-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DoUfy21syaseL/pC4JSuXugfwl48vgSVVNnAFuLkpZvM3I6KupOOAOWTlE/juogu Dr9KPNgLIkTSauHBTDAN+A== 0000912057-00-054425.txt : 20001222 0000912057-00-054425.hdr.sgml : 20001222 ACCESSION NUMBER: 0000912057-00-054425 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20001221 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CHICAGO PIZZA & BREWERY INC CENTRAL INDEX KEY: 0001013488 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-EATING PLACES [5812] IRS NUMBER: 330485615 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-47661 FILM NUMBER: 793265 BUSINESS ADDRESS: STREET 1: 16162 BEACH BOULEVARD, SUITE 100 CITY: HUNTINGTON BEACH STATE: CA ZIP: 92647 BUSINESS PHONE: 714-848-3747 MAIL ADDRESS: STREET 1: CORPORATE OFFICES STREET 2: 16162 BEACH BOULEVARD, SUITE 100 CITY: HUNTINGTON BEACH STATE: CA ZIP: 92647 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: JACMAR COMPANIES CENTRAL INDEX KEY: 0001120728 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 952808722 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 2200 W. VALLEY ROAD CITY: ALHAMBRA STATE: CA ZIP: 91803 MAIL ADDRESS: STREET 1: 2200 W. VALLEY BLVD. CITY: ALHAMBRA STATE: CA ZIP: 91803 SC 13D/A 1 a2033883zsc13da.txt SC 13D/A SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D (RULE 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) (AMENDMENT NO. ____)(1) CHICAGO PIZZA & BREWERY, INC. - -------------------------------------------------------------------------------- (Name of Issuer) COMMON STOCK, NO PAR VALUE PER SHARE - -------------------------------------------------------------------------------- (Title of Class of Securities) 167889 10 4 - -------------------------------------------------------------------------------- (CUSIP Number) JAMES A. DAL POZZO THE JACMAR COMPANIES 2200 W. VALLEY BLVD. ALHAMBRA, CALIFORNIA 91803 (626) 576-0737 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) DECEMBER 20, 2000 - -------------------------------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box: /X/. (Continued on the following pages) Page 1 of 6 Pages (1) The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.
SCHEDULE 13D - ----------------------------------------------- -------------------------------- CUSIP No. 167889 10 4 PAGE 2 OF 6 - ----------------------------------------------- -------------------------------- - -------- ----------------------------------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY) THE JACMAR COMPANIES IRS NO.: 95-2808722 - -------- ----------------------------------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) | | (b) | | - -------- ----------------------------------------------------------------------------------------------------------- 3 SEC USE ONLY - -------- ----------------------------------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* WC - -------- ----------------------------------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) | | - -------- ----------------------------------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION CALIFORNIA - ------------------------ ------ ------------------------------------------------------------------------------------ 7 SOLE VOTING POWER 1,190,200 ------ ------------------------------------------------------------------------------------ 8 SHARED VOTING POWER NOT APPLICABLE ------ ------------------------------------------------------------------------------------ 9 SOLE DISPOSITIVE POWER 1,190,200 ------ ------------------------------------------------------------------------------------ 10 SHARED DISPOSITIVE POWER NOT APPLICABLE - -------- ----------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,190,200 SHARES - -------- ----------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* | | - -------- ----------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 15.5%(1) - -------- ----------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* CO - -------- -----------------------------------------------------------------------------------------------------------
(1) Based on 7,658,321 shares of Common Stock outstanding as of November 1, 2000, as reported by Chicago Pizza & Brewery, Inc. in its Quarterly Report on Form 10-Q filed November 9, 2000 and computed in accordance with Rule 13d-3(d)(1). *SEE INSTRUCTIONS BEFORE FILLING OUT! Page 3 of 6 ITEM 1. SECURITY AND ISSUER. This statement relates to the beneficial ownership of 1,190,200 shares of common stock, no par value per share ("Common Stock"), of Chicago Pizza & Brewery, Inc., a California corporation ("Chicago Pizza"). The principal executive offices of Chicago Pizza are located at 26131 Marguerite Parkway, Suite A, Mission Viejo, CA 92692. ITEM 2. IDENTITY AND BACKGROUND. The Jacmar Companies is a California corporation. The Jacmar Companies' address is 2200 W. Valley Blvd., Alhambra, California 91803. The principal business of The Jacmar Companies is operating a specialty wholesale foodservice distributor serving Central and Southern California, operating various restaurants, performing property management services and making investments. During the last five years, The Jacmar Companies has not been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of the proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. The aggregate purchase price for shares of Common Stock acquired by The Jacmar Companies was $2,825,174. The source of funds for the purchase of the shares of Common Stock acquired by The Jacmar Companies was from working capital. ITEM 4. PURPOSE OF TRANSACTION. The Jacmar Companies acquired the shares of Common Stock described above for investment purposes. As noted in Item 6 below, BJ Chicago, LLC, a Delaware limited liability company in which The Jacmar Companies owns a 49.9% membership interest, has entered into agreements to acquire an aggregate of 2,867,858 additional shares of Chicago Pizza Common Stock from significant shareholders of Chicago Pizza. The Jacmar Companies, directly or through BJ Chicago, LLC, intends to seek to have one or more of its designees elected to the Board of Directors of Chicago Pizza upon completion of such transactions. In addition, The Jacmar Companies intends to monitor and evaluate its direct and indirect investments in Chicago Pizza on a continuing basis. Based upon its evaluation from time to time, it may acquire additional shares of Common Stock of Chicago Pizza, dispose of shares of Common Stock it beneficially owns, submit one or more proposals for the consideration of management of Chicago Pizza, and/or communicate with other shareholders of Chicago Pizza. Except as set forth above, The Jacmar Companies has no plans or proposals that relate to or would result in any of the matters referred to in paragraphs (a) through (j), inclusive, of Item 4 of Page 4 of 6 Schedule 13D. The Jacmar Companies, however, may at any time and from time to time, review or reconsider its position with respect to any of such matters. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. The shares of Common Stock identified in Item 1 constitute approximately 15.5% of the outstanding Common Stock of Chicago Pizza, based upon the number of shares shown as outstanding as of November 1, 2000 in Chicago Pizza's Quarterly Report on Form 10-Q filed November 9, 2000. The Jacmar Companies has the sole power of voting and disposition with respect to the shares of Common Stock identified in Item 1. Except as described in this Item 5 and in Item 6 below, The Jacmar Companies has not effected transactions in Chicago Pizza's Common Stock within 60 days prior to the date of this statement. On November 30, 2000, The Jacmar Companies purchased 95,100 shares of Common Stock of Chicago Pizza at $3.00 from an affiliate in a privately negotiated transaction. On December 5, 2000, The Jacmar Companies purchased 135,000 shares of Common Stock of Chicago Pizza at $2.94 per share in open market transactions on the Nasdaq Small Cap Market and through privately negotiated block transactions. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. On December 20, 2000, BJ Chicago, LLC, a Delaware limited liability company in which The Jacmar Companies has a 49.9% membership interest, entered into an agreement to acquire an aggregate of 2,206,500 shares of Chicago Pizza Common Stock from ASSI, Inc. and Louis Habash, representing approximately 28.8% of Chicago Pizza's outstanding Common Stock, for a purchase price of $4.00 per share. In addition, BJ Chicago, LLC entered into a separate agreement dated December 20, 2000 to acquire an aggregate of 661,358 shares of the Company's common stock, representing an aggregate of 8.6% of the total outstanding shares of Chicago Pizza Common Stock, from Paul Motenko and Jerry Hennessy, the Co-Chief Executive Officers of Chicago Pizza, at a purchase price of $2.75 per share. Upon completion of the transactions, The Jacmar Companies will have sole voting and investment power with respect to 1,190,200 shares of Chicago Pizza Common Stock, representing approximately 15.5% of Chicago Pizza's outstanding shares of Common Stock, and shared voting and investment power with respect to an additional 2,867,858 shares of Chicago Pizza Common Stock, representing approximately 37.5% of Chicago Pizza's outstanding shares of Common Stock. In connection with ASSI's agreement to sell its shares of Chicago Pizza Common Stock, two directors of Chicago Pizza nominated by ASSI, Mark James and Allyn Burroughs, resigned effective December 20, 2000. Except as set forth above, to the knowledge of The Jacmar Companies, there are no contracts, arrangements, understandings or relationships (legal or otherwise) between The Jacmar Page 5 of 6 Companies and any other person with respect to any securities of Chicago Pizza, including, but not limited to, transfer or voting of any of the securities, finder's fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of profits or loss, or the giving or withholding of proxies. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. 1. Stock Purchase Agreement dated as of December 20, 2000 among BJ Chicago, LLC, ASSI, Inc. and Louis Habash. 2. Facilitation Agreement dated as of December 20, 2000 between BJ Chicago, LLC and Chicago Pizza. 3. Stock Purchase Agreement dated as of December 20, 2000 among BJ Chicago, LLC, Paul Motenko and Jerry Hennessy. Page 6 of 6 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: December 21, 2000 THE JACMAR COMPANIES By: /s/ JAMES A. DAL POZZO ---------------------- Name: James A. Dal Pozzo Its: President EX-99.1 2 a2033883zex-99_1.txt EXHIBIT 99.1 EXHIBIT 99.1 STOCK PURCHASE AGREEMENT by and between BJ CHICAGO, LLC, as the Buyer and ASSI, INC. and LOUIS HABASH, as the Sellers DECEMBER 20, 2000 STOCK PURCHASE AGREEMENT This Stock Purchase Agreement (the "AGREEMENT") is entered into as of December 20, 2000, by and among BJ Chicago, LLC, a Delaware limited liability company (the "BUYER"), and ASSI, Inc., a Nevada corporation ("ASSI"), and Louis Habash ("HABASH," and together with ASSI, the "SELLERS"), who are each shareholders of Chicago Pizza & Brewery, Inc., a California corporation ("TARGET"). The Buyer and the Sellers are referred to collectively herein as the "PARTIES." RECITALS A. Louis Habash owns 31,000 shares of the common stock of Target, and ASSI, Inc. owns an additional 2,175,500 shares of the common stock of Target, which collectively constitute all of the outstanding shares of capital stock of Target held by Sellers; and B. This Agreement contemplates a transaction in which the Buyer will purchase from the Sellers, and the Sellers will sell to the Buyer, 2,206,500 shares of Target common stock held by the Sellers in return for cash as set forth below in Section 2. AGREEMENT Now, therefore, in consideration of the premises and the mutual promises herein made, and in consideration of the representations, warranties and covenants herein contained, the Parties agree as follows. 