Exhibit 10.2

AMENDED AND RESTATED SECURITY AGREEMENT

THIS AMENDED AND RESTATED SECURITY AGREEMENT (this “Security Agreement”) is
entered into as of June 15, 2007 among RED ROBIN INTERNATIONAL, INC., a Nevada
corporation (the “Borrower”), RED ROBIN GOURMET BURGERS, INC., a Delaware
corporation (the “Parent”), those Domestic Subsidiaries of the Borrower as may
from time to time become parties hereto (together with the Parent, individually
a “Guarantor” and collectively the “Guarantors”; the Guarantors and the
Borrower, individually an “Obligor” and collectively the “Obligors”) and
WACHOVIA BANK, NATIONAL ASSOCIATION, in its capacity as administrative agent (in
such capacity, the “Administrative Agent”) for the lenders from time to time
party to the Credit Agreement described below (the “Lenders”).

RECITALS

WHEREAS, pursuant to that certain Amended and Restated Credit Agreement dated as
of December 14, 2005 (as amended or modified, the “Existing Credit Agreement”),
among the Borrower, the Guarantors, the lenders party thereto, and the
Administrative Agent, the Lenders agreed to make loans and issue or participate
in letters of credit upon the terms and subject to the conditions set forth
therein;

WHEREAS, pursuant to that certain Amended and Restated Credit Agreement dated as
of the date hereof (as amended, modified, extended, renewed, restated or
replaced from time to time, the “Credit Agreement”), among the Borrower, the
Guarantors, the Lenders party thereto, and the Administrative Agent, the Lenders
have agreed to refinance the Existing Credit Agreement and make Loans and issue
or participate in Letters of Credit upon the terms and subject to the conditions
set forth therein;

WHEREAS, in connection with the Existing Credit Agreement, the Borrower and the
Guarantors entered into that certain Amended and Restated Security Agreement
dated as of December 14, 2005 (as amended or modified, the “Existing Security
Agreement”); and

WHEREAS, it is a condition precedent to the effectiveness of the Credit
Agreement and the obligations of the Lenders to make their respective Loans and
to issue or participate in Letters of Credit under the Credit Agreement that the
Obligors shall have executed and delivered this Security Agreement (which amends
and restates the Existing Security Agreement) to the Administrative Agent for
the ratable benefit of the Lenders.

NOW, THEREFORE, in consideration of these premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

1.             Definitions.

(a)           Unless otherwise defined herein, capitalized terms used herein
shall have the meanings ascribed to such terms in the Credit Agreement, and the
following terms which

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are defined in the Uniform Commercial Code from time to time in effect in the
State of North Carolina (the “UCC”) are used herein as so defined: Accessions,
Accounts, As-Extracted Collateral, Chattel Paper, Commercial Tort Claims,
Consumer Goods, Control, Deposit Accounts, Documents, Electronic Chattel Paper,
Equipment, Farm Products, Fixtures, General Intangibles, Goods, Instruments,
Inventory, Investment Property, Letter-of-Credit Rights, Manufactured Homes,
Proceeds, Securities Intermediary, Security Entitlement, Software, Supporting
Obligations and Tangible Chattel Paper.  For purposes of this Security
Agreement, the term “Lender” shall include any Hedging Agreement Provider.

(b)           In addition, the following terms shall have the following meaning:

“Material”: shall mean, with respect to any item of Collateral (or amount
payable thereunder or in connection therewith with respect to Accounts or
similar obligations) qualified by the term “Material” in this Security
Agreement, that such item of Collateral (or such amount), when aggregated with
all other items of Collateral excluded because such items are qualified by the
term “Material,” has a fair market value in excess of $500,000 in the aggregate.

“Secured Obligations”: the collective reference to the following:

(a)           all Credit Party Obligations (including obligations under Secured
Hedging Agreements), howsoever evidenced, created, incurred or acquired, whether
primary, secondary, direct, contingent, or joint and several; and

(b)           all reasonable expenses and charges, legal and otherwise, incurred
by the Administrative Agent and/or the Lenders and/or the Hedging Agreement
Providers in collecting or enforcing any Credit Party Obligation or in realizing
on or protecting any security therefor, including without limitation, the
security granted hereunder.

“Vehicles”: shall mean all cars, trucks, vans, trailers, construction and earth
moving equipment and other vehicles covered by a certificate of title law of any
state, including, without limitation, all tires and other appurtenances to any
of the foregoing.

2.             Grant of Security Interest in the Collateral.  To secure the
prompt payment and performance in full when due, whether by lapse of time,
acceleration, mandatory prepayment or otherwise, of the Secured Obligations,
each Obligor hereby grants to the Administrative Agent, for the ratable benefit
of the Lenders, a continuing security interest in, and a right to set off
against, any and all right, title and interest of such Obligor in and to the
following, whether now owned or existing or owned, acquired, or arising
hereafter (collectively, the “Collateral”):

(a)           all Accounts;

(b)           all cash and Cash Equivalents;

(c)           all Chattel Paper (including Electronic Chattel Paper);

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(d)           those certain Commercial Tort Claims of such Obligor set forth on
Schedule 2(d) attached hereto (as such Schedule may be updated from time to time
by the Obligors);

(e)           all Copyright Licenses;

(f)            all Copyrights;

(g)           all Deposit Accounts;

(h)           all Documents;

(i)            all Equipment;

(j)            all Fixtures;

(k)           all General Intangibles;

(l)            all Goods;

(m)          all Instruments;

(n)           all Inventory;

(o)           all Investment Property;

(p)           all Letter-of-Credit Rights;

(q)           all Material Contracts and all such other agreements, contracts,
leases, licenses, tax sharing agreements or hedging arrangements now or
hereafter entered into by an Obligor, as such agreements may be amended or
otherwise modified from time to time (collectively, the “Assigned Agreements”),
including without limitation, (i) all rights of an Obligor to receive moneys due
and to become due under or pursuant to the Assigned Agreements, (ii) all rights
of an Obligor to receive proceeds of any insurance, indemnity, warranty or
guaranty with respect to the Assigned Agreements, (iii) claims of an Obligor for
damages arising out of or for breach of or default under the Assigned Agreements
and (iv) the right of an Obligor to terminate the Assigned Agreements, to
perform thereunder and to compel performance and otherwise exercise all remedies
thereunder;

(r)            all Payment Intangibles;

(s)           all Patent Licenses;

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(t)            all Patents;

(u)           all Software;

(v)           all Supporting Obligations;

(w)          all Trademark Licenses;

(x)            all Trademarks;

(y)           all books, records, ledger cards, files, correspondence, computer
programs, tapes, disks, and related data processing software (owned by such
Obligor or in which it has an interest) that at any time evidence or contain
information relating to any Collateral or are otherwise necessary or helpful in
the collection thereof or realization thereupon;

(z)            to the extent not otherwise included, all, Accessions, Proceeds
and products of any and all of the foregoing; and

(aa)         all other assets of such Obligor.

