UNITED STATES
SECURITIES & 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 MARCH 28, 2004
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to __________
Commission file number: 0-28234
MEXICAN RESTAURANTS, INC.
(Exact name of registrant as specified in its charter)
TEXAS 76-0493269
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
1135 EDGEBROOK, HOUSTON, TEXAS 77034-1899
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 713-943-7574
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 [ ]
Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes [ ] No [X]
Number of shares outstanding of each of the issuer's classes of common stock, as
of May 3, 2004: 3,384,605 SHARES OF COMMON STOCK, PAR VALUE $.01.
PART 1 - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
MEXICAN RESTAURANTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED) (AUDITED)
3/28/2004 12/28/2003
------------ ------------
ASSETS
Current assets:
Cash and cash equivalents $ 842,161 $ 366,042
Royalties receivable 167,297 179,517
Other receivables 697,864 423,670
Inventory 621,267 555,064
Taxes receivable 140,499 345,006
Prepaid expenses and other current assets 842,624 717,899
------------ ------------
Total current assets 3,311,712 2,587,198
------------ ------------
Property, plant and equipment 27,769,572 24,484,571
Less accumulated depreciation (12,057,957) (11,502,668)
------------ ------------
Net property, plant and equipment 15,711,615 12,981,903
Goodwill, net 10,462,998 7,196,265
Deferred tax assets 1,237,774 1,272,173
Property held for resale 884,118 884,118
Other assets 826,648 939,579
------------ ------------
$ 32,434,865 $ 25,861,236
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current installments of long-term debt $ 1,000,000 $ 1,000,000
Accounts payable 1,728,979 1,516,217
Accrued sales and liquor taxes 670,963 469,817
Accrued payroll and taxes 1,562,199 976,146
Accrued expenses 847,185 1,294,486
------------ ------------
Total current liabilities 5,809,326 5,256,666
------------ ------------
Long-term debt, net of current portion 7,250,000 1,775,000
Other liabilities 955,001 898,115
Deferred gain 1,925,319 1,977,355
Stockholders' equity:
Preferred stock, $.01 par value, 1,000,000 shares
authorized - -
Capital stock, $0.01 par value, 20,000,000 shares
authorized, 4,732,705 shares issued 47,327 47,327
Additional paid-in capital 20,121,076 20,121,076
Retained earnings 8,073,610 7,542,817
Deferred compensation (37,281) (47,607)
Treasury stock, cost of 1,348,100 common shares (11,709,513) (11,709,513)
------------ ------------
Total stockholders' equity 16,495,219 15,954,100
------------ ------------
$ 32,434,865 $ 25,861,236
============ ============
2
MEXICAN RESTAURANTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
13-WEEK 13-WEEK
PERIOD ENDED PERIOD ENDED
3/28/2004 3/30/03
------------ ------------
Revenues:
Restaurant sales $ 19,296,936 $ 14,399,113
Franchise fees and royalties and other 191,780 295,329
------------ ------------
19,488,716 14,694,442
------------ ------------
Costs and expenses:
Cost of sales 5,394,630 3,902,446
Labor 6,331,108 4,817,870
Restaurant operating expenses 4,601,544 3,579,560
General and administrative 1,502,283 1,383,708
Depreciation and amortization 639,334 580,526
Pre-opening costs - 1,728
Restaurant closure costs 117,398 -
------------ ------------
18,586,297 14,265,838
------------ ------------
Operating income 902,419 428,604
------------ ------------
Other income (expense):
Interest income 7,371 6,883
Interest expense (139,265) (70,482)
Other, net 5,999 334,527
------------ ------------
(125,895) 270,928
------------ ------------
Income before income tax expense 776,524 699,532
Income tax expense (benefit) 245,731 230,422
------------ ------------
Net income $ 530,793 $ 469,110
============ ============
Basic income per share $ 0.16 $ 0.14
============ ============
Diluted income per share $ 0.15 $ 0.14
============ ============
Weighted average number of shares (basic) 3,384,605 3,384,605
============ ============
Weighted average number of shares (diluted) 3,516,467 3,430,344
============ ============
3
MEXICAN RESTAURANTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
13-WEEK PERIODS ENDED
3/28/2004 3/30/2003
----------- -----------
Cash flows from operating activities:
Net income $ 530,793 $ 469,110
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 639,334 580,526
Deferred gain amortization (52,036) (52,036)
Asset impairments and restaurant closure costs 117,398 -
