EXHIBIT
10.29

    


    
      FRANCHISE
AGREEMENT

    

     

    

    


    EL POLLO LOCO® FRANCHISE
AGREEMENT

    


    Dated:
____________________

    


    
      	
              Location:

            
	 
      
	
              Franchisee:

            
	 
      
	
              Franchisee
      Notice Address:

            
	 
      
	
              Franchisee
      Notice Facsimile Number:

            


    

    


    Disclosure Document Control
No. 033109v.2


    
      
         


      

      
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    EL POLLO LOCO® FRANCHISE
AGREEMENT

    


    INDEX

    


    
      
        	
                Section

              	
                Page

              
	 
      	 
      	 
      
	
                1.

              	
                SCOPE
      AND PURPOSE OF AGREEMENT

              	
                 4

              
	 
      	 
      	 
      
	
                2.

              	
                THE
      EL POLLO LOCO®
      MARKS AND SYSTEM

              	
                 5

              
	 
      	 
      	 
      
	
                3.

              	
                TERM

              	
                 7

              
	 
      	 
      	 
      
	
                4.

              	
                SITE
      DEVELOPMENT

              	
                 7

              
	 
      	 
      	 
      
	
                5.

              	
                IMPROVEMENTS,
      FIXTURES AND EQUIPMENT

              	
                10

              
	 
      	 
      	 
      
	
                6.

              	
                FEES,
      TAXES AND OTHER CHARGES

              	
                13

              
	 
      	 
      	 
      
	
                7.

              	
                FINANCIAL
      REPORTING, BILLING AND PAYMENT

              	
                14

              
	 
      	 
      	 
      
	
                8.

              	
                REGIONAL
      ADVERTISING AND MARKETING

              	
                18

              
	 
      	 
      	 
      
	
                9.

              	
                INSURANCE
      AND INDEMNIFICATION

              	
                21

              
	 
      	 
      	 
      
	
                10.

              	
                VENDING
      MACHINES

              	
                23

              
	 
      	 
      	 
      
	
                11.

              	
                COMPLIANCE
      WITH MANUAL AND WITH SYSTEM STANDARDS

              	
                23

              
	 
      	 
      	
                 
      

              
	
                12.

              	
                RESTAURANT
      MAINTENANCE AND REPAIR

              	
                26

              
	 
      	 
      	 
      
	
                13.

              	
                HOURS
      OF OPERATION

              	
                27

              
	 
      	 
      	 
      
	
                14.

              	
                PERSONNEL
      STANDARDS

              	
                27

              
	 
      	 
      	 
      
	
                15.

              	
                INSPECTIONS

              	
                28

              
	 
      	 
      	 
      
	
                16.

              	
                TRAINING

              	
                29

              
	 
      	 
      	 
      
	
                17.

              	
                ASSIGNMENT

              	
                31

              
	 
      	 
      	 
      
	
                18.

              	
                DEFAULT
      AND TERMINATION

              	
                38

              
	 
      	 
      	 
      
	
                19.

              	
                RIGHTS
      AND OBLIGATIONS UPON TERMINATION

              	
                41

              
	 
      	 
      	 
      
	
                20.

              	
                RIGHTS
      TO A SUCCESSOR FRANCHISE

              	
                43

              
	 
      	 
      	 
      
	
                21.

              	
                PROPRIETARY
      RIGHTS AND UNFAIR COMPETITION

              	
                44

              
	 
      	 
      	 
      
	
                22.

              	
                RESOLUTION
      OF DEVELOPMENT DISPUTES

              	
                49

              
	 
      	 
      	 
      
	
                23.

              	
                MISCELLANEOUS
      PROVISIONS

              	
                50

              
	 
      	 
      	 
      
	
                24.

              	
                INTERFERENCE
      WITH EMPLOYMENT RELATIONS

              	
                55

              
	 
      	 
      	 
      
	
                24.

              	
                EFFECTIVE
      DATE

              	
                55

              
	 
      	 
      	 
      
	
                25.

              	
                ACKNOWLEDGMENTS

              	
                55

              
	 
      	 
      	 
      
	
                26.

              	
                SIGNATURES

              	
                55

              


      

    


    
      
         


      

      
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    EXHIBITS
& SCHEDULES TO FRANCHISE AGREEMENT

    


    
      	
              EXHIBIT 1: 

            	
              PROCEDURES
      FOR RESOLVING DISPUTES RELATING TO THE DEVELOPMENT OF NEW
      RESTAURANTS

            
	 
      	 
      
	
              EXHIBIT 2:

            	
              MEMORANDUM
      OF OPENING DATE

            
	 
      	 
      
	
              EXHIBIT 3:

            	
              PERSONAL
      GUARANTEE

            
	 
      	 
      
	
              EXHIBIT 4:

            	
              INVESTOR
      COVENANTS REGARDING CONFIDENTIALITY AND NON-COMPETITION
      (FRANCHISEE)

            
	 
      	 
      
	
              EXHIBIT 5:

            	
              AUTHORIZATION
      FOR PREARRANGED PAYMENTS (DIRECT DEBITS)

            
	 
      	 
      
	
              EXHIBIT 6:

            	
              ADVERTISING
      ASSOCIATION DOCUMENTS

            
	 
      	 
      
	
              EXHIBIT 7:

            	
              FINANCIAL
      REPORTING FORM

            
	 
      	 
      
	
              EXHIBIT 8:

            	
              EL
      POLLO LOCO® IT
      SUPPORT SERVICES AGREEMENT

            
	 
      	 
      
	
              EXHIBIT 9:

            	
              GENERAL
      RELEASE

            
	 
      	 
      
	
              EXHIBIT 10:

            	
              CONSENT
      TO ASSIGNMENT OF FRANCHISE RIGHTS

            
	 
      	 
      
	
              SCHEDULE 1:

            	
              STATEMENT
      OF OWNERSHIP OF FRANCHISEE

            


    


    
      
         


      

      
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    EXHIBIT
10.29

     


    EL
POLLO LOCO®

    FRANCHISE
AGREEMENT

    


    This
Franchise Agreement ("Agreement"), dated for identification purposes only as of
 , 200__,
is made and entered into by and between EL POLLO LOCO, INC., a
Delaware corporation (the "Franchisor"), and   
("Franchisee").

    


    A.           The
Franchisor operates and franchises others to operate a number of retail outlets
for the sale of flame-broiled food items and related products, in connection
with the "El Pollo Loco" name and the Franchisor's distinctive plan of food
service operation.

    


    B.           Franchisee
desires to operate a restaurant under the Franchisor's name and to utilize the
Franchisor's plan of food service operation, all in accordance with the terms,
covenants and conditions of this Agreement.

    


    C.           Franchisee
understands that the success of the business contemplated by this Agreement is
subject to substantial risks and depends in large part on the business ability
of Franchisee and its active participation in the development and management of
the franchise business.

    


    
      	
              1.

            	
              SCOPE AND PURPOSE OF
      AGREEMENT

            


    

    


    1.1           Franchisee
desires to operate and manage an "El Pollo Loco" restaurant to be located at
___________________________________ City of  , County of
___________, State of   (the
"Location").  The Franchisor owns certain proprietary and other
property rights and interests in and to the "El Pollo Loco" trademark and
service mark, and such other trademarks, service marks, logo types, insignias,
trade dress designs and commercial symbols as Franchisor may from time to time
authorize or direct Franchisee to use in connection with the operation of a "El
Pollo Loco" Restaurant (the "El Pollo Loco®
Marks").  The Franchisor has a distinctive plan for the operation of
retail outlets for the sale of flame-broiled food items and related products,
which plan includes but is not limited to the El Pollo Loco® Marks
and the Operations Manual (the "Manual"), policies, standards, procedures,
recipes, employee uniforms, signs, menu boards and related items, and the
reputation and goodwill of the Franchisor's chain of restaurants (collectively,
the "El Pollo Loco®
System").  Therefore, in entering into this Agreement, Franchisee
fully understands and agrees that this Agreement is conditioned upon the
continued strict adherence by Franchisee to all standards, policies, procedures
and requirements published or which may from time to time be published or
otherwise brought to Franchisee's attention by the Franchisor for the operation,
maintenance or improvement of "El Pollo Loco" restaurants under the El Pollo
Loco® System
and the El Pollo Loco®
Marks.  Franchisee understands and agrees that strict adherence to
these standards, policies, procedures and requirements are essential to the
value of the El Pollo Loco® System
and the El Pollo Loco®
Marks.


    
      
         


      

      
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    1.2           Franchisee
represents that it is experienced in and has independent knowledge of the nature
and specifics of the restaurant business.  Franchisee understands that
there is not, nor can there be, any assurance or guaranty of success in the
franchise business and that Franchisee's business ability and attitude are
primary in determining Franchisee's success.  Franchisee represents
that, in entering into this Agreement, it has relied solely on its personal
knowledge and understanding and has not relied on any representation of the
Franchisor or any of its officers, directors, employees or agents, except those
representations contained in any legally required Disclosure Document delivered
to Franchisee.

    


    1.3           In
consideration of the foregoing representations and agreements of Franchisee and
other consideration as set forth herein, and subject to all of the terms,
covenants and conditions of this Agreement, the Franchisor hereby grants to
Franchisee, and Franchisee hereby accepts from the Franchisor, the right and
license to operate the one “El Pollo Loco” restaurant under the El Pollo
Loco® Marks
and in accordance with the El Pollo Loco® System
(the “Restaurant”) at the Location.  Franchisee acknowledges that the
franchise granted hereunder is only for the Location, and, as more fully
provided for at Section 23.13, Franchisee is not granted any area, market or
protected territorial rights.  Franchisee expressly acknowledges and
agrees that the Franchisor and its affiliates have and expressly reserve the
right to (a) operate and license others to operate El Pollo Loco®
restaurants at any location; and (b) merchandise and distribute goods and
services identified by the El Pollo Loco® Marks at
any location through any method or channel of distribution, including, without
limitation, grocery or convenience stores and via the Internet.

    


    1.4           It
is expressly understood and agreed by the parties that Franchisee is and shall
be an independent contractor, that Franchisee is not for any purpose an employee
or agent of the Franchisor, and that all of the personnel employed by Franchisee
at the Restaurant will be employees or agents of Franchisee as an independent
contractor and will not be employees or agents of the
Franchisor.  Franchisee understands and agrees that, as an independent
contractor, it does not have the authority to do anything for or on behalf of
the Franchisor including, but not limited to, holding itself out as the
Franchisor; signing contracts, notes or other instruments; purchasing, acquiring
or disposing of any property; or incurring any other obligation or
liability.

    


    2.        
    THE EL
POLLO LOCO® MARKS &
SYSTEM

    


    2.1           Upon
the terms, covenants and conditions contained herein and during the term hereof,
Franchisee shall have the right to display and use the El Pollo Loco®
Marks, but only for use in connection with retail sales and service of certain
food products which Franchisee is required to prepare and sell to the general
public in and at the Restaurant.

    


    2.2           Nothing
contained herein shall be construed as authorizing or permitting Franchisee to
use the El Pollo Loco®
Marks or the El Pollo Loco®
System at any location other than the Location or for any purpose or in any
manner other than that authorized herein; or in connection with the sale of any
products for resale, or any products not required or approved by the Franchisor,
or any products prepared at any place other than at the Location; provided,
however, that catering and special event sales may be undertaken by Franchisee
in strict adherence with the limitations and procedures set forth in the
Manual.  Notwithstanding anything to the contrary contained herein,
the Franchisor may require Franchisee to discontinue the preparation, offer or
sale of any product or item which, in the opinion of the Franchisor or any of
its representatives, does not conform to the quality standards or image of the
Franchisor and its products.


    
      
         


      

      
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    2.3           Nothing
contained herein shall give Franchisee any right, title or interest in or to any
of the El Pollo Loco®
Marks excepting only the privilege and license, during the term hereof, to
display and use the same according to the foregoing limitations.  Any
and all goodwill arising in connection with Franchisee's use of the El Pollo
Loco®
Marks and the El Pollo Loco®
System of restaurant operation shall belong to the Franchisor.

    


    2.4           Franchisee
agrees that the business franchised hereunder shall be named "El Pollo Loco"
without any suffix or prefix attached thereto. Franchisee shall use signs and
other advertising which denote that the Restaurant is named "El Pollo Loco" and
which are approved by the Franchisor in advance.  If Franchisee is
transferred to an Entity (as defined below), the name of such corporation shall
not contain any of the El Pollo Loco®
Marks.

    


    2.5           Except
as the Franchisor may otherwise permit in writing, Franchisee shall not display
or use the trademark, trade name, service mark, logo types, label, design or
other identifying symbol or name of any other person, or Entity in, on or at the
Restaurant or the Location.

    


    2.6           Franchisee
agrees that in all public records, in its relationship with other persons or
companies, and in any Disclosure Document, prospectus or similar document,
Franchisee shall indicate clearly that Franchisee's business is independently
owned and that the operations of said business are separate and distinct from
the operation of the Franchisor's business.  Franchisee shall display
at the Restaurant, in such locations as may be specified by the Franchisor and
in all correspondence and forms, a notification that the Restaurant is operated
by an independent operator and not by the Franchisor.

    


    2.7           Franchisee
shall not develop, create, generate, own, license, lease or use in any manner
any computer medium or electronic medium (including, without limitation, any
Internet home page, e-mail address, website, domain name, bulletin board,
newsgroup or other Internet-related medium) which in any way uses or displays,
in whole or in part, the El Pollo Loco®
Marks, or any of them, or any words, symbols or terms confusingly similar
thereto without Franchisor’s express written consent, and then only in such
manner and in accordance with such procedures, policies, standards and
specifications as Franchisor may establish from time to time.

    


    2.8           Franchisor
is the owner of, and will retain all right, title and interest in and to the
domain names “elpolloloco” and “crazychicken;” the URLs: www.elpolloloco.com,
www.elpolloloco.net,
www.elpolloloco.org,
www.elpollolocofranchising.com,
www.myepl.net,
www.crazychicken.com, www.epllogo.com
and www.eplmarketing.com; all existing and future domain names,
URLs, future addresses and subaddresses using the El Pollo Loco®
Marks in any manner; all software; all content prepared for, or used on, the
Website; and all intellectual property rights in and to any of
them.


    
      
         


      

      
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    3.    
        TERM

    


    3.1           The
term of this Agreement shall commence on the date Franchisor executes this
Agreement and shall end on the date which is the 20th
anniversary of the date Franchisee first opens the Restaurant to the public (the
"Opening Date"), unless sooner terminated as provided herein.  Should
Franchisee lease the site of the Restaurant, the lease must be for a term which
with renewal options is not less than the initial term of the Franchise
Agreement, and will contain the provisions required in Section 4.3 of the
Franchise Agreement.  Promptly following the Opening Date, the parties
shall execute a Memorandum of Opening Date attached as Exhibit 2 which shall confirm
the Opening Date; provided, however, if the parties fail to execute such
Memorandum of Opening Date, the Opening Date shall be as determined in good
faith by Franchisor.  Upon the expiration or earlier termination of
this Agreement, Franchisee shall have no right or option to extend the term of
this Agreement.  The sole conditions under which Franchisee will have
the opportunity to obtain a successor Franchise Agreement upon the expiration of
the term of this Agreement are set forth at Section 20.

    


    
      	
              4.

            	
               SITE
      DEVELOPMENT

            


    

    


    4.1           Franchisee
shall employ only those qualified development professionals (including
architectural firms, contractors and other real estate site development
professionals or consultants) who have been approved in writing by Franchisor
and who have executed the Preferred Development Professional
Agreement.

    


    4.2           Franchisee
shall submit a proposed site for the Restaurant for acceptance by Franchisor’s
Real Estate Site Approval Committee (“RESAC”), together with such site
information as may be reasonably required by Franchisor to evaluate the proposed
site.  Franchisor shall, provided there exists no default by
Franchisee under this Agreement or any other development, franchise or other
agreement between Franchisor and Franchisee, evaluate the site proposed for
which Franchisee has provided all necessary evaluation information, and shall
promptly, but not more than sixty (60) days after receipt of Franchisee’s
proposal, send to Franchisee written notice of acceptance or non-acceptance of
the site.  Franchisor shall send representatives to evaluate a
proposed site for the Restaurant, and Franchisor will do so at its own expense
for the first two (2) proposed sites for the Restaurant.  If
Franchisee proposes, and Franchisor evaluates, more than two (2) sites for the
Restaurant, then Franchisee shall reimburse Franchisor for the reasonable costs
and expenses incurred by Franchisor’s representatives in connection with the
evaluation of such additional proposed site(s), including, without limitation,
the costs of lodging, travel and meals.  In addition, as a condition
to reviewing a proposed site for the Restaurant, and to determine the impact a
proposed site may have on other existing restaurants operating under the El
Pollo Loco® System, Franchisor may require Franchisee to pay for a market study
conducted by a third party of the proposed site and the surrounding geographic
area.  Site approval does not assure that a Franchise Agreement will
be executed.  Execution of the Franchise Agreement is contingent upon
Franchisee purchasing or leasing the proposed site and satisfying all other
conditions imposed by Franchise Agreement upon the issuance of a
franchise.


    
      
         


      

      
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    4.3         Within
ninety (90) days after Franchisor has approved a site for the Restaurant,
Franchisee shall:

    


    
      	
               
      

            	
              a)

            	
              Submit
      in writing to Franchisor, satisfactory proof to Franchisor that
      Franchisee:

            


    

    
      	
               
      

            	
              (i)

            	
              owns
      the site or has entered into a written agreement to purchase the approved
      site on terms provided herein, subject, only to obtaining necessary
      governmental permits.  Should Franchisee purchase the site using
      another entity other than the franchise entity, Franchisee must then enter
      into a lease with the Franchisee’s entity as the lessee and the purchasing
      entity as the lessor.  Such lease needs to comply with Sections
      4.3 (ii) and 4.4 below. This process needs to be completed within ninety
      (90) days after Franchisor has approved a site for the Restaurant;
      or

            


    

    
      	
               
      

            	
              (ii)

            	
              has
      entered into a written agreement to lease the approved site on terms
      provided herein, subject, only to obtaining necessary governmental permits
      or franchisee has leased the site for a term which, with renewal options
      is not less than the initial term of the Franchise
      Agreement.  If Franchisee has leased the site, the lease shall
      contain the provisions required in Section 4.4 below.  The
      unexecuted form of the lease must be submitted to Franchisor to review for
      the required terms and conditions listed below in Section 4.4 prior to
      full execution of the lease.  Upon approval of the inclusion of
      such required terms and conditions, Franchisor will notify Franchisee of
      such approval.  Franchisee will then provide a final executed
      copy of the lease to Franchisor.  This process needs to be
      completed within ninety (90) days after Franchisor has approved a site for
      the Restaurant.

            


    

    


    4.4          After
execution of this Agreement, Franchisee will be required to achieve certain
milestones to assure the timely development of the Restaurant:

    


    a.           Franchisee
shall complete the acquisition of the Location, resulting in a fully executed
lease or recorded grant deed (for real property which includes the Location) in
the name of Franchisee within ninety (90) days following the date of
Franchisor’s execution of this Agreement; and

    


    b.           Within
six (6) months following the date of Franchisor’s execution of this Agreement,
Franchisee must have completed all of the site development work (including, but
not limited to, engineering, architectural/design, entitlements, and permitting)
and commence construction of the Restaurant.


    
      
         


      

      
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    c.           Within
twelve (12) months following the date of Franchisor’s execution of this
Agreement, or the date specified in the Development Agreement, if earlier,
Franchisee must have completed construction of the Restaurant at the Location
and the Restaurant shall be open to the public.

    


    The
Franchisor shall have no liability under any lease or purchase agreement for the
Restaurant location and shall not guaranty Franchisee’s obligations under the
same.  In the event that Franchisee executes a lease for the Location
site, Franchisee shall furnish to the Franchisor a copy of the executed lease
within fifteen (15) days of the date of execution of such
lease.  Franchisor shall have no obligation to assist Franchisee to
negotiate such lease.

    


    The lease
may not contain a non-competition covenant which restricts the Franchisor, or
any franchisee of the Franchisor, from operating an El Pollo Loco® Restaurant or any other
retail restaurant, unless such covenant is approved by the Franchisor in writing
prior to the execution of the lease.

    


    Any lease
entered into by Franchisee shall include the following terms and
conditions:

    


    i.           The
landlord consents to Franchisee's use of the premises as an El Pollo Loco® restaurant and such
restaurant may be open for business during the required days and hours set forth
in the Manual from time to time;

    


    ii.           The
landlord agrees to furnish the Franchisor with copies of any and all notices of
default, if any, pertaining to the lease and the premises, at the same time that
such notices are sent to Franchisee; and

    


    
      iii.          The
landlord agrees that, subject to any other applicable provisions in this
Agreement, the Franchisor shall have the right, at its sole option and without
any obligation whatsoever to do so, to assume Franchisee's occupancy rights
under the lease for the remainder of its term upon Franchisee's default or
termination under such lease, the termination of this Agreement, or the exercise
by the Franchisor of its right of first refusal or right to purchase as set
forth at Sections 17 and 19 of this Agreement.

    

    


    iv.           That
upon expiration or termination of the lease for any reason, Franchisee shall,
upon Franchisor’s demand, remove all of the El Pollo Loco® Marks from the Restaurant
and the Location and modify the decor of the Restaurant and Location so that it
no longer resembles, in whole or in part, a "El Pollo Loco" restaurant and that
if Franchisee shall fail do so, Franchisor will be given written notice and the
right to enter the Location to make such alterations, in which event Franchisee
shall reimburse Franchisor for all direct and indirect costs and expense it may
incur in connection therewith, including attorney’s fees.


    4.5         If
Franchisee purchases a currently operating Restaurant from the Franchisor (a
“Turnkey Restaurant”), then Franchisee shall begin operation of the Restaurant
on the date possession of the Restaurant is transferred to Franchisee pursuant
to the agreement entered into between Franchisee and the Franchisor for the
purchase of Restaurant.  Failure to reach each milestone described in
Sections 4.3 and 4.4 above within the specified time frames shall constitute a
material default hereunder.  Prior to opening the Restaurant,
Franchisee shall obtain and thereafter maintain throughout the term of this
Agreement all necessary business licenses, permits and other documentation
necessary for the operation of an El Pollo Loco®
restaurant.

     

    
      
        
        

      

      
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    4.6           Franchisee
understands and acknowledges that in accepting Franchisee’s Location, or by
granting a franchise for a Location (whether or not formerly operated as a
Franchisor or franchisee-owned Restaurant), the Franchisor does not in any way
endorse, warrant or guarantee either directly or indirectly the suitability of
such Location or the success of the franchise business to be operated by
Franchisee at such Location.  The suitability of the Location and the
success of the franchise business depends upon a number of factors outside of
the Franchisor's control including, but not limited to, the Franchisee’s
operational abilities, site location, consumer trends and such other factors
that are within the direct control of the Franchisee.  Franchisor may
require, as a condition to its approval of a site, a site description and
analysis, traffic and other demographic information, all in such format as the
Franchisor may require, which information shall include, without limitation, a
study prepared by a third party reasonably acceptable to the Franchisor
analyzing the impact of the proposed site on other franchised restaurants
surrounding or within the vicinity of such proposed site.  All such
analyses, information and studies shall be prepared at the sole cost and expense
of Franchisee.

    


    5.        
    IMPROVEMENTS, FIXTURES AND
EQUIPMENT

    


    5.1           If
the Location is other than a Turnkey Restaurant, then this Section 5 will apply
to the building, reconstruction, remodeling, or other changes necessary to
conform the Location to the requirements set forth in this Section or as
provided and updated by the Franchisor from time to time in accordance with this
Section.

    


    5.2           Franchisee,
at its sole expense, shall construct or, in the case of an existing building,
remodel the Location and install such signs, fixtures, furniture and equipment
at the Location as are required in accordance with the Franchisor's current
requirements and specifications for same.  Franchisee shall be
responsible for obtaining all zoning classifications and clearances which may be
required by state or local laws, ordinances or
regulations.  Franchisee shall obtain from applicable governmental
authorities all permits, licenses and certifications required for lawful
construction or remodeling work and for the operation of the
Restaurant.  If requested by the Franchisor, Franchisee shall submit
to the Franchisor a copy of all such required permits, licenses and
certifications for the construction or remodeling work prior to commencing the
construction or remodeling of the Location.


    
      
         


      

      
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    5.3           The
Franchisor shall provide Franchisee with standard plans and a sample layout for
a typical El Pollo Loco®
restaurant and a set of typical construction, equipment and decor specifications
(the "Plans").  At all times, Franchisee shall use its best efforts to
treat and keep the Plans and the information contained therein as confidential
as possible and limit access to the Plans to employees and independent
contractors of Franchisee on a need to know basis only (including preferred
development professionals).  Franchisee acknowledges that the
unauthorized use or disclosure of the Franchisor's Plans and the confidential
information contained therein will cause irreparable injury to the Franchisor
and that damages are not an adequate remedy.  Franchisee accordingly
covenants that without the Franchisor's prior written consent, Franchisee shall
not disclose (except to such employees, agents, contractors or subcontractors as
must have access to such Plans in order to construct the Restaurant at the
Location) or use or permit the use of such Plans (except as may be required by
applicable law or authorized by this Agreement), or copy, duplicate, record or
otherwise reproduce such Plans, in whole or in part, or otherwise make the same
available to any person or source not authorized in writing by the Franchisor to
receive such Plans or the information contained therein at any time during the
term of this Agreement or thereafter.

    


    5.4           Franchisee,
at its sole expense, shall employ approved architects, designers, engineers,
development consultants or others who have signed the Preferred Developer
Professional Agreement (“PDPA”) as may be necessary to complete, substitute,
adapt or modify the Plans for the Restaurant so as to create a set of final
plans and specifications.  Creating a set of final plans and
specifications may include, but is not limited to, adapting plans for structural
engineering, architectural requirements, interior and exterior materials,
locally available building materials, local weather requirements and federal,
state  and local code requirements.  In some cases, these
can lead to substantial changes and costs in the provided
plans.  FRANCHISEE SHALL SUBMIT TO THE FRANCHISOR A COMPLETE SET OF
FINAL PLANS AND SPECIFICATIONS, INCLUDING A SITE PLAN, AND OBTAIN THE
FRANCHISOR'S WRITTEN APPROVAL OF SUCH PLANS AND SPECIFICATIONS PRIOR TO
COMMENCING THE CONSTRUCTION OF THE RESTAURANT OR, IN THE CASE OF AN EXISTING
BUILDING, THE REMODELING WORK FOR THE RESTAURANT.  The Franchisor
shall review such final plans and specifications promptly and approve or
disapprove the same, and the Franchisor may provide comments on the plans and
specifications to Franchisee.  Such review and approval by the
Franchisor will be limited to items and issues relating to the El Pollo
Loco®
System only and is not intended to be a verification or approval of the
structure of the building, mechanical systems or document
accuracy.  Examples of conceptual areas related to the El Pollo
Loco®
System include signs, logos, finishes, decor and aesthetics, guest comfort, and
ability to serve food within the Franchisor's standards for quality, timeliness
and cleanliness.


    
      
         


      

      
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    5.5          Franchisee
shall use a qualified licensed general contractor who has signed the PDPA to
perform the construction or remodeling work at the
Restaurant.  Franchisees general contractor shall provide a schedule
to the Franchisor before the start of construction.  The Franchisor
shall not be responsible for delays in the construction, equipping or decoration
of the Restaurant or for any loss resulting from the Restaurant design or
construction.  The Franchisor must approve in writing any and all
changes in the Restaurant plans relating to the El Pollo Loco®
System, as described in Section 5.4 above, prior to the construction or
remodeling of the Restaurant or the implementation of such
changes.  FRANCHISEE SHALL PROVIDE WRITTEN NOTICE TO THE FRANCHISOR OF
THE DATE UPON WHICH CONSTRUCTION OF THE RESTAURANT COMMENCED WITHIN SEVEN (7)
DAYS AFTER COMMENCEMENT AND THEREAFTER SHALL PROVIDE TO THE FRANCHISOR MONTHLY
PROGRESS REPORTS OF THE STATUS OF THE CONSTRUCTION WORK SIGNED BY FRANCHISEE'S
ARCHITECT OR GENERAL CONTRACTOR.  Franchisee's failure to commence the
design, construction or remodeling, equipping and opening of the Restaurant
promptly and with due diligence shall be grounds for the termination of this
Agreement.  The Franchisor shall make a final inspection of the
completed Restaurant and Location and may require such corrections and
modifications as it deems necessary to bring the Restaurant and the Location
into compliance with approved final plans and
specifications.  FRANCHISEE SHALL NOTIFY THE FRANCHISOR OF THE DATE OF
COMPLETION OF CONSTRUCTION AND, WITHIN A REASONABLE TIME THEREAFTER, THE
FRANCHISOR SHALL CONDUCT THE FINAL INSPECTION OF THE RESTAURANT AND ITS
PREMISES.  Franchisee acknowledges and agrees that Franchisee shall
not open the Restaurant for business without the express written authorization
of the Franchisor and that the Franchisor's authorization to open shall be
conditioned upon Franchisee's furnishing to the Franchisor:

    


    a.           A
letter from the general contractor responsible for the construction or
remodeling of the Restaurant indicating that the Restaurant has been constructed
or remodeled in substantial conformance with the approved final plans and
specifications, including any changes thereto approved by the Franchisor, and in
accordance with all applicable state and local governmental laws, statutes and
ordinances regulating such construction including, without limitation, building,
fire, health and safety codes; and

    


    b.           A
temporary or final Certificate of Occupancy issued by the applicable local
governmental entity.

    


    5.6          Franchisee
shall, at its sole expense, purchase all required signs, fixtures, furniture and
equipment for the Restaurant and Location from a distributor listed on the
Approved Brands and Distributors List (as defined below) or another distributor
approved pursuant to Section 11.4.  The items purchased shall be
installed in strict accordance with the specifications of the Franchisor and
erected and displayed in the manner and at such locations as are approved and
authorized by the Franchisor in writing.  Franchisee shall maintain
and display signs which reflect the current image of El Pollo Loco®
restaurants and shall not place additional signs at the Restaurant without the
prior written consent of the Franchisor.  Franchisee shall discontinue
the use of and remove, or modify, as applicable, such signs that are declared
obsolete by the Franchisor within thirty (30) days after Franchisee’s receipt of
the Franchisor’s written request, subject to reasonable extension if Franchisee
is unable after using reasonable diligence to obtain required governmental
approvals for modification of such signs.  Proper signage is
fundamental to the El Pollo Loco®
System and Franchisee hereby grants to the Franchisor the right to enter the
Restaurant in order to remove and de-identify any unapproved or obsolete signs
in the event Franchisee has failed to do so within the above-specified time
frame.


    
      
         


      

      
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    5.7          Franchisee
is solely responsible for the acts or omissions of its contractors regarding
compliance with all of the provisions of this Section 5, and the Franchisor
shall have no responsibility for such acts or omissions.  The
Franchisor shall not be liable for any loss or damage arising from the design or
plan of the Restaurant by reason of its approval of plans and specifications, or
otherwise.  Franchisee shall indemnify the Franchisor for any loss,
cost or expense, including attorneys' fees, that may be sustained by the
Franchisor because of the acts or omissions of Franchisee's contractors or
arising out of the design, construction or remodeling of the Restaurant, except
to the extent that any such loss, cost or expense arises as a result of the
negligent acts or omissions of the Franchisor, its employees and/or
agents.

    


    5.8          Franchisee
shall give to the Franchisor at least thirty (30) days prior written notice of
the anticipated Opening Date.  Franchisee shall not open the
Restaurant to the public until it has received written approval from Franchisor
to open.  If Franchisee did not deliver to the Franchisor a final
Certificate of Occupancy prior to the Opening Date, Franchisee shall deliver to
the Franchisor a copy of an unconditional final Certificate of Occupancy issued
by the applicable local governmental entity no later than ninety (90) days
following the Opening Date.

    


    6.            FEES, TAXES AND OTHER
CHARGES

    


    6.1          Franchisee
agrees to pay to the Franchisor during the term of this Agreement the
following:

    


    a.           An
initial franchise fee of Forty Thousand Dollars ($40,000.00), in
full  within 30 days of delivery of execution copies of this Agreement
to Franchisee; provided, however, if the Restaurant is a Turnkey Restaurant the
initial franchise fee shall be payable upon execution of this
Agreement.  Notwithstanding the foregoing, if this Agreement is
executed for a second or subsequent Restaurant under a Development Agreement,
the initial franchise fee shall be as set forth in the Development
Agreement.  All such payments shall be made by cashier's check or
other form of payment acceptable to the Franchisor.  Franchisee hereby
acknowledges and agrees that the grant of this franchise and the agreements of
the Franchisor contained in this Agreement constitute the sole and only
consideration for the payment of the initial franchise fee and the initial
franchise fee shall be fully earned by the Franchisor upon execution of this
Agreement.  In that regard, upon the payment of any portion of the
initial franchise fee, the entire initial franchise fee shall be deemed fully
earned and non-refundable in consideration of the administrative and other
expenses incurred by the Franchisor in granting this franchise and for the
Franchisor's lost or deferred opportunity to franchise to others.

    


    b.           A
monthly royalty fee in the sum of four percent (4%) of Franchisee's monthly
Gross Sales (as defined in Section 7.1).


    
      
         


      

      
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    c.           A
fee, which shall be used in accordance with Section 8, for advertising, public
relations and promotion and for the creation and development of advertising,
public relations and promotional campaigns (“Advertising Fee”), in the amount
of: (i) five percent (5%) of Franchisee's monthly Gross Sales, as defined in
Section 7.1 if the Restaurant is located outside of the Los Angeles designated
market area ("DMA") or (ii) four percent (4%) of Franchisee's monthly Gross
Sales, as defined in Section 7.1 if the Restaurant is located within the Los
Angeles DMA.  Franchisor reserves the right to increase the
Advertising Fee in the future by gaining an approval vote of fifty-one percent
(51%) of all then existing Franchisor-owned and franchised restaurants operating
under the El Pollo Loco®
System.  Each such restaurant shall be entitled to one
vote.

    


    d.           The
amount of all sales taxes, use taxes and similar taxes imposed upon or required
to be collected or paid by the Franchisor on account of goods or services
furnished to Franchisee by the Franchisor, whether such goods or services are
furnished by sale, lease or otherwise.  Franchisee shall reimburse the
Franchisor for the invoice amount within seven (7) days after the invoice has
been delivered to Franchisee pursuant to Section 23.3 of this
Agreement.

    


    6.2           Franchisee
agrees to pay interest to the Franchisor on any amounts which may become due to
the Franchisor from Franchisee, if such are not paid when due, at the rate of
fifteen percent (15%) per annum or the maximum interest rate permitted by law,
whichever is less.

    


    7.       
     FINANCIAL REPORTING, BILLING AND
PAYMENT

    


    7.1           The
term "Gross Sales" as used in this Agreement shall mean the total revenues
derived by Franchisee in and from the Restaurant from all sales of food, goods,
wares, merchandise and all services made in, upon, or from the Restaurant,
whether for cash, check, credit or otherwise, without reserve or deduction for
inability or failure to collect the same, including, without limitation, all
revenues derived from delivery, catering, and special event sales, such sales
and services where the orders therefore originate at and are accepted by
Franchisee into the Restaurant but delivery or performance thereof is made from
or at any other place, or other similar orders are received or billed at or from
the Restaurant, and any sums or receipts derived from the sale of meals to
employees of the Restaurant.  Gross Sales shall not include rebates or
refunds to customers; or the amount of any sales taxes or other similar taxes
that Franchisee may be required to and does collect from customers to be paid to
any federal, state or local taxing authority.


    7.2           Franchisee
shall deliver to the Franchisor on or before the sixth (6th) calendar day after
each month a monthly Gross Sales statement ("Monthly T-Sheet"), in the form
specified by the Franchisor, setting forth the amount of Gross Sales for the
preceding month and a calculation of the monthly fees payable on such
sales.  Monthly fees, including royalty and advertising fees, shall be
due and payable on the tenth (10th) day
after the close of the sales month, which closing shall be designated by El
Pollo Loco®
in its sole discretion upon ten (10) days advance written notice to
Franchisee.    Franchisee shall make all payments due
hereunder by one of the following forms of payment (the “Forms of Payment”):
check, electronic funds transfer, pre-arranged draft or sweep of Franchisee’s
bank account.  Franchisee will give the Franchisor authorization in
the format set forth in Exhibit
5 attached hereto for direct debits from Franchisee’s business bank
operating account.  The Franchisor shall choose the Form of Payment in
its sole discretion from time to time and shall provide written notice of any
changes to Franchisee at least ten (10) business days prior to the effective
date of the change.

     

    
      
        
        

      

      
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    If
Franchisee is delinquent in any payment of such fees, or if Franchisee has not
submitted the Monthly T-Sheet for more than a two-month period when due, the
Franchisor may, in its sole discretion initiate an EFT transfer from
Franchisee’s business bank account an estimated amount of fees due the
Franchisor for such period which shall be based on the average of the
immediately preceding three (3) months’ Gross Sales.  If, at any time,
the Franchisor determines that Franchisee has under-reported the monthly Gross
Sales of the Restaurant, or underpaid the monthly royalty, advertising fees, DMA
Advertising Fee, or other amounts due to the Franchisor under this Agreement, or
any other agreement, the Franchisor may, in addition to exercising all other
rights and remedies available to it under this Agreement, initiate an immediate
transfer from the Account in the amount equal to the unpaid fees in accordance
with the foregoing procedure, including interest as provided in Section 6.2
above.  Any overpayment of fees will be credited to the Account
effective as of the first Due Date after the Franchisor and Franchisee determine
that such credit is due.

    


    In
connection with payment of the monthly royalty fee and advertising fee by EFT,
Franchisee shall: (1) comply with procedures specified by the Franchisor
relating to EFT transfers; (2) perform those acts and sign and deliver those
documents as may be necessary to accomplish payment by EFT as described in this
Section 7.2; (3) give the Franchisor an authorization in the form designated by
the Franchisor to initiate debit entries and/or credit correction entries to the
Account for payments of the monthly royalty and advertising fees, or other
amounts due to the Franchisor under this Agreement, or any other agreement,
including any interest charges; and (4) make sufficient funds available in the
Account for withdrawal by EFT of fees due no later than each Due
Date.

    


    7.3           In
addition to the sales data required to be provided in the Monthly T-Sheet to be
delivered pursuant to Section 7.2, Franchisee shall deliver (in the manner
prescribed by Franchisor) to the Franchisor on or before the tenth (10th) day
after the end of each sales month during the term of this Agreement any other
sales and menu mix data reasonably requested by the Franchisor with respect to
the preceding sales month, whether specified in the Manual or
otherwise.

    


    7.4           Thirty
(30) days after the end of each calendar quarter and one hundred twenty (120)
days after the end of each calendar year during the term of this Agreement,
Franchisee shall provide to the Franchisor an financial statement of the
franchise business which shall include such information and data as specified in
the financial reporting format set forth in Exhibit 7 attached hereto or
in such other format reasonably approved by Franchisor.   Such
fiscal year-end financial statements must be signed by Franchisee, Franchisee's
treasurer or Franchisee's chief financial officer and contain a representation
that the financial statements present fairly the financial position of
Franchisee and the results of operations of the franchise business during the
period covered.


    
      
         


      

      
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    7.5          Franchisee
agrees to make all payments when due to third parties for obligations arising
out of or in any way connected with the existence, operation or maintenance of
the Restaurant, including, but not limited to, rental and mortgage payments and
payments for utilities, services, products, equipment, supplies, goods,
inventory, materials, taxes, labor and other matters.  In the event
that Franchisee fails to make any such payment in accordance with the foregoing
and the nonpayment results or may reasonably result in a condition or event
which threatens public safety or health or which may materially and adversely
affect the ownership, condition or operation of the Restaurant, in either case
in the reasonable judgment of the Franchisor, the Franchisor shall have the
right, after five (5) days written notice to Franchisee, but not the obligation,
to make such payment on behalf of Franchisee.  Such payment shall be
without prejudice and in addition to all other available rights and
remedies.  Any payment made by the Franchisor pursuant to this Section
7.5 shall be paid by Franchisee to the Franchisor as an additional amount for
the monthly billing period in which such payment is made by the
Franchisor.

    


    7.6          Franchisee
shall maintain accurate and complete books and records pertaining to the
operation and maintenance of the Restaurant as required by the standards,
policies and procedures established by the Franchisor in accordance with the
Manual.  Franchisee shall be solely responsible for performing all
record keeping duties, and the cost for all such services shall be borne solely
by Franchisee.

    


    7.7          Franchisee
shall obtain, install, and use the computer system that Franchisor requires or
approves in writing.  The term “Computer System” means communications,
computer systems, and hardware to be used by the Restaurant, including (a) back
office and point of sale systems, (b) cash register systems; (c) physical,
electronic, and other security systems; (d) printers and other peripheral
devices; (e) archival back-up systems; and (f) internet access mode (for
example, your telecommunications connection).  In connection with the
Computer System:

    


    
      	
            	
              a.

            	
              Franchisee
      must obtain, install, and use the computer software programs required by
      Franchisor (the “Required Software”) from time to
      time.  Franchisee must utilize any proprietary software program
      that Franchisor may develop internally or with the assistance of outside
      suppliers or consultants or that Franchisor may license for use by the El
      Pollo Loco®
      System.

            


    


    
      
         


      

      
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              b.

            	
              Franchisor
      may modify specifications for and components of the Computer System and
      Required Software.  The Computer System and Required Software
      must be purchased or leased from Franchisor or from suppliers approved by
      Franchisor, and must be installed by Franchisor or by suppliers approved
      by Franchisor at Franchisee’s expense.  All Computer System
      components must be installed in accordance with Franchisor’s standards and
      procedures.  Franchisor’s modification of specifications for the
      Computer System and Required Software may require Franchisee, at
      Franchisee’s expense, to purchase, lease, and/or license new or modified
      computer hardware and/or software and/or communications
      capabilities.  Franchisee will not be required to replace the
      Computer System more than once every four (4) years during the term of
      this Agreement.  Franchisee shall be required to enter into an
      El Pollo Loco® IT
      Support Services Agreement (a “Support Agreement”) in connection with the
      operation of the Computer System.  The Support Agreement is
      attached to this Agreement as Exhibit
    8.

            


    

    


    
      	
            	
              c.

            	
              The
      Computer System is for use by Franchisee only in connection with
      operational and management tasks of the Restaurant.  Franchisee
      may not use the Computer System for email, word processing, spreadsheets,
      web surfing, or any other personal application or purpose not approved in
      writing by Franchisor (“personal applications”).  However,
      Franchisee may run such personal applications on a separate personal
      computer and network provided by Franchisee, but the personal computer and
      network must run in “stand alone, isolated mode” and Franchisee must not
      interconnect such computer(s) with the Computer
      System.  Franchisor reserves the right require Franchisee to
      shut down personal applications interfaces if Franchisor determines that
      such interfaces interfere with the Computer System operations, or the
      operation of the Restaurant.

            


    

    


    7.8          All
of the accounts, books, records and federal, state and local tax returns and
reports of Franchisee, so far as they pertain to the business transacted under
this Agreement, shall be open to inspection, examination and audit by the
Franchisor and its authorized representatives at any and all times, and copies
thereof may be made by the Franchisor and retained for its own
use.  All of such records shall be maintained and retained by
Franchisee for seven (7) years, and following the termination or expiration of
this Agreement, the books and records for the preceding seven (7) years shall be
maintained and retained by Franchisee for five (5) years. The Franchisor may
perform such auditing for the purpose of verifying the operating and financial
data upon which the rents, fees and other charges payable to the Franchisor
hereunder are based.  Any such inspection, examination and audit shall
be at the Franchisor's cost and expense unless the same is necessitated by
Franchisee's failure to prepare and deliver its transmittal reports to the
Franchisor as required herein, or to maintain books and records as hereinabove
provided, or unless any such transmittal report is determined to be in error to
an extent of two percent (2%) or more.  In any such event, the cost
and expense for such inspection, examination and audit shall be borne and paid
by Franchisee.  Any such cost and expense shall be set forth in a
written invoice delivered to Franchisee by the Franchisor.  Franchisee
shall reimburse the Franchisor for the invoice amount within seven (7) days
after the invoice has been delivered to Franchisee pursuant to Section 23.3 of
this Agreement.


