PICCADILLY CAFETERIAS INC
2ND AMENDMENT TO AMENDED AND RESTATED CREDIT FACILITY
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>picq93003ex10.htm
<DESCRIPTION>2ND AMENDMENT TO AMENDED AND RESTATED CREDIT FACILITY
<TEXT>
<html>



<body>

<b><font SIZE="2">
<p align="right">EXHIBIT 10.1</p>
</font></b><font FACE="Courier" SIZE="2">
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">&nbsp;</p>
</font><b><font SIZE="2">
<p ALIGN="CENTER">SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT</p>
</font></b><font SIZE="2"><b>
<p ALIGN="JUSTIFY">THIS SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT
AGREEMENT</b> (this &quot;<b>Second Amendment</b>&quot;) is made by and among <b>Piccadilly
Cafeterias, Inc.</b> (the &quot;<b>Borrower</b>&quot;), <b>Hibernia National
Bank</b> and <b>Branch Banking and Trust Company</b> (collectively, the &quot;<b>Banks</b>&quot;
and individually, a &quot;<b>Bank</b>&quot;), effective as of July 31, 2001 (the
&quot;<b>Effective Date</b>&quot;). This Agreement amends the Amended and
Restated Credit Agreement dated as of December 21, 2000, as previously amended
by First Amendment to Amended and Restated Credit Agreement dated as of June 15,
2001, made by and among the Borrower, the Banks and others (collectively, the
&quot;<b>Restated Credit Agreement</b>&quot;).</p>
<p ALIGN="JUSTIFY">The Borrower has requested that the Restated Credit Agreement
be further amended and the Banks have agreed to further amend the Restated
Credit Agreement on the following terms and conditions.</p>
<i>
<p ALIGN="JUSTIFY">Amendment to Section 3.02.</i> Section 3.02 of the Restated
Credit Agreement is amended in its entirety to read as follows:</p>
</font><font FACE="Courier" SIZE="2">
<p ALIGN="JUSTIFY"></font><font SIZE="2">Section 3.02 <i>Advance Requests</i>.
For each Advance requested by the Borrower, the Borrower shall provide the
Administrative Agent with a written request in a form acceptable to the
Administrative Agent prior to 11:00 a.m. (New Orleans, Louisiana time),
accompanied by an Officer's Certificate that includes the aggregate amount of
cash and Cash Equivalents of the Borrower and all Restricted Subsidiaries as of
date of the Advance request. In the event an Advance is not funded on the date
of the Advance request, the Administrative Agent may request an updated
Officer's Certificate that includes the aggregate amount of cash and Cash
Equivalents of the Borrower and all Restricted Subsidiaries as of a date
specified by the Administrative Agent. Requested Advances shall be available
only in amounts of at least <b>$500,000.00</b>, each, and in increments of <b>$50,000.00</b>
above that amount. The Banks shall not be required to make any requested Advance
if the amount of the requested Advance, <i>plus</i> the aggregate amount of cash
and Cash Equivalents of the Borrower and all Restricted Subsidiaries at the time
of the Advance request or the date the Advance is to be made, exceeds <b>$1,000,000.00</b>.
Each requested Advance shall be conclusively deemed to have been made at the
request of and for the benefit of the Borrower (a) when credited to any deposit
account of the Borrower maintained with the Administrative Agent or any Bank, or
(b)when advanced in accordance with the instructions in the written request for
the Advance. All or part of a requested Advance may be initially made as a
Euro-Dollar Loan, provided that the Borrower furnishes the Administrative Agent
with the requisite advance written notice of a Euro-Dollar Loan election for the
requested Advance.</p>
<i>
<p ALIGN="JUSTIFY">Amendment to Section 8.03.</i> Section 8.03 of the Restated
Credit Agreement is amended in its entirety to read as follows:</p>
</font><font FACE="Courier" SIZE="2">
<p ALIGN="JUSTIFY"></font><font SIZE="2">Section 8.03 <i>Minimum Consolidated
Tangible Net Worth</i>. As of the fiscal quarter ending <b>September 30, 2001</b>,
the Borrower shall have a Consolidated Tangible Net Worth of at least <b>$25,000,000.00</b>.
Beginning with the fiscal quarter ending <b>December 31, 2001</b>, and as of
each fiscal quarter end thereafter, the Borrower shall maintain a Consolidated
