UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended January 3, 2002
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[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 1-11556
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UNI-MARTS, INC.
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(Exact name of registrant as specified in its charter)
Delaware 25-1311379
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
477 East Beaver Avenue, State College, PA 16801-5690
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(Address of principal executive offices) (Zip Code)
(8l4) 234-6000
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(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last
report.)
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
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7,086,953 Common Shares were outstanding at February 8, 2002.
This Document Contains 19 Pages.
-1-
UNI-MARTS, INC. AND SUBSIDIARIES
INDEX
PART I. FINANCIAL INFORMATION
------------------------------
PAGE(S)
Item 1. Financial Statements
Condensed Consolidated Balance Sheets -
January 3, 2002 and September 30, 2001 3-4
Condensed Consolidated Statements of Operations -
Quarters Ended January 3, 2002 and January 4, 2001 5
Condensed Consolidated Statements of Cash Flows -
Quarters Ended January 3, 2002 and January 4, 2001 6-7
Notes to Condensed Consolidated Financial Statements 8-12
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 13-15
Item 3. Quantitative and Qualitative Disclosures About Market
Risk 16
PART II. OTHER INFORMATION
---------------------------
Item 6. Exhibits and Reports on Form 8-K 16-17
Exhibit Index 19
-2-
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
UNI-MARTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
January 3, September 30,
2002 2001
---------- -------------
ASSETS
CURRENT ASSETS:
Cash $ 3,976 $ 5,075
Accounts receivable - less allowances of
$211 and $225 6,011 7,156
Inventories 18,162 18,471
Prepaid and current deferred taxes 1,637 1,672
Property held for sale 1,786 3,137
Prepaid expenses and other 1,164 1,448
Loan due from officer - current portion 0 0
-------- --------
TOTAL CURRENT ASSETS 32,736 36,959
PROPERTY, EQUIPMENT AND IMPROVEMENTS -
at cost, less accumulated depreciation and
amortization of $60,767 and $59,166 102,949 103,488
LOAN DUE FROM OFFICER 360 420
NET INTANGIBLE AND OTHER ASSETS 7,681 7,763
-------- --------
TOTAL ASSETS $143,726 $148,630
======== ========
-3-
UNI-MARTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
(CONTINUED)
(Unaudited)
January 3, September 30,
2002 2001
---------- -------------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 11,696 $ 16,239
Gas taxes payable 3,614 3,360
Accrued expenses 5,844 6,820
Current maturities of long-term debt 2,940 2,920
Current obligations under capital leases 350 391
-------- --------
TOTAL CURRENT LIABILITIES 24,444 29,730
LONG-TERM DEBT, less current maturities 81,328 80,912
OBLIGATIONS UNDER CAPITAL LEASES,
less current maturities 303 361
DEFERRED TAXES 2,974 2,917
DEFERRED INCOME AND OTHER LIABILITIES 5,035 5,217
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common Stock, par value $.10 per share:
Authorized 15,000,000 shares
Issued 7,392,184 and 7,388,083
shares, respectively 739 739
Additional paid-in capital 23,807 23,833
Retained earnings 7,088 6,978
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31,634 31,550
Less treasury stock, at cost - 310,897
and 323,275 shares of Common Stock,
respectively (1,992) (2,057)
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29,642 29,493
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $143,726 $148,630
======== ========
See notes to consolidated financial statements
-4-
UNI-MARTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
QUARTER ENDED
January 3, January 4,
2002 2001
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REVENUES:
Merchandise sales $56,254 $ 50,482
Gasoline sales 42,295 58,459
Other income 440 677
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98,989 109,618
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COSTS AND EXPENSES:
Cost of sales 76,093 86,351
Selling 16,955 16,695
General and administrative 1,902 1,871
Depreciation and amortization 2,058 1,977
