In addition, as a distributor, we face the risk of key product suppliers changing their relationships with distributors generally, or Applied in particular, in a manner that adversely impacts us. For example, key suppliers could change any of the following: the prices we must pay for their products relative to other distributors or relative to competing products; the geographic or product line breadth of distributor authorizations; supplier purchasing incentive or other support programs; or product purchase or stocking expectations.
The purchasing incentives we earn from product suppliers can be impacted if we reduce our purchases in response to declining customer demand.Certain of our product suppliers have historically offered to their distributors, including us, incentives for purchasing their products. The programs oftenIn addition to market or customer account-specific incentives, certain suppliers pay incentives to the distributor for attaining specific purchase volumes during the program period. In some cases, in order to earn incentives, we must achieve year-over-year growth in purchases with the supplier. When customer demand for our products declines, we may be less willing to add inventory to take advantage of certain incentive programs, thereby potentially adversely impacting our profitability.
Our ability to transact business is highly reliant on our information systems. We face additional risks in this regard as we implement a new integrated information technology platform for our business. We depend on information systems to process customer orders, manage inventory and accounts receivable collections, purchase products, manage accounts payable processes, ship products to customers on a timely basis, maintain cost-effective operations, provide superior service to customers, and accumulate financial results. A serious, prolonged disruption of our information systems or breach in security could materially impair fundamental business processes and increase expenses, decrease sales, or otherwise reduce earnings.
We are in the process of replacing multiple legacy applications with an SAP software platform, to enhance our business information and transaction systems to support future growth. The implementation is occurring over several years in planned phases, primarily based on geographic region; as of June 30, 2013, portions of our
operations in the U.S. and Canada were on SAP. The process is technically intensive, requiring design, testing, modifications, training, and project coordination. Despite extensive planning, we could experience disruptions in our business operations related to the implementation because of the project's complexity. The potential material adverse consequences could include delays, loss of information, diminished management reporting capabilities, damage to our ability to process transactions, harm to our control environment (including during the transition period of operating on two systems), diminished employee productivity, and unanticipated increases in costs. Further, our ability to achieve anticipated operational benefits from the new platform is not assured.
Volatility in product and energy costs can affect our profitability. In recent years,the last decade, cost increases in commodity materials,resources, such as steel and energy, led product manufacturers to increase the prices of products we distribute. In addition, a portion of our own distribution costs is comprised of fuel for our sales and delivery vehicles, freight, and utility expenses for our facilities. All of theseThese costs have fluctuated significantly in recent years. Our ability to pass along to customers the increases in our costs depends on market conditions. Raising our prices could result in decreased sales volume, which could significantly reduce our profitability. When costs fall, market prices can fall too, again potentially affecting profitability.
Future acquisitions are a key component of our anticipated growth. We may not be able to identify or to complete future acquisitions, to integrate them effectively into our operations, or to realize their anticipated benefits.Many industries we serve are mature. As a result, acquisitions of other businesses have been important to our growth in recent years has resulted substantially from the acquisition of other businesses.years. While we wish to continue to acquire businesses, we may not be able to identify and to negotiate suitable acquisitions, to obtain financing for them on satisfactory terms, or otherwise to complete acquisitions. In addition, existing or future competitors may increasingly seek to compete with us for acquisitions, which could have the effect of increasing the price and reducing the number of suitable opportunities.
We seek acquisition opportunities that complement and expand our operations. However, substantial costs, delays, or other difficulties related to integrating acquisitions into our operations could adversely affect our business or financial results. We could face significant challenges in consolidating functions and integrating procedures, information systems, personnel, and operations in a timely and efficient manner.
Further, even if we successfully integrate the acquisitions with our operations, we may not be able to realize the cost savings, sales, increases,profit levels, or other benefits that we anticipate from these acquisitions, either as to amount or in the time frame we expect. Our ability to realize anticipated benefits may be affected by a number of factors, including the following: our ability to achieve planned operating results, to reduce duplicative expenses and inventory effectively, and to consolidate facilities; the incurrence of significant integration costs or charges in order to achieve those benefits; and our ability to retain key product supplier authorizations, customer relationships, and employees. In addition, future acquisitions could place significant demand on administrative, operational, and financial resources.
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Tight credit markets could impact our ability to obtain financing on reasonable terms or increase the cost of future financing.Although the recent credit market turmoil hasof several years ago did not hadhave a significant adverse impact on our liquidity or borrowing costs, the availability of funds has tightened and credit spreads on corporate debt have increased. ObtainingIf credit market volatility were to return, then obtaining additional or replacement financing maycould be more difficult and the cost of issuing new debt or replacing a credit facility would likelycould be higher than under our current facilities. Tight credit conditions could limit our ability to finance acquisitions on terms acceptable to us. For more information relating to borrowing and interest rates, see the following sections of Applied’s 2010Applied's 2013 annual report to shareholders: the “Liquidity and Capital Resources” on pages 7 — 8,section of “Management's Discussion and Analysis,” “Quantitative and Qualitative Disclosures Aboutabout Market Risk” on page 11,Risk,” and notesnote 5 and 6 to the consolidated financial statements on pages 21 — 22.statements.
Our growth outside the United States increases our exposure to global economic and political conditions. Foreign operations contributed 13%18% of our sales in 2010.2013. If we continue to grow outside the U.S., the risks associated with exposure to more volatile economic conditions, political instability, cultural and legal differences in conducting business, and currency fluctuations will increase. In particular, our results are affected by fluctuations in currency exchange rates for the Canadian dollar and the Mexican peso.
Our ability to transact business has become increasingly reliant on our information systems. We depend on information systems to process customer orders, manage inventory and accounts receivable collections, purchase products, ship products to customers on a timely basis, maintain cost-effective operations, and provide superior service to customers. A serious, prolonged disruption
Our business depends on our ability to retainattract, develop, motivate, and to attractretain qualified sales and customer service personnel and other skilled managers and professionals. There are significant costs associated with hiringrecruiting, training, and trainingdeveloping skilled employees. With respect to sales and customer service professionals. Wepositions, we greatly benefit from having employees who are familiar with the products we sell and their applications, as well as with our customer and supplier relationships. We could be adversely affected by a shortage of, or increased competition for, available skilled workers, or by the loss of a significant number of our sales orand customer service personnel or other managers or professionals, including through retirement as the workforce ages.
An interruption of operations at our headquarters or distribution centers could adversely impact our business. Our business depends on maintaining operations at our headquarters and distribution centers. A serious, prolonged interruption due to power outage, telecommunications outage, terrorist attack, earthquake, hurricane,extreme weather events, other natural disasters, fire, flood, or other natural disaster, or other interruption could have a material adverse effect on our business and financial results.
We are subject to litigation and regulatory risk due to the nature of our business, which may have a material adverse effect on our business. From time to time, we are involved in lawsuits or other legal proceedings that arise from business transactions.our business. These may, for example, relate to
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product liability claims, commercial disputes, personal injuries, or employmentemployment-related matters. In addition, we could face claims over other matters, such as claims arising from our status as a government contractor or corporatepublic company, or securities law matters.otherwise relating to our compliance with a wide array of laws and regulations to which we are subject. The defense and ultimate outcome of lawsuits or other legal proceedings or inquiries may result in higher operating expenses, which could have a material adverse effect on our business, financial condition, or results of operations.