Loss (gain) on sale of property, plant & equipment 17,072 (316,843)
Deferred compensation 10,326 10,326
Deferred taxes 34,399 83,385
Changes in assets and liabilities:
Royalties receivable 12,220 5,110
Other receivables (274,194) 91,687
Income tax receivable/payable 204,507 165,737
Inventory 83,248 41,055
Prepaid and other current assets (124,725) 63,674
Other assets 671,789 (12,597)
Accounts payable 171,906 (169,993)
Accrued expenses and other liabilities 254,356 (736,009)
Other liabilities 56,886 4,156
----------- -----------
Total adjustments 1,822,486 (241,822)
----------- -----------
Net cash provided by operating activities 2,353,279 227,288
----------- -----------
Cash flows from investing activities:
Insurance proceeds from fire loss on building - 316,591
Purchase of property, plant and equipment (348,912) (349,776)
Business Acquisition (7,003,248) -
----------- -----------
Net cash used in investing activities (7,352,160) (33,185)
----------- -----------
Cash flows from financing activities:
Net borrowings (payments) under line of credit 2,475,000 (350,000)
Additions to Long term Notes Payable 3,000,000 -
----------- -----------
Net cash used in financing activities 5,475,000 (350,000)
----------- -----------
Decrease in cash and cash equivalents 476,119 (155,897)
----------- -----------
Cash and cash equivalents at beginning of period 366,042 526,536
----------- -----------
Cash and cash equivalents at end of period $ 842,161 $ 370,639
=========== ===========
Supplemental disclosure of cash flow information:
Cash paid during the period:
Interest $ 74,153 $ 75,021
Income Taxes $ 6,825 $ 6,300
Non-cash investing and financing activity:
CNL real estate transaction $ 8,325,000 $ -
4
MEXICAN RESTAURANTS, INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
In the opinion of Mexican Restaurants, Inc. (the "Company"),
the accompanying consolidated financial statements contain all
adjustments (consisting only of normal recurring accruals and
adjustments) necessary for a fair presentation of the consolidated
financial position as of March 28, 2004, and the consolidated
statements of income for the 13-week period and cash flows for the
13-week period ended March 28, 2004 and March 30, 2003. The
consolidated statements of income for the 13-week period ended March
28, 2004 are not necessarily indicative of the results to be expected
for the full year.
IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS
In June 2001, FASB issued SFAS No. 143, Accounting for Asset
Retirement Obligations. SFAS No. 143 requires the Company to record the
fair value of an asset retirement obligation as a liability in the
period in which it incurs a legal obligation associated with the
retirement of tangible long-lived assets that result from the
acquisition, construction, development, and/or normal use of the
assets. The Company also records a corresponding asset that is
depreciated over the life of the asset. Subsequent to the initial
measurement of the asset retirement obligation, the obligation will be
adjusted at the end of each period to reflect the passage of time and
changes in the estimated future cash flows underlying the obligation.
The Company adopted SFAS No. 143 on January 1, 2003. The adoption of
SFAS No. 143 did not have a material effect on the Company's financial
statements.
In April 2002, the FASB issued SFAS No. 145, Rescission of
FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13,
and Technical Corrections. SFAS No. 145 amends existing guidance on
reporting gains and losses on the extinguishment of debt to prohibit
the classification of the gain or loss as extraordinary, as the use of
such extinguishments have become part of the risk management strategy
of many companies. SFAS No. 145 also amends SFAS No. 13 to require
sale-leaseback accounting for certain lease modifications that have
economic effects similar to sale-leaseback transactions. The adoption
of SFAS No. 145 did not have a material effect on the Company's
financial statements.
In June 2002, the FASB issued SFAS No. 146, Accounting for
Costs Associated with Exit or Disposal Activities. SFAS No. 146
addresses financial accounting and reporting for costs associated with
exit or disposal activities and nullifies Emerging Issues Task Force
(EITF) Issue 94-3, Liability Recognition for Certain Employee
Termination Benefits and Other Costs to Exit an Activity. The adoption
of SFAS No. 146 did not have a material effect on the Company's
financial statements.