    
      
         


      

      
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    7.9          Franchisee
shall sell or otherwise issue the stored value cards or gift cards and
certificates (together “Gift
Cards”) that have been prepared utilizing the standard form of Gift Card
provided or designated by Franchisor, and only in the manner specified by
Franchisor in the Manual or otherwise in writing.  Franchisee shall
fully honor all Gift Cards that are in the form provided or approved by
Franchisor regardless of whether a Gift Card was issued by Franchisee or another
Restaurant or purchased at any other location including without limitation,
retail stores, internet sales or other means of
distribution.  Franchisee shall sell, issue, and redeem (without any
offset against any royalty fees) Gift Cards in accordance with procedures and
policies specified by Franchisor in the Manual or otherwise in writing (the
“Gift Card Program”),
including those relating to procedures by which Franchisee shall request
reimbursement for Gift Cards issued by other Restaurants and for making timely
payment to Franchisor, other operators of Restaurants, or a third-party service
provider for Gift Cards issued from the Restaurant that are honored by
Franchisee, Franchisor or other Restaurant operators.  Franchisee
acknowledges and agrees that, in connection with the Gift Card Program,
Franchisee may be required to:

    


    
      	
            	
              a.

            	
              Enter
      into a separate agreement with a third party provider of Gift Card
      services under the terms and conditions as may reasonably be required by
      such third party for participation in the Gift Card
    Program;

            


    

    


    
      	
            	
              b.

            	
              Purchase
      and maintain a sufficient number of Gift Cards, in a form approved by the
      Franchisor, as may reasonably be required for participation in the Gift
      Card Program;

            


    

    


    
      	
            	
              c.

            	
              Purchase
      or upgrade, as applicable, such hardware, software and equipment as shall
      be necessary to participate in the Gift Card
  Program;

            


    

    


    
      	
            	
              d.

            	
              Promote
      and sell the Gift Cards in Franchisee’s Restaurants using only marketing
      methods and materials approved by
Franchisor;

            


    

    


    
      	
            	
              e.

            	
              Comply
      in all material respects with all applicable laws, statutes and
      regulations in performing Franchisee’s obligations under this Agreement
      and otherwise in connection with Franchisee’s participation in the Gift
      Card Program; and

            


    

    


    
      	
            	
              f.

            	
              Execute
      such forms or documents or take such other actions reasonably necessary or
      requested by Franchisor to effectuate Franchisee’s participation in the
      Gift Card Program.

            


    

    


    Franchisee acknowledges and agrees that
Franchisor reserves the right to discontinue or modify the Gift Card Program at
any time, in its sole discretion.  Upon receipt of written notice from
the Franchisor of its intent to discontinue or modify the Gift Card Program,
Franchisee agrees, as applicable, to immediately cease offering and accepting
Gift Cards or to make such modifications as Franchisor shall
require.

    


    8.   
         ADVERTISING AND
MARKETING


    8.1           Recognizing
the value of marketing and advertising to the goodwill and public image of the
El Pollo Loco® System,
Franchisor administers funds for advertising, public relations, marketing
research and promotion into which all franchisees contribute the “Advertising
Fee”.  El Pollo Loco®
restaurants owned and operated by Franchisor contribute on the same basis as
franchisees within the same DMA.

    


    8.2           The
entire  Advertising Fee will be deposited into the Advertising Fund to
be allocated in our sole discretion

    


    
      
        
        

      

      
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    8.3           Franchisor
shall have sole discretion over the expenditures and all aspects of activities
funded by the Advertising Fund, including media plans and buying, creative
concepts, materials, endorsements and agency relationships.  The
Advertising Fund may be used to pay for production costs for materials and
programs Franchisor chooses, including advertising agency fees, market research,
concept development, design development (store prototypes and advertising),
product research and development, video, audio, electronic, written advertising
materials, media and public relations programs.  The Advertising Fund
will be accounted for separately from Franchisor’s other
funds.  Although it has been Franchisor’s practice to spend all
advertising funds in the fiscal year in which they are collected, Franchisor
reserves the right to spend such advertising funds in the next fiscal year to
the extent Franchisor deems appropriate.  Franchisor may spend in any
fiscal year an amount greater or less than the aggregate contributions made by
El Pollo Loco®
restaurants to the Advertising Fund in that year, and the Advertising Fund may
borrow from Franchisor or from other lenders to cover deficits in the
Advertising Fund or cause the Advertising Fund to invest any surplus for future
use by the Advertising Fund.  Upon request, but not more frequently
than annually, Franchisor will provide Franchisee with a written description of
the expenditures made by the Advertising Fund during the fiscal year immediately
preceding the request of the advertising fees received from franchisees. The
statement of expenditures is not required to be audited.

    


    8.4           If
Franchisee is located outside the Los Angeles DMA, at our discretion, a portion
of your Advertising Fee may be allocated to a Local Advertising Fund (“LAF”) for the
Restaurant.  You will be required to pay the Advertising Fee to us at
the same time as your royalty payments pursuant to the Direct Debit Agreement
(Exhibit 5 to the
Franchise Agreement).  If the Restaurant has an LAF as designated by
our Marketing Department, you must use current approved vendors for your
advertising order, then EPL will pay the approved vendor directly upon approval
of the order and confirmation of receipt of the order with you.  The
LAF monies will also be used to reimburse Franchisee for the cost of
implementing local marketing plans developed by Franchisee and approved by
Franchisor (up to an amount not to exceed the LAF contributions
collected).  The LAF monies will be used to reimburse you for the cost
of implementing local marketing plans developed by you and approved by us in
writing.  For these purposes, qualifying LAF expenditures include, but
are not limited to: (a) amounts contributed to Advertising Associations (defined
below); and (b) amounts spent for advertising media, such as television, radio,
newspaper, billboards, posters, direct mail, collateral and promotional items,
advertising on vehicles (excluding the cost of any vehicle), and, if not
provided by Franchisor, the cost of producing approved materials necessary to
participate in such media.  Non-qualifying LAF expenditures include
amounts spent for items which Franchisor, in its reasonable judgment, deems
inappropriate for meeting the minimum advertising requirement, including
permanent off-premises signs and menuboard hardware, lighting, administrative
costs, Yellow Pages advertising, discounts/coupons offers, free
offers  and employee incentive programs.


    
      
         


      

      
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    8.5           Franchisee
shall not engage in any advertising activities without Franchisor’s prior
consent.  Franchisee shall submit to Franchisor for Franchisor’s prior
approval, at least thirty (30) days prior to the beginning of each fiscal year,
a marketing plan for Franchisee’s DMA.   This marketing plan may
be submitted by all franchisees in your DMA through an area advertising
association.  If Franchisee is using materials not prepared by
Franchisor and which vary from Franchisor’s standard advertising and promotional
materials, such materials must be submitted to Franchisor for approval no less
than forty-five (45) days prior to the beginning of such promotion or
program.  Franchisor will review any materials submitted for
Franchisor’s approval within ten (10) business days of receipt of such
materials.  Franchisee shall not use any advertising or promotional
materials that Franchisor has disapproved, or that Franchisor has not
approved.  If Franchisee chooses to request EPL to manage and spend
their LAF on their behalf, EPL will create a Marketing Plan for their LAF and
carry out that plan with your written permission.

    


    8.6           Franchisor
shall have the right to establish local and/or regional advertising associations
(“Advertising
Associations”) for El Pollo Loco®
restaurants in Franchisee’s local or regional area, covering the geographic
areas Franchisor may designate from time to time.  Franchisor has the
right to form, change, dissolve or merge the Advertising
Associations.  If Franchisor has established an Advertising
Association in Franchisee’s DMA, Franchisee must participate in the Advertising
Association and its programs and abide by its by-laws.  Each El Pollo
Loco®
restaurant located within the area governed by the Advertising Association will
have one (1) vote.  Franchisee must contribute the amounts to the
Advertising Association(s) as determined by the Advertising Association members
from time to time in accordance with their bylaws.  Any El Pollo
Loco®
Restaurant owned by Franchisor in Franchisee’s DMA or regional market area(s)
will contribute to the Advertising Association on the same
basis.  Contributions to the local and regional Advertising
Associations are credited toward the LAF advertising expenditures required
pursuant to Section 8.4 above; however, if Franchisor provides Franchisee and
Franchisee’s Advertising Association ninety (90) days’ notice of a special
promotion, including, but not limited to, any regional promotions, Franchisee
must participate in the promotion and also pay Franchisor any special promotion
advertising fees assessed in connection with the program, beginning on the
effective date of the notice and continuing until the special promotion is
concluded.  Any special promotion advertising fees will be in addition
to, and not credited towards, the LAF advertising expenditure required pursuant
to Section 8.4 above.  The Advertising Association Membership
Agreement is attached to this Agreement as Exhibit
6.  Franchisor may administer the Advertising Associations and
collect Franchisee’s Advertising Association contributions by automatic
electronic withdrawal.

    


    8.7           The
Franchisor shall be under no obligation to use the Advertising Fund to advertise
equally for all markets or for all franchise areas.   All
advertising fee contributions from company-operated restaurants shall be
deposited in the Advertising Fund.  The Franchisor shall be under no
obligation to determine the incremental cost of franchise sales advertising and
investor relations sections of any internet web sites established by the
Franchisor and funded in whole or in part by the Advertising Fund.

    


    
      
        
        

      

      
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    8.8           In
addition to Advertising Fees payable pursuant to Section 6.1 of this Agreement,
Franchisee shall expend $5,000.00 per Restaurant to conduct grand opening
advertising and local store marketing and promotion programs for Franchisee’s
Restaurant, utilizing advertising and promotional materials approved by
Franchisor, in the manner specified in Section 8.2 and 8.4.  Such
grand opening advertising shall be conducted in accordance with Franchisor’s
specifications and standards and in accordance with a grand opening plan (which
will cover advertising and promotion for the 15 days prior to the Opening Date
and 45 days following the Opening Date) which Franchisee prepares and submits to
Franchisor for approval at least 30 days prior to the anticipated Opening
Date.  Franchisee shall submit to Franchisor not later than 15 days
following the conclusion of such grand opening promotion, written receipts and
other evidence reasonably satisfactory to Franchisor evidencing all amounts
spent by Franchisee to conduct said grand opening promotion.

    


    9.            
INSURANCE AND
INDEMNIFICATION

    


    9.1           During
the term hereof, Franchisee shall obtain and maintain insurance coverage with
insurance carriers acceptable to the Franchisor in accordance with the
Franchisor's current insurance requirements.  The coverage shall
commence when the Location is secured by Franchisee by executed deed or lease
and shall comply with the requirements of Franchisee's lease, if any, for
products liability and broad form contractual liability coverage in the amount
of at least two million dollars ($2,000,000.00) combined single limit and not
less than $1,000,000.00 per occurrence.  Franchisee shall also carry
fire and extended coverage insurance with a maximum deductible of $10,000.00 and
with endorsements for vandalism and malicious mischief, covering the building,
structures, equipment, improvements and the contents thereof in and at the
Restaurant, on a full replacement cost basis, insuring against all risks of
direct physical loss except for unusual perils such as nuclear attack, earth
movement and war, and business interruption insurance in actual loss sustained
form covering the rental of the Location, previous profit margins, maintenance
of competent personnel and other fixed expenses.  Franchisee shall
also carry such worker's compensation insurance as may be required by applicable
law.  In connection with and prior to commencing any construction,
reimage or remodeling of the Restaurant, Franchisee shall maintain Builder's All
Risks Insurance and performance and completion bonds in forms and amounts, and
written by a carrier or carriers, acceptable to the Franchisor.  As
proof of such insurance, a certificate of insurance shall be submitted by
Franchisee for the Franchisor's approval prior to Franchisee's commencement of
any activities or services to be performed under this
Agreement.  Franchisee shall deliver a complete copy of Franchisee's
then-prevailing policies of insurance to the Franchisor within thirty (30) days
following the delivery of the certificate of insurance.


    
      
         


      

      
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    9.2           The
Franchisor shall be named as an additional insured on all of such policies
referenced in Section 9.1 above to the extent of its interests and shall be
provided with certificates of insurance evidencing such coverage prior to the
Opening Date and promptly following the date any policy of insurance is renewed,
modified or replaced during the term of this Agreement.  All coverages
shall be placed with an insurer with a rating of A or better from Moody’s or
S&P or a rating of A-VIII or better from Best’s.  All public
liability and property damage policies shall contain a provision that the
Franchisor, although named as an additional insured, shall nevertheless be
entitled to recover under such policies on any loss occasioned to it, its
affiliates, officers, agents and employees by reason of the negligence of the
Franchisor, the Franchisee, or their respective principals, contractors, agents
or employees.  All policies shall extend to and provide indemnity for
all obligations assumed by Franchisee hereunder and all other items for which
Franchisee is required to indemnify the Franchisor under the provisions of this
Agreement, whether or not the liability arose from the negligence of the
Franchisor, its principals, contractors, agents or employees, and shall provide
the Franchisor with at least thirty (30) days prior written notice of
cancellation, termination or material reduction of coverage.  The
Franchisor reserves the right to specify reasonable changes (which may include
increases) in the types and amounts of insurance coverage required by this
Section 9.  Should Franchisee fail or refuse to procure the required
insurance coverage from an insurance carrier acceptable to the Franchisor or to
maintain it throughout the term of this franchise, the Franchisor may in its
discretion, but without any obligation to do so, obtain such coverage for
Franchisee, in which event Franchisee agrees to pay the required premiums or to
reimburse the Franchisor therefore.  The amount of such premiums shall
be set forth in a written invoice delivered to Franchisee by the
Franchisor.  Franchisee shall reimburse the Franchisor for the invoice
amount within seven (7) days after the invoice has been delivered to Franchisee
pursuant to Section 23.3 of this Agreement.  Failure to maintain the
required insurance or to promptly reimburse the Franchisor for any premiums paid
on behalf of the Franchisee by the Franchisor shall constitute a default
hereunder.

    


    9.3           Franchisee
agrees to defend at its own cost and to indemnify and hold harmless the
Franchisor, its subsidiaries, parent and affiliates, shareholders, directors,
officers, employees and agents (each an "Indemnitee") from and against any and
all loss, costs, expenses (including attorneys' fees), damages and liabilities,
however caused, resulting directly or indirectly from or pertaining to the use,
condition, construction, equipment, decorating, maintenance or operation of the
Restaurant, and including the preparation and sale of any product made in or
sold from the Restaurant, and including any labor or other employee related
claims of any kind including, without limitation, any claims made by an employee
of Franchisee resulting from the employee's training in a Franchisor operated
facility or restaurant, and including Franchisee's failure for any reason to
fully inform any third party of Franchisee's lack of authority to bind the
Franchisor for any purpose.  Such loss, claims, costs, expenses,
damages and liabilities shall include, without limitation, those arising from
latent or other defects in the Restaurant, whether or not discoverable by the
Franchisor, and those arising from the death of or injury to any person or
arising from damage to the property of Franchisee or the Franchisor, their
agents or employees, or any third person or Entity, whether or not such losses,
claims, costs, expenses, damages or liabilities resulted from any strict
liability imposed on the Franchisor or any of its officers, agents or
employees.  Notwithstanding the foregoing, Franchisee shall not be
responsible to an Indemnitee for any loss, claim, cost, expense, damage or
liability which arises as a result of the negligence of such
Indemnity.


    
      
         


      

      
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    10.          VENDING MACHINES

    


    Franchisee
agrees that no cigarette machine, video game machine, juke box, public telephone
or other type of vending machine or device, whether or not coin operated, shall
be installed in the Restaurant, or on its premises, without the written approval
of the Franchisor.  The revenues received by Franchisee from any
approved machines shall be included in Franchisee's Gross Sales.

    


    11.          COMPLIANCE WITH MANUAL AND WITH
SYSTEM STANDARDS

    


    11.1      
 Franchisee acknowledges and agrees that strict and continued adherence by
Franchisee to the Franchisor's standards, policies, procedures and requirements,
as set forth in this Section 11, is expressly made a condition of this
Agreement, so that failure on the part of Franchisee to so perform will be
grounds for termination of this Agreement as provided in Section 18
hereof.  Franchisee acknowledges that changes, modifications,
deletions and additions to the standards, specifications, procedures and menu
items comprising the El Pollo Loco®
System may be necessary and desirable from time to time.  The
Franchisor may make such modifications, revisions, deletions and additions,
including without limitation modifications, revisions, deletions and additions
to the Manual and to the menu items required to be offered by Franchisee, which
the Franchisor, in good faith and exercising its judgment, believes to be
desirable and reasonably necessary.  Franchisee agrees to comply with
any such modification, revision, deletion or addition as of the date that such
modification, revision, deletion or addition becomes
effective.  Franchisee acknowledges that it shall receive one (1) copy
of the Manual per Restaurant and one per Franchisee on loan from the Franchisor
and that the Manual shall at all times remain the sole property of the
Franchisor.  Franchisee understands that the Franchisor has entered
into this Agreement in reliance upon Franchisee's representation that it will
strictly comply with all the provisions of the Manual.  For purposes
of this Agreement, the Manual shall be deemed to include all written directions
delivered to Franchisee by Franchisor from time to time setting forth standards,
specifications and procedures for the operation of Franchisee's El Pollo
Loco®
restaurant.

    


    11.2        Franchisee
agrees that it is in the best interest of the business conducted at the
Restaurant to prepare and serve food in the Restaurant only from ingredients
which meet the product specifications as communicated by Franchisor to
Franchisee from time to time (the "Specifications"), and Franchisee further
agrees that all products, equipment, goods, inventory and supplies used in
connection with the Restaurant will comply with the
Specifications.  Furthermore, Franchisee shall not offer or sell any
product, service or other item at the Restaurant except those approved in
writing by the Franchisor.

    


    a.           All
menu items shall be made in strict compliance with the Franchisor's written
recipes and requirements, which the Franchisor may change from time to time by
amendments to the Manual.

     

    
      
        
           


        

        
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    b.           All
proprietary El Pollo Loco®
marinades, marinade mixes and marinated ingredients used in the preparation of
the required and approved El Pollo Loco®
food products are unique.  Their formulae and the process of their
manufacture constitute trade secrets.  Franchisee agrees to purchase
such marinades, marinade mixes and marinated ingredients exclusively from the
Franchisor or, in the Franchisor's sole discretion, from the Franchisor's
designated distributor.  The right to purchase and use such marinades,
marinade mixes and marinated ingredients is licensed to Franchisee pursuant to
this Agreement, and such right is restricted to use in the franchise business at
the Restaurant and solely for the term of this Agreement.

    


    11.3       Throughout
the term of this Agreement, Franchisee shall be actively engaged in the
management and day-to-day operation of the Restaurant.  You may
appoint an Operations Director to supervise all franchise
activities.  If you do appoint an Operations Director, the Operations
Director must be approved by the Franchisor and must satisfactorily complete the
EPL management training program and have received the ServSafe®
certification; and you must complete either the EPL management training program
or the Executive Franchisee Training Program. The Operations Director shall be
actively engaged in the management and day to day operations of the restaurant
and devote full time and best efforts to the supervision of EPL Restaurant(s)
owned by you. If at any time, for any reason, the Operations Director ceases to
perform those duties on behalf of the Restaurant(s), you shall appoint a new
Operations Director within 30 days, and the newly appointed Operations Director
must satisfactorily complete the EPL management training program with-in 90 days
of appointment; or, you shall assume the duties of the Operations Director and
complete the EPL management training program within 90 days (if not previously
completed). You must also comply with any applicable transfer provisions of your
franchise agreement if the change in your General Manager results in a change in
the equity ownership of the restaurant.

    


    The Restaurant shall be managed by not
less than four (4) managers who have successfully completed the EPL management
training program and have received the ServSafe®
certification and who will assume responsibility for the day-to-day management
of the operations of the Restaurant, including the preparation of food products,
accounting and the supervision and training of personnel.  The
managers may be required to sign a confidentiality agreement.  Each of
these trained managers of the Restaurant shall devote at lease thirty-two hours
per week to management responsibilities and shall be at the Restaurant during
open and operating hours, including opening and closing.  Each and
every shift during operating hours must have a manager in charge that is
certified and trained in the EPL management training program and is
ServSafe®
certified.


    
      
         


      

      
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    11.4      
Franchisee acknowledges that it has received a copy of the Franchisor's list of
approved brands and distributors (the "Approved Brands and Distributors
List").  The Franchisor has consulted with the distributors set forth
on such list and each distributor has agreed to offer products, equipment,
goods, inventory, supplies or paper products which will comply with the
Specifications.  Such Approved Brands and Distributors List is
furnished to Franchisee for Franchisee's convenience only, and, except for the
Franchisor's proprietary products which must be purchased from the Franchisor or
its designated distributors pursuant to Section 11.2(b), Franchisee shall be
entitled to purchase products, equipment, goods, inventory, supplies and paper
products which comply with the Specifications from any other distributor
offering such items; provided, however, that if Franchisee desires to purchase
any products from any distributor not named on the Approved Brands and
Distributors List, Franchisee shall first submit to the Franchisor a written
request for approval of any such distributor prior to Franchisee's use of any
such distributor.  The Franchisor shall have the right to require that
its representatives be permitted to inspect the distributor's facilities and
that samples from the distributor be delivered either to the Franchisor or to an
independent laboratory designated by the Franchisor for testing.  Upon
completion of Franchisor’s inspection and/or evaluation of the proposed
distributor (or samples provided by such distributor), and upon submission of
any additional information or data required by Franchisor, Franchisor shall
promptly approve or reject such proposed distributor. The Franchisor reserves
the right, at its option, to re-inspect the facilities and products of any such
approved distributor or of any distributor on the Franchisor's Approved Brands
and Distributors List and to revoke its approval upon the distributor's failure
to continue to meet any of the Franchisor's then-current Specifications and
criteria.  Nothing in the foregoing shall require the Franchisor to
approve any distributor.  The Franchisor agrees to evaluate any item
which Franchisee is considering procuring to determine whether such item
complies with the Specifications.  No charge shall be made by the
Franchisor for the services of the Franchisor's employees in connection with
such evaluation; however, Franchisee shall reimburse the Franchisor for its
reasonable cost and expenses in connection with such evaluation, including any
amounts paid to independent laboratories or consultants chosen by the Franchisor
in its sole discretion to assist in such evaluation.  All such amounts
shall be set forth in a written invoice delivered to Franchisee by the
Franchisor.  Franchisee shall reimburse the Franchisor for the invoice
amount within seven (7) days after the invoice has been delivered to Franchisee
pursuant to Section 23.3 of this Agreement.  The Approved Brands and
Distributors List and any guide containing such list are proprietary information
of El Pollo Loco®
and must be kept strictly confidential by Franchisee.  Franchisee
shall not copy, distribute, release or otherwise provide any third party with
all or any part of the information contained in the Approved Brands and
Distributors List or guide without first obtaining the prior written approval of
the Franchisor, which approval may be withheld in the Franchisor’s sole
discretion.

    


    11.5         As
uniformity of appearance and public recognition are important to the financial
success of Franchisee and the Franchisor hereunder, Franchisee agrees that in
connection with the operation of the Restaurant, Franchisee shall:

     

    a.           Use
only uniforms, menu boards, signs, cards, posters, notices, displays,
decorations, table tents and other such advertising materials which are
identical in appearance and quality to those furnished or approved by the
Franchisor.  The Franchisor may make available its menu-stock
(pre-printed as to all matters other than menu prices), including specials and
featured items, to Franchisee for printing in the event that Franchisee elects
to charge prices not provided for in the Franchisor's menu
codes.  Franchisee agrees that all specials or featured items
designated by the Franchisor shall be included as part of the menu and shall be
made available on the days and times designated by the Franchisor;
and

     

    
      
        
        

      

      
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    b.           Not
authorize or permit in the Restaurant, or on behalf of the Restaurant, any
advertising, signs, cards, posters, notices, displays, decorations or table
tents other than those described in Section 11.5.a, nor authorize or permit in
or around the Restaurant any products or services which are not authorized by
Franchisor, without the prior written consent of the Franchisor.

    


    c.           Not,
without Franchisor’s prior written consent, offer or conduct any delivery or
off-premises catering services at or from the Restaurant.  Franchisee
shall immediately cease offering and conducting delivery and catering services
if at any time Franchisor discontinues or revokes its approval of Franchisee’s
right to offer or conduct such service(s).  Notwithstanding the
foregoing, Franchisor may from time to time develop delivery or catering
programs under the System, and Franchisee shall be required to offer and conduct
such delivery and catering services from the Restaurant in accordance with such
program(s).

    


    The
Franchisor shall have the right to remove any unauthorized material at
Franchisee’s expense.

    


    12.           RESTAURANT MAINTENANCE AND
REPAIR

    


    12.1      
 Maintenance and repair of the Restaurant are the sole responsibility and
shall be done at the expense of Franchisee.  For the term of this
Agreement, Franchisee, at its sole cost and expense, shall maintain the
Restaurant and the Location, including, but not limited to, the Restaurant
building, the Location and parking lot, equipment, decor, furnishings, fixtures,
wares, utensils, supplies, and inventory, in good working order and condition
and in compliance with all laws. Franchisee shall make all repairs within thirty
(30) days of the date such repairs are identified as needed to bring the
Restaurant into a first-class condition.   Franchisee shall
replace any of the Restaurant's equipment, furnishings and fixtures and repaint
the Restaurant as necessary to satisfy this Section 12.  Without
limiting the generality of the foregoing, upon notice from Franchisor of any
change required or recommended by applicable law, rule or regulation, or if
Franchisor discovers any circumstance which is or may result in a danger to
public health, Franchisee shall promptly, remove, repair, replace or modify any
equipment or fixtures used in the Restaurant necessary to satisfy or rectify the
same.  All replacement equipment, furnishings and fixtures shall
comply with the Franchisor's then-current requirements and
specifications.

    


    12.2         Franchisee
agrees that it shall not make any addition to or change in the physical
appearance, decor, characteristics or style of the Restaurant without the prior
written consent of the Franchisor which consent may be withheld or granted
within the Franchisor’s sole discretion.

    


    12.3       
During the term of this Agreement, the Franchisor may require Franchisee, at
Franchisee's expense, to remodel the Restaurant, as the condition of the
building may require, to then current El Pollo Loco®
standards, format, design and image, as designated pursuant to plans and
specifications provided by the Franchisor; provided, however, Franchisee
shall not be required to undertake such remodeling more than once every seven
(7) years during the term of this Agreement, except if such remodeling is
required in connection with a transfer of the Restaurant under Section 17.4(c)
of this Agreement or granting of a successor franchise under Section 20
below.

    


    
      
        
        

      

      
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    12.4       
All signs to be used in connection with the Restaurant, both exterior and
interior, must conform to the Franchisor's sign criteria as to type, color,
design and location and be approved in writing by the Franchisor prior to
installation or display.  Franchisee shall change its signs to conform
with updated or revised requirements of the Franchisor when such revisions have
been implemented at seventy percent (70%) of the Franchisor's then-operated El
Pollo Loco®
restaurants and at such times as Franchisee is required to perform remodeling
work pursuant to Section 12.3.

    


    12.5         Franchisee
shall at all times operate its Restaurant as a clean, safe, sanitary, orderly,
legal and respectable place of business in accordance with the Manual, the lease
or sublease, if any, for the Location and all applicable federal, state or local
laws, rules, or regulations. Franchisee shall not cause or allow any part of its
Location to be used for any immoral or illegal purpose.

    


    13.           HOURS OF
OPERATION

    


    13.1         Franchisee
agrees to keep the Restaurant fully operational and open to the public upon such
days and during such minimum number of hours as the Franchisor shall prescribe
from time to time throughout the term of this Agreement in accordance with the
Manual.  In the event that the Restaurant is closed for reasons beyond
Franchisee's control, Franchisee will immediately notify the Franchisor by the
fastest means available.  Franchisee shall supply to the Franchisor
prior to the commencement of the construction or remodeling work of the
Restaurant proof that the Restaurant is allowed to be open to the public during
such required hours and days by the applicable local governmental authorities
and the landlord under the lease for the Location, if any.

    


    14.           PERSONNEL
STANDARDS

    


    14.1         Franchisee
agrees to hire, train and supervise Restaurant employees in accordance with the
applicable provisions of the Manual.  Franchisee shall do everything
necessary to ensure that all employees are, at all times during employment in
the Restaurant, neat, clean and adequately trained and supervised in connection
with the performance of their duties.  Franchisee shall also ensure
that employees, in the performance of their duties, wear neat, clean and uniform
attire as required by the Franchisor in accordance with the Manual.

    


    14.2         Franchisee
acknowledges that adequate training and supervision are necessary in order to
ensure that the Restaurant personnel provide service to the public in a
courteous, efficient and skilled manner and in accordance with the standards set
forth in the Manual.  Franchisee understands and agrees that
Franchisee is solely responsible for the performance of its Operations Manager
and all other of its employees and that the acts and omissions of such employees
which are inconsistent with the provisions of this Agreement shall be considered
grounds for termination of this Agreement as provided in Section 18
hereof.

     

    
      
        
        

      

      
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    14.3         Franchisee
agrees to maintain wages, hours, working conditions and other benefits for all
of its employees in accordance with all federal, state and local laws and
regulations.

    


    14.4         Franchisee
agrees to maintain all employee time, payroll and tax records and to file
required reports thereon in accordance with all federal, state and local laws
and regulations.

    


    14.5         It
is mutually understood and agreed by the parties that Franchisee retains the
responsibility and independent authority, notwithstanding any provision of this
Agreement, to maintain and enforce personnel policies and procedures, including,
but not limited to, hiring, firing and disciplining its
employees.  Nothing contained in this Agreement shall be construed or
interpreted so that any employee of Franchisee becomes or is deemed to be an
employee or agent of the Franchisor.  Franchisee shall be solely
responsible for the maintenance and handling of all employee matters in the
manner required by this Section 14, and Franchisee agrees to indemnify and hold
the Franchisor and its affiliates and subsidiaries harmless from any claims,
losses, or liabilities resulting from any failure by Franchisee to act in such a
manner.

    


    15.           INSPECTIONS

    


    15.1         In
order to maintain the high standards of quality necessary for the mutual success
of the Franchisor and Franchisee hereunder, the Franchisor and its authorized
representatives shall have the right to inspect the Restaurant and the supplies
and inventory of Franchisee. The Franchisor's personnel and representatives
shall have the right to enter the Restaurant at any reasonable time, and from
time to time, with or without notice, for the purposes of examination,
conferences with Franchisee and personnel of Franchisee, observation and
evaluation of the operations being conducted at the Restaurant, and for all
other purposes in connection with a determination that the Restaurant is being
operated in accordance with the terms of this Agreement, the Specifications and
Manual and other applicable laws and regulations.


    15.2         Franchisor
may conduct a quality control and evaluation program (including a “mystery
shopper” program or “accuracy guarantee” program or other
similar  programs) to measure and evaluate customer satisfaction and
feedback from the products and services offered at the
Restaurant.  Franchisee agrees to participate in such program(s), as
required by Franchisor.  Franchisor shall have the right to require
Franchisee to pay its pro-rata share of the costs incurred in establishing and
maintaining  such program(s) and Franchisee agrees that it shall
promptly pay such charges.  Franchisee acknowledges that Franchisor
shall have the right, in any manner Franchisor may deem appropriate, to publish
or disclose to other franchisees under the El Pollo Loco® System,
or to third parties outside the El Pollo Loco® System
on an anonymous basis, any information that is collected, produced or maintained
under any program(s) implemented pursuant to this Section 15.2.

     

    
      
        
        

      

      
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    15.3        In
connection with inspections conducted pursuant to Sections 15.1 and 15.2 above,
the Franchisor and its authorized representatives may deliver to Franchisee an
inspection report in such form(s) as may be adopted by the Franchisor from time
to time (the "Inspection Report(s)").  The Inspection Report(s) shall
indicate the principal items inspected, observed and evaluated.

    


    15.4        In
the event that any such Inspection Report indicates a deficiency or
unsatisfactory condition with respect to any item listed thereon, Franchisee
shall promptly commence to correct or repair such deficiency or unsatisfactory
condition and thereafter diligently pursue the same to completion.  In
the event of a failure by Franchisee to comply with the foregoing obligation to
correct or repair, the Franchisor, in addition to all other available rights and
remedies, including the right to terminate this Agreement pursuant to Section 18
below, shall have the right, but not the obligation, to forthwith make or cause
to be made such correction or repair, and the expenses thereof, including,
without limitation, meals, lodging, wages and transportation for the
Franchisor's personnel, if so utilized in the Franchisor's sole discretion,
shall be reimbursed by Franchisee.  Should any deficiency or
unsatisfactory condition be reported more than once within any thirty (30) day
period, the Franchisor shall have the right, in addition to all other available
rights and remedies, to place a Franchisor representative in charge of the
Restaurant for a period of up to thirty (30) days in each such instance, and the
wages and expenses of meals, lodging and transportation of said representative,
which shall be commensurate with that provided for managers of other
Franchisor-owned El Pollo Loco®
restaurants, shall promptly be reimbursed by Franchisee.  All such
expenses incurred by the Franchisor pursuant to this Section shall be set forth
in a written invoice delivered to Franchisee by the
Franchisor.  Franchisee shall reimburse the Franchisor for the invoice
amount within seven (7) days after the invoice has been delivered to Franchisee
pursuant to Section 23.3 of this Agreement.

    


    16.          TRAINING

    


    16.1        The
Franchisor and Franchisee agree that it is important to the operation of the
Restaurant that Franchisee and its employees receive such training as the
Franchisor may require from time to time.  In that regard, Franchisee
agrees as follows:


    a.           Each
EPL Restaurant owned by you shall be managed by not less than four (4) managers
who have successfully completed the EPL management training program and have
received the ServSafe®
certification and who will assume responsibility for the day to day management
of the operations of the restaurant, including the preparation of food products,
accounting and the supervision and training or personnel.  The
managers may be required to sign a confidentiality agreement.  Each of
these trained managers of the restaurant shall devote at least thirty-two (32)
hours per week to management responsibilities and shall be at the restaurant
during open and operating hours for that amount of time. Each and every shift
must have a manager in charge that is certified and trained in the Franchisor’s
initial training program and is ServSafe®
certified.

     

    
      
        
        

      

      
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    If at any time, for any reason, the
General Manager ceases to perform those duties on behalf of the Restaurant(s),
you must promptly designate a substitute General Manager who does meet the
above-stated qualifications.  You must also comply with any applicable
transfer provisions of your Franchise Agreement if the change in your General
Manager results in a change in the equity ownership of the
Restaurant.

    


    b.           If
this is Franchisee’s first EPL Restaurant, the franchisee must also attend and
satisfactorily complete the EPL management training program provided by the
Franchisor.  If the franchisee appoints an Operations Director to
oversee franchise activities, this Operations Director must be approved by the
Franchisor and must satisfactorily complete the EPL management training program
and the franchisee must complete either the EPL management training program or
the Executive Franchisee Training Program. Such training shall be completed
prior to the opening of the restaurant.

    


    Upon opening your fourth EPL
Restaurant, your Operations Director shall be actively engaged in the management
and day to day operations of the restaurant and devote full time and best
efforts to the supervision of EPL Restaurant(s) owned by you. If at any time,
for any reason, the Operations Director ceases to perform those duties on behalf
of the Restaurant(s), you shall appoint a new Operations Director within 30
days, and the newly appointed Operations Director must satisfactorily complete
the EPL management training program with-in 90 days of appointment; or, you
shall assume the duties of the Operations Director and complete the EPL
management training program within 120 days (if not previously completed). You
must also comply with any applicable transfer provisions of your franchise
agreement if the change in your General Manager results in a change in the
equity ownership of the restaurant; and

    


    c.           Franchisee
shall implement a training program for Franchisee's employees in accordance with
training standards and procedures prescribed by the Franchisor and shall staff
the Restaurant at all times during the term of this Agreement with a sufficient
number of trained employees.

    


    d.           The
Franchisor may provide continuing operations training from time to time to
reinforce operational standards, and new product roll-outs.  The
required frequency, duration, subject matter and required attendees shall be as
determined by the Franchisor from time to time.

    


    e.           In
addition to the initial management training session described above, the
Franchisor may, at the Franchisor's sole option, (and if the Restaurant is
Franchisee's or its affiliate's first El Pollo Loco®
restaurant, the Franchisor shall) assist Franchisee in the initial opening of
the Restaurant by sending to the Restaurant a member of the Franchisor's
personnel who shall assist in the scheduled opening of the
Restaurant.

     

    
      
        
        

      

      
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    f.           The
Restaurant shall not be opened until the Franchisor is satisfied that Franchisee
and Franchisee's managers and other restaurant personnel have been adequately
trained in the El Pollo Loco®
System.

    


    16.2        If
this is Franchisee’s first or second EPL Restaurant, Franchisor shall provide
training in section 16.1 without additional charge to the franchisee, provided
that the franchisee does not request Franchisor to provide the EPL management
training program to more than four managers for each EPL Restaurant, or more
than two Executive Franchisee Training Programs in total, or more than two EPL
management training program for franchisee or Operations Director in total.
Franchisor shall charge franchisee a training fee contained in Item 6 of the Disclosure
Document, for each manager trained beyond the first four managers beyond the
first two EPL Restaurants, or the Executive Franchisee Training Program beyond
two executives in total, or EPL management training program for franchisee or
Operations Director beyond two franchisees or Operations Directors in
total.  Franchisee understands and agrees that Franchisee and any
trainee shall be solely responsible for any and all costs incurred by them with
respect to such training, including costs for compensation, wages (including
compensation of and worker’s compensation insurance), lodging, travel expenses
or any other expenses incurred in connection with any initial training sessions,
EPL management training program, Executive Franchisee Training Program,
refresher courses or optional or required training program, and any such trainee
shall not be considered an employee or agent of the Franchisor.

    


    17.          ASSIGNMENT

    


    17.1        Assignment by the
Franchisor.  The Franchisor shall have the right to assign or
transfer any of its rights or delegate any of its obligations under this
Agreement in whole or in part to any person, firm or corporation; provided,
however, that with respect to any assignment resulting in the subsequent
performance by the assignee of the obligations of the Franchisor
hereunder:

    


    a.           The
assignee shall expressly assume and agree to perform such obligations of the
Franchisor in writing; and

    


    b.           From
and after the date of any such assignment, the Franchisor shall have no further
obligation or liability under this Agreement.


    17.2        Assignment by
Franchisee.   The rights and duties created by this
Agreement are personal to Franchisee.  Franchisee acknowledges that
the Franchisor has entered into this Agreement in reliance on the individual or
collective character, skill, aptitude, business ability, and financial capacity
of Franchisee and its owners.  Franchisee and each owner of an
interest in this Agreement represent, warrant, and agree that all “Interests” in
the Franchisee are owned in the amount and manner in which Franchisee has
disclosed them to the Franchisor, as more particularly set forth in Schedule 1
to this Agreement.  (An “Interest” means any shares or partnership
interests in the Franchisee and any other legal or equitable right in any of
Franchisee’s stock, revenues, profits, rights or assets.  When
referring to the Franchisee’s rights or assets, an “Interest” also includes this
Agreement and the Franchisee’s rights under and interest in this Agreement, the
Restaurant and the revenues, profits or assets of the
Restaurant.)  Franchisee and each owner also represent, warrant and
agree and no change will be made in the ownership of an Interest other than as
permitted by this Agreement or as we may otherwise approve in
writing.  Franchisee and each owner agree to furnish the Franchisor
with evidence as the Franchisor may request from time to time to assure that the
Interests of the Franchisee and each owner remain as permitted by this
Agreement, including a list of all persons or entities owning any
Interest.

     

    
      
        
        

      

      
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    Neither
this Agreement nor any Interest herein nor any Interest of the Franchisee or any
owner may be indirectly or directly, sold, transferred, assigned, conveyed,
gifted, pledged, mortgaged, or otherwise encumbered without the Franchisor’s
prior written approval (“Assignment”).  Any such purported Assignment
occurring by operation of law or otherwise without the Franchisor’s prior
written consent shall constitute a default of this Agreement by Franchisee, and
shall be null and void.  Except in the instance of Franchisee
advertising to sell its Restaurant and assign this Agreement in accordance with
the terms thereof, Franchisee shall not, without the Franchisor’s prior written
consent, offer for sale or transfer at public or private auction or advertise
publicly for sale or transfer, the furnishings, interior and exterior décor,
items, supplies, fixtures, equipment, Franchisee’s lease or the real or personal
property used in connection with the Restaurant.  This Agreement may
not be transferred by Franchisee to a publicly-held entity, or to any entity
whose direct or indirect parent’s securities are publicly traded and no shares
of Franchisee or any direct or indirect owner of Franchisee may be offered for
sale through the public offering of securities.

    


    17.3         In
the event that Franchisee desires to assign all or any part of its rights,
privileges and interests under this Agreement, Franchisee shall first offer such
Assignment to the Franchisor by notifying the Franchisor in writing of the
material terms and conditions, including price and identity of transferee) upon
which Franchisee would be willing to make such an
Assignment.  Franchisee shall also concurrently provide the Franchisor
with the estoppel certificate identified in Section 17.5 below and such other
information as needed by the Franchisor to enable the Franchisor to evaluate the
offer.  The Franchisor shall have the first right to acquire said
rights, privileges and interests of Franchisee by accepting the offer in
accordance with said terms and conditions or equivalent cash, as determined by
Franchisor in its reasonable business judgment.  If, within thirty
(30) days after receipt of Franchisee's notice, the Franchisor advises
Franchisee of its acceptance of the offer as stated in the notice, Franchisee
agrees to promptly make the Assignment to the Franchisor on the stated terms and
conditions.  Should the Franchisor elect to exercise its right of
first refusal, Franchisee shall, if requested by the Franchisor, cause
Franchisee's lease or sublease, if any, with the lessor for the Location to be
assigned to the Franchisor.  Notwithstanding the foregoing, the
Franchisor shall have at least sixty (60) days from the date of its notice of
exercise to Franchisee to close the transaction and the Franchisor shall also be
entitled to all customary and reasonable representations and warranties from
Franchisee regarding the Restaurant.

