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Note C - Franchise Programs
3 Months Ended
Sep. 03, 2013
Franchise Programs [Abstract]  
Franchise Programs [Text Block]

NOTE C – FRANCHISE PROGRAMS


As of September 3, 2013, our domestic and international franchisees collectively operated 75 Ruby Tuesday restaurants and eight Lime Fresh restaurants. We do not own any equity interest in our franchisees.


Under the terms of the franchise operating agreements, we charge a royalty fee (generally 4.0% of monthly sales) and require all domestic franchisees to contribute a percentage, 0.5% as of September 3, 2013, of monthly gross sales to a national advertising fund formed to cover their pro rata portion of the production and airing costs associated with our national advertising campaign. Under the terms of those agreements, we can charge up to 3.0% of monthly gross sales for this national advertising fund.


Advertising amounts received from domestic franchisees are considered by RTI to be reimbursements, recorded on an accrual basis as earned, and have been netted against selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive (Loss)/Income.


In addition to the advertising fee discussed above, our franchise agreements allow us to charge up to a 2.0% support service fee and a 1.5% marketing and purchasing fee. For the 13 weeks ended September 3, 2013 and September 4, 2012, we recorded $0.3 million for both periods, in support service and marketing and purchasing fees, which were an offset to Selling, general and administrative, net in our Condensed Consolidated Statements of Operations and Comprehensive (Loss)/Income.