-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NKkg5d9h+baNEBd+/MDlMiUNlzqTW6uK5Q3xTUxNG2zkp+XYmPCWvaQnDgzzaWUr ZAJWXEWNDpKecyMor5kwDw== 0000950152-97-006037.txt : 19970815 0000950152-97-006037.hdr.sgml : 19970815 ACCESSION NUMBER: 0000950152-97-006037 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970814 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MONRO MUFFLER BRAKE INC CENTRAL INDEX KEY: 0000876427 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-AUTOMOTIVE REPAIR, SERVICES & PARKING [7500] IRS NUMBER: 160838627 STATE OF INCORPORATION: NY FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-19357 FILM NUMBER: 97662201 BUSINESS ADDRESS: STREET 1: 200 HOLLEDER PKWY CITY: ROCHESTER STATE: NY ZIP: 14615-3808 BUSINESS PHONE: 7166476100 10-Q 1 MONRO MUFFLER BRAKE, INC. FORM 10-Q 1 FORM 10-Q (Conformed Copy) SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1997. OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from to ----------- ----------- Commission File No. 0-19357 ---------- MONRO MUFFLER BRAKE, INC. - ------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) New York 16-0838627 - ------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification #) 200 Holleder Parkway, Rochester, New York 14615 - ------------------------------------------------------------------------------- (Address of principal executive offices) (Zipcode) Registrant's telephone number, including area code 716-647-6400 ----------------------------- 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 ----- ---- As of August 7, 1997, 7,866,901 shares of the Registrant's Common Stock, par value $ .01 per share, were outstanding after giving retroactive effect to the five percent stock dividend, payable August 4, 1997, to stockholders of record as of June 20, 1997. 2 MONRO MUFFLER BRAKE, INC. INDEX ----- Part I. Financial Information Page No. Consolidated Balance Sheet at June 30, 1997 and March 31, 1997 3 Consolidated Statement of Income for the quarter ended June 30, 1997 and 1996 4 Consolidated Statement of Changes in Common Stockholders' Equity for the quarter ended June 30, 1997 5 Consolidated Statement of Cash Flows for the quarter ended June 30, 1997 and 1996 6 Notes to Consolidated Financial Statements 7 Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Part II. Other Information Item 6. Exhibits and Reports on Form 8-K 12 Signatures 13 Exhibit Index 14 -2- 3 MONRO MUFFLER BRAKE, INC. CONSOLIDATED BALANCE SHEET (UNAUDITED)
JUNE 30, MARCH 31, 1997 1997 ---- ---- (DOLLARS IN THOUSANDS) ASSETS Current assets: Cash and equivalents, including interest-bearing accounts of $8,022 at June 30, 1997 and $6,438 at March 31, 1997 $ 8,022 $ 6,438 Trade receivables 1,069 1,128 Inventories, at LIFO cost 21,533 20,010 Federal and state income taxes receivable 0 296 Deferred income tax asset 1,790 1,790 Other current assets 2,499 2,935 --------- --------- Total current assets 34,913 32,597 --------- --------- Property, plant and equipment 157,827 151,906 Less - Accumulated depreciation and amortization (44,377) (42,223) --------- --------- Net property, plant and equipment 113,450 109,683 Other noncurrent assets 3,876 3,987 ========= ========= Total assets $ 152,239 $ 146,267 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Current portion of long-term debt $ 3,128 $ 3,128 Trade payables 11,589 8,728 Federal and state income taxes payable 1,772 0 Accrued expenses and other current liabilities Accrued interest 285 270 Accrued payroll, payroll taxes and other payroll benefits 4,053 4,260 Accrued insurance 2,155 2,110 Other current liabilities 3,394 4,522 --------- --------- Total current liabilities 26,376 23,018 Long-term debt 54,010 54,864 Deferred income tax liability 1,760 1,760 --------- --------- Total liabilities 82,146 79,642 --------- --------- Commitments Shareholders' equity: Class C Convertible Preferred Stock, $1.50 par value, $.227 and $.239 conversion value at June 30, 1997 and March 31, 1997, respectively; 150,000 shares authorized; 91,727 shares issued and outstanding 138 138 Common Stock, $.01 par value, 15,000,000 shares authorized; 7,866,901 shares and 7,470,326 shares issued and outstanding at June 30, 1997 and March 31, 1997, respectively 79 75 Additional paid-in capital 29,256 22,190 Retained earnings 40,620 44,222 --------- --------- Total shareholders' equity 70,093 66,625 --------- --------- Total liabilities and shareholders' equity $ 152,239 $ 146,267 ========= =========