Notwithstanding the foregoing, “Collateral” shall not include (i) Deposit
Accounts that consist of, contain or include money deposited by franchisees to
the extent the Credit Parties do not have money deposited in such accounts
exceeding $500,000 in the aggregate, (ii) shares of Capital Stock of any Foreign
Subsidiary in excess of 65% of the total shares of outstanding Capital Stock of
such Foreign Subsidiary to the extent that a pledge of, or lien on, such shares
would result in adverse tax consequences for any Obligor, or (iii) any “Excluded
Property” (as defined below) until such time, if any, as the prohibitions
causing such property to be Excluded Property have terminated (howsoever
occurring).  Upon such termination, the Administrative Agent will be deemed to
have and at all times from and after the date hereof to have had, a security
interest in such Excluded Property and the relevant Obligor shall take all
actions necessary in the reasonable judgment of the Administrative Agent to
perfect such security interest.  The term “Excluded Property” means (a) any
permit, lease, license, agreement, contract or other General Intangible of any
Obligor that validly prohibits the creation by such Obligor of a security
interest therein which was entered into prior to the date hereof (to the extent
such prohibition is not invalidated under the UCC) and (b) any permit, lease,
license, agreement, contract or other General Intangible of such Obligor to the
extent that any Requirement of Law applicable thereto prohibits the creation by
such Obligor of a security interest therein, in each case other than (i) the
right to receive any payment of money due in respect of such permit, lease,
license, agreement, contract or other General Intangible and (ii) any
Accessions, Proceeds or products of any such permit, lease, license, agreement,
contract or other General Intangible (unless such Accessions, Proceeds or
products would itself constitute Excluded Property).

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The Obligors and the Administrative Agent, on behalf of the Lenders, hereby
acknowledge and agree that the security interest created hereby in the
Collateral (i) constitutes continuing collateral security for all of the Secured
Obligations, whether now existing or hereafter arising and (ii) is not to be
construed as an assignment of any Intellectual Property.

The term “Collateral” shall include any Secured Hedging Agreement and any rights
of the Obligors thereunder only for purposes of this Section 2.

3.             Provisions Relating to Accounts, Material Contracts and Assigned
Agreements.

(a)           Anything herein to the contrary notwithstanding, each of the
Obligors shall remain liable under each of its Accounts, Material Contracts and
Assigned Agreements to observe and perform all the conditions and obligations to
be observed and performed by it thereunder, all in accordance with the terms of
any agreement giving rise to each such Account or the terms of such Material
Contracts and Assigned Agreements.  Neither the Administrative Agent nor any
Lender shall have any obligation or liability under any Account (or any
agreement giving rise thereto), Material Contract or Assigned Agreement by
reason of or arising out of this Security Agreement or the receipt by the
Administrative Agent or any Lender of any payment relating to such Account,
Material Contract or Assigned Agreement pursuant hereto, nor shall the
Administrative Agent or any Lender be obligated in any manner to perform any of
the obligations of an Obligor under or pursuant to any Account (or any agreement
giving rise thereto), Material Contract or Assigned Agreement, to make any
payment, to make any inquiry as to the nature or the sufficiency of any payment
received by it or as to the sufficiency of any performance by any party under
any Account (or any agreement giving rise thereto), Material Contract or
Assigned Agreement, to present or file any claim, to take any action to enforce
any performance or to collect the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.

(b)           At any time and from time to time, the Administrative Agent shall
have the right, but not the obligation, to make test verifications of the
Accounts in any manner and through any medium that it reasonably considers
advisable, and the Obligors shall furnish all such assistance and information as
the Administrative Agent may reasonably require in connection with such test
verifications.  At any time upon the occurrence and during the continuation of a
Default or Event of Default upon the Administrative Agent’s request and at the
expense of the Obligors, the Obligors shall cause independent public accountants
or others satisfactory to the Administrative Agent to furnish to the
Administrative Agent reports showing reconciliations, aging and test
verifications of, and trial balances for, the Accounts.  The Administrative
Agent in its own name or in the name of others may communicate with account
debtors on the Accounts to verify with them to the Administrative Agent’s
satisfaction the existence, amount and terms of any Accounts.

4.             Representations and Warranties.  Each Obligor hereby represents
and warrants to the Administrative Agent, for the benefit of the Lenders, that
so long as any of the Secured Obligations remain outstanding (other than
contingent indemnity obligations which by the terms

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thereof are stated to survive termination of the Credit Documents) or any Credit
Document or Secured Hedging Agreement is in effect, and until all of the
Commitments shall have been terminated:

(a)           Chief Executive Office; Books & Records; Legal Name; State of
Formation.  As of the Closing Date, each Obligor’s chief executive office and
chief place of business are (and for the prior four months prior to the date
hereof has been) located at the locations set forth on Schedule 3.19(c) to the
Credit Agreement (as updated from time to time), and as of the Closing Date each
Obligor keeps its books and records at such locations.  As of the Closing Date,
each Obligor’s exact legal name is as shown in this Security Agreement and its
state of formation is (and for the prior four months prior to the date hereof
has been) the location set forth on Schedule 3.12 to the Credit Agreement.  No
Obligor has in the past four months prior to the date hereof changed its name,
been party to a merger, consolidation or other change in structure or used any
tradename not disclosed on Schedule 4(a) attached hereto (as updated from time
to time in accordance with Section 5(d)).

(b)           Location of Collateral.  As of the Closing Date, the tangible
Collateral owned by each Obligor is located solely at the locations set forth on
Schedule 3.19(b) to the Credit Agreement (other than immaterial portions of
Inventory and/or Equipment in transit or held in warehouses, provided that such
Inventory and/or Equipment has a fair market value not in excess of $500,000 in
the aggregate).

(c)           Ownership.  Each Obligor is the legal and beneficial owner of its
Collateral and has the right to pledge, sell, assign or transfer the same except
to the extent that any pledge, sale, assignment or transfer of such Collateral
is prohibited or limited by applicable law, regulations or administrative
guidelines or by any contract entered into prior to the date hereof.

(d)           Security Interest/Priority.  This Security Agreement creates a
valid security interest in favor of the Administrative Agent, for the benefit of
the Lenders, in the Collateral of such Obligor and, when properly perfected by
filing, the granting of Control to the Administrative Agent or otherwise, shall
constitute a valid first priority, perfected security interest in the Collateral
with respect to which the security interest is to be perfected, to the extent
such security interest can be perfected by filing or otherwise under the UCC or
by filing an appropriate notice with the United States Patent and Trademark
Office or the United States Copyright Office, free and clear of all Liens except
for Permitted Liens.

(e)           Consents.  Except for (i) the filing or recording of UCC financing
statements, (ii) the filing of appropriate notices with the United States Patent
and Trademark Office and the United States Copyright Office or (iii) obtaining
Control to perfect the Liens created by this Security Agreement, no consent or
authorization of, filing with, or other act by or in respect of, any arbitrator
or Governmental Authority and no consent of any other Person (including, without
limitation, any stockholder, member or creditor of such Obligor), is required
under the UCC (i) for the grant by such Obligor of the

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security interest in the Collateral granted hereby or for the execution,
delivery or performance of this Security Agreement by such Obligor or (ii) for
the perfection of such security interest or the exercise by the Administrative
Agent of the rights and remedies provided for in this Security Agreement.

(f)            Types of Collateral.  None of the Collateral consists of, or is
the Proceeds of, As-Extracted Collateral, Consumer Goods, Farm Products,
Manufactured Homes or standing timber (as such term is used in the UCC).