In November 2002, the FASB issued Interpretation No. 45,
Guarantor's Accounting and Disclosure Requirements for Guarantees,
Including Indirect Guarantees of Indebtedness to Others, and
interpretation of FASB Statements No. 5, 57 and 107 and a rescission of
FASB Interpretation No. 34. This Interpretation elaborates on the
disclosures to be made by a guarantor in its interim and annual
financial statements about its obligations under guarantees issued. The
Interpretation also clarifies that a guarantor is required to
recognize, at inception of a guarantee, a liability for the fair value
of the obligation undertaken. The initial recognition and measurement
provisions of the Interpretation are applicable to guarantees issued or
modified after December 31, 2002 and did not have a material effect on
the Company's financial statements.
In December 2002, the FASB issued SFAS No. 148, Accounting for
Stock-Based Compensation - Transition and Disclosure, an amendment of
FASB Statement No. 123. This Statement amends FASB Statement No. 123,
Accounting for Stock-Based Compensation, to provide alternative methods
of transition for a voluntary change to the fair value method of
accounting for stock-based employee compensation. In addition, this
Statement amends the disclosure requirements of Statement No. 123 to
require prominent disclosures in both annual and interim financial
statements. Certain of the disclosure modifications are required for
fiscal years ending after December 15, 2002 and are included in the
notes to these consolidated financial statements.
5
2. ACCOUNTING POLICIES
During the interim periods the Company follows the accounting
policies set forth in its consolidated financial statements in its
Annual Report and Form 10-K (file number 0-28234). Reference should be
made to such financial statements for information on such accounting
policies and further financial details.
3 NET INCOME PER COMMON SHARE
Basic income per share is based on the weighted average shares
outstanding without any dilutive effects considered. Diluted income per
share reflects dilution from all contingently issuable shares,
including options and warrants. As of March 28, 2004 and March 30,
2003, the Company had 1,018,470 and 1,044,470 options and warrants
outstanding, respectively. As of March 28, 2004 and March 30, 2003,
such stock options and warrants have the effect of increasing basic
weighted average shares outstanding by 131,862 and 45,739 for the
13-week period, respectively.
4. SFAS NO. 148. "ACCOUNTING FOR STOCK-BASED COMPENSATION"
The Company has adopted the disclosure-only provisions of the
FASB issued SFAS No. 148, Accounting for Stock-Based Compensation -
Transition and Disclosure, an amendment of FASB Statement No. 123,
which amends SFAS No. 123, Accounting for Stock-Based Compensation and
has accounted for stock-based compensation using the intrinsic value
method prescribed in Accounting Principles Board Opinion No. 25,
Accounting for Stock Issued to Employees and related interpretations.
Accordingly, no compensation cost has been recognized for stock options
or warrants. Had compensation cost for the Company's outstanding stock
options and warrants been determined based on the fair value at the
grant date for awards consistent with the provisions of SFAS No. 123,
the Company's net income and net income per share would have been
changed to the pro forma amounts indicated below for the 13-week
periods ended March 28, 2004 and March 30, 2003:
13 WEEKS ENDED
3/28/04 3/30/03
Net income - as reported ................................................ $ 530,793 $ 469,110
Pro forma net income - pro forma for SFAS No. 123 ....................... 530,793 467,169
Net income per share diluted - as reported .............................. 0.15 0.14
Pro forma net income per share diluted - pro forma for SFAS No. 123..... 0.15 0.14
5. ACQUISITION
On January 7, 2004, the Company completed its purchase of 13
restaurants and related assets from its Beaumont-based franchisee for a
total consideration of approximately $13.75 million. The financing for
the acquisition was provided by Fleet National Bank, CNL Franchise
Network, LP ("CNL') and the sellers of Beaumont-based franchise
restaurants. Fleet National Bank provided $2.5 million of the
acquisition financing by amending its credit facility with Mexican
Restaurants, Inc. Six of the acquired restaurants were concurrently
sold to CNL for $8.325 million in a sale-leaseback transaction. The
sellers accepted $3.0 million in notes from Mexican Restaurants, Inc.
for the balance of the purchase price. The seller notes require the
payment of interest only for five years, with $1.5 million in principal
due on January 7, 2009 and $1.5 million in principal amortizing over an
additional five years.