1. DEFINITIONS. "AAA" has the meaning set forth in Section 9(o) below. "AAA RULES" has the meaning set forth in Section 9(o) below. "ACCREDITED INVESTOR" has the meaning set forth in Regulation D promulgated under the Securities Act. "ADVERSE CONSEQUENCES" means all actions, suits, proceedings, hearings, investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid in settlement, Liabilities, obligations, Taxes, liens, losses, expenses, and fees, including court costs and reasonable attorneys' fees and expenses. "AFFILIATE" has the meaning set forth in Rule 12b-2 of the regulations promulgated under the Securities Exchange Act. "BUYER" has the meaning set forth in the preface above. "CLOSING" has the meaning set forth in Section 2(c) below. "CLOSING DATE" has the meaning set forth in Section 2(c) below. "CONFIDENTIAL INFORMATION" means any information concerning the businesses and affairs of Target or confidential for purposes of the confidentiality agreement in place between the Parties as of the date hereof. "ESCROW ACCOUNT" has the meaning set forth in Section 2(b)(i) below. "ESCROW AGENT" has the meaning set forth in Section 2(b)(i) below. "INDEMNIFIED PARTY" has the meaning set forth in Section 7(c) below. "INDEMNIFYING PARTY" has the meaning set forth in Section 7(c) below. "INITIAL CLOSING" has the meaning set forth in Section 2(c) below. "INITIAL CLOSING DATE" has the meaning set forth in Section 2(c) below. "LIABILITY" means any liability (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for Taxes. "PARTIES" has the meaning set forth in the preface above with each Party being referred to, individually, as a "PARTY." "PERSON" means an individual, a partnership, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization or a governmental entity (or any department, agency or political subdivision thereof). "PURCHASE PRICE" has the meaning set forth in Section 2(b) below. "SECOND CLOSING" has the meaning set forth in Section 2(c) below. "SECOND CLOSING DATE" has the meaning set forth in Section 2(c) below. "SECURITIES ACT" means the Securities Act of 1933, as amended. "SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended. "SECURITY INTEREST" means any mortgage, pledge, lien, encumbrance, charge or other security interest. "SELLERS" has the meaning set forth in the preface above. "TARGET" has the meaning set forth in the preface above. "TARGET SHARES" mean any shares of the common stock, no par value per share, of Target, with each Target Share being referred to, individually, as a "TARGET SHARE." 2 "TAX" or "TAXES" means any federal, state, local, or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental (including taxes under Section 59A of the Internal Revenue Code), customs duties, capital stock, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use, transfer, registration, value added, alternative or add-on minimum, estimated, or other tax of any kind whatsoever, including any interest, penalty, or addition thereto, whether disputed or not. The terms "Tax" and "Taxes" include any liability for any of the foregoing items as a result of being a member of any affiliated, consolidated, combined, unitary or similar group and any liability for payment of any amounts as a result of a Tax sharing or indemnity agreement. "THIRD PARTY CLAIM" has the meaning set forth in Section 7(c) below. 2. PURCHASE AND SALE OF TARGET SHARES. (a) BASIC TRANSACTION. On and subject to the terms and conditions of this Agreement, the Buyer agrees to purchase from the Sellers, and the Sellers agree to sell to the Buyer, Two Million Two Hundred Six Thousand Five Hundred (2,206,500) Target Shares, which constitute all of the Target Shares held by Sellers, for the consideration specified below in this Section 2. (b) PURCHASE PRICE. Upon the terms and subject to the conditions contained herein, as consideration for the purchase of all of the Target Shares held by the Sellers, the Buyer will purchase such Target Shares for the consideration set forth below (the "PURCHASE PRICE"). The Purchase Price will be due and payable as follows: (i) Upon execution of this Agreement, ASSI will deliver One Million Two Hundred Fifty Thousand (1,250,000) Target Shares and Habash will deliver Thirty-One Thousand (31,000) Target Shares to an independent third party escrow agent ("ESCROW AGENT") to be held in an escrow account (the "ESCROW ACCOUNT") to be administered by Escrow Agent, which shall be released to the Buyer at the Initial Closing, or if the Initial Closing does not occur on or before January 18, 2001 (as such date may be mutually extended in writing by the parties) shall be returned by the Escrow Agent to the Sellers. (ii) Upon confirmation from the Escrow Agent of the delivery by the Sellers of the Target Shares to Escrow Agent pursuant to clause (i) of this Section, the Buyer will pay to the Sellers in cash Two Million Dollars ($2,000,000) as a nonrefundable deposit of an advance portion of the purchase price. In the event of the Initial Closing described in Section 2(c), the deposit shall be credited against the aggregate Purchase Price. If the Initial Closing does not occur on or before January 18, 2001 (as such date may be mutually extended in writing by the parties), the deposit shall be retained by Sellers as a break-up fee unless the Initial Closing does not occur as a result of a material breach hereof by Sellers. (iii) Before the Closing Date, ASSI will deliver Nine Hundred Twenty-Five Thousand Five Hundred (925,500) Target Shares to the Escrow Agent to be held in the Escrow Account to be administered by Escrow Agent, which shall be released to the Buyer at the 3 Initial Closing, or if the Initial Closing does not occur on or before January 18, 2001 (as such date may be mutually extended in writing by the parties) shall be returned by the Escrow Agent to the Sellers. (iv) If the ASSI delivers the Target Shares described in clause (iii) of this Section by the Initial Closing Date, the Buyer will pay the Sellers on the Initial Closing Date in cash an aggregate of Eight Million Eight Hundred Twenty-Six Thousand Dollars ($8,826,000) which shall be paid by (A) Sellers retaining the deposit paid by Buyer pursuant to Section 2(b)(i) of this Agreement, and (B) by Buyer paying Sellers the balance of the Purchase Price on the Initial Closing Date in an amount of Six Million Eight Hundred Twenty-Six Thousand Dollars ($6,826,000) by same day wire transfer, cashier's check or other "same day funds" acceptable to the Sellers. The Purchase Price shall be allocated among the Sellers in proportion to their respective holdings of Target Shares. (v) If ASSI has not delivered the Target Shares described in clause (iii) of this Section before the Initial Closing Date, the Buyer will pay the Sellers on the Initial Closing Date in cash an aggregate of Five Million One Hundred Twenty-Four Thousand Dollars ($5,124,000) which shall be paid by (A) Sellers retaining the deposit paid by Buyer pursuant to Section 2(b)(i) of this Agreement, and (B) by Buyer paying Sellers the balance of the Purchase Price on the Initial Closing Date in an amount of Three Million One Hundred Twenty-Four Thousand Dollars ($3,124,000) by same day wire transfer, cashier's check or other "same day funds" acceptable to the Sellers. The Purchase Price shall be allocated among the Sellers in proportion to their respective holdings of Target Shares. (vi) If ASSI has not delivered the Target Shares described in clause (iii) of this Section before the Initial Closing Date, ASSI will have thirty (30) days from the Initial Closing Date to deliver the Target Shares described in clause (iii) of this Section to the Escrow Agent. Upon confirmation from the Escrow Agent of the delivery by ASSI of the Target Shares and executed stock powers in blank to Escrow Agent pursuant to this clause, the Buyer will pay ASSI in cash in an amount of Three Million Seven Hundred Two Thousand Dollars ($3,702,000) by same day wire transfer, cashier's check or other "same day funds" acceptable to the Sellers. It shall be a material breach of this Agreement if ASSI does not deliver the Target Shares described in clause (iii) to the Escrow Agent prior to the expiration of such thirty-day period. In the event of such breach, the Buyer shall be entitled to the remedies specified in Section 9(a) of this Agreement in addition to any other remedy to which it may be entitled at law or in equity. (c) THE CLOSING. The purchase and sale of the Shares hereunder shall take place at one or more closings (each of which is referred to in this Agreement as a "CLOSING") on one or more closing dates (each a "CLOSING DATE"). The initial closing of the transactions contemplated by this Agreement (the "INITIAL CLOSING") shall take place at the offices of Latham & Watkins at 12636 High Bluff Drive, Suite 300, San Diego, California, commencing at 10:00 a.m. local time on January 18, 2001, or if any of the conditions set forth in Section 6(a) (other than conditions with respect to actions the respective Parties will take at the Initial Closing itself) has not been satisfied, a later date selected by the Buyer, which date shall be within five business days following the satisfaction or waiver of all conditions to the obligations of the Parties to consummate the transactions contemplated hereby (other than conditions with respect to actions the respective 4 Parties will take at the Initial Closing itself) (such date, the "INITIAL CLOSING DATE"). If necessary, a second closing will be held no later than thirty (30) days following the Initial Closing for the Shares described in Section 2(b)(vi) (the "SECOND CLOSING") at the offices of Latham & Watkins at 12636 High Bluff Drive, Suite 300, San Diego, California, commencing at 10:00 a.m. local time on a date agreed upon by the Sellers and the Buyer (the "SECOND CLOSING Date"). (d) DELIVERIES AT THE EXECUTION OF THIS AGREEMENT. At the execution of this Agreement, (i) the Buyer will deliver to the Sellers the nonrefundable deposit described in Section 2(b)(ii); (ii) the Sellers will deliver to the Escrow Agent the Target Shares described in Section 2(b)(i); and (iii) the counsel to the Sellers will deliver an opinion to the Buyer in form and substance as set forth in EXHIBIT A attached hereto, addressed to the Buyer, and dated as of the date of Execution of this Agreement. (e) DELIVERIES AT THE INITIAL CLOSING. At the Initial Closing, (i) Escrow Agent will release to the Buyer stock certificates representing the Target Shares then held in the Escrow Account, endorsed in blank or accompanied by duly executed assignment documents, (ii) the Buyer and the Sellers will execute and deliver to the Escrow Agent a Joint Notice in form and substance reasonably acceptable to the Escrow Agent instructing the Escrow Agent to release the Target Shares held by it to the Buyer; and (iii) the Buyer and the Escrow Agent will deliver to the Sellers the consideration specified in Section 2(b)(iv) if ASSI has delivered the shares described in Section 2(b)(iii) or the consideration specified in Section 2(b)(v) if Seller has not delivered the shares described in Section 2(b)(iii). (f) DELIVERIES AT THE SECOND CLOSING. If ASSI has not delivered the shares described in Section 2(b)(iii) by the Initial Closing Date, (i) ASSI will deliver the shares described in Section 2(b)(iii), endorsed in blank or accompanied by duly executed assignment documents, within thirty (30) days of the Initial Closing Date; (ii) upon confirmation from the Escrow Agent of the delivery by ASSI of the shares described in Section 2(b)(iii), the Buyer will deliver to Sellers the consideration specified in Section 2(b)(vi), and (iii) the Buyer and the Sellers will execute and deliver to the Escrow Agent a Joint Notice in form and substance reasonably acceptable to the Escrow Agent instructing the Escrow Agent to release the Target Shares held by it to the Buyer. 3. REPRESENTATIONS AND WARRANTIES CONCERNING THE TRANSACTION. (a) REPRESENTATIONS AND WARRANTIES OF THE SELLERS. The Sellers jointly and severally represent and warrant to the Buyer that the statements contained in this Section 3(a) are correct and complete as of the date of this Agreement and will be correct and complete as of the Initial Closing Date or, if applicable, the Second Closing Date (as though made then and as though the Initial Closing Date or, if applicable, the Second Closing Date were substituted for the date of this Agreement throughout this Section 3(a)) with respect to itself. (i) AUTHORIZATION OF TRANSACTION. ASSI, Inc. has been duly incorporated and is validly existing and in good standing under the laws of the State of Nevada. The Sellers have full power and authority to execute and deliver this Agreement and to perform their obligations hereunder. This Agreement constitutes the valid and legally binding obligation of the Sellers, enforceable in accordance with its terms and conditions. The Sellers need not give any notice to, 5 make any filing with, or obtain any authorization, consent or approval of any government or governmental agency in order to consummate the transactions contemplated by this Agreement. (ii) NONCONTRAVENTION. Except for the right of first refusal set forth at Section 8.1 of the Stock Purchase Agreement dated as of February 18, 1999 among the Sellers and Chicago Pizza, neither the execution and the delivery of this Agreement, nor the consummation of the transactions contemplated hereby, will (A) violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge or other restriction of any government, governmental agency or court to which either of the Sellers is subject or (B) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify or cancel, or require any notice under any agreement, contract, lease, license, instrument or other arrangement to which either of the Sellers is a party or by which they are bound or to which any of their assets are subject, except where the conflict, breach, default, acceleration, termination, modification, cancellation or failure to give notice would not have a material adverse effect on the ability of the parties to consummate the transactions contemplated hereby. (iii) TARGET SHARES. ASSI holds of record and owns beneficially 2,175,500 Target Shares, free and clear of any restrictions on transfer (other than any restrictions under the Securities Act and state securities laws and except for the right of first refusal set forth at Section 