(g)           Accounts.  With respect to the Accounts of the Obligors:  (i) each
Account and the papers and documents of the applicable Obligor relating thereto
are genuine and in all material respects what they purport to be; (ii) each
Account arises out of a bona fide transaction for goods sold and delivered (or
in the process of being delivered) by an Obligor or for services actually
rendered by an Obligor, which transaction was conducted in the ordinary course
of the Obligor’s business and was or will be performed substantially in
accordance with the terms of any documents pertaining thereto; (iii) no Account
of an Obligor is evidenced by any Instrument or Chattel Paper unless such
Instrument or Chattel Paper has been theretofore delivered to, or submitted to
the Control of, the Administrative Agent; provided that this subsection (iii) is
not intended to (A) require the endorsement or delivery of ordinary course
records and payment instructions or (B) require the endorsement or delivery of
any individual Instrument or Chattel Paper in an amount of less than $500,000;
(iv) the amount of each Account as shown on the applicable Obligor’s books and
records, and on all invoices and statements which may be delivered to the
Administrative Agent with respect thereto, is payable to the applicable Obligor
and no material portion of the Accounts are contingent; (v) no Account is
evidenced by a judgment, there are no set-offs, counterclaims or disputes
existing or asserted with respect to any Account that in the aggregate could
reasonably be expected to have a Material Adverse Effect, and no Obligor has
made any agreement with any account debtor for any deduction from any Account
except a discount or allowance for prompt payment allowed by the applicable
Obligor and other discounts or allowances made in the ordinary course of its
business; (vi) there are no facts, events or occurrences which in any material
respect impair the validity or enforcement of any Material Account or could
reasonably be expected to materially reduce the amount payable thereunder as
shown on the applicable Obligor’s books and records and all invoices and
statements delivered to the Administrative Agent with respect thereto; (vii) the
right to receive payment under each Account is assignable except where the
account debtor with respect to such Account is the United States government or
any State government or any agency, department or instrumentality thereof, to
the extent the assignment of any such right to payment is prohibited or limited
by applicable law, regulations, administrative guidelines or contract; and
(viii) the goods sold and/or services furnished giving rise to each Account are
not subject to any security interest or Lien except the security interest
granted the Administrative Agent herein and except for Permitted Liens.

(h)           Inventory.  No Inventory of an Obligor is held by a third party
(other than an Obligor) pursuant to consignment, sale or return, sale on
approval or similar arrangement.

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(i)            Intellectual Property.

(i)            Schedule 3.16 to the Credit Agreement includes all Intellectual
Property owned by the Obligors in their own names, or that the Obligors have the
right to use, as of the Closing Date.

(ii)           Each Material Copyright, Material Patent and Material Trademark
owned by such Obligor is valid, subsisting, unexpired, and to such Obligor’s
knowledge, enforceable and has not been abandoned, and such Obligor is legally
entitled to use each of its tradenames.

(iii)          Except as set forth in Schedule 3.16 to the Credit Agreement,
none of the Material Copyrights, Material Patents and Material Trademarks is the
subject of any licensing or franchise agreement other than for the benefit of
any franchisee.

(iv)          No holding, decision or judgment has been rendered by any
Governmental Authority which would limit, cancel or question the validity of any
Material Intellectual Property of the Obligors.

(v)           No action or proceeding is pending seeking to limit, cancel or
question the validity of any Material Intellectual Property, or which, if
adversely determined, would have a material adverse effect on the value of any
Material Intellectual Property.

(vi)          All applications pertaining to the Material Copyrights, Material
Patents and Material Trademarks of each Obligor have been duly and properly
filed, and all registrations or letters pertaining to such Copyrights, Patents
and Trademarks have been duly and properly filed and issued, and all of such
Copyrights, Patents and Trademarks are valid and enforceable.

(vii)         No Obligor has made any assignment or agreement in conflict with
the security interest of the Administrative Agent in the Material Intellectual
Property of each Obligor hereunder.

(j)            Documents, Instruments and Chattel Paper.  All Documents,
Instruments and Chattel Paper describing, evidencing or constituting Collateral
are, to the Obligors’ knowledge, complete in all material respects, valid and
genuine.

(k)           Equipment.  With respect to each Obligor’s Equipment that is
material to its business:  (i) such Obligor has good and marketable title
thereto or a valid leasehold interest therein; and  (ii) all such Equipment is
in normal operating condition and repair, ordinary wear and tear and
obsolescence alone excepted (subject to casualty events), and is suitable for
the uses to which it is customarily put in the conduct of such Obligor’s
business.

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(l)            Restrictions on Security Interest.  None of the Obligors is party
to any material license (other than certain liquor licenses) or any material
personal property lease that contains legally enforceable restrictions on the
granting of a security interest therein.

(m)          Collateral Requiring Control to Perfect.  Set forth on Schedule
4(m) is a description of all Deposit Accounts, Electronic Chattel Paper, Letter
of Credit Rights, Securities Accounts and uncertificated Investment Property of
the Obligors, including the name and address of (i) in the case of a Deposit
Account, the depository institution, (ii) in the case of Electronic Chattel
Paper, the account debtor, (iii) in the case of Letter of Credit Rights, the
issuer or nominated person, as applicable, and (iv) in the case of a Securities
Account or other uncertificated Investment Property, the Securities Intermediary
or issuer, as applicable.

5.             Covenants.  Each Obligor covenants that, so long as any of the
Secured Obligations remain outstanding (other than contingent indemnity
obligations which by the terms thereof are stated to survive termination of the
Credit Documents) or any Credit Document or Secured Hedging Agreement is in
effect, and until all of the Commitments shall have been terminated, such
Obligor shall:

(a)           Other Liens.  Defend its interests in the Collateral against the
claims and demands of all other parties claiming an interest therein and keep
the Collateral free from all Liens, except, in each case, for Permitted Liens,
and not sell, exchange, transfer, assign, lease or otherwise dispose of the
Collateral or any interest therein and, except as permitted under the Credit
Agreement and the other Credit Documents.

(b)           Preservation of Collateral.  Keep all Material Collateral useful
and necessary in its business in good order, condition and repair, ordinary wear
and tear and obsolescence excepted; not use the Collateral in violation of the
provisions of this Security Agreement or any other agreement relating to the
Collateral or any policy insuring the Collateral or any applicable Requirement
of Law except for violations that could not reasonably be expected to have a
Material Adverse Effect; and not, without the prior written consent of the
Administrative Agent, alter or remove any identifying symbol or number on any
Material item of Equipment.

(c)           Possession or Control of Certain Collateral.  If (i) any amount
payable under or in connection with any of the Collateral in excess of $500,000
shall be or become evidenced by any Instrument, Tangible Chattel Paper or
Supporting Obligation or (ii) if any Collateral shall be stored or shipped
subject to a Document or (iii) if any Collateral in excess of $500,000 shall
consist of Investment Property in the form of certificated securities (other
than Cash Equivalents held in accordance with the Credit Agreement), promptly
notify the Administrative Agent of the existence of such Collateral and, at the
reasonable request of the Administrative Agent, deliver such Instrument, Chattel
Paper, Supporting Obligation, Document or Investment Property to the
Administrative Agent to be held as Collateral pursuant to this Security
Agreement.  If any Collateral shall consist of Material Deposit Accounts,
Material Electronic Chattel Paper, Material Letter-of-Credit Rights or

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Material uncertificated Investment Property, promptly execute and deliver (and,
with respect to any Collateral consisting of uncertificated Investment Property,
cause the issuer or Securities Intermediary with respect to such Investment
Property to execute and deliver) to the Administrative Agent all control
agreements, assignments, instruments or other documents as reasonably requested
by the Administrative Agent for the purposes of obtaining and maintaining
Control of such Collateral.

