Edgar Filing: MONRO MUFFLER BRAKE INC

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement [ ] CONFIDENTIAL, FOR USE OF THE COMMISSION
ONLY (AS PERMITTED BY RULE 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12.

MONRO MUFFLER BRAKE, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

XXXXXXXXXXXXXXXX
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)

Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1) Title of each class of securities to which transaction applies: .......

(2) Aggregate number of securities to which transaction applies: ..........

(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined): ............

(4) Proposed maximum aggregate value of transaction: ......................

(5) Total fee paid: .......................................................

[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid: ...............................................

(2) Form, Schedule or Registration Statement No.: .........................

(3) Filing Party: .........................................................

(4) Date Filed: ...........................................................

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

MONRO MUFFLER BRAKE, INC.
200 HOLLEDER PARKWAY
ROCHESTER, NEW YORK 14615

---------------

NOTICE OF ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD
AUGUST 6, 2001
---------------

To the Shareholders of
MONRO MUFFLER BRAKE, INC.

The Annual Meeting of Shareholders of Monro Muffler Brake, Inc. (the
"Company") will be held at The Hutchison House, 930 East Avenue, Rochester, New
York 14607, on Monday, August 6, 2001, commencing at 10 a.m., for the following
purposes:

1. to elect five directors to Class 2 of the Board of Directors to serve
a two-year term, and until their successors are duly elected and
qualified at the 2003 annual meeting of shareholders;

2. to ratify the re-appointment of PricewaterhouseCoopers LLP as the
independent auditors of the Company for the fiscal year ending March
31, 2002; and

3. to consider such other business as may properly be brought before the
meeting or any adjournment or postponement thereof.

Only shareholders of record at the close of business on Monday, June 18,
2001, will be entitled to vote at the meeting.

By Order of the Board of Directors

/s/ Robert W. August
--------------------
Robert W. August
Secretary

Rochester, New York
July 6, 2001

PLEASE SIGN, DATE AND RETURN YOUR PROXY PROMPTLY IN THE ENCLOSED,
SELF-ADDRESSED ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES.

1
3

PROXY STATEMENT

MONRO MUFFLER BRAKE, INC.
200 HOLLEDER PARKWAY
ROCHESTER, NEW YORK 14615

---------------

ANNUAL MEETING OF SHAREHOLDERS
AUGUST 6, 2001
---------------

SOLICITATION OF PROXIES

The accompanying proxy is solicited by the Board of Directors of Monro
Muffler Brake, Inc., a New York corporation (the "Company" or "Monro"), for use
at the Annual Meeting of Shareholders (the "Annual Meeting") to be held at The
Hutchison House, 930 East Avenue, Rochester, New York 14607, on Monday, August
6, 2001, commencing at 10 a.m., or at any adjournment or postponement thereof.

A shareholder who executes a proxy may revoke it at any time before it is
voted. Attendance at the meeting shall not have the effect of revoking a proxy
unless the shareholder so attending shall, in writing, so notify the secretary
of the meeting at any time prior to the voting of the proxy. A proxy which is
properly signed and not revoked will be voted for the nominees for election as
directors listed herein, and for the ratification of the re-appointment of
independent auditors as proposed herein, unless contrary instructions are given,
and such proxy may be voted by the persons named in the proxy in their
discretion upon such other business as may be properly brought before the
meeting.

The cost of soliciting proxies will be borne by the Company. In addition to
solicitation by mail, directors, officers and employees of the Company may
solicit proxies by telephone or otherwise. The Company will reimburse brokers or
other persons holding shares in their names or in the names of their nominees
for their charges and expenses in forwarding proxies and proxy material to the
beneficial owners of such shares. It is anticipated that the mailing of this
Proxy Statement will commence on or about July 6, 2001.

VOTING SECURITIES

Only shareholders of record at the close of business on Monday, June 18,
2001 will be entitled to vote. At June 1, 2001, the Company had outstanding
8,158,253 shares of common stock, par value $.01 per share ("Common Stock").
Each share of Common Stock is entitled to one vote on each matter as may
properly be brought before the meeting.

The voting rights of holders of Common Stock are subject to the voting
rights of the holders of 91,727 shares outstanding of the Company's Class C
Convertible Preferred Stock, par value $1.50 per share ("Class C Preferred
Stock"). The vote of the holders of at least 60% of the shares of Class C
Preferred Stock at the time outstanding, voting as a separate class, or,
alternatively, the written consent of the holders of all outstanding shares of
Class C Preferred Stock, is needed to effect or validate any action approved by
a vote of the holders of shares of Common Stock. Therefore, such preferred
shareholders have an effective veto over all matters put to a vote of common
shareholders, and such veto power could be used, among other things, to block
the election of directors, the ratification of the appointment of auditors, or
any other transaction that the holders of Common Stock might otherwise approve
at the Annual Meeting. It is expected that the holders of Class C Preferred
Stock will approve, by unanimous written consent, all matters currently proposed
to be put to a vote of common shareholders at the Annual Meeting.

With regard to the election of directors, votes may be cast in favor of or
withheld from each nominee. Director nominees must receive a plurality of the
votes cast at the meeting to be elected. Votes that are withheld from any
nominee are counted as present for purposes of determining the existence of a
quorum but are not deemed cast at the meeting and, thus, have no effect on the
determination of a plurality. Abstentions may be

2
4

specified on proposals other than the election of directors, which proposals
require a majority of the votes cast at the meeting for approval. Abstentions
will be counted as present for purposes of determining the existence of a quorum
but are not deemed cast at the meeting and, thus, have no effect on the
determination of a majority. With respect to shares of Common Stock held in
street name, where no vote is indicated on a matter because the nominee or
broker lacks authority to vote such shares without specific instructions from
the beneficial owner, and the nominee or broker has received no such
instructions (a "broker non-vote"), such shares are not counted as present for
the purpose of determining the existence of a quorum and are not counted as
votes cast with respect to any such matter.

ELECTION OF DIRECTORS

The Board of Directors of the Company is divided into two classes having
terms which expire at the Annual Meeting (Class 2) and at the 2002 annual
meeting of shareholders (Class 1). The five Class 2 directors are proposed for
re-election at the Annual Meeting.

CURRENT NOMINEES

It is proposed to elect at the Annual Meeting five persons to Class 2 of
the Board of Directors to serve (subject to the Company's by-laws) until the
election and qualification of their successors at the 2003 annual meeting of
shareholders. If any such person should be unwilling or unable to serve as a
director of the Company (which is not anticipated), the persons named in the
proxy will vote the proxy for substitute nominees selected by them unless the
number of directors has been reduced to the number of nominees willing and able
to serve.

The following summarizes biographical information for the Class 2
directors, each of whom is nominated for re-election:

Charles J. August, 82, was elected to the Board of Directors in February
1959. He founded the predecessor to the Company in 1957 and served as the
Company's Chairman, President and Chief Executive Officer until October 1987,
when he retired.

