EXHIBIT 3.01

                            ARTICLES OF INCORPORATION
                                       OF
                         CLUCKER'S TEX-MEX VENTURE, INC.

     The  undersigned,  acting as incorporator of a corporation  under the Texas
Business  Corporation  Act, as amended (the "Act"),  hereby adopts the following
Articles of Incorporation for such corporation.

                                  ARTICLE ONE
                                      NAME
                                      ----

     The  name of the  corporation  is  CLUCKER'S  TEX-MEX  VENTURE,  INC.  (the
"Corporation"). 

                                  ARTICLE TWO
                               PERIOD OF DURATION
                               ------------------

     The period of duration of the Corporation is perpetual.

                                  ARTICLE THREE
                               PURPOSES AND POWERS
                               -------------------

     Section 1.  Purposes.  The purposes for which the  Corporation is organized
are to  transact  any and all  lawful  business  for which  corporations  may be
incorporated under the Act.
 
     Section  2.  Powers.   Subject  to  any  specific  written  limitations  or
restrictions  imposed  by the  Act,  by  other  law,  or by  these  Articles  of
Incorporation,  and solely in  furtherance  thereof,  but not in addition to the
limited purposes set forth in Section 1 of this Article,  the Corporation  shall
have and exercise all of the powers  specified in the Act,  which powers are not
inconsistent with these Articles.
 

                                  ARTICLE FOUR
                  CAPITALIZATION, PREEMPTIVE RIGHTS AND VOTING
                  --------------------------------------------

     Section 1. Authorized Shares. The Corporation shall have authority to issue
two  classes  of  shares  to be  designated  respectively,  "Common  Stock"  and
"Preferred  Stock".  The  total  number  of  shares  which  the  Corporation  is
authorized to issue is FIFTEEN MILLION  (15,000,000) shares of which TEN MILLION
(10,000,000)  shall be  Common  Stock  and  FIVE  MILLION  (5,000,000)  shall be
Preferred Stock.  Each share of Common Stock shall have a par value of ONE CENTS
($.01),  and each share of Preferred  Stock shall have a par value of ONE DOLLAR
($1.00).

     The Preferred Stock  authorized by these Articles of  Incorporation  may be
issued  from time to time in one or more  series,  each of which shall have such
designation(s)  or title(s) as may be fixed by the Board of  Directors  prior to
the issuance of any shares thereof.  The Board of Directors is hereby authorized
to  fix  or  alter  the  redemption,  including  sinking  fund  provisions,  the
redemption  price or prices,  voting rights and  liquidation  preferences of any
wholly unissued series of Preferred Stock, and the number of shares constituting
any such series and the designation thereof, or any of them. The rights, powers,
preferences,  limitations and restrictions,  if any, accompanying such shares of
Preferred  Stock  shall be set forth by  resolution  of the  Board of  Directors
providing for the issue thereof prior to the issuance of any shares thereof,  in
accordance  with the applicable  provisions of the Act. Each share of any series
of  Preferred  Stock shall be  identical  with all other  shares of such series,
except as to the date from which dividends, if any, shall accrue.


<PAGE>


     Section 2. Preemptive  Rights.  No holder of shares of capital stock of the
Corporation  shall, as such holder,  have any right to purchase or subscribe for
any capital stock of any class which the Corporation may issue or sell,  whether
or not  exchangeable  for any capital stock of the  Corporation  of any class or
classes,  whether issued out of unissued shares  authorized by these Articles of
Incorporation as originally filed or by any amendment thereof,  or out of shares
of capital stock of the Corporation  acquired by it after the issue thereof; nor
shall any holder of shares of capital stock of the Corporation,  as such holder,
have any right to purchase,  acquire or subscribe for any  securities  which the
Corporation  may issue or sell whether or not  convertible  into or exchangeable
for shares of capital  stock of the  Corporation  of any class or  classes,  and
whether  or not  any  such  securities  have  attached  or  appurtenant  thereto
warrants,  options or other  instruments  which  entitle the holders  thereof to
purchase,  acquire or  subscribe  for  shares of  capital  stock of any class or
classes.

     Section 3.  Voting.  In the exercise of voting  privileges,  each holder of
shares of the capital stock of the Corporation shall be entitled to one (1) vote
for  each  share  held  in his  name on the  books  of the  Corporation.  In all
elections  of  Directors  of the  Corporation,  cumulative  voting is  expressly
prohibited.  As such,  each holder of shares of capital stock of the Corporation
entitled to vote at the election of Directors  shall have the right to vote,  in
person or by proxy,  all or any  portion  of such  shares  for or  against  each
individual  Director  to be  elected  and shall not be  entitled  to vote for or
against any one Director more than the  aggregate  number of shares held by such
holder which are entitled to vote on the election of Directors.  With respect to
any action to be taken by the  Shareholders of the Corporation as to any matter,
the  affirmative  vote of the holders of a majority of the shares of the capital
stock of the  Corporation  entitled to vote thereon and represented in person or
by proxy at a meeting of the  Shareholders at which a quorum is present shall be
sufficient to authorize,  affirm,  ratify or consent to such action.  Any action
required by the Act to be taken at any annual or special meeting of Shareholders
may be taken without a meeting,  without prior notice,  and without a vote, if a
consent or  consents  in writing,  setting  forth the action so taken,  shall be
signed by the holder or holders of a majority of the  outstanding  shares of the
capital stock of the Corporation entitled to vote thereon.

                                  ARTICLE FIVE
                            COMMENCEMENT OF BUSINESS
                            ------------------------

     The Corporation  shall not commence  business until it has received for the
issuance of its shares of Common  Stock  consideration  of the value of at least
ONE THOUSAND AND N0/100  DOLLARS  ($1,000.00)  consisting  of money paid,  labor
done, or property actually received.

                                   ARTICLE SIX
                           REGISTERED AGENT AND OFFICE
                           ---------------------------

     Section 4. Registered  Office. The address of the initial registered office
of the  Corporation  is Billy Blues Food  Corporation,  1250 Northeast Loop 410,
Suite 430, San Antonio, Texas 78209.

<PAGE>


     Section 5. Registered  Agent.  The name of the initial  registered agent of
the Corporation at such address is William J. Gallagher.

                                  ARTICLE SEVEN
                                    DIRECTORS
                                    ---------

     Section 1.  Initial  Board of  Directors.  The  business and affairs of the
Corporation  shall be  managed  by or be under  the  direction  of the  Board of
Directors of the  Corporation.  The initial Board of Directors  shall consist of
four members who need not be residents of the State of Texas or  Shareholders of
the  Corporation.  The number of Directors of the  Corporation  may from time to
time be changed in accordance with the Bylaws of the Corporation and the Act.
 
     Section 2. Names and Addresses.  The names and addresses of the persons who
are to serve as Directors  until the first  annual  meeting of  Shareholders  or
until their successors are elected and qualified,  or until their earlier death,
resignation, or removal are as follows:

NAME                            ADDRESS                CITY, STATE
----                            -------                -----------
William J. Gallagher            1250 NE Loop 410       San Antonio, Texas  78209
                                Suite 430

John H. Coleman, III            1250 NE Loop 410       San Antonio, Texas  78209
                                Suite 430

Dr. Henry Salzarulo             1250 NE Loop 410       San Antonio, Texas  78209
                                Suite 430

Sam Bell Steves                 1250 NE Loop 410       San Antonio, Texas  78209
Rosser                          Suite 430


     Section 3.  Limitations  on  Liability  of  Directors.  No  Director of the
Corporation  shall be personally  liable to the Corporation or its  Shareholders
for  monetary  damages for an act or omission  in the  Director's  capacity as a
Director; provided, however, that the foregoing provision shall not eliminate or
limit the  liability  of a Director to the extent a Director is found liable for
(a) a  breach  of the  Director's  duty of  loyalty  to the  Corporation  or its
Shareholders, (b) an act or omission not in good faith that constitutes a breach
of duty of the Director to the  Corporation  or an act or omission that involves
intentional misconduct or a knowing violation of the law, (c) a transaction from
which the  Director  received  an improper  benefit,  whether or not the benefit
resulted from an action taken within the scope of the Director's  office, or (d)
an act or omission for which the liability of the Director is expressly provided
by an applicable statute.

     If  the  Texas  Miscellaneous  Corporation  Laws  Act or  other  applicable
provision of Texas law hereafter is amended to authorize further  elimination or
limitation of the  liability of  Directors,  then the liability of a Director of
the  Corporation,  in  addition  to the  limitation  on the  personal  liability
provided  herein,  shall be limited to the fullest extent permitted by the Texas
Miscellaneous Corporation Laws Act or other applicable provision of Texas law as
amended. Any repeal or modification of this Section 3 by the Shareholders of the
Corporation  shall be  prospective  only,  and shall not  adversely  affect  any
limitation on the personal  liability of a Director of the Corporation  existing
at the time of such repeal or modification.

<PAGE>


                                  ARTICLE EIGHT
                      SPECIAL POWERS OF BOARD OF DIRECTORS
                      ------------------------------------

     In  furtherance  of, and not in  limitation  of the powers and  authorities
conferred under the Act, the Board of Directors is expressly authorized:

          1. To make, alter, amend and rescind the Bylaws of the Corporation; to
fix,  adjust and maintain from time to time the amount to be reserved as working
capital;  and to authorize and cause to be executed mortgages and liens upon the
real and personal property of the Corporation.

          2. From time to time,  to determine  whether and to what extent and at
what times and places and under what  conditions and provisions the accounts and
books of the  Corporation  shall be maintained and made available for inspection
of any  Shareholder,  and no  Shareholder  shall have any right to  inspect  any
account or books or records of the  Corporation,  except as provided in the Act,
or authorized by the Board of Directors.

          3. If the Bylaws so provide,  to designate two or more of their number
to constitute an executive committee, which committee shall, as provided in said
resolution or in the Bylaws of the Corporation,  have and exercise any or all of
the powers of the Board of  Directors  in the  management  of the  business  and
affairs  of the  Corporation,  except  to the  extent  that the Act  requires  a
particular matter to be authorized by the Board of Directors.

                                  ARTICLE NINE
                           ADDITIONAL POWERS IN BYLAWS
                           ---------------------------

     The Corporation  may in its Bylaws confer powers and  authorities  upon the
Board of Directors in addition to the foregoing and to those expressly conferred
upon them by the Act.
                                              
                                   ARTICLE TEN
               TRANSACTIONS WITH INTERESTED DIRECTORS AND OFFICERS
               ---------------------------------------------------

     No contract or transaction  between the  Corporation and one or more of its
Directors or Officers,  or between the  Corporation  and any other  corporation,
partnership,  association  or other  organization  in  which  one or more of the
Directors or Officers of the Corporation are directors, officers or partners, or
have a financial  interest,  shall be void or voidable  solely by reason of such
relationship,  or solely  because  the  Director  or  Officer  is  present at or
participates  in the meeting of the Board of  Directors  of the  Corporation  or
committee thereof that authorizes the contract or transaction, or solely because
his or their votes are counted for such  purposes,  if any one of the  following
conditions are met:

          1. The material facts  concerning the  relationship or interest of the
Director  or  Officer  and  the  material  facts   concerning  the  contract  or
transaction  are  disclosed  or are  known  to the  Board  of  Directors  of the
Corporation or the committee thereof that considers the contract or transaction,
and the Board of Directors of the Corporation or committee thereof in good faith
authorizes the contract or transaction by the affirmative  vote of a majority of
the disinterested  Directors,  even though the  disinterested  Directors be less
than a quorum; or

          2. The material facts  concerning the  relationship or interest of the
Director  of  Officer  and  the  material  facts   concerning  the  contract  or
transaction  are disclosed or are known to the  Shareholders  of the Corporation
entitled to vote  thereon,  and the  contract  or  transaction  is  specifically
approved in good faith by the  Shareholders  of the Corporation at any annual or
special meeting of Shareholders called for that purpose; or

<PAGE>


          3. The contract or transaction is fair to the  Corporation at the time
it is  authorized,  approved  or  ratified  by the  Board  of  Directors  of the
Corporation, a committee thereof, or the Shareholders of the Corporation.

          Common or  interested  Directors  may be  counted in  determining  the
presence of a quorum at a meeting or the Board of Directors  of the  Corporation
or of a committee thereof that authorizes such contract or transaction.

                                 ARTICLE ELEVEN
                                 INDEMNIFICATION
                                 ---------------

     Section 1. Mandatory  Indemnification  and  Advancement  of Expenses.  Each
person who was or is made a party or is  threatened  to be made a party to or is
involved in any  threatened,  pending or completed  action,  suit or proceeding,
whether  civil,  criminal,  administrative,  arbitrative or  investigative,  any
appeal in such action, suit or proceeding, and any inquiry or investigation that
could lead to such an action, suit, or proceeding  ("Proceeding"),  by reason of
the fact that he 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,  venturer,  proprietor,
trustee,  employee,  agent,  or  similar  functionary  of  another  corporation,
partnership, joint venture, sole proprietorship, trust, employee benefit plan or
other  enterprise,  shall be indemnified and held harmless by the Corporation to
the  fullest  extent  permitted  by the Act  against  all  judgments,  penalties
(including  excise  and  similar  taxes),  fines,  settlements,  and  reasonable
expenses  (including  attorneys'  fees)  actually  incurred  by such  person  in
connection with such Proceeding.  Such right shall be a contract right and shall
include  the right to  require  advancement  by the  Corporation  of  reasonable
expenses  (including  attorneys' fees) incurred in defending any such Proceeding
in advance of its final disposition; provided, however, that the payment of such
expenses in advance of the final disposition of such Proceeding shall be made by
the Corporation  only upon delivery to the Corporation of a written  affirmation
by such person of his good faith  belief that he has met the standard of conduct
necessary for indemnification under the Act and a written undertaking,  by or on
behalf  of such  person,  to repay  all  amounts  so  advanced  if it  should be
ultimately determined that such person has not satisfied such requirements.

     Section 2. Nature of  Indemnification.  The indemnification and advancement
of  expenses  provided  for herein  shall not be deemed  exclusive  of any other
rights  permitted  by law to  which  a  person  seeking  indemnification  may be
entitled  under any Bylaw,  agreement,  vote of  Shareholders  or  disinterested
Directors or otherwise, and shall continue as to a person who has ceased to be a
Director  or Officer of the  Corporation  and shall  inure to the benefit of the
heirs, executors and administrators of such a person.

     Section 3.  Insurance.  The  Corporation  shall have power to purchase  and
maintain insurance or another  arrangement on behalf of any person who is or was
a director,  Officer, employee or agent of the Corporation, or is or was serving
at the request of the  Corporation as a director,  officer,  partner,  venturer,
proprietor,   trustee,  employee,  agent,  or  similar  functionary  of  another
corporation,  partnership,  joint venture, sole proprietorship,  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 Eleven or the Act.

<PAGE>


                                 ARTICLE TWELVE
                               AMENDMENT OF BYLAWS
                               -------------------

     The  Shareholders  of the  Corporation  hereby  delegate  to the  Board  of
Directors  the  power  to  adopt,  alter,  amend or  repeal  the  Bylaws  of the
Corporation.  Such power shall be vested  exclusively  in the Board of Directors
and shall not be exercised by the Shareholders.

                                ARTICLE THIRTEEN
                  POWER TO CALL SPECIAL SHAREHOLDERS' MEETINGS
                  --------------------------------------------

     Special  meetings of the  Shareholders  of the Corporation may be called by
the President of the Corporation,  the Board of Directors or holders of not less
than  ten  percent  (10%) of all the  shares  entitled  to vote at the  proposed
special meeting of the Shareholders.

                                ARTICLE FOURTEEN
                                   AMENDMENTS
                                   ----------

     The Corporation  reserves the right to amend,  alter,  change or repeal any
provision  contained in these Articles of  Incorporation or in its Bylaws in the
manner  now  or  hereafter   prescribed   by  the  Act  or  these   Articles  of
Incorporation,  and all rights  conferred  on  Shareholders  herein are  granted
subject to this reservation.

                                 ARTICLE FIFTEEN
                                    CAPTIONS
                                    --------

     The captions used in these Articles of  Incorporation  are for  convenience
only and shall not be construed in interpreting the provisions hereof.

                                 ARTICLE SIXTEEN
                                  INCORPORATOR
                                  ------------

     The name and address of the Incorporator are as follows:

NAME                         ADDRESS                   CITY, STATE
----                         -------                   -----------

George L. Diamond            901 Main Street,          Dallas, Texas  75202-3714
                             Suite 3300


     IN WITNESS WHEREOF,  the undersigned has hereunto set his hand this l1th of
June, 1993.
                                                    

                                                     INCORPORATOR:


                                                     /s/ George L. Diamond
                                                     ---------------------
                                                     George L. Diamond



<PAGE>



                              ARTICLES OF AMENDMENT
                                     TO THE
                            ARTICLES OF INCORPORATION
                         CLUCKER'S TEX-MEX VENTURE, INC.
                         -------------------------------


     Pursuant  to  the   provisions  of  Article  4.04  of  the  Texas  Business
Corporation Act,  CLUCKER'S TEX-MEX VENTURE,  INC., the undersigned  corporation
(the  "Corporation")  adopts the following Articles of Amendment to its Articles
of Incorporation:

                               ARTICLE ONE : NAME

     The name of the corporation is CLUCKER'S TEX-MEX VENTURE, INC.

                            ARTICLE TWO : AMENDMENTS

     The following amendment to the Articles of Incorporation of the Corporation
was adopted by the Board of  Directors  of the  Corporation  on June 18, 1993 in
order to change the name of the Corporation.

     2.1 Article 1 of the Articles of Incorporation of the Corporation is hereby
amended to read in its entirety as follows:

                                   ARTICLE ONE
                                      NAME
                                      ----

     The name of the corporation is TEX-MEX VENTURE, INC. (the "Corporation").

                       ARTICLE THREE : OUTSTANDING SHARES

     The  number of shares of the  Corporation  outstanding  at the time of such
adoption was zero (0) shares of the Common Stock, $0.01 par value per share; and
the number of shares of the Common Stock  entitled to vote thereon was zero (0).
As such,  the Board of  Directors  of the  Corporation,  consisting  of four (4)
members,  authorized and adopted the foregoing by written  consent on even date,
with said  Articles  of  Amendment  being  executed by the  following  three (3)
Directors  constituting a majority of the Board of Directors of the Corporation.

Executed this 18th day of June, 1993.


                                             CLUCKER'S TEX-MEX VENTURE, INC.


