8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

________________________________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 27, 2009 (May 22, 2009)

J. ALEXANDER’S CORPORATION

(Exact Name of Registrant as Specified in Charter)

Tennessee	1-08766	62-0854056
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

3401 West End Avenue, Suite 260, P.O. Box 24300, Nashville, Tennessee 37202

(Address of Principal Executive Offices) (Zip Code)

Registrant’s telephone number, including area code:  (615) 269-1900

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01.                      Entry into a Material Definitive Agreement.

The Pinnacle Loan Agreement

On May 22, 2009, J. Alexander’s Corporation (the “Company”) entered into a Loan Agreement by and among the Company as the Borrower, and Pinnacle National Bank (“Pinnacle”) as the Lender (the “Pinnacle Loan Agreement”) that provides for two new credit facilities. The new credit facilities consist of a three-year $5,000,000 revolving line of credit (the “Pinnacle Revolving Loan”), which may be used for general corporate purposes, and a $3,000,000 term loan (the “Pinnacle Term Loan”), which funded the purchase of 808,000 shares of J. Alexander’s Corporation common stock from Solidus Company, L.P. and an affiliate. The term loan is evidenced by that certain Promissory Note for $3,000,000 by the Company as the Borrower in favor of Pinnacle as the Lender (the “Pinnacle Term Promissory Note”). The revolving line of credit replaces the Company’s previous line of credit and is evidenced by that certain Revolving Promissory Note for $5,000,000 by the Company as the Borrower in favor of Pinnacle as the Lender (the “Pinnacle Revolving Promissory Note”). The credit facilities will be secured by liens on certain personal property of the Company and its subsidiaries, subsidiary guaranties and a negative pledge on certain real property.

Amounts borrowed will bear interest at an annual rate of 30-day LIBOR plus an initial margin of 450 basis points, with a minimum interest rate of 4.6%. The loans can be prepaid at any time without penalty. Scheduled term loan payments are interest only for six months and monthly payments of principal plus interest over the remainder of the five-year term.

In addition, the Pinnacle Loan Agreement, among other things, limits capital expenditures, asset sales and liens and encumbrances, prohibits dividends, and contains certain other provisions customarily included in such agreements.

The Pinnacle Loan Agreement also includes certain financial covenants. The Company must maintain a fixed charge coverage ratio of at least 1.05 to 1.00 as of the end of any fiscal quarter. The fixed charge coverage ratio will be measured for the two fiscal quarters ending June 28, 2009, for the three fiscal quarters ending September 27, 2009 and for the four fiscal quarters ending each quarter thereafter. The fixed charge coverage ratio is defined in the Pinnacle Loan Agreement as the ratio of (a) the sum of net income for the applicable period (excluding the effect of any extraordinary or non-recurring gains or losses including any asset impairment charges, deferred income tax benefits and expenses and up to $500,000 (in the aggregate during the term of loan) in uninsured losses) plus depreciation and amortization plus interest expense plus scheduled monthly rent payments plus non-cash FASB 123R items (i.e., stock based compensation) minus certain capital expenditures, to (b) the sum of interest expense during such period plus scheduled monthly rent payments made during such period plus scheduled payments of long term debt made during such period plus scheduled payments of capital leases made during such period, all determined in accordance with generally accepted accounting principles.  In addition, the Company’s adjusted debt to EBITDAR ratio must not exceed 6 to 1 for the four quarters ending June 28, 2009 and September 27, 2009, 5 to 1 for the four quarters ending January 3, 2010 and 4.5 to 1 for each four quarter period thereafter. Under the Pinnacle Loan Agreement, EBITDAR is defined as the sum of net income for the applicable period (excluding the effect of any extraordinary or non-recurring gains or losses including any asset impairment charges, and up to $500,000 (in the aggregate during the term of loan) in uninsured losses) plus an amount which, in the determination of net income for such period has been deducted for (i) interest expense for such period;  (ii) total federal, state, foreign or other income taxes for such period; (iii) all depreciation and amortization for such period; (iv) scheduled monthly rent payments for such period; and (v) non-cash FASB 123R items, all as determined in accordance with generally accepted accounting principles. Adjusted debt is (i) the Company’s debt obligations net of any short term investments, cash or cash equivalents plus (ii) scheduled monthly rent payments multiplied by seven.

If an event of default shall occur and be continuing under the Pinnacle Loan Agreement, the commitments under the Pinnacle Loan Agreement may be terminated and the principal amount outstanding under the Pinnacle Loan Agreement, together with all accrued unpaid interest and other amounts owing in respect thereof, may be declared immediately due and payable.

The foregoing description of the Pinnacle Loan Agreement, the Pinnacle Term Promissory Note and the Pinnacle Revolving Promissory Note does not purport to be complete and is qualified in its entirety by reference to the Pinnacle Loan Agreement, Pinnacle Term Promissory Note and the Pinnacle Revolving Promissory Note, copies of which are filed as Exhibits 10.1 10.2, and 10.3, respectively, to this Current Report on Form 8-K.

The Solidus Stock Purchase Agreement

On May 22, 2009, the Company entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with Solidus Company, L.P. (“Solidus”) to purchase, in aggregate, 808,000 shares of common stock, par value $.05, for $3.60 per share from Solidus and director E. Townes Duncan, who also serves as the president of Solidus’ general partner, Solidus General Partner, LLC (the “Stock Repurchase”). Solidus and Mr. Duncan agreed to limit future dispositions of their J. Alexander’s Corporation stock holdings remaining after the Stock Repurchase to 100,000 shares for the remainder of the 2009 calendar year, 200,000 shares in the 2010 calendar year and up to 100,000 shares from January 1, 2011 until May 22, 2011. The foregoing description of the Stock Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the Stock Purchase Agreement, a copy of which is filed as Exhibit 10.4 to this Current Report on Form 8-K.

Item 1.02.                      Termination of a Material Definitive Agreement.

On May 22, 2009, that certain loan agreement dated May 12, 2003, as amended, between the Company, J. Alexander’s Restaurants, Inc. and Bank of America, N.A (the “Bank of America Loan Agreement”) was terminated by the Company. The Bank of America Loan Agreement provided for a revolving line of credit up to $10,000,000 for general corporate purposes. On the date of termination, there were no amounts outstanding under the Bank of America Loan Agreement.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

The information under Item 1.01 above is incorporated by reference hereunder.

Item 7.01.                      Regulation FD Disclosure.

J. Alexander’s Corporation’s press release announcing the new credit facilities and the repurchase of stock from Solidus Company, L.P. is furnished as Exhibit 99.1.

Item 9.01.                      Financial Statements and Exhibits.

(d)           Exhibits:

The following exhibits are filed or furnished herewith as noted above:

Exhibit Number	Description
10.1	Loan Agreement dated May 22, 2009 between the Company and Pinnacle National Bank.
10.2	Promissory Note dated May 22, 2009 from the Company in favor of Pinnacle National Bank.
10.3	Revolving Promissory Note dated May 22, 2009 from the Company in favor of Pinnacle National Bank.
10.4	Stock Purchase Agreement dated May 22, 2009 between Solidus Company, L.P., E. Townes Duncan and the Company
99.1	Press Release Dated May 22, 2009

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

	J. Alexander’s Corporation
Date: May 27, 2009	By:	/s/ R. GREGORY LEWIS
		R. Gregory Lewis
		Chief Financial Officer, Vice President of Finance and Secretary

EXHIBIT INDEX

Exhibit Number	Description
10.1	Loan Agreement dated May 22, 2009 between the Company and Pinnacle National Bank.
10.2	Promissory Note dated May 22, 2009 from the Company in favor of Pinnacle National Bank.
10.3	Revolving Promissory Note dated May 22, 2009 from the Company in favor of Pinnacle National Bank.
10.4	Stock Purchase Agreement dated May 22, 2009 between Solidus Company, L.P., E. Townes Duncan and the Company
99.1	Press Release Dated May 22, 2009

EX-10

Exhibit 10.1

LOAN AGREEMENT

THIS AGREEMENT (“Loan Agreement”) is made and entered into this 22nd day of May, 2009, by and between J. ALEXANDER’S CORPORATION, a Tennessee corporation (herein called “Borrower”) and PINNACLE NATIONAL BANK (herein called “Lender”).