In addition to the risks identified above, other risks to our future performance include, but are not limited to, the following:
changes in customer preferences for products and services of the nature, brands, quality, or cost sold by Applied;
changes in customer procurement policies and practices;
changes in the market prices for products and services relative to the costs of providing them;
changes in operating expenses;
organizational changes within the company;
adverse regulation and legislation, both enacted and under consideration, including with respect to health care and federal tax policy (e.g., affecting the use of the LIFO inventory accounting method and the taxation of foreign-sourced income);
the variability and timing of new business opportunities including acquisitions, alliances, customer relationships, and supplier authorizations;
the incurrence of debt and contingent liabilities in connection with acquisitions;
volatility of our stock price and the resulting impact on our consolidated financial statements; and
changes in accounting policies and practices that could impact our financial reporting and increase compliance costs; and
costs.instability in the U.S., Canadian, or Mexican banking systems, which could affect our access to, or result in loss of, cash deposits at commercial banks or investments in money market funds.
ITEM 1B.UNRESOLVED STAFF COMMENTS.
Not applicable.
ITEM 2.PROPERTIES.
We believe having a local presence is important to serving our customers, so we maintain service centers and other operations in local markets throughout North America.the countries in which we operate. At June 30, 2010,2013, we owned real properties at 135126 locations and leased 298361 locations. Certain properties house more than one operation.
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The following were our principal owned real properties (each of which has more than 30,000 square feet of floor space) at June 30, 2010:2013.
| | |
| |
Location of Principal Owned | | |
Real Property | | Type of Facility |
Atlanta, Georgia | | Distribution center and service center |
Florence, Kentucky | | Distribution center |
Carlisle, Pennsylvania | | Distribution center |
Fort Worth, Texas | | Distribution center and rubber shop |
Our principal leased real properties (each of which has more than 30,000 square feet of floor space) at June 30, 20102013 were:
| | |
| |
Location of Principal Leased | | |
Real Property | | Type of Facility |
Cleveland, Ohio | | Corporate headquarters |
Fontana, California | | Distribution center, rubber shop, fluid power shop and service center |
Newark, California | | Fluid power shop |
Denver, Colorado | | Rubber shop and service center |
Lenexa, Kansas | | Fluid power shop |
Chanhassen, Minnesota | | Fluid power shop |
Billings, Montana | | Fluid power shop |
Cleveland, Ohio (two locations) | Offices and warehouse |
Elyria, Ohio | | Product return center and service center |
Portland, Oregon | | Distribution center |
Kent, Washington | | Offices, and fluid power shop, and service center |
Longview, Washington | | Service center, rubber shop and fluid power shop |
Appleton, Wisconsin | | Offices, service center, and rubber shop |
Edmonton, Alberta | Service center and shop |
Winnipeg, Manitoba | | Distribution center and service center |
The properties in Newark, Lenexa, Chanhassen, Billings, and KentBillings are used in our fluid power businesses segment. The Fontana, Kent, and Longview properties are used in operations both in the service center-based distribution segment and the fluid power businesses segment. The remaining properties are used in the service center-based distribution segment.
We consider our properties generally sufficient to meet our requirements for office space and inventory stocking. A service center’scenter's size is primarily influenced by the amount and types of inventory the service center requires to meet customers’customers' needs.
In recent years, when opening new operations, we have tended to lease rather than purchase real property. We use all of our owned and leased properties except fordo not consider any service center, distribution center, or shop property to be material, because we believe that, if it becomes necessary or desirable to relocate an operation, other suitable property could be found.
In addition to operating locations, we own or lease certain properties which in the aggregate are not material and are either for sale, lease, or sublease to third parties due to a relocation or closing. We also may lease or sublease to others unused portions of buildings.
In recent years, when opening new operations, we have tended to lease rather than purchase real property. We do not consider any of our service center, distribution center, or shop properties to
15
be material, because we believe that, if it becomes necessary or desirable to relocate an operation, other suitable property could be found.
Additional information regarding our properties is included in the 20102013 annual report to shareholders in note 11 to the consolidated financial statements on page 31.statements. That information is incorporated here by reference.
ITEM 3.LEGAL PROCEEDINGS.
Applied and/or one of its subsidiaries is a party to pending legal proceedings with respect to product liability, commercial, personal injury, and other matters. Although it is not possible to predict the outcome of these proceedings or the range of reasonably possible loss, we believe, based on circumstances currently known, that the likelihood is remote that the ultimate resolution of any of these proceedings will have, either individually or in the aggregate, a material adverse effect on Applied’sApplied's consolidated financial position, results of operations, or cash flows.
ITEM 4.MINE SAFETY DISCLOSURES.
Reserved.Not applicable.
EXECUTIVE OFFICERS OF THE REGISTRANT.
Applied’s
Applied's executive officers are elected by the Board of Directors for a term of one year, or until their successors are chosen and qualified, at the Board’sBoard's organizational meeting held following the annual meeting of shareholders. The following is a list of the executive officers and a description of their business experience during the past five years. Except as otherwise stated, the positions and offices indicated are with Applied, and the persons were elected to their current positions on October 20, 2009:23, 2012:
|
| | | | | | |
Name | | Positions and Experience | | Age |
David L. PughNeil A. Schrimsher | | Chairman &President (since August 2013) and Chief Executive Officer and a member of Board of Directors | | | 61 | |
| | | | | | |
Benjamin J. Mondics | | President & Chief Operating Officer (since January 2008); previously served asOctober 2011). From February 2010 to August 2011, Mr. Schrimsher was Executive Vice President & Chief Operating Officer (from February 2007 —of Cooper Industries plc (formerly NYSE: CBE), a global electrical products manufacturer, where he led Cooper's Electrical Products Group and headed numerous domestic and international growth initiatives. He was also President of Cooper Lighting, Inc. throughout the period from 2006 to December 2007) and Vice President-Midwest Area (prior to February 2007)2010. | | | 52 | |
| | | | | | 49 |
Thomas E. Armold | | Vice President-Marketing and Strategic Accounts (since January 2008); previously served as Vice President-Product Management and Marketing | | | 55 | |
| | | | | | 58 |
Todd A. Barlett | | Vice President-Acquisitions and Global Business Development | | | 55 | |
| | | | | | 58 |
Fred D. Bauer | | Vice President-General Counsel & Secretary | | | 44 | |
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| | | | | | |
Name | | Positions and Experience | | Age |
Michael L. Coticchia | | Vice President-Chief Administrative Officer and Government Business (since July 2006); previously served as Vice President-Human Resources and Administration | | | 47 | |
| | | | | | |
Mark O. Eisele | | Vice President-Chief Financial Officer & Treasurer | | | 53 | 56 |
Carl E. Will | | | | | | |
Jeffrey A. Ramras | | Vice President-Supply Chain Management (sinceChief Commercial Officer since July 2013. From 2004 to January 2008); previously2013, he served as an executive with Invacare Corporation (NYSE: IVC), which engages in the design, manufacture, and distribution of medical equipment and supplies worldwide. Most recently, he was Invacare's Senior Vice President-MarketingPresident-Global Commercial Operations from November 2010 to January 2013 and Supply Chain Managementits Senior Vice President-North American Homecare from 2008 to November 2010. | | | 55 | |
| | | | | | |
Richard C. Shaw | | Vice President-Communications and Learning | | | 61 | 43 |
Benjamin J. Mondics, formerly President & Chief Operating Officer, retired from Applied on August 16, 2013. Michael L. Coticchia, Vice President-Chief Human Resources Officer, resigned on July 1, 2013.
