10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________ 

FORM 10-Q

Quarterly Report Pursuant to Section 13 or 15 (d) of

the Securities Exchange Act of 1934

FOR QUARTERLY PERIOD ENDED MARCH 4, 2014

COMMISSION FILE NUMBER 001-7323

________________________________ 

FRISCH’S RESTAURANTS, INC.

(Exact name of registrant as specified in its charter)

OHIO	31-0523213
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
2800 Gilbert Avenue, Cincinnati, Ohio	45206
(Address of principal executive offices)	(Zip Code)
Registrant’s telephone number, including area code	513-961-2660

Not Applicable

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  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit and post such files).    YES  x    NO  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  ¨	Accelerated filer  x
Non-accelerated filer  ¨	Smaller reporting company  ¨
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES  ¨ NO  x

There were 5,099,012 shares outstanding of the issuer’s no par common stock, as of March 27, 2014.

TABLE OF CONTENTS

		Page
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements:
	Condensed Consolidated Statement of Earnings	3
	Condensed Consolidated Statement of Comprehensive Income	4
	Condensed Consolidated Balance Sheet	5
	Condensed Consolidated Statement of Shareholders’ Equity	7
	Condensed Consolidated Statement of Cash Flows	8
	Notes to Condensed Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	33
Item 4.	Controls and Procedures	33
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3.	Defaults Upon Senior Securities	34
Item 4.	Mine Safety Disclosures	35
Item 5.	Other Information	35
Item 6.	Exhibits	35
SIGNATURE		36

Frisch’s Restaurants, Inc. and Subsidiaries

Condensed Consolidated Statement of Earnings

(Unaudited)

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands, except per share data)
Sales	$	155,614		$	154,920		$	45,161		$	45,772
Cost of sales
Food and paper	51,866			51,857			15,163			15,422
Payroll and related	55,399			54,367			16,679			16,281
Other operating costs	32,745			31,961			9,752			9,102
	140,010			138,185			41,594			40,805
Gross profit	15,604			16,735			3,567			4,967
Administrative and advertising	9,443			10,109			2,846			2,695
Franchise fees and other revenue	(1,076		)	(1,057		)	(293		)	(306		)
(Gain)/Loss on sale of assets	(67		)	14			—			—
Impairment of long-lived assets	—			71			—			—
Operating profit	7,304			7,598			1,014			2,578
Interest expense	471			759			120			209
Earnings from continuing operations before income taxes	6,833			6,839			894			2,369
Income tax expense (benefit)	972			2,133			(691		)	621
Earnings from continuing operations	5,861			4,706			1,585			1,748
Loss from discontinued operations, net of tax	—			(158		)	—			—
NET EARNINGS	$	5,861		$	4,548		$	1,585		$	1,748
Basic net earnings per share:
Earnings from continuing operations	$	1.15		$	0.94		$	0.31		$	0.35
(Loss) from discontinued operations	—			(0.03		)	—			—
Basic net earnings per share	$	1.15		$	0.91		$	0.31		$	0.35
Diluted net earnings per share:
Earnings from continuing operations	$	1.15		$	0.93		$	0.31		$	0.34
(Loss) from discontinued operations	—			(0.03		)	—			—
Diluted net earnings per share	$	1.15		$	0.90		$	0.31		$	0.34

The accompanying notes are an integral part of the condensed consolidated financial statements.

3

Frisch’s Restaurants, Inc. and Subsidiaries

Condensed Consolidated Statement of Comprehensive Income

(Unaudited)

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands)
Net earnings	$	5,861		$	4,548		$	1,585		$	1,748
Other comprehensive income
Amortization of amounts included in net periodic pension expense	648			1,311			194			394
Tax effect	(220		)	(446		)	(66		)	(134		)
Total other comprehensive income	428			865			128			260
Comprehensive income	$	6,289		$	5,413		$	1,713		$	2,008

The accompanying notes are an integral part of the condensed consolidated financial statements.

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Frisch’s Restaurants, Inc. and Subsidiaries

Condensed Consolidated Balance Sheet

ASSETS

	March 4, 2014		May 28, 2013
	(unaudited)
	(in thousands)
Current Assets
Cash and equivalents	$	1,796	$	4,256
Trade and other accounts receivable	1,460		1,297
Inventories	6,403		5,765
Prepaid expenses, sundry deposits and property held for sale	923		686
Prepaid and deferred income taxes	1,716		2,417
Total current assets	12,298		14,421
Property and Equipment
Land and improvements	48,018		45,868
Buildings	76,302		74,173
Equipment and fixtures	84,782		80,735
Leasehold improvements and buildings on leased land	19,248		18,299
Capitalized leases	2,603		2,603
Construction in progress	234		417
	231,187		222,095
Less accumulated depreciation and amortization	125,563		119,950
Net property and equipment	105,624		102,145
Other Assets
Goodwill and other intangible assets	773		775
Land - deferred development	2,861		3,169
Property held for sale	4,776		5,236
Deferred income taxes	1,073		—
Other long term assets	3,681		2,966
Total other assets	13,164		12,146
Total assets	$	131,086	$	128,712

The accompanying notes are an integral part of the condensed consolidated financial statements.

5

LIABILITIES AND SHAREHOLDERS’ EQUITY

	March 4, 2014			May 28, 2013
	(unaudited)
	(in thousands, except share data)
Current Liabilities
Long-term obligations due within one year
Long-term debt	$	2,174		$	4,846
Obligations under capitalized leases	244			236
Self insurance	328			275
Accounts payable	7,955			5,879
Accrued expenses	7,555			8,025
Total current liabilities	18,256			19,261
Long-Term Obligations
Long-term debt	8,409			9,600
Obligations under capitalized leases	1,877			2,050
Self insurance	1,267			1,160
Deferred income taxes	—			253
Underfunded pension obligation	8,116			8,530
Deferred compensation and other	5,272			4,202
Total long-term obligations	24,941			25,795
Shareholders’ Equity
Capital stock
Preferred stock - authorized, 3,000,000 shares without par value; none issued	—			—
Common stock - authorized, 12,000,000 shares without par value; issued, 7,586,764 and 7,586,764 shares - stated value - $1.00	7,587			7,587
Additional contributed capital	69,436			69,408
	77,023			76,995
Accumulated other comprehensive loss	(3,896		)	(4,324		)
Retained earnings	54,143			50,925
	50,247			46,601
Less cost of treasury stock (2,487,752 and 2,524,309 shares)	39,381			39,940
Total shareholders’ equity	87,889			83,656
Total liabilities and shareholders’ equity	$	131,086		$	128,712

The accompanying notes are an integral part of the condensed consolidated financial statements.

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Frisch’s Restaurants, Inc. and Subsidiaries

Condensed Consolidated Statement of Shareholders’ Equity

40 weeks ended March 4, 2014 (Unaudited)

	Common stock at $1 per share - Shares and amount		Additional contributed capital			Accumulated other comprehensive income (loss)			Retained earnings			Treasury shares			Total
	(in thousands, except per share data)
Balance at May 28, 2013	$	7,587	$	69,408		$	(4,324	)	$	50,925		$	(39,940	)	$	83,656
Net earnings for 40 weeks	—		—			—			5,861			—			5,861
Other comprehensive income, net of tax	—		—			428			—			—			428
Stock options exercised	—		(26		)	—			—			198			172
Excess tax benefit from stock options exercised	—		24			—			—			—			24
Stock-based compensation cost	—		246			—			—			—			246
Treasury shares acquired	—		—			—			—			(105		)	(105		)
Other treasury shares re-issued	—		(180		)	—			—			466			286
Employee stock purchase plan	—		(36		)	—			—			—			(36		)
Cash dividends - $0.52 per share	—		—			—			(2,643		)	—			(2,643		)
Balance at March 4, 2014	$	7,587	$	69,436		$	(3,896	)	$	54,143		$	(39,381	)	$	87,889

The accompanying notes are an integral part of the condensed consolidated financial statements.

7

Frisch’s Restaurants, Inc. and Subsidiaries

Condensed Consolidated Statement of Cash Flows

40 weeks ended March 4, 2014 and March 5, 2013

(unaudited)

	40 weeks ended
	March 4, 2014			March 5, 2013
	(in thousands)
Cash flows provided by (used in) operating activities:
Net earnings	$	5,861		$	4,548
Less: loss from discontinued operations	—			(158		)
Earnings from continuing operations	5,861			4,706
Adjustments to reconcile net earnings to net cash from operating activities:
Depreciation and amortization	8,160			7,936
Loss on disposition of assets, including abandonment losses	21			55
Impairment of long-lived assets	—			71
Stock-based compensation expense	246			415
Net periodic pension cost	1,434			2,497
Contributions to pension plans	(1,200		)	(1,544		)
	14,522			14,136
Changes in assets and liabilities:
Trade and other receivables	(163		)	171
Inventories	(638		)	(941		)
Prepaid expenses, sundry deposits and other	(237		)	(521		)
Other assets	(88		)	2
Prepaid, accrued and deferred income taxes	(786		)	1,344
Excess tax benefit from stock options exercised	(24		)	(364		)
Accounts payable	2,076			1,131
Accrued expenses	(518		)	217
Self insured obligations	160			(343		)
Deferred compensation and other liabilities	1,070			256
	852			952
Net cash provided by continuing operations	15,374			15,088
Net cash used in discontinued operations	—			(651		)
Net cash provided by operating activities	15,374			14,437
Cash flows provided by (used in) investing activities:
Additions to property and equipment	(11,440		)	(8,055		)
Proceeds from disposition of property	559			2,482
Change in restricted cash	—			3,493
Change in other assets	(623		)	(289		)
Net cash used in investing activities	(11,504		)	(2,369		)
Cash flows provided by (used in) financing activities:
Proceeds from borrowings	3,500			—
Payment of long-term debt and capital lease obligations	(7,528		)	(5,699		)
Cash dividends paid	(2,643		)	(2,408		)
Special cash dividend paid	—			(47,963		)
Proceeds from stock options exercised	172			7,468
Excess tax benefit from stock options exercised	24			364
Treasury shares acquired	(105		)	(6,827		)
Treasury shares re-issued	286			12
Employee stock purchase plan	(36		)	33
Net cash used in financing activities	(6,330		)	(55,020		)

The accompanying notes are an integral part of the condensed consolidated financial statements.

8

	40 weeks ended
	March 4, 2014			March 5, 2013
	(in thousands)
Net decrease in cash and equivalents	(2,460		)	(42,952		)
Cash and equivalents at beginning of year	4,256			45,962
Cash and equivalents at end of quarter	$	1,796		$	3,010
Supplemental disclosures:
Interest paid	$	544		$	841
Income taxes paid	$	1,780		$	948
Lease transactions capitalized (non-cash)	$	—		$	781

The accompanying notes are an integral part of the condensed consolidated financial statements.

9

Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE A — ACCOUNTING POLICIES

Interim Financial Statements and Principles of Consolidation

The accompanying interim Condensed Consolidated Financial Statements (unaudited) include the accounts of the Company, prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures included normally in financial statements prepared in accordance with United States Generally Accepted Accounting Principles (US GAAP) have been condensed or omitted as permitted under such rules and regulations. However, management believes that the disclosures made are adequate to make the information not misleading when read in conjunction with the Consolidated Financial Statements and the notes thereto that were included in the Company's Annual Report on Form 10-K for the year ended May 28, 2013.

Significant inter-company accounts and transactions have been eliminated in consolidation. In the opinion of management, all adjustments (all of which were normal and recurring) necessary for a fair presentation of the accompanying unaudited Interim Condensed Consolidated Financial Statements have been made for all periods presented. Additionally, all of the dollar amounts referenced in the text of the footnotes are reported in thousands.

Reclassifications

Certain amounts reported in the prior year have been reclassified to conform to the current year presentation.

Fiscal Year

The current fiscal year will end on Tuesday, June 3, 2014 (Fiscal Year 2014), a period of 53 weeks (which will include a 13 week fourth quarter). The year that ended May 28, 2013 (Fiscal Year 2013) was a 52 week year. The Third Quarter of Fiscal 2014 consists of the 12 weeks ended March 4, 2014. It compares with the 12 weeks ended March 5, 2013, which constituted the Third Quarter of Fiscal 2013. The Three Quarters Ended March 4, 2014 was a period of 40 weeks. It compares with the Three Quarters Ended March 5, 2013, which was also a period of 40 weeks. The 12 week third quarter of each fiscal year should not be considered indicative of results for a full year, because it spans most of the winter season from mid-December through early March.

Rebates

Cash rebates received from vendors are recorded as a reduction of cost of sales in the periods in which they are earned. Cash received in advance of the period of recognition is recorded as a liability on the balance sheet.

Impairment of Long-Lived Assets

There were no non-cash impairment losses recorded during the Three Quarters Ended March 4, 2014.

Non-cash impairment losses from continuing operations totaling $71 were recorded during the 40 week period ended March 5, 2013 (during the First Quarter). The $71 aggregate impairment charge lowered previous estimates of the fair values of two former Frisch's Big Boy restaurants, both of which had been sold as of March 4, 2014 (in May and July 2013).

10

Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE A — ACCOUNTING POLICIES (CONTINUED)

Goodwill and Other Intangible Assets

An analysis of Goodwill and Other Intangible Assets follows:

	March 4, 2014		May 28, 2013
	(in thousands)
Goodwill	$	741	$	741
Other intangible assets not subject to amortization	22		22
Other intangible assets subject to amortization - net	10		12
Total goodwill and other intangible assets	$	773	$	775

Provision for Income Taxes

The provision for income taxes in all periods presented is based on management’s estimate of the effective tax rate for the entire year, to which the effect of certain discrete items as described below has been applied.

	40 weeks ended						12 weeks ended
Income Tax Expense (Benefit)	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
Effective tax rate (benefit)	22.5		%	30		%	(14.1		)%	26.2		%
	(in thousands)
Effective tax rate - tax expense (benefit)	$	1,537		$	2,052		$	(126	)	$	621
Discrete - valuation allowances (released) placed	(222		)	81			(222		)	—
Discrete - domestic production activities deduction	(343		)	—			(343		)	—
Total income tax expense (benefit)	$	972		$	2,133		$	(691	)	$	621

Income Taxes - Discrete Items

Management periodically assesses the realization of net deferred tax assets based on historical, current and future (expected) operating results. A valuation allowance is recorded if management believes the Company's net deferred tax assets will not be realized ultimately. In addition, all valuation allowances are monitored closely by management, which may consider releasing such allowances in the future based on any positive evidence that may become available that would indicate that the deferred tax asset may be realized ultimately.

During the 12 week period ended March 4, 2014, management developed a plan to restructure the Company's consolidated subsidiaries from corporations to single member limited liability companies. By implementing this plan, management believes future taxable income will be generated in amounts sufficient to realize certain state deferred tax assets, including certain Net Operating Loss (NOL) carryforwards. As a result, the valuation allowances that had been previously placed on these deferred tax assets were released during the 12 week period ended March 4, 2014, the effect of which was to record an income tax benefit of $222. The release of $222 includes $81 that had been placed on certain deferred state income tax assets and included in the tax provision during the Second Quarter of Fiscal 2013.

During the present fiscal year, management has undertaken a project to identify, quantify and document tax benefits associated with the Domestic Production Activities Deduction (DPAD) that are available under the Internal Revenue Code (IRC). Prior to this project, management had not elected to claim DPAD benefits. In February 2014, the Company filed an amended federal income tax return for its 2010 fiscal year to take advantage of DPAD. The expected refund totaling $343, was recorded as an income tax benefit during the 12 week period ended March 4, 2014. Amended federal income tax returns for fiscal years 2011, 2012 and 2013 will be filed in the Fourth Quarter of Fiscal 2014, which will result in the recording of additional tax benefits for DPAD, currently estimated to total between $600 and $700.

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Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE A — ACCOUNTING POLICIES (CONTINUED)

The tax benefit to be derived from DPAD in fiscal 2014 has been incorporated into the annual effective tax rate as of the 12 week period ended March 4, 2014.

Income Taxes - Repair Regulations

An automatic Change in Accounting Method (Form 3115) was filed with the Internal Revenue Service (IRS) in fiscal 2011, to allow for immediate deduction of certain repairs and maintenance costs, replacing the previous treatment that had capitalized these costs. Final Repair Regulations were issued by the IRS in September 2013 to replace temporary and proposed repair regulations that had been issued in December 2011. The temporary and proposed repair regulations had departed in some ways from the earlier regulations on which the Company's Change in Accounting Method had been based. The Final Repair Regulations are less of a departure from the earlier regulations than were the temporary and proposed regulations that had been issued in December 2011. The Final Repair Regulations, which specify when costs incurred to acquire, produce or improve tangible property must be capitalized or may be deducted as incurred, must be applied to taxable years beginning on or after January 1, 2014 (the Company's fiscal year 2015). Although still unfavorable, the effect of the Final Repair Regulations on the Company's Change in Accounting Method (filed in fiscal 2011) is expected to be an immaterial timing difference. Once the exact amount is known, (likely in the 4th quarter of fiscal 2014), the appropriate Forms 3115 will be filed with the IRS to conform the previous Change in Accounting Method to the Final Repair Regulations.

New Accounting Pronouncements

ASU 2013-02, "Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive income," was issued in February 2013 to amend Accounting Standards Codification Topic 220, "Comprehensive Income." The amendment does not change the current requirements for reporting net income or other comprehensive income in financial statements, but requires disclosure about amounts reclassified out of accumulated other comprehensive income (AOCI), by component. The amendment requires disclosure of the effect of significant reclassifications out of AOCI on the respective line items in net income in which the item was reclassified if the amount being reclassified is required to be reclassified to net income in its entirety in the same reporting period. It requires a cross reference to other disclosures that provide additional detail for amounts that are not required to be reclassified in their entirety in the same reporting period.

ASU 2013-02 is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2012. This new disclosure became effective for the Company on May 29, 2013 (the first day of Fiscal Year 2014), and has been adopted in accordance with the standard. See NOTE H - OTHER COMPREHENSIVE INCOME to the Condensed Consolidated Financial Statements for the new disclosures related to the adoption of this standard.

The Company reviewed all other significant newly issued accounting pronouncements and concluded that they are either not applicable to the Company’s business or that no material effect is expected on the financial statements as a result of future adoption.

NOTE B - DISCONTINUED OPERATIONS

As of March 4, 2014 (end of the Third Quarter Fiscal 2014) there were no assets or liabilities remaining on the Condensed Consolidated Balance Sheet that relate to the Golden Corral restaurants that were sold in May 2012 to Golden Corral Corporation. Loss from discontinued operations reported in the Condensed Consolidated Statement of Earnings for the 40 weeks ended March 5, 2013 included a charge against income tax expense of $158 representing adjustments to tax related balance sheet accounts. This charge occurred in the First Quarter Fiscal 2013; there were no charges to Discontinued Operations in any other quarter during Fiscal Year 2013.

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Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE C — LONG-TERM DEBT

Long term debt consists of the following maturities as of March 4, 2014:

	March 4, 2014		May 28, 2013
	(in thousands)
Current maturities	$	2,174	$	4,846	Current maturities
March 2016	$	1,712	$	3,652	May 2015
March 2017	4,851		2,721		May 2016
March 2018	1,335		1,654		May 2017
March 2019	511		1,235		May 2018
Subsequent to March 2019	—		338		Subsequent to May 2018
Long-term maturities	$	8,409	$	9,600	Long-term maturities
Total long-term debt	$	10,583	$	14,446	Total long-term debt

Loan Agreement

Borrowing authority under the Company's 2012 Loan Agreement expired on October 15, 2013. A new three year loan agreement was entered on October 31, 2013 (2013 Loan Agreement) with the same lender. The terms of the 2013 Loan Agreement are set forth below in the various components.

Construction Loan

The purpose of the Construction Loan is to finance the construction and opening and/or refurbishing of Frisch's Big Boy Restaurants. Consistent with the previous agreement, funds borrowed must be converted to a Term Loan within six months.

