Document:

EX-10.36

EXHIBIT 10.36

THE GENUINE PARTS COMPANY

SUPPLEMENTAL RETIREMENT PLAN

(As Amended and Restated Effective as of January 1, 2009)

ARTICLE ONE — INTRODUCTION

	1.01	 	Establishment of Plan.
	 
	 	 	The Board of Directors of Genuine Parts Company (“Genuine Parts”) has
determined that it is in the best interest of Genuine Parts and its
subsidiaries (collectively the “Employer”) to establish a
nonqualified supplemental retirement plan for certain executives of
the Employer. Accordingly, the Board established The Genuine Parts
Company Supplemental Retirement Plan effective as of January 1, 1991.
The Genuine Parts Company Supplemental Retirement Plan was most
recently amended and restated effective as of January 1, 2003 and was
thereafter amended various times. Effective January 1, 2009, the
Plan is continued in an amended and restated form as set forth in
this document (the “Plan”).
	 
	 	 	This Plan is intended to be a plan maintained by the Employer solely
for the purpose of providing benefits for certain employees in excess
of the limitations on benefits imposed by Sections 401(a)(17) and 415
of the Internal Revenue Code of 1986 (the “Code”) and is also
intended to be a plan that is unfunded and is maintained by Genuine
Parts for the purpose of providing deferred compensation for a select
group of management or highly compensated employees.
	 
	 	 	Although this Plan is effective on January 1, 2009, the Plan was
adopted on or before December 31, 2008 to incorporate changes
required by Code Section 409A and in accordance with transition
relief set forth in Revenue Ruling 2007-86 and other applicable
transition authority.
	 
	 	 	Effective at midnight on December 31, 2008, this Plan is amended to
freeze participation. No new Key Employee (as defined in Section
2.01) may commence participation in this Plan on or after January 1,
2009.
	 
	1.02	 	Incorporation of Pension Plan.
	 
	 	 	The terms of the Genuine Parts Company Pension Plan, as amended and
restated effective January 1, 2006 (the “Pension Plan”) are hereby
incorporated in this Plan by reference. Unless otherwise indicated
herein, the provisions of any future amendments to and restatements
of the Pension Plan shall also be incorporated in this Plan by
reference. Unless indicated otherwise, capitalized terms used in
this Plan shall have the meaning given those terms in the Pension
Plan.

ARTICLE TWO — PARTICIPATION

	2.01	 	Eligibility.
	 
	 	 	Except as provided in Section 2.02, any employee of the Employer
whose annual, regular Earnings were expected to be equal to or
greater than the compensation limits of Code Section 401(a)(17) for
such year ($245,000 in 2009) were eligible to participate in this
Plan (“Key Employee”). Upon becoming eligible to participate, the
Key Employee was required to complete and execute a Joinder Agreement
in a form satisfactory to the Pension and Benefits Committee of
Genuine Parts Company (the “Committee”). Such Joinder Agreement was
required to be completed no later than January 30 following the
calendar year in which the Key Employee first accrues a benefit under
this Plan. If the Key Employee failed to timely complete the Joinder Agreement, the Key
Employee was prohibited from accruing a benefit under this Plan until the 

 

 

	 	 	first day of the
calendar year after the completion of the Joinder Agreement. Even though a Key Employee may
be a participant in this Plan, he or she shall not be entitled to any benefit hereunder
unless and until his or her benefits under the Pension Plan are reduced due to the
application of either Section 401(a)(17) or Section 415 of the Code.

	 	 	Effective at midnight on December 31, 2008, no new Key Employees may participate in this
Plan. In other words, no Key Employee may begin participation in this Plan on or after
January 1, 2009. All Key Employees who began participation in this Plan effective January
1, 2008 signed a Joinder Agreement prior to December 31, 2008. No Joinder Agreements may be
executed to join this Plan on or after December 31, 2008.
	 
	2.02	 	Additional Rules on Eligibility.

	 	(a)	 	A Key Employee shall not accrue a benefit for any year in which the Key
Employee’s annual, regular Earnings are less than the compensation limits of Code
Section 401(a)(17). Nevertheless, the Key Employee shall continue to participate in
the Plan and shall again accrue a benefit under this Plan during the calendar year in
which the Key Employee’s Earnings exceed the Earnings limit in Section 2.01.
	 
	 	(b)	 	A Key Employee shall be notified in writing by the Committee (or its designee)
of his or her initial eligibility to participate in the Plan no later than January 30
following the calendar year in which the Key Employee first accrues a benefit under the
Plan. Unless notified in writing by the Committee (or its designee) as described in
the preceding sentence, a Key Employee shall not be eligible to participate in the Plan
and shall not accrue a benefit under this Plan. Furthermore, the Committee (or its
designee) may prohibit any Key Employee from accruing future benefits under this Plan
by notifying such Key Employee in writing that his or her accruals under this Plan
shall cease. Such freezing of future accruals shall be effective for the next calendar
year following the date the written notice is mailed or hand delivered to the Key
Employee.

	2.03	 	Definition of Earnings.
	 
	 	 	For purposes of this Plan, the term “Earnings” shall (except as
modified below) have the same meaning given such term in the Pension
Plan. Unlike the Pension Plan, however, Earnings shall include
salary, bonus or other compensation that the Company would otherwise
have been paid to a Key Employee but for the Key Employee’s election
to defer the receipt of such salary, bonus or other compensation
pursuant to a Company sponsored deferred compensation program
(“Deferred Compensation”). A Key Employee’s Deferred Compensation
shall not be included in Earnings in the year such Deferred
Compensation is paid to the Key Employee.