Interest 1,815 1,936
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98,823 108,830
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EARNINGS BEFORE INCOME TAXES 166 788
INCOME TAX PROVISION 56 268
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NET EARNINGS $ 110 $ 520
======= ========
NET EARNINGS PER SHARE $ 0.02 $ 0.07
======= ========
DILUTED EARNINGS PER SHARE $ 0.02 $ 0.07
======= ========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 7,070 7,036
======= ========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING
ASSUMING DILUTION 7,189 7,068
======= ========
See notes to consolidated financial statements
-5-
UNI-MARTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
QUARTER ENDED
January 3, January 4,
2002 2001
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CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers and others $ 101,383 $ 110,795
Cash paid to suppliers and employees (99,108) (110,678)
Dividends and interest received 13 23
Interest paid (net of capitalized interest
of $0 and $287) (2,296) (2,382)
Income taxes received 36 15
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NET CASH PROVIDED BY (USED IN) OPERATING
ACTIVITIES 28 (2,227)
CASH FLOWS FROM INVESTING ACTIVITIES:
Receipts from sale of capital assets 4 242
Purchase of property, equipment and
improvements (1,421) (4,261)
Note receivable from officer 60 0
Cash advanced for intangible and other
assets (75) (60)
Cash received for intangible and other
assets 16 9
--------- ---------
NET CASH USED IN INVESTING ACTIVITIES (1,416) (4,070)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings (payments) on revolving credit
agreement 1,512 583
Additional long-term borrowings 0 3,624
Principal payments on debt (1,231) (786)
Proceeds from issuance of common stock 8 7
--------- ---------
NET CASH PROVIDED BY FINANCING ACTIVITIES 289 3,428
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NET DECREASE IN CASH (1,099) (2,869)
CASH:
Beginning of period 5,075 7,882
--------- ---------
End of period $ 3,976 $ 5,013
========= =========
-6-
UNI-MARTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(CONTINUED)
(Unaudited)
QUARTER ENDED
January 3, January 4,
2002 2001
---------- ----------
RECONCILIATION OF NET EARNINGS TO NET CASH
PROVIDED BY (USED IN) OPERATING ACTIVITIES:
NET EARNINGS $ 110 $ 520
ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES:
Depreciation and amortization 2,058 1,977
Loss on sale of capital assets and other 126 31
Changes in assets and liabilities:
(Increase) decrease in:
Accounts receivable 1,144 1,405
Inventories 308 (290)
Prepaid expenses and other 1,636 194
Increase (decrease) in:
Accounts payable and accrued expenses (5,265) (6,206)
Deferred income taxes and other
liabilities (89) 142
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TOTAL ADJUSTMENTS TO NET EARNINGS (82) (2,747)
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NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES $ 28 ($2,227)
======= =======
See notes to consolidated financial statements
-7-
UNI-MARTS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
A. FINANCIAL STATEMENTS:
The consolidated balance sheet as of January 3, 2002, the consolidated
statements of operations and the consolidated statements of cash flows for
the quarters ended January 3, 2002 and January 4, 2001 have been prepared
by Uni-Marts, Inc. (the "Company") without audit. In the opinion of
management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position of the
Company at January 3, 2002 and the results of operations and cash flows
for all periods presented have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with accounting principles
generally accepted in the United States of America have been condensed or
omitted. It is suggested that these consolidated financial statements be
read in conjunction with the financial statements and notes thereto
included in the Company's Annual Report on Form 10-K for the fiscal year
ended September 30, 2001. Certain reclassifications have been made to the
September 30, 2001 financial statements to conform to classifications used
in fiscal year 2002. The results of operations for the interim periods are
not necessarily indicative of the results to be obtained for the full
year.