These financial statements should be read in conjunction with the financial statements and notes thereto included in the Annual Report on Form 10-K (File No. 0-19357), filed by the Company with the Securities and Exchange Commission on June 27, 1997. -3- 4 MONRO MUFFLER BRAKE, INC. CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
QUARTER ENDED JUNE 30, 1997 1996 ---- ---- (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) Sales $40,773 $37,745 Cost of sales, including distribution and occupancy costs (a) 22,631 20,666 ------- ------- Gross profit 18,142 17,079 Operating, selling, general and administrative expenses 11,492 10,645 ------- ------- Operating income 6,650 6,434 Interest expense, net of interest income for the quarter of $22 in 1997 and $1 in 1996 (a) 868 814 Other expense, net 85 16 ------- ------- Income before provision for income taxes 5,697 5,604 Provision for income taxes 2,280 2,225 ------- ------- Net income $ 3,417 $ 3,379 ======= ======= Earnings per share $ .40 $ .40 ======= ======= Weighted average number of shares of common stock and common stock equivalents used in computing earnings per share 8,605 8,540 ======= =======
(a) Amounts paid under operating and capital leases with affilliated parties totalled $483 and $496 for the quarters ended June 30, 1997 and 1996, respectively. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Annual Report on Form 10-K (File No. 0-19357), filed by the Company with the Securities and Exchange Commission on June 27, 1997. -4- 5 MONRO MUFFLER BRAKE, INC. CONSOLIDATED STATEMENT OF CHANGES IN COMMON STOCKHOLDERS' EQUITY (UNAUDITED)
COMMON STOCK ADDITIONAL ----------------- PAID-IN RETAINED SHARES AMOUNT CAPITAL EARNINGS ------ ------ ------- -------- (Amounts in thousands) Balance at March 31, 1997 7,470 75 $ 22,190 $ 44,222 Net income 3,417 Exercise of stock options 23 52 5% stock dividend 374 4 7014 (7,019) -------- -------- -------- -------- Balance at June 30, 1997 7867 79 $ 29,256 $ 40,620 ======== ======== ======== ========
These financial statements should be read in conjunction with the financial statements and notes thereto included in the Annual Report on Form 10-K (File No. 0-19357), filed by the Company with the Securities and Exchange Commission on June 27, 1997. -5- 6 MONRO MUFFLER BRAKE, INC. CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
QUARTER ENDED JUNE 30, -------- 1997 1996 ---- ---- (DOLLARS IN THOUSANDS) INCREASE (DECREASE) IN CASH Cash flows from operating activities: Net income $ 3,417 $ 3,379 -------- -------- Adjustments to reconcile net income to net cash provided by operating activities - Depreciation and amortization 2,234 1,957 Loss (gain) on disposal of property, plant and equipment 14 (40) Decrease in trade receivables 59 121 Increase in inventories (1,523) (2,317) Decrease in other current assets 436 246 Decrease (increase) in other noncurrent assets 40 (15) Increase in trade payables 2,861 1,065 (Decrease) increase in accrued expenses (1,276) 444 Increase in federal and state income taxes payable 2,068 1,939 -------- -------- Total adjustments 4,913 3,400 -------- -------- Net cash provided by operating activities 8,330 6,779 -------- -------- Cash flows from investing activities: Capital expenditures (5,938) (4,737) Proceeds from the disposal of property, plant and equipment 3 2 -------- -------- Net cash used for investing activities (5,935) (4,735) -------- -------- Cash flows from financing activities: Proceeds from the sale of common stock 52 384 Proceeds from borrowings 15,410 11,380 Principal payments on long-term debt and capital lease obligations (16,273) (14,421) -------- -------- Net cash used for financing activities (811) (2,657) -------- -------- Increase (decrease) in cash 1,584 (613) Cash at beginning of year 6,438 5,280 -------- -------- Cash at June 30 $ 8,022 $ 4,667 ======== ========
These financial statements should be read in conjunction with the financial statements and notes thereto included in the Annual Report on Form 10-K (File No. 0-19357), filed by the Company with the Securities and Exchange Commission on June 27, 1997. -6- 7 MONRO MUFFLER BRAKE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1 - Stock Dividend - ----------------------- On May 14, 1997, the Board of Directors declared a five percent stock dividend, payable August 4, 1997, to stockholders of record as of June 20, 1997. The consolidated financial statements, including all share information therein, have been restated to reflect this dividend. Additionally, in accordance with antidilution provisions of the Class C Convertible Preferred