ARTICLE THREE — VESTING

	3.01	 	Vesting.

	 	(a)	 	Vesting on or after January 1, 2009. A Key Employee who participates
in the Plan shall become 100% vested in his or her Supplemental Retirement Income under
this Plan (as provided in Article Five and Article Six) on the earliest of the
following dates:

	 	(1)	 	The Key Employee attains his or her Normal Retirement Date
prior to his or her Separation from Service;
	 
	 	(2)	 	The Key Employee attains age 55 and completes fifteen years of
Retirement Eligibility Service prior to his or her Separation from Service;

 

 

	 	(3)	 	The Key Employee incurs a Permanent Disability prior to his or
her Separation from Service;
	 
	 	(4)	 	The Key Employee dies prior to his or her Separation from
Service;
	 
	 	(5)	 	A Change in Control occurs prior to the Key Employee’s
Separation from Service (see Article Nine); and
	 
	 	(6)	 	The Plan is terminated prior to the Key Employee’s Separation
from Service (see Section 10.08).

	 	(b)	 	Vesting prior to January 1, 2009. In general, prior to January 1,
2009, a Key Employee who had a Separation from Service prior to the earlier of his or
her (i) Normal Retirement Date or (ii) attainment of age 55 and completion of fifteen
years of Credited Service forfeited his or her Supplemental Retirement Income under
this Plan.
	 
	 	(c)	 	Forfeiture. If a Key Employee has a Separation from Service for any
reason prior to becoming vested as provided in this Article Three, such Key Employee
shall forfeit his or her entire benefit under this Plan. No payment of any kind shall
be made under this Plan to any Key Employee who has a Separation from Service prior to
becoming vested under this Plan.

ARTICLE FOUR -— PENSION CHOICE 

	4.01	 	Background on Pension Choice.
	 
	 	 	In general, during August 2008, the Company provided Rule of 70 Employees (as defined in the
Pension Plan) a choice regarding on-going participation in the Pension Plan. The Company
allowed Rule of 70 Employees to elect one of two alternatives. Option one allowed a Rule of
70 Employee to continue full, active participation in the Pension Plan. In general, option
two provides that a Rule of 70 Employee will have his or her Credited Service under the
Pension Plan frozen effective at midnight on December 31, 2008. On the other hand, Average
Earnings and Anticipated Social Security Benefit are not frozen under the Pension Plan for a
Rule of 70 Employee electing option two. A Rule of 70 Employee who did not make a choice by
the applicable deadline was deemed to have elected option one. Whether a Rule of 70
Employee elected or was deemed to have elected option one or option two was determined in
August 2008 in accordance with the provisions of the Pension Plan and cannot change
thereafter.
	 
	 	 	If a Key Employee is not a Rule of 70 Employee, such Key Employee was not given a choice
between option one and option two. Instead, such Key Employee’s Credited Service under the
Pension Plan was automatically frozen as of midnight on December 31, 2008. As with a Rule
of 70 Employee who elected option two, this Key Employee’s Average Earnings and Anticipated
Social Security Benefits under the Pension Plan are not frozen.

	4.02	 	Credited Service under this Plan.
	 
	 	 	As noted above, Credited Service is frozen in the Pension Plan for a
Rule of 70 Employee electing option two and for a Key Employee who is
not a Rule of 70 Employee. Regardless, a Key Employee’s Credited
Service under this Plan is NOT frozen.

 

 

ARTICLE FIVE — SUPPLEMENTAL RETIREMENT INCOME

	5.01	 	Calculation of Supplement for a Rule of 70 Employee Electing Option One in the Pension
Plan.

	 	(a)	 	This Section 5.01 contains the benefit formula for a Key Employee who is also a
Rule of 70 Employee who elected option one (see Article Four). This Key Employee
continues to earn Credited Service under both the Pension Plan and this Plan. This
Article Five assumes the Key Employee has a Separation from Service on or after his or
her Normal or Delayed Retirement Date.
	 
	 	(b)	 	Each Key Employee described in this Section 5.01 who has a Separation from
Service with the Employer on or after his or her Normal or Delayed Retirement Date by
reason of retirement or voluntary or involuntary termination shall, except as provided
in Section 10.05 (Noncompetition, Embezzlement, etc.), be entitled to a monthly
supplemental retirement income (“Supplemental Retirement Income”) equal to (1) minus
(2), where

	 	(1)	 	equals the monthly Normal or Delayed Retirement Income which
the Key Employee would be entitled to receive under the Pension Plan beginning
on the first day of the month following the Key Employee’s Separation from
Service with the Employer if the benefit limitations of Code Sections
401(a)(17) and 415 as reflected in the Pension Plan were not in effect
(measured in the form of a single life annuity payable in monthly installments
for the Key Employee’s life) and if the definition of Earnings under this Plan
were used to compute the Key Employee’s Normal or Delayed Retirement Income
under the Pension Plan;
	 
	 	(2)	 	equals the monthly Normal or Delayed Retirement Income which
the Key Employee is actually entitled to receive under the Pension Plan
beginning on the first day of the month following the Key Employee’s Separation
from Service with the Employer measured in the form of a single life annuity
payable in monthly installments for the Key Employee’s life.

	5.02	 	Calculation of Supplement for a Rule of 70 Employee Electing Option Two in the Pension
Plan and for a Key Employee who is not a Rule of 70 Employee.