    


    
      
        
        

      

      
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    17.4         If,
within thirty (30) days after receipt of Franchisee's notice, the Franchisor
does not indicate its acceptance of the offer as stated in the notice,
Franchisee shall thereafter have the right, subject to the prior written consent
of the Franchisor, to make the Assignment to the proposed transferee on the same
terms and conditions as stated in the notice.  Should the Franchisor
not exercise its right of first refusal and should the contemplated Assignment
not be completed within one hundred (120) days from the date of Franchisee's
notice, or should the terms and conditions thereof (including the proposed
transferee or the ownership therein) be altered in any material way, this right
of first refusal shall be reinstated and any such subsequent proposed Assignment
or altered terms and conditions of the current transaction must again be offered
to the Franchisor in accordance with the terms of these Sections 17.3 and
17.4.  Franchisee shall notify the Franchisor in writing of any
proposed assignee and shall promptly furnish the Franchisor with such other
information and documentation as the Franchisor may request for the purpose of
considering whether to grant its written consent.  Franchisee
acknowledges and agrees that the Franchisor shall be entitled, at its election
and without liability to Franchisee, to provide assignee with information
relating to the Restaurant, including information in the Franchisor's possession
relating to operations and sales.  The Franchisor shall not
unreasonably withhold its consent to an Assignment provided that the Franchisee
and the assignee satisfy such reasonable terms and conditions which may be
imposed by the Franchisor as a condition to obtaining the Franchisor's consent,
which may include, without limitation, the following:

    


    a.           The
assignee (and its partners or the officers, directors, principal shareholders,
or members of the assignee, as the case may be) shall be determined by the
Franchisor:

    


    i.           To
have the appropriate business qualifications, restaurant operations experience,
reputation, character, and aptitude necessary to operate and maintain the
Restaurant;

    


    ii.           To
have the ability to devote full time and best efforts to operating and
maintaining the Restaurant;

    


    iii.         To
be financially responsible, possess a favorable credit rating, be economically
capable of carrying on the Restaurant business and have sufficient net worth as
required by the Franchisor for new franchisees;

    


    iv.        
To not have been convicted of a felony or other criminal misconduct that is
relevant to the operation of the Restaurant;

    


    v.          Shall
neither directly nor indirectly own, operate, control or have any financial
interest in any other business which would constitute a "Competitive Business"
(as such term is defined in Section 21.7 of this agreement); and

     

    vi.         Shall
have demonstrated to the Franchisor’s satisfaction that assignee meets all of
the Franchisor’s then-current requirements for new El Pollo Loco®
franchisees, which requirements are subject to change by the Franchisor from
time to time in its sole discretion.

     

    
      
        
        

      

      
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    b.           The
assignee shall expressly assume in writing via the Consent to Assignment of
Franchise Rights attached hereto as Exhibit 10 of the Franchise
Agreement, for the all of the obligations and liabilities of Franchisee under
this Agreement and enter into the Franchisor's then-current form of Franchise
Agreement; provided, however, that the
term of such new agreement shall be equal to the remaining term of this
Agreement and assignee shall not be required to pay a new initial franchise
fee.  If this is an initial assignment, then Assignee including any
partners, shareholders, members of Assignee must sign the Franchise Agreement,
Personal Guaranty, etc. individually.  After the Initial assignment or
if a new Franchisee entered into the Franchise Agreement, Personal Guaranty,
etc., individually, and wish to assign to an Entity, Franchisor may require that
one or more of the partners, shareholders or members of assignee, as applicable,
and Franchisee in the case of a transfer by Franchisee to an Entity to be owned
in whole or in part by Franchisee, execute a personal guaranty, in form and
substance satisfactory to the Franchisor, guaranteeing each of assignee's
obligations and liabilities.  The number and identity of those
partners, shareholders and members of assignee which will be required to execute
guarantees shall be those persons and entities which, in the reasonable judgment
of the Franchisor, have a sufficient net worth to ensure assignee's performance
under this Agreement.  If the assignee is a corporation, partnership
or limited liability company, it also shall demonstrate to the reasonable
satisfaction of the Franchisor that it has established transfer instructions
prohibiting the transfer on its records of any equity securities, partnership
interests or ownership interests in violation of the requirements set forth in
this Section 17 and that each stock, partnership or ownership certificate of
Franchisee shall have conspicuously endorsed upon its face a statement in form
satisfactory to the Franchisor that the assignment or transfer is subject to all
of the restrictions imposed upon assignments by this Agreement;

    


    c.           The
assignee or the assignor agrees to the reimage and/or remodel of the Restaurant
to the Franchisor's then-current standards, format, design and image, as
designated pursuant to plans and specifications provided by the
Franchisor.  The assignee must deposit into an escrow account the sums
the Franchisor deems necessary to complete the required reimage and/or remodel
of the Restaurant.  Franchisee will have a specified period of time to
complete required reimage and/or remodel of the Restaurant, and the sum
deposited into escrow will not be released to Franchisee until the Franchisor
determines that the required reimage and/or remodel of the Restaurant has been
completed to its satisfaction;

    


    d.           After
the initial assignment, should the assignee wish to assign the franchise rights
to an entity, each partner, shareholder, member, or other person who (a) owns a
portion of the entity and (b) upon whose net worth we are relying in determining
assignee has met our financial minimum requirements for approval, must
personally guarantee the obligations of the franchise entity under the Franchise
Agreement.  A copy of the Personal Guarantee is attached hereto as
Exhibit
3.  All other individuals with an ownership interest in the
entity will be considered “Investors” and will be required to execute the
“Investor Covenants Regarding Confidentiality and Non-Competition” which is
attached hereto as Exhibit
4;

     

    
      
        
        

      

      
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    e.           The
assignee shall represent and warrant to the Franchisor in writing that the
assignee:

    


    i.           Has
conducted an independent study of the Restaurant and the business
therein;

    


    ii.           Has
not in any way relied upon statements or representations of the Franchisor or
its employees or agents except as may be contained in an Disclosure Document or
other comparable Disclosure Document which may be required to be delivered to
such assignee in accordance with applicable law; and

    


    iii.     
   Acknowledges and understands that the assignee's rights upon
assignment are conditioned on full performance of Franchisee's obligations
hereunder and are limited to those expressly provided for in this
Agreement.

    


    f.           As
of the date of such assignment, Franchisee shall have fully performed and
complied with all of its obligations to the Franchisor, whether under this
Agreement or any other agreement, arrangement or understanding with the
Franchisor;

    


    g.           Franchisee
shall pay and discharge all outstanding obligations to third parties arising
from the existence, operation or maintenance of the Restaurant including,
without limitation, amounts owing under the lease, if any, for the Location or
to employees, suppliers, taxing authorities, utility companies and others as of
the assignment date;

    


    h.           Franchisee
shall pay to the Franchisor a transfer fee to reimburse the Franchisor for costs
and expenses incurred in connection with such Assignment including, without
limitation, the cost of credit investigations and the preparation of Assignment
agreements and Disclosure Documents which may be required to be delivered to
such assignee under applicable federal or state law.  If the
Assignment is to a new franchisee under the El Pollo Loco® System,
the transfer fee shall be forty percent (40%) of the then-current Initial Fee
being charged to new franchisees entering the El Pollo Loco®
System.  If the Assignment is to an existing franchisee under the El
Pollo Loco® system,
the transfer fee shall be twenty-five percent (25%) of the then-current Initial
Fee being charged to new franchisees entering the El Pollo Loco® System;
and

    


    
      i.           
Upon
consent of the Franchisor to any assignment, Franchisee shall execute a general
release, in form and substance satisfactory to the Franchisor, of all claims
against the Franchisor.

    

     

    
      
        
        

      

      
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    17.5         Upon
the Franchisor’s request, Franchisee shall, concurrently with any offer
submitted to the Franchisor by Franchisee regarding a transfer or purported
Assignment or at any other time at the Franchisor’s request, furnish the
Franchisor with an estoppel agreement indicating any and all claims, demands and
causes of action, if any that Franchisee may have against Franchisor or if none
so exist, so stating, and a list of all owners having an interest in this
Agreement or in Franchisee, the percentage interest of each owner and a list of
all officers, directors, members and/or shareholders in such form as the
Franchisor may require.

    


    17.6         Any
encumbrance, assignment or purported encumbrance or assignment of Franchisee's
rights, privileges or interests under this Agreement without the Franchisor's
written consent shall be null and void, of no force and effect, and shall
constitute grounds for termination of this Agreement as provided in Section 18
hereof.

    


    17.7         If
Franchisee is an Entity or if this Agreement is assigned to an individual or
Entity, an Assignment of this Agreement will be deemed to have occurred when in
the aggregate more than fifty percent (50%) of any one class of outstanding
capital stock, the voting power, membership interests, partnership interests or
other ownership interests of such Entity has been sold, transferred, pledged or
assigned.  In determining whether there has been a transfer of fifty
percent (50%) of the stock, voting power, partnership interests or other
ownership interests in Franchisee as provided for in this Section 17.7, the
Franchisor may aggregate with any transfer, sale or assignment of stock, voting
power, partnership interest or other ownership interest any other transfer
occurring within thirty-six (36) months prior to the date of such
determination.  If the assignee is a revocable family trust for which
you are a controlling trustee and your immediate family members are
beneficiaries, no transfer fee will be payable to us, although you must
reimburse us for our reasonable expenses in the amount of $500.00.  We
will also waive our right of first refusal if your assignee is a family trust
that meets these criteria.

    


    17.8         If
an assignment is deemed to have occurred under any of the provisions of Section
17.7, then prior to the assignment and transfer being consummated, the
Franchisor shall have the option to purchase not only the interests being
transferred, but also the remaining interests, so that the ownership of the
Franchisor will be one hundred percent (100%).  Any purchase of such
remaining interests shall be valued on a basis proportionate to the price of the
interests initially being offered.  If Franchisee is an Entity,
Franchisee shall cause each of the owners of any equity ownership interest in
Franchisee to execute an agreement granting Franchisor an option to purchase
each of such owner’s interest in Franchisee upon an assignment as provided in
Section 17.7.

    


    17.9         Any
assignment based upon the legal incapacity of Franchisee, whether by operation
of law or otherwise, shall be subject to the Franchisor's written consent and
right of first refusal as provided herein.

    


    17.10       If
this Agreement is assigned, Franchisee shall remain liable to the Franchisor for
the obligations of the assignee hereunder and which arise as a result of acts,
events or omissions which occur prior to the effective date of the assignment or
within sixty (60) months following the effective date of the assignment; provided, however, that the
foregoing limitation on liability shall not reduce Franchisee's continuing
liability to the extent that Franchisee is a partner, shareholder or owner of an
interest in the assignee. The Franchisor's consent to any transfer hereunder
shall not constitute a waiver or release of any claims it may have against
Franchisee as of the date of the assignment.

     

    
      
        
        

      

      
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    17.11     
Any transfer of this Agreement or any interest in this Agreement or franchisee
by will or intestate succession, or the sale of this franchise or any interest
in Franchisee constituting a transfer pursuant to Section 17.7 by the executor
or administrator of Franchisee's or such shareholder's or person's estate, shall
be considered to be a transfer requiring compliance with the provisions of this
Section 17, including the requirements concerning the Franchisor's written
approval of the assignee, the assignee's qualifications and training, and the
execution of agreements.  In the event the Franchisor does not approve
the qualifications of any heir or beneficiary to operate the Restaurant, the
executor or administrator of Franchisee's estate shall have a period of twelve
(12) months following written disapproval to sell the franchise business to an
assignee acceptable to the Franchisor, during which twelve (12) month period the
Restaurant shall be operated in accordance with all the terms and provisions of
this Agreement.  Such sale shall be subject to the Franchisor's right
of first refusal pursuant to this Section 17.  If such a sale is not
concluded within that period, the Franchisor may terminate this
Agreement.

    


    17.12       If,
for convenience of ownership, Franchisee desires to assign this Agreement to an
Entity to hold its interest in this Agreement, Franchisor will consent to the
assignment of this Agreement to an Entity, provided that (i) none of the
securities of an Entity shall be traded on any public exchange or over the
counter market; (ii) the certificates or other evidence of ownership held by the
owner thereof shall contain a restriction on transfer referencing this Franchise
Agreement, in a form required by Franchisor; (iii) the ownership of the assignee
Entity shall be in the same proportion as the ownership of Franchisee
immediately prior to the transfer; and (iv) none of the shares of stock,
membership interests, voting power, equity or ownership interests in the
assignee Entity shall be held by or for the benefit of a business competitor of
Franchisor.  Franchisee shall pay an administrative fee of Five
Hundred Dollars ($500.00) per transfer for each transfer to an Entity where such
transfer is for the convenience of ownership only. At the time of request for a
transfer for the convenience of ownership, Franchisee shall submit the following
documents to Franchisor and Franchisor shall review and approve such documents
within thirty (30) days thereafter:


    a.           For
an assignment to a corporation, Franchisee shall provide to Franchisor a (i)
file stamped copy of the Articles of Incorporation (or comparable organizational
document) and By-laws of the proposed assignee corporation, (ii) a sample stock
certificate, (iii) a Certificate of Good Standing in the state in which the
corporation is authorized to do business and the state in which the corporation
will conduct the restaurant business pursuant to this Franchise Agreement, and
(iv) a list of directors, shareholders and officers and their percentage
ownership of the stock of the corporation.  Each share certificate of
a corporation shall contain a restriction on transfer in a form designated by
the Franchisor.

     

    
      
        
        

      

      
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    b.           For
an assignment to a partnership, Franchisee shall provide to Franchisor a (i)
file stamped copy of the Certificate of Limited Partnership (if applicable) or
the Statement of Partnership, and (ii) a copy of the fully executed Partnership
Agreement, containing an exhibit showing the percentage of ownership in the
partnership by all partners.  The partnership agreement shall contain
a restriction on transfer in a form designated by the Franchisor.

    


    c.           For
an assignment to a limited liability company, Franchisee shall provide to
Company (i) Certificate of Formation (or comparable organizational document) of
Limited Liability Company; (ii) a fully executed copy of the Operating
Agreement, containing an exhibit showing the percentage of ownership of all
members in the limited liability company; and (iii) the name of the manager or
managers of the limited liability company.  The operating agreement
shall contain a restriction on transfer in a form designated by the
Franchisor.

    


    d.           Franchisee
acknowledges that the purpose of the restrictions on transfer referenced in
Sections 17.12.a through 17.12.c above are to protect the Franchisor’s
trademarks, service marks, trade secrets, and operating procedures as well as
the  Franchisor’s general high reputation and image, and is for the
mutual benefit of the Franchisor, the Franchisee and other Franchisees of
the  Franchisor.  The Franchisor shall not unreasonably
restrict the issuance or transfer of stock or interests in a partnership or
limited liability company, provided that, in no event, shall any share of stock
of such assignee corporation, or an interest in a partnership or limited
liability be sold, assigned or transferred to a business of a competitor of the
Franchisor.

    


    17.13    
In connection with a sale by Franchisee of all or substantially all of the
assets relating to the Restaurant business, Franchisee may take a security
interest in the Restaurant and Franchisee's rights under this Agreement to
secure any financing that Franchisee provides to the purchaser for the purchase
of the Restaurant.  In the event of a default under such financing
arrangement and the exercise by Franchisee of its rights under such security
interest, Franchisee or the individual(s) purchasing the Restaurant out of a
foreclosure sale may become the franchisee under this Agreement, subject to its
compliance with each of the requirements set forth in this Section
17.

    


    18.           DEFAULT AND
TERMINATION

    


    18.1         In
addition to all other available rights and remedies, Franchisor shall have the
right to terminate this Agreement only for "cause".  "Cause" is hereby
defined as a material breach of this Agreement, including but not limited to any
of the facts or circumstances specified in Sections 18.2 or 18.3.

    


    18.2         In
addition to all other available rights and remedies, the Franchisor shall have
the right upon the occurrence of any of the following events to immediately
terminate this Agreement by giving written notice to Franchisee, which
termination shall become effective immediately upon the giving of such
notice.

     

    
      
        
        

      

      
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    a.           Abandonment
of the Restaurant by Franchisee by failing to operate the Restaurant business
for ten (10) consecutive days or any shorter period of time after which the
Franchisor reasonably determines that Franchisee does not intend to continue to
operate the business, unless such failure is due to fire, flood, earthquake or
other similar cause beyond Franchisee's control, in which case Franchisee shall
comply with each of the requirements set forth in Section 23.17;

    


    b.           Franchisee
admits to an inability to pay its debts as the same become due, is declared
bankrupt or judicially determined to be insolvent, or all or a substantial part
of the assets thereof are assigned to or for the benefit of any creditor, or
Franchisee admits its inability to pay its debts as they come due;

    


    c.           A
levy of execution is made upon the Restaurant, the license granted by this
Agreement or upon any property used in the Restaurant business, and it is not
discharged within five (5) days of such levy;

    


    d.           The
Restaurant business, equipment or premises are seized, taken over or foreclosed
by a creditor, lienholder or lessor, provided that a final judgment rendered
against Franchisee remains unsatisfied for at least thirty (30) days and a
supersedes or other appeal bond has not been filed;

    


    e.           The
right to occupy or lease the Location is lost or terminated and Franchisee has
not relocated the Restaurant, if permitted, pursuant to Section
23.17;

    


    f.           Franchisee
or any of its partners, officers, directors or principal shareholders is
convicted of a felony or any other criminal misconduct that is relevant to the
operation of the Restaurant;

    


    g.           The
failure of Franchisee to reach each milestone and to open and operate the
Restaurant in accordance with and by the time set forth in
Sections  4.2, 4.3 and 4.4.;

    


    h.           Any
purported assignment, transfer or sublicense of this franchise, or any right
hereunder, without the prior written consent of the Franchisor;

    


    i.           Any
material misrepresentation is made by Franchisee in connection with the
acquisition of the franchise herein;

    


    j.           Franchisee
engages in conduct which reflects materially and unfavorably upon the operation,
the reputation of the Restaurant business, the El Pollo Loco®
System, or the goodwill associated with the El Pollo Loco®
Marks;

    


    k.           Franchisee
repeatedly fails to comply with one (1) or more material standards or
requirements of this Agreement (or as specified in the Manual), whether or not
corrected after notification thereof.  A repetition within a one-year
period of any default shall justify the Franchisor in terminating this Agreement
upon written notice to the Franchisee without allowance for any curative
period;

     

    
      
        
        

      

      
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    l.           Failure
of Franchisee, for a period of ten (10) days after notification of
noncompliance, to comply with any federal, state or local law or regulation
applicable to the operation and maintenance of the Restaurant, including, but
not limited to, public health and safety requirements; or

    


    m.           Reasonable
determination on the part of the Franchisor that continued operation of the
Restaurant by Franchisee will result in an imminent danger to public health or
safety; or

    


    n.           Except
for noncompliance otherwise covered by Subparagraph 18.2.l above, failure of
Franchisee to correct a deficiency or unsatisfactory condition referred to in an
Inspection Report (discussed in Section 15 hereof) which the Franchisor
reasonably determines may have a material adverse effect on the ownership or
operation of the Restaurant after having received a reasonable opportunity to
cure such deficiency or unsatisfactory condition, which in no event need be more
than thirty (30) days.

    


    18.3        Except
for any default by Franchisee under Section 18.2, or as otherwise expressly
provided in this Agreement, Franchisee shall have 10 days (5 days in the case of
any default in the timely payment of sums due to Franchisor or its affiliates),
after Franchisor's written notice of a material default within which to remedy
any material default under this Agreement, and to provide evidence of such
remedy to Franchisor.  If any such default is not cured within that
time period, or such longer time period as applicable law may require or as
Franchisor may specify in the notice of default, this Agreement and all rights
granted by it shall thereupon automatically terminate without further notice or
opportunity to cure.

    


    Franchisee
shall be in material default under this Section for any failure to comply with
any of the requirements imposed by this Agreement.  Such material
defaults shall include, but are not limited to, the occurrence of any one or
more of the following events:

    


    a.           Failure
of Franchisee to pay to the Franchisor any fees, costs, charges or other amounts
due under this Agreement;

    


    b.           Failure
of Franchisee to pay when due any rent, taxes or other payments required under
any sublease with the Franchisor for the Location;

    


    c.           Failure
of Franchisee to cure any default by Franchisee under any loan, note or other
obligation which is obtained to assist Franchisee to make any payment due the
Franchisor hereunder or which is secured by all or any part of Franchisee's
interest in the Restaurant, the Location, and/or the improvements or furniture,
fixtures or equipment therein;

    


    
      d.          
The
attachment of any involuntary lien in the sum of One Thousand Dollars
($1,000.00) or more upon any of the business assets or property of Franchisee,
which lien is not removed, or for which Franchisee does not post a bond
sufficient to satisfy such lien, within thirty (30) days of the filing of such
lien;

    

     

    
      
        
        

      

      
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    e.           In
the event that Franchisee leases or subleases the Location and/or the leasehold
improvements thereon from a third party, the failure of Franchisee to cure any
and all defaults under the terms and provisions of any such lease or sublease
within the time provided for the curing of any such default(s) in any such lease
or sublease;

    


    f.           The
failure of Franchisee to cure any and all defaults under the terms and
provisions of any other agreement with the Franchisor, or any third party
relating to this franchise or the operation or ownership of the Restaurant,
including any other Franchise Agreement, lease or promissory note between the
Franchisor or its affiliate and Franchisee within the time provided for the
curing of any such defaults in any such other agreement, lease or promissory
note;

    


    g.           Franchisee’s
misuse or unauthorized use of the El Pollo Loco®
Marks; or

    


    h.           Failure
of Franchisee to comply with any standard or requirement of this Agreement which
is not otherwise covered in this Section 18.

    


    18.4        Notwithstanding
anything to the contrary contained in this Section 18, in the event any valid,
applicable law of a competent governmental authority having jurisdiction over
this Agreement and the parties hereto shall limit Franchisor’s rights of
termination hereunder or shall require longer notice periods than those set
forth above, this Agreement shall be deemed amended to conform to the minimum
notice periods or restrictions upon termination required by such laws and
regulations.  Franchisor shall not, however, be precluded from
contesting the validity, enforceability or application of such laws or
regulations in any action, hearing or dispute relating to this Agreement or the
termination thereof.

    


    18.5        Franchisor
shall not, and can not be held in breach of this Agreement until (i) Franchisor
has received written notice from Franchisee describing in detail any alleged
breach; and (ii) Franchisor has failed to remedy the breach within a reasonable
period of time after such notice, which period shall not be less than 60 days
plus such additional time as reasonably required by Franchisor if because of the
nature of the alleged breach it cannot reasonably be cured within said 60 days,
provided Franchisor promptly commences and continues diligently to cure such
alleged breach.  Except for breach hereof by the Franchisor (subject
to the preceding sentence) or as permitted under Section 24.17 hereof,
Franchisee shall have no right to terminate this Agreement.

    


    19.          RIGHTS AND OBLIGATIONS UPON
TERMINATION

    


    19.1        In
the event of expiration or earlier termination of this Agreement:

    


    a.           Franchisee
shall promptly cease to use, in any manner and for any purpose, directly or
indirectly, the El Pollo Loco®
Marks, the El Pollo Loco®
System, Franchisor’s trade secrets, propriety information, policies, procedures,
techniques, methods and materials used by Franchisee in connection with the
franchise relationship and shall immediately return to Franchisor any and all
tangible (including electronic) copies of any of the foregoing, including, but
not limited to:

     

    
      
        
        

      

      
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    i.           Specifications,
recipes and descriptions of food products;

    


    ii.          The
Manual, memoranda, bulletins, forms, reports, instructions and supplements
thereto;

    


    iii.         Training
methods and materials provided by the Franchisor hereunder;

    


    iv.         Brochures,
posters and other advertising materials; and

    


    v.          All
items bearing or containing the El Pollo Loco®
Marks, including without limitation, all trademarks, trade names, service marks,
logotypes, designs and other identifying symbols and names pertaining
thereto.

    


    b.           Franchisee
shall immediately remove, obliterate or destroy all signs and advertisements
identifiable in any way with the Franchisor's name and perform such reasonable
redecoration and remodeling of the Restaurant and the Location as may be
necessary, in the Franchisor's judgment, to distinguish it from an El Pollo
Loco®
restaurant.  To the extent that Franchisor is required under
applicable law to repurchase certain goods from Franchisee, Franchisee hereby
grants to the Franchisor the option to purchase all paper goods, containers and
all other items containing the Franchisor's name or the El Pollo Loco®
Marks which are in re-saleable or reusable condition at the lower of their cost
or fair market value at the time of termination;

    


    c.           The
Franchisor may retain all fees paid pursuant to this Agreement;

    


    d.           On
any termination or expiration of this Agreement, whether due to a default of
Franchisee or otherwise, the Franchisor shall have the right, at its option, for
thirty (30) days after such termination or expiration to elect to purchase
Franchisee's interest in the leasehold improvements and furniture, fixtures,
equipment, and any or all of the other tangible Restaurant assets (collectively,
“Assets”) at a purchase price equal to the lesser of Franchisee's cost or the
fair market value of such Assets, and to purchase Franchisee's inventory at
Franchisee's cost thereof.  If the parties hereto cannot agree on the
fair market value within forty-five (45) days of any such date of termination or
expiration, the Franchisor shall designate an independent appraiser whose
determination shall be binding.  If the Franchisor elects to exercise
any option to purchase as herein provided, it shall have the right to set off
all amounts due from Franchisee and the costs of the appraisal, if any, against
any payment therefore.

    


    19.2        Upon
the expiration or termination of this Agreement, Franchisee shall promptly pay
all sums owing to the Franchisor and its subsidiaries and
affiliates.  In the event of termination by reason of any default of
Franchisee, such sums shall include all damages, costs and expenses, including
reasonable attorneys' fees, incurred by the Franchisor as a result of the
default, which obligation shall give rise to and remain, until paid in full, a
lien in favor of the Franchisor against any and all of the personal property,
furnishings, equipment, signs, fixtures, and inventory owned by Franchisee
located in the Restaurant operated hereunder at the time of any such
default.  Franchisee agrees to pay interest to the Franchisor on any
amounts which may become due to the Franchisor from Franchisee, if such are not
paid when due, at the rate of fifteen percent (15%) per annum or the maximum
interest rate permitted by law, whichever is less.

     

    
      
        
        

      

      
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    19.3         The
expiration or termination of this Agreement shall be without prejudice to the
rights and remedies of the Franchisor against
Franchisee.  Furthermore, such expiration or termination shall neither
release Franchisee or any of its obligations and liabilities to the Franchisor
existing at the time thereof nor terminate those obligations and liabilities of
Franchisee which, by their nature, survive the expiration or termination of this
Agreement.

    


    19.4         Upon
expiration or termination of this Agreement, the Franchisor may remove all
references to the Franchise and/or to the Restaurant from its
website(s).

    


    20.           RIGHTS TO A SUCCESSOR
FRANCHISE

    


    20.1         Franchisee
shall have the right, subject to the conditions contained in this Section 20.1,
to acquire a successor franchise for the Restaurant on the terms and conditions
of the Franchisor's then current form of Franchise Agreement and for a term of
ten (10) years (a "Successor Term") commencing on the expiration of the term of
this Agreement.  Franchisee's right to a successor franchise shall be
conditioned upon the satisfaction of each of the following conditions prior to
the expiration of the term of this Agreement:  (a) Franchisee is in
compliance with this Agreement in all respects including financial and
operational compliance and has been in substantial compliance with this
Agreement throughout the term; (b) the Franchisor has not notified Franchisee of
its decision that any federal or applicable state legislation, regulation or
rule which is enacted, promulgated or amended after the date hereof may have an
adverse effect on the Franchisor's rights, remedies or discretion in franchising
El Pollo Loco®
restaurants; (c) Franchisee maintains the right to possession of the Location
for the term of the successor Franchise Agreement; (d) Franchisee shall have
paid the renewal fee described in the final sentence of this Section 20.1; and
(e) Franchisee satisfies each of the conditions and executes and delivers the
agreement described in Sections 20.2, 20.3 and 20.4 below.  Franchisee
will be obligated to pay a renewal fee equal to 50% of the Franchisor's then
current standard initial franchise fee if Franchisee elects a Successor
Term.

    


    20.2         Franchisee
must give the Franchisor written notice of Franchisee's desire to acquire a
successor franchise at least three hundred sixty (360) days prior to the
expiration of this Agreement.  The Franchisor will give Franchisee
notice, not later than sixty (60) days after receipt of notice, of the
Franchisor's decision as to whether or not Franchisee has the right to acquire a
successor franchise pursuant to Section 20.1.  Notwithstanding notice
of the Franchisor's decision that Franchisee has the right to acquire a
successor franchise for the Restaurant, Franchisee's right to acquire a
successor franchise will be subject to Franchisee's continued compliance with
all of the terms of this Agreement up to the date of its
expiration.

     

    
      
        
        

      

      
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    20.3         If
Franchisee exercises the right to acquire a successor franchise in accordance
with Section 20.2 above, Franchisee shall enter into an agreement with the
Franchisor within sixty (60) days following delivery of the written notice
pursuant to Section 20.2, agreeing to remodel the Restaurant, add or replace
improvements, fixtures, furnishings, equipment and signs, and otherwise modify
to upgrade the Restaurant to the specifications, image and standards then
applicable for new El Pollo Loco®
restaurants.  All such remodelings, additions and replacements must be
completed prior to the effective date of such successor Franchise
Agreement.

    


    20.4         If
Franchisee has the right to acquire a successor franchise in accordance with
Section 20.1 and exercises that right in accordance with Section 20.2, the
parties must execute the form of Franchise Agreement (which may contain
provisions, including royalty and advertising fees, materially different from
those contained herein) and all ancillary agreements which the Franchisor then
customarily uses in granting renewal franchises for the operation of El Pollo
Loco®
restaurants, and Franchisee must execute general releases, in form and substance
satisfactory to the Franchisor, of any and all claims against the Franchisor and
its affiliates, officers, directors, employees, agents, successors and assigns.
Failure by Franchisee to sign such agreements and releases within thirty (30)
days after delivery thereof to Franchisee shall be deemed an election by
Franchisee not to acquire a successor franchise.

    


    21.           PROPRIETARY RIGHTS AND UNFAIR
COMPETITION

    


    21.1         In
the event of any claim of or challenge to Franchisee's use of the El Pollo
Loco®
Marks licensed under this Agreement, Franchisee shall immediately notify the
Franchisor in writing of the facts of such claim or challenge.

    


    a.           The
Franchisor shall protect and defend Franchisee against any claims or challenges
arising out of Franchisee's proper use of the El Pollo Loco®
Marks licensed hereunder.


    b.           The
Franchisor shall reimburse Franchisee for all damages for which it is held
liable in any such proceeding; however, the foregoing obligations of the
Franchisor to protect, defend and reimburse Franchisee will exist only if
Franchisee has used the name or mark which is the subject of the controversy in
strict accordance with the provisions of this Agreement and the rules,
regulations, procedures, requirements and instructions of the Franchisor and has
notified the Franchisor of the challenge as set forth above.

    


    c.           Any
action to be taken in the event of a claim or challenge to any of the El Pollo
Loco®
Marks shall be solely in the discretion of the Franchisor.  The
Franchisor shall have the sole right to control any legal actions or proceedings
resulting therefrom.  Any actions taken to protect the El Pollo
Loco®
Marks shall also be within the sole discretion and control of the
Franchisor.  Franchisee shall cooperate fully with the Franchisor in
the prosecution or defense of any claim or challenge concerning any of the El
Pollo Loco®
Marks.

     

    
      
        
        

      

      
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    21.2         If
it becomes advisable at any time, in the sole discretion of the Franchisor, to
modify or discontinue the use of any one or more of the El Pollo Loco®
Marks or to use one or more additional or substitute names, marks or copyrights,
Franchisee agrees to immediately comply with the instructions of the Franchisor
in that regard.  In such event, the sole obligation of the Franchisor
will be to reimburse Franchisee for the actual costs, such as replacing sign
faces, of physically complying with this obligation.

    


    21.3         Franchisee
acknowledges and agrees that at all times and in all respects, the El Pollo
Loco®
Marks are the sole property of the Franchisor and that Franchisee has only a
license to use such rights and marks according to the provisions
hereof.  Franchisee shall make no application for registration of any
identifying name or mark licensed herein or similar thereto without the prior
written consent of, and upon terms and conditions satisfactory to, the
Franchisor.  Franchisee shall not register any of the El Pollo
Loco®
Marks, part thereof, or anything confusingly similar thereto, as a domain name,
or use, or permit the usage of, any of the same in connection with any Internet
web site or web page.  Franchisee agrees to indicate the required
trademark, service mark or copyright notices in the form specified by the
Franchisor in connection with its use of the El Pollo Loco®
Marks.  Franchisee agrees to take no action which will interfere with
any of the Franchisor's rights in and to the El Pollo Loco®
Marks.  Franchisee shall not, without the Franchisor's prior written
consent, sell, dispense or otherwise provide the Franchisor's products bearing
the El Pollo Loco® Marks,
except by means of retail sales in, or delivered from, the
Restaurant.

    


    21.4   a.   Franchisor
may, at its option, establish and maintain an Internet through which franchisees
of Franchisor may communicate with each other, and through which Franchisor and
Franchisee may communicate with each other and through which Franchisor may
disseminate the Manuals, updates thereto and other confidential
information.  Franchisor shall have sole discretion and control over
all aspects of the Intranet, including the content and functionality
thereof.  Franchisor will have no obligation to maintain the Intranet
indefinitely, and may dismantle it at any time without Franchisor having any
liability to Franchisee.  As used herein, the term “Intranet” shall
mean an intranet, extranet or other communication network between and among
Franchisor and Franchisee that is accessed by the Internet.  As used
herein, the term “Internet” shall mean collectively the myriad of computer and
telecommunications facilities, including equipment and software, which comprise
the interconnected worldwide network of networks that employ the TCP/IP
[Transmission Control Protocol/Internet Protocol], or any predecessor or
successor protocols to such protocol, to communicate information of all kinds by
fiver optics, wire, radio or other methods of electronic
communication.

    


    b.           If
Franchisor establishes an Intranet, Franchisee shall have the privilege to use
the Intranet, subject to Franchisee’s strict compliance with the standards and
specifications, protocols and restrictions that Franchisor may establish from
time to time.  Such standards and specifications, protocols and
restrictions may relate to, among other things, (i) use of abusive, slanderous
or otherwise offensive language in electronic communications; (ii) confidential
treatment of materials that Franchisor transmits via the Intranet; (iii)
password protocols and other security precautions; (iv) grounds and procedures
for Franchisor’s suspending or revoking a franchisee’s access to the Intranet;
and (v) a privacy policy governing Franchisor’s access to and use of electronic
communications that franchisees post to the Intranet.  Franchisee
acknowledges that, as administrator of the Intranet, Franchisor can technically
access and view any communication that any person posts on the
Intranet.  Franchisee further acknowledges that the Intranet facility
and all communications that are posted to it will become Franchisor’s property,
free of any claims of privacy or privilege that Franchisee or any other person
may assert.

     

    
      
        
        

      

      
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    c.           Upon
receipt of notice from Franchisor that Franchisor has established the Intranet,
Franchisee shall establish and continually maintain (during all times that the
Intranet shall be established and until the termination of this Agreement) an
electronic connection (the specifications of which shall be specified in the
Manuals) with the Intranet that allows Franchisor to send messages to and
receive messages from Franchisee, subject to the standards and
specifications.

    


    d.           Franchisee
shall contribute a reasonable amount, not to excess $1,000.00 per year (which
maximum amount shall increase at a rate of 3% per calendar year during the term
of this Agreement, toward the cost of the Intranet’s
maintenance.  Such contribution shall be established by Franchisor by
not later that March 1 of each calendar year and shall be payable thirty (30)
days thereafter.

    


    e.           If
Franchisee shall breach this Agreement or any other agreement with Franchisor or
its Affiliates, Franchisor may disable or terminate Franchisee’s access to the
Intranet without Franchisor having any liability to Franchisee, and in which
case Franchisor shall only be required to provide Franchisee a paper copy of the
Manuals and any updates thereto, if none have been previously provided to
Franchisee, unless not otherwise entitled to the Manuals.

    


    21.5         Franchisor
has established a Website.  As used herein, the term “Website” shall
mean one or more Internet websites that may, among other things, provide
marketing development operations and training materials, facilitate catering,
take-out and delivery orders, provide information about the System and the
products and services which are offered on such Website and at restaurants
operated under the El Pollo Loco®
Marks.

    


    a.           Franchisor
may, at its sole discretion, from time to time, without prior notice to
Franchisee: (i) change, revise, or eliminate the design, content and
functionality of the Website; (ii) make operational changes to the Website;
(iii) change or modify the URL and/or domain name of the Website; (iv)
substitute, modify, or rearrange the Website, at Franchisor’s sole option,
including in any manner that Franchisor considers necessary or desirable to,
among other things, (1) comply with applicable laws, (2) respond to changes in
market conditions or technology, and (3) respond to any other circumstances; (v)
limit or restrict end-users access (in whole or in part) to the Website; and
(vi) disable or terminate the Website without Franchisor having any liability to
Franchisee.

     

    
      
        
        

      

      
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    b.           The
Website may include one or more interior pages that identifies restaurants
operated under the El Pollo Loco® Marks,
including the Restaurant, by among other things, geographic region, address,
telephone number(s), and menu items.  The Website may also include one
or more interior pages dedicated to franchise sales by Franchisor and/or
relations with Franchisor’s investors.

    


    c.           
Franchisor may, from time to time, establish the Franchisee Page.  As
used herein, the term “Franchisee Page” shall mean one or more interior pages of
the Website dedicated in whole or in part to Franchisee’s
Restaurant.  Franchisor may permit Franchisee to customize or post
certain information to the Franchisee Page, subject to Franchisee’s execution of
Franchisor’s then-current participation agreement, and Franchisee’s compliance
with the procedures, policies, standards and specifications that Franchisor may
establish from time to time.  Such participation agreement may require
the Franchisee to pay a reasonable fee (not to exceed $1,000.00 per year, which
maximum shall increase at a rate of 3% per year for the term of this Agreement)
for the privilege of having a Franchisee Page, and may include, without
limitation, specifications and limitations for the data or information to be
posted to the Franchisee Page, customization specifications, the basic template
for design of the Franchisee Page, parameters and deadlines specified by
Franchisor, disclaimers, and such other standards and specifications and rights
and obligations of the parties as Franchisor may establish from time to
time.  Any modifications (including customizations, alterations,
submissions or updates) to the Content made by Franchisee for any purpose will
be deemed to be a “work made for hire” under the copyright laws, and therefore,
Franchisor shall own the intellectual property rights in and to such
modifications.  To the extent any modification does not qualify as a
work made for hire as outlined above, Franchisee hereby assigns those
modifications to Franchisor for no additional consideration and with no further
action required and shall execute such further assignment(s) as Franchisor may
request.

    


    d.           Without
limiting Franchisor’s general unrestricted right to permit, deny and regulate
Franchisee’s participation on the Website in Franchisor’s sole discretion, if
Franchisee shall breach this Agreement, or any other agreement with Franchisor
or its Affiliates, Franchisor may disable or terminate the Franchisee Page and
remove all references to the Restaurant on the Website until said breach is
cured.

    


    21.6         Franchisee
acknowledges that, in connection with the operation of the franchise business,
the Franchisor will be disclosing confidential information and trade secrets to
Franchisee.  Franchisee further acknowledges that its knowledge of,
and access to, the Franchisor's formulae, recipes, processes, products,
techniques, know-how and other proprietary information, including without
limitation the Manual and the El Pollo Loco® System
(collectively referred to as the "Confidential Information"), are derived
entirely from the material disclosed to Franchisee by the
Franchisor.  Franchisee acknowledges and agrees that at all times and
in all respects, the Confidential Information is a trade secret of the
Franchisor and that Franchisee has only a license to use the Confidential
Information according to the provisions of this Agreement.

     

    
      
        
        

      

      
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    a.           Franchisee,
and each officer, director, shareholder, member, manager, partner, and other
equity owner, as applicable, of Franchisee, if Franchisee is an Entity, agrees
to maintain fully and strictly the secrecy of all the Confidential Information
and to exercise the highest degree of diligence in safeguarding the Confidential
Information during and after the term of this Agreement.  Franchisee
shall divulge the Confidential Information only to Franchisee's employees and
only to the extent necessary to permit the efficient operation of the Restaurant
during the effective term of this Agreement.  After the expiration or
termination of this Agreement, Franchisee shall not divulge the Confidential
Information to any person or entity, nor shall Franchisee use the Confidential
Information in any manner.

    


    b.           It
is expressly agreed that the ownership of all of the El Pollo Loco® Marks
and the Confidential Information is and shall remain vested solely in the
Franchisor.  Nothing contained in this Agreement shall be construed to
require the Franchisor to divulge to Franchisee any secret processes, formulae,
ingredients or other information, except the material contained in the
Franchisor's Manual and training materials.

    


    21.7         To
further protect the El Pollo Loco® System
while this Agreement is in effect, Franchisee and each officer, director,
shareholder, member, manager, partner, and other equity owner, as applicable, of
Franchisee, if Franchisee is an Entity, shall neither directly nor indirectly
own, operate, control or have any financial interest in any other business which
would constitute a "Competitive Business" (as hereinafter defined) without the
prior written consent of the Franchisor; provided further, that the
Franchisor may, in its sole discretion, consent to the Franchisee's continued
operation of any business already in existence and operating at the time of
execution of this Agreement.  In addition, Franchisee covenants that,
except as otherwise approved in writing by the Franchisor, Franchisee shall not,
for a continuous, uninterrupted period commencing upon the expiration,
termination or assignment of this Agreement, regardless of the cause for
termination, and continuing for two (2) years thereafter, either directly or
indirectly, for itself, or through or on behalf of, or in conjunction with any
person, partnership, corporation or other entity, own, operate, control or have
any financial interest in any Competitive Business which is located or has
outlets or restaurant units within a radius of five (5) miles of the location of
the Restaurant.  The foregoing shall not apply to operation of an El
Pollo Loco®
restaurant by Franchisee pursuant to another Franchise Agreement with the
Franchisor or the ownership by Franchisee of less than five percent (5%) of the
issued or outstanding stock of any company whose shares are listed for trading
on any public exchange or on the over-the-counter market, provided that
Franchisee does not control or become involved in the operations of any such
company.  For purposes of this Section 21.7, a Competitive Business
shall mean a self-service restaurant or fast-food business which sells chicken
and/or Mexican food products, which products individually or collectively
represent more than fifty percent (50%) of the revenues from such self-service
restaurant or fast-food business operated at any one location during any
calendar quarter. A “Competitive Business” shall not include a full-service
restaurant.


    
      
         


      

      
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    21.8        In
the event that any provision of this Section 21 shall be determined by a court
of competent jurisdiction to be invalid or unenforceable, this Agreement shall
not be void, but such provision shall be limited to the extent necessary to make
it valid and enforceable.

    


    22.          RESOLUTION OF DEVELOPMENT
DISPUTES

    


    22.1        Arbitration
of Development Dispute - Franchisee agrees that any dispute that arises out of a
decision by the Franchisor to develop or authorize development of a new
restaurant shall be resolved solely in the manner contemplated by the
Franchisor's Procedures for Resolving Disputes Relating to the Development of
New Restaurants, a copy of which is attached as Exhibit 1 and which is
incorporated into this Agreement.  Franchisee acknowledges that it
shall have no claim or right under such process with respect to the development
of a new restaurant unless such new restaurant would be located within
Franchisee's "Notification Radius" (as that term is defined in Exhibit 1).

    


    22.2        Mediation
of All Other Disputes - The following shall apply to any controversy between
Franchisor and Franchisee (including its affiliates) relating (a) to this
Agreement, (b) the parties business activities conducted as a result of this
Agreement, or (c) the parties’ relationship or business dealings with each other
generally.

    


    The parties shall first use their best
efforts to meet and discuss and negotiate a resolution of the
controversy.

    


    If negotiation efforts do not succeed,
the parties shall engage in mandatory but non-binding mediation by a mediator
jointly chosen by the parties or if the parties cannot agree upon a mediator, by
the American Arbitration Association for disputes relating to locations outside
of California or Franchise Arbitration and Mediation Services, Newport Beach,
California, for disputes relating to locations within California.

    


    A mediation meeting will be held at a
place and at a time mutually agreeable to the parties and the
mediator.  The Mediator will determine and control the format and
procedural aspects of the mediation meeting which will be designed to ensure
that both the mediator and the parties have an opportunity to present and hear
an oral presentation of each party’s views regarding the matter in
controversy.  The parties agree to use good faith efforts to resolve
the controversy in mediation.

    


    The mediation will be held as soon as
practicable after the negotiation meeting is held.

    


    The mediator will be free to meet and
communicate separately with each party either before, during or after the
mediation meeting.