                                             By: /s/ William J. Gallagher
                                             ----------------------------
                                                   WILLIAM J. GALLAGHER,
                                                   Director


                                             By: /s/ Steves Rosser
                                             ---------------------
                                                   SAM BELL STEVES ROSSER,
                                                   Director


                                             By: /s/ John H. Coleman, III
                                             ----------------------------
                                                   JOHN H. COLEMAN, III,
                                                   Director




<PAGE>

                              ARTICLES OF AMENDMENT
                                     TO THE
                            ARTICLES OF INCORPORATION

     Pursuant to the provisions of Article 4.0 of the Texas Business Corporation
Act, the undersigned  corporation  adopts the following Articles of Amendment to
its Articles of Incorporation:

                                   ARTICLE I

     The name of the corporation is TEX MEX VENTURES, INC.

                                   ARTICLE II

     The  following  amendment to the Articles of  Incorporation  was adopted by
shareholders of the corporation on April 28, 1995.

     The amendment  alters Article I of the Original  Articles of  Incorporation
and the full text of each provision added is as follows:

     "The name of the Corporation is CLUCKCORP INTERNATIONAL, INC."

                                  ARTICLE III

     The  number of shares of the  corporation  outstanding  at the time of such
adoption was  2,475,000,  and the number of shares  entitled to vote thereon was
2,475,000.

                                   ARTICLE IV

     The number of shares voted for such amendment was 1,672,500, and the number
of shares voted against such amendment was 0.

                                      -OR-

     The holders of all of the shares  outstanding  and entitled to vote on said
amendment  have  signed a consent in writing  adopting  said  amendment  and any
notice required has been given.

      Dated: April 28, 1995

                                             CLUCKCORP INTERNATIONAL, INC.


                                             /s/ William J. Gallagher
                                             ------------------------
                                             William J. Gallagher
                                             Secretary




<PAGE>


            STATEMENT OF CHANGE OF REGISTERED OFFICE/REGISTERED AGENT
            ---------------------------------------------------------
                                       OF
                          CLUCKCORP INTERNATIONAL, INC.
                        (Formerly Tex Mex Venture, Inc.)

                             (A Profit Corporation)

1.   The name of the corporation is:

                          Cluckcorp International, Inc.

2.   The address,  including street and number, of its present registered office
     as shown in the records of the  Secretary of State of Texas  before  filing
     this statement is:

                          Billy Blues Food Corporation
                       1250 Northeast Loop 410, Suite 430
                            San Antonio, Texas 78209

3.   The address, including street and number, to which its registered office is
     to be changed is:

                            Gunn, Lee & Miller, P.C.
                         300 Convent Street, Suite 1650
                            San Antonio, Texas 78205

4.   The name of its present  registered  agent,  as shown in the records of the
     Secretary of State of the State of Texas, before filing this statement is:

                                William Gallagher

5.   The name of its new registered agent is:

                                 Mark H. Miller

6.   The address of its  registered  office and the address of the office of its
     registered agent, as changed, will be identical.

7.   Such change was authorized by:

     |X|   The Board of Directors
     |_|   An officer of the corporation so authorized by the Board of Directors


                                            /s/ William Gallagher
                                            ---------------------
                                            William Gallagher, Chairman of Board


<PAGE>


                          CLUCKCORP INTERNATIONAL, INC.
                              (a Texas corporation)

                             STATEMENT OF RESOLUTION
                     ESTABLISHING SERIES OF PREFERRED STOCK
                 Series A Redeemable Convertible Preferred Stock

To:  The Secretary of State
     of the State of Texas

     Pursuant  to  the   provisions  of  Article  2.13  of  the  Texas  Business
Corporation   Act  (the   "Act"),   the   undersigned   corporation,   CLUCKCORP
INTERNATIONAL, INC. (the "Corporation"),  hereby submits the following statement
for the purpose of establishing  and designating a series of shares of preferred
stock to be known as Series A Redeemable  Convertible Preferred Stock and fixing
and determining the relative rights and preferences thereof:

                                  ARTICLE ONE

                                      NAME
                                      ----

     1. The name of the  Corporation  is CLUCKCORP  INTERNATIONAL,  INC. and the
charter number of the Corporation is 01274398.

                                  ARTICLE TWO

                              CORPORATE RESOLUTIONS
                              ---------------------

     1. The  following  resolution  establishing  and  designating  a series  of
preferred stock,  to-wit:  the Series A Redeemable  Convertible  Preferred Stock
(the "Series A Preferred Stock"), and fixing and determining the relative rights
and  preferences  thereof  was duly  adopted  by the Board of  Directors  of the
Corporation on May 19, 1997:

     BE IT RESOLVED that, pursuant to the authority expressly granted and vested
in the Board of Directors of the  Corporation  in accordance  with Article Four,
Section I of the Corporation's Articles of Incorporation,  authorizing 5,000,000
shares of Preferred  Stock (the "Preferred  Stock"),  $1.00 par value per share,
approved and adopted on June 17, 1993 by the affirmative  vote of the holders of
more than the requisite  majority of the issued and outstanding shares of Common
Stock of the Corporation entitled to vote thereon (being the only voting capital
stock of the  Corporation  then  outstanding) in accordance with and pursuant to
the  provisions  of  Article  2.13 of the Texas  Business  Corporation  Act (the
"Act"),  the Board of Directors of the Corporation does hereby approve and adopt
the  following   resolutions   designating  and  authorizing  for  issuance,  in
accordance  with  the  provisions  of  Article  2.13 of the  Act,  the  Series A
Preferred Stock of the Corporation, said resolutions hereby effected being prior
to the  issuance  of any  shares of  Preferred  Stock,  such  shares of Series A
Preferred Stock to consist of 3,000,000 shares, each having a par value of $1.00
per share,  and each of which shares of Series A Preferred  Stock shall have the
dividend rights, voting powers,  redemption provisions,  liquidation preferences
and the relative,  optional or other special rights, and shall be subject to the
qualifications,  limitations or  restrictions  set forth below and the remaining
2,000,000 authorized shares of the Preferred Stock shall remain undesignated and
reserved  for  future  issuance  subject  to the  future  action of the Board of
Directors of the Corporation.

<PAGE>


               Rights and Preferences of Series A Preferred Stock
               --------------------------------------------------

     2. Dividends.

     (a) Amount and Payment of Dividend.  Subject to the limitations hereinafter
set forth, the holders of Series A Preferred Stock shall be entitled to receive,
but only when,  if and as declared by the Board of  Directors,  dividends at the
rate of twelve  percent  (12%) per annum of the original  issue price thereof of
Ten and  No/100  Dollars  ($10.00)  per share,  and no more,  payable in arrears
quarterly in installments out of the funds of the Corporation  legally available
therefor on March 31, June 30,  September  30 and  December 31 of each year (the
"Dividend  Payment Date")  commencing  September 30, 1997. Such dividends may be
paid in cash or in shares of Common Stock of the  Corporation  as  determined by
the Corporation's Board of Directors in its sole discretion;  provided, however,
no fractional shares of Common Stock may be issued for dividends, any fractional
shares of Common Stock will be rounded to the nearest whole share,  and provided
further  that if any such  dividend  is paid in whole  or in part by  shares  of
Common  Stock,  the  number of  shares  of Common  Stock to be issued as a stock
dividend  shall be determined by the reported  market price of a share of Common
Stock on the last day of the  calendar  quarter  for such  stock  dividend.  Any
shares of Series A Preferred  Stock  issued  after the date hereof  shall accrue
dividends from the date of issuance.

     (b) Cumulative  Rights.  To the extent,  if any, that dividends at the rate
set forth in Section  1(a) above  shall not be paid or set apart in full for the
Series A Preferred Stock,  the aggregate  deficiency shall be cumulated and must
be fully paid or set apart for payment  before any dividends may be paid upon or
set apart for the Common Stock of the  Corporation or before the Corporation may
purchase any of its Common Stock or otherwise make any  distribution  on account
of its  Common  Stock or any  other  class of  capital  stock  now or  hereafter
authorized or issued by the  Corporation  which ranks on a parity with or junior
to the Series A Preferred  Stock  (other  than (i) a dividend  payable in Common
Stock,  or  (ii) by  conversion  into  or  exchange  for  capital  stock  of the
Corporation ranking junior to the Series A Preferred Stock as to dividends).

     (c) No Interest on Accrued Dividends. Any accumulations of dividends on the
Series A Preferred Stock shall not bear interest.

     (d)  Declaration.  Dividends  on the  Series  A  Preferred  Stock  shall be
declared if, when and as the Board of Directors of the Corporation  shall in its
sole discretion deem advisable,  and only from the surplus of the Corporation as
such  shall  be  fixed  and  determined  by the said  Board  of  Directors.  The
determination  of the Board of  Directors  at any time of the  amount of surplus
available  for the payment of dividends  shall be binding and  conclusive on the
holders of the shares of Series A Preferred Stock then outstanding. If dividends
are not paid in full upon the Series A Preferred  Stock and any other  Preferred
Stock ranking on a parity as to dividends with the Series A Preferred Stock, all
dividends  declared upon shares of Series A Preferred  Stock and upon such other
shares of  Preferred  Stock will be  declared  pro rata so that in all cases the
amount of dividends  declared per share on the Series A Preferred Stock and such
other  Preferred  Stock  shall  bear  the  same  ratio  to each  other  that the
accumulated  dividends  per share on the shares of the Series A Preferred  Stock
and such other shares of Preferred Stock bear to each other.  The holders of the
Series A Preferred Stock shall not be entitled to receive any dividends  thereon
other  than the  dividends  provided  for in the  preceding  provisions  of this
Section.

<PAGE>


     2. Voting  Rights and Notice of  Meetings.  The holders of the Common Stock
shall have the  exclusive  right and power to vote on any matter  submitted to a
vote of the  shareholders  of the  Corporation  and the  holders of the Series A
Preferred  Stock shall have no right or power  whether  authorized by the Act or
otherwise to vote on any matter or in any  proceeding or to be represented at or
to receive notice of any meeting of the shareholders.

     3. Redemption.

     (a) Selection of Shares for Redemption. At any time on or after nine months
from  the  initial  date of  issuance  of the  Series  A  Preferred  Stock,  the
Corporation  may  purchase  or redeem all, or from time to time any part of, the
shares of Series A  Preferred  Stock  then  issued  and  outstanding;  provided,
however, no shares of Series A Preferred Stock may be redeemed until all accrued
and unpaid  dividends,  if any, on all outstanding  shares of Series A Preferred
Stock  have  been  paid in full.  If less  than all of the  shares  of  Series A
Preferred  Stock then issued and outstanding are to be redeemed at one time, the
shares of Series A Preferred  Stock to be redeemed shall be selected pro rata or
by lot in such manner as may be  prescribed  by the  resolution  of the Board of
Directors of the Corporation.  The Corporation  shall on the redemption date pay
the holders of the shares of Series A Preferred  Stock so  purchased or redeemed
the Redemption  Price (as hereinafter  defined) for such shares out of the funds
of the Corporation  legally available therefor or through the issuance of Common
Stock of the Company in its sole  discretion.  Such redemption shall be effected
by call and written or printed notice (the  "Redemption  Notice") shall be given
to each holder of record of Series A Preferred Stock shares being called, either
personally or by mail to such holders last known address as shown on the records
of the  Corporation,  not less than  thirty  (30) days before the date fixed for
redemption.  The  Redemption  Notice  shall set forth (i) the shares of Series A
Preferred  Stock,  or part  thereof,  to be  redeemed,  (ii) the date  fixed for
redemption,  (iii) the Redemption  Price,  whether  payable in cash or in Common
Stock,  and (iv) the place at which the holders of Series A Preferred  Stock may
obtain payment of the Redemption  Price upon surrender of their respective share
certificates.  The redemption price (the  "Redemption  Price") for the shares of
Series A Preferred  Stock being  redeemed shall be 110% of the average bid price
per share of the  Series A  Preferred  Stock as quoted on the  NASDAQ,  or other
national  securities  exchange,  for the 20 trading days prior to the redemption
date, plus all dividends accrued and unpaid on such shares of Series A Preferred
Stock.

     (b) Surrender of Shares.  On or after the date fixed for  redemption,  each
holder of Series A Preferred  Stock  called for  redemption  shall,  unless such
holder  shall have  previously  exercised  such  holder's  option to convert the
Series A Preferred  Stock into Common Stock in the manner set forth in Section 4
below,  surrender  such  holder's  certificates  for  such  shares  of  Series A
Preferred  Stock to the  Corporation  at the place  designated in the Redemption
Notice and shall thereupon be entitled to receive the Redemption  Price.  Should
less  than  all the  shares  of  Series A  Preferred  Stock  represented  by any
surrendered certificate be redeemed, a new certificate for the unredeemed shares
shall be issued to the holder of record of such unredeemed shares.

     (c) Cessation of Rights as Shareholder.  From and after the redemption date
(unless  default shall be made by the  Corporation in duly paying the Redemption
Price in which case all rights of the holders of Series A Preferred  Stock shall
continue),  the holders of the shares of the Series A Preferred Stock called for
redemption  shall cease to have any rights as  shareholders  of the  Corporation
except the right to receive, without interest, the Redemption Price thereof upon
surrender of the  certificate(s)  representing  the shares of Series A Preferred
Stock  being  redeemed,  and such shares  shall not  thereafter  be  transferred
(except with the consent of the Corporation) on the books of the Corporation and
shall not be deemed outstanding for any purpose whatsoever.

<PAGE>


     (d) Cancellation of Redeemed Shares. All shares of Series A Preferred Stock
that are  redeemed  shall be canceled  and such shares  shall be restored to the
status of authorized but unissued shares of Preferred Stock.

     (e) Deposit of  Redemption  Price into  Trust.  If, on or prior to any date
fixed for  redemption of shares of Series A Preferred  Stock as provided in this
Section,  the  Corporation  deposits with any bank or trust company in Texas, or
any bank or trust  company in the United  States  duly  appointed  and acting as
transfer agent for the Corporation, as a trust fund, a sum sufficient to redeem,
on the date  fixed for  redemption,  the  shares  called  for  redemption,  with
irrevocable  instructions  and authority to the bank or trust company to publish
the notice of redemption,  or to complete such publication if already commenced,
and to pay,  on and after the date fixed for  redemption  or prior to such date,
the Redemption Price of the shares to their  respective  holders on surrender of
their  share  certificates,  then from and after the date of the  deposit,  even
though  such date may be prior to the date fixed for  redemption,  the shares so
called shall be deemed to be redeemed and  dividends on those shares shall cease
to accrue after the date fixed for  redemption.  The deposits shall be deemed to
constitute  full  payment of the shares to their  holders and from and after the
date of the deposit the shares shall be deemed to be no longer outstanding,  and
the holders of the shares  shall cease to be  shareholders  with respect to such
shares and shall have no rights with respect to such shares, except the right to
receive from the bank or trust company  payment of the  Redemption  Price of the
shares,  without interest,  on surrender of their certificates,  or the right to
convert said shares to Common Stock as provided in Section 4 below. Any money so
deposited on account of the Redemption  Price of Series A Preferred Stock shares
converted  after the making of the deposit  shall be repaid  immediately  to the
Corporation on the conversion of such preferred  shares.  Money so deposited and
unclaimed at the end of three (3) years shall be repaid to the  Corporation  and
thereafter  the holders of such shares of Series A  Preferred  Stock  called for
redemption shall look only to the Corporation for payment.

     4. Conversion of Series A Preferred Stock.

     (a) Conversion Right of Holder.  Each share of the Series A Preferred Stock
shall be  convertible,  at the option of the holder  thereof,  at any time after
nine  months  from the  date of  initial  issuance  of such  share  of  Series A
Preferred Stock (or, if such share is called for  redemption,  at any time up to
and including,  but not after,  the close of business on the fifth full business
day prior to the date fixed for such redemption, unless default shall be made by
the Corporation in providing funds for the payment of the Redemption Price) into
fully-paid  and  nonassessable  whole  shares of Common Stock upon the terms and
conditions set forth in the following paragraphs of this Section.

     (b) Mandatory Automatic  Conversion.  If at any time after nine months from
the date of initial  issuance  of such share of Series A  Preferred  Stock,  the
closing  price  of the  Series  A  Preferred  Stock  for a  period  of ten  (10)
consecutive  trading days equals or exceeds Twenty and No/100  Dollars  ($20.00)
per share, all outstanding Series A Preferred Stock will  automatically  convert
into Common Stock at the Conversion Ratio set forth in Section 4(d) below.

     (c)  Exercise  of  Conversion  Right.  Any holder of the Series A Preferred
Stock  electing to convert such stock into Common Stock pursuant to Section 4(a)
hereof shall deposit the  certificates  for the Series A Preferred  Stock at the
Corporation's  principal  office,  with  the  form  of  written  notice  to  the
Corporation  endorsed on such  certificate(s)  of his  election to convert  such
Series A Preferred  Stock into Common  Stock duly filled out and  executed.  The

<PAGE>


holder of any Series A Preferred  Stock  converted into Common Stock pursuant to
the  provisions  of Section 4(b) hereof shall deposit the  certificates  for the
Series A Preferred  Stock at the  Corporation's  principal  office within thirty
(30) days after receipt of written notice from the  Corporation of the automatic
mandatory  conversion.  If the holder of the Series A  Preferred  Stock fails to
deliver the  certificates  for the Series A Preferred  Stock to the  Corporation
within such thirty (30) day period,  the  Corporation may  nevertheless  without
further  notice to such holder treat such shares as being canceled upon issuance
of the  appropriate  number  of  shares  of  Common  Stock to such  holder.  The
conversion right in respect of any such Series A Preferred Stock shall be deemed
to have been exercised at either (i) the date on which the certificates therefor
and such notice of  election  duly  filled out and  executed  shall have been so
deposited  with the  Corporation  in the  event  the  conversion  right is being
exercised by the holder of the Series A Preferred Stock pursuant to Section 4(a)
hereof,  or (ii) thirty (30) days after the Corporation  mails written notice to
the Series A Preferred  Stock holder in the event the  conversion is a mandatory
automatic  conversion  pursuant to Section 4(b). The person  entitled to receive
the Common Stock issuable upon such conversion shall be treated for all purposes
as the record holder of such Common Stock on such date; provided,  however, that
the conversion  right in respect of any  certificate(s)  so deposited  after the
close of  business on any day shall not be deemed to have been  exercised  until
the next  succeeding  business  day.  As soon as  practicable,  and in any event
within  thirty (30)  business  days after the date of conversion of any Series A
Preferred  Stock into Common Stock pursuant to Section 4(a) or 4(b) hereof,  the
Corporation  shall  deliver  to  the  person  entitled  thereto,  certificate(s)
representing  the shares of Common  Stock to which such person shall be entitled
on such  conversion.  The  Corporation,  as a condition  to the exercise of such
rights of conversion, may require the payment of a sum equal to any transfer tax
or other  governmental  charge (but not including any tax payable upon the issue
of stock  deliverable  upon such  conversion) that may be imposed or required by
law, upon any transfer  incidental or prior thereto, or the submission of proper
proof that the same has been paid.

