Document:

Exhibit
10.25

 

EMPLOYMENT
AGREEMENT

 

This EMPLOYMENT AGREEMENT
(the “Agreement”) is entered effective this 20th day of March, 2002 (the
“Effective Date”), between CHICAGO PIZZA & BREWERY, INC., a California
corporation (the “Company”) and MICHAEL A. NAHKUNST (the “Employee”).

 

WHEREAS, the Board
of Directors of the Company (the “Board”) has approved and authorized the entry
into this Agreement with the Employee; and

 

WHEREAS, the
parties desire to enter into this Agreement setting forth the terms and conditions
for the employment relationship of the Employee with the Company.

 

NOW, THEREFORE, in
consideration of the promises and mutual covenants and agreements herein
contained and intending to be legally bound hereby, the Company and the
Employee hereby agree as follows;

 

1.                                       Employment.   The Employee shall be employed as the Chief Operating
Officer of the Company from March 20, 2002 (the “Commencement Date”), until
such employment is terminated in accordance with this Agreement. The Employee
shall have such duties and responsibilities as may be designated to him by the
Board of Directors of the Company (the “Board”) from time to time. The Employee
shall be generally responsible for overseeing the operations of the Company and
meeting reasonable performance standards and objectives as set by the Board of
Directors.  Employee shall report
directly to the Chief Executive Officer of the Company or his designee.
Employee shall devote substantially all of his time, attention and energies to
the business and affairs of the Company; provided, however, the Company
acknowledges that Employee is an investor and director or LLC manager in the
entities listed on Schedule “A” attached hereto, as described therein and may
continue in such capacities only so long as such activities do not interfere
with the performance of his duties under this Agreement.  Employee may not, however, engage in any
activities in competition with the Company; provided, however, the parties
agree that although Southend may be considered “in competition with the
Company”, Employee may continue to be an investor therein.

 

2.                                       Salary.  The Company shall pay the Employee a
salary at an annual rate of $200,000.00 less applicable deductions (the “Base
Salary), such Base Salary may be increased at such times and in such amounts as
determined by the Board. The Base Salary shall be payable by the Company to the
Employee in substantially equal installments not less frequently than
semi-monthly (two times per month).  Participation in deferred compensation,
mandatory or discretionary bonus, retirement, stock option and other employee
benefit plans and in fringe benefits shall not reduce the Base Salary.

 

3.                                       Bonus. 
During the first full year of Employee’s employment, the Company shall
pay the Employee a bonus of $50,000.00 (less applicable deductions), with said
bonus payable $25,000.00 (net of the amount of all federal, state, or local
income tax and FICA applicable thereto) on the Effective Date , the remaining
amounts payable in three (3) equal installments on the 30th day of June, 2002,
September 2002, and December 2002. 
Thereafter, Employee will be paid quarterly bonuses as determined by the
Board of Directors based upon Employee’s

 

1

 

performance.  Additional discretionary bonuses may be
payable by the Company to the Employee from time to time as determined by the
Board.  Except as otherwise provided in
Section 9 herein, if this Agreement is terminated prior to the payment date of
any bonus provided for in this paragraph, no bonus payment shall be made
following the termination date of the Agreement unless otherwise agreed by the
Company.

 

4.                                       Participation
in Stock Options, Health Insurance, Retirement and Employee Benefit Plans.

 

4.1                                 The
Employee shall receive from the Company on the Commencement Date options to
purchase 150,000 shares of the Company’s Common Stock (the “Initial Options”),
with said options vesting over a five-year period in accordance with the
Company’s 1996 Stock Option Plan (the “Plan”). 
The exercise price of the Initial Options shall be $5.54 per share which
is reflective of  the per share price of
the Company’s Common Stock at the close of trading on the NASDAQ on March 20th,
2002.  The terms of the Initial Options
shall be as provided in the Plan and in the Company’s standard form Incentive
Option Agreement.

 

4.2                                 Employee
and his dependents eligible to receive coverage shall be entitled to
participate in the Company’s health insurance program and the Company shall pay
all premiums for said insurance for Employee and any dependants eligible to
receive coverage under the applicable plans. 
If Employee is not immediately eligible for participation, the Company
will reimburse Employee for any COBRA premiums or comprehensive health
insurance payments made by Employee for him and qualified dependants for the
period until the Employee is eligible for participation.

 

4.3                                 In
addition to the foregoing, the Employee shall be entitled to participate with
other similarly situated executive officers of the Company based on position,
tenure and salary in any plan of the Company relating to stock purchases,
pension, thrift, profit sharing, life insurance, disability insurance,
education, or other retirement or employee benefits that the Company has
adopted or may hereafter adopt for the benefit of its executive officers.

 

5.                                       Automobile.  The Company shall provide the Employee a
car allowance of $750.00 per month, payable on the Commencement Date and on the
1 st day of each calendar month thereafter.  In addition, the Company shall reimburse
Employee for reasonable expenses incurred in operating the vehicle used for
business purposes subject to the provisions of paragraph 7.