W I T N E S S E T H:

WHEREAS, Borrower has applied to Lender for financing to acquire certain stock in Borrower from Solidus Company, LP, a Tennessee limited partnership, and for general corporate purposes, including working capital needs, and Lender has agreed to provided such financing, subject to the terms and conditions hereinafter contained.

NOW, THEREFORE, in consideration of the mutual covenants herein contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Lender and Borrower covenant and agree as follows:

I. THE LOANS

1.1           Loans.  Subject to the terms and provisions of this instrument, Lender agrees to make available to Borrower a term loan in the original principal amount of THREE MILLION AND NO/100 ($3,000,000.00) DOLLARS, solely for the purposes specifically enumerated herein and certain costs and expenses related thereto, by advancing said sum to Borrower on the date hereof pursuant to the provisions herein contained (the "Term Loan"). The Term Loan shall be evidenced by a certain Promissory Note in the original principal amount of $3,000,000.00, in form and content acceptable to Lender, which shall be executed by Borrower and payable to the order of Lender (together with any and all extensions, renewals and modifications thereof, the "Term Note").  In addition, subject to the terms and provisions of this instrument, Lender also agrees to make available to Borrower a revolving line of credit in the maximum principal amount of FIVE MILLION AND N0/100 ($5,000,000.00) DOLLARS, to be used for general corporate purposes, including working capital needs of Borrower and its subsidiaries, by advancing said sum to Borrower on a revolving basis from time to time at Borrower's request pursuant to the provisions herein contained (the "Line of Credit;" the Term Loan and the Line of Credit are sometimes hereinafter collectively referred to as the "Loans").  The Line of Credit shall be evidenced by a certain Revolving Promissory Note in the maximum principal amount of $5,000,000.00, in form and content acceptable to Lender, which shall be executed by Borrower and payable to the order of Lender (together with any and all extensions, renewals and modifications thereof, the "Revolving Note").  The Term Note and the Revolving Note are hereinafter collectively referred to as the “Notes.”

J. Alexander's Restaurants, Inc., J. Alexander's Restaurants of Kansas, Inc., J. Alexander's of Texas, Inc. and J. Alexander's of Kansas, LLC (herein collectively called “Guarantors”), shall unconditionally guarantee payment of the Loans, and all indebtedness now or hereafter owing to Lender by Borrower, and shall execute instruments in such form as may be reasonably required by Lender to accomplish such guaranties.

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1.2           Term.  The term of the Loans shall be as set forth in the Notes and this Loan Agreement.

1.3           Interest.  The Loans shall bear interest at annual rates as set forth in the Notes. Interest accruing under the Notes shall be computed on the basis of a three hundred sixty (360) day year. After default or maturity, interest and penalties shall accrue as set forth in the Notes and this Loan Agreement. Notwithstanding anything herein to the contrary, in no event shall the interest rate exceed the maximum rate allowed by applicable law.  The Applicable Margin, as such term is used in the Notes, shall be determined in accordance with the following pricing grid (with the Adjusted Debt to EBITDAR Ratio calculated in accordance with Section 3.5(b) of this Loan Agreement):

Tier	Adjusted Debt to EBITDAR Ratio	Applicable Margin
I	Less than or equal to 3.0 to 1.0	3.50%
II	Greater than 3.0 to 1.0 and less than or equal to 4.5 to 1.0	4.00%
III	Greater than 4.5 to 1.0 and less than or equal to 6.0 to 1.0	4.25%
IV	Greater than 6.0 to 1.0	4.50%

Adjustments to the Applicable Margin shall be made quarterly, effective two (2) business days after delivery by Borrower to Lender of its financial covenant calculations for the applicable fiscal quarter; provided, however, the Applicable Margin shall be determined with reference to Tier IV until delivery by Borrower of financial covenant calculations for the fiscal quarter ending June 28, 2009.

1.4           Repayment Schedule.  Payment of all obligations arising under the Loans shall be made as set forth in the Notes and this Loan Agreement.

1.5           Commitment Fees; Non-Use Fee.   At closing hereunder, Borrower shall pay to Lender an upfront commitment fee equal to 0.50% of the maximum principal amount to the Loans, payable in full in cash at closing.  On each anniversary of the closing hereunder until the termination of the Line of Credit, Borrower shall pay to Lender an annual commitment fee equal to 0.50% of the maximum principal amount of the Line of Credit.  Borrower shall pay to Lender an unused fee equal to 0.25% per annum of the average, unused portion of the Line of Credit until the termination of the Line of Credit, payable quarterly, in arrears.

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1.6           Place of Payments.  All payments of principal and interest shall be made at 211 Commerce Street, Suite 300, Nashville, Tennessee 37201, or at such other place, or places, as Lender may direct by notice in writing to Borrower from time to time.

1.7           Prepayment. 

(a)           Prepayment. Prepayment of principal due under the Loans made hereunder may be made at any time without premium or other prepayment charge.

(b)           Mandatory Prepayment. In addition to regularly scheduled payments of principal, Borrower will be required to make prepayments of the Loans to the extent the following exceed an aggregate amount of $100,000 in any calendar year (i) 100% of the net proceeds of any sale or disposition of any assets of Borrower or Guarantors (net of amounts reinvested in replacement assets within 180 days of receipt by Borrower or required to pay taxes or other costs applicable to the disposition), other than from the sale of inventory and gift cards in the ordinary course of business (provided, however, at any time that the Adjusted Debt to EBITDAR Ratio is less than 1.5 to 1.0, no prepayment under clause (i) is required); (ii) 50% of the net proceeds of any sales or issuances of equity (other than proceeds from the exercise of stock options) or debt securities of Borrower or Guarantors and/or any other indebtedness for borrowed money incurred by Borrower or Guarantors after the closing date (other than purchase money indebtedness); and (iii) 100% of the net proceeds of insurance proceeds and condemnation awards of the Borrower and Guarantors to the extent not reinvested in their business, and not required by contract to be paid to another vendor or landlord.  Such prepayments shall be applied first to installments of principal of the Term Loan on until the Term Loan is paid in full and second to the outstanding principal balance of the Line of Credit (without a permanent reduction in the maximum principal amount of the Line of Credit).

(c)           Excess Cash Flow Recapture.  An annual additional principal payment on the Term Loan is to be made by Borrower based on fiscal year-end Fixed Charge Coverage Ratio beginning with the fiscal year ending January 2, 2011.  The additional required principal payments shall be equal to 65% of the excess of the numerator of the Fixed Charge Coverage Ratio over 105% the denominator of the ratio.

1.8           Disbursement of Loans.  Funds shall be disbursed by Lender under the Notes for the purposes provided herein (with the Term Loan disbursed in full at closing and the Line of Credit disbursed on a revolving basis from time to time at Borrower's request), subject to and in accordance with the conditions and requirements contained herein, as follows:

(a)           Lender shall not be obligated to disburse any portion of the Loans other than closing costs of the Loans approved by Lender, unless and until, at Lender’s option, the following conditions precedent shall have been satisfied:

(i)           Lender shall have received all of the Loan Documents and Security Instruments, as hereinafter defined, in form reasonably satisfactory to Lender.

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(ii)           Borrower and Guarantors shall provide to Lender certified resolutions appropriately authorizing the transactions contemplated herein and designating an authorized officer or other agent of Borrower to execute all Loan Documents to which Borrower is a party.

(iii)           Lender shall have received financing statements in form acceptable to Lender to be filed with the Secretary of State of Tennessee, and such other locations as Lender may reasonably require, perfecting Bank’s security interest in the Collateral (as hereinafter defined), and any waivers or releases reasonably required by Lender.

(iv)           Lender shall have received a copy of certified articles of organization and certificates of existence of Borrower and Guarantors from the Tennessee Secretary of State and/or such other jurisdictions as Lender may reasonably require, together with copies of the bylaws of Borrower and each corporate Guarantor.

(v)           UCC-11 searches issued by the Secretary of State of Tennessee and such other jurisdictions as Lender may reasonably require.