     (d) Conversion  Ratio. For each share of Series A Preferred Stock converted
as provided in Section 4(a) or 4(b) hereof the Corporation  shall deliver to the
holder  thereof 2.7 shares of Common Stock  subject to adjustment as provided in
Section 4(e) below; provided, however, the Corporation shall not be required, in
connection  with any such  conversion,  to  issue a  fraction  of a share of its
Common  Stock nor to  deliver  any stock  certificate  representing  a  fraction
thereof.

     (e)  Adjustment of Conversion  Ratio.  The number of shares of Common Stock
into which, under the Conversion Ratio stated in Section 4(d) hereof, each share
of the  Series A  Preferred  Stock is  convertible,  is based  upon an  assigned
conversion ratio of $3.70 (the "Conversion Price").  Such Conversion Ratio shall
be subject to adjustment from time to time in certain instances, as follows:

     (1)  On  Recapitalization.  On  any  recapitalization  of  the  Corporation
          through the subdivision or combination of its outstanding Common Stock
          into a greater  or smaller  number of shares,  the number of shares of
          Common Stock into which the shares of Series A Preferred  Stock may be
          converted shall be increased or reduced in the same proportion.

     (2)  On Dividend or  Distribution  Payable in Common  Stock or  Convertible
          Securities.  If the  Corporation  takes a record of the holders of its
          Common Stock for the purpose of  entitling  them to receive a dividend
          or other  distribution  payable  in  Common  Stock,  or in  securities
          convertible  into or exchangeable for Common Stock, the maximum number
          of shares of Common  Stock  issuable  in payment of such  dividend  or
          distribution,  or on conversion  of or in exchange for the  securities
          convertible into or exchangeable for Common Stock,  shall be deemed to
          have been issued and to be outstanding as of such record date, and the
          number of shares of Common  Stock  into  which the  shares of Series A
          Preferred  Stock may be converted  shall be increased in proportion to
          the  increase  of the  number of  outstanding  shares of Common  Stock
          resulting therefrom.

<PAGE>


     (3)  On Capital Reorganization, Reclassification,  Consolidation, Merger or
          Sale   of   Corporate   Assets.   On   any   capital   reorganization,
          reclassification of the capital stock, consolidation,  merger, or sale
          or  conveyance  of all or  substantially  all  of  the  assets  of the
          Corporation to another  corporation,  each share of Series A Preferred
          Stock  shall  be  convertible  into  the  same  kind  and  amounts  of
          securities,  including  share or other  assets,  or both, to which the
          number  of common  shares of the  Corporation  which  would  have been
          deliverable  on conversion of such shares of Series A Preferred  Stock
          immediately   prior   to   such   reorganization,    reclassification,
          consolidation,  merger,  sale or conveyance  would have been entitled.
          Appropriate  adjustments,  as  determined by the Board of Directors of
          the  Corporation,  shall be made in the  application of the provisions
          herein set forth with respect to the rights and  interests  thereafter
          of  the  holders  of  the  Series  A  Preferred  Stock  so  that  said
          provisions,  including the provisions  with respect to changes in, and
          other  adjustments  of,  the  Conversion  Rate,  shall  thereafter  be
          applicable,  as  nearly  as  reasonably  may be,  in  relation  to any
          securities or other assets thereafter deliverable on conversion of the
          shares of Series A Preferred Stock.

     (f) Statement of Adjusted  Amount.  Whenever the amount of shares of Common
Stock or other  securities  deliverable  on the conversion of Series A Preferred
Stock shall be adjusted pursuant to the provisions hereof, the Corporation shall
forthwith  maintain at its office and file with the transfer agent or agents for
the Series A Preferred  Stock and for Common  Stock,  a statement  signed by the
President  or Vice  President  of the  Corporation  and by its  Chief  Financial
Officer,  stating the adjusted  amount of the Common  Stock or other  securities
deliverable  for each  share of  Series A  Preferred  Stock,  calculated  to the
nearest one hundredth  (1/100) share, and setting forth in reasonable detail the
method of calculation  and the facts  requiring such adjustment and on which the
calculation is based.  Each adjustment shall remain in effect until a subsequent
adjustment hereunder is required.

     (g)  Fractional  Shares.  Neither  fractional  shares  nor  scrip  or other
certificates  evidencing such shares shall be issued on conversion of the Series
A  Preferred  Stock as  herein  provided,  but the  Corporation  shall,  in lieu
thereof, round all such fractional shares to the nearest whole share.

     (h)  Payment  of Taxes on  Conversion  of  Series A  Preferred  Stock.  The
Corporation  shall pay any and all issue and other  taxes that may be payable in
respect of any issue or  delivery  of Common  Stock on  conversion  of shares of
Series A Preferred Stock pursuant hereto. The Corporation shall not, however, be
required to pay any tax which may be payable in respect of any transfer involved
in the issue and delivery of Common Stock in a name other than that in which the
shares of Series A Preferred  Stock so  converted  were  registered  and no such
issue or delivery  shall be made unless and until the person  requesting  it has
paid to the Corporation the amount of any such tax, or has  established,  to the
satisfaction of the Corporation, that such tax has been paid.

     (i) Reservation of Sufficient Common Stock. So long as any shares of Series
A Preferred  Stock shall remain  outstanding  and the holders thereof shall have
the right to convert  said  shares in  accordance  with the  provisions  of this
Section 4, the  Corporation  will at all times reserve from the  authorized  and
unissued shares of its Common Stock a sufficient number of shares to provide for
such  conversions,  and  will  take  such  other  corporation  action  as may be
necessary  from time to time in order  that it may  validly  and  legally  issue
fully-paid and non-assessable shares of such Common Stock upon conversion of the
Series A Preferred Stock.

<PAGE>


     (j) Definition of Common Stock. In each case where reference is made to the
Common Stock of the Corporation in this Section, unless a different intention is
expressed,  such reference is to the class of Common Stock of the Corporation as
such class of stock exists at the date of the adoption of these  provisions,  or
stock into which the same may be changed from time to time.

     (k) Status of Converted  Preferred Shares. All shares of Series A Preferred
Stock so  converted  shall be canceled  and such shares shall be restored to the
status of authorized but unissued shares of Preferred Stock.

     5. Liquidation Rights.

     (a)  Liquidation  Preference  Amount.  In the  event  of any  voluntary  or
involuntary liquidation, dissolution or winding up of the business or affairs of
the Corporation, and after payment of, or adequate provision for payment of, the
debts,  liabilities  and other claims of the  Corporation  as  determined by its
Board of  Directors,  each  holder  of the  Series A  Preferred  Stock  shall be
entitled to receive,  out of the remaining net assets of the Corporation legally
available  for  distribution  to  its   shareholders,   before  any  payment  or
distribution  shall be made on the Common Stock,  or on any other class of stock
of the Corporation ranking junior to the shares of Series A Preferred Stock upon
liquidation, the amount of Ten and No/100 Dollars ($10.00) per share of Series A
Preferred Stock,  plus all accrued and unpaid dividends on each such share up to
the date fixed for distribution.

     (b) Proportionate Distribution Where Assets Insufficient.  In the event the
assets of the Corporation available for distribution to the holders of shares of
Series A  Preferred  Stock upon  dissolution,  liquidation  or winding up of the
Corporation  whether  voluntary or involuntary,  shall be insufficient to pay in
full all amounts to which such holders are entitled pursuant to paragraph (a) of
this Section, no such distribution shall be made on account of any shares of any
class of capital stock of the Corporation ranking on a parity with the shares of
Series A Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate  distributive  amounts  shall be paid on  account of the shares of
Series A Preferred  Stock,  ratably,  in  proportion  to the full  distributable
amounts for which  holders of all such parity shares are  respectively  entitled
upon such dissolution, liquidation or winding up.

     (c) Nonparticipation  Right. After the payment to the holders of the shares
of Series A Preferred  Stock of the full  preferential  amounts  provided for in
either  paragraph  (a) or (b) of this  Section,  as  applicable,  the holders of
Series  A  Preferred  Stock as such  shall  have no right or claim to any of the
remaining assets of the Corporation.
 
     (d)  Excluded  Transactions.  Neither the  consolidation  nor merger of the
Corporation with or into any other corporation, nor the sale, mortgage, exchange
or conveyance of all or substantially all of the properties,  assets or business
of the  Corporation,  nor any  liquidation,  dissolution  or  winding  up of the
Corporation occurring substantially concurrently with any such transaction shall
be deemed to be a  liquidation,  dissolution  or winding  up of the  Corporation
within the meaning hereof, unless otherwise determined by the Board of Directors
of the Corporation.

<PAGE>


     6. No  Preemptive  Rights.  No holder of shares of the  Series A  Preferred
Stock  shall,  as such  holder,  have any  preemptive  right to  subscribe to or
purchase  any shares of any class of  capital  stock of the  Corporation  now or
hereafter  authorized  or issued,  whether or not  exchangeable  for any capital
stock of the Corporation of any class or classes now or hereafter  authorized or
issued;  nor shall any holder of shares of the Series A Preferred Stock, as such
holder,  have any right to  purchase,  acquire or subscribe  for any  securities
which the  Corporation  may issue or sell  whether  or not  convertible  into or
exchangeable  for shares of  capital  stock of the  Corporation  of any class or
classes,  and whether or not any such  securities  have attached or  appurtenant
thereto warrants, options or other instruments which entitle the holders thereof
to purchase,  acquire or subscribe  for shares of capital  stock of any class or
classes of the Corporation.

     7.  Determination  of Market Value of Common Stock and Preferred Stock. The
determination  of the per share market value of Common Stock and Preferred Stock
as set forth in previous  Sections shall be determined using the last sale price
of the day or, where no sale is made on that day, the average of the closing bid
and asked prices for that day as reported by the NASDAQ Small Cap - Issue System
if the Common Stock is at the time listed thereon or, if it is not so listed, on
any other national  securities  exchange selected by the Corporation on which it
is at the time listed. If the Common Stock or Preferred Stock is not at the time
listed on any national  securities  exchange,  its market value for the purposes
hereof shall be the fair value as determined and certified to the Corporation by
a member of a national  securities  exchange selected by the Corporation.  If no
market value can be ascertained in accordance with the foregoing provisions, the
market value shall be fixed by the Board of Directors of the Corporation.

     8. Covenants of the Corporation.  The Corporation will not, by amendment to
its  Articles  of  Incorporation,  as amended,  or through  any  reorganization,
transfer  of  assets,  consolidation,  merger,  dissolution,  issue  or  sale of
securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of the  preferences and limitations of Series
A Preferred Stock to be observed or performed hereunder by the Corporation,  but
will at all times in good faith assist in the carrying out of all the provisions
set forth herein  relating to Series A Preferred  Stock and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the  holders  of  the  Series  A  Preferred  Stock  against  dilution  or  other
impairment.

     IN WITNESS WHEREOF, CLUCKCORP INTERNATIONAL, INC. has caused this Statement
of  Resolution  Establishing  Series  of  Shares  to be  signed  by  William  J.
Gallagher,  its Chairman of the Board and Chief Executive Officer,  and attested
by Steves Rosser, its Secretary, this 11th day of June, 1997.

                                         CLUCKCORP INTERNATIONAL, INC.


                                         By: /s/ William J. Gallagher
                                         ----------------------------
                                               WILLIAM J. GALLAGHER,
                                               Chairman of the Board and 
                                               Chief Executive Officer


                                         By: /s/ Steves Rosser
                                         ---------------------
                                               STEVES ROSSER,
                                               Vice-President and Secretary

<PAGE>

                         HARVEST RESTAURANT GROUP, INC.
                              (a Texas corporation)
                              ---------------------


                     SECOND AMENDED STATEMENT OF RESOLUTION
                     ESTABLISHING SERIES OF PREFERRED STOCK
                     --------------------------------------

                      Series B Convertible Preferred Stock

To:  The Secretary of State
     of the State of Texas

     Pursuant  to  the   provisions  of  Article  2.13  of  the  Texas  Business
Corporation Act (the "Act"),  the undersigned  corporation,  HARVEST  RESTAURANT
GROUP, INC., formerly CluckCorp International, Inc. (the "Corporation"),  hereby
submits the following  statement for the purpose of establishing and designating
a series  of  shares  of  preferred  stock to be known as  Series B  Convertible
Preferred  Stock and fixing and  determining the relative rights and preferences
thereof:

                                  ARTICLE ONE

                                      NAME
                                      ----

     1. The name of the Corporation is HARVEST  RESTAURANT  GROUP,  INC. and the
charter number of the Corporation is 01274398.

                                  ARTICLE TWO

                              CORPORATE RESOLUTIONS
                              ---------------------

     1. Be it known that on May 19, 1997 the  Corporation  had  established  and
designated  3,000,000  shares  of its  preferred  stock as  Series A  Redeemable
Convertible Preferred Stock ("Series A Preferred Stock").

     2. The following  resolution  establishing  and  designating  an additional
series of preferred  stock,  known as: the Series B Convertible  Preferred Stock
(the "Series B Preferred Stock"), and fixing and determining the relative rights
and  preferences  thereof  was duly  adopted  by the Board of  Directors  of the
Corporation on December 15, 1997. The Series B Preferred Stock shall rank junior
to the Series A Preferred Stock.

          BE IT RESOLVED that,  pursuant to the authority  expressly granted and
vested in the Board of Directors of the  Corporation in accordance  with Article
Four,  Section I of the  Corporation's  Articles of  Incorporation,  authorizing
5,000,000 shares of Preferred Stock (the "Preferred Stock"), $1.00 par value per
share,  approved  and  adopted on June 17, 1993 by the  affirmative  vote of the
holders of more than the requisite majority of the issued and outstanding shares

<PAGE>


of Common  Stock of the  Corporation  entitled to vote  thereon  (being the only
voting capital stock of the Corporation then outstanding) in accordance with and
pursuant to the provisions of Article 2.13 of the Texas Business Corporation Act
(the "Act"),  the Board of Directors of the Corporation  does hereby approve and
adopt the following  resolutions  designating and  authorizing for issuance,  in
accordance  with  the  provisions  of  Article  2.13 of the  Act,  the  Series B
Preferred Stock of the Corporation,  said resolutions hereby effected being made
prior to the issuance of any shares of Series B Preferred Stock,  such shares of
Series B Preferred Stock to consist of 1,000 shares,  each having a par value of
$1.00 per share, and each of which shares of Series B Preferred Stock shall have
the  dividend  rights,  voting  powers,   redemption   provisions,   liquidation
preferences  and the relative,  optional or other special  rights,  and shall be
subject to the  qualifications,  limitations or restrictions set forth below and
the remaining  1,999,000  authorized  shares of the Preferred Stock shall remain
undesignated  and reserved for future  issuance  subject to the future action of
the Board of Directors of the Corporation.

               Rights and Preferences of Series B Preferred Stock
               --------------------------------------------------

     1. Dividends.

          (a)  Amount  and  Payment  of  Dividend.  Subject  to the  limitations
hereinafter set forth, the holders of Series B Preferred Stock shall be entitled
to receive dividends at the rate of seven percent (7%) per annum of the original
issue price thereof of Ten Thousand and No/100 Dollars  ($10,000.00)  per share,
and no more,  payable  only at the time such  shares are  converted  pursuant to
Section 4 hereof.  Such  dividends  may be paid in cash or in shares of Series A
Preferred  Stock or Common Stock of the Corporation as determined by the holders
of the Series B Preferred stock in its sole discretion;  provided,  however,  no
fractional shares of either security may be issued for dividends, any fractional
shares will be rounded to the nearest whole share,  and provided further that if
any such  dividend  is paid in whole or in part by shares of Series A  Preferred
Stock or Common  Stock,  the number of shares of such security to be issued as a
stock  dividend  shall be determined by the reported  market price of a share of
the respective  security on the last day of the period for such stock  dividend.
Any shares of Series B Preferred Stock issued after the date hereof shall accrue
dividends from the date of issuance.

          (b) Cumulative  Rights.  To the extent,  if any, that dividends at the
rate set forth in Section  1(a) above shall not be paid or set apart in full for
the Series B Preferred  Stock,  the aggregate  deficiency shall be cumulated and
must be fully paid or set apart for  payment  before any  dividends  may be paid
upon or set  apart  for the  Common  Stock  of the  Corporation  or  before  the
Corporation  may  purchase  any  of its  Common  Stock  or  otherwise  make  any
distribution  on account of its Common Stock or any other class of capital stock
now or hereafter authorized or issued by the Corporation which ranks on a parity
with or  junior to the  Series B  Preferred  Stock  (other  than (i) a  dividend
payable in Common  Stock,  or (ii) by  conversion  into or exchange  for capital
stock of the  Corporation  ranking junior to the Series B Preferred  Stock as to
dividends).


                                    
<PAGE>


          (c) No Interest on Accrued  Dividends.  Any accumulations of dividends
on the Series B Preferred Stock shall not bear interest.

          (d)  Declaration.  Dividends on the Series B Preferred  Stock shall be
declared if, when and as the Board of Directors of the Corporation  shall in its
sole discretion deem advisable,  and only from the surplus of the Corporation as
such  shall  be  fixed  and  determined  by the said  Board  of  Directors.  The
determination  of the Board of  Directors  at any time of the  amount of surplus
available  for the payment of dividends  shall be binding and  conclusive on the
holders of the shares of Series B Preferred Stock then outstanding. If dividends
are not paid in full upon the Series B Preferred  Stock and any other  Preferred
Stock ranking on a parity as to dividends with the Series B Preferred Stock, all
dividends  declared upon shares of Series B Preferred  Stock and upon such other
shares of  Preferred  Stock will be  declared  pro rata so that in all cases the
amount of dividends  declared per share on the Series B Preferred Stock and such
other  Preferred  Stock  shall  bear  the  same  ratio  to each  other  that the
accumulated  dividends  per share on the shares of the Series B Preferred  Stock
and such other shares of Preferred Stock bear to each other.  The holders of the
Series B Preferred Stock shall not be entitled to receive any dividends  thereon
other  than the  dividends  provided  for in the  preceding  provisions  of this
Section.

     2.  Voting  Rights and Notice of Meeting.  The holders of the Common  Stock
shall have the  exclusive  right and power to vote on any matter  submitted to a
vote of the  shareholders  of the  Corporation  and the  holders of the Series B
Preferred  Stock shall have no right or power  whether  authorized by the Act or
otherwise to vote on any matter or in any  proceeding or to be represented at or
to    receive     notice    of    any     meeting    of    the     shareholders.

     3. Redemption.

     Neither the  Corporation  nor the  Holders of the Series B Preferred  Stock
shall have any rights of redemption as to the shares of Series B Preferred Stock
issued and outstanding.

