Document:

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                                  EXHIBIT 10.43

                                                               EXECUTION VERSION

                               SECURITY AGREEMENT

                         (SCHLOTZSKY'S FRANCHISOR, LLC)

         This Security Agreement (the "Agreement") dated as of December 29, 2003
is made by and between NS ASSOCIATES I, LTD., a Texas limited partnership (the
"Secured Party"), and SCHLOTZSKY'S FRANCHISOR, LLC, a Delaware limited liability
company ("Pledgor").

                                    RECITALS

         A. DFW Restaurant Transfer Corp., a Texas corporation ("Borrower"),
Schlotzsky's, Inc., a Texas corporation ("SI"), Pledgor and Secured Party are
parties to that certain Debt Restructuring Agreement dated as of the date hereof
(the "Restructuring Agreement"), pursuant to which DFW has issued to Secured
Party that certain amended and restated promissory note dated as of December 15,
2003 (amending and restating that certain promissory note dated August 30, 2002
issued by DFW) in the original principal amount of $23,268,000.00 (as so amended
and restated, and as it may be amended, restated, modified, replaced, renewed or
extended, the "Note").

         B. In order to induce Secured Party to enter into the Restructuring
Agreement, Pledgor executed and delivered to Lender that certain Guaranty, of
even date herewith (the "Guaranty"), pursuant to which Pledgor has guaranteed,
among other things, the obligations of Borrower owing under the Note.

         C. Pledgor and Secured Party are entering into this Agreement in order
to secure Pledgor's obligations under the Guaranty.

                                   AGREEMENTS

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

         1. DEFINITIONS; CONSTRUCTION.

                  (a) Capitalized terms used herein and not otherwise defined
         shall have the meaning assigned to such terms in the Restructuring
         Agreement (including by reference to the Contribution Agreement or any
         Note Document). In addition, as used herein, the following terms shall
         have the following meanings:

         "Accounts" has the meaning set forth in Section 2.

         "Account Debtor" means any Person who is obligated under, with respect
to, or on account of, an Account, chattel paper, or a General Intangible.

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         "ADA Documents" means the Area Development Agreements and all other
agreements between SI or the Pledgor and an Area Developer relating to the
Schlotzsky's(R) branded business.

         "Additional Documents" has the meaning set forth in Section 2(c).

         "Agreement" has the meaning set forth in the first paragraph hereof.

         "Bankruptcy Code" means title 11 of the United States Code, as in
effect from time to time.

         "Books" has the meaning set forth in Section 2.

         "Claim" shall mean any and all: suits, actions, or proceedings in any
court or forum, at law, in equity or otherwise; costs, fines, deficiencies, or
penalties; arbitration demands, proceedings or awards; damages, losses,
penalties, fines, judgments, liabilities and expenses (including reasonable
attorneys' fees and disbursements and other costs of collection, defense or
appeal); enforcement of rights and remedies; or any criminal, civil or
regulatory investigations, fines or penalties.

         "Code" has the meaning set forth in Section 8.

         "Collateral" has the meaning set forth in Section 2.

         "Contribution Agreement" means that certain Contribution Agreement,
dated as of June 7, 2003, between SI and Pledgor, pursuant to which SI
contributed, transferred and conveyed to Pledgor all of SI's right, title and
interest in, to and under the Conveyed Assets (as defined in the Contribution
Agreement).

         "DFW" has the meaning set forth in the first paragraph hereof.

         "Excluded Collateral" means (a) that portion of any Franchisee Payment
representing NAMF Contributions (to the extent of rights of NAMF thereto), and
(b) that portion of any Franchisee Payment representing amounts payable to Area
Developers under any Area Development Agreement as in effect on the date hereof,
in each case only if and for so long as the grant of a Lien to Secured Party
shall constitute or result in a breach or termination pursuant to the terms of,
or a default under, any such Area Development Agreement (in each case, other
than to the extent that (i) the restrictive terms of any such Area Development
Agreement would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408
or 9-409 of the Code (or any successor provision or provisions) of any relevant
jurisdiction or any other applicable law (including the Bankruptcy Code) or
principles of equity, or (ii) such Area Development Agreement is with SI or a
subsidiary or affiliate thereof or such breach or termination can be waived by
SI or any subsidiary or affiliate thereof), provided, however, that such Lien
shall attach immediately at such time as the condition causing such breach or
termination shall be remedied or cease to be effective or SI or any subsidiary
or affiliate thereof shall have the right to waive such breach or termination.

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         "Existing Liens" means the Liens relating to Pledgor described in
Schedule E-1 to the Restructuring Agreement and securing only the Wooley Notes.

         "Event of Default" means any "Event of Default" under the Restructuring
Agreement.

         "General Intangibles" has the meaning set forth in Section 2.

         "Governing Documents" means, with respect to any Person, the
certificate or articles of incorporation or formation, by-laws, limited
liability agreement, or other organizational documents of such Person.

         "Governmental Authority" means any federal, state, local, or other
governmental or administrative body, instrumentality, department, or agency or
any court, tribunal, administrative hearing body, arbitration panel, commission,
or other similar dispute-resolving panel or body.

         "Indemnified Person" has the meaning set forth in Section 10.

         "Management Agreement" means that certain Management Agreement dated as
of June 7, 2003, between Pledgor, Schlotzsky's Brand Products, LLC, Schlotzsky's
NAMF Funding, LLC, Schlotzsky's N.A.M.F., Inc., and the Manager.

         "Manager" means Schlotzsky's Franchise Operations, LLC, a Delaware
limited liability company.

         "NAMF" means any of Schlotzsky's NAMF Funding, LLC and Schlotzsky's
N.A.M.F., Inc.

         "NAMF Contributions" means the amounts to be contributed to NAMF by the
Franchisees pursuant to the Franchise Agreements and which are to be
administered by NAMF, so long as such amounts are consistent (as a percentage of
gross sales payable by the Franchisees under the applicable Franchise Agreement)
with the amounts required pursuant to the standard form of Schlotzsky's
Franchise Agreement as in effect on the date hereof and disclosed to Secured
Party.

         "Negotiable Collateral" has the meaning set forth in Section 2.

         "Note" has the meaning set forth in the Recitals hereto.

         "Note Documents" has the meaning set forth in the Restructuring
Agreement, and includes the Restructuring Agreement, the Note, the Guaranty, the
Trademark Security Agreement, the Pledge Agreement, this Agreement and any other
agreement now existing or hereafter entered into by Pledgor and the Secured
Party in connection with this Agreement or the Guaranty.

         "Obligations" has the meaning set forth in Section 3.

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         "Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organization, limited
liability company or government or other entity.

         "Pledge Agreement" means a stock pledge agreement executed and
delivered by Pledgor and Secured Party, the form and substance of which is
satisfactory to Secured Party, with respect to all Stock of Pledgor in any
Subsidiary thereof, including Schlotzsky's Brand Products, LLC.

         "Pledgor" has the meaning set forth in the first paragraph hereof.

         "Record" means information that is inscribed on a tangible medium or
which is stored in an electronic or other medium and is retrievable in
perceivable form.

         "Secured Party" has the meaning set forth in the first paragraph
hereof.

         "Security Interest" has the meaning set forth in Section 3.

         "SI" has the meaning set forth in the first paragraph hereof.

         "Stock" means all shares, options, warrants, interests (including
general or limited partnership interests, limited liability company interests or
any other ownership interests), participations or other equivalents (regardless
of how designated) of or in a Person, whether voting or nonvoting.

         "Trademark Security Agreement" means a trademark security agreement
executed and delivered by Pledgor and Secured Party, the form and substance of
which is satisfactory to Secured Party.

                  (b) Any terms used herein that are defined in the Code shall
         be construed and defined as set forth in the Code unless otherwise
         defined herein.