	 	(a)	 	This Section 5.02 contains the benefit formula for either (1) a Key Employee
who is also a Rule of 70 Employee who elected option two (see Article Four) or (2) a
Key Employee who is not a Rule of 70 Employee. These Key Employees had their Credited
Service under the Pension Plan frozen as of midnight on December 31, 2008 but continue
to earn Credited Service under this Plan. This Article Five assumes the Key Employee
has a Separation from Service on or after his or her Normal or Delayed Retirement Date.
	 
	 	(b)	 	Each Key Employee described in this Section 5.02 who has a Separation from
Service with the Employer on or after his or her Normal or Delayed Retirement Date by
reason of retirement or voluntary or involuntary termination shall, except as provided
in Section 10.05 (Noncompetition, Embezzlement, etc.), be entitled to a monthly
Supplemental Retirement Income equal to (1) minus (2) minus (3), where

	 	(1)	 	equals the monthly Normal or Delayed Retirement Income which
the Key Employee would be entitled to receive under the Pension Plan beginning
on the first day of the month following the Key Employee’s Separation from
Service with the Employer if the benefit limitations of Code Sections
401(a)(17) and 415 as reflected in the Pension Plan were not in effect
(measured in the form of a single life annuity payable in monthly installments
for the Key Employee’s life) and if the definition of Earnings under this Plan
and the definition of Credited 

 

 

	 	 	 	Service under this Plan were used to compute the
Key Employee’s Normal or Delayed Retirement Income under the Pension Plan;

	 	(2)	 	equals the monthly Normal or Delayed Retirement Income which
the Key Employee is actually entitled to receive under the Pension Plan
beginning on the first day of the month following the Key Employee’s Separation
from Service with the Employer measured in the form of a single life annuity
payable in monthly installments for the Key Employee’s life;
	 
	 	(3)	 	equals the monthly hypothetical benefit which the Key Employee
would receive on the first day of the month following the Key Employee’s
Separation from Service with the Employer using the Key Employee’s hypothetical
account balance described below converted to a single life annuity.
	 
	 	 	 	The Key Employee’s monthly hypothetical benefit is determined as follows.
Beginning January 1, 2009, a hypothetical account shall be established for
each Key Employee described in Section 5.02. At the end of each calendar
year (or at the time of the Key Employee’s Separation from Service, if
earlier) the hypothetical account balance shall be increased by (A) and (B)
below.

	 	(A)	 	An amount equal to 3.8% (representing a
hypothetical employer contribution) of the Key Employee’s Earnings for
such calendar year up to the limitations of Code Section 401(a)(17)
($245,000 in 2009). For this purpose, Earnings shall have the meaning
as defined in the Pension Plan and not as defined in this Plan.
	 
	 	(B)	 	An amount (representing hypothetical earnings)
equal to 6% multiplied by the balance of the hypothetical account
balance at the beginning of the calendar year. Accordingly, no
interest shall be added for the calendar year ending December 31, 2009.
The 6% interest rate shall be adjusted in computing the hypothetical
earnings for a partial year by taking into account total days in the
partial year and dividing by 360 days. For example, if the partial
year was 90 days, the interest rate for the partial year would be 1.5%
(6% times 90 days divided by 360 days).

The hypothetical account balance shall be converted to a single life annuity
using the Applicable Mortality Table and Applicable Interest Rate as defined
in Section 2.03 of the Pension Plan.

As background only and not to be used as a method of computing the Key
Employee’s hypothetical account, 3.8% represents the additional match a Key
Employee described in Section 5.02 would receive under the Genuine Parts
Company 401(k) Savings Plan (“GPC 401(k) Plan”) instead of under the Genuine
Partnership Plan (“GPC Partnership Plan”). A Key Employee described in
Section 5.01 is eligible to participate in the GPC Partnership Plan with a
maximum match of 1.2% of Earnings. A Key Employee described in Section 5.02
is eligible to participate in the GPC 401(k) Plan with a maximum match of 5%
of Earnings. Thus, 5.0% minus 1.2% equals 3.8%.

ARTICLE SIX — SUPPLEMENTAL RETIREMENT INCOME; 

DISTRIBUTION PRIOR TO NORMAL OR DELAYED RETIREMENT

	6.01	 	Separation from Service On or After the Key Employee’s Early Retirement Date.

 

 

	 	(a)	 	This Section 6.01 applies to a Key Employee who has a Separation from Service
on or after the Key Employee’s Early Retirement Date but before the Key Employee’s
Normal Retirement Date.
	 
	 	(b)	 	Each Key Employee who has a Separation from Service with the Employer on or
after his or her Early Retirement Date by reason of early retirement or voluntary or
involuntary termination shall, except as provided in Section 10.05 (Noncompetition,
Embezzlement, etc.), be entitled to a monthly Supplemental Retirement Income in the
manner described in Section 5.01 or Section 5.02, whichever is applicable, assuming (1)
the monthly Supplemental Retirement Income commenced on the first day of the month
following the Key Employee’s Separation from Service with the Employer. (2) the pension
benefits were payable under Section 4.02 of the Pension Plan and (3) the Key Employee’s
benefit in Section 5.01(b) and the Key Employee’s benefit in Sections 5.02(b)(1) and
(2) (but not (3)) are reduced by the early retirement reduction factors set forth in
the Pension Plan (e.g., see Section 4.02 of the Pension Plan).