(vi)           Borrower shall be in material compliance with all covenants, warranties and representations to which Borrower is obligated under this Loan Agreement.

(vii)           No Event of Default shall then be in existence hereunder.

(viii)                      Borrower shall have furnished to Lender a detailed list of all of the corporate entities owned by Borrower, with evidence of any indebtedness currently outstanding with Borrower and/or Guarantors.

(ix)           Borrower shall have furnished to Lender any and all releases regarding any outstanding indebtedness owed to any lender that is to be paid off, or that said lender(s) shall be required to release any lien on an encumbrance they may have on any and all of the assets of Borrower or Guarantors, except for Permitted Encumbrances (as hereinafter defined).

(x)           Within ten (10) days of the date hereof (and not as a condition to the initial funding of the Loans), Borrower and Guarantors shall furnish to Lender negative pledges on all real property owned by Borrower and Guarantors not currently pledged to GE Capital, in which Borrower and Guarantors agree not to pledge the properties therein described to any lender or any other entity without Lender’s written permission; provided, however, Borrower and Guarantors shall be permitted to sell up to two (2) restaurant properties during the term of the Loans, so long as the net proceeds are applied in accordance with Section 1.7(b) of this Agreement.  Additionally, Borrower and Guarantors shall provide to Lender an affirmative statement that no other entity shall be granted a negative pledge on said property without first obtaining Lender’s written permission, all of which shall be set forth in this Loan Agreement.

Interest shall accrue on sums advanced only from the date of disbursement of such sums.

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1.9           Collateral.  As collateral for the Secured Obligations, as hereinafter defined, including the Loans, Borrower shall execute and deliver, or cause to be executed and delivered, the following prior to or at closing hereunder:

(a)           Lender, shall receive a first priority (except for Permitted Encumbrances) perfected security interest in substantially all existing and after-acquired personal property of Borrower and Guarantors, including all inventory, accounts, equipment, fixtures, chattel paper, patents, trademarks, copyrights, documents, instruments, deposit accounts (provided, deposit account control agreements shall not be required), cash and cash equivalents, investment property (excluding equity interests of non-guarantor subsidiaries), general intangibles, letter of credit rights, commercial tort claims, insurance policies and other personal property of the Borrower and Guarantors (the “Collateral”).  The Collateral will be free and clear of other liens, claims and encumbrances, except Permitted Encumbrances.  As used herein "Permitted Encumbrances" shall mean (i) liens in favor of Lender, (ii) liens securing purchase money indebtedness or capital lease obligations, and (iii) liens for taxes not yet delinquent or being contested in good faith.

(b)           Assignment and Security Agreement, assigning and granting a security interest to Lender in all items therein described and other rights and matters as provided therein arising from or with respect to the Collateral, together with Financing Statements to evidence and perfect such assignment and security interest, all of which shall be in form and substance reasonably satisfactory to Lender in all respects, and which shall be first priority encumbrances upon the property, rights and interests which are the subject of such Assignment and Security Agreement and Financing Statements (subject to Permitted Encumbrances).

(c)           Guaranties of the Guarantors, in form and substance reasonably satisfactory to Lender executed by the Guarantors.

The foregoing instruments and documents, and any other instruments and documents now or hereafter securing the Secured Obligations, are herein sometimes collectively called the “Security Instruments.” The Security Instruments, together with the Notes, this Loan Agreement, and any other instruments and documents now or hereafter evidencing, securing or regulating the Loans or Secured Obligations are herein sometimes collectively called the “Loan Documents.”

Without limiting any of the provisions thereof, the Security Instruments shall secure the following (the “Secured Obligations”):

(a)           The full  and  timely  payment  of  the  indebtedness evidenced by the Notes, together with interest thereon, and all extensions, modifications and renewals thereof.

(b)           The full and prompt performance of all the obligations of Borrower to Lender under the Loan Documents.

(c)           The full and prompt payment of all costs and expenses of whatever kind or nature incident to the collection of any indebtedness evidenced by the Notes, the enforcement or protection of the Security Instruments, or the exercise by Lender or any rights or remedies of Lender with respect to any indebtedness evidenced by the Notes, including but not limited to reasonable attorney fees incurred by Lender in connection therewith, all of which Borrower agrees to pay upon demand.

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(d)           The full and prompt payment and performance of any and all other indebtedness and obligations of Borrower to Lender, whether direct, indirect, contingent or matured, and whether incurred as endorser, guarantor, maker, surety or otherwise, whether now existing or hereafter arising.

1.10           Further Documents and Actions.  Borrower, and any other necessary parties, shall execute such instruments as Lender may reasonably require from time to time (which shall be in such form and substance as Lender may reasonably require), and shall take such other actions as Lender may reasonably require from time to time, to assure the full realization by Lender of the security of all the Collateral.

II. REPRESENTATIONS AND WARRANTIES

Borrower represents and warrants to Lender as follows:

(a)            Neither this Loan Agreement, nor any document, financial statement, report, notice, schedule, certificate, statement or other writing which has, or shall be, furnished to Lender by or on behalf of Borrower hereunder contains any untrue statement of a material fact, or omits to state a fact material to this Loan Agreement, or the Loans to be made hereunder.

(b)           Borrower has full power and authority to consummate the transactions contemplated hereby.

(c)           Borrower and each Guarantor has, and shall have, the authority and capacity to execute and deliver the Loan Documents to which it is a party.

(d)           As of the date hereof, there is no default, under any instrument or document to which Borrower or any Guarantor is a party, which default is reasonably likely to cause a material adverse effect upon Borrower and Guarantors' financial condition taken as a whole (a "Material Adverse Effect"). Neither the execution nor delivery of this Loan Agreement, or any of the Loan Documents, nor compliance with their terms and provisions, will conflict with or be in violation of any applicable law, regulation, ordinance, court order, injunction, writ, or decree which conflict is reasonably likely to result in a Material Adverse Effect.

(e)           As of the date hereof and except as disclosed in Borrower's SEC filings, there is no pending or, to Borrower’s knowledge, threatened judicial, administrative, or arbitrational action or proceeding affecting Borrower, or any Guarantor before any court, governmental agency, or arbitrator which relates in any adverse manner to any of the transactions contemplated by this Loan Agreement, or which if adversely determined, is reasonably likely to result in a Material Adverse Effect.  Neither Borrower, nor any Guarantor has any material contingent liability not disclosed in the financial information heretofore furnished to Lender.

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(f)           The funds disbursed under the Loans to be made hereunder shall be used for no purpose other than as stated above.

(g)           The financial statements which have been heretofore delivered to Lender by or on behalf of Borrower and Guarantors, and all financial statements which shall be delivered hereunder by Borrower or Guarantors, or such parties, to Lender, during the term of this Loan Agreement, and until payment of the Loans made hereunder, have been and shall be prepared in accordance with general accepted accounting principles, consistently applied ("GAAP"), and fairly present, and shall fairly present, in all material respects, the financial condition and results of operations of the Borrower as of and for the periods represented.

(j)           Borrower is a Tennessee corporation, validly existing, and in good standing under the laws of the State of Tennessee and has the power to own its properties, to carry on its business as now conducted, and to enter into and perform its obligations under this Loan Agreement and the other Loan Documents.  Borrower is duly qualified to do business and in good standing in any other state in which a failure to be so qualified could reasonably be expected to have a Material Adverse Effect. The parties executing the Loan Documents on behalf of Borrower are duly authorized to act on its behalf.

(k)           Guarantors are validly existing and in good standing under the laws of the states of their organization and have the power to guarantee the indebtedness contemplated hereby, to carry on business as now conducted, and to enter into and perform obligations under this instrument and the other Loan Documents.  Guarantors are duly qualified to do business and in good standing in any other state in which a failure to be so qualified could reasonably be expected to have a Material Adverse Effect. The parties executing the Loan Documents on behalf of Guarantors are duly authorized to act on behalf of Guarantors.

(l)           Borrower’s principal office and chief place of business is located at 3401 West End Avenue, Suite 260, Nashville, Tennessee 37203.  Borrower will give Lender thirty (30) days notice of any change in its principal office or chief place of business.

