<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB/A
(Mark One)
/X/ QUARTERLY REPORT UNDER SECTION 13 0R 15(d) OF THE
SECURITIES EXCHANGE ACT 1934
For the quarterly period ended September 29, 1996
/ / TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
Commission file number 0-20845
MICHIGAN BREWERY, INC.
(Exact name of Registrant as specified in its charter)
Michigan 38-3196031
(State of other jurisdiction of (IRS Employer Identification No.)
incorporation or organization
1999 WALDEN DRIVE
GAYLORD, MICHIGAN 49735
(517) 731-0401
(Address of principal executive offices and Registrant's
telephone number, including area code)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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
-----
As of November 11, 1996 , there were outstanding 5,275,000 shares of
common stock, $.01 par value, of the registrant.
<PAGE>
MICHIGAN BREWERY, INC.
FORM 10-QSB/A
INDEX
PAGE
NUMBER
------
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Balance Sheets as of September 29, 1996 and
December 31, 1995 1
Statements of Operations for the three months 2
ended September 29, 1996 and for the thirteen
weeks ended September 30, 1995 and for the
nine months ended September 29, 1996 and for
the thirty-nine weeks ended September 30, 1995
Statements of Cash Flows for the nine months 3
ended September 29, 1996 and for the thirty-
nine weeks ended September 30, 1995
Notes to Financial Statements 4
Item 2 Management's Discussion and Analysis of 5
Financial Condition and Results of Operations
PART II OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K 9
SIGNATURES 10
EXHIBIT INDEX 11
<PAGE>
MICHIGAN BREWERY, INC.
BALANCE SHEETS
SEPTEMBER 29, DECEMBER 31,
ASSETS 1996 1995
---- ----
(UNAUDITED)
CURRENT ASSETS:
Cash and cash equivalents 6,390,061 339,062
Inventories 152,426 140,195
Prepaids and other 159,857 36,236
------- ------
Total current assets 6,702,344 515,493
PROPERTY AND EQUIPMENT, net 8,514,020 5,751,313
OTHER ASSETS, net 90,372 85,785
------ ------
15,306,736 6,352,591
---------- ---------
---------- ---------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable - trade 161,067 246,246
Accounts payable - related party 30,972 480,986
Accrued expenses 69,086 145,496
Notes payable to shareholders - 300,000
Line of credit - 325,000
Current maturities of long-term debt 250,080 731,068
------- -------
Total current liabilities 511,205 2,228,796
LONG-TERM DEBT, less current maturities 2,277,474 2,714,141
--------- ---------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Common stock, $.01 par value, 10,000,000
shares authorized; 5,275,000 and
2,500,000 shares issued and outstanding 52,750 25,000
Warrants 26,150 18,600
Class A warrants 127,500
Additional paid-in capital 14,150,961 2,482,470
Accumulated deficit (1,839,304) (1,116,416)
---------- ----------
Total shareholders' equity 12,518,057 1,409,654
---------- ----------
15,306,736 6,352,591
---------- ---------
---------- ---------
The accompanying notes are an intergral part of these balance sheets.
1
<PAGE>
MICHIGAN BREWERY, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Thirteen Weeks Three Months Thirty-nine Nine Months
Ended Ended Weeks Ended Ended
September 29, September 30, September 29, September 30,
1996 1995 1996 1995
------------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
REVENUE:
Restaurant sales $1,361,226 $1,245,679 $3,134,995 $1,530,164
Wholesale beer and gift shop sales 179,703 113,675 348,431 137,863
------- ------- ------- -------
TOTAL REVENUE 1,540,929 1,359,354 3,483,426 1,668,027
COSTS AND EXPENSES:
Cost of sales 556,601 621,062 1,284,880 887,465
Restaurant salaries and benefits 369,923 401,983 965,389 570,961
Operating expenses 271,083 315,131 854,268 537,627
Depreciation and amortization 108,413 65,567 356,560 109,278
------- ------ ------- -------
Total costs and expenses 1,306,020 1,403,743 3,461,097 2,105,331
--------- --------- --------- ---------
Restaurant Operating Income ( Loss) 234,909 (44,389) 22,329 (437,304)
General and Administrative Expenses 273,474 65,998 604,865 101,137
------- ------ ------- -------
LOSS FROM OPERATIONS (38,565) (110,387) (582,536) (538,441)
Interest expense 66,427 77,667 277,664 171,847
Interest income (112,576) - (137,312) -
-------- -------- -------- --------
NET INCOME (LOSS) $7,584 ($188,054) ($722,888) ($710,288)
------ -------- -------- --------
------ -------- -------- --------
NET LOSS PER COMMON SHARE $0.00 ($0.07) ($0.20) ($0.28)
----- ----- ----- -----
----- ----- ----- -----
WEIGHTED AVERAGE SHARES OUTSTANDING 5,248,626 2,603,709 3,663,095 2,497,412
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
MICHIGAN BREWERY, INC.
