FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 (Mark One) [x] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended May 31, 1998 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________ to _______________ Commission file number: 1-8308 LUBY'S CAFETERIAS, INC. _______________________________________________________________________________ (Exact name of registrant as specified in its charter) Delaware 74-1335253 _________________________________ ________________________________ (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 2211 Northeast Loop 410, P. O. Box 33069 San Antonio, Texas 78265-3069 _______________________________________________________________________________ (Address of principal executive offices) (Zip Code) 210/654-9000 _______________________________________________________________________________ (Registrant's telephone number, including area code) _______________________________________________________________________________ (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. Yes X No ___ ___ Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common Stock: 23,270,675 shares outstanding as of May 31, 1998 (exclusive of 4,132,392 treasury shares) Part I - FINANCIAL INFORMATION Item 1. Financial Statements. LUBY'S CAFETERIAS, INC. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) Three Months Ended Nine Months Ended May 31, May 31, 1998 1997 1998 1997 ____ ____ ____ ____ (Amounts in thousands except per share data) Sales $131,230 $127,630 $379,106 $368,747 Costs and expenses: Cost of food 33,151 30,978 95,897 90,021 Payroll and related costs 38,765 37,265 115,477 108,544 Occupancy and other operating expenses 39,059 38,317 114,933 111,547 General and administrative expenses 6,658 6,337 17,164 17,517 ________ ________ ________ _______ 117,633 112,897 343,471 327,629 ________ ________ ________ _______ Income from operations 13,597 14,733 35,635 41,118 Interest expense (1,288) (1,078) (3,813) (2,686) Other income, net 342 926 1,245 1,680 ________ ________ ________ _______ Income before income taxes 12,651 14,581 33,067 40,112 Provision for income taxes 4,504 4,998 11,772 13,959 ________ ________ ________ _______ Net income $ 8,147 $ 9,583 $ 21,295 $ 26,153 ________ ________ ________ _______ Net income per share - basic and assuming dilution $.35 $.41 $.92 $1.12 ________ ________ ________ _______ Cash dividends per share $.20 $.20 $.60 $.60 ________ ________ ________ _______ Average number of shares outstanding 23,271 23,366 23,270 23,453 See accompanying notes. Part I - FINANCIAL INFORMATION (continued) Item 1. Financial Statements (continued). LUBY'S CAFETERIAS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) May 31, August 31, 1998 1997 ____ ____ (Thousands of dollars) ASSETS Current assets: Cash and cash equivalents $ 2,312 $ 6,430 Trade accounts and other receivables 684 510 Food and supply inventories 4,950 4,507 Prepaid expenses 4,239 3,586 Deferred income taxes 1,071 937 ________ ________ Total current assets 13,256 15,970 Property held for sale 9,652 12,680 Investments and other assets - at cost 7,549 6,111 Property, plant, and equipment - at cost, net 336,459 334,017 ________ ________ $366,916 $368,778 ________ ________ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable - trade $ 10,853 $ 13,584 Dividends payable 4,654 4,653 Accrued expenses and other liabilities 25,140 25,038 Income taxes payable 2,706 ` 2,406 ________ ________ Total current liabilities 43,353 45,681 Long-term debt 77,000 84,000 Deferred income taxes and other credits 20,294 20,257 Shareholders' equity: Common stock 8,769 8,769 Paid-in capital 26,999 26,945 Retained earnings 283,408 276,140 Less cost of treasury stock (92,907) (93,014) ________ ________ Total shareholders' equity 226,269 218,840 ________ ________ $366,916 $368,778 ________ ________ See accompanying notes. Part I - FINANCIAL INFORMATION (continued) Item 1. Financial Statements (continued). LUBY'S CAFETERIAS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended May 31, 1998 1997 ____ ____ (Thousands of dollars) CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 21,295 $ 26,153 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 15,802 14,913 Increase (decrease) in accrued expenses and other liabilities 143 (1,617) Other, net (5,561) (1,354) ________ ________ Net cash provided by operating activities 31,679 38,095 ________ ________ CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from disposal of property held for sale 3,568 2,300 Purchases of land held for future use (948) (12,134) Purchases of property, plant, and equipment (17,498) (40,839) ________ ________ Net cash used in investing activities (14,878) (50,673) ________ ________ CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issuance of common stock under stock option plan 42 2,878 Proceeds from long-term debt 658,000 760,000 Reductions