At the time the 2013 Loan Agreement was executed, the aggregate outstanding balance under the Construction Loan was $11,812, which consisted entirely of Term Loans. On October 31, 2013, the Company paid $3,835 to retire six of the Construction Term Loans, incurring minimal prepayment penalties in the process. The payment was sourced from $1,835 in cash and $2,000 that was borrowed under the Revolving Loan (see below).

As of March 4, 2014, the Company had no borrowings in the Construction Phase, and the aggregate outstanding balance of Construction Term Loans totaled $6,685 ($2,033 is included in current maturities), which is included in the above table. The remaining term loans are governed by existing Term Loan promissory notes. The outstanding Term Loans are subject to fixed interest rates, the weighted average of which is 3.87 percent. These Term Loans are being repaid in equal monthly installments of principal and interest aggregating $210, expiring at various dates ranging from November 2014 through February 2019.

Under the 2013 Loan Agreement, when funds are borrowed and in the Construction Phase, interest is based on the LIBOR Rate Margin, plus the one, two, or three month LIBOR rate, as selected by the Company. Under the 2013 Loan Agreement, $5,000 is available for construction financing through October 31, 2016. At the lender's discretion, the Company may request that the facility be increased up to $15,000 at any time. The Company is required to pay the lender an unused credit fee in an amount equal to 0.25 percent per annum on the unused Construction Loan amount.

Revolving Loan

The purpose of the Revolving Loan is to fund working capital needs and for other corporate purposes. Under the 2013 Loan Agreement, the lender's commitment was increased from $5,000 to $11,000. Interest accrues on each advance at an annual rate equal to the LIBOR Rate Margin plus the one month LIBOR rate, currently 1.50 percent. The effective interest rate from the date of inception, October 31, 2013, through March 4, 2014, was 1.51%. The effective interest rate for the 12 weeks ending March 4, 2014, was 1.51%.The Company is required to pay the lender an unused credit fee equal to 0.25 percent percent per annum on the unused Revolving Loan amount. The amount outstanding under the Revolving Loan was $3,250 as of March 4, 2014.

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Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE C — LONG-TERM DEBT (CONTINUED)

Revolving loans are ordinarily classified as short term. However, unlike the 2012 Loan Agreement, the 2013 Loan Agreement does not require a consecutive day "out-of-debt" period during each fiscal year, and any outstanding balance will not be due and payable until October 31, 2016. Management has evaluated the terms of the 2013 Loan Agreement and determined that all criteria have been satisfied in order to classify the Revolving Loan as long-term debt.

Other Components

For a description of the Stock Repurchase Loan and the 2009 Term Loan, refer to NOTE C - LONG TERM DEBT in the Notes to Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended May 28, 2013. No changes have been made to the terms or the required monthly payments of the Stock Repurchase Loan in connection with the 2013 Loan Agreement. The outstanding balance of the Stock Repurchase Loan was $648 as of March 4, 2014 ($141 is included in current maturities). The final payment on the 2009 Term Loan was made on October 21, 2013.

Loan Covenants

The 2013 Loan Agreement contains covenants relating to the relationship of Senior Bank Debt and Earnings Before Income Taxes, Depreciation and Amortization (EBITDA) and minimum required levels of EBITDA , lease expense, asset dispositions, investments and restrictions on pledging certain restaurant operating assets. The Company was in compliance with all loan covenants as of March 4, 2014. Compensating balances are not required under the terms of the 2013 Loan Agreement.

Fair Values

The fair values of the fixed rate Term Loans within the Construction Loan as shown in the following table are based on fixed rates that would have been available at March 4, 2014 if the loans could have been refinanced with terms similar to the remaining terms under the present Term Loans. The carrying value of substantially all other long-term debt approximates its fair value.

	Carrying Value		Fair Value
	(in thousands)
Term Loans under the Construction Loan	$	6,685	$	6,820

14

Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE D - ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable in the Condensed Consolidated Balance Sheet consist of the following:

	March 4, 2014		May 28, 2013
	(in thousands)
Trade and other accounts payable	$	4,728	$	3,574
Taxes - sales and use, payroll tax withheld from employees	1,469		581
Utilities	578		621
Gift cards and coupons	950		748
Miscellaneous employee withholding	230		355
Total accounts payable	$	7,955	$	5,879

Accrued expenses in the Condensed Consolidated Balance Sheet consist of the following:

	March 4, 2014		May 28, 2013
	(in thousands)
Salaries, wages and related expenses	$	4,494	$	4,513
Accrued incentive compensation and related expenses	922		1,216
Accrued property taxes	1,470		1,769
Other accrued expenses	669		527
Total accrued expenses	$	7,555	$	8,025

15

Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE E - SHAREHOLDERS' EQUITY/CAPITAL STOCK

Outstanding and Exercisable Options

The changes in outstanding and exercisable options under both the 1993 Stock Option Plan (1993 Plan) and the 2003 Stock Option and Incentive Plan (2003 Plan) are shown below as of March 4, 2014:

	No. of shares		Weighted avg. price per share		Weighted avg. Remaining Contractual Term		Aggregate Intrinsic Value (in thousands)
Outstanding at beginning of year	72,503		$	18.07
Granted	—		$	—
Exercised	(12,502	)	$	13.84
Forfeited or expired	(3,500	)	$	22.56
Outstanding at end of quarter	56,501		$	18.73	3.29	years	$	338
Exercisable at end of quarter	56,501		$	18.73	3.29	years	$	338

The intrinsic value of stock options exercised during the 40 week periods ended March 4, 2014 and March 5, 2013 amounted to $127 and $2,779, respectively. The intrinsic value of stock options exercised during the 12 week period ended March 4, 2014 amounted to $68. No stock options were exercised during the 12 week period ended March 5, 2013.

Dividends

Regular quarterly cash dividends paid to shareholders during the 40 week period ended March 4, 2014 amounted to $2,643 or $0.52 per share. In addition, an $0.18 per share dividend was declared on March 13, 2014. Its payment of approximately $918 on April 10, 2014 (not included in accounts payable at March 4, 2014) will be the 213th consecutive quarterly cash dividend (a period of 53 years) paid by the Company.

Earnings Per Share

Basic earnings per share (EPS) calculations are based on the weighted average number of outstanding common shares during the period presented. Diluted EPS includes the effect of common stock equivalents, which assumes the exercise and conversion of dilutive stock options.

	Used to Calculate Basic EPS	Stock equivalents	Used to Calculate Diluted EPS
40 weeks ended:	Weighted average shares outstanding		Weighted average shares outstanding
March 4, 2014	5,083,516	13,777	5,097,293
March 5, 2013	5,021,517	17,832	5,039,349
12 weeks ended:
March 4, 2014	5,094,567	16,659	5,111,226
March 5, 2013	5,062,455	10,092	5,072,547

Excluded from the calculations above (because the effect was anti-dilutive), were stock options to purchase 6,834 shares during the 40 week period ended March 4, 2014 and 8,000 during the 40 week period ended March 5, 2013. Stock options to purchase 6,834 shares during the 12 week period ended March 4, 2014 and 36,000 in the 12 weeks ended March 5, 2013 were also excluded from the calculations above because the effect was anti-dilutive.

16

Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE E - SHAREHOLDERS' EQUITY/CAPITAL STOCK (CONTINUED)

Share-Based Payment (Compensation Cost)

The fair value of restricted stock issued (one year vesting) and stock options granted (three year vesting) is recognized as compensation cost on a straight-line basis over the vesting periods of the awards. The fair value of unrestricted stock awarded under the 2003 Plan was recognized entirely during the period granted ($127 in June 2012 - 4,850 shares). Compensation costs arising from all share-based payments are charged to administrative and advertising expense in the Condensed Consolidated Statement of Earnings.

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands, except earnings per share)
Stock options granted	$	—		$	42		$	—		$	14
Restricted stock issued	246			246			74			74
Unrestricted stock issued	—			127			—			—
Share-based compensation cost, pretax	246			415			74			88
Tax benefit	(84		)	(141		)	(25		)	(30		)
Share-based compensation cost, net of tax	$	162		$	274		$	49		$	58
Effect on basic earnings per share	$	0.03		$	0.05		$	0.01		$	0.01
Effect on diluted earnings per share	$	0.03		$	0.05		$	0.01		$	0.01

There was no unrecognized pretax compensation cost related to non-vested stock options as of March 4, 2014. Unrecognized pretax compensation cost related to restricted stock awards amounted to $197 as of March 4, 2014, which is expected to be recognized over a weighted average period of 0.62 years.

Unrestricted stock awarded under the 2012 Stock Option and Incentive Plan ($244 in June 2013 - 13,450 shares) was accrued as incentive compensation in Fiscal Year 2013, including $101 and $30 respectively, during the 40 and 12 week period ended March 5, 2013. Incentive compensation for unrestricted stock is also being accrued in Fiscal Year 2014 - $173 through the 40 week period ended March 4, 2014 and $52 during the 12 week period ended March 4, 2014.

Compensation cost is also recognized in connection with the Company’s Employee Stock Purchase Plan. Compensation costs related to the Employee Stock Purchase Plan are determined at the end of each semi-annual offering period: October 31 and April 30, which amounted to $20 and $122 respectively, at October 31, 2013 (40 week period ended March 4, 2014) and October 31, 2012 (40 week period ended March 5, 2013).

17

Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE F - PENSION PLANS

The Company sponsors a qualified defined benefit pension plan (DB Plan) plus an unfunded non-qualified Supplemental Executive Retirement Plan (SERP) for “highly compensated employees” (HCE’s). Net periodic pension cost for the retirement plans is shown in the table that follows:

	40 weeks ended						12 weeks ended
Net periodic pension cost components	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands)
Service cost	$	1,248		$	1,387		$	374		$	416
Interest cost	1,397			1,334			419			400
Expected return on plan assets	(1,859		)	(1,535		)	(558		)	(460		)
Amortization of prior service (credit) cost	(6		)	(6		)	(2		)	(2		)
Recognized net actuarial loss	654			1,317			196			395
Net periodic pension cost	$	1,434		$	2,497		$	429		$	749
Weighted average discount rate	4.40		%	4.25		%	4.40		%	4.25		%
Weighted average rate of compensation increase	4.00		%	4.00		%	4.00		%	4.00		%
Weighted average expected long-term rate of return on plan assets	7.25		%	7.50		%	7.25		%	7.50		%

Net periodic pension cost for Fiscal Year 2014 is currently expected to approximate $1,864. Net periodic pension cost for Fiscal Year 2013 was $3,247. The primary driver of the 42 percent decrease over Fiscal Year 2013 is the actual return on Plan assets during Fiscal Year 2013, which exceeded the expected return on Plan assets by $4,296. The higher discount rate and data updates also contributed to the decrease, but to a lesser degree.

Although there are no minimum required contributions to the DB Plan for the plan year ending May 31, 2014, management currently anticipates contributing up to $2,000 over the course of Fiscal Year 2014, including $1,200 that was contributed during 40 weeks ended March 4, 2014.

Frisch's Executive Savings Plan

Fair value measurements are used for recording the assets in the Frisch's Executive Savings Plan (FESP). FESP assets are the principal component of "Other long-term assets" in the Condensed Consolidated Balance Sheet. Assets of the plan are grouped into a three-level hierarchy for valuation techniques used to measure the fair values of the assets. These levels are:

• Level 1 - Quoted prices in active markets for identical assets.

• Level 2- Observable inputs other than Level 1 prices, such as quoted prices for similar assets, quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data by correlation or other means.

• Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets.

18

Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE F - PENSION PLANS (CONTINUED)

The fair values of all FESP assets are determined based on quoted market prices and are classified within Level 1 of the fair value hierarchy:

	March 4, 2014		May 28, 2013
	(in thousands)
	Level 1		Level 1
Money market funds	$	432	$	45
Mutual funds	1,771		1,310
Foreign equity mutual funds	242		287
Taxable bond mutual funds	534		798
Large blend target date mutual funds	497		414
Total	$	3,476	$	2,854

19

Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE G — LITIGATION AND CONTINGENCIES

Litigation

Employees, customers and other parties bring various claims and lawsuits against the Company from time to time in the ordinary course of business. Claims made by employees are subject to workers' compensation insurance or are covered generally by employment practices liability insurance. Claims made by customers are covered by general and product liability insurance. All insurance policies are subject to retention and coverage limits. Exposure to loss contingencies from pending or threatened litigation is evaluated continually by management, which believes at the present time that the resolution of claims currently outstanding, whether or not covered by insurance, will not result in a material adverse effect upon the Company's earnings, cash flows or financial position. Adequate provisions for expected losses not covered by insurance have been included in the Condensed Consolidated Financial Statements.

Contingent Liabilities

The Company remains contingently liable under certain ground lease agreements relating to land on which seven of the Company's former Golden Corral restaurants are situated. The seven leases were assigned to Golden Corral Corporation (GCC) as part of the May 2012 transaction to sell the restaurants to GCC. The amount remaining under contingent lease obligations totaled approximately$6,436 as of March 4, 2014, for which the aggregate average annual lease payments approximate $665 in each of the next five years. Since there is no reason to believe that GCC (the owner and franchisor of the Golden Corral brand) is likely to default, no provision has been made in the Condensed Consolidated Financial Statements for amounts that would be payable by the Company.

20

Frisch’s Restaurants, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Third Quarter Fiscal 2014, Ended March 4, 2014

NOTE H — OTHER COMPREHENSIVE INCOME

The following table summarizes items reclassified out of accumulated other comprehensive income and the related tax effects for the components of net periodic pension cost:

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands)
Amortization of pretax amounts included in net periodic pension expense (1)
Included in Cost of Sales	$	611		$	1,247		$	183		$	375
Included in Administrative and Advertising Expense	37			64			11			19
Total reclassification (pretax) (1)	648			1,311			194			394
Tax benefit	(220		)	(446		)	(66		)	(134		)
Total reclassification (net of tax)	$	428		$	865		$	128		$	260

(1) These amounts are included in the computation of net periodic pension expense as a net of the two components (See NOTE F - PENSION PLANS) as shown below:

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands)
Amortization of prior service (credit) cost	$	(6	)	$	(6	)	$	(2	)	$	(2	)
Recognized net actuarial loss	654			1,317			196			396
Total reclassification (pretax)	$	648		$	1,311		$	194		$	394

The following table summarizes changes in accumulated other comprehensive loss (all of which is from Company sponsored pension plans), net of tax, for the 40 week period ended March 4, 2014:

Accumulated Other Comprehensive Loss	March 4, 2014
	(in thousands)
Balance in Accumulated Other Comprehensive Loss on May 28, 2013	$	4,324
Amount reclassified from accumulated other comprehensive income	(428		)
Net other comprehensive (income) loss	(428		)
Balance in Accumulated Other Comprehensive Loss on March 4, 2014	$	3,896

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ITEM 2. MANAGEMENT’S DISCUSSION and ANALYSIS of FINANCIAL CONDITION and RESULTS of OPERATIONS

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Forward-looking statements are contained in this Quarterly Report on Form 10-Q, including this Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A). Such statements may generally express management’s expectations with respect to its plans, or its assumptions and beliefs concerning future developments and their potential effect on the Company. There can be no assurances that such expectations will be met or that future developments will not conflict with management’s current beliefs and assumptions, which are inherently subject to risks and the development of other uncertainties. Factors that could cause actual results and performance to differ materially from anticipated results that may be expressed or implied in forward-looking statements are included in, but not limited to, the discussion in "Risk Factors" that may be found in this Form 10-Q under Part II, Item 1A. and as set forth in Part I, Item 1A. of the Company's Annual Report on Form 10-K for the fiscal year ended May 28, 2013.

Sentences that contain words such as “should,” “would,” “could,” “may,” “plan(s),” “anticipate(s),” “project(s),” “believe(s),” “will,” “expect(s),” “estimate(s),” “intend(s),” “continue(s),” “assumption(s),” “goal(s),” “target(s)” and similar words (or derivatives thereof) are generally used to distinguish “forward-looking statements” from historical or present facts.

All forward-looking information in this MD&A is provided by the Company pursuant to the safe harbor established under the Private Securities Litigation Reform Act of 1995 and should be evaluated in the context of all risk factors. Except as may be required by law, the Company disclaims any obligation to update any of the forward-looking statements that may be contained in this MD&A.

OVERVIEW

(all dollars reported in the text of this MD&A are in thousands)

This MD&A should be read in conjunction with the interim Condensed Consolidated Financial Statements (unaudited) found in this Form 10-Q under Part I, Item 1, and the audited Consolidated Financial Statements included in the Company's Form 10-K for the fiscal year ended May 28, 2013.

The Company has no off-balance sheet arrangements other than operating leases that are entered from time to time in the ordinary course of business. The Company does not use special purpose entities.

Frisch’s Restaurants, Inc. and Subsidiaries (Company) is a regional company that operates full service family-style restaurants under the name "Frisch's Big Boy." As of March 4, 2014, 96 Frisch's Big Boy restaurants were owned and operated by the Company, located in various regions of Ohio, Kentucky and Indiana. The Company also licenses 25 Frisch's Big Boy restaurants to other operators who pay franchise and other fees to the Company.

The Company’s Third Quarter of Fiscal 2014 consists of the 12 weeks ended March 4, 2014, and compares with the 12 weeks ended March 5, 2013, which constituted the Third Quarter of Fiscal 2013. The First Three Quarters of Fiscal 2014 consists of the 40 week period that ended March 4, 2014, and compares with the 40 week period that ended March 5, 2013, which constituted the First Three Quarters of Fiscal 2013. The third quarter of each fiscal year is usually a disproportionately smaller share (than other quarters) of annual revenue and net earnings because it spans most of the winter season from mid December to early March.

References to Fiscal Year 2014 refer to the 53 week year that will end on June 3, 2014 (the fourth quarter will have 13 weeks). References to Fiscal Year 2013 refer to the 52 week year that ended May 28, 2013.

The following table recaps the Company's earnings or loss components:

22

	Third Quarter - 12 Weeks					First Three Quarters - 40 Weeks
	2014			2013		2014		2013
	(in thousands, except per share data)					(in thousands, except per share data)
Earnings from continuing operations before income taxes	$	894		$	2,369	$	6,833	$	6,839
Income tax expense (benefit) from continuing operations	$	(691	)	$	621	$	972	$	2,133
Earnings from continuing operations	$	1,585		$	1,748	$	5,861	$	4,706
Diluted EPS from continuing operations	$	0.31		$	0.34	$	1.15	$	0.93
(Loss) from discontinued operations, net of tax	$	—		$	—	$	—	$	(158	)
Diluted EPS from discontinued operations	$	—		$	—	$	—	$	(0.03	)
Net earnings	$	1,585		$	1,748	$	5,861	$	4,548
Diluted net EPS	$	0.31		$	0.34	$	1.15	$	0.90
Weighted average diluted shares outstanding	5,111			5,073		5,097		5,039

Factors having a notable effect on earnings from continuing operations before income taxes when comparing the Third Quarter of Fiscal 2014 with the Third Quarter of Fiscal 2013:

• Consolidated sales were $45,161 in the Third Quarter of Fiscal 2014 versus $45,772 in the Third Quarter of Fiscal 2013. Same store sales declined by 3.6 percent as customer counts slid during the months of January and February 2014 amid an unrelenting pattern of severe winter weather. The effect of the same store sales decline was mitigated with sales generated by two new Frisch's Big Boy restaurants that opened in March 2013 and December 2013.

• Gross profit fell to $3,567 in the Third Quarter of Fiscal 2014, down 28.2 percent from $4,967 in the Third Quarter of Fiscal 2013. As a percentage of sales, gross profit was 7.9 percent in the Third Quarter of Fiscal 2014 versus 10.9 percent in the Third Quarter of Fiscal 2013:

- Food and Paper Costs were 33.6 percent in the Third Quarter of Fiscal 2014 and 33.7 percent in the Third Quarter of Fiscal 2013.

