Exhibit 10.4

NEW WORLD RESTAURANT GROUP, INC.        STOCK OPTION PLAN FOR INDEPENDENT DIRECTORS        Effective January 1, 2004

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Table of Contents

|            |      |                                             |                                                        | Page
|----------- | ---- | ------------------------------------------- | ------------------------------------------------------ | ----
|ARTICLE I   |      | GENERAL                                     |                                                        | 1   
|            | 1.1  |                                             | Definitions                                            |     
|            | 1.2  |                                             | Nature of Options                                      |     
|ARTICLE II  |      | PLAN ADMINISTRATION                         |                                                        | 1   
|            | 2.1  |                                             | Duties and Powers of Board                             |     
|            | 2.2  |                                             | Professional Assistance and Good Faith Actions         |     
|ARTICLE III |      | OPTIONS                                     |                                                        | 1   
|            | 3.1  |                                             | Eligibility                                            |     
|            | 3.2  |                                             | Grant                                                  |     
|            | 3.3  |                                             | Terms                                                  |     
|ARTICLE IV  |      | STOCK SUBJECT TO THE PLAN                   |                                                        | 3   
|            | 4.1  |                                             | Number of Shares                                       |     
|            | 4.2  |                                             | Unused and Forfeited Stock                             |     
|            | 4.3  |                                             | Adjustments for Stock Split, Stock Dividends, Etc      |     
|            | 4.4  |                                             | Dividend Payable in Stock of Another Corporation, Etc. |     
|            | 4.5  |                                             | Other Changes in Stock                                 |     
|            | 4.6  |                                             | Rights to Subscribe                                    |     
|            | 4.7  |                                             | General Adjustment Rules                               |     
|            | 4.8  |                                             | Determination by the Board, Etc                        |     
|ARTICLE V   |      | CORPORATE REORGANIZATION; CHANGE OF CONTROL |                                                        | 4   
|            | 5.1  |                                             | Adjustment of Options                                  |     
|            | 5.2  |                                             | Assumption or Substitution of Options                  |     
|            | 5.3  |                                             | Corporate Transaction                                  |     
|            | 5.4  |                                             | Deductibility under Code § 280G                        |     
|ARTICLE VI  |      | GENERAL PROVISIONS                          |                                                        | 6   
|            | 6.1  |                                             | Stockholder Approval                                   |     
|            | 6.2  |                                             | Termination of Plan                                    |     
|            | 6.3  |                                             | Amendments, Etc                                        |     
|            | 6.4  |                                             | Treatment of Proceeds                                  |     
|            | 6.5  |                                             | Fair Market Value                                      |     
|            | 6.6  |                                             | Rights as Stockholders                                 |     
|            | 6.7  |                                             | Conditions to Issuance of Stock Certificates           |     
|            | 6.8  |                                             | No Right to Continued Membership on Board              |     
|            | 6.9  |                                             | No Assignment                                          |     
|            | 6.10 |                                             | Tax Withholding                                        |     
|            | 6.11 |                                             | Section Headings                                       |     
|            | 6.12 |                                             | Severability                                           |     
|            | 6.13 |                                             | Rule 16b-3                                             |     

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NEW WORLD RESTAURANT GROUP, INC.
STOCK OPTION PLAN
FOR NON-EMPLOYEE DIRECTORS

The Board of Directors of New World Restaurant Group, Inc. (the "Board"), a Delaware corporation (the "Company"), hereby establishes the New World
Restaurant Group, Inc. Stock Option Plan for Independent Directors (the "Plan"), effective January 1, 2004 (the "Effective Date").

PURPOSES

The purposes of the Plan are to provide Independent Directors of the Company added incentive to continue in the service of the Company and a more direct interest
in the future success of the operations of the Company by granting to such directors options ("Options") to purchase shares of the $.001 par value common stock (the "Stock") of the Company upon the
terms and conditions described below.

ARTICLE I
GENERAL

1.1Definitions.For purposes of the Plan and as used herein, an "Independent Director" is an individual who (a) is a
member of the Board of Directors of the Company and (b) meets the criteria set forth in § 301 of the Sarbanes-Oxley Act of 2002 and related guidance. An Independent Director to whom
an Option is granted is referred to herein as a "Holder." The agreement between the Company and the Independent Director containing the terms of an Option is referred to as a "Stock Option Agreement."

1.2Nature of Options.The Options granted hereunder shall be options that do not satisfy the incentive stock option
requirements of section 422 of the Code.

ARTICLE II
PLAN ADMINISTRATION

2.1Duties and Powers of Board.The Plan shall be administered by the Board. The Board shall conduct the general
administration of the Plan in accordance with its provisions. The Board's duties and powers shall include, but not be limited to, the power to interpret the Plan and the Stock Option Agreements, to
correct any defect, supply any omission or reconcile any inconsistency in the Plan or in any Stock Option Agreement, to determine the rights of all Independent Directors and other interested persons
hereunder, and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules.