III. COVENANTS OF BORROWER

3.1           Loan Documents.  Borrower and Guarantors shall execute and deliver, or cause to be executed and delivered, to Lender for the Loans to be made hereunder, prior to disbursement thereof, all of the Loan Documents, including but not limited to this Loan Agreement, the Notes and Security Instruments, all in form and substance reasonably satisfactory to Lender in all respects.

3.2           Additional Documentation.  Borrower shall deliver to Lender charters, bylaws, certifications, affidavits, good standing certificates, resolutions, opinions of counsel, and such other documentation as may be reasonably necessary in Lender’s judgment, to authorize the execution and delivery of any of the Loan Documents or to carry out the provisions of this Loan Agreement.

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3.3           Liens.    Borrower shall for the term of this Loan Agreement, and until payment of the Loans made hereunder, keep the Collateral free and clear of any and all liens except Permitted Encumbrances and shall pay all taxes (if any) which may be charged against any part or all of the Collateral, prior to the time such become delinquent. However, Borrower shall not be required to pay any such lien claim, tax or assessment deemed by Borrower to be excessive or invalid, or which may be otherwise contested by Borrower, for so long as Borrower shall in good faith object to or otherwise contest the validity of the same by appropriate legal proceeding, and provided further that Borrower, upon demand by Lender, as protection and indemnity against loss or damage resulting therefrom, shall deposit, either in cash, bond, or other collateral acceptable to Lender, an amount sufficient in Lender’s reasonable judgment to cover the claim for such unpaid amounts, together with any costs or penalties which may thereafter accrue. Borrower shall pay, in any event, any such items prior to any judicial or nonjudicial sale to enforce any such lien.

3.4           Financial Statements and Other Information.  Borrower shall provide Lender with quarterly consolidated financial statements and a quarterly loan covenant compliance report within 45 days from the end of the first three (3) fiscal quarters of each fiscal year.  Borrower shall also provide Lender with an annual audited financial statement and a loan covenant compliance report within 120 days of Borrower’s fiscal year-end.

3.5           Financial Covenants.  Financial covenants will be calculated on a trailing four quarters basis (except as set forth below) and will consist of:

(a)           Fixed Charge Coverage Ratio. Borrower shall maintain a Fixed Charge Coverage Ratio of not less than 1.05 to 1.0.  Fixed Charge Coverage Ratio shall be measured as of the end of each of Borrower's fiscal quarters beginning June 28, 2009, and shall be calculated as of June 28, 2009 for the then-ending two (2) fiscal quarters, as of September 27, 2009, for the then-ending three (3) fiscal quarters, and as of the end of each fiscal quarter thereafter for the then-ending four (4) fiscal quarters. Fixed Charge Coverage Ratio shall be defined as the ratio of (A) the sum of net income (excluding the effect of any extraordinary or non-recurring gains or losses including any asset impairment charges, changes in valuation allowance for deferred tax assets and non-cash deferred income tax benefits and expenses and up to $500,000 (in the aggregate for the term of the Loans) in uninsured losses) plus depreciation and amortization plus interest expense plus scheduled monthly rent payments plus non-cash FASB 123R items (i.e. stock based compensation) minus the greater of i) actual total store maintenance capital expenditures (excluding major remodeling or image enhancements), or ii) the total number of Borrower’s stores operating for at least 18 months as of the date of determination multiplied by $40,000, to (B) the sum of interest expense during such period plus scheduled monthly rent payments made during such period plus scheduled payments of long term debt made during such period plus scheduled payments of capital leases made during such period, all determined in accordance with GAAP.

In the event of a full repayment of the Term Loan on or before the delivery of Borrower's loan covenant compliance report with respect to a particular fiscal quarter, all payments of long term debt related to the Term Loan will be excluded from the denominator of the Fixed Charge Coverage Ratio for such fiscal quarter covenant testing and thereafter. Any voluntary or mandatory partial pre-payments of the Term Loan or Line of Credit by Borrower, however, will not reduce (or be included in) scheduled payments of long term debt for purposes of calculating the Fixed Charge Coverage Ratio covenant testing.

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(b)           Adjusted Debt to EBITDAR Ratio.  Borrower shall maintain an Adjusted Debt to EBITDAR Ratio of not more than (i) 6.0 to 1.0 for the fiscal quarters ending June 28, 2009, and September 27, 2009, (ii) 5.0 to 1.0 for the fiscal quarter ending January 3, 2010, and (iii) 4.5 to 1.0 as of the end of each fiscal quarter thereafter.  Adjusted Debt to EBITDAR shall be measured at quarter-end based on then-ending four (4) fiscal quarters. Maximum Adjusted Debt to EBITDAR is defined as the ratio of (A) total funded debt (defined as the principal portion of indebtedness for borrowed money) minus invested funds plus rent payments multiplied by 7, to (B) EBITDAR. Invested funds is defined as short term, liquid investments such as money markets with maturities of less than one year in length, and cash and cash equivalents; provided that investments into any joint venture or any endeavor not consistent with Borrower’s core restaurant operating business without the consent of Lender shall be excluded. EBITDAR shall be defined as the sum of net income for such period  (excluding the effect of any extraordinary or non-recurring gains or losses including any asset impairment charges, and up to $500,000 (in the aggregate for the term of the Loans) in uninsured losses) plus an amount which, in the determination of net income for such period has been deducted for (i) interest expense for such period; (ii) total federal, state foreign or other income taxes for such period; (iii) all depreciation and amortization for such period; (iv) scheduled monthly rent payments made during such period; and non-cash FASB 123R items, (i.e., stock based compensation), all as determined with GAAP.

3.6           Notice of Claims.  Borrower shall promptly notify Lender of any litigation exceeding $500,000 by any third party which may arise with respect to the Collateral, whether or not covered by insurance.

3.7           Insurance.  If such insurance is obtainable, Borrower shall furnish to Lender insurance policies with companies, and coverage and amounts, reasonably satisfactory to Lender insuring the Collateral against loss or damage by fire and other casualty, and such other risks as may be reasonably requested by Lender, said policies to insure the full replacement cost of such Collateral. Each such policy shall be maintained in full force and effect until the Loans have been paid in full.

3.8           Ownership of Collateral.  Except as set forth herein and the other Loan Documents, Borrower shall at all times until final payment of the Loans be the true and lawful owner of all the Collateral.

3.9           Assignments and Participations.  Lender will have the right at any time to sell and assign interests in the loans in accordance with customary terms, including prior consent of the Borrower (not to be unreasonably withheld), which consent shall not be required if any Event of Default exists.

3.10           Capital Expenditures.  Borrower agrees to avoid any expansion capital expenditures for new restaurants until the Term Loan is repaid in full.

3.11           Deposit Accounts.  Beginning ninety (90) days after the date hereof, Borrower agrees to maintain its primary depository accounts, treasury management accounts and merchant card services with Lender, as long as such accounts and merchant card services reasonably meet Borrower's needs and can be provided on terms no less favorable than those currently available to Borrower.

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3.12           Dividends.  Borrower shall be prohibited from issuing or declaring dividends until the Loans are fully repaid or expired.

