Document:

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                                                                    EXHIBIT 10.2

                                    AGREEMENT

         THIS AGREEMENT is entered into this 29th day of July 2003 by and
between GLOBALSANTAFE CORPORATION, a Cayman Islands corporation (the "Company"),
and ________________ (the "Executive").

         WHEREAS, the Company's Board of Directors (the "Board") has determined
that it is in the best interests of the Company and its shareholders to ensure
that the Company and its affiliates will have the continued dedication of the
Executive, notwithstanding the possibility, threat or occurrence of a
termination of the Executive's employment in certain circumstances, including
following a Change in Control as defined herein; and

         WHEREAS, the Board believes it is imperative to diminish the inevitable
distraction of the Executive by virtue of the personal uncertainties and risks
created by a pending or threatened termination of the Executive's employment in
such circumstances and to provide the Executive with compensation and benefits
arrangements upon such a termination which ensure that the compensation and
benefits expectations of the Executive will be satisfied and which are
competitive with those of other corporations;

         NOW, THEREFORE, in order to accomplish these objectives, the Board has
caused the Company to enter into this Agreement with the Executive, and it is
hereby agreed as follows:

1. Definitions. For purposes of this Agreement, the following terms will have
the following meanings unless otherwise expressly provided in this Agreement:

         (a)      Beneficiary. "Beneficiary" means any individual, trust or
                  other entity named by the Executive to receive the severance
                  payments and benefits payable hereunder in the event of the
                  death of the Executive during the Salary Continuation Period
                  or CIC Salary Continuation Period (both as defined hereunder).
                  Executive may designate a Beneficiary to receive such payments
                  and benefits by completing a form provided by the Company and
                  delivering it to the Company's Secretary. The Executive may
                  change the Executive's designated Beneficiary at any time
                  (without the consent of any prior Beneficiary) by completing
                  and delivering to the Company a new beneficiary designation
                  form. If a Beneficiary has not been designated by the
                  Executive, or if no designated Beneficiary survives the
                  Executive, then the payment and benefits provided under this
                  Agreement, if any, will be paid to the Executive's estate.

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         (b)      Cause. "Cause" means an act or acts of misconduct harmful to
                  the Company or any of its affiliates, including without
                  limitation any violation of any policy regarding the use and
                  possession of alcohol, illegal drugs, firearms or dangerous
                  weapons that is applicable to the employees of the Company and
                  its affiliates generally, and will not mean inadequate
                  performance or incompetence.

         (c)      Change in Control. A "Change in Control" means the occurrence
                  of any of the following events:

                  (i)      The acquisition by any individual, entity or group
                           (within the meaning of Section 13(d) or 14(d) of the
                           U.S. Securities Exchange Act of 1934, as amended (the
                           "Exchange Act")) (a "Person") of beneficial ownership
                           (within the meaning of Rule 13d-3 under the Exchange
                           Act) of 35% or more of either (A) the then
                           outstanding ordinary shares of the Company or of any
                           affiliate of the Company by which the Executive is
                           employed or which directly or indirectly owns or
                           controls any affiliate by which the Executive is
                           employed (the "Outstanding Company Ordinary Shares")
                           or (B) the combined voting power of the then
                           outstanding voting securities of the Company or of
                           any affiliate of the Company by which the Executive
                           is employed or which directly or indirectly owns or
                           controls any affiliate by which the Executive is
                           employed entitled to vote generally in the election
                           of directors (the "Outstanding Company Voting
                           Securities"); provided, however, that the following
                           acquisitions will not constitute a Change in Control:
                           (I) any acquisition by the Company or by any
                           affiliate of the Company that remains under the
                           Company's control, (II) any acquisition by any
                           employee benefit plan (or related trust) sponsored or
                           maintained by the Company or by any affiliate
                           controlled by the Company, (III) the sale, exchange,
                           transfer or other disposition of substantially all of
                           the assets of the Company or of any affiliate of the
                           Company by which the Executive is employed or which
                           directly or indirectly owns or controls any affiliate
                           by which the Executive is employed to the Chief
                           Executive Officer of the Company or of any affiliate
                           of the Company by which the Executive is employed or
                           which directly or indirectly owns or controls any
                           affiliate by which the Executive is employed (the
                           "CEO"), alone or with other officers, or a merger,
                           consolidation or other reorganization involving the
                           Company or any affiliate of the Company by which the
                           Executive is employed or which directly or indirectly
                           owns or controls any affiliate by which the Executive
                           is employed and the CEO, alone or with other
                           officers, or any entity in which the CEO (alone or
                           with other officers) has, directly or indirectly, a
                           substantial equity or ownership interest, (IV) a
                           transaction otherwise commonly referred to as a

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                           "management leveraged buyout," or (V) any acquisition
                           by any corporation pursuant to a reorganization,
                           merger or consolidation, if, following such
                           reorganization, merger or consolidation, the
                           conditions described in clauses (I), (II), (III), or
                           (IV) are satisfied; or

                  (ii)     Individuals who, as of the date hereof, constitute
                           the Board (the "Incumbent Board") cease for any
                           reason to constitute at least a majority of the
                           Board; provided, however, that any individual
                           becoming a director subsequent to the date hereof
                           whose election, or nomination for election by the
                           Company's shareholders, was approved by a vote of at
                           least a majority of the directors then comprising the
                           Incumbent Board will be considered as though such
                           individual were a member of the Incumbent Board, but
                           excluding for this purpose any such individual whose
                           initial assumption of office occurs as a result of
                           either an actual or threatened election contest
                           (meaning a solicitation of the type that would be
                           subject to Rule 14a-12(c) of Regulation 14A under the
                           Exchange Act) or other actual or threatened
                           solicitation of proxies or consents by or on behalf
                           of a Person other than the Board; or

                  (iii)    Approval by the shareholders of the Company of a
                           reorganization, merger or consolidation, in each case
                           unless, following such reorganization, merger or
                           consolidation, (A) more than 50% of, respectively,
                           the then outstanding common or ordinary shares of the
                           corporation resulting from such reorganization,
                           merger or consolidation and the combined voting power
                           of the then outstanding voting securities of such
                           corporation entitled to vote generally in the
                           election of directors is then beneficially owned,
                           directly or indirectly, by all or substantially all
                           of the individuals and entities who were the
                           beneficial owners, respectively, of the Outstanding
                           Company Ordinary Shares and Outstanding Company
                           Voting Securities immediately prior to such
                           reorganization, merger or consolidation in
                           substantially the same proportions as their
                           ownership, immediately prior to such reorganization,
                           merger or consolidation, of the Outstanding Company
                           Ordinary Shares and Outstanding Company Voting
                           Securities, as the case may be, (B) no Person
                           (excluding the Company, any affiliate of the Company
                           that remains under the Company's control, any
                           employee benefit plan (or related trust) sponsored or
                           maintained by the Company or by any affiliate
                           controlled by the Company or such corporation
                           resulting from such reorganization, merger or
                           consolidation, and any Person beneficially owning,
                           immediately prior to such reorganization, merger or
                           consolidation, directly or indirectly, 35% or more of
                           the Outstanding Company Ordinary Shares or
                           Outstanding Company Voting Securities, as the case
                           may be)

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                           beneficially owns, directly or indirectly, 35% or
                           more of, respectively, the then outstanding common or
                           ordinary shares of the corporation resulting from
                           such reorganization, merger or consolidation or the
                           combined voting power of the then outstanding voting
                           securities of such corporation entitled to vote
                           generally in the election of directors, and (C) at
                           least a majority of the members of the board of
                           directors of the corporation resulting from such
                           reorganization, merger or consolidation were members
                           of the Incumbent Board at the time of the execution
                           of the initial agreement providing for such
                           reorganization, merger or consolidation; or

                  (iv)     Approval by the shareholders of the Company of any
                           plan or proposal which would result directly or
                           indirectly in (A) a complete liquidation or
                           dissolution of the Company or of any affiliate of the
                           Company by which the Executive is employed, or (B)
                           the liquidation, transfer, sale or other disposition
                           of all or substantially all of the assets of the
                           Company or of any affiliate of the Company by which
                           the Executive is employed or which directly or
                           indirectly owns or controls any affiliate by which
                           the Executive is employed, other than to a
                           corporation with respect to which following such sale
                           or other disposition (I) more than 50% of,
                           respectively, the then outstanding common or ordinary
                           shares of such corporation and the combined voting
                           power of the then outstanding voting securities of
                           such corporation entitled to vote generally in the
                           election of directors is then beneficially owned,
                           directly or indirectly, by all or substantially all
                           of the individuals and entities who were the
                           beneficial owners, respectively, of the Outstanding
                           Company Ordinary Shares and Outstanding Company
                           Voting Securities immediately prior to such sale or
                           other disposition in substantially the same
                           proportions as their ownership, immediately prior to
                           such sale or other disposition, of the Outstanding
                           Company Ordinary Shares and Outstanding Company
                           Voting Securities, as the case may be, (II) no Person
                           (excluding the Company, any affiliate of the Company
                           that remains under the Company's control, any
                           employee benefit plan (or related trust) sponsored or
                           maintained by the Company or by any affiliate
                           controlled by the Company or such corporation, and
                           any Person beneficially owning, immediately prior to
                           such sale or other disposition, directly or
                           indirectly, 35% or more of the Outstanding Company
                           Ordinary Shares or Outstanding Company Voting
                           Securities, as the case may be) beneficially owns,
                           directly or indirectly, 35% or more of, respectively,
                           the then outstanding common or ordinary shares of
                           such corporation or the combined voting power of the
                           then outstanding voting securities of such
                           corporation entitled to vote generally in the
                           election of

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                           directors, and (III) at least a majority of the
                           members of the board of directors of such corporation
                           were members of the Incumbent Board at the time of
                           the execution of the initial agreement or action of
                           the Board providing for such sale or other
                           disposition of assets.

         (d)      Disability. "Disability" means the Executive's total
                  disability as defined under the terms of the Company's
                  long-term disability plan in effect on the Date of
                  Termination.

         (e)      Effective Period. The "Effective Period" means the 36-month
                  period following any Change in Control.

         (f)      Good Reason. "Good Reason" means, unless the Executive has
                  consented in writing thereto, the occurrence of any of the
                  following:

                  (i)      A reduction in the Executive's title, or one or more
                           reductions in the Executive's authority, duties or
                           responsibilities which when considered in the
                           aggregate are material, excluding for this purpose
                           any such reductions remedied by the Company or the
                           Executive's employer promptly after receipt of notice
                           thereof given by the Executive;

                  (ii)     A reduction by the Company or the Executive's
                           employer in the Executive's base salary;

                  (iii)    The relocation of the Executive's office to a
                           location more than 40 miles outside Houston, Texas;

                  (iv)     Following a Change in Control, unless a plan
                           providing a substantially similar compensation or
                           benefit is substituted, (A) the failure by the
                           Company or any of its affiliates to continue in
                           effect any material fringe benefit or compensation
                           plan, retirement plan, life insurance plan, health
                           and accident plan or disability plan in which the
                           Executive is participating prior to the Change in
                           Control, or (B) the taking of any action by the
                           Company or any of its affiliates which would
                           adversely affect the Executive's participation in or
                           materially reduce the Executive's benefits under any
                           of such plans or deprive the Executive of any
                           material fringe benefit; or

                  (v)      Following a Change in Control, the failure of the
                           Company or the affiliate of the Company by which the
                           Executive is employed, or any affiliate which
                           directly or indirectly owns or controls any affiliate
                           by which the Executive is employed, to obtain the
                           assumption in writing of the Company's obligation to
                           perform this Agreement by any successor to all or
                           substantially all of the assets of the

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                           Company or such affiliate within 15 days after a
                           reorganization, merger, consolidation, sale or other
                           disposition of assets of the Company or such
                           affiliate.

2. Term. The term ("Term") of this Agreement will commence on the date first
above written (the "Commencement Date") and will end when the Executive is no
longer an employee of the Company and its affiliates and has received all
severance payments and benefits to which the Executive is entitled under this
Agreement.

3. Notice of Termination. Any termination of the Executive's employment by the
Company, or by any affiliate of the Company by which the Executive is employed,
for Cause, or by the Executive for Good Reason will be communicated by Notice of
Termination to the other party hereto given in accordance with Paragraph 12 of
this Agreement. For purposes of this Agreement, a "Notice of Termination" means
a written notice which (a) indicates the specific termination provision in this
Agreement relied upon, (b) to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive's employment under the provision so indicated, and (c) if the Date
of Termination (as defined below) is other than the date of receipt of such
notice, specifies the employment termination date. The failure to set forth in
the Notice of Termination any fact or circumstance which contributes to a
showing of Good Reason or Cause will not waive any right of the party giving the
Notice of Termination hereunder or preclude such party from asserting such fact
or circumstance in enforcing its rights hereunder.

4. Date of Termination. "Date of Termination" means the date of receipt of the
Notice of Termination or any later date specified therein, or the Executive's
last date as an active employee of the Company and its affiliates before a
termination of employment due to death or disability, or a termination other
than for Cause, as the case may be.

5. Obligations of the Company Upon Termination of Executive's Employment.

         (a)      Termination of Employment for Good Reason or Other Than for
                  Cause. The Company will pay the following severance payments
                  and benefits to the Executive upon the termination of the
                  Executive's employment with the Company and its affiliates, by
                  the Company or by any affiliate of the Company by which the
                  Executive is employed, other than for Cause, or by the
                  Executive for Good Reason within six months following the
                  occurrence of any event constituting Good Reason:

                  (i)      Cash in the amount of the Executive's annual base
                           salary through the Date of Termination to the extent
                           not theretofore paid;

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                  (ii)     Any and all compensation deferred under a deferred
                           compensation plan or program of the Company or any of
                           its affiliates in a lump sum cash payment;

                  (iii)    Cash in an amount equal to the product of two times
                           the Executive's annual base salary at the rate in
                           effect at the time Notice of Termination is given,
                           payable in equal monthly installments over a period
                           of two years following the Date of Termination (the
                           "Salary Continuation Period");

                  (iv)     If recommended specifically in the Executive's case
                           by the Company's Chief Executive Officer and approved
                           specifically in the Executive's case by the Board's
                           Compensation Committee, in their sole and absolute
                           discretion, a lump sum cash amount equal to the sum
                           of actual bonuses paid or payable, including any
                           amount deferred (whether mandatory or elective), to
                           the Executive in the two years immediately prior to
                           the Date of Termination, payable within 30 days after
                           the Date of Termination;

                  (v)      The continuation of the provision of health
                           insurance, dental insurance and life insurance
                           benefits for the Salary Continuation Period to the
                           Executive and the Executive's family at least equal
                           to those which would have been provided to them in
                           accordance with the plans, programs, practices and
                           policies of the Company as in effect and applicable
                           generally to other peer executives and their families
                           during the 90-day period immediately preceding the
                           Date of Termination; provided, however, that if the
                           Executive becomes re-employed with another employer
                           and is eligible to receive medical or other welfare
                           benefits under another employer provided plan, the
                           medical and other welfare benefits described herein
                           will be secondary to those provided under such other
                           plan during such applicable period of eligibility;

                  (vi)     The continued accrual of years of service under any
                           and all defined benefit retirement plans sponsored or
                           maintained by the Company or by any affiliate
                           controlled by the Company in effect on and in which
                           the Executive was a participant on the Date of
                           Termination, in each case for the Salary Continuation
                           Period, but in no event beyond the date the Executive
                           or Executive's spouse begins to receive a benefit
                           under any such plan; and

                  (vii)    The immediate vesting of benefits under the Company's
                           Executive Supplemental Retirement Plan as amended and
                           in effect at the Date of Termination, as if the
                           Executive had attained at least age 55 and at least 5
                           years of service, thereby entitling the Executive to

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                           Normal Retirement Benefits commencing at any time on
                           or after the Executive's Normal Retirement Date or
                           Early Retirement Benefits commencing at any time on
                           or after the Executive attains or would have attained
                           age 55, in each case as such term is defined in said
                           plan; and, to the extent permitted by applicable
                           governmental laws and regulations, immediate
                           eligibility for any and all non-pension
                           post-retirement benefits under any and all plans and
                           policies of the Company or any affiliate of the
                           Company, as amended and in effect at the Date of
                           Termination, as if the Executive had attained at
                           least age 55 and regardless of whether or not the
                           Executive actually retires under any pension or
                           retirement plan, provided, however, that the
                           Executive must also meet any and all other
                           requirements under such plans and policies in order
                           to participate in such benefits.

         (b)      Termination of Employment Following a Change in Control. If,
                  during the Effective Period, the Company or any affiliate of
                  the Company by which the Executive is employed terminates the
                  Executive's employment, other than for Cause, or any event
                  constituting Good Reason occurs and the Executive terminates
                  employment with the Company for Good Reason within six months
                  after such occurrence, the Company will pay the following to
                  the Executive:

                  (i)      Cash in the amount of the Executive's annual base
                           salary through the Date of Termination to the extent
                           not theretofore paid;

                  (ii)     Any and all compensation deferred under a deferred
                           compensation plan or program of the Company or any of
                           its affiliates in a lump sum cash payment;

                  (iii)    Cash in an amount equal to the product of three times
                           the Executive's annual base salary at the greater of
                           (A) the rate in effect at the time Notice of
                           Termination is given or (B) the rate in effect
                           immediately preceding the Change in Control, payable
                           in equal monthly installments over a period of three
                           years following the Date of Termination (the "CIC
                           Salary Continuation Period");

                  (iv)     A lump sum cash amount equal to the product of three
                           times the highest total bonus paid or payable in any
                           one year, including any amounts deferred (whether
                           mandatory or elective), to the Executive in the three
                           years immediately prior to the Date of Termination;

                  (v)      The continuation of the provision of health
                           insurance, dental insurance and life insurance
                           benefits for the CIC Salary Continuation Period to
                           the Executive and the Executive's family at

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                           least equal to those which would have been provided
                           to them in accordance with the plans, programs,
                           practices and policies of the Company as in effect
                           and applicable generally to other peer executives and
                           their families during the 90-day period immediately
                           preceding the Effective Period or on the Date of
                           Termination, at the election of the Executive;
                           provided, however, that if the Executive becomes
                           re-employed with another employer and is eligible to
                           receive medical or other welfare benefits under
                           another employer provided plan, the medical and other
                           welfare benefits described herein will be secondary
                           to those provided under such other plan during such
                           applicable period of eligibility;

                  (vi)     The continued accrual of years of service under any
                           and all defined benefit retirement plans sponsored or
                           maintained by the Company or by any affiliate
                           controlled by the Company in effect on and in which
                           the Executive was a Participant on the Date of
                           Termination, in each case for the CIC Salary
                           Continuation Period, but in no event beyond the date
                           the Executive or Executive's spouse begins to receive
                           a benefit under any such plan; and

                  (vii)    The immediate vesting of benefits under the Company's
                           Executive Supplemental Retirement Plan as amended and
                           in effect at either the Date of Termination or
                           immediately preceding the Change in Control, at the
                           election of the Executive, as if the Executive had
                           attained at least age 55 and at least 5 years of
                           service, thereby entitling the Executive to Normal
                           Retirement Benefits commencing at any time on or
                           after the Executive's Normal Retirement Date or Early
                           Retirement Benefits commencing at any time on or
                           after the Executive attains or would have attained
                           age 55, in each case as such term is defined in said
                           plan; and, to the extent permitted by applicable
                           governmental laws and regulations, immediate
                           eligibility for any and all non-pension
                           post-retirement benefits under any and all plans and
                           policies of the Company or any affiliate of the
                           Company, as amended and in effect at either the Date
                           of Termination or immediately preceding the Change in
                           Control, at the election of the Executive, as if the
                           Executive had attained at least age 55 and regardless
                           of whether or not the Executive actually retires
                           under any pension or retirement plan, provided,
                           however, that the Executive must also meet any and
                           all other requirements under such plans and policies
                           in order to participate in such benefits.

         (c)      Termination of Employment Upon Executive's Disability. In the
                  event of the termination of the Executive's employment with
                  the Company and its affiliates due to the Executive's
                  Disability, the Company will pay to the

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                  Executive the severance payments and benefits listed in
                  paragraph 5(a) of this Agreement; provided, however, that the
                  amounts that the Executive would otherwise be entitled to
                  receive under this Agreement in the amount of or otherwise in
                  respect of the Executive's annual base salary will be reduced
                  by the amount of any disability payments received by the
                  Executive that have been funded or insured wholly or in part
                  at the expense of the Company or any affiliate of the Company.