Stock, the conversion value of the preferred stock was restated from $.239 per share to $.227 per share. Shares reserved for issuance to officers and key employees under outstanding options and under the 1984, 1987 and 1989 Incentive Stock Option Plans have also been retroactively adjusted for the five percent stock dividend. Note 2: New Accounting Standards - --------------------------------- The Company will adopt the provisions of Financial Accounting Standards ("FAS") No. 128, "Earnings Per Share" effective for financial statements issued for periods ending after December 15, 1997; earlier application is not permitted. FAS 128 requires dual presentation of basic and diluted EPS on the face of the income statement and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS calculation. Basic EPS excludes the effect of common stock equivalents and is computed by dividing income available to common shareowners by the weighted average common shares outstanding for the period. Diluted EPS reflects the potential dilution that could result if securities or other instruments to issue common stock were exercised or converted into common stock. Proforma earnings per share computed in accordance with FAS 128 is presented below:
Three months ended June 30, 1997 1996 ---- ---- Basic earnings per share $ 0.44 $ 0.44 Diluted earnings per share $ 0.40 $ 0.40
Note 3 - Inventories - -------------------- The Company's inventories consist of automotive parts and tires. Substantially all merchandise inventories are valued under the last-in, first-out (LIFO) method. Under the first-in, first-out (FIFO) method, these inventories would have been $628,000 and $544,000 higher at June 30, 1997 and March 31, 1997, respectively. The FIFO value of inventory approximates the current replacement cost. -7- 8 MONRO MUFFLER BRAKE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 4 - Cash and Equivalents - ----------------------------- The Company's policy is to invest cash in excess of operating requirements in income producing investments. Cash equivalents of $8,022,000 at June 30, 1997 and $6,438,000 at March 31, 1997 include money market accounts which have maturities of three months or less. Note 5 - Supplemental Disclosure of Cash Flow Information - --------------------------------------------------------- The following transactions represent noncash investing and financing activities during the periods indicated: QUARTER ENDED JUNE 30, 1997: In connection with the declaration of a five percent stock dividend (see Note 1), the Company increased accrued expenses, common stock and additional paid-in capital by $1,000, $4,000 and $7,014,000, respectively, and decreased retained earnings by $7,019,000. QUARTER ENDED JUNE 30, 1996: In connection with the termination of a capital lease, the Company reduced debt and fixed assets by $112,000. In connection with the declaration of a five percent stock dividend, the Company increased common stock and additional paid-in capital by $4,000 and $4,584,000, respectively, and decreased retained earnings by $4,588,000. CASH PAID DURING THE PERIOD:
1997 1996 ------ ---- Interest, net $978,000 $981,000 Income taxes 212,000 286,000
Note 6 - Other - -------------- These financial statements should be read in conjunction with the financial statements and notes thereto included in the Annual Report on Form 10-K (File No. 0-19357), filed by the Company with the Securities and Exchange Commission on June 27, 1997. -8- 9 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS The statements contained in this Form 10-Q which are not historical facts, including (without limitation) statements made in the Management's Discussion and Analysis of Financial Condition and Results of Operations, may contain statements of future expectations and other forward-looking statements that are subject to important factors that could cause actual results to differ materially from those in the forward-looking statements, including (without limitation) product demand, the effect of economic conditions, the impact of competitive services and pricing, product development, parts supply restraints or difficulties, industry regulation, the continued availability of capital resources and financing and other risks set forth or incorporated elsewhere herein and in the Company's Securities and Exchange Commission filings. The following table sets forth income statement data of Monro Muffler Brake, Inc. ("Monro" or the "Company") expressed as a percentage of sales for the fiscal periods indicated.
