
|
-
|
$
|
462,938
|
||||||||||||||||||
|
6/1/06
|
|
|
|
|
|
-
|
56,250
|
(3) |
$
|
24.69
|
$
|
465,677
|
||||||||||||||||
Todd
R. Peters
|
$
|
146,025
|
$
|
194,700
|
$
|
584,100
|
-
|
-
|
-
|
-
|
|
|
|
||||||||||||||||
|
6/1/06
|
|
|
|
|
|
5,625
|
(2) |
-
|
-
|
$
|
138,881
|
|||||||||||||||||
|
6/1/06
|
|
|
|
|
|
-
|
16,875
|
(2) |
$
|
24.69
|
$
|
139,703
|
||||||||||||||||
William
L. Conley, Jr.
|
$
|
94,500
|
$
|
126,000
|
$
|
378,000
|
-
|
-
|
-
|
-
|
|
|
|
||||||||||||||||
|
6/1/06
|
|
|
|
|
|
2,813
|
(2) |
-
|
-
|
$
|
69,453
|
|||||||||||||||||
|
6/1/06
|
|
|
|
|
|
-
|
8,437
|
(2) |
$
|
24.69
|
$
|
69,847
|
||||||||||||||||
Brett
O. Dickson
|
$
|
97,500
|
$
|
130,000
|
$
|
390,000
|
-
|
-
|
-
|
-
|
|
|
|
||||||||||||||||
|
6/1/06
|
|
|
|
|
|
2,813
|
(2) |
-
|
-
|
$
|
69,453
|
|||||||||||||||||
|
6/1/06
|
|
|
|
|
|
-
|
8,437
|
(2) |
$
|
24.69
|
$
|
69,847
|
||||||||||||||||
Joseph
Salamunovich
|
$
|
79,178
|
$
|
105,570
|
$
|
316,710
|
-
|
-
|
-
|
-
|
|
|
|
||||||||||||||||
|
6/1/06
|
|
|
|
|
|
2,813
|
(2) |
-
|
-
|
$
|
69,453
|
|||||||||||||||||
|
6/1/06
|
|
|
|
|
|
-
|
8,437
|
(2) |
$
|
24.69
|
$
|
69,847
|
(1) |
Established
under the annual Incentive Compensation Plan and payable if we
achieve or
exceed specified EPS and other financial targets for the year
ended
December 31, 2006 (provided that any bonus may be reduced by
up to 20% if
certain quality and service metrics are not achieved). The amounts
shown
in column (c) reflect the minimum payments under the Incentive
Compensation Plan which is 75% of the target amount shown in
column (d).
The amount shown in column (e) is 300% of such target amount.
These
amounts are based on the individual’s current salary and position. Based
on our performance in 2006, none of these amounts are payable
except in
the case of Mr. Conley.
|
(2) |
Awarded
under the 2004 Stock Incentive Plan. No consideration was paid
for the
award.
|
(3) |
Awarded
under the 2000 Stock Incentive Plan. No consideration was paid
for the
award.
|
Options
Awards
|
Stock
Awards
|
||||||||||||||||||||||||||||
Name
|
|
Number
of Securities Underlying Unexercised Options
(#)
Exercisable
|
|
Number
of Securities Underlying Unexercised Options
(#)
Unexercisable
|
|
Equity
Incentive
Plan
Awards Number of Securities Underlying Unexercised Unearned
Options
(#)
|
Option
Exercise
Price
($)
|
Option
Expi-ration
Date
|
Number
of Shares or Units of Stock That Have Not Vested
(#)
|
Market
Value of Shares or Units of Stock That Have Not
Vested
($)
|
Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other
Rights
That Have Not Vested
(#)
|
Equity
Incentive
Plan Awards: Market or Payout Value of Unearned Shares, Units or
Other
Rights That Have Not Vested
($)
|
|||||||||||||||||
(a)
|
|
(b)
|
|
(c)
|
(d)
|
|
(e)
|
|
(f)
|
(g)
|
(h)
|
|
(i)
|
(j)
|
|||||||||||||||
Donald
T. Johnson, Jr.
|
-
|
35,416
|
(1)
|
$
|
753,652
|
-
|
-
|
||||||||||||||||||||||
93,333
|
46,667
|
(2)
|
$
|
14.0000
|
01/02/14
|
||||||||||||||||||||||||
75,000
|
-
|
$
|
15.8500
|
06/02/15
|
|||||||||||||||||||||||||
-
|
56,250
|
(3)
|
|
$
|
24.6900
|
06/01/16
|
|
|
|
|
|||||||||||||||||||
Todd
R. Peters
|
-
|
18,958
|
(4)
|
$
|
403,426
|
-
|
-
|
||||||||||||||||||||||
-
|
23,333
|
(5)
|
$
|
14.8500
|
03/09/14
|
||||||||||||||||||||||||
-
|
16,875
|
(3)