         (d)      Effect of Death. In the event of the Executive's death during
                  the Salary Continuation Period or the CIC Salary Continuation
                  Period, the severance payments and benefits listed in
                  paragraphs 5(a) or 5(b) of this Agreement, as applicable, will
                  be paid to the Executive's Beneficiary for remainder of the
                  Salary Continuation Period or the CIC Salary Continuation
                  Period, as the case may be.

         (e)      "Basic Earnings" Under Retirement Plans. Any and all amounts
                  paid under this Agreement in the amount of or otherwise in
                  respect of the Executive's annual base salary and bonuses,
                  whether or not deferred under a deferred compensation plan or
                  program, are intended to be and will be "Basic Earnings" for
                  purposes of determining Basic Earnings under any and all
                  retirement plans sponsored or maintained by the Company or by
                  any affiliate controlled by the Company.

6. Acceleration of Restricted Stock Awards Upon a Change in Control. Upon a
Change in Control, all conditions, contingencies and other restrictions will be
removed from the full number of shares of stock subject to any and all
performance stock and other restricted stock grants, if any, that have been
awarded to the Executive under any and all stock plans of the Company, and said
full number of shares will immediately vest and be issued and delivered to the
Executive free of any and all conditions, contingencies and other restrictions.

7. Effect of Retirement or Attainment of Age 65. In the event the Executive or
the Executive's spouse begins to receive a benefit under one or more retirement
plans sponsored or maintained by the Company or by any affiliate of the Company
before the Executive becomes or would have become eligible for Normal Retirement
under any such plan at age 65, the amounts that the Executive or the Executive's
spouse would otherwise be entitled to receive under this Agreement in the amount
of or otherwise in respect of the Executive's annual base salary will be reduced
by the amount of any payments received by the Executive or the Executive's
spouse under such plan or plans. Furthermore, in no event will the severance
payments or benefits provided for under this Agreement be paid or otherwise
provided to the Executive, the Executive's spouse, or the Beneficiary beyond the
date the Executive becomes or would have become eligible for normal retirement
at age 65 under one or more of the retirement plans sponsored or maintained by
the Company or any affiliate of the Company.

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8. Mitigation of Damages. The Executive will not be required to mitigate damages
or the amount of any payment provided for under this Agreement by seeking other
employment or otherwise. Except as otherwise specifically provided in this
Agreement, the amount of any payment provided for under this Agreement will not
be reduced by any compensation earned by the Executive as the result of
self-employment or employment by another employer or otherwise.

9. Tax Effect.

         (a)      If the Company's independent accounting firm determines that
                  any payment or distribution by the Company or its affiliates
                  to or for the benefit of the Executive (whether paid or
                  payable or distributed or distributable pursuant to the terms
                  of this Agreement or otherwise, and whether paid or payable or
                  distributed or distributable in cash, stock or any other form)
                  (a "Payment") constitutes a "parachute payment" as defined in
                  Section 280G of the Internal Revenue Code of 1986, as amended
                  (the "Code") (or any successor provision thereto) ("Parachute
                  Payment") which would be subject to the excise tax imposed by
                  Section 4999 of the Code, or any interest or penalties are
                  incurred by the Executive with respect to such excise tax
                  (such excise tax, together with any such interest and
                  penalties, are hereinafter collectively referred to as the
                  "Basic Excise Tax"), then the Executive will be entitled to
                  receive an additional payment (a "Gross-Up Payment") in an
                  amount which is sufficient to cover any and all federal, state
                  and local income taxes and Medicare tax applicable to the
                  Gross-Up Payment, including, without limitation, any further
                  excise tax imposed by Section 4999 of the Code on or with
                  respect to the Gross-Up Payment, plus payment of the Basic
                  Excise Tax.

         (b)      Subject to the provisions of paragraph 9(d) below, all
                  determinations required to be made under this paragraph 9,
                  including whether and when a Gross-Up Payment is required, the
                  amount of such Gross-Up Payment and the assumptions to be
                  utilized in arriving at such determinations, will be made by
                  the Company's independent accounting firm, which will provide
                  detailed supporting calculations both to the Company and the
                  Executive within 15 business days of the receipt of notice
                  from the Executive that there has been a Payment, or such
                  earlier time as is requested by the Company. All fees and
                  disbursements of the Company's independent accounting firm
                  will be paid by the Company.

         (c)      Any Gross-Up Payment will be paid by the Company to the
                  Executive within five days of the Company's receipt of the
                  determination of the Company's independent accounting firm. If
                  such firm determines that no Basic Excise Tax is payable by
                  the Executive, it will furnish the Executive with a written
                  opinion that the Executive has substantial authority not to
                  report any Basic Excise Tax on the Executive's Federal income
                  tax return.

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                  If the Executive is subsequently required to make a payment of
                  any Basic Excise Tax, then the Company's independent
                  accounting firm will determine the amount of the corresponding
                  Gross-Up Payment, and any such Gross-Up Payment will be
                  promptly paid by the Company to or for the benefit of the
                  Executive. The fees and disbursements of the Company's
                  independent accounting firm will be paid by the Company.

         (d)      The Executive will notify the Company in writing within 15
                  days of any claim by the Internal Revenue Service that, if
                  successful, would require the payment by the Company of a
                  Gross-Up Payment. If the Company notifies the Executive in
                  writing that it desires to contest such claim and that it will
                  bear the costs and provide the indemnification as required by
                  this paragraph, the Executive will:

                  (i)      give the Company any information reasonably requested
                           by the Company relating to such claim,

                  (ii)     take such action in connection with contesting such
                           claim as the Company reasonably requests in writing
                           from time to time, including, without limitation,
                           accepting legal representation with respect to such
                           claim by an attorney reasonably selected by the
                           Company,

                  (iii)    cooperate with the Company in good faith in order to
                           effectively contest such claim, and

                  (iv)     permit the Company to participate in any proceedings
                           relating to such claim; provided, however, that the
                           Company will bear and pay directly all costs and
                           expenses (including additional interest and
                           penalties) incurred in connection with such contest
                           and will indemnify and hold the Executive harmless,
                           on an after-tax basis, for any Basic Excise Tax or
                           income tax, including interest and penalties with
                           respect thereto, imposed as a result of such
                           representation and payment of costs and expenses. The
                           Company will control all proceedings taken in
                           connection with such contest; provided, however, that
                           if the Company directs the Executive to pay such
                           claim and sue for a refund, the Company will advance
                           the amount of such payment to the Executive, on an
                           interest-free basis, and will indemnify and hold the
                           Executive harmless, on an after-tax basis, from any
                           Basic Excise Tax or income tax, including interest or
                           penalties with respect thereto, imposed with respect
                           to such advance or with respect to any imputed income
                           with respect to such advance.

                                      -12-
<PAGE>
         (e)      If, after the receipt by the Executive of an amount advanced
                  by the Company pursuant to paragraph 9(d)(iv), the Executive
                  becomes entitled to receive any refund with respect to such
                  claim, the Executive will, within 10 days of receipt thereof,
                  pay to the Company the amount of such refund, together with
                  any interest paid or credited thereon after taxes applicable
                  thereto. If, after the receipt by the Executive of an amount
                  advanced by the Company pursuant to paragraph 9(d)(iv), a
                  determination is made that the Executive will not be entitled
                  to any refund with respect to such claim and the Company does
                  not notify the Executive in writing of its intent to contest
                  such denial of refund prior to the expiration of 30 days after
                  such determination, then such advance will be forgiven and
                  will not be required to be repaid and the amount of such
                  advance will offset, to the extent thereof, the amount of
                  Gross-Up Payment required to be paid.

10. Confidential Information; Non-solicitation. During all periods while the
Executive is an employee of the Company or any of its affiliates and during any
Salary Continuation Period or CIC Salary Continuation Period, the Executive
covenants and agrees as follows:

         (a)      to hold in a fiduciary capacity for the benefit of the Company
                  and its affiliates all secret, proprietary or confidential
                  material, knowledge, data or any other information relating to
                  the Company or any of its affiliated companies and their
                  respective businesses ("Confidential Information"), which has
                  been obtained by the Executive during the Executive's
                  employment by the Company or any of its affiliated companies
                  and that has not been, is not now and hereafter does not
                  become public knowledge (other than by acts by the Executive
                  or representatives of the Executive in violation of this
                  Agreement), and will not, without the prior written consent of
                  the Company or as may otherwise be required by law or legal
                  process, communicate or divulge any such information,
                  knowledge or data to anyone other than the Company and those
                  designated by it; the Executive further agrees to return to
                  the Company any and all records and documents (and all copies
                  thereof) and all other property belonging to the Company or
                  relating to the Company, its affiliates or their businesses,
                  upon termination of Executive's employment with the Company
                  and its affiliates; and,

         (b)      not to solicit or entice any other employee of the Company or
                  its affiliates to leave the Company or its affiliates to go to
                  work for any other business or organization which is in direct
                  or indirect competition with the Company or any of its
                  affiliates, nor request or advise a customer or client of the
                  Company or its affiliates to curtail or cancel such customer's
                  business relationship with the Company or its affiliates.

                                      -13-
<PAGE>
11. Rights and Remedies Upon Breach. If the Executive breaches, or threatens to
commit a breach of, any of the provisions contained in paragraph 10 of this
Agreement (the "Restrictive Covenants"), the Company will have the following
rights and remedies, each of which rights and remedies will be independent of
the others and severally enforceable, and each of which is in addition to, and
not in lieu of, any other rights and remedies available to the Company under law
or in equity:

         (a)      Specific Performance. The right and remedy to have the
                  Restrictive Covenants specifically enforced by any court of
                  competent jurisdiction, it being agreed that any breach or
                  threatened breach of the Restrictive Covenants would cause
                  irreparable injury to the Company and that money damages would
                  not provide an adequate remedy to the Company.

         (b)      Accounting. The right and remedy to require the Executive to
                  account for and pay over to the Company all compensation,
                  profits, monies, accruals, increments or other benefits
                  derived or received by the Executive as the result of any
                  action constituting a breach of the Restrictive Covenants.

         (c)      Cessation of Severance Benefits. The right and remedy to cease
                  any further severance, benefit or other compensation payments
                  under this Agreement to the Executive or the Beneficiary from
                  and after the commencement of such breach by the Executive.

The Executive hereby acknowledges and agrees that the Restrictive Covenants are
reasonable and valid in duration and in all other respects. If any court
determines that any of the Restrictive Covenants, or any part thereof, is
invalid or unenforceable, the remainder of the Restrictive Covenants will not
thereby be affected and will be given full effect without regard to the invalid
portions.

12. Notices. Any notice provided for in this Agreement will be given in writing
and will be delivered personally, telegraphed, telexed, sent by facsimile
transmission or sent by certified, registered or express mail, postage prepaid.
Any such notice will be deemed given when so delivered personally, telegraphed,
telexed or sent by facsimile transmission, or, if mailed, on the date of actual
receipt thereof. Notices will be properly addressed to the parties at their
respective addresses set forth below or to such other address as either party
may later specify by notice to the other in accordance with the provisions of
this paragraph:

         If to the Company:

         GlobalSantaFe Corporation
         15375 Memorial Drive
         Houston, Texas 77079-4101
         Attention: General Counsel

                                      -14-
<PAGE>
         If to the Executive:

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

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

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

13. Entire Agreement. This Agreement contains the entire agreement between the
parties with respect to the subject matter hereof and supersedes all prior
agreements, written or oral, with respect thereto, including, without
limitation, any and all prior employment or severance agreements and related
amendments entered into between the Company and the Executive. Furthermore, the
severance payments and benefits provided for under this Agreement are separate
and apart from and, to the extent they are actually paid, will be in lieu of any
payment under any plan or policy of the Company or any of its affiliates
regarding severance payments generally.

14. Waivers and Amendments. This Agreement may be amended, superseded, canceled,
renewed or extended, and the terms and conditions hereof may be waived, only by
a written instrument signed by the parties hereto or, in the case of a waiver,
by the party waiving compliance. No delay on the part of any party in exercising
any right, power or privilege hereunder will operate as a waiver thereof, nor
will any waiver on the part of any party of any such right, power or privilege
hereunder, nor any single or partial exercise of any right, power or privilege
hereunder, preclude any other or further exercise thereof or the exercise of any
other right, power or privilege hereunder.

15. Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the state of Texas (without giving effect to the
choice of law provisions thereof), where the employment of the Executive will be
deemed, in part, to be performed, and enforcement of this Agreement or any
action taken or held with respect to this Agreement will be taken in the courts
of appropriate jurisdiction in Houston, Texas.

16. Assignment. This Agreement, and any rights and obligations hereunder, may
not be assigned by the Executive and may be assigned by the Company only to any
successor in interest, whether by merger, consolidation, acquisition or the
like, or to purchasers of substantially all of the assets of the Company.

17. Binding Agreement. This Agreement will inure to the benefit of and be
binding upon the Company and its respective successors and assigns and the
Executive and the Executive's legal representatives.

18. Counterparts. This Agreement may be executed in separate counterparts, each
of which when so executed and delivered will be deemed an original, but all of
which together will constitute one and the same instrument.

                                      -15-
<PAGE>
19. Headings. The headings in this Agreement are for reference purposes only and
will not in any way affect the meaning or interpretation of this Agreement.

20. Authorization. The Company represents and warrants that the Board of
Directors of the Company has authorized the execution of this Agreement.

21. Validity. The invalidity or unenforceability of any provisions of this
Agreement will not affect the validity or enforceability of any other provisions
of this Agreement, which will remain in full force and effect.

22. Tax Withholding. The Company will have the right to deduct from all benefits
and/or payments made under this Agreement to the Executive any and all taxes
required by law to be paid or withheld with respect to such benefits or
payments.

23. No Contract of Employment. Nothing contained in this Agreement will be
construed as a contract of employment between the Company or any of its
affiliates and the Executive, as a right of the Executive to be continued in the
employment of the Company or any of its affiliates, or as a limitation of the
right of the Company or any of its affiliates to discharge the Executive with or
without cause.

         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

The Company                                  The Executive
GLOBALSANTAFE CORPORATION

                                             -----------------------------------
By:                                            [Name]
    -------------------------------
      [Name]
      [Title]

                                      -16-<PAGE>
                                                                   EXHIBIT 10.1

                            ASSET PURCHASE AGREEMENT

                                  BY AND AMONG

                               CASA OLE EAST, LTD.
                                    AS BUYER,

                                       AND

                           MEXICAN RESTAURANTS, INC.,
                                  AS GUARANTOR,

                           CASA OLE OF BEAUMONT, INC.,
                         CASA OLE OF LAKE CHARLES, INC.,
                        HARKEN REAL ESTATE COMPANY, INC.,
                    CRAZY JOSE'S RESTAURANT GROUP, INC., AND
                         CRAZY JOSE'S FRANCHISING, INC.,
                                   AS SELLER,

                                       AND

                         THOMAS L. AND MELBA HARKEN AND
                         VICTOR M. AND DOLORES GONZALEZ,
                                 AS SHAREHOLDERS

                               SEPTEMBER 25, 2003

<PAGE>

                                Table of Contents

<Table>
<Caption>
                                                                                                                 Page
<S>      <C>                                                                                                     <C>
ARTICLE 1 BASIC TRANSACTION.......................................................................................1
1.1      Definitions..............................................................................................1
1.2      Purchase and Sale of Restaurant Assets...................................................................2
         1.2.1    Owned Real Property.............................................................................2
         1.2.2    Fixtures and Improvements.......................................................................2
         1.2.3    Equipment.......................................................................................2
         1.2.4    Licenses and Permits............................................................................2
         1.2.5    Restaurant Intellectual Property................................................................2
         1.2.6    Goodwill........................................................................................2
         1.2.7    Contracts.......................................................................................2
         1.2.8    Inventories.....................................................................................2
         1.2.9    Leases..........................................................................................2
         1.2.10   Claims, Rights, Etc.............................................................................2
         1.2.11   Computers.......................................................................................3
         1.2.12   Personal Goodwill; Characters...................................................................3
         1.2.13   Other Tangibles.................................................................................4
         1.2.14   Acknowledgement of Franchisor Interests.........................................................4

1.3      Purchase Price...........................................................................................4
         1.3.1    Seller Allocation...............................................................................4
         1.3.2    Note Allocation.................................................................................4
         1.3.3    Adjustment for Cash.............................................................................4
1.4      Assumption of Liabilities................................................................................5
1.5      Prorations 1.3.1.........................................................................................5
1.6      Purchase Price Allocation................................................................................6
1.7      Royalty Interests........................................................................................6

ARTICLE 2 CLOSING; TERMINATION....................................................................................6
2.1      Closing Date.............................................................................................6
2.2      Deliveries at the Closing................................................................................6
2.3      Conditions to Buyer's Obligations to Close...............................................................7
2.4      Conditions to Seller's Obligations to Close.............................................................11
2.5      Termination.............................................................................................13
2.6      Effect of Termination...................................................................................14

ARTICLE 3 REPRESENTATIONS AND WARRANTIES.........................................................................14
3.1      Representations and Warranties of Seller and Shareholders...............................................14
         3.1.1    Organization...................................................................................14
         3.1.2    Authority Relative to This Agreement; Non-Contravention........................................15
         3.1.3    Financial Statements...........................................................................16
         3.1.4    Absence of Certain Changes.....................................................................16
         3.1.5    Litigation.....................................................................................16
         3.1.6    Broker's or Finder's Fees......................................................................16
         3.1.7    Subsidiaries...................................................................................17
         3.1.8    Benefit Plans..................................................................................17
</Table>

                                       i
<PAGE>

<Table>
<S>      <C>                                                                                                     <C>
         3.1.9    Compliance with Laws...........................................................................17
         3.1.10   Contracts; Debt Instruments....................................................................17
         3.1.11   Properties.....................................................................................18
         3.1.12   Intellectual Property..........................................................................18
         3.1.13   Certain Employee Matters.......................................................................19
         3.1.14   Insurance......................................................................................19
         3.1.15   Taxes..........................................................................................20
         3.1.16   Promotions.....................................................................................20
         3.1.17   Inventory......................................................................................20
         3.1.18   Permits........................................................................................20
         3.1.19   Disclosure.....................................................................................20
3.2      Representations and Warranties of the Buyer and Guarantor...............................................20
         3.2.1    Organization and Qualification of the Buyer and Guarantor......................................20
         3.2.2    Authorization of Transaction...................................................................21
         3.2.3    Noncontravention...............................................................................21
         3.2.4    Continuity of Business.........................................................................21
         3.2.5    SEC Filings....................................................................................22

ARTICLE 4 PRE-CLOSING COVENANTS..................................................................................22
4.1      General...............................................................................................  22
4.2      Notices and Consents....................................................................................22
4.3      Full Access.............................................................................................23
4.4      Confidentiality.........................................................................................23
         4.4.1    Confidential Information.......................................................................23
         4.4.2    Press Releases and Announcements...............................................................24
4.5      Communication with Seller's Employees...................................................................24
4.6      Removal of Excluded Assets..............................................................................24
4.7      Risk of Loss............................................................................................24
4.8      Delivery of Information to Buyer........................................................................24
4.9      Delivery of Information by Seller.......................................................................25
4.10     Title...................................................................................................26
4.11     No Shop.................................................................................................27

ARTICLE 5 POST-CLOSING COVENANTS.................................................................................27
5.1      General.................................................................................................27
5.2      Covenant Not to Compete and Confidentiality.............................................................27
         5.2.1    Restrictive Covenants..........................................................................28
         5.2.2    Definitions....................................................................................28
         5.2.3    General........................................................................................29
         5.2.4    Ancillary to Enforceable Agreements............................................................29
         5.2.5    Non-Competition................................................................................29
         5.2.6    Solicitation of Customers......................................................................29
         5.2.7    Solicitation of Transactions...................................................................29
         5.2.8    Reformation....................................................................................29
         5.2.9    Approved Transactions..........................................................................30
         5.2.10   Survival.......................................................................................30
         5.2.11   Remedies.......................................................................................30
</Table>

                                       ii
<PAGE>

<Table>
<S>      <C>                                                                                                     <C>
         5.2.12   Miscellaneous..................................................................................30
         5.2.13   Confidentiality of Information.................................................................30
         5.2.14   Enforcement....................................................................................31
         5.2.15   Notice and Cure................................................................................32
         5.2.16   Miscellaneous..................................................................................32
5.3      Employees...............................................................................................32
5.4      Litigation Support......................................................................................32
5.5      Texas Certificate of No Tax Due.........................................................................33
5.6      Amendment to Articles of Incorporation; Change of Name .................................................33

ARTICLE 6 REMEDIES FOR BREACH OF AGREEMENT.......................................................................33
6.1      Indemnification Provisions for Benefit of the Buyer.....................................................33
6.2      Indemnification Provisions for Benefit of the Seller and Shareholders...................................33
6.3      Procedures for Matters Involving Third Parties..........................................................34
6.4      Limitation of Representations and Warranties............................................................35
         6.4.1    Condition of the Business and Property.........................................................35
         6.4.2    Limitation.....................................................................................36
6.5      Threshold...............................................................................................36
6.6      Limitation on Liability.................................................................................36
6.7      Miscellaneous...........................................................................................36
6.8      Survival................................................................................................37

ARTICLE 7 MISCELLANEOUS..........................................................................................37
7.1      Entire Agreement........................................................................................37
7.2      No Third-Party Beneficiaries............................................................................37
7.3      Succession and Assignment...............................................................................37
7.4      Notices.................................................................................................37
7.5      Amendments and Waivers..................................................................................38
7.6      Severability............................................................................................38
7.7      Construction............................................................................................39
7.8      Independent Obligations.................................................................................39
7.9      Expenses................................................................................................39
7.10     Headings................................................................................................39
7.11     Time....................................................................................................39
7.12     Legal Representation....................................................................................39
7.13     Counterparts............................................................................................40
7.14     Facsimile Signatures....................................................................................40
7.15     Governing Law...........................................................................................40
7.16     Dispute Resolution......................................................................................40
7.17     Survival of Representations, Warranties and Covenants...................................................41
7.18     Solicitation of Employees...............................................................................41
</Table>

                                      iii

<PAGE>

                            ASSET PURCHASE AGREEMENT

         This Asset Purchase Agreement (this "Agreement") is made and entered
into effective as of, September 25, 2003 (the "Effective Date") by and among
Casa Ole East, Ltd., a Texas limited partnership (the "Buyer"), and Mexican
Restaurants, Inc. (the "Guarantor"), and Casa Ole of Beaumont, Inc., Casa Ole of
Lake Charles, Inc., Harken Real Estate Company, Inc., Crazy Jose's Restaurant
Group, Inc., and Crazy Jose's Franchising, Inc., each a Texas corporation
(collectively, the "Seller"), and Melba and Thomas L. Harken, individually, and
Victor M. and Dolores Gonzalez, individually (collectively, the "Shareholders").

