Warrant Agreement

Restaurant Group PLC
17 November 2004


The Restaurant Group plc
DPP Warrant Agreement, Current Trading Update

DPP Warrant Agreement

In December 2001 The Restaurant Group plc ('TRG') disposed of the Deep Pan Pizza
('DPP') business for a consideration of £3.3m of which £1m was paid on
completion with the balance to be paid on a deferred basis. Since then, a
further £1.8m has been received, leaving an outstanding balance of £500,000.
DPP has faced a challenging trading environment during the latter part of 2004
and has sought to counter this through a programme of estate rationalisation and
in so far as its financial resources have permitted by investing in and
refreshing some restaurants. Throughout this time DPP has enjoyed the continuing
support of its bank and the support of TRG through the facilitation of delayed
settlement of rent.

It is now apparent that in order for DPP to develop as an independent company it
will require the ongoing commitment from TRG to further defer settlement of part
of the outstanding rent balance due to TRG and the remaining £500,000 deferred
consideration. In consideration for agreeing to this further deferral TRG has
been granted a warrant which incorporates an option  (exercisable in certain
specified circumstances) to convert its outstanding £500,000 deferred
consideration balance into new DPP ordinary shares at par . Although the option
is not currently exerciseable and TRG has no current intention of converting the
warrant, were it to do so TRG would gain full control of DPP. In the year to
December 2003 DPP had sales of £22.5M and made a site Ebitda before central
costs in excess of £1.0M.  As at 17 November 2004, the outstanding net balance
on TRG's rent account with DPP was £1.8m.  In the light of these developments
the Board of TRG has made a provision against the full amount of the outstanding
deferred consideration.

Current trading update

TRG has, since its interim announcement in September 2004, continued to enjoy
good trading, with year to date like for like sales in the first 46 weeks of the
year 5% ahead and the Board currently anticipates a satisfactory outcome for the
full year.

17 November 2004

Enquiries:

The Restaurant Group plc                              Tel [phone]
Alan Jackson, Chairman
Andrew Page, Group Managing Director

College Hill                                          Tel: [phone]
Matthew Smallwood

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