(d)           Changes in Corporate Structure or Location.  Not, without
providing 30 days prior written notice to the Administrative Agent and without
filing (or confirming that the Administrative Agent has filed) such amendments
to any previously filed financing statements as the Administrative Agent may
require, (i) alter its corporate existence or, in one transaction or a series of
transactions, merge into or consolidate with any other entity, or sell all or
substantially all of its assets, except as permitted by the Credit Agreement,
(ii) change its state of incorporation or formation or (iii) change its
registered corporate name.

(e)           Inspection.  Allow the Administrative Agent or its representatives
to visit and inspect the Collateral as set forth in Section 5.6 of the Credit
Agreement.

(f)            Perfection of Security Interest. Each Obligor hereby authorizes
the Administrative Agent to prepare and file such financing statements
(including continuation statements) or amendments thereof or supplements thereto
or other instruments as the Administrative Agent may from time to time deem
necessary or appropriate in order to perfect and maintain the security interests
granted on the Collateral hereunder except with respect to perfection only, for
Collateral that is subject to a Permitted Lien under subsections (xi) and (xii)
of the definition of Permitted Lien in accordance with the UCC.  Each Obligor
shall also execute and deliver to the Administrative Agent such agreements,
assignments or instruments (including affidavits, notices, reaffirmations and
amendments and restatements of existing documents, as the Administrative Agent
may reasonably request) and do all such other things as the Administrative Agent
may reasonably deem necessary or appropriate (i) to assure to the Administrative
Agent its security interests hereunder are perfected in accordance with the UCC,
including, without limitation, (A) any financing statement that describes the
Collateral as “all personal property” or “all assets” or in some other manner as
the Administrative Agent deems necessary or advisable, (B) such financing
statements (including continuation statements) or amendments thereof or
supplements thereto or other instruments as the Administrative Agent may from
time to time reasonably request in order to perfect and maintain the security
interests granted hereunder in accordance with the UCC and any other personal
property security legislation in the appropriate state(s) or province(s), (C)
with regard to Investment Property, execute and cause any Securities
Intermediary with respect to such Investment Property to execute a securities
control agreement in form and substance satisfactory to the Administrative
Agent, (D) with regard to registered Material Copyrights, a Notice of Grant of
Security Interest in Copyrights for filing with the United States Copyright
Office in the form of Schedule 5(f)(i) attached hereto, (E) with regard to
Material Patents, a Notice of Grant of Security Interest in Patents for filing
with the United States Patent and Trademark Office in the form of

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Schedule 5(f)(ii) attached hereto and (F) with regard to Material Trademarks, a
Notice of Grant of Security Interest in Trademarks for filing with the United
States Patent and Trademark Office in the form of Schedule 5(f)(iii) attached
hereto, (ii) to consummate the transactions contemplated hereby and (iii) to
otherwise protect and assure the Administrative Agent of its rights and
interests hereunder.  To that end, each Obligor hereby irrevocably makes,
constitutes and appoints the Administrative Agent, its nominee or any other
person whom the Administrative Agent may designate, as such Obligor’s attorney
in fact with full power and for the limited purpose to sign in the name of such
Obligor any such notices or similar documents which in the Administrative
Agent’s reasonable discretion would be necessary or appropriate in order to
perfect and maintain perfection of the security interests granted hereunder
other than, with respect to perfection only, in Vehicles and Collateral that is
subject to a Permitted Lien under subsections (xi) and (xii) of the definition
of Permitted Lien, such power, being coupled with an interest, being and
remaining irrevocable so long as the Credit Agreement is in effect or any
amounts payable thereunder, under any other Credit Document or any Secured
Hedging Agreement shall remain outstanding (other than contingent indemnity
obligations which by the terms thereof are stated to survive termination of the
Credit Documents, and until all of the Commitments thereunder shall have
terminated.  In the event for any reason the law of any jurisdiction other than
North Carolina becomes or is applicable to the Collateral of any Obligor or any
part thereof, or to any of the Secured Obligations, such Obligor agrees to
execute and deliver all such instruments and to do all such other things as the
Administrative Agent reasonably deems necessary or appropriate to preserve,
protect and enforce the security interests of the Administrative Agent under the
law of such other jurisdiction other than, with respect to perfection only, in
Vehicles and Collateral that is subject to a Permitted Lien under subsections
(xi) and (xii) of the definition of Permitted Lien (and, if an Obligor shall
fail to do so promptly upon the request of the Administrative Agent, then the
Administrative Agent may execute any and all such requested documents on behalf
of such Obligor pursuant to the power of attorney granted hereinabove).  Each
Obligor agrees to mark its books and records to reflect the security interest of
the Administrative Agent in the Collateral.

(g)           Collateral Held by Warehouseman, Bailee, etc.  If any Collateral
exceeding an aggregate value of $500,000 is at any time in the possession or
control of a warehouseman, bailee or any agent or processor of such Obligor
(except if under repair or refurbishment), notify the Administrative Agent of
such possession and, upon the Administrative Agent’s reasonable request, notify
such Person of the Administrative Agent’s security interest for the benefit of
the Lenders in such Collateral and instruct such Person to hold all such
Collateral for the Administrative Agent’s account subject to the Administrative
Agent’s instructions, and obtain from such Person a written acknowledgement of
the Administrative Agent’s security interest therein, in form and substance
reasonably satisfactory to the Administrative Agent.

(h)           Treatment of Accounts.  Unless and until an Event of Default
occurs and is continuing, each Obligor may settle and adjust disputes and claims
with its franchisees, customers and account debtors, handle returns and
recoveries and grant discounts, credit

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and allowances in the ordinary course of its business as presently conducted and
otherwise for amounts and on terms which such Obligor in good faith considers
advisable.  However, upon the occurrence of any Event of Default and during the
continuation thereof, if so instructed by the Administrative Agent, such Obligor
shall settle and adjust disputes and claims as directed by the Administrative
Agent, and no discount, credit or allowance other than on normal trade terms in
the ordinary course of business shall be granted to any customer or account
debtor and no returns of merchandise shall be accepted by such Obligor without
the Administrative Agent’s consent.  The Administrative Agent may (but shall not
be required to) at all times upon the occurrence of any Event of Default and
during the continuance thereof, settle or adjust disputes and claims directly
with customers or account debtors for amounts and upon terms which the
Administrative Agent considers reasonable.

(i)            Covenants Relating to Inventory.

(i)            Maintain, keep and preserve all Material Inventory in accordance
with standard operating procedures.

(ii)           If any Inventory exceeding an aggregate value of $500,000 is at
any time evidenced by a document of title, deliver such document of title to the
Administrative Agent.

(j)            Covenants Relating to Copyrights.

(i)            Employ the Copyrights for each Work with such notice of copyright
as may be required by law to secure copyright protection.

(ii)           Not do any act or knowingly omit to do any act whereby any
Material Copyright may become invalidated and (A) not do any act, or knowingly
omit to do any act, whereby any Material Copyright may become injected into the
public domain; (B) notify the Administrative Agent immediately if it knows, or
has reason to know, that any Material Copyright may become injected into the
public domain or of any adverse determination or development (including, without
limitation, the institution of, or any such determination or development in, any
proceeding in any court or tribunal in the United States or any other country)
regarding an Obligor’s ownership of any such Copyright or its validity; (C) take
all necessary steps as it shall deem appropriate under the circumstances, to
maintain and pursue each application (and to obtain the relevant registration)
and to maintain each registration of each Material Copyright owned by an Obligor
including, without limitation, filing of applications for renewal where
necessary; and (D) promptly notify the Administrative Agent of any material
infringement of any Material Copyright of an Obligor of which it becomes aware
and take such actions as it shall reasonably deem appropriate under the
circumstances to protect such Copyright, including, where appropriate, the
bringing of suit for infringement,

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seeking injunctive relief and seeking to recover any and all damages for such
infringement.