                                    RECITALS

         A. The Seller is engaged in the business of operating Casa Ole and
Crazy Jose restaurants at various locations in Texas and Louisiana (the
"Restaurants"). The Casa Ole Restaurants are each operated under a Protected
Location Franchise Agreement with Casa Ole Franchise Services, Inc. or any
successor(s) thereto (the "Franchisor"). Certain Seller owned and certain Seller
leased real property and improvements that are used in connection with the
Restaurant Business (collectively, such owned interests are referred to as the
"Owned Real Property" and such leasehold interests are referred to as the
"Leased Real Property", and collectively, such Owned Real Property and Leased
Real Property are referred to as the "Real Property").

         B. This Agreement contemplates a transaction pursuant to which (i) the
Buyer will purchase all or substantially all of the assets (including goodwill)
associated with the Restaurants from the Seller in return for cash (and the
assumption of certain liabilities, including but not limited to the leases of
Leased Real Property) and Notes, (ii) the Buyer will purchase the Owned Real
Property from the Seller that is the owner of such Real Property in return for
cash and Notes, and (iii) Buyer will purchase certain personal goodwill from the
Shareholders in return for cash and promissory notes.

         NOW THEREFORE, in consideration of the Recitals, and the mutual
benefits to be derived hereunder, the receipt and sufficiency of which are
hereby acknowledged, the Parties agree as follows:

                                   ARTICLE 1
                                BASIC TRANSACTION

         1.1 DEFINITIONS. Unless otherwise stated in this Agreement, capitalized
terms used in this Agreement shall have the meaning set forth in Exhibit 1.1
attached to this Agreement. Unless the context shall require otherwise: (a)
words importing the singular number or plural number shall include the plural
number and singular number respectively; (b) words importing the masculine
gender shall include the feminine and neuter genders and vice versa; (c)
reference to "include," "includes," and "including" shall be deemed to be
followed by the phrase "without limitation"; (d) reference in this Agreement to
"herein," "hereby" or "hereunder," or any similar formulation, shall be deemed
to refer to this Agreement as a whole, including all Exhibits and Schedules to
this Agreement; (e) reference to "and" and "or" shall be deemed to mean
"and/or"; (f) references to Articles and Sections refer to Articles and Sections
of this Agreement; and (g) references to Exhibits and Schedules are to the
Exhibits and Schedules attached to this Agreement, each of which is made a part
hereof for all purposes.

                                       1
<PAGE>

         1.2 PURCHASE AND SALE OF RESTAURANT ASSETS. On and subject to the terms
and conditions of this Agreement, and in consideration of the delivery of the
Purchase Price to Seller and Shareholders and the assumption of the Assumed
Liabilities by Buyer, the Seller agrees to sell, assign, transfer, convey, and
deliver to the Buyer, and the Buyer agrees to purchase and acquire from the
Seller, at the Closing, all of the Restaurant Assets free and clear of all
liens, claims, and encumbrances, subject to Permitted Encumbrances. For purposes
hereof, the term "Restaurant Assets" means all assets and property rights of any
kind or character, wherever located, whether tangible or intangible (including
goodwill), whether or not reflected on the Seller's books or records, currently
used by the Seller in connection with the Restaurant Business, as further
described in the following clauses 1.2.1 through 1.2.13, as they exist on the
Closing Date; provided, however, that the Restaurant Assets shall not include
the excluded assets listed on Exhibit 1.2 ("Excluded Assets"):

                  1.2.1 "OWNED REAL PROPERTY" shall mean the parcels of Owned
         Real Property described by metes and bounds or other legal description,
         including the Restaurant sites and adjacent properties, as set forth in
         Exhibit 1.2.1;

                  1.2.2 "FIXTURES AND IMPROVEMENTS" shall mean all Fixtures and
         Improvements owned by Seller and located on the Real Property;

                  1.2.3 "EQUIPMENT" shall mean all Equipment owned by Seller and
         located on the Real Property;

                  1.2.4 "LICENSES AND PERMITS" shall mean all right, title and
         interest of Seller in, to and under all Licenses and Permits relating
         to the Restaurant Business or to all or any of the Restaurant Assets,
         but only to the extent such Licenses and Permits are transferable under
         applicable law. Seller and Buyer understand that Seller's liquor, beer
         and wine permits are not transferable, and nothing in this Agreement
         shall obligate Seller to permit Buyer to operate after Closing under
         such permits and Buyer agrees it will not attempt to do so;

                  1.2.5 "RESTAURANT INTELLECTUAL PROPERTY" shall mean all of
         Seller's and the Shareholders' right, title and interest in and to
         Restaurant Intellectual Property;

                  1.2.6 "GOODWILL" shall mean all of Seller's and the
         Shareholders' right, title and interest in and to the goodwill of the
         Restaurant Business;

                  1.2.7 "CONTRACTS" shall mean all right, title and interest of
         Seller in, to and under the Contracts, and all rights (including rights
         of refund and offset), privileges, deposits, claims, causes of action
         and options relating or pertaining to the Contracts;

                  1.2.8 "INVENTORIES" shall mean all Inventories of Seller and
         of the Big Thicket Social Club;

                  1.2.9 "LEASES" shall mean Seller's leasehold estate as tenant
         under the Leases of the Leased Real Property ("Leased Real Property")
         listed in Exhibit 1.2.9;

                  1.2.10 "CLAIMS, RIGHTS, ETC." shall mean all rights to
         insurance claims for property damage, prior to closing, to the
         Restaurant Assets under Seller's property casualty insurance in effect
         prior to closing, if, and to the extent assignable and/or

                                       2

<PAGE>

         transferable, the benefit of and the right to enforce the covenants and
         warranties, if any, that Seller is entitled to enforce with respect to
         the Restaurant Assets against Seller's predecessors in title to the
         Restaurant Assets. This clause does not apply to Excluded Assets.

                  1.2.11 COMPUTERS. All right, title and interest of Seller in
         computer equipment and hardware, including, without limitation, all
         cash registers, all central processing units, terminals, disk drives,
         tape drives, electronic memory units, printers, keyboards, screens,
         peripherals (and other input/output devices), modems and other
         communication controllers, and any and all parts and appurtenances
         thereto, together with all right, title and interest of Seller in all
         Intellectual Property used by the Seller in the operation of such
         computer equipment and hardware, including, without limitation, all
         software, all of Seller's rights under any licenses related to the
         Seller's use, at any time, of such computer equipment, hardware or
         software, and all leases pursuant to which Seller leases any computer
         equipment, hardware or software; insofar and only insofar as any of the
         foregoing are used in a Restaurant or otherwise in connection with the
         Restaurant Business;

                  1.2.12 PERSONAL GOODWILL; CHARACTERS. All right, title and
         interest of Seller and the Shareholders in and to, including the use
         and portrayal of, all characters previously used to promote the
         Restaurant Business, including all scripts, names, tapes, videos,
         sketches, including the names and concepts "Poppee," "Crazy Jose's",
         "Grandson", (Seller to deliver, at Closing, a letter of consent from
         the applicable Shareholders' family members (grandchildren) to the
         Intellectual Property transfers contemplated in this Agreement) "Snap
         of the Finger Magic", "Gatorman", "Whiporito", "Caricatures (on
         restaurant walls or in commercial advertisements)" and all similar such
         commercial advertisements, together with all goodwill associated
         therewith (collectively the "Character"). Each Seller and each
         Shareholder specifically acknowledge and agree that this Section 1.2.12
         specifically contemplates the sale to Buyer of the "Poppee" character
         (Thomas L. Harken) and all mannerisms and other identifying
         characteristics related to the Character and all goodwill associated
         therewith, and that from and after the Closing, neither the Seller nor
         the Shareholders shall have any right to use such Character, whether in
         promoting a business or otherwise. Personal goodwill shall not include
         the personal goodwill of the children or grandchildren of Thomas L.
         Harken or Victor M. Gonzalez, nor rights to the use of the names of
         Thomas L. or Melba Harken or such children or grandchildren, except
         that Buyer shall be entitled to use and at Closing shall be conveyed
         the use of all existing advertisements related to the Restaurant
         Business which have such persons, children or grandchildren or such
         names in them, for a period of two (2) years after Closing. Nothing in
         this Agreement shall obligate such children or grandchildren or Thomas
         L. Harken or Victor M. Gonzalez to perform any service for or to agree
         to any additional use of their images beyond that which is specifically
         contemplated herein, or to restrict or to limit in any way their future
         activities or the use by them or their licensees of their names and
         images in any endeavor of any kind or type except as expressly provided
         in Section 5.2 as to Thomas L. and Melba Harken. Seller shall retain
         and Buyer shall not be entitled to use the name "Harken Real Estate
         Company" or any derivatives thereof; and

                                       3
<PAGE>

                  1.2.13 OTHER TANGIBLES. All right, title and interest of
         Seller in, to and under all rights, privileges, claims, causes of
         action, and options relating or pertaining to the foregoing Restaurant
         Assets.

                  1.2.14 ACKNOWLEDGEMENT OF FRANCHISOR INTERESTS. As elsewhere
         stated, the parties acknowledge and agree that Seller's assets being
         sold under this Agreement are assets used in connection with, both,
         franchised and licensed (Casa Ole) and non-franchise owned restaurant
         businesses. The parties agree that nothing in this Agreement is
         intended to assert claim, right or title to any of the Marks or
         proprietary System or the goodwill associated with the Marks or System
         of the Franchisor, Casa Ole Franchise Services, Inc. as set forth in
         the Casa Ole Franchise Agreements and that any reference in this
         Agreement to the assets of Seller specifically exclude any and all
         assets of the Franchisor.

         1.3 PURCHASE PRICE. As full and complete consideration for the sale and
transfer of the Restaurant Assets to the Buyer, the noncompetition covenants of
the Shareholders contained herein, and the sale and transfer of the personal
goodwill of the Shareholders to the Buyer, the Buyer shall pay and deliver to
the Seller and the Shareholders at the Closing the aggregate amount of
$13,750,000, which amount shall be allocated in accordance with Section 1.6 and
shall be payable at Closing in the following manner:

                  1.3.1 SELLER ALLOCATION. The portion of the Purchase Price
         allocated to Seller shall be payable to Seller all in cash
         ($10,750,000.00) at Closing by wire transfer or delivery of other
         immediately available funds.

                  1.3.2 NOTE ALLOCATION. The Three Million Dollars
         ($3,000,000.00) portion of the Purchase Price allocated to the
         Shareholders shall be paid at Closing in the form of Promissory Notes
         ("Notes") executed by Buyer. The forms, principal and interest amounts,
         payees and amortization of the Notes shall be as set forth on Exhibit
         1.6 A. with note forms 1.3.2 A, B, C, D and E are attached. Guarantor
         agrees to execute and deliver a guaranty of such Notes in the form set
         forth in Exhibit 1.6 B. If requested to do so, the Shareholders shall
         agree in writing to subordinate payment obligations under the Notes to
         obligations to Buyer's lenders under such terms as Buyer, Shareholders
         and Buyer's lender shall reasonably agree; provided that in no event
         shall the obligations under the Notes be required to be subordinated to
         obligations exceeding $10,000,000.00 plus interest and collection
         costs. Buyer and Guarantor understand and agree that the Notes are
         negotiable, and without limitation may be distributed or assigned by
         the initial entity payees to owner(s) of the entity.

                  1.3.3 ADJUSTMENT FOR CASH. The Purchase Price shall be
         increased on a dollar-for-dollar basis in respect of (i) all cash and
         cash equivalents physically present in the Restaurants on the Closing
         Date, and (ii) all deposits and pre-paid items that relate to Assumed
         Liabilities (such as security deposits for the Leases) or the
         Restaurant Assets that are transferred to Buyer hereunder. The deposits
         owned by Seller are set forth on Schedule 1.3.3 attached hereto. Seller
         shall report the amounts of such items on per-Restaurant basis and
         Seller and Shareholders shall certify such report to Buyer at Closing.
         The adjustment for such items shall be paid in cash to Seller within
         sixty (60) days after Seller reports the amounts of such items to
         Buyer. The Purchase Price shall be decreased by any outstanding gift
         certificates and catering credits sold by Seller prior to Closing, to
         the extent not redeemed by the purchasers of same, prior to Closing. At
         Closing, Seller

                                       4
<PAGE>

         shall certify, to Seller's best information and belief, to Buyer the
         cash equivalent amount of such unredeemed gift certificates and
         catering credits, which amount shall be applied as a credit to Buyer on
         the sooner of (i) when verified or (ii) at the final adjustment within
         sixty (60) days of Closing.

         1.4 ASSUMPTION OF LIABILITIES. On and subject to the terms and
conditions of this Agreement, the Buyer agrees to assume and become responsible
for all of the Assumed Liabilities (as listed on Exhibit 1.4) at the Closing.
The Guarantor agrees to guarantee such assumption and to execute and deliver at
closing the guaranty thereof in the form set forth in Exhibit 1.6 B. The Buyer
will not assume or have any responsibility, however, with respect to any other
obligation or liability of the Seller not included within the definition of
Assumed Liabilities, including all Excluded Liabilities. The Guarantor agrees to
execute and deliver direct guaranties of the Assumed Liabilities to the Lessors
and other parties to such Assumed Liabilities as may be reasonably required by
such Lessors and other parties to comply with the conditions for assignment and
assumption thereof and as may be reasonably required to obtain reasonable
consents to the assignments and assumptions and releases of Seller and
Shareholders.

         1.5 PRORATIONS.

         (a) Seller shall be responsible for and shall pay all personal property
taxes, ad valorem taxes and assessments which are past due or have become due
with respect to any of the Restaurant Assets or the Real Property on or before
the Closing Date, together with any penalty or interest thereon. The Seller and
Buyer shall cause to be prorated through the Closing Date all (i) applicable
personal property taxes and ad valorem taxes arising with respect to the
Restaurant Assets or the Real Property for the current assessment period and
(ii) accrued vacation attributable to Seller's employees (and hired by Buyer)
and not yet due or paid as of the Closing Date. Seller shall, at Closing, pay
Buyer an amount equal to the Seller's prorated portion of such taxes and/or
accrued vacation, and Buyer thereafter shall timely pay such amount to the
appropriate taxing authority or employee, respectively. If current tax bills are
not available as of the Closing Date, the prior year's tax bills will be used
for purposes of making a tentative proration at the Closing, and a final
proration shall be made promptly when the current tax bills are received. The
Seller shall (and the Shareholders shall cause Seller to) remit any additional
amounts due to Buyer within sixty (60) days of receipt of written notice thereof
from Buyer (which notice shall include reasonable evidence of the taxes owed and
a statement of the amount claimed of Seller). The Buyer shall remit to the
Seller any excess amounts previously paid by Seller (as well as reasonable
evidence of the taxes owed and a statement regarding the excess amounts)
promptly upon receiving the current year's tax bills and determining the amount
of such excess.

         (b) Except for insurance premiums on the policies being retained by
Seller, at the Closing, all normal and customarily prorated items, including
without limitation, maintenance fees and assessments, rent, prepaid Yellow Pages
advertisements and other prepaid obligations and, to the extent available at
Closing, utility services being continued to the Real Property, shall be
prorated as of the Closing Date. Seller (or the landlord under any leases, as
appropriate) shall be charged for and credited with all prorated items up to and
including the Closing Date and Buyer shall be charged for and credited with all
of same from and after the Closing Date.

                                       5
<PAGE>

         (c) Premiums for Seller's insurance will not be prorated since Buyer
will not assume the coverage maintained by Seller. Buyer hereby acknowledges
that Buyer will be solely responsible for obtaining Buyer's own insurance
coverage.

         (d) If Buyer desires to have existing utility services continued to the
Real Property after the Closing, Buyer shall use its reasonable efforts to make
arrangements for such continuation, including advising the provider of such
utility services of changes in billing name and address and paying security
deposits, if any, are required by the provider of such utility services. Buyer
shall be fully responsible and shall pay on time all utility charges after
Closing. If Buyer shall not have completed all changes in billing from Seller to
Buyer within fifteen (15) days after Closing, Seller may, after ten (10) days
notice and opportunity to cure to Buyer, take actions it deems appropriate to
absolve itself of further liability to the utility companies, including but not
limited to instructions to terminate services. Whether existing utility services
to the Real Property are continued or discontinued, all deposits held by the
providers of such utility services shall be paid to Seller.

         (e) The provisions of this Section 1.5 shall survive the Closing.

         (f) Buyer and Seller shall share, co-equally, all real property/title
company closing costs including, but not limited to, title insurance, surveys,
filing fees and document preparation.

         1.6 PURCHASE PRICE ALLOCATION. The Purchase Price (and all other
capitalizable costs) shall be allocated among (i) the Restaurant Assets
(including goodwill), (ii) the Covenant Not to Compete and (iii) the personal
goodwill in accordance with their relative fair market values as set forth on
Exhibit 1.6. Each of the Buyer, Seller and Shareholders agrees to use the
allocations set forth on Exhibit 1.6 for purposes of all tax returns or
statements filed with any taxing authority, including preparation of IRS Form
8594, and all financial accounting.

         1.7 ROYALTY INTERESTS. Seller's claims for royalties due from Buyer,
specifically including Thomas L. Harken's royalties received from Buyer on the
business operations in Lufkin and Nacogdoches, Texas, shall be terminated
effective with the Closing.

                                   ARTICLE 2
                              CLOSING; TERMINATION

         2.1 CLOSING DATE. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place at the offices of DiCecco, Fant and
Burman, L.L.P., located at 1900 West Loop South, Suite 1100, Houston, Texas
77027, commencing at 9:00 a.m. local time on or before December 19, 2003, or
such other location or time as the Parties may mutually determine (the "Closing
Date"). All actions taken at the Closing shall be deemed to have been taken
simultaneously at the time the last of any such actions is taken or completed,
except as the Parties otherwise mutually agree.