	6.02	 	Separation from Service Prior to the Key Employee’s Early Retirement Date.

	 	(a)	 	This Section 6.02 applies to a Key Employee who has a Separation from Service
(1) prior to the Key Employee’s Early Retirement Date but (2) following the Key
Employee’s Permanent Disability, death or the termination of the Plan (i.e., 100%
vested). This Section 6.02 does not apply to a Key Employee who receives a lump sum
distribution on account of a Separation from Service within two years of a Change in
Control. Instead, see Section 9.01. Benefits under this Section 6.02 will commence
on the Key Employee’s Normal Retirement Date (regardless of the Key Employee’s age or
years of Retirement Eligibility Service.)
	 
	 	(b)	 	Each Key Employee who has a Separation from Service with the Employer prior to
his or her Early Retirement Date and in the manner described in Section 6.02(a) by
reason of voluntary or involuntary termination (including death) shall, except as
provided in Section 10.05 (Noncompetition, Embezzlement, etc.), be entitled to a
monthly Supplemental Retirement Income in the manner described in Section 5.01 or
Section 5.02, whichever is applicable on the Key Employee’s Normal Retirement Date. The
Supplemental Retirement Income shall be computed assuming (1) the monthly Supplemental
Retirement Income commenced on the Key Employee’s Normal Retirement Date, (2) the
pension benefits were payable under Section 4.05 of the Pension Plan at Normal
Retirement Date and (3) the Key Employee’s hypothetical account described in Section
5.02(b)(3) continues to receive interest described in subparagraph (B) until the Key
Employee’s Normal Retirement Date.

ARTICLE SEVEN — TIME AND FORM OF PAYMENT; OTHER PROVISIONS

	7.01	 	Distribution Date.

	 	(a)	 	For a Key Employee described in Article 5 (commencement of benefits upon Normal
or Delayed Retirement Date) and a Key Employee described in Section 6.01 (commencement
of benefits upon Early Retirement Date), the Employer shall delay payment of the
Supplemental Retirement Income until the first day of the seventh month following the
Key Employee’s Separation from Service with the Employer.
	 
	 	(b)	 	The first payment to a Key Employee described in Section 7.01(a) shall also
include any payments that were not made following the Key Employee’s Separation from
Service. Thus, the first payment shall be equal to seven months of payments
(representing the 

 

 

	 	 	 	payment made to the Key Employee for the seventh month plus the
monthly payments for the six months following the Key Employee’s Separation from
Service with the Employer). For example, assume a Key Employee described in Article 5
or Section 6.01 has a Separation from Service with the Employer on January 12, and the
first payment was made on August 1 (the first day of the seventh month following
January 12). The August 1 payment shall include an amount equal to seven months of
payments (representing payments for February, March, April, May, June, July and
August).
	 
	 	(c)	 	For a Key Employee described in Section 6.02 (commencement of benefits upon
Normal Retirement Date), the Employer shall delay payment of the Supplemental
Retirement Income until the later of (i) the first day of the seventh month following
the Key Employee’s Separation from Service with the Employer or (ii) the Key
Employee’s Normal Retirement Date. The purpose of this provision is to ensure a Key
Employee has a six month delay in the commencement of his or her Supplemental
Retirement Income. Thus, if the Key Employee had a Separation from Service more than
six full months before the Key Employee’s Normal Retirement Date, the Employer would
commence the Key Employee’s Supplemental Retirement Income on the Key Employee’s
Normal Retirement Date. If the Employer delays commencement of the Key Employee’s
Supplemental Retirement Income pursuant to this Section 7.01(c), the Key Employee will
receive all unpaid payments in the same manner as described in Section 7.01(b). In no
event shall a Key Employee described in this Section 7.01(c) commence receiving
Supplemental Retirement Income prior to his or her Normal Retirement Date.

	7.02	 	Form of Payment
	 
	 	 	A Key Employee may elect among the following annuity payment options available under the
Plan:

	 	(a)	 	Life Annuity Option — a monthly Retirement Income payable during the
Key Employee’s lifetime, with payments ceasing upon the Key Employee’s death.
	 
	 	(b)	 	Joint and 50% Survivor Annuity — a monthly Retirement Income equal
to the reduced Actuarial Equivalent of the Life Annuity Option. The Retirement
Income shall be payable to the Key Employee for the Key Employee’s life, and upon the
Key Employee’s death, 50% of such Retirement Income shall be payable to the Key
Employee’s Spouse for the Spouse’s life. Such Retirement Income shall cease on the
later of the death of the Key Employee or the death of the Key Employee’s Spouse.
	 
	 	(c)	 	Ten Years Certain and Life Option — a monthly Retirement Income
equal to the reduced Actuarial Equivalent of the Life Annuity Option. The Retirement
Income shall be payable to the Key Employee during the Key Employee’s lifetime and,
in the event of the Key Employee’s death, within a period of ten years after the
commencement of benefits, the same monthly amount shall be payable to the Key
Employee’s Beneficiary for the remainder of such ten-year period.
	 
	 	(d)	 	Joint and Last Survivor Option — a monthly Retirement Income equal
to the reduced Actuarial Equivalent of the Life Annuity Option. The Retirement
Income shall be payable to the Key Employee for the Key Employee’s life, and upon the
Key Employee’s death, a designated percentage (100%, 75% or 50%) of the Key
Employee’s Retirement Income shall be payable to the Key Employee’s Beneficiary for
the Beneficiary’s life. Such Retirement Income shall cease on the later of the death
of the Key Employee or the death of the Key Employee’s Beneficiary.

