THIS MANAGEMENT AGREEMENT (this "Agreement") is made effective this 23rd day of December, 2002 (the "Effective Date"), between EATERIES, INC., an Oklahoma corporation ("Manager"), and FIESTA, L.L.C., an Oklahoma limited liability company ("Owner").

RECITALS

A. Manager, by and through its wholly owned subsidiary, Fiesta Restaurants, Inc., an Oklahoma corporation, has sold to Owner all of the assets of seven (7) of its restaurants and one (1) concession under the trade name "Garcias Mexican Restaurant" located in Arizona" pursuant to that certain Acquisition Agreement dated effective as of December 16, 2002 (the "Acquisition Agreement") and all of the assets of the restaurant located at 4925 East Shea Boulevard, Phoenix, Arizona and operated under the trade name "Garcias Mexican Restaurant" pursuant to that certain Acquisition Agreement dated effective as of December 16, 2002, all as identified on Schedule "1" attached hereto (collectively, the "Fiesta Restaurants").

B. Owner has acquired controlling ownership of Best Restaurants, L.L.C., an Oklahoma limited liability company and Best Restaurants II, L.L.C., an Oklahoma limited liability company (collectively, "Best Restaurants"), which operate three (3) restaurants under the trade name "Garcias Mexican Restaurant" located in Carmichael, California; Idaho Falls, Idaho; and Layton, Utah, as identified on Schedule "1" attached hereto (the "BR Restaurants").

C. Owner has assumed the obligations of franchisor and/or licensor under certain franchise and/or license agreements for restaurants operated under the trade name "Garcias Mexican Restaurant", as identified on Schedule "1" attached hereto, and may establish franchise and/or license arrangements with additional restaurants (collectively, the "Franchise Restaurants").

D. Owner and/or Owners designated affiliates, including, without limitation, Best Restaurants desire to retain Manager to manage and operate the Fiesta Restaurants, the BR Restaurants (in addition to and not in replacement of the current agreement between Best Restaurants and Manager to provide accounting services to the BR Restaurants) and any additional Garcias Restaurants owned and/or developed by Owner or its affiliates (collectively, the "Restaurants"), and provide support services to the Franchised Restaurants, on the terms and conditions set forth in this Agreement. Any reference to Owner throughout this Agreement shall mean and include any and all of Owners designated affiliates that may directly or indirectly control or own an interest in any of the Restaurants.

E. Manager is experienced in restaurant operation and management and has the staff, expertise and capability to perform the terms of this Agreement.

NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and agreements contained in this Agreement and other good and valuable consideration not recited in this Agreement, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Engagement and Authorization.

1.01 Engagement As Manager. Owner hereby engages Manager as its sole and exclusive agent to supervise, manage, direct and control the operations of the Restaurants, in accordance with the terms and conditions hereof. Manager hereby accepts such engagement as the manager of the Restaurants during the Term, as hereafter defined, of this Agreement.

1.02 Grant of Authority. Owner hereby grants Manager full power and authority to take all actions and to do all things reasonably required to perform the obligations of the Manager under this Agreement; provided that: (i) Manager shall not have the power and authority to grant any mortgage, encumbrance, security interest, pledge or other lien on any tangible or intangible asset of Owner without the approval of Owner. In the performance of this Agreement, Manager shall act as the agent of Owner; and (ii) such power and authority will be limited to providing the Services, as defined herein. Nothing herein shall constitute or be construed to be or create a partnership, joint venture or lease between Owner and Manager. The creation of this agency shall not in any manner relieve Owner of its duties or obligations under contract or law. All debts and liabilities incurred by Manager in the course of its management of the Restaurants shall be the debts and liabilities of Owner and in no event shall be the debts and liabilities of Manager.

2. Managers Duties. Throughout the Term of this Agreement, Manager will use the Manager's commercially reasonable efforts and due diligence to manage and operate the Restaurants in a manner and quality not less than those provided by Manager with respect to the restaurants it owns. During the Term, Manager shall provide Owner with the following specific services (hereinafter collectively referred to as the "Services"), at each of the Restaurants:

2.01 Restaurant Management. Manager shall oversee the day-to-day management of the Restaurants, which responsibilities shall include: (a) the hiring, training and supervising of all restaurant employees, as more particularly described below; (b) the preparation of the Proposed Operating Budget and the updating of the Approved Operating Budget, as hereafter defined; (c) the reviewing, approving and paying of all operating expenses pursuant to the Approved Operating Budget; (d) the maintenance of business files and records; (e) the performance of general administrative functions; and (f) the preparation of the Restaurants' monthly activities, as more particularly described below. In addition, Manager shall manage, operate, and maintain the Restaurants in such a manner that each Restaurant is at all times in substantial compliance with: (i) all zoning and use restrictions, fire codes, building codes, and other requirements issued by any governmental authority; (ii) all licenses, permits and other authorizations required in the operation of the Restaurants; (iii) any policy of insurance covering the Restaurants; (iv) any real estate lease, as applicable, to avoid any default by Owner thereunder; (v) the negotiation of inventory purchase contracts with vendors, including combining purchasing quantity of Manager and its franchisee and/or licensees with the purchasing quantity of Owner, its affiliates and franchisee and/or licensees in order to obtain any vendor discounts, rebates or refunds; and (vi) all applicable laws and regulations. With the written consent of Owner, Manager may in the name of itself, Owner or both, take such appropriate action as necessary to challenge to protest the validity or application of any legal requirement, tax or other imposition against the Restaurants. Owner shall execute and deliver any documents which Manager deems reasonably necessary and appropriate in connection with such action.

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