MONRO MUFFLER BRAKE, INC.
PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
Additionally, the Company may contribute to the Plan an additional amount, either in the form of a
Profit Sharing Contribution, or in the form of an additional match on 401(k) participant contributions, based on the sole discretion of the Board of Directors. For the years ended March 31, 2018 and 2017, the Company did not make a
Profit Sharing Contribution.
Effective July 1, 2018, the Company discontinued the discretionary Profit Sharing contribution
and presently does not intend to fund future contributions to these components of the Plan. See Note 7.
Participants Accounts
Each participants account is credited with the participants contribution and (a) the Companys matching
contribution, (b) an allocation of the Companys Profit Sharing contribution, (c) Plan earnings and (d) charged with an allocation of administrative expenses. Plan earnings and administrative expense allocations are based on
account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participants vested account.
Vesting
Participants are immediately vested in their own salary reduction contributions
plus actual earnings thereon. Vesting in the Company 401(k) Matching Contribution portion of their accounts, plus actual earnings thereon, is based on years of service as defined in the Plan. A participant vests 25% at the end of his/her second year
of service, and an additional 25% each year thereafter.
Participants become 100% vested in the Companys Profit Sharing Contributions at
the end of five years of service with 25%, 50% and 75% vesting in years two, three and four, respectively.
Forfeited balances of terminated
participants nonvested accounts are used to reduce future Company contributions and to pay administrative expenses of the Plan. Forfeited accounts used to reduce Company contributions and to pay administrative expenses amounted to
approximately $83,000 and $31,000 for the years ended March 31, 2018 and 2017, respectively. At March 31, 2018 and 2017, remaining forfeitures available to offset future contributions were approximately $81,000 and $105,000, respectively.
Notes Receivable from Participants
Participants may borrow from their 401(k) account in various amounts as specified by the Plan. Notes receivable must be a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of their
vested account balances. The terms for notes receivable range from one to five years, or up to ten years for the purchase of a primary residence. The notes receivable are secured by the balance in the participants account and bear interest at
a rate commensurate with local prevailing rates as determined by the Benefits Committee. Principal and interest are paid ratably through payroll deductions. Notes receivable of approximately $854,000 and $784,000 were granted during the years ended
March 31, 2018 and 2017, respectively. Interest income is recorded on the accrual basis. Related fees are recorded as administrative expenses and are charged directly to the participants accounts when they are incurred. No allowance for
credit losses has been recorded as of March 31, 2018 or 2017. Delinquent notes receivable are reclassified as distributions based upon the terms of the plan document.
Payment of Benefits
A participant may commence payment of benefits
upon termination of employment, attainment of age 59
1
/
2
, or becoming disabled. A participant may elect to receive benefits in the form of a
lump-sum
distribution or installment payments over time.
7