CENTRAL PARKING CORPORATION
Condensed Consolidated Balance Sheets
2
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Amendment No. 1
To
Form 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended June 30, 2001
Commission file number 001-13950
CENTRAL PARKING CORPORATION
---------------------------
(Exact Name of Registrant as Specified in Its Charter)
Tennessee 62-1052916
---------------------------------------------- ------------------------------------
(State or Other Jurisdiction of Incorporation
or Organization) (I.R.S. Employer Identification No.)
2401 21st Avenue South,
Suite 200, Nashville, Tennessee 37212
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(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (615) 297-4255
------------------------------------
Former name, address and fiscal year, if changed since last report: Not Applicable
------------------------------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. YES X NO ___
--- ---
Indicate the number of shares outstanding of each of the registrant's classes of
common stock as of the latest practicable date.
Class Outstanding at August 10, 2001
---------------------------------------- ------------------------------------
Common Stock, $0.01 par value 35,904,099
INDEX
CENTRAL PARKING CORPORATION
and SUBSIDIARIES
PART I. FINANCIAL INFORMATION PAGE
- ------- ---------------------- ----
Item 1. Financial Statements (Unaudited)
Consolidated balance sheets
---June 30, 2001 and September 30, 2000 3
Consolidated statements of earnings
---three and nine months ended June 30, 2001 and 2000 4
Consolidated statements of cash flows
---nine months ended June 30, 2001 and 2000 5
Notes to consolidated financial statements 6-14
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 15-20
Item 3. Quantitative and Qualitative Disclosure about Market Risk 20
PART II. OTHER INFORMATION
- ------- -------------------
Item 1. Legal Proceedings 21
Item 6. Exhibits and Reports on Form 8-K 21-26
SIGNATURES 27
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CENTRAL PARKING CORPORATION
and SUBSIDIARIES
Consolidated Balance Sheets
Amounts in thousands, except share data Unaudited
June 30, September 30,
ASSETS 2001 2000
--------- -----------
Current assets:
Cash and cash equivalents $ 34,913 $ 43,214
Management accounts receivable 30,844 32,052
Accounts receivable - other 16,926 14,995
Current portion of notes receivable (including amounts due from related parties
of $3,334 at June 30, 2001 and $786 at September 30, 2000) 5,837 4,090
Prepaid rent 6,880 8,307
Prepaid expenses 5,854 4,953
Deferred income taxes 612 612
--------- -----------
Total current assets 101,866 108,223
Investments, at amortized cost (fair value $6,077 at June 30, 2001 and $5,775 at
September 30, 2000) 5,980 5,778
Notes receivable, less current portion 43,279 46,153
Property, equipment, and leasehold improvements, net 422,747 432,833
Contract and lease rights, net 92,462 96,607
Goodwill, net 256,295 264,756
Investment in and advances to partnerships and joint ventures 30,269 30,306
Other assets 41,095 37,649
--------- -----------
Total assets $993,993 $1,022,305
========= ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt and capital lease obligations $ 53,456 $ 55,760
Accounts payable 69,326 73,461
Accrued payroll and related costs 12,470 14,287
Accrued expenses 12,697 12,236
Management accounts payable 29,509 33,452
Income taxes payable 1,415 8,279
--------- -----------
Total current liabilities 178,873 197,475
Long-term debt and capital lease obligations, less current portion 229,461 253,535
Deferred rent 20,728 18,794
Deferred compensation 12,246 11,732
Deferred income taxes 23,441 24,801
Minority interest 30,244 31,108
Other liabilities 5,622 4,603
--------- -----------
Total liabilities 500,615 542,048
Company-obligated mandatorily redeemable convertible securities of subsidiary
holding solely parent debentures 110,000 110,000
Shareholders' equity:
Common stock, $.01 par value; 50,000,000 shares authorized,
35,897,481 and 36,330,275 shares issued and outstanding, respectively 359 363
Additional paid -in capital 240,035 248,817
Accumulated other comprehensive loss, net (1,202) (144)
Retained earnings 144,888 121,612
Shares held in trust (353) --
Deferred compensation on restricted stock (349) (391)
--------- -----------
Total shareholders' equity 383,378 370,257
--------- -----------
Total liabilities and shareholders' equity $993,993 $1,022,305
========= ===========
See accompanying notes to consolidated financial statements
CENTRAL PARKING CORPORATION
and SUBSIDIARIES
Consolidated Statements of Earnings
Unaudited
Amounts in thousands, except per share data
Three Months Ended Nine Months Ended
June 30, June 30,
2001 2000 2001 2000
--------- --------- --------- ---------
Revenues:
Parking $154,260 $160,405 $454,785 $477,617
Management contract 24,885 25,961 75,959 76,733
--------- --------- --------- ---------
Total revenues 179,145 186,366 530,744 554,350
--------- --------- --------- ---------
Costs and expenses:
Cost of parking 128,485 133,339 379,180 400,038
Cost of management contracts 11,193 8,498 31,192 25,139
General and administrative 17,399 16,832 51,086 56,414
Goodwill and non-compete amortization 3,001 2,975 9,003 9,026
Merger costs -- -- -- 3,747
--------- --------- --------- ---------
Total costs and expenses 160,078 161,644 470,461 494,364
--------- --------- --------- ---------
Property-related gains (losses), net (3,058) (918) (2,577) 2,171
--------- --------- --------- ---------
Operating earnings 16,009 23,804 57,706 62,157
Other income (expenses):
Interest income 1,362 1,808 4,341 5,212
Interest expense (4,718) (6,798) (16,509) (19,966)
Dividends on Company-obligated mandatorily redeemable
convertible securities of a subsidiary trust (1,472) (1,501) (4,415) (4,511)
Minority interest (947) (652) (2,411) (2,512)
Equity in partnership and joint venture earnings 1,510 6,440 4,152 9,105
--------- --------- --------- ---------
Earnings before income taxes, extraordinary item
and cumulative effect of accounting change 11,744 23,101 42,864 49,485
Income tax expense 5,007 8,320 17,711 18,878
--------- --------- --------- ---------
Earnings before extraordinary item and
cumulative effect of accounting change 6,737 14,781 25,153 30,607
Extraordinary item, net of tax -- -- -- (195)
Cumulative effect of accounting change, net of tax -- -- (258) --
--------- --------- --------- ---------
Net earnings $ 6,737 $ 14,781 $ 24,895 $30,412
========= ========= ========= =========
Basic earnings per share:
Earnings before extraordinary item and
cumulative effect of accounting change $ 0.19 $ 0.41 $ 0.70 $ 0.84
Extraordinary item, net of tax -- -- -- --
Cumulative effect of accounting change, net of tax -- -- -- --
------- -------- -------- --------
Net earnings $ 0.19 $ 0.41 $ 0.70 $ 0.84
======== ======== ======== ========
Diluted earnings per share:
Earnings before extraordinary item and
cumulative effect of accounting change $ 0.19 $ 0.40 $ 0.70 $ 0.83
Extraordinary item, net of tax -- -- -- (0.01)
Cumulative effect of accounting change, net of tax -- -- (0.01) --
------- -------- -------- --------
Net earnings $ 0.19 $ 0.40 $ 0.69 $ 0.82
======== ======== ======== ========
See accompanying notes to consolidated financial statements.
CENTRAL PARKING CORPORATION
and SUBSIDIARIES
Consolidated Statements of Cash Flows
Unaudited
Amounts in thousands Nine Months Ended
June 30,
2001 2000
--------- ---------
Cash flows from operating activities:
Net earnings $ 24,895 $ 30,412
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization of property 16,064 18,112
Amortization of goodwill and non-compete 9,003 9,026
Amortization of contract and lease rights, straight-line rent, deferred financing fees and other 10,682 9,274
Equity in partnership and joint venture earnings (4,152) (9,105)
Distributions from partnerships and joint ventures 2,649 3,034
Property-related (gains) losses, net 2,577 (2,171)
Deferred income tax (benefit) expense (537) 658
Minority interest 2,411 2,512
Changes in operating assets and liabilities:
Management accounts receivable 1,208 (2,535)
Accounts receivable - other (1,461) 2,763
Prepaid rent 1,427 2,166
Prepaid expenses (901) 1,127
Other assets (7,102) 457
Accounts payable, accrued expenses and deferred compensation (13,682) (10,337)
Management accounts payable (3,943) 722
Income taxes payable (6,864) 6,289
--------- ---------
Net cash provided by operating activities 32,274 62,404`
--------- ---------
Cash flows from investing activities:
Proceeds from disposition of property and equipment 21,325 20,780
Repayments of notes receivable, net 1,127 985
Purchase of property, equipment, and leasehold improvements (22,562) (49,959)
Purchase of contract and lease rights (2,041) (660)
Repayments of advances to partnerships and joint ventures, net 1,540 5,865
Proceeds from maturities and calls of investments 866 80
Purchase of investments (1,103) (309)
--------- ---------
Net cash used by investing activities (848) (23,218)
--------- ---------
Cash flows from financing activities:
Dividends paid (1,625) (1,650)
Net borrowings (repayments) under revolving credit agreement, net of issuance costs 16,100 (34,476)
Proceeds from issuance of notes payable, net of issuance costs -- 13,300
Payment to minority interest partners (3,114) (3,350)
Principal repayments on notes payable and capital lease obligations (42,478) (15,446)
Repurchase of common stock (10,863) (10,268)
Proceeds from issuance of common stock and exercise of stock options, net 2,077 5,148
--------- ---------
Net cash used by financing activities (39,903) (46,742)
--------- ---------
Foreign currency translation 176 (61)
--------- ---------
Net decrease in cash and cash equivalents (8,301) (7,617)
Cash and cash equivalents at beginning of period 43,214 53,669
--------- ---------
Cash and cash equivalents at end of period $ 34,913 $ 46,052
========= =========
Supplemental cash flow information:
Cash paid for interest $ 15,230 $ 20,733
Cash paid for income taxes $ 24,783 $ 10,643
Page 10 of 1
See accompanying notes to consolidated financial statements.
CENTRAL PARKING CORPORATION
and SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements of Central Parking
Corporation ("Central Parking" or the "Company") have been prepared in
accordance with accounting principles generally accepted in the United States of
America and with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by accounting principles generally accepted in the United States of America for
complete financial statements. In the opinion of management, the unaudited
consolidated financial statements reflect all adjustments considered necessary
for a fair presentation, consisting only of normal and recurring adjustments.