|
$
|
24.6900
|
06/01/16
|
||||||||||||||||||||||||
William
L. Conley, Jr.
|
-
|
6,146
|
(6)
|
$
|
130,787
|
-
|
-
|
||||||||||||||||||||||
25,000
|
-
|
$
|
14.1100
|
08/07/12
|
|||||||||||||||||||||||||
6,667
|
3,333
|
(7)
|
$
|
14.9000
|
05/12/14
|
||||||||||||||||||||||||
11,250
|
-
|
$
|
15.8500
|
06/02/15
|
|||||||||||||||||||||||||
-
|
8,437
|
(3)
|
$
|
24.6900
|
06/01/16
|
||||||||||||||||||||||||
Brett
O. Dickson
|
-
|
8,646
|
(8)
|
$
|
183,987
|
-
|
-
|
||||||||||||||||||||||
5,000
|
-
|
$
|
22.9000
|
05/08/12
|
|||||||||||||||||||||||||
-
|
5,000
|
(7)
|
$
|
14.9000
|
05/12/14
|
||||||||||||||||||||||||
-
|
8,437
|
(3)
|
$
|
24.6900
|
06/01/16
|
||||||||||||||||||||||||
Joseph
Salamunovich
|
-
|
6,980
|
(9)
|
$
|
148,534
|
-
|
-
|
||||||||||||||||||||||
10,000
|
-
|
$
|
18.1250
|
05/12/08
|
|||||||||||||||||||||||||
25,000
|
-
|
$
|
22.9000
|
05/08/12
|
|||||||||||||||||||||||||
6,667
|
3,333
|
(7)
|
$
|
14.9000
|
05/12/14
|
||||||||||||||||||||||||
11,250
|
-
|
$
|
15.8500
|
06/02/15
|
|||||||||||||||||||||||||
-
|
8,437
|
(3)
|
$
|
24.6900
|
06/01/16
|
(1) |
14,583
vest in June 2007; 14,583 vest in June 2008; and 6,250 vest in June
2009.
|
(2) |
Vest
in January 2007.
|
(3) |
Vest
in equal installments in June 2007, June 2008 and June
2009.
|
(4) |
8,333
shares vest in March 2007; 4,375 shares vest in June 2007; 4,375
vest in
June 2008; and 1,875 shares vest in June
2009.
|
(5) |
Vest
in March 2007.
|
(6) |
833
shares vest in May 2007; 2,188 shares vest in June 2007; 2,188 shares
vest
in June 2008; and 937 shares vest in June
2009.
|
(7) |
Vest
in May 2007.
|
(8) |
3,333
shares vest in May 2007; 2,188 shares vest in June 2007; 2,188 shares
vest
in June 2008; and 937 shares vest in June
2009.
|
(9) |
1,667
shares vest in May 2007; 2,188 shares vest in June 2007; 2,188 shares
vest
in June 2008; and 937 shares vest in June
2009.
|
|
Option
Awards
|
Restricted
Stock Awards
|
||||||||||
Name
|
Number
of Shares Acquired on Exercise
(#)
|
Value
Realized Upon Exercise
($)
|
Number
of Shares Acquired on Vesting
(#)
|
Value
Realized Upon Vesting
($)
|
||||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
||||||||
Donald
T. Johnson, Jr.
|
-
|
-
|
8,334
|
$
|
207,350
|
|||||||
Todd
R. Peters
|
69,167
|
$
|
769,804
|
10,833
|
$
|
243,859
|
||||||
William
L. Conley, Jr.
|
-
|
-
|
2,083
|
$
|
51,758
|
|||||||
Brett
O. Dickson
|
33,750
|
$
|
328,299
|
4,583
|
$
|
113,758
|
||||||
Joseph
Salamunovich
|
-
|
-
|
4,583
|
$
|
101,773
|
Name
|
Executive
Contributions in Last FY
($)(1)
|
Registrant
Contributions in
Last
FY
($)(2)(3)
|
Aggregate
Earnings
in
Last FY
($)(4)(5)
|
Aggregate
Withdrawals/ Distributions
($)
|
Aggregate
Balance
at
Last
FYE
($)
|
||||||||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
||||||||||||
Donald
T. Johnson, Jr.
|
$
|
956,614
|
$
|
28,076
|
(6)
|
$
|
84,784
|
-
|
$
|
1,254,218
|
(7)
|
||||||
Todd
R. Peters
|
-
|
-
|
-
|
-
|
-
|
||||||||||||
William
L. Conley, Jr.
|
$
|
128,200
|
$
|
14,550
|
(8)
|
$
|
16,736
|
-
|
$
|
176,617
|
(9)
|
||||||
Brett
O. Dickson
|
$
|
13,000
|
$
|
8,510
|
(10)
|
$
|
3,810
|
-
|
$
|
34,603
|
(11)
|
||||||
Joseph
Salamunovich
|
-
|
-
|
-
|
-
|
-
|
(1)
|
A
portion of these amounts were reported as compensation in the Summary
Compensation Table in prior years.
|
(2)
|
All
of these amounts are reported as "All Other Compensation" in the
Summary
Compensation Table.
|
(3)
|
In
2006, the Company provided a matching contribution of $0.50 per $1.00
of
the first 10% of base salary
deferred.
|
(4)
|
None
of these amounts are reported as 2006 compensation in the Summary
Compensation Table.
|
(5)
|
The
aggregate earnings for 2006 are based on the returns of externally
managed
mutual funds. We maintain a grantor trust underlying the deferred
compen-
sation
plan
through which we generally seek to match assets to liabilities under
the
plan.
|
(6)
|
Includes
special Company contribution of $1,393 to replace a forfeited 401(k)
Plan
Company matching contribution.
|
(7)
|
Includes
$885,077 previously reported as compensation in the Summary Compensation
Table for prior years.
|
(8)
|
Includes
special Company contribution of $1,973 to replace a forfeited 401(k)
Plan
Company matching contribution.
|
(9)
|
Includes
$119,642 previously reported as compensation in the Summary Compensation
Table for prior years.
|
(10)
|
Includes
special Company contribution of $1,760 to replace a forfeited 401(k)
Plan
Company matching contribution.
|
(11)
|
Includes
$9,000 previously reported as compensation in the Summary Compensation
Table for prior years.