Frederick M. Danziger, 61, was elected to the Board of Directors in July
1984. He is President of Griffin Land & Nurseries, Inc. Mr. Danziger was
previously of counsel in the law firm of Latham & Watkins from 1995 to 1997, and
was a partner of the law firm of Mudge Rose Guthrie Alexander & Ferdon from 1974
to 1995. Mr. Danziger is a director of Bloomingdale Properties, Inc. and Centaur
Communications, Ltd.

Jack M. Gallagher, 64, was elected to the Board of Directors in October
1987. He has been Director of Special Projects of the Company since January 1,
1999 and from April 1995 to February 1998. Mr. Gallagher was interim President
and Chief Executive Officer of the Company from February 1998 through December
1998 and President and Chief Executive Officer from October 1987 through March
1995. Prior to joining the Company, Mr. Gallagher was President of Auto Works, a
240-store chain of discount auto parts stores headquartered in Pontiac,
Michigan, from May 1985 to October 1987. Mr. Gallagher has held various other
positions in the auto parts and service industries, including 20 years with
Firestone Tire & Rubber Co., where he was Chief Executive of the Fidesta
Company, a 200-store nationwide chain of tire and service centers.

Robert G. Gross, 43, was elected to the Board of Directors in February
1999. He has been President and Chief Executive Officer since January 1, 1999.
Prior to joining the Company, Mr. Gross was Chairman and Chief Executive Officer
of Tops Appliance City, Inc., a consumer electronics and appliance store chain
based in Edison, New Jersey, from 1995 to 1998. Mr. Gross also held various
management positions with Eye Care Centers of America, Inc., a San Antonio,
Texas based optometry company owned by Sears, Roebuck & Co., including President
and Chief Operating Officer from 1992 through 1994, Executive Vice President and
Chief Operating Officer from 1991 through 1992 and Senior Vice President from
1990 through 1991.

Peter J. Solomon, Chairman of the Board, 62, was elected to the Board of
Directors in July 1984. He has been Chairman of the Board of Directors of Peter
J. Solomon Company Limited, an investment banking firm, since May 1989. From
1985 to May 1989, he was a Vice Chairman and a member of the board of directors
of Shearson

3
5

Lehman Hutton, Inc. Mr. Solomon is a director of Office Depot, Inc.,
Phillips-Van Heusen Corporation and Baker, Fentress & Company.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE NOMINEES FOR
DIRECTOR.

The following summarizes biographical information for each of the
continuing Class 1 directors:

Burton S. August, 86, was elected to the Board of Directors in May 1969. He
was a Vice President of the Company until May 1980, when he retired. Mr. August
has been a director of Home Properties of New York since August 4, 1994.

Robert W. August, 49, was elected to the Board of Directors in July 1982.
He has been Senior Vice President - Store Support since October 1996 and
Secretary since July 1984. Mr. August was Senior Vice President - Marketing from
May 1992 through October 1996, Vice President - Marketing from July 1989 to May
1992, Executive Vice President from 1984 through July 1989, and has worked for
Monro in various other capacities since 1968.

Donald Glickman, 68, was elected to the Board of Directors in July 1984. He
is a private investor and has been a partner of J.F. Lehman & Company, an
investment banking firm, since January 1992. He was an executive employee of
Peter J. Solomon Company Limited, an investment banking firm, from July 1989 to
June 1992. From July 1988 to July 1989, he was a managing director of Lehman
Brothers (Shearson Lehman Hutton, Inc.) Prior to July 1988, Mr. Glickman was a
Senior Vice President of the First National Bank of Chicago. Mr. Glickman is a
director of Burke Industries, Inc., MacNeal Schwendler Corporation and SDI,
Inc., and a trustee of MassMutual Corporate Investors and MassMutual
Participation Investors. He is Chairman of Elgar Electronics.

Lionel B. Spiro, 62, was elected to the Board of Directors in August 1992.
He was the Chairman and President of Charrette Corporation of Woburn,
Massachusetts, a distributor of design supplies and imaging services, until July
1997, when he retired. Mr. Spiro co-founded Charrette Corporation in 1964.

W. Gary Wood, 50, was elected to the Board of Directors in February 1993.
Mr. Wood currently is an independent business owner with operations in computer
services and specialty manufacturing. He was a principal with Deloitte & Touche
(in Michigan), an accounting, tax and consulting firm, from 1984 through 1993 in
the management consulting practice, and has extensive experience in retail
strategy and operations.

EXECUTIVE OFFICERS

The name and business experience of each of the executive officers of
the Company, as of June 1, 2001, is set forth below to the extent not provided
above:

Catherine D'Amico, 45, has been Senior Vice President - Finance, Chief
Financial Officer and Treasurer since August 1993. Ms. D'Amico, a certified
public accountant, was previously a Senior Audit Manager with Price Waterhouse
(PricewaterhouseCoopers LLP) in Rochester, New York and was affiliated with such
firm from 1978 to 1993.

Thomas J. Budreau, 44, has been Divisional Vice President - Eastern
Operations since December 1998. From October 1995 to November 1998, Mr. Budreau
was Vice President - Eastern Operations. Prior to joining the Company, Mr.
Budreau was the National Auto Express Service Manager for Montgomery Ward & Co.,
Incorporated ("Montgomery Ward") from March 1994 to October 1995. From November
1990 to March 1994, Mr. Budreau was a Regional Auto Express Manager for
Montgomery Ward. From 1975 to November 1990, Mr. Budreau held various other
management positions with Montgomery Ward.

Christopher R. Hoornbeck, 50, has been Divisional Vice President - Western
Operations since December 1998. From October 1996 to November 1998, Mr.
Hoornbeck was a Zone Manager and has worked for Monro in various other
capacities since 1973.

4
6

SECURITY OWNERSHIP OF PRINCIPAL SHAREHOLDERS, DIRECTORS AND EXECUTIVE OFFICERS

The following table shows the number of shares of Common Stock and Common
Stock equivalents beneficially owned as of June 1, 2001 by (i) each person or
entity known to the Company to be the beneficial owner of more than five percent
of the Common Stock, (ii) each Class 2 director, each of whom is nominated for
re-election, (iii) each continuing Class 1 director, (iv) the executive officers
named in the Summary Compensation Table and (v) all directors and executive
officers as a group. Unless otherwise indicated, each of the named individuals
and each member of the group has sole voting power and sole investment power
with respect to the shares shown.

