The Compensation Committee (the Committee) of the Board of Directors (the Board) of Einstein Noah Restaurant Group, Inc. (the Company) is established pursuant to the Company’s By-laws and Section 141(c) of the Delaware General Corporation Law.

The purpose of the Committee is (i) to perform the functions described below under “Committee Duties and Responsibilities” in order to discharge the Board’s responsibilities relating to compensation of the Company’s executives and (ii) to prepare an annual report on executive compensation for inclusion in the Company’s annual proxy statement, in accordance with applicable rules and regulations of the Securities and Exchange Commission (SEC).

In pursuing its purpose the Committee shall ensure that a proper system of longterm and short-term compensation is in place for management, and that compensation plans are appropriate and competitive and properly reflect the objectives and performance of management and the Company.

The Committee shall be comprised of at least two members of the Board each of whom has been affirmatively determined in the judgment of the Board to qualify as independent directors under the rules of the National Association of Securities Dealers applicable to The Nasdaq Stock Market, Inc. Each Committee member must also be a “non-employee director” as defined in Rule 16b-3 under the Securities Exchange Act of 1934, as amended, and an “outside director” within the meaning of Section 162(m) of the Internal Revenue Code. The Board shall designate the Chairperson of the Committee, provided that if the Board does not so designate a Chairperson, the members of the Committee, by majority vote, may designate a Chairperson.

Any vacancy in the Committee from the members designated in the resolutions electing Committee members shall be filled by majority vote of the Board at the next meeting of the Board following the occurrence of the vacancy. No member of the Committee shall be removed except by majority vote of the Board.

The timing and frequency of the Committee meetings will be determined by the Committee; however, the Committee will meet at least once each year. The presence in person or by telephone of a majority of the Committee’s members shall constitute a quorum for any meeting of the Committee. All actions of the Committee will require the vote of a majority of its members present at the meeting of the Committee at which a quorum is present. The Committee, at its discretion, may ask members of management, the Company’s counsel, or others to attend its meetings (or portions thereof) and to provide pertinent information as necessary; provided however, that the Chief Executive Officer may not be present during the Committee’s deliberations or voting processes with respect to setting and approving any aspect of the compensation of the Chief Executive Officer.

The Committee’s duties and responsibilities are to:

1. review and approve all aspects of the compensation of the Company’s executive officers, including their participation in incentive-compensation plans, performance-based compensation and equity-based compensation plans;

2. review and approve corporate goals and objectives relevant to the compensation of the Chief Executive Officer and, after an evaluation of the Chief Executive Officer’s performance in light of those goals and objectives, set the compensation of the Chief Executive Officer (in determining the long-term incentive component of the Chief Executive Officer’s compensation, the Committee should consider, among other factors, the Company’s performance and relative shareholder return, the value of similar incentive awards for chief executive officers at comparable companies and the awards given to the Chief Executive Officer in past years);

3. review, and make periodic recommendations to the Board with respect to, the general compensation, benefits and perquisites policies and practices of the Company, including, without limitation, the Company’s incentive-compensation plans and equity-based compensation plans (in circumstances in which equity-based compensation plans are not subject to shareholder approval, such plans shall be subject to Committee approval);

4. review with management annually the Compensation Discussion and Analysis and make a recommendation to the Board regarding its inclusion in the Company’s annual proxy statement in accordance with the rules and regulations of the SEC;

5. approve the Compensation Committee Report and authorize its inclusion in the Company’s annual proxy statement in accordance with the rules and regulations of the SEC; and

6. report to the Board at least once a year.

The Committee may conduct or authorize surveys or studies of matters within the Committee’s scope of responsibilities as described above, including, but not limited to, surveys or studies of compensation practices in relevant industries, to maintain the Company’s competitiveness and ability to recruit and retain highly qualified personnel, and may retain and terminate, at the expense of the Company, independent counsel or other consultants necessary to assist in any such survey or study. If any compensation consultant or firm is to assist in the evaluation of director, chief executive officer or senior executive compensation, the Committee shall have the sole authority to retain and terminate the compensation consultant or firm and approve such firm or person’s fees and other retention terms.

The Committee shall perform such additional activities, and consider such other matters, within the scope of its responsibilities, as the Committee or the Board deems necessary or appropriate.

02/26/08