Tangible Net Worth of at least, (a) <b>$24,254,000.00</b> (which amount is the
Consolidated Tangible Net Worth of the Borrower as of June 30, 2001, <i>minus</i>
$3,000,000.00), <i>plus</i> (b) <b>50%</b> of the cumulative Consolidated Net
Income of the Borrower and its Restricted Subsidiaries after June 30, 2001 (if
positive), <i>plus</i> (c) <b>100%</b> of the Net Proceeds of any Qualified
Equity Offering after December 21, 2000.</p>
</font><font FACE="Courier" SIZE="2">
<p ALIGN="JUSTIFY"></font><i><font SIZE="2">Excess Cash Flow Representations and
Warranties.</font></i><font SIZE="2"> The Borrower hereby represents and
warrants to the Banks that (a) the Excess Cash Flow of the Borrower for the
fiscal year ending June 30, 2001, did not exceed $2,500,000.00, (b) the Borrower
will not be obligated to make any Excess Cash Flow Offer under the Indenture or
the Term Loan Credit Agreement for the fiscal year ending June 30, 2001, and (c)
the Borrower will not make any Excess Cash Flow Offer or Additional Excess Cash
Flow Offer under the Indenture or the Term Loan Credit Agreement for the fiscal
year ending June 30, 2001.</p>
<i>
<p ALIGN="JUSTIFY">Reduced Commitments</i>. The Borrower and the Banks
acknowledge and agree that, as the result of Asset Sales allowed under the
Restated Credit Agreement, as of the Effective Date, the aggregate of all
Commitments under the Restated Credit Agreement has been reduced to <b>$14,394,000.00</b>,
allocated between the Banks as follows:</p>
<p ALIGN="JUSTIFY">Hibernia National Bank $ 11,515,200.00<br>
Branch Banking and Trust Company $ 2,878,800.00</p>
<i>
<p ALIGN="JUSTIFY">Acceptable Accountants' Report.</i> The Banks hereby agree
that a &quot;going concern&quot; explanatory paragraph included in the
Accountants' Report of the audited financial statements of the Borrower for the
fiscal year ending June 30, 2001, shall be acceptable to the Banks, provided
that the explanatory paragraph expressly states that it is based principally on
the potential inability of the Borrower, in the future, to comply with the
financial covenants included in Article VIII of the Restated Credit Agreement.
The Banks further agree that the inclusion of such an explanatory paragraph in
the Accountants' Report of the audited financial statements of the Borrower for
the fiscal year ending June 30, 2001, shall not cause a Default or an Event of
Default to occur under the Restated Credit Agreement.</p>
<i>
<p ALIGN="JUSTIFY">Amendment Fee.</i> The Borrower agrees to pay an amendment
fee of <b>$21,591.00</b> due and payable to the Administrative Agent, in full,
upon execution of this Agreement. After the amendment fee is collected, the
Administrative Agent shall remit <b>$14,394.00</b> to Hibernia National Bank as
its share of the amendment fee, and <b>$7,197.00</b> to Branch Banking and Trust
Company as its share of the amendment fee.</p>
<i>
<p ALIGN="JUSTIFY">No Novation</i>. This Second Amendment shall not in any
manner constitute or be construed to constitute a novation, discharge,
forgiveness, extinguishment or release of any obligation for amounts due under
the Restated Credit Agreement, which obligations, as amended hereby, shall
continue in full force and effect, and retain the same ranking, priority and
order as prior hereto, in accordance with the terms of the Restated Credit
Agreement. The Borrower hereby confirms and ratifies all of the security as
described in the Restated Credit Agreement, and all notes, mortgages, pledges,
security agreements, and other agreements executed in connection therewith, all
of the foregoing to secure all amounts described in the Restated Credit
Agreement.</p>
</font><font FACE="Courier" SIZE="2">
<p ALIGN="JUSTIFY"></font><i><font SIZE="2">Representations and Warranties</font></i><font SIZE="2">.
The Borrower hereby confirms, reaffirms, and restates the representations,
warranties, affirmative covenants and negative covenants set forth in the
Restated Credit Agreement. The Borrower also represents and warrants that there
has been no undisclosed material adverse change in (a) the business operations
of the Borrower, (b) the management of the Borrower, and/or (c) any other facts,