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Thirty-nine Nine Months
Weeks Ended Ended
SEPTEMBER 29, SEPTEMBER 30,
1996 1995
---- ----
<S> <C> <C>
OPERATING ACTIVITIES:
Net loss ($722,888) ($710,288)
Adjustments to reconcile net loss to cash flows
used in operating activities-
Depreciation and amortization 356,560 109,278
Change in operating assets and liabilities:
Inventories (12,231) (158,051)
Prepaids and other (128,208) (20,682)
Accounts payable (535,193) 874,419
Accrued expenses (76,410) 54,596
----- ------
Net cash provied by (used in) operating
activities (1,118,370) 149,272
---------- --------
INVESTING ACTIVITIES:
Purchases of property and equipment, net (2,978,540) (4,991,540)
---------- ----------
FINANCING ACTIVITIES:
Proceeds from line-of-credit borrowings 325,000
Payments on line-of-credit borrowings (325,000) 0
Net proceeds from initial public offering
of units including over-allotment 11,411,250 0
Payments on debt to shareholders (300,000) (250,000)
Proceeds from long-term debt 750,000 2,688,835
Payments on long-term debt (1,417,655) 0
Proceeds from issuance of common stock 647,500 4,750
Proceeds from issuance of warrants 7,550 0
Capital Contributions 0 2,100,720
Payment of financing costs (147,802) (70,322)
Payment of public offering costs (477,934) 0
------- --------
Net cash provided by financing
activities 10,147,909 4,798,983
---------- ---------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 6,050,999 (43,285)
CASHAND CASH EQUIVALENTS, beginning of period 339,062 181,185
------- -------
CASH AND CASH EQUIVALENTS, end of period $ 6,390,061 $137,900
---------- --------
---------- --------
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid $ 300,658 $147,495
Income taxes paid $ - $ -
NONCASH TRANSACTION:
Conversion of debt to common stock $ 250,000 $ -
</TABLE>
The accompanying notes are an integral part of these financial
statements.
3
<PAGE>
MICHIGAN BREWERY, INC.
Notes to Financial Statements
September 29, 1996
(1) The accompanying financial statements included herein have been prepared by
Michigan Brewery, Inc. (the Company), without audit, in accordance with
generally accepted accounting principles for interim financial information
and pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules
and regulations, although the Company believes that the disclosures made
are adequate to make the information contained herein not misleading.
The unaudited balance sheet as of September 29, 1996 and the unaudited
statements of operations for the thirteen and thirty-nine weeks ended
September 29, 1996 and the unaudited statement of cash flows for the
thirty-nine weeks ended September 29, 1996 include, in the opinion of
management, all adjustments, consisting solely of normal recurring
adjustments, necessary for a fair presentation of the financial results for
the respective interim periods and are not necessarily indicative of
results of operations to be expected for the entire fiscal year ending
December 29, 1996. The accompanying interim financial statements have been
prepared under the presumption that users of the interim financial
information have either read, or have access to, the audited financial
statements and notes in the Company's Registration Statement on Form SB-2.
Accordingly, footnote disclosures which would substantially duplicate the
disclosures contained in the December 31, 1995 audited financial statements
have been omitted from these interim financial statements except for the
disclosures below. It is suggested that these interim financial statements
should be read in conjunction with the financial statements and the notes
thereto included in the Company's Registration Statement.
(2) On June 13, 1996, the Securities and Exchange Commission declared effective
a Registration Statement on Form SB-2 relating to the initial public
offering of the Company's 2,450,000 units, each unit consisting of one
share of common stock and one redeemable Class A warrant. Following the
effective date of the Registration Statement, the Company issued 2,450,000
units at $5.00 per unit and the Company received net proceeds of $10,963,750
million on June 18, 1996. The financial statements reflect the effect of
this offering net of transaction related expenses.