8.1 of the Stock Purchase Agreement dated as of February 18, 1999 among ASSI and Chicago Pizza), Taxes, Security Interests, options, warrants, purchase rights, contracts, commitments, equities, claims, encumbrances and demands. Habash holds of record and owns beneficially 31,000 Target Shares, free and clear of any restrictions on transfer (other than any restrictions under the Securities Act and state securities laws), Taxes, Security Interests, options, warrants, purchase rights, contracts, commitments, equities, claims, encumbrances and demands. The Target Shares constitute all of the issued capital stock of Target held by the Sellers and any affiliate of the Sellers. Neither of the Sellers is a party to any option, warrant, purchase right or other contract or commitment that could require either of the Sellers to sell, transfer or otherwise dispose of any capital stock of Target or any of the assets of Target (other than this Agreement). Neither of the Sellers is a party to any voting trust, proxy or other agreement or understanding with respect to the voting of any capital stock of Target. (b) REPRESENTATIONS AND WARRANTIES OF THE BUYER. The Buyer represents and warrants to the Sellers that the statements contained in this Section 3(b) are correct and complete as of the date of this Agreement and will be correct and complete as of the Initial Closing Date or, if applicable, the Second Closing Date (as though made then and as though the Initial Closing Date or, if applicable, the Second Closing Date were substituted for the date of this Agreement throughout this Section 3(b)). (i) ORGANIZATION, QUALIFICATION AND CORPORATE POWER. The Buyer is a limited liability company duly organized, validly existing and in good standing under the laws of Delaware. The Buyer has full power and authority (including full corporate power and authority) to execute and deliver this Agreement and to perform its obligations hereunder. This Agreement constitutes the valid and legally binding obligation of the Buyer, enforceable in accordance with its terms and conditions. The Buyer need not give any notice to, make any filing with, or obtain any 6 authorization, consent or approval of any government or governmental agency in order to consummate the transactions contemplated by this Agreement. (ii) INVESTMENT. The Buyer is not acquiring the Target Shares with a view to or for sale in connection with any distribution thereof within the meaning of the Securities Act. (iii) ACCREDITED INVESTOR. The Buyer is an Accredited Investor within the meaning of Rule 501(a) under the Securities Act, and the Target Shares to be acquired by it pursuant to this Agreement are being acquired for its own account, not as a nominee or agent, and not with a view to, or for resale in connection with, any distributions thereof. The Buyer has such knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risks of its investment in the Target Shares, and it is capable of bearing the economic risks of such investment. (iv) RESTRICTED SECURITIES. The Buyer understands that the Sellers are "affiliates" of the Target for the purposes of Rule 144 promulgated under the Securities Act ("Rule 144"), and the Buyer is familiar with the provisions of Rule 144. The Buyer understands that the Target Shares will be transferred to the Buyer without registration under the Securities Act under applicable state securities laws and constitute "restricted securities" for the purposes of Rule 144. The Buyer understands that the Target Shares must be held indefinitely unless subsequently registered under the Securities Act and any applicable state securities laws or unless exemptions from such registrations are available. 4. PRE-CLOSING COVENANTS. The Parties agree as follows with respect to the period between the execution of this Agreement and the Initial Closing or, if applicable, the Second Closing: (a) GENERAL. Each of the Parties will use its reasonable best efforts to take all action and to do all things necessary, proper or advisable in order to consummate and make effective the transactions contemplated by this Agreement (including satisfaction, but not waiver, of the closing conditions set forth in Section 6 below). (b) NOTICE OF DEVELOPMENTS. Each Party will give prompt written notice to the other of any material adverse development causing a breach of any of its own representations and warranties in Section 3 above. No disclosure by any Party pursuant to this Section 4(b), however, shall be deemed to cure any misrepresentation, breach of warranty or breach of covenant. (c) EXCLUSIVITY. The Sellers will not, and the Sellers will not permit or cause any of their employees, officers, shareholders or other affiliates or agents to, directly or indirectly, (i) solicit, initiate or encourage the submission of any proposal or offer from any Person relating to the acquisition of any capital stock or other voting securities, or any substantial portion of the assets of, Target (including any acquisition structured as a merger, consolidation or share exchange) or (ii) participate in any discussions or negotiations regarding, furnish any information with respect to, assist or participate in or facilitate in any other manner any effort or attempt by any Person to do or seek any of the foregoing. The Sellers will not vote their Target Shares in favor of any such 7 acquisition structured as a merger, consolidation or share exchange. The Sellers will notify the Buyer immediately if any Person makes any proposal, offer, inquiry or contact with respect to any of the foregoing. In addition, the Sellers will not reallocate, issue, transfer, sell, pledge or otherwise dispose of any equity interests in the Target prior to the Initial Closing or, if applicable, the Second Closing. Further, Sellers will not and will not cause or permit any of their employees, officers, stockholders, or other affiliates or agents to, directly or indirectly, discuss, negotiate or consider any other proposals or inquiries from any other persons or entities relating to the sale or other transfer of the Target Shares. 5. POST-CLOSING COVENANTS. The Parties agree as follows with respect to the period following the Initial Closing or, if applicable, the Second Closing: (a) GENERAL. In case at any time after the Initial Closing or, if applicable, the Second Closing any further action is necessary or desirable to carry out the purposes of this Agreement, each of the Parties will take such further action (including the execution and delivery of such further instruments and documents) as any other Party reasonably may request, all at the sole cost and expense of the requesting Party (unless the requesting Party is entitled to indemnification therefor under Section 7 below). (b) CONFIDENTIALITY. For a period of two years following the termination of this Agreement, the Parties will treat and hold as such all of the Confidential Information, refrain from using any of the Confidential Information except in connection with this Agreement, and, in respect of Sellers, deliver promptly to the Buyer or destroy, at the request and option of the Buyer, all tangible embodiments (and all copies) of the Confidential Information which are in their possession. In the event that a Party is requested or required (by oral question or request for information or documents in any legal proceeding, interrogatory, subpoena, civil investigative demand or similar process) to disclose any Confidential Information, the Party will notify the other Party promptly of the request or requirement so that the other Party may seek an appropriate protective order or waive compliance with the provisions of this Section 5(b). The foregoing provisions shall not apply to any Confidential Information which are generally available to the public immediately prior to the time of disclosure. 6. CONDITIONS TO OBLIGATION TO CLOSE. (a) CONDITIONS TO OBLIGATION OF THE BUYER. The obligation of the Buyer to consummate the transactions to be performed by it in connection with the Initial Closing or, if applicable, the Second Closing is subject to satisfaction of the following conditions: (i) the representations and warranties set forth in Section 3(a) above shall be true and correct in all material respects at and as of the Initial Closing Date or, if applicable, the Second Closing Date; (ii) the Sellers shall have performed and complied with all of their covenants hereunder in all material respects through the Initial Closing or, if applicable, the Second Closing; 8 (iii) no action, suit or proceeding shall be pending or threatened before any court or quasi-judicial or administrative agency of any federal, state, local or foreign jurisdiction or before any arbitrator wherein an unfavorable injunction, judgment, order, decree, ruling or charge would (A) prevent consummation of any of the transactions contemplated by this Agreement, (B) cause any of the transactions contemplated by this Agreement to be rescinded following consummation (and no such injunction, judgment, order, decree, ruling or charge shall be in effect), or (C) affect adversely the right of the Buyer to own the Target Shares; and (iv) From the date hereof through the Initial Closing Date or, if applicable, the Second Closing Date, there shall have been no material adverse change in the financial condition, results of operations, properties, business or prospects of Target. All actions to be taken by the Sellers in connection with consummation of the transactions contemplated hereby and all certificates, opinions, instruments and other documents required to effect the transactions contemplated hereby will be reasonably satisfactory in form and substance to the Buyer. The Buyer may waive any condition specified in this Section 6(a) if it executes a writing so stating at or prior to the Initial Closing or, if applicable, the Second Closing. (b) CONDITIONS TO OBLIGATION OF THE SELLERS. The obligation of the Sellers to consummate the transactions to be performed by them in connection with the Initial Closing or, if applicable, the Second Closing is subject to satisfaction of the following conditions: (i) the representations and warranties set forth in Section 3(b) above shall be true and correct in all material respects at and as of the Initial Closing Date or, if applicable, the Second Closing Date; (ii) the Buyer shall have performed and complied with all of its covenants hereunder in all material respects through the Initial Closing or, if applicable, the Second Closing; and (iii) no action, suit or proceeding shall be pending or threatened before any court or quasi-judicial or administrative agency of any federal, state, local or foreign jurisdiction or before any arbitrator wherein an unfavorable injunction, judgment, order, decree, ruling or charge would (A) prevent consummation of any of the transactions contemplated by this Agreement or (B) cause any of the transactions contemplated by this Agreement to be rescinded following consummation (and no such injunction, judgment, order, decree, ruling or charge shall be in effect). All actions to be taken by the Buyer in connection with consummation of the transactions contemplated hereby and all certificates, opinions, instruments and other documents required to effect the transactions contemplated hereby will be reasonably satisfactory in form and substance to the Sellers. The Sellers may waive any condition specified in this Section 6(b) by executing a writing so stating at or prior to the Initial Closing or, if applicable, the Second Closing. 7. REMEDIES FOR BREACHES OF THIS AGREEMENT. (a) INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE BUYER. 