Execution Version

AMENDMENT TO ASSET PURCHASE AGREEMENT
 
This Amendment (the “Amendment”) to the Asset Purchase Agreement, entered into
and dated as of June 23, 2010 (the “Asset Purchase Agreement”), by and among
Luby’s, Inc., a Delaware corporation (“Luby’s”), Fuddruckers, Inc., a Texas
corporation (“Fuddruckers”), Magic Brands, LLC, a Delaware limited liability
company (“Magic”, and together with Fuddruckers, collectively, the “Company”),
Atlantic Restaurant Ventures, Inc., a Virginia corporation (“ARVI,” and together
with each of Magic and Fuddruckers, the “Debtors”), R. Wes, Inc., a Texas
corporation (“R. Wes”), Fuddruckers of Howard County, LLC, a Maryland limited
liability company (“Howard County”), and Fuddruckers of White Marsh, LLC, a
Maryland limited liability company (“White Marsh,” and together with R. Wes and
Howard County, the “Non-Debtor Sellers,” and the Non-Debtor Sellers together
with the Debtors, each a “Seller” and, collectively, the “Sellers”), is entered
into as of July 26, 2010, by and among Luby’s Fuddruckers Restaurants, LLC, a
Texas limited liability company (the “Purchaser”), and the Sellers.  Capitalized
terms used and not defined in this Amendment shall have the meanings given to
them in the Asset Purchase Agreement.
 
RECITALS
 
WHEREAS, Luby’s has assigned all of its rights and obligations under the Asset
Purchase Agreement to the Purchaser pursuant to and subject to Section 12.10 of
the Asset Purchase Agreement;
 
WHEREAS, the Sellers have agreed in Section 8.2(B) of the Asset Purchase
Agreement to not sell gift certificates and gift cards at any Seller-owned or
-operated Acquired Location after the Petition Date (as more fully set forth in
said Section 8.2(B)) and the Sellers and the Purchaser desire to amend Section
3.1 of the Asset Purchase Agreement to provide the Purchaser with a credit of
$12,000 as compensation for gift certificates and gift cards sold by the Sellers
after the Petition Date;
 
WHEREAS, the Sellers have agreed in Section 8.3 of the Asset Purchase Agreement
to reasonably cooperate with the Purchaser in connection with the Purchaser’s
efforts to obtain any Liquor License Approvals and the Purchaser has determined
that acquiring Fuddruckers’ equity interests in R. Wes and Howard County would
help facilitate the Purchaser’s efforts in obtaining the Liquor License
Approvals;
 
WHEREAS, the Sellers and the Purchaser desire to amend the Asset Purchase
Agreement to provide that, on the Closing Date, the Sellers will transfer all
cash, cash equivalents, bank deposits or similar cash items of R. Wes to the
Sellers;
 
WHEREAS, the Sellers and the Purchaser desire to amend the process set forth in
Section 8.10 of the Asset Purchase Agreement for the payment of utility charges
relating to the Acquired Locations incurred prior to the Closing Date;
 
WHEREAS, the Sellers desire to use the corporate office after the Closing and
the Purchaser will allow such use on the terms set forth herein;

 
 

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WHEREAS, the Sellers and the Purchaser desire to amend the Asset Purchase
Agreement to provide that the intercompany receivables owing from any of the
Seller Parties (as defined below) to one or more of the other Seller Parties are
not Purchased Assets and that intercompany Liabilities owing from any of the
Seller Parties to one or more of the other Seller Parties are not Assumed
Liabilities;
 
WHEREAS, the Sellers and the Purchaser have agreed that the Pearland/Oceanside
Personal Property (as defined below) should be Purchased Assets; and
 
WHEREAS, the parties hereto wish to amend the Asset Purchase Agreement with
respect to the matters set forth herein.
 
AGREEMENT
 
NOW, THEREFORE, the Purchaser and the Sellers agree as follows:
 
1.           Amendment of Section 2.1(b).  Section 2.1(b) of the Asset Purchase
Agreement is hereby amended to add new subparagraphs (xviii) and (xix) as
follows:
 
“(xviii)     all of Fuddruckers’ right, title and interest in the outstanding
capital stock or other equity interest of R. Wes and Howard County; and
 
  (xix)       subject to the procedures required by the Bankruptcy Court
(including, to the extent applicable, the procedures set forth in the Final
Order Authorizing and Approving Expedited Procedures for the Sale of De Minimis
Assets (the “De Minimis Sale Procedures Order”)), all of the Furniture and
Equipment (other than fixtures or fixed assets) owned by the Sellers and located
at the Sellers’ restaurant #432 located at 3149 Silverlake Village Dr., #104,
Pearland, Texas 77584 (the “Pearland Location”) and at the Sellers’ restaurant
#434 located at 2320 S. El Camino Real, Oceanside, CA 92054 (the “Oceanside
Location”) (such Furniture and Equipment, the “Pearland/Oceanside Personal
Property”).”
 