         2.2 DELIVERIES AT THE CLOSING. At the Closing:

                  (a) Seller and the Shareholders, as appropriate, will execute,
         acknowledge, and/or deliver (as appropriate) to the Buyer: (i) the
         various certificates, instruments, and documents referenced below in
         Section 2.3; (ii) evidence, satisfactory to the Buyer, that all
         consents, approvals and authorizations required for the consummation by
         the Seller of the transactions contemplated by

                                       6

<PAGE>

         this Agreement have been obtained; and (iii) assignments and other
         instruments of sale, transfer, and conveyance, including special
         warranty deeds conveying the Owned Real Property and Bills of Sale and
         Assignment assigning, conveying, and transferring the Buyer the Leased
         Real Property and other Restaurant Assets, all subject only to
         Permitted Encumbrances and in form and substance mutually agreed upon
         by Seller and Buyer.

                  (b) Buyer will execute, acknowledge, and/or deliver (as
         appropriate) to the Seller: (i) the various certificates, instruments,
         and documents referenced below in Section 2.4; (ii) the Purchase Price,
         pursuant to Section 1.3; (iii) an assumption of the Assumed
         Liabilities; and (iv) all such assignments, assumption agreements and
         other instruments of sale, transfer, and conveyance in form and
         substance mutually agreed upon by Seller and Buyer.

                  (c) As may be reasonably requested, Guarantor will execute and
         deliver to the Seller and Shareholders and others: (i) the various
         guaranties (other than the Guaranty in the form of Exhibit 1.6.B which
         has been agreed upon), certificates, instruments, and documents
         referred to in Sections 1.3, 1.4, and 2.4.

         2.3 CONDITIONS TO BUYER'S OBLIGATIONS TO CLOSE. The obligation of the
Buyer to consummate the transactions to be performed by it in connection with
the Closing is subject to satisfaction of the following conditions, any of which
Buyer may waive by execution of a writing so stating at or prior to the Closing:

                  (a) the representations and warranties set forth in Section
         3.1 below shall be true and correct in all material respects at and as
         of the Closing Date;

                  (b) the Seller shall have performed and complied with all of
         its covenants hereunder in all material respects through the Closing;

                  (c) the Seller shall provide evidence satisfactory to the
         Buyer that there have been obtained all consents, approvals and
         authorizations required for the consummation by the Seller of the
         transactions contemplated by this Agreement for transfer of the
         Restaurant Assets;

                  (d) no action, suit, or proceeding shall be pending before any
         court or quasi-judicial or administrative agency of any federal, state,
         local, or foreign jurisdiction or before any arbitrator wherein an
         unfavorable injunction, judgment, order, decree, ruling, or charge
         would (A) prevent consummation of any of the transactions contemplated
         by this Agreement, (B) cause any of the transactions contemplated by
         this Agreement to be rescinded following consummation, or (C) affect
         adversely the right of the Buyer to own the Restaurant Assets, and no
         such injunction, judgment, order, decree, ruling, or charge shall be in
         effect;

                  (e) the Seller and Shareholders shall have delivered to the
         Buyer a certificate dated as of the Closing Date and executed by the
         chief executive officer of the Seller and each Shareholder to the
         effect that each of the conditions specified above in Section
         2.3(a)-(d) is satisfied in all material respects;

                                       7
<PAGE>

                  (f) the Buyer shall have received all material authorizations,
         consents, and approvals of governments and governmental agencies
         necessary or appropriate in connection with consummating the
         transactions contemplated by this Agreement for transfer of the
         Restaurant Assets;

                  (g) the Buyer's due diligence investigation of the Seller as
         contemplated by Section 4.5 hereof shall have been completed to the
         satisfaction of Buyer no later than November 19, 2003 (the "Due
         Diligence Period");

                  (h) the Buyer shall have received the following in form and
         substance satisfactory to Buyer in Buyer's sole discretion with respect
         to each Equipment Lease:

                           (i) a written Assignment ("Assignment") of each
                           Equipment Lease; and

                           (ii) a written consent of the lessors of said
                           Equipment Lease approving same; provided however, in
                           the event that Seller is not able to secure said
                           consent prior to Closing and Buyer waives said
                           requirement, Seller shall transfer to Buyer all
                           equitable rights in said Equipment Lease.

                  (i) the Buyer shall have received the following in form and
         substance satisfactory to Buyer in Buyer's sole discretion with respect
         to each Lease:

                           (i) a written Assignment ("Assignment") of all
                           Leases, executed by the Tenant or Lessee thereof with
                           respect to each parcel of Leased Real Property;

                           (ii) a written consent of the Landlord or Lessor with
                           respect to the Assignment of Tenant's or Lessee's
                           leasehold interest with respect to each such Lease
                           Agreement;

                           (iii) an Estoppel Agreement ("Estoppel") executed by
                           Landlord or Lessor with respect to each Lease
                           Agreement;

                           (iv) in the event of the existence of any lien,
                           encumbrance, deed of trust or mortgage existing on or
                           with respect to any parcel of Leased Real Property, a
                           Non-Disturbance Agreement executed by such lien
                           holder, encumbrancer or mortgagee;

                           (v) evidence reasonably satisfactory to Buyer that
                           all Land and Improvements on each parcel of Leased
                           Real Property is in compliance with all applicable
                           zoning ordinances and other laws, rules and/or
                           regulations governing the use of each such property;

                           (vi) evidence reasonably satisfactory to Buyer that
                           each parcel of Leased Real Property is not in
                           violation of any law, rule regulation or code,
                           including without limitation all applicable
                           environmental and/or hazardous substances laws, and
                           all applicable building codes and ordinances,
                           together with any other applicable law, ordinance,
                           rule or regulation pertaining to or governing the
                           ownership, occupancy and/or use of such property;

                                       8
<PAGE>

                           (vii) Buyer shall have received copies of
                           Certificates of Occupancy with respect to all parcels
                           of Leased Real Property evidencing lawful occupancy
                           of each such parcel by Seller;

                           (viii)Buyer shall have received title commitments and
                           title exception documents from the Title Company
                           evidencing that there are no violations of deed
                           restrictions or other recorded documents with respect
                           to any such property and that there are no mortgages,
                           liens, encumbrances or other matters of record which
                           would, hinder or interfere with the current use
                           and/or occupancy of any parcel of Leased Real
                           Property which has not been satisfied to Buyer's sole
                           satisfaction at or prior to Closing;

                           (ix) Buyer shall have received a survey of each
                           parcel of Leased Real Property duly prepared or
                           updated to a date not more than 60 days prior to
                           Closing, together with a certificate executed by
                           Seller at Closing certifying to Buyer that there have
                           been no material changes with respect to the Land or
                           the Improvements upon the Land constituting each
                           parcel of Leased Real Property; and

                           (x) Buyer shall have received and approved all
                           Closing documents including without limitation all
                           deeds to the Owned Real Property, Assignments of
                           Leases with respect to the Leased Real Property and
                           any and all other documents, certificates,
                           resolutions and agreements which may be necessary or
                           appropriate to close and carry out the terms of the
                           transaction set forth in this Agreement.

                  (j) Mr. Gonzalez shall have entered into an employment
         agreement with the Buyer in the form of Exhibit 2.3(j);

                  (k) there shall not have been any material adverse change in
         the financial condition, business of the Restaurants, or in the
         condition of the Restaurant Assets;

                  (l) the Seller shall have delivered to the Buyer a Certificate
         of Good Standing for each entity comprising the Seller issued by the
         State of Texas no more than thirty (30) days prior to Closing;

                  (m) all necessary director and shareholder resolutions,
         waivers and consents, and all other actions to be taken by the Seller
         and the Shareholders in connection with consummation of the
         transactions contemplated by this Agreement, and all certificates,
         instruments, and other documents required to effect the transactions
         contemplated hereby, including deeds and bills of sale, will be
         reasonably satisfactory in form and substance to the Buyer and its
         counsel;

                  (n) Buyer shall have received all keys to all locks on the
         Real Property;

                  (o) Buyer shall have received an Owner's Policy of Title
         Insurance underwritten by the Title Company in the amount of the
         Purchase Price allocated to the Owned Real Property issued by Title
         Company, insuring that Buyer is the owner thereof subject only to the
         Permitted Encumbrances and the standard printed exceptions included in
         a Texas standard form owner's policy of title insurance; provided,
         however, that (i) the

                                       9
<PAGE>

         standard exception for discrepancies, conflicts, or shortages in area
         shall be deleted except for "shortages in area", (ii) such policy shall
         have "None of Record" endorsed regarding restrictions except for
         restrictions that are Permitted Encumbrances, (iii) the rights of
         parties in possession shall be deleted, and (iv) the standard exception
         for taxes shall be limited to the year in which the Closing occurs,
         marked "not yet due and payable", and subsequent years and subsequent
         assessments for prior years due to change in land usage or ownership;

                  (p) Current certificate issued by company acceptable to Buyer
         reflecting that since the date of the searches furnished pursuant to
         Section 4.8(c) hereof no Uniform Commercial Code filings, chattel
         mortgages, assignments, pledges, or other encumbrances have been filed
         in the offices of the Secretary of State of the State of Texas or the
         County Clerk of each county where the Real Property is located, with
         reference to the Real Property;

                  (q) the Seller and the Shareholders shall have delivered or
         caused to be delivered the items referenced in Section 2.2(a);

                  (r) fee titles and all leasehold interests (if any) in and to
         all parcels of Owned Real Property and all leasehold interests in and
         to Leased Real Property shall be conveyed to Buyer at Closing free of
         all leases, tenants, lessees or other occupants, whether permitted or
         unpermitted, other than Permitted Encumbrances;

                  (s) Seller shall have delivered or be prepared to
         unconditionally deliver to Buyer at Closing possession of all parcels
         of Owned Real Property, Leased Real Property and all other restaurant
         assets free and clear of all liens, encumbrances, mortgages,
         restrictions, conditions and other matters affecting title/occupancy of
         the restaurant assets, subject only to the Permitted Encumbrances;

                  (t) a legal opinion from Seller's counsel, dated the date of
         Closing to the effect that:

                           (i) Each entity comprising Seller is a corporation
                           validly existing and in good standing under the laws
                           of the State of Texas (as to which opinion, such
                           counsel may rely upon certificates from officials of
                           the State of Texas) and each has all requisite power
                           and authority to own its assets and to conduct the
                           Business in the manner heretofore conducted;

                           (ii) The consummation of the transactions
                           contemplated hereby have been duly authorized by all
                           necessary corporate action on the part of each Seller
                           and its Shareholders;

                           (iii) The execution and delivery of this Agreement
                           and the consummation of the transactions contemplated
                           hereby will not result in any violation of, or be in
                           conflict with provision of law, the Articles of
                           Incorporation or Bylaws of each Seller;

                           (iv) No consent, approval, authorization, order,
                           registration, declaration, filing or qualification by
                           or with any court or governmental authority

                                       10
<PAGE>

                           which has not been obtained is required of Seller
                           under existing law to authorize the execution or
                           delivery of this Agreement by Seller; and

                           (v) To the best of such counsel's knowledge, there is
                           no action, suit, proceeding or investigation pending
                           or threatened against Seller or any of their
                           properties or assets which questions the validity of
                           this Agreement or any action taken or to be taken
                           pursuant hereto.

                  (u) Seller shall have provided Buyer with evidence
         satisfactory to Buyer that Seller has terminated its Equipment Lease
         with respect to its point of sale cash register system and that Seller
         has received title to said assets, free and clear of any liens, claims
         or encumbrances and that same are included as part of Restaurant
         Assets;

                  (v) Buyer and Seller recognize and agree that the
         facilitation/application of liquor licenses shall begin immediately
         subsequent to the Effective Date and continue cooperatively and
         expeditiously until completion. However, in the event that Buyer shall
         not have secured from the Texas Alcoholic Beverage Commission all wine,
         beer and liquor permits to sell beverages at each of the restaurant
         locations, Seller shall enter into a Interim Management Agreement and
         Interim Concession Agreement as to any location that Buyer does not
         have a required permit in the forms set forth as Exhibits 2.3(v)-1 and
         2.3(v)-2 attached hereto and made a part hereof for all purposes; and

                  (w) Buyer, Guarantor, Seller and Shareholders shall have
         reached mutual agreement on all documents reasonably necessary for
         consummation of the transactions contemplated by this Agreement,
         including but not limited to the documents referred to in Sections
         2.2(a), (b) and (c) and Sections 1.3.1 and 2.3(u) (exclusive of the
         Exhibits which have been agreed upon).

         2.4 CONDITIONS TO SELLER'S OBLIGATIONS TO CLOSE. The obligations of the
Seller and the Shareholders to consummate the transactions to be performed by it
in connection with the Closing is subject to satisfaction of the following
conditions, any of which Seller may waive by execution of a writing so stating,
at or prior to the Closing:

                  (a) the representations and warranties set forth in Section
         3.2 below shall be true and correct in all material respects, at and as
         of the Closing Date;

                  (b) the Buyer and Guarantor shall have performed and complied
         with all of their covenants hereunder in all material respects through
         the Closing;

                  (c) the Buyer and Guarantor shall provide evidence
         satisfactory to the Seller that there have been obtained all consents,
         certified copies of resolutions, approvals and authorizations required
         for the consummation by the Buyer and Guarantor of the transactions
         contemplated by this Agreement, including, but not limited to, the
         Notes, Guaranty and such other documentation arising in connection
         herewith;

                  (d) the Buyer and Guarantor shall have delivered to the Seller
         a certificate dated as of the Closing Date and executed by the
         authorized officer of

                                       11
<PAGE>

         the Buyer and Guarantor, respectively, to the effect that each of the
         conditions specified above in Section 2.4(a)-(c) is satisfied in all
         respects;

                  (e) all actions to be taken by the Buyer and Guarantor (as
         applicable) in connection with consummation of the transactions
         contemplated by this Agreement, and all certificates, instruments, and
         other documents required to effect the transactions contemplated
         hereby, will be reasonably satisfactory in form and substance to the
         Seller and its counsel;

                  (f) the Seller and the Shareholders shall have received (1)
         all consents to assignment of the Leases and (2) full releases of the
         Seller and the Shareholders from all liability after Closing under the
         Leases and guaranties thereof;

                  (g) The Guarantor shall have executed and delivered to the
         Seller and Shareholders guaranties of the Notes and Assumed Liabilities
         in the form attached as Exhibit 1.6 B hereto and the guaranties
         described in Section 1.4;

                  (h) the Buyer and Guarantor shall have executed (where
         applicable) and delivered or caused to be delivered the items
         referenced in Section 2.2(b) and (c);

                  (i) Buyer, Guarantor and Seller shall have reached mutual
         agreement on all documents reasonably necessary for consummation of the
         transactions contemplated by this Agreement, including, but not limited
         to, the documents (other than agreed upon exhibits attached hereto)
         referred to in Section 2.2(a), (b) and (c), and Sections 1.3.1 and
         2.3(u) and the Subordination Agreement and the Change of Control
         provisions in the Notes referred to in Section 1.3.2;

                  (j) No action, suit or proceeding shall be pending or
         threatened before any court or quasi-judicial or administrative agency
         of any federal, state, local, or foreign jurisdiction or before any
         arbitrator wherein an unfavorable injunction, judgment, order, decree,
         ruling, or charge would (A) prevent consummation of any of the
         transactions contemplated by this Agreement, (B) cause any of the
         transactions contemplated by this Agreement to be rescinded following
         consummation, (C) affect adversely the right of the Seller to sell the
         Restaurant Assets or (D) impose any Liability upon Seller based upon
         the sale or any action or inaction of Seller relating in any way to the
         sale, and no such injunction, judgment, order, decree, ruling, or
         charge shall be threatened or in effect;

                  (k) Buyer and Seller shall have reached mutual agreement on
         Exhibit 1.4;

                  (l) Seller and Shareholders shall have received from Buyer, as
         franchisor, or licensor (including but not limited to Guarantor and
         Casa Ole Franchise Services, Inc.) (excluding the mix license which has
         already been reissued to Marco Products, L.P.) terminations and full,
         complete and unconditional releases of Seller and the Shareholders for
         liabilities arising in connection with any franchise and/or license by
         or among them;

                                       12
<PAGE>

                  (m) A license agreement between Casa Ole Franchise Services,
         Inc. and Marco Products, L.P. shall have been consummated and executed
         by both parties;

                  (n) a legal opinion from Buyer's counsel, dated the date of
         Closing to the effect that:

                  (i) Each entity comprising Buyer and Guarantor are a limited
                  partnership and corporation respectively, validly existing and
                  in good standing under the laws of the State of Texas (as to
                  which opinion, such counsel may rely upon certificates from
                  officials of the State of Texas) and each has all requisite
                  power and authority to own its assets and to conduct the
                  Business in the manner heretofore conducted;

                  (ii) The consummation of the transactions contemplated hereby
                  have been duly authorized by all necessary corporate action on
                  the part of each Buyer and Guarantor;

                  (iii) The execution and delivery of this Agreement and the
                  Guaranty and the consummation of the transactions contemplated
                  hereby will not result in any violation of, or be in conflict
                  with provision of law, the Articles of Incorporation or Bylaws
                  of Buyer and Guarantor;

                  (iv) No consent, approval, authorization, order, registration,
                  declaration, filing or qualification by or with any court or
                  governmental authority which has not been obtained (or will
                  not by Closing) is required of Buyer or Guarantor under
                  existing law to authorize the execution or delivery of this
                  Agreement by Buyer or Guarantor; and

                  (v) To the best of such counsel's knowledge, there is no
                  action, suit, proceeding or investigation pending or
                  threatened against Buyer or Guarantor or any of their
                  properties or assets which questions the validity of this
                  Agreement or any action taken or to be taken pursuant hereto.

                  (o) There shall not have been any material adverse changes in
         the financial conditions of the Buyer or Guarantor since the Effective
         Date; and

                  (p) Casa Ole Franchising Services, Inc. shall mutually agree
         with Seller and Thomas L. Harken as to the definitive terms and have
         executed and delivered to Seller and Thomas L. Harken an Agreement
         relating to Franchises with terms similar to those forms attached as
         Exhibits 2.4(p)-1 and 2.4(p)-2.

         2.5 TERMINATION. The Parties may terminate this Agreement as provided
below:

                  (a) the Buyer, the Seller and the Shareholders may terminate
         this Agreement by mutual written consent at any time prior to the
         Closing;

                  (b) the Buyer may terminate this Agreement by giving written
         notice to the Seller (i) at any time prior to the Closing in the event
         (a) Buyer discovers a material environmental issue affecting the Leased
         Real Property or Owned Real

                                       13
<PAGE>

         Property or (b) any of the Shareholders or Seller has breached any
         material representation, warranty, or covenant contained in this
         Agreement in any material respect, the Buyer has notified the Seller of
         the breach, and the environmental condition or breach has continued
         without cure (or adequate protection has been otherwise given to Buyer)
         for a period of ten (10) days (Closing to be extended to allow such ten
         (10) days cure, if necessary and applicable) after the notice of
         breach, (ii) at any time prior to the Closing if the Closing shall not
         have occurred on or before December 19, 2003, by reason of the failure
         of any condition precedent under Section 2.3 above (unless the failure
         results from the Buyer or Guarantor breaching any representation,
         warranty, or covenant contained in this Agreement), (iii) prior to
         November 19, 2003, for any reason in the Buyer's sole discretion; (iv)
         in the event Buyer is unsuccessful in securing financing on or before
         November 19, 2003, with terms acceptable to it in its sole discretion,
         or (v) at any time after the Effective Date, for any reason not set
         forth herein, upon the payment to Seller of a termination fee of
         $50,000.00; and

                  (c) the Seller may terminate this Agreement by giving written
         notice to the Buyer at any time prior to the Closing (i) in the event
         the Buyer or Guarantor has breached any material representation,
         warranty, or covenant contained in this Agreement in any material
         respect, the Seller has notified the Buyer and Guarantor of the breach,
         and the breach has continued without cure for a period of ten (10) days
         (Closing to be extended to allow such ten (10) days cure, if necessary
         and applicable) after the notice of breach, (ii) at any time prior to
         the Closing, if the Closing shall not have occurred on December 19,
         2003, by reason of the failure of any condition precedent under Section
         2.4 above (unless the failure results from the Seller breaching any
         representation, warranty, or covenant contained in this Agreement), or,
         (iii) at any time after the Effective Date, for any reason not set
         forth herein, upon the payment to Buyer of a termination fee of
         $50,000.00.

