13.

Supplemental Condensed Consolidating Financial Statements

As discussed in Note

to the Condensed Consolidated Financial Statements, the Senior Notes are a liability of Ruby Tuesday, Inc. (the “Parent”) and are guaranteed on a senior unsecured basis by our existing and future domestic restricted subsidiaries, subject to certain exceptions (the “Guarantors”). Each of the Guarantors is wholly-owned by Ruby Tuesday, Inc.

None

of the few remaining subsidiaries of Ruby Tuesday, Inc., which were primarily created to hold liquor license assets, guarantee the Senior Notes (the “Non-Guarantors”). Our Non-Guarantor subsidiaries are immaterial and are aggregated within the Parent information disclosed below.

The following condensed consolidating financial information, which has been prepared in accordance with the requirements for presentation of Rule

(f) of Regulation S-

promulgated by the Securities and Exchange Commission, presents the condensed consolidating financial information separately for the Parent, the Guarantors, and elimination entries necessary to consolidate the Parent and Guarantors. Investments in wholly-owned subsidiaries are accounted for using the equity method for purposes of the consolidated presentation. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions.

Condensed Consolidating Balance Sheet

As of

September 5, 2017

(In thousands)

	Parent			Guarantors		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	47,933		$	135	$	–		$	48,068
Restricted cash		30			–		–			30
Accounts and other receivables		1,408			4,448		–			5,856
Inventories		11,754			4,436		–			16,190
Income Tax Receivable		175,585			–		(172,424	)		3,161
Other current assets		13,433			5,849		–			19,282
Total current assets		250,143			14,868		(172,424	)		92,587

Property and equipment, net		433,009			134,105		–			567,114
Investment in subsidiaries		48,846			–		(48,846	)		–
Due from/(to) subsidiaries		97,032			216,009		(313,041	)		–
Other assets		37,473			3,848		–			41,321
Total assets	$	866,503		$	368,830	$	(534,311	)	$	701,022

Liabilities & Shareholders ’ Equity
Current liabilities:
Accounts payable	$	10,440		$	2,530	$	–		$	12,970
Accrued and other current liabilities		41,331			31,359		–			72,690

Current maturities of long-term debt, including capital leases		(1,179	)		1,558		–			379
Income tax payable		–			172,424		(172,424	)		–
Total current liabilities		50,592			207,871		(172,424	)		86,039

Long-term debt and capital leases, less current maturities		210,559			2,696		–			213,255
Due to/(from) subsidiaries		216,009			97,032		(313,041	)		–
Other deferred liabilities		91,445			12,385		–			103,830
Total liabilities		568,605			319,984		(485,465	)		403,124

Shareholders ’ equity:
Common stock		610			–		–			610
Capital in excess of par value		79,762			–		–			79,762
Retained earnings		225,364			48,846		(48,846	)		225,364
Accumulated other comprehensive loss		(7,838	)		–		–			(7,838	)
Total shareholders ’ equity		297,898			48,846		(48,846	)		297,898
Total liabilities & shareholders ’ equity	$	866,503		$	368,830	$	(534,311	)	$	701,022

Condensed Consolidating Balance Sheet

As of

June 6, 2017

(In thousands)

	Parent			Guarantors		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	41,584		$	130	$	–		$	41,714
Restricted cash		6,445			–		–			6,445
Accounts and other receivables		1,913			5,402		–			7,315
Inventories		12,447			4,731		–			17,178
Income tax receivable		175,535			–		(172,474	)		3,061
Other current assets		15,969			7,355		–			23,324
Total current assets		253,893			17,618		(172,474	)		99,037

Property and equipment, net		446,211			136,886		–			583,097
Investment in subsidiaries		51,214			–		(51,214	)		–
Due from/(to) subsidiaries		94,281			213,066		(307,347	)		–
Other assets		37,454			4,054		–			41,508
Total assets	$	883,053		$	371,624	$	(531,035	)	$	723,642

Liabilities & Shareholders ’ Equity
Current liabilities:
Accounts payable	$	14,333		$	3,237	$	–		$	17,570
Accrued and other current liabilities		47,796			33,340		–			81,136

Current maturities of long-term debt, including capital leases		(1,157	)		1,525		–			368
Income tax payable		–			172,474		(172,474	)		–
Total current liabilities		60,972			210,576		(172,474	)		99,074

Long-term debt and capital leases, less current maturities		210,243			3,098		–			213,341
Due to/(from) subsidiaries		213,066			94,281		(307,347	)		–
Other deferred liabilities		91,406			12,455		–			103,861
Total liabilities		575,687			320,410		(479,821	)		416,276

Shareholders ’ equity:
Common stock		607			–		–			607
Capital in excess of par value		79,531			–		–			79,531
Retained earnings		235,210			51,214		(51,214	)		235,210
Accumulated other comprehensive loss		(7,982	)		–		–			(7,982	)
Total shareholders ’ equity		307,366			51,214		(51,214	)		307,366
Total liabilities & shareholders ’ equity	$	883,053		$	371,624	$	(531,035	)	$	723,642

Condensed Consolidating Statement of Operations and

Comprehensive Loss

For the Thirteen Weeks Ended

September 5

201

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Revenue:
Restaurant sales and operating revenue	$	159,365		$	57,041		$	–		$	216,406
Franchise revenue		–			901			–			901
Total revenue		159,365			57,942			–			217,307