On July 25, 1996, the underwriters exercised a portion of their
overallotment option and the Company issued 100,000 additional units at
$5.00 per unit. The Company received net proceeds of $447,500 on July 30,
1996.
(3) Effective January 1, 1996, the Company changed its fiscal year from a
calendar year-end to a 52-53 week year. Accordingly, the quarter ended
September 29, 1996 consisted of thirteen weeks and the three quarters ended
September 29, 1996 consisted of thirty-nine weeks. The quarter ended
September 30, 1995 consisted of thirteen weeks and one day and the three
quarters ended September 30, 1995 consisted of thirty-nine weeks. The
Company believes that the change in reporting periods does not have a
material effect on the comparability of the accompanying financial
statements.
(4) The Company had been an S corporation since inception for federal income
tax purposes. As a result, the Company's losses were, for federal and
state income tax purposes, included in the personal tax returns of the
Company's shareholders. The Company entered into a financing agreement,
with Pyramid Partners, L.P. for the issuance of a convertible note which
was convertible into 75,000 shares of common stock and included warrants to
purchase 62,500 shares of common stock, which terminated the S corporation
status effective December 21, 1995.
As of September 29, 1996, the Company had net operating loss carryforwards
for income tax purposes of approximately $1.1 million. These net operating
loss carryforwards expire in the year 2011. Because of the lack of
profitability, a full valuation allowance has been recorded against the net
deferred tax asset.
4
<PAGE>
ITEM 2.
Management's Discussion and Analysis of
Financial Condition and Results of Operations
THIS DISCUSSION AND ANALYSIS CONTAINS CERTAIN FORWARD-LOOKING TERMINOLOGY
SUCH AS "BELIEVES," "ANTICIPATES," "EXPECTS," AND "INTENDS," OR COMPARABLE
TERMINOLOGY. SUCH STATEMENTS ARE SUBJECT TO CERTAIN RISKS AND UNCERTAINTIES
THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE PROJECTED.
POTENTIAL PURCHASERS OF THE COMPANY'S SECURITIES ARE CAUTIONED NOT TO PLACE
UNDUE RELIANCE ON SUCH FORWARD-LOOKING STATEMENTS WHICH ARE QUALIFIED IN
THEIR ENTIRETY BY THE CAUTIONS AND RISKS DESCRIBED HEREIN.
Overview
The Company was capitalized in 1994 to develop, own and operate
microbrewery/restaurants with the name Big Buck Brewery and Steakhouses (Big
Buck Breweries). Until May 1995 when the Gaylord Brewery opened, the Company
had no operations or revenues and its activities were devoted solely to
development.
Future revenues and profits will depend upon various factors, including market
acceptance of Big Buck Breweries and general economic conditions. The Company's
present sole source of revenue is the Gaylord Brewery. There can be no
assurance that the Company will successfully implement its expansion plans, in
which case the Company will continue to be dependent on the revenues from the
Gaylord Brewery. The Company also faces all of the risks, expenses and
difficulties frequently encountered in connection with the expansion and
development of a new business. Furthermore, to the extent that the Company's
expansion strategy is successful, it must manage the transition to multiple
sites, higher volume operations, the control of overhead expenses and the
addition of necessary personnel.
The Company's sales and earnings are expected to fluctuate based on seasonal
patterns. The Company anticipates that its highest earnings will occur in the
second and third quarters. Quarterly results in the future are likely to be
substantially affected by the timing of new brewery openings. Because of the
seasonality of the Company's business and the impact of new brewery openings,
results for any quarter are not necessarily indicative of the results that may
be achieved for a full fiscal year and cannot be used to indicate financial
performance for the entire year.
The Company has purchased a 6.1 acre site on Opdyke Road in Auburn Hills,
Michigan. The site is just off of Interstate 75 at exit 79. The new
facility will encompass 26,372 square feet including brewery, bar and
restaurant. Seating capacity in the restaurant will be just under 400 and the
bar will accommodate nearly 270. Construction is expected to begin by late
November provided that final approval by the city of Auburn Hills is
received. The Company anticipates opening the brewery during the third
quarter of 1997. The Company expects to close on the purchase of the Grand
Rapids, Michigan site by year ended provided that approval is received from
the city of Grand Rapids. The site is an existing structure of approximately
8,200 square feet and is located on 28th Street in Grand Rapids. Seating
capacity will be around 280 for restaurant and bar combined. Opening for the
Grand Rapids facility is expected to be in the first quarter of 1997.