     4. Conversion of Series B Preferred Stock.

          (a) Conversion  Right of Holder.  Each share of the Series B Preferred
Stock shall be  convertible,  at the option of the holder  thereof,  at any time
after the date of initial issuance of such share of Series B Preferred Stock and
up until 3 years  thereafter,  into either  fully-paid and  nonassessable  whole
shares of Series A Preferred Stock or Common Stock upon the terms and conditions
set forth in the  following  paragraphs  of this  Section.  However,  that if by
choosing  to convert  into one  security  rather  than the other would cause the
Corporation to be in violation of a NASDAQ or NASD rule or listing  requirement,
then the holder shall be  precluded  from  converting  into such  security.  The
option of the holder to  convert  each  share of Series B  Preferred  Stock into
shares of Common  Stock is  available  only if: (i) the closing bid price of the
Company's  Common  Stock  equals  or  exceeds  $3.00  per  share  on the date of
conversion,  or (ii) if a majority of the then current Board of Directors of the
Company  approves  a  written  notice  of  conversion  submitted  by the  holder
requesting  conversion  into Common Stock,  or (iii) if the holder was otherwise
precluded from converting into the Series A Preferred Stock.


                                    
<PAGE>


          (b) Automatic  Conversion.  The holder's conversion right shall expire
three (3) years  after the date of  issuance.  Upon three years from the date of
issuance,  all shares of Series B Preferred Stock that remain  outstanding  will
automatically convert into shares of the Corporation's Series A Preferred Stock,
however,  if the Series A Preferred  Stock is not  actively  traded at the time,
then the Series B Preferred Stock shall automatically convert into shares of the
Corporation's Common Stock. The Conversion Rate to be utilized for the automatic
conversion  shall the rate  specified  in Section  4(d) which yields the largest
number of shares to the holder.

          (c) Exercise of Conversion Right. Any holder of the Series B Preferred
Stock  electing to convert  such stock into  Series A Preferred  Stock or Common
Stock  pursuant to Section 4(a) hereof shall  deliver the  certificates  for the
Series B Preferred Stock to the Corporation's  principal office or the office of
the  Corporations  Transfer  Agent,  with  the  form of  written  notice  to the
Corporation  endorsed on such  certificate(s)  of his  election to convert  such
Series B Preferred  Stock into either  Series A Preferred  Stock or Common Stock
duly filled out and executed. The conversion right in respect of any such Series
B Preferred  Stock  pursuant to Section 4(a) hereof shall be deemed to have been
exercised  at the date on which the holder  delivers  such notice of  conversion
duly filled out and executed to the  Corporation or the  Corporation's  transfer
agent  (the  "Date of  Election").  A  facsimile  notice of  conversion  will be
accepted by the Corporation as a valid notice of election, so long as the holder
then delivers the original  certificates  within three business days thereafter.
The person  entitled  to receive the Series A  Preferred  Stock or Common  Stock
issuable  upon such  conversion  shall be treated for all purposes as the record
holder of such security on such date;  provided,  however,  that the  conversion
right in respect of any notice  received  after the close of business  (11:59 PM
EST) on any day  shall  not be  deemed  to have  been  exercised  until the next
succeeding  business day. As soon as practicable,  and in any event within three
(3) business days after the date of receipt of the original  certificates of any
Series B Preferred  Stock to be converted  pursuant to Section 4(a) hereof,  the
Corporation  shall  deliver  to  the  person  entitled  thereto,  certificate(s)
representing  the shares of Series A  Preferred  Stock or Common  Stock to which
such  person  shall  be  entitled  on such  conversion.  The  Corporation,  as a
condition to the exercise of such rights of conversion,  may require the payment
of a sum  equal  to any  transfer  tax or  other  governmental  charge  (but not
including  any tax  payable  upon  the  issue  of stock  deliverable  upon  such
conversion) that may be imposed or required by law, upon any transfer incidental
or prior thereto, or the submission of proper proof that the same has been paid.

          (d) Conversion  Rate. The number of shares of Series A Preferred Stock
or Common Stock  issuable  upon  conversion  of each share of Series B Preferred
Stock shall be as follows:


                                    
<PAGE>


               (1) Conversion into Series A Preferred  Stock:  Equal to $10,000,
divided by the lower of: (1) 105% of the average closing bid price of the Series
A Preferred Stock during the five trading day period immediately  proceeding the
Date of  Issuance  or (2) 80% of the  average  closing bid price of the Series A
Preferred  Stock during the five trading day period  immediately  proceeding the
Date of Election  as defined in Section  4(c)  hereof,  provided,  however,  the
Corporation  shall not be required,  in connection with any such conversion,  to
issue a fraction of a share of its Series A  Preferred  Stock nor to deliver any
stock certificate representing a fraction thereof.

               (2) Conversion  into Common Stock.  Equal to $10,000,  divided by
80% of the average closing bid price of the Common Stock during the five trading
day period  immediately  proceeding  the Date of  Election as defined in Section
4(a) hereof; provided, however, in order for any conversion into Common Stock to
take place,  the price of the Common Stock must be above the minimum price level
as set forth in Section 4(a) hereof.  Notwithstanding  the  preceding  sentence,
Buyer or  holder  can  convert  into  Common  Stock  regardless  of its price if
approved  by a  majority  of the  then  current  Board  of  Directors,  or if he
otherwise would be precluded from converting into Company's  Series A Preferred.
In addition,  the Corporation shall not be required, in connection with any such
conversion,  to issue a fraction  of a share of its Common  Stock nor to deliver
any stock certificate representing a fraction thereof.

               (3)  Limitations  on  Conversion.  Any  holder  of the  Series  B
Preferred  Stock will be allowed to convert 50% of the aggregate  amount of such
holder's  Series B  Preferred  Stock  beginning  the day after the  registration
statement  registering  the  underlying  shares of Series A  Preferred  Stock or
Common Stock has been  declared  effective,  but no sooner than 60 days from the
date the  Series B  Preferred  Stock  is  issued.  Any  holder  of the  Series B
Preferred  Stock  will be allowed to  convert  any and all  remaining  shares of
holder's  Series B Preferred  Stock beginning 120 days after the issuance of the
Series B Preferred Stock; provided,  however, that if on the 120th day after the
issuance of the Series B Preferred Stock the registration  statement has not yet
been declared  effective all holders must wait until the registration  statement
is declared  effective before converting any and all of their Series B Preferred
Stock.

          (e)  Adjustment of Conversion  Rate.  The number of shares of Series A
Preferred  Stock and Common  Stock into  which  share of the Series B  Preferred
Stock is convertible shall be subject to adjustment from time to time in certain
instances, as follows:

               (1)  On   Recapitalization.   On  any   recapitalization  of  the
Corporation  through the subdivision or combination of its outstanding  Series A
Preferred Stock or Common Stock into a greater or smaller number of shares,  the
number of shares of Common  Stock into  which the  shares of Series B  Preferred
Stock may be converted shall be increased or reduced in the same proportion.


                                     
<PAGE>


               (2) On Capital Reorganization,  Reclassification,  Consolidation,
Merger  or  Sale  of   Corporate   Assets.   On  any   capital   reorganization,
reclassification  of the  capital  stock,  consolidation,  merger,  or  sale  or
conveyance  of all or  substantially  all of the  assets of the  Corporation  to
another corporation, each share of Series B Preferred Stock shall be convertible
into the same kind and amounts of securities,  including  share or other assets,
or both,  into which the number of shares of  capital  stock of the  Corporation
which  would have been  deliverable  on  conversion  of such  shares of Series B
Preferred  Stock  immediately  prior to such  reorganization,  reclassification,
consolidation,  merger, sale or conveyance would have been entitled. Appropriate
adjustments,  as determined by the Board of Directors of the Corporation,  shall
be made in the  application of the  provisions  herein set forth with respect to
the rights and  interests  thereafter  of the  holders of the Series B Preferred
Stock so that said provisions,  including the provisions with respect to changes
in,  and  other  adjustments  of,  the  Conversion  Rate,  shall  thereafter  be
applicable,  as nearly as  reasonably  may be, in relation to any  securities or
other assets  thereafter  deliverable  on  conversion  of the shares of Series B
Preferred Stock.

          (f)  Statement  of Adjusted  Amount.  Whenever the amount of shares of
Series A Preferred Stock or Common Stock or other securities  deliverable on the
conversion  of  Series B  Preferred  Stock  shall be  adjusted  pursuant  to the
provisions  hereof,  the Corporation shall forthwith  maintain at its office and
file with the transfer agent or agents,  a statement  signed by the President or
Vice President of the Corporation and by its Chief  Financial  Officer,  stating
the adjusted  amount of any  securities  deliverable  for each share of Series B
Preferred  Stock,  calculated to the nearest one hundredth  (1/100)  share,  and
setting  forth in  reasonable  detail  the method of  calculation  and the facts
requiring such adjustment and on which the calculation is based. Each adjustment
shall remain in effect until a subsequent adjustment hereunder is required.

          (g) Fractional  Shares.  Neither  fractional shares nor scrip or other
certificates  evidencing such shares shall be issued on conversion of the Series
B  Preferred  Stock as  herein  provided,  but the  Corporation  shall,  in lieu
thereof, round all such fractional shares to the nearest whole share.

          (h) Payment of Taxes on  Conversion of Series B Preferred  Stock.  The
Corporation  shall pay any and all issue and other  taxes that may be payable in
respect of any issue or delivery of Series A Preferred  Stock or Common Stock on
conversion  of  shares  of  Series  B  Preferred  Stock  pursuant  hereto.   The
Corporation shall not, however,  be required to pay any tax which may be payable
in  respect  of any  transfer  involved  in the issue and  delivery  of Series A
Preferred Stock or Common Stock in a name other than that in which the shares of
Series B  Preferred  Stock so  converted  were  registered  and no such issue or
delivery shall be made unless and until the person requesting it has paid to the
Corporation the amount of any such tax, or has established,  to the satisfaction
of the Corporation, that such tax has been paid.

          (i)  Reservation  of  Sufficient  Series A Preferred  Stock and Common
Stock.  So  long  as any  shares  of  Series  B  Preferred  Stock  shall  remain
outstanding  and the holders thereof shall have the right to convert said shares
in accordance with the provisions of this Section 4, the Corporation will at all
times reserve from the authorized and unissued  shares of its Series A Preferred
Stock and  Common  Stock a  sufficient  number of  shares  to  provide  for such
conversions,  and will take such other  corporation  action as may be  necessary
from time to time in order that it may validly and legally issue  fully-paid and
non-assessable  shares of such  Series A  Preferred  Stock or Common  Stock upon
conversion of the Series B Preferred Stock.


                                    
<PAGE>


          (j) Definition of Series A Preferred  Stock and Common Stock.  In each
case where  reference is made to the Series A Preferred Stock or Common Stock of
the Corporation in this Section, unless a different intention is expressed, such
reference is to the series or class of Series A Preferred  Stock or Common Stock
of the  Corporation  as such series or class of stock  exists at the date of the
adoption of these  provisions,  or stock into which the same may be changed from
time to time.

          (k)  Status of  Converted  Preferred  Shares.  All  shares of Series B
Preferred Stock so converted shall be canceled and such shares shall be restored
to the status of authorized but unissued shares of Preferred Stock.

     5. Liquidation Rights.

          (a) Liquidation  Preference  Amount.  In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the business or affairs of
the Corporation, and after payment of, or adequate provision for payment of, the
debts,  liabilities  and other claims of the  Corporation  as  determined by its
Board of  Directors,  each  holder  of the  Series B  Preferred  Stock  shall be
entitled to receive,  out of the remaining net assets of the Corporation legally
available  for  distribution  to  its   shareholders,   before  any  payment  or
distribution  shall be made on the Common Stock,  or on any other class of stock
of the Corporation ranking junior to the shares of Series B Preferred Stock upon
liquidation,  the amount of Ten Thousand  and No/100  Dollars  ($10,000.00)  per
share of Series B Preferred Stock, plus all accrued and unpaid dividends on each
such share up to the date fixed for distribution.

          (b) Proportionate Distribution Where Assets Insufficient. In the event
the assets of the  Corporation  available  for  distribution  to the  holders of
shares of Series B Preferred Stock upon  dissolution,  liquidation or winding up
of the Corporation  whether  voluntary or involuntary,  shall be insufficient to
pay in full all amounts to which such holders are entitled pursuant to paragraph
(a) of this Section, no such distribution shall be made on account of any shares
of any class of capital  stock of the  Corporation  ranking on a parity with the
shares of Series B Preferred Stock upon such dissolution, liquidation or winding
up unless  proportionate  distributive  amounts  shall be paid on account of the
shares  of  Series  B  Preferred  Stock,  ratably,  in  proportion  to the  full
distributable   amounts  for  which  holders  of  all  such  parity  shares  are
respectively entitled upon such dissolution, liquidation or winding up.

          (c)  Nonparticipation  Right.  After the payment to the holders of the
shares of Series B Preferred Stock of the full preferential amounts provided for
in either  paragraph (a) or (b) of this Section,  as applicable,  the holders of
Series  B  Preferred  Stock as such  shall  have no right or claim to any of the
remaining assets of the Corporation.


                                      
<PAGE>

 
          (d) Excluded Transactions. Neither the consolidation nor merger of the
Corporation with or into any other corporation, nor the sale, mortgage, exchange
or conveyance of all or substantially all of the properties,  assets or business
of the  Corporation,  nor any  liquidation,  dissolution  or  winding  up of the
Corporation occurring substantially concurrently with any such transaction shall
be deemed to be a  liquidation,  dissolution  or winding  up of the  Corporation
within the meaning hereof, unless otherwise determined by the Board of Directors
of the Corporation.

     6. No  Preemptive  Rights.  No holder of shares of the  Series B  Preferred
Stock  shall,  as such  holder,  have any  preemptive  right to  subscribe to or
purchase  any shares of any class of  capital  stock of the  Corporation  now or
hereafter  authorized  or issued,  whether or not  exchangeable  for any capital
stock of the Corporation of any class or classes now or hereafter  authorized or
issued;  nor shall any holder of shares of the Series B Preferred Stock, as such
holder,  have any right to  purchase,  acquire or subscribe  for any  securities
which the  Corporation  may issue or sell  whether  or not  convertible  into or
exchangeable  for shares of  capital  stock of the  Corporation  of any class or
classes,  and whether or not any such  securities  have attached or  appurtenant
thereto warrants, options or other instruments which entitle the holders thereof
to purchase,  acquire or subscribe  for shares of capital  stock of any class or
classes of the Corporation.

     7.  Determination  of Market  Value of Capital  Stock of  Corporation.  The
determination  of the per share market value of Common Stock and Preferred Stock
as set forth in previous  Sections  shall be determined  using the previous five
day average closing bid price for the day or, where no sale is made on that day,
the average of the closing bid and asked  prices for that day as reported by the
NASDAQ Small Cap - Issue System if the securities are at the time listed thereon
or, if it is not so listed, on any other national  securities  exchange selected
by the  Corporation  on which it is at the time  listed.  If the Common Stock or
Preferred Stock is not at the time listed on any national  securities  exchange,
its market value for the purposes  hereof shall be the average closing bid price
for the last three trading days the  Preferred  Stock or Common Stock was listed
on any national securities exchange.

     8. Covenants of the Corporation.  The Corporation will not, by amendment to
its  Articles  of  Incorporation,  as amended,  or through  any  reorganization,
transfer  of  assets,  consolidation,  merger,  dissolution,  issue  or  sale of
securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of the  preferences and limitations of Series
B Preferred Stock to be observed or performed hereunder by the Corporation,  but
will at all times in good faith assist in the carrying out of all the provisions
set forth herein  relating to Series B Preferred  Stock and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the  holders  of  the  Series  B  Preferred  Stock  against  dilution  or  other
impairment.


                                    
<PAGE>


     IN WITNESS WHEREOF,  HARVEST  RESTAURANT GROUP, INC. has caused this Second
Amended  Statement of Resolution  Establishing  Series of Shares to be signed by
Steves Rosser, its Vice-President and Secretary, this 12th day of May, 1998.

                                             HARVEST RESTAURANT GROUP, MC.


                                             By: /s/ Steves Rosser
                                                 STEVES ROSSER,
                                                 Vice-President and Secretary



                                    
<PAGE>

                         HARVEST RESTAURANT GROUP, INC.
                              (a Texas corporation)
                              ---------------------

                             STATEMENT OF RESOLUTION
                     ESTABLISHING SERIES OF PREFERRED STOCK
                     --------------------------------------

                      Series C Convertible Preferred Stock


To:  The Secretary of State
     of the State of Texas

     Pursuant  to  the   provisions  of  Article  2.13  of  the  Texas  Business
Corporation Act (the "Act"),  the undersigned  corporation,  HARVEST  RESTAURANT
GROUP, INC., formerly CluckCorp International, Inc. (the "Corporation"),  hereby
submits the following  statement for the purpose of establishing and designating
a series  of  shares  of  preferred  stock to be known as  Series C  Convertible
Preferred  Stock and fixing and  determining the relative rights and preferences
thereof:

                                  ARTICLE ONE

                                      NAME
                                      ----

     1. The name of the Corporation is HARVEST  RESTAURANT  GROUP,  INC. and the
charter number of the Corporation is 01274398.

                                  ARTICLE TWO

                              CORPORATE RESOLUTIONS
                              ---------------------

     1. Be it known that on May 19, 1997, the  Corporation  had  established and
designated  3,000,000  shares  of its  preferred  stock as  Series A  Redeemable
Convertible  Preferred  Stock  ("Series A Preferred  Stock") and on December 22,
1997,  the  Corporation  had  established  and  designated  1,000  shares of its
preferred stock as Series B Convertible Preferred Stock.

     2. The following  resolution  establishing  and  designating  an additional
series of preferred  stock,  known as: the Series C Convertible  Preferred Stock
(the "Series C Preferred  Stock,  and fixing and determining the relative rights
and  preferences  thereof  was duly  adopted  by the Board of  Directors  of the
Corporation on July 2, 1998.  The Series C Preferred  Stock shall rank junior to
the Series A Preferred Stock and on parity with the Series B Preferred Stock.