9 (i) In the event either of the Sellers breaches (or in the event any third party alleges facts that, if true, would mean either of the Sellers has breached) any of its representations, warranties and covenants contained herein, then the Sellers jointly and severally agree to indemnify the Buyer from and against the entirety of any Adverse Consequences the Buyer may suffer through and after the date of the claim for indemnification resulting from, arising out of, relating to, in the nature of, or caused by the breach (or the alleged breach). (b) INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE SELLERS. In the event the Buyer breaches (or in the event any third party alleges facts that, if true, would mean the Buyer has breached) any of its representations, warranties and covenants contained herein, then the Buyer agrees to indemnify Sellers from and against the entirety of any Adverse Consequences the Sellers may suffer through and after the date of the claim for indemnification resulting from, arising out of, relating to, in the nature of, or caused by the breach (or the alleged breach). (c) MATTERS INVOLVING THIRD PARTIES. (i) If any third party shall notify any Party (the "INDEMNIFIED PARTY") with respect to any matter (a "THIRD PARTY CLAIM") which may give rise to a claim for indemnification against any other Party (the "INDEMNIFYING PARTY") under this Section 7, then the Indemnified Party shall promptly notify the Indemnifying Party thereof in writing; PROVIDED, HOWEVER, that no delay on the part of the Indemnified Party in notifying any Indemnifying Party shall relieve the Indemnifying Party from any obligation hereunder unless (and then solely to the extent) the Indemnifying Party thereby is prejudiced. (ii) Any Indemnifying Party will have the right to defend the Indemnified Party against the Third Party Claim with counsel of its choice reasonably satisfactory to the Indemnified Party so long as (A) the Indemnifying Party notifies the Indemnified Party in writing within 15 days after the Indemnified Party has given notice of the Third Party Claim that the Indemnifying Party will indemnify the Indemnified Party from and against the entirety of any Adverse Consequences the Indemnified Party may suffer resulting from, arising out of, relating to, in the nature of, or caused by the Third Party Claim, (B) the Indemnifying Party provides the Indemnified Party with evidence reasonably acceptable to the Indemnified Party that the Indemnifying Party will have the financial resources to defend against the Third Party Claim and fulfill its indemnification obligations hereunder, and (C) the Indemnifying Party conducts the defense of the Third Party Claim actively and diligently. (iii) So long as the Indemnifying Party is conducting the defense of the Third Party Claim in accordance with Section 7(c)(ii) above, (A) the Indemnified Party may retain separate co-counsel at its sole cost and expense and participate in the defense of the Third Party Claim, (B) the Indemnified Party will not consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim without the prior written consent of the Indemnifying Party (such consent not to be withheld unreasonably) and (C) the Indemnifying Party will not consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim without the prior written consent of the Indemnified Party (such consent not to be withheld unreasonably and such consent not to be withheld at all if the judgment or settlement contains a full release reasonably satisfactory to the Indemnified Party). 10 (iv) In the event any of the conditions in Section 7(c)(ii) above is or becomes unsatisfied, however, (A) the Indemnified Party may defend against, and consent to the entry of any judgment or enter into any settlement with respect to, the Third Party Claim in any manner it reasonably may deem appropriate (and the Indemnified Party need not consult with, or obtain any consent from, any Indemnifying Party in connection therewith), (B) the Indemnifying Party will reimburse the Indemnified Party promptly and periodically for the costs of defending against the Third Party Claim (including reasonable attorneys' fees and expenses) and (C) the Indemnifying Party will remain responsible for any Adverse Consequences the Indemnified Party may suffer resulting from, arising out of, relating to, in the nature of, or caused by the Third Party Claim to the fullest extent provided in this Section 7. 8. TERMINATION. (a) TERMINATION OF AGREEMENT. The Parties may terminate this Agreement as provided below: (i) the Buyer and the Sellers may terminate this Agreement by mutual written consent at any time; (ii) the Buyer may terminate this Agreement by giving written notice to the Sellers at any time prior to the Initial Closing or, if applicable, the Second Closing (A) in the event either of the Sellers has breached any material representation, warranty or covenant contained in this Agreement in any material respect, the Buyer has notified Sellers of the breach and the breach has continued without cure for a period of 10 days after the notice of breach or (B) if such Closing shall not have occurred on or before the applicable Closing Date by reason of the failure of any condition precedent under Section 6(a) hereof (unless the failure results primarily from the Buyer itself breaching any representation, warranty or covenant contained in this Agreement); and (iii) The Sellers may terminate this Agreement by giving written notice to the Buyer at any time prior to the Initial Closing or, if applicable, the Second Closing (A) in the event the Buyer has breached any material representation, warranty or covenant contained in this Agreement in any material respect, the Sellers have notified the Buyer of the breach and the breach has continued without cure for a period of 10 days after the notice of breach or (B) if such Closing shall not have occurred on or before January 18, 2001 in respect of the Initial Closing or the applicable Closing Date in respect of the Second Closing by reason of the failure of any condition precedent under Section 6(b) hereof (unless the failure results primarily from Sellers themselves breaching any representation, warranty or covenant contained in this Agreement). 9. MISCELLANEOUS. (a) CONFIDENTIALITY OF AGREEMENT, PRESS RELEASES AND PUBLIC ANNOUNCEMENTS. Except as set forth below, the Parties shall, and shall cause their officers, employees and representatives to, treat and hold as confidential the existence and terms of this Agreement at all times prior to the Initial Closing Date, or if applicable, the Second Closing Date. Specifically, no Party shall issue any press release or make any public announcement relating to the subject matter of this Agreement prior to the Initial Closing or, if applicable, the Second Closing without the prior 11 written approval of the Buyer and the Sellers; PROVIDED, HOWEVER, that any Party may make any public disclosure it believes in good faith is required by applicable law or any listing or trading agreement concerning its publicly-traded securities to make such disclosure (in which case the disclosing Party will use its reasonable best efforts to advise the other Parties prior to making the disclosure). (b) NO THIRD-PARTY BENEFICIARIES. This Agreement shall not confer any rights or remedies upon any Person other than the Parties and their respective successors and permitted assigns. (c) ENTIRE AGREEMENT. This Agreement (including the documents referred to herein) constitutes the entire agreement among the Parties and supersedes any prior understandings, agreements or representations by or among the Parties, written or oral, to the extent they related in any way to the subject matter hereof. (d) SUCCESSION AND ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of the Parties named herein and their respective successors and permitted assigns. No Party may assign either this Agreement or any of its rights, interests or obligations hereunder without the prior written approval of the Buyer and the Sellers; PROVIDED, HOWEVER, that the Buyer may (i) assign any or all of its rights and interests hereunder to one or more of its Affiliates and (ii) designate one or more of its Affiliates to perform its obligations hereunder (in any or all of which cases the Buyer nonetheless shall remain responsible for the performance of all of its obligations hereunder). (e) COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. (f) HEADINGS. The section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement. (g) NOTICES. All notices, requests, demands, claims and other communications hereunder will be in writing. Any notice, request, demand, claim or other communication hereunder shall be deemed duly given if (and then two business days after) it is sent by registered or certified mail, return receipt requested, postage prepaid and addressed to the intended recipient as set forth below: IF TO THE SELLERS: Louis Habash 5075 Spyglass Hill Drive Las Vegas, NV 89122 Facsimile: (702) 431-8012 ASSI, Inc. 12 5075 Spyglass Hill Drive Las Vegas, NV 89122 Facsimile: (702) 431-8012 WITH A COPY TO: William L. Twomey, Esq. Hewitt & McGuire, LLP 19900 MacArthur Boulevard, Suite 1050 Irvine, CA 92612 Fax: (949) 798-0511 IF TO THE BUYER: BJ Chicago, LLC c/o The Jacmar Companies, Inc. 2200 W. Valley Boulevard Alhambra, CA 91803 Attn: James A. Dal Pozzo Telephone: (626) 576-0737 Facsimile: (626) 576-2211 WITH A COPY TO: Latham & Watkins 12636 High Bluff Drive, Suite 300 San Diego, CA 92130 Attn.: Robert E. Burwell, Esq. Telephone: (858) 523-5400 Facsimile: (858) 523-5450 Any Party may send any notice, request, demand, claim or other communication hereunder to the intended recipient at the address set forth above using any other means (including personal delivery, expedited courier, messenger service or ordinary mail), but no such notice, request, demand, claim or other communication shall be deemed to have been duly given unless and until it actually is received by the intended recipient. Any Party may change the address to which notices, requests, demands, claims and other communications hereunder are to be delivered by giving the other Parties notice in the manner herein set forth. (h) GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the domestic laws of the State of California without giving effect to any choice or conflict of law provision or rule (whether of the State of California or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of California. (i) AMENDMENTS AND WAIVERS. No amendment of any provision of this Agreement shall be valid unless the same shall be in writing and signed by the Buyer and Sellers. 13 No waiver by any Party of any default, misrepresentation or breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence. (j) SEVERABILITY. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any applicable jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other applicable jurisdiction. (k) EXPENSES. Each of the Parties will bear its own costs and expenses (including legal fees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby. Buyer and Sellers agree to evenly share the fees of the Escrow Agent and any other fees or costs associated with the Escrow Account. (l) CONSTRUCTION. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement. Any reference to any federal, state, local or foreign statute or law shall be deemed also to refer to all rules and regulations promulgated thereunder and any applicable common law, unless the context requires otherwise. The word "including" shall mean including without limitation. (m) INCORPORATION OF EXHIBITS, ANNEXES AND SCHEDULES. The Exhibits identified in this Agreement are incorporated herein by reference and made a part hereof. (n) SPECIFIC PERFORMANCE. Each of the Parties acknowledges and agrees that the other Parties would be damaged irreparably in the event any of the provisions of this Agreement are not performed in accordance with, their specific terms or otherwise are breached. Accordingly, each of the Parties agrees that the other Parties shall be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically this Agreement and the terms and provisions hereof in any action instituted in any court of the United States or any state thereof having jurisdiction over the Parties and the matter in addition to any other remedy to which they may be entitled, at law or in equity. (o) ARBITRATION. Any dispute arising out of this Agreement, or its performance or breach, shall be resolved by binding arbitration in Los Angeles, California under the Commercial Arbitration Rules (the "AAA RULES") of the American Arbitration Association (the "AAA"). This arbitration provision is expressly made pursuant to and shall be governed by the Federal Arbitration Act, 9 U.S.C. Sections 1-14. The Parties agree that pursuant to Section 9 of the Federal Arbitration Act, a judgment of a United States District Court of competent jurisdiction shall be entered upon the award made pursuant to the arbitration. A single arbitrator, who shall have the authority to allocate the costs of any arbitration initiated under this paragraph, shall be selected according to the AAA Rules within ten (10) days of the submission to the AAA of the response to the statement of claim or the date on which any such response is due, whichever is earlier. The arbitrator shall be 14 required to furnish to the parties to the arbitration a preliminary statement of the arbitrator's decision that includes the legal rationale for the arbitrator's conclusion and the calculations pertinent to any damage award being made by the arbitrator. The arbitrator shall then furnish each of the parties to the arbitration the opportunity to comment upon and/or contest the arbitrator's preliminary statement of decision either, in the discretion of the arbitrator, through briefs or at a hearing. The arbitrator shall render a final decision following any such briefing or hearing. The arbitrator shall conduct the arbitration in accordance with the Federal Rules of Evidence. The arbitrator shall decide the amount and extent of pre-hearing discovery which is appropriate. The arbitrator shall have the power to enter any award of monetary and/or injunctive relief (including the power to issue permanent injunctive relief and also the power to reconsider any prior request for immediate injunctive relief by any Party and any order as to immediate injunctive relief previously granted or denied by a court in response to a request therefor by any Party), including the power to render an award as provided in Rule 43 of the AAA Rules; PROVIDED, HOWEVER THAT THE ARBITRATOR SHALL NOT HAVE THE POWER TO AWARD CONSEQUENTIAL, INDIRECT, PUNITIVE OR EXEMPLARY DAMAGES UNDER ANY CIRCUMSTANCES REGARDLESS OF WHETHER SUCH DAMAGES MAY BE AVAILABLE UNDER APPLICABLE LAW. THE PARTIES HEREBY WAIVE THEIR RIGHTS, IF ANY, TO RECOVER ANY SUCH DAMAGES, WHETHER IN ARBITRATION OR LITIGATION. The arbitrator shall have the power to award the prevailing party its costs and reasonable attorney's fees; PROVIDED, HOWEVER, that the arbitrator shall not award attorneys' fees to a prevailing party if the prevailing party received a settlement offer unless the arbitrator's award to the prevailing party is greater than such settlement offer without taking into account attorneys' fees in the case of the settlement offer or the arbitrator's award. In addition to the above courts, the arbitration award may be enforced in any court having jurisdiction over the Parties and the subject matter of the arbitration. