UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
Date of Report (Date of Earliest Event Reported):
March 27, 2006
MONRO MUFFLER BRAKE, INC.
(Exact name of registrant as specified in its charter)
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| New York
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0-19357
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16-0838627 |
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| (State of Incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification No.) |
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| 200 Holleder Parkway, Rochester, New York
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14615 |
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| (Address of Principal Executive Offices)
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(Zip Code) |
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| Registrant’s telephone number, including area code
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(585) 647-6400 |
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Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |
Item 1.01 Entry into a Material Definitive Agreement
As described in Item 8.01, which is incorporated herein by reference, Monro Muffler Brake, Inc.
(the “Company”) will enter into Resale Restriction Agreements with its executive officers and
certain senior-level managers, effective as of March 24, 2006.
Item 8.01 Other Events
On
March 27, 2006, the Company announced that on March 27,
2006 the Compensation Committee (the “Committee”) of the Company’s Board of Directors
approved the accelerated vesting of all 220,000 unvested options (the “Options”) previously awarded
to the Company’s employees. As a result, these Options to purchase 220,000 shares of the Company’s
common stock, which would otherwise have vested at various times over the next four years, became
fully vested on March 24, 2006. The Options represent
approximately 13% of the total number of
options currently outstanding to the Company’s employees. Further, all of the Options have strike
prices below $38.10, the closing price per share of the Company’s common stock on March 23, 2006.
In connection with the acceleration of the Options, the Company expects to record a one-time
non-cash stock-based compensation charge of approximately $300,000 to $400,000, or $.02 to $.03 per
diluted share, in the fourth quarter of fiscal 2006.
The Committee’s decision to accelerate the vesting of the Options was made to eliminate future
compensation expense that the Company would otherwise recognize with respect to these options
following the Company’s adoption of SFAS 123(R), which became effective for the Company on March
26, 2006. The Company expects that as a result of the vesting acceleration, it will eliminate the
recognition of approximately $900,000 to $1,000,000 of non-cash expense over the next four years,
beginning March 26, 2006. It is anticipated that more than half of the expense reduction would be
attributable to fiscal 2007.
Also in connection with the acceleration of the Options, the Company’s executive officers and
certain senior-level managers (each, an “Executive”) will enter into Resale Restriction Agreements.
Each Agreement will be effective as of March 24, 2006. The Agreement prohibits (except on the
occurrence of a “change of control” of the Company, if applicable) the Executive’s sale or other
transfer of any share received through the exercise of an accelerated Option until the original
vesting date for such Option, as such date is set forth in the Executive’s stock option award
agreement. A copy of the Resale Restriction Agreement is attached as Exhibit 10.1 to this Form 8-K
and is incorporated herein by reference
Item 9.01 Financial Statements and Exhibits
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(a) |
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Not applicable. |
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(b) |
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Not applicable. |