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Tax Sharing Agreement - Carlson Holdings Inc. and Carlson Restaurants Worldwide Inc.

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                              TAX SHARING AGREEMENT

         THIS TAX SHARING AGREEMENT ("Agreement") is entered into as of August
19, 1999 by and between Carlson Holdings, Inc., a Minnesota corporation ("CHI")
and Carlson Restaurants Worldwide Inc., a Delaware corporation (Restaurants).
This Agreement supercedes all prior Tax Sharing Agreements entered into
between CHI and Restaurants.

                                    RECITALS

         WHEREAS, CHI is the common parent corporation of an affiliated group of
corporations within the meaning of Section 1504(a) of the Internal Revenue Code
of 1986, as amended (the "Code") and of combined groups as defined under similar
laws of other jurisdictions (the "CHI Group"), and Restaurants and Restaurants'
Affiliates are members of such groups; and

         WHEREAS, the groups of which CHI is the common parent and in which
Restaurants and Restaurants' Affiliates are members, file and intend to file
Consolidated Returns and Combined Returns to the extent required or permitted
under federal, state, and local laws; and

         WHEREAS, CHI and Restaurants desire to agree upon a method for
determining the financial consequences to each party and their subsidiaries
resulting from the filing of a consolidated federal income tax return and the
filing of returns relating to combined state taxes.

                                   AGREEMENTS

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, CHI and Restaurants for
themselves, their successors, and assigns, hereby agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

         Definitions. For purposes of this Agreement, the terms set forth below
shall have the following meanings.

  1.1.     "AUDIT" includes any audit, assessment of Taxes, other examination by
           any Tax Authority, proceeding, or appeal of such proceeding relating
           to Taxes, whether administrative or judicial.

  1.2.     "COMBINED GROUP" means a group of corporations or other entities that
           file a Combined Return.

  1.3.     "COMBINED RETURN" means any Tax Return with respect to Non-Federal
           Taxes filed on a consolidated, combined (including nexus combination,
           worldwide combination, domestic combination, line of business
           combination or any other form of combination) or unitary basis
           wherein one or more members of the Restaurants Group join in the
           filing of a Tax Return with CHI or a CHI subsidiary that is not also
           a member of the Restaurants Group.


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  1.4.     "CONSOLIDATED GROUP" means the affiliated group of corporations
           within the meaning of Section 1504(a) of the Code of which CHI is
           the common parent and which includes the Restaurants Group.

  1.5.     "CONSOLIDATED RETURN" means any Tax Return with respect to Federal
           Income Taxes filed by CHI and its subsidiaries pursuant to Section
           1501 of the Code.

  1.6.     "DECOMBINATION" means any event pursuant to which CHI or the
           Restaurants Group cease to be includible in a Combined Group.

  1.7.     "DECOMBINATION DATE" means the close of business on the day on which
           a Decombination occurs. Unless otherwise required by the relevant
           Tax Authority or a court of competent jurisdiction, CHI and
           Restaurants, for itself and the Restaurants Group, agree to file
           all Tax Returns, and to take all other actions, relating to
           Non-Federal Combined Taxes in a manner consistent with the
           position that Restaurants and its affiliates are included in the
           Combined Group for all days through and including a Decombination
           Date.

  1.8.     "DECONSOLIDATION" means any event pursuant to which CHI or the
           Restaurants Group cease to be includible in the Consolidated Group.

  1.9.     "DECONSOLIDATION DATE" means the close of business on the day on
           which a Deconsolidation occurs. Unless otherwise required by the
           relevant Tax Authority or a court of competent jurisdiction, CHI
           and Restaurants, for itself and the Restaurants Group, agree to
           file all Tax Returns, and to take all other actions, relating to
           Federal Income Taxes in a manner consistent with the position that
           Restaurants and the Restaurants Group are includible in the
           Consolidated Group for all days through and including a
           Deconsolidation Date.

  1.10.    "ESTIMATED TAX INSTALLMENT DATE" means the installment due dates
           prescribed in Section 6655(c) of the Code (presently April 15,
           June 15, September 15 and December 15).

  1.11.    "CHI GROUP" means CHI and its affiliates other than the Restaurants
           Group.

  1.12.    "FEDERAL INCOME TAXES" means any tax imposed under Subtitle A of
           the Code (including the taxes imposed by Sections 11, 55, 59A and
           1201(a) of the Code), including any interest, addition to tax, or
           penalties applicable thereto, and any other income-based United
           States federal taxes which are hereinafter imposed upon
           corporations.