All significant inter-company transactions have been eliminated in
consolidation. Operating results for the three and nine months ended June 30,
2001 are not necessarily indicative of the results that may be expected for the
fiscal year ending September 30, 2001. For further information, refer to the
consolidated financial statements and footnotes thereto for the year ended
September 30, 2000 (included in the Company's Annual Report on Form 10-K).
Certain items have been reclassified to conform to the current year
presentation.
BUSINESS COMBINATIONS
Contract and Lease Rights
The Company entered into an agreement effective June 1, 2000 to acquire
certain lease and contract rights for approximately $14.3 million. The
transaction was financed by the seller with a two-year obligation due in 2002.
The lease rights are being amortized over 17 years, the remaining term of the
lease, and the contract rights are being amortized over 3.5 years.
Arizona Stadium LLC
In October 1999, the Company paid $1.6 million to purchase the remaining
50% interest in Arizona Stadium LLC, a limited liability company that manages
the parking activities for a garage adjacent to a baseball stadium in Phoenix.
The Company previously owned 50% of the limited liability company. In
accordance with the partnership agreement, the Company was required to repay the
outstanding note payable and incurred approximately $195 thousand of expenses,
net of tax, related to early extinguishement of debt. This expense has been
accounted for as an extraordinary loss in the nine months ended June 30, 2000.
Allright Holdings, Inc.
On March 19, 1999, the Company completed a merger with Allright Holdings,
Inc. ("Allright"), pursuant to which approximately 7.0 million shares of Central
Parking common stock and approximately 0.5 million options and warrants to
purchase common stock of Central Parking, were exchanged for all of the
outstanding shares of common stock and options and warrants to purchase common
stock of Allright.
The Company incurred $3.7 million of merger related expenses on a pretax
basis during the nine months ended June 30, 2000 that were reported as operating
expenses. These costs included $1.3 million of legal, accounting, and consulting
fees; $1.1 million related to employment agreements and severance; and $1.3
million in travel, supplies, printing and other out-of-pocket expenses. Those
costs which were directly attributable to the merger and were incremental to the
combined companies were recognized when incurred. No such costs have been
incurred in fiscal 2001.
EARNINGS PER SHARE
Basic earnings per share excludes dilution and is computed by dividing
income available to common shareholders by the weighted-average number of common
shares outstanding for the period. Diluted earnings per share reflects the
potential dilution that could occur if securities or other contracts to issue
common stock were exercised or converted into common stock or resulted in the
issuance of common stock, or if restricted shares of common stock were to become
fully vested, that then shared in the earnings of the entity.
The following table sets forth the computation of basic and diluted
earnings per share:
Three Months Ended June 30,
---------------------------
2001 2000
---- ----
Income Common Per Income Common Per
Available Shares Share Available Shares Share
($000's) (000's) Amount ($000's) (000's) Amount
-------- ------- ------ -------- ------- ------
Basic earnings per share:
Earnings before extraordinary item and
cumulative effect of accounting change. $ 6,737 35,740 $ 0.19 $ 14,781 36,260 $ 0.41
Effect of dilutive stock and options:
Stock option plan and warrants....... -- 91 -- -- 201 (0.01)
Restricted stock plan ............... -- 69 -- -- 192 --
-------- ------ --------- -------- ------ -------
Diluted earnings per share:
Earnings before extraordinary item and
cumulative effect of accounting change. $ 6,737 35,900 $ 0.19 $ 14,781 36,653 $ 0.40
======== ====== ========= ======== ====== =======
Nine Months Ended June 30,
---------------------------
2001 2000
---- ----
Income Common Per Income Common Per
Available Shares Share Available Shares Share
($000's) (000's) Amount ($000's) (000's) Amount
-------- ------- ------ -------- ------- ------
Basic earnings per share:
Earnings before extraordinary item and
cumulative effect of accounting change. $ 25,153 35,818 $ 0.70 $ 30,607 36,418 $ 0.84
Effect of dilutive stock and options:
Stock option plan and warrants....... -- 106 -- -- 204 (0.01)
Restricted stock plan ............... -- 122 -- -- 184 --
-------- ------ --------- -------- ------ -------
Diluted earnings per share:
Earnings before extraordinary item and
cumulative effect of accounting change. $ 25,153 36,046 $ 0.70 $ 30,607 36,806 $ 0.83
======== ====== ========= ======== ====== =======
Weighted average common shares used for the computation of basic earnings
per share excludes certain common shares issued pursuant to the Company's
restricted stock plan and deferred compensation agreement, because under the
related agreements the holder of such restricted stock may forfeit the shares if
certain employment or service requirements are not met.
The effect of the conversion of the company-obligated mandatorily
redeemable securities of the subsidiary trust has not been included in the
diluted earnings per share calculation since such securities are anti-dilutive.
At June 30, 2001 and 2000, such securities were convertible into 2,000,000
shares of common stock. For the three and nine months ended June 30, 2001,
options to purchase 2,005,406 and 1,866,682 shares are excluded from the diluted
common shares since they are anti-dilutive.
PROPERTY-RELATED GAINS (LOSSES), NET
The Company routinely disposes of owned properties due to various factors,
including economic considerations, unsolicited offers from third parties and
condemnation proceedings initiated by local government authorities. Leased
properties are also periodically evaluated and determinations may be made to
sell or exit a lease obligation. A summary of property-related gains and losses
for the three and nine months ended June 30, 2001 and 2000 is as follows (in
thousands):
Three months ended Nine months ended
June 30, June 30,
2001 2000 2001 2000
-------- ------ -------- --------
Net gains (losses) on sale of property $ 1,131 $(918) $ 6,650 $ 2,666
Impairment charges for property,
equipment and leasehold improvements (200) -- (3,545) --
Impairment charges for contract rights,
lease rights and other intangible assets -- -- (492) (495)
Lease termination costs (3,989) -- (5,190) --
-------- ------ -------- --------
Total property-related gains (losses), net $(3,058) $(918) $(2,577) $ 2,171
======== ====== ======== =========
Included in net gains on sale of property for the three and nine months
ended June 30, 2001 is a $250 thousand loss for environmental liability costs
relating to a property previously owned by the Company. The Company recorded
impairment charges totaling $4.0 million during the nine months ended June 30,
2001, of which $3.5 million was attributable to properties where the operating
lease agreement was amended such that the carrying value of the leasehold
improvements was no longer supportable by projected future cash flows. The
remaining $0.5 million of the charge reflects a reduction in certain
Allright-related intangible assets which are no longer of any value to the
Company. The Company recorded impairment charges of $0.5 million during the nine
months ended June 30, 2000. Lease termination costs for the three and nine
months ended June 30, 2001 represent charges incurred to terminate existing
lease agreements related to unfavorable locations.
LONG-TERM DEBT
On March 19, 1999, the Company established a credit facility (the "Credit
Facility") providing for an aggregate availability of up to $400 million
consisting of a five-year $200 million revolving credit facility including a
sub-limit of $25 million for standby letters of credit, and a $200 million
five-year term loan. The Credit Facility bears interest at LIBOR plus a grid
based margin dependent upon Central Parking achieving certain financial ratios.
The amount outstanding under the Company's Credit Facility as of June 30, 2001
was $244.0 million with a weighted average interest rate of 4.9% including the
principal amount of the term loan of $137.5 million which is being repaid in
quarterly payments of $12.5 million through March 2004. The Credit Facility
contains covenants including those that require the Company to maintain certain
financial ratios, restrict further indebtedness and limit the amount of
dividends paid. The aggregate availability under the Credit Facility was $68.5
million at June 30, 2001.
The Company is required under the Credit Facility to enter into certain
interest rate protection agreements designed to fix interest rates on variable
rate debt and reduce exposure to fluctuations in interest rates. On October 27,
1999 the Company entered into a $25 million interest rate swap for a term of
four years, cancelable after two years at the option of the counterparty, under
which the Company will pay to the counterparty a fixed rate of 6.16%, and the
counterparty will pay to the Company a variable rate equal to LIBOR. The
transaction involved an exchange of fixed rate payments for variable rate
payments and does not involve the exchange of the underlying notional value. On
June 30, 2000, June 29, 2000, and again on September 29, 2000, the Company
entered into $25 million interest rate cap agreements. The rate is 8.0% for the
first two cap agreements and 8.5% for the last cap agreement and each has a term
consistent with the Credit Facility's. The Company paid a total of $646 thousand
for the three $25 million cap agreements.
The Company entered into an agreement effective June 1, 2000, to acquire
certain contract and lease rights for approximately $14.3 million. The
transaction was financed by the seller with a two-year obligation due June 2002
at an interest rate of 7.32% and is backed by a letter of credit in the amount
of $15.0 million.
NEW ACCOUNTING PRONOUNCEMENTS
Derivative financial instruments
In June 1998, the Financial Accounting Standards Board ("FASB") issued SFAS No.
133, "Accounting for Derivative Instruments and Hedging Activities." SFAS No.
133 established reporting standards for derivative instruments, including
certain derivative instruments embedded in other contracts. Under SFAS No. 133,
the Company recognizes all derivatives as either assets or liabilities, measured
at fair value, in the statement of financial position. In June 2000, SFAS No.
138 "Accounting for Certain Derivative Instruments and Certain Hedging
Activities, an Amendment of FASB Statement No. 133" was issued clarifying the
accounting for derivatives under the new standard.
At June 30, 2001, the Company's derivative financial instruments consist of
interest rate caps with a combined notional amount of $75 million and interest
rate swaps with a combined notional amount of $38 million that effectively
convert an equal portion of its debt from a floating rate to a fixed rate. The
Company's purpose for holding such instruments is to hedge its exposure to cash
flow fluctuations due to changes in market interest rates.
On October 1, 2000, the Company prospectively adopted the provisions of
SFAS No. 133 and SFAS No. 138, which resulted in the recording of a net
transition loss of $380 thousand, net of related income taxes of $253 thousand,
in accumulated other comprehensive loss. Further, the adoption of SFAS No. 133
and SFAS No. 138 resulted in the Company reducing derivative instrument assets
by $281 thousand and recording $353 thousand of derivative instrument
liabilities.
