Note 2 - Franchise Programs |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 06, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Notes to Financial Statements | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Franchise Programs [Text Block] | 2. Franchise Programs As of June 6, 2017, our franchise programs included arrangements with 22 domestic and international Ruby Tuesday concept franchisees. At the end of fiscal year2017, our franchisees collectively operated 62 Ruby Tuesday restaurants. We do not own any equity interest in our existing franchisees.We enter into development agreements with our franchisees that require them to open varying numbers of Ruby Tuesday restaurants. As of June 6, 2017, seven of our 22 Ruby Tuesday concept franchisees had agreements to develop new franchised Ruby Tuesday restaurants. During fiscal years 2017, 2016, and 2015, our Ruby Tuesday franchisees opened one , five , and six restaurants, respectively, pursuant to development agreements, as follows:
During fiscal years 2016 and 2015, our then Lime Fresh franchisees opened one and two restaurants, respectively, pursuant to development agreements. However, as discussed further in Note 3 to the Consolidated Financial Statements, during the fourth quarter of fiscal year 2016, we sold the Lime Fresh brand's intellectual property and the franchise agreements associated with eight Lime Fresh concept restaurants for $4.6 million. As a result of this transaction, we had no remaining Lime Fresh concept franchisees as of May 31, 2016. In conjunction with these openings, we recognized development and licensing fee income totaling an insignificant amount in fiscal year 2017 and $0.2 2016 and 2015. Deferred development and licensing fees associated with all franchisees, which are reported as a component of Other deferred liabilities in our Consolidated Balance Sheets, totaled $0.3 million and $0.4 million as of June 6, 2017 and May 31, 2016, respectively. We will recognize these fees as income when we have substantially performed all material services and the restaurant has opened for business. |
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