  1.13.    "FINAL DETERMINATION" means (a) the final resolution of any tax
           (or other matter) for a taxable period, including any related
           interest or penalties, that, under applicable law, is not subject
           to further appeal, review


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           or modification through proceedings or otherwise, including (1)
           the expiration of a statute of limitations (giving effect to any
           extension, waiver or mitigation thereof) or a period for the
           filing of claims for refunds amended returns, appeals from adverse
           determinations, or recovering any refund (including by offset),
           (2) a decision, judgment, decree, or other order by a court of
           competent jurisdiction, which has become final and unappealable,
           (3) a closing agreement or an accepted offer in compromise under
           Section 7121 or 7122 of the Code, or comparable agreements under
           laws of other jurisdictions, (4) execution of an Internal Revenue
           Service Form 870 or 870AD, or by a comparable form under the laws
           of other jurisdictions (excluding, however, any such form that
           reserves (whether by its terms or by operation of law) the right
           of the Tax Authority to assert a further deficiency), or (5) any
           allowance of a refund or credit, but only after the expiration of
           all periods during which such refund or credit may be recovered
           (including by way of offset) or (b) the payment of tax by any
           member of the Consolidated Group or Combined Group with respect to
           any item disallowed or adjusted by a Tax Authority provided CHI
           determines no action should be taken to recoup such payment but
           only after consultation with Restaurants regarding any issues
           pertaining to the Restaurants Group.

  1.14.    "RESTAURANTS' AFFILIATE" means any corporation or other entity
           directly or indirectly owned or controlled by Restaurants, as of
           the date of execution of this Agreement, which is includible in
           the Restaurants Group.

  1.15.    "RESTAURANTS GROUP" means the affiliated group of corporations as
           defined in Section 1504(a) of the Code, or similar group of
           entities as defined under similar laws of other jurisdictions,
           including Restaurants and Restaurants' affiliates, of which
           Restaurants is deemed to be the common parent, and any corporation
           or other entity which may have been, may be, or may become a
           member of such group from time to time.

  1.16.    "RESTAURANTS GROUP COMBINED TAX LIABILITY" means, with respect to
           any taxable year, the Restaurants Group's liability for
           Non-Federal Combined Taxes as determined under Section 2.3 of this
           Agreement.

  1.17.    "RESTAURANTS GROUP FEDERAL INCOME TAX LIABILITY" means with
           respect to any taxable year, the Restaurants Group's liability for
           Federal Income Taxes as determined under Section 2.2 of this
           Agreement.

  1.18     "NON-FEDERAL COMBINED TAXES" means any Non-Federal Income Taxes with
           respect to which a Combined Return is filed.

  1.19.    "NON-FEDERAL SEPARATE TAXES" means any Non-Federal Income Taxes that
           are not Non-Federal Combined Taxes.

  1.20.    "NON-FEDERAL INCOME TAXES" includes all federal taxes not imposed
           under Subtitle A of the Code and all state, local, and foreign
           taxes, charges, fees, levies, imposts, duties, or other
           assessments of a similar


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           nature, including, without limitation, income, alternative or
           add-on minimum, gross receipts, excise, employment, sales, use,
           transfer, license, payroll, franchise, severance, stamp,
           occupation, windfall profits, withholdings, unemployment,
           disability, ad valorem, highway use, commercial rent, capital
           stock, paid up capital, recording, registration, property, real
           property gains, value added, business license, custom duties, or
           other tax or governmental fee of any kind whatsoever, imposed or
           required to be withheld by any domestic Tax Authority (excluding
           any federal governmental agency of the United States), including
           any interest, additions to tax, or penalties applicable thereto.

  1.21.    "POST-DECONSOLIDATION PERIOD" means a taxable period beginning after
           the Deconsolidation Date.

  1.22.    "PRE-DECONSOLIDATION PERIOD" means a taxable period ending on or
           prior to the Deconsolidation Date.

  1.23.    "PRO FORMA RESTAURANTS GROUP COMBINED RETURN" means a Pro Forma
           Restaurants Group Combined Return prepared pursuant to Section 2.3
           of this Agreement.

  1.24.    "PRO FORMA RESTAURANTS GROUP CONSOLIDATED RETURN" means a Pro
           Forma Restaurants Group Consolidated Return prepared pursuant to
           Section 2.2 of this Agreement.

  1.25.    "REDETERMINATION AMOUNT" means, with respect to any taxable year, the
           amount determined under Section 3.7 of the Agreement.

  1.26.    "SPECIAL TAX ATTRIBUTES" means any net operating loss, net capital
           loss, investment tax credit, foreign tax credit, targeted jobs tax
           credit, work opportunity tax credit, credit for increasing
           research activities, charitable deduction or any other deduction,
           credit or tax attribute which could reduce taxes (including
           without limitation deductions and credits related to alternative
           minimum taxes).