    


    In the event that either party requires
a substantial amount of information in the possession of the other party in
order to prepare for the mediation meeting, the parties will attempt, in good
faith, to agree on procedures for the expeditious exchange of such
information.  If the parties fail to agree on such procedures, the
mediator will determine such procedures and which documents and information will
be informally exchanged.

    


    Each party may be represented by one or
more other persons, including its counsel, one or more of its business persons,
an accountant and a financial consultant.  At least one representative
of each party must have the authority to agree upon a settlement of the
controversy.

     

    
      
        
        

      

      
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    The mediator may freely express his/her
views to the participants on the legal issues unless a participant objects to
his doing so.  The mediator may obtain assistance and independent
expert advice with the agreement of the participants and at the participants’
expense.  The mediator will not be liable for an act or omission in
connection with the role of mediator, other than for gross negligence or willful
misconduct.

    


    If requested by the mediator, each
party shall prepare a written summary of its position to the mediator in advance
of the mediation meeting.

    


    The mediator may raise legal questions
and arguments.

    


    If the parties have failed to reach an
acceptable settlement prior to the end of the mediation meeting, the mediator
before concluding the mediation meeting, may submit to the parties a settlement
proposal which the mediator deems to be equitable to both
parties.  Each of the parties will, in good faith, evaluate the
proposal and discuss it with the mediator.  In the event that a
settlement is not reached, neither the terms of the proposed settlement nor
either party’s refusal to agree thereto shall be admissible in any subsequent
arbitration or court proceedings.

    


    If a settlement is reached, the
mediator or one of the parties at the request of the mediator, will prepare a
settlement agreement for execution by the parties.  Such settlement
agreement will be revised by the parties and when, in a mutually acceptable
form, executed and delivered to each other, such that each party shall receive a
duplicate original.

    


    The parties will cooperate and continue
to mediate until the mediator terminates the mediation.  The mediator
will terminate the mediation upon the earlier of (i) execution of a settlement
agreement, (ii) a declaration by the mediator that the mediation is terminated,
or (iii) completion of a full day mediation meeting unless extended by agreement
of the parties.

    


    At the election of the Franchisor, the
provisions of this Section 22 shall not apply to controversies relating to any
fee due the Franchisor by Franchisee or its affiliates, any promissory note
payments due the Franchisor by Franchisee, or any trade payables due the
Franchisor by Franchisee as a result of the purchase of equipment, goods or
supplies.  The provisions of this Section 22 shall also not apply to
any controversies relating to the use and protection of the El Pollo Loco Marks,
the Manual or the El Pollo Loco System, including without limitation, the
Franchisor’s right to apply to any court of competent jurisdiction for
appropriate injunctive relief for the infringement of the El Pollo Loco Marks or
the El Pollo Loco System.

    


    23.          MISCELLANEOUS
PROVISIONS

    


    23.1       
In the event that Franchisee is comprised of more than one person, firm,
corporation or other entity, Franchisee's rights, privileges, interests,
obligations and liabilities under this Agreement shall be joint and several with
respect to such persons, firms, corporations or other entities.

     

    
      
        
        

      

      
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    23.2         If
Franchisee is an Entity, Franchisor will require, as a condition to the
effectiveness hereof, the written guarantee and assumption of Franchisee's
obligations hereunder by any or all of the shareholders, members, partners,
other equity owners, as applicable, of an Entity and or some other natural
persons associated with Franchisee, the form of which is attached hereto as
Exhibit
“3”.  The Franchisor may also require that Franchisee maintain
transfer instructions restricting a transfer on its records of any securities,
partnership interests or other ownership interests in violation of the
restrictions set forth in Section 17 and that each stock, partnership or other
ownership certificate of Franchisee shall have conspicuously endorsed upon its
face a statement in form satisfactory to the Franchisor that further assignment
or transfer thereof is subject to each of the restrictions imposed upon
assignments by this Agreement.

    


    23.3         All
notices required under this Agreement shall be in writing and shall be either
(i) served personally; (ii) sent by certified or registered United States mail
to the party to be charged with receipt thereof; (iii) by reputable overnight
delivery service or (iv) sent via facsimile.  Notices served
personally are effective immediately on delivery, and those served by mail shall
be deemed given forty-eight (48) hours after deposit of such notice in a United
States post office with postage prepaid and duly addressed to the party to whom
such notice or communication is directed.  Notices served by overnight
delivery shall be deemed to have been given the day after deposit of such notice
with such service.  Notices served via facsimile shall be deemed to
have been given the day of faxing such notice.  The address for the
Franchisor shall be: Attention: General Counsel, El Pollo Loco, Inc., 3535
Harbor Blvd, Suite 100, Costa Mesa, California 92626, and the address and
facsimile number for the Franchisee shall be the address and facsimile number
listed on the cover page of this Agreement.  The Franchisor or
Franchisee may from time to time change its address for notice pursuant to this
Section by giving a written notice of such change to the other party in the
manner provided herein.  Notwithstanding anything to the contrary
contained herein, the Franchisor may deliver bulletins and updates to the Manual
by electronic means, such as by the internet (e-mail) or an intranet, if any,
established by Franchisor.

    


    23.4         The
receipt and acceptance by either party of any delinquent payment due hereunder
shall not constitute a waiver of any other default.  Except as
provided by the foregoing, no delay or omission in the exercise of any right or
remedy of either party upon any default by the other hereunder shall impair such
right or remedy or be construed as a waiver of any term, covenant or condition
of this Agreement to be performed by the other party.  Any waiver of
any other default must be in writing and shall not constitute a waiver of any
other default concerning the same or any other term, covenant or condition of
this Agreement.

    


    23.5         The
Franchisor's consent to or approval of any act or conduct of Franchisee
requiring such consent or approval shall not be deemed to waive or render
unnecessary the Franchisor's consent to or approval of any subsequent act or
conduct hereunder.

     

    
      
        
        

      

      
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    23.6         The
provisions of this Agreement are intended by the parties to be a complete and
exclusive expression of their agreement.  Other than the El Pollo
Loco®
Franchise Disclosure Document circulated with this Agreement (and its exhibits
and attachments), no other agreements, representations, promises, commitments or
the like, of any nature, exist between the parties except as set forth or
referenced herein.  The provisions of this Agreement may not be
contradicted by any other statement concerning the subject matter herein (other
than as described in the El Pollo Loco®
Franchise Disclosure Document).  Furthermore, this Agreement
may not be amended or modified except by a written agreement signed by the
parties hereto.

    


    23.7         In
the event of the bringing of any action by either party against the other
arising out of or in connection with this Agreement or the enforcement thereof,
or by reason of the breach of any term, covenant or condition of this Agreement
on the part of either party, the party in whose favor final judgment is entered
shall be entitled to have and recover from the other party reasonable attorneys'
fees to be fixed by the court rendering such judgment.

    


    23.8         This
Agreement shall be governed by and construed in accordance with the laws of the
State of California, except for the provisions in Section 21.7 covering
competition following the expiration, termination or assignment of this
agreement which shall be governed by the laws of the state in which the breach
occurs. Except as provided in Section 22, the parties agree that any action
brought by either party against the other in any court, whether federal or
state, will be brought within the State of California.  The parties
hereby waive any right to demand or have trial by jury in any action relating to
this Agreement in which the Franchisor is a party.  The parties
consent to the exercise of personal jurisdiction over them by such courts and to
the propriety of venue of such courts for the purpose of carrying out this
provision, and they waive any objection that they would otherwise have to the
same.

    


    23.9         Except
with respect to Franchisee's obligation to indemnify the Franchisor pursuant to
Section 9.3 of this Agreement, the parties waive to the fullest extent permitted
by the law any right to or claim for any punitive or exemplary damages against
the other and agree that, in the event of a dispute between them, the party
making a claim shall be limited to recovery of any actual damages it
sustains.

    


    23.10     
Any provision of this Agreement which may be determined by competent authority
to be prohibited or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of the prohibition or
unenforceability without invalidating the remaining provisions of this
Agreement.  Any prohibition against or unenforceability of any
provision of this Agreement in any jurisdiction, including the state whose law
governs this Agreement, shall not invalidate the provision or render it
unenforceable in any other jurisdiction.  To the extent permitted by
applicable law, Franchisee waives any provision of law which renders any
provision of this Agreement prohibited or unenforceable in any
respect.

    


    23.11      Franchisee
recognizes the unique value and secondary meaning attached to the El Pollo
Loco® System,
the El Pollo Loco® Marks,
the Confidential Information and the associated standards of operation and trade
practices, and Franchisee agrees that any noncompliance with the terms of this
agreement or any unauthorized or improper use will cause irreparable damage to
the Franchisor and its franchisees.  Franchisee therefore agrees that
if it should engage in any such unauthorized or improper use, during or after
the term of this Agreement, the Franchisor shall be entitled to both permanent
and temporary injunctive relief from any court of competent jurisdiction in
addition to any other remedies prescribed by law.

     

    
      
        
        

      

      
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    23.12     
Franchisee shall grant no security interest in the franchise any of the tangible
assets of the business including the furniture, fixtures and equipment located
in the Restaurants, unless the secured party agrees that in the event of any
default by Franchisee and exercise of its right to take sell such assets under
any documents relating to such security interests, Franchisor shall have the
right and option to exercise a right of first refusal to purchase such assets on
the same terms and conditions offered by the secured party.  If,
within thirty (30) days after receipt of the offer, which would include
information and documentation as the Franchisor may need or require for the
purpose of considering whether to exercise its right of first refusal to
purchase such assets, the Franchisor does not indicate its acceptance of the
offer as stated in the notice, secured party shall thereafter have the right to
make the sale to the proposed transferee on the same terms and conditions as
stated in the notice.  Should the Franchisor not exercise its right of
first refusal and should the contemplated sale not be completed within one
hundred (120) days from the date of the notice, or should the terms and
conditions thereof (including the proposed transferee or the ownership therein)
be altered in any material way, this right of first refusal shall be reinstated
and any such subsequent proposed sale or altered terms and conditions of the
current transaction must again be offered to the Franchisor in accordance with
the terms listed above.


    23.13   
  Except for the express rights set forth at Section 21, nothing
contained in this Agreement, whether express or implied, shall be deemed in any
way to prevent or limit the Franchisor and its subsidiaries and affiliates from
opening and/or operating, or granting the right to any person to open and/or
operate, restaurants in the immediate vicinity of or adjacent to the
Restaurant.  Franchisee understands and agrees that the Franchisor or
its subsidiaries or affiliates, in their sole discretion, may open and/or
operate restaurants in any area they choose, or may authorize or license others
to do the same, whether it is in competition with or in any other way affects
the sales of Franchisee at the Restaurant.  Franchisee understands and
agrees that Franchisor also reserves the right to sell the same or similar
products (using the mailers or not) to customers at retail locations, through
the internet, telemarketing or other direct marketing, or through other
restaurants having the same or similar menu items.

    


    23.14      
This Agreement shall be binding upon and inure to the benefit of the parties
hereto, their permitted heirs, successors and assigns.

    


    23.15    
  This Agreement shall not be binding upon the Franchisor unless and
until it shall have been accepted and signed by authorized officers of the
Franchisor.

     

    
      
        
        

      

      
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    23.16     
 The parties intend to confer no benefit or right on any person or entity
not a party to this Agreement, and no third party shall have the right to claim
the benefit of any provision hereof as a third party beneficiary of any such
provision.

    


    23.17       a.          
If following commencement of business at the Restaurant the Restaurant is
damaged or destroyed to the extent that the Franchisor determines that the
Restaurant must be closed for repairs for more than sixty (60) days, or if the
Location is taken by condemnation proceedings or Franchisee's lease is
terminated through no act or failure to act on its part (except the failure to
utilize any available options to extend such lease, or Franchisee’s willful
truncation of such lease), Franchisee may elect to relocate the Restaurant,
terminate this Agreement, or in the case of a casualty, rebuild the
Restaurant.  Franchisee shall give notice of its intent to relocate,
rebuild or terminate not later than forty-five (45) days following the date such
casualty, condemnation or loss of lease occurs.  If Lessee fails to
give such written notification within such forty-five (45) day period,
Franchisee shall be deemed to have elected to terminate this Agreement, and such
termination shall be deemed effective within thirty (30) days following the date
of such casualty, condemnation or loss of lease.  In the event of such
termination, Franchisee shall promptly comply with the requirements set forth at
Sections 19.1 and 19.2.

    


    b.           If
Franchisee elects to rebuild, Franchisee shall, at its own expense, repair or
reconstruct the Restaurant, and such construction shall be completed and the
Restaurant shall reopen for business not later than twelve (12) months following
the date the casualty occurred.  The minimum acceptable appearance for
the reconstructed Restaurant will be that which existed just prior to the
casualty; however, every effort shall be made to have the reconstructed
Restaurant reflect the then current image, design and specifications of new El
Pollo Loco®
restaurants.


    c.           If
Franchisee elects to relocate the Restaurant, it must execute Franchisor’s
current form of Franchise Agreement within thirty (30) days following the
occurrence of the casualty or its loss of possession of the original Location;
provided, however, that the
term of such new agreement shall be equal to the remaining term of this
Agreement and Franchisee shall not be required to pay a new initial franchise
fee.  Franchisee will submit a replacement site for the new
Restaurant, in accordance with the time frames indicated in the then-current
form of Franchise Agreement, and shall be located in an area defined as a radius
surrounding the existing site of the Restaurant, the exact dimensions of which
shall be reasonably negotiated between Franchisee and the Franchisor taking into
consideration the rights of other existing and potential
franchisees.  If the Franchisor approves the new site, Franchisee
shall either acquire or lease the site and design, construct and furnish the
Restaurant in conformance with the design and construction requirements imposed
by the Franchisor for new El Pollo Loco®
restaurants.  The new Restaurant must be open for business not later
than twelve (12) months following the date of the casualty or loss of possession
of the original Location.

     

    
      
        
        

      

      
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    24.           INTERFERENCE WITH EMPLOYMENT
RELATIONS

    


    During the term of this Agreement,
neither the Franchisor nor Franchisee shall employ or seek to employ, directly
or indirectly any person who is at the time or was at any time during the prior
six (6) months employed in any type of managerial position by the other party,
or by any franchisee in the system, without the other's prior written
"Consent."  "Consent" for purposes of this provision shall mean that
at the time Franchisee or Franchisor employs or seeks to employ the person, the
former/current employer has given its written consent to the hiring employer to
extend an offer of employment to that person.  Any party who violates
this provision agrees to pay as fair and reasonable liquidated damages (but not
as a penalty) an amount equal to 2 times the annual compensation that the person
being hired away was receiving at the time the violating party offers him/her
employment.  The parties agree that this amount is for the damages
that the non-violating party will suffer for the loss of the person hired away
by the other party, including the costs of recruiting, hiring and training a new
employee and for the loss of the services and experience of the employee hired
away, and this it would be difficult to calculate with certainty the amount of
damage the non-violating party will incur.  Notwithstanding the
foregoing, if a court determines that this liquidated damages penalty in
unenforceable, then the non-violating party may pursue all other available
remedies available at law or in equity.   For purposes of this
provision, "managerial position" shall mean any restaurant managers, whether
exempt or non-exempt, who are shift leaders or above and any operations
supervisory personnel, including area leaders, district managers, directors of
operations, vice presidents of operation or equivalent operations
positions."

    


    25.           EFFECTIVE DATE

    


    25.1        
This Agreement shall be effective as of the date it is executed by the
Franchisor.

    


    26.           ACKNOWLEDGMENTS

    


    26.1         Franchisee
acknowledges that it has received a complete copy of the El Pollo Loco®
Disclosure Document, issuance date __________________ at least 14 calendar days
prior to the date on which this Agreement was executed by Franchisee or payment
of any monies to the Franchisor.


    26.2
Franchisee acknowledges that it has read and understands this Agreement, the
attachments thereto and the agreements relating thereto, if any, contained in
the Disclosure Document received by Franchisee on _________________, and that
the Franchisor has accorded Franchisee ample opportunity and has encouraged
Franchisee to consult with advisors of Franchisee's own choosing about the
potential benefits and risks of entering into this Agreement.

    


    27.           SIGNATURES

    


    IN
WITNESS WHEREOF, this Agreement has been executed by the parties hereto as of
the date first set forth above.

    


    
      
        	
                THE
      FRANCHISOR:

              	 
      	
                FRANCHISEE:

              
	
                EL
      POLLO LOCO, INC.,

              	 
      	 
      
	
                a
      Delaware Corporation

              	 
      	
                a_____________________________

              
	 
      	 
      	 
      
	
                By:

              	
                  

              	 
      	
                By:

              	
                  

              
	
                Its:

              	
                  

              	 
      	
                Its:

              	
                  

              
	
                Date:

              	
                  

              	 
      	
                Date:

              	
                  

              


      

    


    
      
         


      

      
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    EXHIBIT
1 TO FRANCHISE AGREEMENT

    


    PROCEDURES
FOR RESOLVING DISPUTES RELATING TO

    THE
DEVELOPMENT OF NEW RESTAURANTS

     

    

    


    PROCEDURES
FOR RESOLVING DISPUTES RELATING TO

    THE
DEVELOPMENT OF NEW RESTAURANTS

    


    (June
1996)

    


    Exhibit A
to Procedures for Resolving Disputes Relating to the Development of New
Restaurants

    
      
         


      

      
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    TABLE
OF CONTENTS

     

    
      
        	 
      	 
      	
                Page

              
	
                ARTICLE
      I - Statement of Purpose, Nature of Procedures

              	 
      	
                58

              
	
                SECTION
      1.1. Statement of Purpose

              	 
      	
                58

              
	
                SECTION
      1.2. Nature of Procedures

              	 
      	
                58

              
	 
      	 
      	 
      
	
                ARTICLE
      II – Definitions

              	 
      	
                58

              
	 
      	 
      	 
      
	
                ARTICLE
      III - Pre-Development Communication

              	 
      	
                60

              
	
                SECTION
      3.1. Procedures Prior to Development of New Restaurant

              	 
      	
                60

              
	
                SECTION
      3.2. New Restaurant Site in Jeopardy

              	 
      	
                62

              
	 
      	 
      	 
      
	
                ARTICLE
      IV - Financial Support during ADR Procedures

              	 
      	
                62

              
	
                SECTION
      4.1. Conditions Precedent

              	 
      	
                62

              
	
                SECTION
      4.2. Royalty Deferral

              	 
      	

                63

              
	
                SECTION
      4.3. Quarterly

              	 
      	
                63

              
	 
      	 
      	 
	
                ARTICLE
      V - Initiation of ADR Procedures

              	 
      	
                63

              
	
                SECTION
      5.1. Initiation of ADR Procedures

              	 
      	
                63

              
	
                SECTION
      5.2. Monitoring Period

              	 
      	
                64

              
	
                SECTION
      5.3. Withdrawal from ADR Procedures

              	 
      	
                64

              
	 
      	 
      	
                 

              
	
                ARTICLE
      VI - Negotiation/Mediation Procedures

              	 
      	
                64

              
	
                SECTION
      6.1. Pre-Mediation Negotiations

              	 
      	
                64

              
	
                SECTION
      6.2. Mediation Commencement

              	 
      	
                64

              
	
                SECTION
      6.3. Mediator Selection

              	 
      	
                64

              
	
                SECTION
      6.4. Mediation Meeting

              	 
      	
                65

              
	
                SECTION
      6.5. Privileges of the Mediator

              	 
      	
                65

              
	
                SECTION
      6.6. Information Requested by Mediator

              	 
      	
                65

              
	
                SECTION
      6.7. Settlement through Mediation

              	 
      	
                65

              
	
                SECTION
      6.8. Conclusion of Mediation

              	 
      	
                66

              
	 
      	 
      	 
      
	
                ARTICLE
      VII - Arbitration

              	 
      	
                66

              
	
                SECTION
      7.1. Initiating Arbitration

              	 
      	
                66

              
	
                SECTION
      7.2. Arbitrator Selection and Duties

              	 
      	
                66
      

              
	
                SECTION
      7.3. Disclosures

              	 
      	
                67

              
	
                SECTION
      7.4. Arbitration Session

              	 
      	
                67

              
	
                SECTION
      7.5. Management Negotiations

              	 
      	
                68

              
	
                SECTION
      7.6. Arbitration Award

              	 
      	
                68

              
	 
      	 
      	 
      
	
                ARTICLE
      VIII - General Matters Relating To Mediation and
    Arbitration

              	 
      	
                70

              
	
                SECTION
      8.1. Mediators and Arbitrators

              	 
      	
                70

              
	
                SECTION
      8.2. Fees and Expenses of Mediation and Arbitration

              	 
      	
                70

              
	
                SECTION 8.3.
      Confidentiality

              	 
      	
                71

              
	 
      	 
      	 
      
	
                ARTICLE
      IX - Miscellaneous

              	 
      	
                71

              
	
                SECTION
      9.1. Time

              	 
      	
                71

              
	
                SECTION
      9.2. Miscellaneous Matters

              	
                  

              	
                71

              


      

    

    


    Exhibit A
to Procedures for Resolving Disputes Relating to the Development of New
Restaurants

    
      
         


      

      
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    PROCEDURES
FOR RESOLVING DISPUTES

    RELATING
TO THE DEVELOPMENT OF NEW RESTAURANTS

    


    ARTICLE
I

    STATEMENT
OF PURPOSE; NATURE OF PROCEDURES

    


    SECTION 1.1. Statement of Purpose. Disputes
may arise between EPL and its franchisees concerning the development of new
restaurants near existing restaurants. The objectives of the alternative dispute
resolution procedures described in this document are first, to initiate open
communication between EPL and its franchisees in order to avoid disputes
concerning the development of new restaurants, and second, to resolve disputes
concerning the development of new restaurants without resorting to
litigation.

    


    SECTION 1.2. Nature of Procedures.
The alternative dispute resolution procedures described in this document
are private and consensual proceedings and constitute the sole and exclusive
rights and remedies for EPL franchisees with respect to New Restaurant Disputes
(as that term is defined below). Neither such alternative dispute resolution
procedures nor any notice request or other communication delivered in connection
with alternative dispute resolution procedures constitutes an admission of
encroachment.

    


    ARTICLE
II

    DEFINITIONS

    


    “ADR Deposit” means a
deposit in the amount of two thousand five hundred ($2,500) United States
Dollars.

    


    “ADR Procedures"
means, collectively, the alternative dispute resolution procedures described
herein, as they may be modified from time to time, including negotiation,
Mediation and the Arbitration Procedures.

    


    “Allowable Transfer
Factor” has the meaning specified in Section
7.6.2.

    


    "Arbitration
Agreement” means an agreement, substantially in the form of Exhibit
B, whereby all parties thereto agree to resolve the New Restaurant
Dispute through the ADR Procedures set forth in Article VI and VII.

    


    “Arbitration
Procedures” means the arbitration procedures described in Article
VII.

    


    “Arbitration
Proceedings” has the meaning specified in Section
7.1.

    


    “Arbitration Session”
means an informal arbitration session conducted by the Arbitrator.

    “Arbitrator” means an
arbitrator selected pursuant to, Section 7.2.1.

    


    "Designated
Representative" means an employee of EPL designated by EPL to participate
in the meetings required herein.

    


    "Developer” means
either EPL or a new or proposed franchisee that desires to develop a New
Restaurant at a Target Site.

    


    "Dispute Resolution
Entity” means JAMS or another third party dispute resolution organization
designated by EPL and consented to by Objecting Franchisee, which consent shall
not be unreasonably withheld, which is qualified to create a panel of mediators
and arbitrators.

    


    "EPL" means El Pollo,
Loco, Inc., a Delaware corporation.

    


    Exhibit A
to Procedures for Resolving Disputes Relating to the Development of New
Restaurants

    
    
Exhibit A to Procedures for Resolving Disputes Relating to
the Development of New Restaurants

    
      
         


      

      
        Page 58
of 124

        
          

        

      

      
         


      

    

    


    “Existing Site” means
the specific site approved by EPL for the operation of an Objecting Franchisee's
El Pollo Loco®
restaurant and which is described in a Franchise Agreement between the Objecting
Franchisee and EPL.

    


    “Gross Percentage” has
the meaning specified in Section
7.6.4.

    


    "Independent
Consultant" means one of several independent suppliers identified by EPL
who are experienced in analyzing demographics and predicting the transfer of
sales from an existing restaurant to a new restaurant.

    


    "JAMS" means
J.A.M.S./Endispute, a California corporation, organized to resolve business
disputes without resorting to litigation.

    


    “Mediation” means the
procedure of mediation described in Article
VI.

    


    "Mediation Meeting"
means an informal mediation session held before the Mediator pursuant to Section
6.4.

    


    "Mediator" means a
mediator selected pursuant to Section
6.3.

    


    "New Restaurant” means
a proposed restaurant to be developed at a Target Site.

    


    “New Restaurant
Dispute” means a dispute among any Objecting Franchisee, EPL and any
Developer concerning the development of a New Restaurant at a Target Site,
including any claims asserted by such Objecting Franchisee relating to
encroachment or an unreasonable impact on sales.

    


    "New Restaurant
Rights” means that right of an Objecting Franchisee to locate a Target
Site for a New Restaurant within the Target Area.

    


    “Notification Radius”
means, with respect to each Existing Site, the area within a successively larger
ring radiating from the location of such Existing Site which contains, by U.S.
Government Bureau of Census survey, a population of at least 50,000 people
determined as follows:

    


    (i) if a
ring with a radius of one mile radiating from the location of such Existing Site
contains a population of at least 50,000 people, then such one-mile ring,
and

    


    (ii) if a
ring with a radius of one mile radiating from the location of such Existing Site
contains a population of less than 50,000 people, then a ring with the radius
increased by successive one-eighth mile increments until such ring includes a
population of at least 50,000 people.

    


    "Notification Radius
Franchisees” means all EPL franchisees who own or lease an Existing Site
for which a Target Site falls within such franchise restaurant's Notification
Radius and who have entered into a Franchise Agreement with EPL for such
Existing Site which contains the ADR Procedures.

    


    “Objecting Franchisee”
means any Notification Radius Franchisee that submits an objection Notice
pursuant to Section
3.1.2.

    


    “Objection Notice”
means a notice submitted by a Notification Radius Franchisee to EPL of its
objection to the development of a New Restaurant on the grounds of "unreasonable
impact" and which conforms to the requirements set forth at Section
3.1.2.

    


    “Preliminary Meeting”
has the meaning specified in Section 3.1.2 (a).

    


     

    “Pre-Mediation
Negotiations” means good faith negotiations between EPL and an Objecting
Franchisee occurring prior to Mediation.

    
    
Exhibit A to Procedures for Resolving Disputes Relating to
the Development of New Restaurants

    
      
         


      

      
        Page 59
of 124

        
          

        

      

      
         


      

    

    


    "Reduced Profit " has
the meaning specified in Section
7.6.4.

    


    “Royalty Deferral”
means the conditional deferral of payment of EPL royalty fees (but not
advertising fees, such advertising fees to remain payable during such period of
conditional deferral) payable under the Franchise Agreement for the Objecting
Franchisee's restaurant pursuant to Section
4.2.

    


    "Study" means a trade
area study prepared by an Independent Consultant analyzing the impact, if any,
that a New Restaurant may have on an Objecting Franchisee.

    


    "Study Deposit" means
a deposit in the amount of five thousand ($5,000) United States
Dollars.

    


    "Target Area" means an
area with distinct geographic boundaries as agreed upon by EPL and Franchisee,
such boundaries to be no greater than a two mile radius.

    


    


    “Target Site” means a
specific site for the development of a New Restaurant.

    


    "Transferred Sales"
has the meaning specified in Section
7.6.4.

    


    “Year Factor” means a
factor selected by the Arbitrator which will not be (a) less than one (1) or (b)
greater than eight (8).

    


    
      ARTICLE
III

    

    PRE-DEVELOPMENT
COMMUNICATION

    


    SECTION
3.1.   Procedures Prior to Development of New
Restaurant.

    


    3.1.1       
When a Target Site for a New Restaurant is identified by EPL, EPL will notify
all Notification Radius Franchisees.

    


    3.1.2.       If
any Notification Radius Franchisee wishes to object to the New Restaurant on the
grounds of "unreasonable impact," it will submit to EPL an Objection Notice
within fifteen (15) days of its receipt of the notice given by EPL pursuant to
Section 3.1.1
above. The Objection Notice must be in writing and specifically identify the
Existing Site and state the reasons why the New Restaurant will unreasonably
impact the Objecting Franchisee's franchise restaurant at the Existing Site. The
Objection Notice must also include a summary report, in the form attached hereto
as Exhibit
A, which sets forth such information as the Objecting Franchisee believes
is relevant to EPL's decision on whether a New Restaurant should be developed at
a Target Site.  Notwithstanding the foregoing, a Notification Radius
Franchisee shall not be entitled to submit an Objection Notice or otherwise
proceed hereunder if such franchisee or its affiliate will own directly or
indirectly any interest in the New Restaurant or the entity owning the New
Restaurant. In addition, an Objecting Franchisee's rights hereunder shall
automatically terminate with respect to any franchise restaurant located within
a Notification Radius if the Franchise Agreement for such restaurant is
terminated by EPL or such Objecting Franchisee for any reason.

    


    
      	
              (a)

            	
              Within
      fifteen (15) days after receipt by EPL of an Objecting Franchisee's
      Objection Notice, such Objecting Franchisee and a
      representative of EPL will meet at the Objecting Franchisee's offices or
      at such other location as is mutually agreed upon by the Objecting
      Franchisee and EPL (the "Preliminary Meeting”). At such Preliminary
      Meeting the participants will review the objections of the Objecting
      Franchisee and attempt to resolve any New Restaurant
    Dispute.

            


    

    
    

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 60
of 124

        
          

        

      

      
         


      

    


    
      
        	
                (b)

              	
                (i)         If,
      at or after the Preliminary Meeting between EPL and the Objecting
      Franchisee, EPL elects to continue with the development of the New
      Restaurant, it shall give to the Objecting Franchisee following such
      Preliminary Meeting a written notification of its desire to proceed.
      Thereafter, the Objecting Franchisee may request a Study for each of its
      franchise restaurants located at Existing Sites within the Notification
      Radius and that the results of each such Study be considered by EPL prior
      to making a final decision with regard to the New Restaurant. The
      Objecting Franchisee will cooperate with all
      reasonable requests for information by EPL and the Independent Consultant
      in the preparation of each
Study.

              


      

    

    


    
      (ii)        
If
an Objecting Franchisee requests a Study, such Objecting Franchisee will bear
the cost of such Study subject to its right to a refund of such amounts or a
portion thereof pursuant to Section 3.1.2(b)(iv)
below. Such Objecting Franchisee will deposit with EPL, within five (5) business
days of its receipt of the notification from EPL described at Section 3.1.2 (b)(i)
above, a Study Deposit for each of such Objecting Franchisee's restaurants for
which a Study is requested to be held in escrow by EPL. EPL will, upon receipt
of the Study Deposit for an existing franchise restaurant of an Objecting
Franchisee, order a Study from the Independent Consultant for such franchise
restaurant. A copy of the results of such Study will be forwarded directly to
the Objecting Franchisee and EPL by the Independent Consultant. The failure by
the Objecting Franchisee to deposit with EPL   the Study Deposit
for any existing franchise restaurant of such Objecting Franchisee within the
allotted time frame will relieve EPL of any obligation to order the study for
such franchise restaurant or to delay its decision with regard to the New
Restaurant as provided below.

    

    


    (iii)        Upon
receipt of a Study Deposit from the Objecting Franchisee for an existing
franchise restaurant, EPL will delay announcing any final decision to proceed
with the New Restaurant until the fifth business day after the results of the
Study relating to such franchise restaurant have been submitted to EPL and the
Objecting Franchisee. During such five business day period, EPL and the
Objecting Franchisee will consider the results of the Study in determining
whether to continue developing the New Restaurant, in the case of EPL, or
pursuing its objection, in the case of the Objecting Franchisee.

    


    
      (iv)        If the
Study relating to an existing franchise restaurant of the Objecting Franchisee
projects a transfer of sales from the Objecting Franchisee's restaurant to the
New Restaurant of twelve (12%) percent or more, EPL will refund the Study
Deposit relating to such restaurant to the Objecting Franchisee and EPL will
bear the cost of such Study.  If such projected transfer of sales is
less than twelve percent (12%), such Study Deposit will be applied against the
cost of such Study, and either (A) any shortfall between such Study Deposit and
the actual cost of such Study will be paid by the Objecting Franchisee or (B)
any balance in such Study Deposit after payment of the cost of such Study will
be returned to the Objecting Franchisee.

    

    


    
      (v)        The
Objecting Franchisee and EPL agree that the results of any Study and the twelve
percent (12%) threshold specified in Section 3.1.2 (b)(iv) above
are not determinative of any matter other than for the determination of which
participant bears the cost of such Study and whether the objecting Franchisee
qualifies for Royalty Deferral and interim financial support as set forth in
Sections 4.2
and 4.3.2 below
and may not be used for any other purposes in connection with the New Restaurant
Dispute, including Mediation or the Arbitration Procedures.

    

    


    3.1.3.         
After consideration of the information obtained by and/or provided to EPL
concerning the New Restaurant and its projected impact, if any, on the Objecting
Franchisee's restaurant, including the Study, if applicable, and before EPL
approves a Target Site for development, EPL will notify in writing all Objecting
Franchisees and the Developer that EPL will either:

    


    
      
        	
              	
                (a)

              	
                not
      approve the Target Site; or

              


      

    

    


    
      	
            	
              (b)

            	
              grant
      to an Objecting Franchisee the New Restaurant Rights;
  or

            


    

    


    
      	
            	
              
                (c)

              

            	
              
                approve
      the development of a New Restaurant at the Target Site by
      the  Developer as
proposed.

              

            


    

    
    

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 61
of 124

        
          

        

      

      
         


      

    

    


    Notwithstanding
anything contained herein to the contrary, including the right of a Notification
Radius Franchisee to submit an Objection Notice, EPL at all times retains the
absolute and unilateral right to elect any of the options specified in Clause (a), (b) and (c) above, including,
specifically, the right to approve the development of a New
Restaurant.

    


    3.1.4                 If
EPL grants to an Objecting Franchisee the New Restaurant Rights, such Objecting
Franchisee will have fifteen (15) days after receipt of the notice given under
Section 3.1.3
to accept the New Restaurant Rights by executing and delivering to EPL an
Agreement identifying the Target Area for the New Restaurant and such other
terms as may reasonably be agreed upon by the parties. Such Objecting Franchisee
will have the right, but not the obligation, to accept the New Restaurant
Rights. If such Objecting Franchisee declines to accept the New Restaurant
Rights, such Objecting Franchisee will not be deemed to have waived any rights
to participate in the ADR Procedures.

    


    Following
the execution by Objecting Franchisee of a the Agreement referenced in Section
3.1.4 above, the Developer will be treated as a Notification Radius Franchisee
if it operates a restaurant at an Existing Site and has executed a Franchise
Agreement for that site containing the ADR Procedures meeting the criteria
specified in the definition thereof; however, while the Developer generally has
the right to participate in the ADR Procedures, it will not have the right to
call for a Preliminary Meeting.

    


    SECTION 3.2.  New
Restaurant Site in Jeopardy.

    


    3.2.1.              On
occasion, the Developer must commit to acquire a Target Site for a New
Restaurant prior to the results of the Study becoming available. In such cases,
the Target Site for such New Restaurant may be considered by EPL to be "in
jeopardy".

    


    3.2.2.              A
Target Site may be considered "in jeopardy" by EPL if, in its reasonable
judgment:

    


    
      	
              (a)

            	
              the
      Site for the New Restaurant identified by the Developer is available for
      development by others for uses other than as an El Pollo Loco®
      restaurant;

            


    

    


    
      	
              (b)

            	
              the
      Site for the New Restaurant identified by the Developer is likely to
      become unavailable for development as an El Pollo Loco®
      restaurant due to any delay caused by the preparation of the Study;
      or

            


    

    


    
      
        	
                (c)

              	
                there
      is not an economically comparable alternative site available within the
      geographic area surrounding the Target
Site.

              


      

    

    


    EPL may
also consider any other relevant information in making its
determination.

    


    3.2.3.              If
EPL determines that a Target Site is "in jeopardy", EPL may develop or permit
development of such site without waiting for the results of the Study. If EPL so
elects, each Objecting Franchisee who has satisfied the requirements at Section 4.1.1 and
Sections 4.1.3
through 4.1.5
below will be treated as if a Study had been conducted showing results in excess
of twelve (12%) percent, and such Objecting Franchisee will be entitled to (a)
Royalty Deferral, as defined in Section 4.2 below,
and (b) quarterly meetings together with, if applicable, financial support, as
described in Section
4.3 below.

    


    ARTICLE
IV

    FINANCIAL
SUPPORT DURING ADR PROCEDURES

    


    SECTION 4.1. Conditions Precedent.
  The provisions of Sections 4.2 and
4.3 will apply
with respect to an Objecting Franchisee if all of the following conditions are
met:

    


    4.1.1.              Such
Objecting Franchisee requests a Study and timely delivers the Study
Deposit.

    
    

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 62
of 124

        
          

        

      

      
         


      

    


    4.1.2.  The
Study projects a transfer of sales from such Objecting Franchisee's restaurant
to the New Restaurant of twelve (12%) percent or more of the Objecting
Franchisee’s sales or, if a Target Site is in jeopardy, EPL makes an election
pursuant to Section
3.2.3.

    


    4.1.3.                Such
Objecting Franchisee is not granted the New Restaurant Rights.

    


    4.1.4.                Such
Objecting Franchisee elects to pursue the ADR Procedures.

    


    4.1.5.                The
New Restaurant opens for business.

    


    SECTION 4.2.  Royalty
Deferral.  If each of the conditions listed
in    Section 4.1 above
have been
met  with respect to an Objecting Franchisee and if the Objecting
Franchisee requests in writing, then commencing on the tenth (10th) day of the
first  (1st) calendar month following the opening of the New
Restaurant, such Objecting Franchisee will be entitled to Royalty Deferral. The
Royalty Deferral will apply to the royalty fees payable in respect of any month
for which a decrease in sales, as compared to the same calendar month in the
preceding calendar year, has occurred and will remain in effect until the
conclusion of the ADR Procedures concerning the New Restaurant. The Royalty
Deferral will be discontinued if Franchisee does not comply with each of the
requirements of or otherwise discontinues its participation in the ADR
Procedures. The granting of such Royalty Deferral or the making of a loan
described in Section 4.3. below shall not be admissible as evidence or otherwise
brought before the Mediator or the Arbitrator in any mediation or arbitration
nor be deemed proof of an "unreasonable impact."

    


    SECTION 4.3. 
Quarterly Meetings.

    


    4.3.1.                As
a further condition to an objecting Franchisee's right to continue to receive
Royalty Deferral pursuant to Section 4.2, each
Objecting Franchisee and a Designated Representative will engage in quarterly
meetings. In addition, the Objecting Franchisee's right to continue to receive
such Royalty Deferral, at least five (5) business days prior to each such
meeting, such Objecting Franchisee will submit in writing to the Designated
Representative (i) an up-to-date profit and loss statement, balance sheet and
gross sales report for the trailing 12-month period and (ii) all other
information and data relevant to the operation, sales and/or profits of such
Objecting Franchisee's restaurant, including any sales promotion
activities.

    


    4.3.2.                If
it is determined by both the Objecting Franchisee and the Designated
Representative that additional financial support is necessary to enable the
Objecting Franchisee to generate additional net cash flow in the current year
from the operation of such Objecting Franchisee's restaurant, EPL will loan to
such Objecting Franchisee, with no interest, amounts to be determined by EPL to
be sufficient to assist such Objecting Franchisee to achieve such additional net
cash flow but not to exceed the net cash flow level obtained in the preceding
year for the comparable period. Such Objecting Franchisee will execute one or more
demand promissory notes, in the form of Exhibit
C, evidencing such loan amounts.

    


    4.3.3. 
If such Objecting Franchisee receives an award pursuant to Section 7.6.3 below
or if the participants reach an agreement as set forth in Section 6.1.1, 6.7.2 or 7.5.3 below, the
amount to be paid to such Objecting Franchisee pursuant to such Sections will be
decreased by (a) the aggregate amount deferred as Royalty Deferrals pursuant to
Section 4.2
above plus (b) the aggregate unpaid principal amount of all loans made pursuant
to Section
4.3.2 above.

    


    ARTICLE
V

    INITIATION
OF ADR PROCEDURES

    


    
      SECTION
5.1.  Initiation of ADR Procedures.

    

    


    5.1.1.                If
EPL elects to approve the New Restaurant, then any Objecting Franchisee, EPL and
the Developer shall proceed with premeditation negotiations and, if necessary,
mediation described in Article
VI.

    
    

    Exhibit A to Procedures for
Resolving Disputes Relating to the Development of New Restaurants

    
      
        
        

      

      
        Page 63
of 124

        
          

        

      

      
        
        

      

    

     

    5.1.2.                Upon
conclusion of mediation as set forth in Section 6.8.1, such
Objecting Franchisee may elect to proceed with the Arbitration Procedures. If
such Objecting Franchisee elects not to proceed under the Arbitration
Procedures, it shall withdraw from the ADR Procedures in the manner provided for
at Section 5.3.
If such Objecting Franchisee elects to proceed with the Arbitration Procedures,
such Objecting Franchisee, EPL, and the Developer (if other than EPL) shall sign
an Arbitration Agreement. At the time of signing the Arbitration Agreement by
such Objecting Franchisee, such Objecting Franchisee will deposit with EPL the
ADR Deposit to be held in escrow by EPL. The ADR Deposit will either be (a)
applied against the costs and expenses of the Arbitration Sessions, (b) returned
to such Objecting Franchisee pursuant to the Arbitrator's decision, or (c)
applied pursuant to the agreement of the participants. If such Objecting
Franchisee elects to withdraw from the ADR Procedures and release EPL as to the
claims relating to or arising out of the New Restaurant Dispute at any time
prior to the appointment of the Arbitrator, the ADR Deposit (less any sums
expended or committed to be expended by EPL in connection with the ADR
Procedures) will be returned to such Objecting Franchisee. The failure of such
Objecting Franchisee to execute the Arbitration Agreement or to deposit with EPL
the ADR Deposit in a timely manner will relieve EPL, at EPL's sole discretion,
of any obligation to resolve the New Restaurant Dispute through the ADR
Procedures and will be deemed a waiver by an Objecting Franchisee of its rights
hereunder.

    


    SECTION 5.2. Monitoring Period.
After the New Restaurant is opened for business, each of EPL and the
Objecting Franchisee, at its own cost, will independently monitor the
performance of such Objecting Franchisee's restaurant for a period not to exceed
twelve (12) months.

    


    SECTION 5.3  Withdrawal
from ADR Procedures.   An Objecting Franchisee may, at any
time, withdraw from the ADR Procedures upon delivery of a withdrawal notice to
EPL and upon such withdrawal, an Objecting Franchisee will be deemed to release
EPL as to the claims relating to or arising out of the New Restaurant
Dispute.

    


    ARTICLE
VI

    NEGOTIATION/MEDIATION
PROCEDURES

    


    SECTION 6.1.
Pre-Mediation Negotiations.

    


    6.1.1.                EPL
and the Objecting Franchisee will attempt, in good faith, to resolve any New
Restaurant Dispute by Pre-Mediation Negotiation.

    


    6.1.2.                If
the New Restaurant Dispute has not been resolved by negotiation prior to
commencement of Mediation as set forth below, the participants will submit the
New Restaurant Dispute to Mediation.

    


    SECTION 6.2.
Mediation Commencement.