 

6.                                       Vacation.  The Employee shall be entitled to a minimum
of three (3) weeks annual paid vacation in accordance with the Company’s
policy, in addition to holidays and other paid time off (excluding vacation)
provided to similarly situated executive officers of the Company.

 

7.                                       Business
Expenses.  During such
time as the Employee is rendering services hereunder, the Employee shall be
entitled to incur and be reimbursed by the Company for all reasonable business
expenses, including but not limited to mobile telephone charges. The

 

2

 

Company agrees that it
will reimburse the Employee for all such expenses upon the presentation by the
Employee, on a monthly basis, of an itemized account of such expenditures
setting forth the date, the purposes for which incurred, and the amounts
thereof, together with such receipts showing payments in conformity with the
Company’s established policies. 
Reimbursement for approved expenses shall be made within a reasonable
period not to exceed 30 days after the approval of Employee ‘s an itemized
account.

 

8.                                       Indemnity.  The Company shall to the extent permitted by
law, indemnify and hold the Employee harmless from costs, expense or liability
arising out of or relating to any acts or decisions made by the Employee in the
course of his employment to the same extent the Company indemnifies and holds
harmless other officers and directors of the Company in accordance with the
Company’s established policies. The Company agrees to continuously maintain
Directors and Officers Liability Insurance with reasonable limits of coverage
and to include the Employee within said coverage.

 

9.                                       Termination.  This Agreement shall terminate on the third
anniversary date of the Commencement Date, unless sooner pursuant to any of the
following:

 

9.1                                 Death.  This Agreement shall terminate upon the
Employee’s death. The Company shall pay the Employee’s estate (i) on the date
it would have been payable to Employee any unpaid Base Salary earned prior to
the date of Employee’s death, (ii) within 30 days of the conclusion of the
quarter following Employee’s death, any unpaid Bonus prorated to the date of
Employee’s death, and (iii) any unpaid reimbursements due Employee for expenses
incurred by the Employee prior to Employee’s death, upon receipt from the
Employee’s personal representative of receipts therefore.  Any Initial Options and subsequent options
that have not vested as of the date of Employee’s death shall terminate on the
date of Employee’s death.

 

9.2                                 Disability.  If, as a result of the Employee’s incapacity
due to physical or mental illness, he shall have been absent from the full time
performance of substantially all of his material duties with the Company for 90
consecutive days or 180 days total within any 12-month period, his employment
may be terminated by the Company for “Disability.” Termination shall occur 30
days after a notice of a written termination is delivered to Employee by the
Company (the “Effective Date of Termination”). The Company shall pay the
Employee (i) on the date it would have been payable to Employee, any unpaid Base
Salary earned prior to the date of Employee’s Effective Date of Termination,
(ii) within 30 days of the end of the quarter following Employee’s Effective
Date of Termination, any unpaid Bonus prorated to the Employee’s last day of
actual employment, (iii) any unpaid reimbursements due Employee for expenses
incurred by the Employee prior to Employee’s Effective Date of Termination,
pursuant to paragraph 7, and (iv) if employee is not covered by any other
comprehensive insurance, the Company will pay Employee an amount equivalent to
Employee’s COBRA payments up to 18 months following the Effective Date of
Termination or the maximum term allowable by then applicable law for coverage
of Employee and his eligible dependents. Any Initial Options and subsequent options
that have not vested as of the Employee’s Effective Date of Termination shall
terminate on the date of Employee’s Effective Date of Termination.

 

3

 

9.3                                 Cause.  This Agreement may be terminated by the
Company at any time for “Cause” by the delivery to Employee of a written notice
of termination stating the date of termination and the basis upon which this
Agreement is being terminated.  As used
in this Agreement, the term “Cause” shall include:

 

(i)                                     failure,
neglect or refusal to perform or observe any or all of Employee’s material
obligations (“Breach”) under this Agreement which Breach remains uncured after
written notice from the Company to the Employee and an opportunity to correct
such performance within a reasonable period of time as determined by the
Company, of at least fifteen (15) days after notice from the Company regarding
the Breach;

 

(ii)                                  conviction
of Employee of any felony or other crime involving dishonesty or moral
turpitude;

 

(iii)                               fraudulent
conduct by the Employee or any act of dishonesty in connection with the
Company’s business; or

 

(iv)                              unauthorized
or unfair competition with the Company or any of its affiliates, including the
unauthorized use or disclosure of trade secrets, confidential or proprietary
business information or the substantial breach of any material covenants.

 

In the event of termination for Cause, Employee will
be entitled to such Base Salary and benefits as have accrued under this
Agreement through the date of termination, but will not be entitled to any
other salary, benefits, bonuses or other compensation after such date.