- Payroll and Related Costs rose to 36.9 percent in the Third Quarter of Fiscal 2014, up from 35.6 percent in the Third Quarter of Fiscal 2013.

- Other Operating Costs rose to 21.6 percent in the Third Quarter of Fiscal 2014, up from 19.9 percent in the Third Quarter of Fiscal 2013.

• Pension expense was $429 in the Third Quarter of Fiscal 2014 versus $749 in the Third Quarter of Fiscal 2013. The savings from lower pension costs was neutralized by higher medical insurance costs.

• Administrative and advertising expense was $2,846 in the Third Quarter of Fiscal 2014 versus $2,695 in the Third Quarter of Fiscal 2013.

• Interest expense was $120 in the Third Quarter of Fiscal 2014 versus $209 in the Third Quarter of Fiscal 2013.

Factors having a notable effect on earnings from continuing operations before income taxes when comparing the First Three Quarters of Fiscal 2014 with the First Three Quarters of Fiscal 2013:

• Consolidated restaurant sales were $155,614 in the First Three Quarters of Fiscal 2014 versus $154,920 in the First Three Quarters of Fiscal 2013. Same store sales declined by 1.4 percent. The effect of the same store sales decline was mitigated with sales generated by three new Frisch's Big Boy restaurants that opened in August 2012, March 2013 and December 2013.

• Gross profit fell to $15,604 in the First Three Quarters of Fiscal 2014, down 6.8 percent from $16,735 in the First Three Quarters of Fiscal 2013. As a percentage of sales, gross profit was 10.0 percent in the First Three Quarters of Fiscal 2014 versus 10.8 percent in the First Three Quarters of Fiscal 2013:

- Food and Paper Costs were 33.3 percent in the First Three Quarters of Fiscal 2014, down from 33.5 percent in the First Three quarters of Fiscal 2013.

23

- Payroll and Related Costs were 35.6 percent in the First Three Quarters of Fiscal 2014, up from 35.1 percent in the First Three Quarters of Fiscal 2013.

- Other Operating Costs were 21.0 percent in the First Three Quarters of Fiscal 2014, up from 20.6 percent in the First Three Quarters of Fiscal 2013.

• Pension expense was $1,434 in the First Three Quarters of Fiscal 2014 versus $2,497 in the First Three Quarters of Fiscal 2013. The savings from lower pension costs is expected to continue to be neutralized by higher medical insurance costs for the remainder of the year.

• Administrative and advertising expense was $9,443 in the First Three Quarters of Fiscal 2014 versus $10,109 in the First Three Quarters of Fiscal 2013.

• Interest expense was $471 in the First Three Quarters of Fiscal 2014 versus $759 in the First Three quarters of Fiscal 2013.

Income tax expense is summarized in the next table. The primary drivers of tax benefits shown in the table are associated with the federal Domestic Production Activities Deduction and the release of certain valuation allowances that had been placed previously on certain deferred state tax assets.

	Third Quarter - 12 Weeks						First Three Quarters - 40 Weeks
	2014			2013			2014			2013
Effective tax rate (benefit)	(14.1		)%	26.2		%	22.5		%	30		%
	(in thousands)						(in thousands)
Effective tax rate - tax expense (benefit)	$	(126	)	$	621		$	1,537		$	2,052
Discrete - valuation allowances (released) placed	(222		)	—			(222		)	81
Discrete - domestic production activities deduction	(343		)	—			(343		)	—
Total income tax expense (benefit)	$	(691	)	$	621		$	972		$	2,133

The loss from discontinued operations reported in the First Three Quarters of Fiscal 2013 represents adjustments to tax related balance sheet accounts associated with the Company's former Golden Corral operations.

RESULTS of OPERATIONS

Sales

The Company’s sales are generated primarily through the operation of Frisch's Big Boy restaurants. Sales also include wholesale sales from the Company’s commissary to Frisch's Big Boy restaurants that are licensed to other operators and the sale of Frisch's signature brand tartar sauce to grocery stores. Same store sales comparisons are a key metric that management uses in the operation of the business. Same store sales are affected by changes in customer counts and menu price increases. Changes in sales also occur as new restaurants are opened and older restaurants are closed. Below is the detail of consolidated restaurant sales:

	Third Quarter - 12 Weeks				First Three Quarters - 40 Weeks
	2014		2013		2014		2013
	(in thousands)				(in thousands)
Frisch's Big Boy restaurants operated by the Company	$	42,652	$	43,136	$	147,141	$	146,640
Wholesale sales to licensees	2,063		2,104		7,380		7,214
Wholesale sales to groceries	446		532		1,093		1,066
Total sales	$	45,161	$	45,772	$	155,614	$	154,920

24

Frisch's Big Boy restaurant sales shown in the above table are reflective of a same store sales decrease of 3.6 percent in the Third Quarter of Fiscal 2014 (on a customer count decrease of 5.9 percent) and a decrease of 1.4 percent in the First Three Quarters of Fiscal 2014 (on a 3.8 percent decrease in customer counts).

Most of the decrease in customer counts is attributable to severe winter weather conditions that persisted over much of the course of the Third Quarter of Fiscal 2014 throughout all regions in which the Company operates restaurants. The same store sales comparison includes the effect of three menu price increases, implemented respectively in September 2012 (0.9 percent), February 2013 (1.1 percent) and September 2013 (1.1 percent). Another menu price increase (1.5 percent) went into effect on the first day of the upcoming fourth quarter of fiscal 2014.

The Company operated 96 Frisch's Big Boy restaurants as of March 4, 2014. The count of 96 includes the following changes since the beginning of Fiscal Year 2013 (June 2012), when 93 Frisch's Big Boy restaurants were in operation:

• August 2012 - opened new restaurant near Cincinnati, Ohio

• March 2013 - opened new restaurant in Sidney, Ohio (Dayton, Ohio market)

• December 2013 - opened new restaurant in Lexington, Kentucky

No other new Frisch's Big Boy restaurants are expected to be added to the Company's operations in Fiscal Year 2014. (One franchised Frisch's Big Boy restaurant is currently under construction, scheduled to open in June 2014.)

The U.S. Food and Drug Administration (FDA) missed its February 2014 deadline for issuing the final regulations of the menu labeling provisions of the federal Patient Protection and Affordable Care Act (ACA), which was enacted in March 2010. On April 3, 2014, the FDA announced that it had moved the final regulation to the White House Office of Management and Budget (OMB), which is the final step in the review process. Once the review by OMB is completed, which is expected to take one to two months, the final regulation will be published and made publicly available. Nutritional information will not be required to appear on the Company's menus for at least six months and possibly up to one year after the the final rule is published. Sales volumes could be adversely affected if customers should make significant changes to their dining choices once the information is placed on menus. Nutritional information is now available on the Company's website.

Gross Profit

The determination of gross profit is shown with operating percentages in the following table. The table is intended to supplement the cost of sales discussion that follows. Cost of sales is comprised of food and paper costs, payroll and related costs, and other operating costs.

	Third Quarter - 12 Weeks		First Three Quarters - 40 Weeks
	2014	2013	2014	2013
Sales	100.0%	100.0%	100.0%	100.0%
Food and Paper	33.6%	33.7%	33.3%	33.5%
Payroll and Related	36.9%	35.6%	35.6%	35.1%
Other Operating Costs	21.6%	19.9%	21.0%	20.6%
Gross Profit	7.9%	10.9%	10.0%	10.8%

Although the cost of food remains at all time highs, especially proteins - beef, pork and chicken - favorable weather conditions during the summer of 2013 produced a record corn crop which caused grain prices to fall well below year ago levels, pushing some commodity prices lower. Higher grain prices last year were largely due to drought conditions in the nation's corn belt during the summer of 2012. The ongoing drought in California is expected to push prices for produce much higher over the coming months. Tight supplies in beef markets are expected to push beef prices to record highs during the spring of 2014. Although commodity prices can be difficult to predict, some industry forecasts indicate record high beef prices will continue for the next two to three years. The continuation of semi-annual menu price increases helps keep the percentages for Food and Paper costs at manageable levels.

Although the Company does not use financial instruments as a hedge against changes in commodity prices, purchase contracts for some commodities may contain provisions that limit the price the Company will pay. These contracts are normally for periods of one year or less, but may have longer terms. For example, an agreement was reached with Pepsico Sales, Inc., effective November 1, 2013, which allows the Company to purchase Pepsi and Dole beverage products at favorable long-term pricing.

25

Food safety poses a major risk to the Company. Management rigorously emphasizes and enforces established food safety policies in all of the Company’s restaurants and in its commissary and food manufacturing plant. These policies are designed to work cooperatively with programs established by health agencies at all levels of governmental authority, including the federal Hazard Analysis of Critical Control Points (HACCP) program. In addition, the Company makes use of ServSafe Training, a nationally recognized program developed by the National Restaurant Association. The ServSafe program provides accurate, up-to-date science-based information to all levels of restaurant workers on all aspects of food handling, from receiving and storing to preparing and serving. All restaurant managers are required to be certified in ServSafe Training and are required to be re-certified every five years.

Higher payroll and related costs (as a percentage of sales) as shown in the above table are due to several components. Factors contributing to the increased percentages are higher restaurant management payroll over the course of the fiscal year and, since January 1, 2014, much higher costs for employee medical insurance. Factors offsetting the higher percentages include reductions in scheduled labor hours to mitigate the effect of higher hourly pay rates for restaurant workers, together with lower pension costs and the effect of higher menu prices charged to customers.

The Company has always offered affordable medical insurance coverage to its full time employees. In response to the individual mandate of the ACA, a sizable number of additional employees (over previous years) elected to be covered by the Company's medical insurance coverage for the 2014 calendar year. Beginning January 1, 2014, the response from this group of employees has added approximately $30 per week to the Company's medical insurance costs.

Payroll and related costs continue to be affected adversely by mandated increases in the minimum wage. On January 1, 2014, the Ohio minimum wage for tipped employees increased from $3.93 per hour to $3.98 per hour and from $7.85 per hour to $7.95 per hour for non-tipped employees. The mandate will increase Ohio payroll annually by approximately $180, which will likely be mitigated with further reductions in scheduled labor hours.

Pressure is mounting in Washington, DC to raise the federal minimum wage from $2.13 per hour for tipped employees to $7.07 per hour and from $7.25 per hour for non-tipped employees to $10.10 per hour. If the legislation is ultimately enacted, the rates will be increased gradually over a three year period, followed by automatic increases each year indexed to inflation. Management will analyze and evaluate the effect of the legislation on the Company's operations if and when enactment of such legislation appears likely.

On March 13, 2014, an executive order was issued by President Obama that directs the Secretary of Labor to revamp regulations to expand the number of workers entitled to receive overtime compensation. Management will watch the development of the regulations closely and will analyze and evaluate the effect upon the Company's practices once the specifics of the anticipated regulations are known.

Net periodic pension cost was $429 and $749 respectively, in the Third Quarter of Fiscal 2014 and the Third Quarter of Fiscal 2013. Net periodic pension cost was $1,434 and $2,497 respectively, in the First Three Quarters of Fiscal 2014 and the First Three Quarters of Fiscal 2013. Net periodic pension cost for Fiscal Year 2014 is currently expected to be in the range of $1,850 to $1,900. Net periodic pension cost for Fiscal Year 2013 was $3,247. The decrease in net periodic pension costs for Fiscal Year 2014 is due primarily to an exceptional return on plan assets during Fiscal Year 2013, which exceeded the expected return by $4,296. A higher discount rate and certain demographic updates have also contributed to the decrease, but to a lesser degree.

Other operating costs include occupancy costs such as maintenance, rent, depreciation, abandonment losses, property tax, insurance and utilities, plus costs relating to field supervision, accounting and payroll preparation costs, new restaurant opening costs and many other restaurant operating costs. Most expenses charged to other operating costs tend to be fixed in nature; the percentages shown in the above table can be greatly affected by changes in same store sales levels. In other words, percentages will generally rise when sales decrease (percentages will generally decrease when sales increase). The increase of 1.7 percentage points shown in the third quarter comparison in the table is due primarily to a decline in customer counts, which was brought about by harsh winter weather conditions as described above in the discussion of sales. Lower opening costs kept the percentage point increase to a minimum: opening costs were $119 in the Third Quarter of Fiscal 2014 and $307 in the First Three Quarters of 2014, which compared with $183 in the Third Quarter of Fiscal 2013 and $461 in the First Three Quarters of Fiscal 2013.

Operating Profit

To arrive at the measure of operating profit, administrative and advertising expense is subtracted from gross profit, while the line item for franchise fees and other revenue is added to it. Gains and losses from the sale of real property (if any) are then respectively added or subtracted. Charges for impairment of assets (if any) are also subtracted from gross profit to arrive at the measure of operating profit.

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Administrative and advertising expense increased $151 in the Third Quarter of Fiscal 2014 and decreased $666 in the First Three Quarters of Fiscal 2014 when compared against the comparable periods a year ago. The Third Quarter of Fiscal 2014 includes higher costs for professional services, which includes certain consulting on tax matters. The Third Quarter of Fiscal 2014 and First Three Quarters of Fiscal 2014 have lower accruals associated with the Company's Non Deferred Cash Balance Plan when compared against comparable year ago periods. The First Three Quarters of Fiscal 2013 (all in the First Quarter of Fiscal 2013) included charges for the cost of employee separations. Stock based compensation expense included in administrative and advertising expense was lower in the Third Quarter of Fiscal 2014 and First Three Quarters of Fiscal 2014 when compared against comparable year ago periods (see the table and discussion of stock based compensation expenses in the Financing Activities section of Liquidity and Capital Resources that appears elsewhere in this MD&A).

Revenue from franchise fees is based upon sales volumes generated by Frisch's Big Boy restaurants that are licensed to other operators. The fees are based principally on percentages of sales and are recorded on the accrual method as earned. As of March 4, 2014, 25 Frisch's Big Boy restaurants were licensed to other operators and paying franchise fees to the Company. No licensed Frisch's Big Boy restaurants opened or closed during any of the periods presented in this MD&A. One new license for a franchised Frisch's Big Boy restaurant was granted in November 2013 to an operator in southeastern Ohio. The restaurant facility is currently under construction and is expected to open in June 2014. An initial franchise fee of $30 was recorded in franchise fee revenue during the Second Quarter of Fiscal 2014.

Other revenue also includes certain other fees earned from Frisch's Big Boy restaurants that are licensed to others along with minor amounts of rent and investment income.

Gains and losses from the sale of assets consist of transactions involving real property and sometimes may include restaurant equipment that is sold together with real property as a package when closed restaurants are sold. Gains and losses reported on this line do not include abandonment losses that routinely arise when certain equipment is replaced before it reaches the end of its expected life; abandonment losses are instead reported in other operating costs.

A gain of $67 during the First Three Quarters of Fiscal 2014 (all of which was recorded during the First Quarter of Fiscal 2014) resulted primarily from the September 2013 sale of certain excess real estate, as offset by a small loss on the July 2013 sale of a former Frisch's Big restaurant. The loss of $14 incurred during the First Three Quarters of Fiscal 2013 was from the August 2012 (First Quarter of Fiscal 2013) sale of one of the remaining Golden Corral restaurants that had been closed in August 2011, and the October 2012 (Second Quarter of Fiscal 2013) sale of a former Frisch's Big Boy restaurant.

There were no charges recorded for non-cash impairment of long-lived assets in the First Three Quarters of Fiscal 2014. Non-cash impairment charges totaling $71 were recorded during the First Three Quarters of Fiscal 2013 (all of which was recorded during the First Quarter of Fiscal 2013) to lower previous estimates of the fair values of two former Frisch's Big Boy restaurants, both of which were subsequently sold (May 2013 and July 2013).

Interest Expense

Interest expense decreased $89 and $288 respectively, and in the Third Quarter of Fiscal 2014 and the First Three Quarters of Fiscal 2014 when compared with comparable periods a year ago. The decreases are primarily the result of lower debt levels than a year ago.

Income Tax Expense

The provision for income taxes in all periods presented in the consolidated statement of earnings is based on management’s estimate of the effective tax rate for the entire year, to which the effect of certain discrete items as described below has been applied.

	Third Quarter - 12 Weeks					First Three Quarters - 40 Weeks
Income Tax Expense (Benefit)	2014			2013		2014			2013
	(in thousands)					(in thousands)
Effective tax rate - tax expense (benefit)	$	(126	)	$	621	$	1,537		$	2,052
Discrete - valuation allowances (released) placed	(222		)	—		(222		)	81
Discrete - domestic production activities deduction	(343		)	—		(343		)	—
Total income tax expense (benefit)	$	(691	)	$	621	$	972		$	2,133

The effective tax rate on earnings from continuing operations was estimated at 22.5 percent and 30 percent, respectively, for the 40 week periods ended March 4, 2014 and March 5, 2013, which were lowered from 28 percent and 33.8 percent, respectively,

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at the ends of the 28 week periods ended December 10, 2013 and December 11, 2012. These reductions resulted in effective tax rates of (14.1) percent and 26.2 percent, respectively for the 12 week periods ended March 4, 2014 and March 5, 2013. The lowering of the estimated annual effective tax rate for Fiscal Year 2014 to 22.5 percent includes the effect of an anticipated deduction associated with domestic production activities (see further discussion below).

During the Third Quarter of Fiscal 2014, management developed a plan to restructure the Company's consolidated subsidiaries from corporations to single member limited liability companies. By implementing this plan, management believes future taxable income will be generated in amounts sufficient to realize certain state deferred tax assets. As a result, valuation allowances that had been previously placed on certain deferred state income tax assets were released during the 12 week period ended March 4, 2014, the effect of which was to record an income tax benefit of $222. The release of $222 includes $81 that was placed on certain deferred state income tax assets and included in the tax provision during the Second Quarter of Fiscal 2013.

During the First Three Quarters of Fiscal 2014, management has undertaken a project to identify, quantify and document tax benefits associated with the Domestic Production Activities Deduction (DPAD) that are available under the Internal Revenue Code (IRC). Prior to this project, management had not elected to claim DPAD tax benefits on the original filings of the Company's federal income tax returns for fiscal years 2010 (filed February 2011), 2011 (filed February 2012), 2012 (filed February 2013), and 2013 (filed February 2014). In February 2014, the Company filed an amended federal income tax return for its 2010 fiscal year to take advantage of the DPAD. The expected refund amounts to $343, which was recorded as an income tax benefit during the Third Quarter of Fiscal 2014. Amended federal income tax returns for fiscal years 2011, 2012 and 2013 will be filed in the Fourth Quarter of Fiscal 2014, which will result in recording of additional tax benefits for DPAD currently estimated to total between $600 and $700. As described above, the tax benefit to be derived from DPAD activities in fiscal 2014 has been incorporated into the annual effective tax rate in the Third Quarter of Fiscal 2014.

An automatic Change in Accounting Method (Form 3115) was filed with the Internal Revenue Service (IRS) in fiscal 2011, to allow for immediate deduction of certain repairs and maintenance costs, replacing the previous treatment that had capitalized these costs. Final Repair Regulations were issued by the IRS in September 2013 to replace temporary and proposed repair regulations that had been issued in December 2011. The temporary and proposed repair regulations had departed significantly from the earlier regulations on which the Company's Change in Accounting Method had been based. The Final Repair Regulations are less of a departure from the earlier regulations than were the temporary and proposed regulations that had been issued in December 2011. The Final Repair Regulations, which specify when costs incurred to acquire, produce or improve tangible property must be capitalized or may be deducted as incurred, must be applied to taxable years beginning on or after January 1, 2014 (the Company's fiscal year 2015). The effect of the Final Repair Regulations on the Company's Change in Accounting Method (filed in fiscal 2011) is expected to be an unfavorable, immaterial timing difference. (See further discussion found below in Liquidity and Capital Resources.)

The loss from discontinued operations reported in the First Three Quarters of Fiscal 2013 represents adjustments to tax related balance sheet accounts associated with the Company's former Golden Corral operations.