    


    6.2.1. 
              Mediation
will be mandatory and non-binding.

    


    6.2.2.                If
the New Restaurant Dispute is resolved at the Preliminary Meeting, in the
Pre-mediation Negotiations or otherwise, Mediation will be unnecessary. If,
however, the New Restaurant Dispute remains unresolved, Mediation will commence
following the opening of the New Restaurant within the time period set forth at
Section
6.4.2.

    


    SECTION 6.3. Mediator
Selection.  Subject to the provisions relating to mediators in
Section 8.1, a
mediator will be selected by the participants not later than one hundred eighty
(180) days after the opening of the New Restaurant from a panel of three (3)
candidates selected by the Dispute Resolution Entity from the region where the
Target Site is located.  If the participants cannot agree on the
selection of a mediator from such panel, then the Dispute Resolution Entity will
select a mediator from its other panel members (but not from such panel of three
candidates) residing in the region where the Target Site is
located.

    
    

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 64
of 124

        
          

        

      

      
         


      

    


    


    SECTION 6.4.
Mediation Meeting.

    


    6.4.1.                A
Mediation Meeting will be held at a place and at a time agreeable to EPL, such
Objecting Franchisee and the Mediator. The Mediator will determine and control
the format and procedural aspects of the Mediation Meeting which will be
designed to ensure that both the Mediator and the participants have an
opportunity to hear an oral presentation of the other participants' views on the
New Restaurant Dispute. EPL and such Objecting Franchisee agree to cooperate in
all respects with the Mediator. The participants will attempt to resolve the New
Restaurant Dispute with the assistance of the Mediator.

    


    6.4.2.                The
Mediation Meeting will be conducted not less than sixty (60) days nor more than
one hundred twenty (120) days following the first anniversary of the opening of
the New Restaurant.

    


    6.4.3.                The
Mediator will be free to meet and communicate separately with each
participant.

    


    6.4.4.                In
the event that either participant requires a substantial amount of information
in the possession of the other participant in order to adequately prepare for
the Mediation Meeting, the participants will attempt, in good faith, to agree on
procedures for the expeditious exchange of such information. If the participants
fail to agree on such procedures, the Mediator will determine such procedures
and which documents and information will be exchanged.

    


    6.4.5.                Each
participant may be represented by one or more other persons, including its
counsel, one or more of its business persons, an accountant and a financial
consultant. At least one representative of each participant must have the
authority to negotiate a settlement of the New Restaurant Dispute.

    


    
      SECTION6.5.  Privileges
of the Mediator.

    

    


    6.5.1.                The
Mediator may freely express his views to the participants on the legal issues
unless a participant objects to his doing so.

    


    6.5.2.                The
Mediator may obtain assistance and independent expert advice with the agreement
of the participants and at the participants' expense.

    


    6.5.3.                The
Mediator will not be liable for any act or omission in connection with the role
of mediator, other than for his or her gross negligence or willful
misconduct.

    


    SECTION 6.6.
Information Requested by Mediator.

    


    6.6.1.                The
Mediator may request that the participants present, and each participant may
elect to submit, a written summary of the New Restaurant Dispute to the Mediator
with such additional information as the Mediator deems necessary to become
familiar with the New Restaurant Dispute.

    


    
      6.6.2      
The
Mediator may raise legal questions and arguments.

    

    


    
      SECTION6.7.  Settlement
through Mediation.

    

    


    6.7.1.                If
the participants have failed to reach an acceptable settlement prior to the end
of the Mediation Meeting, the Mediator, before concluding the Mediation Meeting,
may submit to the participants a settlement proposal based on the same
considerations to be used by an Arbitrator as set forth in Article VII which the Mediator deems
to be equitable to both participants. Each of the participants will, in good
faith, evaluate the proposal and discuss it with the Mediator. In the event that
a settlement is not reached, neither the terms of the proposed settlement nor
either party's refusal to agree thereto shall be admissible in the Arbitration
Proceedings nor brought before the Arbitrator in any way.

      

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 65
of 124

        
          

        

      

      
         


      

    

    


    6.7.2.                If
a settlement is reached, the Mediator, or one of the participants at the request
of the Mediator, will prepare a settlement agreement for execution by the
participants. Such settlement agreement will be edited as necessary by all
participants until it is mutually acceptable. When a mutually acceptable
settlement agreement is completed, each participant will execute and deliver
such settlement agreement.

    


    
      SECTION6.8.
Conclusion of Mediation.

    

    


    6.8.1.                The
participants will cooperate and continue to mediate until the Mediator
terminates the Mediation. The Mediator will terminate the Mediation upon the
earlier of (i) execution of a settlement agreement, (ii) a declaration by the
Mediator that the Mediation is terminated, or (iii) completion of a full day
Mediation Meeting unless extended by agreement of the participants.

    


    6.8.2.                If
an Objecting Franchisee has elected to proceed to arbitration, the participants
will proceed according to the Arbitration Procedures.  If an Objecting
Franchisee does not elect to proceed to arbitration, it shall withdraw from the
ADR Procedures in the manner provided for at Section
5.3.

    


    ARTICLE
VII

    ARBITRATION

    


    SECTION 7. 1.  Initiating
Arbitration.  The arbitration proceedings (the “Arbitration
Proceedings “) will be formally initiated by the execution of the
Arbitration Agreement as provided in Section 5.1.2. Such
Arbitration Agreement must be executed by the Objecting Franchisee and delivered
to EPL within 30 days following the conclusion of the Mediation. Each Objecting
Franchisee whose claim relates to the same Target Site is entitled to a separate
Arbitration Session although the Arbitrator for each Arbitration Session will be the
same.

    


    SECTION
7.2. Arbitrator Selection and Duties.

    


    7.2.1.                A
panel of three (3) arbitrator candidates from the general geographic area where
the Target Site is located will be submitted to the participants not later than
ten (10) days after the conclusion of the Mediation by the Dispute Resolution
Entity. An arbitrator will be selected by the participants from the panel not
later than thirty (30) business days after the execution of the Arbitration
Agreement. If the participants cannot agree on an arbitrator from such three
member panel, then the Dispute Resolution Entity will select the arbitrator from
its other panel members (but not from such panel of three candidates) residing
in the region where the Target Site is located. It the New Restaurant Dispute
includes more than one Objecting Franchisee and such Objecting Franchisees
cannot mutually agree on an arbitrator, each Objecting Franchisee will select
one arbitrator from the panel of three candidates and the Dispute Resolution
Entity will make a random selection from those arbitrator candidates selected by
the Objecting Franchisees as to which arbitrator candidate will serve as such
Objecting Franchisee's selection.

    


    7.2.2.                The
Arbitrator will assume the duties and functions described in this Article VII and
perform them in accordance with the procedures set forth herein. The Arbitrator
will also perform any additional duties and functions on which the participants
and the Arbitrator hereafter agree. The Arbitrator will execute an Arbitrator
Retention Agreement, substantially the form of Exhibit
D.

    


    7.2.3.                Except
as specifically provided for in this Article VII or as
agreed upon by the participants, no participant, nor anyone acting on its
behalf, will separately communicate with the Arbitrator on any matter of
substance.


    7.2.4.                The
Arbitrator will promptly notify the participants to the Arbitration Agreement
and the Dispute Resolution Entity of his/her unavailability to conduct the
Arbitration Session, in which case a replacement Arbitrator will be selected by
the participants. If the participants cannot agree on a replacement Arbitrator
within the time specified by the Dispute Resolution Entity, then the Dispute
Resolution Entity will select the replacement Arbitrator from its other members
(but not from the original panel of three candidates) residing in the region
where the Target Site is located.

      

    Exhibit
A to Procedures for Resolving Disputes Relating to the Development of New
Restaurants

    
      
        
        

      

      
        Page 66
of 124

        
          

        

      

      
        
        

      

    

    
       

      SECTION
7.3.  Disclosures.

    

    


    7.3.1.                Not
later than forty-five (45) days after the objecting Franchisee's execution and
delivery of the Arbitration Agreement, each participant will send a summary of
its position to the Arbitrator for the purpose of familiarizing the Arbitrator
with the facts and issues in the New Restaurant Dispute with a copy being
provided simultaneously to the other participants. The participants will comply
promptly with any requests by the Arbitrator for additional documents or
information relevant to the New Restaurant Dispute.

    


    7.3.2.                The
participants will attempt, in good faith, to agree on a plan for reasonably
necessary, expeditious discovery, including the deposition of any expert or
other witness of any other participant. If they fail to agree, any participant
may request a joint meeting (by telephone) with the Arbitrator, who will assist
the participants in agreeing on a discovery plan. In the absence of an agreement
by the participants, a discovery plan will be implemented by the
Arbitrator.

    


    7.3.3.                Before
the Arbitration Session, at a time mutually agreed upon by the participants but
not later than thirty (30) days prior to the date set for the Arbitration
Session, all participants will exchange, and submit to the Arbitrator, all
documents and exhibits on which the participants intend to rely during the
Arbitration Session. In addition, the participants will exchange, and submit to
the Arbitrator, a brief that will include the following: (a) a summary of all
expert witness opinions to be expressed and the basis for such opinions,
including the data or other information relied upon in forming such opinions;
(b) the qualifications of any expert witness, including education and employment
history and a listing of other matters in which the expert witness has testified
as an expert; and (c) a summary of the statements to be made by such participant
during the Arbitration Session. The brief will not exceed fifteen (15) pages,
single-spaced or thirty (30) pages, double-spaced.

    


    7.3.4.                Each
participant is under a duty to reasonably supplement or correct its
disclosures and submissions if such participant obtains information on the basis
of which it knows that the information previously disclosed was either
incomplete or incorrect when made or is no longer complete or true. The
Arbitrator will, upon request of an aggrieved participant, grant such
appropriate non-monetary relief to assure that these disclosure procedures are
followed and that adequate pre-Arbitration Session disclosure and submissions
are made as required by Section 7.3.2 and
7.3.3.

    


    
      SECTION
7.4. Arbitration Session.

    

    


    7.4.1.                Not
later than forty-five (45) days after execution of the Arbitration Agreement,
the participants and the Arbitrator will establish the date, which will not be
later than ninety (90) days after execution of the Arbitration Agreement, and
time of the Arbitration Session during which each participant will make an oral
presentation to the Arbitrator concerning the New Restaurant Dispute. The
Arbitration Session will be held before the Arbitrator at such location as is
agreed to by the participants, or failing such agreement on such location, as
specified by the Arbitrator.

    


    7.4.2.                During
the Arbitration Session, each participant will make an oral presentation of its
case and each other participant will be entitled to a rebuttal.

    


    7.4.3.                The
order of oral presentations and rebuttals will be determined by agreement
between the participants, or failing such agreement, by the Arbitrator. in order
to allow each participant reasonable opportunity to present his position, but
with the express objective of reasonable brevity in mind, unless otherwise
agreed to by the participants: (a) each participant's oral presentation will not
exceed two (2) hours, (b) each participant will have no more than one (1) hour
within which to question the other participant and its witnesses, and (c) each
participant's rebuttal will not exceed one (1) hour. As long as each participant
is treated equally, the Arbitrator may extend or shorten such time periods,
provided that the Arbitration Session will not exceed two (2) full days unless
otherwise agreed to by the participants. The oral presentation, questioning of
participants and their witnesses and rebuttal
of any participant will not be interrupted by any other participant except the
Arbitrator.

    
    

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 67
of 124

        
          

        

      

      
         


      

    

    


    7.4.4.                The
Arbitrator will conduct and moderate the Arbitration Session. The oral
presentations and rebuttals of each participant may be made in any form, and by
any individual, as desired by such participant. Presentations by fact witnesses
and expert witnesses will be permitted. No rules of evidence, including rules of
relevance, will apply at the Arbitration Session, except that no witness or
participant will be required to disclose privileged communications or the advice
and/or work product of an attorney. Witnesses will be required to testify under
oath or affirmance.

    


    7.4.5.                Following
each oral presentation by a participant, the Arbitrator may ask questions of
such participant, its counsel or any other persons appearing on its behalf.
Following the Arbitrator having the opportunity to ask questions, any other
participant or its representatives, including counsel, may ask questions of such
participant, its counsel and any other persons appearing on its
behalf.

    


    7.4.6.                 Each
participant will be represented by at least one (1) member of its management at
the Arbitration Session who has authority to settle the Dispute. In addition to
legal counsel, each participant may have other advisors in attendance at the
Arbitration Session, provided that notice is given to all participants and the
Arbitrator of the identity of such advisors at
least five (5) days before commencement of the Arbitration Session.

    


    
      SECTION   
  7.5. Management Negotiations.

    

    


    7.5.1.                At
the conclusion of the rebuttals, the management representatives of each
participant will meet one or more times to try to agree on a resolution of the
New Restaurant Dispute.

    


    7.5.2.                The
Arbitrator will control these negotiations.  At the discretion of the
Arbitrator and with the agreement of the participants, negotiations may proceed
in the absence of counsel.

    


    7.5.3.                If
a settlement is reached, the Arbitrator, or one of the participants at the
request of the Arbitrator, will prepare a settlement
agreement for execution by the participants. Such settlement agreement will be
edited as necessary by all participants until it is mutually
acceptable.  When a mutually acceptable settlement agreement is
completed, each participant will execute and deliver such settlement agreement.
Upon the execution and delivery of a settlement agreement, such settlement
agreement will be legally binding on the participants and specifically
enforceable by any court of competent jurisdiction.

    


    
      SECTION     
7.6.  Arbitration Award.

    

    


    7.6.1.                If
the participants do not resolve the New Restaurant Dispute as a result of the
negotiations between management representatives as facilitated by the
Arbitrator, then the Arbitrator will declare an impasse and render a decision or
an award as provided below. The declaring of an impasse is within the sole
discretion of the Arbitrator. The decision or award of the Arbitrator will be in
writing, dated and signed by the Arbitrator and will identify the prevailing
participant and the amount of the award, if any, due to the Objecting
Franchisee. The Arbitrator will deliver a copy of the decision or award to each
participant either personally or by registered or certified mail not later than
thirty (30) days after the conclusion of the Arbitration Session.

    


    7.6.2.                In
rendering its decision or award, the Arbitrator will consider evidence from the
participants as to what percentage decrease, if any, in the annual gross sales
and profits of the Objecting Franchisee's restaurant was reasonable under the
circumstances (the “Allowable Transfer
Factor”).  The participants may agree on an Allowable Transfer
Factor to be applied by the Arbitrator in determining an award, if any,
below.

    


    7.6.3.                The
decision or award of the Arbitrator will be one of the following:

      

    Exhibit A to Procedures for
Resolving Disputes Relating to the Development of New Restaurants

    
      
        
        

      

      
        Page 68
of 124

        
          

        

      

      
        
        

      

    

     

    
      
        	
                (a)

              	
                A
      decision that the New Restaurant has not directly or proximately caused a
      reduction in the annual gross sales of the Objecting Franchisee's
      restaurant; or

              


      

    

    


    
      	
              (b)

            	
              A
      decision that no compensation is due an Objecting Franchisee based on a
      finding that the Objecting Franchisee has failed to prove that the New
      Restaurant has directly or proximately caused a reduction in the annual
      gross sales of the Objecting Franchisee's restaurant in an amount in
      excess of the Allowable Transfer Factor, if any;
  or

            


    

    


    
      	
              (c)

            	
              A
      decision that compensation is due the Objecting Franchisee based on a
      finding that the Objecting Franchisee has proven that the New Restaurant
      has directly or proximately caused a percentage reduction in the gross
      sales of the Objecting Franchisee's restaurant in excess of the Allowable
      Transfer Factor, if any.

            


    

    


    7.6.4.             If
compensation is due the Objecting Franchisee pursuant to Section 7.6.3(c),
such compensation will be calculated in the following manner:

    


    
      	
              STEP
      1:

            	
              The
      Arbitrator makes a finding that the New Restaurant directly or proximately
      caused a decrease in the gross sales of the Objecting Franchisee's
      restaurant by a certain percentage. Such percentage will relate to
      operations for the first 12-month period following the opening of the New
      Restaurant.

            


    

    


    
      	
              STEP
      2:

            	
              The
      Arbitrator will subtract the Allowable Transfer Factor, if any, from
      thepercentage
      determined by the Arbitrator in Step
      1  (the “Gross
      Percentage”).

            


    

    


    
      	
              STEP
      3:

            	
              The
      Arbitrator will multiply the "gross sales" of the Objecting Franchisee's
      restaurant for the 12-month period immediately preceding the opening of
      the New Restaurant by the Gross Percentage calculated in Step 2 (the
      "Transferred
      Sales").

            


    

    


    
      	
              STEP
      4:

            	
              The
      Arbitrator will multiply the Transferred Sales calculated in Step 3 by
      twenty-eight percent (28%) (the "Reduced
      Profit").

            


    

    


    
      	
              STEP
      5:

            	
              The
      Arbitrator will multiply the Reduced Profit calculated in Step 4 by the
      Year Factor.

            


    

    


    7.6.5.             The
award calculated pursuant to Section 7.6.4 will be
paid to the Objecting Franchisee as follows:

    


    
      	
              (a)

            	
              In
      those instances where the Arbitrator selects a Year Factor equal to one
      (1), the award will be paid by EPL to the Objecting Franchisee within ten
      (10) business days following the date of the Arbitrator's
      award.

            


    

    


    
      
        	
                (b)

              	
                In
      those instances where the Arbitrator selects a Year Factor that is greater
      than one (1), EPL may elect to pay the award to the Objecting Franchisee
      within the time period set forth in Section
      7.6.5(a) above or in installments, each installment equal to the
      amount of the award divided by the Year Factor, the Year Factor to
      represent the number of years over which such award is to be
      paid.  The first installment of the award will be paid within
      ten (10) business days following the date of the Arbitrator’s
      award.  Each subsequent installment will be paid annually within
      ten (10) business days of the anniversary of the date of the Arbitrator’s
      award.  If EPL elects to pay the award in installments as
      provided for in this Section
      7.6.5(b), EPL shall deliver to Objecting Franchisee a promissory
      note in the form of Exhibit
      E.  The outstanding balance of such promissory note shall
      bear interest at an interest rate equal to the prime rate published in the
      Wall Street
      Journal on the date the award is
granted.

              


      

    

    


    7.6.6.             The
Arbitrator will provide an explanation for the decision or award and will file
the same with EPL. Copies of such decisions or awards will be provided to all
franchisees upon reasonable request.

    
    

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 69
of 124

        
          

        

      

      
         


      

    

    


    7.6.7.                Subject
only to the provisions of Section 9 of the
Federal Arbitration Act specifying the standards for challenging the decision or
award of an arbitrator, the decision or award of the Arbitrator will be binding.
The decision or award of the Arbitrator will be confirmed and enforced as an
arbitration award in accordance with the law of the appropriate court of
competent jurisdiction.

    


    7.6.8.                Unless
otherwise agreed to by each of the participants to the ADR Procedures, if the
Developer is not EPL, the Developer will not be liable directly to an Objecting
Franchisee for any compensation due to an Objecting Franchisee.

    


    7.6.9.                In
determining the Gross Percentage Factor and the Year Factor, and in carrying out
its analysis as to whether there has been an unreasonable impact resulting from
the New Restaurant, the Arbitrator will consider, among other things, the
factors, examples and analyses described in Exhibit
6. The parties understand and acknowledge that such factors, examples and
analyses are not exclusive and are incorporated to assist the Arbitrator in its
determination of the type of factors to be used in establishing the Gross
Percentage and the Year Factor.

    


    ARTICLE
VIII

    GENERAL
MATTERS RELATING TO MEDIATION AND ARBITRATION

    


    
      SECTION    
8.1. Mediators and Arbitrators.

    

    


    8.1.1.             A
panel of mediators and arbitrators will be created by the Dispute Resolution
Entity.

    


    Unless
otherwise agreed to by the participants to the Mediation or Arbitration
Proceedings, no person selected as a mediator or arbitrator will:

    


    
      	
              (a)

            	
              have
      been an EPL franchisee or a franchisee of any other franchise
      system;

            


    

    


    
      
        	
                (b)

              	
                have
      been an officer, director or employee of EPL, any EPL franchisee, the
      Developer, the Objecting Franchisee, the franchisee or the franchisor or
      another franchise system or of any affiliate of the foregoing;
      or

              


      

    

    


    
      
        
          	
                  (c)

                	
                  have
      performed significant professional services for EPL or for one or more
      EPL
      franchisees or any such franchisee's
affiliates.

                


        

      

    

    


    8.1.2.             If
mutually agreeable to the participants, the Arbitrator may be the same
individual as the Mediator.

    


    SECTION
8.2. Fees and Expenses of Mediation and Arbitration.

    


    8.2.1.             The
Mediator's and Arbitrator’s fees and other charges will be established at the
time of selection.

    


    8.2.2.             Unless
the participants otherwise agree, or except as provided in the following
sentences, fees and expenses of the Mediator and any other expenses of Mediation
will be shared equally by the participants. Each participant will bear its own
costs, expenses and attorneys' fees in preparing for and participating in
Mediation. If a Study is conducted that projects that twelve (12%) percent or
more of sales will transfer to the New Restaurant from an Objecting Franchisee's
restaurant, and EPL elects to approve the development of the New Restaurant, EPL
will pay all fees and charges of the Mediator and any other expenses of
conducting the Mediation, excluding, however, such Objecting Franchisee's
expenses and attorneys' fees.

    
    

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 70
of 124

        
          

        

      

      
         


      

    

    


    8.2.3.                Unless
the participants otherwise agree, or except as provided in the following
sentences, fees and expenses of the Arbitrator and any other expenses of the
Arbitration Proceedings will be shared equally by the participants. Each
participant will bear its own costs, expenses and attorneys' fees in preparing
for and participating in the Arbitration. Notwithstanding the foregoing, the
Arbitrator may, at the Arbitrator's discretion, order the participant deemed by
the Arbitrator to be the non-prevailing party to pay all (or a portion of) the
costs, attorneys' fees and expenses incurred by the prevailing party in
connection with the Arbitration Proceedings.

    


    
      SECTION8.3.
Confidentiality.

    

    


    8.3.1.                The
entire Mediation and Arbitration Proceeding will be considered settlement
negotiations. Except as otherwise provided in Section 8.3.3 below,
all offers, promises, conduct and statements, whether oral or written, made in
the course of the Mediation or Arbitration Proceedings by the participants,
their agents, employees, experts and attorneys, and by the Mediator or
Arbitrator, will be and remain confidential. Such offers, promises, conduct and
statements are privileged under any applicable mediation privilege, and will be
inadmissible and not discoverable for any purpose, or in any other dispute
between the parties or between one of the parties and any other person, including
impeachment.

    


    8.3.2.              
 Each of the Mediator and Arbitrator will be disqualified as a witness,
consultant, or expert for any participant, and in rendering a decision or award
as is hereinafter provided, the Arbitrator’s oral and written opinions will be
inadmissible for all purposes in this or any other dispute involving the
participants or any other person.

    


    8.3.3.                Notwithstanding
the provisions of Section 8.3.1 and
8.3.2, these
ADR Procedures will not be deemed to preclude the disclosure of the terms of any
settlement arrived at through Mediation, or the decision or award of the
Arbitrator rendered as a result of the Arbitration Session.

    


    ARTICLE
IX

    MISCELLANEOUS

    


    SECTION 9.1.
Time.   Unless otherwise provided in the ADR Procedures,
the time periods provided in the ADR Procedures may be shortened or extended
only by mutual written agreement of the participants.

    


    
      SECTION       
9.2. Miscellaneous Matters.

    

    


    9.2.1.                These
ADR Procedures will become effective on the date set forth on the cover page to
these procedures.

    


    9.2.2.                These
ADR Procedures do not amend any franchise or other agreement to which EPL is a
participant, except to the extent that they are incorporated by specific
reference into a Franchise Agreement. These ADR Procedures may only be modified
in the manner described in such Franchise Agreement. These ADR Procedures will
not create any third party beneficiary rights. These ADR Procedures represent
the sole procedure and remedy for an Objecting Franchisee with respect to any
matter relating to a New Restaurant Dispute.

    


    9.2.3.                A
franchisee that has submitted an Objection Notice will not be denied expansion
approval solely because of its objection provided that such franchisee is
otherwise fully approved to expand to new EPL locations and such franchisee has
formally entered into and remains in compliance with the ADR Procedures,
including execution of an Arbitration Agreement and depositing the ADR Deposit
with EPL.

    


    9.2.4.                These
ADR procedures will be governed by and construed in accordance with the laws of
the State of California and the Federal Arbitration Act. All notifications and
communications required under these ADR procedures shall be in writing and be
given pursuant to the notification requirements set forth in the Objecting
Franchisee's Franchise Agreement.

       

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 71
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
“A”

    TO
PROCEDURES FOR RESOLVING DISPUTES

    RELATING
TO THE DEVELOPMENT OF NEW RESTAURANTS

    


    SUMMARY
REPORT TO OBJECTION NOTICE

    


    General
Instructions

    


    A.           Complete
a separate form for each existing El Pollo Loco®
restaurant (an "Existing Restaurant")
within the Notification Radius you believe may be unreasonably encroached upon
and impacted by the proposed new restaurant site (the "Target Site"). "Notification Radius"
has the meaning specified in Article II of the
Procedures for Resolving Disputes Relating to the Development of New Restaurants
promulgated by EPL.

    


    B.           Attach
a street map of the area surrounding the Existing Restaurant and the proposed
Target Site (scale of the map should be approximately 1-10 mile or
larger).

    


    Specific
Information

    


    A.           Answer
each of the following questions. Answers must be specific and not contain any
general or conclusory statements.

    


    
      	
              1.

            	
              EXISTING
      RESTAURANT

            


    

    


    El Pollo
Loco #_________

    Cross
Streets _________________ and ____________________________

    Address
_____________________________________________________

    


    
      	
              2.

            	
              PROPOSED
      SITE

            


    

    


    Cross
Streets _________________ and ____________________________

    Address
_____________________________________________________

    


    
      	
              3.

            	
              Shortest
      driving distance and travel time between Existing Restaurant and proposed
      Target Site

            


    

    


    Distance  ________________________________________________________

    


    
      	
              Time
      of Day ______________

            	 
      	
              Minutes
      __________

            	 
      	
              Breakfast

            
	
              Time
      of Day ______________

            	 
      	
              Minutes
      __________

            	 
      	
              Lunch

            
	
              Time
      of Day ______________

            	
                

            	
              Minutes
      __________

            	
                

            	
              Dinner

            


    

    


    Describe
roads driven to obtain above distance and time

    ________________________________________________________________

    


    Shortest
distance between Existing Restaurant and proposed Target Site "as the crow
flies" (straight line)

    


    Distance
______________________________

    


    
      
        	
                4.

              	
                From
      what geographic area do you think the Existing Restaurant currently is
      drawing customers? Define the trade area and be specific - include street
      names, radius, distance and traffic generators (i.e., a mall or
      schools).

              
	 	 


      

    

          

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 72
of 124

        
          

        

      

      
         


      

    

     

    
      
        	
                5.

              	
                What
      areas described in #4 do you think the proposed Target Site's trade area
      will encroach upon? Be specific.

              
	 	 


      

    

    
      
      

    

    


    
      
        
          
            
              	
                      6.

                    	
                      In
      your opinion, what is the trade area of the proposed Target Site? Be
      specific - include street names, radius, distance and traffic
      generators.  

                    
	 	 


            

          

        

      

    

    
      
      

    

    


    
      
        	
                7.

              	
                Which
      traffic arteries provide the main flow of traffic to the Existing
      Restaurant? Include street names and directional flow.

              
	 	 


      

    

    
      
      

    

    


    
      
        	
                8.

              	
                Which
      main arteries do you think will be providing traffic flow to the
      proposed Target Site? Include street names and directional
      flow.

              
	 	 


      

    

    
      
      

    

    


    
      
        	
                9.

              	
                Are
      there any natural or man made barriers which separate the Existing
      Restaurant from the proposed Target Site? If yes, please
      describe.

              
	 	 


      

    

    
      
      

    

    


    
      
        	
                10.

              	
                How
      would you
      rate the physical appearance of the Existing Restaurant compared to a new
      El Pollo Loco®
      restaurant? Better than, equal to, or not as good as a new facility
      (choose one). Give reasons for your opinion.

              
	 	 


      

    

    
      
      

    

    


    
      
        	
                11.

              	
                What
      is the date of the last remodel at the Existing Restaurant and what was
      the scope of work? Be specific.

              
	 	 


      

    

    
      
      

    

    


    
      
        	
                12.

              	
                Does
      the franchisee currently have any plans to upgrade the Existing
      Restaurant? If so, what are the proposed upgrades? Be specific, include
      scope of work and dates.

              
	 	 


      

    

    
      
      

    

    


    
      
        	
                13.

              	
                What
      percentage of the Existing Restaurant's sales do you think the proposed Target
      Site will capture if it is built?

              
	 	 


      

    

    
      
      

    

    


    
      
        	
                14.

              	
                Would
      lunch or dinner be most affected? Why?

              
	 	 


      

    

    
      
      

    

    


    
      
        	
                15.

              	
                What
      marketing activities have taken place at the Existing Restaurant in the
      past six months other than national promotions? Please be specific. How
      successful were they?

              


      

    

    
      
        	
                 
      

              	
                 
      

              


      

    

    


    
      
        	
                16.

              	
                Do
      you believe the market can support an El Pollo Loco®
      restaurant at the proposed
      Target Site if it is owned by the operator of the Existing Restaurant? If
      so, please explain your reasons.

              
	 	 


      

    

    


    BY:
___________________________          DATE:
_____________, 200_

       

    Exhibit A to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 73
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
“B”

    TO
PROCEDURES FOR RESOLVING DISPUTES

    RELATING
TO THE DEVELOPMENT OF NEW RESTAURANTS

    


    ARBITRATION
AGREEMENT

    


    For
valuable considerations, the receipt of which each party to this agreement
acknowledges, the undersigned agree to resolve the following described dispute
by using the Procedures for Resolving Disputes Relating to the Development of
New Restaurants (the "ADR Procedure") promulgated by El Pollo Loco,
Inc.

    


    Nature of
Dispute:

    


    The
parties agree to forego the filing of any lawsuit or legal action relating to
the dispute and agree to be bound by the decision or award of the Dispute
Resolution Entity (as defined in the ADR Procedures) under the ADR
Procedures.

    


    The rules
and provisions of the ADR Procedures are incorporated herein by reference and
the parties agree to be bound by same.

    


    DATED
this _________________ day of ____________,200_

    


    
      
        	
                EL
      POLLO LOCO, INC.

              
	 
      
	
                BY:

              	
                  

              
	 
      
	
                [OBJECTING
      FRANCHISEE]

              
	 
      
	
                BY:

              	
                  

              


      

    

    


    Exhibit B
to Procedures for Resolving Disputes Relating to the Development of New
Restaurants

    
      
         


      

      
        Page 74
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
“C”

    TO
PROCEDURES FOR RESOLVING DISPUTES

    RELATING
TO THE DEVELOPMENT OF NEW RESTAURANTS

    


    DEMAND
PROMISSORY NOTE

     

    
      
        	
                $
      ________________

              	
                ________________

              


      

    

    


    FOR VALUE
RECEIVED, we, the undersigned (“Makers”) jointly and
severally, promise to pay to the order of EL POLLO LOCO, INC. (“EPL”), a Delaware
corporation, [INSERT ADDRESS], ON DEMAND, the principal sum of
________________Dollars ($_________).   Until demand for payment
is made, this Note shall not accrue interest. Terms not  otherwise
defined in this Note shall have the meanings specified in the Procedures for
Resolving Disputes Relating to the Development of New Restaurants (the "ADR Procedures”) promulgated by
EPL.

    


    The
Makers hereby waive presentment, notice, protest and all other notices
required or
permitted hereunder and by law in connection with
the delivery,
acceptance, performance, default or enforcement of this Note, and assent to any
extension or postponement of the time of payment or of any other indulgence,
substitution, exchange or release of collateral, and/or to the addition or
release of any other party or person primarily or secondarily liable on this
Note.

    


    This Note
is being given to evidence the loan by EPL to the Objecting Franchisee pursuant
to the ADR Procedures, the terms of which are expressly made a part of this
instrument. The Makers hereof acknowledge that payment may be demanded by EPL
upon the earlier to occur of: (i) settlement of the New Restaurant Dispute
through Mediation or otherwise, (ii) conclusion of the Arbitration Proceedings,
or (iii) any default by the Makers of the terms of any Franchise Agreement, or
the occurrence of an event of default by which there is a violation of the terms
and covenants of any other contractual obligation by the Makers hereof to EPL.
The terms, covenants and conditions of agreements between the Makers and EPL are
expressly made a part of this instrument.

    


    This Note
is payable by mail or in person at the office of EPL or such other place as EPL
may designate.

    


    In the
event of delinquency in the payment of any principal or interest due on this
Note or in the event of any other default under this Note it becomes necessary
to retain an attorney for collection or to enforce the terms and conditions
hereof, the Makers agree to pay reasonable attorneys' fees, whether suit is
brought or not.

    


    The
enforceability of the terms of this Note and the legality of the interest rate
specified herein shall be interpreted in accordance with and governed by the
laws of the State of California. In the event of litigation involving this Note,
Makers agree that this Note shall be construed in accordance with California law
or the law of any other jurisdiction which has any relationship to the
transaction and under whose laws this Note would be enforceable.

    


    In the
event payment in full is not made within thirty (30) days of demand, interest on
the unpaid balance shall accrue at the maximum rate allowed by California law,
or if no maximum rate relating to this Note is in effect in the State of
California, ten (10%) percent per annum.

    


    During
the term of this Note, and upon ten (10) days' written request by EPL or any
other holder of this Note, each Maker agrees to give EPL or such holder adequate
assurances as to such Maker's ability to comply with the terms of this Note. Such
assurances shall include, but not be limited to, such Maker's then current
financial statement, which EPL or such holder may require be certified by a
Certified Public Accountant. Each Maker agrees that EPL or such holder may
disclose such financial statements, or any other financial information
pertaining to such Maker which EPL or such holder may
possess, to any potential buyer, assignee or holder in due course of this
Note.

    


    Exhibit C
to Procedures for Resolving Disputes Relating to the Development of New
Restaurants

    
      
         


      

      
        Page 75
of 124

        
          

        

      

      
         


      

    

    


    This Note
is personal to the Makers and is not assignable. In the event any Maker sells,
assigns or transfers its interest in the Franchise Agreement for El Pollo
Loco®
restaurant #_______, the entire principal amount then outstanding on this Note
shall immediately become due and payable. This Note is assignable by
EPL.

    


    The
Makers acknowledge that a default under the terms of this Note shall constitute
a default under the terms of the Franchise Agreement between Makers and EPL for
Restaurant #______.

    


    
      
        	
                [OBJECTING
      FRANCHISEE]

              
	 
      
	
                BY:

              	
                  

              
	 
      
	
                [MAKER]

              
	 
      
	
                BY:

              	
                  

              


      

    

        

    Exhibit C to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 76
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
“D”

    TO
PROCEDURES FOR RESOLVING DISPUTES

    RELATING
TO THE DEVELOPMENT OF NEW RESTAURANTS

    


    ARBITRATOR
RETENTION AGREEMENT

    


         This
Arbitrator Retention Agreement is made this _____ day of __________,
200_.

    


         A
dispute involving the development of a new restaurant by El Pollo Loco, Inc. has
arisen between El Pollo Loco, Inc. ("EPL") and ________________________________
(“Objecting Franchisee”). EPL and Objecting Franchisee have agreed to
participate in an alternative dispute resolution procedure pursuant to the
"Procedures For Resolving Disputes Relating to the Development of New
Restaurants,” (the "ADR Procedures") a
copy of which is annexed hereto. ______________________ ("Arbitrator") has been
chosen as a neutral arbitrator for the alternative dispute resolution
procedures. EPL, Objecting Franchisee and the Arbitrator accordingly agree as
follows:

    


    1. The
Arbitrator agrees to be bound by and to use his best efforts to comply
faithfully with the ADR Procedures, including without limitation, the provisions
regarding confidentiality.

    


    2. The
Arbitrator and the Arbitrator's employees, agents, partners and shareholders, if
applicable, shall not be liable for any respective act or omission in connection
with the ADR Procedures other than as a result of fraud or an intentional and
willful failure to comply with the material provisions of the ADR Procedures
after having received written notice of such failure and refusal by the
Arbitrator to correct such failure. Exercise of discretion shall not, by itself,
result in any liability.

    


    3.  The
Arbitrator has made a reasonable effort to learn and has disclosed to the
parties in writing:

    


    
      
        	
                (a)

              	
                All
      business or professional relationships the Arbitrator has had with the
      parties or the parties' law firms within the past five (5) years,
      including all instances in which the Arbitrator has served as an attorney
      for any party or adverse to any
party;

              


      

    

    


    
      	
              (b)

            	
              Any
      financial interests the Arbitrator has in any
  party;

            


    

    


    
      	
              (c)

            	
              Any
      significant social, business or professional relationship the Arbitrator
      has had with an officer or employee of any party or with an individual
      representing any party; and

            


    

    


    
      	
              (d)

            	
              Any
      other circumstances that may create doubt regarding the Arbitrator's
      impartiality.

            


    

    


    4.  Neither
the Arbitrator nor the Arbitrator's firm shall undertake any work for or against
a party
regarding the subject matter of the dispute.

    


    5.
Neither the Arbitrator nor any person assisting the Arbitrator with the ADR
Procedures shall personally work on any matter for or against any party or its
affiliates regardless of the subject matter, prior to one (1) year following
cessation of the Arbitrator's services in this proceeding other than as an
arbitrator in this or another proceeding.

    


    6.  The
Arbitrator's firm may work on matters for or against a party during the pendency
of the ADR Procedures if such matters are unrelated to the subject matter of the
ADR Procedures, have been disclosed in advance to all parties hereto, are
discussed with all of the parties hereto, and are expressly
consented to in writing by such parties (“Unrelated Approved
Activities"). The Arbitrator shall establish appropriate safeguards to
ensure that other members or employees of the Arbitrator's firm not working on
the ADR Procedures do not have access to any confidential information obtained
by the Arbitrator during the course of the ADR Procedures. The Arbitrator hereby
represents that there are no Unrelated
Approved Activities as of the date hereof.

    


    Exhibit D
to Procedures for Resolving Disputes Relating to the Development of New
Restaurants

    
      
         


      

      
        Page 77
of 124

        
          

        

      

      
         


      

    

    


    7. The
Arbitrator shall be compensated for services performed in connection with the
ADR Procedures in accordance with paragraph 8.2.1 of the ADR Procedures. The
Arbitrator's fee shall be taxed as costs and paid as determined by the
Arbitrator.

    


    
      	
              8.

            	
              Counsel
      representing each party is as
follows:

            


    

    


    Counsel
for Objecting Franchisee:

    _________________________

    __________________________

    __________________________

    


    Counsel
for EPL:

    __________________________

    ___________________________

    ___________________________

    


    
      
        	
                EL
      POLLO LOCO, INC.

              
	 
      
	
                BY:

              	
                  

              
	 
      	
                Vice
      President

              
	 
      
	
                [ARBITRATOR]

              
	 
      
	
                BY:

              	
                  

              
	 
      
	
                [OBJECTING
      FRANCHISEE]

              
	 
      
	
                BY:

              	
                  

              
	
                Name:

              	
                  

              


      

    

    
    

    Exhibit D to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 78
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
“E”

    TO
PROCEDURES FOR RESOLVING DISPUTES

    RELATING
TO THE DEVELOPMENT OF NEW RESTAURANTS

    


    PROMISSORY
NOTE

    
       

      
        
          	
                  $
      ________________

                	
                  ________________

                

 

      

    

    FOR VALUE
RECEIVED, the undersigned, EL POLLO LOCO, INC. (“EPL”), a Delaware
corporation, [INSERT ADDRESS], promises to pay to the order of
__________________, (“Franchisee”) the
principal sum of ___________________ Dollars
($        ) together with interest on
the unpaid principal balance hereof. Terms not otherwise defined in this Note
shall have the meanings specified in the Procedures for Resolving Disputes
Relating to the Development of New  Restaurants (the "ADR Procedures")
promulgated by EPL.

    


    Interest
at the rate of ____%1 simple interest per annum shall be payable annually
concurrently with the payment of principal required herein.

    


    EPL
hereby waives presentment, notice, protest and all other notices required or
permitted hereunder and by law in connection with the delivery, acceptance,
performance, default or enforcement of this Note and assents to any extension or
postponement of the time of payment or of any other indulgence, substitution,
exchange or release of collateral, and/or to the addition or release of any
other party or person primarily or secondarily liable on this Note.

    


    This Note
is being given to evidence EPL's obligation to Franchisee pursuant to the
Arbitrator's award granted under the ADR Procedures. The terms, covenants and
conditions of the ADR Procedures and other agreements between Franchisee and EPL
are expressly made a part of this instrument.

    


    The
principal of this Note shall be repaid in annual installments in accordance with
the Principal Repayment Schedule attached hereto as Schedule 1.

    


    This Note
may be prepaid in whole or in part by the undersigned at any time, or from time
to time, without premium or penalty.

    


    The
enforceability of the terms of this Note and the legality of the interest rate
specified herein shall be interpreted in accordance with and governed by the
laws of the State of California

    


    
      
        	
                EL
      POLLO LOCO, INC., a Delaware corporation

              
	 
      
	
                By:

              	
                  

              
	
                Name:

              	
                  

              
	
                Title:

              	
                  

              


      

    

    ________________________

     1     The
fixed interest rate will be equal to the prime rate published in the Wall Street Journal
for the day on which the award is granted.

    


    Schedule
1

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  Date of Principal Repayment

                                	
                                        

                                	
                                  Amount

                                
	 	 	 


                        

                      

                    

                  

                

              

            

          

        

      

    

     


    Exhibit E
to Procedures for Resolving Disputes Relating to the Development of New
Restaurants

    
      
         


      

      
        Page 79
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
“F”

    TO
PROCEDURES FOR RESOLVING DISPUTES

    RELATING
TO THE DEVELOPMENT OF NEW RESTAURANTS

    


    FACTORS,
EXAMPLES AND ANALYSES

    FOR
DETERMINING GROSS PERCENTAGE AND YEAR FACTOR

    


    OVERVIEW:

    


    There are
numerous factors that influence the sales of any EPL Restaurant. It is the
Arbitrator's responsibility under these ADR Procedures to consider all such
factors which may be relevant to understanding the negative sales impact
experienced by an Existing Site. A few examples of factors other than a new EPL
Restaurant which may negatively impact an Existing Site's sales and therefore
must also be considered by the Arbitrator include:

    


    -
Declining sales trends at the Existing Site pre-dating the New Restaurant

    


    - Loss of
traffic flows street (closures, construction activity, etc.)

    


    - New,
non-EPL competition

    


    - Overall
economic conditions/recession

    


    A useful
hierarchy to understand the various components of the overall impact on an
Existing Site, and to isolate the influence of those specific factors to be
utilized in determining the award pursuant to Section 7.6.4, is as
follows:

    


    
      	
              A.

            	 
      	
              Overall
      Impact on Objecting Franchisee's Existing Site Sales

            	 
      	
              XX%

            
	 
      	 
      	 
      	 
      	 
      
	
              B.

            	 
      	
              Plus
      or Minus DMA-Wide Trends

            	 
      	
              +/-  X%

            
	 
      	 
      	 
      	 
      	 
      
	
              C.

            	 
      	
              Impact
      Caused Within Existing Site's Trade Area

            	 
      	
              =  XX%

            
	 
      	 
      	 
      	 
      	 
      
	
              D.

            	 
      	
              Plus
      or Minus Factors Other Than New Restaurant

            	 
      	
              +/-  X%

            
	 
      	 
      	 
      	 
      	 
      
	
              E.