PART II.
ITEM 5.MARKET FOR REGISTRANT’SREGISTRANT'S COMMON EQUITY, RELATED
STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
Applied’s
Applied's common stock, without par value, is listed for trading on the New York Stock Exchange with the ticker symbol “AIT.” Information concerning the principal market for Applied’sApplied's common stock, the quarterly stock prices and dividends for the fiscal years ended June 30, 2010, 2009,2013, 2012, and 20082011 and the number of shareholders of record as of August 6, 201015, 2013 is set forth in the 20102013 annual report to shareholders, on page 37, under the captioncaptions “Quarterly Operating ResultsResults” and Market Data,“Quarterly Volume and Price Information,” and that information is incorporated here by reference.
The following table summarizes Applied’sApplied's repurchases of its common stock in the quarter ended June 30, 2010.2013.
| | | | | | | | | | | | | | | | |
| | | | | | | | | | (c) Total Number of | | | (d) Maximum Number | |
| | | | | | | | | | Shares Purchased as | | | of Shares that May | |
| | | | | | | | | | Part of Publicly | | | Yet Be Purchased | |
| | (a) Total Number of | | | (b) Average Price | | | Announced Plans or | | | Under the Plans or | |
Period | | Shares (1) | | | Paid per Share ($) | | | Programs | | | Programs (2) | |
April 1, 2010 to April 30, 2010 | | | 1,000 | | | | 30.82 | | | | 1,000 | | | | 879,100 | |
May 1, 2010 to May 31, 2010 | | | 20,000 | | | | 28.62 | | | | 20,000 | | | | 859,100 | |
June 1, 2010 to June 30, 2010 | | | 21,900 | | | | 26.84 | | | | 21,900 | | | | 837,200 | |
Total | | | 42,900 | | | | 27.76 | | | | 42,900 | | | | 837,200 | |
|
| | | | |
Period | (a) Total Number of Shares (1) | (b) Average Price Paid per Share ($) | (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | (d) Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (2) |
April 1, 2013 to April 30, 2013 | 1,300 | 40.96 | 1,300 | 1,141,500 |
May 1, 2013 to May 31, 2013 | — | — | — | 1,141,500 |
June 1, 2013 to June 30, 2013 | — | — | — | 1,141,500 |
Total | 1,300 | 40.96 | 1,300 | 1,141,500 |
| | |
(1) | | During the quarter ended June 30, 2010,2013, Applied purchased 25317 shares in connection with an employee deferred compensation program. This purchase is not counted in the Board of Directors authorization in note (2). |
| |
(2) | | On January 23, 2008,October 25, 2011, the Board of Directors authorized the purchase of up to 1.5 million shares of Applied’sApplied's common stock. We publicly announced the authorization that day. Purchases maycan be made in the open market or in privately negotiated transactions. ThisThe authorization is in effect until all shares are purchased, or the Board revokes or amends the authorization. |
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ITEM 6.SELECTED FINANCIAL DATA.
The summary of selected financial data for the last five years is set forth in the 2010 annual reportExhibit 13 to shareholders in the table on pages 38 — 39this Form 10-K under the caption “10“5 Year Summary.” That information is incorporated here by reference.
ITEM 7.MANAGEMENT’SMANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
“Management’s
“Management's Discussion and Analysis” is set forth in the 20102013 annual report to shareholders on pages 5 — 11 and is incorporated here by reference.
ITEM 7A.QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK.
The disclosures about market risk required by this item are set forth in Applied’s 2010Applied's 2013 annual report to shareholders, on page 11, which information is incorporated here by reference. For more information relating to borrowing and interest rates, see the “Liquidity and Capital Resources” section of “Management’s“Management's Discussion and Analysis” and notesnote 5 and 6 to the consolidated financial statements in Applied’s 2010Applied's 2013 annual report to shareholders on pages 7 — 8, and 21 — 22.shareholders. That information is also incorporated here by reference. In addition, see “Risk Factors” at pages 10 - 14,Factors,” above, for additional risk factors relating to our business.
ITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The following consolidated financial statements and supplementary data of Applied and its subsidiaries and the reports of the independent registered public accounting firm listed below, which are included in the 20102013 annual report to shareholders at the pages indicated, are incorporated here by reference and filed with this report:
| | |
Caption | | | |
| Page No. |
Financial Statements: | | |
Ÿ | | |
Statements of Consolidated Income | | 12 |
for the Years Ended June 30, 2010, 2009,2013, 2012, and 20082011 | | 14 |
Ÿ | Statements of Consolidated Comprehensive Income for the Years Ended June 30, 2013, 2012, and 2011 | |
18
| | 15 |
CaptionŸ | | Page No. |
Consolidated Balance Sheets at June 30, 20102013 and 20092012 | | 1316 |
Ÿ | | |
Statements of Consolidated Cash Flows for the Years Ended June 30, 2010, 2009,2013, 2012, and 20082011 | | 1417 |
Ÿ | | |
Statements of Consolidated Shareholders’Shareholders' Equity forFor the Years Ended June 30, 2010, 2009,2013, 2012, and 20082011 | | 1518 |
Ÿ | | |
Notes to Consolidated Financial Statements for the Years Ended June 30, 2010, 2009,2013, 2012, and 20082011 | | 16 — 33 |
| | 19-37 |
Reports of Independent Registered Public Accounting Firm | | 34, 36 |
| | 38, 40 |
Supplementary Data: | | |
Ÿ | | |
Quarterly Operating Results & Market Data | | 3741 |
ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE.
Not applicable.None.
ITEM 9A.CONTROLS AND PROCEDURES.
Applied’s
Applied's management, under the supervision and with the participation of the chief executive officer (CEO) and the chief financial officer (CFO), has evaluated the effectiveness of Applied’sthe company's disclosure controls and procedures, as defined in Exchange Act Rule 13a-15(e) of the Exchange Act,, as of the end of the period covered by this report. Based on that evaluation, management has concluded that the Company's disclosure controls and procedures are effective.
Management’s annual report on Applied’s
Applied has undertaken a multi-year project to transform our technology platforms and enhance our business information and transaction systems with SAP enterprise resource planning software. We have begun to implement SAP in parts of our Canadian and U.S. businesses to support both operating and accounting activities. The implementation at operating locations is expected to continue through fiscal year 2014. Changes in Applied's key business applications and financial processes as a result of the continuing implementation of SAP are being
evaluated by management. We are designing processes and internal controls to address changes in internal control over financial reporting and the attestation reportas a result of the independent registered public accounting firm are set forth in the 2010 annual reportSAP implementation. This ongoing implementation presents transitional risks to shareholders on pages 35 — 36 and are incorporated here by reference.maintaining adequate internal controls over financial reporting.
Management
Other than as described above, management has not identified anya change in internal control over financial reporting occurring during the fourth quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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Management's annual report on Applied's internal control over financial reporting and the attestation report of the independent registered public accounting firm are set forth in the 2013 annual report to shareholders and are incorporated here by reference.
ITEM 9B.OTHER INFORMATION.
Not applicable.
Applied's Board of Directors elected Neil A. Schrimsher, Chief Executive Officer, to the additional office of President, effective upon the retirement of Benjamin J. Mondics on August 16, 2013.