<PAGE>


          BE IT RESOLVED that,  pursuant to the authority  expressly granted and
vested in the Board of Directors of the  Corporation in accordance  with Article
Four,  Section 1 of the  Corporation's  Articles of  Incorporation,  authorizing
5,000,000 shares of Preferred Stock (the "Preferred Stock"), $1.00 par value per
share,  approved  and  adopted on June 17, 1993 by the  affirmative  vote of the
holders of more than the requisite majority of the issued and outstanding shares
of Common  Stock of the  Corporation  entitled to vote  thereon  (being the only
voting capital stock of the Corporation then outstanding) in accordance with and
pursuant to the provisions of Article 2.13 of the Texas Business Corporation Act
(the "Act"),  the Board of Directors of the Corporation  does hereby approve and
adopt the following  resolutions  designating and  authorizing for issuance,  in
accordance  with  the  provisions  of  Article  2.13 of the  Act,  the  Series C
Preferred Stock of the Corporation,  said resolutions hereby effected being made
prior to  issuance  of any shares of Series C  Preferred  Stock,  such shares of
Series C Preferred Stock to consist of 1,000 shares,  each having a par value of
$1.00 per share, and each of which shares of Series C Preferred Stock shall have
the  dividend  rights,  voting  powers.   redemption   provisions,   liquidation
preferences  and the relative,  optional or other special  rights,  and shall be
subject to the  qualifications,  limitations or restrictions set forth below and
the remaining authorized shares of the Preferred Stock shall remain undesignated
and reserved for future  issuance  subject to the future  action of the Board of
Directors of the Corporation.

               Rights and Preferences of Series C Preferred Stock
               --------------------------------------------------

     1. Dividends.

          (a)  Amount  and  Payment  of  Dividend.  Subject  to the  limitations
hereinafter set forth, the holders of Series C Preferred Stock shall be entitled
to receive dividends at the rate of seven percent (7%) per annum of the original
issue price thereof of Ten Thousand and No/100 Dollars  ($10,000.00)  per share,
and no more,  payable  only at the time such  shares are  converted  pursuant to
Section  4  hereof.  Such  dividends  may be paid in cash or in shares of Common
Stock of the  Corporation as determined by the holders of the Series C Preferred
stock in its sole discretion;  provided, however, no fractional shares of either
security may be issued for  dividends any  fractional  shares will be rounded to
the nearest whole share,  and provided further that it any such dividend is paid
in whole or in part by  shares  of Common  Stock,  the  number of Shares of such
security to be issued as a stock  dividend  shall be  determined by the reported
market price of a share of the respective security on the last day of the period
for such stock dividend. Any shares of Series C Preferred Stock issued after the
date hereof shall accrue dividends from the date of issuance.

          (b) Cumulative  Rights.  To the extent,  if any, that dividends at the
rate set forth in Section  1(a) above shall not be paid or set apart in full for
the Series C Preferred  Stock,  the aggregate  deficiency shall be cumulated and
must be fully paid or set apart for  payment  before any  dividends  may be paid
upon or set  apart  for the  Common  Stock  of the  Corporation  or  before  the
Corporation  may  purchase  any  of its  Common  Stock  or  otherwise  make  any
distribution  on account of its Common Stock or any other class of capital stock
now or hereafter authorized or issued by the Corporation which ranks on a parity
with or  junior to the  Series C  Preferred  Stock  (other  than (i) a  dividend
payable in Common  Stock,  or (ii) by  conversion  into or exchange  for capital
stock of the  Corporation  ranking junior to the Series C Preferred  Stock as to
dividends).


<PAGE>


          (c) No Interest on Accrued  Dividends.  Any accumulations of dividends
on the Series C Preferred Stock shall not bear interest.

          (d)  Declaration.  Dividends on the Series C Preferred  Stock shall be
declared if when and as the Board of Directors of the  Corporation  shall in its
sole discretion deem advisable,  and only from the surplus of the Corporation as
such  shall  be  fixed  and  determined  by the said  Board  of  Directors.  The
determination  of the Board of  Directors  at any time of the  amount of surplus
available  for the payment of dividends  shall be binding and  conclusive on the
holders of the shares of Series C Preferred Stock then outstanding. If dividends
are not paid in full upon the Series C Preferred  Stock and any other  Preferred
Stock ranking on a parity as to dividends with the Series C Preferred Stock, all
dividends  declared upon shares of Series C Preferred  Stock and upon such other
shares of  Preferred  Stock will be  declared  pro rata so that in all cases the
amount of dividends  declared per share on the Series C Preferred Stock and such
other  Preferred  Stock  shall  bear  the  same  ratio  to each  other  that the
accumulated  dividends  per share on the shares of the Series C Preferred  Stock
and such other shares of Preferred Stock bear to each other.  The holders of the
Series C Preferred Stock shall not be entitled to receive any dividends  thereon
other  than the  dividends  provided  for in the  preceding  provisions  of this
Section.

     2.  Voting  Rights and Notice of Meeting.  The holders of the Common  Stock
shall have the  exclusive  right and power to vote an any matter  submitted to a
vote of the  shareholders  of the  Corporation  and the  holders of the Series C
Preferred  Stock shall have no right or power  whether  authorized by the Act or
otherwise to vote on any matter or in any  proceeding or to be represented at or
to receive notice of any meeting of the shareholders.

     3. Redemption.

     Neither the  Corporation  nor the  Holders of the Series C Preferred  Stock
shall have any rights of redemption as to the shares of Series C Preferred Stock
issued and outstanding.

     4. Conversion of Series C Preferred Stock.

          (a) Conversion  Right of Holder.  Each share of the Series C preferred
Stock shall be  convertible,  at the option of the holder  thereof,  at any time
after the due of initial  issuance of such share of Series C Preferred Stock and
up until 3 years  thereafter,  into either fully-paid and  non-assessable  whole
shares of Common Stock upon the terms and  conditions set forth in the following
paragraphs of this Section.  Nothing contained herein shall required the Company
to issue upon receipt of a notice of  conversion  in excess of 20% of its issued
and   outstanding   Common  Stock  as  provided  in  NASDAQ   Marketplace   Rule
4320(e)(21)(H)  (the "NASD 20% Rule") unless and until the shareholder  approval
has been  obtained by the Company.  In the event that the Company does not issue
its Common Stock after receipt of a conversion  notice  because of the 20% Rule,
then in such event,  the Company  shall pay to the holder 125% of the  principal
amount of Preferred  Stock issued and outstanding  plus accrued  interest within
five (5)  business  days of receipt of the faxed notice of  conversion  from the
holder.

<PAGE>


          (b) Automatic  Conversion.  The holder's conversion right shall expire
three (3) years  after the date of  issuance.  Upon three years from the date of
issuance,  all shares of Series C Preferred Stock that remain  outstanding  will
automatically  convert  into  shares  of the  Corporation's  Common  Stock.  The
Conversion  Rate to be  utilized  for the  automatic  conversion  shall the rate
specified  in Section  4(d) which  yields  the  largest  number of shares to the
holder.
 
          (c) Exercise of Conversion Right. Any holder of the Series C Preferred
Stock  electing to convert such stock into Common Stock pursuant to Section 4(a)
hereof shall deliver the  certificates  for the Series C Preferred  Stock to the
Corporation's principal office or the office of the Corporations Transfer Agent,
with  the  form  of  written  notice  to  the   Corporation   endorsed  on  such
certificate(s)  of his  election to convert  such Series C Preferred  Stock into
Common Stock duly filled out and executed.  The  conversion  right in respect of
any such  Series C Preferred  Stock  pursuant  to Section  4(a) hereof  shall be
deemed to have been  exercised  at the date on which the  holder  delivers  such
notice of  conversion  duly filled out and  executed to the  Corporation  or the
Corporation's  transfer  agent (the "Date of Election").  A facsimile  notice of
conversion will be accepted by the Corporation as a valid notice of election, so
long as the holder then delivers the original certificates within three business
days thereafter.  The person entitled to receive the Series A Preferred Stock or
Common Stock issuable upon such conversion  shall be treated for all purposes as
the record holder of such  security on such date;  provided,  however,  that the
conversion  right in respect of any notice  received after the close of business
(11:59 PM EST) on any day shall not be deemed to have been  exercised  until the
succeeding  business day. As soon as practicable,  and in any event within three
(3) business days after the date of receipt of the original  certificates of any
Series C Preferred  Stock to be converted  pursuant to Section 4(a) hereof,  the
Corporation  shall  deliver  to  the  person  entitled  thereto,  certificate(s)
representing  the shares of Series A  Preferred  Stock or Common  Stock to which
such  person  shall  be  entitled  on such  conversion.  The  Corporation,  as a
condition to the exercise of such rights of conversion,  may require the payment
of a sum  equal  to any  transfer  tax or  other  governmental  charge  (but not
including  any tax  payable  upon  the  issue  of stock  deliverable  upon  such
conversion) that may be imposed or required by law, upon any transfer incidental
or prior thereto, or the submission of proper proof that the same has been paid.

          (d)  Conversion  Rate.  The number of shares of Common Stock  issuable
upon conversion of each share of Series C Preferred Stock shall be as follows:
 
               (1) [LEFT INTENTIONALLY BLANK]

<PAGE>


               (2) Conversion  into Common Stock.  Equal to $10,000,  divided by
80% of the average closing bid price of the Common Stock during the five trading
day period  immediately  proceeding  the Date of  Election as defined in Section
4(a) hereof. In addition,  the Corporation shall not be required,  in connection
with my such conversion,  to issue a fraction of a share of its Common Stock nor
to deliver any stock certificate representing a fraction thereof.
  
               (3)  Limitations  on  Conversion.  Any  holder  of the  Series  C
Preferred  Stock will be allowed to convert 50% of the aggregate  amount of such
holders  Series C  Preferred  Stock  beginning  the day after  the  registration
statement  registering  the Common  Stock has been  declared  effective,  but no
sooner  than 60 days from the date the Series C Preferred  Stock is issued.  Any
holder of the Series C  Preferred  Stock will be allowed to convert  any and all
remaining  shares of holder's  Series C Preferred Stock be within 120 days after
the issuance of the Series C Preferred Stock; provided,  however, that if on the
120th day after the  issuance of the Series C Preferred  Stock the  registration
statement  has not yet been  declared  effective all holders must wait until the
registration  statement is declared  effective before  converting any and all of
their Series C Preferred Stock.

          (e)  Adjustment  of  Conversion  Rate.  The number of shares of Common
Stock into which share of the Series C Preferred  Stock is convertible  shall be
subject to adjustment from time to time in certain instances, as follows:
  
               (1)  On   Recapitalization.   On  any   recapitalization  of  the
Corporation  through the  subdivision or combination of its  outstanding  Common
Stock into a greater or smaller number of shares, the number of shares of Common
Stock into which the shares of Series C Preferred  Stock may be converted  shall
be increased or reduced in the same proportion.
      
               (2) On Capital Reorganization,  Reclassification,  Consolidation,
Merger   or  Sale  of   Corporate   Assets.   On  my   capital   reorganization,
reclassification  of the  capital  stock,  consolidation,  merger,  or  sale  or
conveyance  of all or  substantially  all of the  assets of the  Corporation  to
another corporation, each share of Series C Preferred Stock shall be convertible
into the same kind and amounts of securities,  including shares or other assets,
or both,  into which the number of shares of  capital  stock of the  Corporation
which  would have been  deliverable  on  conversion  of such  shares of Series C
Preferred  stock  immediately  prior to such  reorganization,  reclassification,
consolidation,  merger, sale or conveyance would have been entitled. Appropriate
adjustments,  as determined by the Board of Directors of the Corporation,  shall
be made in the  application of the  provisions  herein set forth with respect to
the rights and  interests  thereafter  of the  holders of the Series C Preferred
Stock so that said provisions,  including the provisions with respect to changes
in,  and  other  adjustments  of,  the  Conversion  Rate,  shall  thereafter  be
applicable,  as nearly as  reasonably  may be, in relation to any  securities or
other assets  thereafter  deliverable  on  conversion  of the shares of Series C
Preferred Stock.

<PAGE>


          (f)  Statement  of Adjusted  Amount.  Whenever the amount of shares of
Common Stock  deliverable on the conversion of Series C Preferred Stock shall be
adjusted  pursuant to the provisions  hereof,  the  Corporation  shall forthwith
maintain at its office and file with the transfer  agent or agents,  a statement
signed by the President or Vice  President of the  Corporation  and by its Chief
Financial Officer, stating the adjusted amount of any securities deliverable for
each share of Series C Preferred Stock,  calculated to the nearest one hundredth
(1/100) share, and setting forth in reasonable  detail the method of calculation
and the facts  requiring such  adjustment and on which the calculation is based.
Each adjustment shall remain in effect until a subsequent  adjustment  hereunder
is required.

          (g) Fractional  Shares.  Neither  fractional shares nor scrip or other
certificates  evidencing such shares shall be issued on conversion of the Series
C  Preferred  Stock as  herein  provided,  but the  Corporation  shall,  in lieu
thereof, round all such fractional shares to the nearest whole share.
    
          (h) Payment of Taxes on  Conversion of Series C Preferred  Stock.  The
Corporation  shall pay any and all issue and other  taxes that may be payable in
respect of any issue or  delivery  of Common  Stock on  conversion  of shares of
Series C Preferred Stock pursuant hereto. The Corporation shall not, however, be
required to pay any tax which may be payable in respect of any transfer involved
in the issue and delivery of Common Stock in a name other than that in which the
shares of Series C Preferred  Stock so  converted  were  registered  and no such
issue or delivery  shall be made unless and until the person  requesting  it has
paid to the Corporation the amount of any such tax, or has  established,  to the
satisfaction of the Corporation, that such tax has been paid.

          (i)  Reservation of Sufficient  Common Stock. So long as any shares of
Series C Preferred Stock shall remain  outstanding and the holders thereof shall
have the right to convert said shares in accordance  with the provisions of this
Section 4, the  Corporation  will at all times reserve from the  authorized  and
unissued shares of its Common Stock a sufficient number of shares to provide for
such  conversions,  and  will  take  such  other  corporation  action  as may be
necessary  from time to time in order  that it may  validly  and  legally  issue
fully-paid and non-assessable shares of such Common Stock upon conversion of the
Series C Preferred Stock.

          (j) Definition of Common Stock.  In each case where  reference is made
to the Common  Stock of the  Corporation  in this  Section,  unless a  different
intention is expressed, such reference is to the series or class of Common Stock
of the  Corporation  as such series or class of stock  exists at the date of the
adoption of these  provisions,  or stock into which the same may be changed from
time to time.
 
          (k)  Status of  Converted  Preferred  Shares.  All  shares of Series C
Preferred Stock so converted shall be canceled and such shares shall be restored
to the status of authorized but unissued shares of Preferred Stock.

<PAGE>

 
     5. Liquidation Rights.

          (a) Liquidation  Preference  Amount.  In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the business or affairs of
the Corporation, and after payment of, or adequate provision for payment of, the
debt  liabilities and other claims of the Corporation as determined by its Board
of Directors,  each holder of the Series C Preferred  Stock shall be entitled to
receive,  out of the remaining net assets of the Corporation  legally  available
for distribution to its shareholders,  before any payment or distribution  shall
be made on the Common Stock,  or on any other class of stock of the  Corporation
ranking junior to the shares of Series C Preferred Stock upon  liquidation,  the
amount of Ten Thousand  and No/100  Dollars  ($10,000.00)  per share of Series C
Preferred Stock,  plus all accrued and unpaid dividends on each such share up to
the date fixed for distribution.

          (b) Proportionate Distribution Where Assets Insufficient. In the event
the assets of the  Corporation  available  for  distribution  to the  holders of
shares of Series C Preferred Stock upon  dissolution,  liquidation or winding up
of the Corporation  whether  voluntary or involuntary,  shall be insufficient to
pay in full all amounts to which such holders are entitled pursuant to paragraph
(a) of this Section, no such distribution shall be made on account of any shares
of any class of capital  stock of the  Corporation  ranking on a parity with the
shares of Series C Preferred Stock upon such dissolution, liquidation or winding
up unless  proportionate  distributive  amounts  shall be paid on account of the
shares  of  Series  C  Preferred  Stock,  ratably,  in  proportion  to the  full
distributable   amounts  for  which  holders  of  all  such  parity  shares  are
respectively entitled upon such dissolution, liquidation or winding up.

          (c)  Nonparticipation  Right.  After the payment to the holders of the
shares of Series C Preferred Stock of the full preferential amounts provided for
in either  paragraph (a) or (b) of this Section,  as applicable,  the holders of
Series  C  Preferred  Stock as such  shall  have no right or claim to any of the
remaining assets of the Corporation.
        
          (d) Excluded Transactions. Neither the consolidation nor merger of the
Corporation with or into any other corporation, nor the sale, mortgage, exchange
or conveyance of all or substantially all of the properties,  assets or business
of the  Corporation,  nor any  liquidation,  dissolution  or  winding  up of the
Corporation occurring substantially concurrently with any such transaction shall
be deemed to be a  liquidation,  dissolution  or winding  up of the  Corporation
within the meaning hereof, unless otherwise determined by the Board of Directors
of the Corporation.

     6. No  Preemptive  Rights.  No holder of shares of the  Series C  Preferred
Stock  shall,  as such  holder,  have any  preemptive  right to  subscribe to or
purchase  any shares of any class of  capital  stock of the  Corporation  now or
hereafter  authorized  or issued,  whether or not  exchangeable  for any capital
stock of the Corporation of any class or classes now or hereafter  authorized or
issued;  nor shall any holder of shares of the Series C Preferred Stock, as such
holder,  have any right to  purchase,  acquire or subscribe  for any  securities
which the  Corporation  may issue or sell  whether  or not  convertible  into or
exchangeable  for shares of  capital  stock of the  Corporation  of any class or
classes,  and whether or not any such  securities  have attached or  appurtenant
thereto warrants, options or other instruments which entitle the holders thereof
to purchase,  acquire or subscribe  for shares of capital  stock of any class or
classes of the Corporation.

<PAGE>


     7.  Determination  of Market  Value of Capital  Stock of  Corporation.  The
determination  of the per share  market  value of  Common  Stock as set forth in
previous  Sections  shall be  determined  using the  previous  five day  average
closing bid price for the day or, where no sale is made on that day, the average
of the closing bid and asked prices for that day as reported by the NASDAQ Small
Cap - Issue System if the securities are at the time listed thereon or, if it is
not so  listed,  on any  other  national  securities  exchange  selected  by the
Corporation on which it is at the time listed. If the Common Stock is not at the
time  listed an any  national  securities  exchange,  its  market  value for the
purposes  hereof  shall be the  average  closing  bid price  for the last  three
trading days the Common Stock was listed on any national securities exchange.

     8. Covenants of the Corporation.  The Corporation will not, by amendment to
its  Articles  of  Incorporation,  as amended,  or through  any  reorganization,
transfer  of  assets,  consolidation,  merger,  dissolution,  issue  or  sale of
securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of the  preferences and limitations of Series
C Preferred Stock to be observed or performed hereunder by the Corporation,  but
will at all times in good faith assist in the carrying out of all the provisions
set forth herein  relating to Series C Preferred  Stock and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the  holders  of  the  Series  C  Preferred  Stock  against  dilution  or  other
impairment.