B. INTANGIBLE AND OTHER ASSETS:
Intangible and other assets consist of the following (in thousands):
January 3, January 4,
2002 2001
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Goodwill $8,874 $8,874
Lease acquisition costs 315 439
Noncompete agreements 250 250
Other intangible assets 181 165
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9,620 9,728
Less accumulated amortization 3,053 2,717
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6,567 7,011
Other assets 1,114 1,077
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$7,681 $8,088
====== ======
Goodwill represents the excess of costs over the fair value of net assets
acquired in business combinations and is amortized on a straight-line
basis over periods of 13 to 40 years. Lease acquisition costs are the
bargain element of acquired leases and are being amortized on a
straight-line basis over the related lease terms. It is the Company's
policy to periodically review and evaluate the recoverability of the
intangible assets by assessing current and future profitability and cash
flows and to determine whether the amortization of the balances over their
remaining lives can be recovered through expected future results and cash
flows.
-8-
C. REVOLVING CREDIT AGREEMENT:
On April 20, 2000, the Company executed a 3-year secured $10.0 million
revolving loan agreement (the "Agreement") with $3.5 million available for
letters of credit. During the second quarter of fiscal year 2001, the
Company amended the Agreement to increase the total credit line to $13.0
million, with $3.5 million available for letters of credit, and amend
certain financial covenants. Provisions of the Agreement require the
maintenance of certain covenants relating to minimum tangible net worth,
interest and fixed charge coverage ratios, as measured on a quarterly
basis. In addition, the Agreement places limitations on capital
expenditures, additional debt and payment of dividends. The Company was in
compliance with these covenants as of January 3, 2002. Borrowings of $7.3
million and letters of credit of $3.0 million were outstanding at January
3, 2002. This facility bears interest at the Company's option based on a
rate of either prime plus 1% or LIBOR plus 3.0%. The blended interest rate
at January 3, 2002 was 5.40%. The Agreement is collateralized by
substantially all of the Company's eligible inventories and eligible
receivables and selected properties. The net book value of these selected
properties at January 3, 2002 was $2,582,500. During the first quarter of
fiscal year 2002, the Company amended this Agreement to extend the
maturity date to April 20, 2004, amend certain covenant provisions, and to
provide an additional $2.0 million for borrowing on a seasonal basis.
-9-
D. LONG-TERM DEBT:
January 3, September 30,
2002 2001
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(In thousands)
Mortgage Loan. Principal and interest will
be paid in 200 remaining monthly installments.
At January 3, 2002, the coupon rate was 9.08%
and the effective interest rate was 9.78%,
net of unamortized fees of $1,298,348
($1,329,757 in 2001). $32,075 $32,331
Mortgage Loan. Principal and interest will
be paid in 221 remaining monthly installments.
The loan bears interest at LIBOR plus 3.75%.
At January 3, 2002, the coupon rate was 5.67%
and the effective interest rate was 6.03%, net
of unamortized fees of $394,072 ($403,779
in 2001). 20,912 21,249
Mortgage Loan. Principal and interest will
be paid in 221 remaining monthly installments.
At January 3, 2002, the coupon rate was 10.39%
and the effective interest rate was 10.70%,
net of unamortized fees of $122,346
($124,901 in 2001). 6,590 6,628
Mortgage Loans. Principal and interest
are paid in monthly installments. The loans
expire in 2009, 2010, 2020 and 2021. Interest
ranges from the prime rate to LIBOR plus
3.75%. At January 3, 2002, the blended coupon
rate was 6.59% and the effective interest rate
was 6.94%, net of unamortized fees of $149,923
($151,688 in 2001). 7,389 7,496
Revolving Credit Agreement. Interest is paid
monthly. The blended interest rate at
January 3, 2002 was 5.40%. (See Note C) 7,271 5,758
Equipment Loans. Principal and interest are
paid in monthly installments. The loans
expire in 2010 and 2011 and bear interest
at LIBOR plus 3.75%. At January 3, 2002,
the blended coupon rate was 5.67% and the
effective interest rate was 6.21%, net of
unamortized fees of $165,050 ($174,996
in 2001). 9,060 9,375
Equipment Loan. Principal and interest will
be paid in 102 remaining monthly installments.