The examination by the Internal Revenue Service of the Company's federal tax return for Fiscal Year 2011, which was filed in February 2012, was concluded officially in November 2013. The audit resulted in no changes from the original tax return.

LIQUIDITY and CAPITAL RESOURCES

Sources of Funds

Food sales to restaurant customers provide the Company’s principal source of cash. The funds from sales are immediately available for the Company’s use, as substantially all sales to restaurant customers are received in currency or are settled by debit or credit cards. The primary source of cash provided by operating activities is net earnings plus depreciation and impairment of assets, if any. Other sources of cash may include borrowing against credit lines, proceeds received when stock options are exercised and occasional sales of real estate. In addition to servicing debt, these cash flows are utilized for discretionary objectives, including capital projects (principally restaurant expansion and remodeling costs), capital stock repurchases and dividends.

Working Capital Practices

The Company has historically maintained a strategic negative working capital position, which is a common practice in the restaurant industry. As significant cash flows are provided consistently by operations, this practice should not hinder the Company’s ability to satisfactorily retire any of its obligations when due.

The working capital deficit was $5,958 as of March 4, 2014, which is an increase of $1,118 from May 28, 2013 when the deficit was $4,840. Most of the increase in the deficit is due to higher levels of accounts payable and lower cash on hand, offset by a reduction in the current maturities of long-term debt.

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In the ordinary course of business, purchase commitments are entered into with certain of the Company's suppliers. Most of these contracts are typically for periods of one year or less in duration. However, longer term agreements are sometimes entered in order to secure favorable long-term pricing. An agreement with Pepsico Sales, Inc. was reached effective November 1, 2013, whereby Pepsi and Dole beverage products have been placed in all Frisch's Big Boy restaurants. This purchase commitment is considered to be in the ordinary course of business and replaces a similar contract with the previous beverage vendor. The term of the contract is specified by the longer of seven years or an agreed upon number of gallons.

Borrowing authority under the Company's 2012 Loan Agreement expired on October 15, 2013. A new three year loan agreement was entered on October 31, 2013 (2013 Loan Agreement) with the same lender. Under the 2013 Loan Agreement:

• The terms and conditions of all outstanding Construction Term Loans remained intact.

• The lender's commitment under the Revolving Credit Facility was increased from $5,000 to $11,000, which is available through October 31, 2016.

• The lender's commitment under the Construction Credit Facility was lowered from $15,000 to $5,000, which is available for construction financing through October 31, 2016.

• At the lender's discretion, the Company may request that the Construction facility be increased up to $15,000 at any time.

As of March 4, 2014, the Company was in full compliance with the covenants contained in the 2013 Loan Agreement.

Operating Activities

Net cash provided by continuing operations was $15,374 during the First Three Quarters of Fiscal 2014, which compares with $15,088 in the First Three Quarters of Fiscal 2013. This includes the effect of normal changes in assets and liabilities such asprepaid expenses, inventories, accounts payable and accrued, prepaid and deferred income taxes, all of which can and often do fluctuate widely from quarter to quarter. Management measures cash flows from continuing operations by simply adding back certain non-cash expenses to earnings from continuing operations. These non-cash expenses include items such as depreciation, losses (net of any gains) on dispositions of assets, charges for impairment of long-lived assets (if any), stock based compensation costs and pension costs in excess of plan contributions. The result of this approach is shown as a sub-total in the consolidated statement of cash flows: $14,522 in the First Three Quarters of Fiscal 2014 and $14,136 in the First Three quarters of Fiscal 2013.

Contributions to the defined benefit pension plan that is sponsored by the Company are currently projected to be $2,000 in Fiscal Year 2014, $1,200 of which was contributed during the First Three Quarters of Fiscal 2014.

The effect of the Final Repair Regulations (issued by the IRS in September 2013) upon the Company’s Change in Accounting Method that was filed in Fiscal Year 2011 (see discussion found above in Results of Operations - Income Tax Expense) is expected to result in additional tax due. Once the exact amount is determined (likely before the end of Fiscal 2014), the appropriate Forms 3115 will be filed with the IRS to conform the previous Change in Accounting Method to the Final repair Regulations. The ultimate amount due the IRS is expected to be immaterial and will be paid prospectively over a four year period.

Investing Activities

Capital spending is the principal component of investing activities. Capital spending was $11,440 during the First Three Quarters of Fiscal 2014, an increase of $3,385 from the First Three Quarters of Fiscal 2013. These capital expenditures typically consist of site acquisitions for expansion, new restaurant construction, plus on-going reinvestments in existing restaurants including remodeling jobs, routine equipment replacements and other maintenance capital outlays.

Proceeds from the disposition of property amounted to $559 during the First Three Quarters of 2014, consisting of $539 in real property and $20 from transactions to sell used equipment and /or other operating assets. The proceeds from the disposition of real property was from the July 2013 sale of a former Frisch's Big Boy restaurant and the September 2013 sale of certain excess property. Proceeds of $2,482 in the First Three Quarters of Fiscal 2013 arose principally from the August 2012 sale of one of the six Golden Corral properties that had closed in August 2011 and from the October 2012 sale of a Frisch's Big Boy restaurant that had closed in May 2012.

Three former Golden Corral restaurants (permanently closed August 2011) and seven other pieces of surplus land were held for sale as of March 4, 2014 at an aggregate asking price of approximately $6,200.

Financing Activities

When the 2013 Loan Agreement was executed on October 31, 2013, $2,000 was simultaneously drawn under the Revolving Credit Facility (Revolver) to refinance certain high interest Construction Term Loans. As part of the refinancing, six outstanding

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Construction Term Loans were retired with a single payment of $3,835, which was sourced from $1,835 in cash on hand and $2,000 drawn on the Revolver. In addition, $1,500 was drawn on the Revolver in February 2014 to meet working capital needs during the winter. Scheduled and other payments of long-term debt and capital lease obligations amounted to $3,693 during the First Three Quarters of Fiscal 2014, which included $250 paid back on the Revolver.

Regular quarterly cash dividends paid to shareholders during the First Three Quarters of Fiscal 2014 amounted to $2,643 or $0.52 per share. In addition, an $0.18 per share dividend was declared on March 13, 2014. Its payment of $918 on April 10, 2014 was the 213th consecutive quarterly dividend (a period of 53 years) paid by the Company. For the foreseeable future, the Company expects to continue its practice of paying regular quarterly cash dividends.

In addition to regular quarterly cash dividends, a special one-time cash dividend of $9.50 per share was paid during the First Three Quarters of Fiscal 2013 that amounted to $47,963.

During the First Three Quarters of Fiscal 2014, 12,502 shares of the Company’s common stock were re-issued from the Company’s treasury pursuant to the exercise of "cashless" stock options. The aggregate strike price was $173, all of which was received by the Company in cash, as all of the transactions were settled through a broker. As of March 4, 2014, 56,501 shares granted under the Company’s stock option plans remained outstanding, all of which are fully vested. The weighted average exercise price is$18.73 per share. The closing price of the Company’s stock on March 4, 2014 was $23.96. The intrinsic value of 49,667 fully vested “In The Money” options was $338, which, if exercised, would yield $852 in proceeds to the Company.

During the First Three Quarters of Fiscal 2013, 320,416 shares of the Company’s common stock were re-issued from the Company’s treasury pursuant to the exercise of stock options. The aggregate strike price for the options was $7,467, of which $2,398 was received in cash and $5,069 was charged to the treasury stock account to record shares re-acquired in connection with the exercise of "cashless" stock options that would have normally been settled through a broker on the open market.

On October 2, 2013, 11,984 shares of restricted stock were granted to non-employee members of the Board of Directors and an award of 1,712 restricted shares was granted to the CEO pursuant to the terms of his employment contract. The total fair value of the awards amounted to $320, which is being expensed ratably over a one year vesting period that began in the Second Quarter of Fiscal 2014. On October 3, 2012, 14,245 shares of restricted stock were granted to non-employee members of the Board of Directors and an award of 2,035 restricted shares was granted to the CEO. The total fair value of restricted shares issued to non-employee members of the Board of Directors and the CEO in October 2012 also amounted to $320, of which the run out of the final $123 was expensed during the First Half 2014. The same expense pattern was recorded in the First Half 2013.

In June 2013, a group of executive officers (excluding the CEO) and other key employees was granted an aggregate award of 13,450 unrestricted shares of the Company's common stock. The total fair value of the June 2013 award amounted to $244, which was accrued as incentive compensation in Fiscal Year 2013. Incentive compensation for unrestricted stock is also being accrued in Fiscal Year 2014.

In June 2012, a group of executive officers (excluding the CEO) and other key employees was granted an aggregate award of 4,850 unrestricted shares of the Company's common stock. The total fair value of the June 2012 award amounted to $127, which was recognized entirely when granted.

The fair value of restricted stock issued (one year vesting) and stock options granted (three year vesting - none granted since Fiscal Year 2011) is recognized as compensation cost on a straight-line basis over the vesting periods of the awards. Compensation costs arising from all share-based payments are charged to administrative and advertising expense in the consolidated statement of earnings:

	Third Quarter - 12 Weeks				First Three Quarters - 40 Weeks
Share based compensation cost	2014		2013		2014		2013
	(in thousands)				(in thousands)
Stock options granted - June 2010	$	—	$	14	$	—	$	42
Restricted stock issued - October 2013	74		—		123		—
Restricted stock issued - October 2012	—		74		123		123
Restricted stock issued - October 2011	—		—		—		123
Unrestricted stock issued - June 2012	—		—		—		127
Share-based compensation cost, pretax	$	74	$	88	$	246	$	415

On July 25, 2012, the Board of Directors authorized the Company to purchase over a three year period, on the open market and in privately negotiated transactions, up to 450,000 shares of its common stock. No shares were acquired under the program during

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the First Three Quarters of Fiscal 2014. During the First Three Quarters of Fiscal 2013, the Company re-acquired 212,929 shares under the program at a cost of $6,708.

Separate from the repurchase program, the Company’s treasury acquired 5,381 shares of its common stock in the First Three Quarters of Fiscal 2014 at a cost of $105 to cover withholding tax obligations in connection with unrestricted and restricted stock awards. During the First Three Quarters of 2013, 5,227 shares were acquired at a cost of $119, also to cover withholding tax obligations on various stock awards.

Other Information

One new Frisch's Big Boy restaurant opened for business during the First Three Quarters of Fiscal 2014, in early December 2013. Although no new Frisch's Big Boy restaurants are currently under construction and there are no contracts currently pending to acquire or lease land on which to build, the Company owns five land tracts at various locations in Ohio, Indiana and Kentucky for which development has been deferred for the time being.

Including land and land improvements, the cost required to build and equip the Frisch's Big Boy restaurant that opened in December 2013 amounted to approximately $3,900. Its construction used plans for the original 2001 building prototype (5,700 square feet with seating for 172 guests).

Approximately one-fifth of the Frisch's Big Boy restaurants are routinely renovated or decoratively updated each year. The renovations not only refresh and upgrade interior finishes, but are also designed to synchronize the interiors and exteriors of older restaurants with those of newly constructed restaurants. The current average cost to remodel a Frisch's Big Boy restaurant ranges from $80 to $100 for a minor remodeling and from $185 to $215 for a major remodeling. The Fiscal Year 2014 remodeling budget is $3,030 for 18 planned remodel jobs, 13 of which had been completed by March 4, 2014.

Part of the Company’s strategic plan entails owning the land on which it builds new restaurants. However, it is sometimes necessary to enter ground leases to obtain desirable land on which to build. As of March 4, 2014, 15 Frisch's Big Boy restaurants were in operation on non-owned premises – one capital lease and 14 operating leases.

The Company remains contingently liable under certain ground lease agreements relating to land on which seven of the Company's former Golden Corral restaurants are situated. The seven leases were assigned to Golden Corral Corporation (GCC) as part of the May 2012 transaction to sell the restaurants to GCC. The amount remaining under contingent lease obligations totaled $6,436 as of March 4, 2014, for which the aggregate average annual lease payments approximate $665 in each of the next five years. Since there is no reason to believe that GCC (the owner and franchisor of the Golden Corral brand) is likely to default, no provision has been made in the consolidated financial statements for amounts that would be payable by the Company.

APPLICATION of CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to use estimates and assumptions to measure certain items that affect the amounts reported in the financial statements and accompanying footnotes. These judgments are based on knowledge and experience about past and current events, and assumptions about future events. Accounting estimates can and do change as new events occur and additional information becomes available. Actual results may differ markedly from current judgment.

Two factors are required for an accounting policy to be deemed critical. The policy must be significant to the fair presentation of a company’s financial condition and its results of operations, and the policy must require management’s most difficult, subjective or complex judgments. Management believes the following to be the Company’s critical accounting policies.

Self Insurance

The Company self-insures a significant portion of expected losses from its workers’ compensation program in the state of Ohio. The Company purchases coverage from an insurance company for protection against individual claims in excess of $300,000.

An actuarial consulting company provided an independent estimate of the Company's required unpaid loss and allocated loss adjustment expense for accidents occurring from the inception of the Company's self-insurance program through May 28, 2013, (the end of Fiscal Year 2013). The actuarial consulting firm also provided forward estimates (based on historical claims data) of

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the ultimate value of claims that will be incurred during the current fiscal year, which is used by management to build the claims reserve for Fiscal Year 2014. As the expected value estimates provided by the actuarial consulting firm were developed over the range of reasonably possible (as opposed to all conceivable) outcomes, unexpected case developments could result in actual costs differing materially from estimated values that are now carried in the self-insurance reserves. Until the actuarial consulting firm provides its independent estimate of the claims values as of June 3, 2014 (the end of Fiscal Year 2014), management will continue to monitor claim data as presented by the third party administrator (TPA) of the program and will only make interim period adjustments to the self-insurance reserves if a catastrophic claim is incurred during the current fiscal year or if actual payments of claims differ significantly from the expected payment patterns that have been developed by the actuarial consulting firm.

Pension Plans

Pension plan accounting requires rate assumptions for future compensation increases and the long-term investment return on plan assets. A discount rate is also applied to the calculations of net periodic pension cost and projected benefit obligations. A committee consisting of executives from the Finance Department and the Human Resources Department, with guidance provided by the Company’s actuarial consulting firm, develops these assumptions each year. The consulting firm also provides services in calculating estimated future obligations and net periodic pension cost.

To determine the long-term rate of return on plan assets, the committee considers a weighted average of the historical broad market return and the forward looking expected return. Returns are developed based on the plan's target asset allocation: 70 percent Domestic Equity, 25 percent Fixed Income and 5 percent Cash. The model to develop the historical broad market return assumes the widest period of historical data available for each asset class (as early as 1926 (in some cases) through 2012). Domestic equity securities are allocated equally between large cap and small cap funds, with fixed income securities allocated equally between long-term corporate/government bonds and intermediate-term government bonds. The model for the forward looking expected return uses a range of expected outcomes over a number of years based on the plan's asset allocation as noted above and assumptions about the return, variance, and co-variance for each asset class. The historical and forward looking returns are adjusted to reflect a 0.20 percent investment expense assumption representative of passive investments. The weighted average of the historical broad market return and the forward looking expected return is rounded to the nearest 25 basis points to determine the overall expected rate of return on plan assets.

The discount rate is selected by matching the cash flows of the pension plan to that of a yield curve that provides the equivalent yields on zero-coupon bonds for each maturity. Benefit cash flows due in a particular year can be "settled" theoretically by "investing" them in the zero-coupon bond that matures in the same year. The discount rate is the single rate that produces the same present value of cash flows. The selection of the discount rate represents the equivalent single rate under a broad market AA yield curve (Above Mean Yield Curve as developed by the Company's actuarial consulting firm beginning with the May 28, 2013 measurement date, which has been applied to the calculation of net periodic pension cost for Fiscal Year 2014). The yield curve is used to set the discount rate assumption using cash flows on an aggregate basis, which is then rounded to the nearest 10 basis points.

Pension plan assets are targeted to be invested 70 percent in equity securities, as these investments have historically provided the greatest long-term returns. Poor performance in equity securities markets can significantly lower the market values of the investment portfolios, which, in turn, can result in a) material increases in future funding requirements, b) much higher net periodic pension costs to be recognized in future years, and c) increases in underfunded plan status, requiring the Company’s equity to be reduced.

Long-Lived Assets

Long-lived assets include property and equipment, goodwill and other intangible assets. Judgments and estimates are used to determine the carrying value of long-lived assets. This includes the assignment of appropriate useful lives, which affect depreciation and amortization expense. Capitalization policies are monitored continually to assure that they remain appropriate.

Management considers a history of cash flow losses on a restaurant-by-restaurant basis to be the primary indicator of potential impairment. Carrying values of property and equipment are tested for impairment at least annually, and whenever events or circumstances indicate that the carrying values of the assets may not be recoverable from the estimated future cash flows expected to result from the use and eventual disposition of the property. When undiscounted expected future cash flows are less than carrying values, an impairment loss is recognized equal to the amount by which carrying values exceed fair value, which is determined as either 1) the greater of the net present value of the future cash flow stream, or 2) by opinions of value provided by real estate brokers and/or management's judgment as developed through its experience in disposing of unprofitable restaurant operations. Broker opinions of value and the judgment of management consider various factors in their fair value estimates such as the sales of comparable area properties, general economic conditions in the area, physical condition and location of the subject property, and general real estate activity in the local market. Future cash flows can be difficult to predict. Changing neighborhood demographics and economic conditions, and many other factors may influence operating performance, which affect cash flows.

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Sometimes it becomes necessary to cease operating a certain restaurant due to poor operating performance. The ultimate loss can be significantly different from the original impairment charge, particularly if the eventual market price received from the disposition of the property differs materially from initial estimates of fair values.

Acquired goodwill and other intangible assets are tested for impairment annually or whenever an impairment indicator arises.

Income Taxes

The provision for income taxes is based on management's estimate of federal, state and local tax liabilities. These estimates include, but are not limited to, the application of statutory federal, state and local rates to estimated taxable income, and the effect of tax credits such as the federal credits allowed for Employer Social Security and Medicare Taxes Paid on Certain Employee Tips and the Work Opportunity Tax Credit (WOTC). All tax returns are filed timely and are subject to audit by all levels of taxing authority. Audits can result in a different interpretation of tax laws from that of management.

Deferred tax assets and liabilities result from timing differences in the recognition of revenue and expense between financial reporting and tax statutes. Deferred tax accounting requires management to evaluate deferred tax assets, including net operating loss carry forwards. These evaluations entail complex projections that require considerable judgment and are ultimately subject to future changes in tax laws including changes in tax rates. Part of the evaluation requires management to assess whether deferred tax assets will more likely than not be realized on a future tax return. If management's evaluation determines that it is more likely that such deferred tax assets will not be realized, a valuation allowance will be recorded. The Company does not currently carry any such valuation allowance.

ITEM 3. QUANTITATIVE and QUALITATIVE DISCLOSURES about MARKET RISKS

Conditions in the financial and commodity markets are subject to change at any time.

Although the the Company's revolving debt is subject to a one-month LIBOR rate, management believes the Company has no significant market risk exposure to interest rate changes. All of the Company's other debt is term debt that is financed with fixed interest rates, or will be converted to fixed rate term loans in the next six months. The Company does not currently use derivative financial instruments to manage its exposure to changes in interest rates. Any cash equivalents maintained by the Company have original maturities of 90 days or less. Cash may be in excess of FDIC limits. The Company does not use any foreign currency in its operations.

Operations are vertically integrated, using centralized purchasing and food preparation, provided through the Company’s commissary and food manufacturing plant. Management believes the commissary operation ensures uniform product quality and safety, timeliness of distribution to restaurants and creates efficiencies that ultimately result in lower food and supply costs.

Commodity pricing affects the cost of many of the Company’s food products. Commodity pricing can be extremely volatile, affected by many factors outside of management’s control, including import and export restrictions, the influence of currency markets relative to the U.S dollar, the effects of supply versus demand, production levels and the impact that adverse weather conditions may have on crop yields.