 

9.4                                 Without
Cause.  This Agreement
may also be terminated by Company at any time without Cause by the delivery to
Employee of a written notice of termination not less than thirty (30) days
prior to the date of termination.  Upon
such termination, Employee will be paid such Base Salary, vacation, prorated
bonus and other benefits as have been earned under this Agreement through the
date of termination (including, without limitation, the Company will pay
Employee’s COBRA payments for the earlier of the maximum term allowable by then
applicable law or the date Employee becomes covered under a different health
plan, for coverage of Employee and his eligible dependents).  So long as Employee reasonably cooperates in
the transition of Employee’s duties, as determined in the Company’s sole but
reasonable discretion, Employee will be paid an amount equivalent to his
monthly Base Salary, on a monthly basis, for the remaining term of the
Agreement, or six (6) months, whichever is shorter.  Employee will receive the foregoing payment regardless of any
mitigation.  However, Employee
acknowledges that he has a duty to mitigate and seek other employment.  If there are more than six (6) months
remaining on the term of the Agreement, and Employee is unable to secure
comparable employment during the six (6) months following termination, the
Company will continue paying Employee’s Base Salary for the remainder of the term
of the Agreement up to an additional six (6) months, or until Employee secures
comparable employment, whichever is shorter. 
Failure to make reasonable efforts to mitigate will justify cessation of
the payment of the Base Salary under this paragraph. Any Initial Stock Options
and subsequent options that have not vested as of the date of Employee’s
termination, shall fully vest as of the date of Employee’s termination. Except

 

4

 

as provided in this paragraph,
Employee will not be entitled to any other salary, benefits, bonuses or other
compensation after such termination.

 

9.5                                 By
Employee.  Employee may
terminate this Agreement upon 30 days written notice to the Company. The
Company shall pay the Employee (i) on the date it would have been payable to
Employee, any unpaid Base Salary earned prior to the date of Employee ‘s
termination, and (ii) any unpaid reimbursements due Employee for expenses
incurred by the Employee prior to the date of Employee’s termination, pursuant
to paragraphs 5 and 7.  Any Initial
Options and subsequent options that have not vested as of the date of
Employee’s termination shall terminate on the date of Employee’s termination.

 

9.6                                 Expiration
of Term.  If the parties
do not execute a new written agreement, upon expiration of the Term of the
Agreement, the employment of Employee shall continue on the same terms and
conditions (including the then applicable compensation as provided in
paragraphs 2 through 7) as provided in this Agreement.  The parties acknowledge and agree that any
such employment following the Term shall be terminable “at will” for any
reason, with or without cause, pursuant to Section 2922 of the California Labor
Code.

 

10.                                 Assignment.

 

10.1                           This
Agreement may not be assigned by Employee.

 

10.2                           This
Agreement may be assigned by the Company provided that the Company shall
require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company to expressly assume and agree to perform under this
Agreement in the same manner and to the same extent that the Company would be
required to perform as if no such succession had taken place.

 

11.                                 Confidential
Information.

 

11.1                           During
the term of this Agreement and thereafter, the Employee shall not, except as
may be required to perform his duties hereunder or as required by applicable
law or court order, disclose to others for use, whether directly or indirectly,
any Confidential Information regarding the Company. “Confidential Information”
shall mean information about the Company, its subsidiaries and affiliates, and
their respective clients and customers that is not available to the general
public and that was learned by the Employee in the course of his employment by
the Company, including, without limitation, any data, formulae, recipes,
methods, information, proprietary knowledge, trade secrets and client and
customer lists and all papers, resumes, records and other documents containing
such Confidential Information. The Employee acknowledges that such Confidential
Information is specialized, unique in nature and of great value to the Company,
and that such information gives the Company a competitive advantage. Upon the
termination of his employment, the Employee will promptly deliver to the
Company all documents, maintained in any format, including electronic or print,
(and all copies thereof) in his possession containing any Confidential
Information.

 

5

 

11.2                           Noncompetition.  Except as otherwise provided herein, the
Employee agrees that during the term of this Agreement he will not, directly or
indirectly, without the prior written consent of the Company, provide
consulting services with or without pay, or own, manage, operate, join,
control, participate in, or be connected as a stockholder, partner, or
otherwise with any business, individual, partner, firm, corporation, or other
entity which is then in competition with the Company or any present affiliate
of the Company; provided, however, that the “beneficial ownership” by the
Employee, either individually or as a member of a “group,” as such terms are
used in Rule 13d of the General Rules and Regulations under the Securities Exchange
Act of 1934 (“Exchange Act”), of not more than 1 % of the voting stock of any
corporation shall not be a violation of this Agreement.  Notwithstanding the foregoing, the Employee
shall be permitted to maintain the ownership interests and directorship described
on Exhibit “A” attached hereto so long as they do not interfere with the
performance of his duties and do not constitute competitive activities;
provided, however, the parties agree that although Southend may be considered
“in competition with the Company”, Employee may continue to be an investor
therein.

 

11.3                           Right to
Company Materials .  The
Employee agrees that all styles, designs, recipes, lists, materials, books,
files, reports, correspondence, records, and other documents (“Company
Material”) used, prepared, or made available to the Employee, shall be and
shall remain the property of the Company. Upon the termination of his
employment and/or the expiration of this Agreement, all Company Materials shall
be returned immediately to the Company, and Employee shall not make or retain
any copies thereof.