	7.03	 	Election of Form of Benefit

 

 

	 	 	The Key Employee may choose the annuity form of payment at any time prior to the
commencement of benefits under the Plan. In the event that the Key Employee fails to
elect a form of payment, then the Supplemental Retirement Income shall be paid in the form
of a 50% joint and survivor annuity if the Key Employee has a Spouse on the commencement
of benefits date and in the form of a Life Annuity if the Key Employee does not have a
Spouse on the commencement of benefits. If the Supplemental Retirement Income is paid in
a form other than a Life Annuity, then the amount of such benefit shall be adjusted so
that it is the Actuarial Equivalent of the Life Annuity described in Article Five or
Article Six, as applicable.
	 
	7.04	 	Other Provision
	 
	 	 	In computing a Key Employee’s benefit under this Plan, the Committee shall assume the Key
Employee did not accrue a benefit under the Pension Plan (i.e., no Credited Service under
the Pension Plan or this Plan and no Earnings under the Pension Plan or this Plan) during
any calendar year in which the Key Employee did not accrue a benefit under this Plan (see
Section 2.02).

ARTICLE EIGHT — PRE-RETIREMENT DEATH BENEFIT

	8.01	 	Death of Key Employee Before Supplemental Income Payments Commence.

	 	(a)	 	Survivor Benefit. If a Key Employee (married or unmarried at the time
of his or her death) dies before Supplemental Retirement Income commences hereunder and
prior to his or her Separation from Service, then the Key Employee’s Beneficiary shall
be entitled to receive a survivor benefit which is the equal to 50% of the lump sum
value of the Key Employee’s Supplemental Retirement Income accrued to the date of his
or her death under Article Five or Article Six, whichever is applicable. The lump sum
value shall be computed using the Applicable Mortality Table and the Applicable
Interest Rate as defined in Section 2.03 of the Pension Plan and based on the Key
Employee’s age on the first day of the month following his or her death. See Section
8.03 for provisions identifying the Key Employee’s Beneficiary.
	 
	 	(b)	 	Form and Commencement of Survivor Benefit. For purposes of paragraph
(a) above, the survivor benefit shall be a benefit payable as a lump sum distribution
within ninety days of the Key Employee’s death. Section 7.01 does not apply to this
distribution. If a Key Employee died on or after his or her Early Retirement Date, the
lump sum shall be computed assuming the Key Employee had retired on the day of his or
her death and
commenced receiving a Supplemental Retirement Income on the first day of the month
following his death. If a Key Employee dies prior to his or her Early Retirement
Date, the lump sum shall be computed assuming the Key Employee had terminated
employment on the date of his or her death and waited until the Key Employee’s
Normal Retirement Date to commence payment of benefits.

	8.02	 	Death of Key Employee After Supplemental Retirement Income Payments Have Commenced.
	 
	 	 	If a Key Employee dies after Supplemental Retirement Income payments have begun hereunder, then the Key Employee’s
Beneficiary shall be entitled to only that death benefit, if any, which is in effect at the time of the Key Employee’s
death in accordance with the benefit option elected by the Key Employee.

 

 

	8.03	 	Beneficiary Designation.
	 
	 	 	The following shall apply to the designation of a Beneficiary:

	 	(a)	 	A Key Employee’s Beneficiary shall be the individual designated by the Key
Employee on a form provided by the Committee. If no Beneficiary is designated, the Key
Employee’s Beneficiary shall be deemed to be the Key Employee’s Spouse, or if no
Spouse, the Key Employee’s descendants (per stirpes), or if no descendants, the Key
Employee’s estate. For the purposes of the foregoing sentence, the term “descendants”
shall include any persons adopted by a Key Employee or by any of his or her
descendants.
	 
	 	(b)	 	Prior to the commencement of payments under this Plan, a Key Employee may
change his or her Beneficiary designation at any time without spousal consent. After
payments commence, however, the Key Employee cannot change his or her Beneficiary
designation.

ARTICLE NINE — CHANGE OF CONTROL

	9.01	 	Change of Control.

	 	(a)	 	In the event there is a Change of Control of Genuine Parts (as defined in
Section 9.01(d)), a Key Employee described below shall receive an immediate lump sum
payment of the Key Employee’s Supplemental Retirement Income in lieu of the
Supplemental Retirement Income otherwise provided under this Plan.

	 	(1)	 	A Key Employee who has a Separation from Service on account of
a Change of Control shall receive an immediate lump sum payment computed as
described in Section 9.01(b) below. A Key Employee shall be considered to have
a Separation from Service on account of a Change of Control if the Key Employee
has a Separation from Service for any reason (e.g., resignation, involuntary
termination, disability, death, etc.) during the two-year period beginning on
the date on which the Change in Control occurred.
	 
	 	(2)	 	A Key Employee (or his or her Beneficiary if the Key Employee
is not living) who had a Separation from Service prior to the Change of Control
and who is receiving or entitled to receive benefits under the Plan following
the Change in Control shall receive a lump sum benefit computed as described in
Section 9.01(c).

	 	(b)	 	The lump sum payment for a Key Employee described in Section 9.01(a)(i) shall
be determined by computing the present value of the Key Employee’s monthly Supplemental
Retirement Income as of the date of the Key Employee’s Separation from Service on
account of the Change of Control (calculated pursuant to the formula set forth in
Article Five or Article Six, as applicable). The lump sum amount shall be
determined using the Applicable Interest Rate and Applicable Mortality Table as
defined in Section 4.10 of the Pension Plan (i.e., the interest rate used to compute
a lump sum payout from the Pension Plan following a change in control). If a Key
Employee has a Separation from Service prior to his or her Early Retirement Date,
the lump sum shall be computed based on the benefit payable at the Key Employee’s
Normal Retirement Date. The provisions of Section 7.01 (six month delay) apply to
this distribution.
	 