|
Name
of Fund
|
Rate
of
Return
|
Name
of Fund
|
Rate
of
Return
|
American
Century Equity Income Adv. Fund
|
19.3%
|
Principal
Investors Money Market Pfd. Fund
|
4.50%
|
American
Funds EuroPacific Growth R3 Fund
|
21.43%
|
Principal
Investors Partners MidCap Value Pfd. Fund
|
13.29%
|
American
Funds Growth Fund of America R3 Fund
|
10.62%
|
Principal
Investors Real Estate Securities Pfd. Fund
|
36.16%
|
Calvert
Social Investment Bond A Fund
|
4.28%
|
Principal
Investors SmallCap Blend Pfd. Fund
|
13.95%
|
Lord
Abbett All Value P Fund
|
13.62%
|
Principal
Investors SmallCap Value Pfd. Fund
|
18.50%
|
Principal
Investors International Growth Pfd. Fund
|
24.01%
|
Russell
LifePoints® Balanced Strategy E Fund
|
12.84%
|
Principal
Investors LargeCap Growth Pfd. Fund
|
9.59%
|
Russell
LifePoints® Equity Growth Strategy E Fund
|
18.59%
|
Principal
Investors MidCap Blend Pfd. Fund
|
13.81%
|
Executive
Benefits and
Payments
Upon Termination
|
Voluntary
Termination Without Board- approved Transition
|
Voluntary
Termina-tion With Board- approved Transition
|
For
Cause Termi-nation
|
Involuntary
Termination Without Cause(1)
|
Involuntary
Termination Without Cause Within 18
Months
after
CIC(1)
|
Death
|
Disability
|
Retirement
|
||||||||||||||||
Compensation:
|
||||||||||||||||||||||||
Base
Salary
|
-
|
$
|
802,500
|
-
|
$
|
802,500
|
$
|
802,500
|
-
|
$
|
802,500
|
-
|
||||||||||||
Short-term
Incentive
|
||||||||||||||||||||||||
Pro-rated
award
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||
Earned
award
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||
Pro-Forma
award
|
-
|
-
|
-
|
-
|
$
|
481,500
|
-
|
-
|
-
|
|||||||||||||||
Stock
Options(2)
|
-
|
-
|
-
|
-
|
$
|
339,736
|
$
|
339,736
|
$
|
339,736
|
-
|
|||||||||||||
Restricted
Stock(3)
|
-
|
-
|
-
|
-
|
$
|
753,652
|
$
|
753,652
|
$
|
753,652
|
-
|
|||||||||||||
Benefits
and Perquisites:
|
||||||||||||||||||||||||
Medical
Plan Coverage(4)
|
-
|
$
|
9,000
|
-
|
$
|
9,000
|
$
|
9,000
|
-
|
$
|
9,000
|
-
|
||||||||||||
Life
Insurance Proceeds
|
-
|
-
|
-
|
-
|
-
|
$
|
500,000
|
-
|
-
|
|||||||||||||||
Vested
Portion of Company
Match
of Deferred Comp.
|
$
|
16,939
|
$
|
16,939
|
$
|
16,939
|
$
|
16,939
|
$
|
42,346
|
$
|
42,346
|
$
|
42,346
|
$
|
42,346
|
||||||||
Accrued
Vacation Pay
|
$
|
5,200
|
$
|
5,200
|
$
|
5,200
|
$
|
5,200
|
$
|
5,200
|
$
|
5,200
|
$
|
5,200
|
$
|
5,200
|
||||||||
Outplacement
Assistance
|
-
|
$
|
25,000
|
-
|
$
|
25,000
|
$
|
25,000
|
-
|
-
|
-
|
|||||||||||||
280G
Tax Gross Up
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||
Total:
|
$
|
22,139
|
$
|
858,639
|
$
|
22,139
|
$
|
858,639
|
$
|
2,458,934
|
$
|
1,640,934
|
$
|
1,952,434
|
$
|
47,546
|
Executive
Benefits and
Payments
Upon Termination
|
Voluntary
Termination
|
For
Cause Termination
|
Involuntary
Termination Without Cause(1)
|
Involuntary
Termination Without Cause Within 18 Months after CIC(1)
|
Death
|
Disability
|
Retirement
|
||||||||||||||
Compensation:
|
|||||||||||||||||||||
Base
Salary
|
-
|
-
|
$
|
486,750
|
$
|
486,750
|
-
|
-
|
-
|
||||||||||||
Short-term
Incentive
|
|||||||||||||||||||||
Pro-rated
award
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Earned
award
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Pro-Forma
award
|
-
|
-
|
-
|
$
|
194,700
|
-
|
-
|
-
|
|||||||||||||
Stock
Options(2)
|
-
|
-
|
-
|
$
|
150,031
|
$
|
150,031
|
$
|
150,031
|
-
|
|||||||||||
Restricted
Stock(3)
|
-
|
-
|
-
|
$
|
403,426
|
$
|
403,426
|
$
|
403,426
|
-
|
|||||||||||
Benefits
and Perquisites:
|
|||||||||||||||||||||
Medical
Plan Coverage(4)
|
-
|
-
|
$
|
12,200
|
$
|
12,200
|
-
|
-
|
-
|
||||||||||||
Life
Insurance Proceeds
|
-
|
-
|
-
|
-
|
$
|
500,000
|
-
|
-
|
|||||||||||||
Vested
Portion of Company
Match
of Deferred Comp.