of long-term debt (665,000) (711,000) Purchases of treasury stock --- (21,077) Dividends paid (13,961) (14,144) ________ ________ Net cash provided by (used in) financing activities (20,919) 16,657 ________ ________ Net increase (decrease) in cash and cash equivalents (4,118) 4,079 Cash and cash equivalents at beginning of period 6,430 2,687 ________ ________ Cash and cash equivalents at end of period $ 2,312 $ 6,766 ________ ________ See accompanying notes. Part I - FINANCIAL INFORMATION (continued) Item 1. Financial Statements (continued). LUBY'S CAFETERIAS, INC. CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY For the Nine Months Ended May 31, 1998 and 1997 (UNAUDITED) Total Common Stock Paid-in Retained Shareholders' Issued Treasury Capital Earnings Equity _______ ________ _______ ________ ____________ (Thousands of dollars) Balance at August 31, 1996 $8,769 $(77,415) $26,945 $267,374 $225,673 Net income for the period --- --- --- 26,153 26,153 Common stock issued under employee benefit plans, net of shares tendered in partial payment and including tax benefits --- 4,320 --- (1,027) 3,293 Cash dividends --- --- --- (14,001) (14,001) Purchases of treasury stock --- (19,919) --- --- (19,919) Balance at May 31, 1997 $8,769 $(93,014) $26,945 $278,499 $221,199 ______ ________ _______ ________ ________ Balance at August 31, 1997 $8,769 $(93,014) $26,945 $276,140 $218,840 Net income for the period --- --- --- 21,295 21,295 Common stock issued under employee benefit plans, net of shares tendered in partial payment and including tax benefits --- 107 54 (65) 96 Cash dividends --- --- --- (13,962) (13,962) ______ ________ _______ ________ ________ Balance at May 31, 1998 $8,769 $(92,907) $26,999 $283,408 $226,269 ______ ________ _______ ________ ________ See accompanying notes. Part I - FINANCIAL INFORMATION (continued) Item 1. Financial Statements (continued). LUBY'S CAFETERIAS, INC. NOTES TO FINANCIAL STATEMENTS May 31, 1998 (UNAUDITED) Note 1: The accompanying unaudited financial statements are presented in accordance with the requirements of Form 10-Q and, consequently, do not include all of the disclosures normally required by generally accepted accounting principles. All adjustments which are, in the opinion of management, necessary to a fair statement of the results for the interim periods have been made. All such adjustments are of a normal recurring nature. The results for the interim period are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the consolidated financial statements and footnotes included in Luby's annual report on Form 10-K for the year ended August 31, 1997. The accounting policies used in preparing these consolidated financial statements are the same as those described in Luby's annual report on Form 10-K. Note 2: During the quarter ended February 28, 1998, the company adopted Statement of Financial Accounting Standards No. 128, Earnings Per Share. Statement 128 replaced the previously reported primary and fully diluted earnings per share with basic and diluted earnings per share. Unlike primary earnings per share, basic earnings per share excludes any dilutive effects of options, warrants, and convertible securities. Diluted earnings per share is very similar to the reviously reported fully diluted earnings per share. Earnings per share amounts for all periods have been restated to conform to the requirements of Statement 128. Part I - FINANCIAL INFORMATION (continued) Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. Liquidity and Capital Resources _______________________________ Cash and cash equivalents decreased by $4,118,000 from the end of the preceding fiscal year to May 31, 1998. All capital expenditures for fiscal 1998 are being funded from cash flows from operations, cash equivalents, and long-term debt. Capital expenditures for the nine months ended May 31, 1998, were $18,446,000. As of May 31, 1998, the company owned three undeveloped land sites and one land site on which a cafeteria is under construction. During fiscal year 1997 the company purchased 897,500 shares of its common stock at a cost of $19,918,000, which are being held as treasury stock. To complete the treasury stock purchases and fund capital expenditures, the company required external financing and borrowed funds under a $125,000,000 line-of-credit agreement. As of May 31, 1998, the amount outstanding under this line of credit was $77,000,000. The company believes that additional financing from external sources can be obtained on terms acceptable to the company in the event such financing is required. Results of Operations _____________________ Quarter ended May 31, 1998 compared to the quarter ended May 31, 1997. ______________________________________________________________________ Sales increased $3,600,000, or 2.8%, due to the addition of five new cafeterias in fiscal 1998 and 27 in fiscal 