                  (c) Unless the context hereof clearly requires otherwise,
         references to the plural include the singular, references to the
         singular include the plural, the term "including" is not limiting, and
         the term "or" has, except where otherwise indicated, the inclusive
         meaning represented by the phrase "and/or." Any reference in this
         Agreement or in the other Note Documents to any agreement, instrument,
         or document shall include all alterations, amendments, changes,
         extensions, modifications, renewals, replacements, substitutions,
         joinders, and supplements, thereto and thereof, as applicable (subject
         to any restrictions on such alterations, amendments, changes,
         extensions, modifications, renewals, replacements, substitutions,
         joinders, and supplements set forth herein).

         2. SECURITY INTEREST.

                  (a) COLLATERAL. Pledgor hereby grants to the Secured Party a
         first priority security interest in and to any and all right, title and
         interest of Pledgor in and to all of the following, whether now owned
         or hereafter acquired or arising and wherever located (all of the
         following being herein sometimes called the "Collateral"):

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                           (i) all accounts and any and all supporting
                  obligations in respect thereof (collectively, the "Accounts");

                           (ii) all books and records (including all of its
                  Records indicating, summarizing, or evidencing its assets
                  (including the Collateral) or liabilities, all of its Records
                  relating to its business operations or financial condition,
                  and all of its goods or General Intangibles related to such
                  information) (collectively, the "Books");

                           (iii) all commercial tort claims;

                           (iv) all deposit accounts;

                           (v) all equipment (including machinery, machine
                  tools, motors, furniture, furnishings, fixtures, vehicles
                  (including motor vehicles), computer hardware, tools, parts
                  and goods (other than consumer goods, farm products, or
                  Inventory), wherever located, including all attachments,
                  accessories, accessions, replacements, substitutions,
                  additions, and improvements to any of the foregoing);

                           (vi) all general intangibles (including payment
                  intangibles, contract rights, rights to payment, rights
                  arising under common law, statutes, or regulations, choses or
                  things in action, goodwill, patents, trade names, trademarks,
                  service marks, copyrights, blueprints, drawings, purchase
                  orders, customer lists, monies due or recoverable from pension
                  funds, route lists, rights to payment and other rights under
                  any royalty or licensing agreements, infringement claims,
                  computer programs, information contained on computer disks or
                  tapes, software, literature, reports, catalogs, money,
                  insurance premium rebates, tax refunds, and tax refund
                  claims), and any and all supporting obligations in respect
                  thereof, and any other personal property other than goods,
                  Accounts, deposit accounts, investment property, and
                  Negotiable Collateral. (collectively, the "General
                  Intangibles");

                           (vii) all inventory;

                           (viii) all investment property, and any and all
                  supporting obligations in respect thereof;

                           (ix) all letters of credit, letter of credit rights,
                  instruments, promissory notes, drafts, documents, and chattel
                  paper (including electronic chattel paper and tangible chattel
                  paper), and any and all supporting obligations in respect
                  thereof (collectively, the "Negotiable Collateral");

                           (x) all money or other assets of Pledgor that now or
                  hereafter come into the possession, custody, or control of
                  Secured Party or any agent or bailee thereof; and

                           (xi) the proceeds and products, whether tangible or
                  intangible, of any of the foregoing, including proceeds of
                  insurance covering any of the foregoing,

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                  and any and all Accounts, Books, deposit accounts, equipment,
                  General Intangibles, inventory, investment property,
                  Negotiable Collateral, real property, money, or other the
                  tangible or intangible property resulting from the sale,
                  exchange, collection, or other disposition of any of the
                  foregoing, or any portion thereof or interest therein, and the
                  proceeds thereof.

         Without limiting the foregoing, Pledgor acknowledges that the
Collateral includes (A) the Schlotzsky's IP; (B) the Franchisee Payments and
Franchise Documents, including the present and continuing exclusive right,
remedy, power and authority to exercise each and every right, remedy, power and
authority of Pledgor under or in respect of the Franchisee Payments and
Franchise Documents; (C) the International License Payments and International
License Documents, including the present and continuing exclusive right, remedy,
power and authority to exercise each and every right, remedy, power and
authority of the Pledgor under or in respect of the International Licensee
Payments and International License Documents; (D) 100% of the membership
interests in the Branding Subsidiary, including the present and continuing
exclusive right, remedy, power and authority to exercise each and every right,
remedy, power and authority of Pledgor under or in respect of such membership
interests; (D) the ADA Documents, including the present and continuing exclusive
right, remedy, power and authority to exercise each and every right, remedy,
power and authority of Pledgor under or in respect of the ADA Documents; (E) the
present and continuing exclusive right, power and authority, subject to the
provisions of the Management Agreement, to make claim for, collect, receive and
make receipt for any of the sums, amounts, income, revenues, issues, profits and
proceeds under, on account of or with respect to, the Franchise Assets, Branding
Assets, including, without limitation, all payments made in respect thereof,
voluntary or involuntary, whether upon maturity, prepayment, acceleration,
conversion, liquidation, casualty or otherwise and paid from any source
(including both timely and delinquent payments); (F) the present and continuing
exclusive right, power and authority, subject to the rights of Pledgor under the
Management Agreement (or of Secured Party with respect thereto pursuant to the
Manager Acknowledgment), to give and receive notices and other communications,
to make waivers or other agreements in respect of, or to make claims for and
demand performance on, under or pursuant to any of the Franchise Assets,
Branding Assets, the Branding Subsidiary License Agreement, or the Area
Development Agreements, to bring actions and proceedings thereunder or for the
enforcement thereof, and to exercise all remedies, powers, privileges and
options and to do any and all things which the Pledgor is or may become entitled
to do under or in respect of the Franchise Assets, the Branding Assets, the
Branding Subsidiary License Agreement and the Area Development Agreements; and
(G) any and all property of every name and nature, now or hereafter transferred,
mortgaged, pledged or assigned as security or additional security for payment or
performance of any obligation of the Persons obligated to make payments to the
Pledgor under the Franchise Documents, Branding Documents or otherwise, and the
liabilities, obligations and the indebtedness evidenced thereby or reflected
therein and all recourse or support obligations, guarantees, indemnities and
security relating to any of the foregoing.

         Notwithstanding the foregoing, in no event shall the Collateral include
the Excluded Collateral. Furthermore, (a) the parties acknowledge that the
granting of a security interest in any Collateral consisting of rights relating
to ADA Buy-Out Payments (and Secured Party's exercise of remedies with respect
thereto) shall be subject to any prior perfected security interest with respect
to the obligations of Franchisor (and the other SI Parties) relating to such ADA
Buy-

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Out Payments, and (b) the security interest granted herein is not intended to
diminish in any way any rights or interests of those three former area
developers (whose rights were re-acquired and purchased in April 1999, April
2001 and October 2001 pursuant to long term payment plans) against any SI Party
or other applicable SI subsidiary or affiliate pursuant to the applicable terms
in existence on the date hereof, and further is not intended to cause, and shall
be limited (with respect to the applicable re-acquired rights) to the extent
necessary so as to prevent, a breach of such terms in existence on the date
hereof, in each case until such area developers are paid in full.

                  (b) NEGOTIABLE COLLATERAL. In the event that any Collateral,
         including proceeds, is evidenced by or consists of Negotiable
         Collateral, and if and to the extent that perfection of priority of
         Secured Party's security interest is dependent on or enhanced by
         possession, Pledgor, immediately upon the request of Secured Party,
         shall endorse and deliver physical possession of such Negotiable
         Collateral to Secured Party.

                  (c) DELIVERY OF ADDITIONAL DOCUMENTATION.

                           (i) Concurrently herewith, Pledgor shall execute and
                  deliver to Secured Party each of the Trademark Security
                  Agreement, and the Pledge Agreement. Pledgor shall further
                  cause the execution and delivery to Secured Party of such
                  Account Control Agreements as may be required pursuant to the
                  Restructuring Agreement or otherwise required by Secured Party
                  pursuant to its rights under this Section 2(c).