         2.6 EFFECT OF TERMINATION. If any Party terminates this Agreement
pursuant to Section 2.5 above, all rights and obligations of the Parties
hereunder shall terminate without any Liability of any Party to any other Party
and the sole remedy of the Parties shall be for payment of amounts due, if any,
under Section 2.5 and Section 7.9 of this Agreement.

                                   ARTICLE 3
                         REPRESENTATIONS AND WARRANTIES

         3.1 REPRESENTATIONS AND WARRANTIES OF SELLER AND SHAREHOLDERS. Each
Seller and Shareholders represent and warrant to the Buyer and Guarantor that
the statements contained in this Section 3.1 are correct and complete as of the
date of this Agreement and will be correct and complete as of the Closing Date
(as though made then and as though the Closing Date were substituted for the
date of this Agreement throughout this Section 3.1).

               3.1.1 ORGANIZATION. Seller is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of Texas
and/or Louisiana, as applicable, and has the corporate power to own its property
and to carry on its business as now being conducted. Seller is duly qualified
and/or licensed, as may be required, and in good standing in each of the

                                       14
<PAGE>

jurisdiction in which the nature of the business conducted by it or the
character o the property owned, leased or used by it makes such qualification
and/or licensing necessary.

               3.1.2 AUTHORITY RELATIVE TO THIS AGREEMENT; NON-CONTRAVENTION.

                  (a) Seller has the requisite corporate power and authority to
         enter into this Agreement and to carry out its obligations hereunder.
         The execution and delivery of this Agreement by Seller, the performance
         by Seller of its obligations hereunder and the consummation by Seller
         of the transactions contemplated herein have been duly authorized by
         the Board of Directors and Shareholders of Seller, and no other
         corporate proceeding on the part of Seller are necessary to authorize
         the execution and delivery of this Agreement, the performance by Seller
         of its respective obligations hereunder. This Agreement has been duly
         executed and delivered by Seller and Shareholders and, subject to the
         terms and conditions hereof, constitutes a valid and binding obligation
         of it, enforceable against them in accordance with its terms, except to
         the extent that such enforceability may be limited by applicable
         bankruptcy, insolvency, fraudulent transfer, reorganization or similar
         laws affecting the rights of creditors generally or by general
         principals of equity.

                  (b) Neither the execution and delivery of this Agreement by
         Seller, nor the consummation by Seller of the transactions contemplated
         herein nor compliance by Seller with any of the provisions hereof will
         materially (i) conflict with or result in any breach of the articles of
         incorporation or by-laws of Seller, (ii) subject to the receipt of
         required consents to assignments of real property leases and other
         Restaurant Assets, result in a violation or breach of any provisions
         of, or constitute a default (or an event which, with notice or lapse of
         time or both, would constitute a default) under, or result in the
         termination of, or accelerate the performance required by, or result in
         a right of termination or acceleration under, or result in the creation
         of any Lien upon any of the Assets under, or result in the loss of a
         material benefit under, any of the terms, conditions or provisions of
         any note, bond, mortgage, indenture, deed of trust, license, contract,
         lease, agreement or other instrument or obligation of any kind to which
         the Seller is a party or by which Seller or any of its properties or
         assets may be bound, or any permit, concession, franchise or license
         applicable to it or its properties or assets or (iii) subject to the
         receipt of required consents to assignments of real property leases and
         other Restaurant Assets, conflict with or violate any judgment, ruling,
         order, writ, injunction, decree, law, statute, rule or regulation
         applicable to Seller or any of its properties or assets, other than any
         such event described in items (ii) or (iii) which could not reasonably
         be expected to prevent the consummation of the transactions
         contemplated hereby.

                  (c) No action by any governmental authority is necessary for
         Seller's execution and delivery of this Agreement or the consummation
         by Seller or Shareholders of the transactions contemplated hereby,
         except where the failure to obtain or take such action would not
         reasonably be expected to prevent the consummation of the transactions
         contemplated hereby, subject to the receipt of required consents to
         assignments of governmental licenses or permits, if any.

                  (d) To the best knowledge of Seller and Shareholder's, no
         consents, approvals, orders, registrations, declarations, filings or
         authorizations are required on the

                                       15
<PAGE>

         part of Seller for or in connection with the execution and delivery of
         this Agreement or the consummation by Seller of the transactions
         contemplated on its part hereby, except required consents to
         assignments of real property leases and other Restaurant Assets.

               3.1.3 FINANCIAL STATEMENTS. Seller has delivered to Buyer copies
of the following financial statements which have been prepared in accordance
with accounting principles consistently followed as of and for the periods
indicated:

               (a) the internally generated balance sheets and income statements
         of Seller, and Seller's applicable related entities, dated as of
         December 31, 2002, which balance sheets and income statements present
         fairly the operations and the assets and liabilities at such date; and

               (b) the internally generated balance sheet and income statement
         of Seller at June 30, 2003, which balance sheet and income statement
         present fairly the operations and assets and liabilities of Seller at
         such date.

               Except as set forth in such financial statements, Seller has no
liabilities or obligations of any nature (whether accrued, absolute, contingent
or otherwise), which have not been set forth on the balance sheets (and except
for liabilities incurred since June 30, 2003), as may be required by accounting
principles consistently applied by Seller to be reflected on a such balance
sheet or in such notes. Such financial statements present fairly the financial
condition and operations of Seller as of the indicated dates and the results of
operations of Seller for the indicated periods are correct and complete in all
material respects and are consistent with the books and records of Seller. Such
financial statements have accurate accruals of all employee benefit costs
including, but not limited to, payroll, bonuses, and retirement benefits.
Schedule 3.1.3 describes the (i) variance between Seller's "consistently
applied" financial reporting practices and "generally accepted accounting
principles (GAAP)" and (ii) Seller's liabilities (including leases and notes
payable) not included on such financial statements.

               3.1.4 ABSENCE OF CERTAIN CHANGES. Since December 31, 2002, Seller
has conducted its business only in the ordinary course and there has not been
any change by Seller in accounting principles or methods except for internal
reallocations from restaurants to administration or vice versa as attached in
Exhibit 3.1.4.

               3.1.5 LITIGATION. Except as noted on Schedule 3.1.5, there is no
suit, action or legal, administrative, arbitration or other proceeding, or
governmental investigation or review pending or, to the knowledge of Seller or
Shareholders, threatened, to which Seller is, or would be, a party or by which
it is or would be affected (and Seller and Shareholders are not aware of any
basis for any such action, suit, or proceeding that has a reasonable likelihood
of being brought). Except as noted on Schedule 3.1.5, no product liability or
tort claims have been made, or to Seller's or Shareholders' knowledge,
threatened against the Seller relating to products sold or services performed by
Seller.

               3.1.6 BROKER'S OR FINDER'S FEES. No agent, broker, person or firm
acting on behalf of Seller or Shareholders or under any of their authority is or
will be entitled to any advisor's or broker's commission or finder's fee from
Seller or Shareholders in connection with any of the transactions contemplated
herein.

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<PAGE>

               3.1.7 SUBSIDIARIES. Except for the ownership of Crazy Jose
Restaurant Group Inc. by Casa Ole, of Beaumont, Inc. and the Excluded Assets,
Seller does not (i) own, directly or indirectly, any capital stock or other
ownership interest in any corporation, partnership, joint venture or other
entity and (ii) will not own prior to Closing, directly or indirectly, any
capital stock or other ownership interest in any corporation, partnership, joint
venture or other entity.

               3.1.8 BENEFIT PLANS. No lien imposed under Section 401(a)(29) or
Section 412(n) of the Code, Section 302(f) or Section 4068 of ERISA, or arising
out of any action filed under ERISA Section 4301(b), exists upon the Restaurant
Assets. Neither Seller nor any ERISA Affiliate has terminated any employee
pension benefit plan (within the meaning of Section 3(2) of ERISA) subject to
Title IV of ERISA (herein referred to as a "Title IV Plan") under circumstances
giving rise to, or that would give to any actual or potential liability to the
Pension Benefit Guaranty Corporation ("PBGC") or any other person, (ii) no event
or condition exists which presents a risk of termination of any Title IV Plan by
the PBGC, (iii) there is no actual or potential liability to the PBGC or any
other person expected by the Seller or any ERISA Affiliate to be incurred with
respect to any Title IV Plan, including, but not limited to, any liability for
any accumulated funding deficiency as defined in Section 302 of ERISA or for any
minimum funding contribution under Section 302 of ERISA, and (iv) no Title IV
Plan has applied for or obtained a waiver from the Internal Revenue Service of
any minimum funding requirement under Section 412 of the Code. Neither Seller
nor any ERISA Affiliate is required, or has been required during the past five
(5) years, to contribute to any "multiemployer plan" as such term is defined by
ERISA Section 3(37) (other than Seller companies). "ERISA Affiliate" means any
member of any "controlled group of corporations" as defined by Section 414(b) of
the Code that includes Seller, any member of any group of "trades or businesses
under common control" as defined by Section 414(c) of the Code that includes the
Seller, or any member of any "affiliated service group" as defined in Section
414(m) of the Code that includes Seller.

               3.1.9 COMPLIANCE WITH LAWS. Seller has not violated or failed to
comply with any statute, law, ordinance, regulation, rule, judgment, decree or
order of any governmental entity applicable to its business or operations in any
material respect which has not been resolved. Seller has not received any
written communication from a governmental entity that alleges that it is not in
compliance with any applicable law that has not been resolved. Except taxes not
yet due and payable, Seller is not required to make, and Seller has no
reasonable expectation that it will be required to make, any expenditures to
achieve or maintain compliance with existing applicable law (this representation
does not apply to any such requirements that may result from the consummation of
this transaction, including but not limited to requirements that may be imposed
on Buyer as a new owner under applicable fire codes, ADA laws, etc.). Seller is
in material compliance with all immigration and other laws relating to the
employment or retention of persons who are not citizens of the United States.

               3.1.10 CONTRACTS; DEBT INSTRUMENTS. The contracts which are
included in the Assumed Liabilities (the "Contracts") constitute all of the
contracts or agreements to which Seller is a party that are material to the
business, properties, assets, condition (financial or otherwise) and results of
operations of Seller that are to be assigned and assumed. Each Contract is in
full force and effect and is a legal, valid and binding agreement of the
applicable company and Seller, to the knowledge of Seller and Shareholders, of
each other party thereto, enforceable in accordance with its terms except to the
extent that its enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance or similar laws affecting the
rights of creditors generally and subject to general principles of equity.
Seller is not

                                       17
<PAGE>

in violation of or in default in any material respect (nor does there exist any
condition which upon the passage of time or the giving of notice would cause
such a violation of or default under) any loan or credit agreement, note, bond,
mortgage, indenture, lease, permit, concession, franchise, license or any other
Contract to which it is a party or by which it or any of its properties or
assets is bound.

               3.1.11 PROPERTIES.

               (a) Seller has good and marketable title to, or valid leasehold
         interests in their respective assets and properties, including the
         Restaurant Assets, are free and clear of all liens and encumbrances
         except for (i) upon Closing, any Assumed Liabilities, and (ii)
         properties and assets retired and disposed of in the ordinary course of
         business since the most recent Financial Statement, (iii) Existing
         Security Interest, if any, on Restaurant Assets to be released at or
         prior to Closing, and (iv) easements, rights of way, conditions,
         covenants, reservations, exclusions, leases, landlord rights, and other
         matters of record which will be subject to objections by Buyer pursuant
         to section 4.10. The tangible personal property used by Seller is in
         good operating condition and repair, ordinary wear and tear excepted,
         and all personal property leased by Seller is in the condition required
         of such property by the terms of the lease applicable thereto during
         the term of such lease and upon the expiration thereof.

               (b) Seller has complied in all material respects with the terms
         of all Leases to which it is a party and under which it is in
         occupancy, and all such Leases are in full force and effect.

               (c) None of Seller's property is subject to a lease which is not
         included in Exhibit 1.4.

               3.1.12 INTELLECTUAL PROPERTY.

               (a) To the best of Seller's knowledge, Seller owns or has the
         express or common law right to use pursuant to registration, filing or
         applicable law all Intellectual Property necessary for the operation of
         the business of Seller, as presently conducted, all as more fully
         described on Schedule 3.1.12(a) hereto. Seller's rights in each item of
         Intellectual Property owned or used by Seller immediately prior to the
         Closing hereunder will be owned or available for use by Buyer, by
         assignment thereof, on identical terms and conditions, if any,
         immediately subsequent to the Closing Date hereunder. Seller has taken
         action to maintain and protect the name of "Crazy Jose's".

               (b) To the best of Seller's knowledge, since January 1, 2001,
         Seller has not interfered with or infringed upon, misappropriated or
         otherwise come into conflict with, any Intellectual Property rights of
         third parties; Seller has not received any charge, complaint, claim,
         demand, or notice alleging any such interference, infringement,
         misappropriation, or violation (including any claim that Seller must
         license or refrain from using any Intellectual Property rights of any
         third party); and, to the knowledge of Seller and Shareholders, no
         third party has interfered with, infringed upon, misappropriated, or
         otherwise come into conflict with any Intellectual Property rights of
         Seller or Shareholders.

                                       18
<PAGE>

               (c) Schedule 3.1.12(c) identifies each registration which has
         been issued to Seller with respect to any of its Intellectual Property,
         identifies each pending application for registration which Seller has
         made with respect to any of its Intellectual Property, and identifies
         each license, agreement, or other permission which Seller has granted
         to any third party with respect to any of its Intellectual Property
         (together with any exceptions). Seller has delivered to Buyer correct
         and complete copies of all such registrations, applications, licenses,
         agreements, assumed names and permissions (as amended to date).
         Schedule 3.1.12(c) also identifies each trade name or unregistered
         trademark used by Seller in connection with its business. Except as set
         forth on Schedule 3.1.12(c), with respect to each item of Intellectual
         Property required to be identified in Schedule 3.1.12(c) and with
         respect to each item of copyrightable Intellectual Property (whether or
         not registration has been sought), to the best of Seller's knowledge:

               (i) Seller possesses all right, title, and interest in and to the
               item, free and clear of any lien, license, or other restriction;

               (ii) the item is not subject to any outstanding injunction,
               judgment, order, decree, ruling, or charge;

               (iii) no action, suit proceeding, hearing, investigation, charge,
               complaint, claim, or demand is pending or, to the knowledge of
               Seller and Shareholders if threatened which challenges the
               legality, validity, enforceability, use;

               (iv) ownership of the item; and

               (v) Seller has never agreed to indemnify any person for or
               against any interference, infringement, misappropriation, or
               other conflict with respect to the item.

               None of the Intellectual Property is owned by a third party or
used pursuant to license, sublicense, agreement, or permission, except as
provided in Section 1.2.14 and Schedule 3.1.12(c).

               3.1.13 CERTAIN EMPLOYEE MATTERS. No employee, agent, consultant
or contractor of Seller who has contributed to or participated in the conception
and development of Intellectual Property of Seller has asserted or threatened
any claim against Seller, since January 1, 2001, in connection with such
person's involvement in the conception and development of the proprietary rights
of Seller and, to the knowledge of Seller and Shareholders, no such person has a
reasonable basis for any such claim.

               3.1.14 INSURANCE. All of the policies of fire, liability,
worker's compensation, health and other forms of insurance presently in effect
with respect to Seller's business are valid and outstanding policies and provide
insurance coverage for the properties, assets and operations of Seller, of the
kinds, in the amounts and against the risks as management of Seller deems to be
adequate. No notice of cancellation or termination has been received with
respect to any such policy. To the knowledge of Seller, the activities and
operations of Seller have been conducted in a manner so as to conform in all
material respects to all applicable provisions of such insurance policies.

                                       19
<PAGE>

               3.1.15 TAXES.

               (a) Seller has timely filed with the appropriate taxing authority
         all tax returns required to be filed on or prior to the date hereof,
         including sales taxes, and each such tax return was properly completed
         and correct in all material respects at the time of filing. All taxes,
         including sales taxes, if any, for which tax returns are required, or
         not required, to be filed by Seller, for which Seller (or Buyer) is or
         could otherwise be held liable, or which are or could otherwise become
         chargeable as an encumbrance upon the Restaurant Assets (the taxes
         referred to in this Section being "Covered Taxes"), have been duly and
         timely paid through Closing or will be paid within thirty (30) days
         after Closing.

               (b) Seller has withheld and paid over all taxes required to have
         been withheld and paid over and complied with all material information
         reporting and backup withholding requirements, including maintenance of
         required records with respect thereto, in connection with material
         amounts paid or owing to any employee, independent contractor,
         creditor, shareholder or other third party.

               3.1.16 PROMOTIONS. Schedule 3.1.16 sets forth all promotions
currently in effect which promotions include discount coupons, free meals and
the like which schedule shall be certified/updated by Seller at Closing.

               3.1.17 INVENTORY. Each Restaurant is currently stocked and will
at Closing be stocked with an adequate amount of inventory, which is consistent
with historical and seasonal levels.

               3.1.18 PERMITS. To the best of its knowledge, Seller has in
effect mixed drink, beer or wine sale permits necessary to conduct its business.
No representation is made as to whether such permits will be obtainable by Buyer
as a new owner or what requirements will be imposed. Seller is aware that a
"Local Option Choice" circumstance has developed with respect to its store in
Port Arthur, Texas that may affect the ability of new applicants to obtain mixed
beverage permits possibly limiting such store to beer and wine only. The
Restaurant Assets are in compliance with TABC Regulations, liquor license
requirements and applicable law.

               3.1.19 DISCLOSURE. Seller has fully provided Buyer and Guarantor
with all the information it requested in connection with the transactions
contemplated hereby. Neither the representations and warranties in this Article
3, the Schedules and Exhibits attached hereto, nor any other written statements
or certificates made or delivered herewith or therewith, contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements contained herein or therein not misleading.

         3.2 REPRESENTATIONS AND WARRANTIES OF THE BUYER AND GUARANTOR. The
Buyer and Guarantor represent and warrant to the Seller and Shareholders that
the statements contained in this Section 3.2 are correct and complete as of the
date of this Agreement and will be correct and complete as of the Closing Date
(as though made then and as though the Closing Date were substituted for the
date of this Agreement throughout this Section 3.2).

               3.2.1 ORGANIZATION AND QUALIFICATION OF THE BUYER AND GUARANTOR.
Buyer and Guarantor (a) are corporations duly organized and validly existing
under the laws of Texas,

                                       20
<PAGE>

and (b) are duly authorized to conduct business and are in good standing under
the laws of each jurisdiction where such qualification is required.

               3.2.2 AUTHORIZATION OF TRANSACTION. Buyer and Guarantor have full
power and authority to execute and deliver this Agreement, and the other
documents executed or required to be executed, delivered and performed by the
Buyer and Guarantor in connection with this Agreement, and to perform their
obligations hereunder and thereunder. Without limiting the generality of the
foregoing, the governing bodies of Buyer and Guarantor have (or will have) duly
authorized the execution, delivery, and performance by the Buyer and Guarantor
of this Agreement and the other documents executed, or required to be executed,
delivered and performed by the Buyer and Guarantor in connection with this
Agreement. To their best knowledge, no proceeding on the part of the Buyer or
Guarantor, and, except for the approvals of the lessors under the Leases, and
certain lenders, no notice, consent, authorization, order or approval of, or any
bank, bonding company, surety, customer, supplier, or any other Person
whatsoever is required for, or in connection with the Buyer's or Guarantor's
execution, delivery and performance of this Agreement or the other documents
executed or required to be executed, delivered and performed by the Buyer or
Guarantor in connection with this Agreement, except where, in accordance with
applicable law, a notice, consent, authorization, order or approval, filing or
registration is required to consummate the transactions contemplated by this
Agreement or the other documents executed or required to be executed, delivered
and performed in connection with this Agreement. This Agreement constitutes the
valid and legally binding obligation of the Buyer and Guarantor, enforceable in
accordance with its terms and conditions.

