STOCK SALE AGREEMENT
EXHIBIT
1
THIS
STOCK SALE AGREEMENT (the “Agreement”) is made and entered into as of December
1, 2009 by and between (1) Xxxxxxx X. Xxxxx (“Buyer”), and (2) each of The D 3
Family Fund, L.P., the D 3
Family Bulldog Fund, L.P. and The DIII Offshore Fund,
L.P. (each a “Seller”).
A. Buyer
desires to purchase from each Seller, at a price of $2.00 in cash (the “Per
Share Price”) for each share (a “Subject Share”) of the Common Stock of Mexican
Restaurants, Inc., a Texas corporation (the “Company”) to be sold hereunder, the
number of Subject Shares set forth before next to each Seller’s
name:
The D 3
Family Fund,
L.P. : 236,267 Subject Shares
The D 3
Family Bulldog
Fund : 686,698 Subject Shares
The DIII Offshore Fund,
L.P. : 269,991 Subject Shares
B. Each
Seller desires to sell such Seller’s Subject Shares to Buyer at the Per Share
Price.
C. This
Agreement sets forth the terms and conditions of the sale of each Seller’s
Subject Shares to Buyer, and Buyer’s purchase of such Subject Shares from each
Seller, at the Per Share Price.
Buyer and
each Seller hereby agree as follows:
1. Purchase and Sale of
Shares .
(a) Purchase and Sale
.. Subject to the terms and conditions of this Agreement, at the
Closing (as hereinafter defined) each Seller shall sell and transfer to Buyer,
and Buyer shall purchase from each Seller, all of such Seller’s Subject Shares
for the Per Share Price. The aggregate amount to be paid by Buyer to
each Seller for such Seller’s Subject Shares shall be as follows:
The D 3
Family Fund,
L.P. : $472,534
The D 3
Family Bulldog
Fund : $1,373,396
The DIII Offshore Fund,
L.P. : $539,982
(b) Closing
.. The closing of the purchase and sale (the “Transaction”) of all the
Subject Shares (the “Closing”) shall take place at such time as Buyer and
Sellers (collectively, the “Parties”) shall collectively agree.
(c) Delivery
.. Subject to the terms and conditions of this Agreement, at the
Closing, each Seller shall sell, assign and convey such Seller’s Subject Shares,
by delivering an authorization letter to Seller’s broker to deliver such
Seller’s Subject Shares electronically to the brokerage account identified by
Buyer prior to the Closing, against Buyer’s payment to such Seller of the
aggregate purchase price for such Seller’s Subject Shares (as set forth in
Section 1.1) by wire transfer of immediately available funds to the bank account
identified by such Seller prior to the Closing. Notwithstanding the
foregoing, Buyer and the applicable Seller acknowledge that 100,000 of the
Subject Shares beneficially owned by one of the Sellers are represented by a
physical certificate issued in the name of such Seller’s broker and bearing a
restricted legend. Delivery of such Subject Shares shall be by
physical delivery of such certificate together with a duly executed assignment
separate from certificate in a form to be agreed between Buyer and such
Seller.
2. Representation and
Warranties .
(a) Representation and
Warranties of Each Seller . Each Seller hereby represents and
warrants to Buyer as follows (which representations and warranties shall survive
the Closing):
(i) Such
Seller has the full right, power and authority to enter into and perform
Seller’s obligations under this Agreement. All corporate action on
the part of such Seller necessary for the execution of this Agreement and the
performance of such Seller’s obligations hereunder has been taken or will be
taken prior to the Closing.
(ii) No
consent, approval or authorization of or designation, declaration or filing with
any third party or any governmental authority is required on the part of such
Seller in connection with the valid execution and delivery of this Agreement or
the performance of such Seller’s obligations hereunder.
(iii) Such
Seller has the full right, power and authority to sell and transfer such
Seller’s Subject Shares hereunder.
(iv) Such
Seller owns such Seller’s Subject Shares, free and clear of any lien,
encumbrance, option, charge, equitable interest or restriction, other than any
applicable restrictions on transfer under applicable state and federal
securities laws. Upon payment of the aggregate purchase price for
such Seller’s Subject Shares at the Closing, Buyer will acquire all of such
Seller’s Subject Shares, free and clear of any lien, encumbrance, option,
charge, equitable interest or restriction; provided, however, that such Seller’s
Subject Shares will remain subject to any applicable restrictions on transfer
under applicable state and federal securities laws.
(v) Such
Seller (i) a highly sophisticated investor which, in securities matters, is able
to make determinations with respect to securities based upon the advice and
abilities of its general partner, and (ii) has sufficient information concerning
the Company, its business, financial condition and prospects to reach an
informed and knowledgeable decision to sell such Seller’s Subject Shares
hereunder.
(vi) The
Sellers’ respective Subject Shares, in the aggregate, comprise all of the shares
of the Company's Common Stock beneficially owned, for purposes of Section 13(d)
of the Securities Exchange Act of 1934, and the rules and regulations
promulgated thereunder by the Securities and Exchange Commission), by each
Seller and any other person under the common control of the same general partner
as each Seller except for 17,500 shares that are the subject of options issued
by the Company and owned by one of the Sellers.