                           (ii) Pledgor authorizes Secured Party to file,
                  transmit, or communicate, as applicable, financing statements,
                  in-lieu financing statements and amendments describing the
                  Collateral as "all personal property of Pledgor" or "all
                  assets of Pledgor" or words of similar effect, in order to
                  perfect Secured Party's Liens on the Collateral without such
                  Pledgor's signature. Notwithstanding the foregoing, at any
                  time upon the request of Secured Party, Pledgor shall execute
                  (or cause to be executed) and deliver to Secured Party, any
                  and all financing statements, original financing statements in
                  lieu of continuation statements, control agreements, fixture
                  filings, security agreements (including, if requested by
                  Secured Party, separate security agreements with respect to
                  Pledgor's rights relating to any patents, copyrights or
                  trademarks), pledges, assignments, endorsements of
                  certificates of title, and all other documents (the
                  "Additional Documents") upon which any Pledgor's signature may
                  be required that Secured Party may request in its reasonable
                  discretion, in form and substance satisfactory to Secured
                  Party, to perfect and continue perfected or better perfect the
                  Secured Party's Liens in the Collateral (whether now owned or
                  hereafter arising or acquired), to create and perfect Liens in
                  favor of Secured Party, and in order to fully consummate all
                  of the transactions contemplated hereby and under the other
                  Note Documents. To the maximum extent permitted by applicable
                  law, Pledgor authorizes Secured Party to execute any such
                  Additional Documents in Pledgor's name and authorizes Secured
                  Party to file such executed Additional Documents in any
                  appropriate filing office. Pledgor shall not terminate, amend
                  or file a

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                  correction statement with respect to any financing statement
                  filed with respect to the Collateral without Secured Party's
                  prior written consent.

                           (iii) In addition, on such periodic basis as Secured
                  Party shall require, Pledgor shall (a) provide Secured Party
                  with a report of all patentable, copyrightable, or
                  trademarkable materials acquired or generated by Pledgor
                  during the prior period, (b) in the exercise of Pledgor's
                  reasonable business judgment, cause all such patents,
                  copyrights, and trademarks acquired or generated by Pledgor
                  are not already the subject of a registration with the
                  appropriate filing office (or an application therefor
                  diligently prosecuted), and that are material in any respect
                  to Pledgor's business, to be registered with such appropriate
                  filing office in a manner sufficient to impart constructive
                  notice of Pledgor's ownership thereof.

                           (iv) In addition, Pledgor agrees that, upon acquiring
                  any interest in a commercial tort claim in an amount, in
                  excess of $500,000 such Pledgor shall, in writing, describe
                  the details of such claims and hereby grants to Secured Party
                  a first priority perfected security interest therein pursuant
                  to documentation acceptable to Secured Party.

         3. THE OBLIGATIONS. The security interest herein granted (the "Security
Interest") shall secure full payment and performance of all liabilities,
obligations, or undertakings owing by Pledgor to the Secured Party of any kind
or description arising out of or outstanding under, advanced or issued pursuant
to, or evidenced by the Guaranty, the Restructuring Agreement, this Agreement,
or any of the other Note Documents, irrespective of whether for the payment of
money, whether direct or indirect, absolute or contingent, due or to become due,
voluntary or involuntary, whether now existing or hereafter arising, and
including all interest, costs, fees (including reasonable attorneys' fees), and
expenses (including interest, costs, fees, and expenses that, but for the
provisions of the Bankruptcy Code, would have accrued irrespective of whether a
claim thereof is allowed) and any and all other amounts which Pledgor is
required to pay pursuant to any of the foregoing, by law, or otherwise (all such
all liabilities, obligations, or undertakings, collectively the "Obligations").

         4. REPRESENTATIONS AND WARRANTIES OF PLEDGOR. Pledgor hereby makes each
and every representation and warranty set forth in the Restructuring Agreement
by or with respect to Pledgor, each of which is incorporated herein by
reference. Without limiting the foregoing, Pledgor represents and warrants to
the Secured Party that (a) Pledgor is the owner of the Collateral free and clear
of any liens, claims or encumbrances, other than the Existing Liens; and no
dispute, right of setoff, counterclaim, or defenses exist with respect to all or
any part of the Collateral; (b) the security interests granted by Pledgor to
Secured Party in and to its properties and assets pursuant to this Agreement and
the other Note Documents are validly created, perfected, and first priority
security interests, subject only to the Existing Liens. The delivery at any time
by Pledgor to the Secured Party of Collateral shall constitute a representation
and warranty by Pledgor under this Agreement that, with respect to such
Collateral, and each item thereof, the matters heretofore warranted in the
foregoing clauses (a) and (b) are true and correct.

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         5. AFFIRMATIVE COVENANTS OF PLEDGOR. So long as any part of the
Obligations remain unpaid or unperformed, Pledgor covenants and agrees to (and
to cause Manager or Branding Subsidiary, as applicable, to):

                  (a) PRESERVATION OF COLLATERAL. Preserve all of Pledgor's
         rights under the Collateral in the ordinary course of business, and
         subject in all events to the limitations set forth in the Note
         Documents; provided, however, with respect to the International License
         Assets, Pledgor shall use its sole discretion in dealing with such
         International License Assets.

                  (b) CHANGE IN ADDRESS. Promptly notify the Secured Party of
         any change in Pledgor's address;

                  (c) COLLATERAL INFORMATION. Promptly furnish such information
         as the Secured Party may reasonably request concerning the Collateral;

                  (d) UPDATES. Promptly notify the Secured Party of any material
         change in any fact or circumstance warranted or represented by Pledgor
         herein;

                  (e) NOTICE OF CLAIMS. Promptly notify the Secured Party of any
         Claim affecting the Collateral, or any part thereof, or the Security
         Interest herein created, and at the request of the Secured Party,
         appear in and defend, at Pledgor's expense, any such Claim.

         6. NEGATIVE COVENANTS OF PLEDGOR. Pledgor further covenants and agrees
that, without the prior written consent of the Secured Party, Pledgor will not,
and will not permit any of its subsidiaries, or the Manager with respect to
Pledgor or any such subsidiary, to:

                  (a) ASSET DISPOSITIONS. Except as expressly permitted in the
         Restructuring Agreement or in any other Note Document entered into on
         or after the date hereof, sell, lease, license (including entering into
         or permitting to exist any Franchise Agreement, Area Development
         Agreement), assign, transfer or otherwise dispose of any of its assets;

                  (b) LIENS. Except as expressly permitted in the Restructuring
         Agreement or in any other Note Document entered into on or after the
         date hereof, create any other security interest in, mortgage or
         otherwise encumber any of its assets (including the Collateral), or any
         part thereof, or permit the same to be or become subject to any lien,
         attachment, execution, sequestration, other legal or equitable process
         or any encumbrance of any kind or character, except for Liens in favor
         of Secured Party;

                  (c) AMENDMENTS TO MATERIAL CONTRACTS. Except as expressly
         permitted in the Restructuring Agreement or in any other Note Document
         entered into on or after the date hereof, amend, modify or terminate or
         consent to an amendment, modification or termination of the Secured
         Party ADA, the Assignments, the Management Agreement or the Branding
         Subsidiary License Agreement;

                  (d) CHANGE IN BUSINESS OR FORM. Make any material change in
         the principal nature of its business; change its organizational
         identification number, state of

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         organizational or organization identity; or reorganize, or
         recapitalize, or reclassify its stock or ownership interests;

                  (e) MERGER. Merge with, consolidate with, acquire all or
         substantially all of the assets or capital stock (or other ownership
         interests) of, or otherwise combine with, any Person or form any
         subsidiary, except that any subsidiary of Pledgor may merge or
         consolidate with Pledgor (so long as Pledgor is the surviving entity);

                  (f) PLEDGOR FUNDS. Commingle any Pledgor funds with funds of
         any other Person.