	 	(c)	 	The lump sum payment for a Key Employee described in Section 9.01(a)(ii) shall
be determined by computing the present value of the remaining unpaid monthly

 

 

	 	 	 	Supplemental Retirement Income payments under this Plan using the Applicable Interest
Rate and Applicable Mortality Table as defined in Section 4.10 of the Pension Plan
(i.e., the interest rate used to compute a lump sum payout from the Pension Plan
following a Change of Control) and by assuming such payments begin or continue (as the
case may be) immediately following the Change of Control. The provisions of Section
7.01 (six month delay) apply to this distribution if payments have not already
commenced.

	 	(d)	 	A Change of Control of Genuine Parts means a Change in Control as defined in
Code Section 409A (see Treasury Regulation Section 1.409A-3(i)(5)). This definition
shall apply January 1, 2008 (even though the effective date of this restatement is
January 1, 2009).

ARTICLE TEN — MISCELLANEOUS

	10.01	 	Funding.
	 
	 	 	Nothing contained in this Plan and no action taken pursuant to the
provisions of this Plan shall create or be construed to create a
trust for the purpose of assuring funds for the payment of any
amounts provided herein. The amounts provided by this Plan shall be
paid from each Employer’s general assets or by such other means as
the Employer deems advisable. A Key Employee shall have no title to
or beneficial interest in any assets set aside or acquired by an
Employer to fund its obligations hereunder prior to its due date and
to the extent a Key Employee acquires the right to receive a payment
from the Employer under this Plan, such right shall be no greater
than that of an unsecured general creditor of such Employer.
	 
	10.02	 	Nonassignability.
	 
	 	 	No amount payable under this Plan may be assigned, transferred,
encumbered or subject to any legal process for the payment of any
claim against a Key Employee.
	 
	10.03	 	Costs of Collection; Interest.
	 
	 	 	The Employer shall reimburse the Key Employee or Beneficiary, as the
case may be, for reasonable legal fees and related expenses incurred
by the Key Employee or Beneficiary in connection with his or her
seeking to obtain or enforce any right or benefit provided by this
Agreement, in each case, regardless of whether or not the Key
Employee’s or Beneficiary’s claim is upheld by an arbitral panel or
a court of competent jurisdiction; provided, however, the Key
Employee or Beneficiary shall be required to repay to the Employer
any such amounts to the extent that an arbitral panel or a court
issues a final and non-appealable order, judgment, decree or award
setting forth the determination that the position taken by Key
Employee or Beneficiary was
frivolous or advanced by the Key Employee or Beneficiary in bad faith. The amount
reimbursable by the Employer under this Section 10.03 in any one calendar year shall not
affect the amount reimbursable in any other calendar year, and the reimbursement of an
eligible expense shall be made within 30 days after delivery of Key Employee’s or
Beneficiary’s respective written requests for payment accompanied with such evidence of fees
and expenses incurred as the Employer reasonably may require, but in any event no later than
December 31 of the year after the year in which the expense was incurred. The Key
Employee’s rights pursuant to this Section 10.03 shall expire at the end of twenty years
after the Key Employee’s Separation from Service and shall not be subject to liquidation or
exchange for another benefit.
	 
	10.04	 	No Right to Continued Employment.

 

 

	 	 	Nothing in this Plan shall be deemed to give any Key Employee the
right to be retained in the service of the Employer or to deny the
Employer any right it may have to discharge a Key Employee at any
time.
	 
	10.05	 	Noncompetition, Embezzlement, Etc.

	 	(a)	 	Notwithstanding other provisions herein to the contrary, if a Key Employee
receiving or eligible to receive Supplemental Retirement Income under this Plan commits
a material breach, as determined by the Committee, of his or her covenant not to
compete as set forth in the Joinder Agreement, then the Key Employee shall cease to
participate in the Plan as of the date of such breach and the Employer shall have no
further obligation to make Supplemental Retirement Income payments to the Key Employee.
	 
	 	(b)	 	If the Committee determines that a Key Employee has committed embezzlement,
defalcation or any other criminal activity which is connected with his or her
employment with the Employer, then no payments of any kind shall be made under this
Plan to or for the benefit of the Key Employee or his or her Beneficiary. If such
determination is made after the Key Employee (or his or her Beneficiary) has begun
receiving payments hereunder, then payments shall cease immediately upon a
certification by the Committee that an event has occurred which triggers loss of
benefits under this section.
	 
	 	(c)	 	Any payments that are not paid pursuant to subsections (a) or (b) above shall
be irrevocably forfeited.

	10.06	 	Governing Law.
	 
	 	 	This Plan shall be governed by and construed in accordance with the laws of the State of Georgia to the extent such laws
are not preempted by Federal law.
	 
	10.07	 	Successors and Assigns.
	 
	 	 	This Plan shall be binding upon the successors and assigns of the parties hereto.
	 