(b) Representations and
Warranties of Buyer . Buyer hereby represents and warrants to
each Seller as follows (which representations and warranties shall survive the
Closing):
(i) Buyer
has the full right, power and authority to enter into and perform Buyer’s
obligations under this Agreement. All action on the part of Buyer
necessary for the execution of this Agreement and the performance of Buyer’s
obligations hereunder has been taken or will be taken prior to the
Closing.
(ii) No
consent, approval or authorization of or designation, declaration or filing with
any third party or any governmental authority is required on the part of Buyer
in connection with the valid execution and delivery of this Agreement or the
performance of Buyer’s obligations hereunder.
(iii) Buyer
(i) is capable of bearing the economic risk and burden of its investment in the
Subject Shares, (ii) has substantial experience in investing in securities and
therefore has the ability to “fend for himself” in connection with Buyer’s
investment in the Subject Shares and is able to make determinations with respect
to securities based upon Buyer’s own abilities and such advice (if any) as Buyer
chooses to obtain, (iii) has sufficient information concerning the Company, its
business, financial condition and prospects to reach an informed and
knowledgeable decision to acquire the Subject Shares, and (iv) is purchasing the
Subject Shares for Buyer’s own account and solely for investment, with no
current intention to resell or distribute the Subject Shares other than in
compliance with applicable state and federal securities laws.
3. Related Agreements
..
(i) Each
Seller acknowledges that Buyer and its affiliates may possess information
regarding the Company that is material and that has not been disclosed to such
Seller. Each Seller agrees that neither Buyer nor any of its
affiliates shall have any liability to such Seller in respect of, and each
Seller hereby waives and releases Buyer and its affiliates from all claims which
such Seller might otherwise have with respect to, and agrees that such Seller
will not bring any claim against Buyer or any of its affiliates in respect of,
the non-disclosure to such Seller of non-public information (if any) that may be
in Buyer’s possession before or after the date hereof.
(ii) Buyer
acknowledges that each Seller and its affiliates may possess information
regarding the Company that is material and that has not been disclosed to
Buyer. Buyer agrees that neither any Seller nor any of such Seller’s
affiliates shall have any liability to Buyer in respect of, and Buyer hereby
waives and releases each Seller and each Seller’s affiliates from all claims
which such Buyer might otherwise have with respect to, and agrees that Buyer
will not bring any claim against any Seller or any of such Seller’s affiliates
in respect of, the non-disclosure to Buyer of non-public information (if any)
that may be in such Seller’s possession before or after the date
hereof.
4. Miscellaneous
..
(a) Governing Law
.. This Agreement shall be governed in all respects by the laws of the
State of Delaware as such laws are applied to agreements entered into and to be
performed entirely within the State of Delaware.
(b) Amendments
.. No amendment or modification of the terms and conditions of this
Agreement shall be valid unless in writing and signed by all Parties; provided , however , that any
agreement pursuant to the terms of Section 1.2 or 1.3 of this Agreement shall
not be deemed an amendment to this Agreement.
(c) Entire Agreement
.. This Agreement constitutes the entire agreement between the parties
with respect to the transactions contemplated hereby. This Agreement
supersedes all prior agreements, understandings, negotiations and
representations between the parties with respect to such
transactions.
(d) Waiver
.. Any Party’s failure to enforce any provision of this Agreement
shall not in any way be construed as a waiver of any such provision, or prevent
that Party thereafter from enforcing each and every other provision of this
Agreement.
(e) Counterparts
.. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original but all of which together shall constitute one
and the same instrument.
(f) Further Assurances
.. Each Party shall execute and deliver such additional instruments,
documents and other writings as may be reasonably requested by another party,
before or after the Closing, to confirm and carry out and to effectuate fully
the intent and purposes of this Agreement; provided , however , that each
Party shall be responsible for making such filings with the Securities and
Exchange Commission as that Party determines necessary or appropriate regarding
to the execution of this Agreement and/or the Closing.
(g) Expenses
.. Buyer and each Seller shall bear its own respective expenses and
legal fees incurred in connection with this Agreement and the
Transaction.
(h) Several Obligations
Only . The obligations of each Seller under this Agreement
shall be solely the obligations of such Seller and no Seller shall have any
obligations under this Agreement jointly with any other Seller.
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IN
WITNESS WHEREOF, the parties have executed this Stock Sale Agreement as of the
date set forth above.
Buyer
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XXXXXXX
X. XXXXX
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/s/
Xxxxxxx X. Xxxxx
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Each
Sellers
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The
D 3 Family Fund,
L.P.
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and
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The
D 3 Family Bulldog
Fund, L.P.
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The
DIII Offshore Fund, L.P.
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By
Xxxxxxxxxx Investment Management Company, Inc., its General
Partner
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By
Xxxxxxxxxx Investment Management Offshore, Inc., its General
Partner
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By: /s/
Xxxxx Xxxxxxxxxx
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By: /s/
Xxxxx Xxxxxxxxxx
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Xxxxx Xxxxxxxxxx, President
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Xxxxx Xxxxxxxxxx, President
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[Signature
Page to Stock Sale Agreement]