(iii)          Not make any assignment or agreement in conflict with the
security interest in the Copyrights of each Obligor hereunder.

(k)           Covenants Relating to Patents and Trademarks.

(i)            (A) Continue to use each Material Trademark in full force free
from any claim of abandonment for non-use, unless such Material Trademark is
abandoned or no longer used in the ordinary course of business, (B) maintain as
in the past the quality of products and services offered under such Material
Trademark, (C) employ such Material Trademark with the appropriate notice of
registration, (D) not adopt or use any mark which is confusingly similar or a
colorable imitation of such Material Trademark unless the Administrative Agent,
for the ratable benefit of the Lenders, shall obtain a perfected security
interest in such mark pursuant to this Security Agreement, and (E) not (and not
permit any licensee or sublicensee thereof to) do any act or knowingly omit to
do any act whereby any such Material Trademark may become invalidated.

(ii)           Not do any act, or omit to do any act, whereby any Material
Patent may become abandoned or dedicated.

(iii)          Notify the Administrative Agent immediately if it knows, or has
reason to know, that any application or registration relating to any Material
Patent or Material Trademark may become abandoned or dedicated, or of any
adverse determination or development (including, without limitation, the
institution of, or any such determination or development in, any proceeding in
the United States Patent and Trademark Office or any court or tribunal in any
country) regarding an Obligor’s ownership of any such Patent or Trademark or its
right to register the same or to keep and maintain the same.

(iv)          Whenever an Obligor, either by itself or through an agent,
employee, licensee or designee, shall file an application for the registration
of any Patent or Trademark with the United States Patent and Trademark Office or
any similar office or agency in any other country or any political subdivision
thereof, such Obligor shall report such filing to the Administrative Agent
within five Business Days after the last day of the fiscal quarter in which such
filing occurs.  Upon request of the Administrative Agent, an Obligor shall
execute and deliver any and all agreements, instruments, documents and papers as
the Administrative Agent may request to evidence the Administrative Agent’s and
the Lenders’ security interest in any Patent or Trademark and the goodwill and
General Intangibles of an Obligor relating thereto or represented thereby.

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(v)           Take all reasonable and necessary steps, including, without
limitation, in any proceeding before the United States Patent and Trademark
Office, or any similar office or agency in any other country or any political
subdivision thereof, to maintain and pursue each application, to obtain the
relevant registration and to maintain each registration of all Material Patents
and Material Trademarks, unless such Material Patents and Material Trademarks
have been abandoned or are no longer used in the ordinary course of business,
including, without limitation, filing of applications for renewal, affidavits of
use and affidavits of incontestability.

(vi)          Promptly notify the Administrative Agent and the Lenders after it
learns that any Material Patent or Material Trademark included in the Collateral
is infringed, misappropriated or diluted by a third party and promptly sue for
infringement, misappropriation or dilution, to seek injunctive relief where
appropriate and to recover any and all damages for such infringement,
misappropriation or dilution, or take such other actions as it shall reasonably
deem appropriate under the circumstances to protect such Patent or Trademark.

(vii)         Not make any assignment or agreement in conflict with the security
interest in the Patents or Trademarks of each Obligor hereunder.

(l)            New Patents, Copyrights and Trademarks.  Promptly provide the
Administrative Agent (i) with respect to Material Copyrights, a duly executed
Notice of Grant of Security Interest in Copyrights, (ii) with respect to
Material Patents, a duly executed Notice of Grant of Security Interest in
Patents, (iii) with respect to Material Trademarks, a duly executed Notice of
Grant of Security Interest in Trademarks or (iv) such other duly executed
documents as the Administrative Agent may reasonably request in a form
acceptable to counsel for the Administrative Agent and suitable for recording to
evidence the security interest of the Administrative Agent on behalf of the
Lenders in the Copyright, Patent or Trademark which is the subject of such new
application.

(m)          Commercial Tort Claims; Notice of Litigation.  (i) Promptly forward
to the Administrative Agent written notification of any and all Commercial Tort
Claims, including, but not limited to, any and all actions, suits, and
proceedings before any court or Governmental Authority by such Obligor or any of
its Subsidiaries and (ii) execute and deliver such statements, documents and
notices and do and cause to be done all such things as may be reasonably
required by the Administrative Agent, or required by law, including all things
which may from time to time be necessary under the UCC to fully create,
preserve, perfect and protect the priority of the Administrative Agent’s
security interest in any Commercial Tort Claims.

(n)           Insurance.  Insure, repair and replace the Collateral of such
Obligor as set forth in Section 5.5 of the Credit Agreement.  All proceeds
derived from insurance on the Collateral shall be subject to the security
interest of the Administrative Agent hereunder.

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(o)           Fixtures.  At all times maintain the Collateral existing as of the
Closing Date as personal property and not affix any of such Collateral to any
real property (except real property in which the Administrative Agent has a
valid, perfected and first priority security interest or that is subject to a
Permitted Lien to the extent such Collateral may be encumbered by a Permitted
Lien) in a manner which would change its nature from personal property to real
property or a Fixture.

6.             Performance of Obligations; Advances by Administrative Agent.  On
failure of any Obligor to perform any of the covenants and agreements contained
herein, the Administrative Agent may, at its sole option and in its sole
discretion, perform or cause to be performed the same and in so doing may expend
such sums as the Administrative Agent may reasonably deem advisable in the
performance thereof, including, without limitation, the payment of any insurance
premiums, the payment of any taxes, a payment to obtain a release of a Lien or
potential Lien (other than a Permitted Lien), expenditures made in defending
against any adverse claim (other than a Permitted Lien) and all other
expenditures which the Administrative Agent may make for the protection of the
security interest hereof or may be compelled to make by operation of law.  All
such sums and amounts so expended shall be repayable by the Obligors on a joint
and several basis promptly upon timely notice thereof and demand therefor, shall
constitute additional Secured Obligations and shall bear interest from the date
said amounts are expended at the ABR Default Rate.  No such performance of any
covenant or agreement by the Administrative Agent on behalf of any Obligor, and
no such advance or expenditure therefor, shall relieve the Obligors of any
default under the terms of this Security Agreement, the other Credit Documents
or any Secured Hedging Agreement.  The Administrative Agent may make any payment
hereby authorized in accordance with any bill, statement or estimate procured
from the appropriate public office or holder of the claim to be discharged
without inquiry into the accuracy of such bill, statement or estimate or into
the validity of any tax assessment, sale, forfeiture, tax lien, title or claim
except to the extent such payment is being contested in good faith by an Obligor
in appropriate proceedings and against which adequate reserves are being
maintained in accordance with GAAP.

7.             Events of Default.

The occurrence of an event, which under the Credit Agreement would constitute an
Event of Default, shall be an event of default hereunder (an “Event of
Default”).