1997, and due to a slight increase in average sales volume at cafeterias opened over one year. This increase was partially offset by the closing of five units, two in August 1997, two in September 1997, and one in January 1998. Cost of food increased $2,173,000, or 7.0%. As a percentage of sales, food costs were higher versus the prior year due to higher commodity prices resulting from poor weather conditions, new menu item testing, and higher fish prices. Payroll and related costs increased $1,500,000, or 4.0%, due primarily to the increase in sales and the higher federal minimum wage which increased first on October 1, 1996, and again on September 1, 1997. Occupancy and other operating expenses increased $742,000, or 1.9%, due primarily to the increase in sales. This increase was partially offset by lower preopening expenses due to fewer new store openings as compared to the prior year. General and administrative expenses increased $321,000, or 5.1%, due to higher legal and professional fees associated with the company's strategic planning project. This increase was partially offset by a lower profit sharing contribution estimated for fiscal 1998 as compared to the estimate of the contribution for the same period in the prior year. Lump sum severance agreements were recorded during both periods. Interest expense increased $210,000 due primarily to lower capitalized interest on qualifying properties as a result of less construction in the current period. The provision for income taxes decreased $494,000, or 9.9%, due primarily to lower income from operations. The effective income tax rate increased from 34.3% to 35.6% since the rate in the third quarter of fiscal 1997 was more significantly impacted by the company restructuring into a holding company. Nine months ended May 31, 1998 compared to the nine months ended May 31, 1997. _____________________________________________________________________________ Sales increased $10,359,000, or 2.8%, due primarily to the addition of five new cafeterias in fiscal 1998 and 27 in fiscal 1997. The sales increase from new cafeterias was partially offset by a slight decrease in sales volume at cafeterias opened over one year and the closing of five units, two in August 1997, two in September 1997, and one in January 1998. Cost of food increased $5,876,000, or 6.5%, due primarily to the increase in sales. As a percentage of sales, food costs were higher versus the prior year due to higher commodity prices resulting from poor weather conditions, new menu item testing, and product promotions featured during the period which had slightly higher food costs. Payroll and related costs increased $6,933,000, or 6.4%, due primarily to the increase in sales and the higher federal minimum wage which increased first on October 1, 1996, and again on September 1, 1997. Occupancy and other operating expenses increased $3,386,000, or 3.0%, due primarily to the increase in sales. With the slight decline in same-store sales for the nine months ended May 31, 1998, certain fixed expenses in this category have increased as a percentage of sales, including depreciation, property taxes, utilities, rent, repairs, and group insurance. These increases were partially offset by lower preopening expenses due to fewer store openings as compared to the prior period. In addition, managers' salaries, which are based on the profitability of the cafeterias, decreased as a percent of sales due to lower store profits. General and administrative expenses decreased $353,000, or 2.0%, due primarily to a lower profit sharing contribution estimated for fiscal 1998 as compared to the estimate of the contribution for the same period in the prior year. This decrease was partially offset by higher legal and professional fees associated with the company's strategic planning process. Interest expense increased $1,127,000 due to lower capitalized interest on qualifying properties as a result of less construction in the current period and slightly higher borrowing rates under the interest rate swap agreements. The provision for income taxes decreased $2,187,000, or 15.7%, due primarily to lower income from operations. The effective income tax rate increased from 34.8% to 35.6%. The Year 2000 _____________ Some of the company's older computer programs were written using two digits rather than four to define the applicable year. As a result, those computer programs have time-sensitive software that recognizes a date using "00" as the year 1900 rather than the year 2000. This could cause a system failure or miscalculations causing disruptions of operations, including, among other things, a temporary inability to process transactions, code invoices, or engage in similar normal business activities. The company has assessed the issue and will modify or replace its software so that its computer systems function properly with