COMMON STOCK PERCENT OF
BENEFICIALLY OPTION SHARES CLASS
5% SHAREHOLDERS, DIRECTORS AND OWNED EXERCISABLE INCLUDING
EXECUTIVE OFFICERS EXCLUDING OPTIONS WITHIN 60 DAYS OPTIONS
------------------ ----------------- -------------- -------

Peter J. Solomon 1,440,676(1) 21,273(9) 16.9
767 Fifth Avenue
New York, NY 10153
Wellington Management Company, LLP 689,200(5) 8.4
75 State Street
Boston, MA 02109
FMR Corp. 647,500(2) 7.9
82 Devonshire Street
Boston, MA 02109
Paradigm Capital Management, Inc. 613,712(3) 7.5
9 Elk Street
Albany, NY 12207
Donald Glickman 589,049(4) 21,273(9) 7.5
2001 Jefferson Davis Highway
Arlington, VA 22202
Dimensional Fund Advisors 473,274(6) 5.8
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401
Robert W. August 326,871(7) 9,125 4.1
Jack M. Gallagher 102,671(8) 136,407 2.9
Charles J. August 204,949(7) 21,273(9) 2.8
Robert G. Gross 109,000 112,500 2.7
Burton S. August 70,348(7) 21,273(9) 1.1
Christopher R. Hoornbeck 26,006 12,078 *
Catherine D'Amico 1,514 33,804 *
Frederick M. Danziger 13,226 21,273(9) *
W. Gary Wood 4,432 21,273(9) *
Lionel B. Spiro 4,149 21,273(9) *
Thomas J. Budreau 0 10,421 *
All directors and executive officers 2,814,687 463,246 36.1(10)
as a group (13 persons)

---------------

* Less than 1% of the shares deemed outstanding.

(1) Includes 65,000 shares of Class C Preferred Stock (including 45,000 shares
held in trust for the benefit of Mr. Solomon's children for which Mr.
Solomon is trustee) presently convertible into 450,466 shares of Common
Stock. Mr. Solomon disclaims beneficial ownership of all such shares held
in trust. Also includes 878,845 shares of Common Stock held in trusts for
the benefit of Mr. Solomon's children for which Mr. Solomon is the trustee.
Mr. Solomon disclaims beneficial ownership of all such shares held in
trust.

5
7

Excludes 26,727 shares of Class C Preferred Stock held by Richard H.
Solomon, Mr. Solomon's brother. Peter J. Solomon disclaims beneficial
ownership of such shares. Peter J. Solomon is a principal shareholder and a
Class 2 director.

(2) Beneficial ownership reported as of December 31, 2000, according to a
statement on Schedule 13G, dated February 14, 2001, of FMR Corp., a parent
holding company of Fidelity Management & Research Company, a registered
investment adviser.

(3) Beneficial ownership reported as of December 31, 2000, according to a
statement on Schedule 13G, dated January 30, 2001, of Paradigm Capital
Management, Inc., a registered investment adviser.

(4) Excludes shares of Common Stock owned by Mr. Glickman's children. Mr.
Glickman disclaims beneficial ownership of such shares. Mr. Glickman is a
principal shareholder and a Class 1 director.

(5) Beneficial ownership reported as of December 31, 2000, according to a
statement on Schedule 13G, dated February 14, 2001, of Wellington
Management Company, LLP, a registered investment adviser.

(6) Beneficial ownership reported as of December 31, 2000, according to a
statement on Schedule 13G, dated February 2, 2001, of Dimensional Fund
Advisors Inc., a registered investment adviser.

(7) Includes 39,102 shares of Common Stock held in The Charles J. and Burton S.
August Family Foundation, a charitable trust for which Mr. August is a
trustee. Mr. August disclaims beneficial ownership of such shares held in
trust.

(8) Includes 32,750 shares held in trust for the benefit of Mr. Gallagher's
children for which Mr. Gallagher is trustee. Mr. Gallagher disclaims
beneficial ownership of such shares held in trust.

(9) Options granted pursuant to the Non-Employee Directors' Stock Option Plan.

(10) Exclusive of shares as to which beneficial ownership has been disclaimed,
officers and directors of the Company as a group owned beneficially
approximately 22.2% of Common Stock deemed outstanding on June 1, 2001.

OTHER INFORMATION CONCERNING DIRECTORS

Burton S. August and Charles J. August are brothers. Burton S. August is
the father of Robert W. August.

EMPLOYMENT AGREEMENTS AND CHANGE-IN-CONTROL ARRANGEMENTS

The Company entered into an employment agreement (the "Agreement") in
November 1998 with Robert G. Gross, its President and Chief Executive Officer.
The Agreement, which provides for a base salary of $420,000, plus a bonus,
subject to the discretion of the Compensation Committee, has a five-year term
ending December 1, 2003. The Agreement includes a covenant against competition
with the Company for two years after termination. The Agreement provides the
executive with a minimum of one year's salary and certain additional rights in
the event of a termination without cause (as defined therein), or a termination
in the event of change in control (as defined therein).

Jack M. Gallagher entered into an employment agreement with the Company
through February 2003, pursuant to which he serves as Director of Special
Projects of the Company. In such capacity, Mr. Gallagher is responsible for,
among other things, finding, investigating and negotiating with acquisition
candidates, and advising and consulting with respect to investor and shareholder
relations. As compensation for such services, Mr. Gallagher is paid a salary of
$24,000 per year. During the term of the Agreement and for two years after
termination, Mr. Gallagher has agreed not to compete in any manner with the
business of the Company.

The Company entered into an employment agreement in December 2000 with
Catherine D'Amico, its Chief Financial Officer. The Agreement provides a base
salary of $140,000, to be reviewed annually, plus a bonus, subject to the
discretion of the Compensation Committee. The Agreement has a 30 month term
ending May 31, 2003, and includes a covenant against competition with the
Company for two years after termination. The Agreement provides Ms. D'Amico with
a minimum of one year's salary and certain additional rights in the event of a
termination without cause (as defined therein), or a termination in the event of
a change in control (as defined therein).

6
8

MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES

The Board of Directors held four meetings during fiscal 2001(1). During the
fiscal year, each director attended at least 75% of the aggregate number of all
meetings of the Board of Directors and committees on which he served.
Non-employee directors of the Company receive directors' fees at the rate of
$2,000 per year plus $750 per meeting attended. All directors are reimbursed for
actual expenses incurred in connection with attendance at meetings of the Board
of Directors or committees thereof. In addition, each non-employee director
receives an annual grant of an option to purchase 3,039 shares of Common Stock.

The Board of Directors has created four standing committees: a four-member
Governance Committee, a four-member Audit Committee, a four-member Compensation
and Benefits Committee (the "Compensation Committee") and a four-member Stock
Option Committee.

The Governance Committee has and may exercise, between meetings of the
Board of Directors, all the power and authority of the full Board of Directors,
subject to certain exceptions. During fiscal 2001, the Governance Committee held
no meetings. Its members are Robert W. August, Donald Glickman, Robert G. Gross
and Peter J. Solomon.