The table below presents pro forma income statement
information as if the Company had purchased the Beaumont-based
restaurants at the beginning of fiscal year 2003. Pro forma adjustments
are to remove royalty income and expense, reflect net interest expense
on the debt resulting from the acquisition and record additional income
tax at an effective rate of 31.6% for the first quarter of fiscal 2004
and 32.9% for the first quarter of fiscal 2003. The first quarter ended
March 30, 2003 included a gain of $316,591 for insurance proceeds
received from fire damage at a restaurant. The pro forma information
does not purport to be indicative of results of operations which would
have occurred had the acquisition been consummated on the date
indicated or future results of operations.
13 WEEKS ENDED
3/28/04 3/30/03
Revenues .................... $19,952,234 $19,526,852
Net income .................. 577,027 507,789
Diluted income per share..... 0.15 0.15
6
The acquisition was accounted for under SFAS 141 and results
of operations are included in the accompanying financial statements
from the date of acquisition. The assets acquired and liabilities
assumed of the acquisition were recorded at estimated fair values using
comparables, appraisals, and records.
A summary of the assets acquired and liabilities assumed in the
acquisition follow:
Estimated fair value of assets acquired:
Current assets 184,601
Property and equipment 2,946,365
Other assets 640,699
Goodwill 3,266,733
---------
Total assets 7,038,398
Less: Cash acquired (35,150)
---------
Net assets acquired 7,003,248
=========
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Form 10-Q contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially different
from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include, among
others, the following: growth strategy; dependence on executive
officers; geographic concentration; increasing susceptibility to
adverse conditions in the region; changes in consumer tastes and eating
habits; national, regional or local economic and real estate
conditions; demographic trends; inclement weather; traffic patterns;
the type, number and location of competing restaurants; inflation;
increased food, labor and benefit costs; the availability of
experienced management and hourly employees; seasonality and the timing
of new restaurant openings; changes in governmental regulations; dram
shop exposure; and other factors not yet experienced by the Company.
The use of words such as "believes", "anticipates", "expects",
"intends" and similar expressions are intended to identify
forward-looking statements, but are not the exclusive means of
identifying such statements. Readers are urged to carefully review and
consider the various disclosures made by the Company in this report and
in the Company's Annual Report and Form 10-K for the fiscal year ended
December 28, 2003, that attempt to advise interested parties of the
risks and factors that may affect the Company's business.
RESULTS OF OPERATIONS
Revenues. The Company's revenues for the first quarter of
fiscal 2004 were up $4.8 million or 32.6% to $19.5 million compared
with the same quarter one year ago. Restaurant sales for the first
quarter of fiscal 2004 were up $4.9 million or 34.0% compared with the
same quarter one year ago, to $19.3 million. The increase reflects the
acquisition of 13 restaurants and related assets from the Company's
Beaumont-based franchisee. The acquisition closed on January 7, 2004.
Franchise fees and royalties decreased $103,376 or 35.5%, reflecting
lost royalty income from the Beaumont-based franchise restaurants.
Total system sales at restaurants operating in both fiscal quarters
("same-stores") increased 2.5%, Company-owned same-store sales for the
quarter increased 2.3% and franchise-owned same-store sales for the
quarter increased 3.1% from the same quarter in fiscal 2003.
Costs and Expenses. Cost of sales, consisting primarily of food
and beverage costs, but also including paper and supplies, increased 90
basis points as a percentage of restaurant sales in the first
7
quarter of fiscal 2004 to 28.0% from 27.1% for the same quarter in
fiscal 2003. The increase reflects higher cheese and meat commodity
prices.
Labor and other related expenses decreased as a percentage of
restaurant sales 70 basis points to 32.8% compared with 33.5% for the
same quarter in fiscal 2003. The improvement reflects labor
efficiencies gained from positive same-store sales.
Restaurant operating expenses, which primarily includes rent,
property taxes, utilities, repair and maintenance, liquor taxes and
advertising, as a percentage of restaurant sales decreased 110 basis
points to 23.8% in the first quarter of fiscal 2004 from 24.9% in the
same quarter in fiscal 2003. The decrease reflects advertising
efficiencies gained with the acquisition of the Beaumont-based franchise
restaurants, lower liquor taxes due to lower liquor sales volume in the
Beaumont-based restaurants, as partially offset by higher utility
expenses.