2.2Professional Assistance and Good Faith Actions.All expenses and liabilities incurred by members of the Board in
connection with the administration of the Plan shall be borne by the Company. The Board may employ attorneys, consultants, accountants, appraisers, brokers or other persons. The Board, the Company,
and its officers shall be entitled to rely upon the advice, opinions or valuations of any such persons. All actions taken and all interpretations and determinations made by the Board in good faith
shall be final and binding upon all Independent Directors, the Company, and all other interested persons. No member of the Board shall be personally liable for any action, determination, or
interpretation made in good faith with respect to the Plan or the Options, and all members of the Board shall be fully protected by the Company in respect to any such action, determination or
interpretation.

ARTICLE III
OPTIONS

3.1Eligibility.The Independent Directors on the Effective Date and each Independent Director elected thereafter shall be
eligible to receive Options to purchase Stock in accordance with Section 3.2 on the terms and conditions herein described.

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3.2Grant.Subject to stockholder approval of the Plan, on the first day of each January during the term of this Plan, each
individual then serving as an Independent Director shall be granted an Option to purchase 10,000 shares of Stock.

3.3Terms.As soon as possible after an Independent Director becomes entitled to the grant of an Option under
Section 3.2, the Secretary of the Company shall issue such Option and shall cause to be executed a Stock Option Agreement for the number of Options granted, which shall be executed by such
Independent Director and an authorized officer of the Company. In the event of any inconsistency between the provisions of the Plan and any Stock Option Agreement entered into hereunder, the
provisions of the Plan shall govern. Options issued pursuant to the Plan shall have the following terms and conditions in addition to those set forth elsewhere herein:



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ARTICLE IV
STOCK SUBJECT TO THE PLAN

4.1Number of Shares.A total of 200,000 shares are authorized for issuance under the Plan in accordance with the provisions
of the Plan. This authorization may be further increased from time to time by approval of the Board and by the stockholders of the Company if, in the opinion of counsel for the Company, such
stockholder approval is required. Shares of Stock that may be issued upon the exercise of Options shall be applied to reduce the maximum number of shares remaining available for use under the Plan.
The Company shall at all times during the term of the Plan and while any Options are outstanding retain as authorized and unissued Stock, or as treasury Stock, at least the number of shares from time
to time required under the provisions of the Plan, or otherwise assure itself of its ability to perform its obligations hereunder.

4.2Unused and Forfeited Stock.Any shares of Stock that are subject to an Option under this Plan that are not used because
the terms and conditions of the Option are not met, including any shares that are subject to an Option that expires or is terminated for any reason, shall automatically become available for use under
the Plan. Any shares of Stock that are used to pay the Option Price shall not become available for the grant of Options under the Plan.

4.3Adjustments for Stock Split, Stock Dividends, Etc.If the Company shall at any time increase or decrease the number of
its outstanding shares of Stock or change in any way the rights and privileges of such shares by means of the payment of a stock dividend or any other distribution upon such shares payable in Stock,
or through a stock split, subdivision, consolidation, combination, reclassification or recapitalization involving the Stock, then in relation to the Stock that is affected by one or more of the above
events, the numbers, rights and privileges of the following shall be increased, decreased or changed in like manner as if they had been issued and outstanding, fully paid and nonassessable at the time
of such occurrence: (i) the shares of Stock as to which Options may be granted under the Plan; and (ii) the shares of Stock then subject to each outstanding Option.

4.4Dividend Payable in Stock of Another Corporation, Etc.If the Company shall at any time pay or make any dividend or other
distribution to the holders of Stock payable in securities of another corporation or other property (except money or Stock), a proportionate part of such securities or other property shall be set
aside and delivered to any Holder then holding an Option for the particular type of Stock for which the dividend or other distribution was made, upon exercise thereof. Prior to the time that any such
securities or other property are delivered to a Holder in accordance with the foregoing, the Company shall be the owner of such securities or other property and shall have the right

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to
vote the securities, receive any dividends payable on such securities, and in all other respects shall be treated as the owner. If securities or other property that have been set aside by the
Company in accordance with this Section are not delivered to a Holder because an Option is not exercised, then such securities or other property shall remain the property of the Company and shall be
dealt with by the Company as it shall determine in its sole discretion.

4.5Other Changes in Stock.If there shall be any change, other than as specified in Sections 4.3 and 4.4, in the number or
kind of outstanding shares of Stock or of any stock or other securities into which the Stock shall be changed or for which it shall have been exchanged, and if the Board shall in its discretion
determine that such change equitably requires an adjustment in the number or kind of shares subject to outstanding Options or which have been reserved for issuance pursuant to the Plan but are not
then subject to an Option, then such adjustments shall be made by the Board and shall be effective for all purposes of the Plan and on each outstanding Option that involves the particular type of
stock for which a change was effected.