  1.27.    "STRADDLE PERIOD" means a taxable period beginning on or prior to and
           ending after the Deconsolidation or Decombination Date.

  1.28.    "TAX AUTHORITY" means the Internal Revenue Service and any state,
           local, or other governmental authority responsible for the
           administration of any Taxes.

  1.29.    "TAXES" means Federal Income Taxes and Non-Federal Income Taxes.

  1.30.    "TAX RETURN" means any return, declaration, statement, report,
           schedule, certificate, form, information return or any other
           document (and any related or supporting information) including an
           amended tax return required to be supplied to, or filed with, a
           Tax Authority with respect to Taxes.


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SECTION 2.  TAX SHARING

  2.1.     RESTAURANTS' LIABILITY FOR FEDERAL INCOME TAXES AND NON-FEDERAL
           COMBINED TAXES. With respect to each taxable year in which
           Restaurants is a member of the CHI Consolidated Group or a CHI
           Combined Group, Restaurants shall pay to CHI (or CHI shall pay to
           Restaurants) in accordance with the procedures set forth in
           Section 3, an amount equal to the sum of the Restaurants Group
           Federal Income Tax Liability (or refund) and the Restaurants Group
           Combined Tax Liability (or refund) for such taxable year.

  2.2.     RESTAURANTS GROUP FEDERAL INCOME TAX LIABILITY FOR CONSOLIDATED
           RETURN YEARS.

           (a)    IN GENERAL. With respect to any taxable year for which CHI and
                  Restaurants file a Consolidated Return, the Restaurants Group
                  Federal Income Tax Liability shall be the sum, for such
                  taxable year, of (1) the Restaurants Group's liability for
                  Federal Income Taxes as determined on the Pro Forma
                  Restaurants Group Consolidated Return, and (2) any interest,
                  penalties and other additions applicable to such taxes.

           (b)    PRO FORMA FEDERAL RETURN. With respect to each taxable year,
                  Restaurants shall prepare or cause to be prepared a pro forma
                  consolidated federal income tax return for the Restaurants
                  Group ("Pro Forma Restaurants Group Consolidated Return") as
                  if (except as provided in Section 2.2(c)) the Restaurants
                  Group was not, nor ever was a part of the Consolidated Group,
                  but rather was a separate affiliated group of corporations,
                  consisting of Restaurants and Restaurants' Affiliates of which
                  Restaurants was the common parent filing a consolidated
                  federal income tax return pursuant to Section 1501 of the
                  Code.

           (c)    OPERATING RULES. The Pro Forma Restaurants Group Consolidated
                  Return shall be prepared:

                  (1)      reflecting the elections, methods of accounting, and
                           positions with respect to specific items to be made
                           or used in the Consolidated Return;


                  (2)      giving effect to any deduction or credit for any
                           Restaurants Special Tax Attribute as determined on
                           the Pro Forma Restaurants Group Consolidated Return.
                           In addition, Restaurants shall receive the benefit of
                           any deduction or credit for any Restaurants Special
                           Tax Attributes for which a tax benefit is actually
                           received in a Consolidated Return, but for this
                           purpose, if the Restaurants Group and the CHI Group
                           contribute like Special Tax Attributes to a
                           Consolidated Return (not necessarily in the same
                           taxable year) which are partially or fully limited
                           under the Code, then Restaurants


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                           shall only receive benefit for such like Special
                           Tax Attributes based on a ratio of their Special
                           Tax Attributes to the total Special Tax Attributes
                           of the Consolidated Group. If a Special Tax
                           Attribute is limited by the above, the Restaurants
                           Group shall be entitled to utilize such Special
                           Tax Attribute to the extent allowed when carried
                           forward or carried back to a Pro Forma Restaurants
                           Group Consolidated Return;

                  (3)      applying the top marginal income tax rate used in the
                           Consolidated Return without regard to the graduated
                           tax brackets in Code Sec. 11(b) (the top marginal
                           rate is currently 35 percent);

                  (4)      reflecting transactions with members of the
                           Consolidated Group that are not also members of the
                           Restaurants Group as if such transactions were not
                           with members of the same Consolidated Group;

                  (5)      reflecting deductions for Non-Federal Combined Taxes
                           estimated as provided for in Section 2.3 of this
                           Agreement;

                  (6)      reflecting no allocation of other special items
                           allowed under the Code such as the amounts under
                           Sections 1561(a)(2), 1561(a)(3), and 179(d)(2),
                           unless CHI specifically approves an allocation to
                           Restaurants.