            	 
      	
              Impact
      on Existing Site by New Restaurant

            	 
      	
              =  X%

            
	 
      	 
      	 
      	 
      	 
      
	
              F.

            	 
      	
              Less
      Allowable Transfer Factor

            	 
      	
              - X%

            
	 
      	 
      	 
      	 
      	 
      
	
              G.

            	
                

            	
              Gross
      Percentage Factor

            	
                

            	
              = X%

            


    

    


    
      Step I of
the following methodology will assist in determining item C above- the impact on
the Existing Site's sales that appears to be localized within that restaurant's
trade area.

    

    


    Exhibit F
to Procedures for Resolving Disputes Relating to the Development of New
Restaurants

    
      
         


      

      
        Page 80
of 124

        
          

        

      

      
         


      

    


    Step II
will assist in identifying how much of this localized impact appears
attributable to the New Restaurant in question, rather than other factors within
the Existing Site's trade area. This will yield item E above, which is the
starting point in the award calculation described at Step 1. of Section
7.6.4.

    


    METHODOLOGY
TO ISOLATE IMPACT OF NEW RESTAURANT ON EXISTING SITE'S SALES:

    


    STEP
I:

    


    Determine
how much the sales of the Existing Site have been impacted overall during the
first 12 months of operations of the New Restaurant (the "Post Period") , and
then isolate that portion of the impact attributable to factors within the
Existing Site's trade area, by answering the following questions:

    


    
      	
              1.

            	
              What
      has been the % change in the Existing Site's year-over-year sales (“Y-O-Y
      Growth Rate") during the Post Period vs. the prior 12 months (the "Pre
      Period")?

            


    

    


    
      	
              2.

            	
              How
      does this Y-O-Y Growth Rate compare to the average experience of other
      EPL’S in the same county or demographic market area ("DMA”) over this same
      period of time?

            


    

    


    
      
        	
                3.

              	
                How
      closely did the Existing Site's Y-O-Y Growth Rate track that of the
      overall DMA average prior to the opening of the New Restaurant? How
      consistent has the variation between the two Y-O-Y Growth Rates been,
      historically?

              


      

    

    


    Example 1: Existing
Site's net sales decline 4% during the Post Period vs. the Pre Period. However,
the overall average decline of all restaurants in this DMA during the same
period is 6%. For the 2 years prior to the Pre Period, the Existing Site's Y-O-Y
Growth Rate was 2% greater than the overall DMA average, and this trend was
fairly consistent from month to month.

    


    Inference: While not conclusive in
itself, this data suggests that the sales decline experienced by the Existing
Site during the Post Period is due to factors other than the New Restaurant. In
fact, we might have "expected" the Existing Site to decrease by 4% during the
Post Period based on its previous trends vs. the overall DMA.

    


    Example 2: All facts
the same as Example 1, including a 4% decline for the Existing Site, except the
overall DMA Y-O-Y Growth Rate Post vs. Pre Period is a positive 6%.

    


    Inference: Again,
while not conclusive by itself, this data suggests that the Existing Site has
experienced a 12% decrease vs. expectation during the Post Period due to
localized factors specific to the Existing Site trade area, and not due to
DMA-wide variables.

    


    STEP II:

    


    If there
appears to be an impact on the Existing Site that is due to factors within its
trade area, rather than due to broader, DMA-wide trends (Example 2 above),
identify all significant factors that may have contributed to this impact in
addition to the New Restaurant. These could include but may not be limited to
the following:

    


    1.           Decline
in potential customer traffic in Existing Site's trade area:

    


    A.           Loss
of traffic generators (closure of nearby military base, shopping center
Anchor
tenant or large employer in trade area).

    


    B.           Loss
of traffic flows (closure of streets, bridges or freeway ramps).

    


    C.    Newer
traffic generators developed in nearby trade areas eclipse traffic
generators  in Existing Site's trade area.

    
    

    Exhibit F to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 81
of 124

        
          

        

      

      
         


      

    

    


    
      
        	
                2.

              	
                New
      restaurant competition other than the new EPL in the Existing Site's trade
      area.

              


      

    

    


    
      	
              3.

            	
              Change
      in the Management Team or deterioration in the quality of operations of
      the Existing Site.

            


    

    


    It may be
conversely true that new traffic generators, improvement in traffic flows or the
closure of competing restaurants in an Existing Site's trade area, or an
improvement in the quality of operations in an Existing Site would have resulted
in a positive impact on the Existing Site's sales but for the opening of the New
Restaurant.

    


    It may be
difficult to separately identify the negative or positive impact of the above
factors on an Existing Site's sales from the impact of the New Restaurant. It
may be that one can do so only by paying close attention to the dates that each
factor became relevant, and tracking the incremental impact of each on the
Existing Site's Y-O-Y Growth Rate.

    


    Example 3: Existing
Site is in an older shopping center; many of the co-tenants have never remodeled
or updated their facilities.  New regional "Power Center" with a
Walmart, Toys R Us, Home Depot, a 20 Theater Cinema and several new restaurants
(but no EPL's) opens 3 miles away. Existing Site's sales drop 8% within one
month. Assume overall DMA sales are flat during this period, and no other new
variables or any other change in the trade area.

    


    Inference: Many of
the Existing Site's customers will be drawn to the traffic generators in the new
center, and allocate some of their limited eating out dollars to whatever
restaurant choices are available when they are there, since it is convenient.
All or a substantial portion of the 8% drop in sales can reasonably be
attributed to the new center.

    


    Example 4: Same as
Example 3, except that a new EPL Restaurant opens at the new Power Center 6
months after the last anchor tenant opens. Existing Site's sales then decline
further, to a 12% overall decline vs. before the Power Center opened, as
follows:

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      	
                                              Existing Site’s Avg. Monthly Sales:

                                            	 	
                                              Amount

                                            	 	 	
                                              Cumulative % Change

                                            	 
	 
      	 	 	 	 	 	 
	
                                              12
      months prior to New Power

                                            	 	 	 	 	 	 
	
                                              Center
      opening

                                            	 	$	83,333	 	 	 	—	 
	 
      	 	 	 	 	 	 	 	 
	
                                              First
      6 months New Power

                                            	 	 	 	 	 	 	 	 
	
                                              Center
      open

                                            	 	$	76,666	 	 	 	(8	)%
	 
      	 	 	 	 	 	 	 	 
	
                                              Next
      12 months

                                            	 	 	 	 	 	 	 	 
	
                                              New
      Restaurant Open

                                            	 	$	73,333	 	 	 	(12	)%


                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    


    Inference: It would
appear that the majority of the decline is due to the existence of the new Power
Center (8%), and that only about 4% is due to the New Restaurant (= 12%-
8%).

    


    
      DISCUSSION
RE: YEAR FACTOR:

    

    


    The
intention of the Year Factor is to recognize that restaurant businesses are
often valued based upon a multiple of cash flows. If an Objecting Franchisee
suffers a permanent reduction in sales and cash flows in an Existing Site due to
unreasonable impact by a New Restaurant, then the business value of the Existing
Site has declined by some multiple of the reduction. If the sales reduction is
expected to become even greater over time, based upon trends observed during the
Post Period, a larger multiple should be selected by the Arbitrator. Conversely,
if trends observed during the Post Period or other evidence appear to indicate
that the impact of the New Restaurant upon the Existing Site will diminish over
time, a relatively smaller multiple should be used.

    
    

    Exhibit F to Procedures for Resolving Disputes Relating to the Development
of New Restaurants

    
      
         


      

      
        Page 82
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
2 TO FRANCHISE AGREEMENT

    


    MEMORANDUM
OF OPENING DATE

    


    On
_________________, 20__ El Pollo Loco, Inc. (“Franchisor”), and
____________________________ (“Franchisee”), entered into a Franchise Agreement
(the “Franchise Agreement”) for an “El Pollo Loco” Restaurant to be located at
____________________________________(the “Location”).

    


    The
parties hereby agree that the Opening Date of the Restaurant at the Location was
____________________, 20___.

    


    The term
of the Franchise Agreement shall expire on ________________, 20___, unless
sooner terminated as provided in the Franchise Agreement.

    


    IN
WITNESS WHEREOF, the parties hereto have caused this Memorandum of Opening Date
to be executed as of the ______ day of __________________, 20___.

    


    
      
        	
                THE
      FRANCHISOR:

              	 
      	
                FRANCHISEE:

              
	
                EL
      POLLO LOCO, INC.,

              	 
      	 
      
	
                a
      Delaware Corporation

              	 
      	 
      
	 
      	 
      	 
      
	
                By:

              	
                  

              	 
      	
                By:

              	
                  

              
	 
      	 
      	 
      	 
      	 
      
	
                Its:

              	
                  

              	 
      	
                Its:

              	
                  

              
	 
      	 
      	 
      	 
      	 
      
	
                Date:

              	
                  

              	
                  

              	
                Date:

              	
                  

              


      

    

    


    Exhibit 2
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 83
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
3 TO FRANCHISE AGREEMENT

    


    PERSONAL
GUARANTEE

    


    The
undersigned hereby unconditionally guarantees, absolutely and irrevocably the
performance and payment by Franchisee (as defined below) of, and expressly
agrees to adopt and be bound by, each and all of the terms, covenants and
conditions of that certain Franchise Agreement dated _______________, 20___ (the
“Agreement”) between EL POLLO LOCO, INC., a Delaware corporation (“Franchisor”)
whose address is 3535 Harbor Blvd, Suite 100, Costa Mesa, CA  92626
and ____________________ (“Franchisee”) whose address is
____________________.  The undersigned further agrees as
follows:

    


    1.           This
guarantee will continue unchanged by any bankruptcy, reorganization or
insolvency of Franchisee or by any disaffirmance or abandonment by a trustee of
Franchisee.

    


    2.           This
covenant and agreement on the part of the undersigned shall continue in favor of
Franchisor notwithstanding any extension, modification or alteration of the
Agreement entered into by and between the parties thereto, or their successors
or assigns, and no extension, modification, alteration or assignment of the
Agreement shall in any manner release or discharge the undersigned and the
undersigned does hereby consent thereto.

    


    3.           The
liability of the undersigned under this guarantee shall be primary and in any
right of action which shall accrue to Franchisor under the Agreement, Franchisor
may, at its option, proceed against the undersigned without having commenced any
action or having obtained any judgment against Franchisee.

    


    4.           The
undersigned shall pay Franchisor’s reasonable attorneys’ fees and all costs and
other expenses incurred in any collection or attempted collection or in any
negotiations relative to the obligations hereby guaranteed or enforcing this
guarantee against the undersigned, individually and jointly only if final
judgment is entered in favor of Franchisor.

    


    5.           The
undersigned hereby waives notice of any demand by Franchisor as well as any
notice of default in the payment of any and all amounts contained or reserved in
the Agreement.

    


    6.           All
sums due under this guarantee shall bear interest from the date due until the
date paid at the maximum contract rate permitted by law.  The
obligations under this guarantee include, without limitation, payment when due
of any and all sums due under the Agreement and all damages to which Franchisor
is or may be entitled whether under applicable law, indemnification payments and
payment of any and all legal fees, courts costs and litigation expenses incurred
by Franchisor in endeavoring to collect or enforce any of the foregoing against
Franchisee, the undersigned, or in connection with any property securing any or
all of the foregoing or this guarantee.

    


    7.           The
undersigned agrees that one or more successive or concurrent actions may be
brought on this guarantee, in the same action in which Franchisee may be sued or
in separate actions, as often as deemed advisable by Franchisor.  The
obligations under this guarantee are joint and several, and independent of the
obligations of Franchisee.

    


    8.           No
election in one form of action or proceeding, or against any party, or on any
obligation, shall constitute a waiver of Franchisor’s right to proceed in any
other form of action or proceeding or against any other party.  The
failure of Franchisor to enforce any of the provisions of this guarantee at any
time or for a period of time shall not be construed to be a waiver of any such
provision or the right thereafter to enforce the same.  All remedies
under this guarantee shall be cumulative and shall be in addition to all rights,
powers and remedies given to Franchisor by law or under any other instrument or
agreement.

    


    9.           All
rights, benefits and privileges under this guarantee shall inure to the benefit
of and be enforceable by Franchisor and its successors and assigns and shall be
binding upon the undersigned and his heirs, representatives, successors and
assigns.  Neither the death of the undersigned nor notice thereof to
Franchisor shall terminate this guarantee as to his estate, and, notwithstanding
the death of the undersigned or notice thereof to Franchisor, this guarantee
shall continue in full force and effect.  The provisions of this
guarantee may not be waived or amended except in writing executed by the
undersigned and a duly authorized representative of Franchisor.

    


    Exhibit 3
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 84
of 124

        
          

        

      

      
         


      

    

    


    10.           The
undersigned represents and warrants that (i) it is in the undersigned’s direct
interest to assist Franchisee in procuring the Agreement, because Franchisee has
a direct or indirect corporate or business relationship with the undersigned,
(ii) this guarantee has been duly and validly authorized executed and delivered
and constitutes the binding obligation of the undersigned, enforceable in
accordance with its terms, and (iii) the execution and delivery of this
guarantee does not violate (with or without the giving of notice, the passage of
time, or both) any order, judgment, decree, instrument or agreement to which the
undersigned is a party or by which it or its assets are affected or
bound.

    


    11.           If
any provision of this guarantee or the application thereof to any party or
circumstance is held invalid, void, inoperative, or unenforceable, the remainder
of this guarantee and the application of such provision to other parties or
circumstances shall not be affected thereby, the provisions of this guarantee
being severable in any such instance.  This guarantee is the entire
and only agreement between the undersigned and Franchisor respecting the
guaranty of the Agreement, and all representations, warranties, agreements, or
undertakings heretofore or contemporaneously made, which are not set forth in
this guarantee, are superseded.

    


    12.           Any
notice which a party shall be requested or shall desire to give to the other
under this guarantee shall be given by personal delivery or by depositing the
same in the United States mail, first class postage pre-paid, addressed to
Franchisor at its address set forth above and to the undersigned at its address
set forth above, and such notices shall be deemed duly given on the date of
personal delivery or three (3) days after the date of mailing as
aforesaid.  Either party may change their address for purposes of
receiving notices under this guarantee by giving written notice thereof to the
other party in accordance with this section.

    


    13.           This
guarantee is governed by and construed according to the laws of the State of
California applicable to contracts made and to be performed in such
state.  In order to induce Franchisor to accept this guarantee, and as
a material part of the consideration therefore, the undersigned (i) agrees that
all actions or proceedings relating directly or indirectly to this guarantee
shall, at the option of the Franchisor, be litigated in courts located within
the State of California, and (ii) consents to the jurisdiction of any such court
and consents to the service of process in any such action or proceeding by
personal delivery or any other method permitted by law.

    


    The undersigned waives and relinquishes
any rights it may have under California Civil Code 2845, 2849 and 2850 or
otherwise to require Franchisor to (a) proceed against Franchisee or any other
guarantor, pledgor or person liable under the Agreement; (b) proceed against or
exhaust any security for the Franchisee or this guarantee; or (c) pursue any
other remedy in Franchisor’s power whatsoever.  In other words,
Franchisor may proceed against the undersigned for the obligations guaranteed
without first taking any action against Franchisee or any other guarantor,
pledgor or person liable under the Agreement and without proceeding against any
security.  The undersigned shall not have, and herby waives (a) any
right of subrogation, contribution, indemnity and any similar right that the
undersigned may otherwise have, (b) any right to any remedy which Franchisor now
has or may hereafter have against Franchisee, and (c) any benefit of any
security now or hereafter held by Franchisor.  The undersigned waives
(a) all presentments, demands for performance, notices of non-performance,
protests, notices of protests and notices of dishonor; (b) all other notices and
demands to which the undersigned might be entitled, including without limitation
notice of all the following:  the acceptance hereof; any adverse
change in Franchisee’s financial position; any other fact which might increase
the undersigned’s risk; any default, partial payment or non-payment under the
Franchisee and any changes, modifications, or extensions thereof; and any
revocation, modification or release of any guaranty of any or all of the
Agreement by any person (including without limitation any other person signing
this guarantee): (c) any defense arising by reason of any failure of Franchisor
to obtain, perfect, maintain or keep in force any security interest in any
property of Franchisee or any other person; (d) any defense based upon or
arising out of any bankruptcy, insolvency, reorganization, arrangement,
readjustment of debt, liquidation or dissolution proceeding commenced by or
against Franchisee or any other guarantor or any person liable under the
Agreement.

    
    

    Exhibit 3 to Franchise Agreement (Exhibit D of Disclosure Document
033109)

    
      
         


      

      
        Page 85
of 124

        
          

        

      

      
         


      

    

    


    Without limiting the generality of the
foregoing or any other provision of this guarantee, the undersigned expressly
waives any and all benefits which might otherwise be available to it under
California Civil Code 2839 (which provides that a surety is exonerated by the
performance or the offer of performance of the principal obligation), 2899
(which provides for the order of resort to different funds held by the creditor)
and 3433 (which provides for the right of a creditor to require that another
creditor entitled to resort to several sources of payments first resort to
sources not available to the first creditor).  The undersigned waives
the rights and benefits under California Civil Code 2819 and agrees that by
doing so its liability shall continue even if Franchisor alters any obligations
under the Agreement in any respect or Franchisor’s rights or remedies against
Franchisee are in any way impaired or suspended without the undersigned’s
consent.  Franchisor may without notice assign this guarantee in whole
or in part.

    


    14.           The
undersigned has had the opportunity to review this guarantee with its counsel
and such counsel has explained to it the meaning and significance of the
provisions of this guarantee, including but not limited to the waivers and
consents contained in this guarantee, and answered any questions that it had
regarding the meaning, significance and effect of the provisions of this
guarantee.

    


    


    The use of the singular herein shall
include the plural.  The obligations of two or more parties shall be
joint and several.  The terms and provisions of this guarantee shall
be binding upon and inure to the benefit of the respective successors and
assigns of the parties herein named.

    


    IN WITNESS WHEREOF, the
undersigned executed this guarantee on this _____ day of _________________,
20___.

    


    
      
        	
                  

              	 
      	
                  

              
	
                NAME

              	
                  

              	
                NAME

              


      

    

      

    Exhibit 3 to Franchise Agreement (Exhibit D of Disclosure Document
033109)

    
      
         


      

      
        Page 86
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
4 TO FRANCHISE AGREEMENT

    


    INVESTOR
COVENANTS REGARDING

    CONFIDENTIALITY
AND NON-COMPETITION

    


    In
conjunction with your investment in __________ ("Franchisee") a ____________ you
(Investor" or "you"), acknowledge and agree as follows:

    


    
      	
              1.

            	
              Franchisee
      owns and operates, or is developing, pursuant to a Franchise Agreement
      dated _______________ ("Franchise Agreement") with El Pollo Loco, Inc.
      (“EPL”), which Franchise Agreement requires persons with legal or
      beneficial ownership interests in Franchisee under certain circumstances
      to be personally bound by the confidentiality and non-competition
      covenants contained in the Franchise Agreement.  All capitalized
      terms contained herein shall have the same meaning set forth in the
      Franchise Agreement.

            


    

    


    
      	
              2.

            	
              You
      own or intend to own a __% legal or beneficial ownership interest in
      Franchisee and acknowledge and agree that your execution of this Agreement
      is a condition to such ownership interest and that you have received good
      and valuable consideration for executing this Agreement.  EPL
      may enforce this Agreement directly against you and your Owners (as
      defined below).

            


    

    


    
      	
              3.

            	
              If
      you are a corporation, partnership, limited liability company or other
      entity, all persons who have a legal or beneficial interest in you
      ("Owners") must also execute this
Agreement.

            


    

    


    
      	
              4.

            	
              You
      and your Owners, if any, may gain access to parts of EPL’s Confidential
      Information as a result of investing in Franchisee.  The
      Confidential Information is proprietary and includes EPL's trade
      secrets.  You and your Owners hereby agree that while you and
      they have a legal or beneficial ownership interest in franchise and
      thereafter you and they: (a) will not use the Confidential Information in
      any other business or capacity (such use being an unfair method of
      competition); (b) will exert best efforts to maintain the confidentiality
      of the Confidential Information; and (c) will not make unauthorized copies
      of any portion of the Confidential Information disclosed in written,
      electronic or other form.  If you or your Owners cease to have
      an interest in franchisee, you and our Owners, if any, must deliver to EPL
      any such Confidential Information in your or their
    possession.

            


    

    


    
      	
              5.

            	
              During
      the term of the Franchise Agreement and during such time as you and your
      Owners, if any, have any legal or beneficial ownership interest in
      Franchisee, you and your Owners, if any, agree that you and they will not,
      without EPL's consent (which consent may be withheld at EPL's discretion)
      directly or indirectly (such as through an Affiliate or through your or
      their Immediate Families) own any legal or beneficial interest in, or
      render services or give advice in connection with: (a) any Competitive
      Business located anywhere, or (b) any entity located anywhere that grants
      franchises or licenses interest to others to operate any Competitive
      Business.

            


    

    


    
      	
              6.

            	
              For
      a period of two (2) years, starting on the earlier to occur of the date
      you or your Owners cease to have any legal or beneficial ownership
      interest in Franchisee and the effective date of termination or expiration
      of the Franchise Agreement, neither you nor any of your Owners directly or
      indirectly (such as through an Affiliate or through your or their
      Immediate Families) shall own a legal or beneficial interest in, or render
      services or give advice to: (a) any Competitive Business operating within
      a radius of five (5) miles of any El Pollo Loco. then in operation or
      under construction; or (b) any entity that grants franchises or license
      other interest to others to operate any Competitive
      Business.  If you or any of your Owners fail to or refuse to
      abide by any of the foregoing covenants and EPL. obtains enforcement in a
      judicial or arbitration proceeding, the obligations under the breached
      covenant will continue in effect for a period of time ending two (2) years
      after the date such person commences compliance with the order enforcing
      the covenant.

            


    

    


    Exhibit 4
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 87
of 124

        
          

        

      

      
         


      

    

    


    
      	
              7.

            	
              You
      and each of your Owners expressly acknowledge the possession of skills and
      abilities of a general nature and the opportunity to exploit such skills
      in other ways, so that enforcement of the covenants contained in Sections 5 and
      6 will
      not deprive any of you of your personal goodwill or ability to earn a
      living.  If any covenant herein, which restricts competitive
      activity, is deemed unenforceable by virtue of its scope or in terms of
      geographic area, type of business activity prohibited and/or length of
      time, but could be rendered enforceable by reducing any part of all of it,
      you and we agree that it will be enforce to the fullest extent permissible
      under applicable law and public policy.  EPL may obtain in any
      court of competent jurisdiction any injunctive relief, including temporary
      restraining orders and preliminary injunctions, against conduct or
      threatened conduct for which no adequate remedy at law may be available or
      which may cause it irreparable harm.  You and each of your
      Owners acknowledges that any violation of Section 4, 5,
      or 6
      hereof would result in irreparable injury for which no adequate remedy at
      law may be available.  If EPL, Inc. files a claim to enforce
      this Agreement and prevails in such proceeding, you agree to reimburse
      EPL, Inc. for all its cost and expense, including reasonable attorneys'
      fees.

            


    

    


    IN
WITNESS WHEREOF, the undersigned have executed and delivered this Agreement on
the __ day of __________, 20___.

    


    
      
        	
                INVESTOR

              	 
      	 
      
	
                If
      an Individual

              	 
      	
                If
      a corporation, partnership, limited liability

                company
      or other legal entity:

              
	 
      	 
      	 
      
	
                  

              	 
      	
                  

              
	
                (Signature)

              	 
      	
                (Name
      of corporation, partnership, limited

                liability
      company or other legal entity)

              
	
                  

              	 
      	 
      
	
                (Print
      Name)

              	
                  

              	 
      


      

    

    


    
      
        	
                By:

              	
                  

              


      

    

    
      
        	
                Print
      Name:

              	
                  

              


      

    

    
      
        	
                Title:

              	
                  

              


      

    

    


    OWNERS

    


    
      
        	
                By:

              	
                  

              


      

    

    


    
      
        	
                Print
      Name:

              	
                  

              


      

    

    


    
      
        	
                By:

              	
                  

              


      

    

    


    
      
        	
                Print
      Name:

              	
                  

              


      

    

      

    Exhibit 4 to Franchise Agreement (Exhibit D of Disclosure Document
033109)

    
      
         


      

      
        Page 88
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
5 TO FRANCHISE AGREEMENT

    


    AUTHORIZATION
AGREEMENT FOR PREARRANGED PAYMENTS

    (DIRECT
DEBITS)

    


    The
undersigned depositor (“Depositor”) hereby authorizes El Pollo Loco, Inc. (“El
Pollo Loco”) to initiate debit entries and/or credit correction entries to the
Depositor’s checking and/or savings account(s) indicated below and the
depository (“Depository”) to debit such account pursuant to El Pollo Loco’s
instructions.

    


    
      
        	
                  

              	 
      	
                  

              
	
                Depository

              	 
      	
                Branch

              
	 
      	 
      	 
      
	
                  

              	 
      	 
      
	
                Street
      Address, City, State, Zip Code

              	 
      	 
      
	 
      	 
      	 
      
	
                  

              	 
      	
                  

              
	
                Bank
      Transit/ABA Number

              	
                  

              	
                Account
      Number

              


      

    

    


    This
authority is to remain in full force and effect until Depository has received
joint written notification from El Pollo Loco®
and Depositor of the Depositor’s termination of such authority in such time and
in such manner as to afford Depository a reasonable opportunity to act on
it.  Notwithstanding the foregoing, Depository shall provide El Pollo
Loco®
and Depositor with thirty (30) days’ prior written notice of the termination of
this authority.  If an erroneous debit entry is initiated to
Depositor’s account, Depositor shall have the right to have the amount of such
entry credited to such account by Depository, if within fifteen (15) calendar
days following the date on which Depository sent to Depositor a statement of
account or a written notice pertaining to such entry or forty five (45) days
after posting, whichever occurs first, Depositor shall have sent to Depository a
written notice identifying such entry, stating that such entry was in error and
requesting Depository to credit the amount thereof to such
account.  These rights are in addition to any rights Depositor may
have under federal and state banking laws.

    


    
      
        	
                  

              	 
      	
                  

              
	
                Depositor

              	 
      	
                Depository

              
	 
      	 
      	 
      
	
                By:

              	
                  

              	 
      	
                By:

              	
                  

              
	 
      	 
      	 
      	 
      	 
      
	
                Title:

              	
                  

              	 
      	
                Title:

              	
                  

              
	 
      	 
      	 
      	 
      	 
      
	
                Date:

              	
                  

              	 
      	
                Date:

              	
                  

              


      

    

    


    


    
      
        	
                 

                ATTACH
      VOIDED CHECK HERE

                 

              


      

    

    


    Exhibit 5
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 89
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
6 TO FRANCHISE AGREEMENT

    


    ADVERTISING
ASSOCIATION MEMBERSHIP AGREEMENT

    


    THE [NAME OF
AREA] EL
POLLO LOCO®
RESTAURANT ADVERTISING ASSOCIATION

    


    MEMBERSHIP
AGREEMENT

    


    THIS [NAME OF
AREA] EL POLLO
LOCO®
RESTAURANT ADVERTISING ASSOCIATION MEMBERSHIP AGREEMENT
is effective as of _____________________, 20___, by and between the    [NAME
OF AREA] EL POLLO
LOCO®
RESTAURANT ADVERTISING ASSOCIATION, INC. a ______________ Nonprofit Corporation
[the “Association”] and ________________________________, a________________(the
“Member”).

    


    BACKGROUND
INFORMATION:

    


    EL POLLO
LOCO, INC. (the “Franchisor”) owns, operates and franchises quick service
restaurants which specialize in the sale of retail marinated ________ grilled
chicken and Mexican food items related to the El Pollo Loco® concept
(“Restaurants”).  The Member owns and operates one or more Restaurants
within the    ____________________________[described geographic
area]_________________________________________ (the “Association
Area”).  The Association was organized by the Franchisor and its
franchisees that own Restaurants in the Association Area in order to pool
advertising funds.

    


    OPERATIVE
TERMS:

    


    1.      Bylaws.  The
Association has adopted Bylaws and may amend, modify or replace them from time
to time in accordance with its governing documents, subject to the written
consent of the Franchisor (the “Bylaws”).  Unless the context requires
otherwise, terms used in this Agreement will have the meanings as defined in the
Bylaws.

    


    2.      Membership.  By
signing this Agreement:

    


    (a) 
The Member agrees to become a member of the Association and agrees to be bound
by and adhere to the Bylaws, and to observe any administrative rules,
regulations and policy statements adopted by the Association in accordance with
the Bylaws; and

    


    (b) 
The Association accepts and enrolls the Member as a member in good standing with
full rights and Benefits of membership.

    


    3.      Scope.  This
Agreement is applicable to all of the Member’s Restaurants located in the
Association Area, whether currently existing, or opened or acquired after the
signing of this Agreement.

    


    4.      Contributions.

    


    (a) 
Obligation
to Pay:  The Member agrees to make such contributions to the
Association, and at such time and in such manner, as are determined by the
Association from time to time in accordance with the
Bylaws.  Contributions are non-refundable.

    


    (b) 
Reports:  Each
contribution must be accompanied by a report containing such information as the
Association may determine from tome to time, showing the amount of the
contribution the Member is required to pay with respect to the Member’s
Restaurants located in the Association Area.  The Member authorizes
and instructs the Franchisor to furnish to the Association, on request, copies
of the Member’s reports and records in Franchisor’s possession for the purpose
of verifying contributions due.  The Association may review reports
and other information available to the Franchisor to verify that the proper
amount of contributions have been made by the Member.

    


    Exhibit 6
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 90
of 124

        
          

        

      

      
         


      

    

    


    


    (c) 
Collection
by Franchisor:  The Member acknowledges and agrees that the
Association may authorize Franchisor to receive and collect contributions and
related reports on behalf of the Association.  In such case, the
Member shall make contributions to Franchisor, and shall report to Franchisor,
at such times and in such manner as Franchisor may determine to be appropriate
from time to time.

    


    5.      Benefits.  The
Association agrees that it will operate on a not-for-profit basis in accordance
with governing documents and that all contribution will be spent solely for the
purposes permitted in its Articles of Incorporation and Bylaws.

    


    6.      Effective
Date and Term. The Agreement becomes effective on the date signed by both
Parties and will continue until the earlier of:

    


     
(a)  The Association discontinues operations or is dissolved;
or

    


     
(b)  Until the Member no longer owns and operates a Restaurant located in
the Association Area under a valid Franchise Agreement with Franchisor, or until
the Member no longer owns or operates a Restaurant located in the Association
Area, if the Member is the Franchisor or an affiliate of
Franchisor.

    


    In the event this Agreement terminates
pursuant to Section 6(b), the Member’s voting and other membership rights in the
Association automatically terminate on the effective date of termination of the
Franchise Agreement (or closure of the Restaurant, if the Franchisor or its
affiliate is the Member), provided however, if the Member owes contributions at
the time of such termination (or closure), then it will still be obligated and
responsible for all contributions that accrued prior to the date of such
termination (or closure).

    


    7.       Franchise
Transfers.  The parties recognize that the timing of payment of
contributions may not always coincide with the consummation of the sale of a
Restaurant.  Accordingly, the parties agree as follows:

    


     
(a)  Timing:  The Member
will remain responsible to the Association for all contributions due through the
date of the consummation of any sale of a El Pollo Loco®
restaurant owned by the Member that is subject to this Agreement.

    


     
(b)  Credit
Balances:  If the Member sells or closes a El Pollo Loco®
restaurant subject to this Agreement at a time when the Member has a credit
balance with the Association, the credit balance will not be refunded, but will
be: (i) retained for the benefit of other members of the Association, if the
transaction involves a closing of the Member’s El Pollo Loco®
restaurant or the termination or expiration of the Member’s Franchise Agreement;
or (ii) credited to the Restaurants of the purchaser that are subject to this
Agreement, if a sale, transfer or assignment is involved; or (iii) credited to
the Member’s other Restaurants that are still subject to this
Agreement.

    


    8.       Delinquencies.  The
Member agrees to abide by all rules and regulations regarding delinquent
contributions, including the payment of interest and late payment fees, adopted
by the Association from time to time.  the Member acknowledges and
agrees that delinquent contributions (a) constitute a breach of the Franchise
Agreement; (b) may result in loss of voting rights and other privileges with the
Association; and/or (c) may result in cancellation of membership with the
Association.

    
    

    Exhibit 6 to Franchise Agreement (Exhibit D of Disclosure Document
033109)

    
      
         


      

      
        Page 91
of 124

        
          

        

      

      
         


      

    

    


    9.       Entity
Participation.  If the Member is a corporation, limited
liability company, partnership or other business entity, the Member will duly
authorize one (1) person to represent its interests at Association meetings (the
“Representative”).  The Representative must be
a:  (i)  shareholder, partner, member (in case of an LLC),
director or officer of the Member; or (ii) the Member’s Operating Partner, as
defined in the Member’s Franchise Agreement; or (iii) in the event the Member is
Franchisor or one of its affiliates, an officer or other designated
representative of the Franchisor or it affiliate.  The Association
shall be entitled to rely on any written authorization appointing the
Representative that the Association in good faith believes to be valid unless
and until the Association shall have received an authorization for a successor
Representative’s decisions, votes and consents to bind the Member at any such
meeting without any
further inquiry.  The same person can be a Representative for more
than one (1) Member.

    


    10.     Program
Participation.  The Member will not be required, as a condition
of membership in this Association or otherwise, to participate in any
advertising or promotion that contains a specified retail price, or a minimum
retail price, for any product or service furnished by Restaurant in the
Association Area.  However, the Member’s obligation to pay
contributions pursuant to this Agreement will not be affected in ay way by the
Member’s decision not to participate.

    


    11.     Miscellaneous.


    


    (a) 
Severability:  If any part of this Agreement is held invalid for any
reason, the remainder of this Agreement will not be affected and will remain in
full force and effect in accordance with its terms.

    


    (b) 
Costs of Collection:  Member agrees to reimburse the Association (or,
if applicable, Franchisor) for all costs and expenses, including attorneys’ fees
and expenses, incurred in connection with collecting delinquent
contributions.  Reimbursement is due within thirty (30) days of
written notice.

    


    (c) 
Waivers:  No waiver of any provision of this Agreement will be valid
unless in writing and signed by the person signed by the person against whom it
is sought to be enforced.  The failure by either party to insist upon
strict performance of any provision will not be construed as a waiver or
relinquishment of the right to insist upon strict performance of the same
provision at any other time or to insist on strict performance of any other
provision of this Agreement.

    


    (d) 
Liabilities and Beneficiaries:  Neither party will be liable to any
other person who is not Party to this not a Party to this not a party to this
Agreement by virtue of their relationship to each other.  No other
person has any rights because of this Agreement, except for the
parties.  However, notwithstanding the foregoing, although the
Franchisor may not be a party to this Agreement, and is not bound by it,
Franchisor is a third-party intended beneficiary.

    


    (e) 
Entire Agreement:  This Agreement reflects the entire understanding of
the parties with respect to the subject matter hereof and supersedes all prior
oral or written agreements, communications or understandings with respect to the
matters provided for herein.

    


       [NAME
OF AREA]     EL POLLO LOCO®
RESTAURANT

    


    
      
        	
                By:

              	
                   

              
	
                Name:

              	
                   

              
	
                Title:

              	
                   

              
	
                Date:

              	
                   

              
	 
      
	
                ADVERTISING
      ASSOCIATION, INC.

              
	
                [Name
      of Member]

              
	
                By:

              	
                   

              
	
                Name:

              	
                   

              
	
                Title:

              	
                   

              
	
                Date:

              	
                   

              


      

    

    
    

    Exhibit 6 to Franchise Agreement (Exhibit D of Disclosure Document
033109)

    
      
         


      

      
        Page 92
of 124

        
          

        

      

      
         


      

    


    EXHIBIT
6 TO FRANCHISE AGREEMENT

    


    ADVERTISING
ASSOCIATION BYLAWS

    


    
      
        

      



    BYLAWS

    


    OF

    


    _____[NAME OF
AREA]_____EL POLLO
LOCO®
RESTAURANT ADVERTISING ASSOCIATION, INC.

    


    
      
        

      

    

    


    Adopted
as of _______________, 20___

     

    Exhibit 6 to Franchise Agreement (Exhibit D of Disclosure Document
033109)

    
      
         


      

      
        Page 93
of 124

        
          

        

      

      
         


      

    

     

    TABLE
OF CONTENTS

    


    
      
        
          
            
              
                
                  	
                          ARTICLE

                        	 	
                          PAGE

                        
	 
      	 
      	 	 
      
	
                          ARTICLE 1 OFFICES

                        	 	
                          96

                        
	
                          SECTION 1.1

                        	
                          REGISTERED
      AND PRINCIPAL OFFICE

                        	 	
                          96

                        
	
                          SECTION 1.2

                        	
                          OTHER
      OFFICES

                        	 	
                          96

                        
	
                          SECTION 1.3

                        	
                          REGISTERED
      AGENT FOR SERVICE OF PROCESS

                        	 	
                          96

                        
	 
      	 
      	 	 
      
	
                          ARTICLE 2 POWERS AND PURPOSE

                        	 	
                          96

                        
	
                          SECTION 2.1

                        	
                          POWERS

                        	 	
                          96

                        
	
                          SECTION 2.2

                        	
                          PURPOSES

                        	 	
                          96

                        
	
                          SECTION 2.3

                        	
                          USE
      OF TRADEMARKS

                        	 	
                          96

                        
	 
      	 
      	 	 
      
	
                          ARTICLE 3 MEMBERS

                        	 	
                          97

                        
	
                          SECTION 3.1

                        	
                          MEMBERS

                        	 	
                          97

                        
	
                          SECTION 3.2

                        	
                          ENROLLMENT

                        	 	
                          97

                        
	
                          SECTION 3.3

                        	
                          ENTITY
      MEMBERSHIP

                        	 	
                          97

                        
	
                          SECTION 3.4

                        	
                          MEMBERS
      IN GOOD STANDING

                        	 	
                          97

                        
	
                          SECTION 3.5

                        	
                          ANNUAL
      AND QUARTERLY MEETINGS OF THE MEMBERS

                        	 	
                          97

                        
	
                          SECTION 3.6

                        	
                          SPECIAL
      MEETINGS

                        	 	
                          98

                        
	
                          SECTION 3.7

                        	
                          PLACE
      OF MEETING

                        	 	
                          98

                        
	
                          SECTION 3.8

                        	
                          NOTICE
      OF MEETINGS

                        	 	
                          98

                        
	
                          SECTION 3.10

                        	
                          CLOSURE
      OF BOOKS AND FIXING OF RECORD DATE

                        	 	
                          98

                        
	
                          SECTION 3.11

                        	
                          QUORUM

                        	 	
                          99

                        
	
                          SECTION 3.12

                        	
                          VOTING

                        	 	
                          99

                        
	
                          SECTION 3.13

                        	
                          REPRESENTATIVES

                        	 	
                          99

                        
	
                          SECTION 3.14

                        	
                          ACTION
      WITHOUT MEETING

                        	 	
                          99

                        
	
                          SECTION 3.15

                        	
                          ORGANIZATION

                        	 	
                          100

                        
	
                          SECTION 3.16

                        	
                          MEMBER
      MEETINGS BY TELEPHONE

                        	 	
                          100

                        
	 
      	 
      	 	
                           

                        
	
                          ARTICLE 4 DIRECTORS

                        	 	
                          100

                        
	
                          SECTION 4.1

                        	
                          NUMBER

                        	 	
                          100

                        
	
                          SECTION 4.2

                        	
                          VACANCIES

                        	 	
                          100

                        
	
                          SECTION 4.3

                        	
                          REMOVAL
      OF DIRECTORS

                        	 	
                          100

                        
	
                          SECTION 4.4

                        	
                          QUALIFICATION

                        	 	
                          101

                        
	
                          SECTION 4.5

                        	
                          TERMS

                        	 	
                          101

                        
	
                          SECTION 4.6

                        	
                          RESIGNATION

                        	 	
                          101

                        
	
                          SECTION 4.7

                        	
                          POWERS

                        	 	
                          101

                        
	
                          SECTION 4.8

                        	
                          MEETINGS

                        	 	
                          101

                        
	
                          SECTION 4.9

                        	
                          NOTICE
      OF SPECIAL MEETING

                        	 	
                          101

                        
	
                          SECTION 4.10

                        	
                          ACTION
      WITHOUT A MEETING

                        	 	
                          102

                        
	
                          SECTION 4.11

                        	
                          QUORUM
      AND VOTING

                        	 	
                          102

                        
	
                          SECTION 4.12

                        	
                          ORGANIZATION

                        	 	
                          102

                        
	
                          SECTION 4.13

                        	
                          COMPENSATION

                        	 	
                          102

                        
	
                          SECTION 4.14

                        	
                          ATTENDANCE
      BY TELEPHONE

                        	 	
                          102

                        
	 
      	 
      	 	
                           

                        
	
                          ARTICLE 5 OFFICERS

                        	 	
                          102

                        
	
                          SECTION 5.1

                        	
                          OFFICES

                        	 	
                          102

                        
	
                          SECTION 5.2

                        	
                          TERM
      OF OFFICE; VACANCIES

                        	 	
                          102

                        
	
                          SECTION 5.3

                        	
                          REMOVAL
      OF OFFICERS

                        	 	
                          102

                        
	
                          SECTION 5.4

                        	
                          RESIGNATIONS

                        	 	
                          103

                        
	
                          SECTION 5.5

                        	
                          COMPENSATION

                        	 	
                          103

                        
	
                          SECTION 5.6

                        	
                          REFUND
      OF PAYMENT

                        	 	
                          103

                        
	
                          SECTION 5.7

                        	
                          POWERS
      AND DUTIES

                        	 	
                          103

                        


                

              

            

          

        

      

    

      

    Exhibit 6 to Franchise Agreement (Exhibit D of Disclosure Document
033109)

    
      
         


      

      
        Page 94
of 124

        
          

        

      

      
         


      

    

    


    
      
        	
                SECTION 5.8

              	
                DELEGATION
      OF DUTIES

              	
                105

              
	 
      	 
      	 
      
	
                ARTICLE 6 CONTRIBUTIONS

              	
                105

              
	
                SECTION 6.1

              	
                CONTRIBUTIONS

              	
                105

              
	
                SECTION 6.2

              	
                PAYMENT
      OF CONTRIBUTIONS

              	
                105

              
	
                SESTION 6.3

              	
                PAYMENT
      IN PAYMENTS

              	
                105

              
	 
      	 
      	 
      
	
                ARTICLE 7 NOTICES

              	
                105

              
	
                SECTION 7.1

              	
                RECORDING

              	
                105

              
	
                SECTION 7.2

              	
                WAIVER

              	
                105

              
	 
      	 
      	 
      
	
                ARTICLE 8 DESIGNATED FINANCIAL AGENTS, SIGNATURES AND SEAL

              	
                106

              
	
                SECTION 8.1

              	
                DESIGNATED
      FINANCIAL AGENTS

              	
                106

              
	
                SECTION 8.2

              	
                OTHER
      AGREEMENTS

              	
                106

              
	 
      	 
      	 
      
	
                ARTICLE 9 AMENDMENTS OF BYLAWS

              	
                106

              
	 
      	 
      	 
      
	
                ARTICLE 10 INDEMNIFICATION

              	
                106

              
	
                SECTION 10.1

              	
                INDEMNIFICATION
      IN PROCEEDINGS OTHER THAN ACTIONS BY, OR IN THE RIGHT OF THE
      CORPORATION

              	
                106

              
	
                SECTION 10.2

              	
                INDEMNIFICATION
      OF PERSONS PARTIES TO A PROCEEDING BY OR IN THE RIGHT OF
      CORPORATION

              	
                107

              
	
                SECTION 10.3

              	
                MANDATORY
      INDEMNIFICATION

              	
                107

              
	
                SECTION 10.4

              	
                AUTHORIZATION
      OF INDEMNIFICATION IS REQUIRED

              	
                107

              
	
                SECTION 10.5

              	
                ADDITIONAL
      CONDITIONS TO INDEMNIFICATION

              	
                107

              
	
                SECTION 10.6

              	
                PREPAYMENT
      OF EXPENSES

              	
                107

              
	
                SECTION 10.7

              	
                INDEMNIFICATION
      DISALLOWED IN CERTAIN CIRCUMSTANCES

              	
                107

              
	
                SECTION 10.8

              	
                NONEXCLUSIVITY

              	
                108

              
	 
      	 
      	 
      
	
                ARTICLE 11 GENERAL PROVISIONS

              	
                108

              
	
                SECTION 11.1

              	
                FISCAL
      YEAR

              	
                108

              
	
                SECTION 11.2

              	
                GENDER
      AND NUMBER

              	
                108

              
	
                SECTION 11.3

              	
                ARTICLES
      AND OTHER HEADINGS

              	
                108

              
	
                SECTION 11.4

              	
                MINUTES,
      BOOKS AND RECORDS OF ACCOUNT

              	
                108

              
	
                SECTION 11.5

              	
                STATUTORY
      CITES

              	
                108

              


      

    

      

    Exhibit 6 to Franchise Agreement (Exhibit D of Disclosure Document
033109)

    
      
         


      

      
        Page 95
of 124

        
          

        

      

      
         


      

    

    


    El Pollo
Loco Unit # ______

    City,
State

    


    BYLAWS
OF

    _______[NAME OF
AREA]_______EL
POLLO LOCO®
RESTAURANT

    ADVERTISING
ASSOCIATION, INC.