5
<PAGE>
QUARTERS ENDED SEPTEMBER 30, 1995 AND SEPTEMBER 29, 1996 AND NINE MONTHS ENDED
SEPTEMBER 30, 1995 AND THIRTY-NINE WEEKS ENDED SEPTEMBER 29, 1996
The following table is derived from the Company's statements of operations and
expresses the results from operations as a percent of total revenue:
<TABLE>
<CAPTION>
Thirteen Three Thirty-Nine Nine
Weeks Months Weeks Months
Ended Ended Ended Ended
September 29, September 30, September 29, September 30,
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUE:
Restaurant sales 88.3% 91.6% 90.0% 91.7%
Wholesale beer and gift shop sales 11.7% 8.4% 10.0% 8.3%
----- ---- ----- ----
Total revenue 100.0% 100.0% 100.0% 100.0%
----- ----- ----- -----
----- ----- ----- -----
COST AND EXPENSES:
Cost of sales 36.1% 45.7% 36.9% 53.2%
Restaurant salaries and benefits 24.0% 29.6% 27.7% 34.2%
Operating expenses 17.6% 23.2% 24.5% 32.2%
Depreciation and amortization 7.0% 4.8% 10.2% 6.6%
---- ---- ----- ----
Total costs and expenses 84.7% 103.3% 99.3% 126.2%
----- ----- ----- -----
Restaurant Operating Income or (Loss) 15.3% (3.3%) 0.7% (26.2%)
General and Administrative Expenses 17.7% 4.9% 17.4% 6.1%
----- ---- ----- ----
LOSS FROM OPERATIONS (2.4%) (8.2%) (16.7%) (32.3%)
Interest expense, net (3.0%) 5.7% 4.1% 10.3%
----- ---- ---- -----
NET INCOME (LOSS) 0.6% (13.9%) (20.8%) (42.6%)
---- ----- ----- -----
</TABLE>
RESULTS OF OPERATIONS
REVENUES
Revenues increased $181,575 to $1,540,929 in the quarter ended September 29,
1996 from $1,359,354 in the quarter ended September 30, 1995. For the
thirty-nine weeks ended September 29, 1996, revenues increased $1,815,3999 to
$3,483,426 from $1,668,027 for the nine months ended September 30, 1995. The
increase in the quarterly revenues is due to improved operating efficiencies
including a decrease in cooking times and an increase in overall check
average from improved training and development of the staff in the area of
selling the menu. The large increase in the year to date figures is due the
Gaylord Brewery being open for only 128 days thru September 30, 1995, opening
to the public on May 26, 1995.
COST OF SALES
Cost of sales, which consists of food, merchandise and brewery supplies,
decreased $64,461 to $556,601 in the third quarter of 1996 from the third
quarter of 1995 and increased $397,415 to $1,284,880 for the thirty-nine
weeks ended September 29, 1996 compared to the nine months ended September
30, 1995. As a percentage of revenues, cost of sales decreased to 36.1% in
the third quarter of 1996 from 45.7% for the third quarter of 1995 and
decreased to 36.9% for the thirty-nine weeks ended September 29, 1996 from
53.2% for the nine months ended September 30, 1995. These decreases are the
result of price increases, operating efficiencies, improved purchasing
efficiencies and more experienced kitchen management.
RESTAURANT SALARIES AND BENEFITS
Restaurant salaries and benefits, which consist of restaurant management and
hourly employee wages and benefits, payroll taxes and workers' compensation
insurance, decreased $32,060 to $369,923 in the
6
<PAGE>
third quarter of 1996 compared to the second quarter in 1995 and increased
$394,428 to $965,389 for the thirty-nine weeks ended September 29, 1996 as
compared to the nine months ended September 30, 1995. As a percentage of
revenues, restaurant salaries and benefits decreased to 24.0% in the third
quarter of 1996 compared to 29.6% in 1995, and decreased to 27.7% for the
thirty-nine week ended September 29, 1996 as compared to 34.2% for the nine
months ended September 30, 1995. The decreases are due primarily to
improvements in training and scheduling.
OPERATING EXPENSES
Operating expenses, which include supplies, utilities, repairs and maintenance,
advertising and occupancy costs decreased $44,048 to $271,083 in the third
quarter of 1996 compared to the third quarter of 1995, and increased $316,641 to
$854,268 for the thirty-nine weeks ended September 29, 1996 as compared to the
nine months ended September 30, 1995. As a percentage of revenues, operating
expenses decreased to 17.6% in the third quarter of 1996 from 23.2% for the
third quarter in 1995, and decreased to 24.5% for the thirty-nine weeks ended
September 29, 1996 from 32.2% for the nine months ended September 30, 1995.