8.             Remedies.

(a)           General Remedies.  Upon the occurrence of an Event of Default and
during continuation thereof, the Administrative Agent and the Lenders shall
have, in addition to the rights and remedies provided herein, in the Credit
Documents, in any Secured Hedging Agreement or by law (including, but not
limited to, levy of attachment, garnishment, and the rights and remedies set
forth in the Uniform Commercial Code of the jurisdiction applicable to the
affected Collateral), the rights and remedies of a secured party under the UCC
(regardless of whether the UCC is the law of the jurisdiction where the rights
and remedies are asserted and regardless of whether the UCC applies to the
affected Collateral),

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and further, the Administrative Agent may, with or without judicial process or
the aid and assistance of others, to the extent permitted by law, (i) enter on
any premises on which any of the Collateral may be located and, without
resistance or interference by the Obligors, take possession of the Collateral,
(ii) dispose of any Collateral on any such premises, (iii) require the Obligors
to assemble and make available to the Administrative Agent at the expense of the
Obligors any Collateral at any place and time designated by the Administrative
Agent which is reasonably convenient to both parties, (iv) remove any Collateral
from any such premises for the purpose of effecting sale or other disposition
thereof, and/or (v) without demand and without advertisement, notice, hearing or
process of law, all of which each of the Obligors hereby waives to the fullest
extent permitted by law, at any place and time or times, sell and deliver any or
all Collateral held by or for it at public or private sale, by one or more
contracts, in one or more parcels, for cash, upon credit or otherwise, at such
prices and upon such terms as the Administrative Agent deems advisable, in its
sole discretion (subject to any and all mandatory legal requirements).  Neither
the Administrative Agent’s compliance with any applicable state or federal law
in the conduct of such sale, nor its disclaimer of any warranties relating to
the Collateral, shall be considered to adversely affect the commercial
reasonableness of such sale.  In addition to all other sums due the
Administrative Agent and the Lenders with respect to the Secured Obligations,
the Obligors shall pay the Administrative Agent and each of the Lenders all
reasonable documented costs and expenses incurred by the Administrative Agent or
any such Lender, including, but not limited to, reasonable attorneys’ fees and
court costs, in obtaining or liquidating the Collateral, in enforcing payment of
the Secured Obligations, or in the prosecution or defense of any action or
proceeding by or against the Administrative Agent or the Lenders or the Obligors
concerning any matter arising out of or connected with this Security Agreement,
any Collateral or the Secured Obligations, including, without limitation, any of
the foregoing arising in, arising under or related to a case under the
Bankruptcy Code.  To the extent the rights of notice cannot be legally waived
hereunder, each Obligor agrees that any requirement of reasonable notice shall
be met if such notice is personally served on or mailed, postage prepaid, to the
applicable Obligor in accordance with the notice provisions of Section 9.2 of
the Credit Agreement at least 10 days before the time of sale or other event
giving rise to the requirement of such notice.  The Administrative Agent and the
Lenders shall not be obligated to make any sale or other disposition of the
Collateral regardless of notice having been given.  To the extent permitted by
law, any Lender may be a purchaser at any such sale.  To the extent permitted by
applicable law, each of the Obligors hereby waives all of its rights of
redemption with respect to any such sale.  Subject to the provisions of
applicable law, the Administrative Agent and the Lenders may postpone or cause
the postponement of the sale of all or any portion of the Collateral by
announcement at the time and place of such sale, and such sale may, without
further notice, to the extent permitted by law, be made at the time and place to
which the sale was postponed, or the Administrative Agent and the Lenders may
further postpone such sale by announcement made at such time and place.

(b)           Remedies Relating to Accounts.  Upon the occurrence of an Event of
Default and during the continuation thereof, whether or not the Administrative
Agent has exercised any or all of its rights and remedies hereunder, each
Obligor will promptly upon

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request of the Administrative Agent instruct all account debtors to remit all
payments in respect of Accounts to a mailing location selected by the
Administrative Agent.  In addition, upon the occurrence of an Event of Default
and during the continuation thereof, the Administrative Agent or its designee
may notify any Obligor’s customers and account debtors that the Accounts of such
Obligor have been assigned to the Administrative Agent or of the Administrative
Agent’s security interest therein, and may (either in its own name or in the
name of an Obligor or both) demand, collect (including, without limitation, by
way of a lockbox arrangement), receive, take receipt for, sell, sue for,
compound, settle, compromise and give acquittance for any and all amounts due or
to become due on any Account, and, in the Administrative Agent’s discretion,
file any claim or take any other action or proceeding to protect and realize
upon the security interest of the Administrative Agent in the Accounts.  Each
Obligor acknowledges and agrees that the Proceeds of its Accounts remitted to or
on behalf of the Administrative Agent for the benefit of the Lenders in
accordance with the provisions hereof shall be applied to the Secured
Obligations in the order set forth in Section 2.11(b) of the Credit Agreement 
and that such Obligor shall not have any right, title or interest in such
Proceeds or in any such other amounts except as expressly provided herein.  The
Administrative Agent and the Lenders shall have no liability or responsibility
to any Obligor for acceptance of a check, draft or other order for payment of
money bearing the legend “payment in full” or words of similar import or any
other restrictive legend or endorsement or be responsible for determining the
correctness of any remittance.  Each Obligor hereby agrees to indemnify the
Administrative Agent and the Lenders and their respective officers, directors,
employees, partners, members, counsel, agents, representatives, advisors and
affiliates from and against all liabilities, damages, losses, actions, claims,
judgments, costs, expenses, charges and reasonable attorneys’ fees suffered or
incurred by the Administrative Agent or the Lenders (each, an “Indemnified
Party”) because of the maintenance of the foregoing arrangements except as
relating to or arising out of the gross negligence or willful misconduct of an
Indemnified Party or its officers, employees or agents, in which case such
Indemnified Party shall not be entitled to the indemnification provisions
hereunder.  In the case of any investigation, litigation or other proceeding,
the foregoing indemnity shall be effective whether or not such investigation,
litigation or proceeding is brought by an Obligor, its directors, shareholders
or creditors or an Indemnified Party or any other Person or any other
Indemnified Party is otherwise a party thereto.

(c)           Access.  In addition to the rights and remedies hereunder, upon
the occurrence of an Event of Default and during the continuation thereof, the
Administrative Agent shall have the right to enter and remain upon the various
premises of the Obligors without cost or charge to the Administrative Agent, and
use the same, together with materials, supplies, books and records of the
Obligors for the purpose of collecting and liquidating the Collateral, or for
preparing for sale and conducting the sale of the Collateral, whether by
foreclosure, auction or otherwise.  In addition, the Administrative Agent may
remove Collateral, or any part thereof, from such premises and/or any records
with respect thereto, in order to effectively collect or liquidate such
Collateral.  If the Administrative Agent exercises its right to take possession
of the Collateral, each Obligor shall also at its expense perform any and all
other steps reasonably requested by the Administrative

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Agent to preserve and protect the security interest hereby granted in the
Collateral, such as placing and maintaining signs indicating the security
interest of the Administrative Agent, appointing overseers for the Collateral
and maintaining inventory records.

(d)           Nonexclusive Nature of Remedies.  Failure by the Administrative
Agent or the Lenders to exercise any right, remedy or option under this Security
Agreement, any other Credit Document, any Secured Hedging Agreement or as
provided by law, or any delay by the Administrative Agent or the Lenders in
exercising the same, shall not operate as a waiver of any such right, remedy or
option.  No waiver hereunder shall be effective unless it is in writing, signed
by the party against whom such waiver is sought to be enforced and then only to
the extent specifically stated, which in the case of the Administrative Agent or
the Lenders shall only be granted as provided herein.  To the extent permitted
by law, neither the Administrative Agent, the Lenders, nor any party acting as
attorney for the Administrative Agent or the Lenders, shall be liable hereunder
for any acts or omissions or for any error of judgment or mistake of fact or law
other than their gross negligence or willful misconduct hereunder.  The rights
and remedies of the Administrative Agents and the Lenders under this Security
Agreement shall be cumulative and not exclusive of any other right or remedy
which the Administrative Agent or the Lenders may have.