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 15 IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first above written. "BUYER" BJ CHICAGO, LLC, a Delaware limited liability company By: THE JACMAR COMPANIES Its: Managing Member By: /s/ JAMES A. DAL POZZO -------------------------------- Name: James A. Dal Pozzo Title: President "SELLERS" ASSI, INC., a Nevada corporation, By: /s/ LOUIS HABASH -------------------------------- Name: Louis Habash Title: /s/ LOUIS HABASH - ------------------------------------------ Louis Habash 16 EXHIBIT A FORM OF OPINION OF COUNSEL TO SELLERS The Buyer shall have received from counsel to the Sellers an opinion, addressed to the Buyer and dated as of the Initial Closing Date, in form and substance as set forth below: (a) ASSI, Inc. has been duly incorporated and is validly existing and in good standing under the laws of the State of Nevada with corporate power and authority to enter into the Stock Purchase Agreement to which they are a party and to perform their obligations thereunder. (b) The execution, delivery and performance of the Stock Purchase Agreement has been duly authorized by all necessary corporate action of the Sellers, and the Stock Purchase Agreement has been duly executed and delivered by the Sellers. (c) The Stock Purchase Agreement constitutes a legally valid and binding obligation of the Sellers, enforceable against the Sellers in accordance with its terms. (d) No registration of the Target Shares under the Securities Act of 1933, as amended, is required in connection with the offer, purchase, sale and delivery of the Target Shares in the manner contemplated by the Stock Purchase Agreement. A-1 EX-99.2 3 a2033883zex-99_2.txt EXHIBIT 99.2 EXHIBIT 99.2 FACILITATION AGREEMENT BY AND BETWEEN BJ CHICAGO, LLC, AS THE BUYER AND CHICAGO PIZZA & BREWERY, INC., AS THE TARGET, IN FURTHERANCE OF THE STOCK PURCHASE AGREEMENT BY AND BETWEEN THE BUYER AND ASSI, INC., AS THE SELLER DECEMBER 20, 2000 FACILITATION AGREEMENT This Facilitation Agreement (the "AGREEMENT") is entered into as of December 20, 2000, by and between BJ Chicago, LLC, a Delaware limited liability company (the "BUYER"), and Chicago Pizza & Brewery, Inc., a California corporation (the "TARGET"), in furtherance of the "STOCK PURCHASE AGREEMENT" by and between the Buyer and ASSI, Inc., a Nevada corporation (the "SELLER"), of even date herewith. The Buyer and Target are referred to collectively herein as the "PARTIES." RECITALS A. A Stock Purchase Agreement by and between the Buyer and Seller dated the same date hereof contemplates a transaction in which the Buyer will purchase from the Seller, and the Seller will sell to the Buyer, all of the outstanding capital stock of Target held by the Seller in return for cash as set forth in Section 2 of the Stock Purchase Agreement; and B. The Buyer will enter into this Stock Purchase Agreement simultaneously with the execution of this Agreement, and the Buyer's entering into the Stock Purchase Agreement has been made in reliance of the execution of this Agreement. AGREEMENT Now, therefore, in consideration of the premises and the mutual promises herein made, and in consideration of the representations, warranties and covenants herein contained, the Parties agree as follows. 1. DEFINITIONS. "AAA" has the meaning set forth in Section 11(p) below. "AAA RULES" has the meaning set forth in Section 11(p) below. "ACCREDITED INVESTOR" has the meaning set forth in Regulation D promulgated under the Securities Act. "ADVERSE CONSEQUENCES" means all actions, suits, proceedings, hearings, investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid in settlement, Liabilities, obligations, Taxes, liens, losses, expenses, and fees, including court costs and reasonable attorneys' fees and expenses. "AFFILIATE" has the meaning set forth in Rule 12b-2 of the regulations promulgated under the Securities Exchange Act. "BUYER" has the meaning set forth in the preface above. "CLOSING" has the meaning set forth in Section 2(a) below. "CLOSING DATE" has the meaning set forth in Section 2(a) below. "CONFIDENTIAL INFORMATION" means any information concerning the businesses and affairs of Target that is not already generally available to the public. "DISCLOSURE SCHEDULE" has the meaning set forth in Section 3 below. "INDEMNIFIED PARTY" has the meaning set forth in Section 7(d) below. "INDEMNIFYING PARTY" has the meaning set forth in Section 7(d) below. "LIABILITY" means any liability (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for Taxes. "ORDINARY COURSE OF BUSINESS" means the ordinary course of business consistent with past custom and practice (including with respect to quantity and frequency). "PARTY" has the meaning set forth in the preface above. "PERSON" means an individual, a partnership, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization or a governmental entity (or any department, agency or political subdivision thereof). "SECURITIES ACT" means the Securities Act of 1933, as amended. "SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended. "SECURITY INTEREST" means any mortgage, pledge, lien, encumbrance, charge or other security interest. "STOCK PURCHASE AGREEMENT" has the meaning set forth in the preface above. "TARGET" has the meaning set forth in the preface above. "TARGET SHARE" means any share of the common stock, no par value per share, of Target. "TAX" or "TAXES" means any federal, state, local, or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental (including taxes under Section 59A of the Internal Revenue Code), customs duties, capital stock, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use, transfer, registration, value added, alternative or add-on minimum, estimated, or other tax of any kind whatsoever, including any interest, penalty, or addition thereto, whether disputed or not. The terms "Tax" and "Taxes" include any liability for any of the foregoing items as a result of being a member of any affiliated, consolidated, combined, unitary or similar group and any liability for payment of any amounts as a result of a Tax sharing or indemnity agreement. "THIRD PARTY CLAIM" has the meaning set forth in Section 7(d) below. 2 2. PURCHASE AND SALE OF TARGET SHARES. (a) THE CLOSING. The closing of the transactions contemplated by this Agreement and the Stock Purchase Agreement (the "CLOSING") shall take place at the offices of Latham & Watkins at 12636 High Bluff Drive, Suite 300, San Diego, California, commencing at 10:00 a.m. local time on January 18, 2001, or, if any of the conditions set forth in Section 6(a) (other than conditions with respect to actions the respective Parties will take at the Closing itself) has not been satisfied, a later date selected by the Buyer, which date shall be within five business days following the satisfaction or waiver of all conditions to the obligations of the Parties to consummate the transactions contemplated hereby (other than conditions with respect to actions the respective Parties will take at the Closing itself). (b) DELIVERIES AT THE CLOSING. At the Closing, the Target will deliver to the Buyer the various certificates, instruments and documents referred to in Section 6(a) below. 3. REPRESENTATIONS AND WARRANTIES CONCERNING THE TARGET. The Target represents and warrants to the Buyer that the statements contained in this Section 3 are correct and complete as of the date of this Agreement and will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this Section 3), except as set forth in the disclosure schedule delivered by the Target to the Buyer on the date hereof (the "DISCLOSURE SCHEDULE"). The Disclosure Schedule will be arranged in paragraphs corresponding to the lettered and numbered paragraphs contained in this Section 3. (a) ORGANIZATION, QUALIFICATION AND CORPORATE POWER. Target is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation. The Target is duly authorized to conduct business and is in good standing under the laws of each jurisdiction where such qualification is required, except where the failure to be so qualified would not have a material adverse effect on the business, financial condition, operations, results of operations or future prospects of the Target. The Target is not in default under or in violation of any provision of its charter or bylaws. The Target has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder. This Agreement constitutes the valid and legally binding obligation of the Target, enforceable in accordance with its terms and conditions. Target need not give any notice to, make any filing with, or obtain any authorization, consent or approval of any government or governmental agency in order to consummate the transactions contemplated by this Agreement. (b) CAPITALIZATION. The entire authorized capital stock of the Target consists of 60,000,000 Target Shares, of which 7,658,321 Target Shares are issued and outstanding. Except as set forth at Section 3(b) of the Disclosure Schedule, there are no outstanding or authorized warrants, options, purchase rights, subscription rights, conversion rights, exchange rights or other contracts or commitments that could require the Target to issue, sell or otherwise cause to become outstanding any of its capital stock. There are no outstanding or authorized stock appreciation, phantom stock, profit participation or similar rights with respect to the Target. There are no voting trusts, proxies or other agreements or understandings with respect to the voting of the capital stock of the Target. 3 (c) NONCONTRAVENTION. Neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated by the Stock Purchase Agreement, will (i) violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge or other restriction of any government, governmental agency or court to which the Target is subject or any provision of the charter or bylaws of the Target or (ii) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify or cancel, or require any notice under any agreement, contract, lease, license, instrument, or other arrangement to which the Target is a party or by which the Target is bound or to which any of the Target's assets is subject (or result in the imposition of any Security Interest upon any of such assets). Except for filings which may be required under local or state laws with respect to liquor licensing and gaming licensing, and which the Company is currently preparing, the Target does not need to give any notice to, make any filing with, or obtain any authorization, consent or approval of any government or governmental agency in order for the Parties to consummate the transactions contemplated by this Agreement. (d) REPORTS FILED UNDER THE SECURITIES EXCHANGE ACT OF 1934. Target has timely filed all reports required to be filed by Target under the Securities Exchange Act. All such reports filed by Target in the preceding twelve (12) months contain all statements required to be stated therein in accordance with the Exchange Act and do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. (e) FULL DISCLOSURE. The representations and warranties contained in this Section 3 do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements and information contained in this Section 3 not misleading. 4. PRE-CLOSING COVENANTS. The Parties agree as follows with respect to the period between the execution of this Agreement and the Closing. (a) GENERAL. The Target and the Buyer will use their reasonable best efforts to take all action and to do all things necessary, proper or advisable in order to consummate and make effective the transactions contemplated by this Agreement and the Stock Purchase Agreement. (b) NOTICES AND CONSENTS. The Target will give any notices to third parties and will use its reasonable best efforts to obtain any third party consents that the Buyer reasonably requests. The Target will give any notices to, make any filings with, and use its reasonable best efforts to obtain any authorizations, consents and approvals of governments and governmental agencies in connection with the matters referred to in Section 3(c) above. (c) OPERATION OF BUSINESS. The Target will not engage in any practice, take any action or enter into any transaction outside the Ordinary Course of Business. Without limiting the generality of the foregoing, the Target will not declare, set aside or pay any dividend or make any distribution with respect to its capital stock or redeem, purchase or otherwise acquire any of its capital stock. 