These decreases are due to improved management and operating controls.
ADMINISTRATIVE AND DEVELOPMENT EXPENSES
Administrative and development expenses increased $207,476 to $273,474 in the
third quarter of 1996 compared to the third quarter of 1995, and increased
$503,728 to $604,865 in the thirty-nine weeks ended September 29, 1996
compared to the nine months ended September 30, 1995. As a percentage of
revenues, such expenses increased to 17.7% in the third quarter of 1996 from
4.9% for the third quarter of 1995, and increased to 17.4% for the thirty-nine
weeks ended September 29, 1996 from 6.1% for the nine months ended September 30,
1995. The increases in these expenses are the result of hiring additional
senior corporate management, additional professional fees associated with being
a public company. As the Company opens additional breweries, these expenses as
a percentage of revenues are expected to decrease.
DEPRECIATION AND AMORTIZATION
Depreciation and amortization expenses increased $42,846 to $108,413 in the
third quarter of 1996 compared to the third quarter of 1995, and increased
$247,282 to $356,560 for the thirty-nine weeks ended September 29, 1996
compared to the nine months ended September 30, 1995. As a percentage of
revenues these expenses increased to 7.0% in the third quarter of 1996 from 4.8%
for the third quarter of 1995, and increased to 10.2% for the thirty-nine weeks
ended September 29, 1996 from 6.6% for the nine months ended September 30, 1995.
The increases in these expenses are the result of the final amortization of cost
related to the Bridge Financing which took place in early 1996, depreciation
expense increased due to the fact the Gaylord Brewery was in operation for three
quarters in 1996 as compared to opening in May of 1995.
INTEREST EXPENSES/INTEREST INCOME
Interest expense decreased $11,240 to $66,427 in the third quarter of 1996
compared to third quarter of 1995, and increased $105,817 to $277,664 for the
thirty-nine weeks ended September 29, 1996 compared to the nine months ended
September 30, 1995. The increase in the year to date expense is due to
additional interest expense from the Bridge Financing for 1996.
Interest income was $112,576 in the third quarter of 1996 compared to none for
the third quarter of 1995 and was $137,312 for the thirty-nine weeks ended
September 29, 1996 compared to none for the nine months ended September 30,
1995. The increase in interest income is due to the investing of the proceeds
from the Bridge Financing and the Company's public offering completed in June
1996.
LIQUIDITY AND CAPITAL RESOURCES
The Company generated $149,000 in cash for the nine months ended September 30,
1995 and used $1,118,000 in cash for the thirty-nine weeks ended September 29,
1996 from operating activities. At September 29, 1996, the company had working
capital of $6.2 million. The Company expects that it will use a significant
portion of its capital resources to fund new brewery development and
construction. Since inception, the Company's principal capital requirements
have been the funding of (i) the Company and the Big Buck Brewery format and
(ii) the construction of the Gaylord Brewery and the acquisition of its
furniture, fixtures and equipment. Total capital expenditures for the Gaylord
Brewery were approximately $5.8 million.
7
<PAGE>
The Company generated approximately $10,150,000 in cash from financing
activities during the thirty-nine weeks ended September 29, 1996. On June 13,
1996, the Company's initial public offering of 2,450,000 units at
$5.00 per unit, each unit consisting of one share of common stock and one
redeemable Class A warrant, became effective with the Securities and Exchange
Commission. The Company received net proceeds of $10,963,750 on June 18, 1996.
On July 25, 1996, the underwriters exercised a portion of their overallotment
option for 100,000 additional units at $5.00 per unit. The Company received
net proceeds of $447,500 on July 30, 1996. Total net proceeds have
been reflected in the unaudited financial statements net of transaction related
expenses.
Prior to the initial public offering, the Company has met its capital
requirements through capital contributions, loans from its principal
shareholders and officers, bank borrowings and certain private placement
offerings.