         7. AUDIT RIGHTS. Pledgor shall permit (and cause Manager to permit)
Secured Party or its designee (at Pledgor's expense) to examine and audit, not
more often than twice per calendar year, upon prior reasonable notice to Manager
and/or Pledgor, as applicable, during business hours, but without unreasonably
disturbing such Pledgor's or Manager's operations, the quarterly results of
Pledgor reflected in filings with the Securities and Exchange Commission and
supporting information thereto.

         8. REMEDIES. Upon the occurrence of an Event of Default, in addition to
any and all other rights and remedies which the Secured Party may then have
hereunder, under the Uniform Commercial Code of the State of Texas or of any
other pertinent jurisdiction (the "Code"), or otherwise, the Secured Party may,
at its option:

                  (a) enter upon the premises where any of the Collateral not in
         the possession of the Secured Party or its agent is located and take
         possession thereof and remove the same, with or without judicial
         process;

                  (b) reduce its claim to judgment or foreclose or otherwise
         enforce the Security Interest, in whole or in part, by any available
         judicial procedure;

                  (c) after notification, if any, provided for herein, sell,
         lease, or otherwise dispose of, at the offices of the Secured Party, on
         the premises of Pledgor, or elsewhere, all or any part of the
         Collateral, in its then condition or following any commercially
         reasonable preparation or processing, and any such sale or other
         disposition may be as a unit or in parcels, by public or private
         proceedings, and by way of one or more contracts (it being agreed that
         the sale of any part of the Collateral shall not exhaust the Secured
         Party's power of sale, but sales may be made from time to time, and at
         any time, until all of the Collateral has been sold or until the
         Obligations have been paid and performed in full), and at any such sale
         it shall not be necessary to exhibit any of the Collateral;

                  (d) at its discretion, surrender any policies of insurance on
         the Collateral and receive the unearned premiums, and, in connection
         therewith, the Pledgor hereby appoints the Secured Party as the agent
         and attorney-in-fact for the Pledgor to collect such premiums;

                  (e) at its discretion, retain the Collateral in satisfaction
         of the Obligations whenever the circumstances are such that the Secured
         Party is entitled to do so under the Code or otherwise; and

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                  (f) exercise any and all other rights, remedies and privileges
         it may have under any other agreement securing all or part of the
         Obligations.

         Any and all proceeds ever received by the Secured Party from any sale
or other disposition of the Collateral, or any part thereof, or the exercise of
any other remedy pursuant hereto shall be applied by the Secured Party to the
Obligations in such order and manner as the Secured Party, in its sole
discretion, may deem appropriate, notwithstanding any directions or instructions
to the contrary by the Pledgor; if such proceeds are not sufficient to pay the
Obligations in full, the Pledgor shall remain liable to the Secured Party for
the deficiency.

         With respect to any of the Collateral which is or becomes accounts,
contract rights, instruments, or chattel paper, the Secured Party, without
notice to the Pledgor, shall be entitled, but not obligated, at any time and
from time to time to notify and direct the Account Debtor or Pledgor thereon to
thereafter make all payments on such Collateral directly to the Secured Party,
regardless of whether the Pledgor was previously making collections thereon.
Each Account Debtor and Pledgor making payment to the Secured Party hereunder
shall be fully protected in relying on the written statement of the Secured
Party that he then holds the Security Interest which entitles him to receive
such payment, and the receipt of the Secured Party for such payment shall be
full acquittance therefor to the one making such payment.

         9. COSTS, RISKS. Should any part of the tangible Collateral come into
the possession of the Secured Party, whether before or after the occurrence of
and Event of Default, the Secured Party may, but shall have no obligation to,
use or operate such Collateral for the purpose of preserving it or its value, or
pursuant to the order of a court of appropriate jurisdiction or in accordance
with any other rights held by the Secured Party in respect of the Collateral.
The Pledgor covenants to promptly reimburse and pay to the Secured Party, at the
Secured Party's request the amount of all reasonable expenses (including the
cost of any insurance and payment of taxes or other charges) incurred by the
Secured Party in connection with its custody, preservation, use, or operation of
the Collateral, and, all such expenses, costs, taxes, and other charges shall be
a part of the Obligations and shall bear interest at the Default Rate from the
date incurred until the date repaid to the Secured Party. It is agreed, however,
that the risk of loss or damage to such Collateral is on the Pledgor, and the
Secured Party shall have no liability whatsoever (i) for failure to preserve the
value of any Collateral, (ii) for maintaining any obligation in terms of
payment, or (iii) for failure to obtain or maintain insurance, or to determine
whether any insurance ever in force is adequate as to amount or as to the risks
insured.

         10. EXPENSES; INDEMNITY.

                  (a) Pledgor agrees to pay or reimburse Secured Party for all
         costs and expenses incurred by Secured Party in connection with the
         preparation, execution and delivery of this Agreement and any other
         Note Document and the consummation and performance of the transactions
         contemplated hereby, including, without limitation, all legal fees.
         Pledgor further agrees to pay or reimburse Secured Party for all costs
         and expenses (all of which shall become part of the Obligations)
         incurred in connection with the enforcement or attempted enforcement,
         or preservation of any rights under this Agreement, and any other Note
         Document, or in connection with any refinancing, or restructuring of
         any such documents in the nature of a "workout" or of any insolvency or
         bankruptcy proceeding,

                                       11
<PAGE>

         including, without limitation, reasonable attorneys' fees and costs.
         The foregoing costs and expenses to be reimbursed by Pledgor shall
         include all search, filing, recording, insurance and appraisal charges
         and fees and taxes related thereto, and other out-of-pocket expenses
         incurred by Secured Party and the cost of independent public
         accountants and other outside experts retained by Secured Party. The
         agreements in this Section shall survive repayment of all Obligations
         and termination of this Agreement.

                  (b) Pledgor shall indemnify and hold Secured Party and its
         Affiliates, and their respective employees, attorneys and agents (each,
         an "Indemnified Person"), harmless from and against any Claim which may
         be instituted or asserted against or incurred by any such Indemnified
         Person as the result of the transactions contemplated under this
         Agreement and the other Note Documents, including any legal costs and
         expenses of disputes between the parties to this Agreement or any other
         Note Document; provided, that Pledgor shall not be liable for
         indemnification of an Indemnified Person to the extent that any such
         Claim is finally determined by a court of competent jurisdiction to
         have resulted solely from such Indemnified Person's gross negligence or
         willful misconduct. NO INDEMNIFIED PERSON SHALL BE RESPONSIBLE OR
         LIABLE TO ANY OTHER PARTY TO ANY LOAN DOCUMENT, ANY SUCCESSOR, ASSIGNEE
         OR THIRD PARTY BENEFICIARY OR ANY OTHER PERSON ASSERTING CLAIMS
         DERIVATIVELY THROUGH SUCH PARTY, FOR INDIRECT, PUNITIVE, EXEMPLARY OR
         CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF THIS
         AGREEMENT OR ANY OTHER LOAN DOCUMENT OR AS A RESULT OF ANY TRANSACTION
         CONTEMPLATED HEREUNDER OR THEREUNDER.

                  (c) In any suit, proceeding or action brought by Secured Party
         relating to any item of Collateral or any sum owing hereunder, or to
         enforce any provision of any item of Collateral, Pledgor shall save,
         indemnify and keep Secured Party harmless from and against all expense,
         loss or damage suffered by reason of such action or any defense,
         setoff, or counterclaim asserted for any reason by the other party or
         parties to such litigation and however arising. All obligations of
         Pledgor with respect to any item of Collateral shall be and remain
         enforceable against, and only against, Pledgor, and shall not be
         enforceable against Secured Party.

         11. NOTICE. Reasonable notification of the time and place of any public
sale of the Collateral, or reasonable notification of the time after which any
private sale or other intended disposition of the Collateral is to be made
(including retention thereof in satisfaction of the Obligations), shall be sent
to the Pledgor and to any other person entitled under the Code to notice. It is
agreed that notice sent or given at least ten (10) calendar days prior to the
taking of the action to which the notice relates is reasonable notification and
notice for the purposes of this paragraph.