Quarter Ended June 30, ---------------------- 1997 1996 ----- ----- Sales .............................................. 100.0% 100.0% Cost of sales, including distribution and occupancy costs ............................... 55.5 54.8 ----- ----- Gross profit ....................................... 44.5 45.2 Operating, selling, general and administrative expenses ........................... 28.2 28.2 ----- ----- Operating income ................................... 16.3 17.0 Interest expense - net ............................. 2.1 2.1 Other expense ...................................... .2 -- ----- ----- Income before provision for income taxes ........... 14.0 14.9 Provision for income taxes ......................... 5.6 5.9 ----- ----- Net income ......................................... 8.4% 9.0% ===== =====
-9- 10 FIRST QUARTER ENDED JUNE 30, 1997 COMPARED TO FIRST QUARTER ENDED JUNE 30, 1996. Sales were $40.8 million for the quarter ended June 30, 1997 compared with $37.7 million in the quarter ended June 30, 1996. The sales increase of $3.0 million, or 8.0%, was due to an increase in sales of approximately $3.5 million relating to stores opened since the beginning of fiscal 1996, offset by a decrease in comparable store sales of 1.0%. At June 30, 1997, the Company had 324 stores in operation compared to 284 at June 30, 1996. Management believes that year-to-date comparable store sales decreases were driven, in part, by the cold, wet weather during the months of April and May, and the aftermath of a relatively mild winter which have created a softness in the industry. Gross profit for the quarter ended June 30, 1997 was $18.1 million or 44.5% of sales compared with $17.1 million or 45.2% of sales for the quarter ended June 30, 1996. The decline in gross profit as a percentage of sales was due, in part, to an increase in labor costs. During periods of slower sales when technicians may not be fully productive, they will receive a minimum base level wage. Additionally, distribution and occupancy costs increased as a percent of sales for the first quarter of fiscal 1998 as compared to the first quarter of fiscal 1997 primarily due to an increase in the number of stores against a comparable store sales decrease. Operating, selling, general and administrative expenses for the quarter ended June 30, 1997 increased by $.8 million to $11.5 million over the quarter ended June 30, 1996, and remained level at 28.2% of sales compared to the same quarter of the prior year. The increase in total dollars expended is primarily attributable to increased store supervision and increased store support expenses. Although expenses increased during the first quarter of fiscal 1998 as compared to the first quarter of fiscal 1997, these expenses remained constant as a percent of sales primarily due to management's continued focus on discretionary spending and controlling costs, as well as increased cooperative advertising credits. Operating income for the quarter ended June 30, 1997 of approximately $6.7 million increased 3.4% over operating income for the quarter ended June 30, 1996, and decreased as a percentage of sales from 17.0% to 16.3% for the same periods. Net interest expense for the quarter ended June 30, 1997 increased by approximately $.1 million compared to the comparable period in the prior year, and remained level at 2.1% as a percentage of sales. The increase in expense is due to an increase in the average debt outstanding during the quarter, partially offset by a decrease in the weighted average interest rate. Net income for the quarter ended June 30, 1997 of $3.4 million increased 1.1% over net income for the quarter ended June 30, 1996. -10- 11 Interim Period Reporting The data included in this report are unaudited and are subject to year-end adjustments; however, in the opinion of management, all known adjustments (which consist only of normal recurring adjustments) have been made to present fairly the Company's operating results for the unaudited periods. The results for interim periods are not necessarily indicative of results to be expected for the fiscal year. CAPITAL RESOURCES AND LIQUIDITY Capital Resources The Company's primary capital requirement has been the funding of its new store expansion program and the upgrading of facilities and systems in existing stores. For the quarter ended June 30, 1997, the Company spent $5.9 million for equipment and new store construction. Funds were provided by cash flow from operations. Management believes that the Company has sufficient resources available (including cash and equivalents, net cash flow from operations and bank financing) to