circumstances or conditions upon which the Banks have relied or utilized in
making their decision to enter into this Second Amendment.</p>
<i>
<p ALIGN="JUSTIFY">Release.</i> In consideration of the Banks' consent to enter
into this Second Amendment, the Borrower agrees that all disputes and claims
whatsoever of any kind or nature which the Borrower presently has or may have
against the Administrative Agent, the Collateral Agent or any Bank are fully and
finally released, compromised and settled. The Borrower, for itself and its
successors in interests and assigns, does hereby expressly release and forever
relieve, discharge and grant full acquittance to the Administrative Agent, the
Collateral Agent and the Banks for and from any and all causes of action, suits,
claims, debts, obligations or liabilities of any nature whatsoever, known or
unknown, alleged or not alleged, which the Borrower has or may have against the
Administrative Agent, the Collateral Agent, any Bank, or the agents, attorneys,
officers, employees, directors and shareholders of the Administrative Agent, the
Collateral Agent or any Bank, as of the date of the Effective Date. This release
shall be construed to have the broadest possible scope.</p>
<i>
<p ALIGN="JUSTIFY">Definitions</i>. Terms defined in the Restated Credit
Agreement shall have their defined meanings when used herein, except as
otherwise provided for herein.</p>
<i>
<p ALIGN="JUSTIFY">Limited Effect</i>. Except as amended and modified herein,
the Restated Credit Agreement shall continue to be and shall remain in full
force and effect in accordance with its terms.</p>
<i>
<p ALIGN="JUSTIFY">Governing Law</i>. This Second Amendment shall be governed by
and construed and interpreted in accordance with the laws of the State of
Louisiana.</p>
<p ALIGN="JUSTIFY">[NEXT PAGES ARE SIGNATURE PAGES]</p>
<p ALIGN="JUSTIFY">&nbsp;</p>
<b>
<p ALIGN="JUSTIFY">THE BORROWER AND THE BANKS EACH ACKNOWLEDGE HAVING READ ALL
THE PROVISIONS OF THIS SECOND AMENDMENT, AND EACH AGREES TO ITS TERMS. THIS
SECOND AMENDMENT IS DATED AS OF JULY 31, 2001.</p>
<p ALIGN="JUSTIFY">PICCADILLY CAFETERIAS, INC.</b>,<br>
as the Borrower</p>
<p ALIGN="JUSTIFY">&nbsp;</p>
<p ALIGN="JUSTIFY">By:&nbsp;<u>&nbsp;&nbsp; /S/ MARK L. MESTAYER&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u><br>
Name:&nbsp;&nbsp;&nbsp; Mark L. Mestayer&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
Title: Executive Vice President, Treasurer<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; and Chief Financial
Officer</p>
<p ALIGN="JUSTIFY">3232 South Sherwood Forrest Boulevard<br>
Baton Rouge, Louisiana 70821-2467<br>
Attention:&nbsp;&nbsp;&nbsp;&nbsp; Mark L. Mestayer<br>
&nbsp;&nbsp; </font>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<font SIZE="2">Chief Financial Officer<br>
Telecopy Number: 504-296-8370<br>
Telephone Number: 504-293-9440</p>
<b>
<p ALIGN="JUSTIFY">&nbsp;</p>
<p ALIGN="JUSTIFY">HIBERNIA NATIONAL BANK</b>,<br>
as a Bank</p>
<p ALIGN="JUSTIFY">&nbsp;</p>
<p ALIGN="JUSTIFY">By:&nbsp;<u>&nbsp; /S/ JANET O.
RACK&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u><br>
Name: Janet O. Rack<br>
Title: Senior Vice President</p>
<p ALIGN="JUSTIFY">440 Third Street -- 6<sup>th</sup> Floor<br>
Baton Rouge, Louisiana 70801<br>
Attention:&nbsp;&nbsp;&nbsp;&nbsp; Janet Rack<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;
Senior Vice President<br>
Telecopy Number: 225-381-2003<br>
Telephone Number: 225-381-2140</p>
<p ALIGN="JUSTIFY">&nbsp;</p>
<b>
<p ALIGN="JUSTIFY">BRANCH BANKING AND TRUST COMPANY</b>,<br>
as a Bank</p>
<p ALIGN="JUSTIFY">&nbsp;</p>
<p ALIGN="JUSTIFY">By:&nbsp;<u>&nbsp;&nbsp; /S/ THATCHER L. TOWNSEND
III&nbsp;&nbsp;</u><br>
Name: Thatcher L. Townsend III<br>
Title: Senior Vice President</p>
<u>
<p ALIGN="JUSTIFY">Lending Office</u>:</p>
<p ALIGN="JUSTIFY">110 South Stratford Road<br>
Post Office Box 15008<br>
Winston-Salem, North Carolina 27113-5008<br>
Attention: Corporate Accounts Division<br>
Telecopy Number: 336-733-3254<br>
Telephone Number: 336-733-3245</p>
<p ALIGN="JUSTIFY">&nbsp;</p>
</font>

</body>

</html>

</TEXT>
</DOCUMENT>