  2.3.     RESTAURANTS GROUP COMBINED TAX LIABILITY

           (a)    IN GENERAL. With respect to any taxable year in which
                  Restaurants participates in the filing of a Combined Return
                  with CHI, the Restaurants Group Combined Tax Liability shall
                  be the sum, for such taxable years, of (1) the Restaurants
                  Group's liability for Non-Federal Income Taxes as determined
                  on the Pro Forma Restaurants Group Combined Returns, and (2)
                  any interest, penalties and other additions applicable to
                  Restaurants Group's liability.

           (b)    PRO FORMA COMBINED RETURNS. Each taxable year, Restaurants
                  shall prepare or cause to be prepared pro forma combined tax
                  returns or other schedule for the Restaurants Group ("Pro
                  Forma Restaurants Group Combined Returns") determined as if
                  the Restaurants Group was not and never was part of the
                  Combined Group, but rather was a separate group of which
                  Restaurants was the common parent filing combined tax returns.

           (c)    OPERATING RULES. The Pro Forma Restaurants Group Combined
                  Returns shall be prepared by reference to:

                  (1)      the Restaurants Group's taxable income or loss from
                           Line 28


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                           (or other similar line representing taxable
                           income before net operating loss deduction and
                           special deductions) of the Pro Forma Restaurants
                           Group Consolidated Return, adjusted to take into
                           account (i) those members of the Restaurants Group
                           which are included in the Combined Return, (ii)
                           Restaurants Group Special Tax Attributes; and (iii)
                           material adjustments necessary to reflect the laws of
                           the applicable jurisdiction;

                  (2)      apportionment factors determined by taking into
                           account only those members of the Restaurants Group
                           which are included in the Combined Return;

                  (3)      the applicable tax rate(s) imposed by each
                           jurisdiction; and

                  (4)      the fact that if a Restaurants Group Special Tax
                           Attribute cannot be fully utilized in the Pro Forma
                           Restaurants Group Combined Return, the Restaurants
                           Group will only be able to realize a benefit from
                           such Special Tax Attribute to the extent it is
                           allowed to utilize such Special Tax Attribute when
                           carried forward or carried back to a Pro Forma
                           Restaurants Group Combined Return in future or prior
                           years.

  2.4.     ALLOCATION OF OTHER SPECIAL ITEMS REQUIRED UNDER THE
           CODE

           In the event of a Deconsolidation after which period CHI and
           Restaurants remain members of a controlled group as defined in
           Section 1563 of the Code, all allocations of special items such as
           those required under Sections 179 and 1561 shall be allocated to
           CHI unless a specific allocation to Restaurants is approved by CHI.

           SECTION 3.  PAYMENT OF TAXES AND SHARING AMOUNTS

  3.1.     FEDERAL INCOME TAXES. CHI shall timely file the Consolidated
           Return and pay timely to the Internal Revenue Service all Federal
           Income Taxes, if any, of the Consolidated Group (including the
           Restaurants Group) due and payable for all Pre-Deconsolidation
           Periods.

  3.2.     NON-FEDERAL COMBINED TAXES. CHI shall timely file all Combined
           Returns and pay timely to the appropriate Tax Authorities all
           Non-Federal Combined Taxes, if any, of the Combined Group
           (including the Restaurants Group) due and payable for all
           Pre-Decombination Periods and Straddle Periods.

  3.3.     NON-FEDERAL SEPARATE TAXES. Restaurants shall pay timely to the
           appropriate Tax Authorities all Non-Federal Separate Taxes, if
           any, of the Restaurants Group due and payable for all
           Pre-Deconsolidation Periods and Straddle Periods.

  3.4.     OTHER FEDERAL TAXES. The parties shall each pay timely to the
           appropriate governmental authorities all of their respective other
           federal taxes (excluding Federal Income Taxes for
           Pre-Deconsolidation Periods,


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           which are governed by Section 3.1. of this Agreement), if any, due
           and payable for all Pre-Deconsolidation Periods, Straddle Periods,
           and Post-Deconsolidation Periods.

  3.5.     TAX SHARING INSTALLMENT PAYMENTS

           (a)    FEDERAL INCOME TAXES. At each Estimated Tax Installment Date
                  with respect to any Pre-Deconsolidation Period or Straddle
                  Period, Restaurants shall determine under Section 6655 of the
                  Code the estimated amount of the related installment of the
                  Restaurants Group Federal Income Tax Liability and shall then
                  pay to CHI the amount thus determined. In addition, the
                  provisions of this Section 3.5(a) shall apply to any Federal
                  Income Tax payment made with the filing of the extension of
                  the Consolidated Return.