expand its business as currently planned for the next several years. Liquidity The Company has a line of credit from a commercial bank of $7.5 million. No amounts were outstanding under this short-term borrowing facility at June 30, 1997. Through February 7, 1996, the Company had a real estate line of credit of $25 million to be used for placement of mortgages. This line was terminated in fiscal 1996 at the Company's initiative and replaced by a new unsecured Revolving Credit facility with two banks. In June 1997, the Credit Agreement was modified to increase the amount available under the facility from $30 million to $50 million, and extend the term to March 2000. The facility bears interest at the prime rate or other LIBOR-based rate options tied to the Company's financial performance. Prior to the termination of the real estate line, the Company had utilized $13.2 million of the real estate line of credit for permanent mortgages. The Company has outstanding $3.7 million in principal amount of its 10.65% Senior Notes due 1999 (the "Senior Notes") with Massachusetts Mutual Life Insurance Company pursuant to a Senior Note Agreement. The fourth of six equal annual installments of principal in the amount of $1.8 million was paid on April 1, 1997. The Company has financed its office/warehouse facility via a 10 year mortgage with a current balance of $2.8 million, amortizable over 20 years, and an eight year term loan with a balance of $.6 million. Certain of the Company's long-term debt agreements require, among other things, the maintenance of specified current ratios, interest and rent coverage ratios and amounts of tangible net worth, and also contain restrictions on dividend payments and capital expenditures. -11- 12 MONRO MUFFLER BRAKE, INC. PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K -------------------------------- a. Exhibits 10.1 - Amendment One to Credit Agreement among the Chase Manhattan Bank, Fleet Bank and the Company, dated June 25, 1997. 11 - Statement of Computation of Per Share Earnings. 27 - Financial Data Schedule. b. Reports on Form 8-K The Company filed a report on Form 8-K on June 10, 1997 in connection with the declaration of a 5% stock dividend by the Company's Board of Directors on May 14, 1997. -12- 13 SIGNATURES ---------- Pursuant to the requirements 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. MONRO MUFFLER BRAKE, INC. DATE: August 13, 1997 By /s/ Lawrence C. Day ------------------------- Lawrence C. Day President and Chief Executive Officer DATE: August 13, 1997 By /s/ Catherine D'Amico --------------------------- Catherine D'Amico Senior Vice President-Finance, Treasurer and Chief Financial Officer -13- 14
EXHIBIT INDEX Exhibit No. Description Page No. ----------- ----------- -------- 10.1 Amendment One to Credit Agreement among the Chase Manhattan Bank, Fleet Bank and the Company, dated June 25, 1997. 15 11 Statement of computation of per share earnings. 18 27 Financial Data Schedule.
-14- EX-10.1 2 EXHIBIT 10.1 1 EXHIBIT 10.1 AMENDMENT ONE TO CREDIT AGREEMENT This Amendment One is dated as of June 25, 1997 and is made among MONRO MUFFLER BRAKE, INC. (the "Borrower"), THE CHASE MANHATTAN BANK (successor by merger to The Chase Manhattan Bank, N.A.) and FLEET BANK (the "Lenders"), and THE CHASE MANHATTAN BANK as agent for the Lenders (in such capacity, together with its successors in such capacity, the "Agent"). STATEMENT OF THE PREMISES The Borrower, the Lenders and the Agent previously entered into a Credit Agreement dated as of February 7, 1996 (the "Credit Agreement"). The Borrower has requested that the Lenders increase the amount of the "Commitments" under the Credit Agreement, extend the "Revolving Credit Termination Date" under the Credit Agreement, and amend the calculation of the "Performance Ratio" under the Credit Agreement. The Lenders are willing to do so upon certain conditions. STATEMENT OF CONSIDERATION Accordingly, in consideration of the premises, and under the authority of Section 5-1103 of the New York General Obligations Law, the parties hereto agree as follows. AGREEMENT 1. DEFINED TERMS. The terms "this Agreement", "hereunder" and similar references in the Credit Agreement shall be deemed to refer to the Credit Agreement as amended hereby. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to such terms in the Credit Agreement. 