(e)           Retention of Collateral.  In addition to the rights and remedies
hereunder, upon the occurrence of any Event of Default and during the
continuation thereof, the Administrative Agent may retain all or a portion of
the Collateral in satisfaction of the Secured Obligations but only after
providing the notices required by Sections 9-620 and 9-621 (or similar
provision) of the UCC (or any successor sections of the UCC) and otherwise
complying with the requirements of applicable law of the relevant jurisdiction. 
Unless and until the Administrative Agent shall have provided such notices and
complied with all applicable legal requirements, however, the Administrative
Agent shall not be deemed to have retained any Collateral in satisfaction of any
Secured Obligations for any reason.

(f)            Deficiency.  In the event that the proceeds of any sale,
collection or realization are insufficient to pay all amounts to which the
Administrative Agent or the Lenders are legally entitled, the Obligors shall be
jointly and severally liable for the deficiency, together with interest thereon
at the ABR Default Rate, together with the costs of collection and the
reasonable fees of any attorneys employed by the Administrative Agent to collect
such deficiency.  Any surplus remaining after the full payment and satisfaction
of the Secured Obligations shall be returned to the Obligors or to whomsoever a
court of competent jurisdiction shall determine to be entitled thereto.

(g)           Other Security.  To the extent that any of the Secured Obligations
are now or hereafter secured by property other than the Collateral (including,
without limitation, real property and securities owned by an Obligor), or by a
guarantee, endorsement or property of any other Person, then the Administrative
Agent and the Lenders shall have the right to proceed against such other
property, guarantee or endorsement upon the

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occurrence of any Event of Default, and the Administrative Agent and the Lenders
have the right, in their sole discretion, to determine which rights, security,
liens, security interests or remedies the Administrative Agent and the Lenders
shall at any time pursue, relinquish, subordinate, modify or take with respect
thereto, without in any way modifying or affecting any of them or any of the
Administrative Agent’s and the Lenders’ rights or the Secured Obligations under
this Security Agreement, under any other of the Credit Documents or under any
Secured Hedging Agreement.

9.             Rights of the Administrative Agent.

(a)           Power of Attorney.  In addition to other powers of attorney
contained herein, each Obligor hereby designates and appoints the Administrative
Agent, on behalf of the Lenders, and each of its designees or agents, as
attorney-in-fact of such Obligor, irrevocably and with power of substitution,
with authority to take any or all of the following actions upon the occurrence
and during the continuation of an Event of Default:

(i)            to demand, collect, settle, compromise, adjust, give discharges
and releases, all as the Administrative Agent may reasonably determine;

(ii)           to commence and prosecute any actions at any court for the
purposes of collecting any Collateral and enforcing any other right in respect
thereof;

(iii)          to defend, settle, adjust or compromise any action, suit or
proceeding brought and, in connection therewith, give such discharge or release
as the Administrative Agent may deem reasonably appropriate;

(iv)          to receive, open and dispose of mail addressed to an Obligor and
endorse checks, notes, drafts, acceptances, money orders, bills of lading,
warehouse receipts or other instruments or documents evidencing payment,
shipment or storage of the goods giving rise to the Collateral of such Obligor,
or securing or relating to such Collateral, on behalf of and in the name of such
Obligor;

(v)           to sell, assign, transfer, endorse, make any agreement in respect
of, or otherwise deal with or exercise rights in respect of, any Collateral or
the goods or services which have given rise thereto, as fully and completely as
though the Administrative Agent were the absolute owner thereof for all
purposes;

(vi)          to adjust and settle claims under any insurance policy relating
thereto;

(vii)         to execute and deliver and/or file all assignments, conveyances,
statements, financing statements, continuation statements, security agreements,
affidavits, notices and other agreements, instruments and documents that the
Administrative Agent may determine necessary in order to perfect and maintain
the

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security interests and liens granted in this Security Agreement and in order to
fully consummate all of the transactions contemplated herein;

(viii)        to institute any foreclosure proceedings that the Administrative
Agent may deem appropriate; and

(ix)           to do and perform all such other acts and things as the
Administrative Agent may reasonably deem to be necessary or appropriate in
connection with the Collateral.

This power of attorney is a power coupled with an interest and shall be
irrevocable for so long as any of the Secured Obligations remain outstanding
(other than contingent indemnity obligations which by the terms thereof are
stated to survive termination of the Credit Documents), any Credit Document or
any Secured Hedging Agreement is in effect, and until all of the Commitments
shall have been terminated.  The Administrative Agent shall be under no duty to
exercise or withhold the exercise of any of the rights, powers, privileges and
options expressly or implicitly granted to the Administrative Agent in this
Security Agreement, and shall not be liable for any failure to do so or any
delay in doing so.  The Administrative Agent shall not be liable for any act or
omission or for any error of judgment or any mistake of fact or law in its
individual capacity or its capacity as attorney-in-fact except acts or omissions
resulting from its gross negligence or willful misconduct.  This power of
attorney is conferred on the Administrative Agent solely to protect, preserve
and realize upon its security interest in the Collateral.

(b)           Assignment by the Administrative Agent.  The Administrative Agent
may from time to time assign its rights and obligations hereunder as permitted
under the Credit Agreement and any portion thereof and/or the Collateral and any
portion thereof, and the assignee shall be entitled to all of the rights and
remedies of the Administrative Agent under this Security Agreement in relation
thereto.

(c)           The Administrative Agent’s Duty of Care.  Other than the exercise
of reasonable care to assure the safe custody of the Collateral while being held
by the Administrative Agent hereunder, the Administrative Agent shall have no
duty or liability to preserve rights pertaining thereto, it being understood and
agreed that the Obligors shall be responsible for preservation of all rights in
the Collateral, and the Administrative Agent shall be relieved of all
responsibility for the Collateral upon surrendering it or tendering the
surrender of it to the Obligors.  The Administrative Agent shall be deemed to
have exercised reasonable care in the custody and preservation of the Collateral
in its possession if the Collateral is accorded treatment substantially equal to
that which the Administrative Agent accords its own property, which shall be no
less than the treatment employed by a reasonable and prudent agent in the
industry, it being understood that the Administrative Agent shall not have
responsibility for taking any necessary steps to preserve rights against any
parties with respect to any of the Collateral.  In the event of a public or
private sale of Collateral pursuant to Section 8 hereof, the Administrative
Agent shall have no obligation to clean-up, repair or otherwise prepare the
Collateral for sale.

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10.           Application of Proceeds.  Upon the occurrence and during the
continuation of an Event of Default, any payments in respect of the Secured
Obligations and any proceeds of the Collateral, when received by the
Administrative Agent or any of the Lenders in cash or its equivalent, will be
applied in reduction of the Secured Obligations in the order set forth in
Section 2.11(b) of the Credit Agreement, and each Obligor irrevocably waives the
right to direct the application of such payments and proceeds and acknowledges
and agrees that the Administrative Agent shall have the continuing and exclusive
right to apply and reapply any and all such payments and proceeds in the order
set forth in Section 2.11(b) of the Credit Agreement, notwithstanding any entry
to the contrary upon any of its books and records.