The Audit Committee has the power and authority to select and engage
independent auditors for the Company, subject to the approval of shareholders,
and reviews with the auditors and with the Company's management all matters
relating to the annual audit of the Company. The Audit Committee held six
meetings in fiscal 2001. It consists of four members: Frederick M. Danziger,
Lionel B. Spiro and W. Gary Wood, each of whom is an independent director, and
Donald Glickman who is not independent. Donald Glickman receives payments from
Peter J. Solomon Company Limited, a firm with which the Company has a management
agreement. (See "Compensation Committee Interlocks and Insider Participation".)
The Board of Directors believes that the Audit Committee benefits from Mr.
Glickman's strong financial background.

The Compensation Committee has the power and authority to review and
approve the remuneration arrangements for executive officers and employees of
the Company and to select participants, approve awards under, interpret and
administer the employee benefit plans of the Company (other than stock option
plans). The Compensation Committee held two meetings in fiscal 2001. Its members
are Donald Glickman, Robert G. Gross, Peter J. Solomon and Lionel B. Spiro.

The Stock Option Committee has the power and authority to select
participants and approve awards under, and to interpret and administer or
otherwise act with respect to, the Company's stock option plans. During fiscal
2001, the Stock Option Committee met one time. Its members are Charles J.
August, Jack M. Gallagher, Donald Glickman and Peter J. Solomon.

AUDIT COMMITTEE REPORT

The Audit Committee of the Board of Directors (the "Committee") is composed
of four non-employee directors and operates under a written charter adopted by
the Board of Directors (Exhibit A).

Management is responsible for the Company's internal controls and the
financial reporting process. The external auditors are responsible for
performing an independent audit of the Company's consolidated financial
statements in accordance with generally accepted auditing standards and to issue
a report thereon. The committee's responsibility is to monitor and oversee these
processes.

-------------------

(1) References in this Proxy Statement to fiscal years are to the Company's
fiscal years ending or ended March 31 of each year (e.g., references to
"fiscal 2001" are to the Company's fiscal year ended March 31, 2001).

7
9

In this context, the Committee has met and held discussions with management
and the external auditors. Management represented to the Committee that the
Company's consolidated financial statements were prepared in accordance with
generally accepted accounting principles, and the Committee has reviewed and
discussed the consolidated financial statements with management and the external
auditors. The Committee discussed with the external auditors matters required to
be discussed by Statement on Auditing Standards No. 61 (Communication with Audit
Committees).

The Company's external auditors also provided to the Committee the written
disclosures required by Independence Standards Board Standard No. 1
(Independence Discussions with Audit Committees), and the Committee discussed
with the external auditors that firm's independence.

Based on the Committee's discussion with management and the external
auditors and the Committee's review of the representation of management and the
report of the external auditors to the Committee, the Committee recommended to
the Board of Directors, and the Board has approved, that the audited
consolidated financial statements be included in the Company's Annual Report on
Form 10-K for the year ended March 31, 2001, for filing with the Securities and
Exchange Commission. The Committee and the Board also have approved, subject to
shareholder ratification, the selection of the Company's external auditors.

Audit Committee

W. Gary Wood (Chairman)
Frederick M. Danziger
Donald Glickman
Lionel Spiro

8
10

EXECUTIVE COMPENSATION

The following table sets forth, for the Company's last three fiscal years,
the annual and long-term compensation of those persons who were, at March 31,
2001, (i) the Chief Executive Officer and (ii) the other four most highly
compensated executive officers of the Company (the "Named Officers"):

SUMMARY COMPENSATION TABLE
LONG TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
----------------------------------------- ---------------
NAME AND FISCAL YEAR ALL OTHER
PRINCIPAL ENDED SALARY BONUS OPTIONS COMPENSATION (1)
POSITION MARCH 31, ($) ($) (#) ($)
--------- ----------- ------ ------ ------ ---------------

Robert G. Gross 2001 420,000 264,600 0 111,420
President and 2000 420,000 0 0 158,985
Chief Executive Officer (2) 1999 112,500 150,000 425,000 0

Robert W. August 2001 150,400 39,375 5,000 3,258
Senior Vice President - 2000 150,400 0 0 197
Store Support, and Secretary 1999 150,400 0 10,500 538

Catherine D'Amico 2001 140,000 36,750 0 3,017
Senior Vice President - 2000 130,000 0 20,000 170
Finance, and Chief Financial Officer 1999 130,000 0 10,500 551

Thomas J. Budreau 2001 115,400 24,150 5,000 2,492
Divisional Vice President - 2000 110,404 0 0 53,905
Eastern Operations 1999 97,068 0 5,000 8,980

Christopher R. Hoornbeck 2001 115,400 24,150 5,000 375
Divisional Vice President - 2000 110,404 0 0 38,899
Western Operations 1999 97,068 0 6,050 842

----------

(1) For most officers, All Other Compensation represents the Company's 401(k)
matching or other contributions to the Monro Muffler Brake, Inc. Profit
Sharing Plan for the accounts of the Named Officers.

For Mr. Gross, All Other Compensation includes $104,595 of forgiveness of
principal due on the loan described in "Compensation Committee Interlocks
and Insider Participation", for fiscal 2001 and fiscal 2000. Fiscal 2000
also includes reimbursement of $54,390 for relocation expenses.

For Messrs. Budreau and Hoornbeck, All Other Compensation for fiscal 2000
includes reimbursement for relocation expenses of $53,760 and $38,754,
respectively.

For Mr. Budreau, All Other Compensation for fiscal 1999 includes $8,638 for
relocation expenses.

For Mr. Hoornbeck, All Other Compensation for fiscal 1999 includes $500 for
sales contests.

(2) Mr. Gross joined the Company in December 1998.

9
11

OPTION GRANTS IN LAST FISCAL YEAR

The following table sets forth, for the Company's fiscal year ended March
31, 2001, information concerning the granting of options to the Named Officers:

INDIVIDUAL GRANTS POTENTIAL REALIZABLE
-------------------------------------------------------------------- VALUE ASSUMING RATES
% OF TOTAL OF STOCK PRICE
OPTIONS EXERCISE APPRECIATION OF
OPTIONS GRANTED IN PRICE EXPIRATION ---------------------------
NAME (#) (2) FISCAL YEAR (3) ($/SH) DATE 5% (1) $ 10% (1)$
---- ------- --------------- ------ ---------- -------- --------

Robert G. Gross 0 -- -- -- -- --
Robert W. August 5,000 5.36 8.00 4/07/10 25,156 63,750
Catherine D'Amico 0 -- -- -- -- --
Thomas J. Budreau 5,000 5.36 8.00 4/07/10 25,156 63,750
Christopher R.
Hoornbeck 5,000 5.36 8.00 4/07/10 25,156 63,750
---------------

(1) These values are calculated by comparing the exercise price of such options
to the market value of the shares of Common Stock subject to such options,
assuming that the market price of such shares increases by 5% and 10%,
respectively, during each year of the options' term. Actual gains, if any,
on the stock option exercises are dependent on the future performance of
the Common Stock and overall stock conditions, as well as the option
holder's continued employment through the vesting period. The value stated
may not necessarily be achieved.

