RESTATED
                          CERTIFICATE OF INCORPORATION
                                       OF
                                  RALLY'S, INC.



         1.       The Corporation's name shall be Rally's, Inc.
         2.       The Corporation's duration shall be perpetual.
         3.       The Corporation shall be for profit.
         4.  The  Corporation's  purposes  shall  be to  engage  in the food and
restaurant  business and any and all other lawful acts or  activities  for which
corporations may be organized under the General Corporation Law of Delaware.
         5. Authorized  Shares.  1) The total number of shares of all classes of
stock which the Corporation shall have authority to issue is $55,000,000 shares,
of which 5,000,000  shares are to be Preferred  Stock,  $.10 par value per share
("Preferred  Stock"),  and  50,000,000  shares are to be Common Stock,  $.10 par
value per share ("Common  Stock").  Holders of Common Stock shall have the right
to cast one vote for each share  held of record on all  matters  submitted  to a
vote of the holders of Common Stock.
                  (2) The Preferred Stock may be created and issued from time to
time in one or more series  with such  designations,  preferences,  limitations,
conversion  rights,  cumulative,  relative,  participating,  optional  or  other
rights,  including  voting rights,  qualifications,  limitations or restrictions
thereof as  determined by the Board of  Directors,  or the  Executive  Committee
thereof,  and shall be set forth in duly adopted  resolutions in accordance with
the Delaware General Corporation Law, as amended.
         6.       The address of the Corporation's initial registered office 
shall be
                           229 South State Street
                           Dover, Kent County, Delaware 19901
The name of the Corporation's  initial registered agent at that address shall be
The Prentice-Hall Corporation System, Inc.

                                       23
<PAGE>
         7.       The number of directors constituting the Corporation's initial
Board of Directors shall be one.  The member of the initial Board of Directors 
shall be
                           Richard F. Sherman
                           10000 Shelbyville Road
                           Louisville, Kentucky  40223
         8. Any action  required or  permitted to be taken at any meeting of the
Board of Directors  may be taken  without a meeting if all of the members of the
Board of Directors  consent thereto in writing,  and the writing or writings are
filed with the minutes of proceedings of the Board of Directors.
         9.       No stockholder  shall have any preemptive  right to subscribe
to an additional issue of stock or to any security convertible into stock.
         10.      (Reserved).
         11.  If any  stockholder  or  stockholders  shall  enter  into with any
stockholder or stockholders  or with the Corporation any agreement  imposing any
restrictions upon the transfer of shares of capital stock of the Corporation and
shall deliver a copy of the agreement to the Secretary to be kept on file at the
Corporation's  registered  office,  then the shares subject to such restrictions
shall  be  transferable  only  in  accordance  with  such  agreement  and may be
transferred on the stock transfer  books of the  Corporation  only in accordance
with such agreement.
         12. A director of the Corporation shall not be personally liable to the
Corporation  or its  stockholders  for monetary  damages for breach of fiduciary
duty as a director,  except for liability  (i) for any breach of the  director's
duty of  loyalty  to the  Corporation  or its  stockholders,  (ii)  for  acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law,  (iii) under Section 174 of the Delaware  General  Corporation
Law, or (iv) for any  transaction  from which the  director  derived an improper
personal benefit.
         13.      The name and  address of the  incorporator  are C. Edward 
Glasscock,  1600  Citizens  Plaza, Louisville, Kentucky  40202.
         14.      The  powers  of the  incorporator  shall  terminate  upon the
filing of the  Certificate  of Incorporation.
         15.      The Board of  Directors  shall have the power to adopt,  amend
or repeal  the  by-laws of the Corporation.
         16. (a) Current and former  directors  and officers of the  Corporation
(and their heirs,  executors and  administrators)  shall be  indemnified  to the
maximum  extent  permitted or mandated by, and in accordance  with, the Delaware
General  Corporation  Law,  as amended  from time to time.  The  indemnification

                                       24
<PAGE>
provided by this  Article  shall not be deemed  exclusive of any other rights to
which those  indemnified  may be entitled  under any bylaw,  agreement,  vote of
stockholders or disinterested directors or otherwise.
                  (b) The  Corporation  may purchase  and maintain  insurance on
behalf of any person who is or was a director or officer of the Corporation,  or
who while a director  or officer of the  Corporation,  is or was  serving at the
request of the Corporation as a director,  officer, partner, trustee,  employee,
or agent of another foreign or domestic corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise, against any liability asserted
against  him and  incurred  by him in any such  capacity  or arising  out of his
status as such, whether or not the Corporation would have the power to indemnify
him against such liability under the provisions of this Article.

                                       25