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Note 3 - Franchise Programs
9 Months Ended
Mar. 01, 2016
Notes to Financial Statements  
Franchise Programs [Text Block]
NOTE 3 –
FRANCHISE PROGRAMS
 
As of March 1, 2016, our domestic and international franchisees collectively operated 80 domestic and international Ruby Tuesday restaurants and eight domestic Lime Fresh restaurants. We do not own any equity interest in our existing franchisees.
 
Under the terms of the franchise operating agreements, we charge a royalty fee (generally 4.0% of monthly gross sales for our Ruby Tuesday concept franchisees and 5.25% of monthly gross sales for our Lime Fresh concept franchisees) and require all domestic franchisees to contribute a percentage, 1.5% as of March 1, 2016, of monthly gross sales to a national advertising fund formed to cover their pro rata portion of the production and airing costs associated with our national advertising campaign. Under the terms of those agreements, we can charge up to 3.0% of monthly gross sales for this national advertising fund.
 
Advertising amounts received from domestic franchisees are considered by RTI to be reimbursements, recorded on an accrual basis as earned, and have been netted against Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive Loss.
 
In addition to the advertising fee discussed above, our Ruby Tuesday concept franchise agreements allow us to charge up to a 2.0% support service fee and a 1.5% marketing and purchasing fee. Our last support services contract expired on June 30, 2015. For the 13 and 39 weeks ended March 1, 2016, we recorded $0.2 million and $0.7 million, respectively, and for the 13 and 39 weeks ended March 3, 2015, we recorded $0.3 million and $1.0 million, respectively, in support service and marketing and purchasing fees, which were an offset to Selling, general and administrative, net in our Condensed Consolidated Statements of Operations and Comprehensive Loss.