(2) Options granted in fiscal 2001 under the Company's 1998 Employees'
Incentive Stock Option Plan. Subject to certain conditions, 25% of such
options become exercisable each year beginning one year after the date of
grant.

(3) Based on a total of 93,250 options granted to 178 employees of the Company
in fiscal 2001.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES

The following table sets forth, for the Company's fiscal year ended March
31, 2001, information concerning the exercise of options by the Named Officers
and the value of unexercised options of the Named Officers:

NUMBER OF TOTAL NUMBER TOTAL VALUE OF
SHARES OF UNEXERCISED OPTIONS UNEXERCISED, IN-THE-MONEY
ACQUIRED ON VALUE HELD AT OPTIONS HELD AT
EXERCISE REALIZED MARCH 31, 2001 MARCH 31, 2001
NAME (#) ($) (#) ($)
---- -------- -------- ------------------------------ ----------------------------
EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- ------------- ----------- -------------

Robert G. Gross 0 0 112,500 312,500 344,813 957,813
Robert W. August 0 0 5,250 10,250 0 14,375
Catherine D'Amico 0 0 31,178 21,352 11,875 35,625
Thomas J. Budreau 0 0 8,950 7,941 3,113 17,488
Christopher R. Hoornbeck 0 0 10,564 8,025 3,113 17,488
---------------

10
12

COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

The Compensation Committee of the Board of Directors is responsible for
setting the Chief Executive Officer's compensation and making annual
recommendations for the compensation of the other executive officers to the full
Board of Directors after considering recommendations made by the Chief Executive
Officer.

Executive compensation is a mix of salary, annual bonus awarded under the
executive bonus plan, Company contributions to the profit sharing plan and
pension plan, long-term compensation in the form of stock options and other
benefits generally available to all employees. The Company relies to a large
degree on bonus, stock options and stock ownership to attract and retain
executives of outstanding ability and to motivate them to work to their fullest
potential. Under the executive bonus plan, the Compensation Committee seeks to
enhance the profitability of the Company by aligning closely the financial
interest of the Company's executives with those of its shareholders through the
payment of bonuses based on attainment of profit targets. In setting base
salaries, the Company refers to the National Executive Compensation Survey
published by The Management Association of Illinois.

The Chief Executive Officer's fiscal 2001 compensation consisted of a base
salary of $420,000 in accordance with his employment agreement (see also
"Employment Agreements and Change-in-Control Arrangements"), a bonus of $264,600
and other benefits extended to all full-time employees. Mr. Gross's bonus, which
may reach a maximum of 200% of his base salary, is based on the Company's
attainment of specific profit targets for fiscal 2001. Mr. Gross did not receive
a bonus for fiscal 2000 because the Company did not attain the minimum required
percentage of targeted profit performance set by the Compensation Committee. In
fiscal 1999, in connection with his joining the Company, Mr. Gross received a
$150,000 signing bonus. The Chief Executive Officer does not participate in the
Compensation Committee's determination of his compensation.

The salaries of other executive officers are set at amounts the Company
believes to be comparable to those paid to executives holding similar positions
at other automotive service companies of comparable size. Bonuses are paid based
on attainment of profit targets, which were achieved in fiscal 2001. Executive
officers did not receive profit-based bonuses for fiscal 2000 and 1999 because
the Company did not attain the minimum required percentage of targeted profit
performance.

All employees, including executive officers, may receive stock options from
time to time under the Company's stock option plans. Stock option grants are
recommended by the Stock Option Committee of the Board of Directors, a committee
composed primarily of non-management directors. The stock option grant size is
based upon the individual's overall compensation package, job performance,
future potential, awards made to executives at comparable companies and other
factors. Under the stock option plans, 544,585 shares are currently available
for grants to employees. During fiscal 2001, the Stock Option Committee granted
options, including 5,000 to Robert W. August, Senior Vice President - Store
Support and Secretary; 5,000 to Thomas J. Budreau, Divisional Vice President -
Eastern Operations; and 5,000 to Christopher R. Hoornbeck, Divisional Vice
President - Western Operations.

Options exercisable for an aggregate of 21,273 shares were also granted to
seven non-employee directors of the Company under the terms of the Non-Employee
Directors' Stock Option Plan approved by shareholders in August 1995 and amended
in fiscal 1998 and 2000.

The executive officers participate in the Company's qualified, profit
sharing/401(k) and pension plans on the same basis as all other employees. The
Company offers health care, life insurance, disability insurance and other
benefits to the executive officers on substantially the same terms as available
to all employees of the Company. The amount of perquisites received by any
executive officer in fiscal 2001 did not exceed $50,000 or ten percent of his or
her cash compensation.

The federal income tax laws impose limitations on the deductibility of
compensation in excess of $1 million paid to executive officers in certain
circumstances. The Compensation Committee intends that all compensation paid to
executive officers in fiscal 2001 will be deductible by the Company under such
tax laws.

11
13

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

In December 1998, the Company loaned $523,000 to Robert G. Gross, its
President and Chief Executive Officer, to purchase 75,000 shares of the
Company's common stock at the then fair market value. This loan, which bears an
interest rate of 5.5% per annum, matures on December 1, 2003, and requires five
equal annual installments of principal beginning on the first anniversary of the
loan. If the Executive is employed with the Company when a principal payment is
due, that installment will be forgiven by the Company. All interest is due on
the fifth anniversary of the loan, and shall also be forgiven if the Executive
is employed with the Company at that time. The loan is secured by the common
stock.

The members of the Compensation Committee are Donald Glickman, Robert G.
Gross, Peter J. Solomon and Lionel B. Spiro.

In June 1991, the Company entered into a management agreement effective
July 1, 1991, with Peter J. Solomon Company Limited ("PJSC") pursuant to which
PJSC provides to the Company strategic and financial advice relating to
financing, capital structure, mergers and acquisitions and offensive/defensive
positioning, for a fee of $160,000 per year (plus reimbursement of out-of-pocket
expenses). Pursuant to such agreement, the Company has agreed to indemnify PJSC
against certain liabilities. In addition, PJSC, from time to time, provides
additional investment banking services to the Company for customary fees. The
firm provided financial advisory services to the Company for fees of
approximately $1 million in fiscal 1999 in connection with the acquisition of
and financing for 203 stores acquired from SMK Speedy International Inc. No
additional fees were paid in fiscal 2000 or 2001. Peter J. Solomon, Chairman of
the Board and principal shareholder of the Company, is Chairman of PJSC. Of the
fees paid by the Company to PJSC, approximately half were paid to Donald
Glickman, a director and principal shareholder of the Company, by PJSC for
consulting services.