    


    ARTICLE
1

    Officers

    


    Section
1.1    Registered and Principal Office

    


    The
initial registered office of the                                                                                                                         
[NAME OF
AREA]  El Pollo Loco®
restaurant Advertising Association, Inc. (the “Corporation”) will be located
at                                                                                                                                                                                                                     
.
The
initial principal office of the Corporation will be located at                                                                                                                                                                                                                                                                                                                                                                                                       
           
           
 .

    


    Section
1.2    Other Offices

    


    The Corporation may have offices at
such other place or places within or without the State of Delaware as the Board
of Directors may from time to tie establish.

    


    Section
1.3    Registered Agent for Service of Process

    


    The Corporation’s Board of Directors
will have the right to designate a registered agent for service of process, who
may be an individual or a corporation.  The registered agent so
designated will serve until a successor is elected by the Board of
Directors.

    


    ARTICLE
2

    
      Powers
and Purposes

    

    


    Section
2.1    Powers

    


    The Corporation will have all of the
powers accorded nonprofit corporations under the Missouri Nonprofit Corporation
Act (the “Act”).  The Corporation will utilize such powers to engage
in any lawful activity which is consistent with its purposes as set forth in the
Articles of Incorporation.

    


    Section
2.2    Purposes

    


    The purposes for which the
Corporation is formed are to establish, maintain, administer and operate a
promotional and advertising fund (the “Fund”) for the benefit of the El Pollo
Loco®
restaurants (“EPL’s”) of its members located in _____________[describe geographic
area]_______________ (the “Association Area”) and to further any and all
purposes consistent with the objectives of the Corporation.

    


    Section
2.3    Use of Trademarks

    


    The Corporation recognizes that its
activities will necessarily involve advertising and promotional programs that
contain the intellectual property rights, including copyrights, trademarks,
service marks, logos, and designs derived from El Pollo Loco, Inc. (the
“Franchisor”).  As such, the Corporation has entered into, or will
enter into, the   [NAME OF AREA] ______El Pollo
Loco®
restaurant Advertising Association Authorization Agreement.

    


    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 96
of 124

        
          

        

      

      
         


      

    

     


    El Pollo
Loco Unit # ______

    City,
State
  

    ARTICLE
3

    Members

    


    Section
3.1    Members

    


    The
members will consist of (a) owners of franchised Restaurants located in the
Association Area operating under valid and effective Franchise Agreements with
Franchisor; and (b) the Franchisor or any of its affiliates, to the extent that
it or any of its affiliates owns or operates any Restaurants located within the
Association Area.

    


    Any
Franchisee who ceases to be a party to any valid and effective Franchise
Agreement with the Franchisor for a El Pollo Loco®
restaurant located in the Association Area, whether due to transfer, expiration
or termination, will automatically cease to be a member of the Corporation, but
will continue to remain liable to the Corporation for past due unpaid
contributions or other amounts payable to the Corporation at the time membership
ceases.  However, if a Franchisee operates under multiple Franchise
Agreements and ceases to be bound by one or more Franchise Agreements, whether
due to transfer, expiration or termination, but continues to be bound by other
Franchise Agreements for Restaurants located in the Association Area, the
Franchisee shall continue to be a member, but its voting rights shall be reduced
to reflect the number of remaining Restaurants that the Franchisee owns in the
Association Area.  Likewise, to the extent the Franchisor or an
affiliate of Franchisor owns or operates one or more Bakery Cafes in the
Association Area and has been a member of the Corporation, and ceases to own or
operate any such Restaurants in the Association Area, then its membership with
respect to such Restaurants will automatically terminate.

    


    In
accordance with the terms of the ________[NAME  OF
AREA]_________El Pollo Loco®
restaurant Advertising Association Authorization Agreement, a representative of
Franchisor shall be entitled to notice of all regular and special meetings of
the Members of the corporation and shall have the right to attend all meetings,
either in person or in any other manner of attendance authorized in these
Bylaws.  However, unless the Franchisor is a Member of the Corporation
by virtue to vote at a meeting of the Members in accordance with Section 3.12 of
these Bylaws.

    


    Section
3.2    Enrollment

    


    Notwithstanding
any of the foregoing, no person will be enrolled as a Member of the Corporation
nor will it have any rights as a Member unless and until it has signed a
Membership Agreement with the Corporation.  Notwithstanding the
foregoing, Members shall be required to make contributions as required by their
Franchise Agreements, regardless of whether they have signed Membership
Agreements.

    


    Section
3.3    Entity Membership

    


    For all
membership purposes, any business entity (corporation, partnership, limited
liability company, etc.), together with its owners, is deemed a single
Member.

    


    Section
3.4    Members in Good Standing

    


    A Member
will be in good standing as long as:  (a) the Member is not delinquent
in the payment of any contribution or other monetary obligation to the
Corporation; and (b) Member shall not have received a notice of default from
Franchisor with respect to one or more Restaurants located in the Association
Area which default remains uncured to the satisfaction of
Franchisor.  Loss of good standing will not relieve the Member of the
obligation to make contributions, when due.

    


    Section
3.5    Annual and Quarterly Meetings of the
Members

    


    The
annual meeting of the Members shall be held for the election of directors,
consideration and approval of the succeeding year’s advertising budget and the
transaction of such other business as may properly come before the
meeting.  The annual meeting will be held at such time within the
first quarter of the Corporation’s fiscal year as the Board of Directors may
determine.  Quarterly meetings of the Members shall be held for
consideration and approval of advertising and promotional programs and the
transaction of such other business as may properly come before the
meeting.  In addition, at the final quarterly meeting of the fiscal
year, the Members shall consider and approve the level(s) of Member
contributions for the succeeding fiscal year.  Quarterly meetings will
be held at times within the second, third and fourth quarters of the
Corporation’s fiscal year as the Board of Directors may determine.

      

    Exhibit 7 to Franchise Agreement (Exhibit D of Disclosure Document
033109)

    
      
         


      

      
        Page 97
of 124

        
          

        

      

      
         


      

    

    
        


      El Pollo
Loco Unit # ______

      City,
State
   


    The notice of annual or quarterly
meetings of Members, except as otherwise required by law, need not state the
matters to be considered at such meetings.

    


    Section
3.6    Special Meetings

    


    Special meetings of the Members, for
any purpose or purposes, unless otherwise prescribed by applicable law, may be
called on the written request of (i) a majority of the Board of Directors, or
(ii) Members constituting 25% of the voting rights of the Members in good
standing, or (iii) Franchisor.  Requests for a special meeting must
state the purpose or purposes of the proposed meeting.

    


    The
notice of any special meeting of the Members must state the purpose or purposes
for which the meeting is called.

    


    Section
3.7    Place of Meeting

    


    All meetings of the Members will be
at such places as will be determined from time to time by the Board of Directors
of the Corporation.

    


    Section
3.8    Notice of Meetings

    


    Written notice of each meeting of the
Members stating the Place, day and hour thereof, must be delivered to each
Member of record entitled to vote at such meeting, personally or by telephone,
telegram, cablegram, e-mail, first class mail, confirmed facsimile transmission
or any other means of personal delivery providing evidence of actual delivery;
and if mailed, the notice shall be deemed to be given when deposited in the
United States mail addressed to the Members at the Members’ addresses, as they
appear in the records of the Corporation, with postage thereon prepaid. Notice
must be given by or under the direction of the Secretary, or the officer or
persons calling the meeting not more than sixty (60) not less than ten (10) days
before the date of the meeting; provided that oral notice to the Member may be
given in lieu of written notice so long as the party giving the notice to the
Member files with the Corporation a written statement of the date, time, place
and manner of the oral notice.  No notice need be given of the time
and place of reconvening of any adjourned meeting, if the time and place to
which the meeting is adjourned are announced at the adjourned
meeting.

    


    Section
3.9    Waiver of Notice

    


    A written
waiver of notice signed by any Member, whether before or after any meeting,
shall be equivalent to the giving of timely notice to said
Member.  Attendance of a Member at a meeting shall constitute a waiver
of notice of such meeting and waiver of any and all objections to the place of
the meeting, the time of the meeting, or the manner in which it has been called
or convened, except when a Member attends a meeting for the express purpose, as
stated at the beginning of the meeting, of objecting to the transaction of
business because the meeting is not lawfully called or
convened.  Neither the business to be transacted at, not the purpose
of, any meeting of the Member need be specified in any written waiver of
notice.

    


    Section
3.10    Closure of Books and Fixing of Record
Date

    


    For the purpose of determining
Members entitled to notice of, or to vote at, any meeting of the Members or any
adjournment thereof, the Board of Directors may provide that the books will be
closed for a period of not less than three (3) and not more than thirty (30)
days immediately preceding such meeting.  If the books are not closed
and no record date is fixed by the Board of Directors, the date on which notice
of the meeting is mailed will be the record date for the determination of
Members entitled to notice and to vote.

      

    Exhibit 7 to Franchise Agreement
(Exhibit D of Disclosure Document 033109)

    
      
        
        

      

      
        Page 98
of 124

        
          

        

      

      
        
        

      

    

    
        

      El Pollo
Loco Unit # ______

      City,
State

        

    

    Section
3.11    Quorum

    


    Except as
otherwise required by the Act, the Articles of Incorporation or these Bylaws,
the presence of Members holding a majority of the votes will constitute a quorum
at all meetings of the Members.  In case a quorum is not present at
any meeting, a majority of the Members present will have the power to adjourn
the meeting from time to time, without notice other than announcement at the
meeting of the time and place to which the meeting is adjourned, until a quorum
is present.  At any such adjourned meeting at which a quorum is
present, any business may be transacted which might have been transacted at the
meeting as originally noticed; but only those Members entitled to vote at the
meeting as originally noticed will be entitled to vote at any adjournment or
adjournments thereof.

    


    Section
3.12    Voting

    


    Each
Member will be entitled at each Members’ meeting and upon each matter presented
at such meeting to one vote for each El Pollo Loco®
restaurant located in the Association Area that the Member owns, or, in the case
of Franchisor, owns or operates.  Notwithstanding the fixing of the
record date in Section 3.10, Members may only participate in and vote at
meetings subject to being in good standing, in accordance with the Bylaws, both
on the record date and at the time of the meeting.  Furthermore, in
the event that a meeting is postponed or continue, a Member must be in good
standing at the time the meeting is reconvened in order to participate and vote
at the meeting.

    


    Any
Member who is not in good standing pursuant to Section 3.4(a) hereof shall have
all rights and privileges of membership (including the right to vote and
participate as a Member, director or officer in any meeting)
suspended.  Any Member who is not in good standing pursuant to Section
3.4(b) hereof shall have its right to vote (but not its right to participate)
suspended at any meeting of the members or the board of directors of the
Corporation.  Any dispute regarding the good standing of a Member and
its right to vote at a membership meeting will be determined conclusively by the
Chairman of the meeting, in conjunction with the representative of the
Franchisor present at the meeting, which determination will be final and
binding.  Any such suspension shall continue until the Member is in
good standing again.

    


    The list
of Members must be produced at any Member’s meeting upon the request of any
Member.  Upon the demand of any Member, the note upon any question
before the meeting must be by written ballot.  Except as otherwise
provided by these bylaws, by the Act, or by the Articles of Incorporation, all
matters will be decided by a majority of the votes of Members present at the
meeting.  There is no cumulative voting for directors or on any other
matter.

    


    Section
3.13    Representatives

    


    If a
Member is a corporation, limited liability company, partnership or other
business entity, the Member will duly authorize one (1) person to represent its
interests at Association meetings (the “Representative”).  The
Representative must be a:  (i) shareholder, partner, member (in case
of an LLC), director or officer of the Member; or (ii) the Member’s Operating
Partner, as defined in the Member’s Franchise Agreement; or (iii) in the event
the Member is Franchisor or one of its affiliates, an officer or other
designated representative of Franchisor or its affiliate. The Corporation shall
be entitled to rely on any written authorization appointing the Representative
that the Corporation in good faith believes to be valid unless and until the
Corporation shall have received an authorization for a successor Representative
that the Corporation in good faith believes to be valid.   The
Corporation shall be entitled to rely on the Representative’s decisions, votes
and consents to bind the Member at any such meting without any further inquiry.
The same person can be a Representative for more than one (1)
Member.

    


    Section  3.14    Action
Without Meeting

    


    Any
action of the Members of the Corporation may be taken without a meeting, without
prior notice and without a vote, if one or more consents in writing, setting
forth the action so taken, are signed by the Members having not less than
two-thirds (2/3) of the votes that would be necessary to authorize or take such
action at a meeting at which all Members entitled to vote thereon were present
and voted.  Such consents must be delivered to the Corporation in the
manner required by the Act.  Neither the Articles of Incorporation nor
these Bylaws will be construed, interpreted or deemed to have, in any way,
limited or prevented the utilization of the ability to take written action in
lieu of formal meetings as may be permitted by the Act.

      

    Exhibit 7 to Franchise Agreement (Exhibit D of Disclosure Document
033109)

    
      
         


      

      
        Page 99
of 124

        
          

        

      

      
         


      

    

    


    El Pollo
Loco Unit # ______

    City,
State

    


    Section
3.15    Organization

    


    Meeting
of the Members must be presided over by the President, or if he is not present,
by the Vice President, if a Vice President has been elected, or if neither the
President not the Vice President is present, then by a chairman to be chosen by
a majority of the Members entitled to vote who are present in person at the
meeting.  The Secretary of the Corporation, or in his absence, the
Assistant Secretary, will act as secretary of every meeting, but if neither is
present, the Members entitled to vote who are present in person may choose any
person present to act as secretary of the meeting.

    


    At all meetings of the Members the
order of business will be as follows:

    


    
      	
               
      

            	
              (1)

            	
              Calling
      meeting to order.

            


    

    
      	
               
      

            	
              (2)

            	
              Proof
      of notice of meeting and determination of
  quorum.

            


    

    
      	
               
      

            	
              (3)

            	
              Reading
      and disposing of minutes of previous
meeting.

            


    

    
      	
               
      

            	
              (4)

            	
              Announcement
      of purposes for the meeting.

            


    

    
      	
               
      

            	
              (5)

            	
              Reports
      of officers.

            


    

    
      	
               
      

            	
              (6)

            	
              Unfinished
      business.

            


    

    
      	
               
      

            	
              (7)

            	
              New
      business, including election of directors if an annual
      meeting.

            


    

    
      	
               
      

            	
              (8)

            	
              Adjournment.

            


    

    


    Section
3.16    Member Meetings by Telephone

    


    Any Member may participate in a
Members’ meeting, or may conduct a Members’ meeting through the use of, any
means of communication enabling all persons participating in the meeting to hear
each other at the same time during the meeting.  Participating by such
means will constitute presence in person at a meeting.

    


    ARTICLE
4

    Directors

    


    Section
4.1    Number

    


    There will be at least three (3)
directors on the Board.  From time to time, the exact number of
directors may be determined by vote of the Members at any time, but never less
than three (3) and never an amount less than as otherwise required by the
Act.

    


    Section
4.2    Vacancies

    


    Whenever
a vacancy occurs on the Board of Directors, including a vacancy resulting from
an increase in the number of directors or the removal of one (1) or more
directors, it may be filled by the affirmative vote of a majority of the
remaining directors even if the remaining directors constitute less than a
quorum.

    


    Section
4.3    Removal of Directors

    


    Any director may be removed with or
without cause by vote of a majority of the Members at a membership meeting, or
by written action in lieu of meeting signed by the Members having not less than
two-thirds (2/3) of the votes that would be necessary to authorize or take such
action at a meeting at which all Members entitled to vote thereon were present
an voted.

         

    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 100
of 124

        
          

        

      

      
         


      

    

     

    El Pollo
Loco Unit # ______

    City,
State

    


    Section
4.4    Qualification

    


    Each director must be either a Member
(if the Member is an individual) or the Member’s Representative.  If
there are less than three (3) Members at any time, then the franchisor, through
Franchisor’s representative designated as its “Member’s Representative”, shall
have the right to designate two (2) directors one of which shall be the Member’s
Representative and the other shall be an officer of
Franchisor.  However, any director serving on the Board of Directors
will be automatically suspended at any time during which he or she, or the
business organization for which he or she is the Representative, is not in good
standing.  In addition, directors will be automatically removed as
directors if, at any time, the Member with which they are associated is expelled
from membership or is no longer a franchise of the Franchisor either because the
Franchise Agreement has expired or it has been terminated or
transferred.

    


    Section
4.5    Terms

    


    Directors will hold office until
their respective successors are duly elected and qualified or until there is a
decrease in the number of directors.

    


    Section
4.6    Resignation

    


    Any director may resign at any
time.  Such resignation will be made in writing and will take effect
upon its delivery to the President or the Board of Directors or its
Chairman.

    


    Section
4.7    Powers

    


    Except
for those rights reserved to the Members under these bylaws, the business of the
Corporation will be managed by its Board of Directors, which may exercise all
such powers of the Corporation and do all such lawful acts and things as are not
prohibited by the Act, by the Articles of Incorporation or by these
Bylaws.  The Board of Directors will determine the compensation, if
any, to be paid to each officer and director of the Corporation, including those
officers who may also be directors.

    


    Section
4.8    Meetings

    


    The Board of Directors of the
Corporation may hold meetings, whether annual or special, either within or
without the State of Missouri, The annual meeting of the Board of Directors for
the purpose of electing officers and transacting such other business as may be
brought before the meeting will be held at such time and place as the Board of
Directors may determine.  The Board of Directors may by resolution
provide for the time and place of other regular meetings, and no notice of such
regular meetings need to be given.

    


    All other meetings of the Board may
be called on the written request of (i) any director or (ii) Members with 25% of
the voting rights of Members in good standing, at such time and place as may be
stated in such request.

    


    In accordance with the terms of the
___[NAME OF AREA]_ El
Pollo Loco®
restaurant Advertising Association Authorization Agreement, a representative of
Franchisor shall be entitled to notice of all regular an special meetings of the
Board of Directors of the Corporation and shall have the right to attend all
meetings, either in person or in any other manner of attendance authorized in
these Bylaws.  However, unless the Franchisor is a Director of the
Corporation, the Franchisor representative shall have no right to participate in
any action of the Board of Directors in accordance with Sections 4.10 and 4.11
of these Bylaws.

    


    Section
4.9    Notice of Special Meetings

    


    Written notice of the place, day and
hour of any special meeting of the Board of Directors must be given by or under
direction of the Secretary, to each director at least two (2) days before the
meeting; provided, however, that oral notice may be given to directors in lieu
of written notice so long as the party giving the notice to the directors files
with the Corporation a written statement of the date, time, place and manner of
the oral notices.  Neither the business to be transacted at, nor the
purpose of, any meeting of the Board of Directors, need be stated in the notice
or waiver of notice of such meeting.

    


    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 101
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    Section
4.10    Action Without a Meeting

    


    Any action required to be taken, or
which may be taken, at a meeting of the Board of Directors may be taken without
a meeting, if a consent in writing, setting forth the action so to be taken, is
signed by all of the directors entitled to vote.  Such consent will
have the same effect as a unanimous vote.

    


    Section 4.11   Quorum
and Voting

    


    At all meetings of the Board, a
majority of the directors then in office will constitute a quorum for the
transaction of business.  The act of a majority of directors present
at a meeting where a quorum is present will be the act of the Board of
Directors, except as may be otherwise specifically provided by law, the Articles
of Incorporation or these Bylaws.  If at any meeting of the Board of
Directors there is less than a quorum present, a majority of those present may
adjourn the meeting, without further notice, form time to time and place to
place until a quorum will have been obtained.

    


    Section
4.12    Organization

    


    The President of the Corporation will
act as Chairman and the Secretary will act as Secretary at all meetings of the
Board.

    


    Section
4.13    Compensation

    


    Directors must not receive any stated
salary for their services as directors or as members of committees, but by
resolution of the Board a fixed fee and /or expenses of attendance may be
allowed for attendance at each meeting.

    


    Section
4.14    Attendance by Telephone

    


    Any member or members of the Board of
Directors will be deemed present and voting at a meeting of the Board if said
member or members participate in the meeting by means of a conference telephone
or other communications equipment enabling all persons participating in the
meeting to hear other at the same time.  Participation by such means
will constitute presence in person at a meeting.

    


    ARTICLE
5

    Officers

    


    Section
5.1    Officers

    


    The officers of this Corporation will
consist of a President, a Secretary and a Treasurer, and may consist of such
other officers, including but not limited to one (1) or more Vice Presidents,
Assistant Secretaries and Assistant Treasurers with such titles, powers and
duties as may be prescribed from time to time by the Board of
Directors.  They will be elected by the Board of Directors at its
annual meeting.

    


    Section
5.2    Term of Office; Vacancies

    


    Each officer shall hold office for
one (1) year and until such officer’s successor is duly elected and
qualified.  A vacancy in any office arising from any cause may be
filled for the unexpired portion of the term by the Board of
Directors.

    


    Section
5.3    Removal of Officers

    


    Any officer may be removed at any
time with or without cause by action of the Board of Directors by the
affirmative vote of a majority of the directors then in
office.  Election or appointment of an officer will not of itself
create contract rights.

    


    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 102
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    Section
5.4    Resignations

    


    An officer may resign at any time by
delivering notice to the Corporation.  A resignation is effective when
the notice is delivered unless the notice specifies a later effective
date.  If a resignation is made effective at a later date and the
Corporation accepts the future effective date, the Board of Directors may fill
the pending vacancy before the effective date if the Board of Directors provides
that the successor does not take office until the effective date of the pending
vacancy.

    


    Section
5.5    Compensation

    


    No compensation will be paid to any
officer of the Corporation, except the Board of Directors may determine a fixed
fee or other reimbursement for expenses.

    


    Section
5.6    Refund of Payment

    


    In the event that the Internal
Revenue Service disallows, in whole or in part, the deduction by the Corporation
as an ordinary and necessary business expense of any payment made to an officer
of the Corporation, whether as salary, commission, bonus or other form of
compensation or as interest, rent or reimbursement of expenses incurred by such
officer, such officer must reimburse the Corporation to the full extent of such
disallowance.  The Board of Directors of the Corporation will have the
duty to require each such officer to make such reimbursement, and it will be the
legal duty of each such officer thus to reimburse the Corporation.

    


    Section
5.7    Powers and Duties

    


    A.       In
General.  The officers of the Corporation will have such powers and
duties as generally pertain to their respective offices, including the powers
and duties provided by these Bylaws, as well as such powers and duties as from
time to time may be conferred by the Board of Directors.

    


    B.       President.  The
President will:

    


    (1)
preside at all meetings of the Board of Directors in the absence of the Chairman
of the Board, if any;

    


    (2)
present at each annual meeting of the directors a report of the condition of the
business of the Corporation;

    


    (3) cause to be called regular and
special meetings of the directors in accordance with these Bylaws;

    


    (4)
jointly with the Treasurer, sign and make contracts and agreements in the name
of the Corporation;

    


    (5) see
that the books, reports, statements and certificates required by statute are
properly kept and filed according to law;

    


    (6)
jointly with the Treasurer, sign notes, drafts or bills of exchange, warrants or
other orders for the payment of money duly drawn on behalf of the
Corporation;

    


    (7) supervise all employees of the
Corporation including the hiring and firing of such employees as he or she deems
advisable; and

    


    (8)
jointly with the Treasurer, purchase on behalf of the Corporation, tangible or
intangible assets; and

    


    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 103
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    (9) have
general charge of and control over the affairs of the Corporation and perform
the entire duties incident to such position and office, the enforcement of these
Bylaws and all other things which the President is required to do by
law.

    


    C.  Vice
President.  The Vice President, if any will;

    


    (1)  in
the absence or disability of the President, perform the duties and exercise the
powers of the President;  and

    


    (2)  perform
such other duties and have such other powers as the Board of Directors may from
time to time prescribe.

    D.  Secretary.  The
Secretary will:

    


    (3)  prepare
the minutes of the meetings of the Board of Directors and keep the minutes in
appropriate permanent books of record;

    


    (4)  give and serve all
notices of the Corporation;

    


    (5)  be
the custodian of the records and of the seal, and affix the latter when
required, and authenticate records of the Corporation when required;
and

    


    (6)  attend to all
correspondence and perform all the duties incident to the office of the
Secretary.

    


    E.  Treasurer.  The
Treasurer will:

    


    (1)  keep
accounts of and have the care and custody of and responsible for all the funds
and securities of the Corporation;

    


    (2)  deposit
all such funds in the name of the Corporation in such back or banks, trust
company or trust companies, or safe deposit vaults as the Board of Directors may
designate;

    


    (3)   exhibit,
at times required by law or these Bylaws, the corporate financial books and
accounts to any director upon application at the office of the Corporation
during business hours;

    


    (4)   render
a statement of the condition of the finances of the Corporation (at each regular
meeting of the Board of Directors, and at such other times as it will be
required of the Treasurer) and a full financial report at the annual meeting of
the directors;

    


    (5)   keep
at the office of the Corporation current books of account of all its business
transactions and such other books of account that the Board of Directors may
require;

    


    (6)   jointly
with the President, sign and make contracts and agreements in the name of the
Corporation:

    


    (7)   jointly with the
President, sign notes, drafts or bills of exchange, warrants or other orders for
thepayment of money duly drawn on behalf of the Corporation;

    


    (8)   jointly
with the President, purchase on behalf of the corporation, tangible or
intangible assets, and

    


    (9)   do and perform all
other duties pertaining to the office of the Treasurer.

    


    F.    Assistant
Secretary and Assistant Treasurer.  The Assistant Secretary or
Assistant Secretaries and the Assistant Treasurer will, in the absence or
disability of the Secretary, or Treasurer, respectively, perform the duties of
such officer and generally assist, in the case of an Assistant Secretary, the
Secretary, or an Assistant Treasurer, the Treasurer.

    


    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 104
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    Section
5.8    Delegation of Duties

    


    In the case of the absence or
disability of any officer of the Corporation or for any other reason deemed
sufficient by a majority of the Board, the Board of Directors may delegate such
officer’s respective powers or duties to any other officer or to any director or
agent of the Corporation for a specified period or until said delegation is
revoked by the Board of Directors, provided that such delegation is otherwise
permitted by law and by the Articles of Incorporation and these
Bylaws.

    


    ARTICLE
6

    Contributions

    


    Section
6.1    Contributions

    


    The Members will determine at the
final quarterly Member meeting of the fiscal year the amount of contributions to
be paid to the Corporation by its Members during the succeeding fiscal
year.  The amount of the contributions will generally be a percentage
of Gross Sales, as defined in the most recent Disclosure Document issued by the
Franchisors, uniform among Members on a per El Pollo Loco®
restaurant basis.  The Members may, subject to Franchisor’s approval,
vary the level of benefits and/or contributions for any El Pollo Loco®
restaurant that is located in a geographical area in which broadcast coverage is
less than eighty-five percent (85%), according to the most recent A.C. Nielsen
or Arbitron coverage study, in order to achieve approximate equivalence in
contributions and benefits of Members.  If any Restaurants of a Member
are located in geographical areas covered, according to the most recent A.C.
Nielsen or Arbitron coverage study, by more than one regional advertising
association, the variation in benefits and/or contribution may be coordinated
with such other regional advertising association.

    


    Section
6.2    Payment of Contributions

    


    Subject to the terms of the
________[NAME OF
AREA]                 El
Pollo Loco®
restaurant Advertising Association Authorization Agreement, the Board of
Directors will set the dates and method of payment for
contributions.  However, Members will not have to pay their
contributions for new Restaurants until after their El Pollo Loco®
restaurant have opened for business.

    


    Section
6.3    Default in Payments

    


    The Board of Directors will establish
policies and procedures for dealing with situations in which Members have not
timely paid contributions.  The Board of Directors may set interest
rates and fees to offset administrative expenses, collection costs, etc. for
delinquent payments.

    


    ARTICLE
7

    Notices

    


    Section
7.1    Recording

    


    Whenever these Bylaws require notice
to be given to Members, directors, or committee members, proof of such notice
whether given by mail, e-mail, telecopy, telephone, telegraph, cablegram or by
personal contact will be recorded and filed by the Secretary in the minute book
and incorporated into the minutes for the meeting to which such notice
pertains.

    


    Section
7.2    Waiver

    


    Whenever any notice of a meeting is
required to be given under the provisions of the Act, of the Articles of
Incorporation, or of these bylaws, a waiver thereof in writing, signed by the
person or persons entitled to such notice either before, at, or after the
meeting, will be deemed equivalent to such required
notice.  Attendance of a person entitled to notice at a meeting will
also constitute a waiver of notice of such meeting; provided, however, that such
attendance will not constitute such a waiver if said person attends said meeting
solely for the purpose of, and limits his participation at the meeting to,
objecting to the transaction of any business because the meeting is not lawfully
called or convened and states such objection at the beginning of the
meeting.

    


    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 105
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    ARTICLE
8

    
      Designated
Financial Agents, Signatures and Seal

    

    


    Section
8.1   Designated Financial Agents

    


    All funds of the Corporation will be
deposited in the name of the Corporation in such bank or other financial
institutions as the Board of Directors may from time to time designate and will
be drawn out on checks, drafts or other order signed on behalf of the
Corporation by such person or persons as the Board of Directors may from time to
time designate.

    


    Section
8.2    Other Agreements

    


    Except as otherwise specifically
provided by these Bylaws, all contacts, agreements, deeds, bonds, mortgages and
other obligations and instruments must be signed on behalf of the Corporation by
the President and Treasurer or by such other officers or agents as the Board of
Directors may from time to time by resolution provide.

    


    ARTICLE
9

    Amendments
of Bylaws

    


    The Bylaws may be altered, amended or
repealed only by the Members at a meeting of Members, provided that the notice
of the meeting contains a written proposal to amend these Bylaws along with the
text of the amendments, and subject to the prior written approval of Franchisor
in accordance with the _______[NAME OF AREA]________El
Pollo Loco®
restaurant Advertising Association Authorization Agreement. Nevertheless, the
amendment of any Bylaw or replacement of these Bylaws will not be effective
unless it has been approved by a voting requirement that is in excess of the
voting requirement that it is replacing.  In other words, voting
requirement specifying approval by two-thirds (2/3) can only be changed by a
vote of at least that number.

    


    ARTICLE
10

    Indemnification

    


    Section
10.1   Indemnification in Proceedings Other Than Actions by, or
in the Right of, the Corporation

    


    The Corporation will indemnify any
person who was or is a party to any proceedings (other than an action by, or in
the right of, the Corporation), by reason of the fact that he or she is or was a
director, officer, employee, or agent of the Corporation, or is or was serving
at the request of the Corporation as a director, committee member, officer,
employee or agent of another corporation, partnership, joint venture, trust, or
other enterprise against liability incurred in connection with such proceeding,
including any appeal thereof, if the indemnitee acted in good faith and in a
manner he reasonably believed to be in, or not opposed to, the best interests of
the Corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.

    


    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 106
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    Section
10.2    Indemnification of Persons Parties to a Proceeding
by or in the Right of the Corporation

    


    The Corporation will indemnify any
person who was or is a party to any proceeding by or in the right of the
Corporation to procure a judgment in its favor by reason of the fact that he or
she is or was a director, officer, employee, or agent of the Corporation or is
or was serving at the request of the Corporation as the director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses and amounts paid in settlement not exceeding,
in the judgment of the Board of Directors, the estimated expense of litigating
the proceeding to conclusion, actually and reasonably incurred in connection
with the defense or settlement of such proceeding, including any appeal
thereof.  Such indemnification may be authorized if such person acted
in good faith and in a manner he or she reasonably believed to be in, or not
opposed to, the best interests of the Corporation.  Provided, however,
that no indemnification may be made hereunder in respect of any claim, issue, or
matter as to which such person has been adjudged to be liable, unless, and only
to the extent that, the court in which such proceeding was brought, or any other
court of competent jurisdiction, determines upon application that, despite the
adjudication of liability, but in view of all circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses which
such court deems proper.

    


    Section
10.3     Mandatory Indemnification

    


    To the extent that a director,
officer, employee or agent of the Corporation has been successful on the merits
or otherwise in defense of any proceeding referred to in Sections 10.0 and 10.2
above, or in defense of any claim, issue or matter therein, he or she must be
indemnified against expenses actually and reasonably incurred by him or her in
connection therewith.

    


    Section
10.4    Authorized of Indemnification is
Required

    


    Any indemnification under Sections
10.1 and 10.2, unless pursuant to a determination by a court, may be made by the
Corporation only as authorized in the specific case upon a determination that
indemnification of the director, officer, employee, or agent is proper in the
circumstances because he or she has met the applicable standard of conduct set
forth in Section 10.1 or 10.2.  Such determination must be made
pursuant to any procedures outlined by the Act, if any.

    


    Section
10.5   Additional Conditions to Indemnification

    


    The Board, by a majority vote of a
quorum consisting of directors who were not parties to the action, suit or
proceeding to which the indemnification relates, may impose such additional
conditions upon any form of indemnification as the Board may deem appropriate,
including, but not limited to, the right to assume the defense in appropriate
circumstances, the right to select the attorney representing the indemnified
person and the right to settle.

    


    Section
10.6    Prepayment of Expenses

    


    Expenses (including attorneys’ fees
and expenses) incurred in defending a civil or criminal action, suit or
proceeding must be paid by the Corporation in advance of the final disposition
of such action, suit or proceeding upon a preliminary determination following
the procedures set forth in Section 10.04 that such indemnified person meets the
applicable standard of conduct referred to therein and subject to any conditions
imposed by the Board pursuant to this Article and the prior receipt by the
Corporation of an undertaking satisfactory in form and substance to the
Corporation that such person will promptly repay such amount unless it is
ultimately determined that the person is entitled to be indemnified by the
Corporation as authorized in this Article 10.

    


    Section
10.7  Indemnification Disallowed in Certain Circumstances

    


    The indemnification provided pursuant
to this article may not be made to or on behalf of any director, officer,
employee, or agent if a judgment or other final adjudication establishes that
his or her actions, or omissions to act, were material to the cause of action so
adjudicated and constitute:

    


    A.  a
violation of the criminal law, unless the director, officer, employee or agent
had reasonable cause to believe his or her conduct was lawful or had no
reasonable cause to believe his or her conduct was unlawful;

    


    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 107
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    B.   a
transaction from which the director, officer, employee or agent directly or
indirectly derived an improper personal benefit;

    


    C.   in
the case of a director, a circumstance under which the director would be liable
to the Corporation under the Act; or

    


    D.   willful
misconduct or a conscious disregard for the best interests of the Corporation in
a proceeding by or in the right of the Corporation to procure a judgment in its
favor.

    


    Section
10.8    Nonexclusively

    


    The Corporation has the power to make
any other or further indemnification of any of its directors, officers, members
of any committee, or any other person that the Corporation has the power by law
to indemnify, including without limitation, employees or agents of the
Corporation, under any bylaw, agreement, vote of disinterested directors, or
otherwise, both as to action in any official capacity and as to action in
another capacity while holding such office, except an indemnification against
gross negligence or willful misconduct.  The indemnification as
provided in this Article will continue as to any person who has ceased to be a
director, officer, or agent and will insure to the benefit of such person’s
heirs and personal representatives.

    


    ARTICLE
11

    General
Provisions

    


    Section
11.1    Fiscal Year

    


    The fiscal year of the Corporation
shall be either fifty-two (52) or fifty-three (53) weeks and end on the last
Saturday in December of each year.

    


    Section 11.2   Gender
and Number

    


    Whenever the context requires, the
gender of all words used herein includes the masculine, feminine and neuter, and
the number of all words includes the singular and plural thereof.

    


    Section
11.3    Articles and Other Headings

    


    The Articles and other headings
contained in these Bylaws are for reference purposes only and will not affect
the meaning or interpretation of these Bylaws.

    


    Section
11.4    Minutes, Books and Records of Account

    


    The Corporation will keep correct and
complete books and records of account and will keep minutes of the proceedings
of its Board of Directors and other records as required by the Act.

    


    Section
11.5    Statutory Cites

    


    Any reference in these Bylaws to the
Act will include all revisions and amendments to the Act.

    


    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 108
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    EXHIBIT
7 TO FRANCHISE AGREEMENT

    


    EL
POLLO LOCO®
FINANCIAL REPORTING FORM

    


    You will
be required to submit quarterly and year-end financial statements electronically
in the following format. The financials should be comparative showing the prior
year amounts for the same periods. There should be columns for both the recently
completed quarter and a Year-to-date column, if applicable. Do not include
officer’s salary, auto expenses, or any other above restaurant expenses should
not be included.

    


    
      
        
          
            	 
      	 	
                    Amount

                  	 	 	
                    %

                  	 
	 
      	 	 	 	 	 	 
	
                    Gross
      Sales

                  	 	$	0	 	 	 	 
	 
      	 	 	 	 	 	 	 
	
                    Net  Sales

                  	 	 	0	 	 	 	100.0	%
	 
      	 	 	 	 	 	 	 	 
	
                    Food
      Cost

                  	 	 	0	 	 	 	0.0	%
	
                    Paper
      Cost

                  	 	 	0	 	 	 	0.0	%
	
                    Total  Food
      & Paper

                  	 	 	0	 	 	 	0.0	%
	
                    Gross
      Profit

                  	 	 	0	 	 	 	0.0	%
	 
      	 	 	 	 	 	 	 	 
	
                    Hourly
      and Manager labor

                  	 	 	0	 	 	 	0.0	%
	
                    Fringe
      Benefits (a)

                  	 	 	0	 	 	 	0.0	%
	
                    Total
      Labor

                  	 	 	0	 	 	 	0.0	%
	 
      	 	 	 	 	 	 	 	 
	
                    Utilities

                  	 	 	0	 	 	 	0.0	%
	
                    Repair
      and Maintenance

                  	 	 	0	 	 	 	0.0	%
	
                    Cash
      Over/Short

                  	 	 	0	 	 	 	0.0	%
	
                    Controllable
      Costs (b)

                  	 	 	0	 	 	 	0.0	%
	
                    Restaurant
      Controllable Profit

                  	 	 	0	 	 	 	0.0	%
	 
      	 	 	 	 	 	 	 	 
	
                    Advertising

                  	 	 	0	 	 	 	0.0	%
	
                    Royalties

                  	 	 	0	 	 	 	0.0	%
	
                    Indirect
      Costs (c )

                  	 	 	0	 	 	 	0.0	%
	
                    Occupancy
      Costs (d)

                  	 	 	0	 	 	 	0.0	%
	 
      	 	 	 	 	 	 	 	 
	
                    Restaurant
      Operating Profit

                  	 	$	0	 	 	 	0.0	%


          

        

      

    

    


    
      	
            	
              (a)

            	
              To
      include payroll taxes, health benefits, vacation, and workers compensation
      expense

            


    

    
      	
            	
              (b)

            	
              To
      include trash, store security, uniforms, laundry, cleaning/janitorial,
      operating supplies, music and plant service, landscape, and other misc.
      restaurant costs not captured
elsewhere.

            


    

    
      	
            	
              (c)

            	
              To
      include credit card fees, bank charges, licenses, permits, fees, and
      pre-opening costs

            


    

    
      	
            	
              (d)

            	
              To
      include minimum and percentage rent, property taxes and
      insurance.

            


    

    


    Exhibit 7
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 109
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    EXHIBIT
8 TO FRANCHISE AGREEMENT

    


    IT
SUPPORT SERVICES AGREEMENT

    


    
      
        	
                Customer:

              	 
      
	 
      	 
      
	
                Located
      at (principal place of business):

              	 
      
	 
      	 
      
	
                Franchise
      Store Number(s) Covered:

              	 
      
	 
      	 
      
	
                El
      Pollo Loco IT:

              	 
      
	 
      	 
      
	
                Located
      at (principal place of business):

              	 
      
	 
      	 
      
	
                Effective
      Date:

              	 
      
	 
      	 
      
	
                Customer’s
      Authorized Representative(s)/Contacts:

              	 
      
	 
      	 
      
	
                Notices,
      if to Customer, to be sent to:

              	 
      
	 
      	 
      
	
                Invoices
      to Customer to be sent to:

              	 
      
	 
      	 
      
	
                Notices,
      if to El Pollo Loco IT, to be sent to:

              	 
      
	 
      	 
      
	
                Customer
      Site(s):

              	 
      
	 
      	 
      
	
                Term
      Commencement Date:

              	 
      
	 
      	 
      
	
                Term
      Expiration Date:

              	 
      
	 
      	 
      
	
                Service
      Level (Platinum or Gold):

              	 
      
	 
      	 
      
	
                Service
      Level Description

              	
                See
      Attached EPL IT Standard Platinum & Gold Service
      Descriptions

              
	 
      	 
      
	
                Annual
      Fees:

              	
                See
      Attached Franchise Support Options

              
	 
      	 
      
	
                Special
      Terms:

              	 
      


      

    

     

    The
authorized representatives of Customer and El Pollo Loco agree to the terms and
conditions of this Agreement, including without limitation documents
incorporated by reference, as of the Effective Date.

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	
                                      El
      Pollo Loco

                                    	 
      	
                                      Customer:

                                    
	 
      	 
      	 
      
	
                                      Signature:

                                    	 
      	 
      	
                                      Signature:

                                    	 
      
	 	 	 	 	 
	
                                      Printed Name: 

                                    	 
      	 
      	
                                      Printed Name: 

                                    	 
      
	 	 	 	 	 
	
                                      Title:

                                    	 
      	 
      	
                                      Title:

                                    	 
      
	 	 	 	 	 
	
                                      Date:

                                    	 
      	 
      	
                                      Date:

                                    	 
      


                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    Exhibit 8
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 110
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

     

    TERMS AND
CONDITIONS

    


    1.           Performance.  El
Pollo Loco Informational Technology (“EPL IT”) shall make available to Customer
certain operations support services for the Service Level designated on the
first page of this Agreement (“Services”) based on EPL IT’s standard description
of services for such Service Level in accordance with the terms and conditions
of this Agreement.  Should Customer leave the Service Level blank on
the preceding page, EPL will assume the Service Level to be
Platinum.  The Services are limited to the standard EPL franchise
store configuration unless otherwise agreed upon in writing by EPL IT (“Standard
Store Configuration”).  Unless otherwise expressly provided in the EPL
IT’s standard description of services for the applicable Service Level, all
Services will be provided during EPL IT’s normal business hours (9:00 am to 5:00
pm Pacific Time, Monday through Friday) excluding EPL IT’s published holidays
and scheduled downtimes for maintenance and support.  EPL IT reserves
the right to restrict access to the Services during periods of routine back-up,
maintenance and other activities outside such normal business
hours.