               3.2.3 NONCONTRAVENTION. Neither the execution and the delivery of
this Agreement and the other documents executed or required to be executed,
delivered and performed in connection with this Agreement, nor the consummation
of the transactions contemplated hereby and thereby, will materially (i) violate
any constitution, statute, regulation, rule, injunction, judgment, order,
decree, ruling, charge, or other restriction of any government, governmental
agency, or court to which the Buyer or Guarantor is subject, (ii) violate any
provision of the organizational documents of the Buyer or Guarantor, or (iii)
violate or breach or result in (whether with the giving of notice or the lapse
of time or both) the violation or breach of any provision of, or result in the
acceleration of or entitle any party to accelerate (whether after the giving of
notice or lapse of time or both) any obligation under, or result in the creation
or imposition of any Security Interest or other encumbrance upon, any of the
Buyer's or Guarantor's assets pursuant to any provision of (or create in any
party the right to cancel or terminate) any mortgage, lien, lease, contract,
agreement, license, or instrument to which the Buyer or Guarantor is a party or
by which any of the Buyer's or Guarantor's assets is bound. The execution,
delivery and performance of this Agreement, and the other documents executed or
required to be executed, delivered and performed in connection with this
Agreement, by the Buyer and Guarantor do not, and the consummation by the Buyer
and Guarantor of the transactions contemplated hereby and thereby will not,
materially violate or conflict with any other restriction of any kind or
character to which the Buyer or Guarantor is subject or bound.

               3.2.4 CONTINUITY OF BUSINESS. Buyer represents to Seller and its
officers that it is Buyer's present intention to (i) continue Seller's
operations for the immediately foreseeable future at the same facilities, (ii)
to offer employment to at least 75% of the employees terminated by Seller at
Closing and (iii) to retain those who accept employment in Buyer's active employ
for a period of at least sixty (60) days from and after the date of Closing.

                                       21
<PAGE>

               3.2.5 SEC FILINGS. Guarantor will make available to the Seller
and the Shareholders, forms, statements and documents, as may be reasonably
requested by Seller and the Shareholders, filed by Guarantor with the SEC since
September 1, 2002, (collectively, the "Guarantor SEC Reports"). The Guarantor
SEC Reports (including any financial statements filed as a part thereof or
incorporated by reference therein) (i) at the time filed, complied in all
material respects with the applicable requirements of the Securities Act and the
Exchange Act, as the case may be, and (ii) did not, at the time they were filed
(or if amended or superseded by a filing prior to the date of this Agreement,
then on the date of such filing), contain any untrue statement of a material
fact or omit to state a material fact required to be stated in such Guarantor
SEC Reports or necessary in order to make the statements in such Guarantor SEC
Reports, in the light of the circumstances under which they were made, not
misleading.

               (i) Each of the consolidated financial statements (including, in
         each case, any related notes) of Guarantor contained in the Guarantor
         SEC Reports complied as to form in all material respects with the
         applicable rules, regulations and practices of the SEC with respect
         thereto, was prepared in accordance with "GAAP" applied on a consistent
         basis throughout the periods involved (except as may be indicated in
         the notes to such financial statements or, in the case of unaudited
         statements, as permitted by Form 10-Q under the Exchange Act) and
         fairly presented the consolidated financial position of Guarantor and
         its Subsidiaries as of the dates and the consolidated results of its
         operations and cash flows for the periods indicated, except that the
         unaudited interim financial statements were or are subject to normal
         and recurring year-end adjustments which were not or are not expected
         to be material in amount. The audited balance sheet of Guarantor as of
         December 31, 2002, is referred to herein as the "Guarantor Balance
         Sheet."

               (ii) Guarantor maintains a system of accounting controls
         sufficient to provide reasonable assurances that (A) its transactions
         and those of its subsidiaries are executed in accordance with
         management's general or specific authorization, (B) its transactions
         and those of its subsidiaries are recorded as necessary to permit
         preparation of financial statements in accordance with GAAP and to
         maintain accountability for assets, (C) access to its assets and those
         of its subsidiaries is permitted only in accordance with management's
         general or specific authorization, and (D) the recorded accountability
         for its assets and those of its subsidiaries is compared with existing
         assets at reasonable intervals and appropriate action is taken with
         respect to any differences.

                                   ARTICLE 4
                              PRE-CLOSING COVENANTS

         4.1 GENERAL. Each of the Parties will use its reasonable best efforts
to take all action and to do all things necessary or appropriate in order to
consummate and make effective the transactions contemplated by this Agreement
(including satisfaction, but not waiver, of the closing conditions set forth in
Article 2).

         4.2 NOTICES AND CONSENTS. The Seller and Shareholders, Buyer and
Guarantor will use their reasonable best efforts to obtain any third party
authorizations, consents, terminations, and approvals that may be necessary or
appropriate, or are requested by Seller or the Shareholders in connection with
consummating the transactions contemplated by this Agreement. Each of the
Parties will give any notices to, make any filings with, and use its best

                                       22
<PAGE>

efforts to obtain any authorizations, consents, and approvals of governments and
governmental agencies required for the transactions contemplated by this
Agreement.

         4.3 FULL ACCESS. The Seller will permit representatives of the Buyer
and Guarantor to have full access at all reasonable times, and in a manner so as
not to unduly interfere with the normal business operations of the Seller, to
all premises, properties, personnel, books, records (including tax records),
contracts, and documents of, or pertaining to, the Restaurant Assets and Real
Property. The Buyer and Guarantor shall maintain the confidence of the items and
information obtained pursuant to this Section 4.3 in accordance with the
requirements of Section 4.4.1. The Buyer and Guarantor and their representatives
shall not, without the Seller's prior consent (which shall not be unreasonably
withheld), communicate with any of the Seller's employees or representatives
regarding the nature of this Agreement. The Seller shall use commercially
reasonable efforts to cause all information requested by Buyer and Guarantor in
connection with its due diligence investigation of the Restaurant Assets and
Real Property to be timely made available to Buyer and Guarantor so that Buyer
and Guarantor will have a commercially reasonable opportunity to evaluate the
information prior to expiration of the Due Diligence Period. In the event that
Buyer and Guarantor timely request certain information from Seller and the
Seller fails to make available the information to the Buyer and Guarantor in a
manner that provides the Buyer and Guarantor with a commercially reasonable
opportunity to evaluate the information prior to expiration of the Due Diligence
Period, the Due Diligence Period will be extended by a commercially reasonable
amount of time to be mutually determined by the Buyer, Guarantor and Seller.
Buyer and Guarantor agree to deliver to Seller, promptly after receipt thereof,
copies of any written inspection reports regarding Restaurant Assets prepared
for Buyer and Guarantor by consultants, engineers, or other inspectors. Buyer
and Guarantor shall give Thomas L. Harken or Victor M. Gonzalez twenty-four (24)
hours prior notice of any on-site inspections or interviews and Seller shall
have the right to have a representative accompany the inspector or interviewer.

         4.4 CONFIDENTIALITY. The provisions of this Section 4.7 shall supersede
and replace all prior agreements and understandings of the parties with respect
to the subject matter hereof.

                  4.4.1 CONFIDENTIAL INFORMATION. Until the Closing of the
         transactions contemplated herein, all Confidential Information acquired
         by Buyer or Guarantor with respect to the Seller or the Shareholders,
         or by the Seller or the Shareholders with respect to the Buyer or
         Guarantor, shall be (i) maintained in strict confidence, (ii) used only
         for the purpose of and in connection with evaluating the transactions
         contemplated herein, and (iii) disclosed only (A) to employees and duly
         authorized agents and representatives who have been informed of the
         obligations of the Parties under this Section 4.4.1 with respect to
         such Confidential Information, who have a need to know the information
         in connection with consummating the transactions contemplated herein,
         and who agree to keep such information confidential, or (B) as required
         in the opinion of counsel to any Party in order for the Party to meet
         the requirements of any applicable law or regulations, or the
         determination of any court (of which the other Parties shall be given
         prompt written notice). The Buyer, Guarantor, Seller and Shareholders
         each shall take all commercially reasonable measures to prevent its
         employees and representatives from making any unauthorized disclosure
         of any Confidential Information. If the transactions contemplated
         herein are not consummated, except as the Parties otherwise mutually
         agree, all Confidential Information in written, printed or other
         tangible form (whether copies or originals) shall be returned to the
         Party of origin, and all documents,

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<PAGE>

         memoranda, notes and other writings whatsoever prepared by any Party or
         its representatives based on Confidential Information shall be
         destroyed; and each Party and its representatives will thereafter hold
         all Confidential Information concerning each Party in strict
         confidence.

                  4.4.2 PRESS RELEASES AND ANNOUNCEMENTS. No press release,
         public announcement, confirmation or other information regarding this
         Agreement or the contents hereof or the consummation of the
         transactions contemplated hereby shall be made by the Buyer, Guarantor,
         Seller or Shareholders except with the mutual consent of all parties or
         as required by applicable law.

         4.5 COMMUNICATION WITH SELLER'S EMPLOYEES. The Seller, Shareholders,
Buyer and Guarantor shall cooperate with each other in connection with any
communications made to the Seller's employees regarding this Agreement or the
transactions contemplated hereby. Neither Seller nor the Shareholders will take,
or fail to take, any action that would materially interfere with Buyer's
opportunity to hire or employ a commercially reasonable number of qualified
employees for purposes of operating the Restaurants immediately following the
Closing.

         4.6 REMOVAL OF EXCLUDED ASSETS. The Seller shall remove the personal
property constituting Excluded Assets from the premises of the Restaurants
(including the Real Property), prior to five (5) days after the Closing Date,
and shall give reasonable prior notice to the Buyer of the date and time(s) of
such removal activities. Any items of Excluded Assets that thereafter remain on
the premises of the Restaurants (including the Real Property) shall become the
property of the Buyer, and Buyer shall have no obligation or duty of any kind to
the Seller with respect thereto.

         4.7 RISK OF LOSS. The Seller shall bear the risk of loss associated
with any damage or destruction to the Restaurant Assets, or any part thereof, by
theft, vandalism, fire, act of God, other loss or casualty, or through
condemnation or sale in lieu thereof, until the Closing.

         4.8 DELIVERY OF INFORMATION TO BUYER. As soon as practicable after the
date of this Agreement:

                  (a) Buyer shall obtain (1) commitment for Title Insurance
         ("Title Commitment") from Commonwealth Land Title Company ("Title
         Company") issued by an office or agency of the Title Company selected
         by Buyer setting forth the status of the title of the Real Property
         (including all parcels of Owned Real Property and Leased Real Property)
         and showing all liens, claims, encumbrances, easements, rights-of-way,
         encroachments, reservations, restrictions, and all other matters of
         record affecting the Real Property; and (2) a true, complete, and
         legible copy of all documents referred to in the Title Commitment
         ("Title Commitment Documents").

                  (b) Buyer shall obtain a survey ("Survey") for each parcel of
         Owned Real Property and Leased Real Property consisting of a plat and
         field notes prepared by a licensed surveyor acceptable to Buyer and
         Title Company, which Survey shall (i) reflect the actual dimensions of,
         and area within, the Land, the location of any easements, setback
         lines, encroachments, or overlaps thereon or thereover, and the outside
         boundary lines of all Improvements, (ii) identify by recording
         reference all easements, set back lines, and other matters referred to
         in the Title Commitment, (iii) include the surveyor's

                                       24
<PAGE>

         registered number and seal, the date of the Survey, and a certificate
         satisfactory to Buyer, (iv) reflect that there is access to and from
         the Land from a publicly dedicated street or road, (v) be sufficient to
         cause the Title Company to delete (except for "shortages in area") the
         printed exception for "discrepancies, conflicts or shortages in area or
         boundary lines, or encroachments, or any overlapping of improvements"
         in the Owner's Title Policy to be delivered at Closing, (vi) reflect
         any area within the Land that has been designated by the Federal
         Insurance Administration, the Army Corps of Engineers, or any other
         governmental agency or body as being subject to special or increased
         flooding hazards, and (vii) in general, comply with the requirements of
         the Texas Surveyor's Association for a Category lA, Condition II survey
         or other applicable Category and/or Condition survey in accordance with
         the rule and regulations promulgated by the Texas Surveyor's
         Association and the Texas Land Title Association. For purposes of the
         property description to be included in the special warranty deed to be
         delivered at Closing, the field notes prepared by the surveyor shall
         control any conflicts or inconsistencies and such field notes shall be
         incorporated herein by this reference upon their completion and
         approval by Buyer.

                  (c) Buyer shall request the Title Company to deliver to Buyer
         current searches of all Uniform Commercial Code financing statements
         filed with the Office of the Secretary of State of Texas and the County
         Clerk of each County within which the Real Property is located against
         Seller and Seller's predecessors in title reflecting all effective
         financing statements then of record relating to the Property or any
         part thereof.

                  (d) Seller shall make available to Buyer for inspection (i)
         copies of all agreements relating to the Real Property and (ii) copies
         of all engineering and technical reports in the possession of Seller or
         its representatives that concern the Real Property, including soils
         testing reports, property condition reports, and reports of
         environmental or hazardous waste inspections or surveys.

         4.9 DELIVERY OF INFORMATION BY SELLER. As soon as reasonably
practicable after the Effective Date of this Agreement, Seller shall deliver,
and shall certify completion of delivery, at its corporate office in Beaumont,
Texas, the following information and documentation to Buyer or Buyer's legal
counsel:

                  (a) copies of all Leases, addenda, exhibits and amendments to
         all Leases with respect to all of the parcels of Leased Real Property;

                  (b) copies of all correspondence, notices, memoranda or other
         written communications to Seller or any agent or representative of
         Seller pertaining to any violation by Seller or any of the parcels of
         Owned Real Property or Leased Real Property of any ordinance, law, rule
         or regulation of any governmental authority during the two year period
         immediately preceding the Effective Date this Agreement;

                  (c) copies of all Certificates of Occupancy with respect to
         each parcel of the Owned Real Property and Leased Real Property;

                  (d) any and all correspondence, memoranda, notices and/or
         other written communications to Seller or any agent or representative
         of Seller received since August

                                       25
<PAGE>

         1, 2001, regarding any alleged violation, breach or default of any
         agreement or covenant pertaining to any parcel of Owned Real Property
         and Leased Real Property;

                  (e) copies of any subordination agreement, non-disturbance
         agreement, attornment agreement, lien priority agreement or any other
         agreement, in Seller's possession, with any lender holding a lien,
         encumbrance, deed of trust or mortgage on any parcel of the Leased Real
         Property affecting the leasehold interest with respect to such
         Property;

                  (f) copies of all pleadings, citations, correspondence,
         memoranda or other written instruments or communications pertaining to
         any existing or threatened litigation or administrative proceedings
         received since August 1, 2001, with respect to any parcel of the Owned
         Real Property or Leased Real Property;

                  (g) all contracts, agreements, commitments or other
         undertaking of Seller with respect to or affecting any of the parcels
         of Owned Real Property or Leased Real Property;

                  (h) any and all reports or other written materials,
         correspondence, memoranda or other written communications pertaining to
         any hazardous material (as defined by applicable Federal or State of
         Texas law or regulation) or other environmental matter affecting or
         potentially affecting any parcel of Owned Real Property or Lease Real
         Property;

                  (i) all water, sewer and waste water agreements, capacity
         agreements, capacity letters, usage agreements or any other written
         matters pertaining to the obtaining, use and/or discharge of water,
         sewage and/or waste water with respect to any parcel of Owned Real
         Property or Leased Real Property;

                  (j) if not set forth in the Lease Agreements with respect to
         the parcels of Leased Real Property, written waivers of the statutory
         Landlord's lien and any contractual Landlord's lien with respect to
         each such Lease Agreement; and

                  (k) copies of all currently existing franchise and/or license
         agreements, not with Buyer, Guarantor, or their affiliates, regarding
         the business operations of Seller at each parcel of Owned Real Property
         or Leased Real Property.

         4.10 TITLE. Buyer shall have the right, at any time within twenty (20)
days after receipt of each of the items described in Section 4.8 and 4.9
inclusive, to object in writing to any liens, encumbrances and/or other matters
reflected by such items. All items to which Buyer so objects are hereinafter
referred to as the "Non-Permitted Encumbrances"; if no such notice of objection
is given within such time period, then it shall be deemed that all matters
reflected by such items are "Permitted Encumbrances." Seller shall have the
right, but not the obligation, at its sole cost, to cure or remove all
Non-Permitted Encumbrances and give Buyer written notice thereof prior to
Closing; provided, however, that Seller, at its sole cost, shall be obligated to
cure or remove at or before Closing all mortgages, deeds of trust, judgment
liens, mechanics and materialmen's liens, and/or other liens against the Owned
Real Property and against the Seller's leasehold interests (as distinguished
from the fee interests) of each parcel of Leased Real Property, ("Existing
Security Interests"), whether or not Buyer objects thereto during the
aforestated time

                                       26
<PAGE>

period. If Seller does not timely cause all of the Non-Permitted Encumbrances to
be removed or cured, and timely written notice thereof to be given to Buyer,
then Buyer shall have the right either (i) to terminate this Agreement in
accordance with Section 2.5(b) hereof by delivering notice to Seller before
Closing, or (ii) to elect to close the purchase contemplated under this
Agreement subject to the Non-Permitted Encumbrances, other than liens that
Seller is obligated to cure or remove, and the Non-Permitted Encumbrances (other
than liens that Seller is obligated to cure or remove) subject to which Buyer
elects to purchase the Property shall thereafter be Permitted Encumbrances and
all conveyances and assignments shall be expressly subject thereto.

         4.11 NO SHOP. Commencing with the date of this Agreement and continuing
for a period of sixty (60) days following termination hereof, Seller and
Shareholders shall not directly or indirectly enter into any discussions with
any other party for any "Takeover Proposal". In the event that Seller or any
Shareholder receives any inquiries related to same, Seller or such Shareholder
shall immediately notify Buyer of same. As used herein, the term "Takeover
Proposal" means any proposal or offer (whether or not in writing and whether or
not delivered to the Shareholders or owners of the Seller generally) for a
merger or other business combination involving the Seller or to acquire in any
manner, directly or indirectly, a material equity interest in, any voting
securities of, or a substantial portion of the assets of the Seller, other than
the transactions contemplated by this Agreement. This provision shall survive
the termination of this Agreement."

                                   ARTICLE 5
                             POST-CLOSING COVENANTS

         5.1 GENERAL. If at any time after the Closing any further action is
necessary or desirable to carry out the purposes of this Agreement, each of the
Parties will take such further action (including the execution and delivery of
such further instruments and documents) as any other Party reasonably may
request, all at the sole cost and expense of the requesting Party (unless the
requesting Party is entitled to indemnification therefor under Article 6 below).
The Seller and each of the Shareholders acknowledge and agree that from and
after the Closing, the Buyer will be entitled to access, at reasonable times,
and upon reasonable notice thereto, and shall be entitled to make photocopies at
the Buyer's expense of, all Books and Records that constitute Excluded Assets;
Seller and the Shareholders further agree to maintain such books and records in
their entirety for a period of seven years after the Closing Date. The Seller
and the Shareholders shall be entitled to access at reasonable times and upon
reasonable notice, and shall be entitled to make photocopies at
Seller's/Shareholders' expense of, all Books and Records constituting part of
the Restaurant Assets, to the extent necessary for defense of audits or
litigation or preparation of tax returns. Further, for a period of ten (10) days
after Closing, Seller and Shareholders shall be granted access, upon at least
twenty-four (24) hours notice, to the computers and related hardware and
software constituting part of the Restaurant Assets for the purpose of
completing accounts payable and payroll runs through the Closing Date. In no
event shall Seller or Shareholders be obligated hereby to take any action, make
any agreements or covenants, or execute and deliver any instrument or documents
which would impose upon or any of them or result in any new or additional
liability inconsistent with Section 6.1 or 6.2.