4.6Rights to Subscribe.If the Company shall at any time grant to the holders of its Stock rights to subscribe pro ratafor additional shares thereof or for any
other securities of the Company or of any other corporation, there shall be reserved with respect to
the shares then subject to an Option held by any Holder of the particular class of Stock involved, the Stock or other securities which the Holder would have been entitled to subscribe for if
immediately prior to such grant the Holder had exercised his entire Option. If, upon exercise of any such Option, the Holder subscribes for the additional Stock or other securities, the Holder shall
pay to the Company the price that is payable by the Holder for such Stock or other securities.

4.7General Adjustment Rules.No adjustment or substitution provided for in this Article IV shall require the Company
to issue a fractional share under any Option and the total substitution or adjustment with respect to each Option shall be limited by deleting any fractional share. In the case of any such
substitution or adjustment, the purchase price with respect to each such Option shall be equitably adjusted by the Board to reflect the greater or lesser number of shares of Stock or other securities
into which the Stock subject to the Option may have been changed.

4.8Determination by the Board, Etc.Adjustments under this Article IV shall be made by the Board, whose
determinations with regard thereto shall be final and binding.

ARTICLE V
CORPORATE REORGANIZATION; CHANGE OF CONTROL

5.1Adjustment of Options.Upon the occurrence of a Corporate Transaction (as defined in Section 5.3), the Board shall
take any one or more of the following actions with respect to outstanding Options:



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The
Board need not take the same action with respect to all outstanding Options or to all outstanding Options of the same type.

5.2Assumption or Substitution of Options.The Company, or the successor or purchaser, as the case may be, may make adequate
provision for the assumption of the outstanding Options or the substitution of new options for the outstanding Options on terms comparable to the outstanding Options.

5.3Corporate Transaction.A Corporate Transaction shall include the following:



The
terms "beneficially own", "beneficial owner" and "Group" shall have the meanings ascribed to such terms in Sections 13(d) and 14(d) of the Exchange Act;provided,
however, that, for the purposes of this definition of "Change of Control" only, any Person or Group other than the Greenlight Capital Offshore Ltd. shall be deemed to be
the current beneficial owner of any shares of voting Stock of the Company, or any interests or participations in, or measured by the profits of, the Company, that are

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issuable
upon the exercise of any option, warrant or similar right, or upon the conversion of any convertible security, in either case owned by such Person or Group without regard to whether such
option, warrant or convertible security is currently exercisable or convertible or will become convertible or exercisable within 60 days if the exercise or conversion price thereof at the time
of grant was lower than the fair market value of the underlying security at the time of grant; or



5.4Deductibility under Code § 280G.Notwithstanding the provisions of Section 5.1, Options that are not
otherwise exercisable at the time of a Corporate Transaction shall only become exercisable as described in Section 5.1 or cancelled and settled for cash or other consideration as permitted
under Section 5.1 to the extent such exercise and issuance of shares of Stock or payment with respect to a particular non-employee director continues to be deductible by the Company
pursuant to Code § 280G.

ARTICLE VI
GENERAL PROVISIONS

6.1Stockholder Approval.The Plan will be submitted for the approval of the Company's stockholders within 12 months
after the date of the Board's initial adoption of the Plan. No Options shall be exercised under the Plan prior to approval of the Plan by the Company's stockholders.

6.2Termination of Plan.The Plan shall terminate whenever the Board adopts a resolution to that effect. After termination,
no additional Options shall be granted under the Plan, but Options outstanding at the time of the Plan termination may continue to be exercised in accordance with their terms.

6.3Amendments, Etc.The Board may from time to time amend, modify, suspend or terminate the Plan. Nevertheless, no such
amendment, modification, suspension, or termination shall impair any Option theretofore granted under the Plan or deprive any Holder of any shares of Stock that he may have acquired through or as a
result of the Plan without the consent of the Holder. The Company shall obtain the approval of stockholders to any amendment or modification of the Plan to the extent required by
Rule 16b-3 under the Exchange Act (or any successor applicable rule) or by the listing requirements of the National Association of Securities Dealers, Inc. or any stock
exchange on which the Company's securities are quoted or listed for trading.

6.4Treatment of Proceeds.Proceeds from the sale of Stock pursuant to Options granted under the Plan shall constitute
general funds of the Company.