PART III.
ITEM 10.DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
The information required by this Item as to Applied’sApplied's directors is incorporated by reference to Applied’sApplied's proxy statement relating to the annual meeting of shareholders to be held October 26, 2010,29, 2013, under the caption “Item 1 —- Election of Directors.” The information required by this Item as to Applied’sApplied's executive officers has been furnished in this Report on pages 16 — 17report in Part I, after Item 4, under the caption “Executive Officers of the Registrant.”
The information required by this Item regarding compliance with Section 16(a) of the Securities Exchange Act of 1934 is incorporated by reference to Applied’sApplied's proxy statement, under the caption “Section 16(a) Beneficial Ownership Reporting Compliance.”
Applied has a code of ethics, named the Code of Business Ethics, that applies to our employees, including our chief executive officer, chief operating officer, chief financial officer, and corporate controller. The Code of Business Ethics is posted via hyperlink at the investor relations area of ourwww.applied.comwebsite. In addition, amendments to and waivers from the Code of Business Ethics will be disclosed promptly at the same location.
Information regarding the composition of Applied’sApplied's audit committee and the identification of audit committee financial expert(s)experts serving on the audit committee is incorporated by reference to Applied’sApplied's proxy statement, under the caption “Corporate Governance.”
ITEM 11.EXECUTIVE COMPENSATION.
The information required by this Item is incorporated by reference to Applied’sApplied's proxy statement for the annual meeting of shareholders to be held October 26, 2010,29, 2013, under the captions “Executive Compensation” and “Compensation Committee Report.”
ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
Applied’s
Applied's shareholders have approved the following equity compensation plans: the 1997 Long-Term Performance Plan, the 2007 Long-Term Performance Plan, the 2011 Long-Term Performance Plan, the Deferred Compensation Plan, and the Deferred Compensation Plan for Non-Employee Directors. All of these plans are currently in effect.
20
The following table shows information regarding the number of shares of Applied common stock that may be issued pursuant to equity compensation plans or arrangements of Applied as of June 30, 2010.
| | | | | | | | | | | | |
| | Number of | | | Weighted- | | | | |
| | Securities | | | Average | | | | |
| | to be | | | Exercise | | | Number of | |
| | Issued upon | | | Price of | | | Securities | |
| | Exercise of | | | Outstanding | | | Remaining | |
| | Outstanding | | | Options, | | | Available for Future | |
| | Options, | | | Warrants | | | Issuance Under | |
| | Warrants and | | | and | | | Equity | |
Plan Category | | Rights | | | Rights | | | Compensation Plans | |
Equity compensation plans approved by security holders | | | 2,399,656 | | | $ | 18.19 | | | | * | |
Equity compensation plans not approved by security holders | | | 0 | | | | — | | | | 0 | |
Total | | | 2,399,656 | | | $ | 18.19 | | | | * | |
2013. |
| | | | | | |
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 Issuance Under Equity Compensation Plans |
Equity compensation plans approved by security holders | | 1,080,260 | | $28.79 | | * |
Equity compensation plans not approved by security holders | | 0 | | — | | 0 |
Total |
| 1,080,260 |
| $28.79 | | * |
| | |
* | | The 20072011 Long-Term Performance Plan was adopted to replace the 2007 Long-Term Performance Plan, and the 2007 Long-Term Performance Plan replaced the 1997 Long-Term Performance Plan, under which previously awarded stockPlan. Stock options and stock appreciation rights remain outstanding.outstanding under each of the 1997 and 2007 plans, but no new awards are made under those plans. The aggregate number of shares that remained available for awards under the 20072011 Long-Term Performance Plan at June 30, 2010,2013, was 995,610.1,647,794. The number of shares issuable under the Deferred Compensation Plan for Non-Employee Directors and the Deferred Compensation Plan depends on the dollar amount of participant contributions deemed invested in Applied common stock. |
Information concerning the security ownership of certain beneficial owners and management is incorporated by reference to Applied’sApplied's proxy statement for the annual meeting of shareholders to be held October 26, 2010,29, 2013, under the caption “Beneficial Ownership“Holdings of Certain AppliedMajor Shareholders, Officers, and Management.Directors.”
ITEM 13.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS,
AND DIRECTOR INDEPENDENCE.
The information required by this Item is incorporated by reference to Applied’sApplied's proxy statement for the annual meeting of shareholders to be held October 26, 2010,29, 2013, under the caption “Corporate Governance.”
ITEM 14.PRINCIPAL ACCOUNTANT FEES AND SERVICES.
The information required by this Item is incorporated by reference to Applied’sApplied's proxy statement for the annual meeting of shareholders to be held October 26, 2010,29, 2013, under the caption “Item 2 –3 - Ratification of Auditors.”
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PART IV.
ITEM 15.EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a)1.Financial Statements.
The following consolidated financial statements, notes thereto, the reports of independent registered public accounting firm, and supplemental data are included in the 20102013 annual report to shareholders, on pages 12 – 34 and 36 – 37, and are incorporated by reference in Item 8 of this report.report:
| | | | | | |
| | Caption | | | | |
| Ÿ | Statements of Consolidated Income for the Years Ended June 30, 2010, 2009,2013, 2012, and 20082011 |
| | |
Ÿ | | Statements of Consolidated Balance SheetsComprehensive Income for the Years Ended June 30, 20102013, 2012, and 20092011 |
| | |
Ÿ | Consolidated Balance Sheets at June 30, 2013 and 2012 |
| | |
Ÿ | Statements of Consolidated Cash Flows for the Years Ended June 30, 2010, 2009,2013, 2012, and 20082011 |
| | |
| Ÿ | Statements of Consolidated Shareholders’Shareholders' Equity forFor the Years Ended June 30, 2010, 2009,2013, 2012, and 20082011 |
| | |
| Ÿ | Notes to Consolidated Financial Statements for the Years Ended June 30, 2010, 2009,2013, 2012, and 20082011 |
| | |
| Ÿ | Reports of Independent Registered Public Accounting Firm |
| | |
| Ÿ | Supplementary Data: |
| | |
| Ÿ | Quarterly Operating Results & Market Data |
(a)2.Financial Statement Schedule.
The following report and schedule are included in this Part IV, and are found in this report at the pages indicated:
|
| | | | | | |
| | Caption | | Page No. |
| | |
Ÿ | Report of Independent Registered Public Accounting Firm | | | 29 | 22 |
| | |
Ÿ | Schedule II —- Valuation and Qualifying Accounts | | | 30 | 23 |
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All other schedules for which provision is made in the applicable accounting regulation of the Securities and Exchange Commission have been omitted because they are not required under the related instructions, are not applicable, or the required information is included in the consolidated financial statements and notes thereto.