         5.2 COVENANT NOT TO COMPETE AND CONFIDENTIALITY.

                                       27
<PAGE>

                  5.2.1 RESTRICTIVE COVENANTS. In consideration of the Purchase
         Price and the other benefits to be provided to Seller and the
         Shareholders by Buyer under this Agreement, the Seller and each
         Shareholder hereby covenants and agrees, severally and not jointly,
         that the covenants, agreements, and restrictions contained in this
         Section 5.2 are necessary to protect the business goodwill, business
         interests and proprietary rights of Buyer, and that the Seller and
         Shareholders have independently discussed, reviewed, and had the
         opportunity of legal counsel to consider these covenants. The parties
         hereby agree and acknowledge that Buyer has spent considerable sums of
         money to acquire the Restaurant Assets and that the customers and
         customer goodwill developed by Seller, and sold to Buyer hereby, are
         worth a considerable amount of money and therefore is a benefit which
         Buyer seeks to protect. The parties further acknowledge and agree that
         Seller and the Shareholders have previously been obligated pursuant to
         restrictive covenants and confidentiality requirements set forth in the
         Casa Ole Franchise Agreements and modifications, amendments and waivers
         affecting such agreements, if any. The parties to this Agreement, with
         the consent of the Franchisor, do hereby agree that the restrictive
         covenants and confidentiality requirements contained in this Agreement
         shall substitute and replace those set forth in the Franchise
         Agreements. Such protection is hereby agreed and acknowledged by these
         parties as being reasonable consideration for establishing this
         restrictive covenant. Further, the parties hereto agree that this
         covenant is fair and reasonable in its geographical area, length of
         time, and scope of activity being restrained. For good and valuable
         consideration acknowledged to have been received on the date of
         execution hereof, and as an inducement to the Buyer to enter into this
         Purchase and Sale transaction, the undersigned agrees as follows:

                  5.2.2 DEFINITIONS:

                  (i) The term "Competing Business" as used herein shall refer
                  to any business (whether conducted through an individual or an
                  entity) which conducts the business of the sale of any type of
                  food in restaurants or catering in the geographic areas as
                  described in Section 5.2.5;

                  (ii) The term "Non-Compete Period" as used herein shall refer
                  to the four (4) year period commencing on the Closing (two (2)
                  years for the three (3) restaurants located at (i) 1700 Ruth
                  Street, Sulphur, Louisiana, (ii) 4058 Ryan Street, Lake
                  Charles, Louisiana and (iii) 2312 Kaliste Saloom, Lafayette,
                  Louisiana) provided that in the event the Seller and/or
                  Shareholders violate any aspect of this Section 5.2, the
                  Non-Compete Period shall be extended by the number of days
                  during the period from the commencement of the violation
                  through the time when the Seller and/or Shareholder cease
                  violating this Section 5.2;

                  (iii) The term "solicit" as used herein shall refer, in
                  addition to its common usage, to communications or
                  transactions whether initiated by Seller and/or Shareholder's
                  or by a third party; and

                                       28
<PAGE>

                  (iv) The term "Covenant Trigger" as used herein shall refer to
                  the Closing Date.

                  5.2.3 GENERAL. Seller and Shareholders hereby acknowledge that
         there are legitimate protectable business interests at stake (such as
         protection of the Buyer's goodwill, customers, employees and trade
         secrets and other confidential information), that breach of this
         Section would harm the Buyer and that the restrictions and restraints
         contained in this covenant are reasonable.

                  5.2.4 ANCILLARY TO ENFORCEABLE AGREEMENTS. Seller and
         Shareholders stipulate, acknowledge and agree that these restrictive
         covenants are ancillary to and an integral part of an enforceable
         agreement and are prior or ancillary to the interests sought to be
         protected hereby.

                  5.2.5 NON-COMPETITION. Seller and Shareholders, severally and
         not jointly, agree that, during the Non-Compete Period, Seller and
         Shareholders will not, directly or indirectly, for themselves or on
         behalf of or in conjunction with any other person, company,
         partnership, corporation or business of whatever nature, engage in any
         Competing Business within Calcasieu or Lafayette Parishes, Louisiana,
         or if outside Louisiana, within One Hundred (100) miles of any
         restaurant, or food catering business, now owned, operated, leased or
         franchised by Buyer, or by Guarantor, or any of their subsidiaries or
         affiliates, all of which stores are described on Schedule 5.2.5, which
         areas are, again, hereby specifically acknowledged by Seller and
         Shareholders to be reasonable and necessary for Buyer to protect its
         interests.

                  5.2.6 SOLICITATION OF CUSTOMERS. Seller and Shareholders,
         severally and not jointly, agree that, during the Non-Compete Period,
         Seller and Shareholders will not, directly or indirectly, for
         themselves or on behalf of or in conjunction with any other person,
         company, partnership, corporation or business of whatever nature,
         knowingly contact, solicit or otherwise conduct business involving a
         Competing Business with any person or entity that has been, at any time
         during the one year period preceding the Covenant Trigger, or is then
         contemplated to be, a customer of the Seller and/or Shareholders (the
         "Customer"), to purchase or otherwise acquire goods and/or services
         offered by any Competing Business.

                  5.2.7 SOLICITATION OF TRANSACTIONS. Seller and Shareholders,
         severally and not jointly, agree that, during the Non-Compete Period,
         Seller and Shareholders will not, directly or indirectly, for
         themselves or on behalf of or in conjunction with any other person,
         company, partnership, corporation or business of whatever nature,
         solicit (either directly or indirectly through a broker or otherwise)
         any person or entity that has been in contact, verbally or in writing,
         with the Seller and/or Shareholders, or any representative of the
         Seller and/or Shareholders at any time during the two year period
         preceding the Closing, regarding any existing or potential opportunity,
         project or venture with the Seller and/or Shareholders for any
         Competing Business.

                  5.2.8 REFORMATION. Should any court of competent jurisdiction
         determine that, consistent with the established precedent of the forum
         jurisdiction, the public policy of such jurisdiction requires a more
         limited restriction in geographic area, duration, nature

                                       29
<PAGE>

         of restricted activity, or any combination thereof, it would be in
         furtherance of the intentions of the parties hereto for the court to so
         interpret and construe the terms of this Section 5.2 to apply only to
         the extent of such limited restriction. The parties acknowledge and
         agree to the applicability of the Texas Covenants Not to Compete Act
         (TX Bus & Com Section 15.50 et seq) relative to the interpretation and
         enforcement of the restrictive covenants set forth in this Agreement.

                  5.2.9 APPROVED TRANSACTIONS. Notwithstanding the foregoing
         requirements of this Section 5.2, a Shareholder may purchase or
         otherwise acquire up to (but not more than) one percent of any class of
         securities of any enterprise (but without otherwise participating in
         the activities of such enterprise) if such securities are listed on any
         national or regional securities exchange or have been registered under
         Section 12(g) of the Exchange Act.

                  5.2.10 SURVIVAL. The Buyer, the Seller, and each Shareholder
         agree that the agreements set forth in this Section 5.2 each constitute
         separate agreements independently supported by good and adequate
         consideration and shall be severable from the other provisions of, and
         shall survive, this Agreement.

                  5.2.11 REMEDIES. The Seller, each Shareholder, and the Buyer
         agree that the remedy at law for any breach by the Seller or any
         Shareholder of this Section 5.2 will be inadequate and that the Buyer
         shall be entitled to injunctive relief without a posting of bond. Such
         remedy with respect to Seller shall be in addition to such other
         remedies as may be available to Buyer at law or in equity.

                  5.2.12 MISCELLANEOUS. As to Mr. Gonzalez only, the covenants
         under the Section 5.2 shall continue to apply to Mr. Gonzalez for an
         additional time period in accordance with the Employment Agreement
         entered into under Section 2.3(j) to the fullest extent possible under
         applicable law. The time period reflected in Section 5.2.5 shall
         constitute the minimum time period as regards such covenants of Mr.
         Gonzalez.

                  5.2.13 CONFIDENTIALITY OF INFORMATION. Seller and
         Shareholders, severally recognize that the business interests of Buyer
         require the fullest protection and confidential treatment of the trade
         secrets, know how, and other business knowledge developed, conceived
         and learned by Seller and/or Shareholders (as distinguished from
         Buyer's trade secrets, know how and other business knowledge), such
         trade secrets, know how and other business knowledge including, without
         limitation, customer lists, bids and proposals, price lists, products,
         recipes, manuals, documentation, forms, techniques, methods,
         procedures, systems, data processes, plans, computer programs, other
         intangible assets and other information of the Seller, including
         evaluations and use or non-use of other technical or business
         information not in the public domain (collectively referred to herein
         as the "Seller's Information") and that such Seller's Information
         constitutes valuable, special and unique assets acquired by Buyer in
         this transaction. Accordingly, Seller and Shareholders severally agree
         that during the Non-Compete Period they will cause the Seller's
         Information to be treated as strictly confidential and held in trust
         solely for the use and benefit of the Buyer. Seller and Shareholders
         severally agree that during the Non-Compete Period they shall not
         directly or indirectly use or knowingly permit others to use any such
         Seller's Information in a Competing Business, or for Seller and
         Shareholders own account in a Competing Business, and shall not
         directly or indirectly

                                       30
<PAGE>

         disclose any such Seller's Information to any person, firm,
         corporation, association or other entity for use in a Competing
         Business for any reason or purpose whatsoever unless consented to in
         writing by Buyer. For purposes hereof, authorized representatives of
         the Buyer shall be directors and officers of the Buyer. The obligations
         of this Section 5.2.13 shall not apply (a) to Seller's Information that
         (i) is in the public domain; or (ii) is or becomes generally available
         in the public domain other than pursuant to a breach by Seller or
         Shareholder's of their obligations under this Section 5.2.13, or (b) to
         the use of Seller's Information in a "non-commercial" manner (personal
         consumption, etc.), or (c) to the use of Seller's Information for
         Seller's or Shareholder's use in the operation of a restaurant outside
         the non-compete zone of One Hundred (100) miles or (d) as may be
         legally required in accordance with applicable law.

                  Additionally, with respect to Seller's and Shareholder's
         existing franchisee relationships with Buyer's affiliate, Casa Ole
         Franchise Services, Inc. ("COFSI"), Seller and Shareholders severally
         acknowledge and agree that with respect to COFSI's trade secrets, know
         how and other business knowledge developed, conceived and learned by
         COFSI (" COFSI's Information" as distinguished from Seller's
         Information), such COFSI's Information being previously franchised and
         licensed to Seller by COFSI, that such COFSI's Information shall remain
         confidential as previously provided for under those franchise
         agreements and Seller and Shareholders covenant not to directly or
         indirectly reveal nor use same, such COFSI's Information remaining the
         exclusive property of COFSI.

                  5.2.14 ENFORCEMENT. Seller and Shareholders acknowledge that
         the rights reserved to the Buyer under this Section 5.2 are necessarily
         of a special, unique and extraordinary nature and that the loss arising
         from a breach or threatened breach thereof cannot reasonably and
         adequately be compensated by money damages and will cause the Buyer to
         suffer irreparable harm and that a remedy at law for any breach thereof
         will be inadequate. Accordingly, Seller and Shareholders hereby agree
         that the Buyer shall be entitled to injunctive or other extraordinary
         relief in case of any such breach or threatened breach prohibiting such
         breach or attempted or threatened breach and commanding compliance with
         any such Section, but only after notice and opportunity to cure have
         been given in accordance with section 5.2.15, merely by proving the
         existence of such breach or threatened or attempted breach, and without
         the necessity of proving irreparable harm or inadequacy of legal
         remedies. Further, Seller and Shareholders hereby stipulate that, as
         liquidated damages for Seller and/or Shareholders, as applicable,
         violation of Sections 5.2.5, and 5.2.13 only, Buyer, by virtue of such
         conduct of a Seller or a Shareholder, severally, shall suffer, at
         minimum, fixed and liquidated damages of One Million and No/l00 Dollars
         ($1,000,000.00) (the "Liquidated Damages"), which amount Seller and
         Shareholders acknowledge would be a minimum amount of damages suffered
         by Buyer, and which liquidated damages claim may be satisfied by
         Buyer's offset of such claim against any indebtedness it may have with
         Seller and/or Shareholders, as applicable, including, but not limited
         to, those certain Promissory Notes, of even date herewith, by and
         between Buyer and/or Shareholders. It being agreed that such amount is
         not a penalty but same constitutes the parties best estimate of the
         damages that Buyer would sustain as lost profits in the event of such
         breach. However, this provision shall in no way limit any other rights
         or remedies, which the Buyer may have under the terms of this Agreement
         or at law or in equity. In case of breach by Seller or

                                       31
<PAGE>

         Shareholders, as applicable, of any other provision of this Section 5.2
         (other than Section 5.2.5 and 5.2.13) or Section 7.18, then Buyer shall
         be entitled to recover its actual damages allowed by law.
         Notwithstanding anything contained in Section 5.2.13 and/or this
         Section 5.2.14 to the contrary, the Liquidated Damages shall only apply
         if a Section 5.2.5 or Section 5.2.13 breach occurs within the
         non-compete zone of One Hundred (100) miles.

                  5.2.15 NOTICE AND CURE. Notwithstanding any provision of this
         Agreement to the contrary, the Buyer will not be liable for any
         liquidated damages under this Agreement unless the Seller shall have
         notified the Buyer in advance of such breach and the Buyer shall have
         at least fifteen (15) days to cure such breach. For the purposes of
         this Section, the Buyer shall be deemed to have cured the breach if the
         Buyer ceases the activities that are alleged to be the grounds giving
         rise to such liquidated damages within fifteen (15) days of receipt of
         notice from the Seller.

                  5.2.16 MISCELLANEOUS. The covenants and restrictions in this
         Section 5.2 shall survive Closing and remain in full force and effect.

         5.3 EMPLOYEES. The Buyer shall have the right, but is not obligated, to
offer employment to any person employed by the Seller in connection with the
Restaurant Business except as provided in Section 3.2.4; provided, however, that
Buyer agrees that it will offer employment to Sara Lake and Michel Maisonneuve
which provides for their employment for not less than one (1) year after Closing
(subject to termination for Cause or without Cause upon payment of severance
with base salaries for such period in the same amount as each such person was
paid for the Seller's last fiscal year ended prior to Closing) so long as the
restaurants in the aggregate have the same or greater economic performance
(without allocation of general administrative expenses) as that achieved in such
fiscal year and with bonuses and benefits equal to or better than those offered
by Buyer or Guarantor to their employees. Except as otherwise expressly provided
in this Agreement, the Buyer and Seller each hereby acknowledge and agree that
the Buyer does not hereby assume any past or future obligation of the Seller to
any person who is, was, or becomes an employee of Seller, whether or not the
Buyer offers employment to such person. Seller agrees to be responsible for
bonuses due, if any, to Victor M. Gonzalez, Sara Lake, and Michel Maisonneuve,
for the applicable bonus period pro-rated through the Closing Date, but not for
any bonuses that may be due thereafter. Buyer agrees that following the Closing
and continuing until at least March 31, 2004, Buyer will (if available to Buyer
or Guarantor in accordance with their current coverages) provide to Victor M.
Gonzalez, Sara Lake and Michel Maisonneuve, and all other employees of Seller
who are covered under Seller's medical and hospitalization coverage at the time
of Closing, and who are employed by Buyer, equal or better coverage to that
provided by Seller. Following such date, Buyer shall provide its employees with
reasonable medical and hospitalization coverage (if available to Buyer or
Guarantor in accordance with their current coverages) equal or better than that
provided by Buyer or Guarantor to its own employees of similar corporate
position and salary, with no gaps in coverage, no waiting periods, and no
exclusions for prior conditions. All benefits provided for Victor M. Gonzalez,
Sara Lake and Michel Maisonneuve shall take into account, and given credit for
prior service with Seller.

         5.4 LITIGATION SUPPORT. In the event and for so long as any Party
actively is contesting or defending against any action, suit, proceeding,
hearing, investigation, charge,

                                       32
<PAGE>

complaint, claim, or demand by or against a third party (not between the
Parties) in connection with (i) any transaction contemplated under this
Agreement or (ii) any fact, situation, circumstance, status, condition,
activity, practice, plan, occurrence, event, incident, action, failure to act,
or transaction on or prior to the Closing Date involving the Restaurant Assets
or the Restaurant Business, each of the other Parties will cooperate with him or
it and his or its counsel in the contest or defense, make available their
personnel, and provide such testimony and access to their books and records as
shall be necessary in connection with the contest or defense, all at the sole
cost and expense of the contesting or defending Party (unless the contesting or
defending Party is entitled to indemnification therefor under Article 6 below).

         5.5 TEXAS CERTIFICATE OF NO TAX DUE. On or before the expiration of
thirty (30) days after the Closing Date, Seller shall have requested a Texas
Certificate of No Tax Due - Sales and Use Tax, which will show no sales and use
tax due in respect of Seller as of the Closing Date. Seller and the Shareholders
shall cooperate and facilitate any audit or other proceedings incident to the
issuance of such Texas Certificate of No Tax Due - Sales and Use Tax. Seller and
the Shareholders shall deliver a certified copy of such Texas Certificate of No
Tax Due - Sales and Use Tax immediately upon receipt of same.

         5.6 AMENDMENT TO ARTICLES OF INCORPORATION; CHANGE OF NAME. On the
Closing Date, the Seller and the Shareholders shall cause each entity included
within the Seller to amend its articles of incorporation and any certificates of
assumed names, d/b/a's and the like to eliminate the use of the name "Casa Ole,"
"Crazy Jose" and any other similar name.

                                   ARTICLE 6
                        REMEDIES FOR BREACH OF AGREEMENT

         6.1 INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE BUYER. Seller and
each Shareholder (jointly and severally) hereby agree to indemnify and hold
harmless Buyer and Guarantor for all Adverse Consequences incurred, arising out
of, based upon or resulting from (i) the inaccuracy as of the date hereof or as
of the Closing Date of any representation or warranty of the Seller in Section
3.1 or (ii) the breach of, or failure to perform by the Seller of any of its
agreements, covenants or obligations contained in or made pursuant to this
Agreement, or (iii) any liability or obligation of, or claim against Buyer
arising out of, or resulting from any act, or failure to act, by Seller as of
and prior to the Closing Date including without limitation any failure of Seller
to pay its debts or obligations or trade payables (except Assumed Liabilities),
Covered Taxes, any product liability claims, or negligence claims arising prior
to Closing; or (iv) any liability or obligation of, or claim against, Buyer or
Guarantor in connection with any claim, demand or cause of action made by any
person or entity and arising out of any event, directly or indirectly related to
(a) the conduct by Seller or Shareholder's of their business, (b) Adverse
Consequences, or (c) the use or misuse of the Restaurant Assets prior to the
Closing, including but not limited in kind or type, to any claim filed by any
Employee under applicable Worker's Compensation Laws as a result of any injury
or illness covered by such laws that occurs prior to Closing, or any product
liability claim or negligence claim in connection with matters arising prior to
the Closing.

         6.2 INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE SELLER AND
SHAREHOLDERS. Buyer and Guarantor (jointly and severally) hereby agree to
indemnify and hold harmless Seller and Shareholders from any Adverse
Consequences incurred, arising out of, based upon, or resulting from (i) the
inaccuracy as of the date hereof or as of the Closing Date of any representation
or

                                       33
<PAGE>

warranty of the Buyer or Guarantor which is contained in or made pursuant to
this Agreement, (ii) the breach of, or failure to perform by, the Buyer or
Guarantor of any of its respective agreements, covenants or obligations
contained in this Agreement, including but not limited to, the failure by Buyer
or Guarantor to perform and satisfy all Assumed Liabilities, (iii) guaranties by
Seller and Shareholders of Assumed Liabilities, or (iv) any liability or
obligation of, or claim against, Seller or Shareholders in connection with any
claim, demand or cause of action made by any person or entity and arising out of
any event directly or indirectly related to (a) the conduct by Buyer or
Guarantor of their business, (b) Adverse Consequences, or (c) the use or misuse
of the Restaurant Assets subsequent to the Closing, including but not limited in
kind or type to any claim filed by any employee under applicable worker's
compensation laws as a result of any injury or illness covered by such laws that
occurs subsequent to the Closing, or any product liability claim or negligence
claim arising after the Closing.

         6.3 PROCEDURES FOR MATTERS INVOLVING THIRD PARTIES.

                  (a) Notice. The Party (the "Indemnified Party") that may be
         entitled to indemnity hereunder shall give prompt notice to the Party
         obligated to give indemnity hereunder (the "Indemnifying Party") of the
         assertion of any claim, or the commencement of any suit, action or
         proceeding by any third party in respect of which indemnity may be
         sought hereunder. Any failure on the part of any Indemnified Party to
         give the notice described in this Section 6.3 shall relieve the
         Indemnifying Party of its obligations under this Article 6 only to the
         extent that such Indemnifying Party has been prejudiced by the lack of
         timely and adequate notice (except that the Indemnifying Party shall
         not be liable for any expenses incurred by the Indemnified Party during
         the period in which the Indemnified Party failed to give such notice).
         Thereafter, the Indemnified Party shall deliver to the Indemnifying
         Party, promptly (and in any event within 10 days thereof) after the
         Indemnified Party's receipt thereof, copies of all notices and
         documents (including court papers) received by the Indemnified Party
         relating to such claim, action, suit or proceeding.