The loan expires in 2010. At January 3, 2002,
the coupon rate was 10.73% and the effective
interest rate was 11.20%, net of unamortized
fees of $16,287 ($17,124 in 2001). 971 995
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84,268 83,832
Less current maturities 2,940 2,920
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$81,328 $80,912
======= =======
-10-
D. LONG-TERM DEBT (CONTINUED):
The mortgage loans are collateralized by $70,191,500 of property, at net
book value, and the equipment loans are collateralized by $5,528,200 of
equipment, at net book value.
Aggregate maturities of long-term debt (net of loan fee amortization)
during the next five years are as follows (in thousands):
September 30,
2002 $ 1,844
2003 2,691
2004 10,208
2005 3,205
2006 3,495
Thereafter 62,825
-------
$84,268
=======
E. RELATED PARTY TRANSACTIONS:
Certain directors and officers of the Company are also directors, officers
and controlling shareholders of Unico Corporation ("Unico"), formerly the
Company's parent, and other affiliated companies from which the Company
leases its corporate headquarters and various store and other locations
under agreements classified as operating leases. During the first quarter
of fiscal year 2002, the Company completed lease agreements for two stores
and certain equipment with Unico and an affiliate. These leases provide
for annual rents aggregating $548,200. Aggregate rentals in connection
with all such leases for the quarters ended January 3, 2002 and January 4,
2001 were $224,400 and $166,700, respectively.
F. NEW ACCOUNTING PRONOUNCEMENTS:
In June 2001, the Financial Accounting Standards Board issued SFAS No.
142 and in August 2001, issued SFAS No. 144. SFAS No. 142, "Goodwill and
Other Intangible Assets," requires that such assets with indefinite lives
not be amortized but be tested annually for impairment and provides
specific guidance for such testing. This statement also requires
disclosure of information regarding goodwill and other assets that was
previously not required. SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets," provides additional guidance for
impairment testing and determination of when an asset is considered to be
for sale. The Company is not required to adopt these accounting standards
until fiscal year 2003. At this time, the Company has not determined the
impact these standards will have on the Company's financial statements.
-11-
G. CONTINGENCIES:
(1) Leases -- The Company leases its corporate headquarters, 131 of
its store locations and certain equipment. Future minimum lease
payments under capital leases and noncancellable operating leases
are shown below. Some of the leases provide for additional rentals
when sales exceed a specified amount and contain variable renewal
options and escalation clauses.
Capital Operating Rental
Leases Leases Income
------- --------- ------
(In thousands)
Nine months ending
September 30, 2002 $342 $ 4,349 $ 625
Fiscal year 2003 180 5,263 640
Fiscal year 2004 140 3,944 491
Fiscal year 2005 31 2,822 385
Fiscal year 2006 31 1,630 198
Thereafter 52 5,289 401
---- ------- ------
Total future minimum
lease payments 776 $23,297 $2,740
======= ======
Less amount representing
interest 123
----
Present value of future
payments 653
Less current maturities 350
----
$303
====
(2) Litigation -- The Company is involved in litigation and other
legal matters which have arisen in the normal course of business.
Although the ultimate results of these matters are not currently
determinable, management does not expect that they will have a
material adverse effect on the Company's consolidated financial
position, results of operations or cash flows.
-12-
ITEM 2.