           (b)    NON-FEDERAL COMBINED TAXES. At each Estimated Tax Installment
                  Date with respect to any Pre-Decombination Period or Straddle
                  Period, Restaurants shall determine the estimated amount of
                  the related installment of the Restaurants Group Non-Federal
                  Combined Income Tax Liability and shall then pay to CHI the
                  amount thus determined. In addition, the provisions of this
                  Section 3.5(b) shall apply to any Non-Federal Combined Income
                  Tax payment made with the filing of the extension of the
                  Non-Federal Combined Returns.

  3.6.     TAX SHARING TRUE UP PAYMENTS

           (a)    FEDERAL INCOME TAXES. An amount equal to the difference, if
                  any, between the Restaurants Group Federal Income Tax
                  Liability for such taxable year as shown on the Pro Forma
                  Restaurants Group Consolidated Return and the aggregate amount
                  paid by Restaurants with respect to such taxable year under
                  Section 3.5(a) of this Agreement shall be paid to CHI (or paid
                  to Restaurants as the case may be) on or before the due date
                  of the CHI Consolidated Returns.

           (b)    NON-FEDERAL COMBINED TAXES. An amount equal to the difference,
                  if any, between the Restaurants Group Non-Federal Combined
                  Income Tax Liability for such taxable year as shown on the Pro
                  Forma Restaurants Group Combined Returns and the aggregate
                  amount paid by the Restaurants with respect to such taxable
                  year under Section 3.5(b) of this Agreement shall be paid to
                  CHI (or paid to Restaurants as the case may be) on or before
                  the due date of the CHI Non-Federal Combined Returns.

  3.7.     REDETERMINATION AMOUNTS

           (a)    IN GENERAL. In the event of any redetermination of any item of
                  income, gain, loss, deduction or credit of any member of the
                  Consolidated Group or Combined Group as a result of a Final
                  Determination or any settlement or compromise with any Tax


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                  Authority (including any amended tax return or claim for
                  refund filed by CHI), Restaurants shall pay CHI or CHI shall
                  pay Restaurants as the case may be, the Redetermination
                  Amount.

           (b)    CONSULTATION. CHI shall consult with Restaurants prior to
                  settlement or payment regarding the proposed redetermination
                  of any item mentioned in (a) above consistent with prior
                  practices.

           (c)    COMPUTATION. The Redetermination Amount shall be the
                  difference, if any, between all amounts previously determined
                  under Section 2 of this Agreement and all amounts that would
                  have been determined under Section 2 of this Agreement taking
                  such redetermination into account (including any additions to
                  tax or penalties applicable to Restaurants Group's liability),
                  together with interest for each day calculated (1) with
                  respect to redeterminations affecting Federal Income Taxes, at
                  the rate determined, in the case of payment by Restaurants
                  (relating to underpayments of tax by Restaurants), under
                  Section 6621(a)(2) of the Code and, in the case of payment by
                  CHI (relating to overpayments of tax by Restaurants), under
                  Section 6621(a)(1) of the Code, and (2) with respect to
                  redeterminations affecting Non-Federal Combined Taxes, under
                  similar laws, if any, of other jurisdictions.

           (d)    PAYMENT. CHI shall deliver to Restaurants a schedule
                  reflecting the computation of any Redetermination Amount with
                  respect to any taxable year. Not later than thirty (30) days
                  after the date such schedule is delivered, Restaurants shall
                  review such schedule and shall pay CHI, or CHI shall pay
                  Restaurants, such Redetermination Amount.

  3.8.     INTEREST. Payments under this Section 3 that are not made within
           the prescribed period shall thereafter bear interest at the
           Federal short-term rate established pursuant to Section 6621(b) of
           the Code.

  SECTION 4.   PROCEDURAL MATTERS

  4.1.     AGENT, PREPARATION AND FILING OF RETURNS. Until Deconsolidation or
           Decombination, CHI shall be the sole and exclusive agent of
           Restaurants and any member of the Restaurants Group in any and all
           matters relating to (a) Federal Income Taxes of the Consolidated
           Group and (b) any Non-Federal Combined Taxes for all
           Pre-Deconsolidation Periods, Pre-Decombination Periods and
           Straddle Periods. CHI shall have the sole and exclusive
           responsibility for the preparation and filing of any (a)
           Consolidated Return or (b) Combined Return for all
           Pre-Deconsolidation Periods, Pre-Decombination Periods and
           Straddle Periods. In its sole discretion, but following
           consultation with Restaurants consistent with prior practices, CHI
           shall have the exclusive right with respect to any such
           Consolidated Return or Combined Return (a) to