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Accrued
Vacation Pay
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Outplacement
Assistance
|
-
|
-
|
$
|
25,000
|
$
|
25,000
|
-
|
-
|
-
|
||||||||||||
280G
Tax Gross Up
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Total:
|
-
|
-
|
$
|
523,950
|
$
|
1,272,107
|
$
|
1,053,457
|
$
|
553,457
|
-
|
Executive
Benefits and
Payments
Upon Termination
|
Voluntary
Termination
|
For
Cause Termination
|
Involuntary
Termination Without Cause(1)
|
Involuntary
Termination Without Cause Within 18 Months after CIC(1)
|
Death
|
Disability
|
Retirement
|
||||||||||||||
Compensation:
|
|||||||||||||||||||||
Base
Salary
|
-
|
-
|
$
|
252,000
|
$
|
252,000
|
-
|
-
|
-
|
||||||||||||
Short-term
Incentive
|
|||||||||||||||||||||
Pro-rated
award
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Earned
award
|
$
|
159,472
|
$
|
159,472
|
$
|
159,472
|
$
|
159,472
|
$
|
159,472
|
$
|
159,472
|
$
|
159,472
|
|||||||
Pro-Forma
award
|
-
|
-
|
-
|
$
|
126,000
|
-
|
-
|
-
|
|||||||||||||
Stock
Options(2)
|
-
|
-
|
-
|
$
|
21,265
|
$
|
21,265
|
$
|
21,265
|
-
|
|||||||||||
Restricted
Stock(3)
|
-
|
-
|
-
|
$
|
130,787
|
$
|
130,787
|
$
|
130,787
|
-
|
|||||||||||
Benefits
and Perquisites:
|
|||||||||||||||||||||
Medical
Plan Coverage(4)
|
-
|
-
|
$
|
6,000
|
$
|
6,000
|
-
|
-
|
-
|
||||||||||||
Life
Insurance Proceeds
|
-
|
-
|
-
|
-
|
$
|
500,000
|
-
|
-
|
|||||||||||||
Vested
Portion of Company
Match
of Deferred Comp.
|
$
|
17,841
|
$
|
17,841
|
$
|
17,841
|
$
|
22,302
|
$
|
22,302
|
$
|
22,302
|
$
|
22,302
|
|||||||
Accrued
Vacation Pay
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Outplacement
Assistance
|
-
|
-
|
$
|
25,000
|
$
|
25,000
|
-
|
-
|
-
|
||||||||||||
280G
Tax Gross Up
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Total:
|
$
|
177,313
|
$
|
177,313
|
$
|
460,313
|
$
|
742,826
|
$
|
833,826
|
$
|
333,826
|
$
|
181,774
|
Executive
Benefits and
Payments
Upon Termination
|
Voluntary
Termination
|
For
Cause Termination
|
Involuntary
Termination Without Cause(1)
|
Involuntary
Termination Without Cause Within 18 Months after CIC(1)
|
Death
|
Disability
|
Retirement
|
||||||||||||||
Compensation:
|
|||||||||||||||||||||
Base
Salary
|
-
|
-
|
$
|
260,000
|
$
|
260,000
|
-
|
-
|
-
|
||||||||||||
Short-term
Incentive
|
|||||||||||||||||||||
Pro-rated
award
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Earned
award
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Pro-Forma
award
|
-
|
-
|
-
|
$
|
130,000
|
-
|
-
|
-
|
|||||||||||||
Stock
Options(2)
|
-
|
-
|
-
|
$
|
31,900
|
$
|
31,900
|
$
|
31,900
|
-
|
|||||||||||
Restricted
Stock(4)
|
-
|
-
|
-
|
$
|
183,987
|
$
|
183,987
|
$
|
183,987
|
-
|
|||||||||||
Benefits
and Perquisites:
|
|||||||||||||||||||||
Medical
Plan Coverage(4)
|
-
|
-
|
$
|
8,100
|
$
|
8,100
|
-
|
-
|
-
|
||||||||||||
Life
Insurance Proceeds
|
-
|
-
|
-
|
-
|
$
|
500,000
|
-
|
-
|
|||||||||||||
Vested
Portion of Company
Match
of Deferred Comp.
|
$
|
13,089
|
$
|
13,089
|
$
|
13,089
|
$
|
13,089
|
$
|
13,089
|
$
|
13,089
|
$
|
13,089
|
|||||||
Accrued
Vacation Pay
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Outplacement
Assistance
|
-
|
-
|
$
|
25,000
|
$
|
25,000
|
-
|
-
|
-
|
||||||||||||
280G
Tax Gross Up
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Total:
|
$
|
13,089
|
$
|
13,089
|
$
|
306,189
|
$
|
652,076
|
$
|
728,976
|
$
|
228,976
|
$
|
13,089
|
Executive
Benefits and
Payments
Upon Termination
|
Voluntary
Termination
|
For
Cause Termination
|
Involuntary
Termination Without Cause(1)
|
Involuntary
Termination Without Cause Within 18 Months after CIC(1)
|
Death
|
Disability
|
Retirement
|
||||||||||||||
Compensation:
|
|||||||||||||||||||||
Base
Salary
|
-
|
-
|
$
|
234,600
|
$
|
234,600
|
-
|
-
|
-
|
||||||||||||
Short-term
Incentive
|
|||||||||||||||||||||
Pro-rated
award
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Earned
award
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Pro-Forma
award
|
-
|
-
|
-
|
$
|
105,570
|
-
|
-
|
-
|
|||||||||||||
Stock
Options(2)
|
-
|
-
|
-
|
$
|
21,265
|
$
|
21,265
|
$
|
21,265
|
-
|
|||||||||||
Restricted
Stock(3)
|
-
|
-
|
-
|
$
|
148,534
|
$
|
148,534
|
$
|
148,534
|
-
|
|||||||||||
Benefits
and Perquisites
|
|||||||||||||||||||||
Medical
Plan Coverage(4)
|
-
|
-
|
$
|
8,100
|
$
|
8,100
|
-
|
-
|
-
|
||||||||||||
Life
Insurance Proceeds
|
-
|
-
|
-
|
-
|
$
|
469,200
|
-
|
-
|
|||||||||||||
Vested
Portion of Company
Match
of Deferred Comp.