UNI-MARTS, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Set forth below are selected unaudited consolidated financial data of the
Company for the periods indicated:
QUARTER ENDED
January 3, January 4,
2002 2001
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Revenues:
Merchandise sales 56.8% 46.1%
Gasoline sales 42.7 53.3
Other income 0.5 0.6
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Total revenues 100.0 100.0
Cost of sales 76.9 78.8
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Gross profit:
Merchandise (as a percentage of
merchandise sales) 31.6 33.2
Gasoline (as a percentage of
gasoline sales) 11.1 10.0
Total gross profit 23.1 21.2
Costs and expenses:
Selling 17.1 15.2
General and administrative 1.9 1.7
Depreciation and amortization 2.1 1.8
Interest 1.8 1.8
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Total expenses 22.9 20.5
Earnings before income taxes 0.2 0.7
Income tax provision 0.1 0.2
----- -----
Net earnings 0.1% 0.5%
===== =====
OPERATING DATA (RETAIL LOCATIONS ONLY):
(In thousands, except per gallon data)
Average, per store, for stores open two
full comparable periods:
Merchandise sales $ 188 $ 173
Gasoline sales $ 165 $ 238
Gallons of gasoline sold 174 184
Total gallons of gasoline sold 45,137 45,637
Gross profit per gallon of
gasoline $ 0.104 $ 0.128
STORE INFORMATION:
Company-operated stores 294 292
Franchisee-operated stores 7 7
Locations with self-service gasoline 238 238
-13-
RESULTS OF OPERATIONS:
Matters discussed below should be read in conjunction with "Operating Data
(Retail Locations Only)" on the preceding page. Certain statements contained in
this report are forward looking, such as statements regarding the Company's
plans and strategies or future financial performance. Although the Company
believes that its expectations are based on reasonable assumptions within the
bounds of its knowledge, investors and prospective investors are cautioned that
such statements are only projections and that actual events or results may
differ materially from those expressed in any such forward-looking statements.
In addition to the factors discussed elsewhere in this report, the Company's
actual consolidated quarterly or annual operating results have been affected in
the past, or could be affected in the future, by additional factors, including,
without limitation, general economic, business and market conditions;
environmental, tax and tobacco legislation or regulation; volatility of gasoline
prices, margins and supplies; changes in corporate strategy; merchandising
margins; customer traffic; weather conditions; labor costs and the level of
capital expenditures.
In the last twelve months, the Company continued its store evaluation and
strategic initiative program by converting convenience stores to Choice
Cigarette Discount Outlets ("Choice") or closing locations. During that period,
21 convenience stores were converted to Choice stores and three convenience
stores were closed. The Company also expanded its store base during this period
by constructing or acquiring three convenience stores and two Choice locations.
The Company intends to aggressively pursue the conversion of convenience stores
to Choice outlets to achieve additional improvement to store profitability.
QUARTERS ENDED JANUARY 3, 2002 AND JANUARY 4, 2001
--------------------------------------------------
Total revenues in the first quarter of fiscal year 2002 were $99.0 million
compared to total revenues of $109.6 million in the same quarter of fiscal year
2001, a decline of $10.6 million, or 9.7%. This decline is the net result of a
$5.8 million increase in merchandise sales, a $16.2 million decline in gasoline
sales and a $200,000 decline in other income. Merchandise sales were $56.3
million in the quarter ended January 3, 2002, an increase of $5.8 million, or
11.4%, over merchandise sales of $50.5 million in the quarter ended January 4,
2001. This increase is largely attributable to higher sales levels per store.
Merchandise sales at comparable stores increased 8.5%. Gasoline sales were $42.3
million in the quarter ended January 3, 2002, compared to gasoline sales of
$58.5 million in the quarter ended January 4, 2001, a decline of $16.2 million,
or 27.6%. The national decline in consumer demand during the period resulted in
declines in gasoline sales dollars, gallons sold and profit per gallon sold. A
34.4 cent per gallon decline in the average selling price of gasoline in
comparison to the same quarter in the last fiscal year was the leading factor in
the Company's decline in gasoline sales. Gasoline gallons sold at comparable
stores declined 5.3%.
Gross profits on merchandise sales increased by $1.0 million, or 6.1%, from
$16.8 million in the first quarter of fiscal year 2001 to $17.8 million in the
first quarter of fiscal year 2001. This increase is attributable to increased
merchandise sales offset, to some degree, by lower gross profit rates. Gross
profits on gasoline sales declined by $1.2 million, or 19.8%, due primarily to
lower gross profits per gallon sold. The Company remained price competitive in
the retail gasoline market throughout the quarter, resulting in lower gross
profits per gallon sold.