6.5Fair Market Value.means, as of a given date, (i) the closing price of a share of Stock on the principal stock
exchange on which the Stock is then trading, if any (or as reported on any composite index that includes such principal exchange) on such date, or if shares were not traded on such date, then on the
next preceding date on which a trade occurred; or (ii) if the Stock is not traded on an exchange but is quoted on Nasdaq or a successor quotation system, the mean between the closing
representative bid and asked prices for the Stock on such date as reported by Nasdaq or such successor quotation system; or (iii) if the Stock is not publicly traded on an exchange and not
quoted on Nasdaq or a successor quotation system, the Fair Market Value of a share shall be determined by the Board acting in good faith.

6.6Rights as Stockholders.The Holders of Options shall not be, nor have any of the rights or privileges of, stockholders of
the Company with respect to any shares of Stock purchasable upon the exercise of any part of an Option unless and until certificates representing such shares of Stock have been issued by the Company
to such Holders.

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6.7Conditions to Issuance of Stock Certificates.Stock shall not be issued with respect to an Option granted hereunder
unless the exercise of such Option and the issuance and delivery of shares of Stock pursuant thereto shall comply with all relevant provisions of law, including the law of the Company's state of
incorporation, the Securities Act of 1933, the Exchange Act, the rules and regulations thereunder and the requirements of any stock exchange upon which the Stock may then be listed, and shall be
further subject to the approval of the Company's counsel with respect to such compliance. The Plan, the grant and exercise of an Option to purchase shares of Stock hereunder, and the Company's
obligation to sell and deliver shares upon the exercise of rights to purchase shares shall be subject to all applicable federal and state laws, rules and regulations, and to such approvals by any
regulatory or governmental agency which may, in the opinion of counsel for the Company, be required.

6.8No Right to Continued Membership on Board.Nothing in this Plan or in any Stock Option Agreement hereunder shall confer
upon any Independent Director any right to continue as a director of the Company or shall interfere with or restrict in any way the rights of the Company and its stockholders, which are hereby
expressly reserved, to remove any Independent Director at any time for any reason whatsoever, with or without cause.

6.9No Assignment.No right or interest of any Option Holder in an Option granted pursuant to the Plan shall be assignable or
transferable during the lifetime of the Option Holder, either voluntarily or involuntarily, or be subjected to any lien, directly or indirectly, by operation of law, or otherwise, including execution,
levy, garnishment, attachment, pledge or bankruptcy.

6.10Tax Withholding.The Company shall be entitled to require payment or deduction from other compensation payable to each
Independent Director of any sums required by federal, state or local tax laws to be withheld with respect to any Option. The Board may in its discretion allow such Independent Director to elect to
have the Company withhold shares of Stock (or allow the return of shares of Stock) having a Fair Market Value equal to the sums required to be withheld. If the Director elects to advance such sums
directly, written notice of that election shall be delivered on or prior to such exercise and, whether pursuant to such election or pursuant to a requirement imposed by the Company, payment by check
of such sums for taxes shall be delivered within two days after the date of exercise. If, as allowed by the Board, the Director elects to have the Company withhold shares of Stock (or allow the return
of shares of Stock) having a Fair Market Value equal to sums required to be withheld, the value of the shares of Stock to be withheld (or returned, as the case may be) will be equal to the Fair Market
Value of such shares on the date that the amount of tax to be withheld is to be determined (the "Tax Date"). Elections by such persons to have shares of Stock withheld for this purpose will be subject
to the following restrictions: (1) the election must be made on or prior to the Tax Date, (2) the election must be irrevocable, (3) the election shall be subject to the
disapproval of the Board, and (4) the election shall be subject to such additional restrictions as the Board may impose in an effort to secure the benefits of any regulations under
Section 16 of the Exchange Act. The Board shall not be obligated to issue shares and/or distribute cash to any person upon exercise of any Option until such payment has been received or shares
have been so withheld, unless withholding (or offset against a cash payment) as of or prior to the date of such exercise is sufficient to cover all such sums due or which may be due with respect to
such exercise.

6.11Section Headings.The Section headings are included herein only for convenience, and they shall have no effect on the
interpretation of the Plan.

6.12Severability.If any article, section, subsection or specific provision is found to be illegal or invalid for any
reason, such illegality or invalidity shall not effect the remaining provisions of the Plan, and the Plan shall be construed and enforced as if such illegal and invalid provision had never been set
forth in the Plan.

6.13Rule 16b-3.This Plan is intended to comply with the requirements of Rule 16b-3
under the Exchange Act and any successor applicable rule so that grants under the Plan will satisfy the

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requirements
of Rule 16b-3 under the Exchange Act. To the extent the Plan does not conform to such requirements, it shall be deemed amended to so conform without any further action
on the part of the Board of Directors or stockholders.

|      |  |                |  | NEW WORLD RESTAURANT GROUP, INC.,a Delaware corporation
|----- |  | -------------- |  | -------------------------------------------------------
|Date: |  | March 26, 2004 |  | By:                                                    

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