(a)3.Exhibits.
|
| |
* | | Asterisk indicates an executive compensation plan or arrangement. |
Exhibit No. | Description |
| |
Exhibit | | |
No. | | Description |
3.1 | | Amended and Restated Articles of Incorporation of Applied Industrial Technologies, Inc., as amended on October 25, 2005 (filed as Exhibit 3(a) to Applied’sApplied's Form 10-Q for the quarter ended December 31, 2005, SEC File No. 1-2299, and incorporated here by reference). |
| | |
3.2 | | Code of Regulations of Applied Industrial Technologies, Inc., as amended on October 19, 1999 (filed as Exhibit 3(b) to Applied’sApplied's Form 10-Q for the quarter ended September 30, 1999, SEC File No. 1-2299, and incorporated here by reference). |
| |
|
| |
4.1 | | Certificate of Merger of Bearings, Inc. (Ohio) and Bearings, Inc. (Delaware) filed with the Ohio Secretary of State on October 18, 1988, including an Agreement and Plan of Reorganization dated September 6, 1988 (filed as Exhibit 4(a) to Applied’sApplied's Registration Statement on Form S-4 filed May 23, 1997, Registration No. 333-27801, and incorporated here by reference). |
| | |
4.2 | | Private Shelf Agreement dated as of November 27, 1996, as most recently amended on February 4, 2013, between Applied and Prudential Investment Management, Inc. (assignee of The Prudential Insurance Company of America), conformed to show all amendments (filed as Exhibit 4.24.3 to Applied’sApplied's Form 10-Q for the quarter ended March 31, 2010,2013, SEC File No. 1-2299, and incorporated here by reference). |
| | |
4.3 | | Credit Agreement dated as of June 3, 2005,May 15, 2012, among Applied Industrial Technologies, Inc., KeyBank National Association as Agent, and various financial institutions (filed as Exhibit 4.7 to Applied’s Form 10-Q for the quarter ended December 31, 2009, SEC File No. 1-2299, and incorporated here by reference). |
23
| | |
Exhibit | | |
No. | | Description |
4.4 | | First Amendment Agreement dated as of June 6, 2007, among Applied, KeyBank National Association as Agent, and various financial institutions, amending June 3, 2005 Credit Agreement (filed as Exhibit 4 to Applied’sApplied's Form 8-K dated June 11, 2007,May 17, 2012, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.1 | | Form of Change in Control Agreement between Applied and each of its executive officers (filed as Exhibit 99.1 to Applied’s Form 8-K dated April 25, 2008, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.2 | | A written description of Applied’sApplied's director compensation program is incorporated by reference to Applied’sApplied's proxy statement for the annual meeting of shareholders to be held October 26, 201029, 2013 under the caption “Director Compensation.” |
| | |
*10.3 | 10.2 | Deferred Compensation Plan for Non-Employee Directors (September 1, 2003 Restatement), the terms of which govern benefits vested as of December 31, 2004, for certain directors (filed as Exhibit 10(c) to Applied’sApplied's Form 10-K for the year ended June 30, 2003, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.4 | 10.3 | Deferred Compensation Plan for Non-Employee Directors (Post-2004 Terms) (filed as Exhibit 10.2 to Applied’sApplied's Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.5 | | A written description of Applied’s Life and Accidental Death and Dismemberment Insurance for executive officers (filed as Exhibit 10(d) to Applied’s Form 10-K for the year ended June 30, 2007, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.6 | | A written description of Applied’s Long-Term Disability Insurance for executive officers (filed as Exhibit 10(c) to Applied’s Form 10-Q for the quarter ended December 31, 1997, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.7 | 10.4 | Form of Director and Officer Indemnification Agreement entered into between Applied and each of its directors and executive officers (filed as Exhibit 10(g) to Applied’sApplied's Registration Statement on Form S-4 filed May 23, 1997, Registration No. 333-27801, and incorporated here by reference). |
| | |
*10.810.5 | | Supplemental Executive Retirement Benefits Plan (January 1, 2002 Restatement), the termsA written description of which govern benefits vested as of December 31, 2004,Applied's Life and Accidental Death and Dismemberment Insurance for one executive officer, R. C. Shawofficers (filed as Exhibit 1010(d) to Applied’sApplied's Form 10-Q10-K for the quarteryear ended March 31, 2002, SEC File No. 1-2299, and incorporated here by reference). |
24
| | |
Exhibit | | |
No. | | Description |
*10.9 | | First Amendment to Supplemental Executive Retirement Benefits Plan (January 1, 2002 Restatement) (filed as Exhibit 10 to Applied’s Form 10-Q for the quarter ended SeptemberJune 30, 2004,2007, SEC File No. 1-2299, and incorporated here by reference). |
| |
*10.6 | A written description of Applied's Long-Term Disability Insurance for executive officers (filed as Exhibit 10(c) to Applied's Form 10-Q for the quarter ended December 31, 1997, SEC File No. 1-2299, and incorporated here by reference). |
| |
*10.1010.7 | Form of Change in Control Agreement between Applied and each of its executive officers, except for Neil A. Schrimsher and Carl E. Will (filed as Exhibit 99.1 to Applied's Form 8-K dated April 25, 2008, SEC File No. 1-2299, and incorporated here by reference). |
| |
*10.8 | Key Executive Restoration Plan, as amended and restated, for Applied's executive officers and list of participants (filed as Exhibit 10.1 to Applied's Form 8-K dated August 16, 2013, SEC File No. 1-2299, and incorporated here by reference). |
| |
*10.9 | Supplemental Executive Retirement Benefits Plan (Restated Post-2004 Terms) in which the executive officers, except for Neil A. Schrimsher and Carl E. Will, participate (filed as Exhibit 10.1 to Applied’sApplied's Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). |
| |
*10.10 | First Amendment to the Applied Industrial Technologies, Inc. Supplemental Executive Retirement Benefits Plan (Restated Post-2004 Terms) (filed as Exhibit 10.1 to Applied's Form 8-K dated December 22, 2011, SEC File No. 1-2299, and incorporated here by reference). |
*10.11 | Second Amendment to the Applied Industrial Technologies, Inc. Supplemental Executive Retirement Benefits Plan (Restated Post-2004 Terms) (filed as Exhibit 10.1 to the Company's Form 8-K dated October 22, 2012, SEC File No. 1-2299, and incorporated here by reference). |
| |
|
| |
*10.12 | Deferred Compensation Plan (September 1, 2003 Restatement), the terms of which govern benefits vested as of December 31, 2004, for certain executive officersMark O. Eisele (filed as Exhibit 10(h) to Applied’sApplied's Form 10-K for the year ended June 30, 2003, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.12 | 10.13 | First Amendment to Deferred Compensation Plan (September 1, 2003 Restatement) (filed as Exhibit 10 to Applied’sApplied's Form 10-Q for the quarter ended December 31, 2003, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.13 | 10.14 | Deferred Compensation Plan (Post-2004 Terms) (filed as Exhibit 10.3 to Applied’sApplied's Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.14 | 10.15 | 1997 Long-Term Performance Plan, as amended April 19, 2007 (filed as Exhibit 10(k) to Applied’sApplied's Form 10-K for the year ended June 30, 2007, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.15 | 10.16 | Section 409A Amendment to the 1997 Long-Term Performance Plan (filed as Exhibit 10.4 to Applied’sApplied's Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.16 | 10.17 | 2007 Long-Term Performance Plan (filed as Exhibit 10 to Applied’sApplied's Form 8-K dated October 23, 2007, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.17 | 10.18 | Section 409A Amendment to the 2007 Long-Term Performance Plan (filed as Exhibit 10.5 to Applied’sApplied's Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). |