respect to dates in the year 2000 and thereafter. The company does not expect that the year 2000 issue will materially affect future financial results. Forward-Looking Statements __________________________ The company wishes to caution readers that various factors could cause the actual results of the company to differ materially from those indicated by forward-looking statements made from time to time in news releases, reports, proxy statements, registration statements, and other written communications (including the preceding sections of this Management's Discussion and Analysis), as well as oral statements made from time to time by representatives of the company. Except for historical information, matters discussed in such oral and written communications are forward-looking statements that involve risks and uncertainties, including but not limited to general business conditions, the impact of competition, the success of operating initiatives, changes in the cost and supply of food and labor, the seasonality of the company's business, taxes, inflation, and governmental regulations. Part II - OTHER INFORMATION (continued) Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits 2 Agreement and Plan of Merger dated November 1, 1991, between Luby's Cafeterias, Inc., a Texas corporation, and Luby's Cafeterias, Inc., a Delaware corporation (filed as Exhibit 2 to the company's Quarterly Report on Form 10-Q for the quarter ended November 30, 1991, and incorporated herein by reference). 3(a) Certificate of Incorporation of Luby's Cafeterias, Inc., a Delaware corporation, as in effect February 28, 1994 (filed as Exhibit 3(a) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1994, and incorporated herein by reference). 3(b) Bylaws of Luby's Cafeterias, Inc. as currently in effect (filed as Exhibit 3(c) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). 4(a) Description of Common Stock Purchase Rights of Luby's Cafeterias, Inc. in Form 8-A (filed April 17, 1991, effective April 26, 1991, File No. 1-8308, and incorporated herein by reference). 4(b) Amendment No. 1 dated December 19, 1991, to Rights Agreement dated April 16, 1991 (filed as Exhibit 4(b) to the company's Quarterly Report on Form 10-Q for the quarter ended November 30, 1991, and incorporated herein by reference). 4(c) Amendment No. 2 dated February 7, 1995, to Rights Agreement dated April 16, 1991 (filed as Exhibit 4(d) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1995, and incorporated herein by reference). 4(d) Amendment No. 3 dated May 29, 1995, to Rights Agreement dated April 16, 1991 (filed as Exhibit 4(d) to the company's Quarterly Report on Form 10-Q for the quarter ended May 31, 1995, and incorporated herein by reference). 4(e) Credit Agreement dated February 27, 1996, among Luby's Cafeterias, Inc., Certain Lenders, and NationsBank of Texas, N.A. (filed as Exhibit 4(e) to the company's Quarterly Report on Form 10-Q for the quarter ended February 29, 1996, and incorporated herein by reference). 4(f) First Amendment to Credit Agreement dated January 24, 1997, among Luby's Cafeterias, Inc., Certain Lenders, and NationsBank of Texas, N.A. (filed as Exhibit 4(f) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 4(g) ISDA Master Agreement dated June 17, 1997, between Luby's Cafeterias, Inc. and NationsBank, N.A., with Schedule and Confirmation dated July 7, 1997 (filed as Exhibit 4(g) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 4(h) ISDA Master Agreement dated July 2, 1997, between Luby's Cafeterias, Inc. and Texas Commerce Bank National Association, with Schedule and Confirmation dated July 2, 1997 (filed as Exhibit 4(h) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 4(i) Second Amendment to Credit Agreement dated July 3, 1997, among Luby's Cafeterias, Inc., Certain Lenders, and NationsBank of Texas, N.A. (filed as Exhibit 4(i) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 10(a) Form of Deferred Compensation Agreement entered into between Luby's Cafeterias, Inc. and various officers (filed as Exhibit 10(b) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1981, and incorporated herein by reference). 10(b) Form of Amendment to Deferred Compensation Agreement between Luby's Cafeterias, Inc. and various officers and former officers adopted January 14, 1997 (filed as Exhibit 10(b) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(c) Annual Incentive Plan for Area Vice Presidents of Luby's Cafeterias, Inc. adopted October 19, 1983 (filed as Exhibit 10(d) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1983, and incorporated herein by reference). 10(d) Amendment to Annual Incentive Plan for Area Vice Presidents of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(d) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(e) Incentive Bonus Plan of Luby's Cafeterias, Inc. adopted October 19, 1983 (filed as Exhibit 10(e) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1983, and incorporated herein by reference). 