2.           Amendments of Section 2.2.
 
(a)           Section 2.2(m) of the Asset Purchase Agreement is hereby amended
to delete the existing Section 2.2(m) in its entirety and to replace such
provision with the following:
 
“(m)    all shares of capital stock or other equity interest of any Seller
(other than R. Wes and Howard County), and of ARVI of Pikesville, Inc., a
Maryland corporation, A.R.I.V. – Rockville, Inc., a Maryland corporation, and
8725 Metcalf II, Inc., a Kansas corporation (collectively, the “Excluded
Entities”), or any securities convertible into, exchangeable or exercisable for
shares of capital stock or other equity interest of any Seller (other than
R. Wes and Howard County) or any Excluded Entity;”
 
(b)           Section 2.2(o) of the Asset Purchase Agreement is hereby amended
to delete the existing Section 2.2(o) in its entirety and to replace such
provision with the following:
 
 
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“(o) (i) all credit card accounts receivable, deposits and other holdbacks being
held by credit card companies, in each case as of the Closing Date, in
connection with credit cards accepted by the Sellers, (ii) that certain
receivable owing from R.J. Management LLC to one or more of the Sellers with
respect to obligations under that certain Restaurant Management Agreement dated
April 30, 2007; and (iii) all intercompany receivables owing from any of the
Sellers or their Affiliates (including, without limitation, KCI, LLC, King
Cannon, Inc. and Fuddruckers International, LLC) (collectively, the “Seller
Parties”) to one or more of the other Seller Parties (including, without
limitation, any intercompany receivables under that certain Restaurant
Management Agreement, dated as of December 30, 1998, by and between Fuddruckers
and Magic, as amended and that certain Intellectual Property Licensing
Agreement, dated as of December 30, 1998, by and between Fuddruckers and Magic,
as amended);”
 
3.           Amendment of Sections 2.3 and 2.4.  Sections 2.3(a), 2.3(b),
2.3(c), 2.4(h) and 2.4(i) of the Asset Purchase Agreement are hereby amended to
delete the term “Closing Date” as used therein and to replace such term with the
word “Closing”.
 
4.           Amendment of Section 2.4.  Section 2.4 of the Asset Purchase
Agreement is hereby amended to add a new subparagraph (k) as follows:
 
“(k) all intercompany Liabilities owing from any of the Seller Parties to one or
more of the other Seller Parties (including, without limitation, any
intercompany Liabilities under that certain Restaurant Management Agreement,
dated as of December 30, 1998, by and between Fuddruckers and Magic, as amended
and that certain Intellectual Property Licensing Agreement, dated as of December
30, 1998, by and between Fuddruckers and Magic, as amended).”
 
5.           Amendment of Section 3.1.  Section 3.1 of the Asset Purchase
Agreement is hereby amended to delete the existing Section 3.1 in its entirety
and to replace such provision with the following:
 
“3.1    Purchase Price.  The aggregate cash consideration for the Purchased
Assets (the “Purchase Price”) shall be an amount equal to the sum of:  (a) the
Asset Price, plus (b) the amount of the Register Cash, plus (c) the amount of
all security deposits (as reflected in Schedule 5.12(d)) held by the landlords
under and pursuant to the Assumed Leases as of the Closing, plus or minus (d)
the aggregate amount payable by the Purchaser or the Sellers in accordance with
Sections 8.10 and 11.1 and minus (e) $12,000.”
 
6.           Amendment of Section 4.1.  Section 4.1 of the Asset Purchase
Agreement is hereby amended to add the following at the end of such Section 4.1:
 
“Notwithstanding anything to the contrary contained in this Agreement, (i) the
Closing shall be deemed to have occurred at 12:01 a.m. (Boston time) on the
Closing Date and (ii) as a result thereof, all sales at the Acquired Locations
on or after the Closing Date shall be for the account of the Purchaser and the
Sellers shall promptly pay to the Purchaser all amounts received by the Sellers
in respect of such sales (including amounts received from credit card
purchases).”