4 (d) PRESERVATION OF BUSINESS. The Target will keep its business and properties substantially intact, including its present operations, physical facilities, working conditions and relationships with lessors, licensors, suppliers, customers and employees. (e) FULL ACCESS. The Target will permit representatives of the Buyer to have full access at all reasonable times, and in a manner so as not to interfere with the normal business operations of the Target, to all premises, properties, personnel, books, records (including Tax records), contracts and documents of or pertaining to the Target. (f) NOTICE OF DEVELOPMENTS. The Target will give prompt written notice to the Buyer of any material adverse development affecting its financial condition, results of operations, properties, business or prospects. (g) EXCLUSIVITY. The Target will not cause or permit an employee, officer, stockholder, or other affiliate or agent to (i) solicit, initiate or encourage the submission of any proposal or offer from any Person relating to the acquisition of any capital stock or other voting securities, or any substantial portion of the assets of, the Target (including any acquisition structured as a merger, consolidation or share exchange) or (ii) participate in any discussions or negotiations regarding, furnish any information with respect to, assist or participate in or facilitate in any other manner any effort or attempt by any Person to do or seek any of the foregoing. The Target will notify the Buyer immediately if any Person makes any proposal, offer, inquiry or contact with respect to any of the foregoing. (h) WAIVER OF RIGHT OF FIRST REFUSAL. Target shall, and hereby does, waive any right of first refusal, right of first offer, right of first negotiation or any other restriction running in its favor that may be applicable to the Target Shares to be sold pursuant to the Stock Purchase Agreement insofar as the purchase and sale of such Target Shares is completed in accordance with the terms of the Stock Purchase Agreement. 5. POST-CLOSING COVENANTS. The Parties agree as follows with respect to the period following the Closing: (a) GENERAL. In case at any time after the Closing any further action is necessary or desirable to carry out the purposes of this Agreement, each of the Parties will take such further action (including the execution and delivery of such further instruments and documents) as any other Party reasonably may request, all at the sole cost and expense of the requesting Party (unless the requesting Party is entitled to indemnification therefor under Section 7 below). (b) CONFIDENTIALITY. The Buyer will treat and hold as such all of the Confidential Information, refrain from using any of the Confidential Information except in connection with this Agreement and deliver promptly to Target or destroy, at the request and option of the Target, all tangible embodiments (and all copies) of the Confidential Information which are in its possession. In the event that the Buyer is requested or required (by oral question or request for information or documents in any legal proceeding, interrogatory, subpoena, civil investigative demand or similar process) to disclose any Confidential Information, the Buyer will notify the Target promptly of the request or requirement so that the Target may seek an appropriate protective order or waive 5 compliance with the provisions of this Section 5(b). The foregoing provisions shall not apply to any Confidential Information which is generally available to the public immediately prior to the time of disclosure. (c) REGISTRATION STATEMENT FOR RESALE OF THE TARGET SHARES. (i) SHELF REGISTRATION STATEMENT. As promptly as practicable but in no event later than five days following the filing of its Annual Report on Form 10-K with respect to the year ending December 31, 2000, the Target will prepare and file with the Securities and Exchange Commission (the "SEC") a shelf registration statement under the Securities Act of 1933 (as amended and together with the rules and regulations promulgated thereunder, the "SECURITIES ACT") registering all of the Target Shares held by the Buyer upon the completion of the transactions contemplated by the Stock Purchase Agreement for resale to the public by the Buyer, pursuant to such registration statement and the prospectus included therein (the "REGISTRATION STATEMENT"), free and clear of any restrictions under the Securities Act except for prospectus delivery requirements. The Target shall use all reasonable efforts to cause such Registration Statement to become effective as promptly as practicable thereafter and, subject to Section 5(c)(ii) below, to remain effective until such time as the Buyer may freely sell the Target Shares held by it without registration and without regard to volume or manner of sale. The Buyer shall furnish such information regarding the distribution of the Target Shares and such other information relating to the Buyer and its ownership of securities of the Target as the Target may from time to time reasonably request. The Buyer agrees to promptly furnish additional information required to be disclosed in order to make the information previously furnished to the Target by the Buyer not materially misleading. The Buyer agrees to furnish all such information and to cooperate with and provide assistance to the Target, as the Target may reasonably request, in connection with any registration and sale of the Target Shares. (ii) TARGET OBLIGATIONS. From time to time during the period commencing upon the effectiveness of the Registration Statement and ending upon the earlier of (x) such time as the Buyer may freely sell the Target Shares held by it without registration and without regard to volume or manner of sale, or (y) such time as the Buyer shall have advised the Target in writing that it has completed its resale of the Target Shares held by it (the "RESALE PERIOD"), the Target shall do the following: (A) Prepare and deliver to the Buyer as many copies of the Prospectus (as hereafter defined) as the Buyer may reasonably request; (B) Use its reasonable efforts to comply with all requirements imposed upon it by the Securities Act, by the Securities Exchange Act, and by the undertakings in the Registration Statement so far as is necessary to permit the continuance of resales of Target Shares by the Buyer to the public, free and clear of any restrictions under the Securities Act except for prospectus delivery requirements. If, at any time during the Resale Period, an event shall occur which makes it necessary to amend or supplement the Registration Statement or the Prospectus to comply with law or with the rules and regulations of the SEC, the Target shall promptly notify the Buyer of the proposed amendment or supplement and promptly prepare and furnish to the Buyer such number of copies of an amended or supplemented Registration Statement or Prospectus that 6 complies with law and with such rules and regulations as the Buyer may reasonably request. The Buyer shall suspend its sales of Target Shares pending the preparation and delivery of such amendment or supplement and until such time as each such amendment or amendments to the Registration Statement have been declared effective by the SEC. The Target authorizes the Buyer, and any brokers or dealers effecting sales of the Target Shares for the account of the Buyer, to use the Prospectus, as from time to time amended or supplemented, in connection with the sale of the Target Shares in accordance with applicable provisions of the Securities Act and state securities laws. For purposes of this Agreement, the term "PROSPECTUS" means the final prospectus relating to the Target Shares most recently included in the Registration Statement or filed by the Target pursuant to Rule 424 of the Securities Act and any amendments or supplements thereto filed by the Target pursuant to Rule 424 of the Securities Act and shall include all documents or information incorporated in any such prospectus by reference; (C) Promptly advise the Buyer (1) when any post-effective amendment of the Registration Statement is filed with the SEC and when any post-effective amendment becomes effective; (2) of any request made by the SEC for any amendment of or supplement to the Registration Statement or the Prospectus or for additional information relating thereto; (3) of any suspension or threatened suspension of the use of any Prospectus in any state; and (4) of any proceedings commenced or threatened to be commenced by the SEC or any state securities commission which would result in the issuance of any stop order or other order or suspension of use. The Target agrees to use its reasonable efforts to prevent or promptly remove any stop order or other order preventing or suspending the use of the Prospectus during the Resale Period and to comply with any such request by the SEC to amend or supplement the Prospectus; (D) Take such action as shall be necessary to qualify and maintain the qualification of the Target Shares covered by such registration under such state securities or "blue sky" laws for offers and sales to the public during the Resale Period as the Buyer shall reasonably request; PROVIDED, HOWEVER, that the Target shall not be obligated to qualify as a foreign corporation to do business under the laws of or become subject to taxation in, any jurisdiction in which it shall not be then qualified, or to file any general consent to service of process; and (E) Cause the Target Shares to be registered pursuant to Section 12(b) or 12(g) of the Exchange Act and continually quoted or listed, subject to notice of issuance, on The Nasdaq National Market or a national securities exchange, if such exchange is the principal market on which the Target Shares are traded, and not subject to any restriction or suspension from trading on the Nasdaq National Market or such national securities exchange; PROVIDED, HOWEVER, that the Target may deregister the Target Common Stock registered pursuant to Section 12(b) or 12(g) of the Exchange Act if such deregistration is in connection with a merger, dissolution or other transaction in which the stockholders of the Target receive prior to such deregistration either cash or securities that are listed on The Nasdaq National Market or a national securities exchange or some combination of cash and such securities; PROVIDED, FURTHER, that the Target may delist the Target Shares from trading on The Nasdaq National Market or national securities exchange if the Target is concurrently listing such stock on the New York Stock Exchange or the American Stock Exchange. 7 (iii) INDEMNIFICATION OF THE BUYER. The Target shall indemnify, defend and hold harmless the Buyer against and in respect of any losses, claims, damages or liabilities, joint or several (including legal or other fees and expenses reasonably incurred by it in connection with investigating or defending any such loss, claim, damage or liability) to which the Buyer may become subject under the Securities Act or otherwise insofar as such losses, claims, damages or liabilities (or actions with respect thereto) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Registration Statement, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except to the extent that any such untrue statement or omission is based upon written information supplied by the Buyer or by any of its representatives for use in such Registration Statement; PROVIDED, HOWEVER, this indemnity agreement shall not inure to the benefit of the Buyer on account of any loss, claim, damage, liability or action arising from the sale of the Target Shares to any person if the Buyer fails to send or give a copy of the Prospectus (as amended or supplemented) to such person. (iv) INDEMNIFICATION OF THE TARGET. The Buyer shall indemnify, defend and hold harmless the Target, its officers and its directors and any controlling persons of the Target against and in respect of any losses, claims, damages or liabilities, joint or several (including legal or other fees and expenses reasonably incurred by any of them in connection with investigating or defending any such loss, claim, damage or liability) to which the Target or any such persons may become subject under the Securities Act or otherwise insofar as such losses, claims, damages or liabilities (or actions with respect thereto) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Registration Statement, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, but only in each case to the extent that any such untrue statement or omission is based upon written information supplied by the Buyer or its representatives for use in such Registration Statement. (v) CONTRIBUTION. If for any reason the indemnification provided for in the preceding Sections 5(c)(iii) or 5(c)(iv) is unavailable to an indemnified party as contemplated by such clauses, then the indemnifying party shall contribute to the amount paid or payable by the indemnified party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect not only the relative benefits received by the