 

11.4                           Antisolicitation.  The Employee understands and agrees that in
the course of employment with the Company, the Employee will obtain access to
and/or acquire Company trade secrets, including Confidential Information, which
are solely the property of the Company. 
Therefore, to protect such trade secrets, the Employee promises and
agrees that during the term of this Agreement, and for a period of two years thereafter,
he will not influence or attempt to influence employees, customers,
franchisees, landlords, or suppliers of the Company or any of its present or
future subsidiaries or affiliates, either directly or indirectly, to divert
their employment or business to or with any individual, partnership, firm,
corporation or other entity then in competition with the business of the
Company, or any subsidiary or affiliate of the Company.

 

11.5                           Injunctive
Relief.  It is further expressly agreed that
the breach of this paragraph would result in immediate irreparable injury which
would constitute grounds for injunctive relief in a tribunal of appropriate
jurisdiction, and the parties further consent and stipulate to the entry of
appropriate provisional injunctive relief in any appropriate tribunal having jurisdiction
over the parties.

 

12.                                 Notice.  For the purpose of this Agreement,
notices and all other communications provided for in this Agreement shall be in
writing and shall be deemed to have been duly given when delivered or when
mailed by United States certified or registered mail, return receipt requested,
postage prepaid, addressed to the respective addresses set forth below, or to
such other addresses as either party may have furnished to the other in writing
in accordance herewith, exception that notice of a change of address shall be
effective only upon actual receipt:

 

6

 

	
  Company:

  	
   

  	
  Chicago Pizza &
  Brewery, Inc.

  
	
   

  	
   

  	
  16162 Beach Blvd.,
  Suite 100

  
	
   

  	
   

  	
  Huntington Beach,
  CA  92647

  
	
   

  	
   

  	
   

  
	
  Attention:

  	
   

  	
  Paul A. Motenk

  
	
   

  	
   

  	
   

  
	
  Employee:

  	
   

  	
  Michael A. Nahkunst

  
	
   

  	
   

  	
  1273  Falling Star Avenue

  
	
   

  	
   

  	
  Westlake Village,
  California  91362-5232

  

 

13.                                 Amendments
or Additions.  No
amendment or additions to this Agreement shall be binding unless in writing and
signed by both parties hereto.

 

14.                                 Section Headings.  The section headings used in this Agreement are included solely
for convenience and shall not affect, or be used in connection with, the
interpretation of this Agreement.

 

15.                                 Severability. The provisions of this
Agreement shall be deemed severable and the invalidity or unenforceability of
any provision shall not affect the validity or enforceability of the other
provisions hereof.

 

16.                                 Counterparts.  This Agreement may be executed in counterparts, each of which
shall be deemed to be an original, but both of which together will constitute
one and the same instrument.

 

17.                                 Arbitration.  Except as provided herein, any controversy or claim arising out
of or relating in any way to this Agreement or the breach thereof, or
Employee’s employment and any statutory claims including all claims of
employment discrimination shall be subject to private and confidential
arbitration in the City of Los Angeles in accordance with the laws of the State
of California.  This provision will not
apply provisional remedies as in connection with claims under paragraph 11, or
as otherwise provided herein.

 

(a)                                  The
arbitration shall be conducted in a procedurally fair manner by a mutually
agreed upon neutral arbitrator selected in accordance with the National Rules
for the Resolution of Employment Disputes (“Rules”) of the American Arbitration
Association or if none can be mutually agreed upon, then by one arbitrator
appointed pursuant to the Rules;

 

(b)                                 The
arbitration shall be conducted confidentially in accordance with the Rules;

 

(c)                                  The
arbitration fees shall be paid by the Company;

 

7

 

(d)                                 Each
party shall have the right to conduct discovery including (3) three
depositions, requests for production of documents and such other discovery as
permitted under the Rules or ordered by the arbitrator;

 

(e)                                  The
statute of limitations or any cause of action shall be that prescribed by law;

 

(f)                                    The
arbitrator shall have the authority to award any damages authorized by law for
the claims presented including punitive damages and shall have the authority to
award reasonable attorneys fees to the prevailing party;

 

(g)                                 The
decision of the arbitrator shall be final and binding on all parties and shall
be the exclusive remedy of the parties; and

 

The award shall be in
writing in accordance with the Rules, and shall be subject to judicial
enforcement in accordance with California law.

 

18.                                 Miscellaneous.  No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing and signed by the Employee and such officer as may be
specifically designated by the Board. No waiver by either party hereto at any
time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreements or representations,
oral or otherwise, express or implied, with respect to the subject matter
hereof have been made by either party which are not expressly set forth in this
Agreement. The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of California without
regard to its conflicts of law principles. All references to sections of the
Exchange Act shall be deemed also to refer to any successor provisions to such
sections.  Notwithstanding anything in
this Agreement to the contrary, upon and following Employee’s death, this
Agreement shall inure to the benefit of and be enforceable by Employee’s
personal or legal representatives, executors, heirs, distributees, devisees and
legatees, as the case may be, with respect to the payments due by the Company
as set forth in Section 9.1 of this Agreement.