         12. RIGHTS CUMULATIVE. All rights and remedies of the Secured Party
hereunder are cumulative of each other and of every other right or remedy which
the Secured Party may otherwise have at law or in equity or under any other
contract or other writing for the enforcement of the Security Interest herein or
in the collection of the Note or the Obligations,

                                       12
<PAGE>

and the exercise of one or more rights or remedies shall not prejudice or impair
the concurrent or subsequent exercise of other rights or remedies.

         13. ASSIGNMENT. The rights, powers and interests held by the Secured
Party hereunder, together with the Security Interest in the Collateral, may be
transferred and assigned by the Secured Party, in whole or in part at such time
and upon such terms as the Secured Party may deem advisable.

         14. POWER OF ATTORNEY. The Secured Party is hereby appointed the
attorney-in-fact of the Pledgor, effective upon the occurrence of an Event of
Default, for the purpose of carrying out the provisions of this Agreement and
taking any action and executing any instruments which the Secured Party may deem
necessary or advisable to accomplish the purposes hereof, which appointment as
attorney-in-fact is irrevocable and coupled with an interest.

         15. NO WAIVERS. No failure on the part of the Secured Party to
exercise, and no delay in exercising any right, power or remedy hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise by the
Secured Party of any right, power or remedy hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.

         16. BINDING EFFECT. This Agreement shall be binding on the Pledgor and
the Pledgor's successors and assigns and shall inure to the benefit of the
Secured Party, and the Secured Party's successors and assigns.

         17. TERMINATION. This Agreement and the Security Interest in the
Collateral will terminate when the Obligations secured hereby have been paid in
full by extinguishment thereof but not by renewal, modification or extension
thereof.

         18. GOVERNING LAW. The law governing this Agreement will be that of the
State of Texas in force on the date of execution of this Agreement. All
obligations of the Pledgor under the terms of this Agreement shall be
performable in Dallas County, Texas.

         19. MAILINGS. All notices and other communications hereunder shall be
in writing and shall be mailed, sent or delivered in accordance with the
Restructuring Agreement.

         20. AGREEMENT AS FINANCING STATEMENT. The Secured Party shall have the
right at any time to execute and file this Agreement as a financing statement,
but the failure of the Secured Party to do so shall not impair the validity or
enforceability of this Agreement.

         21. SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws effective during
the term of this Agreement, the legality, validity, and enforceability of the
remaining provisions of this Agreement shall not be affected thereby, and in
lieu of each such illegal, invalid, or unenforceable provision there shall be
added automatically as a part of this Agreement a provision as similar in terms
to such illegal, invalid, or unenforceable provision as may be possible and be
legal, valid, and enforceable.

         22. COUNTERPARTS. This Agreement has been executed in a number of
identical counterparts, each of which, for all purposes, is to be deemed an
original, and all of which

                                       13
<PAGE>

collectively constitute one agreement, but in making proof of this Agreement, it
shall not be necessary to produce or account for more than one such counterpart.

         23. NUMBER AND GENDER OF WORDS. Whenever herein the singular number is
used, the same shall include the plural where appropriate, and words of any
gender shall include each other gender where appropriate.

         24. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement,
and supersedes all other prior agreements and understandings, both written and
oral, among the parties with respect to the subject matter hereof.

                            [signature page follows]

                                       14
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day, month and year first above written.

                                   PLEDGOR:

                                   SCHLOTZSKY'S FRANCHISOR, LLC

                                   By: /s/ JEFFREY J. WOOLEY
                                       --------------------------------
                                   Name: Jeffrey J. Wooley
                                   Title: Senior Vice President

                                   SECURED PARTY:

                                   NS ASSOCIATES I, LTD.

                                   By: NS Associates, Inc.
                                   Its: General Partner

                                        By: /s/ MORRIS NEWBERGER
                                            --------------------------------
                                            Morris Newberger
                                            President

                     [SIGNATURE PAGE TO SECURITY AGREEMENT]<PAGE>

                                                                   EXHIBIT 10.44

                                                               EXECUTION VERSION

                          TRADEMARK SECURITY AGREEMENT

                         (SCHLOTZSKY'S FRANCHISOR, LLC)

            This TRADEMARK SECURITY AGREEMENT (this "Agreement"), dated as of
December 29, 2003, is made by SCHLOTZSKY'S FRANCHISOR, LLC, a Delaware limited
liability company ("Pledgor"), in favor of NS ASSOCIATES I, LTD., a Texas
limited partnership ("Secured Party"), with reference to the following:

            WHEREAS, DFW Restaurant Transfer Corp., a Texas corporation
("Borrower"), Schlotzsky's, Inc., a Texas corporation ("SI"), Pledgor and
Secured Party are parties to that certain Restructuring Agreement dated as of
the date hereof (the "Restructuring Agreement"), pursuant to which Borrower has
issued to Secured Party that certain amended and restated promissory note dated
as of December 15, 2003 (amending and restating that certain promissory note
dated August 30, 2002 issued by Borrower) in the original principal amount of
$23,268,000.00 (as so amended and restated, and as it may be amended, restated,
modified, replaced, renewed or extended, the "Note").

            WHEREAS, in order to induce Secured Party to enter into the
Restructuring Agreement, Pledgor executed and delivered to Secured Party that
certain Continuing Guaranty, of even date herewith (the "Guaranty"), pursuant to
which Pledgor has guaranteed, among other things, the obligations of Borrower
owing under the Note, and, in connection with such Guaranty (and as security
therefor), Pledgor and Secured Party are parties to that certain Security
Agreement, dated as of even date herewith (as amended or otherwise modified from
time to time, the "Security Agreement"), pursuant to which Pledgor has granted
to Secured Party security interests in (among other things) all general
intangibles of Pledgor.

            WHEREAS, pursuant to the Restructuring Agreement and the Security
Agreement, and as one of the conditions precedent to the willingness of Secured
Party to permit the restructuring of obligations pursuant to the terms set forth
in the Restructuring Agreement and related documents), Pledgor has agreed to
execute and deliver this Agreement to Secured Party for its filing, or the
filing of a memorandum with respect to this Agreement, with the PTO, and as
further evidence of and to effectuate Secured Party's existing security
interests in the trademarks and other general intangibles described herein.

            NOW, THEREFORE, for valuable consideration, the receipt and adequacy
of which is hereby acknowledged, Pledgor hereby agrees in favor of Secured Party
as follows:

            1. Definitions; Interpretation.

                  (a) Certain Defined Terms. Capitalized terms used herein and
not otherwise defined herein shall have the meanings ascribed to them in the
Security Agreement (including by reference to the Restructuring Agreement and
related documents). As used in this Agreement, the following terms shall have
the following meanings:

            "Agreement" has the meaning ascribed to such term in the preamble
hereto.
<PAGE>
            "Borrower" has the meaning ascribed to such term in the recitals to
this Agreement.

            "Event of Default" means any Event of Default under the Security
Agreement.

            "Guaranty" has the meaning ascribed to such term in the recitals to
this Agreement.

            "Note" has the meaning ascribed to such term in the recitals to this
Agreement.

            "Pledgor" has the meaning ascribed to such term in the preamble to
this Agreement.

            "Proceeds" means whatever is receivable or received from or upon the
sale, lease, license, collection, use, exchange or other disposition, whether
voluntary or involuntary, of any Trademark Collateral, including "proceeds" as
such term is defined in the UCC, and all proceeds of proceeds. Proceeds shall
include (i) any and all accounts, chattel paper, instruments, general
intangibles, cash and other proceeds, payable to or for the account of Pledgor,
from time to time in respect of any of the Trademark Collateral, (ii) any and
all proceeds of any insurance, indemnity, warranty or guaranty payable to or for
the account of Pledgor from time to time with respect to any of the Trademark
Collateral, (iii) any and all claims and payments (in any form whatsoever) made
or due and payable to Pledgor from time to time in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of all or any
part of the Trademark Collateral by any Person acting under color of
governmental authority, and (iv) any and all other amounts from time to time
paid or payable under or in connection with any of the Trademark Collateral or
for or on account of any damage or injury to or conversion of any Trademark
Collateral by any Person.

