ABG

Business Context and Reporting Period

Company: Asbury Automotive Group, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: January 18, 2006 (Event Date: January 11, 2006)
Context: The Company reported the entry into a material definitive agreement regarding the approval and grant of performance share units to key employees and directors under its 2002 Equity Incentive Plan.

Key Financial Metrics

The filing does not provide specific financial metrics such as revenue, profit, cash flow, margins, debt, or liquidity figures. The document focuses exclusively on the terms of an equity compensation agreement.

Material Changes

Equity Compensation Grant: On January 11, 2006, the Compensation Committee approved a grant of 175,500 performance share units (Performance Awards).
Recipients: The awards were granted to specific directors and executive officers, including:

• Charles B. Tomm (Director, President and CEO of Florida Region): 20,000 units
• J. Gordon Smith (SVP and CFO): 20,000 units
• Lynne A. Burgess (VP, General Counsel and Secretary): 5,000 units
• Philip R. Johnson (VP, Human Resources): 5,000 units
• Brett Hutchinson (VP and Controller): 2,000 units

Total Potential Issuance: Depending on performance, the total number of shares issued may range from 0 to 315,900.

Guidance, Outlook, and Performance Criteria

Performance Cycle: 2005, 2006, and 2007.
Performance Goals: Awards are based on objective goals related to:

1. New vehicle revenue growth
2. Used vehicle revenue growth
3. Finance and insurance revenue growth
4. Fixed operations gross profit
5. Earnings per share

Payout Range: Actual shares earned may range from 0% to 180% of the target number based on goal achievement.
Settlement Terms: Settlement is in shares of common stock, except in the event of a change of control, where special provisions may result in settlement in acquirer securities or cash.

Investor Verification Checklist

• Verify the specific performance targets for the 2005-2007 cycle in the attached Exhibit 10.1 (Form of Performance Share Unit Award Agreement).
• Confirm the dilution impact of the potential maximum issuance of 315,900 shares.
• Review the "change of control" provisions to understand potential cash or alternative security settlements.
• Check subsequent filings for the actual performance results against the stated goals for the 2005-2007 period.