12
14

PERFORMANCE GRAPH

Set forth below is a line-graph presentation comparing the cumulative
shareholder return on the Company's Common Stock, on an indexed basis, against
the cumulative total returns of the S&P 400 Index and the S&P Retail
Stores-Specialty Index for the sixty month period from March 31, 1996 to March
31, 2001 (March 31, 1996 = 100):

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG MONRO MUFFLER BRAKE, INC., THE S&P INDUSTRIALS INDEX
AND THE S&P RETAIL (SPECIALTY) INDEX

MONRO MUFFLER BRAKE INC.

Cumulative Total Return
------------------------------------------------------
3/96 3/97 3/98 3/99 3/00 3/01

MONRO MUFFLER BRAKE, INC. 100.00 109.10 114.56 51.55 60.15 78.68
S&P INDUSTRIALS 100.00 118.99 174.22 213.32 261.18 186.92
S&P RETAIL (SPECIALTY) 100.00 105.37 119.08 104.48 68.65 65.57

*$100 INVESTED ON 3/31/96 IN STOCK OR INDEX-
INCLUDING REINVESTMENTS OF DIVIDENDS.
FISCAL YEAR ENDING MARCH 31.

13
15

PENSION PLAN

The Company sponsors a noncontributory retirement plan which is intended to
qualify under Section 401(a) of the Internal Revenue Code of 1986, as amended
(the "Pension Plan"). As of September 30, 1999, participants ceased to accrue
benefits under the Pension Plan and no employees will become plan participants
after this date. Compensation and services after this date are not taken into
consideration in determining benefits under the Pension Plan. Prior to September
30, 1999, each employee who attained age 21 became a participant on the April 1
or October 1 following the date the employee completed one year of service.
Benefit payments generally begin upon retirement at age 65 or age 60 with 20
years of service.

Benefits under the Pension Plan are 100% vested in each participant upon
completion of five years of service, attainment of age 65 or the termination of
the Pension Plan. Lump sum distributions are available at termination or
retirement only for accrued benefits of $5,000 or less.

The following table shows the estimated annual benefits payable to
participants under the Pension Plan upon retirement at age 65. The table does
not show the reduction for Social Security benefits (see formula below).

PENSION PLAN TABLE

Average Compensation Number of Years of Service
-------------------- ------------------------------------------------------------------------------
(Prior to September 30, 1999)

5 10 15 20 25
-------- -------- -------- -------- --------

$100,000 $ 22,500 $ 45,000 $ 45,000 $ 45,000 $ 45,000
80,000 18,000 36,000 36,000 36,000 36,000

For the purpose of determining amounts payable under the Pension Plan for
each of the named executives, compensation includes the average of ten years (i)
base salary (including the amount of any reductions in the executive's otherwise
payable compensation attributable to any "cafeteria plan") plus (ii) cash
bonuses. For the last three years, the base salaries and bonuses of each named
executive are shown in the Summary Compensation Table. Compensation does not
include stock options ("Long Term Compensation" column) or the Company's
contributions to the Profit Sharing Plan ("All Other Compensation" column) shown
in the Summary Compensation Table. Compensation is limited to $100,000 for
determining amounts payable under the Pension Plan.

The following are the years of credited service as of September 30, 1999
(rounded to the nearest year) under the Pension Plan for each of the named
executives: Robert G. Gross - 0 years; Robert W. August - 26 years; Catherine
D'Amico - 7 years; Thomas J. Budreau - 5 years; and Christopher R. Hoornbeck -
27 years.

The basic benefit under the Pension Plan is a straight life annuity.
Subject to certain limits required by law, benefits are payable monthly in an
amount equal to (i) 45% of a participant's average monthly earnings for the
highest ten consecutive years prior to September 30, 1999, less (ii) 45% of the
monthly primary Social Security benefit payable to the participant at
retirement. The amount of the benefit is also reduced for short service
participants and participants terminating employment prior to retirement.

Due to the fact that the Pension Plan was frozen as of September 30, 1999,
the amount of the benefit will be multiplied by a fraction (not greater than
one), the numerator of which is the participant's total number of years of
service as of September 30, 1999, and the denominator of which is the number of
years of service the participant would have accumulated if he had continued his
employment until the earlier of (i) age 65 or (ii) the date after age 60 but
before age 65 on which the participant has at least 20 years of vesting service
under the Pension Plan.

PROFIT SHARING PLAN

The Company sponsors a profit sharing plan with a 401(k) feature (the
"Profit Sharing Plan"). The Profit Sharing Plan is intended to qualify under
Section 401(a) of the Internal Revenue Code of 1986, as amended.

Each employee who has attained age 21 becomes a participant as of the first
day of the month following completion of three months of service. Participants
may elect to reduce their compensation by up to the lesser of 15% of their
annual compensation or the statutorily prescribed annual limit ($10,500 in 2001)
and to have the amount of the reduction

14
16

contributed to their account in the Profit Sharing Plan. One of the investment
options available to participants is the Company's stock.

The Company may make discretionary matching contributions to the matching
accounts of those employees who are contributing to the Profit Sharing Plan. The
Board approves matching contributions quarterly. A discretionary Company profit
sharing contribution may also be made on an annual basis.

CERTAIN TRANSACTIONS
AFFILIATE LEASES

The Company leases 40 stores from Charles J. August, Burton S. August and
others or partnerships or trusts in which such persons or members of their
families, including Robert W. August, have interests. In fiscal 2001, the
Company paid or accrued $1,685,000 as rent for these stores, and $9,000 for a
store that closed in August 2000. As of June 1, 2001, most of these properties
were subject to mortgages or notes under which such persons or entities were
obligated. Charles J. August, Burton S. August and Robert W. August are
directors of the Company.

The Company has not entered into any affiliate leases, other than renewals
or modifications of existing leases, since May 1989, and as a matter of policy,
will not do so.

(See also "Compensation Committee Interlocks and Insider Participation").

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's directors and executive officers, and
persons who beneficially own more than ten percent of the Company's Common
Stock, to file with the Securities and Exchange Commission (the "SEC") initial
reports of ownership and reports of changes in ownership of Common Stock.
Officers, directors and greater than ten-percent shareholders are required by
SEC regulations to furnish the Company with copies of all Section 16(a) forms
they file.

To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during fiscal 2001, all Section 16(a) filing requirements
applicable to its officers, directors and greater than ten-percent beneficial
owners were complied with, except that Robert W. August, Senior Vice President -
Store Support and Secretary, reported a sale of 2,000 shares of Common Stock on
a Form 4 that was filed late.

APPROVAL OF AUDITORS

Subject to ratification by shareholders at the Annual Meeting, the Board of
Directors, upon recommendation of the Audit Committee, has re-appointed
PricewaterhouseCoopers LLP as independent auditors to audit the books and
accounts of the Company for fiscal 2002. A representative of
PricewaterhouseCoopers LLP will be present at the Annual Meeting to respond to
questions and will have an opportunity to make a statement if he or she desires
to do so.