At June 30, 2001, the Company adjusted the value of its derivative
financial instruments to their fair values. These instruments comprised
derivative instrument assets of $111 thousand and derivative instrument
liabilities of $1.7 million, which are included as other assets and other
liabilities, respectively, on the face of the balance sheet. This adjustment
resulted in the recognition of unrealized gains of $125 thousand and unrealized
losses of $929 thousand, net of related income tax expense of $83 thousand and
benefit of $619 thousand in accumulated other comprehensive loss for the three
and nine months ended June 30, 2001, respectively. Additionally, the Company
increased derivative instrument assets by $19 thousand and decreased derivative
instruments assets by $218 thousand and decreased derivative instrument
liabilities by $190 thousand and increased derivative instrument liabilities by
$1.3 million for the three and nine months ended June 30, 2001, respectively.
Revenue recognition
In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin No. 101, "Revenue Recognition in Financial Statements" (SAB 101). The
Company adopted SAB 101 during the quarter ended March 31, 2001 as a change in
accounting principle retroactive to October 1, 2000. Adoption of SAB 101
required the Company to change the timing of recognition of performance-based
revenues on certain management contracts. The cumulative effect of this
accounting change was a loss of $429 thousand ($258 thousand, net of tax) as of
October 1, 2000. Adoption of SAB 101 resulted in an increase in management
contract revenues of $2 thousand and $58 thousand for the three and nine months
ended June 30, 2001, respectively.
Business combinations, goodwill and intangible assets
In July 2001, the FASB issued SFAS No. 141, Business Combinations, and SFAS
No. 142, Goodwill and Other Intangible Assets. SFAS No. 141 requires that the
purchase method of accounting be used for all business combinations initiated
after June 30, 2001. SFAS No. 141 also specifies criteria which intangible
assets acquired in a purchase method business combination must meet to be
recognized and reported apart from goodwill. SFAS No. 142 requires that
goodwill and intangible assets with indefinite useful lives no longer be
amortized, but instead tested for impairment at least annually in accordance
with the provisions of SFAS No. 142. SFAS No. 142 also requires that intangible
assets with definite useful lives be amortized over their respective estimated
useful lives to their estimated residual values, and reviewed for impairment in
accordance with SFAS No. 121, Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed Of.
The Company is required to adopt the provisions of SFAS No. 141
immediately, except with regard to business combinations initiated prior to July
1, 2001. SFAS No. 142 must be adopted by October 1, 2002, but may be adopted as
of October 1, 2001. The Company intends to elect this early adoption.
Furthermore, any goodwill and any intangible asset determined to have an
indefinite useful life that are acquired in a purchase business combination
completed after June 30, 2001 will not be amortized, but will continue to be
evaluated for impairment in accordance with the appropriate pre-SFAS No. 142
accounting literature. Goodwill and intangible assets acquired in business
combinations completed before July 1, 2001 will continue to be amortized prior
to the adoption of SFAS No. 142.
SFAS No. 141 will require, upon adoption of SFAS No. 142, that the Company
evaluate its existing intangible assets and goodwill that were acquired in a
prior purchase business combination, and to make any necessary reclassifications
in order to conform with the new criteria in SFAS No. 141 for recognition apart
from goodwill. Upon adoption of SFAS No. 142, the Company will be required to
reassess the useful lives and residual values of all intangible assets acquired
in purchase business combinations, and make any necessary amortization period
adjustments by the end of the first interim period after adoption. In addition,
to the extent an intangible asset is identified as having an indefinite useful
life, the Company will be required to test the intangible asset for impairment
in accordance with the provisions of SFAS No. 142 within the first interim
period. Any impairment loss will be measured as of the date of adoption and
recognized as the cumulative effect of a change in accounting principle in the
first interim period.
In connection with the transitional goodwill impairment evaluation, SFAS
No. 142 will require the Company to perform an assessment of whether there is an
indication that goodwill is impaired as of the date of adoption. To accomplish
this the Company must identify its reporting units and determine the carrying
value of each reporting unit by assigning the assets and liabilities, including
the existing goodwill and intangible assets, to those reporting units as of the
date of adoption. The Company will then have up to six months from the date of
adoption to determine the fair value of each reporting unit and compare it to
the reporting unit's carrying amount. To the extent a reporting unit's carrying
amount exceeds its fair value, an indication exists that the reporting unit's
goodwill may be impaired and the Company must perform the second step of the
transitional impairment test. In the second step, the Company must compare the
implied fair value of the reporting unit's goodwill, determined by allocating
the reporting unit's fair value to all of it assets (recognized and
unrecognized) and liabilities in a manner similar to a purchase price allocation
in accordance with SFAS No. 141, to its carrying amount, both of which would be
measured as of the date of adoption. This second step is required to be
completed as soon as possible, but no later than the end of the year of
adoption. Any transitional impairment loss will be recognized as the cumulative
effect of a change in accounting principle in the Company's statement of
earnings.
As of the date of adoption, the Company expects to have unamortized
goodwill in the amount of $253.3 million and unamortized identifiable intangible
assets in the amount of $96.0 million, all of which will be subject to the
transition provisions of SFAS No. 141 and 142. Amortization expense related to
goodwill was $9.0 million for the nine months ended June 30, 2001 and $12.0
million for the year ended September 30, 2000. Because of the extensive effort
needed to comply with adopting SFAS No. 141 and 142, it is not practicable to
reasonably estimate the impact of adopting these Statements on the Company's
financial statements at the date of this report, including whether any
transitional impairment losses will be required to be recognized as the
cumulative effect of a change in accounting principle.
STOCK OPTION CANCELLATION PROGRAM
During the third quarter of fiscal 2001 the Company initiated and completed
a stock option buyback and cancellation program. The Company repurchased
244,375 existing options from non-executive employees with exercise prices at or
above $29.25 per share. The Company recognized $100 thousand as compensation
expense for the three and nine months ended June 30, 2001, related to the option
repurchases.
SHARES HELD IN TRUST
During the third quarter of fiscal 2001 the Company amended an employment
agreement with the Company's President and transferred 133,875 shares of
restricted common stock previously issued under a restricted stock plan, into a
Rabbi Trust. The President has no authority over the administration of the
Rabbi Trust. Transfer of these shares resulted in an increase in liabilities
and a decrease in equity of $353 thousand.
COMPREHENSIVE INCOME
Comprehensive income, which is comprised of net earnings, changes in
unrealized gains and losses on derivative financial instruments and changes in
foreign currency translation adjustments, was $6.9 million and $23.8 million for
the three and nine months ended June 30, 2001, respectively. Comprehensive
income was $14.6 million and $30.4 million for the three and nine months ended
June 30, 2000, respectively.
SUBSEQUENT EVENT
In July 2001, the Company agreed to purchase approximately 62 management
contracts, as well as substantially all of the operating assets, of USA Parking
Systems. The management contracts acquired are primarily in south Florida and
Puerto Rico.
BUSINESS SEGMENTS
The Company is managed based on segments administered by senior vice
presidents. These segments are generally organized geographically, with
exceptions depending on the needs of specific regions. The following are
summaries of revenues, costs, and other expenses by segment for the three and
nine months ended June 30, 2001 and 2000, respectively. During fiscal year
2001, the Company realigned certain locations among segments. All prior year
segment data has been reclassified to conform to the new segment alignment.