10(f) Amendment to Incentive Bonus Plan of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(f) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(g) Luby's Cafeterias, Inc. Incentive Bonus Plan for Fiscal 1998 adopted by the Board of Directors on January 9, 1998 (filed as Exhibit 10(g) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). 10(h) Performance Unit Plan of Luby's Cafeterias, Inc. approved by the shareholders on January 12, 1984 (filed as Exhibit 10(f) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1984, and incorporated herein by reference). 10(i) Amendment to Performance Unit Plan of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(h) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(j) Employment Contract dated January 8, 1988, between Luby's Cafeterias, Inc. and George H. Wenglein (filed as Exhibit 10(h) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1988, and incorporated herein by reference). 10(k) Management Incentive Stock Plan of Luby's Cafeterias, Inc. (filed as Exhibit 10(i) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1989, and incorporated herein by reference). 10(l) Amendment to Management Incentive Stock Plan of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(k) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(m) Nonemployee Director Deferred Compensation Plan of Luby's Cafeterias, Inc. adopted October 27, 1994 (filed as Exhibit 10(g) to the company's Quarterly Report on Form 10-Q for the quarter ended November 30, 1994, and incorporated herein by reference). 10(n) Amendment to Nonemployee Director Deferred Compensation Plan of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(m) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(o) Amendment to Nonemployee Director Deferred Compensation Plan of Luby's Cafeterias, Inc. adopted by the Board of Directors on March 19, 1998 (filed as Exhibit 10(o) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). 10(p) Nonemployee Director Stock Option Plan of Luby's Cafeterias, Inc. approved by the shareholders on January 13, 1995 (filed as Exhibit 10(h) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1995, and incorporated herein by reference). 10(q) Amendment to Nonemployee Director Stock Option Plan of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(o) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(r) Employment Contract dated January 12, 1996, between Luby's Cafeterias, Inc. and John B. Lahourcade (filed as Exhibit 10(i) to the company's Quarterly Report on Form 10-Q for the quarter ended February 29, 1996, and incorporated herein by reference). 10(s) Luby's Cafeterias, Inc. Supplemental Executive Retirement Plan dated May 30, 1996 (filed as Exhibit 10(j) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1996, and incorporated herein by reference). 10(t) Amendment to Luby's Cafeterias, Inc. Supplemental Executive Retirement Plan adopted January 14, 1997 (filed as Exhibit 10(r) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(u) Amendment to Luby's Cafeterias, Inc. Supplemental Executive Retirement Plan adopted by the Board of Directors on January 9, 1998 (filed as Exhibit 10(u) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). 10(v) Luby's Cafeterias, Inc. Welfare Benefit Plan Trust dated July 18, 1996 (filed as Exhibit 10(k) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1996, and incorporated herein by reference). 10(w) Retirement Agreement dated March 17, 1997, between Luby's Cafeterias, Inc. and Ralph Erben (filed as Exhibit 10(t) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(x) Employment Agreement dated September 15, 1997, between Luby's Cafeterias, Inc. and Barry J.C. Parker (filed as Exhibit 10(u) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 10(y) Term Promissory Note of Barry J.C. Parker in favor of Luby's Cafeterias, Inc., dated November 10, 1997, in the original principal sum of $199,999.00 (filed as Exhibit 10(v) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 10(z) Stock Agreement dated November 10, 1997, between Barry J.C. Parker and Luby's Cafeterias, Inc. (filed as Exhibit 10(w) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 10(aa) Luby's Cafeterias, Inc. Nonemployee Director Phantom Stock Plan adopted by the Board of Directors on March 19, 1998 (filed as Exhibit 10(aa) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). 10(bb) Agreement of Resignation, Severance, Confidentiality, Non-Solicitation, Arbitration and General Release of All Claims dated April 30, 1998, between Luby's Cafeterias, Inc. and William E. Robson. 10(cc) Salary Continuation Agreement dated May 14, 1998, between Luby's Cafeterias, Inc. and Sue Elliott. 10(dd) Salary Continuation Agreement dated June 1, 1998, between Luby's Cafeterias, Inc. and Alan M. Davis. 