25
| | |
Exhibit*10.19 | 2011 Long-Term Performance Plan (filed as Appendix to Applied's proxy statement for the annual meeting of shareholders held on October 25, 2011, SEC File No. 1-2299, and incorporated here by reference). |
| |
No. | | Description |
*10.18 | 10.20 | Supplemental Defined Contribution Plan (January 1, 1997 Restatement) the terms of which govern benefits vested as of December 31, 2004, for certain executive officers (filed as Exhibit 10(m) to Applied’sApplied's Registration Statement on Form S-4 filed May 23, 1997, Registration No. 333-27801, and incorporated here by reference). |
| | |
*10.19 | 10.21 | First Amendment to Supplemental Defined Contribution Plan effective as of October 1, 2000 (filed as Exhibit 10(a) to Applied’sApplied's Form 10-Q for the quarter ended September 30, 2000, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.20 | 10.22 | Second Amendment to Supplemental Defined Contribution Plan effective as of January 16, 2001 (filed as Exhibit 10(a) to Applied’sApplied's Form 10-Q for the quarter ended March 31, 2001, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.21 | 10.23 | Supplemental Defined Contribution Plan (Post-2004 Terms) (filed as Exhibit 10.6 to Applied’sApplied's Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.22 | 10.24 | Non-Statutory Stock Option Award Terms and Conditions (Directors) (filed as Exhibit 10 to Applied’sApplied's Form 8-K dated November 30, 2005, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.23 | 10.25 | Restricted Stock Award Terms and Conditions (Directors) (filed as Exhibit 10(b)10.1 to Applied’sApplied's Form 10-Q for the quarter ended March 31, 2007,2012, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.24 | 10.26 | Stock Appreciation Rights Award Terms and Conditions (Officers) (August 2011 revision) (filed as Exhibit 10.02 to Applied’sApplied's Form 8-K dated September 16, 2009,August 9, 2012, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.25 | 10.27 | Performance GrantShares Terms and Conditions (filed as Exhibit 10.310.04 to Applied’sApplied's Form 10-Q for the quarter ended September 30, 2008,8-K dated August 9, 2012, SEC File No. 1-2299, and incorporated here by reference). |
| | |
*10.26 | | Performance Shares Terms and Conditions (filed as Exhibit 10.04 to Applied’s Form 8-K dated September 16, 2009, SEC File No. 1-2299, and incorporated here by reference). |
26
| | |
Exhibit | | |
No. | | Description |
*10.27 | 10.28 | Restricted Stock Units Terms and Conditions (filed as Exhibit 10.03 to Applied’sApplied's Form 8-K dated September 16, 2009,August 9, 2012, SEC File No. 1-2299, and incorporated here by reference). |
|
| |
| |
*10.29 | Management Incentive Plan General Terms (filed as Exhibit 10.01 to Applied's Form 8-K dated August 9, 2012, SEC File No. 1-2299, and incorporated here by reference). |
| |
| |
*10.2810.30 | | Management Incentive Plan General TermsOffer of Employment for Neil A. Schrimsher (filed as Exhibit 10.0110.1 to Applied’sApplied's Form 8-K dated September 16, 2009,October 17, 2011, SEC File No. 1-2299, and incorporated here by reference). |
| |
*10.31 | Severance Agreement for Neil A. Schrimsher (filed as Exhibit 10.2 to Applied's Form 8-K dated October 31, 2011, SEC File No. 1-2299, and incorporated here by reference). |
*10.32 | Amendment to Severance Agreement for Neil A. Schrimsher (filed as Exhibit 10.2 to Applied's Form 8-K dated October 22, 2012, SEC File No. 1-2299, and incorporated here by reference). |
*10.33 | Change in Control Agreement for Neil A. Schrimsher (filed as Exhibit 10.3 to Applied's Form 8-K dated October 31, 2011, SEC File No. 1-2299, and incorporated here by reference). |
| |
*10.2910.34 | Terms and Conditions for Inducement Restricted Units Award for Neil A. Schrimsher (filed as Exhibit 10.4 to Applied's Form 8-K dated October 31, 2011, SEC File No. 1-2299, and incorporated here by reference). |
| |
*10.35 | Terms and Conditions for Inducement Stock Appreciation Rights Award for Neil A. Schrimsher (filed as Exhibit 10.5 to Applied's Form 8-K dated October 31, 2011, SEC File No. 1-2299, and incorporated here by reference). |
| |
*10.36 | Non-qualified Deferred Compensation Agreement between Applied and J. Michael Moore effective as of December 31, 1997 (filed as Exhibit 10(a) to Applied’sApplied's Form 10-Q for the quarter ended March 31, 1998, SEC File No. 1-2299, and incorporated here by reference). |
*10.37 | Executive Retirement Agreement between Applied and Benjamin J. Mondics. |
| |
10.30 | 10.38 | Lease dated as of March 1, 1996 between Applied and the Cleveland-Cuyahoga County Port Authority (filed as Exhibit 10(n) to Applied’sApplied's Registration Statement on Form S-4 filed May 23, 1997, Registration No. 333-27801, and incorporated here by reference). |
| | |
10.31 | | Asset Purchase Agreement made as of July 14, 2008, among Applied, Fluid Power Resource, LLC (“FPR”), and certain FPR subsidiaries (filed as Exhibit 2.1 to Applied’s Form 8-K dated July 16, 2008, SEC File No. 1-2299, and incorporated here by reference). |
| | |
13 | | Applied’s 2010Applied's 2013 annual report to shareholders (not deemed “filed” as part of this Form 10-K except for those portions that are expressly incorporated by reference). |
| | |
21 | | Applied’sApplied's subsidiaries at June 30, 2010.2013. |
| | |
23 | | Consent of Independent Registered Public Accounting Firm. |
| | |
24 | | Powers of attorney. |
| | |
31 | | Rule 13a-14(a)/15d-14(a) certifications. |
| | |
32 | | Section 1350 certifications. |
| |
101.INS | XBRL Instance Document |
| |
101.SCH | XBRL Taxonomy Extension Schema Document |
| |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
| |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
| |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
| |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
| |
Applied will furnish a copy of any exhibit described above and not contained herein upon payment of a specified reasonable fee, which shall be limited to Applied’sApplied's reasonable expenses in furnishing the exhibit.
Certain long-term debt instruments have not been filed as exhibits because the total amount
assets of Applied and its subsidiaries on a consolidated basis. Applied agrees to furnish to the Securities and Exchange Commission, upon request, a copy of each such instrument.
28
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders of
Applied Industrial Technologies, Inc.
Cleveland, Ohio
We have audited the consolidated financial statements of Applied Industrial Technologies, Inc. and subsidiaries (the “Company”"Company") as of June 30, 20102013 and 2009,2012, and for each of the three years in the period ended June 30, 2010,2013, and the Company’sCompany's internal control over financial reporting as of June 30, 2010,2013, and have issued our reports thereon dated August 13, 2010;20, 2013; such consolidated financial statements and reports are included in your 20102013 Annual Report to Shareholders and are incorporated herein by reference. Our audits also included the consolidated financial statement schedule of the Company listed in Item 15.15(a)2. This consolidated financial statement schedule is the responsibility of the Company’sCompany's management. Our responsibility is to express an opinion based on our audits. In our opinion, such consolidated financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.