 

IN WITNESS WHEREOF,
each of the parties hereto has executed this Agreement on the date first
indicated above.

 

 

	
   

  	
  CHICAGO PIZZA &
  BREWERY, INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  PAUL A. MOTENKO

  
	
   

  	
  Co-Chief Executive
  Officer

  
	
   

  
	
   

  
	
   

  	
  EMPLOYEE:

  	
   

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  MICHAEL A. NAHKUNST

  
					

 

 

8

 

EXHIBIT “A”

 

 

 

Mr. NAHKUNST IS INVOLVED WITH THE FOLLOWING ENTITIES:

 

 

 

                                Name                                                                                      Involvement

 

      1.       Southend Management, LLC, a North                              2.00 % Member

                Carolina
limited liability company (the

                sole
member of Carolina Microbrew, LLC,

                which
is the general partner of Partnerships

                That
operate Southend Brewery restaurants)

 

9Exhibit 10.26

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement (the “Agreement”) by and between Chicago Pizza and Brewery, Inc., a
California corporation (the “Company”),
and C. Douglas Mitchell (“Employee”)
is hereby entered into effective as of September 17, 2002 (“the Effective Date”).

 

 

1.             Employment and Duties.

 

(a)           The
Company hereby employs Employee as the Chief Financial Officer of the
Company.  In such capacity, Employee
shall have the responsibilities, duties and authority customarily appertaining
to such office and such other duties as may be reasonably assigned to Employee
by the President and/or the Board of Directors of the Company from time to time
and which are consistent with such position and not inconsistent with the
provisions of this Agreement.  Employee
hereby accepts this employment upon the terms and conditions herein contained
and, subject to paragraph 2(c), agrees to devote all of Employee’s attention
and efforts to the performance of Employee’s duties, and to promote and further
the business and interests of the Company.

 

(b)           Employee
shall faithfully adhere to, execute and fulfill all policies established by the
Company.

 

(c)           Employee
shall not, during the term of employment hereunder, engage in any other
business activity pursued for gain, profit or other pecuniary advantage without
giving written notice thereof to the Company’s President.  The foregoing limitation shall not be
construed as prohibiting Employee from making personal passive investments.

 

2.             Compensation.  For all services rendered by Employee, the Company shall
compensate Employee as follows:

 

(a)           Base Salary.  The base salary payable to Employee during the term shall be
$150,000.00 per year, payable in accordance with the Company’s payroll
procedures for its employees, but not less frequently than bi–weekly.  All compensation shall be payable in
accordance with the Company’s payroll procedures for its employees and subject
to federal, state and/or local withholding requirements.  Employee’s performance may be evaluated on
an annual basis, at which time Employee’s salary may be adjusted to reflect his
performance.

 

(b)           Merit Bonus.  Employee will receive a merit bonus in recognition of his
services during his first year of employment with the Company in the amount of
$25,000, subject to federal state and/or local withholding requirements.  Such amount shall be pro-rated and paid in
equal monthly installments on each of the first twelve months of employment.  In all subsequent years, Employee will be
eligible for a merit bonus solely in the discretion of the Company.  The amount of such bonus, if any, shall be
determined based on a variety of factors, which may include Employee’s job
performance, the Company’s financial performance, and such other factors as the
Company shall determine in its sole discretion.

 

1

 

 

(c)           Executive Perquisites and Benefits.  Employee shall be entitled to receive
additional benefits and compensation from the Company in such form and to such
extent as specified below:

 

(i)                                     Employee shall
be entitled to participate in all fringe benefits and perquisites offered by
the Company to its similarly situated executives, which include medical, dental
and 401K employee benefit plans provided to the employees of the Company in
general, subject to the regular eligibility requirements for each such benefit
plan or program.

 

(ii)                                  Employee shall
be entitled to paid vacation and sick leave in accordance and in parity with
the employee vacation policies of the Company for similarly situated
executives.

 

(iii)                               Employee will
receive an annual vehicle allowance of $8,000.00, paid in monthly installments
of $666.67.

 

                                (d)           Separation
Upon Change of Control.  In
the event that Employee’s employment with the Company is terminated as a result
of a Change in Control, as that term is defined in Paragraph 20 of this
Agreement, Employee will be entitled to receive severance in an amount the
equivalent of three months’ base salary for each full and complete year of
service with the Company, measured from Employee’s starting date of January 28,
2002, to a maximum of twelve months.  In
addition, all unvested stock options previously granted by the Company to
Employee will become immediately exercisable upon the date of Employee’s termination
as a result of a Change in Control.

 

                3.             At-Will Employment. 
Employee and the Company agree that Employee’s employment with the
Company is at-will, and can be terminated by either party at any time, with or
without notice.