Three Months Ended June 30, 2001
-------------------------------------
ALL
OTHERS
& GEN'L
ONE TWO THREE FOUR FIVE SIX SEVEN INT'L CORP
--- --- ----- ---- ---- --- ----- ----- ----
Revenues:
Parking $10,743 $ 67,449 $ 7,899 $18,000 $ 9,488 $14,240 $15,382 $ 7,667 $ 3,392
Management contract 2,584 6,171 2,263 3,495 2,768 1,863 1,709 1,806 2,226
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Total revenues 13,327 73,620 10,162 21,495 12,256 16,103 17,091 9,473 5,618
Costs and expenses:
Cost of parking 9,593 57,290 7,252 16,334 7,918 12,215 14,118 6,625 (2,860)
Cost of management contracts 1,487 2,488 1,131 1,297 1,021 705 847 8 2,209
General and administrative 1,333 5,902 682 1,137 936 1,267 1,323 1,171 3,648
Goodwill and non-compete
amortization 56 2,071 112 123 96 258 3 -- 282
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Total costs and expenses 12,469 67,751 9,177 18,891 9,971 14,445 16,291 7,804 3,279
Property-related gains (losses), net (8) (4,227) -- (5) (9) (1) (7) (2) 1,201
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Operating earnings 850 1,642 985 2,599 2,276 1,657 793 1,667 3,540
Other income (expense):
Interest income (38) (4,609) (70) (1) (13) (555) -- 75 6,573
Interest expense (9) (242) (28) (63) (46) (35) (2) (93) (4,200)
Dividends - convertible securities -- -- -- -- -- -- -- -- (1,472)
Minority interest -- (282) (5) -- -- 22 -- -- (682)
Equity in partnership and
joint venture earnings -- -- -- -- -- 1 -- 287 1,222
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Earnings (loss) before
income tax $ 803 $ (3,491) $ 882 $ 2,535 $ 2,217 $ 1,090 $ 791 $ 1,936 $ 4,981
======== ========= ======== ======== ======== ======== ======== ======== =========
Income tax expense
Net earnings
Identifiable assets $23,418 $470,290 $21,119 $47,706 $12,569 $33,609 $25,222 $29,919 $330,141
======== ========= ======== ======== ======== ======== ======== ======== =========
TOTAL
-----
Revenues:
Parking $154,260
Management contract 24,885
---------
Total revenues 179,145
Costs and expenses:
Cost of parking 128,485
Cost of management contracts 11,193
General and administrative 17,399
Goodwill and non-compete
amortization 3,001
---------
Total costs and expenses 160,078
Property-related gains (losses), net (3,058)
---------
Operating earnings 16,009
Other income (expense):
Interest income 1,362
Interest expense (4,718)
Dividends - convertible securities (1,472)
Minority interest (947)
Equity in partnership and
joint venture earnings 1,510
---------
Earnings (loss) before
income tax 11,744
Income tax expense 5,007
---------
Net earnings $ 6,737
=========
Identifiable assets $993,993
=========
Three Months Ended June 30, 2000
-------------------------------------
ALL
OTHERS
& GEN'L
ONE TWO THREE FOUR FIVE SIX SEVEN INT'L CORP
--- --- ----- ---- ---- --- ----- ----- ----
Revenues:
Parking $12,157 $ 67,251 $ 9,389 $21,359 $ 9,493 $14,693 $14,583 $ 7,681 $ 3,799
Management contract 2,841 6,409 2,246 3,572 2,961 2,166 1,737 1,359 2,670
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Total revenues 14,998 73,660 11,635 24,931 12,454 16,859 16,320 9,040 6,469
Costs and expenses:
Cost of parking 10,672 57,337 9,005 19,087 8,092 12,918 12,593 6,077 (2,442)
Cost of management contracts 1,039 2,014 840 1,431 1,186 905 758 342 (17)
General and administrative 1,412 5,098 647 1,307 1,163 1,373 960 1,202 3,670
Goodwill and non-compete
amortization 50 2,071 112 123 96 259 3 -- 261
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Total costs and expenses 13,173 66,520 10,604 21,948 10,537 15,455 14,314 7,621 1,472
Property-related gains (losses), net (2) (33) 28 (442) (2,576) 1 (18) (11) 2,135
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Operating earnings 1,823 7,107 1,059 2,541 (659) 1,405 1,988 1,408 7,132
Other income (expense):
Interest income (42) (4,600) (81) (1) (23) (575) 24 87 7,019
Interest expense 7 (397) (41) (24) (62) (131) (1) (40) (6,109)
Dividends - convertible securities -- -- -- -- -- -- -- -- (1,501)
Minority interest -- 87 1 -- -- -- -- -- (740)
Equity in partnership and
joint venture earnings -- -- -- -- -- -- -- 50 6,390
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Earnings (loss) before
income tax $ 1,788 $ 2,197 $ 938 $ 2,516 $ (744) $ 699 $ 2,011 $ 1,505 $ 12,191
======== ========= ======== ======== ======== ======== ======== ======== =========
Income tax expense
Net earnings
Identifiable assets $43,410 $504,963 $49,607 $70,630 $40,875 $83,415 $33,020 $25,947 $209,311
======== ========= ======== ======== ======== ======== ======== ======== =========
TOTAL
-----
Revenues:
Parking $ 160,405
Management contract 25,961
-----------
Total revenues 186,366
Costs and expenses:
Cost of parking 133,339
Cost of management contracts 8,498
General and administrative 16,832
Goodwill and non-compete
amortization 2,975
-----------
Total costs and expenses 161,644
Property-related gains (losses), net (918)
-----------
Operating earnings 23,804
Other income (expense):
Interest income 1,808
Interest expense (6,798)
Dividends - convertible securities (1,501)
Minority interest (652)
Equity in partnership and
joint venture earnings 6,440
-----------
Earnings (loss) before
income tax 23,101
Income tax expense 8,320
-----------
Net earnings $ 14,781
===========
Identifiable assets $1,061,178
===========
Nine Months Ended June 30, 2001
-------------------------------------
ALL
OTHERS
& GEN'L
ONE TWO THREE FOUR FIVE SIX SEVEN INT'L CORP
--- --- ----- ---- ---- --- ----- ----- ----
Revenues:
Parking $31,914 $201,320 $24,315 $53,975 $27,840 $42,352 $42,127 $20,790 $ 10,152
Management contract 7,756 18,627 7,012 10,871 8,257 5,733 5,402 4,899 7,402
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Total revenues 39,670 219,947 31,327 64,846 36,097 48,085 47,529 25,689 17,554
Costs and expenses:
Cost of parking 28,742 170,395 22,355 49,119 23,346 36,957 38,958 17,833 (8,525)
Cost of management contracts 4,040 7,226 3,172 4,466 3,290 2,490 2,230 50 4,228
General and administrative 3,853 16,942 2,176 3,594 3,002 4,050 3,279 3,369 10,821
Goodwill and non-compete
amortization 168 6,215 337 370 288 776 9 -- 840
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Total costs and expenses 36,803 200,778 28,040 57,549 29,926 44,273 44,476 21,252 7,364
Property-related gains (losses), net (5) (8,827) (7) 704 179 (1) (9) (2) 5,391
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Operating earnings 2,862 10,342 3,280 8,001 6,350 3,811 3,044 4,435 15,581
Other income (expense):
Interest income (116) (13,806) (215) (3) (39) (1,693) 47 259 19,907
Interest expense (85) (830) (105) (199) (162) (119) (31) (198) (14,780)
Dividends - convertible securities -- -- -- -- -- -- -- -- (4,415)
Minority interest -- (356) (11) -- -- 22 -- -- (2,066)
Equity in partnership and
joint venture earnings -- -- -- -- -- -- -- 1,105 3,047
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Earnings (loss) before income
tax and cumulative effect of
accounting change $ 2,661 $ (4,650) $ 2,949 $ 7,799 $ 6,149 $ 2,021 $ 3,060 $ 5,601 $ 17,274
======== ========= ======== ======== ======== ======== ======== ======== =========
Income tax expense
Earnings before cumulative
effect of accounting change
Cumulative effect of accounting
change, net of tax
Net earnings
Identifiable assets $23,418 $470,290 $21,119 $47,706 $12,569 $33,609 $25,222 $29,919 $330,141
======== ========= ======== ======== ======== ======== ======== ======== =========
TOTAL
-----
Revenues:
Parking $454,785
Management contract 75,959
---------
Total revenues 530,744
Costs and expenses:
Cost of parking 379,180
Cost of management contracts 31,192
General and administrative 51,086
Goodwill and non-compete
amortization 9,003
---------
Total costs and expenses 470,461
Property-related gains (losses), net (2,577)
---------
Operating earnings 57,706
Other income (expense):
Interest income 4,341
Interest expense (16,509)
Dividends - convertible securities (4,415)
Minority interest (2,411)
Equity in partnership and
joint venture earnings 4,152
---------
Earnings (loss) before income
tax and cumulative effect of
accounting change 42,864
Income tax expense 17,711
---------
Earnings before cumulative
effect of accounting change 25,153
Cumulative effect of accounting
change, net of tax (258)
---------
Net earnings $ 24,895
=========
Identifiable assets $993,993
=========
Nine Months Ended June 30, 2000
-------------------------------------
ALL
OTHERS
& GEN'L
ONE TWO THREE FOUR FIVE SIX SEVEN INT'L CORP
--- --- ----- ---- ---- --- ----- ----- ----
Revenues:
Parking $35,106 $205,243 $28,908 $64,526 $28,707 $42,065 $42,763 $20,813 $ 9,486
Management contract 8,601 18,908 6,716 11,047 8,985 6,268 5,602 4,107 6,499
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Total revenues 43,707 224,151 35,624 75,573 37,692 48,333 48,365 24,920 15,985
Costs and expenses:
Cost of parking 31,650 172,595 27,277 57,897 24,473 38,253 38,404 17,555 (8,066)
Cost of management contracts 2,918 5,906 2,437 4,394 3,370 2,482 2,034 39 1,559
General and administrative 4,123 15,402 2,025 3,987 3,978 3,720 2,999 3,470 16,710
Goodwill and non-compete
amortization 137 6,416 337 370 294 783 9 -- 680
Merger costs -- -- -- -- -- -- -- -- 3,747
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Total costs and expenses 38,828 200,319 32,076 66,648 32,115 45,238 43,446 21,064 14,630
Property-related gains (losses), net 150 (10) 25 (371) (2,574) 1 (56) 3 5,003
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Operating earnings 5,029 23,822 3,573 8,554 3,003 3,096 4,863 3,859 6,358
Other income (expense):
Interest income (110) (13,807) (248) (1) (70) (1,716) 73 208 20,883
Interest expense (32) (1,197) (117) (71) (179) (224) (2) (125) (18,019)
Dividends - convertible securities -- -- -- -- -- -- -- -- (4,511)
Minority interest -- (243) (7) -- -- -- -- -- (2,262)
Equity in partnership and
joint venture earnings -- -- -- -- -- -- -- 200 8,905
-------- --------- -------- -------- -------- -------- -------- -------- ---------
Earnings (loss) before income
tax and extraordinary item $ 4,887 $ 8,575 $ 3,201 $ 8,482 $ 2,754 $ 1,156 $ 4,934 $ 4,142 $ 11,354
======== ========= ======== ======== ======== ======== ======== ======== =========
Income tax expense
Earnings before
extraordinary item
Extraordinary item, net of tax
Net earnings
Identifiable assets $43,410 $504,963 $49,607 $70,630 $40,875 $83,415 $33,020 $25,947 $209,311
======== ========= ======== ======== ======== ======== ======== ======== =========
TOTAL
-----
Revenues:
Parking $ 477,617
Management contract 76,733
-----------
Total revenues 554,350
Costs and expenses:
Cost of parking 400,038
Cost of management contracts 25,139
General and administrative 56,414
Goodwill and non-compete
amortization 9,026
Merger costs 3,747
-----------
Total costs and expenses 494,364
Property-related gains (losses), net 2,171
-----------
Operating earnings 62,157
Other income (expense):
Interest income 5,212
Interest expense (19,966)
Dividends - convertible securities (4,511)
Minority interest (2,512)
Equity in partnership and
joint venture earnings 9,105
-----------
Earnings (loss) before income
tax and extraordinary item 49,485
Income tax expense 18,878
-----------
Earnings before
extraordinary item 30,607
Extraordinary item, net of tax (195)
-----------
Net earnings $ 30,412
===========
Identifiable assets $1,061,178
===========
Segment One encompasses the western region of the United States.
Segment Two encompasses the northeastern region of the United States, including
New York City, New Jersey, Eastern Pennsylvania, and New England.
Segment Three encompasses the southeastern region of the United States.
Segment Four encompasses parts of the midwestern and southern region of the
United States, including parts of Kentucky, Tennessee, Louisiana, and Southern
Texas.
Segment Five encompasses the inter-mountain region of the United States,
including Northern Texas and parts of the Mid-west.
Segment Six encompasses the southern region of the United States, as well as
Washington, D.C. and Puerto Rico.