     IN  WITNESS  WHEREOF,  HARVEST  RESTAURANT  GROUP,  INC.  has  caused  this
Statement  of  Resolution  Establishing  Series of Shares to be signed by Steves
Rosser, its Vice-President and Secretary, this 8th day of July, 1999.

                                           HARVEST RESTAURANT GROUP, INC.


                                           By: /s/ Steves Rosser
                                               STEVES ROSSER,
                                               Vice-President and Secretary





<PAGE>


                         HARVEST RESTAURANT GROUP, INC.
                              (a Texas corporation)
                              ---------------------


                             STATEMENT OF RESOLUTION
                     ESTABLISHING SERIES OF PREFERRED STOCK
                     --------------------------------------

                      Series D Convertible Preferred Stock


To:  The Secretary of State
     Of the State of Texas


     Pursuant to the previous of Article 2.13 of the Texas Business  Corporation
Act (the "Act"),  the undersigned  corporation,  HARVEST RESTAURANT GROUP, INC.,
formerly CluckCorp International,  Inc. (the "Corporation"),  hereby submits the
following  statement of the purpose of establishing  and designating a series of
shares of preferred  stock to be known as Series D Convertible  Preferred  Stock
and fixing and determining the relative rights and preferences thereof:

                                  ARTICLE ONE

                                      NAME
                                      ----

     1. The name of the corporation is HARVEST  RESTAURANT  GROUP,  INC. and the
charter number of the Corporation is 01274398.


                                  ARTICLE TWO

                              CORPORATE RESOLUTIONS
                              ---------------------

     1. Be it known that on May 19, 1997, the  Corporation  had  established and
designated  3,000,000  shares  of its  preferred  stock as  Series A  Redeemable
Convertible  Preferred Stock ("Series A Preferred Stock"); on December 15, 1997,
the  Corporation  had  established  and designated  1000 shares of its preferred
stock as Series B Convertible  Preferred Stock ("Series B Preferred Stock"); and
on July 2, 1998, the  Corporation  had established and designated 1000 shares of
its preferred stock as Series C Convertible Preferred Stock ("Series C Preferred
Stock").

     2. The following  resolution  establishing  and  designating  an additional
series of preferred  stock,  known as: the Series D Convertible  Preferred Stock
(the "Series D Preferred Stock"), and fixing and determining the relative rights
and  preferences  thereof  was duly  adopted  by the Board of  Directors  of the
Corporation on December 22, 1998.  This  resolution  supercedes the Statement of
Resolution Establishing Series of Preferred Stock, known as Series D Convertible
Preferred Stock,  that was filed with the Secretary of State of Texas on January
14,  1999.  The  Series  D  Preferred  Stock  has  been  created  as  part  of a
recapitalization  of the  Corporation  and the Series D Preferred  Stock will be
issued for cash and in exchange for all outstanding shares of Series B Preferred
Stock and all  outstanding  shares of Series C  Preferred  Stock.  The  Series D
Preferred Stock shall rank junior to the Series A Preferred Stock.

<PAGE>


BE IT RESOLVED that,  pursuant to the authority  expressly granted and vested in
the Board of Directors  of the  Corporation  in  accordance  with Article  Four,
Section 1 of the Corporation's Articles of Incorporation,  authorizing 5,000,000
shares of Preferred  Stock (the "Preferred  Stock"),  $1.00 par value per share,
approved and adopted on June 17, 1993 by the affirmative  vote of the holders of
more than the requisite  majority of the issued and outstanding shares of Common
Stock of the Corporation entitled to vote thereon (being the only voting capital
stock of the  Corporation  then  outstanding) in accordance with and pursuant to
the  provisions  of  Article  2.13 of the Texas  Business  Corporation  Act (the
"Act"),  the Board of Directors of the Corporation does hereby approve and adopt
the  following   resolutions   designating  and  authorizing  for  issuance,  in
accordance  with the  provisions  of Article 2.13 of the Act,  Nine Thousand Two
Hundred (9,200) shares of the Series D Preferred Stock of the Corporation,  each
having a par value of $1.00 per share,  said  resolutions  hereby effected being
made prior to the  issuance  of any  shares of Series D  Preferred  Stock,  such
shares of Series D Preferred Stock to be exchanged for the outstanding shares of
Series B  Preferred  Stock  and the  shares  of Series C  Preferred  Stock,  and
purchased  for cash in the amount  subscribed  to,  and each of which  shares of
Series  D  Preferred  Stock  shall  have the  dividend  rights,  voting  powers,
redemption provisions,  liquidation  preferences and the relative,  optional and
other special rights, and shall be subject to the qualifications, limitations or
restrictions  set  forth  below;  and the  remaining  authorized  shares  of the
Preferred  Stock shall remain  undesignated  and  reserved  for future  issuance
subject to the future action of the Board of Directors of the Corporation.


                                 ARTICLE THREE

               RIGHTS AND PREFERENCES OF SERIES D PREFERRED STOCK
               --------------------------------------------------

     1. Dividends.

          (a)  Amount  and  Payment  of  Dividend.  Subject  to the  limitations
hereinafter set forth, the holders of Series D Preferred Stock shall be entitled
to receive dividends at the rate of seven percent (7%) per annum of the original
issue price thereof of One Thousand and No/100  Dollars  ($1,000.00)  per share,
and no more,  payable  only at the time such  shares are  converted  pursuant to
Section  4  hereof.  Such  dividends  may be paid in cash or in shares of Common
Stock of the  Corporation as determined by the holders of the Series D Preferred
Stock in their sole  discretion;  provided,  however,  no  fractional  shares of
either  security  may be issued for  dividends,  any  fractional  shares will be
rounded to the  nearest  whole  share,  and  provided  further  that if any such
dividend  is paid in whole or in part by shares of Common  Stock,  the number of
shares of such security to be issued as a stock  dividend shall be determined by
the Market  Value (as defined in Section 7 below) of a share of Common  Stock as
of the last day of the period for such  stock  dividend.  Any shares of Series D
Preferred  Stock issued after the date hereof shall accrued  dividends  from the
date of issuance.

          (b) Cumulative  Rights.  To the extent,  if any, that dividends at the
rate set forth in Section  1(a) above shall not be paid or set apart in full for
the Series D Preferred  Stock,  the aggregate  deficiency shall be cumulated and
must be fully paid or set apart for  payment  before any  dividends  may be paid
upon or set  apart  for the  Common  Stock  of the  Corporation  or  before  the
Corporation  may  purchase  any  of its  Common  Stock  or  otherwise  make  any
distribution  on account of its Common Stock or any other class of capital stock
now or hereafter authorized or issued by the Corporation which ranks on a parity
with or  junior to the  Series D  Preferred  Stock  (other  than (i) a  dividend
payable in Common Stock,  (ii) by conversion  into or exchange for capital stock
of the  Corporation  ranking  junior  to the  Series  D  Preferred  Stock  as to
dividends, or (iii) a dividend payable in compliance with Section 1(d) below).

<PAGE>


          (c) No Interest on Accrued  Dividends.  Any accumulations of dividends
on the Series D Preferred Stock shall not bear interest.

          (d)  Declaration.  Dividends on the Series D Preferred  Stock shall be
declared if, when and as the Board of Directors of the Corporation  shall in its
sole discretion deem advisable,  and only from the surplus of the Corporation as
such  shall  be  fixed  and  determined  by the said  Board  of  Directors.  The
determination  of the Board of  Directors  at any time of the  amount of surplus
available  for the payment of dividends  shall be binding and  conclusive on the
holders of the shares of Series D Preferred Stock then outstanding. If dividends
are not paid in full upon the Series D Preferred  Stock and any other  Preferred
Stock ranking on a parity as to dividends with the Series D Preferred Stock, all
dividends  declared upon shares of Series D Preferred  Stock and upon such other
shares of  Preferred  Stock will be  declared  pro rata so that in all cases the
amount of dividends  declared per share on the Series D Preferred Stock and such
other  Preferred  Stock  shall  bear the  same  ratio to each  other  that  that
accumulated  dividends  per share on the shares of the Series D Preferred  Stock
and such other shares of Preferred Stock bear to each other.  The holders of the
Series D Preferred Stock shall not be entitled to receive any dividends  thereon
other  than the  dividends  provided  for in the  preceding  provisions  of this
Section.

     2. Voting  Rights and Notice of  Meetings.  The holders of the Common Stock
shall have the  exclusive  right and power to vote on any matter  submitted to a
vote of the  shareholders  of the  Corporation,  and the holders of the Series D
Preferred  Stock shall have no right or power  whether  authorized by the Act or
otherwise to vote on any matter or in any  proceeding or to be represented at or
to receive notice of any meeting of the shareholders.
 
     3. Redemption.

          Neither  the  Corporation  nor the  Holders of the Series D  Preferred
Stock shall have any rights of redemption as to the shares of Series D Preferred
Stock issued and outstanding.



     4. Conversion of Series D Preferred Stock.

          (a) Conversion  Right of Holder.  Each share of the Series D Preferred
Stock shall be  convertible,  at the option of the holder  thereof,  at any time
after the date of initial  issuance  of such share of Series D  Preferred  Stock
(subject to Section  4(d)(3)  below) and up until three years  thereafter,  into
fully-paid  and  non-assessable  whole shares of Common Stock upon the terms and
conditions  set  forth in the  following  paragraphs  of this  Section.  Nothing
contained herein shall required the Company to issue upon receipt of a notice of
conversion  in excess  of 20% of its  issued  and  outstanding  Common  Stock as
provided in NASDAQ Marketplace Rule  4320(e)(21)(H) (the "NASD 20% Rule") unless
and until the  shareholder  approval has been  obtained by the  Company.  In the
event  that the  Company  does not issue its  Common  Stock  after  receipt of a
conversion notice because of the 20% Rule, then in such event, the Company shall
pay to the holder 125% of the  principal  amount of Preferred  Stock for which a
notice of conversion was given and which was not converted for such reason, plus
accrued interest within five (5) business days of receipt of the faxed notice of
conversion from such holder.

<PAGE>


          (b) Automatic  Conversion.  The holder's conversion right shall expire
three (3) years  after the date of  issuance.  Upon three years from the date of
issuance,  all shares of Series D Preferred Stock that remain  outstanding  will
automatically  convert  into  shares  of the  Corporation's  Common  Stock.  The
Conversion  Rate to be  utilized  for the  automatic  conversion  shall the rate
specified  in Section  4(d) which  yields  the  largest  number of shares to the
holder.
 
          (c) Exercise of Conversion Right. Any holder of the Series D Preferred
Stock  electing to convert such stock into Common Stock pursuant to Section 4(a)
hereof shall deliver the  certificates  for the Series D Preferred  Stock to the
Corporation's  principal  office  or the  office of the  Corporation's  Transfer
Agent,  with the form of  written  notice to the  Corporation  endorsed  on such
certificate(s)  of his  election to convert  such Series D Preferred  Stock into
Common Stock duly filled out and executed.  The  conversion  right in respect of
any such  Series D Preferred  Stock  pursuant  to Section  4(a) hereof  shall be
deemed to have been  exercised  at the date on which the  holder  delivers  such
notice of  conversion  duly filled out and  executed to the  Corporation  or the
Corporation's  transfer  agent (the "Date of Election").  A facsimile  notice of
conversion will be accepted by the Corporation as a valid notice of election, so
long as the holder then delivers the original certificates within three business
days  thereafter.  The person entitled to receive the Common Stock issuable upon
such  conversion  shall be treated for all purposes as the record holder of such
security on such date; provided,  however,  that the conversion right in respect
of any  notice  receive  after the close of  business  (11:59 PM EST) on any day
shall not be deemed to have been exercised  until the next  succeeding  business
day. As soon as  practicable,  and in any event within  three (3) business  days
(five business days if the Common Stock is then being quoted on the OTC Bulletin
Board)  after the date of receipt of the original  certificates  of any Series D
Preferred Stock to be converted pursuant to Section 4(a) hereof, the Corporation
shall deliver to the person entitled  thereto,  certificate(s)  representing the
shares  of  Common  Stock  to  which  such  person  shall  be  entitled  on such
conversion.  The  Corporation,  as a condition to the exercise of such rights of
conversion,  may require the payment of a sum equal to any transfer tax or other
governmental  charge (but not  including any tax payable upon the issue of stock
deliverable  upon such  conversion) that may be imposed or required by law, upon
any transfer incidental or prior thereto, or the submission of proper proof that
the same has been paid.

          (d)  Conversion  Rate.  The number of shares of Common Stock  issuable
upon conversion of each share of Series D Preferred Stock shall be as follows:

               (1) [LEFT INTENTIONALLY BLANK]

               (2) Conversion into Common Stock. Equal to $1,000, divided by 80%
of the Market  Value (as defined in Section 7 below) as of the Date of Elections
defined in Section  4(a)  hereof.  In  addition,  the  Corporation  shall not be
required, in connection with any such conversion, to issue a fraction of a share
of its Common Stock nor to deliver any stock certificate representing a fraction
thereof.

               (3)  Limitations  on  Conversion.  Any  holder  of the  Series  D
Preferred Stock will be allowed to convert the aggregate amount of such holder's
Series D Preferred  Stock  beginning  the day after the  registration  statement
registering  the Common Stock has been declared  effective by the Securities and
Exchange  Commission,  but no  sooner  than 120  days  after  the  Corporation's
shareholders approve an amendment to the Corporation's Articles of Incorporation
increasing  the  number of  authorized  shares of Common  Stock to not less than
100,000,000  (the  "Shareholders  Meeting").  If on  the  120th  day  after  the
Shareholders  Meeting  the  registration  statement  has not yet  been  declared
effective,  all holders must wait until the  registration  statement is declared
effective before converting any and all of their Series D Preferred Stock.

<PAGE>


          (e)  Adjustment  of  Conversion  Rate.  The number of shares of Common
Stock into which each share of the Series D Preferred Stock is convertible shall
be subject to adjustment from time to time in certain instances, as follows:

               (1)  On   Recapitalization.   On  any   recapitalization  of  the
Corporation  through the  subdivision or combination of its  outstanding  Common
Stock into a greater or smaller number of shares, the number of shares of Common
Stock into which the shares of Series D Preferred  Stock may be converted  shall
be increased or reduced in the same proportion.

               (2) On Capital Reorganization,  Reclassification,  Consolidation,
Merger  or  Sale  of   Corporate   Assets.   On  any   capital   reorganization,
reclassification  of the  capital  stock,  consolidation,  merger,  or  sale  or
conveyance  of all or  substantially  all of the  assets of the  Corporation  to
another corporation, each share of Series D Preferred Stock shall be convertible
into the same kind and amounts of securities,  including shares or other assets,
or both, that the holder of such share would have received had he converted such
share of Series D Preferred  Stock into Common Stock  immediately  prior to such
reorganization,  reclassification,  consolidation,  merger,  sale or conveyance.
Appropriate  adjustments,  as  determined  by  the  Board  of  Directors  of the
Corporation, shall be made in the application of the provisions herein set forth
with respect to the rights and interests thereafter of the holders of the Series
D Preferred Stock so that said provisions, including the provisions with respect
to changes in, and other  adjustments of, the Conversion  Rate, shall thereafter
be applicable,  as nearly as reasonably may be, in relation to any securities or
other assets  thereafter  deliverable  on  conversion  of the shares of Series D
Preferred Stock.

          (f)  Statement  of Adjusted  Amount.  Whenever the amount of shares of
Common Stock  deliverable on the conversion of Series D Preferred Stock shall be
adjusted  pursuant to the provisions  hereof,  the  Corporation  shall forthwith
maintain at its office and file with the transfer  agent or agents,  a statement
signed by the President or Vice  President of the  Corporation  and by its Chief
Financial Officer, stating the adjusted amount of any securities deliverable for
each share of Series D Preferred Stock,  calculated to the nearest one hundredth
(1/100) share, and setting forth in reasonable  detail the method of calculation
and the facts  requiring such  adjustment and on which the calculation is based.
Each adjustment shall remain in effect until a subsequent  adjustment  hereunder
is required.

          (g) Fractional  Shares.  Neither  fractional shares nor scrip or other
certificates  evidencing such shares shall be issued on conversion of the Series
D  Preferred  Stock as  herein  provided,  but the  Corporation  shall,  in lieu
thereof, round all such fractional shares to the nearest whole share.

          (h) Payment of Taxes on  Conversion of Series D Preferred  Stock.  The
Corporation  shall pay any and all issue and other  taxes that may be payable in
respect of any issue or  delivery  of Common  Stock on  conversion  of shares of
Series D Preferred Stock pursuant hereto. The Corporation shall not, however, be
required to pay any tax which may be payable in respect of any transfer involved
in the issue and delivery of Common Stock in a name other than that in which the
shares of Series D Preferred  Stock so converted  were  registered,  and no such
issue or delivery  shall be made unless and until the person  requesting  it has
paid to the Corporation the amount of any such tax, or has  established,  to the
satisfaction of the Corporation, that such tax has been paid.

<PAGE>


          (i)  Reservation of Sufficient  Common Stock. So long as any shares of
Series D Preferred Stock shall remain  outstanding and the holders thereof shall
have the right to convert said shares in accordance  with the provisions of this
Section 4, the  Corporation  will at all times  after the  Shareholders  Meeting
reserve from the authorized and unissued shares of its Common Stock a sufficient
number of shares  to  provide  for such  conversions,  and will take such  other
corporation  action as may be  necessary  from time to time in order that it may
validly and legally issue  fully-paid and  non-assessable  shares of such Common
Stock upon conversion of the Series D Preferred Stock.

          (j) Definition of Common Stock.  In each case where  reference is made
to the Common  Stock of the  Corporation  in this  Section,  unless a  different
intention is expressed, such reference is to the series or class of Common Stock
of the  Corporation  as such series or class of stock  exists at the date of the
adoption of these  provisions,  or stock into which the same may be changed from
time to time.

          (k)  Status of  Converted  Preferred  Shares.  All  shares of Series D
Preferred Stock so converted shall be canceled and such shares shall be restored
to the status of authorized but unissued shares of Preferred Stock.



     5. Liquidation Rights.

          (a) Liquidation  Preference  Amount.  In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the business or affairs of
the Corporation, and after payment of, or adequate provision for payment of, the
debts,  liabilities  and other claims of the  Corporation  as  determined by its
Board of  Directors,  each  holder  of the  Series D  Preferred  Stock  shall be
entitled to receive,  out of the remaining net assets of the Corporation legally
available  for  distribution  to  its   shareholders,   before  any  payment  or
distribution  shall be made on the Common Stock,  or on any other class of stock
of the Corporation ranking junior to the shares of Series D Preferred Stock upon
liquidation, the amount of One Thousand and No/100 Dollars ($1,000.00) per share
of Series D Preferred Stock,  plus all accrued and unpaid dividends on each such
share up to the date fixed for distribution.