In December 1995 the Company entered into a financing agreement with Pyramid
Partners, L.P. for the issuance for (i) $250,000 noninterest-bearing promissory
note (the Pre-Bridge Convertible Note) which is convertible into a number of
shares of common stock equal to $250,000 divided by the less of (x) $4.00
or (y) two-thirds of the price to public of the units in the Offering, (ii) a
$250,000 nonconvertible promissory note bearing interest at 10% per annum which
will become due upon the earlier of the completion of the Offering or July 1996,
and (iii) warrants to purchase 62,500 shares of common stock at the lesser of
(x) $4.00 or (y) two-thirds of the price to the public of the units in the
Offering. During June 1996, the Pre-Bridge Convertible Note was converted to
75,000 shares of the Company's common stock and the other note was repaid in
full.
In February 1996, the Company sold, for $25,000 each, 60 bridge units, each
bridge unit consisting of (i) 2,500 share of common stock, (ii) a $12,500
principal amount promissory note bearing interest at 10% per annum due upon
the earlier of 20 days after the completion of the initial public offering or
August 1996, and (iii) warrants to purchase 2,500 shares of common stock at
$5.00 per share expiring in February 2001. The promissory notes were repaid
in full in July 1996.
The proceeds of the private placements were used to retire certain debt,
purchase additional brewing and bottling equipment, purchase an option to
acquire a potential site for a future brewery and for working capital.
The Company anticipates it will develop and open three additional Big Buck
Breweries during the next fifteen months. The Company intends to obtain real
estate financing for up to 55% of the cost of developing and opening the
three new breweries. The net proceeds of the initial public offering
together with such financing are expected to be sufficient to finance these
expansion plans depending on the definitive locations, site conditions,
construction costs and sized and types of breweries built. There can be no
assurance that such real estate financing will be available on terms,
acceptable or favorable to the Company, or at all. Without such additional
financing, the Company's development plans will be slower than planned or
even unachievable.
8
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
Exhibit 9 - Computation of Net Loss Per Common Share
Exhibit 27 - Financial Data Schedule
b. Reports on Form 8-K
None.
9
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Michigan Brewery, Inc.
(Registrant)
Date: November 18, 1996 By: /S/ Anthony P. Dombrowski
-------------------------
Anthony P. Dombrowski
Chief Financial Officer
10
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
Michigan Brewery, Inc.
Exhibit Index to Form 10-QSB/A
EXHIBIT NUMBER DESCRIPTION
9 Computation of Net Loss Per Common Share
27 Financial Data Schedule
11
<PAGE>
MICHIGAN BREWERY, INC.
COMPUTATION OF NET LOSS PER COMMON SHARE
<TABLE>
<CAPTION>
Three Thirteen Nine Thirty-Nine
Months Weeks Months Weeks
Ended Ended Ended Ended
September 30, September 29, September 30, September 29,
1995 1996 1995 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Weighted average number of issued
shares outstanding 2,185,326 2,500,000 2,079,029 2,500,000
Effect of:
Common shares issued during
1996 (1) 0 2,748,626 0 1,163,095
Dilutive effect of cheap stock after
application of treasury
stock method (1) 418,383 0 418,383 0
---------- ---------- ---------- ----------
Shares outstanding used to compute
net income (loss) per share 2,603,709 5,248,626 2,497,412 3,663,095
---------- ---------- ---------- ----------
Net income (loss) ($188,054) $7,584 ($710,288) ($722,888)
----------- ---------- ---------- ----------
----------- ---------- ---------- ----------
Net income (loss) per common share ($0.07) $0.00 ($0.28) ($0.20)
----------- ---------- ----------
</TABLE>
(1) Cheap stock and common shares issued during 1996 are included in the
computation for all periods presented in accordance with Staff Accounting
Bulletin Topic 4 (D).
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-29-1996
<PERIOD-END> SEP-29-1996
<CASH> 6,390,061
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 152,426
<CURRENT-ASSETS> 6,702,344
<PP&E> 8,514,020
<DEPRECIATION> 0
<TOTAL-ASSETS> 15,306,736
<CURRENT-LIABILITIES> 511,205
<BONDS> 2,277,474
0
0
<COMMON> 52,750
<OTHER-SE> 12,465,307
<TOTAL-LIABILITY-AND-EQUITY> 15,306,736
<SALES> 3,483,426
<TOTAL-REVENUES> 3,483,426
<CGS> 1,284,880
<TOTAL-COSTS> 3,461,097
<OTHER-EXPENSES> 604,865
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 140,352
<INCOME-PRETAX> (722,888)
<INCOME-TAX> 0
<INCOME-CONTINUING> (722,888)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (722,888)
<EPS-PRIMARY> (0.20)
<EPS-DILUTED> (0.20)
</TABLE>