Segment Seven encompasses the central region of the United States.
International encompasses all non-U.S. locations.
All others and general corporate encompasses home office, eliminations, certain
owned real estate and certain partnerships.
Item 2. Management's Discussion and Analysis of Financial Condition and
-------------------------------------------------------------------------------
Results of Operations
----------------------
FORWARD-LOOKING STATEMENTS MAY PROVE INACCURATE
This report includes various forward-looking statements regarding the
Company that are subject to risks and uncertainties, including, without
limitation, the factors set forth below and under the caption "Risk Factors" in
the Management's Discussion and Analysis of Financial Condition and Results of
Operations section of the Company's Report on Form 10-K for the year ended
September 30, 2000. Forward-looking statements include, but are not limited to,
discussions regarding the Company's operating strategy, growth strategy,
acquisition strategy, cost savings initiatives, industry, economic conditions,
financial condition, liquidity and capital resources and results of operations.
Such statements include, but are not limited to, statements preceded by,
followed by or that otherwise include the words "believes," "expects,"
"anticipates," "intends," "estimates" or similar expressions. For those
statements, the Company claims the protection of the safe harbor for
forward-looking statements contained in the Private Securities Litigation Reform
Act of 1995.
The following important factors, in addition to those discussed elsewhere
in this report, and the Company's report on Form 10-K for the year ended
September 30, 2000 could affect the future financial results of the Company and
could cause actual results to differ materially from those expressed in
forward-looking statements contained or incorporated by reference in this
document:
- - ongoing integration of past and future acquisitions in light of challenges
in retaining key employees, synchronizing business processes and efficiently
integrating facilities, marketing, and operations;
- - successful implementation of the Company's operating and growth strategy,
including possible strategic acquisitions;
- - fluctuations in quarterly operating results caused by a variety of factors
including the timing of gains on sales of owned facilities, preopening costs,
changes in the Company's cost of borrowing, effect of weather on travel and
transportation patterns, player strikes or other events affecting major league
sports and local, national and international economic conditions;
- - the ability of the Company to form and maintain its strategic
relationships with certain large real estate owners and operators;
- - global and/or regional economic factors;
- - compliance with laws and regulations, including, without limitation,
environmental, antitrust and consumer protection laws and regulations at the
federal, state, local and international levels.
OVERVIEW
The Company operates parking facilities under three types of arrangements:
leases, fee ownership, and management contracts. Parking revenues from owned
properties amounted to $18.1 million and $19.5 million for the three months
ended June 30, 2001 and 2000, respectively, representing 11.8% and 12.1% of
total parking revenues for the respective periods. For the nine months ended
June 30, 2001 and 2000, parking revenues from owned properties were $54.6
million and $56.9 million, respectively, representing 12.0% and 11.9% of total
parking revenues for the respective periods. Ownership of parking facilities,
either independently or through joint ventures, typically requires a larger
capital investment than managed or leased facilities but provides maximum
control over the operation of the parking facility and the greatest profit
potential of the three types of operating arrangements. As the owner, all
changes in owned facility revenue and expense flow directly to the Company.
Additionally, the Company has the potential to realize benefits of appreciation
in the value of the underlying real estate if the property is sold. Central
Parking assumes complete responsibility for all aspects of the property,
including all structural, mechanical, or electrical maintenance or repairs and
property taxes.
Parking revenues from leased facilities amounted to $136.2 million and
$140.9 million for the three months ended June 30, 2001 and 2000 respectively,
and $400.2 million and $420.7 million for the nine months ended June 30, 2001
and 2000, respectively. Parking revenues from leased facilities accounted for
88.2% and 87.9% of total parking revenues in the three months ended June 30,
2001 and 2000, respectively, and 88.0% and 88.1% of total parking revenues for
the nine months ended June 30, 2001 and 2000, respectively. Leases generally
provide for a contractually established payment to the facility owner, which is
a fixed annual amount, a percentage of gross revenues, or a combination. As a
result, Central Parking's revenues and profits in its lease arrangements are
dependent upon the performance of the facility. Leased facilities require a
longer commitment and a larger capital investment by Central Parking than
managed facilities but generally provide a more stable source of revenue and a
greater opportunity for long-term revenue growth. Under its leases, the Company
is typically responsible for all facets of the parking operations, except for
structural, mechanical, or electrical maintenance or repairs. Lease arrangements
are typically for terms of three to ten years, with renewal options.
Management contract revenues amounted to $24.9 million and $26.0 million
for the three months ended June 30, 2001 and 2000, respectively and $76.0
million and $76.7 million for the nine months ended June 30, 2001 and 2000,
respectively. Management contract revenues consist of management fees (both
fixed and percentage of revenues) and fees for ancillary services such as
insurance, accounting, equipment leasing and consulting. The cost of management
contracts includes insurance premiums and claims and other indirect overhead.
The Company's responsibilities under a management contract as a facility manager
include hiring, training and staffing parking personnel, and providing
collections, accounting, record keeping, insurance and facility marketing
services. Generally, Central Parking is not responsible under its management
contracts for structural, mechanical, or electrical maintenance or repairs, or
for providing security or guard services or for paying property taxes. The
typical management contract is for a term of one to three years and generally is
renewable for successive one-year terms, but is cancelable by the property owner
on short notice.
The Company's clients have the option of obtaining insurance on their own
or having Central Parking provide insurance as part of the services provided
under the management contract. Because of its size and claims experience, the
Company can purchase such insurance at discounts to comparable market rates and,
management believes, at lower rates than the Company's clients can generally
obtain on their own.
As of June 30, 2001, Central Parking operated 1,870 parking facilities
through management contracts, leased 1,992 parking facilities, and owned 221
parking facilities, either independently or in joint ventures with third
parties.
THREE MONTHS ENDED JUNE 30, 2001 COMPARED TO THREE MONTHS ENDED JUNE 30, 2000
Parking revenues for the third quarter of fiscal 2001 decreased to $154.3
million from $160.4 million in the third quarter of fiscal 2000, a decrease of
$6.1 million, or 3.8%. The decrease is primarily a result of the Company
experiencing a net decline of 369 leased and owned locations since June 30, 2000
(245 locations added, offset by 614 locations lost). The decline in locations
is due to a variety of factors including the sale or closure of underperforming
locations and the loss of locations in the ordinary course of business.
Revenues from foreign operations amounted to approximately $9.5 million and $9.0
million for the quarters ended June 30, 2001 and 2000, respectively.
Management contract revenues for the third quarter of fiscal 2001 decreased
to $24.9 million from $26.0 million in the same period of fiscal 2000, a
decrease of $1.1 million or 4.1%. The slight decrease resulted from loss of
locations in the ordinary course of business.
Cost of parking in the third quarter of 2001 decreased to $128.5 million
from $133.3 million in the third quarter of 2000, a decrease of $4.8 million or
3.6%. This decrease was due primarily to a reduction in rent and property
taxes of $2.5 million compared against the prior year period. The reduction in
rent and property taxes is a result of fewer locations as well as an increased
focus on expense control throughout the Company. Rent expense as a percentage
of parking revenues increased to 48.9% for the three months ended June 30, 2001
from 48.3% in the comparable prior year period. Cost of parking as a percentage
of parking revenues increased to 83.3% in the third quarter of fiscal 2001 from
83.1% in the third quarter of fiscal 2000.
Cost of management contracts in the third quarter of fiscal 2001 increased
to $11.2 million from $8.5 million in the comparable period in 2000, an increase
of $2.7 million or 31.7%. The increase in cost reflects higher medical and
workers' compensation claims by employees. Cost of management contracts as a
percentage of management contract revenue increased to 45.0% for the third
quarter of 2001 from 32.7% for the same period in 2000, due to the increase in
the aforementioned items.
General and administrative expenses increased to $17.4 million for the
third quarter of fiscal 2001 from $16.8 million in the third quarter of fiscal
2000, an increase of $0.6 million or 3.4%. This increase is due to additional
depreciation from certain computer systems which began in the fourth quarter of
fiscal 2000. General and administrative expenses as a percentage of total
revenues increased to 9.7% for the third quarter of fiscal 2001 compared to 9.0%
for the third quarter of fiscal 2000.
Goodwill and non-compete amortization remained constant at $3.0 million for
the third quarter of fiscal 2001 and the third quarter of fiscal 2000.
Net property-related losses for the three months ended June 30, 2001 were
$3.1 million, including a $4.0 million charge for early termination of an
unfavorable lease and a $0.2 million charge for impairment of leasehold
improvements, offset by $1.1 million of routine gains on disposals of property
and equipment. Net property-related losses for the three months ended June 30,
2000 were $0.9 million and comprised losses on routine disposals of property and
equipment.
Interest income decreased to $1.4 million for the third quarter of fiscal
2001 from $1.8 million in the third quarter of fiscal 2000, a decrease of $0.4
million, or 24.7%. The decrease in interest income is a result of the retirement
of a $10.3 million note during the fourth quarter of fiscal 2000.
Interest expense and dividends on Company-obligated mandatorily redeemable
convertible securities of a subsidiary trust decreased to $6.2 million for the
third quarter of fiscal 2001 from $8.3 million in the third quarter of fiscal
2000, a decrease of $2.1 million or 25.4%. This decrease in interest expense was
primarily attributable to the lower amount of overall debt outstanding during
the current quarter. The weighted average balance outstanding under such credit
facilities and convertible securities was $394.6 million during the quarter
ended June 30, 2001, at a weighted average interest rate of 5.8% compared to
$454.9 million during the quarter ended June 30, 2000 at an average interest
rate of 6.9%.
Equity in partnership and joint venture earnings decreased in the third
quarter of fiscal 2001 to $1.5 million from $6.4 million for the same period in
the prior year, a decrease of $4.9 million, or 76.6%. The decrease was
primarily due to a $5.0 million gain recognized in the third quarter of fiscal
2000 resulting from the liquidation of property held by one of the Company's
unconsolidated partnerships.
Income taxes decreased to $5.0 million for the third quarter of fiscal 2001
from $8.3 million in the third quarter of fiscal 2000, a decrease of $3.3
million or 39.8%. The effective tax rate for the third quarter of fiscal 2001
was 42.6% compared to 36.0% for the third quarter of fiscal 2000. The increase
in the effective tax rate is attributable to an increase in nondeductible
goodwill as a percentage of income before taxes.