                  (b) Legal Defense. The Indemnifying Party shall be responsible
         for the defense or settlement of any third-party claim, suit, action or
         proceeding in respect of which indemnity may be sought hereunder,
         provided that (i) the Indemnified Party shall at all times have the
         right, at their option, to participate fully therein, and (ii) if the
         Indemnified Party does not proceed diligently to defend the third-party
         claim, suit, action or proceeding within 10 days after receipt of
         notice of such third-party claim, suit, action or proceeding, the
         Indemnifying Party shall have the right, but not the obligation, to
         undertake the defense of any such third-party claim, suit, action or
         proceeding.

                  (c) Settlement. The Indemnifying Party shall not be required
         to indemnify the Indemnified Party with respect to any amounts paid in
         settlement of any third-party suit, action, proceeding or investigation
         entered into without the written consent of the Indemnifying Party;
         provided, however, that if the Indemnified Party is a Buyer Indemnified
         Party, such third-party claim, suit, action, proceeding or
         investigation may be settled without the consent of the Indemnifying
         Party on 10 days' prior written notice to the Indemnifying Party if
         such third-party suit, action, proceeding or investigation is then
         unreasonably interfering with the business or operations of the Company
         and the settlement is commercially reasonable under the circumstances;
         and provided further, that if the Indemnifying Party gives 10 days'
         prior written notice to the Indemnified Party of a

                                       34
<PAGE>

         settlement offer which the Indemnifying Party desires to accept and to
         pay all Adverse Consequences with respect thereto ("Settlement Notice")
         and the Indemnified Party fails or refuses to consent to such
         settlement within 10 days after delivery of the Settlement Notice to
         the Indemnified Party, and such settlement otherwise complies with the
         provisions of this Section 6.4 the Indemnifying Party shall not be
         liable for Adverse Consequences arising from such third-party claim,
         suit, action, proceeding or investigation in excess of the amount
         proposed in such settlement offer. Notwithstanding the foregoing, no
         Indemnifying Party will consent to the entry of any judgment or enter
         into any settlement without the consent of the Indemnified Party, if
         such judgment or settlement imposes any obligation or liability upon
         the Indemnified Party other than the execution, delivery or approval
         thereof and customary releases of claims with respect to the subject
         matter thereof.

                  (d) Cooperation. The Parties shall cooperate in defending any
         such third-party claim, suit, action, proceeding or investigation, and
         the defending party shall have reasonable access to the books and
         records, and personnel in the possession or control of the Indemnified
         Party that are pertinent to the defense. The Indemnified Party may join
         the Indemnifying Party in any suit, action, claim or proceeding brought
         by a third party, as to which any right of indemnity created by this
         Agreement would or might apply, for the purpose of enforcing any right
         of the indemnity granted to such Indemnified Party pursuant to this
         Agreement.

         6.4 LIMITATION OF REPRESENTATIONS AND WARRANTIES:

                  6.4.1 CONDITION OF THE BUSINESS AND PROPERTY. The term
         "Condition of the Business and Property" means and includes all facts
         and circumstances about the Restaurant Assets and Restaurant Business,
         including without limitation:

                           (a) The quality, nature and adequacy of the physical
                  condition of the Restaurant Assets, including without
                  limitation defects, latent and patent, the presence of
                  hazardous substances, and the mechanical and operating
                  condition of the Restaurant Assets;

                           (b) The merchantability, fitness, suitability and
                  adequacy and fitness of the Restaurant Assets for any
                  particular use or purpose;

                           (c) The development potential, economic feasibility,
                  cash flow, earnings and profits and expenses, and future
                  prospects, of or related to the Restaurant Assets and
                  Restaurant Business being purchased hereunder; and

                           (d) Any and all other aspects relating to the
                  Restaurant Assets and Restaurant Business, including without
                  limitation, the risks associated with this transaction, the
                  competition with businesses competing with the Restaurant
                  Assets and Restaurant Business, the number of customers and
                  clients of Seller's Restaurant Business and all other matters
                  relating to or concerning the Seller's Restaurant Business or
                  the Restaurant Assets.

                                       35
<PAGE>

                  6.4.2 LIMITATION. Other than the express representations and
         warranties made in this Agreement, Seller, Shareholders, Buyer and
         Guarantor hereby agree that Seller and Shareholders make no
         representations or warranties whatsoever, express or implied, with
         respect to Seller's Restaurant Business, the Restaurant Assets or the
         Condition of same. Buyer and Guarantor further represents and warrants
         that Buyer has or will, prior to Closing, independently inspect or
         cause to be inspected on Buyer's behalf Seller's Restaurant Business,
         the Restaurant Assets and every aspect of the Condition of same. Buyer
         and Guarantor have not entered into this Agreement and will not close
         this transaction based upon any representation, warranty, agreement,
         statement or expression of opinion by Seller, by the Shareholders, or
         by any person or entity acting or allegedly acting for or on behalf of
         Seller as to Seller's Restaurant Business, the Restaurant Assets, or
         the Condition of same Buyer and Guarantor agree that Seller's
         Restaurant Business and the Restaurant Assets will be sold and conveyed
         to and accepted by Buyer at the Closing in its then present condition,
         AS IS, WHERE IS, WITH ALL FAULTS AND WITHOUT REPRESENTATIONS OR
         WARRANTIES WHATSOEVER, EXPRESS OR IMPLIED, other than the limited
         special warranty of title to be included in the Special Warranty Deeds
         and Bills of Sale. Buyer and Guarantor represent and warrant to Seller
         and Shareholders that Buyer and Guarantor have knowledge and expertise
         in financial and business matters and in the Restaurant Business that
         enable Buyer and Guarantor to evaluate the merits and risks of the
         transaction contemplated by this Agreement and that Buyer and Guarantor
         are not in a significantly disparate bargaining position. The
         provisions of this Section 6.4 shall survive the Closing or a
         termination of this Agreement and shall continue until terminated as
         provided in Section 7.17.

         6.5 THRESHOLD. The Seller and the Shareholders shall not have any
Liability for Adverse Consequences under this Article 6 until the aggregate of
all Buyer's and Guarantor's claims for Adverse Consequences hereunder exceeds
$50,000.00 and, in such event, Seller and the Shareholder's shall be liable,
retroactively, for the full amount of any and all such damages incurred by Buyer
from such Adverse Consequences.

         6.6 LIMITATION ON LIABILITY. Any and all amounts due to Buyer and
Guarantor as Indemnified Party under this Article 6 for breach of any warranty
or representation made in this Agreement, by Seller or Shareholders, shall be
limited to an aggregate amount of $250,000.00 (the "First Liability Threshold")
during the first six months following the Closing Date (the "First Liability
Period"). During the second six months following the Closing Date (the "Second
Liability Period"), but only if the aggregate amounts paid by Seller and/or by
Shareholders to Buyer under this Section during the First Liability Period ("the
Actual Indemnity Payments") are less than the First Liability Threshold, then
during the Second Liability Period any and all amounts due to Buyer or Guarantor
as Indemnified Party under this Article 6 for breach of any warranty or
representation made in this Agreement, by Seller or Shareholders under Sections
3.1.11 (Properties) or 3.1.15 (Taxes) of this Agreement shall be limited to the
lesser of (i) the difference between the First Liability Threshold and the
Actual Liability Payments or (ii) the sum of $125,000.00. Except for breach of
the restrictive covenants in Section 5.2, Buyer and Guarantor shall have no
right to offset any sum they believe due against the Buyer Notes or Guarantor's
guaranty.

         6.7 MISCELLANEOUS. The provisions of this Agreement, particularly this
Article 6, represent the sole remedy available to any Party hereto for a
misstatement or omission from any representation, or a breach of any warranty or
covenant or agreement contained in this

                                       36
<PAGE>

Agreement, and each Party hereby unconditionally waives any other rights that
they may have at law or in equity for a misstatement or omission from any
representation, or a breach of any warranty or covenant or agreement contained
in this Agreement.

         6.8 SURVIVAL. The provisions of this Article 6 shall survive Closing.

                                   ARTICLE 7
                                  MISCELLANEOUS

         7.1 ENTIRE AGREEMENT. This Agreement (including the documents referred
to herein) constitutes the entire agreement among the Parties and supersedes any
prior understandings, agreements, or representations by or among the Parties,
written or oral, to the extent they related in any way to the subject matter of
this Agreement.

         7.2 NO THIRD-PARTY BENEFICIARIES. This Agreement shall not confer any
rights or remedies upon any Person other than the Parties and their respective
successors and permitted assigns.

         7.3 SUCCESSION AND ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the Parties named herein and their respective successors
and permitted assigns. No Party may assign either this Agreement or any of its
rights, interests, or obligations hereunder without the prior written approval
of the other Party; provided, however, that the Buyer may (i) assign any or all
of its rights and interests hereunder to one or more of its Affiliates and (ii)
designate one or more of its Affiliates to perform its obligations hereunder (in
any or all of which cases the Buyer nonetheless shall remain responsible for the
performance of all of its obligations hereunder), and (iii) collaterally assign
its rights under this Agreement to its source of financing.

         7.4 NOTICES. All notices, requests, demands, claims, and other
communications pertaining to this Agreement ("Notices") must be in writing, must
be sent to the addressee at the address set forth in this Section, or at such
other address as the addressee has designated by a Notice given in the manner
set forth in this Section, and must be sent by facsimile, electronic mail,
courier, or prepaid, certified U.S. mail. Notices will be deemed given (a) when
received, if sent by facsimile or electronic mail, and if received between the
hours of 8:00 a.m. and 5:00 p.m., local time of the destination address, on a
business day (with confirmation of completed transmission sufficing as prima
facie evidence of receipt of a notice sent by facsimile or electronic mail), and
(b) when delivered and receipted for (or when attempted delivery is refused at
the address where sent) if sent by courier or by certified U.S. mail. Notices
sent by facsimile or electronic mail and received between 12:01 a.m. and 7:59
a.m., local time of the destination address, on a business day will be deemed
given at 8:00 a.m. on that same business day. Notices sent by facsimile or
electronic mail and received between the hours of 5:00 p.m. and 12:00 a.m.,
local time of the destination address, on any day will be deemed given at 8:00
a.m. on the next following business day after the day of receipt. The addresses
for Notice are as follows:

<Table>
<S>                                                  <C>
         If to the Buyer or Guarantor:               CASA OLE EAST, INC. OR MEXICAN RESTAURANTS, INC.
                                                     1135 Edgebrook
                                                     Houston, Texas 77034
                                                     Telephone: 713-943-7574
                                                     Fax: 713-943-9554
                                                     Attention:  Andrew Dennard
</Table>

                                       37
<PAGE>

<Table>
<S>                                                  <C>
         Copy to:                                    DiCecco, Fant & Burman
                                                     1900 West Loop South, Suite 1100
                                                     Houston, Texas 77027
                                                     Telephone:  713-961-3366
                                                     Fax:  713-961-3938
                                                     Attention:  Joseph W. DiCecco

         If to the Seller or the Shareholder:        Thomas L. Harken
                                                     4935 Bellechase
                                                     Beaumont, Texas 77706
                                                     Telephone:  409-899-5110
                                                     Fax:  409-899-1322

         Copy to:                                    Orgain, Bell & Tucker, LLP
                                                     470 Orleans St.
                                                     Beaumont, TX  77701
                                                     Telephone:  409-838-6412
                                                     Fax:  409-833-9715
                                                     Attention:  Benny Hughes

                                                     Schlanger, Mills, Mayer & Silver, L.L.P.
                                                     109 North Post Oak Lane, Suite 300
                                                     Houston, Texas 77024
                                                     Telephone:  713-785-1700
                                                     Fax:  713-785-2091
                                                     Attention:  Jack Lapin
</Table>

         7.5 AMENDMENTS AND WAIVERS. No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by the
Buyer and the Seller. No waiver by any Party of any default, misrepresentation,
or breach of warranty or covenant hereunder, whether intentional or not, shall
be deemed to extend to any prior or subsequent default, misrepresentation, or
breach of warranty or covenant hereunder or affect in any way any rights arising
by virtue of any prior or subsequent such occurrence.

         7.6 SEVERABILITY. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction. Whenever possible, each provision of
this Agreement shall be interpreted in such manner as to be effective and valid
under applicable law. A determination that any provision of this Agreement is
unenforceable or invalid shall not affect the enforceability or validity of any
other provision, and any determination that the application of any provision of
this Agreement to any person or circumstance is illegal or unenforceable shall
not affect the enforceability or validity of such provision as it may apply to
any other person or circumstances. If any provision of this

                                       38
<PAGE>

Agreement is held to be illegal, invalid, or unenforceable under present or
future laws effective during the term hereof, such provision shall be fully
severable; and this Agreement shall be construed and enforced as if such
illegal, invalid, or unenforceable provision had never comprised a part hereof;
and the remaining provisions hereof shall remain in full force and effect and
shall not be affected by the illegal, invalid, or unenforceable provision or by
its severance herefrom. Furthermore, in lieu of such illegal, invalid, or
unenforceable provisions there shall be added automatically as a part of this
Agreement a provision as similar in terms to such illegal, invalid, or
unenforceable provision as may be possible and be legal, valid, and enforceable
and that shall not be more restrictive than the one severed herefrom.

         7.7 CONSTRUCTION. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent, or interpretation arises, this Agreement shall be construed
as if drafted jointly by the Parties and no presumption or burden of proof shall
arise favoring or disfavoring any Party by virtue of the authorship of any of
the provisions of this Agreement.

         7.8 INDEPENDENT OBLIGATIONS. The Parties intend that each
representation, warranty, and covenant contained herein shall have independent
significance. If any Party has breached any representation, warranty, or
covenant contained herein in any respect, the fact that there exists another
representation, warranty, or covenant relating to the same subject matter
(regardless of the relative levels of specificity) which the Party has not
breached shall not detract from or mitigate the fact that the Party is in breach
of the first representation, warranty, or covenant.

         7.9 EXPENSES. Each of the Parties will bear its own costs and expenses
(including legal, accountant and consultant fees and expenses and expenses of
inspection) incurred in connection with this Agreement, the inspection of the
Restaurant Assets, and the transactions contemplated by this Agreement, whether
the transaction is consummated or the Agreement is terminated for any reason;
provided, however, that whether the transaction is consummated or not, all costs
related to or in the nature of the Owner's Policy of Title Insurance to be
delivered to Buyer under Section 2.3(n) (including the cost of any surveys
required by the Title Company ), along with all costs incident to the deliveries
contemplated by Section 4.8, shall be borne 50% by the Seller, on the one hand,
and 50% by the Buyer, on the other hand.

         7.10 HEADINGS. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.

         7.11 TIME. Time is of the essence. In computing any period of time
pursuant to this Agreement, the day of the act, event or default from which the
designated period of time begins to run shall not be included, but the time
shall begin to run on the next succeeding day. The last day of the period so
computed shall be included, unless it is a Saturday, Sunday or legal holiday, in
which event the period shall run until the end of the next day which is not a
Saturday, Sunday or legal holiday.

         7.12 LEGAL REPRESENTATION. All of the Parties' acknowledge that they
have been advised that they should seek and have had the opportunity to seek
counsel to review this Agreement and to obtain the advice of such counsel
relating thereto.

                                       39
<PAGE>

         7.13 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.

         7.14 FACSIMILE SIGNATURES. The transmission of an executed copy of this
Agreement, or any document referenced in this Agreement, or the signature
page(s) hereof or thereof, by facsimile or telecopy shall be treated in all
manner and respects as the delivery of an original counterpart of this Agreement
or such document bearing the original signature(s) of the Party (ies) utilizing
any such transmission device. At the request of any Party, any document or
signature page that is subject to this Section, including without limitation to
this Agreement, shall be re-executed and delivered in original form by the
effected Party(ies).

         7.15 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the domestic laws of the State of Texas, and specifically
including but not limited to the Texas Covenants Not to Compete Act (TX Bus &
Com Section 15.50 et seq) without giving effect to any choice or conflict of law
provision or rule (whether of the State of Texas or any other jurisdiction) that
would cause the application of the laws of any jurisdiction other than the State
of Texas. Venue for any cause of action arising under this Agreement shall lie
in Harris County, Texas.

         7.16 DISPUTE RESOLUTION.

                  (a) Any and all disputes among the Parties to this Agreement
         (defined for the purpose of this provision to include their principals,
         partners, agents and/or affiliates) arising out of or in connection
         with the negotiation, execution, interpretation, performance or
         nonperformance of this Agreement, the transactions contemplated herein
         and any other instrument, agreement or certificate delivered in
         connection herewith, shall be solely and finally settled by
         arbitration, which shall be conducted in Houston, Harris County, Texas,
         by a single arbitrator selected by the Parties. The arbitrator shall be
         a lawyer familiar with business transactions of the type contemplated
         in this Agreement who shall not have been previously employed by or
         affiliated with any of the Parties hereto or their respective legal
         counsel. If the Parties fail to agree on the arbitrator within thirty
         (30) days of the date one of them invokes this arbitration provision,
         either Party may apply to the American Arbitration Association to make
         the appointment.

                  (b) The Parties hereby renounce all recourse to litigation as
         to arbitrated matters and agree that the award of the arbitrator shall
         be final and subject to no judicial review. The arbitrator shall
         conduct the proceedings pursuant to the Commercial Arbitration Rules of
         the American Arbitration Association, as now or hereafter amended (the
         "Rules").

                  (c) The arbitrator shall decide the issues submitted (i) in
         accordance with the provisions and commercial purposes of this
         Agreement, and (ii) with all substantive questions of law determined
         under the laws of the State of Texas (without regard to its principles
         of conflicts of laws). The arbitrator shall promptly hear and determine
         (after giving the Parties due notice and a reasonable opportunity to be
         heard) the issues submitted and shall render a decision in writing
         within sixty (60) days after the appointment of the arbitrator.

                                       40
<PAGE>

                  (d) The Parties agree to facilitate the arbitration by (i)
         conducting arbitration hearings to the greatest extent possible on
         successive days, and (ii) observing strictly the time periods
         established by the Rules or by the arbitrator for submission of
         evidence or briefs.

                  (e) Judgment on the award of the arbitrator may be entered in
         any court having jurisdiction over the Party against which enforcement
         of the award is being sought and the Parties hereby irrevocably consent
         to the jurisdiction of any such court for the purpose of enforcing any
         such award. The arbitrator shall divide all costs (other than fees and
         expenses of counsel) incurred in conducting the arbitration in the
         final award in accordance with what the arbitrator deems just and
         equitable under the circumstances.

                  (f) The Parties hereto agree that the provisions of this
         Section 7.16 shall not be construed to prohibit any Party from
         obtaining, in the proper case, specific performance or injunctive
         relief with respect to the enforcement of any covenant or agreement of
         another Party to this Agreement.

         7.17 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. Except as
otherwise specifically provided herein, all of the representations and
warranties of the Parties contained in this Agreement shall survive the Closing
and continue in full force and effect for a period of one (1) year thereafter
unless the Actual Indemnity Payments made by Seller and/or Shareholders to Buyer
during the First Liability Period pursuant to Article 6 equal the First
Liability Threshold, then the representations and warranties of Seller and
Shareholders under Article 3 and its obligations for breach of same under
Article 6 shall terminate on the first day of the Second Liability Period. The
representations and warranties regarding Seller's title to the Restaurant
Assets, subject to Permitted Encumbrances, shall survive the Closing and
continue in full force and effect forever thereafter.

         7.18 SOLICITATION OF EMPLOYEES. Seller and Shareholders, severally and
not jointly, agree that during the Non-Compete Period, Seller and/or
Shareholders will not, directly or indirectly, contact or solicit any person,
excluding employees named on Schedule 7.18, who at any time within the one year
period preceding the Covenant Trigger, has been an employee of the Seller and/or
Shareholders (the "Employee") to become an employee of the Seller and/or
Shareholders, in any Competing Business, or otherwise become engaged in any
capacity on behalf of the Seller and/or Shareholders in any Competing Business.

                                       41

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