V. EVENTS OF DEFAULT

Each of the following shall constitute an Event of Default hereunder:

(a)           If Borrower shall fail to pay any installment under the Loans within five (5) days of when due; or

(b)           If Borrower shall fail to pay sums due under the Loans at maturity; or

(c)           If Borrower or any of the Guarantors shall fail to keep and perform any other covenant or provision contained in this Loan Agreement, or in any of the Loan Documents, or if at any time any representation or warranty made by Borrower or any of the Guarantors, herein or otherwise in connection with the Loans made hereunder, shall be materially incorrect, and such failure shall continue unremedied for a period of thirty (30) days following the earlier of the date an executive officer of Borrower first has actual knowledge of such breach or failure, or the date Borrower is given written notice from Lender to Borrower specifying such breach or failure. If such failure cannot be cured by Borrower with reasonable diligence within such thirty (30) day period, then such period shall be extended to a total of forty-five (45) days provided that within such thirty (30) day period Borrower shall commence to cure such breach or failure and shall continue to proceed thereafter with reasonable diligence; or

(d)           If Borrower or any of the Guarantors (i) shall generally not pay or shall be unable to pay its or their debts as such debts become due; or (ii) shall make a general assignment for the benefit of creditors or petition or apply to any tribunal for the appointment of a custodian, receiver or trustee for such party, the Collateral or a substantial part of such party’s assets; or (iii) shall commence any proceeding under bankruptcy, reorganization, arrangement, readjustment of debt, dissolution or liquidation law or statute of any jurisdiction, whether now or hereafter in effect; or (iv) shall have had any petition or application filed or commenced against it or them in which an order for relief is entered or an adjudication or appointment is made; or (v) shall indicate, by any act or omission, such party’s consent to, approval of or acquiescence in any such petition, application, proceeding, or order for relief or the appointment of a custodian, receiver or trustee for such party, the Collateral or a substantial part of such party’s assets; or (vi) shall suffer any custodianship, receivership or trusteeship to continue undischarged for a period of thirty (30) days or more; or

(e)           If Borrower or any of the Guarantors shall be liquidated or dissolved (provided, however, any Guarantor may be liquidated, dissolved or merged into another Guarantor or Borrower); or

(f)           If there is a default in any other material indebtedness or obligations now or hereafter owing by Borrower or Guarantors, to Lender.

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In any such event, Lender may, in addition to all  remedies available to Lender under the terms of any of the Loan Documents, or otherwise by applicable law, take any or all of the following actions, concurrently or successively: (i) declare the indebtedness evidenced by the Notes delivered pursuant to this Loan Agreement to be immediately due and payable without presentment, demand, or other notice, all of which are expressly waived, unless notice is specifically provided herein, or elsewhere in the Loan Documents, (ii) terminate the obligation of Lender to extend credit of any kind hereunder, whereupon the obligation of Lender to make additional advances hereunder shall terminate, (iii) acquire possession of the Collateral.

Borrower shall be liable to Lender for all sums paid or expended by Lender in connection with the Collateral or otherwise in connection with this Loan Agreement, and all payments made or liabilities incurred by Lender hereunder, of any kind whatsoever, shall be payable upon demand, and all of the foregoing, shall be deemed to constitute advances under this Loan Agreement, and the Notes, and shall be additional indebtedness secured by the Security Instruments.

VI. GENERAL PROVISIONS

6.1           Setoff.    In addition to all rights of setoff, Lender shall have upon the occurrence of an Event of Default hereunder the right to appropriate and apply to the payment of the Loans outstanding hereunder, any and all balances, credits, deposits, accounts, money, or other property of Borrower or Guarantors then or thereafter held by or deposited with Lender.

6.2           Attorney Fees and Costs.  Borrower shall be liable to Lender for all sums reasonably paid or incurred by Lender in connection with this Loan Agreement, the Loans made hereunder, the Collateral, whether paid or incurred by reason of any default hereunder, or in any of the Loan Documents, or otherwise, and such shall include, but shall not be limited to, the payment of all reasonable attorneys’ fees so paid or incurred. All such sums shall be payable by Borrower to Lender upon demand, and all of the foregoing shall constitute advances under this Loan Agreement. Borrower shall further pay to Lender all costs and expenses incurred by Lender, including, but not limited to, reasonable attorneys’ fees, in the preparation and consummation of this Loan Agreement, and the Loans made hereunder.

6.3           Remedies Cumulative.  All remedies provided for in this Loan Agreement, or in any of the Loan Documents, shall be cumulative, and shall be in addition to all other remedies available to Lender by applicable law.

6.4           Inspection.   Upon reasonable prior notice, Lender, its representatives and designees, shall have reasonable access to the books and records of Borrower with respect to the Collateral, and shall be entitled to copies of such records upon request. Borrower shall make such books and records available to Lender upon reasonable request. Upon reasonable prior notice, Lender shall be entitled to access to the Collateral for the purpose of inspecting the same, and in order to otherwise carry out the provisions of this Loan Agreement, or of any of the Loan Documents.

6.5           No Waiver.  The failure of Lender to exercise any right or remedy granted under this Loan Agreement, any of the Loan Documents, or by applicable law, shall not be a waiver of Lender’s right or rights to exercise any such right or remedy upon any subsequent default.

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        6.6           Captions.  Captions used herein are for convenience only, and shall not be construed as limiting the construction of the provisions of this Loan Agreement.

6.7           Notice.  Any and all notices permitted or required under this Loan Agreement, or any of the Loan Documents, shall be deemed given if hand-delivered, or mailed by United States registered or certified mail, postage prepaid, return receipt requested, to the following addresses:

If to Borrower, as follows:	J. Alexander’s Corporation
	Attn:  R. Gregory Lewis
	3401 West End Avenue, Suite 260
	Nashville, Tennessee 37203
with a copy to:	Bass, Berry & Sims PLC
	Attn:  Felix R. Dowsley, III
	315 Deaderick Street, Suite 2700
	Nashville, TN  37238
and in the case of Lender:	Pinnacle National Bank
	Attn:  William W. DeCamp, Senior Vice President
	211 Commerce Street, Suite 300
	Nashville, Tennessee 37201
with a copy to:	Gullett, Sanford, Robinson & Martin PLLC
	Attn:  George V. Crawford, Jr
	315 Deaderick Street, Suite 1100
	Nashville, TN  37238

or to such other address, or addresses, as either party may request in writing to the other from time to time. No notice to or demand on Borrower hereunder, in itself shall entitle Borrower to any other or further notice or demand in similar or other circumstances, or shall constitute a waiver of the rights of Lender to any other or further action in any circumstances without notice or demand.

6.8           Interest.  Notwithstanding anything herein to the contrary, in no event shall interest charged under the Loans hereunder exceed the maximum rate allowed by applicable law. Interest shall be calculated on the basis of a three hundred sixty (360) day year.

6.9           No Liability.  Except to the extent caused by Lender's negligence or willful misconduct, Borrower shall indemnify and hold harmless Lender from and against any and all liability, loss, and damage incurred by Lender in connection with this Loan Agreement.

6.10           Successors and Assigns.    This Loan Agreement shall be binding upon the parties hereto, and their respective successors and assigns. However, no rights of Borrower hereunder may be assigned without the express prior written consent of Lender.

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6.11           Severability.   The invalidity or unenforceability of any provision hereof shall not affect the validity or enforceability of the remaining provisions.

6.12           Entire Agreement, Amendment.  This Loan Agreement, and the Loan Documents executed pursuant hereto shall constitute the entire agreement of the parties. Any additional provisions contained in the Loan Documents not contained herein shall be supplemental and in addition to the provisions hereof. This Loan Agreement may be modified or amended only by an instrument in writing executed by all parties hereto.

6.13           Applicable Law.  The construction and validity of this Loan Agreement, and the Loans made hereunder, shall be governed by the law of the State of Tennessee, except to the extent that such may be pre-empted by applicable law or regulation of the United States of America governing the charging or receiving of interest.

6.14           Time of the Essence, Gender, Number.  Time is of the essence with respect to this Loan Agreement, and all provisions and obligations hereof. As used herein, the singular shall refer to the plural, the plural to the singular, and the use of any gender shall be applicable to all genders.

6.15           Further Assurances.  Borrower shall execute and deliver such additional instruments and documents and take such further actions, as may be reasonably requested by Lender from time to time to further evidence or perfect the rights of and obligations owing to Lender hereunder and to correct any errors or mistakes in the transactions evidenced hereby.