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           determine (1) the manner in which such Tax Return shall be
           prepared and filed, including, without limitation, the manner in
           which any item of income, gain, loss, deduction or credit shall be
           reported, (2) whether any extensions may be requested, (3) the
           elections that will be made by any member of the Consolidated
           Group or Combined Group, and (4) whether any amended tax returns
           should be filed; (b) to control, contest, and represent the
           interests of the Consolidated Group and Combined Group in any
           Audit and to resolve, settle, or agree to any adjustment or
           deficiency proposed, asserted or assessed as a result of any
           Audit; (c) to file, prosecute, compromise or settle any claim for
           refund; and (d) to determine whether any refunds to which the
           Consolidated Group or Combined Group may be entitled, shall be
           paid by way of refund or credited against the tax liability of the
           Consolidated Group and Combined Group, provided that the refunds
           can be credited to periods that include Restaurants in the
           Consolidated Group and the Combined Group. Restaurants, for itself
           and its subsidiaries, hereby irrevocably appoints CHI as its agent
           and attorney-in-fact to take such action (including the execution
           of documents) as CHI may deem appropriate to effect the above.

  4.2.     FURNISHING INFORMATION. Each member of the Restaurants Group shall
           (a) furnish to CHI in a timely manner such information and
           documents as CHI may reasonably request for purposes of (1)
           preparing any original or amended Consolidated Return or Combined
           Return, (2) contesting or defending any Audit, and (3) making any
           determination or computation necessary or appropriate under this
           Agreement; (b) cooperate in any Audit of any Consolidated Return
           or Combined Return; (c) retain and provide on demand books,
           records, documentation or other information relating to any tax
           return until the later of (1) the expiration of the applicable
           statute of limitations (giving effect to any extension, waiver, or
           mitigation thereof) and (2) in the event any claim is made under
           this Agreement for which such information is relevant, until a
           Final Determination with respect to such claim is made; and (d)
           take such action as CHI may deem appropriate in connection
           therewith. CHI shall provide the Restaurants Group with any
           assistance reasonably required in providing any information
           requested pursuant to this Section 4.2. CHI shall also provide
           Restaurants Group with any assistance or information reasonably
           required by Restaurants related to periods after the
           Deconsolidation Date or the Decombination Date that is necessary
           to compute Federal Income Taxes, Non-Federal Combined Taxes, or
           Non-Federal Separate Taxes of the Restaurants Group. .

  4.3.     EXPENSES. Restaurants shall reimburse CHI for its prorata portion
           of third party legal and accounting expenses incurred by CHI in
           the course of the planning and preparation of any tax returns, the
           conduct of any Audit regarding the tax liability of the
           Consolidated Group or Combined Group, and for any other expense
           incurred by CHI in the course of any litigation relating thereto,
           to the extent such costs are attributable to the Restaurants Group
           and provided CHI has conferred with Restaurants as to the portion
           of such costs relating to the Restaurants Group. Notwithstanding
           the foregoing, CHI shall have the sole discretion, after
           consultation with


                                    Page 10
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           Restaurants consistent with prior practices, to control, contest,
           represent, file, prosecute, challenge or settle any Audit related
           to the Consolidated Return or Combined Returns of CHI.

  SECTION 5.   DECONSOLIDATION / DECOMBINATION

  5.1.     CONTINUING COVENANTS. Restaurants, for itself and the Restaurants
           Affiliates, covenants that on or after a Deconsolidation or
           Decombination it will not, nor will it cause or permit any member
           of the Restaurants Group to, make or change any tax election,
           change any accounting method, amend any tax return or take any tax
           position on any tax return, take any action, omit to take any
           action or enter into any transaction that results in any increased
           tax liability or reduction of any Special Tax Attributes of the
           Restaurant Pre-Deconsolidation Period, Pre-Decombination Period or
           Straddle Period without consultation with CHI.

  5.2.     REATTRIBUTION OF SPECIAL TAX ATTRIBUTES. In the event of
           Deconsolidation or Decombination, CHI may, at its option, elect to
           reattribute to itself certain Special Tax Attributes of the
           Restaurants Group pursuant to Treasury Regulations Section
           1.1502-20(g) or similar provisions of other jurisdictions. If CHI
           makes such an election after consultation with Restaurants,
           Restaurants shall comply with any applicable requirements,
           including those of Treasury Regulations Section 1.1502-20(g)(5).
           CHI also agrees to reimburse Restaurants for any additional tax
           liabilities that result from such elections.

  5.3.     CARRYBACKS. CHI agrees to pay Restaurants the actual tax benefits
           received by the CHI Group from the use in any Pre-Deconsolidation
           Period or Pre-Decombination Period of a carryback of any Special
           Tax Attributes of the Restaurants Group from a
           Post-Deconsolidation Period or Post-Decombination Period. Such
           benefit shall be considered equal to the benefit Restaurants would
           have received had such Special Tax Attributes arisen in a
           Pre-Deconsolidation Period or Pre-Decombination Period. Payment of
           the amount of such benefit shall be made within ninety (90) days
           of the filing of the applicable tax return for the taxable year in
           which the Special Tax Attributes are utilized.