NINE MONTHS ENDED JUNE 30, 2001 COMPARED TO NINE MONTHS ENDED JUNE 30, 2000
Parking revenues for the first nine months of fiscal 2001 decreased to
$454.8 million from $477.6 million in the first nine months of fiscal 2000, a
decrease of $22.8 million, or 4.8%. The decrease primarily results from a
decline in the number of leased locations, including certain facilities that are
now operated as management locations. Revenues from foreign operations amounted
to approximately $25.7 million and $24.9 million for the nine-month periods
ended June 30, 2001 and 2000, respectively.
Management contract revenues for the first nine months of fiscal 2001 were
largely unchanged at $76.0 million, decreasing from $76.7 million in the same
period of fiscal 2000, a decrease of $0.7 million or 1.0%.
Cost of parking in the first nine months of 2001 decreased to $379.2
million from $400.0 million in the first nine months of 2000, a decrease of
$20.8 million or 5.2%. This decrease was due primarily to decreases in rent and
payroll expense resulting from fewer locations. Rent expense decreased $14.6
million to $218.4 million in the first nine months of 2001 compared to $233.0
million in the first nine months of 2000. Rent as a percentage of parking
revenues decreased to 48.0% in the first nine months of 2001 from 48.8% in the
same period of 2000. Payroll decreased $7.6 million in the nine-month period
ended June 30, 2001 over the same period in 2000. Cost of parking as a
percentage of parking revenues decreased to 83.4% in the first nine months of
fiscal 2001 from 83.8% in the first nine months of fiscal 2000.
Cost of management contracts in the first nine months of fiscal 2001
increased to $31.2 million from $25.1 million in the comparable period in 2000,
an increase of $6.1 million or 24.1%. The increase in cost reflects higher
medical and workers' compensation claims by employees, both in total and as a
percentage of management contract revenue. Cost of management contracts as a
percentage of management contract revenue increased to 41.1% for the first nine
months of fiscal 2001 from 32.8% for the same period in 2000, primarily due to
the aforementioned items.
General and administrative expenses, excluding amortization of goodwill and
non-compete agreements, decreased to $51.1 million for the first nine months of
fiscal 2001 from $56.4 million in the first nine months of 2000, a decrease of
$5.3 million or 9.4%. This decrease is due primarily to $3.1 million of
additional depreciation in the prior year resulting from the adoption of a
shorter life on certain Allright related computer assets. General and
administrative expenses, as a percentage of total revenues decreased to 9.6% for
the first nine months of fiscal 2001 compared to 10.2% for the first nine months
of fiscal 2000.
Goodwill and non-compete amortization for the nine-month period ended June
30, 2001 remained constant at $9.0 million compared to the same period in 2000.
The Company incurred $3.7 million of merger related expenses on a pretax
basis during the nine months ended June 30, 2000 that were reported as operating
expenses. Included in these costs are approximately $1.3 million of legal,
accounting, and consulting fees; $1.1 million related to employment agreements
and severance; and the balance of $1.3 million in travel, supplies, printing and
other out of pocket expenses. The costs which were directly attributable to the
merger and are incremental to the combined companies were recognized when
incurred. No such expenses have been incurred in the current fiscal year.
Net property-related losses for the nine months ended June 30, 2001
amounted to $2.6 million compared to net gains of $2.2 million for the
comparable period in fiscal 2000. Gains on sale of property of $6.6 million were
offset by impairment charges for leasehold improvements and intangible assets
totaling $4.0 million and lease termination charges of $5.2 million during the
nine months ended June 30, 2001. For the same period in fiscal 2000, gains on
sale of property of $2.7 million were offset by impairment charges for contract
rights of $0.5 million.
Interest income decreased to $4.3 million for the first nine months of
fiscal 2001 from $5.2 million in the first nine months of fiscal 2000, a
decrease of $0.9 million, or 16.7%. The decrease in interest income is a result
of the retirement of a $10.3 million note during the fourth quarter of fiscal
2000.
Interest expense and dividends on Company-obligated mandatorily redeemable
convertible securities of a subsidiary trust decreased to $20.9 million for the
first nine months of fiscal 2001 from $24.5 million in the first nine months of
fiscal 2000, a decrease of $3.6 million or 14.5%. This decrease in interest
expense was primarily attributable to lower overall outstanding debt balances
during the period. The weighted average balance outstanding under such credit
facilities and convertible securities was $400.5 million during the nine-month
period ended June 30, 2001, at a weighted average interest rate of 6.5% compared
to $463.2 million during the same period ended June 30, 2000 at an average
interest rate of 6.8%.
Equity in partnership and joint venture earnings decreased in the first
nine months of fiscal 2001 to $4.2 million from $9.1 million for the same period
in the prior year, a decrease of $4.9 million, or 54.4%. The decrease was
primarily due to a $5.0 million gain recognized in the third quarter of fiscal
2000 resulting from the liquidation of property held by one of the Company's
unconsolidated partnerships.
Income taxes excluding the extraordinary item and cumulative effect of
accounting change, decreased to $17.7 million for the first nine months of
fiscal 2001 from $18.9 million in the first nine months of 2000, a decrease of
$1.2 million or 6.2%. The effective tax rate for the first nine months of fiscal
2001 was 41.3%, compared to 38.1% for the first nine months of fiscal 2000. The
increase in the effective tax rate is attributable to an increase in
nondeductible goodwill as a percentage of income before taxes.
LIQUIDITY AND CAPITAL RESOURCES
Operating activities for the nine months ended June 30, 2001 provided net
cash of $32.3 million, compared to $62.4 million of cash provided by operating
activities for the nine months ended June 30, 2000. Net earnings of $24.9
million and depreciation and amortization of $35.7 million, offset by decreases
in accounts payable and accrued expenses of $13.7 million and income taxes
payable of $6.9 million and increases in other assets of $7.1 million, account
for the majority of the cash provided by operating activities during the first
nine months of fiscal 2001.
Investing activities for the nine months ended June 30, 2001 used net cash
of $0.8 million, compared to $23.2 million of net cash used for investing
activities for the same period in 2000. Proceeds of $21.3 million from the
disposition of property and equipment, offset by the purchase of property,
equipment, leasehold improvements, and contract rights of $24.6 million account
for the majority of the cash used by investing activities in the first nine
months of fiscal 2001. Purchase of property, equipment, leasehold improvements
and contract rights of $50.6 million, partially offset by proceeds from sales of
property of $20.8 million and repayments of advances to partnerships and joint
ventures of $5.9 million accounted for the majority of cash used by investing
activities during the first nine months of fiscal 2000.
Financing activities for the nine months ended June 30, 2001 used net cash
of $39.9 million, compared to $46.7 million in the same period in 2000.
Principal repayments on notes payable and capital lease obligations of $42.5
million and the repurchase of $10.9 million of common stock, offset by net
borrowings under the revolving credit facility of $16.1 million account for the
majority of the cash used by financing activities during the nine months ended
June 30, 2001. Net payments under the revolving credit agreement of $34.5
million and repurchase of common stock of $10.3 million, partially offset by
proceeds from the issuance of notes payable of $13.3 million account for the
majority of the cash used by financing activities during the nine months ended
June 30, 2000.
Depending on the timing and magnitude of the Company's future investments
(either in the form of leased or purchased properties, joint ventures, or
acquisitions), the working capital necessary to satisfy current obligations is
anticipated to be generated from operations and from Central Parking's credit
facility over the next twelve months. In the ordinary course of business,
Central Parking is required to maintain and, in some cases, make capital
improvements to the parking facilities it operates.
The Allright Registration Rights Agreement, as noted under the caption
"Risk Factors" in the Management's Discussion and Analysis of Financial
Condition and Results of Operations section of the Company's Report on Form 10-K
for the year ended September 30, 2000, provides certain limitations and
restrictions upon Central Parking's ability to issue new shares of Central
Parking common stock. Until certain shareholders of Central Parking have
received at least $350 million from the sale of Central Parking common stock in
either registered offerings or otherwise, Central Parking cannot sell any shares
of its common stock on its own behalf, subject to certain exceptions. While
Central Parking does not expect this limitation to affect its working capital
needs, it could have an impact on Central Parking's ability to complete
significant acquisitions. The decreased market value of Central Parking's common
stock also could have an impact on Central Parking's ability to complete
significant acquisitions or raise additional capital.
Future Cash Commitments
On January 18, 2000, the Company's board of directors authorized the
repurchase of up to $50 million in outstanding shares of the Company's common
stock. The Company's bank lenders subsequently approved the repurchase on
February 14, 2000. Subject to availability, the repurchases may be made from
time to time in open market transactions or in privately negotiated off-market
transactions at prevailing market prices that the Company deems appropriate. As
of June 30, 2001 the Company had repurchased 1.4 million shares at a total cost
of $25.5 million.
The Company routinely makes capital expenditures to maintain and enhance
customer service at parking facilities under its control. Capital expenditures
for the nine months ended June 30, 2001 were $22.6 million.
Credit Facility
On March 19, 1999, the Company established a new credit facility (the
"Credit Facility") providing for an aggregate availability of up to $400 million
consisting of a five-year $200 million revolving credit facility including a
sub-limit of $25 million for standby letters of credit, and a $200 million
five-year term loan. The Credit Facility bears interest at LIBOR plus a grid
based margin dependent upon Central Parking achieving certain financial ratios.
The amount outstanding under the Company's Credit Facility as of June 30, 2001
was $244.0 million with a weighted average interest rate of 4.9%, including the
principal amount of the term loan of $137.5 million which is being repaid in
quarterly payments of $12.5 million through March 2004. The Credit Facility
contains covenants including those that require the Company to maintain certain
financial ratios, restrict further indebtedness and limit the amount of
dividends paid. The aggregate availability under the Credit facility was $68.5
million at June 30, 2001.