	10.08	 	Right to Amend and Terminate.
	 
	 	 	The Committee reserves the right to modify, alter, amend, or terminate the Plan, at any time and from time to time,
without notice, to any extent deemed advisable; provided, however, that no such amendment or termination shall (without
the written consent of the Key Employee, if living, and if not, the Key Employee’s Beneficiary) adversely affect any
benefit under the Plan which has accrued with respect to the Key Employee as of the date of such amendment or termination
regardless of whether such benefit is vested or in pay status. Notwithstanding the
foregoing, no amendment, modification, alteration, or termination of this Plan may be given
effect with respect to any Key Employee without the consent of such Key Employee (if living,
and if not, the Key Employee’s Beneficiary) if such amendment, modification, alteration, or
termination is adopted during the six-month period prior to a Change of Control or during
the two-year period following a Change of Control. In addition, no termination shall result
in an acceleration of any benefit under this Plan unless such termination complies with the
termination and liquidation provisions of Code Section 409A (see Treas. Reg. Section
1.409A-3(j)(4)(ix)). Finally, if the Plan does not comply with applicable law (including
Code Section 409A), the Committee may amend the Plan to comply with Code Section 409A,
including optional Code Section 409A provisions, and may amend the Plan to comply with other
required changes in law without the consent of Key Employees or Beneficiaries and regardless
of a prior or subsequent Change in Control.

 

 

ARTICLE ELEVEN — DEFINITIONS AND SPECIAL RULES

	11.01	 	Separation from Service shall have the following meaning:

	 	(a)	 	General Rule. A Key Employee is deemed to have a Separation from
Service if the Key Employee dies, retires or otherwise has a bona fide termination as
an employee of the Employer.
	 
	 	(b)	 	Leave of Absence. Separation from Service does not occur when the Key
Employee is on military leave, sick leave or other bona fide leave of absence if the
period of such leave does not exceed six months or any longer period provided the Key
Employee retains a right to again provide services as an employee following the end of
a leave of absence under an applicable statute or by contract. In any event, a leave
of absence will prevent a Separation from Service occurring only if there is a
reasonable expectation that the Key Employee will return to perform services for the
Employer as an employee at the conclusion of the leave. If the leave of absence
exceeds six months and the Key Employee is not entitled to return to service as an
employee under an applicable statute or by contract, the Key Employee will have a
Separation from Service on the first date immediately following such six-month period.
However, if the leave of absence is due to any medically determinable physical or
mental impairment that can be expected to result in death or can be expected to last
for a continuous period of not less than six months, where such impairment causes the
Key Employee to be unable to perform the duties of his or her position or any
substantially similar position, a 29-month period of absence shall be substituted for
such six—month period.
	 
	 	(c)	 	Termination. Whether a Key Employee has retired or otherwise
terminated as a Key Employee (or subsequent employment) is determined based on the
facts and circumstances indicating that the Employer and the Key Employee reasonably
anticipated that no further services would be performed after a certain date.
	 
	 	(d)	 	Presumption of Separation from Service. If the Employer and the Key
Employee reasonably anticipate that the bona fide services the Key Employee would
perform after a specified date (either as an employee or an independent contractor)
would permanently decrease to an amount equal to or less than 20% of the average level
of bona fide services provided in the immediately preceding thirty-six (36) months, the
Key Employee will be presumed to have had a Separation from Service. See applicable
treasury regulations for rules applicable in determining a Key Employee’s average level
of bona fide services during the preceding thirty-six (36) months in the event the Key
Employee was on a paid
bona fide leave of absence or an unpaid bona fide leave of absence during the
preceding thirty-six (36) months.

	11.02	 	Spouse. Except as modified in this definition, the term “Spouse” shall have the
same meaning as the Pension Plan. If a Key Employee has a Separation from Service on or after
his or her Early Retirement Date, the Spouse shall be determined as of the Key Employee’s
Separation from Service. If the Key Employee has a Separation from Service prior to his or
her Early Retirement Date, the Spouse shall be determined as of the Key Employee’s Normal
Retirement Date.

	11.03	 	Credited Service. For some Key Employees, Credited Service under the Pension Plan
has been frozen. Regardless, for purposes of this Plan, all Key Employees shall continue to
earn Credited Service under the terms of the Pension Plan assuming Credited Service had not
been frozen. No Credited Service shall be earned if an Employee ceases to be a Key Employee
or if the Key Employee is not entitled to accrue a benefit under this Plan (see Section 2.02).

 

 

     IN WITNESS WHEREOF, Genuine Parts Company has caused this Plan to be signed by its duly
authorized officer on the date shown below, but effective as of January 1, 2009 (or effective as of
such earlier date for certain provisions as indicated in the amendment).

	 	 	 	 	 
	 	GENUINE PARTS COMPANY

 	 
	 	By:  	/s/ Frank M. Howard
 	 
	 	 	Title:  Sr. V.P. & Treasurer 	 
	 	 	Date: 12-22-08	 
	 

	 	 	 	 	 
	Attest:

 	 	 
	/s/ Linda L. Olvey
 	 	 
	 	 	 

	 	 	 	 	 
	 	Date: 12-22-08EX-10.1

Exhibit 10.1

	 	 	 	 	 	 	 
	STATE OF NORTH CAROLINA

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	COUNTY OF FORSYTH

	 	 	)	 	 	 
	 

	 	 	 	 	 	SEVERANCE AGREEMENT

AND

RELEASE IN FULL
	Gary L. Lackey

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	                    and

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	GRANITE MORTGAGE CO.