            "PTO" means the United States Patent and Trademark Office and any
successor thereto.

            "Restructuring Agreement" has the meaning ascribed to such term in
the recitals to this Agreement.

            "Secured Obligations" means, with respect to Pledgor, all
liabilities, obligations, or undertakings owing by Pledgor to Secured Party of
any kind or description arising out of or outstanding under, advanced or issued
pursuant to, or evidenced by the Guaranty, the Security Agreement, this
Agreement, or any of the other Note Documents, irrespective of whether for the
payment of money, whether direct or indirect, absolute or contingent, due or to
become due, voluntary or involuntary, whether now existing or hereafter arising,
and including all interest, costs, indemnities, fees (including attorneys fees),
and expenses (including interest, costs, indemnities, fees, and expenses that,
but for the provisions of the Bankruptcy Code, would have accrued irrespective
of whether a claim therefor is allowed) and any and all other amounts which
Pledgor is required to pay pursuant to any of the foregoing, by law, or
otherwise.

            "Secured Party" has the meaning ascribed to such term in the
preamble to this Agreement, and includes its successors and assigns.

                                       2
<PAGE>
            "Security Agreement" has the meaning ascribed to such term in the
recitals to this Agreement.

            "SI" has the meaning ascribed to such term in the recitals to this
Agreement.

            "Trademark Collateral" has the meaning set forth in Section 2.

            "Trademarks" has the meaning set forth in Section 2.

            "UCC" means the Uniform Commercial Code as in effect from time to
time in the State of Texas.

            "United States" and "U.S." each mean the United States of America.

            "U.S. Trademark Collateral" means Trademark Collateral registered or
used in the United States.

            "U.S. Trademarks" means Trademarks registered or used in the United
States.

                  (b) Terms Defined in UCC. Where applicable and except as
otherwise defined herein, terms used in this Agreement shall have the meanings
assigned to them in the UCC.

                  (c) Interpretation. Unless the context of this Agreement
clearly requires otherwise, references to the plural include the singular,
references to the singular include the plural, the term "including" is not
limiting, and the term "or" has, except where otherwise indicated, the inclusive
meaning represented by the phrase "and/or." The words "hereof," "herein,"
"hereby," "hereunder," and similar terms in this Agreement refer to this
Agreement as a whole and not to any particular provision of this Agreement.
Section, subsection, clause, schedule, and exhibit references are to this
Agreement unless otherwise specified. All of the exhibits or schedules attached
to this Agreement shall be deemed incorporated herein by reference. Any
reference in this Agreement or in any of the other Note Documents to this
Agreement or any of the other Note Documents shall include all alterations,
amendments, changes, extensions, modifications, renewals, replacements,
substitutions, joinders, and supplements, thereto and thereof, as applicable
(subject to any restrictions on such alterations, amendments, changes,
extensions, modifications, renewals, replacements, substitutions, joinders, and
supplements set forth therein). Any reference herein to the payment in full of
the Secured Obligations shall mean the payment in full in cash of all Secured
Obligations other than contingent indemnification Secured Obligations. Any
reference herein to any Person shall be construed to include such Person's
successors and assigns. Any requirement of a writing contained herein shall be
satisfied by the transmission of a Record and any Record transmitted shall
constitute a representation and warranty as to the accuracy and completeness of
the information contained therein. The captions and headings are for convenience
of reference only and shall not affect the construction of this Agreement.
References to statutes or regulations are to be construed as including all
statutory and regulatory provisions consolidating, amending or replacing the
statute or regulation referred to.

            2. Security Interest.

                                       3
<PAGE>
                  (a) Assignment and Grant of Security in respect of the Secured
Obligations. To secure the prompt payment and performance of the Secured
Obligations, Pledgor hereby grants, assigns, transfers and conveys to Secured
Party a continuing security interest in all of Pledgor's right, title and
interest in and to the following property, whether now existing or hereafter
acquired or arising and whether registered or unregistered (collectively, the
"Trademark Collateral"):

                          (i) all state (including common law) and federal
      trademarks, service marks and trade names, corporate names, company names,
      business names, fictitious business names, trade styles, trade dress,
      logos, other source or business identifiers, designs and general
      intangibles of like nature, now existing or hereafter adopted or acquired,
      together with and including all licenses therefor held by Pledgor, and all
      registrations and recordings thereof, and all applications filed or to be
      filed in connection therewith, including registrations and applications in
      the PTO, any State of the United States (but excluding each application to
      register any trademark, service mark, or other mark prior to the filing
      under applicable law of a verified statement of use (or the equivalent)
      for such trademark or service mark) and all extensions or renewals
      thereof, including without limitation any of the foregoing identified on
      Schedule A hereto (as the same may be amended, modified or supplemented
      from time to time), and the right (but not the obligation) to register
      claims under any state or federal trademark law or regulation and to apply
      for, renew and extend any of the same, to sue or bring opposition or
      cancellation proceedings in Pledgor's name or in the name of Secured Party
      for past, present or future infringement or unconsented use thereof, and
      all rights arising therefrom throughout the world (collectively, the
      "Trademarks");

                          (ii) all claims, causes of action and rights to sue
      for past, present or future infringement or unconsented use of any
      Trademarks and all rights arising therefrom and pertaining thereto;

                          (iii) all general intangibles related to or arising
      out of any of the Trademarks and all the goodwill of Pledgor's business
      symbolized by the Trademarks or associated therewith; and

                          (iv) all Proceeds of any and all of the foregoing.

                  (b) Continuing Security Interest. Pledgor hereby agrees that
this Agreement shall create a continuing security interest in the Trademark
Collateral which shall remain in effect until terminated in accordance with
Section 18.

                  (c) Incorporation into Security Agreement. This Agreement
shall be fully incorporated into the Security Agreement and all understandings,
agreements and provisions contained in the Security Agreement shall be fully
incorporated into this Agreement. Without limiting the foregoing, the Trademark
Collateral described in this Agreement shall constitute part of the Collateral
in the Security Agreement.

                  (d) Licenses. Pledgor may grant licenses of the Trademark
Collateral in accordance with the terms of the Security Agreement.

                                       4
<PAGE>
            3. Further Assurances; Appointment of Secured Party as
Attorney-in-Fact. Pledgor at its expense shall execute and deliver, or cause to
be executed and delivered, to Secured Party any and all documents and
instruments, in form and substance reasonably satisfactory to Secured Party, and
take any and all action, which Secured Party, in the exercise of its discretion,
may request from time to time, to perfect and continue the perfection or to
maintain the priority of, or provide notice of the security interest in the U.S.
Trademark Collateral held by Secured Party and to accomplish the purposes of
this Agreement. If Pledgor refuses to execute and deliver, or fails timely to
execute and deliver, any of the documents it is requested to execute and deliver
by Secured Party in accordance with the foregoing, Secured Party shall have the
right, in the name of Pledgor, or in the name of Secured Party or otherwise,
with 3 Business Days' prior written notice to Pledgor (except after the
occurrence and during the continuation of an Event of Default, during which
period no such notice shall be required), and Pledgor hereby irrevocably
constitutes and appoints Secured Party (and any of Secured Party's officers or
employees or agents designated by Secured Party) as Pledgor's true and lawful
attorney-in-fact with full power and authority, (i) to sign the name of Pledgor
on all or any of such documents or instruments and perform all other acts that
Secured Party in the exercise of its discretion deems necessary in order to
perfect or continue the perfection of, maintain the priority or enforceability
of or provide notice of the security interest in the U.S. Trademark Collateral
held by Secured Party, and (ii) to execute any and all other documents and
instruments, and to perform any and all acts and things for and on behalf of
Pledgor, which Secured Party, in the exercise of its discretion, may deem
necessary or advisable to maintain, preserve and protect the U.S. Trademark
Collateral and to accomplish the purposes of this Agreement, including (A) after
the occurrence and during the continuance of any Event of Default, to defend,
settle, adjust or institute any action, suit or proceeding with respect to any
U.S. Trademark Collateral, (B) after the occurrence and during the continuation
of any Event of Default, to assert or retain any rights under any license
agreement for any of any U.S. Trademark Collateral, and (C) after the occurrence
and during the continuance of any Event of Default, to execute any and all
applications, documents, papers and instruments for Secured Party to use any
U.S. Trademark Collateral, to grant or issue any exclusive or non-exclusive
license with respect to any material U.S. Trademark Collateral, and to assign,
convey or otherwise transfer title in or dispose of the U.S. Trademark
Collateral. The power of attorney set forth in this Section 3, being coupled
with an interest, is irrevocable so long as this Agreement shall not have
terminated in accordance with Section 18; provided that the foregoing power of
attorney shall terminate when all of the Secured Obligations have been fully and
finally paid in full and performed.