Convertible Trust Issued Preferred Securities and Equity Offerings
On March 18, 1998, the Company completed an offering of 2,137,500 shares of
common stock. The Company received net proceeds from the offering of $89.1
million. Concurrent with the common stock offering, the Company created the
Trust which completed a private placement of 4,400,000 shares at $25.00 per
share of 5.25% convertible trust issued preferred securities pursuant to an
exemption from registration under the Securities Act of 1933, as amended. The
Preferred Securities represent preferred undivided beneficial interests in the
assets of Central Parking Finance Trust, a statutory business trust formed under
the laws of the State of Delaware. The Company owns all of the common securities
of the Trust. The Trust exists for the sole purpose of issuing the Preferred
Securities and investing the proceeds thereof in an equivalent amount of 5.25%
Convertible Subordinated Debentures ("Convertible Debentures") of the Company
due 2028. The net proceeds to the Company from the Preferred Securities private
placement were $106.0 million. Each Preferred Security is entitled to receive
cumulative cash distributions at an annual rate of 5.25% (or $1.312 per share)
and will be convertible at the option of the holder thereof into shares of
Company common stock at a conversion rate of 0.4545 shares of Company common
stock for each Preferred Security (equivalent to $55.00 per share of Company
common stock), subject to adjustment in certain circumstances. The Preferred
Securities do not have a stated maturity date but are subject to mandatory
redemption upon the repayment of the Convertible Debentures at their stated
maturity (April 1, 2028) or upon acceleration or earlier repayment of the
Convertible Debentures. The proceeds of the equity and preferred security
offerings were used to repay indebtedness.
The Company's consolidated balance sheets reflect the Preferred Securities
of the Trust as company-obligated mandatorily redeemable convertible securities
of subsidiary whose sole assets are convertible subordinated debentures of the
Parent.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
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Interest Rates
The Company's primary exposure to market risk consists of changes in interest
rates on variable rate borrowings. As of June 30, 2001, the Company had $244.0
million of variable rate debt outstanding under the Credit Facility priced at
LIBOR plus 87.5 basis points. The Company is required under the Credit Facility
to enter into interest rate protection agreements designed to limit the
Company's exposure to increase in interest rates. As of June 30, 2001, interest
rate protection agreements had been purchased to hedge $100 million of the
Company's variable rate debt. Please refer to the paragraph entitled Long-Term
Debt in the Notes to the Financial Statements for a description of the
individual interest rate protection agreements. With such agreements in place,
a 1% increase in market interest rates would result in an increase of
approximately $2.2 million in annual interest expense.
$137.5 million of the Credit Facility is payable in quarterly installments
of $12.5 million and $106.5 million in revolving credit loans are due in March
2004. The Company anticipates paying the scheduled quarterly payments out of
operating cash flow and, if necessary, will renew the revolving credit facility.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
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The ownership of property and provision of services to the public entails
an inherent risk of liability. Although the Company is engaged in routine
litigation incidental to its business, there is no legal proceeding to which the
Company is a party, which, in the opinion of management, will have a material
adverse effect upon the Company's financial condition, results of operations, or
liquidity. The Company carries liability insurance against certain types of
claims that management believes meets industry standards; however, there can be
no assurance that any future legal proceedings (including any judgments,
settlements or costs) will not have a material adverse effect on the Company's
financial condition, liquidity or results of operations.
In connection with the merger of Allright Holdings, Inc. with a subsidiary
of the Company, the Antitrust Division of the United States Department of
Justice (the "Antitrust Division") filed a complaint in U.S. District Court for
the District of Columbia seeking to enjoin the merger on antitrust grounds. In
addition, the Company received notices from several states, including Tennessee,
Ohio, Texas, Illinois, and Maryland, that the attorneys general of those states
were reviewing the merger from an antitrust perspective. Several of these states
also requested certain information relating to the merger and the operations of
Central and Allright in the form of civil investigative demands.
Central and Allright entered into a settlement agreement with the Antitrust
Division on March 16, 1999, under which the two companies agreed to divest a
total of 74 parking facilities in 18 cities, representing approximately 18,000
parking spaces. None of the states that reviewed the transaction from an
antitrust perspective became a party to the settlement agreement with the
Antitrust Division, and the Company believes that at least one of these states,
Tennessee, is still conducting a review of the operations of Central and
Allright. The Company has completed the divestiture of all of the facilities
required to be divested by the settlement agreement. The settlement agreement
provides that Central and Allright may not operate any of the divested
facilities for a period of two years following the divestiture of such facility.
Item 6. Exhibits and Reports on Form 8-K
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(a) Exhibits
2 Plan of Recapitalization, effective October 9, 1997 (Incorporated by
reference to Exhibit 2 to the Company's Registration Statement No. 33-95640
on Form S-1).
2.1 Agreement and Plan of Merger dated September 21, 1998, by and among the
Registrant, Central Merger Sub, Inc., Allright Holdings, Inc., Apollo Real
Estate Investment Fund II, L.P. and AEW Partners, L.P. (Incorporated by
reference to Exhibit 2.1 to the Company's Registration Statement No.
333-66081 on Form S-4 filed on October 21, 1998).
2.2 Amendment dated as of January 5, 1999, to the Agreement and Plan of Merger
dated September 21, 1998 by and among the Registrant, Central Merger Sub,
Inc., Allright Holdings, Inc., Apollo Real Estate Investment Fund II, L.P.
and AEW Partners, L.P. (Incorporated by reference to Exhibit 2.1 to the
Company's Registration Statement No. 333-66081 on Form S-4 filed on October
21, 1998, as amended).
2.3 Acquisition Agreement and Plan of Merger dated as of November 7, 1997, by
and between the Registrant and Kinney System Holding Corp and a subsidiary
of the Registrant (Incorporated by reference to the Company's Current
Report on Form 8-K filed on February 17, 1998).
3.1 (a) Amended and Restated Charter of the Registrant (Incorporated by
reference to Exhibit 4.1 to the Company's Registration Statement No.
333-23869 on Form S-3).
(b) Articles of Amendment to the Charter of Central Parking Corporation
increasing the authorized number of shares of common stock, par value $0.01 per
share, to one hundred million (Incorporated by reference to Exhibit 2 to the
Company's 10-Q for the quarter ended June 30, 1999).
3.2 Amended and Restated Bylaws of the Registrant (Incorporated by reference to
Exhibit 4.1 to the Company's Registration Statement No. 333-23869 on Form
S-3).
4.1 Form of Common Stock Certificate (Incorporated by reference to Exhibit 4.1
to the Company's Registration Statement No. 33-95640 on Form S-1).
4.4 (a) Registration Rights Agreement (the "Allright Registration Rights
Agreement") dated as of September 21, 1998 by and between the Registrant,
Apollo Real Estate Investment Fund II, L.P., AEW Partners, L.P. and Monroe
J. Carell, Jr., The Monroe Carell Jr.Foundation, Monroe Carell Jr. 1995
Grantor Retained Annuity Trust, Monroe Carell Jr. 1994 Grantor Retained
Annuity Trust, The Carell Children's Trust, The 1996 Carell Grandchildren's
Trust, The Carell Family Grandchildren 1990 Trust, The Kathryn Carell Brown
Foundation, The Edith Carell Johnson Foundation, The Julie Carell Stadler
Foundation, 1997 Carell Elizabeth Brown Trust, 1997 Ann Scott Johnson
Trust, 1997 Julia Claire Stadler Trust, 1997 William Carell Johnson Trust,
1997 David Nicholas Brown Trust and 1997 George Monroe Stadler Trust
(Incorporated by reference to Exhibit 4.4 to the Company's Registration
Statement No. 333-66081 filed on October 21, 1998).
4.4 (b) Amendment dated January 5, 1999 to the Allright Registration Rights
Agreement (Incorporated by reference to Exhibit 4.4.1 to the Company's
Registration Statement No. 333-66081 filed on October 21, 1998, as
amended).
4.4 (c) Second Amendment dated February 1, 2001 to the Allright Registration
Rights Agreement. (Incorporated by reference to Exhibit 4.6 to the
Company's Registration Statement No. 333-54914 on Form S-3 filed on
February 2, 2001)
4.5 Indenture dated March 18, 1998 between the registrant and Chase Bank of
Texas, National Association, as Trustee regarding up to $113,402,050 of
5-1/4 % Convertible Subordinated Debentures due 2028. (Incorporated by
reference to Exhibit 4.5 to the Registrant's Registration Statement No.
333-52497 on Form S-3).
4.6 Amended and Restated Declaration of Trust of Central Parking Finance Trust
dated as of March 18, 1998. (Incorporated by reference to Exhibit 4.5 to
the Registrant's Registration Statement No. 333-52497 on Form S-3).
4.7 Preferred Securities Guarantee Agreement dated as of March 18, 1998 by and
between the Registrant and Chase Bank of Texas, national Association as
Trustee (Incorporated by reference to Exhibit 4.7 to the Registrant's
Registration Statement No. 333-52497 on Form S-3).
4.8 Common Securities Guarantee Agreement dated March 18, 1998 by the
Registrant. (Incorporated by reference to Exhibit 4.9 to 333-52497 on Form
S-3).
10.1 Executive Compensation Plans and Arrangements
(a) 1995 Incentive and Nonqualified Stock Option Plan for Key Personnel
(Incorporated by reference to Exhibit 10.1 to the Company's Registration
Statement No. 33-95640 on Form S-1).
(b) Amendment to the 1995 Incentive and Nonqualified Stock Option Plan for
Key Personnel increasing the number of shares licensed for issuance under
the plan to 3,817,500. (Incorporated by reference to Exhibit 10.1 to the
Company's Annual Report of Form 10-K for the period ended September 30,
2000)
(c) Form of Option Agreement under Key Personnel Plan (Incorporated by
reference to Exhibit 10.2 to the Company's Registration Statement No.
33-95640 on Form S-1).
(d) 1995 Restricted Stock Plan (Incorporated by reference to Exhibit 10.5.1
to the Company's Registration Statement No. 33-95640 on Form S-1.)
(e) Form of Restricted Stock Agreement (Incorporated by reference to
Exhibit 10.5.2 to the Company's Registration Statement No.33-95640 on Form
S-1.)
(f) Form of Employment Agreements with Executive Officers (Incorporated by
reference to Exhibit 10.7 to the Company's Registration Statement No.
33-95640 on Form S-1.)
(g) Monroe J. Carell, Jr. Employment Agreement (Incorporated by reference
to Exhibit 10.8 to the Company's Registration Statement No. 33-95640 on
Form S-1.)