Certain commodities purchased by the commissary, principally beef, chicken, pork, dairy products, fresh produce, fish, French fries and coffee, are generally purchased based upon market prices established with vendors. Purchase contracts for some of these items may contain contractual provisions that limit the price to be paid. These contracts are generally for periods of one year or less but may have longer terms if favorable long-term pricing is offered. Food supplies are generally plentiful and may be obtained from any number of suppliers, which mitigates the Company’s overall commodity cost risk. Quality, timeliness of deliveries and price are the principal determinants of source. Management does not use financial instruments as a hedge against changes in commodity pricing.

ITEM 4. CONTROLS and PROCEDURES

a)Effectiveness of Disclosure Controls and Procedures. The Company’s Chief Executive Officer (CEO) and Chief Financial Officer (CFO) reviewed and evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)) as of March 4, 2014, the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, the CEO and CFO concluded that the Company’s disclosure controls and procedures were effective as of such date to ensure that information that would be required to be disclosed in the Company’s Exchange Act reports is (i) recorded, processed, summarized and reported within the time periods specified in

33

Securities and Exchange Commission rules and forms, and (ii) would be accumulated and communicated to the Company’s management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosures.

b)Changes in Internal Control over Financial Reporting. As part of their review and evaluation of the Company's disclosure controls and procedures, the Company's CEO and CFO concluded that there were no changes in the Company’s internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) or 15d-15(f)) during the fiscal quarter ended March 4, 2014 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Reference is made to the discussion under "Part I, Item 3.Legal Proceedings" in the Company's Annual Report on Form 10-K for the year ended May 28, 2013 regarding the collective action and class action filing related to allegations of off-the-clock work, unpaid overtime, and minimum wage violations as a result of alleged improper application of the Tip Credit. On December 4, 2012, the Company filed a motion to dismiss and compel arbitration, which motion was granted on April 10, 2013. The plaintiff appealed the decision to the United States 6th Circuit Court of Appeals. Oral arguments had been scheduled for December 5, 2013. Prior to oral arguments, the plaintiff withdrew the appeal voluntarily. The matter may now only proceed as a single party arbitration without any component for class or collective action. The Company will continue to defend the matter vigorously should the plaintiff wish to proceed into arbitration.

ITEM 1A. RISK FACTORS

Operational and other risks and uncertainties that face the Company were set forth in Part I Item 1A of the Company's Annual Report on Form 10-K for the fiscal year ended May 28, 2013. There have been no material changes in the risks from those that were disclosed in that Form 10-K.

The materialization of events associated with the risks disclosed in the Form 10-K for the fiscal year ended May 28, 2013 together with those risks that were not specifically listed or those that are unforeseen at the present time, could result in significant adverse effects on the Company’s financial position, results of operations and cash flows, which could include the permanent closure of any affected restaurant(s) with an impairment of assets charge taken against earnings, and could adversely affect the price at which shares of the Company’s common stock trade.

ITEM 2. UNREGISTERED SALES of EQUITY SECURITIES and USE of PROCEEDS

(c) Issuer Purchases of Equity Securities

On July 25, 2012, the Board of Directors authorized the Company to purchase, on the open market and in transactions negotiated privately, up to 450,000 shares of its common stock. The authorization allows for purchases over a three year period that will end on July 25, 2015. The following table shows information pertaining to the Company’s repurchases of its common stock during the Third Quarter Fiscal 2014, which ended March 4, 2014:

	Total Number Of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
December 11, 2013 to January 7, 2014	—	$	—	—	237,071
January 8, 2014 to February 4, 2014	—	$	—	—	237,071
February 5, 2014 to March 4, 2014	—	$	—	—	237,071
Total	—	$	—	—	237,071

ITEM 3. DEFAULTS upon SENIOR SECURITIES

Not applicable

34

ITEM 4. MINE SAFTEY DISCLOSURES

Not applicable

ITEM 5. OTHER INFORMATION

Not applicable

ITEM 6. EXHIBITS

Other Exhibits

31.1 Certification of Chief Executive Officer pursuant to rule 13a-14(a)/15d-14(a) is filed herewith.

31.2 Certification of Chief Financial Officer pursuant to rule 13a-14(a)/15d-14(a) is filed herewith.

32.1 Section 1350 Certification of Chief Executive Officer is filed herewith.

32.2 Section 1350 Certification of Chief Financial Officer is filed herewith.

The XBRL interactive date files appearing below are filed herewith:

101.INS    XBRL Instance Document                        

101.SCH     XBRL Taxonomy Extension Schema Document            

101.CAL     XBRL Taxonomy Extension Calculation Linkbase Document        

101.LAB    XBRL Taxonomy Extension Label Linkbase Document        

101.PRE    XBRL Taxonomy Presentation Linkbase Document            

101.DEF    XBRL Taxonomy Extension Definition Linkbase Document        

35

SIGNATURE

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.

	FRISCH’S RESTAURANTS, INC.
	(Registrant)
DATE April 8, 2014
	BY      /s/ Mark R. Lanning
	Mark R. Lanning
	Vice President and Chief Financial Officer,
	Principal Financial Officer
	Principal Accounting Officer

36

EX-31.1

EXHIBIT 31.1

CERTIFICATION    RULE 13a – 14(a)/15d – 14(a)

I, Craig F. Maier, President and Chief Executive Officer of Frisch’s Restaurants, Inc., certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Frisch’s Restaurants, Inc. (the “Registrant”);

2. Based on my knowledge, this Quarterly Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Quarterly Report;

3. Based on my knowledge, the financial statements, and other financial information included in this Quarterly Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this Quarterly Report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and we have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Quarterly Report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this Quarterly Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Quarterly Report based on such evaluation; and

d) Disclosed in this Quarterly Report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date: April 8, 2014	/s/ Craig F. Maier
	Craig F. Maier, President and Chief
	Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION    RULE 13a – 14(a)/15d – 14(a)

I, Mark R. Lanning, Vice President-Finance and Chief Financial Officer of Frisch’s Restaurants, Inc., certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Frisch’s Restaurants, Inc. (the “Registrant”);

2. Based on my knowledge, this Quarterly Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Quarterly Report;

3. Based on my knowledge, the financial statements, and other financial information included in this Quarterly Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this Quarterly Report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and we have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Quarterly Report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles ;

c) Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this Quarterly Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Quarterly Report based on such evaluation; and

d) Disclosed in this Quarterly Report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date: April 8, 2014	/s/ Mark R. Lanning
	Mark R. Lanning, Vice President-Finance and
	Chief Financial Officer, Principal Financial Officer
	and Principal Accounting Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION of CHIEF EXECUTIVE OFFICER

PURSUANT to SECTION 1350 of CHAPTER 63 of TITLE 18 of the UNITED STATES CODE,

as ADOPTED PURSUANT to

SECTION 906 of THE SARBANES-OXLEY ACT OF 2002

In connection with the filing with the Securities and Exchange Commission of the Quarterly Report of Frisch’s Restaurants, Inc. (the “Registrant”) on Form 10-Q for the quarter ended March 4, 2014 (the “Report”), the undersigned officer of the Registrant certifies, pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Date: April 8, 2014	By:	/s/ Craig F. Maier
		Craig F. Maier, President and
		Chief Executive Officer

This certification is being furnished as required by Rule 13a – 14(b) under the Securities Exchange Act of 1934 (“Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the United States Code, and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that Section. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except as other otherwise stated in such filing.

EX-32.2

EXHIBIT 32.2

CERTIFICATION of CHIEF FINANCIAL OFFICER

PURSUANT to SECTION 1350 of CHAPTER 63 of TITLE 18 of the UNITED STATES CODE,

as ADOPTED PURSUANT to

SECTION 906 of THE SARBANES-OXLEY ACT OF 2002

In connection with the filing with the Securities and Exchange Commission of the Quarterly Report of Frisch’s Restaurants, Inc. (the “Registrant”) on Form 10-Q for the quarter ended March 4, 2014 (the “Report”), the undersigned officer of the Registrant certifies, pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Date: April 8, 2014	By:	/s/ Mark R. Lanning
		Mark R. Lanning, Vice President-Finance and
		Chief Financial Officer, Principal Financial
		Officer and Principal Accounting Officer

This certification is being furnished as required by Rule 13a – 14(b) under the Securities Exchange Act of 1934 (“Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the United States Code, and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that Section. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except as other otherwise stated in such filing.

XML

Accrued Expenses Accounts payable (Details) (USD $) In Thousands, unless otherwise specified	Mar. 04, 2014	May 28, 2013
Fair Value Disclosures [Abstract]
Accounts Payable, Trade, Current	$ 4,728	$ 3,574
Sales and Excise Tax Payable, Current	1,469	581
Accrued Utilities, Current	578	621
Gift Card Liability, Current	950	748
Other Employee Related Liabilities	230	355
Salaries, wages and related expenses	4,494	4,513
Accounts payable	$ 7,955	$ 5,879

XML

Pension Plans - Postretirement Benefits Disclosures (Details) (Level 1, USD $) In Thousands, unless otherwise specified	Mar. 04, 2014	May 28, 2013
Defined Benefit Plan Disclosure [Line Items]
Executive Savings Plan, Fair Value of Plan Assets	$ 3,476	$ 2,854
Large Blend Target Date Mutual Funds [Member]
Defined Benefit Plan Disclosure [Line Items]
Executive Savings Plan, Fair Value of Plan Assets	497	414
Taxable Bond Mutual Funds [Member]
Defined Benefit Plan Disclosure [Line Items]
Executive Savings Plan, Fair Value of Plan Assets	534	798
Mutual Funds [Member]
Defined Benefit Plan Disclosure [Line Items]
Executive Savings Plan, Fair Value of Plan Assets	1,771	1,310
Money Market Funds [Member]
Defined Benefit Plan Disclosure [Line Items]
Executive Savings Plan, Fair Value of Plan Assets	432	45
Foreign Equity Mutual Funds [Member]
Defined Benefit Plan Disclosure [Line Items]
Executive Savings Plan, Fair Value of Plan Assets	$ 242	$ 287

XML

Shareholders' Equity/Capital Stock - Share-based Compensation Expense (Details) (USD $)	3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended		0 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014 Stock Options	Mar. 05, 2013 Stock Options	Mar. 04, 2014 Stock Options	Mar. 05, 2013 Stock Options	Mar. 04, 2014 Restricted stock	Mar. 05, 2013 Restricted stock	Mar. 04, 2014 Restricted stock	Mar. 05, 2013 Restricted stock	Mar. 04, 2014 Unrestricted stock	Mar. 05, 2013 Unrestricted stock	Mar. 04, 2014 Unrestricted stock	Mar. 05, 2013 Unrestricted stock	Jun. 13, 2012 Key employees (excluding chief executive officer) 2003 Plan Unrestricted stock	Mar. 04, 2014 Subsequent Event [Member] Key employees (excluding chief executive officer) 2012 Plan Unrestricted stock	Mar. 05, 2013 Subsequent Event [Member] Key employees (excluding chief executive officer) 2012 Plan Unrestricted stock	Mar. 04, 2014 Subsequent Event [Member] Key employees (excluding chief executive officer) 2012 Plan Unrestricted stock	Mar. 05, 2013 Subsequent Event [Member] Key employees (excluding chief executive officer) 2012 Plan Unrestricted stock	May 28, 2013 Subsequent Event [Member] Key employees (excluding chief executive officer) 2012 Plan Unrestricted stock
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based compensation expense, pre-tax	$ 74,000	$ 88,000	$ 246,000	$ 415,000	$ 0	$ 14,000	$ 0	$ 42,000	$ 74,000	$ 74,000	$ 246,000	$ 246,000	$ 0	$ 0	$ 0	$ 127,000	$ 127,000	$ 52,000	$ 30,000	$ 173,000	$ 101,000	$ 244,000
Shares granted from re-issued treasury stock, shares																	4,850,000					13,450,000
Tax benefit	(25,000)	(30,000)	(84,000)	(141,000)
Share-based compensation expense, net of tax	49,000	58,000	162,000	274,000
Dilutive Securities, Effect on Basic Earnings Per Share [Abstract]
Effect on basic and diluted earnings per share	$ 0.01	$ 0.01	$ 0.03	$ 0.05
Effect on Diluted Earnings Per Share, Including Options, Restrictive, and Unrestrictive Stock Units	$ 0.01	$ 0.01	$ 0.03	$ 0.05
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized [Abstract]
Total compensation cost not yet recognized, period for recognition									7 months 12 days
Total compensation cost not yet recognized, restricted stock									$ 197,000		$ 197,000

XML

Long-term Debt Instruments (Details) (USD $)	3 Months Ended						9 Months Ended
	Dec. 10, 2013	Mar. 04, 2014	Sep. 17, 2013	May 28, 2013	Mar. 04, 2014 Construction Phase Loan Converted to Term Loans	Sep. 17, 2013 Construction Phase Loan Converted to Term Loans	Mar. 04, 2014 Revolving Credit Facility [Member]	Mar. 04, 2014 Construction Loans, Construction Phase [Member]	Mar. 04, 2014 Long-term Debt, Stock Repurchase Loan [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity								$ 5,000,000
Line of Credit Facility, Maximum Borrowing Capacity that can be Obtained by the Company at the Lender's Discretion								15,000,000
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage							0.25%	0.25%
Line of Credit Facility, Current Borrowing Capacity		11,000,000	5,000,000
Unsecured Debt		10,583,000		14,446,000	6,685,000	11,812,000			648,000
Long-term loans payable within one year		2,174,000		4,846,000
Long-term loans payable after one year		8,409,000		9,600,000
Repayments of Construction Loans Payable	3,835,000
Repayments of Debt	1,835,000
Proceeds from Other Debt	2,000,000
Line of Credit Facility, Amount Outstanding							$ 3,250,000

XML

Other Comprehensive Income (Tables)

9 Months Ended

Mar. 04, 2014

Equity [Abstract]

Schedule of items reclassified out of accumulated other comprehensive income

he following table summarizes items reclassified out of accumulated other comprehensive income and the related tax effects for the components of net periodic pension cost:

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands)
Amortization of pretax amounts included in net periodic pension expense (1)
Included in Cost of Sales	$	611		$	1,247		$	183		$	375
Included in Administrative and Advertising Expense	37			64			11			19
Total reclassification (pretax) (1)	648			1,311			194			394
Tax benefit	(220		)	(446		)	(66		)	(134		)
Total reclassification (net of tax)	$	428		$	865		$	128		$	260

(1) These amounts are included in the computation of net periodic pension expense as a net of the two components (See NOTE F - PENSION PLANS) as shown below:

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands)
Amortization of prior service (credit) cost	$	(6	)	$	(6	)	$	(2	)	$	(2	)
Recognized net actuarial loss	654			1,317			196			396
Total reclassification (pretax)	$	648		$	1,311		$	194		$	394

Schedule of changes in accumulated other comprehensive loss

The following table summarizes changes in accumulated other comprehensive loss (all of which is from Company sponsored pension plans), net of tax, for the 40 week period ended March 4, 2014:

Accumulated Other Comprehensive Loss	March 4, 2014
	(in thousands)
Balance in Accumulated Other Comprehensive Loss on May 28, 2013	$	4,324
Amount reclassified from accumulated other comprehensive income	(428		)
Net other comprehensive (income) loss	(428		)
Balance in Accumulated Other Comprehensive Loss on March 4, 2014	$	3,896

XML

Other Comprehensive Income - Reclassified out of Accumulated Other Comprehensive Income (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended				9 Months Ended
	Mar. 04, 2014		Mar. 05, 2013		Mar. 04, 2014		Mar. 05, 2013
Amortization of pretax amounts included in net periodic pension expense
Defined Benefit Plan, Service Cost	$ 374		$ 416		$ 1,248		$ 1,387
Included in Administrative and Advertising Expense	2,846		2,695		9,443		10,109
Tax benefit	(691)		621		972		2,133
Prior-service costs	(194)		(394)		(648)		(1,311)
Pension plans
Amortization of pretax amounts included in net periodic pension expense
Earnings from continuing operations					(428)
Reclassification out of accumulated other comprehensive income | Pension plans
Amortization of pretax amounts included in net periodic pension expense
Included in Cost of Sales	183	[1]	375		611	[1]	1,247	[1]
Included in Administrative and Advertising Expense	11	[1]	19		37	[1]	64	[1]
Total Amortization of pretax amounts included in net periodic pension expense	194	[1]	394	[1]	648	[1]	1,311	[1]
Tax benefit	(66)		(134)		(220)		(446)
Earnings from continuing operations	128		260		428		865
Prior-service costs	(196)		(396)		(654)		(1,317)
Actuarial losses	$ 2		$ 2		$ 6		$ 6

[1] These amounts are included in the computation of net periodic pension expense as a net of the two components (See NOTE F - PENSION PLANS) as shown below: 40 weeks ended 12 weeks ended March 4, 2014 March 5, 2013 March 4, 2014 March 5, 2013 (in thousands)Amortization of prior service (credit) cost$(6) $(6) $(2) $(2)Recognized net actuarial loss654 1,317 196 396Total reclassification (pretax)$648 $1,311 $194 $394

XML

Shareholders' Equity/Capital Stock - Exercise Price Range (Details) (1993 Plan and 2003 Plan, USD $)	3 Months Ended
	Dec. 10, 2013
$10.05 to $15.90
Outstanding:
Exercise price range, lower limit	$ 10.05
Exercise price range, upper limit	$ 15.90
Exercisable:
Exercise price range, lower limit	$ 10.05
Exercise price range, upper limit	$ 15.90
$15.91 to $24.20
Outstanding:
Exercise price range, lower limit	$ 15.91
Exercise price range, upper limit	$ 24.20
Exercisable:
Exercise price range, lower limit	$ 15.91
Exercise price range, upper limit	$ 24.20
$24.21 to $30.13
Outstanding:
Exercise price range, lower limit	$ 24.21
Exercise price range, upper limit	$ 30.13
Exercisable:
Exercise price range, lower limit	$ 24.21
Exercise price range, upper limit	$ 30.13
$10.05 to $30.13
Outstanding:
Exercise price range, lower limit	$ 10.05
Exercise price range, upper limit	$ 30.13
Exercisable:
Exercise price range, lower limit	$ 10.05
Exercise price range, upper limit	$ 30.13

XML

Leased Property - Schedule of Future Minimum Payments (Details) (USD $) In Thousands, unless otherwise specified	Mar. 04, 2014	May 28, 2013
Capital Leases, Future Minimum Payments, Net Present Value [Abstract]
Long-term obligations	$ 1,877	$ 2,050

XML

Pension Plans - Net Periodic Pension Cost Components (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended		12 Months Ended	9 Months Ended	12 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013	Jun. 03, 2014	Mar. 04, 2014 Forecast [Member]	Jun. 03, 2014 Forecast [Member]	May 28, 2013 Forecast [Member]
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract]
Service cost	$ 374	$ 416	$ 1,248	$ 1,387
Interest cost	419	400	1,397	1,334
Defined Benefit Plan, Expected Return on Plan Assets	558	460	1,859	1,535
Expected return on plan assets					(4,296)
Amortization of prior service cost	(2)	(2)	(6)	(6)
Defined Benefit Plan, Actuarial Gain (Loss)	(196)	(395)	(654)	(1,317)
Net periodic pension cost	429	749	1,434	2,497			1,864	3,247
Weighted average discount rate	4.40%	4.25%	4.40%	4.25%
Weighted average rate of compensation increase	4.00%	4.00%	4.00%	4.00%
Weighted average expected long-term rate of return on plan assets	7.25%	7.50%	7.25%	7.50%
Defined Benefit Plan, Net Periodic Benefit Cost, Decrease Due to Higher Discount Rate, Percent						42.00%
Defined Benefit Plans, Estimated Future Employer Contributions in Next Fiscal Year					2,000
Pension Contributions			$ 1,200	$ 1,544