    2.           Customer
Obligations.  As a condition precedent to EPL IT performing its
obligations hereunder, and in addition to Customer's other obligations as set
forth in EPL IT’s standard description of services for the applicable Service
Level, Customer shall timely provide the following, on a timely basis and at no
charge to EPL IT:  (a) access to and use of reasonable working space,
facilities and utilities, (b) any information, software, equipment, data and/or
documentation (collectively, “Data”) that EPL IT reasonably requests from
Customer that is necessary for EPL IT to properly perform its obligations
hereunder; and (c) all components in the Standard Store Configuration and all
updates, enhancements, upgrades and replacements thereto recommended or
otherwise identified in writing by EPL IT.  Customer represents to EPL
IT that it has the right to grant EPL IT access to such facilities and Data for
the performance of the Services.  Such Data shall be kept confidential
by EPL IT in accordance with Section 4.  In the event that there are
any delays by Customer in the timely providing of facilities, access, Data, or
the Standard Store Configuration or there are errors or inaccuracies in the Data
or the Standard Store Configuration provided, and such delays, errors or
inaccuracies require additions, corrections or modifications related to EPL IT's
performance hereunder, then any costs associated therewith shall be the
responsibility of Customer, and EPL IT shall be entitled to appropriate
adjustments. Customer shall designate two points of contact who shall be the
only people to make inquiries to EPL IT under this Agreement, as set forth on
the first page of this Agreement. Each Customer contact must possess, or at
Customer’s expense acquire the necessary familiarity, expertise and training on
the Standard Store Configuration with direction by EPL IT.  Prior to
requesting support, Customer will comply with all published operating and
troubleshooting procedures for the components of the Standard Store
Configuration and, if such efforts are unsuccessful in eliminating the
malfunction, Customer shall promptly notify EPL IT of any problems discovered in
the operation of the Standard Store Configuration.  Customer must
identify the Franchise Store  Number when accessing the
Services.  Customer must cooperate with EPL IT to maintain a site
activity log. Customer will perform routine preventive maintenance and cleaning
of the Standard Store Configuration Customer shall be solely responsible for the
accuracy of all Data collected and submitted to third party suppliers for credit
card processing. Customer shall comply with such reasonable policies, procedures
and rules relating to the Services as EPL IT may from time to time publish on
its website or designate in writing to Customer.  Customer shall make
all efforts to educate and train their restaurant managers in how to run their
point of sales.  Customer will ensure that all third parties,
including its employees or contractors, using the Services or any components of
Customer’s Standard Store Configuration abide by Customer’s obligations under
this Agreement in their use thereof.  Any act or omission of any third
party related to Customer’s obligations hereunder or the use of any Services,
Reports or Standard Store Configuration shall be deemed to be the act or
omission of Customer for all purposes whether or not Customer had knowledge of
or had authorized such act or omission.

    


    Exhibit 8
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 111
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    3.           Price and Payment
Terms.  In consideration for the Services performed pursuant to
this Agreement, Customer shall pay EPL IT based upon the fees specified on the
first page of this Agreement (“Fees”).  Such Fees shall cover 12
months of services from the term commencement date set forth on the first page.
EPL IT reserves the right to increase the Fees annually for the next 12 month
period by providing Customer with thirty (30) days prior written notice setting
forth the adjustment to the Fees.  The Fees for the initial 12 months
shall be due based upon the term specified on the first page of this agreement
(“TERMS”).  EPL IT shall automatically debit the Customer’s account
via ACH funds transfer in accordance with the fee’s and terms indicated on the
first page of this agreement.  The first installment is due and
payable on the first day of this agreement.  Subsequent payments or
account ACH funds transfers will be made according to the schedule specified
under term (“TERMS”) indicated on the first page of this agreement. Reasonable
and properly documented out-of-pocket travel and living expenses incurred by EPL
IT personnel during their performance of the Services shall be reimbursed by
Customer at the actual costs incurred by EPL IT, subject to any limitations on
the first page of this Agreement.  In the event that EPL IT, or their
designated representative, provides services, which it determines, in its
reasonable discretion, to be outside the scope of the Services which would
include, but is not limited to, software license fees, hardware updates
associated with software updates, Customer shall be timely in paying invoices at
the Professional service rates described under Complete I.T. Operations Support
plus materials charges incurred in the performance of such services or if an
outside designated representative is used, at the rate they charge plus
materials charges incurred in the performance of such
services.  Invoices for any services performed outside the scope of
EPL IT’s standard description of services for the applicable Service Level and
travel and living expenses incurred shall be submitted to Customer by EPL IT on
a monthly basis.  Customer may not withhold or set off any amounts
due. Customer shall have the right, but not the obligation, to upgrade the
Services from Gold Support to Platinum Support, by notifying EPL
IT  in writing, and paying the applicable Fees in full applicable to
upgrade the Service Level.  All sums payable to EPL IT shall be made
in United States dollars and due thirty (30) days from the date of EPL IT's
invoice.  All amounts past due shall accrue interest from their due
dates at the rate of one and one-half percent (1.5%) per month or the maximum
percentage allowable by law (whichever is less).  All amounts due
(including the Fees) do not include any federal, state or local sales, use or
excise taxes or other charges assessed against or payable by EPL IT in
connection with this Agreement, and Customer shall pay to EPL IT the amount of
any such taxes that EPL IT may be required to pay on account of its performance
under this Agreement except for any franchise tax or tax based upon EPL IT's net
income or personal property.  EPL IT reserves the right to cease
performance without prejudice and assert appropriate liens if all mounts are not
paid in full when due.

    4.           Confidential &
Proprietary Information.  Each party shall maintain in strict
confidence, and not disclose or distribute to any third person any Confidential
Information of the other party for a period of three (3) years from the date of
disclosure (except with respect to trade secrets, which shall be kept
confidential until no longer qualifying as a trade secret). “Confidential
Information” shall mean the information disclosed by either party pursuant to
this Agreement that is (a) stamped or otherwise marked as being confidential by
the disclosing party, (b) if disclosed in oral form, identified as confidential
at the time of oral disclosure and is summarized by the disclosing party in a
written memorandum marked as confidential and delivered within ten (10) business
days after such disclosure, or (c) of such a nature as to put a reasonable party
on notice as to the confidentiality of the information disclosed. Confidential
Information does not include any information that: (i) entered the public domain
through no fault of the receiving party; (ii) is rightfully received by the
receiving party from a third party without similar non-disclosure obligations;
(iii) is already known to the receiving party prior to disclosure by the
disclosing party; (iv) is independently developed by the receiving party without
reference to the Confidential Information of the disclosing party, or (v) is
required to be disclosed by law, provided that the party intending to make such
required disclosure shall promptly notify the other party of such intended
disclosure in order to allow such party to seek a protective order or other
remedy. The obligations set forth above in this Section shall not affect EPL
IT's ownership of Inventions (as defined in Section 5) and all intellectual
property rights therein, or EPL IT's full exercise of those Inventions and
intellectual property rights, so long as EPL IT does not disclose Customer's
Confidential Information.  All Inventions shall constitute EPL IT’s
Confidential Information.

    5.           Proprietary
Rights.  EPL IT or its subcontractors, as applicable, retain
sole ownership of all designs, engineering details, data, methodologies, ideas,
concepts, discoveries, inventions, improvements, works of authorship, technology
or information. and all enhancements, modifications and derivative works thereof
(collectively, “Inventions”), and all intellectual property rights therein, used
or created by EPL IT or such subcontractors in the performance of the Services,
and shall have the exclusive right to determine how to protect the
Inventions.  Reports or other work product delivered by EPL IT to
Customer under this Agreement are provided to Customer with Limited
Rights.  “Reports” means the written reports or work product
specifically produced by EPL IT in performing the Services and specified to be a
item delivered to Customer.  “Limited Rights” means the right of
Customer to use the Reports in operating Customer’s Standard Store Configuration
for Customer’s own internal business purposes only, but in no event the right to
make copies, modifications, enhancements or derivative works thereof or resell
or sublicense such Reports or any portion thereof.  EPL IT retains for
itself, its parent company, affiliates and subsidiaries, the right to retain and
make copies of the Reports and to make use of the contents thereof for its and
their business use and, as to any portion of such contents that is not
Customer’s Confidential Information, to make use thereof for any purpose,
whether internal or otherwise.

    


    Exhibit 8
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 112
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    6.           Limited
Warranty.  EPL IT warrants to Customer only
that:  (i) for a period of thirty (30) days from the date of
completion of its performance of a particular task under the Services, the
particular task will be performed in a good and workmanlike manner consistent
with standard industry practices employed by persons knowledgeable in the field
of computers and within the limits of the technology embodied in the Standard
Store Configuration; and (ii) for a period of thirty (30) days from the date of
delivery of a particular Report, that Report will be free from material defects
in workmanship and materials, and will conform in all material respects to the
applicable descriptions or specifications provided by EPL IT to
Customer  In the event of a breach by EPL IT of the foregoing warranty
of which Customer notifies EPL IT in writing during the warranty period, EPL IT'
sole obligation and Customer’s exclusive remedy shall be for EPL IT to use
commercially reasonable efforts to re-perform the task or to correct the portion
of the Report that does not conform to such warranty.  In the event
EPL IT is unable to re-perform such task or to make such corrections, as
applicable, the sole remedy of Customer and EPL IT' sole obligation shall be to
recover the compensation actually paid to EPL IT for the Service or the Report
giving rise to such warranty failure.  This limited warranty with
respect to any Services or Reports shall be voided in the event Customer: (i)
makes additions to, alters, modifies, enhances, changes, repairs or disassembles
the Standard Store Configuration, or fails to maintain the Standard Store
Configuration (or any component thereof or any equipment or facilities upon
which such component depends) in good working order or the environmental
conditions within the operating range specified by the manufacturer of the
components in the Standard Software Configuration or EPL IT; (ii) uses the
Standard Store Configuration or any Report in a manner for which it was not
designed, or in an incompatible operating environment; or (iii) mishandles,
abuses, misuses or damages the Standard Store Configuration.  THE
LIMITED WARRANTY STATED IN THIS SECTION AND THE REMEDIES FOR A FAILURE OR BREACH
OF SUCH LIMITED WARRANTY ARE EXCLUSIVE.  THEY ARE GIVEN TO CUSTOMER IN
LIEU OF ALL OTHER WARRANTIES, WRITTEN OR ORAL, STATUTORY, EXPRESS OR IMPLIED,
INCLUDING WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE, TITLE, ACCURACY, QUIET ENJOYMENT, NON-INFRINGEMENT, OR
COURSE OF PERFORMANCE OR DEALING, WHICH EPL IT SPECIFICALLY
DISCLAIMS.

    7.           Limitation of
Damages. IN NO EVENT SHALL EPL IT (OR ITS SUPPLIERS) BE LIABLE TO
CUSTOMER FOR LOST PROFITS, LOSS OR INTERRUPTION OF BUSINESS, LOSS OF DATA OR ANY
SPECIAL, INCIDENTAL, EXEMPLARY, PUNITIVE, CONSEQUENTIAL OR OTHER DAMAGES,
HOWEVER CAUSED, AND WHETHER BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE) OR
ANY OTHER THEORY OF LIABILITY.  THE FOREGOING LIMITATION SHALL APPLY
EVEN IF EPL IT (OR ITS SUPPLIERS) KNOW OR HAVE BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGE AND NOTWITHSTANDING ANY FAILURE OR ESSENTIAL PURPOSE OF ANY
LIMITED REMEDY PROVIDED FOR HEREIN.  EXCEPT IN RESPECT OF INJURY TO OR
DEATH OF ANY PERSON RESULTING FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
EPL IT, ITS EMPLOYEES, AGENTS OR SUBCONTRACTORS (FOR WHICH NO LIMIT APPLIES), IN
NO EVENT WILL EPL IT'S ENTIRE LIABILITY UNDER THIS AGREEMENT EXCEED THE GREATER
OF (A) THE FEES PAID TO EPL IT UNDER THIS AGREEMENT OR (B)
$5,000.00.  IN NO EVENT SHALL EPL IT HAVE ANY LIABILITY FOR ANY
COMPONENT OF THE STANDARD STORE CONFIGURATION.  IN ADDITION, EPL IT
SHALL NOT BE LIABLE UNDER ANY CLAIM BROUGHT UNDER ANY THEORY OF LAW THAT AROSE
MORE THAN ONE (1) YEAR PRIOR TO THE INSTITUTION OF SUIT THEREON.  EPL
IT SHALL NOT BE LIABLE FOR ANY LOSS OR DAMAGE CAUSED BY DELAY IN FURNISHING ANY
COMPONENT OF THE STANDARD NETWORK OPERATING ENVIRONMENT, ANY REPORTS, ANY
SERVICES, OR ANY OTHER PERFORMANCE UNDER OR PURSUANT TO THIS
AGREEMENT.  EACH PARTY ACKNOWLEDGES AND AGREES THAT THE FOREGOING
LIMITATIONS ON LIABILITY ARE ESSENTIAL ELEMENTS OF THE BASIS OF THE BARGAIN
BETWEEN THE PARTIES AND THAT IN THE ABSENCE OF SUCH LIMITATIONS, THE MATERIAL
AND ECONOMIC TERMS OF THIS AGREEMENT WOULD BE SUBSTANTIALLY
DIFFERENT.

    


    Exhibit 8
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 113
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    8.           Term &
Termination.  This Agreement shall commence on the term
commencement date set forth above and continue in effect unless earlier
terminated by a party for default.  Either party shall have the right
to terminate this Agreement at the end of each 12 month period of Services by
providing the other party with thirty (30) days prior written notice. If no
cancellation notice is received, EPL IT shall have the right to automatically
renew this contract for a period of 12 months.  EPL IT shall have the
right to terminate this Agreement immediately by written notice if Customer
fails to pay annual Fees due on or before the end of the applicable 12 month
period for the Services.

    9.           Default.  If
any material breach of this Agreement continues uncorrected for more than thirty
(30) days after written notice from the aggrieved party describing the breach,
the aggrieved party shall be entitled to declare a default, suspend performance,
terminate this Agreement, and pursue any and all other remedies available at law
or equity, except as specifically limited elsewhere in this
Agreement.

    10.         Notices.  Notices,
authorizations and other official communications under this Agreement shall be
transmitted in writing by prepaid United States certified mail, return receipt
requested, or overnight receipted courier, to EPL IT, at the address and
attention of the person set forth on the first page of this Agreement for EPL IT
and to Customer, to the billing address and attention of the person set forth on
the first page of this Agreement for Customer.  Any notice given
pursuant to this Section shall be deemed to have been received, in the case of
certified mail, on the date of receipt as evidenced by the U.S. Postal Service
return receipt card, and, in the case of overnight courier, on the next business
day after sending, unless documented otherwise by recipient.  All
notices must be in the English language.

    11.         Assignment.  Neither
this Agreement  nor any of the rights or obligations hereunder may be
assigned by either party, in whole or in part, without the prior written consent
of the other party, such consent not to be unreasonably
withheld.  Notwithstanding the preceding sentence, either party may
assign this Agreement to its parent company or another affiliated company
without the consent of the other party but upon written notice to the other
party; provided that the successor unconditionally agrees in writing to be bound
by the terms and conditions of this Agreement.

    12.         Subcontracting.  EPL
IT reserves the right to subcontract such portions of the Services to
subcontractors of EPL IT's choice as it deems appropriate, provided that no such
subcontract shall relieve EPL IT of primary responsibility for performance of
such Services.

    13.         Reserved Rights. EPL
IT’s  service offerings are continually
evolving.  Accordingly, EPL IT reserves the right to make service
substitutions and modifications that do not cause a materially adverse effect in
overall service performance.  EPL IT reserves the right to modify or
amend it standard description of services for each Service Level at any time by
publication or written notice to Customer.  All Services will be
delivered in English.  EPL IT reserves the rights to charge Customer
$250 per call, plus time and materials if dispatch is required, if the
restaurant support center receives excessive training calls as described under
Franchise Support Options – Fee Schedule.

    14.         Indemnification.  Each
party shall indemnify the other with respect to any third party claim alleging
bodily injury, including death, or damage to tangible property, to the extent
such injury or damage is caused by the gross negligence or willful misconduct of
the indemnifying party.  Customer shall indemnify and defend EPL IT,
at  Customer’s expense, from and against any action brought against
EPL IT by a third party, to the extent that such action is based on a claim that
Customer’s Standard Store Configuration, Data or the performance of Services
hereunder.  A condition precedent to any obligation of a party to
indemnify shall be for the other party to promptly advise the indemnifying party
of the claim and turn over its defense.  The party being indemnified
must cooperate in the defense or settlement of the claim, but the indemnifying
party shall have sole control over the defense or settlement.  If the
defense is properly and timely tendered to the indemnifying party, then the
indemnifying party must pay all litigation costs, reasonable attorney's fees,
settlement payments and any damages awarded; provided, however, that this shall
not be construed to require the indemnifying party to reimburse attorney's fees
or related costs that the indemnified party incurs either to fulfill its
obligation to cooperate, or to monitor litigation being defended by the
indemnifying party.

    15.           Independent
Contractor.  Nothing in this Agreement shall be interpreted or
construed so as to create any relationship between the parties other than that
of independent contracting entities.  Neither party shall be
authorized to obligate, bind or act in the name of the other party, except to
the extent EPL IT is expressly authorized to do so in this
Agreement.

    


    Exhibit 8
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 114
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    16.         Non-Solicitation.  Customer
shall not solicit or otherwise seek, directly or indirectly, to induce any of
EPL IT’s employees or contractors to work for Customer for a period of one (1)
year after the employee or contractor ceases to be employed or otherwise
utilized by EPL IT or one (1) year after the termination of this Agreement,
whichever is less.   Prohibited solicitation includes, but is not
limited to, the direct solicitation of any individual or contracting with a
third party to intentionally solicit an individual covered by this
Section.

    17.         Similar
Services.  Customer acknowledges that EPL IT is free to offer
services or work product similar to the Services or Reports to other EPL IT
customers or third parties without restriction or royalty to
Customer.

    18.         Applicable
Law.  The rights and obligations of the parties and all
interpretations and performance of this Agreement shall be governed in all
respects by the laws of the State of California except for its rules with
respect to the conflict of laws.

    19.         Force
Majeure.  In no event shall either party have any liability for
failure to comply with this Agreement if such failure results from the
occurrence of any contingency beyond the reasonable control of the party and
which delays, interrupts or prevents such party from performing its obligations
under this Agreement, including, without limitation, strike or other labor
disturbance or shortage, riot, theft, flood, lightning, storm, any act of God,
power failure, war, delays or failure of third party equipment or manufacturers,
national emergency, interference by any government or governmental agency,
embargo or seizure. The party affected by a force majeure event shall give
notice thereof to the other party within ten days following the occurrence
thereof and shall apprise the other party of the probable extent to which the
affected party will be unable to perform or will be delayed in performing its
obligations hereunder. The affected party shall exercise due diligence to
eliminate or remedy the force majeure cause and shall give the other party
prompt notice when that has been accomplished. Except as provided herein, if
performance of this Agreement by either party is delayed, interrupted or
prevented by reason of any event of force majeure, both parties shall be excused
from performing hereunder while and to the extent that the force majeure
condition exists after which the parties’ performance shall be
resumed.

    20.         Waiver.  Failure
by either party to require performance by the other party or to claim a breach
of any provision of this Agreement will not be construed as a waiver of any
right accruing hereunder or of any subsequent breach, and will not affect the
effectiveness of this Agreement or any part hereof, or prejudice either party
regarding any subsequent action

    21.         Invalidity.  If
any provision of this Agreement is held invalid, the remaining provisions shall
continue in full force and effect and the parties shall substitute for the
invalid provision a valid provision which most closely approximates the economic
effect and intent of the invalid provision.

    22.         Attorneys’
Fees.  In any dispute or litigation between the parties, the
prevailing party shall be entitled to reasonable attorneys’ fees and all costs
of proceedings incurred in enforcing this Agreement.

    23.         Entire
Agreement.  This Agreement constitutes the entire agreement
between EPL IT and Customer with respect to the subject matter hereof and
supersedes all previous negotiations, proposals, commitments, writings,
advertisements, publications and understandings of any nature whatsoever and in
any manner whatsoever relating thereto, but does not amend or supersede any
Franchise Agreement between EPL and Customer.  No agent, employee or
representative of EPL IT has any authority to bind EPL IT to any affirmation,
representation, or warranty concerning the Services and unless such affirmation,
representation or warranty is specifically included within this Agreement, it
shall not be enforceable by Customer or any assignee or sublicensee of
Customer.  Any terms and conditions on any Customer purchase order
form or other document issued by Customer to implement this Agreement that are
in addition to or in conflict with the terms and conditions of this Agreement
shall be null and void, even if acknowledged in writing by EPL IT.  No
change, amendment or modification of this Agreement shall be effective unless
made in writing and signed by the authorized representatives of both
parties.  This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original and all of which together shall
constitute one instrument, and facsimile signature shall be treated as
originals.

    


    Exhibit 8
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 115
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    EPL
IT STANDARD SERVICES DESCRIPTIONS

    (Date:  February
22, 2005)

    


    Limited
Gold and Unlimited Platinum Service Descriptions

    Limited
Gold:  15 calls per store per month ($250 per call thereafter, plus
time and materials if dispatch is required)

    Unlimited
Platinum:  Unlimited number of calls per month per store

     

    Standard
Store Configuration includes:

     

    
      	
               
      

            	
              ·

            	
              Back
      of house system

            


    

    
      	
               
      

            	
              ·

            	
              Two
      front counter POS terminals with receipt
  printers

            


    

    
      	
               
      

            	
              ·

            	
              Two
      drive thru POS terminals with receipt
printer

            


    

    
      	
               
      

            	
              ·

            	
              Two
      KDS systems (two monitors, two controllers, one kitchen
      printer)

            


    

    
      	
               
      

            	
              ·

            	
              DSL
      Wide Area Network connection, router and
  firewall

            


    

    
      	
               
      

            	
              ·

            	
              All
      local area network components including equipment rack, UPS, patch panel,
      patch cords, cabling infrastructure and data
  jacks.

            


    

    


    COMPLETE
I.T. OPERATIONS SUPPORT

     

    Hardware Service and Support
includes:

     

    1.           First
year includes:

    
      	
               
      

            	
              o

            	
              Repair
      and/or replacement cost for all POS hardware, including back of house
      server, KDS system, front of house terminals and cash drawers, receipt
      printers, back office printer, network switch, UPS, line
      conditioners,

            


    

    
      	
               
      

            	
              o

            	
              All
      data cabling, data jacks, voice jacks, patch panels, A/B
      switch

            


    

    2.           Second
year includes:

    
      	
               
      

            	
              o

            	
              Repair
      and/or replacement cost for all POS hardware, including back of house
      server, KDS system, front of house terminals and cash drawers, receipt
      printers.

            


    

     

    Software Service and Support
includes:

     

    
      	
               
      

            	
              ·

            	
              Patching
      of installed Micros RES 3700

            


    

    
      	
               
      

            	
              ·

            	
              Patching
      of installed Micros Enterprise
Management

            


    

    
      	
               
      

            	
              ·

            	
              Patching
      of installedMyEpl.Net Web Based
Portal

            


    

    
      	
               
      

            	
              ·

            	
              Patching
      of installed operating system

            


    

    
      	
               
      

            	
              ·

            	
              Current
      updates on anti virus software

            


    

    
      	
               
      

            	
              ·

            	
              Ghost
      software disaster recovery tool

            


    

    
      	
               
      

            	
              ·

            	
              Proactive
      monitoring via EPL Alerts program

            


    

     

    PaymenTech Credit Card Processing Service and
Support includes:

     

    
      	
               
      

            	
              ·

            	
              Processing
      Visa, MasterCard, American Express and
Discover

            


    

    
      	
               
      

            	
              ·

            	
              Help
      desk support via 1-888-POLLO-IT

            


    

    
      	
               
      

            	
              ·

            	
              Secure
      high speed credit card authorization as
primary

            


    

    
      	
               
      

            	
              ·

            	
              Secure
      low speed credit card authorization as
backup

            


    

    
      	
               
      

            	
              ·

            	
              Gift
      card option (future enhancement)

            


    

     

    Firewall Service and Support
includes:

     

    
      	
               
      

            	
              ·

            	
              Repair
      and/or replacement cost of firewall

            


    

    
      	
               
      

            	
              ·

            	
              Software
      maintenance on firewall

            


    

    
      	
               
      

            	
              ·

            	
              Remote
      monitoring of up/down state

            


    

    
      	
               
      

            	
              ·

            	
              Latest
      security updates to prevent hacker
attacks

            


    

    


    Exhibit 9
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 116
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

     

    Broadband WAN Service and
Support includes:

     

    
      	
               
      

            	
              ·

            	
              High
      speed access to all credit card processing, sub second response
      time.

            


    

    
      	
               
      

            	
              ·

            	
              High
      speed access to MyEpl.net Portal

            


    

    
      	
               
      

            	
              ·

            	
              Does
      not include unrestricted Internet
access

            


    

    
      	
               
      

            	
              ·

            	
              24x7
      active monitoring

            


    

     

    Helpdesk
includes:

     

    
      	
               
      

            	
              ·

            	
              7:00
      am to 12:00 am*  Helpdesk via a toll free number
      1-888-POLLO-IT

            


    

    
      	
               
      

            	
              ·

            	
              Single
      point of contact for hardware and cabling
  dispatch

            


    

    
      	
               
      

            	
              ·

            	
              Menu
      changes

            


    

    
      	
               
      

            	
              ·

            	
              Pricing
      adjustments

            


    

    
      	
               
      

            	
              ·

            	
              Full
      portal support

            


    

    
      	
               
      

            	
              ·

            	
              WAN
      troubleshooting and support

            


    

    
      	
               
      

            	
              ·

            	
              Support
      on all IT and POS issues

            


    

     

    MyEpl.Net Portal Service and Support
includes:

     

    
      	
               
      

            	
              ·

            	
              Access
      to standard corporate reporting

            


    

    
      	
               
      

            	
              ·

            	
              Near
      real time sales performance data for all
stores

            


    

     

    Professional Service
includes:

     

    
      	
               
      

            	
              ·

            	
              Any
      service outside of the scoop of this Agreement will be billing at the
      following rates:

            


    

    
      	
               
      

            	
              o

            	
              Helpdesk
      rate $60 per hour

            


    

    
      	
               
      

            	
              o

            	
              Networking
      rate $120 per hour

            


    

    
      	
               
      

            	
              o

            	
              Development
      rate $120 per hour

            


    

    


    *
Helpdesk hours are subject to change and are Pacific Time

    


    Exhibit 9
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 117
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    Franchise
Support Options – Fee Schedule

    


    
      
        
          
            
              
                	
                        Service Description

                      	 	
                        Annual

                        Cost

                      	 	 	
                        Monthly

                        Cost

                      	 	 	
                        UNLIMITED

                        Platinum

                        Support

                        Option

                      	 	 	
                        LIMITED

                        Gold

                        Support

                        Option A

                      	 	
                        Payable to:

                      
	
                        Complete
      POS Software Service and Support, including PaymenTech
    Support

                      	 	$	935	 	 	$	117	 	 	
                        Yes

                      	 	 	
                        Yes

                      	 	
                        MICROS

                      
	
                        Complete
      Firewall Service and Support

                      	 	$	300	 	 	$	25	 	 	
                        Yes

                      	 	 	
                        Yes

                      	 	
                        CHECKPOINT

                      
	
                        Unlimited
      Number of Calls for Helpdesk Support

                      	 	$	2,000	 	 	$	167	 	 	
                        Yes

                      	 	 	
                        No

                      	 	
                        EPL

                      
	
                        15
      Calls per Month for Helpdesk Support

                      	 	$	1,496	 	 	$	125	 	 	
                        No

                      	 	 	
                        Yes

                      	 	
                        EPL

                      
	
                        MyEpl.Net

                      	 	$	600	 	 	$	50	 	 	
                        Yes

                      	 	 	
                        Yes

                      	 	
                        EPL

                      
	
                        Monthly
      Cost per Store B

                      	 	 	 	 	 	 	 	 	 	$	320	 	 	$	279	 	 
      
	
                        Complete
      POS Hardware Service and Support
      D

                      	 	$	2,100	 	 	$	175	 	 	
                        Yes

                      	 	 	
                        Yes

                      	 	
                        MICROS

                      
	
                        Hardware
      Costs

                      	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
      
	
                        Broadband
      WAN
      C

                      	 	$	1,218	 	 	$	102	 	 	
                        Yes

                      	 	 	
                        Yes

                      	 	
                        MEGAPATH

                      


              

            

          

        

      

    

    


    NOTE:  Mixed
services not allowed.  All service levels must be the same for all
stores per Franchisee.

    


    A
Number of support calls to EPL Helpdesk limited to 15 calls per store per
month.  Additional calls will be charged at $250 per call plus time
and materials if dispatch required.

    B
Monthly rate based on standard store configuration.  Support cost for
non standard configuration subject to change, based on actual hardware
deployed.

    C
DSL service cost is approximate and subject to increase if 192K SDSL is not
available.  Services subject to additional costs are 384K (or higher)
SDSL, Cable, ISDN, Frame Relay, and Fractional or full T1.

    D
First Year Hardware Service And Support is Included at No Charge.  In order
to continue to receive Hardware Service and Support after the first year, (1)
Customer must notify EPL IT in writing within 30 days of the expiration of the
first year for the next 12-month period and annually thereafter; and (2)
Customer must pay the monthly costs associated with the Hardware Service And
Support.  The standard equipment configuration is based upon two (2)
terminals, two (2) drive-through terminals, two (2) KDS and one (1) printer Your
cost will be adjusted depending on your equipment configuration for your
restaurant.

    


    One time
charge to upgrade from Limited GOLD to Unlimited PLATINUM once service agreement
is signed $3500.

    Repair or
Replacement due to neglect, water damage, vandalism, act of God or any other
reason other than normal wear and tear is not covered.

    Cable
service and support provided at no charge for the first year only.

    


    Exhibit 9
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 118
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    EXHIBIT
9 TO FRANCHISE AGREEMENT

    


    GENERAL
RELEASE

    


    This
General Release (“this Release”) is made effective _________________, 20__, by
the undersigned, ____________________________________, a _______________ (“Franchisee”).

     

    For valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, Franchisee hereby waives,
releases, and forever discharges El Pollo Loco, Inc., a Delaware corporation,
all El Pollo Loco affiliates and all the respective officers, directors,
employees, attorneys representatives and agents of said corporations, as well as
parent corporations, subsidiaries, affiliates and any other legal entities which
it owns or controls, individually or jointly, from any and all obligations,
claims, demands, liabilities or actions and causes of action in law or in equity
of whatsoever nature arising prior to and including the date hereof, including,
but not limited to, which Franchisee now has or may hereafter have by reason of
any act, omission, event, deed or course of action having taken place, or which
should have taken place, or on account of or arising out of any claim for breach
of any implied violation of the covenant of good faith and fair dealing or any
other claims which relate or refer in any way to the relationship between EPL
and Franchisee which arises on or before the date hereof insofar as said claims
relate to the franchise agreement or any other agreement between Franchisee or
any of them and the released party or parties,  any alleged violation
of the California Franchise Relations Act, any Federal or State antitrust claims
except as prohibited by law.

    


    It is expressly acknowledged by each of
the undersigned that any and all rights granted under Section 1542 of the
California Civil Code are hereby expressly waived.  Such statute reads
as follows:

    


    “Section
1542.

     

    A general
release does not extend to claims which the creditor does not know or suspect to
exist in his favor at the time of executing the release which if known by him
must have materially affected the settlement with the debtor.”

    


    IN WITNESS WHEREOF each of the
parties either personally or through its duly authorized signatory, as
applicable, has executed this Release effective as of the day first written
above.

     

    
      
        
          
            
              	
                      FRANCHISEE:

                    
	 
      
	 
      
	
                      By: 

                    	 
      
	
                      Its:

                    	 
      


            

          

        

      

    

    


    Exhibit 9
to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 119
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    EXHIBIT
10 TO FRANCHISE AGREEMENT

    


    CONSENT
TO ASSIGNMENT OF FRANCHISE RIGHTS

    


    This Consent to Assignment of Franchise
Rights (the "Agreement") is made as of this   _____ day of
____________, 20___ by and between EL POLLO LOCO, INC., a Delaware corporation
("EPL" or “Franchisor”), _____________________________ (the "Assignor") and _________________________________
(the "Assignee").

    


    RECITALS

    


    A.           EPL
and Assignor are parties to that certain Franchise Agreement dated
_________________________ (the "Franchise Agreement") pertaining to the
operation of the El Pollo Loco restaurant located at _____________________ (the
"Restaurant").

    


    B.           Assignor
desires to assign all of his title, rights, privileges and interests and
obligations under the Franchise Agreement to Assignee and to sell, transfer, and
convey all of his title, rights, privileges, and interests to the Assets of the
Restaurant to Assignee, all in accordance with the assignment provisions of the
Franchise Agreement.

    


    C.           The
Franchise Agreement requires that Assignor first obtain written consent of EPL
before undertaking any assignment of the Franchise Agreement or sale of the
assets of the Restaurant.

    


    NOW, THEREFORE, in consideration of
the mutual covenants contained herein, the parties agree as
follows:

    


    1.           Recitals
A through C above are incorporated herein and by this reference made a part of
this Consent Agreement.

    


    2.           Subject
to the terms and conditions set forth herein, and upon the payment to EPL of a
transfer fee of __________________ Dollars ($____,000.00), EPL
does hereby consent to the assignment by Assignor to Assignee of all of
Assignor's rights, privileges, interests, and obligations under the Franchise
Agreement.

    


    3.           Assignee
shall execute the current form of Franchise Agreement (the "Current Franchise
Agreement") for a term which coincides with the initial term of the Franchise
Agreement and for which there shall be no initial franchise fee; and Assignee
covenants, warrants and agrees that, as of the date hereof, all of the
obligations, liabilities and provisions of the Current Franchise Agreement shall
be fully performed and complied with by Assignee in its capacity as "Franchisee"
under the Current Franchise Agreement, including, but not limited to, payment in
full of all obligations to EPL and to third parties arising from the existence,
operation, or maintenance of the Restaurant.

    


    4.           If there are
remodel requirements the following language will be used: “Assignee
covenants, warrants and agree that, the remodel requirements, as set forth in
Exhibit B, will be
completed to the satisfaction of EPL no later than six (6) months from the close of
escrow.  Assignee has deposited a sum of _______________ Dollars ($_____) as a deposit towards
the cost of the remodel into an interest bearing account subject to the
Amendment to Escrow Instructions, identified as Escrow Number _______ with
_______________________________, Escrow
Officer:  __________________.  EPL has advised Assignee,
based on EPL’s experience, that this deposit will not be sufficient to complete
the required remodel.  Therefore, Assignee agrees that such remodel
will not be considered complete until EPL has agreed to the final completion in
writing, even if the total cost of the remodel is in excess of the
deposit.”

    


    Exhibit
10 to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 120
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    If there are no
remodel requirements the above language will be replaced with: “EPL
acknowledges and agrees that as of the date of this Agreement there are no
remodel requirements to be completed prior to the transfer of the Restaurant
from Assignor to Assignee.”

    


    5.           Assignee
acknowledges and warrants:

    


    a.           that  the
Current Franchise Agreement and any related circulars, manuals, lists, forms and
other documents previously transmitted to Assignee  have been fully
read and understood;

    


    b.           that
Assignee is knowledgeable and experienced in regard to the operation of an El
Pollo Loco restaurant and the EPL operating system;

    


    c.           that
Assignee agrees to undertake, in accordance with the terms of the Current
Franchise Agreement, such training as EPL may deem appropriate in connection
with the operation and maintenance of the Restaurant;

    


    d.           that
Assignee is fully aware that the initial term of the Current Franchise
Agreement  will terminate on _____________________, and has
no renewal option periods and the Current Franchise Agreement does not grant Assignee
any territorial right or licenses, exclusive or  otherwise;
and

    


    e.           that
Assignee has conducted an independent study of the Restaurant, including
consideration of any sales, profits or earnings figures that may have been made
available to Assignee by or on behalf of Assignor, and in entering into this
Agreement, Assignee relies solely upon such independent knowledge and in no
respect has Assignee relied upon any representation, statement, endorsement or
promise, either oral or written, by or on behalf of EPL.

    


    6.           In
consideration of the consent by EPL granted herein, Assignor and Assignee
(collectively “Party”) do each hereby waive, release and forever discharge EPL,
all EPL's affiliates, and all the respective directors, officers, employees,
attorneys, representatives, and agents of said corporations, as well as parent
corporations, subsidiaries, affiliates and any other legal entities which it
owns or controls, individually or jointly, from any and all obligations,
liabilities, claims, demands, actions and causes of action in law or in equity
of whatever kind or nature arising prior to and including the date hereof,
including, but not limited to, which Party now has or may hereafter have by
reason of any act, omission, event, deed or course of action having taken place,
or which should have taken place, or on account of or arising out of any claimed
violation of the Franchise Agreement, any claim for breach of any implied
covenant of good faith and fair dealing or any other claims which relate or
refer in any way to the relationship between EPL and Assignee or EPL and
Assignor which arises on or before the date hereof insofar as said claims relate
to the Franchise Agreement, the assignment of Assignor's title, rights,
privileges, interests, and obligations under the Franchise Agreement as
contemplated in this Agreement, or the Franchise Agreement or any other
agreement between Party or any of them and the released party or parties, any
alleged violation of the California Franchise Relations Act, any Federal or
State antitrust claims except as prohibited by law.  Furthermore, it
is expressly acknowledged by each of the undersigned that any and all rights
granted under Section 1542 of the California Civil Code are hereby expressly
waived. Such statute reads as follows:

    


    "A
general release does not extend to claims which the creditor does not know or
suspect to exist in his favor at the time of executing the release, which if
known by him must have materially affected his settlement with the
debtor."

    


    7.           Assignor
and Assignee understand and agree that Assignor shall remain secondarily liable
in the event of any default by the Assignee under the Current Franchise
Agreement, and that by entering into this Agreement, Assignor and Assignee fully
and unconditionally guarantee the Assignee's performance and compliance in all
respects with the obligations, liabilities and provisions thereunder; provided,
however, that this guarantee shall not extend to
any default of non-compliance with the obligations, liabilities, and provisions
of the Current Franchise Agreement by Assignee during any extension of the
initial term of the Current Franchise Agreement.  Assignor further
understands and agrees that, to the extent principals of Assignor have
personally guaranteed the performance of Assignor under the terms and conditions
of the Current Franchise Agreement, such personal guarantee shall NOT be modified by
this Agreement and any such guarantors shall not be released from liability of
any kind or nature by the terms of this Agreement.  EPL agrees that a
copy of any notice of default given to Assignee by EPL shall also be
concurrently given to Assignor.

    


    Exhibit
10 to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 121
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    8.           Unless
Assignee is currently the franchisee of another El Pollo Loco restaurant,
Assignor shall train, at Assignor's expense, Assignee and up to two (2) of
Assignee's managers prior to Assignee's takeover of the operation of the
Restaurant from Assignor, in order to train Assignee in the EPL operating
system.  Such training must be completed to EPL's satisfaction prior
to turning over the running of the Restaurant to Assignee.  In the
event that Assignor wishes EPL to train Assignee's personnel in the EPL
operating system, Assignor shall reimburse EPL for the cost of such
training.

    


    9.           EPL's
consent to the assignment of Assignor's rights and obligations under the
Franchise Agreement and the assets of the Restaurant is expressly contingent
upon Assignor paying and discharging all obligations incurred in Assignor's
operation of the Restaurant prior to the date of transfer of the Restaurant
operation from Assignor to Assignee ("Changeover Date") including, but not
limited to, the following:

    


    a.           Any
unpaid amounts owed EPL under monthly franchise billing statements for periods
up to the Changeover Date which, through __________, 20___ are
estimated to be _____________Dollars ($_____)
and shall be payable through escrow or by cashier's check to EPL.  If
the Changeover Date is not ______________, 20___, the estimate should be
adjusted by _____________Dollars
($_____)  per diem;

    


    b.           Taxes
due or accrued and unpaid, including, but not limited to, the sales tax on food
and consumables sold in the Restaurant;

    


    c.           Any
federal, state or local taxes required to be withheld from employees' salaries
and wages; and

    


    d.           Any
and all amounts due suppliers and vendors to the Restaurant.

    


    10.         Within
thirty (30) days following the Changeover Date, EPL shall prepare and submit to
Assignor a final accounting for sums due together with a check for any sums due
Assignor or a statement for any sums due EPL. In connection with such
accounting, EPL shall have the right, without the obligation, to pay any bills
incurred by Assignor prior to the Changeover Date and to add amounts so paid to
amounts charged Assignor in such accounting.  As of the Changeover
Date, Assignee shall assume total responsibility for the operation of, and shall
be solely responsible for, any obligations incurred in connection with the
Restaurant prior to the Changeover Date in the event that such obligations have
not been satisfied by Assignor.

    


    11.         This
Agreement shall inure to the benefit of the successors and assigns of EPL, and
to any and all of its affiliates, parents and subsidiaries, and shall be binding
upon the heirs, representatives, successors and assigns of Assignor and
Assignee.

    


    12.         Except
as modified herein, all the terms and conditions of the Franchise Agreement
shall be unaffected and remain in full force and effect.

    


    13.         The
parties hereto acknowledge that they have read and fully understand the
provisions of this Agreement and that said provisions constitute a complete and
exclusive expression of its terms and conditions.

    


    Exhibit
10 to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 122
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    14.           This
Agreement may be executed in one or more counterparts, each of which will
constitute an original, but all of which together will constitute but a single
document.

    


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

    


    
      
        
          
            
              
                
                  
                    
                      	
                              FRANCHISOR:

                            	 
      	
                              ASSIGNOR:

                            
	
                              EL
      POLLO LOCO, INC.,

                            	 
      	
                              _________________________,

                            
	
                              a
      Delaware corporation

                            	 
      	
                              a
      ________________________

                            
	 
      	 
      	 
      	 
      
	
                              By: 

                            	
                              __________________________

                            	 
      	
                              By:
      ______________________

                            
	
                              Its:

                            	
                              __________________________

                            	 
      	
                              Its:
      _______________________

                            
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                              ASSIGNEE:

                            
	 
      	 
      	 
      	
                              ____________________________,

                            
	 
      	 
      	 
      	
                              a
      _________________________

                            
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                              By:  ________________________

                            
	 
      	 
      	 
      	
                              Its:
      ________________________

                            


                    

                  

                

              

            

          

        

      

    

    


    Exhibit
10 to Franchise Agreement (Exhibit D of Disclosure Document 033109)

    
      
         


      

      
        Page 123
of 124

        
          

        

      

      
         


      

    


    El Pollo
Loco Unit # ______

    City,
State

    


    EL POLLO LOCO® FRANCHISE
AGREEMENT

    


    SCHEDULE
1

    


    STATEMENT OF OWNERSHIP OF
FRANCHISEE

    


    Party to
Franchisee Entity - _____ %

    


    Party to
Franchisee Entity - _____ %

    


    Exhibit D
of Disclosure Document 033109 - Franchise Agreement

    
      
         


      

      
        Page 124
of 124