11 Statement re computation of per share earnings. 99 Corporate Governance Guidelines of Luby's Cafeterias, Inc. adopted by the Board of Directors on March 19, 1998 (filed as Exhibit 99 to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). (b) Reports on Form 8-K No reports on Form 8-K have been filed during the quarter for which this report is filed. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. LUBY'S CAFETERIAS, INC. (Registrant) BARRY J.C. PARKER By: _____________________________ Barry J. C. Parker President and Chief Executive Officer LAURA M. BISHOP By: _____________________________ Laura M. Bishop Senior Vice President and Chief Financial Officer Dated: July 6, 1998 EXHIBIT INDEX Number Document 2 Agreement and Plan of Merger dated November 1, 1991, between Luby's Cafeterias, Inc., a Texas corporation, and Luby's Cafeterias, Inc., a Delaware corporation (filed as Exhibit 2 to the company's Quarterly Report on Form 10-Q for the quarter ended November 30, 1991, and incorporated herein by reference). 3(a) Certificate of Incorporation of Luby's Cafeterias, Inc., a Delaware corporation, as in effect February 28, 1994 (filed as Exhibit 3(a) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1994, and incorporated herein by reference). 3(b) Bylaws of Luby's Cafeterias, Inc. as currently in effect (filed as Exhibit 3(c) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). 4(a) Description of Common Stock Purchase Rights of Luby's Cafeterias, Inc. in Form 8-A (filed April 17, 1991, effective April 26, 1991, File No. 1-8308, and incorporated herein by reference). 4(b) Amendment No. 1 dated December 19, 1991, to Rights Agreement dated April 16, 1991 (filed as Exhibit 4(b) to the company's Quarterly Report on Form 10-Q for the quarter ended November 30, 1991, and incorporated herein by reference). 4(c) Amendment No. 2 dated February 7, 1995, to Rights Agreement dated April 16, 1991 (filed as Exhibit 4(d) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1995, and incorporated herein by reference). 4(d) Amendment No. 3 dated May 29, 1995, to Rights Agreement dated April 16, 1991 (filed as Exhibit 4(d) to the company's Quarterly Report on Form 10-Q for the quarter ended May 31, 1995, and incorporated herein by reference). 4(e) Credit Agreement dated February 27, 1996, among Luby's Cafeterias, Inc., Certain Lenders, and NationsBank of Texas, N.A. (filed as Exhibit 4(e) to the company's Quarterly Report on Form 10-Q for the quarter ended February 29, 1996, and incorporated herein by reference). 4(f) First Amendment to Credit Agreement dated January 24, 1997, among Luby's Cafeterias, Inc., Certain Lenders, and NationsBank of Texas, N.A. (filed as Exhibit 4(f) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 4(g) ISDA Master Agreement dated June 17, 1997, between Luby's Cafeterias, Inc. and NationsBank, N.A., with Schedule and Confirmation dated July 7, 1997 (filed as Exhibit 4(g) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 4(h) ISDA Master Agreement dated July 2, 1997, between Luby's Cafeterias, Inc. and Texas Commerce Bank National Association, with Schedule and Confirmation dated July 2, 1997 (filed as Exhibit 4(h) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 4(i) Second Amendment to Credit Agreement dated July 3, 1997, among Luby's Cafeterias, Inc., Certain Lenders, and NationsBank of Texas, N.A. (filed as Exhibit 4(i) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 10(a) Form of Deferred Compensation Agreement entered into between Luby's Cafeterias, Inc. and various officers (filed as Exhibit 10(b) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1981, and incorporated herein by reference). 10(b) Form of Amendment to Deferred Compensation Agreement between Luby's Cafeterias, Inc. and various officers and former officers adopted January 14, 1997 (filed as Exhibit 10(b) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(c) Annual Incentive Plan for Area Vice Presidents of Luby's Cafeterias, Inc. adopted October 19, 1983 (filed as Exhibit 10(d) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1983, and incorporated herein by reference). 10(d) Amendment to Annual Incentive Plan for Area Vice Presidents of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(d) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(e) Incentive Bonus Plan of Luby's Cafeterias, Inc. adopted October 19, 1983 (filed as Exhibit 10(e) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1983, and incorporated herein by reference). 10(f) Amendment to Incentive Bonus Plan of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(f) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(g) Luby's Cafeterias, Inc. Incentive Bonus Plan for Fiscal 1998 adopted by the Board of Directors on January 9, 1998 (filed as Exhibit 10(g) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). 