(h) Monroe J. Carell, Jr. Revised Deferred Compensation Agreement, as
amended (Incorporated by reference to Exhibit 10.9 to the Company's
Registration Statement No.33-95640 on Form S-1.)
(i) Performance Unit Agreement between Central Parking Corporation and
James H. Bond (Incorporated by reference to Exhibit 10.11.1 to the
Company's Registration Statement No. 33-95640 on Form S-1.)
(j) Modification of Performance Unit Agreement of James H. Bond
(Incorporated by reference to Exhibit 10.1 (j) to the Company's Annual
Report on Form 10-K filed on December 27, 1997).
(k) Second modification of Performance Unit Agreement of James H. Bond.
(Filed herewith).
(l) James J. Hagan Employment Agreement, dated June 12, 2000. (Incorporated
by reference to Exhibit 10.1 to the Company's Report on Form 10-K for the
period ended September 30, 2000.)
(m) Deferred Stock Unit Plan (Incorporated by reference to Exhibit 10.1 to
the Company's Annual Report on Form 10-K for the period ended September 30,
1998).
(n) EPS Compensation Program for Senior Executives. (Incorporated by
reference to Exhibit 10.1 (m) of the Company's Report on Form 10-K for the
period ended September 30, 1999).
(o) William J. Vareschi Employment Agreement dated as of February 28, 2001.
(Filed herewith)
(p) James H. Bond Employment Agreement dated as of may 31, 2001. (Filed
herewith)
(q) Emanuel J. Eads Employment Agreement dated as of October 1, 2000.
(Filed herewith)
(r) Gregory A. Susick Employment Agreement dated as of October 1, 2000.
(Filed herewith)
(s) Jeff L. Wolfe Employment Agreement dated as of October 1, 2000. (Filed
herewith)
10.2 (a) 1995 Nonqualified Stock Option Plan for Directors (Incorporated by
reference to Exhibit 10.3 to the Company's Registration Statement No.
33-95640 on Form S-1.)
(b) Amendment to the 1995 Nonqualified Stock Option Plan for Directors
increasing the number of shares reserved for issuance under the plan to
475,000. (Incorporated by reference to Exhibit 10.2 to the Company's Annual
Report on Form 10-K for the period ended September 30, 2000.)
10.3 Form of Option Agreement under Directors plan (Incorporated by reference to
Exhibit 10.4 to the Company's Registration Statement No. 33-95640 on Form
S-1.)
10.4 Form of Indemnification Agreement for Directors (Incorporated by reference
to Exhibit 10.12 to the Company's Registration Statement No. 33-95640 on
Form S-1.)
10.5 Indemnification Agreement for Monroe J. Carell, Jr. (Incorporated by
reference to Exhibit 10.13 to the Company's Registration Statement No.
33-95640 on Form S-1.)
10.6 Form of Management Contract (Incorporated by eference to Exhibit 10.14 to
the Company's Registration Statement No. 33-95640 on Form S-1.)
10.7 Form of Lease (Incorporated by reference to Exhibit 10.15 to the Company's
Registration Statement No. 33-95640 on Form S-1.)
10.8 1998 Employee Stock Purchase Plan (Incorporated by reference to Exhibit
10.16 to the Company's Registration Statement No. 33-95640 on Form S-1.)
10.9 Exchange Agreement between the Company and Monroe J. Carell, Jr.
(Incorporated by reference to Exhibit 10.18 to the Company's Registration
Statement No. 33-95640 on Form S-1.)
10.10 $400 Million Credit Agreement dated as of March 19, 1999 by and among
various banks with Bank of America, N.A., as Agent, and Central Parking
Corporation and certain affiliates. (Incorporated by reference to Exhibit
10.11 of the Company's Report on Form 10-K for the period ended September
30, 1999.)
10.11 Letter Amendment dated as of June 25, 1999 to Credit Agreement dated as of
March 19, 1999, by and among various banks with Bank of America, N.A., as
Agent, and Central Parking Corporation and certain affiliates.
(Incorporated by reference to Exhibit 10.11 of the Company's Report on Form
10-K for the period ended September 30, 1999.)
10.12 Letter Amendment dated as of October 27, 1999 to Credit Agreement dated as
of March 19, 1999, by and among various banks with Bank of America, N.A.,
as Agent, and Central Parking Corporation and certain affiliates.
(Incorporated by reference to Exhibit 10.11 of the Company's Report on Form
10-K for the period ended September 30, 1999.)
10.13 Form of Amendment dated as of December 28, 1999 to $400 million Credit
Agreement dated as of March 19, 1999, by and among various banks with Bank
of America, N.A., as Agent, and Central Parking Corporation and certain
affiliates. (Incorporated by reference to Exhibit 10.11 of the Company's
Report on Form 10-K for the period ended September 30, 1999.)
10.14 Amended and Restricted Credit Agreement dated as of February 14, 2000, by
and among various banks, with Bank of America, N.A., as Agent and Central
Parking Corporation and certain affiliates. (Incorporated by reference to
the Company's Report of Form 10-Q for the quarter ended June 30, 2000.)
10.15 Amended and Restated Credit Agreement dated as of June 16, 2000, by and
among various banks, with Bank F America, N.A. as Agent and Central Parking
Corporation and certain affiliates. (Incorporated by reference to Exhibit
10.15 to the Company's Annual Report on Form 10-K for the period ended
September 30, 2000.)
10.16 Consultancy Agreement dated as of January 21, 1997 between Central Parking
System, Inc. and Lowell Harwood (Incorporated by reference to Exhibit
(c)(4) to the Company's Tender Offer Statement on Schedule 14D-1 filed
December 13, 1996).
10.17 Consulting Agreement dated as of February 12, 1998, by and between Central
Parking Corporation and Lewis Katz. (Incorporated by reference to Exhibit
10.20 of the Company's Report on Form 10-K for the period ended September
30, 1999.)
10.18 Limited Partnership Agreement dated as of August 11, 1999, by and between
CPS of the Northeast, Inc. and Arizin Ventures, L.L.C. (Incorporated by
reference to Exhibit 10.21 of the Company's Report on Form 10-K for the
period ended September 30, 1999.)
10.19 Registration Rights Agreement dated as of February 12, 1998, by and among
Central Parking Corporation, Lewis Katz and Saul Schwartz. (Incorporated by
reference to Exhibit 10.22 of the Company's Report on Form 10-K for the
period ended September 30, 1999.)
10.20 Shareholders' Agreement and Agreement Not to Compete by and among Central
Parking Corporation, Monroe J. Carell, Jr., Lewis Katz and Saul Schwartz
dated as of February 12, 1998. (Incorporated by reference to Exhibit 10.23
of the Company's Report on Form 10-K for the period ended September 30,
1999.)
10.21 Lease Agreement dated as of October 6, 1995, by and between The Carell
Family LLC and Central Parking System of Tennessee, Inc. (Alloway Parking
Lot). (Incorporated by reference to Exhibit 10.24 of the Company's Report
on Form 10-K for the period ended September 30, 1999.)
10.22 First Amendment to Lease Agreement dated as of July 29, 1997, by and
between The Carell Family LLC and Central Parking System of Tennessee, Inc.
(Alloway Parking Lot). (Incorporated by reference to Exhibit 10.25 of the
Company's Report on Form 10-K for the period ended September 30, 1999.)
10.23 Lease Agreement dated as of October 6, 1995 by and between The Carell
Family LLC and Central Parking System of Tennessee, Inc. (Second and Church
Parking Lot). (Incorporated by reference to Exhibit 10.26 of the Company's
Report on Form 10-K for the period ended September 30, 1999.)
10.24 First Amendment to Lease Agreement dated as of October 6, 1995, by and
between The Carell Family LLC and Central Parking System of Tennessee, Inc.
(Second and Church Parking Lot). (Incorporated by reference to Exhibit
10.27 of the Company's Report on Form 10-K for the period ended September
30, 1999.)
10.25 Prospectus and offering document for 2,625,000 shares of Common Stock
dated February 17, 1998. (Incorporated by reference to the Company's
Registration Statement No. 233-23869 on Form S-3).
10.26 Transaction Support Agreement by Monroe J. Carell, Jr., the Registrant,
Kathryn Carell Brown, Julia Carell Stadler and Edith Carell Johnson to
Allright Holdings, Inc., Apollo Real Estate Investment Fund II, L.P. and
AEW Partners, L.P. dated September 21, 1998. (Incorporated by reference to
Exhibit 2.1 to the Company's Registration Statement No. 333-66081 filed on
October 23, 1998).
10.30 Form of Transaction Support Agreement by certain shareholders of the
Registrant to Allright Holdings, Inc., Apollo Real Estate Investment Fund
II, L.P., and AEW Partners, L.P., dated September 21, 1998. (Incorporated
by reference to Exhibit 2.1 to the Company's Registration Statement No.
333-66081 filed on October 23, 1998).
10.31 Form of Transaction Support Agreement by certain shareholders of Allright
Holdings, Inc. to the Registrant and Central Merger Sub, Inc. dated
September 21, 1998. (Incorporated by reference to Exhibit 2.1 to the
Company's Registration Statement No. 333-66081 filed on October 23, 1998).
(b) Reports on Form 8-K
On May 29, 2001, the Company filed a current report on form 8-K announcing
the hiring of Mr. Hiram A. Cox as Chief Financial Officer, incorporating the
text of a press release on that date.
On July 18, 2001, the Company filed a current report on form 8-K announcing
its forecasted operating results for the third quarter of fiscal 2001,
incorporating the text of a press release dated July 17, 2001.
On August 13, 2001, the Company filed a current report on form 8-K
announcing the acquisition of USA Parking Systems, incorporating the text of a
press release dated August 8, 2001.
On August 13, 2001, the Company filed a current report on form 8-K
announcing the results for the third quarter of fiscal 2001, incorporating the
text of a press release dated August 9, 2001.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
CENTRAL PARKING CORPORATION
Date: August 31, 2001 By: /s/ Hiram A. Cox
----------------- -------------------
Hiram A. Cox
Senior Vice President and
Chief Financial Officer
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 in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
Senior Vice President and
/s/ Hiram A. Cox Chief Financial Officer August 31, 2001
- --------------------------
Hiram A. Cox
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned party duly authorized.