In the United States Bankruptcy Court for the Northern District of Texas Dallas Division

Nation's Restaurant News, August 11, 2003 by Samuel M. Stricklin, John C. Leininger, Michael D. Anderson

In re:

CAFETERIA OPERATORS, L.E. et al.

Debtors..

Jointly Administered under Case No. 03-30179-HDH-11 Chapter 11

NOTICE OF SALE PROCEDURES, AUCTION DATE, AND SALE HEARING

PLEASE BE ADVISED that on July 2, 2003, Furr's Restaurant Group. Inc. ("FRG"), Cafeteria Operators, L.P. ("COLP"), Furr's/Bishop's Cafeterias, L.P. ("FBC"), and Cavalcade Foods, Inc. ("CFI"), as debtors in possession in the above-referenced chapter 11 cases, (collectively, the "Debtors"), the Debtors' senior secured lenders (the "Bank Group" and the Official Committee of Unsecured Creditors (the "Committee" and collectively with the Debtors and the Bank Group, the "Proponents") filed their Emergency Motion for Approval of (i) Bid Procedures; (ii) the Form and Manner of Sale Notices; and (iii) Breakup Fees (the "Sale Procedures Motion"). By the Sale Procedures Motion, the Proponents sought entry of orders (i) establishing an auction date, related deadlines and bid procedures in connection with the sale of substantially all of COLP's operating assets, free and clear of liens, claims and encumbrances (except certain permitted liens), pursuant to the Amended Joint Plan of Reorganization for the Debtors proposed by the Proponents (the "Proponents' Plan"); (ii) approving the form and manner of sale notices to be sent to potential bidders, creditors and parties-in-interest and (iii) approving certain breakup fees and expense reimbursements in connection with the solicitation of higher or better offers. The assets to be sold consist of substantially all of COLP's operating assets, as set forth below.

PLEASE BE FURTHER ADVISED that the following Sale Procedures have been approved by order (the "Sale Procedures Order") of the United States Bankruptcy Court for the Northern District of Texas (the "Court") dated July 3, 2003:

SALE PROCEDURE

The following procedures (the "Sale Procedures") shall govern the bidding process and the sale at auction of certain Purchased Assets (as defined below) of COLP, pursuant to the Proponents Motion for Approval of (i) Bid Procedures; (ii) the Form and Manner of Sale Notices; and (iii) Breakup Fees (the "Sale Procedures Motion"), filed with the Court on July 2, 2003. These Sale Procedures have been approved and authorized by the the Sale Procedures Order in the chapter 11 cases of the Debtors, which cases were commenced on January 3, 2003.

A. Assets to be Sold

The assets to be sold consist of substantially all of the operating assets of COLP, except for certain Excluded Assets, as set forth in the Purchase Agreement (the "Purchased Assets"). The Purchased Assets shall be sold free and clear of all liens, claims, rights, interests and encumbrances, other than certain Permitted Liens. The Proponents shall consider at the Auction (as defined below) bids for the Purchased Assets. An initial bid for the Purchased Assets has been received from the Buyer in the amount of twenty-seven million five hundred thousand dollars ($27,500,000) plus the assumption of certain liabilities, the terms of which are set forth in the Purchase Agreement.

B. Selection of Qualified Bidders

The Debtors will consider other bids for the Purchased Assets, subject to the following terms and conditions:

1. Participation Requirements.

Unless otherwise ordered by the Court, to participate in the bidding process each person must deliver (unless previously delivered) to the attention of Matt Sodl at Murphy Noell Capital, LLC ("Murphy Noell"), 280 N. Westlake Blvd., Suite 200, Westlake Village, CA 01362 (e-mail: mjsodl@murphynoell.com): (a) an executed confidentiality agreement in form and substance satisfactory to the Proponents, and (b) financial information indicating such party's ability to close the proposed transaction. A "Potential Bidder" is an entity that delivers the documents described above and that the Proponents determine is reasonably likely (based on availability of financing, experience and other considerations) to be able to consummate the purchase of the Purchased Assets (the "Sale") if selected as the Successful Bidder within a time frame acceptable to the Proponents. After delivery of the items above the Proponents shall determine whether the bidder is a Potential Bidder, and Murphy Noell shall notify the Potential Bidder of such determination.

2. Bid Deadline

The deadline for Potential Bidders to submit bids to Murphy Noell shall be at 5:00 p.m. (Central) on September 2, 2003 (the "Bid Deadline"). All bids must comply with all Bid Requirements as set forth below. The Proponents, with the written consent of Buyer not to be unreasonably withheld, may extend the Bid Deadline once or successively, but are not obligated to do so. If a proposal or offer (a "Competing Bid") is received from any Potential Bidder (a "Competing Bidder") relating to any acquisition or purchase of all or substantially all of the Purchased Assets, then the Proponents shall promptly communicate and deliver to the Buyer the Competing Bid.

3. Bid Requirements