SECOND AMENDMENT TO AMENDED AND RESTATED LOAN FACILITY AGREEMENT AND GUARANTY

SECOND AMENDMENT

TO AMENDED AND RESTATED

LOAN FACILITY AGREEMENT AND GUARANTY

THIS SECOND AMENDMENT TO AMENDED AND RESTATED LOAN FACILITY AGREEMENT AND GUARANTY dated as of February 28, 2007 (the " Amendment ") is entered into among Ruby Tuesday, Inc., a Georgia corporation (the " Sponsor "), the Participants party hereto and Bank of America, N.A., as servicer and agent for the Participants (in such capacity, the " Servicer "). All capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Loan Facility Agreement (as defined below).

RECITALS

WHEREAS, the Sponsor, the Participants and the Servicer entered into that certain Amended and Restated Loan Facility Agreement and Guaranty dated as of November 19, 2004 (as amended or modified from time to time, the " Loan Facility Agreement ");

WHEREAS, the Sponsor has requested that the Participants amend the Loan Facility Agreement as set forth below subject to the terms and conditions specified in this Agreement;

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

(a)         The following definitions are hereby added to Section 1.1 of the Loan Facility Agreement in the appropriate alphabetical order and shall read as follows:

• • " Acquisition " shall mean any transaction, or any series of related transactions, consummated on or after the date of this Agreement, by which the Sponsor or any of its Subsidiaries (i) acquires any going business or all or substantially all of the assets of any Person, or division thereof, whether through purchase of assets, merger or otherwise or (ii) directly or indirectly acquires (in one transaction or as the most recent transaction in a series of transactions) at least a majority (in number of votes) of the securities of a corporation which have ordinary voting power for the election of directors (other than securities having such power only by reason of the happening of a contingency) or a majority (by percentage of voting power) of the outstanding ownership interests of a partnership or limited liability company.

     

    " Disposition " shall mean the sale, transfer, license, lease or other disposition of any property by the Borrower or any Subsidiary, but excluding any sale, lease, license, transfer or other disposition permitted by Section 6.19(a), (b), (c), (d) or (e).

     

    • • " Permitted Acquisition " shall have the meaning set forth in Section 6.17.

     

    " Pro Forma Basis " shall mean, for purposes of calculating the financial covenants set forth in Section 6.11, 6.12 and 6.13 (including for purposes of determining the Applicable Margin), that any Disposition, Acquisition or Restricted Payment shall be deemed to have occurred as of the first day of the most recent four fiscal quarter period preceding the date of such transaction for which the Sponsor was required to deliver financial statements pursuant to

     

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    Section 6.1(a) or (b) . In connection with the foregoing, (a) with respect to any Disposition, income statement and cash flow statement items (whether positive or negative) attributable to the property disposed of shall be excluded to the extent relating to any period occurring prior to the date of such transaction and (b) with respect to any Acquisition, income statement items attributable to the Person or property acquired shall be included to the extent relating to any period applicable in such calculations to the extent (A) such items are not otherwise included in such income statement items for the Borrower and its Subsidiaries in accordance with GAAP or in accordance with any defined terms set forth in Section 1.1 and (B) such items are supported by financial statements or other information reasonably satisfactory to the Administrative Agent and (ii) any Indebtedness incurred or assumed by the Borrower or any Subsidiary (including the Person or property acquired) in connection with such transaction (A) shall be deemed to have been incurred as of the first day of the applicable period and (B) if such Indebtedness has a floating or formula rate, shall have an implied rate of interest for the applicable period for purposes of this definition determined by utilizing the rate which is or would be in effect with respect to such Indebtedness as at the relevant date of determination.

     

    " SEC " shall mean the Securities and Exchange Commission, or any Governmental Authority succeeding to its principal functions.

• • " Second Amendment Effective Date " means February 28, 2007.

     

    " Securities Laws " shall mean the Securities Act of 1933, the Securities Exchange Act of 1934, Sarbanes-Oxley and the applicable accounting and auditing principles, rules, standards and practices promulgated, approved or incorporated by the SEC or the Public Company Accounting Oversight Board, as each of the foregoing may be amended and in effect on any applicable date hereunder.

• • " Senior Note Purchase Agreement " shall mean that certain Note Purchase Agreement dated as of April 1, 2003 among the Sponsor and the purchasers party thereto, as amended or modified from time to time.

     

    " Solvent " or " Solvency " shall mean, with respect to any Person as of a particular date, that on such date (a) such Person is able to pay its debts and other liabilities, contingent obligations and other commitments as they mature in the ordinary course of business, (b) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature in their ordinary course, (c) such Person is not engaged in a business or a transaction, and is not about to engage in a business or a transaction, for which such Person’s property would constitute unreasonably small capital after giving due consideration to the prevailing practice in the industry in which such Person is engaged or is to engage, (d) the fair value of the property of such Person is greater than the total amount of liabilities, including, without limitation, contingent liabilities, of such Person and (e) the present fair salable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured. In computing the amount of contingent liabilities at any time, it is intended that such liabilities will be computed at the amount which, in light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

(b)          The definitions " Adjusted Total Capital " and " Adjusted Total Debt to Adjusted Capital Ratio " are hereby deleted from Section 1.1 of the Loan Facility Agreement in their entireties.

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(c)           The definition of "Applicable Margin" in Section 1.1 of the Loan Facility Agreement is hereby amended to read as follows:

• •  

    " Applicable Margin " shall mean, as of any date, the following percentages per annum determined by reference to the applicable Adjusted Total Debt to EBITDAR Ratio for the Sponsor and its Subsidiaries in effect on such date as set forth below:

     

• • provided , that a change in the Applicable Margin resulting from a change in such ratio shall be effective on the second Business Day after which the Sponsor is required to deliver the financial statements required by Section 6.1(a) or (b) and the compliance certificate required by Section 6.1(c) ; provided, further, that if at any time the Sponsor shall have failed to deliver such financial statements and such certificate, the Applicable Margin shall be at Level II until such time as such financial statements and certificate are delivered, at which time the Applicable Margin shall be determined as provided above. Notwithstanding the foregoing, the Applicable Margin from the Second Amendment Effective Date until the first financial statement and compliance certificate are required to be delivered subsequent to the Second Amendment Effective Date shall be at Level II.

     

(d)          The following paragraph is hereby added at the end of Section 1.2 of Loan Facility Agreement to read as follows:

• • Notwithstanding the above, the parties hereto acknowledge and agree that all calculations of the financial covenants in Section 6.11 and 6.12 (including for purposes of determining the Applicable Margin) shall be made on a Pro Forma Basis.

     

• • • •  

        The Sponsor and its Subsidiaries are Solvent on a consolidated basis.

(f)           Sections 6.1(a) and (b) of the Loan Facility Agreement are hereby amended to read as follows:

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    (a)           as soon as available and in any event upon the earlier of the date that is 90 days after the end of each fiscal year of Sponsor and the date that is 2 days after such information is filed with the SEC, a copy of the annual audited report for such fiscal year for the Sponsor and

     

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• • its Subsidiaries, containing consolidated balance sheets of the Sponsor and its Subsidiaries as of the end of such fiscal year and the related consolidated statements of income, stockholders’ equity and cash flows (together with all footnotes thereto) of the Sponsor and its Subsidiaries for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail and reported on by KPMG L.L.P or other independent public accountants of nationally recogni