2. AMENDMENT. Effective as of June 25, 1997, upon the satisfaction of all conditions precedent specified in Section 3 hereof, the Credit Agreement is hereby amended as follows: 2.1 Section 1.1 of the Credit Agreement is amended by changing the definitions of "COMMITMENT", "PERFORMANCE RATIO" and "REVOLVING CREDIT TERMINATION DATE" to read in their entirety as follows: -15- 2 "COMMITMENT" means, with respect to each Lender, the separate obligation of such Lender to make Revolving Credit Loans under this Agreement in the following aggregate principal amount specified for such Lender, as such amount may be reduced pursuant to Section 2.08: Chase: $25,000,000 Fleet: $25,000,000 =========== Total: $50,000,000 "PERFORMANCE RATIO" means the ratio, computed (for both the numerator and denominator) as of the end of each fiscal quarter in respect of the Four Quarter Period which is coterminous with the end of such fiscal quarter, of (a) the average Consolidated Funded Debt for the preceding twelve months calculated using the month-end balance for each month, to (b) the Consolidated EBITDA for the Four Quarter Period then ended. "REVOLVING CREDIT TERMINATION DATE" means March 31, 2000. 2.2 Section 8.02 of the Credit Agreement is hereby amended to read in its entirety as follows: Section 8.02 PERFORMANCE RATIO. The Borrower shall not permit the Performance Ratio to exceed 300%. 3. CONDITIONS PRECEDENT TO EFFECTIVENESS. This Amendment One shall become effective when and only when the following conditions precedent shall have been fully satisfied: 3.1 The Lenders shall have received all the following documents, each document being in form and substance satisfactory to the Lenders and their counsel: 3.1.1 Counterparts of this Amendment One executed by the Borrower, the Lenders and the Agent; 3.1.2 Notes to each Lender dated as of the date hereof in face amounts equal to the corresponding total of the increased Commitments of each Lender, whereupon the existing Notes dated February 7, 1996 shall be marked cancelled and returned to the Borrower and shall be of no further force and effect. 3.1.3 A Secretarial Certificate of the Borrower which certifies, among other things, that an attached extract of resolutions of the Board of Directors of the Borrower approving this Amendment One is true and complete; and 3.1.4 An opinion of counsel to the Borrower in substantially the form annexed hereto as Exhibit 1. 3.2 The Borrower shall pay the reasonable legal fees and disbursements of counsel to the Lenders incurred in connection with the preparation and closing of this Amendment One. 4. EFFECT ON THE CREDIT AGREEMENT. Except as specifically amended above, the Credit Agreement shall remain in full force and effect and is hereby ratified and confirmed. 5. EXECUTION IN COUNTERPARTS. This Amendment One may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an original and all or which taken together shall constitute but one and the same instrument. -16- 3 IN WITNESS WHEREOF, the parties hereto have caused this Amendment One to be executed and delivered by their respective representatives thereunto duly authorized, as of the date first above written. BORROWER Monro Muffler Brake, Inc. By /s/ CATHERINE D'AMICO --------------------------------- Name: Catherine D'Amico Title: Chief Financial Officer and Senior Vice President LENDERS: THE CHASE MANHATTAN BANK By /s/ PHILIP M. HENDRIX --------------------------------- Name: Philip M. Hendrix Title: Vice President FLEET BANK By /s/ JEFFREY S. HOLMES --------------------------------- Name: Jeffrey S. Holmes Title: Vice President AGENT: THE CHASE MANHATTAN BANK, as Agent By /s/ PHILIP M. HENDRIX --------------------------------- Name: Philip M. Hendrix Title: Vice President -17- EX-11 3 EXHIBIT 11 1 Exhibit 11 MONRO MUFFLER BRAKE, INC. STATEMENT OF COMPUTATION OF PER SHARE EARNINGS (UNAUDITED) Earnings per share for each period was computed by dividing net income for such period by the weighted average number of shares of Common Stock and common stock equivalents outstanding during such period. All share data has been restated to reflect the 5% stock dividend payable August 4, 1997. (See Note 1).
QUARTER ENDED JUNE 30, -------- 1997 1996 ---- ---- (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) EARNINGS Net income $3,417 $3,379 ====== ====== SHARES Weighted average number of common shares 7,850 7,670 Assuming conversion of Class C Convertible Preferred Stock 605 605 Dilutive effect of outstanding options 150 265 ------ ------ Weighted average number of common and common equivalent shares 8,605 8,540 ====== ====== EARNINGS PER SHARE $ .40 $ .40 ====== ======
-18- EX-27 4 EXHIBIT 27
5 1,000 3-MOS MAR-31-1998 APR-01-1997 JUN-30-1997 8,022 0 1,069 0 21,533 34,913 157,827 44,377 152,239 26,376 54,010 79 0 138 69,876 152,239 40,773 40,773 22,631 11,492 85 0 868 5,697 2,280 3,417 0 0 0 3,417 .40 .40
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