 

4.             Return of Company Records.  All memoranda, files, client contracts,
records, electronic media, business plans, financial statements, manuals, lists
and other property delivered to or compiled by Employee by or on behalf of the
Company, its representatives, or agents which pertain to the business of the
Company shall be and remain the property of the Company, as the case may be,
and be subject at all times to the Company’s discretion and control.  Likewise, all correspondence, reports,
records, charts, marketing data, advertising materials and other similar data
pertaining to the business, activities or future plans of the Company which are
collected by Employee shall be delivered promptly to the Company upon request
by the Company upon termination of Employee’s employment and Employee shall not
retain any copies of the same.

 

 

2

 

5.             Ownership of Intellectual Property/Assignment of
Rights.  Employee
acknowledges that the Company’s obligations to Employee are exclusively contractual
in nature.  Employee shall disclose
promptly to the Company any and all conceptions, ideas, designs, plans, know–how,
processes, improvements and other discoveries, whether capable of being
patented or copywritten, or not, which during the period of employment
hereunder are (i) conceived or made by Employee, solely or jointly with
another, (ii)  directly related to the
Business or activities of the Company, and (iii) Employee conceives as a result
of his employment by the Company, including any predecessor (collectively, the
“Intellectual Property”).

 

                The
Company shall be the sole owner of all the fruits and proceeds of Employee’s
services hereunder, including, but not limited to, all ideas, concepts,
formats, suggestions, developments, arrangements, designs, packages, programs,
promotions and other Intellectual Property which Employee may create in
connection with and during the term of this Agreement, free and clear of any
claims by Employee (or any third party claims) of any kind or character whatsoever
(other than Employee’s right to compensation hereunder).  Employee shall, at the request of the
Company, execute such assignments, certificates or other instruments,
consistent herewith and after review and comment, as the Company may deem
necessary to evidence, establish, maintain, perfect, protect, enforce or defend
its right, title and interest in or to any such properties.  Employee hereby assigns and agrees to assign
all his interests therein to the Company or its nominee.  Employee shall also render to the Company,
at the Company’s expense, reasonable assistance in the perfection, enforcement
and defense of any Intellectual Property.

 

6.             Trade Secrets.  All memoranda, notes, records and other
documents made or compiled by Employee, or made available to Employee during
the term of this Agreement or subsequently during any at will employment period
concerning the business of the Company or its affiliates shall be the Company’s
property and shall be delivered to the Company on the termination of this Agreement
or at any other time on request. 
Employee understands and agrees that in the course of employment with
the Company, Employee may obtain access to and/or acquire Confidential
Information (as defined below), all of which information Employee understands
and agrees would be extremely damaging to the Company if disclosed to a
competitor or made available to any other person or corporation.

 

As used herein the term “Competitor”
includes, but is not limited to, any corporation, firm or business engaged in a
business similar to that of the Company. 
Employee understands and agrees that such information is divulged to
Employee in confidence and Employee understands and agrees that, at all times,
Employee shall keep in confidence and will not disclose or communicate
Confidential Information on Employee’s own behalf, or on behalf of any
Competitor, if such information is not otherwise publicly available, unless
disclosure is made pursuant to written approval by the Company or is required
to obtain professional advice, e.g. 
financial or legal, or is required by law or legal process or as
required to enforce the terms of this Agreement which shall only be disclosed
under Protective Order.  In view of the
nature of Employee’s employment and information which Employee may receive
during the course of Employee’s employment, Employee likewise agrees that the
Company would be irreparably harmed by any violation of this Paragraph and
that, therefore, the Company shall be entitled to

 

3

 

seek provisional injunctive relief from an appropriate forum
prohibiting Employee from any violation or threatened violation of this
Paragraph.

 

7.             Confidentiality.

 

(a)           Employee
acknowledges and agrees that all Confidential Information (as defined below) of
the Company is confidential and a valuable, special and unique asset of the
Company that gives the Company an advantage over its actual and potential,
current and future competitors. 
Employee further acknowledges and agrees that Employee owes the Company
a fiduciary duty of confidentiality and a duty of loyalty and shall use good
faith efforts to preserve and protect all Confidential Information from
unauthorized disclosure or unauthorized use; that certain Confidential
Information may constitute “trade secrets” under applicable state and federal
laws; and that unauthorized disclosure or unauthorized use of the Confidential
Information may irreparably injure the Company.

 

(b)           As
used in this Agreement, the term “Confidential Information” shall mean any
information or material known to or used by or for the Company (whether or not
owned or developed by the Company and whether or not developed by Employee)
that is known by Employee not to be generally known to persons in the
restaurant, pizzeria, or micro-brewery business.  Confidential Information includes, but is not limited to, the
following: all trade secrets of the Company; all information that the Company
has marked as confidential or has otherwise described to Employee (either in
writing or orally) as confidential; all non–public information concerning
the Company’s services, products, customers, research, prices, discounts,
costs, marketing plans, marketing techniques, market studies, test data,
vendors, referral sources, and contacts; all of the Company’s business records
and plans; all of the Company’s personnel files; details of employment
relationships between the Company and its personnel; all financial information
of or concerning the Company; all information relating to the Company’s
computer system software, application software, software and system
methodology, hardware platforms, technical information, inventions, computer
programs and listings, source codes, object codes, copyrights and other
intellectual property; all technical specifications; any proprietary
information belonging to the Company; all computer hardware or software
manuals; all training or instruction manuals; and all data, computer system
passwords and user codes.