          (b) Proportionate Distribution Where Assets Insufficient. In the event
the assets of the  Corporation  available  for  distribution  to the  holders of
shares of Series D Preferred Stock upon  dissolution,  liquidation or winding up
of the Corporation,  whether voluntary or involuntary,  shall be insufficient to
pay in full all amounts to which such holders are entitled pursuant to paragraph
(a) of this Section, no such distribution shall be made on account of any shares
of any class of capital  stock of the  Corporation  ranking on a parity with the
shares of Series D Preferred Stock upon such dissolution, liquidation or winding
up unless  proportionate  distributive  amounts  shall be paid on account of the
shares  of  Series  D  Preferred  Stock,  ratably,  in  proportion  to the  full
distributable   amounts  for  which  holders  of  all  such  parity  shares  are
respectively entitled upon such dissolution, liquidation or winding up.

          (c)  Nonparticipation  Right.  After the payment to the holders of the
shares of Series D Preferred Stock of the full preferential amounts provided for
in either  paragraph (a) or (b) of this Section,  as applicable,  the holders of
Series  D  Preferred  Stock as such  shall  have no right or claim to any of the
remaining assets of the Corporation.

<PAGE>


          (d) Excluded Transactions. Neither the consolidation nor merger of the
Corporation with or into any other corporation, nor the sale, mortgage, exchange
or conveyance of all or substantially all of the properties,  assets or business
of the  Corporation,  nor any  liquidation,  dissolution  or  winding  up of the
Corporation occurring substantially concurrently with any such transaction shall
be deemed to be a  liquidation,  dissolution  or winding  up of the  Corporation
within the meaning hereof, unless otherwise determined by the Board of Directors
of the Corporation.

     6. No  Preemptive  Rights.  No holder of shares of the  Series D  Preferred
Stock  shall,  as such  holder,  have any  preemptive  right to  subscribe to or
purchase  any shares of any class of  capital  stock of the  Corporation  nor or
hereafter  authorized  or issued,  whether or not  exchangeable  for any capital
stock of the Corporation of any class or classes now or hereafter  authorized or
issued;  nor shall any holder of shares of the Series D Preferred Stock, as such
holder,  have any right to  purchase,  acquire or subscribe  for any  securities
which the  Corporation  may issue or sell  whether  or not  convertible  into or
exchangeable  for shares of  capital  stock of the  Corporation  of any class or
classes,  and whether or not any such  securities  have attached or  appurtenant
thereto warrants, options or other instruments which entitle the holders thereof
to purchase,  acquire or subscribe  for shares of capital  stock of any class or
classes of the Corporation.

     7.  Determination  of Market  Value of Capital  Stock of  Corporation.  The
determination  of the per share  "Market  Value" of Common Stock as set forth in
previous  Sections  shall be  determined  using the  previous  five day  average
closing bid price for the day or, where no sale is made on that day, the average
of the closing bid and asked  prices for that day on the NASDAQ  Stock Market or
the OTC  Bulletin  Board if the  securities  are at the time  listed  or  quoted
thereon,  respectively,  or,  if it is not so  listed  or  quoted,  on any other
national  securities  exchange selected by the Corporation on which it is at the
time  listed.  If at the  applicable  time the Common Stock is quoted on the OTC
Bulletin Board, the foregoing  calculations  shall be based on a Trade and Quote
Summary Report from the OTC Bulletin Board Research Service if available, and if
not, on any other publicly  available  data  reasonably  deemed  reliable by the
Corporation.

     8. Covenants of the Corporation.  The Corporation will not, by amendment to
its  Articles  of  Incorporation,  as amended,  or through  any  reorganization,
transfer  of  assets,  consolidation,  merger,  dissolution,  issue  or  sale of
securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of the  preferences and limitations of Series
D Preferred Stock to be observed or performed hereunder by the Corporation,  but
will at all times in good faith assist in the carrying out of all the provisions
set forth herein  relating to Series D Preferred  Stock and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the  holders  of  the  Series  D  Preferred  Stock  against  dilution  or  other
impairment.

     IN  WITNESS  WHEREOF,  HARVEST  RESTAURANT  GROUP,  INC.  has  caused  this
Statement of Resolution Establishing Series of Shares to be signed by Timothy R.
Robinson, its Chief Financial Officer, this _______ day of February, 1999.

                                         HARVEST RESTAURANT GROUP, INC.


                                         By:

                                         Name:

                                         Title:


<PAGE>

                         HARVEST RESTAURANT GROUP, INC.
                              (a Texas corporation)
                              ---------------------


                             STATEMENT OF RESOLUTION
                     ESTABLISHING SERIES OF PREFERRED STOCK
                     --------------------------------------

                      Series E Convertible Preferred Stock


To:  The Secretary of State
     of the State of Texas

     Pursuant  to  the   provisions  of  Article  2.13  of  the  Texas  Business
Corporation Act (the "Act"),  the undersigned  corporation,  HARVEST  RESTAURANT
GROUP, INC., (the "Corporation"), hereby submits the following statement for the
purpose of establishing and designating a series of shares of preferred stock to
be known as Series E Convertible  Preferred Stock and fixing and determining the
relative rights and preferences thereof:


                                  ARTICLE ONE

                                      NAME
                                      ----

     1. The name of the Corporation is HARVEST  RESTAURANT GROUP,  INC., and the
charter number of the Corporation is 01274398.


                                  ARTICLE TWO

                              CORPORATE RESOLUTIONS
                              ---------------------

     1. Be it known that on May 19, 1997 the  Corporation  had  established  and
designated  3,000,000  shares  of its  preferred  stock as  Series A  Redeemable
Convertible  Preferred  Stock  ("Series A Preferred  Stock") and on December 22,
1997  the  Corporation  had  established  and  designated  1,000  shares  of its
preferred  stock as Series B Convertible  Preferred  Stock  ("Series B Preferred
Stock"),  on July 2, 1998 the Corporation  had established and designated  1,000
shares of its preferred stock as Series C Convertible Preferred Stock ("Series C
Preferred Stock"), and on December 22, 1998, the Corporation had established and
designated 8,600 shares of its preferred stock as Series D Convertible Preferred
Stock ("Series D Preferred Stock") for which all outstanding  shares of Series B
Preferred Stock and Series C Preferred Stock were exchanged.

     2. The following  resolution  establishing  and  designating  an additional
series of preferred  stock,  known as: the Series E Convertible  Preferred Stock
(the "Series E Preferred Stock"), and fixing and determining the relative rights
and  preferences  thereof  was duly  adopted  by the Board of  Directors  of the
Corporation on December 22, 1998. The Series E Preferred Stock shall rank junior
to the Series A Preferred Stock and the Series D Preferred Stock.

<PAGE>


     BE IT RESOLVED that, pursuant to the authority expressly granted and vested
in the Board of Directors of the  Corporation  in accordance  with Article Four,
Section 1 of the Corporation's Articles of Incorporation,  authorizing 5,000,000
shares of Preferred  Stock (the "Preferred  Stock"),  $1.00 par value per share,
approved and adopted on June 17, 1993 by the affirmative  vote of the holders of
more than the requisite  majority of the issued and outstanding shares of Common
Stock of the Corporation entitled to vote thereon (being the only voting capital
stock of the  Corporation  then  outstanding) in accordance with and pursuant to
the  provisions  of  Article  2.13 of the Texas  Business  Corporation  Act (the
"Act"),  the Board of Directors of the Corporation does hereby approve and adopt
the  following   resolutions   designating  and  authorizing  for  issuance,  in
accordance with the provisions of Article 2.13 of the Act, 745,000 shares of the
Series E Preferred  Stock of the  Corporation,  each having a par value of $1.00
per share, said resolutions  hereby effected being made prior to the issuance of
any shares of Series E  Preferred  Stock,  and each of which  shares of Series E
Preferred  Stock  shall have the  dividend  rights,  voting  powers,  redemption
provisions,  liquidation preferences and the relative, optional or other special
rights, and shall be subject to the qualifications,  limitations or restrictions
set forth below and the remaining authorized shares of the Preferred Stock shall
remain  undesignated  and  reserved  for future  issuance  subject to the future
action of the Board of Directors of the Corporation.


               Rights and Preferences of Series E Preferred Stock
               --------------------------------------------------

1. Dividends.

     (a) Amount and Payment of Dividend.  Subject to the limitations hereinafter
set forth,  the holders of Series E Preferred Stock shall be entitled to receive
dividends  at the rate of eight  percent  (8%) per annum of the  original  issue
price thereof of Ten and No/100 Dollars ($10.00) per share, and no more, payable
only at the time such shares are  converted  pursuant to Section 4 hereof.  Such
dividends may be paid in cash or in shares of Common Stock of the Corporation as
determined by the Board of Directors of the Corporation in its sole  discretion;
provided,  however,  no  fractional  shares  may be issued  for  dividends,  any
fractional  shares  will be rounded to the nearest  whole  share,  and  provided
further  that if any such  dividend  is paid in whole  or in part by  shares  of
Common  Stock,  the  number of shares of such  security  to be issued as a stock
dividend shall be determined by the Market Value (as defined in Section 7 below)
of a share  of  Common  Stock  on the last  day of the  period  for  such  stock
dividend.  Any shares of Series E Preferred  Stock  issued after the date hereof
shall accrue dividends from the date of issuance.

     (b) Cumulative  Rights.  To the extent,  if any, that dividends at the rate
set forth in Section  1(a) above  shall not be paid or set apart in full for the
Series E Preferred Stock,  the aggregate  deficiency shall be cumulated and must
be fully paid or set apart for payment  before any dividends may be paid upon or
set apart for the Common Stock of the  Corporation or before the Corporation may
purchase any of its Common Stock or otherwise make any  distribution  on account
of its  Common  Stock or any  other  class of  capital  stock  now or  hereafter
authorized or issued by the  Corporation  which ranks on a parity with or junior
to the Series E Preferred  Stock  (other  than (i) a dividend  payable in Common
Stock,  (ii) by conversion into or exchange for capital stock of the Corporation
ranking  junior to the  Series E  Preferred  Stock as to  dividends,  or (iii) a
dividend payable in compliance with Section 1(d) below).

<PAGE>


     (c) No Interest on Accrued Dividends. Any accumulations of dividends on the
Series E Preferred Stock shall not bear interest.

     (d)  Declaration.  Dividends  on the  Series  E  Preferred  Stock  shall be
declared if, when and as the Board of Directors of the Corporation  shall in its
sole discretion deem advisable,  and only from the surplus of the Corporation as
such  shall  be  fixed  and  determined  by the said  Board  of  Directors.  The
determination  of the Board of  Directors  at any time of the  amount of surplus
available  for the payment of dividends  shall be binding and  conclusive on the
holders of the shares of Series E Preferred Stock then outstanding. If dividends
are not paid in full upon the Series E Preferred  Stock and any other  Preferred
Stock ranking on a parity as to dividends with the Series E Preferred Stock, all
dividends  declared upon shares of Series E Preferred  Stock and upon such other
shares of  Preferred  Stock will be  declared  pro rata so that in all cases the
amount of dividends  declared per share on the Series E Preferred Stock and such
other  Preferred  Stock  shall  bear  the  same  ratio  to each  other  that the
accumulated  dividends  per share on the shares of the Series E Preferred  Stock
and such other shares of Preferred Stock bear to each other.  The holders of the
Series E Preferred Stock shall not be entitled to receive any dividends  thereon
other  than the  dividends  provided  for in the  preceding  provisions  of this
Section.

2. Voting  Rights and Notice of Meetings.  The holders of the Common Stock shall
have the exclusive right and power to vote on any matter  submitted to a vote of
the  shareholders  of the  Corporation and the holders of the Series E Preferred
Stock shall have no right or power whether authorized by the Act or otherwise to
vote on any matter or in any  proceeding or to be  represented  at or to receive
notice of any meeting of the shareholders.

3. Redemption by Corporation.

     The  Corporation  shall  have the  right to redeem  the  shares of Series E
Preferred  Stock at any time after six months from the date of issuance for $.01
per share, if the Market Value of the Common Stock exceeds $3.50 per share as of
the date of redemption.  Notice of redemption must be mailed at least 30 days in
advance to each holder of record of the Series E Preferred Stock to the holder's
address  as  shown  on the  stock  transfer  books  of the  Corporation.  On the
redemption  date,  the shares of Series E  Preferred  Stock  will  automatically
convert to into Common  Stock at the  conversion  rate as set forth in Section 4
below.  Upon  conversion  all rights of the  holders of such  Series E Preferred
Stock will terminate.

4. Conversion of Series E Preferred Stock

     (a) Conversion Right of Holder.  Each share of the Series E Preferred Stock
shall be convertible, at the option of the holder thereof, at any time after six
months from the date of issuance of such share of Series E Preferred  Stock into
fully paid and  nonassessable  whole  shares of Common  Stock upon the terms and
conditions set forth in the following paragraphs of this Section.
  
     (b)  Exercise  of  Conversion  Right.  Any holder of the Series E Preferred
Stock  electing to convert such stock into Common Stock pursuant to Section 4(a)
hereof shall deliver the  certificates  for the Series E Preferred  Stock to the
Corporation's  principal office or the office of the Corporation Transfer Agent,
with  the  form  of  written  notice  to  the   Corporation   endorsed  on  such
certificate(s)  of his  election to convert  such Series E Preferred  Stock into
Common Stock duly filled out and executed.  The  conversion  right in respect of
any such  Series E Preferred  Stock  pursuant  to Section  4(a) hereof  shall be
deemed to have been  exercised  at the date on which the  holder  delivers  such
notice of  conversion  duly filled out and  executed to the  Corporation  or the
Corporation's  transfer agent to the  Corporation  (the "Date of  Election").  A
facsimile  notice of conversion  will be accepted by the  Corporation as a valid

<PAGE>


notice  of  election,   so  long  as  the  holder  then  delivers  the  original
certificates  within three  business  days  thereafter.  The person  entitled to
receive the Common Stock issuable upon such conversion  shall be treated for all
purposes as the record holder of such security on such date; provided,  however,
that the  conversion  right in respect of any notice  receive after the close of
business  (11:59 PM EST) on any day  shall not be deemed to have been  exercised
until the next succeeding business day. As soon as practicable, and in any event
within three (3) business  days (five  business days if the Common Stock is then
being  quoted  on the OTC  Bulletin  Board)  after  the date of  receipt  of the
original  certificates of any Series E Preferred Stock to be converted  pursuant
to Section 4(a) hereof,  the  Corporation  shall deliver to the person  entitled
thereto,  certificate(s)  representing  the shares of Common Stock to which such
person shall be entitled on such conversion. The Corporation,  as a condition to
the  exercise  of such  rights of  conversion,  may require the payment of a sum
equal to any transfer tax or other  governmental  charge (but not  including any
tax payable upon the issue of stock  deliverable  upon such conversion) that may
be imposed or required by law, upon any transfer incidental or prior thereto, or
the submission of proper proof that the same has been paid.

     (c)  Conversion  Rate.  The number of shares of Common Stock  issuable upon
conversion  of each share of Series E Preferred  Stock shall be equal to $10.00,
divided by $2.50;  provided,  however, the Corporation shall not be required, in
connection  with any such  conversion,  to  issue a  fraction  of a share of its
Common nor to deliver any stock certificate representing a fraction thereof.

     (d)  Adjustment  of Conversion  Rate.  The number of shares of Common Stock
into which share of the Series E Preferred Stock is convertible shall be subject
to adjustment from time to time in certain instances, as follows:
 
          (1)  Recapitalization.  On any  recapitalization  of  the  Corporation
     through  the  split,  reverse  split,  subdivision  or  combination  of its
     outstanding  Common Stock into a greater or smaller  number of shares,  the
     number  of  shares  of  Common  Stock  into  which  the  shares of Series E
     Preferred  Stock may be converted shall be increased or reduced in the same
     proportion by an adjustment to the conversion rate.

          (2) On Capital Reorganization, Reclassification, Consolidation, Merger
     or   Sale   of   Corporate   Assets.   On   any   capital   reorganization,
     reclassification  of the capital stock,  consolidation,  merger, or sale or
     conveyance of all or substantially  all of the assets of the Corporation to
     another  corporation,  each  share of  Series E  Preferred  Stock  shall be
     convertible  into the same kind and amounts of securities,  including share
     or other assets, or both, that the holder of such share would have received
     had he converted  such share of Series E Preferred  Stock into Common Stock
     immediately prior to such reorganization, reclassification,  consolidation,
     merger, sale or conveyance.  Appropriate adjustments,  as determined by the
     Board of Directors of the Corporation,  shall be made in the application of
     the  provisions  herein set forth with respect to the rights and  interests
     thereafter  of the  holders  of the Series E  Preferred  Stock so that said
     provisions,  including the provisions with respect to changes in, and other
     adjustments of, the Conversion  Rate,  shall  thereafter be applicable,  as
     nearly as reasonably  may be, in relation to any securities or other assets
     thereafter  deliverable  on  conversion of the shares of Series E Preferred
     Stock.

     (e) Statement of Adjusted  Amount.  Whenever the amount of shares of Common
Stock  deliverable  on the  conversion  of  Series E  Preferred  Stock  shall be
adjusted  pursuant to the provisions  hereof,  the  Corporation  shall forthwith

<PAGE>


maintain at its office and file with the transfer  agent or agents,  a statement
signed by the President or Vice  President of the  Corporation  and by its Chief
Financial Officer, stating the adjusted amount of any securities deliverable for
each share of Series E Preferred Stock,  calculated to the nearest one hundredth
(1/100th)  share,  and  setting  forth  in  reasonable   detail  the  method  of
calculation and the facts requiring such adjustment and on which the calculation
is based.  Each adjustment shall remain in effect until a subsequent  adjustment
hereunder is required.

     (f)  Fractional  Shares.  Neither  fractional  shares  nor  scrip  or other
certificates  evidencing such shares shall be issued on conversion of the Series
E  Preferred  Stock as  herein  provided,  but the  Corporation  shall,  in lieu
thereof, round all such fractional shares to the nearest whole share.

     (g)  Payment  of Taxes on  Conversion  of  Series E  Preferred  Stock.  The
Corporation  shall pay any and all issue and other  taxes that may be payable in
respect of any issue or  delivery  of Common  Stock on  conversion  of shares of
Series E Preferred Stock pursuant hereto. The Corporation shall not, however, be
required to pay any tax which may be payable in respect of any transfer involved
in the issue and delivery of Common Stock in a name other than that in which the
shares of Series E Preferred  Stock so converted  were  registered,  and no such
issue or delivery  shall be made unless and until the person  requesting  it has
paid to the Corporation the amount of any such tax, or has  established,  to the
satisfaction of the Corporation, that such tax has been paid.