 
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7.           Amendment of Section 8.10(c).  Section 8.10(c) of the Asset
Purchase Agreement is hereby amended to delete the existing Section 8.10(c) in
its entirety and to replace such provision with the following:
 
“(c)         Any amounts payable by the Sellers in accordance with this
Section 8.10 and Section 11.1 shall be paid and fully satisfied in accordance
with Section 3.1.  Except as provided in the next sentence, the Purchaser shall
pay to any applicable third party all amounts due and payable after the Closing
with respect to the items to which the proration provisions of this Section 8.10
and Section 11.1 apply.  Notwithstanding the foregoing, the Sellers and the
Purchaser shall cause all water, telephone, electricity and other utility
accounts to be transferred from the Sellers to the Purchaser effective as of the
Closing Date, and the Sellers shall pay to any applicable third party all
amounts due and payable for water, telephone, electricity and other utility
accounts used prior to the Closing Date and the Purchaser shall pay to any
applicable third party all amounts due and payable for water, telephone,
electricity and other utility accounts used on or after to the Closing Date.  If
the Sellers or the Purchaser receive bills for water, telephone, electricity and
other utility accounts that relate to usage both before and after the Closing
(each, a “Straddle Period Utility Bill”), then the Sellers and the Purchaser
shall pro rate the charges for such usage in accordance with Section 8.10(a) and
shall reimburse each other the amount due no later than August 23, 2010;
provided, however, in the event a Straddle Period Utility Bill is not received
for a utility account by August 20, 2010, then the Sellers and the Purchaser
shall pro rate the charges for such usage in accordance with Section 8.10(a)
based on the amounts paid with respect to the prior period as reflected on the
most recent invoice received by the Sellers for the applicable utility account
and shall reimburse each other the amount due no later than August 23, 2010.”
 
8.           Amendments of Article VIII.
 
(a)           Article VIII of the Asset Purchase Agreement is hereby amended to
add a new Section 8.16 as follows:
 
“8.16   Officer and Director Resignations and Appointments.  Prior to the
Closing, and effective as of the Closing, the Sellers shall cause each of the
officers, managers and directors of R. Wes and Howard County, as applicable, to
resign as officers, managers and directors of R. Wes and Howard County and shall
appoint or cause to be appointed as officers, managers and directors of R. Wes
and Howard County, as applicable, the Persons designated by the Purchaser in a
notice delivered to the Sellers prior to Closing.”
 
(b)           Article VIII of the Asset Purchase Agreement is hereby amended to
add a new Section 8.17 as follows:
 

 
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“8.17   Corporate Office.  The Purchaser expects to assume the Office Lease,
dated as of February 15, 2005, by and between Sage Monterey Oaks, Ltd., a Texas
limited liability partnership, as Landlord, and Magic Restaurants, LLC, as
Tenant, as amended by the First Amendment to Lease Agreement, dated as of August
31, 2005, by and between Sage-Monterey Oaks, Ltd., as Landlord, and Fuddruckers,
Inc., as Tenant, and the Second Amendment to Lease Agreement, dated as of
November 1, 2005, by and between Sage-Monterey Oaks, Ltd., as Landlord, and
Fuddruckers, Inc., as Tenant (the “Corporate Office Lease”), in respect of the
Debtors’ corporate office located at 5700 MoPac Expressway, #C-300, Austin,
Texas (the “Corporate Office”).  The Debtors shall have the non-exclusive right
to share the use of the Corporate Office with the Purchaser beginning on the
Closing Date and continuing until December 31, 2010 (the “Shared Use
Term”).  The Purchaser shall not grant any other Person (other than Affiliates
of the Purchaser) the right to the use of the Corporate Office without the
consent of the Debtors.  The Debtors shall promptly reimburse the Purchaser for
50% of all rents, common area maintenance and other costs and charges paid by
the Purchaser under the Corporate Office Lease in respect of the Shared Use Term
and 50% of all real estate taxes due under the Corporate Office Lease, water,
telephone, electricity and other utility charges for the Corporate Office in
respect of the Shared Use Term.  The Debtors may use the Corporate Office for
the sole purpose of winding down the affairs of the Debtors in a manner that is
consistent with the requirements and limitations set forth in the Corporate
Office Lease and for no other purpose without the prior written consent of the
Purchaser.  Subject to the Corporate Office Lease, so long as the Debtors are
paying when due the amounts required under this Section 8.17 and are otherwise
in compliance with their obligations under this Section 8.17, they shall have
the non-exclusive right to share the use of the Corporate Office with the
Purchaser without interference from the Purchaser or any party claiming by,
through or under the Purchaser.  The Debtors shall vacate their space within the
Corporate Office at the end of the Shared Use Term in broom-clean condition and
otherwise as required by the Corporate Office Lease.  The Debtors shall maintain
appropriate insurance covering their use of the Corporate Office and their
employees and representatives making use of such office.  The Debtors shall
indemnify, defend and hold harmless the Purchaser and its Affiliates for any and
all claims, losses, damages, liabilities, settlement payments, awards,
judgments, fines, penalties, assessments, obligations, costs or expenses of any
kind or type paid by the Purchaser to a third party and arising or resulting
from the actions or omissions of the Debtors (or their employees,
representatives or guests) at the Corporate Office which are in violation of
this Section 8.17, in violation of the Corporate Office Lease or in violation of
Law.  The Purchaser shall indemnify, defend and hold harmless the Debtors and
their Affiliates for any and all claims, losses, damages, liabilities,
settlement payments, awards, judgments, fines, penalties, assessments,
obligations, costs or expenses of any kind or type paid by the Debtors to a
third party and arising or resulting from the actions or omissions of the
Purchaser (or its employees, representatives or guests) at the Corporate Office
which are in violation of this Section 8.17, in violation of the Corporate
Office Lease or in violation of Law.  The Debtors’ rights under this Section
8.17 are subject and subordinate to the Corporate Office Lease and the Debtors
agree that they will abide by the terms of the Corporate Office Lease applicable
to the Purchaser.”