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Accrued
Vacation Pay
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Outplacement
Assistance
|
-
|
-
|
$
|
25,000
|
$
|
25,000
|
-
|
-
|
-
|
||||||||||||
280G
Tax Gross Up
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
Total:
|
-
|
-
|
$
|
267,700
|
$
|
543,069
|
$
|
638,999
|
$
|
169,799
|
-
|
Name
|
Fees
earned
or
paid
in
cash
($)
|
Stock
Awards
($)(1)
|
Option
Awards
($)(2)
|
Non-
Equity
Incentive
Plan
Compen-sation
($)
|
Change
in Pension Value and Nonqualified Deferred Compensation
Earnings
($)
|
All
Other Compen-sation
($)
|
Total
($)
|
||||||||||||||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
||||||||||||||||||
Robert
L. Evans
|
$
|
50,000
|
$
|
29,750
|
(3)
(4)
|
$
|
17,954
|
(5)
(6)
|
-
|
-
|
-
|
$
|
97,704
|
||||||||||||
Curtland
E. Fields
|
$
|
50,000
|
$
|
29,750
|
(3)
(4)
|
$
|
17,954
|
(5)
(6)
|
-
|
-
|
-
|
$
|
97,704
|
||||||||||||
Michael
J. Hartnett
|
$
|
50,000
|
$
|
29,750
|
(3)
(4)
|
$
|
28,552
|
(5)
(7)
|
-
|
-
|
-
|
$
|
108,302
|
||||||||||||
Michael
D. Jordan
|
$
|
50,000
|
(8)
|
$
|
29,750
|
(3)
(4)
|
$
|
41,080
|
(5)
(6)
|
-
|
-
|
-
|
$
|
120,830
|
|||||||||||
S.
Lawrence Prendergast
|
$
|
50,000
|
$
|
29,750
|
(3)
(4)
|
$
|
41,080
|
(5)
(6)
|
-
|
-
|
-
|
$
|
120,830
|
||||||||||||
Edward
Stewart
|
$
|
50,000
|
(8)
|
$
|
29,750
|
(3)
(4)
|
$
|
17,954
|
(5)
(6)
|
-
|
-
|
-
|
$
|
97,704
|
(1)
|
See
Item 8. "Consolidated Financial Statements and Supplementary Data
- Note 2
- Stock-Based
Compensation"
for a description of the assumptions used in the computation of our
stock
award fair values.
|
(2)
|
See
Item 8. "Consolidated Financial Statements and Supplementary Data
- Note 2
- Stock-Based
Compensation"
for a description of the assumptions used in the computation of our
option
award fair values.
|
(3)
|
The
grant date fair value of 1,500 shares of restricted stock granted
on June
1, 2006 was $37,035.
|
(4)
|
As
of December 31, 2006, the director held 3,166 shares of restricted
stock.
|
(5)
|
The
grant date fair value of 4,500 options to purchase common stock granted
on
June 1, 2006 to a director was
$50,245.
|
(6)
|
As
of December 31, 2006, the director held 32,000 options to purchase
common
stock.
|
(7)
|
As
of December 31, 2006, the director held 127,000 options to purchase
common
stock.
|
(8)
|
Entire
2006 cash retainer has been deferred in Company's Nonqualified Deferred
Compensation Plan.
|
Beneficial
Owner (1)
|
Number
of
Shares(2)
|
Voting
Percentage
|
||
Wells
Fargo & Company (3)
|
1,939,108
|
8.9
|
||
Daruma
Asset Management, Inc. (4)
|
1,703,300
|
7.8
|
||
Pzena
Investment Management, LLC (5)
|
1,645,394
|
7.5
|
||
FMR
Corp. (6)
|
1,381,702
|
6.3
|
||
Donald
T. Johnson, Jr. (7)
|
338,607
|
1.5
|
||
Todd
R. Peters (8)
|
55,429
|
*
|
||
Brett
O. Dickson (9)
|
13,646
|
*
|
||
William
L. Conley, Jr. (10)
|
51,980
|
*
|
||
Joseph
Salamunovich (11)
|
66,656
|
*
|
||
Robert
L. Evans (12)
|
31,500
|
*
|
||
Curtland
E. Fields (12)
|
31,500
|
*
|
||
Dr.
Michael J. Hartnett (13)
|
126,500
|
*
|
||
Michael
D. Jordan (14)
|
24,833
|
*
|
||
S.
Lawrence Prendergast (14)
|
25,833
|
*
|
||
Edward
Stewart (12)
|
48,500
|
*
|
||
All
directors and officers as a group (14 persons)
(15)
|
975,307
|
4.3
|
(1)
|
Unless
otherwise noted, the address of each beneficial owner is 1400 Opus
Place,
Suite 600, Downers Grove, IL 60515.
|
(2)
|
The
shares of common stock underlying options granted under our stock
incentive plans that are exercisable as of February 15, 2007 or that
will become exercisable within 60 days thereafter (such options being
referred to as “exercisable”) are deemed to be outstanding for the purpose
of calculating the beneficial ownership of the holder of such options,
but
are not deemed to be outstanding for the purpose of computing the
beneficial ownership of any other person.
|
(3)
|
Wells
Fargo & Company’s address is 420 Montgomery Street, San Francisco, CA
94104.
|
(4)
|
Daruma
Asset Management, Inc.’s address is 80 West 40th
Street, 9th
Floor, New York, NY 10018.
|
(5)
|
Pzena
Investment Management, LLC’s address is 120 West 45th
Street, 20th
Floor, New York, NY 10036.
|
(6)
|
FMR
Corp.’s address is 82 Devonshire Street, Boston, MA
02109.
|
(7)
|
Includes
64,816 shares of restricted stock and 215,000 shares subject to
exercisable options. Excludes 143,950 shares subject to options that
are
not exercisable.
|
(8)
|
Includes
18,958 shares of restricted stock and 23,333 shares subject to exercisable
options. Excludes 16,875 shares subject to options that are not
exercisable.
|
(9)
|
Consists
of 8,646 shares of restricted stock and 5,000 shares subject to
exercisable options. Excludes 13,437 shares subject to options that
are
not exercisable.
|
(10)
|
Includes
6,146 shares of restricted stock and 42,917 shares subject to exercisable
options. Excludes 11,770 shares subject to options that are not
exercisable.
|
(11)
|
Includes
6,980 shares of restricted stock and 52,917 shares subject to exercisable
options. Excludes 11,770 shares subject to options that are not
exercisable.