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	 

     Gary L. Lackey (“Mr. Lackey”) and Granite Mortgage Company (“the Company”), in consideration
of the mutual promises hereinafter exchanged, agree as follows:

     1. The parties agree that Mr. Lackey’s employment agreement is terminated effective February
23, 2009, and Mr. Lackey will be relieved of this position as stated in his AMENDED AND RESTATED
EMPLOYMENT AND NONCOMPETITION AGREEMENT dated 5/1/2003. The Company will pay Mr. Lackey for a
total $432,000.00, with appropriate withholdings made to “Mr. Lackey” on Granite Mortgage payroll.
(This payment can be in the form of a one-time total payment on 3/24/09 or split payment -
$216,000.00 on 3/24/09 and the remaining $216,000.00 on 1/29/10 by providing a signed written
statement to Karen Warlick to confirm payment option).

     2. The Company will pay, by lump sum, to (Mr. Lackey), the gross amount of all
accumulated but unused vacation time remaining for 2009, twenty-one (21) days at $75.31 per hour
for $12,652.90 from which appropriate withholdings will be made and paid to Mr. Lackey on 2/27/09.

5

 

     3. From and after the date of termination set forth in paragraph 1, Mr. Lackey shall not have
the right to participate in or receive any benefit under any employee benefit plan of the Company,
any fringe benefit plan of the Company, or any other plan, policy or arrangement of the Company
providing benefits or perquisites to employees of the Company generally or individually. Provided,
however, that he shall be entitled, if otherwise eligible, to elect the payment of benefits to
which he is entitled under any employee benefit plan and to COBRA benefits as required by law.

     4. In consideration of the above referenced payment to him, Mr. Lackey intends to and does
hereby release and covenant not to sue the Company, Bank of Granite Corporation and Bank of
Granite, and their past and present Directors, their past and present employees and agents, and any
other persons, agencies, firms, or corporations affiliated with the Company, Granite Mortgage and
Bank of Granite from any and all causes of action and claims from the beginning of time to the date
this Agreement is executed, including any causes of actions and claims which he may have on account
of or in any way arising out of or in connection with his employment or other relationship with the
Company, or the cessation of his employment with the Company.

     5. This release and covenant not to sue specifically includes, but is not limited to, any and
all charges or actions under Title VII of the Civil Rights Act of 1964 as amended; the
Age Discrimination in Employment Act; the Americans with Disabilities Act; the North Carolina
Retaliation Discrimination Law, the Constitution, statutes, regulations, and Executive Orders of
the United States and the State of North Carolina; and any and all claims at common law, including
but not limited to, contractual claims and both intentional and unintentional tort claims;
defamation claims; or for any other cause. Mr. Lackey agrees, as a further consideration and
inducement for this agreement, that it shall apply to unknown and unanticipated damages

6

 

resulting from in or in any way connected to his employment with the Company and the cessation of
such employment through the effective date of this agreement.

     6. This Severance Agreement and Release in Full is not to be construed as an admission of
liability on the part of the parties released and the parties hereby released deny liability of any
nature or kind whatsoever to Mr. Lackey. This agreement is contractual and not merely recital.

     7. Mr. Lackey agrees not to disclose the terms of his Severance Agreement and Release in Full
to any person except as may be required by law.

     8. The Company agrees to provide only neutral references [beginning and ending dates of
employment and position(s) held] to prospective employers. Mr. Lackey agrees to advise all
prospective employers to direct their inquiries to Karen Warlick regarding Mr. Lackey’s prior
employment.

     9. Mr. Lackey expressly agrees that he will not make any disparaging remarks regarding the
Company, Bank of Granite Corporation, Bank of Granite, their operations, past and present Board
members, and their past and present employees and agents.

     10. Mr. Lackey will immediately return all Company property and equipment provided to him in
the course and scope of his employment.

     11. The Company makes no representations or warranties concerning the tax treatment of the
payments referred to in Paragraphs 2, 3, and 4 of this Agreement and Mr. Lackey can consult with
his tax advisor regarding the payments.

     12. Mr. Lackey acknowledges that, pursuant to the provisions of the Older Workers Benefit
Protection Act, he shall have up to twenty-one (21) days from the date this Agreement is presented
to him to consider this agreement, and that he shall have seven (7) days from the date he executes
his Agreement to rescind this agreement by providing a signed written statement to

7

 

Karen Warlick. Mr. Lackey acknowledges that if he does not execute and return his Agreement
to Company by 5:00 p.m. on March 16, 2009, this Agreement shall be void.

     13. Mr. Lackey may choose to consult with his attorney regarding this Agreement.

     14. This Agreement shall become effective upon the expiration of the seven-day revocation
period provided in paragraph 12 above in the event that Mr. Lackey has not revoked his acceptance
of this Agreement as provided therein (the “Effective Date”).

     15. The non-competition and confidentiality provisions set forth in the AMENDED AND RESTATED
EMPLOYMENT AND NONCOMPETITION AGREEMENT dated 5/1/2003 remain in effect under the terms set forth
therein.

     16. Finally, the undersigned state that they have read and fully understand this Severance
Agreement and Release in Full and agree that it is the entire agreement between them related to the
contents thereof.

     IN WITNESS WHEREOF, the undersigned have initialed each of the
preceding pages and have set their hands and seals below.

	 	 	 	 	 
	Granite Mortgage, Inc.	 	 
	 
	 	 	 	 
	By:

	 	/s/ Karen Warlick
	 	/s/ Gary L. Lackey
	 

	 	Karen Warlick
	 	Gary L. Lackey
	 
	 	 	 	 
	DATE:

	 	2/23/09
	 	DATE: 2/24/09

8

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