            4. Representations and Warranties. Pledgor represents and warrants
to Secured Party, in each case to the best of its knowledge, information, and
belief, as follows:

                  (a) No Other Trademarks. Schedule A sets forth a true and
correct list of all of Pledgor's existing U.S. Trademarks that are registered,
or for which any application for registration has been filed with the PTO or any
corresponding or similar trademark office of any other U.S. jurisdiction, and
that are owned or held (whether pursuant to a license or otherwise) and used by
Pledgor.

                  (b) Trademarks Subsisting. Each of Pledgor's U.S. Trademarks
listed in Schedule A is subsisting and has not been adjudged invalid or
unenforceable, in whole or in part,

                                       5
<PAGE>
and, to the best of Pledgor's knowledge, each of the U.S. Trademarks set forth
on Schedule A is valid and enforceable.

                  (c) Ownership of Trademark Collateral; No Violation. (i)
Pledgor has rights in and good and defensible title to the U.S. Trademark
Collateral, (ii) Pledgor is the sole and exclusive owner of the U.S. Trademark
Collateral, free and clear of any Liens and rights of others (other than the
Existing Liens and licenses permitted pursuant to the Security Agreement),
including licenses, registered user agreements and covenants by Pledgor not to
sue third persons, and (iii) with respect to any U.S. Trademarks for which
Pledgor is either a licensor or a licensee pursuant to a license or licensing
agreement regarding such U.S. Trademark, each such license or licensing
agreement is in full force and effect, Pledgor is not in material default of any
of its obligations thereunder and, (A) other than the parties to such licenses
or licensing agreements, or (B) in the case of any non-exclusive license or
license agreement entered into by Pledgor or any such licensor regarding such
U.S. Trademark, the parties to any other such non-exclusive licenses or license
agreements entered into by Pledgor or any such licensor with any other Person,
no other Person has any rights in or to any of the U.S. Trademark Collateral.

                  (d) No Infringement. To the best of Pledgor's knowledge, (i)
no material infringement or unauthorized use presently is being made of any of
the U.S. Trademark Collateral by any Person, and (ii) the past, present, and
contemplated future use of the U.S. Trademark Collateral by Pledgor has not,
does not and will not infringe upon or violate any right, privilege, or license
arrangement of or with any other Person or give such Person the right to
terminate any such license arrangement.

                  (e) Powers. Pledgor has the unqualified right, power and
authority to pledge and to grant to Secured Party security interests in the U.S.
Trademark Collateral pursuant to this Agreement, and to execute, deliver and
perform its obligations in accordance with the terms of this Agreement, without
the consent or approval of any other Person except as already obtained.

            5. Covenants. So long as any of the Secured Obligations remain
unsatisfied, Pledgor agrees: (i) that it will comply in all material respects
with all of the covenants, terms and provisions of this Agreement, and (ii) that
it will promptly give Secured Party written notice of the occurrence of any
event that could have a material adverse effect on any of the U.S. Trademarks
and the U.S. Trademark Collateral, including any petition under any
bankruptcy-related laws filed by or against any licensor (other than a
Franchisee) of any of the U.S. Trademarks for which Pledgor is a licensee.

            6. Future Rights. For so long as any of the Secured Obligations
shall remain outstanding, or, if earlier, until Secured Party shall have
released or terminated, in whole but not in part, its interest in the Trademark
Collateral, if and when Pledgor shall obtain rights to any new Trademarks, or
any reissue, renewal or extension of any Trademarks, the provisions of Section 2
shall automatically apply thereto and Pledgor shall give to Secured Party prompt
notice thereof. Pledgor shall do all things reasonably deemed necessary by
Secured Party in the exercise of its discretion to ensure the validity,
perfection, priority and enforceability of the security interests of Secured
Party in any future acquired U.S. Trademark Collateral. If Pledgor refuses to
execute and deliver, or fails timely to execute and deliver, any of the
documents it is

                                       6
<PAGE>
requested to execute and deliver by Secured Party in connection herewith,
Pledgor hereby authorizes Secured Party to modify, amend or supplement the
Schedules hereto and to re-execute this Agreement from time to time on Pledgor's
behalf and as its attorney-in-fact to include any future U.S. Trademarks which
are or become U.S. Trademark Collateral and to cause such re-executed Agreement
or such modified, amended or supplemented Schedules to be filed with the PTO.

            7. Duties of Secured Party. Notwithstanding any provision contained
in this Agreement, Secured Party shall have no duty to exercise any of the
rights, privileges or powers afforded to it and shall not be responsible to
Pledgor or any other Person for any failure to do so or delay in doing so.
Except for the accounting for moneys actually received by Secured Party
hereunder or in connection herewith, Secured Party shall have no duty or
liability to exercise or preserve any rights, privileges or powers pertaining to
the Trademark Collateral.

            8. Events of Default. The occurrence of any "Event of Default" under
the Security Agreement shall constitute an Event of Default hereunder.

            9. Remedies. From and after the occurrence and during the
continuation of an Event of Default, Secured Party shall have all rights and
remedies available to it under the Security Agreement and applicable law (which
rights and remedies are cumulative) with respect to the security interests in
any of the Trademark Collateral. Pledgor hereby agrees that such rights and
remedies include the right of Secured Party as a secured party to sell or
otherwise dispose of the Trademark Collateral after default, pursuant to the
UCC. Pledgor hereby agrees that Secured Party shall at all times have such
royalty-free licenses, to the extent permitted by law, for any Trademark
Collateral that is reasonably necessary to permit the exercise of any of Secured
Party's rights or remedies upon or after the occurrence of (and during the
continuance of) an Event of Default with respect to (among other things) any
tangible asset of Pledgor in which Secured Party has a security interest. In
addition to and without limiting any of the foregoing, upon the occurrence and
during the continuance of an Event of Default, Secured Party shall have the
right but shall in no way be obligated to bring suit, or to take such other
action as Secured Party, in the exercise of its discretion, deems necessary, in
the name of Pledgor or Secured Party, to enforce or protect any of the Trademark
Collateral, in which event Pledgor shall, at the request of Secured Party, do
any and all lawful acts and execute any and all documents required by Secured
Party necessary to such enforcement. To the extent that Secured Party shall
elect not to bring suit to enforce such Trademark Collateral, Pledgor, in the
exercise of its reasonable business judgment, agrees to use all reasonable
measures and its diligent efforts, whether by action, suit, proceeding or
otherwise, to prevent the infringement, misappropriation or violation thereof by
others and for that purpose agrees diligently to maintain any action, suit or
proceeding against any Person necessary to prevent such infringement,
misappropriation or violation.

            10. Binding Effect. This Agreement shall be binding upon, inure to
the benefit of and be enforceable by Pledgor and Secured Party and their
respective successors and assigns.

            11. Notices. All notices and other communications hereunder shall be
in writing and shall be mailed, sent or delivered in accordance with the
Security Agreement.