6.16           Counterparts.  This Loan Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument.

[Remainder of Page Intentionally Left Blank]

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

BORROWER:

J. ALEXANDER’S CORPORATION,

a Tennessee corporation

By:	/s/ R. Gregory Lewis
Name:	R. Gregory Lewis
Title:	Vice President of Finance, Chief
	Financial Officer and Secretary

LENDER:

PINNACLE NATIONAL BANK

By:	/s/ William W. DeCamp
	William W. DeCamp, Senior Vice President

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EX-10

EXHIBIT 10.2

PROMISSORY NOTE

$3,000,000.00  May 22, 2009 Nashville, Tennessee

FOR VALUE RECEIVED, the undersigned, J. ALEXANDER’S CORPORATION, a Tennessee corporation (“Borrower”), promises to pay to the order of PINNACLE NATIONAL BANK (“Lender”), in lawful currency of the United States of America, at its principal office in Nashville, Tennessee, or at such other place as the holder from time to time may designate in writing, the principal sum of THREE MILLION AND NO/100 ($3,000,000.00) DOLLARS, together with interest thereon computed on the unpaid principal balance from the date of disbursement hereunder at an annual rate equal to LIBOR (as hereinafter defined) plus the Applicable Margin, as defined in the Loan Agreement (as hereinafter defined).  As used herein, “LIBOR” shall mean the London Interbank Offered Rate for one (1) month as published in The Wall Street Journal, which is the British Bankers’ Association average of interbank offered rates for dollar deposits in the London market on the date of this instrument, or if such date is not a publication date, on the next preceding publication date; provided, however, in no event shall the interest payable hereunder be less than 4.60% per annum. The interest rate shall be automatically adjusted on the tenth (10th) day of each month after execution hereof until the Maturity Date, as hereinafter defined, unless earlier accelerated, to the interest rate so calculated and in effect on such date, or the next preceding date for which the LIBOR rate is published, if no rate is published on such date.

Interest shall be calculated on the basis of a three hundred sixty (360) day year.  Principal and interest shall be payable as follows:

(a)            Commencing on June 22, 2009, and for the next six (6) months on the 22nd day for each month, interest only shall due and payable on the outstanding principal balance.

(b)            Commencing on December 22, 2009 and for the next fifty three (53) months, principal payments of $55,555.56 plus interest shall be due and payable.

(c)            The entire unpaid principal and all accrued interest and other charges shall be due and payable on May 22, 2014 (the “Maturity Date”).

The indebtedness evidenced hereby, and all extensions, modifications and renewals thereof, is secured by an Assignment and Security Agreement of even date herewith, and certain additional security documents (the “Security Instruments”).

The whole of the principal sum and, to the extent permitted by law, any accrued interest, shall bear, after default or maturity, interest at the lesser of (i) the highest lawful rate then in effect pursuant to applicable law, or (ii) the rate that is four percentage points (4%) in excess of the LIBOR, as it varies from time to time.

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Sums shall be advanced hereunder subject to, and in accordance with, the conditions and other requirements contained in the Loan Agreement of even date herewith executed between Borrower and Lender (the “Loan Agreement”).

Principal under this Note may be prepaid at any time without premium or other prepayment charge.  It is understood, however, that there are certain mandatory prepayment provisions which apply to this Note and are set forth in the Loan Agreement.

Upon the occurrence of an Event of Default (as defined in the Loan Agreement), then at the election of the legal holder hereof, at any time thereafter made and without demand or notice, the owner and holder of this Note shall have the right to declare all sums unpaid hereon at once due and payable. In the event of such Event of Default, and the same is placed in the hands of an attorney for collection, or a suit is filed hereon, or if the proceedings are held in bankruptcy, receivership, or the reorganization of Borrower, or any guarantor or surety of Borrower, or other legal or judicial proceedings for the collection hereof, Borrower agrees to pay in addition to the owner and holder of this Note, all costs of collection, including reasonable attorneys’ fees.

Borrower expressly waives presentment for payment, notice of nonpayment, protest, notice of protest, bringing of suit, and diligence in taking any action to claim the amounts owing hereunder and is and shall be jointly and severally, directly and primarily, liable for the amount of all sums owing and to be owing hereon and agrees that this Note, or any payment hereunder, may be extended from time to time without affecting such liability.

During the existence of an Event of Default, Lender or other owner and holder hereof is expressly authorized to apply all payments made on this Note to the payment of such part of any delinquency as it may elect.

The remedies of the Lender as provided herein, in the Loan Agreement or the Security Instruments, or any other instruments evidencing or securing this Note, shall be cumulative and concurrent, and may be pursued singularly, successively or together, at the sole discretion of the Lender, and may be exercised as often as occasion therefore shall arise.  No act or omission of the Lender, including specifically any failure to exercise any right, remedy, or recourse, shall be deemed to be a waiver or release of the same, such waiver or release to be effected only through a written document executed by the Lender and then only to the extent specifically recited therein.  A waiver or release with reference to any one event shall not be construed as continuing, as a bar to, or as a waiver or release of, any subsequent right, remedy or recourse as to a subsequent event.  Notwithstanding anything herein to the contrary, in no event shall interest payable hereunder be in excess of the maximum rate allowed by applicable law. In the event any sums payable hereunder are determined to be in excess of the maximum allowable rate, amounts in excess of such maximum rate shall be deemed payments of principal.

Time is of the essence of this Note. Where used herein, the singular shall refer to the plural, the plural to the singular, and the masculine and feminine shall refer to any gender.  If Borrower is composed of more than one person or entity, “Borrower” as used herein shall refer to any and all persons or entities constituting Borrower, as the circumstances may require.

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This Note shall be governed by and construed under the laws of the State of Tennessee, except as such may be pre empted by applicable law or regulation of the United States of America governing the charging or receiving of interest.

The provisions hereof shall be binding upon the parties, their successors and assigns. The provisions hereof are severable such that the invalidity or unenforceability of any provision hereof shall not affect the validity or enforceability of the remaining provisions.

[Signature Page Follows]

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IN WITNESS WHEREOF, this instrument has been executed on the day and year first above written.

BORROWER:

J. ALEXANDER’S CORPORATION

a Tennessee corporation

By:           /s/ R. Gregory Lewis

R. Gregory Lewis

Vice President – Finance,

Chief Financial Officer, and Secretary

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EX-10

Exhibit 10.3

REVOLVING PROMISSORY NOTE

$5,000,000.00   May 22, 2009 Nashville, Tennessee

 

FOR VALUE RECEIVED, the undersigned, J. ALEXANDER’S CORPORATION, a Tennessee corporation (“Borrower”),  promises  to pay   to  the  order  of  PINNACLE NATIONAL BANK (“Lender”), in lawful currency of the United States of America, at its principal office in Nashville, Tennessee, or at such other place as the holder from time to time may designate in writing, the principal sum of FIVE MILLION AND NO/100 ($5,000,000.00) DOLLARS, or so much thereof as may be outstanding hereunder from time to time, together with interest thereon computed on the unpaid principal balance from the date of disbursement hereunder at an annual rate equal to LIBOR (as hereinafter defined) plus the Applicable Margin, as defined in the Loan Agreement (as hereinafter defined).  As used herein, “LIBOR” shall mean the London Interbank Offered Rate for one (1) month as published in The Wall Street Journal, which is the British Bankers’ Association average of interbank offered rates for dollar deposits in the London market on the date of this instrument, or if such date is not a publication date, on the next preceding publication date; provided, however, in no event shall the interest payable hereunder be less than 4.60% per annum. The interest rate shall be automatically adjusted on the tenth (10th) day of each month after execution hereof until the Maturity Date, as hereinafter defined, unless earlier accelerated, to the interest rate so calculated and in effect on such date, or the next preceding date for which the LIBOR rate is published, if no rate is published on such date.

Interest shall be calculated on the basis of a three hundred sixty (360) day year.  Principal and interest shall be payable as follows:

(a)            Commencing on the 22nd day of June, 2009, and on the same day of each succeeding month thereafter through April 22, 2012, monthly payments of interest only shall be due and payable.

(b)            The entire unpaid principal and all accrued interest and other charges shall be due and payable on May 22, 2012 (the “Maturity Date”).

The indebtedness evidenced hereby, and all extensions, modifications and renewals thereof, is secured by an Assignment and Security Agreement of even date herewith, and certain additional security documents (the “Security Instruments”).

The whole of the principal sum and, to the extent permitted by law, any accrued interest, shall bear, after default or maturity, interest at the lesser of (i) the highest lawful rate then in effect pursuant to applicable law, or (ii) the rate that is four percentage points (4%) in excess of the LIBOR, as it varies from time to time.

Sums shall be advanced hereunder subject to, and in accordance with, the conditions and other requirements contained in the Loan Agreement of even date herewith executed between Borrower and Lender (the “Loan Agreement”).

