Document:

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                                                                  EXHIBIT 10.1

June 27, 2000

Robert F. Cotter
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
777 Westchester Avenue
White Plains, New York  10604

Dear Bob:

I am delighted to confirm the compensation arrangements associated with your
responsibilities as Chief Operating Officer, Starwood Hotels & Resorts
Worldwide, Inc. ("the Company").

The specifics of these arrangements are outlined below:

POSITION AND EFFECTIVE DATE:

Subject to the terms of this letter, your appointment as Chief Operating Officer
is effective February 15, 2000.

You will report directly to the Company's Chief Executive Officer and you shall
perform such duties and services as are assigned to you by the Company from time
to time. You acknowledge that your employment will be subject to all policies
and practices of the Company as may currently exist or as may be curtailed,
modified or implemented from time to time. Further, you shall devote your full
time and attention to the affairs of the Company and to your duties as Chief
Operating Officer.

BASE SALARY:

For 2000 and in effect from the date of your appointment, February 15, 2000,
your base salary will be $600,000 annually, paid in semi-monthly intervals of
$25,000, and subject to applicable withholdings for FICA, local, state and
federal taxes, and Medicare. Your annual base salary will be adjusted to
$650,000 effective January 1, 2001.

ANNUAL INCENTIVE (BONUS):

You will continue to participate in the Starwood Annual Incentive Plan (AIP).
For performance year 2000, your target incentive opportunity is 100% of base
salary. Your actual incentive payout will be based upon achieving specified
performance criteria to be established and approved with the Chief Executive
Officer, and may be awarded solely at the Company's discretion. For performance
year 2001, your target incentive opportunity will be moved to 112% of base
salary. Any annual bonus shall not be deemed earned by you until the Company has
determined your entitlement to such bonus and only if you are employed by the
Company at the time such bonuses are payable in accordance with the AIP and the
Company's practices.
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BENEFITS:

You will continue to participate in the Starwood Benefits Plan as an expatriate
until such time as you and your family permanently move to the U.S. at which
point you and your family will be covered on a regular U.S. payroll basis.

LONG TERM INCENTIVE:

You will continue to participate in the Starwood 1999 Long Term Incentive
Compensation Plan ("LTIP"). This plan provides for the award of stock options at
the Company's discretion to high performing executives. For 2000, you have been
awarded a stock option grant of 316,400 Starwood options under the terms of the
1999 LTIP, effective as of the April 1, 2000 meeting of the Starwood Board of
Directors. For 2001, you will be awarded 454,000 Starwood options. This grant
date will be the date the Company's 2001 stock option grants are approved by the
Compensation & Option Committee of the Board.

CONTINUATION OF EXPATRIATE STATUS:

Since your family will not be relocating to the U.S. until the summer of 2001,
you will continue to receive your expatriate benefits and legal commitments
under Starwood's expatriate policy. In particular the following benefits will
apply until July 2001:

a.       AREA COST ALLOWANCE

         You will continue to receive an Area Cost Allowance to compensate you
         for certain costs associated with your family's living in Brussels. The
         amount of the Area Cost Allowance is based on cost of living surveys
         conducted by independent consultants and will be US$ 36,605 per annum
         for the balance of 2000. This amount will be paid in 12 equal
         installments in local currency and may fluctuate depending on foreign
         exchange and cost of living trends. Also, please note that this stated
         amount is based on current policy and might be amended based on
         Starwood's expatriate policy, which is currently being reviewed. The
         exchange rate used in converting your compensation and your Area Cost
         Allowance from US$ to BF may be subject to modification at Company
         discretion should present policies be revised.

b.       INCOME TAXES

         Your Company sourced income will continue to be tax protected in the
         U.S. A Company provided tax consultant will prepare your tax returns.
         It is the Company's responsibility to reimburse you for Belgian, and
         excess U.S., taxes incurred. It is, of course, understood that you will
         continue to be responsible for all reporting and filing of personal
         income tax returns as required by the local tax authorities.

c.       TRANSPORTATION

         You will continue to be eligible for one fully maintained Company car
         for business and personal use, as per European car policy application
         in Belgium.

d.       HOME LEAVE

         On an annual basis your family will continue to be entitled to one
         round trip full fare business class airfare between Brussels and
         Boston. If you elect to utilize the home leave benefit to a point other
         than Boston, you may do so provided the airfare costs do not exceed
         those of your normal entitlement. In addition the cost of two round
         trip economy

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         airfares (between U.S. college locations and Brussels) per year for
         your dependents attending college in the U.S. will be reimbursed. The
         Human Resources Department must approve all home leave travel in
         advance.

e.       EDUCATIONAL ASSISTANCE

         While your dependents are permanently residents in Brussels, the
         Company will continue to pay all reasonable costs associated with their
         attendance at a local international school.

f.       RELOCATION

         Starwood will pay the reasonable, out-of-pocket costs of relocating
         your family and household furnishings from Brussels to the New York
         metropolitan area in accordance with the provisions of Starwood's
         Relocation Program - Plan I. Greg Waldron is available to review the
         details of this program with you at your convenience.