Aggregate fees billed to the Company for services rendered by
PricewaterhouseCoopers LLP for fiscal 2001 were:

Annual Audit Fees, including quarterly reviews $ 64,000
Financial Information Systems Design and Implementation 0

All Other Fees:
Actuarial and Benefit Plan Services $ 52,900
Tax Services 45,400
Fixed Asset Depreciation Optimization Study 212,500
--------
Total all other fees $310,800
========

15
17

The Audit Committee has considered whether the non-audit services provided
by PricewaterhouseCoopers LLP are compatible with PricewaterhouseCoopers LLP
maintaining its independence.

THE BOARD OF DIRECTORS RECOMMENDS THE SHAREHOLDERS VOTE FOR RATIFICATION OF
THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP.

SHAREHOLDER PROPOSALS

Proposals of shareholders that are intended to be presented at the annual
meeting to be held in 2002 must be received by the Company by March 8, 2002 in
order that they may be considered for inclusion in the proxy statement and form
of proxy relating to that meeting. The Company's Certificate of Incorporation
provides that shareholders who do not present a proposal for inclusion in the
proxy statement, but who still intend to submit the proposal at the 2002 annual
meeting, and shareholders who intend to submit nominations for directors at the
meeting, are required to deliver or mail the proposal or nomination to the
Secretary of the Company, Monro Muffler Brake, Inc., 200 Holleder Parkway,
Rochester, New York 14615, so that the Secretary receives the proposal or
nomination not less than 120 days nor more than 180 days prior to the meeting,
except that if less than 50 days notice or prior public disclosure of the
meeting date is given or made to shareholders, the Secretary must receive such
proposal or nomination not later than the close of business on the tenth day
following the day on which notice of the meeting was mailed or such public
disclosure was made, whichever first occurs. Each proposal or nomination must
set forth the information required by the Certificate of Incorporation. If the
chairman of the meeting determines that a proposal or nomination was not made in
accordance with the required procedures, such proposal or nomination will be
disregarded. Additional information and a copy of the Certificate of
Incorporation may be obtained by submitting a written request to the Secretary
of the Company.

ADDITIONAL INFORMATION

THE COMPANY WILL FURNISH TO ANY SHAREHOLDER, UPON WRITTEN REQUEST, A
COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED MARCH
31, 2001, AS FILED WITH THE SEC, WITHOUT CHARGE, EXCEPT THAT COPIES OF ANY
EXHIBIT TO SUCH REPORT WILL BE FURNISHED UPON PAYMENT BY SUCH SHAREHOLDER OF THE
COMPANY'S REASONABLE EXPENSES IN FURNISHING SUCH EXHIBIT. WRITTEN REQUESTS MAY
BE DIRECTED TO THE COMPANY, 200 HOLLEDER PARKWAY, ROCHESTER, NEW YORK 14615,
ATTENTION: SECRETARY.

By Order of the Board of Directors

/s/ Robert W. August
--------------------
Robert W. August
Secretary

Rochester, New York
July 6, 2001

16
18

EXHIBIT A

MONRO MUFFLER BRAKE, INC.
AUDIT COMMITTEE CHARTER

THE AUDIT COMMITTEE ("THE COMMITTEE"), OF THE BOARD OF DIRECTORS ("THE BOARD")
OF MONRO MUFFLER BRAKE, INC. ("THE COMPANY"), WILL HAVE THE OVERSIGHT
RESPONSIBILITY, AUTHORITY AND SPECIFIC DUTIES AS DESCRIBED BELOW.

PURPOSE

The Audit Committee is appointed by the Board of Directors to assist the Board
in fulfilling its oversight responsibilities. The Audit Committee's primary
duties and responsibilities are to:

- Monitor the integrity of the Company's financial reporting process and
systems of internal controls regarding finance, accounting and legal
compliance.

- Monitor the independence and performance of the Company's independent
auditors.

- Provide an avenue of communication among the independent auditors,
management and the Board.

The Audit Committee has the authority to conduct any investigation appropriate
to its responsibilities, and may request the independent auditors, as well as
any officer or employee of the Company, or the Company's outside counsel, to
attend a meeting of the Committee or to meet with any members of, or consultant
to, the Committee. The Audit Committee has the authority to retain, at the
Company's expense, special legal, accounting, or other consultants or experts to
assist in the performance of its duties.

The Audit Committee will primarily fulfill these responsibilities by carrying
out the activities enumerated in the "Responsibilities" section of this Charter.

It is not the responsibility of the Committee to determine that the Company's
financial statements are complete and accurate and are in accordance with
generally accepted accounting principles or to plan or conduct audits. This is
the responsibility of management or the independent auditors.

ORGANIZATION

The Committee will be comprised of three or more directors as determined by the
Board. The members of the Committee will be elected annually at the
organizational meeting of the full Board held in August and will be listed in
the annual report to shareholders. One of the members of the Committee will be
elected Committee Chair by the Board.

Each member of the Audit Committee shall be financially literate, as such
qualification is interpreted by the Board of Directors in its business judgment,
or must become financially literate within a reasonable period of time after his
or her appointment to the Audit Committee.

At least one member of the Audit Committee must have accounting or related
financial management expertise, as the Board of Directors interprets such
qualification in its business judgment.

It is the intention of the Board that its Audit Committee shall satisfy the
independence and experience requirements set forth in the rules of the NASDAQ
National Market System applicable to audit committees.

STATEMENT OF POLICY

The Audit Committee shall provide assistance to the Board of Directors in
fulfilling its responsibility to the Company and its shareholders relating to
its oversight of management and its auditors in respect of corporate

17
19

accounting, financial reporting practices, and the quality and integrity of the
financial reports of the Company. It is the role of the Audit Committee to
oversee the work of management and the independent auditors. In so doing, it is
the responsibility of the Audit Committee to maintain open communication between
the directors, the independent auditors and the financial management of the
Company.

The independent auditors for the Company are ultimately accountable to the Board
of Directors and Audit Committee of the Company. The Audit Committee and Board
of Directors have the ultimate authority and responsibility to select, evaluate
and, where appropriate, replace the independent auditors (or to nominate the
independent auditors to be proposed for shareholder approval in any proxy
statement).

RESPONSIBILITIES

In carrying out its responsibilities, the Audit Committee believes its policies
and procedures should remain flexible in order to best react to changing
conditions and to oversee management's implementation of prudent corporate
accounting and reporting policies.

In carrying out these responsibilities, the Audit Committee will:

1. Review and reassess the adequacy of this charter annually. This should be
done in compliance with applicable NASDAQ Audit Committee Requirements.

2. Recommend to the Board the selection, retention or termination of the
Company's independent auditors.

3. The Committee shall be responsible for ensuring that the independent
auditors submit to the Committee, on a periodic basis, a formal written
statement delineating all relationships between the independent auditors
and the Company. The Committee is responsible for discussing with the
independent auditors any disclosed relationships or services that may
impact the objectivity and independence of the independent auditors and for
recommending that the Board take appropriate action in response to the
independent auditors' report to satisfy itself of the independent auditors'
independence.