 
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(c)           Article VIII of the Asset Purchase Agreement is hereby amended to
add a new Section 8.18 as follows:
 
“8.18   Pearland Location and Oceanside Location.  In the event a landlord
objects to the sale to the Purchaser of any of the Pearland/Oceanside Personal
Property (in each case, a “Landlord Objection”), the Debtors and the Purchaser
shall cooperate with each other and use their commercially reasonable efforts to
resolve such Landlord Objection with the Purchaser bearing, and promptly
reimbursing the Debtors for all reasonable expenses incurred by the Debtors with
Purchaser’s prior consent in connection with the resolution of such Landlord
Objection.  The Purchaser shall remove the Pearland/Oceanside Personal Property
from the Pearland Location and the Oceanside Location at its own cost and
expense on or before July 31, 2010 unless Purchaser is prohibited as a result of
the Landlord Objection from taking possession of the Pearland/Oceanside Personal
Property subject to such Landlord Objection.  Nothing in this Section 8.18
requires Purchaser to proceed with the purchase of Pearland/Oceanside Personal
Property that is the subject of a Landlord Objection and, at anytime prior to
the sale of such Pearland/Oceanside Personal Property becoming effective
pursuant to the terms of the De Minimis Sale Procedures Order, Purchaser may by
written notice delivered to the Sellers in accordance with Section 12.8 of this
Agreement, designate some or all of the Pearland/Oceanside Personal Property as
an Excluded Asset.”
 
(d)           Article VIII of the Asset Purchase Agreement is hereby amended to
add a new Section 8.19 as follows:
 
“8.19   Cash of R. Wes. On the Closing Date, the Sellers shall transfer all
cash, cash equivalents, bank deposits or similar cash items of R. Wes to the
Sellers.”
 
9.           Waiver.  The Purchaser hereby agrees to waive any failure by the
Sellers to comply with the provisions of Section 8.2(B) of the Asset Purchase
Agreement.
 
10.        No Other Amendments or Waivers; Asset Purchase Agreement Remains in
Effect.  Except as expressly amended by Sections 1, 2, 3, 4, 5, 6, 7 and 8 of
this Amendment or expressly waived by Section 9 of this Amendment, the Asset
Purchase Agreement shall remain in full force and effect in the form in which it
existed immediately prior to the execution and delivery of this Amendment.
 
11.        Amendments.  No amendments, changes or modifications to this
Amendment shall be valid unless the same are in writing and signed by the
parties hereto.
 
12.        Applicable Law.  This Amendment shall be governed by and construed in
accordance with the Laws of the State of Delaware applicable to contracts made
and performed in such State.

 
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13.        Counterparts.  This Amendment may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Amendment and all of which, when taken together, will be deemed to constitute
one and the same agreement.
 
[Signature Page Follows]

 
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to the Asset
Purchase Agreement to be executed in counterparts as of the day and year first
above written.
 
THE PURCHASER:
 
LUBY’S FUDDRUCKERS RESTAURANTS, LLC
     
By:
 Luby’s Management, Inc., its Manager
 

By: 
  
/s/ Peter Tropoli 
 
Name:
Peter Tropoli
 
Title:
Senior Vice President, Administration,
   
General Counsel and Secretary

 
 

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THE SELLERS:
 
FUDDRUCKERS, INC.
 
R. WES, INC.
         
By:
/s/ Peter Large
 
By:
/s/ Michael Mason
 
Name:  Peter Large
   
Name:  Michael Mason
 
Title:  President
   
Title:  President
         
MAGIC BRANDS, LLC
 
FUDDRUCKERS OF HOWARD COUNTY, LLC
     
By:  KCI, LLC, its sole Manager
 
By:  Fuddruckers, Inc., its Managing Member
         
By:
/s/ Peter Large
 
By:
/s/ Peter Large
 
Name:  Peter Large
   
Name:  Peter Large
 
Title:  Manager
   
Title:  President
         
ATLANTIC RESTAURANT VENTURES,
 
FUDDRUCKERS OF WHITE MARSH, LLC
INC. 
   
  
 
  
By:  Fuddruckers, Inc., its Managing Member
By: 
/s/ Peter Large 
     
Name:  Peter Large
 
By:
/s/ Peter Large
 
Title:  Director
   
Name:  Peter Large
       
Title:  President

 
 

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