Selling expenses in the quarter ended January 3, 2002 increased by $260,000, or
1.6%, due primarily to a slight increase in the number of stores in operation.
General and administrative expense increased by $31,000, or 1.7%, due primarily
to increased salaries that went into effect at the beginning of the fiscal year.
Depreciation and amortization expense increased by $81,000, or 4.1%, due
-14-
largely to the depreciation of equipment at new stores and newly converted
Choice stores. Interest expense declined by $121,000, or 6.3%, due to lower
interest rates.
Earnings before income taxes in the first quarter of fiscal year 2002 were
$166,000 compared to pre-tax earnings of $788,000 in the same period of the
previous year. The decline of $622,000 is largely attributable to the decline in
gasoline gross profits and higher expenses, offset, in part, by increased
merchandise gross profits. The provision for income taxes remained fairly level
as a percentage of earnings before income taxes. Net earnings in the first
quarter of the current fiscal year were $110,000, or $0.02 per share, compared
to net earnings of $520,000, or $0.07 per share, in the quarter ended January 4,
2001.
LIQUIDITY AND CAPITAL RESOURCES:
Most of the Company's sales are for cash and its inventory turns over rapidly.
As a result, the Company's daily operations do not generally require large
amounts of working capital. From time to time, the Company utilizes substantial
portions of its cash to acquire and construct new stores and renovate existing
locations.
During the first quarter of fiscal year 2002, the Company amended its revolving
credit agreement to extend the maturity date to April 2004, amend certain
covenant provisions, and to provide an additional $2.0 million available for
borrowing on a seasonal basis. At January 3, 2002, $4.7 million were available
for borrowing under this agreement.
Capital requirements for debt service and capital leases for the remainder of
fiscal year 2002 are approximately $2.2 million. Anticipated capital
expenditures in the balance of the fiscal year are approximately $1.1 million
for the replacement of store equipment and upgrading the Company's data
processing systems.
Operating lease commitments for the balance of fiscal year 2002 are
approximately $4.3 million. These commitments for fiscal years 2003, 2004, 2005,
and 2006 are approximately $5.3 million, $3.9 million, $2.8 million, and $1.6
million, respectively.
Management believes that cash from operations and the available credit
facilities will be sufficient to meet the Company's obligations for the
foreseeable future.
In June 2001, the Financial Accounting Standards Board issued SFAS No. 142 and
in August 2001, issued SFAS No. 144. SFAS NO. 142, "Goodwill and Other
Intangible Assets," requires that such assets with indefinite lives not be
amortized but be tested annually for impairment and provides specific guidance
for such testing. This statement also requires disclosure of information
regarding goodwill and other assets that was previously not required. SFAS No.
144, "Accounting for the Impairment or Disposal of Long-Lived Assets," provides
additional guidance for impairment testing and determination of when an asset is
considered to be for sale. The Company is not required to adopt these accounting
standards until fiscal year 2003. At this time, the Company has not determined
the impact these standards will have on the Company's financial statements.
-15-
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The Company uses its revolving credit facility and its mortgage and equipment
loans to finance a significant portion of its operations. These on-balance sheet
financial instruments, to the extent they provide for variable rates of
interest, expose the Company to interest rate risk resulting from changes in the
LIBOR or prime rate.
To the extent that the Company's financial instruments expose the Company to
interest rate risk, they are presented in the table below. The table presents
principal cash flows and related interest rates by year of maturity for the
Company's revolving credit facility, mortgage loans and equipment loans at
January 3, 2002.
The carrying amounts of cash and short-term debt approximate fair value. The
Company estimates the fair value of its long-term, fixed-rate debt generally
using discounted cash flow analysis based on the Company's current borrowing
rates for debt with similar maturities. The Company estimates the fair value of
its long-term, variable-rate debt based on carrying amounts plus unamortized
loan fees associated with the debt.