General and administrative expenses consist of expenses
associated with corporate and administrative functions that support
restaurant operations. General and administrative expense decreased as
a percentage of total sales 170 basis points to 7.7% in the first
quarter of fiscal 2004 compared with 9.4% the same quarter one year
ago. The improvement reflects efficiencies gained with the acquisition
of the Beaumont-based restaurants.
Depreciation and amortization expense as a percentage of total
sales decreased 70 basis points to 3.3% in the first quarter of fiscal
2004 from 4.0% for the same quarter in fiscal 2003. The improvement
reflects efficiencies gained with the acquisition of the Beaumont-based
restaurants.
The Company did not open new restaurants in the first quarter
of fiscal 2004.
Restaurant closure costs relate to two restaurants that were
impaired in the fourth quarter of fiscal 2003 but not closed until the
first quarter of fiscal 2004.
Other Income (Expense). Other income, net increased from
income the first quarter of fiscal 2003 to an expense in the first
quarter of fiscal 2004 by $396,823. Interest expense increased $68,783
to $139,265 the first quarter of fiscal 2004 compared with the same
quarter one year ago, reflecting the increase in outstanding debt
incurred for the acquisition of the Beaumont-based restaurants. The
first quarter of fiscal 2003 reflected a partial gain of $316,591 for
insurance proceeds received from fire damage at the Humble, Texas
restaurant location. There were no gains recorded in the first quarter
of fiscal 2004; however, the Company did incur approximately $17,000 in
loss from the disposition of assets.
Income Tax Expense. For the first quarter of fiscal 2004, the
Company's effective tax rate was 31.6% as compared with 32.9% in the
same quarter in fiscal 2003. The effective tax rate is a function of
year-to-date annualizing, the effects of permanent and temporary
differences, the alternative minimum tax and the utilization of tax
credits.
LIQUIDITY AND CAPITAL RESOURCES
The Company met its capital requirements for the 13-weeks
ended March 28, 2004 with cash generated by operations. As of March 28,
2004, the Company's operations generated approximately $2.4 million in
cash, as compared with $227,288 in the same quarter one year ago. As of
March 28, 2004, the Company had a working capital deficit of
approximately $2.5 million, of which $1.0 million reflects the current
portion of principal ($250,000 per quarter) due to Fleet National Bank
under the terms of its credit agreement. A working capital deficit is
common in the restaurant industry, since restaurant companies do not
typically require a significant investment in either accounts
receivable or inventory.
The Company's principal capital requirements are the funding
of routine capital expenditures, new restaurant development or
acquisitions and remodeling of older units. During the first 13 weeks
of fiscal 2004, capital expenditures on property, plant and equipment
were approximately $348,912 as compared to $349,776 for the first 13
weeks of fiscal 2003. The capital expenditures were for
8
necessary replacement of equipment and leasehold improvements in
various older units. The Company estimates its capital expenditures for
the remainder of the fiscal year will be approximately $2.2 million.
On January 7, 2004, the Company completed its purchase of 13
restaurants and related assets from its Beaumont-based franchisee for a
total consideration of approximately $13.75 million. The financing for
the acquisition was provided by Fleet National Bank, CNL Franchise
Network, LP ("CNL') and the sellers of Beaumont-based restaurants.
Fleet National Bank provided $2.5 million of the acquisition financing
by amending its credit facility with Mexican Restaurants, Inc. Six of
the acquired restaurants were concurrently sold to CNL for $8.325
million in a sale-leaseback transaction. The sellers accepted $3.0
million in notes from the Company for the balance of the purchase
price. The seller notes require the payment of interest only for five
years, with $1.5 million in principal due on January 7, 2009 and $1.5
million in principal amortizing over an additional five years.