           If subsequent to the payment by CHI to Restaurants of any such
           amount, there shall be (a) a Final Determination which results in
           a disallowance or a reduction of the Special Tax Attributes so
           carried back or (b) a reduction in the amount of the benefit
           realized by the CHI Group as a result of any other Special Tax
           Attributes that arise in a Post-Deconsolidation Period or
           Post-Decombination Period, Restaurants shall receive support for
           such disallowance or reduction in writing, and shall repay to CHI
           within ninety (90) days of such event, an amount which would not
           have been payable to Restaurants pursuant to their Section 5.3 had
           the amount of the benefit been determined in light of these
           events. Restaurants shall hold CHI harmless for any penalty,
           addition to tax, or interest payable by any member of the CHI
           Group as a result of any such event unless Restaurants objects to
           the decision made by CHI regarding the carryback of the Special
           Tax Attributes or to the Final Determination agreed to by CHI
           regarding


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<PAGE>

           the assessment of any penalty, addition to tax, or interest. Any
           such amount shall be provided to Restaurants in writing and shall
           be paid by Restaurants to CHI within ninety (90) days after notice
           to Restaurants of the payment by CHI or any member of the
           Consolidated Group or Combined Group of any such penalty, addition
           to tax, or interest. Nothing in this Section 5.3 shall require CHI
           to file a claim for refund of Federal Income Taxes or Combined
           Taxes.

  SECTION 6.   DISPUTES

  6.1.     ACCOUNTING FIRM. If the parties are unable to agree on the amount
           which is allocable or due to one party from the other under this
           Agreement (including any payments due under Section 3.5, 3.6 or
           3.7), or on whether an action or failure to act has the effect of
           minimizing taxes, then either party may invoke this procedure by
           giving notice to the other. Upon receipt of such notice, the
           parties shall select and notify a single public accounting firm to
           resolve the dispute. If the parties cannot agree on a single firm
           within ten (10) days, they shall each select a nationally
           recognized public accounting firm, which may include the public
           accounting firm which regularly opines on either party's financial
           statements ("Auditor"). Those two firms shall jointly select and
           notify, within ten (10) days, a third independent nationally
           recognized public accounting firm, which shall not be the Auditor
           of either CHI or Restaurants, to resolve the dispute.

  6.2.     RESOLUTION OF DISPUTE. The chosen public accounting firm (the
           "Arbitrator") shall be provided with written arguments by each
           party and all supporting documents which each party deems
           necessary within thirty (30) days of selection of the Arbitrator.
           Each party shall provide the other party with copies of all
           written arguments, documents, and correspondence submitted to the
           Arbitrator. Either party may discuss the issues with the
           Arbitrator provided the other party is given the opportunity to be
           present. Within sixty (60) days of any oral arguments or the last
           written arguments, whichever is later, the Arbitrator shall notify
           the parties of its decision. If in the opinion of the Arbitrator,
           an expedited decision is necessary to protect either party's
           rights, the Arbitrator shall accelerate the dates for submissions,
           arguments and decision so as to protect the rights of the parties.

  6.3.     BINDING RESOLUTION. The determination made by the Arbitrator under
           Section 6.2 hereof shall be conclusive and binding upon the
           parties and shall not be subject to appeal, except in the case of
           manifest mathematical error.

  6.4.     COSTS OF DISPUTE RESOLUTION. The parties shall share equally in all
           fees and costs of the Arbitrator.


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<PAGE>

  SECTION 7.   MISCELLANEOUS

  7.1.     TERM

           (a)    FEDERAL INCOME TAXES. The portions of this agreement relating
                  to Federal Income Taxes shall expire upon the Deconsolidation
                  Date; provided, however, that all rights and obligations
                  arising hereunder with respect to a Pre-Deconsolidation Period
                  or Straddle Period shall survive until they are fully
                  effectuated or performed and, provided, further, that
                  notwithstanding anything in this Agreement to the contrary,
                  all rights and obligations arising hereunder with respect to a
                  Post-Deconsolidation Period shall remain in effect and its
                  provisions shall survive for the full period of all applicable
                  statutes of limitation (giving effect to any extension, waiver
                  or mitigation thereof).

           (b)    NON-FEDERAL COMBINED TAXES. Not withstanding that a
                  Deconsolidation Date occurs for Federal Income Tax, if such
                  date does not represent a Decombination Date for Non-Federal
                  Combined taxes, the portions of this Agreement relating to
                  Non-Federal matters shall remain in effect.