10(h) Performance Unit Plan of Luby's Cafeterias, Inc. approved by the shareholders on January 12, 1984 (filed as Exhibit 10(f) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1984, and incorporated herein by reference). 10(i) Amendment to Performance Unit Plan of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(h) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(j) Employment Contract dated January 8, 1988, between Luby's Cafeterias, Inc. and George H. Wenglein (filed as Exhibit 10(h) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1988, and incorporated herein by reference). 10(k) Management Incentive Stock Plan of Luby's Cafeterias, Inc. (filed as Exhibit 10(i) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1989, and incorporated herein by reference). 10(l) Amendment to Management Incentive Stock Plan of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(k) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(m) Nonemployee Director Deferred Compensation Plan of Luby's Cafeterias, Inc. adopted October 27, 1994 (filed as Exhibit 10(g) to the company's Quarterly Report on Form 10-Q for the quarter ended November 30, 1994, and incorporated herein by reference). 10(n) Amendment to Nonemployee Director Deferred Compensation Plan of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(m) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(o) Amendment to Nonemployee Director Deferred Compensation Plan of Luby's Cafeterias, Inc. adopted by the Board of Directors on March 19, 1998 (filed as Exhibit 10(o) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). 10(p) Nonemployee Director Stock Option Plan of Luby's Cafeterias, Inc. approved by the shareholders on January 13, 1995 (filed as Exhibit 10(h) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1995, and incorporated herein by reference). 10(q) Amendment to Nonemployee Director Stock Option Plan of Luby's Cafeterias, Inc. adopted January 14, 1997 (filed as Exhibit 10(o) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(r) Employment Contract dated January 12, 1996, between Luby's Cafeterias, Inc. and John B. Lahourcade (filed as Exhibit 10(i) to the company's Quarterly Report on Form 10-Q for the quarter ended February 29, 1996, and incorporated herein by reference). 10(s) Luby's Cafeterias, Inc. Supplemental Executive Retirement Plan dated May 30, 1996 (filed as Exhibit 10(j) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1996, and incorporated herein by reference). 10(t) Amendment to Luby's Cafeterias, Inc. Supplemental Executive Retirement Plan adopted January 14, 1997 (filed as Exhibit 10(r) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(u) Amendment to Luby's Cafeterias, Inc. Supplemental Executive Retirement Plan adopted by the Board of Directors on January 9, 1998 (filed as Exhibit 10(u) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). 10(v) Luby's Cafeterias, Inc. Welfare Benefit Plan Trust dated July 18, 1996 (filed as Exhibit 10(k) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1996, and incorporated herein by reference). 10(w) Retirement Agreement dated March 17, 1997, between Luby's Cafeterias, Inc. and Ralph Erben (filed as Exhibit 10(t) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1997, and incorporated herein by reference). 10(x) Employment Agreement dated September 15, 1997, between Luby's Cafeterias, Inc. and Barry J.C. Parker (filed as Exhibit 10(u) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 10(y) Term Promissory Note of Barry J.C. Parker in favor of Luby's Cafeterias, Inc., dated November 10, 1997, in the original principal sum of $199,999.00 (filed as Exhibit 10(v) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 10(z) Stock Agreement dated November 10, 1997, between Barry J.C. Parker and Luby's Cafeterias, Inc. (filed as Exhibit 10(w) to the company's Annual Report on Form 10-K for the fiscal year ended August 31, 1997, and incorporated herein by reference). 10(aa) Luby's Cafeterias, Inc. Nonemployee Director Phantom Stock Plan adopted by the Board of Directors on March 19, 1998 (filed as Exhibit 10(aa) to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference). 10(bb) Agreement of Resignation, Severance, Confidentiality, Non- Solicitation, Arbitration and General Release of All Claims dated April 30, 1998, between Luby's Cafeterias, Inc. and William E. Robson. 10(cc) Salary Continuation Agreement dated May 14, 1998, between Luby's Cafeterias, Inc. and Sue Elliott. 10(dd) Salary Continuation Agreement dated June 1, 1998, between Luby's Cafeterias, Inc. and Alan M. Davis. 11 Statement re computation of per share earnings. 99 Corporate Governance Guidelines of Luby's Cafeterias, Inc. adopted by the Board of Directors on March 19, 1998 (filed as Exhibit 99 to the company's Quarterly Report on Form 10-Q for the quarter ended February 28, 1998, and incorporated herein by reference).