indemnified party and the indemnifying party, but also the relative fault of the indemnified party and the indemnifying party, as well as any other relevant equitable considerations. (vi) PROCEDURE FOR INDEMNIFICATION. The procedure for indemnification under this Section 5(c) shall be as follows: (A) NOTICE. The indemnified party shall promptly give notice to the indemnifying party of any pending or threatened claim giving rise to indemnification under Sections 5(c)(iii) or (iv) (a "CLAIM"), specifying the factual basis for the Claim and the approximate amount thereof. (B) CONTROL OF CLAIM AND SETTLEMENT. With respect to any Claim as to which a person is entitled to indemnification hereunder, the indemnifying party shall have the 8 right at its own expense to participate in or assume control of the defense of the Claim, and the indemnified party shall cooperate fully with the indemnifying party, subject to reimbursement for actual out-of-pocket expenses incurred by the indemnified party as the result of a request by the indemnifying party. If the indemnifying party elects to assume control of the defense of any Claim, the indemnified party shall have the right to participate in the defense of the Claim at its own expense. If the indemnifying party does not elect to assume control or otherwise participate in the defense of any Claim, it shall be bound by the results obtained by the indemnified party with respect to the Claim. No indemnifying party shall be liable for any settlement effected without its written consent, not to be unreasonably withheld or delayed. (vii) SURVIVAL. Notwithstanding any other provision of this Agreement, the indemnification and contribution obligations of the parties hereunder shall survive indefinitely. (viii) EXPENSES. The Target shall pay all expenses incident to the registration of the Target Shares under this Section 5(c), including without limitation, all registration, filing and NASD fees, all fees and expenses of complying with securities or blue sky laws, all word processing, duplicating and printing expenses, and the fees and disbursements of counsel for the Target and its independent public accountants. With respect to sales of Target Shares, the Buyer shall pay all underwriting discounts and commissions and fees of underwriters, selling brokers, dealer managers or similar securities industry professionals relating to the distribution of the Target Shares to be sold by the Buyer, the fees and disbursements of counsel retained by the Buyer and transfer taxes, if any. (ix) COMPLIANCE. The Buyer will observe and comply with the Securities Act, the Exchange Act and the general rules and regulations thereunder, as now in effect and as from time to time amended and including those hereafter enacted or promulgated, in connection with any offer, sale, pledge, transfer or other disposition of the Target Shares or any part thereof. (d) FINANCING. In consideration of Target's entering into this Agreement, Buyer hereby agrees, subject to the completion of the transactions contemplated by the Stock Purchase Agreement, that it will obtain for Target, on or before February 14, 2001, up to $4.8 million of new financing from a commercial lender on commercially reasonable terms to replace Target's existing funded debt. In addition, subject to project pre-commitment approval by Buyer which will not be unreasonably withheld, Buyer will arrange up to an additional $1.2 million of financing for future development projects of Target. Such financing will be at commercially reasonable rates and may be secured by assets of Target or its subsidiaries. 6. DELIVERIES. (a) DELIVERIES BY TARGET ON OR BEFORE DECEMBER 20, 2000. On or prior to December 20, 2000, Target shall use its best efforts to deliver to Buyer the following: (i) evidence of Target's receipt of any third party consents reasonably requested by Buyer; 9 (ii) a certificate of the co-chief executive officers of Target dated as December 20, 2000 to the effect that (A) the representations and warranties set forth in Section 3 above are true and correct in all material respects at and as of such date; (B) the Target has performed and complied with all of its covenants hereunder to be performed on or prior to such date in all material respects; and (C) no action, suit or proceeding is pending or threatened before any court or quasi-judicial or administrative agency of any federal, state, local or foreign jurisdiction or before any arbitrator wherein an unfavorable injunction, judgment, order, decree, ruling or charge would (1) prevent consummation of any of the transactions contemplated by this Agreement or the Stock Purchase Agreement, (2) cause any of the transactions contemplated by this Agreement or the Stock Purchase Agreement to be rescinded following consummation, (3) affect adversely the right of the Buyer to own the Target Shares or (4) adversely affect the right of the Target to own its assets and to operate its businesses (and no such injunction, judgment, order, decree, ruling or charge shall be in effect); (iii) an opinion in form and substance as set forth in EXHIBIT A attached hereto, addressed to the Buyer, and dated as of the Closing Date; (iv) an opinion from Target's accountants in form and substance reasonably acceptable to the Buyer to the effect that the transactions contemplated by this Agreement and the Stock Purchase Agreement will not be taxable to Target and will not trigger any loss of Target's tax assets; (v) evidence of Target having terminated any rights of first refusal running in favor of Target relating to any of the Target Shares held by Seller; and (vi) letters of resignation from the Board of Directors of Target, effective as of the Closing Date, from Mark James and Allyn Burroughs. (b) DELIVERIES BY TARGET ON THE CLOSING DATE. On the Closing Date, Target shall deliver to the Buyer a certificate of the chief executive officer and the chief financial officer of Target dated as of the Closing Date to the effect that (A) the representations and warranties set forth in Section 3 above are true and correct in all material respects at and as of the Closing Date; (B) the Target has performed and complied with all of its covenants hereunder to be performed on or prior to the Closing Date in all material respects; and (C) no action, suit or proceeding is pending or threatened before any court or quasi-judicial or administrative agency of any federal, state, local or foreign jurisdiction or before any arbitrator wherein an unfavorable injunction, judgment, order, decree, ruling or charge would (1) prevent consummation of any of the transactions contemplated by this Agreement or the Stock Purchase Agreement, (2) cause any of the transactions contemplated by this Agreement or the Stock Purchase Agreement to be rescinded following consummation, (3) affect adversely the right of the Buyer to own the Target Shares or (4) adversely affect the right of the Target to own its assets and to operate its businesses (and no such injunction, judgment, order, decree, ruling or charge shall be in effect). 7. REMEDIES FOR BREACHES OF THIS AGREEMENT. 10 (a) SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Unless otherwise set forth below, the representations and warranties of the Target contained in Section 3 shall survive the Closing hereunder (even if the Buyer knew or had reason to know of any misrepresentation or breach of warranty at the time of Closing) and continue in full force and effect for a period of two years following the Closing thereafter (subject to any applicable statutes of limitations). (b) INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE BUYER. In the event the Target breaches (or in the event any third party alleges facts that, if true, would mean Target has breached) any of its representations, warranties and covenants contained herein, and, if there is an applicable survival period pursuant to Section 7(a) above, provided that the Buyer makes a written claim for indemnification against Target pursuant to Section 10(h) below within such survival period, then Target agrees to indemnify the Buyer from and against the entirety of any Adverse Consequences the Buyer may suffer through and after the date of the claim for indemnification (including any Adverse Consequences the Buyer may suffer after the end of any applicable survival period) resulting from, arising out of, relating to, in the nature of, or caused by the breach (or the alleged breach). (c) INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE TARGET. In the event the Buyer breaches (or in the event any third party alleges facts that, if true, would mean the Buyer has breached) any of its covenants contained herein, then the Buyer agrees to indemnify Target from and against the entirety of any Adverse Consequences the Target may suffer through and after the date of the claim for indemnification (including any Adverse Consequences the Target may suffer after the end of any applicable survival period) resulting from, arising out of, relating to, in the nature of, or caused by the breach (or the alleged breach). (d) MATTERS INVOLVING THIRD PARTIES. (i) If any third party shall notify any Party (the "INDEMNIFIED PARTY") with respect to any matter (a "THIRD PARTY CLAIM") which may give rise to a claim for indemnification against any other Party (the "INDEMNIFYING PARTY") under this Section 7, then the Indemnified Party shall promptly notify each Indemnifying Party thereof in writing; PROVIDED, HOWEVER, that no delay on the part of the Indemnified Party in notifying any Indemnifying Party shall relieve the Indemnifying Party from any obligation hereunder unless (and then solely to the extent) the Indemnifying Party thereby is prejudiced. (ii) Any Indemnifying Party will have the right to defend the Indemnified Party against the Third Party Claim with counsel of its choice reasonably satisfactory to the Indemnified Party so long as (A) the Indemnifying Party notifies the Indemnified Party in writing within 15 days after the Indemnified Party has given notice of the Third Party Claim that the Indemnifying Party will indemnify the Indemnified Party from and against the entirety of any Adverse Consequences the Indemnified Party may suffer resulting from, arising out of, relating to, in the nature of, or caused by the Third Party Claim, (B) the Indemnifying Party provides the Indemnified Party with evidence reasonably acceptable to the Indemnified Party that the Indemnifying Party will have the financial resources to defend against the Third Party Claim and fulfill its indemnification obligations hereunder, and (C) the Indemnifying Party conducts the defense of the Third Party Claim actively and diligently. 11 (iii) So long as the Indemnifying Party is conducting the defense of the Third Party Claim in accordance with Section 7(d)(ii) above, (A) the Indemnified Party may retain separate co-counsel at its sole cost and expense and participate in the defense of the Third Party Claim, (B) the Indemnified Party will not consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim without the prior written consent of the Indemnifying Party (such consent not to be withheld unreasonably) and (C) the Indemnifying Party will not consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim without the prior written consent of the Indemnified Party (such consent not to be withheld unreasonably and such consent not to be withheld at all if the judgment or settlement contains a full release reasonably satisfactory to the Indemnified Party). (iv) In the event any of the conditions in Section 7(d)(ii) above is or becomes unsatisfied, however, (A) the Indemnified Party may defend against, and consent to the entry of any judgment or enter into any settlement with respect to, the Third Party Claim in any manner it reasonably may deem appropriate (and the Indemnified Party need not consult with, or obtain any consent from, any Indemnifying Party in connection therewith), (B) the Indemnifying Party will reimburse the Indemnified Party promptly and periodically for the costs of defending against the Third Party Claim (including reasonable attorneys' fees and expenses) and (C) the Indemnifying Party will remain responsible for any Adverse Consequences the Indemnified Party may suffer resulting from, arising out of, relating to, in the nature of, or caused by the Third Party Claim to the fullest extent provided in this Section 7. 8. TERMINATION. (a) TERMINATION OF AGREEMENT. The Buyer and the Target may terminate this Agreement as provided below: (i) the Buyer and the Target may terminate this Agreement by mutual written consent at any time prior to the Closing; or (ii) either the Buyer or the Target may terminate this Agreement by giving written notice to the other at any time prior to the Closing if the Closing shall not have occurred on or before January 18, 2001. (b) EFFECT OF TERMINATION. If the either of the Parties terminates this Agreement pursuant to Section 8(a) above, all rights and obligations of the Parties hereunder shall terminate without any Liability of any Party to any other Party (except for any Liability of any Party then in breach). In addition, in the event of termination of this Agreement pursuant to Section 8(a) above, (i) each Party will redeliver all documents, work papers and other material of any other party relating to the transactions contemplated hereby, whether obtained before or after the execution hereof, to the Party furnishing the same and (ii) the provisions of Section 5(b) will continue in full force and effect. 