Fiscal Year of Maturity
(dollar amounts in thousands)
Total Fair
Due At Value at
2002 2003 2004 2005 2006 Thereafter Maturity 1/3/02
------ ------ ------ ------ ------ ---------- -------- --------
Interest-rate sensitive assets:
------------------------------
Noninterest-bearing
checking accounts $1,680 $ 0 $ 0 $ 0 $ 0 $ 0 $ 1,680 $ 1,680
Interest-bearing
checking accounts $2,296 $ 0 $ 0 $ 0 $ 0 $ 0 $ 2,296 $ 2,296
Average interest rate 1.55% 1.55%
-----------------------------------------------------------------------------
$3,976 $ 3,976 $ 3,976
0.90% 0.90% --
Interest-rate sensitive liabilities:
-----------------------------------
Variable-rate borrowings $1,031 $8,842 $1,692 $1,823 $1,963 $27,600 $42,951 $42,951
Average interest rate 5.60% 5.60% 5.64% 5.64% 5.64% 5.65% 5.65% --
Fixed-rate borrowings $ 814 $1,120 $1,245 $1,382 $1,532 $35,225 $41,318 $44,654
Average interest rate 9.34% 9.34% 9.34% 9.34% 9.34% 9.34% 9.34% --
-----------------------------------------------------------------------------
$1,845 $9,962 $2,937 $3,205 $3,495 $62,825 $84,269 $87,605
7.43% 7.44% 7.65% 7.67% 7.69% 7.72% 7.72% --
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
3.1 Amended and Restated Certificate of Incorporation of the
Company (Filed as Exhibit 3.1 to the Company's Quarterly
Report on Form 10-Q for the period ended March 30, 1995
and incorporated herein by reference thereto).
3.2 Amended and Restated By-Laws of the Company (Filed as
Exhibit 3.2 to the Annual Report of Uni-Marts, Inc. on
Form 10-K/A for the year ended September 30, 2001, filed
on February 6, 2002, and incorporated herein by
reference thereto).
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4.1 Form of the Company's Common Stock Certificate (Filed as
Exhibit 4.3 to the Company's Quarterly Report on Form
10-Q for the period ended April 1, 1993, File No.
1-11556, and incorporated herein by reference thereto).
4.2 Rights Agreement (Filed as Exhibit 4(ii) to the
Company's Registration Statement on Form 8-A/A, filed
February 14, 2002, File No. 1-11556, and incorporated
herein by reference thereto).
10.1 Amendments 2001-1, 2001-2 and 2001-3 to the Uni-Marts,
Inc. Equity Compensation Plan dated December 7, 2001.
10.2 Third Amendment to the revolving credit Loan Agreement
between Provident Bank and Uni-Marts, Inc. dated
December 21, 2001.
11 Statement regarding computation of per share earnings.
(b) REPORTS ON FORM 8-K
The Company did not file any reports on Form 8-K during the quarter
ended January 3, 2002.
The Company filed a report on Form 8-K on February 6, 2002, and an
amendment thereto on February 14, 2002, reporting the adoption by the
Company of a shareholder rights plan.
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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.
Uni-Marts, Inc.
-----------------------------------
(Registrant)
Date February 15, 2002 /S/ HENRY D. SAHAKIAN
----------------- -----------------------------------
Henry D. Sahakian
Chairman of the Board
(Principal Executive Officer)
Date February 15, 2002 /S/ N. GREGORY PETRICK
----------------- -----------------------------------
N. Gregory Petrick
Executive Vice President and
Chief Financial Officer
(Principal Accounting Officer)
(Principal Financial Officer)
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UNI-MARTS, INC. AND SUBSIDIARIES
EXHIBIT INDEX
Number Description
10.1 Amendments 2001-1, 2001-2 and 2001-3 to the Uni-Marts,
Inc. 1996 Equity Compensation Plan dated December 7, 2001.
10.2 Third Amendment to the revolving credit Loan Agreement
between Provident Bank and Uni-Marts, Inc. dated December
21, 2001.
11 Statement regarding computation of per share earnings.
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