On January 7, 2004, Fleet National Bank amended its credit
facility to accommodate the acquisition of the Beaumont-based
restaurants. The amended credit facility consists of a $5.0 million
term note that requires quarterly principal payments of $250,000 and
matures on December 31, 2008. The credit facility also includes a $5.0
million revolving line of credit that matures on January 7, 2007. The
interest rate is either the prime rate or LIBOR plus a stipulated
percentage. Accordingly, the Company is impacted by changes in the
prime rate and LIBOR. The Company is subject to a non-use fee of 0.5%
on the unused portion of the revolver from the date of the credit
agreement. As of March 28, 2004, the Company had $4.75 million
outstanding on its term note and $500,000 outstanding on its revolving
line of credit. The Company paid down $600,000 of indebtedness during
the first quarter of fiscal 2004. As of March 28, 2004, the Company was
in compliance with all debt covenants. The Company expects to be in
compliance with the covenants in the credit facility for the next
twelve months.
The Company's management believes that with its operating cash
flow and the Company's revolving line of credit with Fleet National
Bank, funds will be sufficient to meet operating requirements and to
finance routine capital expenditures and remodels through the end of
the 2004 fiscal year. Unless the Company violates an important debt
covenant, the Company's credit facility with Fleet National Bank is not
subject to triggering events that would cause the credit facility to
become due sooner than the maturity dates described above.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company does not have or participate in transactions
involving derivative, financial and commodity instruments. The
Company's long-term debt bears interest at floating market rates. Based
on the amount outstanding at March 28, 2004, a 1% change in interest
rates would change interest expense by $13,125.
ITEM 4. CONTROLS AND PROCEDURES
(a) Evaluation of Disclosure Controls and Procedures
As of the end of the period covered by this report, the
Company carried out an evaluation, under the supervision and with the
participation of the Company's management, including the Company's
President and Chief Executive Officer together with the Company's Chief
Financial Officer, of the effectiveness of the design and operation of
the Company's disclosure controls and procedures, as such term is
defined under Rule 13a-15(e) under the Securities Exchange Act of 1934.
Based upon the evaluation, the Company's President and Chief Executive
Officer and the Company's Chief Financial Officer concluded that the
Company's disclosure controls and procedures are effective in timely
alerting them to material information relating to the Company
(including its subsidiaries) required to be included in the Company's
periodic filings with the Securities and Exchange Commission. There
have been no significant changes in the Company's internal controls or
in other factors that could significantly affect internal controls
subsequent to the date of the evaluation.
(b) Change in Internal Control over Financial Reporting
9
No change in the Company's control over financial reporting
occurred during the Company's most recent fiscal quarter that has
materially affected, or is reasonably likely to materially affect, the
Company's internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) EXHIBITS
Exhibit
Number Document Description
------- --------------------
31.1 Certification of Chief Executive Officer Pursuant to Section 302
of the Sarbanes-Oxley Act of 2002
31.2 Certification of Chief Financial Officer Pursuant to Section 302
of the Sarbanes-Oxley Act of 2002
32.1 Certification of Chief Executive Officer Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002
32.2 Certification of Chief Financial Officer Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002
(b) REPORTS ON FORM 8-K
. There were three reports on Form 8-K filed during the Company's
fiscal quarter ended March 28, 2004. One filing was made on
January 9, 2004 reporting, under item 2 thereto, the Company's
acquisition of 13 restaurants and related assets from its
Beaumont-based franchisee. Another filing was made on March 19,
2004 amending item 7 of the January 9, 2004 filing to include
financial statements and pro forma information. The third filing
was made on March 23, 2004 reporting, under item 7 and 12
thereto, the filing of a press release to announce the Company's
earnings for the fiscal year ended December 28, 2003.
10
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MEXICAN RESTAURANTS, INC.
Dated: May 10, 2004 By: /s/ Curt Glowacki
Curt Glowacki ------------------------
Chief Executive Officer
(Principal Executive Officer)
Dated: May 10, 2004 By: /s/ Andrew J. Dennard
Andrew J. Dennard ------------------------
Senior Vice President, Chief Financial
Officer & Treasurer
(Principal Financial Officer and
(Principal Accounting Officer)
11
EXHIBIT INDEX
(a) EXHIBITS
Exhibit
Number Document Description
------- --------------------
31.1 Certification of Chief Executive Officer Pursuant to Section 302
of the Sarbanes-Oxley Act of 2002
31.2 Certification of Chief Financial Officer Pursuant to Section 302
of the Sarbanes-Oxley Act of 2002
32.1 Certification of Chief Executive Officer Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002
32.2 Certification of Chief Financial Officer Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002