|
(12)
|
Includes
3,166 shares of restricted stock and 27,500 shares subject to exercisable
options. Excludes 4,500 shares subject to options that are not
exercisable.
|
(13)
|
Includes
3,166 shares of restricted stock and 122,500 shares subject to exercisable
options. Excludes 4,500 shares subject to options that are not
exercisable.
|
(14)
|
Includes
3,166 shares of restricted stock and 20,833 shares subject to exercisable
options. Excludes 11,167 shares subject to options that are not
exercisable.
|
(15)
|
Includes
144,482 shares of restricted stock and 714,167 shares subject to
exercisable options. Excludes 272,780 shares subject to options
that are
not exercisable.
|
Plan
category
|
Number
of securities
to
be issued
upon
exercise of
outstanding
options,
warrants
and rights
|
Weighted-average
exercise
price of
outstanding
options,
warrants
and rights
|
Number
of securities
remaining
available for
future
issuances under
equity
compensation plans
(excluding
securities
reflected
in column (a))
|
|||
(a)
|
(b)
|
(c)
|
||||
Equity
compensation plans
approved
by security holders
|
1,506,448
|
$ 20.10
|
1,195,679
|
|||
Equity
compensation plans not approved by security holders
|
-
|
-
|
-
|
|||
Total
|
1,506,448
|
1,195,679
|
2006
|
2005
|
||||
Audit
Fees (1)
|
$
|
1,101,430
|
$
|
1,088,424
|
|
Audit-Related
Fees (2)
|
178,896
|
120,537
|
|||
Tax
Fees (3)
|
44,958
|
69,081
|
|||
All
Other Fees (4)
|
6,600
|
-
|
|||
Total
Fees
|
$
|
1,331,884
|
$
|
1,278,042
|
(1)
|
The
fees for 2005 are $39,024 higher than reported in our Annual Report
on
Form 10-K for the year ended December 31, 2005 due to audit fees
incurred
but not
communicated until after the filing of the 2005 Annual Report. |
(2)
|
For
2006 consists of fees and expenses for services relating to (i) a
Statement of Auditing Standards No. 70 review ($128,896) and (ii)
diligence for a potential
acquisition ($50,000). For 2005 consists of fees and expenses for services relating to a Statement of Auditing Standards No. 70 review and was reclassified from "All Other Fees" as reported in the 2005 Annual Report. |
(3)
|
For
2006 consists of fees and expenses for assistance with (i) state,
federal and foreign tax returns ($35,939) and (ii) other foreign tax
related assistance ($9,019).
For 2005 consists of fees and expenses for assistance with (i) state, federal and foreign tax returns ($63,712) and (ii) other tax audits ($5,369). |
(4)
|
For
2006 consists of fees and expenses for services relating to assurance
services for a customer.
|
(a)
|
Index
to Financial Statements, Financial Statement Schedules and
Exhibits:
|
|
|||
See
Index to Financial Statements and Supplemental Data on page
40.
|
|||
2.
|
Financial
Statement Schedules Index
|
||
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.
|
|||
3.
|
Exhibit
Index
|
||
The
following exhibits are filed as part of this Annual Report on Form
10-K,
or are incorporated herein by reference:
|
|||
Exhibit
Number
|
Description
|
||
3.1
|
Restated
Certificate of Incorporation of Aftermarket Technology Corp (previously
filed as Exhibit 3.1 to the Company's Current Report on Form 8-K
filed on
December 21, 2001 and incorporated herein by this
reference)
|
||
3.2
|
Bylaws
of Aftermarket Technology Corp. (previously filed as Exhibit 3.2
to the
Company's Annual Report on Form 10-K for the year ended
December 31, 2005 and incorporated herein by this
reference)
|
||
10.1
|
Amended
and Restated Tax Sharing Agreement, dated as of December 20, 1996,
among Aftermarket Technology Holdings Corp., Aaron's Automotive
Products, Inc., ATC Components, Inc., CRS Holdings Corp.,
Diverco Acquisition Corp., H.T.P., Inc., Mamco Converters, Inc.,
R.P.M. Merit, Inc. and Tranzparts Acquisition Corp. (previously filed
as Exhibit 10.8 to the Company's Annual Report on Form 10-K for the
year ended December 31, 1996 and incorporated herein by this
reference)
|
||
10.2†
|
Aftermarket
Technology Corp. 1996 Stock Incentive Plan (previously filed as Exhibit
10.10 to the Company's Annual Report on Form 10-K for the year ended
December 31, 1996 and incorporated herein by this
reference)
|
||
10.3†
|
Form
of Non-Qualified Stock Option Agreement
under the Aftermarket Technology Corp. 1996 Stock Incentive
Plan
(previously filed as Exhibit 10.37 to Amendment No. 1 to the Company's
Registration Statement on Form S-1 filed on October 25, 1996,
Commission File No. 333-5597, and incorporated herein by this
reference)
|
||
10.4†
|
Aftermarket
Technology Corp. 1998 Stock Incentive Plan (previously filed as
Exhibit 10.55 to the Company's Annual Report on Form 10-K for
the year ended December 31, 1998 and incorporated herein by this
reference)
|
||
10.5†
|
Aftermarket
Technology Corp. 2000 Stock Incentive Plan (previously filed as
Exhibit 10.57 to the Company's Annual Report on Form 10-K for
the year ended December 31, 2000 and incorporated herein by this
reference)
|
||
10.6†
|
Aftermarket
Technology Corp. 2002 Stock Incentive Plan (previously filed as
Exhibit 10.31 to the Company's Annual Report on Form 10-K for
the year ended December 31, 2002 and incorporated herein by this
reference)
|
||
10.7†
|
Aftermarket
Technology Corp. 2004 Stock Incentive Plan
(previously filed as Exhibit 10.1 to the Company's Current Report