                                       7
<PAGE>
            12. Governing Law. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of Texas,
except to the extent that the validity or perfection of the security interests
hereunder in respect of the Trademark Collateral are governed by federal law, in
which case such choice of Texas law shall not be deemed to deprive Secured Party
of such rights and remedies as may be available under federal law.

            13. Entire Agreement; Amendment. This Agreement and the other Note
Documents, together with the Schedules hereto and thereto, contains the entire
agreement of the parties with respect to the subject matter hereof and supersede
all prior drafts and communications relating to such subject matter. Neither
this Agreement nor any provision hereof may be modified, amended or waived
except by the written agreement of the parties to this Agreement.
Notwithstanding the foregoing, Secured Party may reexecute this Agreement or
modify, amend or supplement the Schedules hereto as provided in Section 6
hereof.

            14. Severability. If one or more provisions contained in this
Agreement shall be invalid, illegal or unenforceable in any respect in any
jurisdiction or with respect to any party, such invalidity, illegality or
unenforceability in such jurisdiction or with respect to such party shall, to
the fullest extent permitted by applicable law, not invalidate or render illegal
or unenforceable any such provision in any other jurisdiction or with respect to
any other party, or any other provisions of this Agreement.

            15. Counterparts; Telefacsimile Execution. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute but one and the same
agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile shall be equally as effective as delivery of an original executed
counterpart of this Agreement. Any party delivering an executed counterpart of
this Agreement by telefacsimile also shall deliver an original executed
counterpart of this Agreement but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Agreement.

            16. Security Agreement. Pledgor acknowledges that the rights and
remedies of Secured Party with respect to the security interest in the Trademark
Collateral granted hereby are more fully set forth in the Security Agreement and
the other Note Documents and all such rights and remedies are cumulative;
provided however that if there is any direct conflict between the provisions of
this Agreement and the provisions of the Security Agreement and the other Note
Documents, the provisions of this Agreement shall prevail.

            17. No Inconsistent Requirements. Pledgor acknowledges that this
Agreement and the other Note Documents may contain covenants and other terms and
provisions variously stated regarding the same or similar matters, and Pledgor
agrees that all such covenants, terms and provisions are cumulative and all
shall be performed and satisfied in accordance with their respective terms;
provided, however, that if there is any direct conflict between the provisions
of this Agreement and the provisions of the Security Agreement and the other
Note Documents, the provisions of this Agreement shall prevail

                                       8
<PAGE>
            18. Termination. Upon the payment and performance in full in cash of
the Secured Obligations, this Agreement shall terminate, and Secured Party shall
execute and deliver such documents and instruments and take such further action
reasonably requested by Pledgor, at Pledgor's expense, as shall be necessary to
evidence termination of the security interest granted by Pledgor to Secured
Party hereunder, including cancellation of this Agreement by written notice from
Secured Party to the PTO.

                            [Signature page follows]

                                       9
<PAGE>
            IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement, as of the date first above written.

                                       SCHLOTZSKY'S FRANCHISOR, LLC, a
                                       Delaware limited liability company

                                       By: /s/ JEFFREY J. WOOLEY
                                           ------------------------
                                       Name: Jeffrey J. Wooley
                                       Title: Senior Vice President

                                       NS ASSOCIATES I, LTD.

                                       BY: NS ASSOCIATES, INC., ITS GENERAL
                                           PARTNER

                                       By: /s/ MORRIS NEWBERGER
                                           ------------------------
                                       Name: Morris Newberger
                                       Title: President
<PAGE>
                                   SCHEDULE A

                           U.S. Trademarks of Pledgor
<PAGE>
          SCHEDULE A TO TRADEMARK SECURITY AGREEMENT - U.S. TRADEMARKS

<TABLE>
<CAPTION>
                                                                                  EXPIRATION   APPLICATION   APPLICATION
  COUNTRY                 MARK             REGISTRATION NO.   REGISTRATION DATE      DATE           NO.          DATE      CLASS NO.
  -------                 ----             ----------------   -----------------   -----------  ------------  -----------   ---------
<S>        <C>                             <C>                <C>                 <C>          <C>           <C>           <C>
U.S. - TX  BUN RUN                              44636             3/12/1985         3/9/2005                                   42
U.S. - TX  BEST BUNS IN TOWN                    45936             2/3/1986          8/3/2006                                   42
U.S. - TX  RUN YOUR BUNS OFF                    44735             4/17/1985         3/9/2006                                   42
U.S. - TX  Miscellaneous Design of Legged
              Bun Running                        44637             3/12/1985         3/9/2005                                  42
U.S.A.     BUN RUN                             1375154           12/10/1985        12/10/2005     526814        3/14/1985      41
U.S.A.     A WHOLE WORLD OF FLAVORS IN
              EVERY BITE                       1385566            3/4/1986          3/4/2006      552444         8/8/1985      42
U.S.A.     TOP BUN                             2239445            4/13/1999        4/13/2005    75/244,484      2/20/1997      30
U.S.A.     SCHLOTZSKY'S DELI                   2235917            3/30/1999        3/30/2005    75/464,596       4/8/1998      42
U.S.A.     SCHLOTZSKY'S and Design
              (with color)                     1252537            9/27/1983        9/27/2013    73/358,062       4/5/1982      42
U.S.A.     SCHLOTZSKY'S                        1775366            6/8/1993          6/8/2013    74/328,161      11/2/1992      29
U.S.A.     AMERICA'S FAVORITE DELI               (-)                 (-)              (-)       76/496,513      3/10/2003      29
U.S.A.     TOP BUN                             1632660            1/22/1991        1/22/2011    73/733,357       6/9/1988      42
U.S.A.     SCHLOTZSKY'S                        1337033            5/21/1985        5/21/2005      505952        10/29/1984     30
U.S.A.     BEST BUNS IN TOWN                   1940035            12/5/1995        12/5/2005    74/622,354      1/17/1995      42
U.S.A.     SCHLOTZSKY'S DELI and Design
             (Home of the Original Logo)       2641418           10/29/2002        10/29/2012   75/464,796       4/8/1998      42
U.S.A.     BAKED FRESH DAILY and Design        1528939            3/7/1989          3/7/2009    73/703,769       1/4/1988      42
U.S.A.     SCHLOTZSKY                          1147774            2/24/1981        2/24/2011    73/184,259       9/1/1978      30
U.S.A.     TOP BUN                             1632407            1/22/1991        1/22/2011    73/733,859      6/13/1988      25
U.S.A.     SERIOUS PIZZA                       1649784            7/2/1991          7/2/2011    74/046,166       4/5/1990      42
U.S.A.     SCHLOTZSKY'S                        1150687            4/7/1981          4/7/2011    73/184,241       9/1/1978      42
U.S.A.     Miscellaneous Design of
              Legged Bun Running               2044593            3/11/1997        3/11/2007    74/648,754      3/20/1995      41
U.S.A.     RUN YOUR BUNS OFF                   1956280            2/13/1996        2/13/2006    74/648,753      3/20/1995      41
U.S.A.     FUNNY NAME. SERIOUS SANDWICH.       2041225            2/25/1997        2/25/2007    74/662,750      4/18/1995      42
U.S.A.     DELI DOLLARS                        2519873           12/18/2001        12/18/2011   76/196,877      1/19/2001      42
U.S.A.     DELI DEAL                           2522315           12/25/2001        12/25/2011   76/196,896      1/19/2001      42
U.S.A.     COOL DELI                           2496141            10/9/2001        10/9/2011    76/127,282      9/13/2000      42
U.S.A.     COOL CLOUD                            (-)                 (-)              (-)       76/451,349      9/17/2002      43*
U.S.A.     EAT LOCALLY. CONNECT GLOBALLY       2734486            7/8/2003          7/8/2013     76/443197      8/23/1992      43
</TABLE>

*     Due to a reorganization of classifications, former Class 42 is now Class
      43

                                                                        12/29/03

                                  Page 1 of 1

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