         In the event that you accept the offer and relocation expenses are paid
         to you or on your behalf, you agree that if you voluntarily terminate
         your employment within one year after your relocation, you will repay
         all relocation expenses, reduced by 1/12 for each full calendar month
         actually worked. In addition, eligibility for reimbursement of any and
         all relocation expenses will cease on the last day of employment and
         any relocation expenses incurred after that date will not be reimbursed
         by Starwood and will be your responsibility.

g.       HOME LOAN

         Upon your move to the New York metropolitan area, Starwood will assist
         you in the purchase of a new principal residence by making a second
         mortgage home loan available to you in an amount of $600,000. The loan
         proceeds must be used by you to purchase your new principal residence.
         The loan will be non-transferable and non-interest bearing prior to
         maturity and will mature on the earlier of (a) five years from the date
         of the first advance of the loan to you, (b) voluntary or involuntary
         termination of your employment with Starwood, or (c) your sale of the
         residence. The loan shall be evidenced by a note in the amount of the
         loan and shall be secured by a second mortgage lien on your new
         residence. The second mortgage is to be executed by all persons having
         an ownership interest in the new residence. This loan will be funded at
         the closing of the purchase of your new residence through an escrow
         account established for this purpose acceptable to Starwood. No advance
         of the loan will be made unless documents evidencing and securing the
         loan acceptable to Starwood are signed and delivered by the appropriate
         parties.

EXCLUSIVE DISPUTE RESOLUTION PROCEDURE:

Any and all disputes relating to this offer letter, your employment with
Starwood or the termination of that employment will be resolved solely and
exclusively through binding arbitration pursuant to the employment rules of the
American Arbitration Association. Accordingly, you acknowledge and agree that
this offer of employment as Chief Operating Officer and the benefits provided
herein are contingent upon your execution of the Arbitration Agreement provided
to you herewith.

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EMPLOYMENT TERMS & SEVERANCE:

The term of this Agreement (should you accept this offer) is two years
commencing on February 15, 2000. You understand and agree that your employment
with the Company is "at will." As such, you agree that either you or Starwood
may end the employment relationship at any time, with or without cause upon 30
days' notice. By signing below you understand and acknowledge that except for
this letter, there is not any written contract between you and the Company
concerning this offer employment as Chief Operating Officer. This Agreement
supercedes any previous agreements between you and the Company relating to your
employment.

In the event that Starwood terminates your employment for any reason other than
"cause," Starwood will pay to you the greater of (i) 12 months of your then
current base salary or (ii) your current base salary through the remainder of
the term of this Agreement (the "Severance Period"), in a lump sum less all
applicable withholdings, and will reimburse you for your COBRA expenses minus
your last level of contribution for the Severance Period commencing on the
termination date (the "Termination Payments"). You will not be entitled to any
Termination Payments if you resign your employment with the Company. As a
condition for, and prior to, your entitlement to and receipt of any Termination
Payments, you must enter into a written waiver and release of any and all claims
against Starwood arising out of or relating to your employment with Starwood, in
such form that Starwood may reasonably require.

For purposes of this paragraph, "cause" shall mean (i) any material breach by
you of any of the duties, responsibilities or obligations of your employment, or
any of the policies or practices of Starwood; (ii) any willful failure or
refusal by you to properly perform (as determined by Starwood in its reasonable
discretion and judgment) the duties, responsibilities or obligations of your
employment, or to properly perform or follow (as determined by Starwood in its
reasonable discretion and judgment) any lawful order or direction by Starwood;
(iii) any acts or omissions by you that constitute (as determined by Starwood in
its reasonable discretion and judgment) fraud, dishonesty, breach of your duty
of loyalty, gross negligence, civil or criminal illegality, or any other
misconduct in your employment or which could tend to bring Starwood into
disrepute, could create material civil or criminal liability for Starwood or
could adversely and materially affect Starwood's business or interests.

OTHER CONDITIONS AND OBLIGATIONS:

As a further condition of this offer of employment as Chief Operating Officer
and your right to receive any of the benefits detailed herein, you agree to
execute and be bound by the Confidentiality, Non-solicitation Agreement provided
to you herewith.

INTEGRATED AGREEMENT:

This offer letter represents the sole and complete understanding between you and
the Company relating to your employment and there are no other written or oral
agreements, understandings or representations relating to this offer of
employment. The terms of your employment, including the at-will nature of the
employment, may be amended only through a written instrument signed by you and
the General Counsel or Chief Executive Officer of Starwood Hotels & Resorts
Worldwide, Inc. This Agreement is not intended to supercede or diminish in any
way your rights under the Severance Agreement entered into with you for the
purpose of providing certain protections in the event of a change in control of
the Company.

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By signing and returning this letter, you confirm that this letter accurately
sets forth the understanding between you and Starwood and that you accept and
agree to the terms as outlined.