on Form
8-K filed on December 14, 2004 and incorporated herein by this
reference)
|
10.8†
|
Standard
Terms and Conditions Governing Nonemployee Director Stock Options
Granted
on or after May 12, 2004 under the Aftermarket Technology Corp. 1998,
2000, 2002, and 2004 Stock Incentive Plans
(previously filed as Exhibit 10.2 to the Company's Current Report
on Form
8-K filed on December 14, 2004 and incorporated herein by this
reference)
|
10.9†
|
Standard
Terms and Conditions Governing Employee Non-Qualified Stock Options
Granted on or after May 12, 2004 under the Aftermarket Technology
Corp. 1998, 2000, 2002, and 2004 Stock Incentive Plans
(previously filed as Exhibit 10.3 to the Company's Current Report
on Form
8-K filed on December 14, 2004 and incorporated herein by this
reference)
|
10.10†
|
Standard
Terms and Conditions Governing Nonemployee Director Stock Options
under
the Aftermarket Technology Corp. 1998, 2000 and 2002 Stock Incentive
Plans
(previously filed as Exhibit 10.4 to the Company's Current Report
on Form
8-K filed on December 14, 2004 and incorporated herein by this
reference)
|
10.11†
|
Standard
Terms and Conditions Governing Employee Non-Qualified Stock Options
under
the Aftermarket Technology Corp. 1998, 2000 and 2002 Stock Incentive
Plans
(previously filed as Exhibit 10.5 to the Company's Current Report
on Form
8-K filed on December 14, 2004 and incorporated herein by this
reference)
|
10.12†
|
Aftermarket
Technology Corp. 2006 Stock Incentive Plan
(previously filed as Exhibit 10.1 to the Company's Current Report
on Form
8-K filed on June 6, 2006 and incorporated herein by this
reference)
|
10.13†
|
Standard
Terms and Conditions Governing Nonemployee Director Stock Options
under
the Aftermarket Technology Corp. 2006 Stock Incentive Plan
(previously filed as Exhibit 10.2 to the Company's Current Report
on Form
8-K filed on June 6, 2006 and incorporated herein by this
reference)
|
10.14†
|
Standard
Terms and Conditions Governing Employee Non-Qualified Stock Options
under
the Aftermarket Technology Corp. 2006 Stock Incentive Plan
(previously filed as Exhibit 10.3 to the Company's Current Report
on Form
8-K filed on June 6, 2006 and incorporated herein by this
reference)
|
10.15†
|
Form
of Restricted Stock Agreement for Nonemployee Directors under
the Aftermarket Technology Corp. 1998, 2000, 2002, 2004 and 2006
Stock
Incentive Plans
(previously filed as Exhibit 10.4 to the Company's Current Report
on Form
8-K filed on June 6, 2006 and incorporated herein by this
reference)
|
10.16†
|
Form
of Restricted Stock Agreement for Employee under
the Aftermarket Technology Corp. 1998, 2000, 2002, 2004 and 2006
Stock
Incentive Plans
(previously filed as Exhibit 10.5 to the Company's Current Report
on Form
8-K filed on June 6, 2006 and incorporated herein by this
reference)
|
10.17†
|
Aftermarket
Technology Corp. Executive Nonqualified Excess Plan (previously filed
as
Exhibit 10 to the Company's Current Report on Form 8-K filed on
June 6, 2005 and incorporated herein by this
reference)
|
10.18†
|
Aftermarket
Technology Corp. Executive Nonqualified Excess Plan Adoption Agreement
(previously filed as Exhibit 10 to the Company's Current Report on
Form
8-K filed on September 18, 2006 and incorporated herein by this
reference)
|
10.20†
|
Executive
Employment Agreement, dated as of March 9, 2004, between Aftermarket
Technology Corp. and Todd R. Peters (previously filed as
Exhibit 10.22 to the Company's Annual Report on Form 10-K for
the year ended December 31, 2004 and incorporated herein by this
reference)
|
10.21†
|
Form
of Executive Employment Agreement between Aftermarket Technology
Corp. and
certain of its officers (previously filed as Exhibit 10.27 to the
Company's Annual Report on Form 10-K for the year ended
December 31, 2002 and incorporated herein by this
reference)
|
10.22†
|
Form
of Indemnification Agreement between Aftermarket Technology Corp.
and
directors and certain officers (previously filed as Exhibit 10.46
to
Amendment No. 1 the Company's Registration Statement on Form S-1
(File
No. 333-35543) filed on October 1, 1997 and incorporated herein by
this reference)
|
10.23
|
Stock
Purchase Agreement dated as of September 1, 2000 between Aftermarket
Technology Corp. and ATCDG Acquisition Corp., Inc. (previously
filed as Exhibit 10.1 to the Company's Current Report on
Form 8-K dated October 27, 2000 and incorporated herein by this
reference)
|
10.24
|
Amendment
to Stock Purchase Agreement dated as of October 27, 2000 between
Aftermarket Technology Corp. and ATCDG Acquisition Corp., Inc.
(previously
filed as Exhibit 10.2 to the Company's Current Report on
Form 8-K dated October 27, 2000 and incorporated herein by this
reference)
|
10.25
|
Amendment
No. 2 to Stock Purchase Agreement dated as of May 25, 2001
between Aftermarket Technology Corp. and ATC Distribution Group (as
the
successor to ATCDG Acquisition Corp., Inc.) (previously filed as
Exhibit
10.1 to the Company's Current Report on Form 8-K filed on
December 21, 2001 and incorporated herein by this
reference)
|
10.26
|
Agreement
dated as of July 2, 2001 between Aftermarket Technology Corp. and ATC
Distribution Group (as the successor to ATCDG Acquisition Corp.,
Inc.)