  7.2.     ALLOCATIONS. All computations with respect to the
           Pre-Deconsolidation Period ending on the Deconsolidation Date, the
           immediately following taxable period of Restaurants and the
           Restaurants Group, and any Straddle Period shall be made pursuant
           to the principles of Treasury Regulations Section 1.1502-76(b),
           taking into account such elections thereunder as CHI, in its sole
           discretion but after consultation with Restaurants, shall make.

  7.3.     CHANGES IN LAW. Any reference to a provision of the Code or a
           similar law of another jurisdiction shall include a reference to
           any successor provision to such provision.

  7.4.     CONFIDENTIALITY. Each party shall hold and cause its advisors and
           consultants to hold in strict confidence, unless compelled to
           disclose by judicial or administrative process or, in the opinion
           of its counsel, by other requirements of law, all information
           (other than any such information relating solely to the business
           or affairs of such party) concerning the other parties hereto
           furnished it by such other party or its representatives pursuant
           to this Agreement (except to the extent that such information can
           be shown to have been (a) previously known by the party to which
           it was furnished, (b) in the public domain through no fault of
           such party, or (c) later lawfully acquired from other sources not
           under a duty of confidentiality by the party to which it is
           furnished), and each party shall not release or disclose such
           information to any other person except its auditors, attorneys,
           financial advisors, bankers and other consultants who shall be
           advised of and agree to be bound by the provisions of this Section


                                    Page 13
<PAGE>

           7.4. Each party shall be deemed to have satisfied its obligation
           to hold confidential information concerning or supplied by the
           other party if it exercises the same care as it takes to preserve
           confidentiality for its own similar information.

  7.5.     SUCCESSORS. This Agreement shall be binding on and inure to the
           benefit of any successor, by merger, acquisition of assets or
           otherwise, to any of the parties hereto (including any successor
           of CHI and Restaurants succeeding to the tax attributes of such
           party under Section 381 of the Code), to the same extent as if
           such successor had been an original party.

  7.6.     AUTHORIZATION, ETC. Each of the parties hereto hereby represents
           and warrants that it has the power and authority to execute,
           deliver and perform this Agreement, that this Agreement has been
           duly authorized by all necessary corporate action on the part of
           such party, that this Agreement constitutes a legal, valid and
           binding obligation of each such party and that the execution,
           delivery and performance of this Agreement by such party does not
           contravene or conflict with any provision of law or of its charter
           or bylaws or any agreement, instrument or order binding on such
           party.

  7.7.     ENTIRE AGREEMENT. This Agreement contains the entire agreement
           among the parties hereto with respect to the subject matter hereof
           and supersedes all prior agreements.

  7.8.     SECTION CAPTIONS. Section captions used in this Agreement are for
           convenience and reference only and shall not affect the
           construction of this Agreement.

  7.9.     GOVERNING LAW. This Agreement shall be governed by and construed in
           accordance with the laws of the State of Minnesota without giving
           effect to laws and principles relating to conflicts of law.

  7.10.    COUNTERPARTS. This Agreement may be executed in any number of
           counterparts, each of which shall be deemed an original, but all of
           which together shall constitute one and the same Agreement.

  7.11.    WAIVERS AND AMENDMENTS. This Agreement shall not be waived, amended
           or otherwise modified except in writing, duly executed by all of the
           parties hereto.

  7.12.    SEVERABILITY. In case any one or more of the provisions in this
           Agreement should be invalid, illegal or unenforceable, the
           enforceability of the remaining provisions hereof will not in any
           way be affected or impaired thereby.

  7.13.    NO THIRD PARTY BENEFICIARIES. This Agreement is solely for the
           benefit of the parties to this Agreement and the other members of
           the Consolidated Group and should not be deemed to confer upon
           third parties any remedy, claim, liability, reimbursement, cause
           of action or other rights in excess of those existing without this
           Agreement.


                                    Page 14
<PAGE>

         IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed by a duly authorized officer as of the date first above
written.



               CARLSON HOLDINGS, INC.

               BY:    /s/ Martyn R. Redgrave
                      -------------------------------------------------------

               NAME:  Martyn R. Redgrave
                      -------------------------------------------------------

               TITLE: Executive Vice President and CFO
                      -------------------------------------------------------



               CARLSON RESTAURANTS WORLDWIDE INC.

               BY:    /s/ Wallace B. Doolin
                      -------------------------------------------------------

               NAME:  Wallace B. Doolin
                      -------------------------------------------------------

               TITLE: President and CEO
                      -------------------------------------------------------






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