11.           Costs of Counsel.  If at any time hereafter, whether upon the
occurrence of an Event of Default or not, the Administrative Agent employs
counsel to prepare or consider amendments, waivers or consents with respect to
this Security Agreement, or to take action or make a response in or with respect
to any legal or arbitral proceeding relating to this Security Agreement or
relating to the Collateral, or to protect the Collateral or exercise any rights
or remedies under this Security Agreement or with respect to the Collateral,
then the Obligors agree to promptly pay upon demand any and all such reasonable
documented costs and expenses of the Administrative Agent, all of which costs
and expenses shall constitute Secured Obligations hereunder.

12.           Continuing Agreement.

(a)           Upon this Security Agreement becoming effective in accordance with
the terms hereof and of the other Credit Documents, the Existing Security
Agreement shall be deemed amended and restated by this Security Agreement.  This
Security Agreement shall be a continuing agreement in every respect and shall
remain in full force and effect so long as any of the Secured Obligations remain
outstanding (other than contingent indemnity obligations which by the terms
thereof are stated to survive termination of the Credit Documents) or any Credit
Document or any Secured Hedging Agreement is in effect, and until all of the
Commitments thereunder shall have terminated.  Upon such payment and
termination, this Security Agreement shall be automatically terminated without
delivery of any instrument or performance of any act by any Person and the
Administrative Agent and the Lenders shall, upon the request and at the expense
of the Obligors, forthwith release all liens and security interests granted
hereunder and shall execute and deliver all UCC termination statements and/or
other documents reasonably requested by the Obligors evidencing such
termination.  Notwithstanding the foregoing all releases and indemnities
provided hereunder shall survive termination of this Security Agreement.

(b)           This Security Agreement shall continue to be effective or be
automatically reinstated, as the case may be, if at any time payment, in whole
or in part, of any of the Secured Obligations is rescinded or must otherwise be
restored or returned by the Administrative Agent or any Lender as a preference,
fraudulent conveyance or otherwise under any bankruptcy, insolvency or similar
law, all as though such payment had not been made; provided that in the event
payment of all or any part of the Secured Obligations is rescinded or must be
restored or returned, all reasonable costs and expenses (including

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without limitation any reasonable legal fees and disbursements) incurred by the
Administrative Agent or any Lender in defending and enforcing such reinstatement
shall be deemed to be included as a part of the Secured Obligations.

13.           Amendments; Waivers; Modifications.  This Security Agreement and
the provisions hereof may not be amended, waived, modified, changed, discharged
or terminated except as set forth in Section 9.1 of the Credit Agreement.

14.           Successors in Interest.  This Security Agreement shall create a
continuing security interest in the Collateral and shall be binding upon each
Obligor, its successors and assigns and shall inure, together with the rights
and remedies of the Administrative Agent and the Lenders hereunder, to the
benefit of the Administrative Agent and the Lenders and their successors and
permitted assigns; provided, however, that none of the Obligors may assign its
rights or delegate its duties hereunder without the prior written consent of
each Lender or the Required Lenders, as required by the Credit Agreement.  To
the fullest extent permitted by law, each Obligor hereby releases the
Administrative Agent and each Lender, each of their respective officers,
employees and agents, and each of their successors and assigns, from any
liability for any act or omission relating to this Security Agreement or the
Collateral, except for any liability arising from the gross negligence or
willful misconduct of such Person.

15.           Notices.  All notices required or permitted to be given under this
Security Agreement shall be in conformance with Section 9.2 of the Credit
Agreement.

16.           Counterparts.  This Security Agreement may be executed in any
number of counterparts, each of which where so executed and delivered shall be
an original, but all of which shall constitute one and the same instrument.  It
shall not be necessary in making proof of this Security Agreement to produce or
account for more than one such counterpart.  Delivery of executed counterparts
of the Security Agreement by telecopy shall be effective as an original and
shall constitute a representation that an original shall be delivered upon the
request of the Administrative Agent.

17.           Headings.  The headings of the sections and subsections hereof are
provided for convenience only and shall not in any way affect the meaning,
construction or interpretation of any provision of this Security Agreement.

18.           Governing Law; Submission to Jurisdiction; Waiver of Jury Trial;
Venue. THIS SECURITY AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NORTH CAROLINA.  The terms of Sections 9.14 and 9.18 of
the Credit Agreement are incorporated herein by reference, mutatis mutandis, and
the parties hereto agree to such terms.

19.           Severability.  If any provision of any of the Security Agreement
is determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining

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provisions shall remain in full force and effect and shall be construed without
giving effect  to the illegal, invalid or unenforceable provisions.

20.           Entirety.  This Security Agreement, the other Credit Documents and
the Secured Hedging Agreements represent the entire agreement of the parties
hereto and thereto, and supersede all prior agreements and understandings, oral
or written, if any, including any commitment letters or correspondence relating
to this Security Agreement, the other Credit Documents, the Secured Hedging
Agreements or the transactions contemplated herein and therein.

21.           Survival.  All representations and warranties of the Obligors
hereunder shall survive the execution and delivery of this Security Agreement,
the other Credit Documents and the Secured Hedging Agreements, the delivery of
the Notes and the making of the Loans and the issuance of the Letters of Credit
under the Credit Agreement.

22.           Joint and Several Obligations of Obligors.

(a)           Each of the Obligors is accepting joint and several liability
hereunder in consideration of the financial accommodation to be provided by the
Lenders under the Credit Agreement, for the mutual benefit, directly and
indirectly, of each of the Obligors and in consideration of the undertakings of
each of the Obligors to accept joint and several liability for the obligations
of each of them.

(b)           Each of the Obligors jointly and severally hereby irrevocably and
unconditionally accepts, not merely as a surety but also as a co-debtor, joint
and several liability with the other Obligors with respect to the payment and
performance of all of the Secured Obligations arising under this Security
Agreement, the other Credit Documents and the Secured Hedging Agreements, it
being the intention of the parties hereto that all the Secured Obligations shall
be the joint and several obligations of each of the Obligors without preferences
or distinction among them.

(c)           Notwithstanding any provision to the contrary contained herein or
in any other of the Credit Documents, to the extent the obligations of an
Obligor shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations of such
Obligor hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including, without
limitation, the Bankruptcy Code).

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Each of the parties hereto has caused a counterpart of this Security Agreement
to be duly executed and delivered as of the date first above written.

OBLIGORS:

 

RED ROBIN INTERNATIONAL, INC.,

 

a Nevada corporation

 

 

 

 

 

 

 

By:

/s/ Katherine L. Scherping

 

 

Name: Katherine L. Scherping

 

Title: Chief Financial Officer

 

 

 

 

 

 

 

RED ROBIN GOURMET BURGERS, INC.,

 

a Delaware corporation

 

RED ROBIN WEST, INC.,

 

a Nevada corporation

 

RED ROBIN DISTRIBUTING COMPANY, INC.,

 

a Colorado corporation

 

WESTERN FRANCHISE DEVELOPMENT, INC.,

 

a California corporation

 

 

 

 

 

 

 

By:

/s/ Katherine L. Scherping

 

 

Name: Katherine L. Scherping

 

Title: Chief Financial Officer

 

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ADMINISTRATIVE AGENT:

WACHOVIA BANK, NATIONAL ASSOCIATION,

 

as Administrative Agent

 

 

 

 

 

 

 

By:

/s/ Kevin Lilly

 

 

Name: Kevin Lilly

 

Title: Vice President

 

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