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Principal under this Note may be prepaid at any time without premium or other prepayment charge.  It is understood, however, that there are certain mandatory prepayment provisions which apply to this Note and are set forth in the Loan Agreement.

Upon the occurrence of an Event of Default (as defined in the Loan Agreement), then at the election of the legal holder hereof, at any time thereafter made and without demand or notice, the owner and holder of this Note shall have the right to declare all sums unpaid hereon at once due and payable. In the event of such Event of Default, and the same is placed in the hands of an attorney for collection, or a suit is filed hereon, or if the proceedings are held in bankruptcy, receivership, or the reorganization of Borrower, or any guarantor or surety of Borrower, or other legal or judicial proceedings for the collection hereof, Borrower agrees to pay in addition to the owner and holder of this Note, all costs of collection, including reasonable attorneys’ fees.

Borrower expressly waives presentment for payment, notice of nonpayment, protest, notice of protest, bringing of suit, and diligence in taking any action to claim the amounts owing hereunder and are and shall be jointly and severally, directly and primarily, liable for the amount of all sums owing and to be owing hereon and agree that this Note, or any payment hereunder, may be extended from time to time without affecting such liability.

During the existence of an Event of Default, Lender or other owner and holder hereof is expressly authorized to apply all payments made on this Note to the payment of such part of any delinquency as it may elect.

The remedies of the Lender as provided herein, or any other instruments evidencing or securing this Note, shall be cumulative and concurrent, and may be pursued singularly, successively or together, at the sole discretion of the Lender, and may be exercised as often as occasion therefor shall arise. No act or omission of the Lender, including specifically any failure to exercise any right, remedy, or recourse, shall be deemed to be a waiver or release of the same, such waiver or release to be effected only through a written document executed by the Lender and then only to the extent specifically recited therein. A waiver or release with reference to any one event shall not be construed as continuing, as a bar to, or as a waiver or release of, any subsequent right, remedy or recourse as to a subsequent event. Notwithstanding anything herein to the contrary, in no event shall interest payable hereunder be in excess of the maximum rate allowed by applicable law. In the event any sums payable hereunder are determined to be in excess of the maximum allowable rate, amounts in excess of such maximum rate shall be deemed payments of principal.

Time is of the essence of this Note.  Where used herein, the singular shall refer to the plural, the plural to the singular, and the masculine and feminine shall refer to any gender. If Borrower is composed of more than one person or entity, “Borrower” as used herein shall refer to any and all persons or entities constituting Borrower, as the circumstances may require.

This Note shall be governed by and construed under the laws of the State of Tennessee, except as such may be pre empted by applicable law or regulation of the United States of America governing the charging or receiving of interest.

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The provisions hereof shall be binding upon the parties, their successors and assigns. The provisions hereof are severable such that the invalidity or unenforceability of any provision hereof shall not affect the validity or enforceability of the remaining provisions.

[Signature Page Follows]

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IN WITNESS WHEREOF, this instrument has been executed on the day and year first above written.

BORROWER:

J. ALEXANDER’S CORPORATION,

a Tennessee corporation

By:          /s/ R. Gregory Lewis

R. Gregory Lewis

Vice President – Finance,

Chief Financial Officer, and Secretary

4

EX-10

Exhibit 10.4

STOCK PURCHASE AGREEMENT

STOCK PURCHASE AGREEMENT (the “Agreement”) dated as of May 22, 2009, among Solidus Company, L.P., a Tennessee limited partnership (“Solidus”), and E. Townes Duncan (“Duncan”) (collectively, the “Sellers” and each a “Seller”) on the one hand, and J. Alexander’s Corporation, a Tennessee corporation (the “Company”), on the other hand.

The Sellers wish to sell to the Company, and the Company wishes to purchase from each Seller, subject to the terms and conditions hereof, the number of authorized and issued shares of Common Stock, $.05 par value, of the Company (the “Common Stock”) set forth opposite such Seller’s name on Schedule 1 hereto (the “Shares”), which is a total of 808,000 shares.

In consideration of the foregoing and the agreements made herein, the parties hereto agree as follows:

ARTICLE I

STOCK PURCHASE

1.1.           Purchase and Sale.  Upon the terms herein set forth, the Sellers hereby sell, free and clear of all liens, claims, restrictions, security interests or encumbrances, the Shares to the Company, and the Company hereby acquires the Shares for a purchase price of $ 3.60 per share equaling an aggregate purchase price of $2,908,800 (the “Purchase Price”), payable to the Sellers in immediately available funds (the “Stock Purchase”).

ARTICLE II

DELIVERIES

2.1.           Sellers’ Deliveries.  The Sellers shall deliver contemporaneously herewith:

(A)           Certificates representing the Shares, duly endorsed (or accompanied by duly executed stock powers), for transfer to the Company.

(B)           Evidence reasonably satisfactory to the Company that all liens, claims, restrictions, security interests or encumbrances of any kind on the Shares have been released (or are being released upon the delivery of the Purchase Price) and any financing statements relating thereto are authorized to be terminated.

(C)           Evidence reasonably satisfactory to the Company that all requisite resolutions or approvals of or on behalf of the Sellers (or the partners of Solidus) authorizing and approving the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been made or given.

2.2.           Company Delivery.  At the Closing, the Company will deliver to Sellers the Purchase Price by wire transfer to the account designated by the Sellers.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF SELLERS

The Sellers, jointly and severally, to induce the Company to enter into and consummate the transactions contemplated hereby, hereby represent and warrant as follows:

3.1.           Ownership.  The Sellers are the sole record owners of the Shares and such Shares are free and clear of all liens, security interests, pledges, proxy restrictions, encumbrances or other interests of any kind whatsoever (other than a pledge to Pinnacle Financial Partners, N.A. (“Pinnacle”) which is being released and terminated simultaneously herewith).  Except as noted in the preceding sentence, the Sellers have not granted any interests or rights to any third party with respect to the Shares, and there are no agreements or arrangements obligating them to grant any such interest or rights to any third party.  Upon the delivery of the certificates for the Shares or the delivery of the shares by DWAC transfer to Computershare as the transfer agent for the Company’s common stock, the Company will obtain good, valid and marketable title to the Shares free and clear of all liens, claims and encumbrances whatsoever.

3.2.           Binding Agreement.  The Sellers have all requisite power and authority to enter into this Agreement and perform their obligations hereunder.  The execution, delivery and performance of this Agreement by Solidus has been duly and validly authorized by all necessary partnership action on the part of Solidus, including, without limitation, any required approval of limited partners.  This Agreement constitutes a valid and binding agreement of the Sellers enforceable against each of them in accordance with its terms, and no consent of any federal, state or other local authority or any other person or entity that has not been obtained is required to be obtained by the Sellers in connection with the consummation of the transactions contemplated by this Agreement.

3.3.           No Conflicts.  The execution and delivery of this Agreement, the consummation of the transactions contemplated hereby and the fulfillment of and compliance with the terms and conditions hereof do not and will not with the passing of time or giving of notice of conflict with, result in a breach of, or right to cancel or constitute a default under, any agreement or instrument to which either of the Sellers is a party, by which they are bound or to which the Sellers or the Shares are subject.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

4.1.           Existence and Qualification.  The Company is a corporation validly existing and in good standing under the laws of the State of Tennessee.

4.2.           Authority.  The Company has all requisite corporate power and authority to enter into this Agreement and to perform its obligations hereunder.

