Exhibit (10)(hh)
 
 
FIRST MODIFICATION AGREEMENT
 
 
THIS FIRST MODIFICATION AGREEMENT is made and entered into this 2nd day of
April, 2010 (the “Effective Date”) by and between PINNACLE NATIONAL BANK
(“Lender”), and J. ALEXANDER’S CORPORATION, a Tennessee corporation
(“Borrower”).
 
W I T N E S S E T H:
 
WHEREAS, Lender extended to Borrower certain indebtedness evidenced and secured
by the following:
 
(a)           Promissory Note dated May 22, 2009 in the original principal
amount of $3,000,000.00 executed by Borrower to Lender (the “Term Loan”);
 
(b)           Revolving Promissory Note dated May 22, 2009 in the original
principal amount of $5,000,000.00 executed by Borrower to Lender (the “Line of
Credit”);
 
(c)           Loan Agreement dated May 22, 2009 by and between Borrower and
Lender;
 
(d)           Assignment and Security Agreement dated May 22, 2009 by and among
Borrower, Lender, J. Alexander’s Restaurants, Inc., a Tennessee corporation, J.
Alexander’s Restaurants of Kansas, Inc., a Kansas corporation, J. Alexander’s of
Texas, Inc., a Texas corporation, and J. Alexander’s of Kansas, LLC, a Kansas
limited liability company;
 
(e)           Guaranty Agreements of J. Alexander’s Restaurants, Inc., J.
Alexander’s Restaurants of Kansas, Inc., J. Alexander’s of Texas, Inc., and J.
Alexander’s of Kansas, LLC (“Guarantors”); and
 
(f)           Certain other documents executed in connection therewith.
 
(the foregoing and any and all other documents executed in connection with the
Term Loan and the Line of Credit, and any and all extensions, renewals and
modifications thereof, being sometimes herein collectively called the “Loan
Documents”).
 
WHEREAS, Lender is the owner and the holder of the indebtedness evidenced and
secured by the Loan Documents, and Lender has agreed to modify the terms and
conditions pertaining to the financial covenants set forth in Paragraph 3.5(b)
of the Loan Agreement, specifically including the adjusted debt to EBITDAR Ratio
for the first and second quarters of 2010.
 
NOW THEREFORE, for and in consideration of the mutual covenants contained
herein, the modification herein granted, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties covenant and agree as follows:
 
 
 
1

--------------------------------------------------------------------------------

 
 
1.           Section 3.5(b) of the Loan Agreement shall be modified to revise
the Adjusted Debt to EBITDAR Ratio covenant as follows:
 
§  
from 4.5 to 1.0 to 5.25 to 1.0 as of the end of the fiscal quarter ending April
4, 2010, and

§  
from 4.5 to 1.0 to 5.0 to 1.0 as of the end of the fiscal quarter ending July 4,
2010.

 
2.           The Loan Documents, as modified herein, are fully enforceable in
accordance with their terms and Borrower has no claim, demand or right of setoff
against Lender arising out of or with respect to any of the Loan Documents, or
the indebtedness evidenced and secured thereby.
 
3.           The Loan Documents are further amended to the extent necessary to
conform to the foregoing, but no further or otherwise.  The Loan Documents shall
continue in full force and effect, amended only as specifically stated
herein.  In the event of default in any provisions of the Loan Documents, as
amended hereby, the provisions of said instruments and documents making the
whole of the indebtedness evidenced and secured due and payable shall be, and
continue to be, in full force and effect (subject to applicable notice and cure
periods), and Lender reserves all rights, remedies and privileges provided in
the Loan Documents, as amended hereby.  This instrument does not constitute a
novation of any of the Loan Documents.
 
4.           Borrower shall pay all reasonable costs and expenses, including but
not limited to, reasonable attorney’s fees, incurred by Lender in connection
with the preparation and consummation of this instrument, and in obtaining,
maintaining and preserving the collateral securing the indebtedness evidenced
and secured by the Loan Documents.  In addition, Borrower shall pay to Lender a
loan modification fee of $15,000.00.  This instrument is severable such that the
invalidity or unenforceability of any provision hereof shall not impair the
validity or enforceability of the remaining provisions.  This instrument shall
be binding upon the parties hereto, their heirs, successors and assigns.  This
instrument shall be governed in accordance with the laws of the State of
Tennessee, except with respect to applicable laws or regulations of the United
States of America governing the charging and receiving of interest.
 
 
 
 
 
[Signature Page Follows]
 
 
 
2

--------------------------------------------------------------------------------

 
 
IN WITNESS WHEREOF, this instrument has been executed to be effective as of the
date first above written.
 
BORROWER:
 
J. ALEXANDER’S CORPORATION,
a Tennessee corporation
 
 
By:           /s/ R. Gregory Lewis
R. Gregory Lewis
Vice President – Finance
Chief Financial Officer, and Secretary
 
LENDER:
 
                                                                PINNACLE
NATIONAL BANK
 
 
By:           /s/ William W. DeCamp
            William W. DeCamp, Senior Vice President
 
 
 
 
 
3

--------------------------------------------------------------------------------

 
 
 
STATE OF TENNESSEE                  )
COUNTY OF DAVIDSON                )
 
Personally appeared before me, the undersigned, a Notary Public in and for said
County and State, R. GREGORY LEWIS, with whom I am personally acquainted, and
who acknowledged that he executed the within instrument for the purposes therein
contained, and who further acknowledged that he is VICE PRESIDENT – FINANCE,
CHIEF FINANCIAL OFFICER, AND SECRETARY of the maker or a constituent of the
maker and is authorized by the maker or by its constituent, the constituent
being authorized by the maker, to execute this instrument on behalf of the
maker.
 
WITNESS my hand, at office, this 2nd day of April, 2010.
 
 
/s/ Janice M. Jackson                                                      
Notary Public
 
My Commission Expires:                  July 2, 2011
 
 
STATE OF TENNESSEE                  )
COUNTY OF DAVIDSON                )
 
Personally appeared before me, the undersigned, a Notary Public in and for said
County and State, WILLIAM W. DECAMP, with whom I am personally acquainted, and
who acknowledged that he executed the within instrument for the purposes therein
contained, and who further acknowledged that he is SENIOR VICE PRESIDENT of the
maker or a constituent of the maker and is authorized by the maker or by its
constituent, the constituent being authorized by the maker, to execute this
instrument on behalf of the maker.
 
WITNESS my hand, at office, this 2nd day of April, 2010.
 
 
/s/ Diana T. Brickey                                                      
Notary Public
 
My Commission Expires:                  January 6, 2014
 
 
 
 
 
4

--------------------------------------------------------------------------------