XML

Consolidated Statement of Cash Flows (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013
Cash flows provided by (used in) operating activities:
NET EARNINGS (LOSS)	$ 5,861	$ 4,548
Less: loss from discontinued operations	0	(158)
Earnings from continuing operations	5,861	4,706
Adjustments to reconcile net earnings to net cash from operating activities:
Depreciation and amortization	8,160	7,936
Loss on disposition of assets, including abandonment losses	21	55
Impairment of long-lived assets	0	71
Stock-based compensation expense	246	415
Net periodic pension cost	1,434	2,497
Contributions to pension plans	(1,200)	(1,544)
Adjustments to reconcile net (loss) earnings to net cash from operating activities, total	14,522	14,136
Changes in assets and liabilities:
Trade and other receivables	(163)	171
Inventories	(638)	(941)
Prepaid expenses, sundry deposits and other	(237)	(521)
Other assets	(88)	2
Prepaid, accrued and deferred income taxes	(786)	1,344
Excess tax benefit from stock-based compensation	(24)	(364)
Accounts payable	2,076	1,131
Accrued expenses	(518)	217
Self insured obligations	160	(343)
Deferred compensation and other liabilities	1,070	256
Changes in assets and liabilities, total	852	952
Net cash provided by continuing operations	15,374	15,088
Net cash (used in) provided by discontinued operations	0	(651)
Net cash provided by operating activities	15,374	14,437
Cash flows provided by (used in) investing activities:
Additions to property and equipment	(11,440)	(8,055)
Proceeds from disposition of property	559	2,482
Change in restricted cash	0	3,493
Change in other assets	(623)	(289)
Net cash provided by (used in) investing activities	(11,504)	(2,369)
Cash flows (used in) provided by financing activities:
Proceeds from borrowings	3,500	0
Payment of long-term debt and capital lease obligations	(7,528)	(5,699)
Cash dividends paid	(2,643)	(2,408)
Special cash dividend paid	0	(47,963)
Proceeds from stock options exercised	172	7,468
Excess tax benefit from stock options exercised	24	364
Treasury shares acquired	(105)	(6,827)
Other treasury shares re-issued	286	12
Employee stock purchase plan	(36)	33
Net cash (used in) financing activities	(6,330)	(55,020)
Net increase (decrease) in cash and equivalents	(2,460)	(42,952)
Cash and equivalents at beginning of year	4,256	45,962
Cash and equivalents at end of year	1,796	3,010
Supplemental disclosures:
Interest paid	544	841
Income taxes paid	1,780	948
Lease transactions capitalized (non-cash)	$ 0	$ 781

XML

Shareholders' Equity/Capital Stock - Employee Stock Purchase Plan and Executive Savings Plan (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013
Share-based compensation expense, pre-tax	$ 74	$ 88	$ 246	$ 415
Employee stock purchase plan			(36)
Additional Contributed Capital
Employee stock purchase plan			(36)
Employee Stock Purchase Plan [Member]
Share-based compensation expense, pre-tax			$ 20	$ 122

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Accounting Policies - Goodwill and Other Intangible Assets (Details) (USD $) In Thousands, unless otherwise specified	Mar. 04, 2014	May 28, 2013
Goodwill and Other Intangible Assets, Including Licensing Agreements [Abstract]
Goodwill	$ 741	$ 741
Other intangible assets not subject to amortization	22	22
Other intangible assets subject to amortization - net	10	12
Goodwill and other intangible assets	$ 773	$ 775

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Accounting Policies - Fair Value Measurements (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Impairment of long-lived assets	$ 0	$ 0	$ 0	$ 71
Two former Frisch's Big Boy restaurants
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Impairment of long-lived assets				$ 71

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Shareholders' Equity/Capital Stock - Treasury Stock and Dividends (Details) (USD $)	3 Months Ended		9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013	Mar. 14, 2014 Subsequent Event [Member]
Class of Stock [Line Items]
Shares acquired to cover witholding tax obligations, value	$ 25,000	$ 30,000	$ 84,000	$ 141,000
Dividends [Abstract]
Cash dividends paid			2,643,000
Cash dividends paid, per share			$ 0.52
dividend declared per share					$ 0.18
Cash dividends, declared not yet paid					$ 918,000
Number of consecutive years of cash dividend payment as of reporting date	53 years		53 years

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Accounting Policies Income Taxes (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended		3 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013	Jun. 03, 2014 Minimum [Member] Forecast [Member]	Jun. 03, 2014 Maximum [Member] Forecast [Member]
Income Taxes [Line Items]
Effective tax rate (benefit)	(14.10%)	26.20%	22.50%	30.00%
Effective tax before discrete items	$ (126)	$ 621	$ 1,537	$ 2,052
Discrete - valuation allowances (released) placed	(222)	0	(222)	81
Discrete - domestic production activities deduction	(343)	0	(343)	0
Income Tax Expense (Benefit)	$ (691)	$ 621	$ 972	$ 2,133	$ 600	$ 700

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Discontinued Operations - Narrative (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment of long-lived assets	$ 0	$ 0	$ 0	$ 71
Golden Corral, disposal group
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued Operation, Tax Effect of Discontinued Operation				$ 158

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Consolidated Statement of Shareholders' Equity (Parenthetical) (USD $)	9 Months Ended
	Mar. 04, 2014
Cash dividends, per share	$ 0.34

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Discontinued Operations - Fair Value Measurements (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Impairment of long-lived assets	$ 0	$ 0	$ 0	$ (71)

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Shareholders' Equity/Capital Stock - Compensation Plans And Award Types (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended				9 Months Ended		3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended		0 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014 1993 Plan and 2003 Plan	May 28, 2013 1993 Plan and 2003 Plan	Mar. 04, 2014 Employee Stock Purchase Plan [Member]	Mar. 05, 2013 Employee Stock Purchase Plan [Member]	Mar. 04, 2014 Stock Options	Mar. 05, 2013 Stock Options	Mar. 04, 2014 Stock Options	Mar. 05, 2013 Stock Options	Mar. 04, 2014 Restricted stock	Mar. 05, 2013 Restricted stock	Mar. 04, 2014 Restricted stock	Mar. 05, 2013 Restricted stock	Mar. 04, 2014 Unrestricted stock	Mar. 05, 2013 Unrestricted stock	Mar. 04, 2014 Unrestricted stock	Mar. 05, 2013 Unrestricted stock	Jun. 13, 2012 Unrestricted stock 2003 Plan Key employees (excluding chief executive officer)	Mar. 04, 2014 Subsequent Event [Member] Unrestricted stock 2012 Plan Key employees (excluding chief executive officer)	Mar. 05, 2013 Subsequent Event [Member] Unrestricted stock 2012 Plan Key employees (excluding chief executive officer)	Mar. 04, 2014 Subsequent Event [Member] Unrestricted stock 2012 Plan Key employees (excluding chief executive officer)	Mar. 05, 2013 Subsequent Event [Member] Unrestricted stock 2012 Plan Key employees (excluding chief executive officer)	May 28, 2013 Subsequent Event [Member] Unrestricted stock 2012 Plan Key employees (excluding chief executive officer)
Restricted Stock Awards Under 2003 and 2012 Plans [Abstract]
Shares granted from re-issued treasury stock, shares																					4,850,000					13,450,000
Shares granted from re-issued treasury stock, value	$ 74	$ 88	$ 246	$ 415			$ 20	$ 122	$ 0	$ 14	$ 0	$ 42	$ 74	$ 74	$ 246	$ 246	$ 0	$ 0	$ 0	$ 127	$ 127	$ 52	$ 30	$ 173	$ 101	$ 244
Unrestricted Stock Awards Under the 2003 Plan [Abstract]
Shares granted from re-issued treasury stock, shares																					4,850,000					13,450,000
Shares granted from re-issued treasury stock, value	$ 74	$ 88	$ 246	$ 415			$ 20	$ 122	$ 0	$ 14	$ 0	$ 42	$ 74	$ 74	$ 246	$ 246	$ 0	$ 0	$ 0	$ 127	$ 127	$ 52	$ 30	$ 173	$ 101	$ 244
Stock Option Awards Under the 2003 Plan [Abstract]
Outstanding options					56,501,000	72,503,000
1993 Stock Option Plan
Outstanding options					56,501,000	72,503,000

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Consolidated Statement of Earnings (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013
Sales	$ 45,161	$ 45,772	$ 155,614	$ 154,920
Cost of sales
Food and paper	15,163	15,422	51,866	51,857
Payroll and related	16,679	16,281	55,399	54,367
Other operating costs	9,752	9,102	32,745	31,961
Costs and expenses	41,594	40,805	140,010	138,185
Gross profit	3,567	4,967	15,604	16,735
Administrative and advertising	2,846	2,695	9,443	10,109
Franchise fees and other revenue	(293)	(306)	(1,076)	(1,057)
Loss on sale of assets	0	0	(67)	14
Impairment of long-lived assets	0	0	0	71
Operating profit	1,014	2,578	7,304	7,598
Interest expense	120	209	471	759
Earnings from continuing operations before income taxes	894	2,369	6,833	6,839
Tax benefit	(691)	621	972	2,133
Earnings from continuing operations	1,585	1,748	5,861	4,706
Loss from discontinued operations, net of tax	0	0	0	(158)
NET EARNINGS (LOSS)	$ 1,585	$ 1,748	$ 5,861	$ 4,548
Basic net earnings per share:
Earnings from continuing operations	$ 0.31	$ 0.35	$ 1.15	$ 0.94
(Loss) from discontinued operations	$ 0.00	$ 0.00	$ 0.00	$ (0.03)
Basic net earnings (loss) per share	$ 0.31	$ 0.35	$ 1.15	$ 0.91
Diluted net earnings per share:
Earnings from continuing operations	$ 0.31	$ 0.34	$ 1.15	$ 0.93
(Loss) from discontinued operations	$ 0.00	$ 0.00	$ 0.00	$ (0.03)
Diluted net earnings (loss) per share	$ 0.31	$ 0.34	$ 1.15	$ 0.90

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Shareholders' Equity/Capital Stock - Earnings Per Share (Details)	3 Months Ended		9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013
Weighted Average Number of Shares Outstanding, Basic [Abstract]
Number of shares issued, Basic	5,094,567	5,062,455	5,083,516	5,021,517
Weighted Average Number Diluted Shares Outstanding Adjustment [Abstract]
Number of diluted shares outstanding adjustment	16,659	10,092	13,777	17,832
Weighted Average Number of Shares Outstanding, Diluted [Abstract]
Number of shares outstanding, diluted	5,111,226	5,072,547	5,097,293	5,039,349
Stock Options
Weighted Average Number of Shares Outstanding, Diluted [Abstract]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	6,834,000	36,000,000	6,834,000	8,000,000

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Consolidated Balance Sheet (Parenthetical) (USD $)	Dec. 10, 2013	May 28, 2013
Statement of Financial Position [Abstract]
Preferred stock, shares authorized	3,000,000	3,000,000
Preferred stock, no par value
Preferred stock, shares issued		0
Common stock, shares authorized	12,000,000	12,000,000
Common stock, no par value
Common stock, shares issued	7,586,764	7,586,764
Common stock, stated value	$ 1	$ 1
Treasury stock, shares	2,487,752	2,524,309

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Long-Term Debt - (Narrative) (Details) (USD $)	9 Months Ended			3 Months Ended
	Mar. 04, 2014	May 28, 2013	Mar. 04, 2014 Long-term Debt, Stock Repurchase Loan [Member]	Mar. 04, 2014 Construction Phase Loan Converted to Term Loans	Sep. 17, 2013 Construction Phase Loan Converted to Term Loans
Debt Instrument [Line Items]
Outstanding loan balance	$ 10,583,000	$ 14,446,000	$ 648,000	$ 6,685,000	$ 11,812,000
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months	2,174,000	4,846,000	141,000	2,033,000
Weighted average interest rate				3.87%
Principal and interest payments				210,000
Debt Covenants [Abstract]
Loan covenant compliance	The Company was in compliance with all loan covenants
Long-term Debt, Other Disclosures [Abstract]
Term Loans under the Consruction Loan, Carrying Value				6,685,000
Term Loans under the Consruction Loan, Fair Value				$ 6,820,000

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Accrued Expenses Accrued Expenses (Tables)

9 Months Ended

Mar. 04, 2014

Payables and Accruals [Abstract]

Accrued expenses in the consolidated balance sheet

Accrued expenses in the Condensed Consolidated Balance Sheet consist of the following:

	March 4, 2014		May 28, 2013
	(in thousands)
Salaries, wages and related expenses	$	4,494	$	4,513
Accrued incentive compensation and related expenses	922		1,216
Accrued property taxes	1,470		1,769
Other accrued expenses	669		527
Total accrued expenses	$	7,555	$	8,025

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Leased Property - Capital Leases (Details) (USD $) In Thousands, unless otherwise specified	Mar. 04, 2014	May 28, 2013
Capital Leases, Lessee Balance Sheet [Abstract]
Capitalized assets balance, gross	$ 2,603	$ 2,603

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Pension Plans Pension Plans (Tables)

9 Months Ended

Mar. 04, 2014

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

Net periodic pension cost components

Net periodic pension cost for the retirement plans is shown in the table that follows:

	40 weeks ended						12 weeks ended
Net periodic pension cost components	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands)
Service cost	$	1,248		$	1,387		$	374		$	416
Interest cost	1,397			1,334			419			400
Expected return on plan assets	(1,859		)	(1,535		)	(558		)	(460		)
Amortization of prior service (credit) cost	(6		)	(6		)	(2		)	(2		)
Recognized net actuarial loss	654			1,317			196			395
Net periodic pension cost	$	1,434		$	2,497		$	429		$	749
Weighted average discount rate	4.40		%	4.25		%	4.40		%	4.25		%
Weighted average rate of compensation increase	4.00		%	4.00		%	4.00		%	4.00		%
Weighted average expected long-term rate of return on plan assets	7.25		%	7.50		%	7.25		%	7.50		%

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Consolidated Statement of Shareholders' Equity (USD $) In Thousands	Total	Common Stock At $1 Per Share - Shares And Amount	Additional Contributed Capital	Accumulated Other Comprehensive Income (Loss)	Retained Earnings	Treasury Shares
Balance at May. 28, 2013	$ 83,656	$ 7,587	$ 69,408	$ (4,324)	$ 50,925	$ (39,940)
Net earnings for 40 weeks	5,861	0	0	0	5,861	0
Other comprehensive income, net of tax	428	0	0	428	0	0
Stock options exercised	172	0	(26)	0	0	198
Excess tax benefit from stock options exercised	24	0	24	0	0	0
Stock-based compensation cost	246	0	246	0	0	0
Treasury shares acquired	(105)	0	0	0	0	(105)
Other treasury shares re-issued	286	0	(180)	0	0	466
Employee stock purchase plan	(36)		(36)
Cash dividends - $0.52 per share	(2,643)	0	0	0	(2,643)	0
Balance at Mar. 04, 2014	$ 87,889	$ 7,587	$ 69,436	$ (3,896)	$ 54,143	$ (39,381)

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Consolidated Statement of Comprehensive Income (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013
NET EARNINGS (LOSS)	$ 1,585	$ 1,748	$ 5,861	$ 4,548
Other comprehensive income
Amortization of amounts included in net periodic pension expense	194	394	648	1,311
Tax effect	(66)	(134)	(220)	(446)
Total other comprehensive income (1)	128	260	428	865
Comprehensive income (loss)	$ 1,713	$ 2,008	$ 6,289	$ 5,413

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Other Comprehensive Income

9 Months Ended

Mar. 04, 2014

Equity [Abstract]

OTHER COMPREHENSIVE INCOME

The following table summarizes items reclassified out of accumulated other comprehensive income and the related tax effects for the components of net periodic pension cost:

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands)
Amortization of pretax amounts included in net periodic pension expense (1)
Included in Cost of Sales	$	611		$	1,247		$	183		$	375
Included in Administrative and Advertising Expense	37			64			11			19
Total reclassification (pretax) (1)	648			1,311			194			394
Tax benefit	(220		)	(446		)	(66		)	(134		)
Total reclassification (net of tax)	$	428		$	865		$	128		$	260

(1) These amounts are included in the computation of net periodic pension expense as a net of the two components (See NOTE F - PENSION PLANS) as shown below:

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands)
Amortization of prior service (credit) cost	$	(6	)	$	(6	)	$	(2	)	$	(2	)
Recognized net actuarial loss	654			1,317			196			396
Total reclassification (pretax)	$	648		$	1,311		$	194		$	394

The following table summarizes changes in accumulated other comprehensive loss (all of which is from Company sponsored pension plans), net of tax, for the 40 week period ended March 4, 2014:

Accumulated Other Comprehensive Loss	March 4, 2014
	(in thousands)
Balance in Accumulated Other Comprehensive Loss on May 28, 2013	$	4,324
Amount reclassified from accumulated other comprehensive income	(428		)
Net other comprehensive (income) loss	(428		)
Balance in Accumulated Other Comprehensive Loss on March 4, 2014	$	3,896

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Document And Entity Information	9 Months Ended
	Mar. 04, 2014
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 04, 2014
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2014
Entity Registrant Name	FRISCHS RESTAURANTS INC
Entity Central Index Key	0000039047
Current Fiscal Year End Date	--06-03
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding	5,099,012

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Accounting Policies Accounting (Policies)

9 Months Ended

Mar. 04, 2014

Accounting Policies [Abstract]

Consolidation Practices

The accompanying interim Condensed Consolidated Financial Statements (unaudited) include the accounts of the Company, prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures included normally in financial statements prepared in accordance with United States Generally Accepted Accounting Principles (US GAAP) have been condensed or omitted as permitted under such rules and regulations. However, management believes that the disclosures made are adequate to make the information not misleading when read in conjunction with the Consolidated Financial Statements and the notes thereto that were included in the Company's Annual Report on Form 10-K for the year ended May 28, 2013.

Significant inter-company accounts and transactions have been eliminated in consolidation. In the opinion of management, all adjustments (all of which were normal and recurring) necessary for a fair presentation of the accompanying unaudited Interim Condensed Consolidated Financial Statements have been made for all periods presented. Additionally, all of the dollar amounts referenced in the text of the footnotes are reported in thousands.

Fiscal Year

Fiscal Year

The current fiscal year will end on Tuesday, June 3, 2014 (Fiscal Year 2014), a period of 53 weeks (which will include a 13 week fourth quarter). The year that ended May 28, 2013 (Fiscal Year 2013) was a 52 week year. The Third Quarter of Fiscal 2014 consists of the 12 weeks ended March 4, 2014. It compares with the 12 weeks ended March 5, 2013, which constituted the Third Quarter of Fiscal 2013. The Three Quarters Ended March 4, 2014 was a period of 40 weeks. It compares with the Three Quarters Ended March 5, 2013, which was also a period of 40 weeks. The 12 week third quarter of each fiscal year should not be considered indicative of results for a full year, because it spans most of the winter season from mid-December through early March.

Revenue Recognition, Rebates [Policy Text Block]

Rebates

Cash rebates received from vendors are recorded as a reduction of cost of sales in the periods in which they are earned. Cash received in advance of the period of recognition is recorded as a liability on the balance sheet.

Impairment of Long-Lived Assets

Impairment of Long-Lived Assets

There were no non-cash impairment losses recorded during the Three Quarters Ended March 4, 2014.

Non-cash impairment losses from continuing operations totaling $71 were recorded during the 40 week period ended March 5, 2013

Goodwill and Other Intangible Assets, Including Licensing Agreements

Goodwill and Other Intangible Assets

An analysis of Goodwill and Other Intangible Assets follows:

	March 4, 2014		May 28, 2013
	(in thousands)
Goodwill	$	741	$	741
Other intangible assets not subject to amortization	22		22
Other intangible assets subject to amortization - net	10		12
Total goodwill and other intangible assets	$	773	$	775

Income Taxes

Income Taxes - Discrete Items

Management periodically assesses the realization of net deferred tax assets based on historical, current and future (expected) operating results. A valuation allowance is recorded if management believes the Company's net deferred tax assets will not be realized ultimately. In addition, all valuation allowances are monitored closely by management, which may consider releasing such allowances in the future based on any positive evidence that may become available that would indicate that the deferred tax asset may be realized ultimately.