/s/ Deloitte & Touche LLP
Cleveland, Ohio
August 13, 201020, 2013
29
APPLIED INDUSTRIAL TECHNOLOGIES, INC. & SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
YEARS ENDED JUNE 30, 2010, 20092013, 2012 AND 20082011
(in thousands)
| | | | | | | | | | | | | | | | | | | | |
COLUMN A | | COLUMN B | | | COLUMN C | | | COLUMN D | | | COLUMN E | |
| | | | | | | | | | ADDITIONS | | | | | | | |
| | | | | | ADDITIONS | | | (DEDUCTIONS) | | | | | | | |
| | BALANCE AT | | | CHARGED TO | | | CHARGED TO | | | DEDUCTIONS | | | BALANCE | |
| | BEGINNING | | | COSTS AND | | | OTHER | | | FROM | | | AT END OF | |
DESCRIPTION | | OF PERIOD | | | EXPENSES | | | ACCOUNTS | | | RESERVE | | | PERIOD | |
|
YEAR ENDED JUNE 30, 2010: | | | | | | | | | | | | | | | | | | | | |
Reserve deducted from assets to which it applies — accounts receivable allowances | | $ | 6,464 | | | $ | 2,508 | | | | ($95) | (B) | | $ | 2,498 | (A) | | $ | 6,379 | |
| | | | | | | | | | | | | | | | | | | | |
YEAR ENDED JUNE 30, 2009: | | | | | | | | | | | | | | | | | | | | |
Reserve deducted from assets to which it applies — accounts receivable allowances | | $ | 6,119 | | | $ | 4,540 | | | $ | 18 | (B) | | $ | 4,213 | (A) | | $ | 6,464 | |
| | | | | | | | | | | | | | | | | | | | |
YEAR ENDED JUNE 30, 2008: | | | | | | | | | | | | | | | | | | | | |
Reserve deducted from assets to which it applies — accounts receivable allowances | | $ | 6,134 | | | $ | 2,595 | | | $ | 80 | (B) | | $ | 2,690 | (A) | | $ | 6,119 | |
|
| | | | | | | | | | | | | | | | | | | | | | |
COLUMN A | | COLUMN B | | COLUMN C | | | COLUMN D | | | COLUMN E |
DESCRIPTION | | BALANCE AT BEGINNING OF PERIOD | | ADDITIONS CHARGED TO COSTS AND EXPENSES | | ADDITIONS (DEDUCTIONS) CHARGED TO OTHER ACCOUNTS | | | DEDUCTIONS FROM RESERVE | | | BALANCE AT END OF PERIOD |
YEAR ENDED JUNE 30, 2013: | | | | | | | | | | | | |
Reserve deducted from assets to which it applies — accounts receivable allowances | | $ | 8,332 |
| | $ | 2,267 |
| | $ | (104 | ) | (A) | | $ | 2,758 |
| (B) | | $ | 7,737 |
|
YEAR ENDED JUNE 30, 2012: | | | | | | | | | | | | |
Reserve deducted from assets to which it applies — accounts receivable allowances | | $ | 7,016 |
| | $ | 3,915 |
| | $ | 122 |
| (A) | | $ | 2,721 |
| (B) | | $ | 8,332 |
|
YEAR ENDED JUNE 30, 2011: | | | | | | | | | | | | |
Reserve deducted from assets to which it applies — accounts receivable allowances | | $ | 6,379 |
| | $ | 2,029 |
| | $ | 111 |
| (A) | | $ | 1,503 |
| (B) | | $ | 7,016 |
|
| | |
(A) | | Amounts represent uncollectible accounts charged off. |
|
(B) | | Amounts represent reserves for the return of merchandise by customers. |
| |
(B) | Amounts represent uncollectible accounts charged off. |
SCHEDULE II
30
SIGNATURES
Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
APPLIED INDUSTRIAL TECHNOLOGIES, INC.
| | |
| | |
/s/ David L. PughNeil A. Schrimsher | | /s/ Benjamin J. MondicsMark O. Eisele |
Neil A. Schrimsher President & Chief Executive Officer | | |
David L. Pugh, Chairman Mark O. Eisele Vice President-Chief Financial Officer & | | Benjamin J. Mondics, President & |
Chief Executive Officer | | Chief Operating Officer Treasurer |
| | |
/s/ Mark O. Eisele | | /s/ Daniel T. Brezovec |
| | |
Mark O. Eisele | | Daniel T. Brezovec |
Vice President-Chief Financial Officer | | Corporate Controller |
& Treasurer | | (Principal Accounting Officer) | | |
Date: August 13, 201020, 2013
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated.
| | |
| | |
* | | * |
| | |
William G. Bares, Director | | Thomas A. Commes, Director |
| | |
* | | * |
| | |
Peter A. Dorsman, Director | | L. Thomas Hiltz, Director |
| | |
* | | * |
| | |
Edith Kelly-Green, Director | | Dan P. Komnenovich, Director |
* | | * |
John F. Meier, Director |
and Chairman | | J. Michael Moore, Director |
* | | /s/ David L. PughNeil A. Schrimsher |
| | |
J. Michael Moore,Vincent K. Petrella, Director | | David L. Pugh, ChairmanNeil A. Schrimsher, President & Chief Executive |
| | Officer and Director |
| | |
* | | * |
| | |
Dr. Jerry Sue Thornton, Director | | Peter C. Wallace, Director |
| | |
* | | |
Stephen E. Yates, Director | | |
| | |
/s/ Fred D. Bauer | | |
Fred D. Bauer, as attorney in fact | | |
for persons indicated by “*” | | |
| | |
Date: August 13, 2010 | | |
31
Date: August 20, 2013
APPLIED INDUSTRIAL TECHNOLOGIES, INC.24
EXHIBIT INDEX
TO FORM 10-K FOR THE YEAR ENDED JUNE 30, 2010
| | | | |
Exhibit | | | | |
No. | | Description | | |
3.1 | | Amended and Restated Articles of Incorporation of Applied Industrial Technologies, Inc., as amended on October 25, 2005 (filed as Exhibit 3(a) to Applied’s Form 10-Q for the quarter ended December 31, 2005, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
3.2 | | Code of Regulations of Applied Industrial Technologies, Inc., as amended on October 19, 1999 (filed as Exhibit 3(b) to Applied’s Form 10-Q for the quarter ended September 30, 1999, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
4.1 | | Certificate of Merger of Bearings, Inc. (Ohio) and Bearings, Inc. (Delaware) filed with the Ohio Secretary of State on October 18, 1988, including an Agreement and Plan of Reorganization dated September 6, 1988 (filed as Exhibit 4(a) to Applied’s Registration Statement on Form S-4 filed May 23, 1997, Registration No. 333-27801, and incorporated here by reference). | | |
| | | | |
4.2 | | Private Shelf Agreement dated as of November 27, 1996, between Applied and Prudential Investment Management, Inc. (assignee of The Prudential Insurance Company of America), conformed to show all amendments (filed as Exhibit 4.2 to Applied’s Form 10-Q for the quarter ended March 31, 2010, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
4.3 | | Credit Agreement dated as of June 3, 2005, among Applied, KeyBank National Association as Agent, and various financial institutions (filed as Exhibit 4.7 to Applied’s Form 10-Q for the quarter ended December 31, 2009, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
4.4 | | First Amendment Agreement dated as of June 6, 2007, among Applied, KeyBank National Association as Agent, and various financial institutions, amending June 3, 2005 Credit Agreement (filed as Exhibit 4 to Applied’s Form 8-K dated June 11, 2007, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
Exhibit | | | | |
No. | | Description | | |
*10.1 | | Form of Change in Control Agreement between Applied and each of its executive officers (filed as Exhibit 99.1 to Applied’s Form 8-K dated April 25, 2008, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.2 | | A written description of Applied’s director compensation program is incorporated by reference to Applied’s proxy statement for the annual meeting of shareholders to be held October 26, 2010, under the caption “Director Compensation.” | | |
| | | | |
*10.3 | | Deferred Compensation Plan for Non-Employee Directors (September 1, 2003 Restatement) the terms of which govern benefits vested as of December 31, 2004, for certain directors (filed as Exhibit 10(c) to Applied’s Form 10-K for the year ended June 30, 2003, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.4 | | Deferred Compensation Plan for Non-Employee Directors (Post-2004 Terms) (filed as Exhibit 10.2 to Applied’s Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). | | |
|