 

For purposes hereof, Confidential Information
shall not include such information which (i) becomes or is already known to the
public through no fault of Employee; or (ii) the disclosure of which (A) is
required by law (including regulations and rulings) or the order of any
competent governmental authority or legal process, or (B) Employee reasonably
believes is required in connection with the defense of a lawsuit against
Employee, provided that in either case, prior to disclosing any information,
Employee shall provide prior written notice thereof to the Company and provide
the Company with the opportunity to contest such disclosure, or (C) if Company
provides written authorization allowing Employee such disclosure.

 

(c)           Unless
the Company is in breach of its obligations (and such breach continues unabated
for any cure period), then both during the term of Employee’s employment and
after the termination of Employee’s employment for any reason (including
wrongful

 

4

 

termination), Employee shall hold all Confidential Information in
confidence, and shall not use any Confidential Information except for the
benefit of the Company, in accordance with the duties assigned to
Employee.  Employee shall not, at any
time (either during or after the term of Employee’s employment), disclose any
Confidential Information to any person or entity (except other employees of the
Company who have a need to know the information in connection with the
performance of their employment duties, and who have been informed of the confidential
nature of the Confidential Information and have agreed to keep it
confidential), or copy, reproduce, modify, transmit, including electronic
transmission, decompile or reverse engineer any Confidential Information, or
remove any Confidential Information from the Company’s premises, without the
prior written consent of the Board, or instruct any other person to do so.  Employee shall take reasonable precautions
to protect the physical security of all documents and other material containing
Confidential Information (regardless of the medium on which the Confidential
Information is stored).  This Agreement
applies to all Confidential Information, whether now known or which later
becomes known to Employee during the term.

 

(d)           Upon
the termination of Employee’s employment with the Company for any reason, and
upon written request of the Company at any other time, Employee shall promptly
surrender and deliver to the Company all documents and other written material
of any nature containing or pertaining to any Confidential Information and
shall not retain any such document or other material.  Within ten days of any such written request, Employee shall
certify to the Company in writing that all such materials have been returned.

 

(e)           During
Employee’s term of employment, Employee agrees not to undertake planning for or
organization of any business activity competitive with the Company’s business
or combine or join with other Employees, employees or representatives of the
Company’s business for the purpose of organizing any such competitive business
activity.

 

                8.             Confidential
Agreement.  Employee also
acknowledges that (a) the terms and conditions set forth in this Agreement are
to be treated by the parties hereto as extremely confidential, and (b) that the
disclosure of any of the terms could result in substantial, irreparable
economic harm to the Company. 
Therefore, Employee agrees that in the event of any disclosure of any of
the terms of this Agreement to persons other than the Company’s officers,
accountants, and key management or Employee’s legal counsel, and/or personal
financial advisor, the Company shall be entitled to seek provisional injunctive
relief in an appropriate forum prohibiting Employee from any violation or
threatened violation of this Paragraph.

 

 

 

 

9.             Assignment; Binding Effect.  Employee understands that Company’s decision
to employ Employee was made based upon Employee’s personal qualifications,
experience and skills.  Employee agrees,
therefore, that assignment of all or any portion of Employee’s performance
under this Agreement is prohibited. 
Subject to the preceding sentences and the express provisions of
Paragraph 20 below, this Agreement shall be binding upon, inure to the

 

 

5

 

benefit of and be enforceable by the Company, its successors, heirs,
legal representatives and assigns.

 

10.           Release.  Notwithstanding anything in this Agreement to the contrary,
Employee shall not be entitled to receive any severance payments pursuant to
paragraph 2(d) of this Agreement unless Employee has executed (and not revoked)
a general release of all claims Employee may have against the Company and its
affiliates in a form of such release reasonably acceptable to the Company, the
terms of which shall be negotiated in good faith and consistent herewith.

 

11.           Notice.  For the purpose of this Agreement, notices
and all other communications provided for in this Agreement shall be in writing
and shall be deemed to have been duly given when delivered or when mailed by
United States certified or registered mail, return receipt requested, postage
prepaid, addressed to the respective addresses set forth below, or to such
other addresses as either party may have furnished to the other in writing in
accordance herewith, exception that notice of a change of address shall be
effective only upon actual receipt:

 

                Company:              Chicago Pizza & Brewery, Inc.