     (h) Reservation of Sufficient Common Stock. So long as any shares of Series
E Preferred  Stock shall  remain  outstanding  and the holders  thereof have the
right to convert said shares in accordance  with the  provisions of this Section
4, the  Corporation  will at all times reserve from the  authorized and unissued
shares of its Common  Stock a  sufficient  number of shares to provide  for such
conversions,  and will take such other  corporation  action as may be  necessary
from time to time in order that it may validly and legally issue  fully-paid and
non-assessable  shares of such  Common  Stock  upon  conversion  of the Series E
Preferred Stock.

     (i) Definition of Common Stock. In each case where reference is made to the
Common Stock of the Corporation in this Section, unless a different intention is
expressed,  such  reference  is to the  series or class of  Common  Stock of the
Corporation  as such series or class of stock exists at the date of the adoption
of these  provisions,  or stock into which the same may be changed  from time to
time.

     (j) Status of Converted  Preferred Shares. All shares of Series E Preferred
Stock so  converted  shall be canceled  and such shares shall be restored to the
status of authorized but unissued shares of Preferred Stock.

5. Liquidation Rights.

     (a)  Liquidation  Preference  Amount.  In the  event  of any  voluntary  or
involuntary liquidation, dissolution or winding up of the business or affairs of
the Corporation, and after payment of, or adequate provision for payment of, the
debts,  liabilities  and other claims of the  Corporation  as  determined by its
Board of  Directors,  each  holder  of the  Series E  Preferred  Stock  shall be
entitled to receive,  out of the remaining net assets of the Corporation legally
available  for  distribution  to  its   shareholders,   before  any  payment  or
distribution  shall be made on the Common Stock,  or on any other class of stock
of the Corporation ranking junior to the shares of Series E Preferred Stock upon
liquidation,  the amount of Ten Dollars ($10.00) per share of Series E Preferred
Stock,  plus all accrued and unpaid  dividends on each such share up to the date
fixed for distribution.

<PAGE>


     (b) Proportionate Distribution Where Assets Insufficient.  In the event the
assets of the Corporation available for distribution to the holders of shares of
Series E  Preferred  Stock upon  dissolution,  liquidation  or winding up of the
Corporation  whether  voluntary or involuntary,  shall be insufficient to pay in
full all amounts to which such holders are entitled pursuant to paragraph (a) of
this Section, no such distribution shall be made on account of any shares of any
class of capital stock of the Corporation ranking on a parity with the shares of
Series E Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate  distributive  amounts  shall be paid on  account of the shares of
Series E Preferred  Stock,  ratably,  in  proportion  to the full  distributable
amounts for which  holders of all such parity shares are  respectively  entitled
upon such dissolution, liquidation or winding up.

     (c) Nonparticipation  Right. After the payment to the holders of the shares
of Series E Preferred  Stock of the full  preferential  amounts  provided for in
either  paragraph  (a) or (b) of this  Section,  as  applicable,  the holders of
Series  E  Preferred  Stock as such  shall  have no right or claim to any of the
remaining assets of the Corporation.

     (d)  Excluded  Transactions.  Neither the  consolidation  nor merger of the
Corporation with or into any other corporation, nor the sale, mortgage, exchange
or conveyance of all or substantially all of the properties,  assets or business
of the  Corporation,  nor any  liquidation,  dissolution  or  winding  up of the
Corporation occurring substantially concurrently with any such transaction shall
be deemed to be a  liquidation,  dissolution  or winding  up of the  Corporation
within the meaning hereof, unless otherwise determined by the Board of Directors
of the Corporation.

6. No  Preemptive  Rights.  No holder of shares of the Series E Preferred  Stock
shall, as such holder, have any preemptive right to subscribe to or purchase any
shares  of any  class of  capital  stock  of the  Corporation  now or  hereafter
authorized or issued,  whether or not  exchangeable for any capital stock of the
Corporation of any class or classes now or hereafter  authorized or issued;  nor
shall any holder of shares of the Series E Preferred Stock, as such holder, have
any  right to  purchase,  acquire  or  subscribe  for any  securities  which the
Corporation  may issue or sell whether or not  convertible  into or exchangeable
for shares of capital  stock of the  Corporation  of any class or  classes,  and
whether  or not  any  such  securities  have  attached  or  appurtenant  thereto
warrants,  options or other  instruments  which  entitle the holders  thereof to
purchase,  acquire or  subscribe  for  shares of  capital  stock of any class or
classes of the Corporation.

7.  Determination  of  Market  Value  of  Capital  Stock  of  Corporation.   The
determination  of the per share  "Market  Value" of Common Stock as set forth in
previous  Sections  shall be  determined  using the  previous  five day  average
closing bid price for the day or, where no sale is made on that day, the average
of the closing bid and asked  prices for that day on the NASDAQ  Stock Market or
the OTC  Bulletin  Board if the  securities  are at the time  listed  or  quoted
thereon,  respectively,  or,  if it is not so  listed  or  quoted,  on any other
national  securities  exchange selected by the Corporation on which it is at the
time  listed.  If at the  applicable  time the Common Stock is quoted on the OTC
Bulletin Board, the foregoing  calculations  shall be based on a Trade and Quote
Summary Report from the OTC Bulletin Board Research Service if available, and if
not, on any other publicly  available  data  reasonably  deemed  reliable by the
Corporation.

8. Covenants of the  Corporation.  The Corporation will not, by amendment to its
Articles of Incorporation,  as amended, or through any reorganization,  transfer
of assets, consolidation,  merger, dissolution,  issue or sale of securities, or
any other voluntary action, avoid or seek to avoid the observance or performance
of any of the terms of the  preferences  and  limitations  of Series E Preferred
Stock to be observed or performed hereunder by the Corporation,  but will at all
times in good faith assist in the carrying out of all the  provisions  set forth
herein relating to Series E Preferred Stock and in the taking of all such action
as may be necessary or appropriate in order to protect the rights of the holders
of the Series E Preferred Stock against dilution or other impairment.

<PAGE>


     IN  WITNESS  WHEREOF,  HARVEST  RESTAURANT  GROUP,  INC.  has  caused  this
Statement of Resolution Establishing Series of Shares to be signed by William J.
Gallagher,  its Chairman of the Board and Chief Executive Officer,  and attested
by Joseph Fazzone, its Secretary, this _______th day of December, 1998.


                                          HARVEST RESTAURANT GROUP, INC.



                                          By:/s/ William J. Gallagher
                                          ---------------------------
                                               WILLIAM J. GALLAGHER,
                                               Chairman of the Board and
                                               Chief Executive Officer



                                          By:/s/ Joseph Fazzone
                                          ---------------------
                                               JOSEPH FAZZONE,
                                               Chief Financial Officer and 
                                               Secretary

<PAGE>

                              ARTICLES OF AMENDMENT
                                     TO THE
                           ARTICLES OF INCORPORATION


     Pursuant  to  the   provisions  of  Article  4.04  of  the  Texas  Business
Corporation Act, the undersigned  corporation  adopts the following  Articles of
Amendment to its Articles of Incorporation:

                                  ARTICLE ONE:
                                      NAME
                                      ----

     The name of the corporation is CLUCKCORP INTERNATIONAL, INC.

                                  ARTICLE TWO:
                                   AMENDMENTS
                                   ----------

     The following  amendments to the Articles of incorporation  were adopted by
the  Shareholders  of the  Corporation on September 30, 1997, in order to change
the name of the  Corporation  and  increase the number of  authorized  shares of
common stock of the Corporation.

Article  One of the Amended  Articles of  Incorporation  of the  Corporation  is
hereby amended to read in its entirety as follows:

                                  ARTICLE ONE:
                                      NAME
                                      ----

     The  name  of the  corporation  is  HARVEST  RESTAURANT  GROUP,  INC.  (the
"Corporation").

     2.2 Article Four,  Section 1, of the Amended  Articles of  incorporation of
the Corporation is hereby amended to read in its entirety as follows.

                                  ARTICLE FOUR:
                  CAPITALIZATION, PREEMPTIVE RIGHTS AND VOTING
                  --------------------------------------------

     Section 1. Authorized Shares. The Corporation shall have authority to issue
two  classes  of  shares  to be  designated  respectively,  "Common  Stock"  and
"Preferred  Stock."  The  total  number  of  shares  which  the  Corporation  is
authorized to issue is Twenty-Five  Million  (25,000,000) shares of which Twenty
Million (20,000,000) shall be Common Stock and five million (5,000,000) shall be
Preferred  Stock.  Each share of Common  Stock  shall have par value of ONE CENT
($.01),  and each share of Preferred  Stock shall have a par value of ONE DOLLAR
($1.00).
       
     The Preferred Stock  authorized by these Articles of  Incorporation  may be
issued  from time to time in one or more  series,  each of which shall have such
designation(s)  or title(s) as may be fixed by the Board of  Directors  prior to
the issuance of any shares thereof.  The Board of Directors is hereby authorized
to  fix  or  alter  the  redemption,  including  sinking  fund  provisions,  the
redemption  price or prices,  voting rights and  liquidation  preferences of any
wholly unissued series of Preferred Stock, and the number of shares constituting
any such series and the designation thereof, or any of them. The rights, powers,
preferences,  limitations and restrictions,  if any, accompanying such shares of
Preferred  Stock  shall be set forth by  resolution  of the  Board of  Directors
providing for the issue thereof prior to the issuance of any shares thereof,  in
accordance  with the applicable  provisions of the Act. Each share of any series
of  Preferred  Stock shall be  identical  with all other  shares of such series,
except as to the date from which dividends, if any, shall accrue.

<PAGE>

                                 ARTICLE THREE:
                               OUTSTANDING SHARES
                               ------------------

     The number of shares of common stock of the Corporation  outstanding at the
time  of  the  adoption  of  the   foregoing   amendments  to  the  Articles  of
Incorporation  of the  Corporation  was  2,369,030;  and the number of shares of
common  stock  entitled to vote thereon was  2,369,030.  The number of shares of
preferred  stock of the  Corporation  outstanding at the time of the adoption of
the foregoing amendments to the Articles of Incorporation of the Corporation was
515,000:  and the number of shares of preferred  stock  entitled to vote thereon
was 0.

                                  ARTICLE FOUR:
                               ADOPTING AMENDMENTS
                               -------------------

     4.1 The total number of shares of common  stock voted for the  amendment of
Article One of the Articles of  Incorporation  as set forth above was 1,430,483;
and the  number of shares of common  stock  voted  against  such  amendment  was
11,300. The owners of 927,247 shares of common stock did not vote. The owners of
the preferred  stock were not entitled to vote on said  amendment of Article One
of the Articles of Incorporation.

     4.2 The number of shares of common stock voted for the amendment of Article
Four of the Articles of Incorporation as set forth above was 1,305,458;  and the
number of shares of common stock voted against such  amendment was 113,825.  The
owners  of  949,747  shares of common  stock  did not  vote.  The  owners of the
preferred  stock were not entitled to vote on said  amendment of Article Four of
the Articles of Incorporation.

     Executed this 30th day of September, 1997.

                                            CLUCKCORP INTERNATIONAL, INC.


                                            By:/s/ William J. Gallagher
                                            ---------------------------
                                               William J. Gallagher
                                               Chief Executive Officer


<PAGE>


                         HARVEST RESTAURANT GROUP, INC.
                       ARTICLES/CERTIFICATE OF CORRECTION

     This  correction  is  submitted  pursuant  to  Article   1302-7.01,   Texas
Miscellaneous  Corporation  Laws Act for a  corporation,  to  correct a document
which is an inaccurate  record of the entity  action,  contains an inaccurate or
erroneous  statement,  or  was  defectively  or  erroneously  executed,  sealed,
acknowledged or verified.

                                   ARTICLE ONE

     The name of the entity is HARVEST  RESTAURANT  GROUP,  INC.,  fka CLUCKCORP
INTERNATIONAL, INC.

                                   ARTICLE TWO

     The  document to be  corrected is the Articles of Amendment to the Articles
of Incorporation which were filed in the Office of the Secretary of State on the
1st day of October, 1997.

                                  ARTICLE THREE

     The inaccuracy, error, or defect to be corrected is:

     "4.1 The total number of shares of common stock voted for the  amendment of
Article One of the Articles of  Incorporation  as set forth above was 1,430,483;
and the  number of shares of common  stock  voted  against  such  amendment  was
11,300. The owners of 927,247 shares of common stock did not vote. The owners of
the preferred  stock were not entitled to vote on said  amendment of Article One
of the Articles of Incorporation.

     4.2 The number of shares of common stock voted for the amendment of Article
Four of the Articles of Incorporation as set forth above was 1,305,458;  and the
number of shares of common stock voted against such  amendment was 113,825.  The
owners  of  949,747  shares of common  stock  did not  vote.  The  owners of the
preferred  stock were not entitled to vote on said  amendment of Article Four of
the Articles of Incorporation."

                                  ARTICLE FOUR

     As  corrected,  the  inaccurate,  erroneous,  or  defective  portion of the
document reads as follows:

     "4.1 The total number of shares of common stock voted for the  amendment of
Article One of the Articles of  Incorporation  as set forth above was 1,745,930;
the number of shares of common stock voted  against such  amendment  was 11,300;
and 3,800 shares of common stock voted to abstain.  The owners of 608,000 shares
of common  stock did not  vote.  The  owners  of the  preferred  stock  were not
entitled  to  vote  on  said  amendment  of  Article  One  of  the  Articles  of
Incorporation.


     4.2 The number of shares of common stock voted for the amendment of Article
Four of the  Articles of  Incorporation  as set forth above was  1,620,405;  the
number of shares of common stock voted against such  amendment was 113,825;  and
26,800 shares of common stock voted to abstain.  The owners of 608,000 shares of
common stock did not vote.  The owners of the preferred  stock were not entitled
to vote on said amendment of Article Four of the Articles of Incorporation."


                                              By:/s/ William J. Gallagher
                                              ---------------------------
                                                 William J. Gallagher
                                                 Chief Executive Officer

<PAGE>

                              ARTICLES OF AMENDMENT
                                     TO THE
                            ARTICLES OF INCORPORATION

     Pursuant  to  the   provisions  of  Article  4.04  of  the  Texas  Business
Corporation Act, the undersigned  corporation  adopts the following  Articles of
Amendment to its Articles of Incorporation:

                                  ARTICLE ONE:

                                      NAME
                                      ----

     The name of the corporation is HARVEST RESTAURANT GROUP, INC.

                                  ARTICLE TWO:

                                   AMENDMENTS
                                   ----------

     The following  amendments to the Articles of Incorporation  were adopted by
the  Shareholders  of the  Corporation on March 12, 1999, in order to change the
name of the Corporation  and increase the number of authorized  shares of common
stock of the Corporation.

     2.1  Article One of the Articles of  Incorporation  of the  Corporation  is
          hereby amended to read in its entirety as follows:

                                  ARTICLE ONE:
                                      NAME
                                      ----

     The  name of the  corporation  is  TANNER'S  RESTAURANT  GROUP,  INC.  (the
"Corporation").

     2.2  Article  Four,  Section 1, of the  Articles  of  Incorporation  of the
          Corporation is hereby amended to read in its entirety as follows:


                                  ARTICLE FOUR:
                  CAPITALIZATION, PREEMPTIVE RIGHTS AND VOTING
                  --------------------------------------------

     Section 1. Authorized Shares. The Corporation shall have authority to issue
     two classes of shares to be  designated  respectively,  "Common  Stock" and
     "Preferred  Stock".  The total  number of shares  that the  Corporation  is
     authorized to issue is Two Hundred Five Million  (205,000,000)  shares,  of
     which Two  Hundred  Million  (200,000,000)  shall be Common  Stock and Five
     Million  (5,000,000)  shall be Preferred Stock.  Each share of Common Stock
     shall  have a par value of ONE CENT  ($.01),  and each  share of  Preferred
     Stock shall have a par value of ONE DOLLAR ($1.00).

     The Preferred Stock  authorized by these Articles of  Incorporation  may be
issued  from  time to  time in one or more  series,  each of  which  shall  have
designation(s)  or title(s) as may be fixed by the Board of  Directors  prior to
the issuance of any shares thereof.  The Board of Directors is hereby authorized
to  fix  or  alter  the  redemption,  including  sinking  fund  provisions,  the

<PAGE>


redemption  price or prices,  voting rights and  liquidation  preferences of any
wholly unissued series of Preferred Stock, and the number of shares constituting
any such series and the designation thereof, or any of them. The rights, powers,
preferences,  limitations and restrictions,  if any, accompanying such shares of
Preferred  Stock  shall be set forth by  resolution  of the  Board of  Directors
providing for the issue thereof prior to the issuance of any shares thereof,  in
accordance  with the applicable  provisions of the Act. Each share of any series
of  Preferred  Stock shall be  identical  with all other  shares of such series,
except as to the date from which dividends, if any, shall accrue.

                                 ARTICLE THREE:
                               OUTSTANDING SHARES
                               ------------------

The number of shares of common stock of the Corporation  outstanding on the date
of record for determining the shareholders entitled to vote upon the adoption of
the foregoing amendments to the Articles of Incorporation of the Corporation was
8,241,609; and the number of shares of common stock entitled to vote thereon was
8,241,609.   The  number  of  shares  of  preferred  stock  of  the  Corporation
outstanding on the date of record for  determining  the  shareholders  of record
entitled to vote upon the adoption of the  foregoing  amendments to the Articles
of Incorporation  of the Corporation was 1,247,552;  and the number of shares of
preferred stock entitled to vote thereon was 0.

                                  ARTICLE FOUR:
                               ADOPTING AMENDMENTS
                               -------------------

     4.1  The total number of shares of common stock voted for the  amendment of
          Article One of the  Articles of  Incorporation  as set forth above was
          7,352,794, and the number of shares of common stock voted against such
          amendment was 31,480. The owners of 857,335 shares of common stock did
          not vote. The owners of the preferred  stock were not entitled to vote
          on said amendment of Article One of the Articles of Incorporation.

     4.2  The  number  of  shares of common  stock  voted for the  amendment  of
          Article Four of the Articles of  Incorporation  as set forth above was
          7,228,549  and the number of shares of common stock voted against such
          amendment  was 151,674.  The owners of 861,386  shares of common stock
          did not vote.  The owners of the preferred  stock were not entitled to
          vote  on  said   amendment   of  Article   Four  of  the  Articles  of
          Incorporation.

          Executed this 12th day of March, 1999


                                        HARVEST RESTAURANT GROUP, INC.



                                        By: /s/ Clyde E. Culp, III
                                        --------------------------
                                            Clyde E. Culp, III
                                            Chairman and Chief Executive Officer