Operating costs and expenses:
Cost of goods sold		42,947			15,352			–			58,299
Payroll and related costs		54,996			21,521			–			76,517
Other restaurant operating costs		34,071			12,008			–			46,079
Depreciation and amortization		7,038			2,391			–			9,429
G eneral and administrative expenses		14,790			(906	)		–			13,884
Intercompany general and administrative allocations		2,189			(2,189	)		–			–
Marketing expenses, net		7,575			2,428			–			10,003
Closures and impairments, net		7,208			611			–			7,819
Equity in earnings of subsidiaries		(4,972	)		–			4,972			–
Interest expense, net		4,970			102			–			5,072
Intercompany interest expense/(income)		2,943			(2,943	)		–			–
Total operating costs and expenses		173,755			48,375			4,972			227,102

( Loss)/income before income taxes		(14,390	)		9,567			(4,972	)		(9,795	)
(Benefit)/provision for income taxes		(4,544	)		4,595			–			51

Net (loss)/income	$	(9,846	)	$	4,972		$	(4,972	)	$	(9,846	)

Other comprehensive income:
Pension liability reclassification		144			–			–			144
Total comprehensive (loss)/income	$	(9,702	)	$	4,972		$	(4,972	)	$	(9,702	)

Condensed Consolidating Statement of Operations and

Comprehensive Loss

For the Thirteen Weeks Ended

August 30, 2016

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Revenue:
Restaurant sales and operating revenue	$	185,088		$	70,676		$	–		$	255,764
Franchise revenue		10			883			–			893
Total revenue		185,098			71,559			–			256,657

Operating costs and expenses:
Cost of goods sold		52,182			20,008			–			72,190
Payroll and related costs		63,575			27,032			–			90,607
Other restaurant operating costs		40,976			16,387			–			57,363
Depreciation and amortization		8,088			3,141			–			11,229
General and administrative expenses		8,041			8,048			–			16,089
Intercompany general and administrative allocations		10,363			(10,363	)		–			–
Marketing expenses, net		11,345			4,151						15,496
Closures and impairments, net		16,584			13,608			–			30,192
Equity in losses of subsidiaries		9,032			–			(9,032	)		–
Interest expense, net		4,582			295			–			4,877
Intercompany interest expense/(income)		2,953			(2,953	)		–			–
Total operating costs and expenses		227,721			79,354			(9,032	)		298,043

Loss before income taxes		(42,623	)		(7,795	)		9,032			(41,386	)
(Benefit)/provision for income taxes		(2,931	)		1,237			–			(1,694	)
Net (loss)/income	$	(39,692	)	$	(9,032	)	$	9,032		$	(39,692	)

Other comprehensive income:
Pension liability reclassification, net of tax		355			–			–			355
Total comprehensive loss	$	(39,337	)	$	(9,032	)	$	9,032		$	(39,337	)

Condensed Consolidating Statement of Cash Flows

For the Thirteen Weeks Ended

September 5, 2017

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated

Net cash provided by operating activities	$	1,512		$	5,549		$	(4,397	)	$	2,664

Investing activities:
Purchases of property and equipment		(3,609	)		(1,265	)		–			(4,874	)
Proceeds from disposal of assets		5,547			3,433			–			8,980
Insurance proceeds from property claims		567			-			-			567
Reductions in Deferred Compensation Plan assets		344			-			-			344
Other, net		(26	)		–			–			(26	)
Net cash provided by investing activities		2,823			2,168			–			4,991

Financing activities:
Principal payments on long-term debt		12			(372	)		–			(360	)
Payments for debt issuance costs		(941	)		–			–			(941	)
Dividends Paid		–			(7,340	)		7,340			–
Other intercompany transactions		2,943			–			(2,943	)		–
Net cash provided/(used) by financing activities		2,014			(7,712	)		4,397			(1,301	)

Decrease in cash and cash equivalents		6,349			5			–			6,354
Cash and cash equivalents:
Beginning of fiscal year		41,584			130			–			41,714
End of quarter	$	47,933		$	135		$	–		$	48,068

Condensed

Consolidating Statement of Cash Flows

For the Thirteen Weeks Ended

August 30, 2016

(In thousands)

	Parent			Guarantors			Eliminations			Consolidated
Net cash (used)/provided by operating activities	$	(2,847	)	$	9,280		$	(4,462	)	$	1,971

Investing activities:
Purchases of property and equipment		(4,992	)		(1,366	)		–			(6,358	)
Proceeds from disposal of assets		5,257			–			–			5,257
Other, net		1,322			–			–			1,322
Net cash provided/(used) by investing activities		1,587			(1,366	)		–			221

Financing activities:
Principal payments on long-term debt		11			(486	)		–			(475	)
Stock repurchases		(26	)		–			–			(26	)
Payments for debt issuance costs		(7	)		–			–			(7	)
Intercompany dividend		–			(7,415	)		7,415			–
Other intercompany transactions		2,953			–			(2,953	)		–
Net cash provided/(used) by financing activities		2,931			(7,901	)		4,462			(508	)

Decrease in cash and cash equivalents		1,671			13			–			1,684
Cash and cash equivalents:
Beginning of fiscal year		66,831			133			–			66,964
End of quarter	$	68,502		$	146		$	–		$	68,648