4. For the purpose of monitoring the independence of the independent auditors,
the Committee shall annually (i) review significant fee and other
significant compensation arrangements by the Company with the independent
auditors; (ii) review fees for significant consulting engagements performed
by the independent auditors' firm; and (iii) be advised of any other
significant study or service undertaken by the independent auditors at the
request of management that is beyond the scope of the audit engagement
letter.

5. Review the scope and general extent of the independent auditors' annual
audit. The Committee's review should include an explanation from the
independent auditors of the factors considered by the accountants in
determining the audit scope, including the major risk factors. The
independent auditors should confirm to the Committee that no limitations
have been placed on the scope or nature of their audit procedures.

6. At the completion of the annual audit, review with management and the
independent auditors the following:

- The annual financial statements and related footnotes and financial
information to be included in the Company's annual report to shareholders
and on Form 10-K.

- Results of the audit of the financial statements and the related report
thereon and, if applicable, a report on changes during the year in
accounting principles and their application.

- Significant changes to the audit plan, if any, and any serious disputes or
difficulties with management encountered during the audit. Inquire about
the cooperation received by the independent auditors during their audit,
including access to all requested records, data and information. Inquire of
the

18
20

independent auditors whether there have been any disagreements with
management which, if not satisfactorily resolved, would have caused them to
issue a nonstandard report on the Company's financial statements.

- Other communications as required to be communicated by the independent
auditors by Statement of Auditing Standards (SAS) 61 as amended by SAS 90
relating to the conduct of the audit. Further, receive a written
communication provided by the independent auditors concerning their
judgment about the quality of the Company's accounting principles, as
outlined in SAS 61 as amended by SAS 90, and that they concur with
management's representation concerning audit adjustments.

If deemed appropriate after such review and discussion, recommend to the
Board that the financial statements be included in the Company's annual
report on Form 10-K.

7. Review with the Company's management and independent auditors significant
accounting and reporting principles, practices and procedures applied by
the Company in preparing its financial statements. Discuss with the
independent auditors their judgements about the quality, not just the
acceptability, of the Company's accounting principles used in financial
reporting.

8. Meet with management and the independent auditors to discuss any relevant
significant recommendations that the independent auditors may have,
particularly those characterized as `material' or `serious'. Additionally,
review Company's accounting and financial reporting controls. Review
annually with the independent auditors their letter as to the adequacy and
effectiveness of such controls. Typically, such recommendations will be
presented by the independent auditors in the form of a Letter of
Recommendations to the Committee. The Committee should review responses of
management to the Letter of Recommendations from the independent auditors
and receive follow-up reports on action taken concerning any material or
serious recommendations.

9. Provide sufficient opportunity for the independent auditors to meet with
the members of the Audit Committee without management present.

10. After preparation by management and review by independent auditors, approve
the report required under SEC rules to be included in the Company's annual
proxy statement. The charter is to be published as an appendix to the proxy
statement every three years.

11. Discuss with the independent auditors the quality of the Company's
financial and accounting personnel, and consider succession planning. Also,
elicit the comments of management regarding the responsiveness of the
independent auditors to the Company's needs.

12. Have a predetermined arrangement with the independent auditors that they
will advise the Committee through its Chair and management of the Company
of any matters identified through procedures followed for interim quarterly
financial statements, and that such notification is to be made prior to the
related press release or, if not practicable, prior to filing Forms 10-Q.

13. Review with management and the independent auditors the methods used to
establish and monitor the Company's policies with respect to unethical or
illegal activities by Company employees that may have a material impact on
the financial statements.

14. Generally as part of the review of the annual financial statements, receive
an oral report(s), at least annually, from the Company's general counsel
concerning legal and regulatory matters that may have a material impact on
the financial statements.

19
21

15. As the Committee may deem appropriate, obtain, weigh and consider expert
advice as to Audit Committee related rules of NASDAQ, Statements on
Auditing Standards and other accounting, legal and regulatory provisions.

16. Perform any other activities consistent with this Charter, the Company's
by-laws and governing law, as the Committee or the Board deems necessary or
appropriate.

ADOPTED JUNE 13, 2000

22
PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!

ANNUAL MEETING OF SHAREHOLDERS
MONRO MUFFLER BRAKE, INC.

AUGUST 6, 2001

Please Detach and Mail in the Envelope Provided

A [X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.

WITHHOLD
FOR authority for
all nominees all nominee(s)
1. To elect five [_] [_]
Class 2 directors
to the Board of
Directors to
serve a two-year term, and until their successors are
duly elected and qualified at the 2003 annual meeting
of shareholders.
(INSTRUCTIONS: To withhold authority to vote for any
individual nominee, write the person's name below.)

NOMINEES: Charles J. August
Frederick M. Danziger
Jack M. Gallagher
Robert G. Gross
Peter J. Solomon

FOR AGAINST ABSTAIN
2. Ratification of the re-appointment [_] [_] [_]
of PricewaterhouseCoopers LLP as
the independent auditors of the
Company for the fiscal year ending
March 31, 2002.

3. Considering such other business as may properly be brought before the
meeting or any adjournment or postponement thereof.

Mark here for [_]
change of address
and note at left.

I will not [_] I will [_]
attend attend
meeting meeting

SIGNATURE ________________ DATE ________ _____________________ DATE___________
SIGNATURE, IF SHARES HELD JOINTLY

INSTRUCTION: Please sign exactly as your name appears hereon. When shares are
held by joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by President or other authorized
officer. If a partnership, please sign in partnership name by authorized person.

--------------------------------------------------------------------------------

MONRO MUFFLER BRAKE, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS, AUGUST 6, 2001

The undersigned hereby appoints Robert G. Gross and Catherine D'Amico, as
proxies, each with the power to appoint his substitute and hereby authorizes
such person acting individually, to represent and to vote, as specified on the
reverse side hereof, all of the shares of common stock of Monro Muffler Brake,
Inc. which the undersigned may be entitled to vote at the Annual Meeting of
Shareholders to be held at The Hutchison House, 930 East Avenue, Rochester, New
York, 14607, commencing at 10:00 a.m. on August 6, 2001 and at any postponement
or adjournment thereof; and in the discretion of the proxies, their substitutes
or delegates, to vote such shares and to represent the undersigned in respect of
other matters properly brought before the meeting.

WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED AS SPECIFIED BY THE SIGNING
SHAREHOLDER ON THE REVERSE SIDE HEREOF. UNLESS THE AUTHORITY TO VOTE FOR
ELECTION OF ANY NOMINEE FOR DIRECTOR IS WITHHELD IN ACCORDANCE WITH THE
INSTRUCTIONS ON THE REVERSE SIDE HEREOF, THIS PROXY WILL BE VOTED IN ACCORDANCE
WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS.

(TO BE SIGNED ON REVERSE SIDE.)

--------------------------------------------------------------------------------