New Accounting Pronouncements

New Accounting Pronouncements

ASU 2013-02, "Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive income," was issued in February 2013 to amend Accounting Standards Codification Topic 220, "Comprehensive Income." The amendment does not change the current requirements for reporting net income or other comprehensive income in financial statements, but requires disclosure about amounts reclassified out of accumulated other comprehensive income (AOCI), by component. The amendment requires disclosure of the effect of significant reclassifications out of AOCI on the respective line items in net income in which the item was reclassified if the amount being reclassified is required to be reclassified to net income in its entirety in the same reporting period. It requires a cross reference to other disclosures that provide additional detail for amounts that are not required to be reclassified in their entirety in the same reporting period.

ASU 2013-02 is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2012. This new disclosure became effective for the Company on May 29, 2013 (the first day of Fiscal Year 2014), and has been adopted in accordance with the standard. See NOTE H - OTHER COMPREHENSIVE INCOME to the Condensed Consolidated Financial Statements for the new disclosures related to the adoption of this standard.

The Company reviewed all other significant newly issued accounting pronouncements and concluded that they are either not applicable to the Company’s business or that no material effect is expected on the financial statements as a result of future adoption.

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Consolidated Statement of Comprehensive Income (Parenthetical) (USD $) In Thousands, unless otherwise specified	4 Months Ended
	Sep. 18, 2012 Golden Corral, segment
Total other comprehensive income (1)

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Long-Term Debt

9 Months Ended

Mar. 04, 2014

Debt Disclosure [Abstract]

LONG-TERM DEBT

Long term debt consists of the following maturities as of March 4, 2014:

	March 4, 2014		May 28, 2013
	(in thousands)
Current maturities	$	2,174	$	4,846	Current maturities
March 2016	$	1,712	$	3,652	May 2015
March 2017	4,851		2,721		May 2016
March 2018	1,335		1,654		May 2017
March 2019	511		1,235		May 2018
Subsequent to March 2019	—		338		Subsequent to May 2018
Long-term maturities	$	8,409	$	9,600	Long-term maturities
Total long-term debt	$	10,583	$	14,446	Total long-term debt

Loan Agreement

Borrowing authority under the Company's 2012 Loan Agreement expired on October 15, 2013. A new three year loan agreement was entered on October 31, 2013 (2013 Loan Agreement) with the same lender. The terms of the 2013 Loan Agreement are set forth below in the various components.

Construction Loan

The purpose of the Construction Loan is to finance the construction and opening and/or refurbishing of Frisch's Big Boy Restaurants. Consistent with the previous agreement, funds borrowed must be converted to a Term Loan within six months.

At the time the 2013 Loan Agreement was executed, the aggregate outstanding balance under the Construction Loan was $11,812, which consisted entirely of Term Loans. On October 31, 2013, the Company paid $3,835 to retire six of the Construction Term Loans, incurring minimal prepayment penalties in the process. The payment was sourced from $1,835 in cash and $2,000 that was borrowed under the Revolving Loan (see below).

As of March 4, 2014, the Company had no borrowings in the Construction Phase, and the aggregate outstanding balance of Construction Term Loans totaled $6,685 ($2,033 is included in current maturities), which is included in the above table. The remaining term loans are governed by existing Term Loan promissory notes. The outstanding Term Loans are subject to fixed interest rates, the weighted average of which is 3.87 percent. These Term Loans are being repaid in equal monthly installments of principal and interest aggregating $210, expiring at various dates ranging from November 2014 through February 2019.

Under the 2013 Loan Agreement, when funds are borrowed and in the Construction Phase, interest is based on the LIBOR Rate Margin, plus the one, two, or three month LIBOR rate, as selected by the Company. Under the 2013 Loan Agreement, $5,000 is available for construction financing through October 31, 2016. At the lender's discretion, the Company may request that the facility be increased up to $15,000 at any time. The Company is required to pay the lender an unused credit fee in an amount equal to 0.25 percent per annum on the unused Construction Loan amount.

Revolving Loan

The purpose of the Revolving Loan is to fund working capital needs and for other corporate purposes. Under the 2013 Loan Agreement, the lender's commitment was increased from $5,000 to $11,000. Interest accrues on each advance at an annual rate equal to the LIBOR Rate Margin plus the one month LIBOR rate, currently 1.50 percent. The effective interest rate from the date of inception, October 31, 2013, through March 4, 2014, was 1.51%. The effective interest rate for the 12 weeks ending March 4, 2014, was 1.51%.The Company is required to pay the lender an unused credit fee equal to 0.25 percent percent per annum on the unused Revolving Loan amount. The amount outstanding under the Revolving Loan was $3,250 as of March 4, 2014.

NOTE C — LONG-TERM DEBT (CONTINUED)

Revolving loans are ordinarily classified as short term. However, unlike the 2012 Loan Agreement, the 2013 Loan Agreement does not require a consecutive day "out-of-debt" period during each fiscal year, and any outstanding balance will not be due and payable until October 31, 2016. Management has evaluated the terms of the 2013 Loan Agreement and determined that all criteria have been satisfied in order to classify the Revolving Loan as long-term debt.

Other Components

For a description of the Stock Repurchase Loan and the 2009 Term Loan, refer to NOTE C - LONG TERM DEBT in the Notes to Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended May 28, 2013. No changes have been made to the terms or the required monthly payments of the Stock Repurchase Loan in connection with the 2013 Loan Agreement. The outstanding balance of the Stock Repurchase Loan was $648 as of March 4, 2014 ($141 is included in current maturities). The final payment on the 2009 Term Loan was made on October 21, 2013.

Loan Covenants

The 2013 Loan Agreement contains covenants relating to the relationship of Senior Bank Debt and Earnings Before Income Taxes, Depreciation and Amortization (EBITDA) and minimum required levels of EBITDA , lease expense, asset dispositions, investments and restrictions on pledging certain restaurant operating assets. The Company was in compliance with all loan covenants as of March 4, 2014. Compensating balances are not required under the terms of the 2013 Loan Agreement.

Fair Values

The fair values of the fixed rate Term Loans within the Construction Loan as shown in the following table are based on fixed rates that would have been available at March 4, 2014 if the loans could have been refinanced with terms similar to the remaining terms under the present Term Loans. The carrying value of substantially all other long-term debt approximates its fair value.

	Carrying Value		Fair Value
	(in thousands)
Term Loans under the Construction Loan	$	6,685	$	6,820

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Discontinued Operations

9 Months Ended

Mar. 04, 2014

Discontinued Operations and Disposal Groups [Abstract]

DISCONTINUED OPERATIONS

As of March 4, 2014 (end of the Third Quarter Fiscal 2014) there were no assets or liabilities remaining on the Condensed Consolidated Balance Sheet that relate to the Golden Corral restaurants that were sold in May 2012 to Golden Corral Corporation. Loss from discontinued operations reported in the Condensed Consolidated Statement of Earnings for the 40 weeks ended March 5, 2013 included a charge against income tax expense of $158 representing adjustments to tax related balance sheet accounts. This charge occurred in the First Quarter Fiscal 2013; there were no charges to Discontinued Operations in any other quarter during Fiscal Year 2013.

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Shareholders' Equity/Capital Stock Shareholder's Equity/Capital Stock (Tables)

9 Months Ended

Mar. 04, 2014

Share-based Compensation [Abstract]

Schedule of stock options activity

The changes in outstanding and exercisable options under both the 1993 Stock Option Plan (1993 Plan) and the 2003 Stock Option and Incentive Plan (2003 Plan) are shown below as of March 4, 2014:

	No. of shares		Weighted avg. price per share		Weighted avg. Remaining Contractual Term		Aggregate Intrinsic Value (in thousands)
Outstanding at beginning of year	72,503		$	18.07
Granted	—		$	—
Exercised	(12,502	)	$	13.84
Forfeited or expired	(3,500	)	$	22.56
Outstanding at end of quarter	56,501		$	18.73	3.29	years	$	338
Exercisable at end of quarter	56,501		$	18.73	3.29	years	$	338

Schedule of stock optiony exercise price range

Schedule of restricted stock activity

Schedule of weighted average number of shares

Basic earnings per share (EPS) calculations are based on the weighted average number of outstanding common shares during the period presented. Diluted EPS includes the effect of common stock equivalents, which assumes the exercise and conversion of dilutive stock options.

	Used to Calculate Basic EPS	Stock equivalents	Used to Calculate Diluted EPS
40 weeks ended:	Weighted average shares outstanding		Weighted average shares outstanding
March 4, 2014	5,083,516	13,777	5,097,293
March 5, 2013	5,021,517	17,832	5,039,349
12 weeks ended:
March 4, 2014	5,094,567	16,659	5,111,226
March 5, 2013	5,062,455	10,092	5,072,547

Schedule of share-based compensation expense

Share-Based Payment (Compensation Cost)

The fair value of restricted stock issued (one year vesting) and stock options granted (three year vesting) is recognized as compensation cost on a straight-line basis over the vesting periods of the awards. The fair value of unrestricted stock awarded under the 2003 Plan was recognized entirely during the period granted ($127 in June 2012 - 4,850 shares). Compensation costs arising from all share-based payments are charged to administrative and advertising expense in the Condensed Consolidated Statement of Earnings.

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands, except earnings per share)
Stock options granted	$	—		$	42		$	—		$	14
Restricted stock issued	246			246			74			74
Unrestricted stock issued	—			127			—			—
Share-based compensation cost, pretax	246			415			74			88
Tax benefit	(84		)	(141		)	(25		)	(30		)
Share-based compensation cost, net of tax	$	162		$	274		$	49		$	58
Effect on basic earnings per share	$	0.03		$	0.05		$	0.01		$	0.01
Effect on diluted earnings per share	$	0.03		$	0.05		$	0.01		$	0.01

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Accounting Policies Accounting Policies (Tables)

9 Months Ended

Mar. 04, 2014

Accounting Policies [Abstract]

Schedule of goodwill and other intangible assets

An analysis of Goodwill and Other Intangible Assets follows:

	March 4, 2014		May 28, 2013
	(in thousands)
Goodwill	$	741	$	741
Other intangible assets not subject to amortization	22		22
Other intangible assets subject to amortization - net	10		12
Total goodwill and other intangible assets	$	773	$	775

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Pension Plans

9 Months Ended

Mar. 04, 2014

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

PENSION PLANS

NOTE F - PENSION PLANS

The Company sponsors a qualified defined benefit pension plan (DB Plan) plus an unfunded non-qualified Supplemental Executive Retirement Plan (SERP) for “highly compensated employees” (HCE’s). Net periodic pension cost for the retirement plans is shown in the table that follows:

	40 weeks ended						12 weeks ended
Net periodic pension cost components	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands)
Service cost	$	1,248		$	1,387		$	374		$	416
Interest cost	1,397			1,334			419			400
Expected return on plan assets	(1,859		)	(1,535		)	(558		)	(460		)
Amortization of prior service (credit) cost	(6		)	(6		)	(2		)	(2		)
Recognized net actuarial loss	654			1,317			196			395
Net periodic pension cost	$	1,434		$	2,497		$	429		$	749
Weighted average discount rate	4.40		%	4.25		%	4.40		%	4.25		%
Weighted average rate of compensation increase	4.00		%	4.00		%	4.00		%	4.00		%
Weighted average expected long-term rate of return on plan assets	7.25		%	7.50		%	7.25		%	7.50		%

Net periodic pension cost for Fiscal Year 2014 is currently expected to approximate $1,864. Net periodic pension cost for Fiscal Year 2013 was $3,247. The primary driver of the 42 percent decrease over Fiscal Year 2013 is the actual return on Plan assets during Fiscal Year 2013, which exceeded the expected return on Plan assets by $4,296. The higher discount rate and data updates also contributed to the decrease, but to a lesser degree.

Although there are no minimum required contributions to the DB Plan for the plan year ending May 31, 2014, management currently anticipates contributing up to $2,000 over the course of Fiscal Year 2014, including $1,200 that was contributed during 40 weeks ended March 4, 2014.

Frisch's Executive Savings Plan

Fair value measurements are used for recording the assets in the Frisch's Executive Savings Plan (FESP). FESP assets are the principal component of "Other long-term assets" in the Condensed Consolidated Balance Sheet. Assets of the plan are grouped into a three-level hierarchy for valuation techniques used to measure the fair values of the assets. These levels are:

• Level 1 - Quoted prices in active markets for identical assets.

• Level 2- Observable inputs other than Level 1 prices, such as quoted prices for similar assets, quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data by correlation or other means.

• Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets.

NOTE F - PENSION PLANS (CONTINUED)

The fair values of all FESP assets are determined based on quoted market prices and are classified within Level 1 of the fair value hierarchy:

	March 4, 2014		May 28, 2013
	(in thousands)
	Level 1		Level 1
Money market funds	$	432	$	45
Mutual funds	1,771		1,310
Foreign equity mutual funds	242		287
Taxable bond mutual funds	534		798
Large blend target date mutual funds	497		414
Total	$	3,476	$	2,854

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Accrued Expenses

9 Months Ended

Mar. 04, 2014

Payables and Accruals [Abstract]

ACCRUED EXPENSES

Accounts payable in the Condensed Consolidated Balance Sheet consist of the following:

	March 4, 2014		May 28, 2013
	(in thousands)
Trade and other accounts payable	$	4,728	$	3,574
Taxes - sales and use, payroll tax withheld from employees	1,469		581
Utilities	578		621
Gift cards and coupons	950		748
Miscellaneous employee withholding	230		355
Total accounts payable	$	7,955	$	5,879

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Shareholders' Equity/Capital Stock

9 Months Ended

Mar. 04, 2014

Share-based Compensation [Abstract]

SHAREHOLDERS' EQUITY/CAPITAL STOCK

Outstanding and Exercisable Options

The changes in outstanding and exercisable options under both the 1993 Stock Option Plan (1993 Plan) and the 2003 Stock Option and Incentive Plan (2003 Plan) are shown below as of March 4, 2014:

	No. of shares		Weighted avg. price per share		Weighted avg. Remaining Contractual Term		Aggregate Intrinsic Value (in thousands)
Outstanding at beginning of year	72,503		$	18.07
Granted	—		$	—
Exercised	(12,502	)	$	13.84
Forfeited or expired	(3,500	)	$	22.56
Outstanding at end of quarter	56,501		$	18.73	3.29	years	$	338
Exercisable at end of quarter	56,501		$	18.73	3.29	years	$	338

The intrinsic value of stock options exercised during the 40 week periods ended March 4, 2014 and March 5, 2013 amounted to $127 and $2,779, respectively. The intrinsic value of stock options exercised during the 12 week period ended March 4, 2014 amounted to $68. No stock options were exercised during the 12 week period ended March 5, 2013.

Dividends

Regular quarterly cash dividends paid to shareholders during the 40 week period ended March 4, 2014 amounted to $2,643 or $0.52 per share. In addition, an $0.18 per share dividend was declared on March 13, 2014. Its payment of approximately $918 on April 10, 2014 (not included in accounts payable at March 4, 2014) will be the 213th consecutive quarterly cash dividend (a period of 53 years) paid by the Company.

Earnings Per Share

Basic earnings per share (EPS) calculations are based on the weighted average number of outstanding common shares during the period presented. Diluted EPS includes the effect of common stock equivalents, which assumes the exercise and conversion of dilutive stock options.

	Used to Calculate Basic EPS	Stock equivalents	Used to Calculate Diluted EPS
40 weeks ended:	Weighted average shares outstanding		Weighted average shares outstanding
March 4, 2014	5,083,516	13,777	5,097,293
March 5, 2013	5,021,517	17,832	5,039,349
12 weeks ended:
March 4, 2014	5,094,567	16,659	5,111,226
March 5, 2013	5,062,455	10,092	5,072,547

Excluded from the calculations above (because the effect was anti-dilutive), were stock options to purchase 6,834 shares during the 40 week period ended March 4, 2014 and 8,000 during the 40 week period ended March 5, 2013. Stock options to purchase 6,834 shares during the 12 week period ended March 4, 2014 and 36,000 in the 12 weeks ended March 5, 2013 were also excluded from the calculations above because the effect was anti-dilutive.

Share-Based Payment (Compensation Cost)

The fair value of restricted stock issued (one year vesting) and stock options granted (three year vesting) is recognized as compensation cost on a straight-line basis over the vesting periods of the awards. The fair value of unrestricted stock awarded under the 2003 Plan was recognized entirely during the period granted ($127 in June 2012 - 4,850 shares). Compensation costs arising from all share-based payments are charged to administrative and advertising expense in the Condensed Consolidated Statement of Earnings.

	40 weeks ended						12 weeks ended
	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
	(in thousands, except earnings per share)
Stock options granted	$	—		$	42		$	—		$	14
Restricted stock issued	246			246			74			74
Unrestricted stock issued	—			127			—			—
Share-based compensation cost, pretax	246			415			74			88
Tax benefit	(84		)	(141		)	(25		)	(30		)
Share-based compensation cost, net of tax	$	162		$	274		$	49		$	58
Effect on basic earnings per share	$	0.03		$	0.05		$	0.01		$	0.01
Effect on diluted earnings per share	$	0.03		$	0.05		$	0.01		$	0.01

There was no unrecognized pretax compensation cost related to non-vested stock options as of March 4, 2014. Unrecognized pretax compensation cost related to restricted stock awards amounted to $197 as of March 4, 2014, which is expected to be recognized over a weighted average period of 0.62 years.

Unrestricted stock awarded under the 2012 Stock Option and Incentive Plan ($244 in June 2013 - 13,450 shares) was accrued as incentive compensation in Fiscal Year 2013, including $101 and $30 respectively, during the 40 and 12 week period ended March 5, 2013. Incentive compensation for unrestricted stock is also being accrued in Fiscal Year 2014 - $173 through the 40 week period ended March 4, 2014 and $52 during the 12 week period ended March 4, 2014.

Compensation cost is also recognized in connection with the Company’s Employee Stock Purchase Plan. Compensation costs related to the Employee Stock Purchase Plan are determined at the end of each semi-annual offering period: October 31 and April 30, which amounted to $20 and $122 respectively, at October 31, 2013 (40 week period ended March 4, 2014) and October 31, 2012 (40 week period ended March 5, 2013).

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Commitments And Contingencies

9 Months Ended

Mar. 04, 2014

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

Litigation

Employees, customers and other parties bring various claims and lawsuits against the Company from time to time in the ordinary course of business. Claims made by employees are subject to workers' compensation insurance or are covered generally by employment practices liability insurance. Claims made by customers are covered by general and product liability insurance. All insurance policies are subject to retention and coverage limits. Exposure to loss contingencies from pending or threatened litigation is evaluated continually by management, which believes at the present time that the resolution of claims currently outstanding, whether or not covered by insurance, will not result in a material adverse effect upon the Company's earnings, cash flows or financial position. Adequate provisions for expected losses not covered by insurance have been included in the Condensed Consolidated Financial Statements.

Contingent Liabilities

The Company remains contingently liable under certain ground lease agreements relating to land on which seven of the Company's former Golden Corral restaurants are situated. The seven leases were assigned to Golden Corral Corporation (GCC) as part of the May 2012 transaction to sell the restaurants to GCC. The amount remaining under contingent lease obligations totaled approximately$6,436 as of March 4, 2014, for which the aggregate average annual lease payments approximate $665 in each of the next five years. Since there is no reason to believe that GCC (the owner and franchisor of the Golden Corral brand) is likely to default, no provision has been made in the Condensed Consolidated Financial Statements for amounts that would be payable by the Company.