(previously filed as Exhibit 10.2 to the Company's Current Report
on Form
8-K filed on December 21, 2001 and incorporated herein by this
reference)
|
10.27
|
Amendment
No. 3 to Stock Purchase Agreement dated as of October 19, 2001
between Aftermarket Technology Corp. and ATC Distribution Group (as
the
successor to ATCDG Acquisition Corp., Inc.) (previously filed as
Exhibit
10.3 to the Company's Current Report on Form 8-K filed on
December 21, 2001 and incorporated herein by this
reference)
|
10.28
|
Amendment
No. 4 to Stock Purchase Agreement dated as of December 28, 2001
between Aftermarket Technology Corp. and ATC Distribution Group (as
the
successor to ATCDG Acquisition Corp., Inc.)
(previously filed as Exhibit 10.40 to the Company's Annual Report on
Form 10-K for the year ended December 31, 2001 and incorporated
herein by this reference)
|
10.29
|
Amendment
No. 5 to Stock Purchase Agreement dated as of August 2, 2002 between
Aftermarket Technology Corp. and ATC Distribution Group (as the successor
to ATCDG Acquisition Corp., Inc.) (previously
filed as Exhibit 10.29 to the Company's Annual Report on
Form 10-K for the year ended December 31, 2002 and incorporated
herein by this reference)
|
10.30
|
Credit
Agreement dated as of March 21, 2006 among Aftermarket Technology
Corp.,
Bank of America, N.A., as Administrative Agent, and the other Lenders
party thereto, Banc of America Securities LLC, J.P. Morgan Securities
Inc., JPMorgan Chase Bank, N.A., Wells Fargo Bank, N.A. and Charter
One
Bank, N.A. (previously filed as Exhibit 10.1 to the Company’s Quarterly
Report on Form 10-Q for the quarter ended March 31, 2006 and incorporated
herein by reference)
|
10.31
|
Guaranty
and Collateral Agreement dated as of March 21, 2006 made by Aftermarket
Technology Corp. and certain of its subsidiaries in favor of Bank
of
America, N.A., as Administrative Agent (previously filed as Exhibit
10.2
to the Company’s Quarterly Report on Form 10-Q for the quarter ended March
31, 2006 and incorporated herein by reference)
|
14
|
Code
of Ethics (previously filed as Exhibit 14 to the Company's Annual
Report on Form 10-K for the year ended December 31, 2003 and
incorporated herein by this reference)
|
(b)
|
Refer
to (a) 3 above.
|
(c)
|
Refer
to (a) 2 above.
|
AFTERMARKET TECHNOLOGY CORP. | ||
By:
|
/s/
Donald T. Johnson, Jr.
|
|
Donald
T. Johnson, Jr.
Chairman,
President and Chief Executive Officer
|
||
March
1, 2007
|
March
1, 2007
|
/s/
Donald T. Johnson, Jr.
|
|
Donald
T. Johnson, Jr.
Chairman,
President and Chief Executive Officer
(principal
executive officer)
|
||
|
March
1, 2007
|
/s/
Todd R. Peters
|
Todd
R. Peters
Vice
President and Chief Financial Officer
(principal
financial officer)
|
||
|
March
1, 2007
|
/s/
John M. Pinkerton
|
John
M. Pinkerton
Vice
President and Controller
(principal
accounting officer)
|
||
|
March
1, 2007
|
/s/
Robert L. Evans
|
Robert
L. Evans, Director
|
||
|
March
1, 2007
|
/s/
Curtland E. Fields
|
Curtland
E. Fields, Director
|
||
|
March
1, 2007
|
/s/
Michael J. Hartnett
|
Michael
J. Hartnett, Director
|
||
|
March
1, 2007
|
/s/
Michael D. Jordan
|
Michael
D. Jordan, Director
|
||
|
March
1, 2007
|
/s/
S. Lawrence Prendergast
|
S.
Lawrence Prendergast, Director
|
||
March
1, 2007
|
/s/
Edward Stewart
|
|
Edward
Stewart, Director
|
Additions
|
||||||||||||||
Balance
at
Beginning
of
Period
|
Charge
(Income)
to
Costs
and
Expenses
|
Adjustments
to
Other
Accounts
|
Deductions
|
Balance
at
End
of Period
|
||||||||||
Year
ended December 31, 2004:
|
||||||||||||||
Reserve
and allowances deducted from asset accounts:
|
||||||||||||||
Allowance
for uncollectible accounts
|
$
|
365
|
$
|
204
|
$
|
−
|
$
|
95
|
(1)
|
$
|
474
|
|||
Reserve
for excess and obsolete inventory
|
3,421
|
1,859
|
−
|
224
|
5,056
|
|||||||||
Valuation
allowance on deferred tax assets
|
10,086
|
3,795
|
−
|
−
|
13,881
|
|||||||||
Year
ended December 31, 2005:
|
||||||||||||||
Reserve
and allowances deducted from asset accounts:
|
||||||||||||||
Allowance
for uncollectible accounts
|
474
|
334
|
194(2
|
)
|
39
|
(1)
|
963
|
|||||||
Reserve
for excess and obsolete inventory
|
5,056
|
847
|
−
|
826
|
5,077
|
|||||||||
Valuation
allowance on deferred tax assets
|
13,881
|
96
|
−
|
2,218
|
(3)
|
11,759
|
||||||||
Year
ended December 31, 2006:
|
||||||||||||||
Reserve
and allowances deducted from asset accounts:
|
||||||||||||||
Allowance
for uncollectible accounts
|
963
|
(23)
|
|
−
|
69
|
(1)
|
871
|
|||||||
Reserve
for excess and obsolete inventory
|
5,077
|
1,751
|
−
|
1,638
|
5,190
|
|||||||||
Valuation
allowance on deferred tax assets
|
11,759
|
484
|
−
|
−
|
12,243
|
(1)
|
Accounts
written off, net of recoveries.
|
(2)
|
Balance
reclassified in current year.
|
(3)
|
Related
to the expiration of capital loss carryforwards.
|