                                                16162
Beach Boulevard

                                                Suite
100

                                                Huntington
Beach, CA  92647

                                                Attention:
President

 

 

                Employee:              C. Douglas Mitchell

                                                16162
Beach Boulevard

                                                Suite
100

                                                Huntington
Beach, CA  92647

 

12.           Arbitration.  Except as provided herein, any controversy or claim arising out
of or relating in any way to this Agreement or the breach thereof, or
Employee’s employment and any statutory claims including all claims of
employment discrimination shall be subject to private and confidential
arbitration in the City of Los Angeles in accordance with the laws of the State
of California.  This provision will not
apply provisional remedies as in connection with claims under Paragraphs 6 or
8, or as otherwise provided herein.

 

 

 

(a)           The
arbitration shall be conducted in a procedurally fair manner by a mutually
agreed upon neutral arbitrator selected in accordance with the National Rules
for the Resolution of Employment Disputes (“Rules”) of the American Arbitration
Association or if none can be mutually agreed upon, then by one arbitrator
appointed pursuant to the Rules;

 

(b)           The
arbitration shall be conducted confidentially in accordance with the Rules;

 

 

6

 

 

(c)           The
arbitration fees shall be paid by the Company;

 

(d)           Each
party shall have the right to conduct discovery including (3) three
depositions, requests for production of documents and such other discovery as
permitted under the Rules or ordered by the arbitrator;

 

(e)           The
statute of limitations or any cause of action shall be that prescribed by law;

 

(f)            The
arbitrator shall have the authority to award any damages authorized by law for the
claims presented including punitive damages and shall have the authority to
award reasonable attorneys fees to the prevailing party;

 

 (g)          The decision of the arbitrator shall
be final and binding on all parties and shall be the exclusive remedy of the
parties; and

 

 The
award shall be in writing in accordance with the Rules, and shall be subject to
judicial enforcement in accordance with California law.

 

13.           Complete Integrated 
Agreement.   All
prior employment contracts and agreements between the parties, are merged in
this Agreement.  The Company also
maintains an employee handbook which also describes the terms and conditions of
employment.  This Agreement shall govern
to the extent any terms contained in the employee handbook are
inconsistent.  This Agreement
constitutes the entire Agreement between the Company and Employee.  Further, while Employee’s compensation,
including salary and Executive perquisites and benefits may change from time to
time without a written modification of this Agreement, neither the provisions
of this Agreement concerning at-will employment (Paragraph 3), nor any other
provision of this Agreement, may be modified, altered, amended or changed
except by in writing signed by Employee and a duly authorized agent of the
Company.

 

14.           Governing Law.   Both Employee and the Company acknowledge,
understand and agree that the Company is engaged in transactions involving
interstate commerce and that this Agreement and any arbitration hereunder shall
in all respects be construed according to federal law as well as the laws of
the State of California, without regard to its conflicts of law provisions.

 

 

15.           Amendment.  This Agreement can be modified or rescinded only in writing
expressly referring to this Agreement and signed by all of the parties to this
Agreement.

 

16.           Invalidity of Provisions.   Every provision of this Agreement is
intended to be severable.  In the event
that any term or provision hereof is declared by a court of competent
jurisdiction to be illegal or invalid for any reason whatsoever, such
illegality or invalidity shall not affect the balance of the terms and
provisions hereof, which terms and provisions shall remain binding and
enforceable, then to the extent possible all other provisions shall nonetheless
remain in full force and effect.

 

 

7

 

 

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

 

18.           Waiver.  No consent or waiver, expressed or implied, by either party to or
of any breach or default by the other in the performance by the other of its
obligations hereunder shall be deemed or construed to be a consent or waiver to
or of any other breach or default in the performance by such other party of the
same or any other obligations of such party hereunder.  Failure on the part of either party to
complain of any act or failure to act of any of the other party, or to declare
the other party in default, irrespective of how long such failure continues,
shall not constitute a waiver of such party of its rights hereunder.

 

19.           Survival of Representations.  The covenants of Employee set forth herein
shall

survive the termination of this Agreement.

 

20.           Company Right of Assignment.  In the event of the merger or consolidation
of the Company with any other corporation or corporations, the sale by the
Company of a major portion of its assets or of its business and good will, or
any other corporate reorganization involving a change in voting control of the
Company (“Change of Control”), this Agreement may be assigned and transferred
to such successor in interest as an asset of the Company upon such assignee
assuming the Company’s obligations hereunder in writing, in which event
Employee agrees to continue to perform Employee’s duties and obligations
according to the terms hereof, to or for such assignee or transferee of this
Agreement.  Employee shall not have any
right to assign, delegate or transfer any duty or obligation to be performed by
Employee hereunder to any third party, nor to assign or transfer the right, if
any, to receive payments hereunder.

 

21.           Captions.  The captions or headings at the beginning of each paragraph
hereof are for the convenience of the parties only and are not a part of this
Agreement.

 

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have
executed this Agreement effective for all purposes as of the Effective Date.

 

	
  CHICAGO PIZZA & BREWERY, INC.

  	
  EMPLOYEE:

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Jeremiah
  J. Hennessy, President

  	
  C.
  Douglas Mitchell

  

 

 

8

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00049-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00049-of-00352.parquet"}]]