*10.5 | | A written description of Applied’s Life and Accidental Death and Dismemberment Insurance for executive officers (filed as Exhibit 10(d) to Applied’s Form 10-K for the year ended June 30, 2007, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.6 | | A written description of Applied’s Long-Term Disability Insurance for executive officers (filed as Exhibit 10(c) to Applied’s Form 10-Q for the quarter ended December 31, 1997, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.7 | | Form of Director and Officer Indemnification Agreement entered into between Applied and each of its directors and executive officers (filed as Exhibit 10(g) to Applied’s Registration Statement on Form S-4 filed May 23, 1997, Registration No. 333-27801, and incorporated here by reference). | | |
| | | | |
*10.8 | | Supplemental Executive Retirement Benefits Plan (January 1, 2002 Restatement), the terms of which govern benefits vested as of December 31, 2004, for one executive officer, R. C. Shaw (filed as Exhibit 10 to Applied’s Form 10-Q for the quarter ended March 31, 2002, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.9 | | First Amendment to Supplemental Executive Retirement Benefits Plan (January 1, 2002 Restatement) (filed as Exhibit 10 to Applied’s Form 10-Q for the quarter ended September 30, 2004, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
Exhibit | | | | |
No. | | Description | | |
*10.10 | | Supplemental Executive Retirement Benefits Plan (Restated Post-2004 Terms) (filed as Exhibit 10.1 to Applied’s Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.11 | | Deferred Compensation Plan (September 1, 2003 Restatement), the terms of which govern benefits vested as of December 31, 2004, for certain executive officers (filed as Exhibit 10(h) to Applied’s Form 10-K for the year ended June 30, 2003, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.12 | | First Amendment to Deferred Compensation Plan (September 1, 2003 Restatement) (filed as Exhibit 10 to Applied’s Form 10-Q for the quarter ended December 31, 2003, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.13 | | Deferred Compensation Plan (Post-2004 Terms) (filed as Exhibit 10.3 to Applied’s Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.14 | | 1997 Long-Term Performance Plan, as amended April 19, 2007 (filed as Exhibit 10(k) to Applied’s Form 10-K for the year ended June 30, 2007, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.15 | | Section 409A Amendment to the 1997 Long-Term Performance Plan (filed as Exhibit 10.4 to Applied’s Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.16 | | 2007 Long-Term Performance Plan (filed as Exhibit 10 to the Applied’s Form 8-K dated October 23, 2007, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.17 | | Section 409A Amendment to the 2007 Long-Term Performance Plan (filed as Exhibit 10.5 to Applied’s Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.18 | | Supplemental Defined Contribution Plan (January 1, 1997 Restatement) the terms of which govern benefits vested as of December 31, 2004, for certain executive officers (filed as Exhibit 10(m) to Applied’s Registration Statement on Form S-4 filed May 23, 1997, Registration No. 333-27801, and incorporated here by reference). | | |
| | | | |
Exhibit | | | | |
No. | | Description | | |
*10.19 | | First Amendment to Supplemental Defined Contribution Plan effective as of October 1, 2000 (filed as Exhibit 10(a) to Applied’s Form 10-Q for the quarter ended September 30, 2000, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.20 | | Second Amendment to Supplemental Defined Contribution Plan effective as of January 16, 2001 (filed as Exhibit 10(a) to Applied’s Form 10-Q for the quarter ended March 31, 2001, SEC File No. 1-2299, and incorporated here by reference). | | |
| | | | |
*10.21 | | Supplemental Defined Contribution Plan (Post-2004 Terms) (filed as Exhibit 10.6 to Applied’s Form 10-Q for the quarter ended December 31, 2008, SEC File No. 1-2299, and incorporated here by reference). | | |
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*10.22 | | Non-Statutory Stock Option Award Terms and Conditions (Directors) (filed as Exhibit 10 to Applied’s Form 8-K dated November 30, 2005, SEC File No. 1-2299, and incorporated here by reference). | | |
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*10.23 | | Restricted Stock Award Terms (Directors) (filed as Exhibit 10(b) to Applied’s Form 10-Q for the quarter ended March 31, 2007, SEC File No. 1-2299, and incorporated here by reference). | | |
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*10.24 | | Stock Appreciation Rights Award Terms and Conditions (Officers) (filed as Exhibit 10.02 to Applied’s Form 8-K dated September 16, 2009, SEC File No. 1-2299, and incorporated here by reference). | | |
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*10.25 | | Performance Grant Terms and Conditions (filed as Exhibit 10.3 to Applied’s Form 10-Q for the quarter ended September 30, 2008, SEC File No. 1-2299, and incorporated here by reference). | | |
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*10.26 | | Performance Shares Terms and Conditions (filed as Exhibit 10.04 to Applied’s Form 8-K dated September 16, 2009, SEC File No. 1-2299, and incorporated here by reference). | | |
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*10.27 | | Restricted Stock Units Terms and Conditions (filed as Exhibit 10.03 to Applied’s Form 8-K dated September 16, 2009, SEC File No. 1-2299, and incorporated here by reference). | | |
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*10.28 | | Management Incentive Plan General Terms (filed as Exhibit 10.01 to Applied’s Form 8-K dated September 16, 2009, SEC File No. 1-2299, and incorporated here by reference). | | |
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*10.29 | | Non-qualified Deferred Compensation Agreement between Applied and J. Michael Moore effective as of December 31, 1997 (filed as | | |
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Exhibit | | | | |
No. | | Description | | |
| | Exhibit 10(a) to Applied’s Form 10-Q for the quarter ended March 31, 1998, SEC File No. 1-2299, and incorporated here by reference). | | |
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10.30 | | Lease dated as of March 1, 1996 between Applied and the Cleveland-Cuyahoga County Port Authority (filed as Exhibit 10(n) to Applied’s Registration Statement on Form S-4 filed May 23, 1997, Registration No. 333-27801, and incorporated here by reference). | | |
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10.31 | | Asset Purchase Agreement made as of July 14, 2008, among Applied, Fluid Power Resource, LLC (“FPR”), and certain FPR subsidiaries (filed as Exhibit 2.1 to Applied’s Form 8-K dated July 16, 2008, SEC File No. 1-2299, and incorporated here by reference). | | |
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13 | | Applied’s 2010 annual report to shareholders (not deemed “filed” as part of this Form 10-K except for those portions that are expressly incorporated by reference). | | Attached |
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21 | | Applied’s subsidiaries at June 30, 2010. | | Attached |
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23 | | Consent of Independent Registered Public Accounting Firm. | | Attached |
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24 | | Powers of attorney. | | Attached |
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31 | | Rule 13a-14(a)/15d-14(a) certifications. | | Attached |
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32 | | Section 1350 certifications. | | Attached |