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Long-Term Debt - Maturities of Long-term Debt (Details) (USD $)	Mar. 04, 2014	May 28, 2013	Mar. 04, 2014 Long-term Debt, Stock Repurchase Loan [Member]	Mar. 04, 2014 Construction Phase Loan Converted to Term Loans	Sep. 17, 2013 Construction Phase Loan Converted to Term Loans
Long-term Debt, Fiscal Year Maturity [Abstract]
2014	$ 2,174,000	$ 4,846,000	$ 141,000	$ 2,033,000
2015	1,712,000	3,652,000
2016	4,851,000	2,721,000
2017	1,335,000	1,654,000
2018	511,000	1,235,000
Subsequent to 2018	0	338,000
Total long-term debt	8,409,000	9,600,000
Outstanding loan balance	$ 10,583,000	$ 14,446,000	$ 648,000	$ 6,685,000	$ 11,812,000

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Other Comprehensive Income - Changes in Accumulated Other Comprehensive Income (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Mar. 04, 2014
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance in Accumulated Other Comprehensive Loss on May 28, 2013	$ 4,324
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax [Abstract]
Net other comprehensive (income) loss	428
Balance in Accumulated Other Comprehensive Loss on March 4, 2014	3,896
Pension plans
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance in Accumulated Other Comprehensive Loss on May 28, 2013	4,324
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax [Abstract]
Amount reclassified from accumulated other comprehensive income	(428)
Net other comprehensive (income) loss	428
Balance in Accumulated Other Comprehensive Loss on March 4, 2014	$ 3,896

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Long-Term Debt (Tables)

9 Months Ended

Mar. 04, 2014

Debt Disclosure [Abstract]

Schedule of maturities of long-term debt

Long term debt consists of the following maturities as of March 4, 2014:

	March 4, 2014		May 28, 2013
	(in thousands)
Current maturities	$	2,174	$	4,846	Current maturities
March 2016	$	1,712	$	3,652	May 2015
March 2017	4,851		2,721		May 2016
March 2018	1,335		1,654		May 2017
March 2019	511		1,235		May 2018
Subsequent to March 2019	—		338		Subsequent to May 2018
Long-term maturities	$	8,409	$	9,600	Long-term maturities
Total long-term debt	$	10,583	$	14,446	Total long-term debt

Schedule of carrying values and estimated fair values of debt instruments

Fair Values

The fair values of the fixed rate Term Loans within the Construction Loan as shown in the following table are based on fixed rates that would have been available at March 4, 2014 if the loans could have been refinanced with terms similar to the remaining terms under the present Term Loans. The carrying value of substantially all other long-term debt approximates its fair value.

	Carrying Value		Fair Value
	(in thousands)
Term Loans under the Construction Loan	$	6,685	$	6,820

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Accounting Policies - Narrative (Details) (USD $)	3 Months Ended		9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013	May 28, 2013
Receivables [Abstract]
Receivables reserve balance					$ 30,000
Impairment of Long-Lived Assets [Abstract]
Impairment of long-lived assets	0	0	0	71,000
Self-Insurance [Abstract]
Increase in self-insured obligations			160,000	(343,000)
Income Taxes [Abstract]
Valuation Allowances and Reserves, Deductions	222,000	0	222,000	(81,000)
Income Tax Expense (Benefit)	(691,000)	621,000	972,000	2,133,000
Two former Frisch's Big Boy restaurants
Impairment of Long-Lived Assets [Abstract]
Impairment of long-lived assets				$ 71,000

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Commitments And Contingencies Commitments and Contingencies (Details) (Golden Corral, disposal group, Properties operated under operating lease agreement with contingent rental payments, USD $)	Mar. 04, 2014
Golden Corral, disposal group | Properties operated under operating lease agreement with contingent rental payments
Other Contingencies
Total lease obligation, for which Company is contingently liable for performance	$ 6,436,000
Annual lease obligation, for which Company is contingently liable for performance	$ 665,000

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Shareholders' Equity/Capital Stock - Stock Options (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Mar. 04, 2014	Mar. 05, 2013	Mar. 04, 2014	Mar. 05, 2013
1993 Plan and 2003 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value	$ 0		$ 127	$ 2,779
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding at beginning of year			72,503,000
Granted			0
Exercised			(12,502,000)
Forfeited or expired			(3,500,000)
Outstanding at end of quarter	56,501,000		56,501,000
Exercisable at end of quarter	56,501,000		56,501,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]
Outstanding at beginning of year			$ 18.07
Granted	$ 0.00
Exercised			$ 13.84
Forfeited or expired			$ 22.56
Outstanding at end of quarter	$ 18.73		$ 18.73
Exercisable at end of quarter	$ 18.73		$ 18.73
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Outstanding at end of quarter, Weighted Avg. Remaining Contractual Term	3 years 3 months 15 days
Exercisable at end of quarter, Weighted Avg. Remaining Contractual Term	3 years 3 months 15 days
Outstanding at end of quarter, Aggregate Intrinsic Value	338		338
Exercisable at end of quarter, Aggregate Intrinsic Value	$ 338		$ 338
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	6,834,000	36,000,000	6,834,000	8,000,000

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Consolidated Balance Sheet (USD $) In Thousands, unless otherwise specified	Mar. 04, 2014	May 28, 2013
Current Assets
Cash and equivalents	$ 1,796	$ 4,256
Trade and other accounts receivables	1,460	1,297
Inventories	6,403	5,765
Prepaid expenses, sundry deposits and property held for sale	923	686
Prepaid and deferred income taxes	1,716	2,417
Total current assets	12,298	14,421
Property and Equipment
Land and improvements	48,018	45,868
Buildings	76,302	74,173
Equipment and fixtures	84,782	80,735
Leasehold improvements and buildings on leased land	19,248	18,299
Capitalized leases	2,603	2,603
Construction in progress	234	417
Property, plant and equipment, gross, total	231,187	222,095
Less accumulated depreciation and amortization	125,563	119,950
Net property and equipment	105,624	102,145
Other Assets
Goodwill and other intangible assets	773	775
Land - deferred development	2,861	3,169
Property held for sale	4,776	5,236
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent	1,073
Deferred Tax Assets, Net of Valuation Allowance, Current		0
Other long term assets	3,681	2,966
Total other assets	13,164	12,146
Total assets	131,086	128,712
Long-term obligations due within one year
Long-term debt	2,174	4,846
Obligations under capitalized leases	244	236
Self insurance	328	275
Accounts payable	7,955	5,879
Accrued expenses	7,555	8,025
Total current liabilities	18,256	19,261
Long-Term Obligations
Long-term debt	8,409	9,600
Obligations under capitalized leases	1,877	2,050
Self insurance	1,267	1,160
Deferred Tax Liabilities, Net, Noncurrent	0	253
Underfunded pension obligation	8,116	8,530
Deferred compensation and other	5,272	4,202
Total long-term obligations	24,941	25,795
Shareholders’ Equity
Preferred stock - authorized, 3,000,000 shares without par value; none issued	0	0
Common stock - authorized, 12,000,000 shares without par value; issued 7,586,764 and 7,586,764 shares - stated value - $1.00	7,587	7,587
Additional contributed capital	69,436	69,408
Preferred stock, common stock, including additional paid in capital, total, value	77,023	76,995
Accumulated other comprehensive loss	(3,896)	(4,324)
Retained earnings	54,143	50,925
Retained earnings and accumulated other comprehensive income	50,247	46,601
Less cost of treasury stock (2,538,053 and 2,648,158 shares)	39,381	39,940
Total shareholders' equity	87,889	83,656
Total liabilities and shareholders' equity	$ 131,086	$ 128,712

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Accounting Policies

9 Months Ended

Mar. 04, 2014

Accounting Policies [Abstract]

ACCOUNTING POLICIES

Interim Financial Statements and Principles of Consolidation

The accompanying interim Condensed Consolidated Financial Statements (unaudited) include the accounts of the Company, prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures included normally in financial statements prepared in accordance with United States Generally Accepted Accounting Principles (US GAAP) have been condensed or omitted as permitted under such rules and regulations. However, management believes that the disclosures made are adequate to make the information not misleading when read in conjunction with the Consolidated Financial Statements and the notes thereto that were included in the Company's Annual Report on Form 10-K for the year ended May 28, 2013.

Significant inter-company accounts and transactions have been eliminated in consolidation. In the opinion of management, all adjustments (all of which were normal and recurring) necessary for a fair presentation of the accompanying unaudited Interim Condensed Consolidated Financial Statements have been made for all periods presented. Additionally, all of the dollar amounts referenced in the text of the footnotes are reported in thousands.

Reclassifications

Certain amounts reported in the prior year have been reclassified to conform to the current year presentation.

Fiscal Year

The current fiscal year will end on Tuesday, June 3, 2014 (Fiscal Year 2014), a period of 53 weeks (which will include a 13 week fourth quarter). The year that ended May 28, 2013 (Fiscal Year 2013) was a 52 week year. The Third Quarter of Fiscal 2014 consists of the 12 weeks ended March 4, 2014. It compares with the 12 weeks ended March 5, 2013, which constituted the Third Quarter of Fiscal 2013. The Three Quarters Ended March 4, 2014 was a period of 40 weeks. It compares with the Three Quarters Ended March 5, 2013, which was also a period of 40 weeks. The 12 week third quarter of each fiscal year should not be considered indicative of results for a full year, because it spans most of the winter season from mid-December through early March.

Rebates

Cash rebates received from vendors are recorded as a reduction of cost of sales in the periods in which they are earned. Cash received in advance of the period of recognition is recorded as a liability on the balance sheet.

Impairment of Long-Lived Assets

There were no non-cash impairment losses recorded during the Three Quarters Ended March 4, 2014.

Non-cash impairment losses from continuing operations totaling $71 were recorded during the 40 week period ended March 5, 2013 (during the First Quarter). The $71 aggregate impairment charge lowered previous estimates of the fair values of two former Frisch's Big Boy restaurants, both of which had been sold as of March 4, 2014 (in May and July 2013).

Goodwill and Other Intangible Assets

An analysis of Goodwill and Other Intangible Assets follows:

	March 4, 2014		May 28, 2013
	(in thousands)
Goodwill	$	741	$	741
Other intangible assets not subject to amortization	22		22
Other intangible assets subject to amortization - net	10		12
Total goodwill and other intangible assets	$	773	$	775

Provision for Income Taxes

The provision for income taxes in all periods presented is based on management’s estimate of the effective tax rate for the entire year, to which the effect of certain discrete items as described below has been applied.

	40 weeks ended						12 weeks ended
Income Tax Expense (Benefit)	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
Effective tax rate (benefit)	22.5		%	30		%	(14.1		)%	26.2		%
	(in thousands)
Effective tax rate - tax expense (benefit)	$	1,537		$	2,052		$	(126	)	$	621
Discrete - valuation allowances (released) placed	(222		)	81			(222		)	—
Discrete - domestic production activities deduction	(343		)	—			(343		)	—
Total income tax expense (benefit)	$	972		$	2,133		$	(691	)	$	621

Income Taxes - Discrete Items

Management periodically assesses the realization of net deferred tax assets based on historical, current and future (expected) operating results. A valuation allowance is recorded if management believes the Company's net deferred tax assets will not be realized ultimately. In addition, all valuation allowances are monitored closely by management, which may consider releasing such allowances in the future based on any positive evidence that may become available that would indicate that the deferred tax asset may be realized ultimately.

During the 12 week period ended March 4, 2014, management developed a plan to restructure the Company's consolidated subsidiaries from corporations to single member limited liability companies. By implementing this plan, management believes future taxable income will be generated in amounts sufficient to realize certain state deferred tax assets, including certain Net Operating Loss (NOL) carryforwards. As a result, the valuation allowances that had been previously placed on these deferred tax assets were released during the 12 week period ended March 4, 2014, the effect of which was to record an income tax benefit of $222. The release of $222 includes $81 that had been placed on certain deferred state income tax assets and included in the tax provision during the Second Quarter of Fiscal 2013.

During the present fiscal year, management has undertaken a project to identify, quantify and document tax benefits associated with the Domestic Production Activities Deduction (DPAD) that are available under the Internal Revenue Code (IRC). Prior to this project, management had not elected to claim DPAD benefits. In February 2014, the Company filed an amended federal income tax return for its 2010 fiscal year to take advantage of DPAD. The expected refund totaling $343, was recorded as an income tax benefit during the 12 week period ended March 4, 2014. Amended federal income tax returns for fiscal years 2011, 2012 and 2013 will be filed in the Fourth Quarter of Fiscal 2014, which will result in the recording of additional tax benefits for DPAD, currently estimated to total between $600 and $700.

The tax benefit to be derived from DPAD in fiscal 2014 has been incorporated into the annual effective tax rate as of the 12 week period ended March 4, 2014.

Income Taxes - Repair Regulations

An automatic Change in Accounting Method (Form 3115) was filed with the Internal Revenue Service (IRS) in fiscal 2011, to allow for immediate deduction of certain repairs and maintenance costs, replacing the previous treatment that had capitalized these costs. Final Repair Regulations were issued by the IRS in September 2013 to replace temporary and proposed repair regulations that had been issued in December 2011. The temporary and proposed repair regulations had departed in some ways from the earlier regulations on which the Company's Change in Accounting Method had been based. The Final Repair Regulations are less of a departure from the earlier regulations than were the temporary and proposed regulations that had been issued in December 2011. The Final Repair Regulations, which specify when costs incurred to acquire, produce or improve tangible property must be capitalized or may be deducted as incurred, must be applied to taxable years beginning on or after January 1, 2014 (the Company's fiscal year 2015). Although still unfavorable, the effect of the Final Repair Regulations on the Company's Change in Accounting Method (filed in fiscal 2011) is expected to be an immaterial timing difference. Once the exact amount is known, (likely in the 4th quarter of fiscal 2014), the appropriate Forms 3115 will be filed with the IRS to conform the previous Change in Accounting Method to the Final Repair Regulations.

New Accounting Pronouncements

ASU 2013-02, "Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive income," was issued in February 2013 to amend Accounting Standards Codification Topic 220, "Comprehensive Income." The amendment does not change the current requirements for reporting net income or other comprehensive income in financial statements, but requires disclosure about amounts reclassified out of accumulated other comprehensive income (AOCI), by component. The amendment requires disclosure of the effect of significant reclassifications out of AOCI on the respective line items in net income in which the item was reclassified if the amount being reclassified is required to be reclassified to net income in its entirety in the same reporting period. It requires a cross reference to other disclosures that provide additional detail for amounts that are not required to be reclassified in their entirety in the same reporting period.

ASU 2013-02 is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2012. This new disclosure became effective for the Company on May 29, 2013 (the first day of Fiscal Year 2014), and has been adopted in accordance with the standard. See NOTE H - OTHER COMPREHENSIVE INCOME to the Condensed Consolidated Financial Statements for the new disclosures related to the adoption of this standard.

The Company reviewed all other significant newly issued accounting pronouncements and concluded that they are either not applicable to the Company’s business or that no material effect is expected on the financial statements as a result of future adoption.

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Accounting Policies - Fiscal Year Dislosures (Details)	3 Months Ended	12 Months Ended
	Dec. 10, 2013	May 29, 2012
Fiscal Year [Abstract]
Number of weeks in the first quarter of each fiscal year period	P16W
Number of weeks in the the last three quarters of each fiscal year period	P12W
52-week fiscal year
Fiscal Year [Abstract]
Number of weeks in a fiscal year period	P52W
Number of weeks in the current fiscal year period	P52W	P52W
53-week fiscal year
Fiscal Year [Abstract]
Number of weeks in a fiscal year period	P53W
Number of weeks in the the fourth quarter of a 53-week fiscal year period	P13W

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Accrued Expenses Accrued Expenses (Details) (USD $) In Thousands, unless otherwise specified	Mar. 04, 2014	May 28, 2013
Payables and Accruals [Abstract]
Salaries, wages and related expenses	$ 4,494	$ 4,513
Accrued Incentive Compensation, Current	922	1,216
Accrued property taxes	1,470	1,769
Other accrued expenses	669	527
Total accrued expenses	$ 7,555	$ 8,025

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Accounting Policies income taxes (Tables)

9 Months Ended

Mar. 04, 2014

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

The provision for income taxes in all periods presented is based on management’s estimate of the effective tax rate for the entire year, to which the effect of certain discrete items as described below has been applied.

	40 weeks ended						12 weeks ended
Income Tax Expense (Benefit)	March 4, 2014			March 5, 2013			March 4, 2014			March 5, 2013
Effective tax rate (benefit)	22.5		%	30		%	(14.1		)%	26.2		%
	(in thousands)
Effective tax rate - tax expense (benefit)	$	1,537		$	2,052		$	(126	)	$	621
Discrete - valuation allowances (released) placed	(222		)	81			(222		)	—
Discrete - domestic production activities deduction	(343		)	—			(343		)	—
Total income tax expense (benefit)	$	972		$	2,133		$	(691	)	$	621

Income Taxes - Discrete Items

Management periodically assesses the realization of net deferred tax assets based on historical, current and future (expected) operating results. A valuation allowance is recorded if management believes the Company's net deferred tax assets will not be realized ultimately. In addition, all valuation allowances are monitored closely by management, which may consider releasing such allowances in the future based on any positive evidence that may become available that would indicate that the deferred tax asset may be realized ultimately.

During the 12 week period ended March 4, 2014, management developed a plan to restructure the Company's consolidated subsidiaries from corporations to single member limited liability companies. By implementing this plan, management believes future taxable income will be generated in amounts sufficient to realize certain state deferred tax assets, including certain Net Operating Loss (NOL) carryforwards. As a result, the valuation allowances that had been previously placed on these deferred tax assets were released during the 12 week period ended March 4, 2014, the effect of which was to record an income tax benefit of $222. The release of $222 includes $81 that had been placed on certain deferred state income tax assets and included in the tax provision during the Second Quarter of Fiscal 2013.

During the present fiscal year, management has undertaken a project to identify, quantify and document tax benefits associated with the Domestic Production Activities Deduction (DPAD) that are available under the Internal Revenue Code (IRC). Prior to this project, management had not elected to claim DPAD benefits. In February 2014, the Company filed an amended federal income tax return for its 2010 fiscal year to take advantage of DPAD. The expected refund totaling $343, was recorded as an income tax benefit during the 12 week period ended March 4, 2014. Amended federal income tax returns for fiscal years 2011, 2012 and 2013 will be filed in the Fourth Quarter of Fiscal 2014, which will result in the recording of additional tax benefits for DPAD, currently estimated to total between $600 and $700.

The tax benefit to be derived from DPAD in fiscal 2014 has been incorporated into the annual effective tax rate as of the 12 week period ended March 4, 2014.

Income Taxes - Repair Regulations

An automatic Change in Accounting Method (Form 3115) was filed with the Internal Revenue Service (IRS) in fiscal 2011, to allow for immediate deduction of certain repairs and maintenance costs, replacing the previous treatment that had capitalized these costs. Final Repair Regulations were issued by the IRS in September 2013 to replace temporary and proposed repair regulations that had been issued in December 2011. The temporary and proposed repair regulations had departed in some ways from the earlier regulations on which the Company's Change in Accounting Method had been based. The Final Repair Regulations are less of a departure from the earlier regulations than were the temporary and proposed regulations that had been issued in December 2011. The Final Repair Regulations, which specify when costs incurred to acquire, produce or improve tangible property must be capitalized or may be deducted as incurred, must be applied to taxable years beginning on or after January 1, 2014 (the Company's fiscal year 2015). Although still unfavorable, the effect of the Final Repair Regulations on the Company's Change in Accounting Method (filed in fiscal 2011) is expected to be an immaterial timing difference. Once the exact amount is known, (likely in the 4th quarter of fiscal 2014), the appropriate Forms 3115 will be filed with the IRS to conform the previous Change in Accounting Method to the Final Repair Regulations.