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ARTICLE V

COVENANTS AND AGREEMENTS

5.1.           Orderly Market.  Sellers hereby covenant and agree as follows:

(A)           For a period beginning on the date of this Agreement and ending on the second anniversary date hereof, the Sellers will not, without the prior consent of the Company’s Board of Directors specifically expressed in a resolution adopted by a majority of the directors of the Company who are not agents, affiliates, employees, directors or designees of a Seller, sell, transfer, or otherwise dispose of Remaining Voting Securities in excess of the following number of shares of Common Stock (adjusted for any stock splits) in the aggregate during the time periods set forth below, except to any affiliate, subsidiary or entity under the direct or indirect control of, or under common control with, the Seller:

Dates	Number of shares of Common Stock
date of this Agreement through December 31, 2009	100,000
calendar 2010	200,000
January 1, 2011 to second anniversary hereof	100,000

(B)           For purposes of this subsection:  “Seller” means E. Townes Duncan and Solidus Company, L.P., its or his successors, affiliates, subsidiaries, and other corporations, entities and persons under its or his direct or indirect control or under common control or acting on its or his behalf or in concert with it or him, and, as to an individual, his executors, heirs and beneficiaries; and “Remaining Voting Securities” means common stock and any other securities owned by Seller entitled to vote generally for the election of the Company’s directors and not otherwise purchased by the Company pursuant to the Stock Purchase.

5.2.           Further Action.  Each of the parties hereto shall execute such documents and take such action as may be reasonably requested by another party, as may be required by the terms and provisions of the Agreement to carry out the provisions and purposes of this Agreement.

ARTICLE VI

GENERAL PROVISIONS

6.1.           Assignment.  This Agreement may not be assigned by any party hereto, except this Agreement will inure to the benefit of any successor-in-interest of the Company or purchaser of all or substantially all the Company’s assets and will bind any persons that may be a “Seller” under Section 5.1.

6.2.           Counterparts.  This Agreement may be executed in counterparts and each such counterpart shall be deemed to be an original instrument.

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6.3.           Entire Agreement.  This Agreement, including the exhibits and other documents referred to herein or delivered pursuant hereto, contains the entire understanding of the parties with respect to its subject matter. This Agreement supersedes all prior agreements and understandings between the parties with respect to its subject matter.

6.4.           Choice of Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Tennessee.

6.5.           No Third Party Beneficiaries.  The parties do not intend to confer any benefit hereunder on any person or entity other than the parties hereto.

6.6.           Injunctions.  It is agreed that each party shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to specifically enforce the terms and provisions thereof in any action instituted in any court of the United States or any state thereof having subject mailer jurisdiction, in addition to any other remedy to which such party may be entitled, at law or in equity.

6.7.           Survival.  All provisions of this Agreement shall survive the Closing hereunder and shall remain applicable for five years; provided that the representations and warranties in Section 3.1 shall survive indefinitely.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have executed this Agreement and caused the same to be duly delivered on their behalf as of the day and year first written above.

SOLIDUS COMPANY, L.P.

By:  Its General Partner, Solidus General Partner, LLC

By: /s/ E. Townes Duncan

Name: E. Townes Duncan

Its: Chief Executive Officer

E. TOWNES DUNCAN

/s/ E. Townes Duncan

E. Townes Duncan

J. ALEXANDER’S CORPORATION

By: /s/ R. Gregory Lewis

Name: R. Gregory Lewis

Its: Vice President and Chief Financial Officer

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Schedule 1

Seller	Number of Shares	Represented by Cert. No(s).
Solidus Company, L.P.	800,000	61406
E. Townes Duncan	8,000	Street name at Charles Schwab

A- 1

EX-99

Exhibit 99.1

FOR IMMEDIATE RELEASE   Contact:  R. Gregory Lewis (615) 269-1900

J. ALEXANDER’S ANNOUNCES NEW CREDIT FACILITIES

AND STOCK REPURCHASE FROM SOLIDUS

Nashville, TN, May 22, 2009 – J. Alexander’s Corporation (NASDAQ: JAX) announced today that it had successfully closed new senior secured credit facilities with Pinnacle National Bank and repurchased 808,000 shares of its common stock from Solidus Company, L.P. and an affiliate at a price of $3.60 per share, using proceeds of a term loan under the credit facilities.

The new credit facilities consist of a three-year $5,000,000 revolving line of credit, which may be used for general corporate purposes, and a $3,000,000 term loan, which funded the stock repurchase.  The revolving line of credit replaces the Company’s previous line of credit.  The credit facilities will be secured by liens on certain personal property of the Company and its subsidiaries, subsidiary guaranties and a negative pledge on certain real property.

Amounts borrowed will bear interest at an annual rate of 30-day LIBOR plus an initial margin of 450 basis points, with a minimum interest rate of 4.6%.  Scheduled term loan payments are interest only for six months and monthly payments of principal plus interest over the remainder of the five-year term.  The credit facilities are subject to other customary terms and covenants.

Lonnie J. Stout II, Chairman, President and Chief Executive Officer of the Company, said “We are extremely pleased to complete our new credit facilities on favorable terms.  The three-year term of the revolving credit facility will provide financial flexibility to the Company.  The stock repurchase price represents a negotiated price that is approximately 14% below the closing market price on May 21, 2009, and approximately 62% below the Company’s net book value per share before the transaction.  We believe the transaction will increase significantly the long-term value to other shareholders of the Company.  In addition, we are pleased that Solidus has agreed to maintain a position in our stock and to limit potential future dispositions.”  The stock purchase was approved by the board of directors and by the Audit Committee of the board of directors, which is comprised solely of independent directors.

E. Townes Duncan, Chief Executive Officer of Solidus’s general partner, commented, “Solidus continues to remain a supporter of J. Alexander’s.  Solidus determined to liquidate a portion of its investment in J. Alexander’s in order to reduce indebtedness and pursue investment opportunities available in both public and private ventures in the current climate.  While Solidus’s position in the Company is reduced to approximately 8% of the Company’s outstanding stock, I am glad to remain a member of the Board of Directors of J. Alexander’s with a commitment to the Company’s future success.”  Solidus has agreed to limitations on its ability to sell its remaining shares of common stock, with dispositions limited to 100,000 shares in the remainder of 2009, 200,000 shares during 2010, and 100,000 shares during the first five months of 2011.

Cary Street Partners LLC, an investment banking and wealth management firm, rendered an opinion as to the fairness from a financial point of view of the purchase price to the Company and to the shareholders of J. Alexander’s other than Solidus and its affiliate.

J. Alexander’s Corporation operates 33 J. Alexander’s restaurants in thirteen states: Alabama, Arizona, Colorado, Florida, Georgia, Illinois, Kansas, Kentucky, Louisiana, Michigan, Ohio, Tennessee and Texas.  J. Alexander’s is an upscale, contemporary American restaurant known for its wood-fired cuisine.  The Company’s menu features a wide selection of American classics, including steaks, prime rib of beef and fresh seafood, as well as a large assortment of interesting salads, sandwiches and desserts.  J. Alexander’s also has a full-service bar that features an outstanding selection of wines by the glass and bottle.

J. Alexander’s Corporation is headquartered in Nashville, Tennessee.

This press release contains forward-looking statements that involve risks and uncertainties.  Actual results, performance or developments could differ materially from those expressed or implied by those forward-looking statements as a result of known or unknown risks, uncertainties and other factors.  These risks, uncertainties and factors include the Company’s ability to maintain satisfactory guest count levels and maintain or increase  sales and operating margins in its restaurants under recessionary economic conditions, which may continue indefinitely and which could worsen; conditions in the U.S. credit markets and the availability of bank financing on acceptable terms; changes in business or economic conditions, including rising food costs and product shortages as well as mandated  increases in the minimum wage the Company is required to pay; the effect of higher gasoline prices or commodity prices, unemployment and other economic factors on consumer demand; availability of qualified employees; increased cost of utilities, insurance and other restaurant operating expenses; potential fluctuations of quarterly operating results due to seasonality and other factors; the effect of hurricanes and other weather disturbances which are beyond the control of the Company; the number and timing of new restaurant openings and the Company’s ability to operate them profitably; competition within the casual dining industry, which is very intense; competition by the Company’s new restaurants with its existing restaurants in the same vicinity; changes in consumer spending, consumer tastes, and consumer attitudes toward nutrition and health; expenses incurred if the Company is the subject of claims or litigation or increased governmental regulation; changes in accounting standards, which may affect the Company’s reported results of operations; and expenses the Company may incur in order to comply with changing corporate governance and public disclosure requirements of the Securities and Exchange Commission and The NASDAQ Stock Market LLC.  These as well as other factors are discussed in detail in the Company’s filings made with the Securities and Exchange Commission and other communications.