Best regards,

       /s/ David K. Norton
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         David K. Norton
         Executive Vice President
         Human Resources

cc:  Barry S. Sternlicht
       Personnel File

ACCEPTED AND AGREED TO:

       /s/ Robert F. Cotter
--------------------------------------------
         Robert F. Cotter

                                       5<PAGE>   1
                                                                    Exhibit 10.1

                       AMENDMENT NO. 1 TO CREDIT AGREEMENT

    THIS AMENDMENT NO. 1 TO CREDIT AGREEMENT (this "Amendment Agreement") is
made and entered into, effective as of this 26th day of June, 2000, by and among
P.F. CHANG'S CHINA BISTRO, INC., a Delaware corporation having its principal
place of business in Phoenix, Arizona (the "Borrower"), and BANK OF AMERICA,
N.A. in its capacity as agent (the "Agent") for the financial institutions (the
"Lenders") party to the Credit Agreement (as defined below) and as a Lender, and
consented to by the Guarantors (as defined in the Credit Agreement).

                              W I T N E S S E T H:

    WHEREAS, the Borrower, the Lender and the Agent have entered into that
certain Credit Agreement dated as of December 3, 1999 (as heretofore or
hereafter amended, modified, supplemented, amended and restated or replaced, the
"Credit Agreement"), pursuant to which the Lenders have agreed to make certain
loans to the Borrower;

    WHEREAS, the Borrower has requested that the Agent and the Lender make
certain amendments to the Credit Agreement including increasing the total
revolving credit commitment amount from $15,000,000 to $45,000,000 (the
"Amendments"); and

    WHEREAS, the Agent and Lender are willing to make the Amendments;

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

    1. Definitions. Unless the context otherwise requires, all terms used herein
without definition shall have the definitions provided therefor in the Credit
Agreement.

    2. Credit Agreement Amendments. Subject to the conditions hereof, the Credit
Agreement is hereby amended, effective as of the date hereof, as follows:

        (a) Paragraph 1 of the Recitals is hereby amended by deleting the term
    "$15,000,000" and inserting, in lieu thereof, the term "$45,000,000".

        (b) The term "$15,000,000" in the definition of "Total Revolving Credit
    Commitment" in Section 1.1 is hereby deleted and the term "$45,000,000" is
    inserted in lieu thereof.

        (c) EXHIBIT A is hereby amended by deleting the term "$15,000,000"
    everywhere it appears and inserting, in lieu thereof, the amount
    "$45,000,000".

    3. Consent of Guarantors. Each of the Guarantors has joined in the execution
of this Amendment Agreement solely for the purposes of consenting hereto and for
the further purpose of confirming its guaranty of the Obligations of the
Borrower pursuant to the Facility Guaranty to which such Guarantor is party.

    4. Representations and Warranties. Each Credit Party hereby certifies that:

        (a) The representations and warranties made by each Credit Party in
ARTICLE VIII of the Credit Agreement are true on and as of the date hereof, with
the same effect as though such representations and warranties were made on the
date hereof.

        (b) There has been no material change in the condition, financial or
otherwise, of the Borrower or any of its Subsidiaries since the date of the most
recent financial reports of the Borrower received by each Lender under Section
9.1 of the Existing Credit Agreement;

        (c) The business and properties of each Credit Party and any of their
respective Subsidiaries are not, and since the date of the most recent financial
reports of the Borrower received by each Lender under Section 9.1 of the
Existing Credit Agreement have not been, adversely affected in any substantial
way as the result of any fire, explosion, earthquake, accident, strike, lockout,
combination of workmen, flood, embargo, riot, activities of armed forces, war or
acts of God or the public enemy, or cancellation or loss of any
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    major contracts; and

        (d) No event has occurred and no condition exists which, upon the
effectiveness of the amendments contemplated hereby, will constitute a Default
or an Event of Default on the part the Borrower under the Credit Agreement or
any other Loan Document either immediately or with the lapse of time or the
giving of notice, or both.

    5. Conditions Precedent. The effectiveness of this Amendment Agreement is
subject to the receipt by the Agent of four (4) counterparts of this Amendment
Agreement duly executed by all signatories hereto.

    6. Entire Agreement. This Amendment Agreement sets forth the entire
understanding and agreement of the parties hereto in relation to the subject
matter hereof and supersedes any prior negotiations and agreements among the
parties relative to such subject matter. None of the terms or conditions of this
Amendment Agreement may be changed, modified, waived or canceled orally or
otherwise, except in accordance with the terms of the Credit Agreement.

    7. Full Force and Effect of Agreement. Except as hereby specifically
amended, modified or supplemented, the Credit Agreement and all of the other
Loan Documents are hereby confirmed and ratified in all respects and shall
remain in full force and effect according to their respective terms.

    8. Counterparts. This Amendment Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.

    9. Credit Agreement and Other Loan Documents. All references in any of the
Loan Documents to the "Credit Agreement" or other defined term for the Credit
Agreement, shall mean the Credit Agreement as amended hereby.

    10. Reimbursement. The Borrower agrees to reimburse the Agent and the
Lenders for all costs and out-of-pocket expenses, including reasonable
attorneys' fees, incurred in connection with the preparation, execution, and
delivery of this Amendment Agreement.

                            [Signature pages follow.]

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