9. MISCELLANEOUS. 12 (a) CONFIDENTIALITY OF AGREEMENT, PRESS RELEASES AND PUBLIC ANNOUNCEMENTS. Except as set forth below, the Parties shall, and shall cause their officers, employees and representatives to, treat and hold as confidential the existence and terms of this Agreement at all times prior to the Closing Date. Specifically, no Party shall issue any press release or make any public announcement relating to the subject matter of this Agreement prior to the Closing without the prior written approval of the Buyer and the Target; PROVIDED, HOWEVER, that any Party may make any public disclosure it believes in good faith is required by applicable law or any listing or trading agreement concerning its publicly-traded securities to make such disclosure (in which case the disclosing Party will use its reasonable best efforts to advise the other Parties prior to making the disclosure). (b) NO THIRD-PARTY BENEFICIARIES. This Agreement shall not confer any rights or remedies upon any Person other than the Parties and their respective successors and permitted assigns. (c) ENTIRE AGREEMENT. This Agreement (including the documents referred to herein) constitutes the entire agreement among the Parties and supersedes any prior understandings, agreements or representations by or among the Parties, written or oral, to the extent they related in any way to the subject matter hereof. (d) SUCCESSION AND ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of the Parties named herein and their respective successors and permitted assigns. No Party may assign either this Agreement or any of his or its rights, interests or obligations hereunder without the prior written approval of the Buyer and the Target; PROVIDED, HOWEVER, that the Buyer may (i) assign any or all of its rights and interests hereunder to one or more of its Affiliates and (ii) designate one or more of its Affiliates to perform its obligations hereunder (in any or all of which cases the Buyer nonetheless shall remain responsible for the performance of all of its obligations hereunder). (e) COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. (f) HEADINGS. The section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement. (g) NOTICES. All notices, requests, demands, claims and other communications hereunder will be in writing. Any notice, request, demand, claim or other communication hereunder shall be deemed duly given if (and then two business days after) it is sent by registered or certified mail, return receipt requested, postage prepaid and addressed to the intended recipient as set forth below: IF TO THE TARGET: 13 Chicago Pizza & Brewery, Inc. 16162 Beach Boulevard, Suite 100 Huntington Beach, CA 92647 Attention: President Telephone: (714) 848-3747 Facsimile: (714) 848-5587 WITH A COPY TO: Steven J. Insel, Esq. Jeffer, Mangels, Butler & Marmaro, LLP 2121 Avenue of the Stars, Tenth Floor Los Angeles, California, CA 90067 Telephone: (310) 203-8080 Facsimile: (310) 203-0567 14 IF TO THE BUYER: BJ Chicago, LLC c/o The Jacmar Companies, Inc. 2200 W. Valley Boulevard Alhambra, CA 91803 Attn: James A. Del Pozzo Telephone: (626) 576-0737 Facsimile: (626) 576-2211 WITH A COPY TO: Latham & Watkins 12636 High Bluff Drive, Suite 300 San Diego, CA 92130 Attn.: Robert E. Burwell, Esq. Telephone: (858) 523-5400 Facsimile: (858) 523-5450 Any Party may send any notice, request, demand, claim or other communication hereunder to the intended recipient at the address set forth above using any other means (including personal delivery, expedited courier, messenger service or ordinary mail), but no such notice, request, demand, claim or other communication shall be deemed to have been duly given unless and until it actually is received by the intended recipient. Any Party may change the address to which notices, requests, demands, claims and other communications hereunder are to be delivered by giving the other Parties notice in the manner herein set forth. (h) GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the domestic laws of the State of California without giving effect to any choice or conflict of law provision or rule (whether of the State of California or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of California. (i) AMENDMENTS AND WAIVERS. No amendment of any provision of this Agreement shall be valid unless the same shall be in writing and signed by the Buyer and the Target. No waiver by any Party of any default, misrepresentation or breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence. (j) SEVERABILITY. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any applicable jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other applicable jurisdiction. 15 (k) EXPENSES. Each Party will bear its own costs and expenses (including legal fees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby. (l) CONSTRUCTION. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement. Any reference to any federal, state, local or foreign statute or law shall be deemed also to refer to all rules and regulations promulgated thereunder and any applicable common law, unless the context requires otherwise. The word "including" shall mean including without limitation. The Parties intend that each representation, warranty and covenant contained herein shall have independent significance. If any Party has breached any representation, warranty or covenant contained herein in any respect, the fact that there exists another representation, warranty or covenant relating to the same subject matter (regardless of the relative levels of specificity) which the Party has not breached shall not detract from or mitigate the fact that the Party is in breach of the first representation, warranty or covenant. (m) INCORPORATION OF EXHIBITS, ANNEXES AND SCHEDULES. The Exhibits and Schedules identified in this Agreement are incorporated herein by reference and made a part hereof. (n) SPECIFIC PERFORMANCE. Each of the Parties acknowledges and agrees that the other Parties would be damaged irreparably in the event any of the provisions of this Agreement are not performed in accordance with, their specific terms or otherwise are breached. Accordingly, each of the Parties agrees that the other Parties shall be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically this Agreement and the terms and provisions hereof in any action instituted in any court of the United States or any state thereof having jurisdiction over the Parties and the matter in addition to any other remedy to which they may be entitled, at law or in equity. (o) ARBITRATION. Any dispute arising out of this Agreement, or its performance or breach, shall be resolved by binding arbitration in Los Angeles, California under the Commercial Arbitration Rules (the "AAA RULES") of the American Arbitration Association (the "AAA"). This arbitration provision is expressly made pursuant to and shall be governed by the Federal Arbitration Act, 9 U.S.C. Sections 1-14. The Parties agree that pursuant to Section 9 of the Federal Arbitration Act, a judgment of a United States District Court of competent jurisdiction shall be entered upon the award made pursuant to the arbitration. A single arbitrator, who shall have the authority to allocate the costs of any arbitration initiated under this paragraph, shall be selected according to the AAA Rules within ten (10) days of the submission to the AAA of the response to the statement of claim or the date on which any such response is due, whichever is earlier. The arbitrator shall be required to furnish to the parties to the arbitration a preliminary statement of the arbitrator's decision that includes the legal rationale for the arbitrator's conclusion and the calculations pertinent to any damage award being made by the arbitrator. The arbitrator shall then furnish each of the parties to the arbitration the opportunity to comment upon and/or contest the arbitrator's preliminary statement of decision either, in the discretion of the arbitrator, through briefs or at a hearing. The arbitrator shall render a final decision following any such briefing or hearing. The 16 arbitrator shall conduct the arbitration in accordance with the Federal Rules of Evidence. The arbitrator shall decide the amount and extent of pre-hearing discovery which is appropriate. The arbitrator shall have the power to enter any award of monetary and/or injunctive relief (including the power to issue permanent injunctive relief and also the power to reconsider any prior request for immediate injunctive relief by any Party and any order as to immediate injunctive relief previously granted or denied by a court in response to a request therefor by any Party), including the power to render an award as provided in Rule 43 of the AAA Rules; PROVIDED, HOWEVER THAT THE ARBITRATOR SHALL NOT HAVE THE POWER TO AWARD CONSEQUENTIAL, INDIRECT, PUNITIVE OR EXEMPLARY DAMAGES UNDER ANY CIRCUMSTANCES REGARDLESS OF WHETHER SUCH DAMAGES MAY BE AVAILABLE UNDER APPLICABLE LAW, THE PARTIES HEREBY WAIVE THEIR RIGHTS, IF ANY, TO RECOVER ANY SUCH DAMAGES, WHETHER IN ARBITRATION OR LITIGATION. The arbitrator shall have the power to award the prevailing party its costs and reasonable attorney's fees; PROVIDED, HOWEVER, that the arbitrator shall not award attorneys' fees to a prevailing party if the prevailing party received a settlement offer unless the arbitrator's award to the prevailing party is greater than such settlement offer without taking into account attorneys' fees in the case of the settlement offer or the arbitrator's award. In addition to the above courts, the arbitration award may be enforced in any court having jurisdiction over the Parties and the subject matter of the arbitration. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 17 IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first above written. "BUYER" BJ CHICAGO, LLC, a Delaware limited liability company By: THE JACMAR COMPANIES Its: Managing Member By: /s/ JAMES A. DAL POZZO ------------------------------ Name: James A. Dal Pozzo Title: President "TARGET" CHICAGO PIZZA & BREWERY, INC., a California corporation By: /s/ PAUL MOTENKO ------------------------------------- Name: Paul Motenko Title: 18 EXHIBIT A FORM OF OPINION OF COUNSEL TO TARGET The Buyer shall have received from counsel to the Target an opinion, addressed to the Buyer and dated as of the Closing Date, in form and substance as set forth below: (a) Target has been duly incorporated and is validly existing and in good standing under the laws of the State of California with corporate power and authority to enter into the Facilitation Agreement and to perform its obligations thereunder. (b) The execution, delivery and performance of the Facilitation Agreement have been duly authorized by all necessary corporate action of the Target, and the Facilitation Agreement has been duly executed and delivered by the Target. (c) The Facilitation Agreement constitutes a legally valid and binding obligation of the Target, enforceable against the Target in accordance with its terms. (d) The execution and delivery of the Facilitation Agreement by Target and Buyer and the execution and delivery of the Stock Purchase Agreement by and between Buyer and Seller, and the consummation of the transactions contemplated thereby, do not: (i) violate the provisions of the Certificate of Incorporation or Bylaws of Target, or any judgment, order or decree of any court or arbitrator, known to us, to which Target is a party or is subject; (ii) require any consents, approvals, authorizations, registrations, declarations or filings by the Target under any statute, rule or regulation applicable to the Target; or (iii) result in the breach of or a default under any lease or other agreement of Target identified to us as material to Target by officers of Target. (e) To the best of our knowledge, there are no actions, suits, proceedings or investigations pending against the Target before any court, governmental agency or arbitrator. A-1 DISCLOSURE SCHEDULE EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES CONCERNING TARGET [BEGINS ON THE FOLLOWING PAGE] EX-99.3 4 a2033883zex-99_3.txt EXHIBIT 99.3 EXHIBIT 99.3 STOCK PURCHASE AGREEMENT by and between BJ CHICAGO, as the Buyer and JEREMIAH J. HENNESSEY and PAUL A. MOTENKO, as the Sellers DECEMBER 20, 2000 STOCK PURCHASE AGREEMENT This Stock Purchase Agreement (the "AGREEMENT") is entered into as of December 20, 2000, by and between BJ Chicago, LLC, a Delaware limited liability company, (the "BUYER") and Jeremiah J. Hennessey, an individual ("HENNESSEY"), and Paul A. Motenko, an individual ("MOTENKO"), both of whom are shareholders of Chicago Pizza & Brewery, Inc., a California corporation ("TARGET"). Hennessey and Motenko are each referred to herein as a "Seller" and collectively as the "SELLERS." The Buyer and the Sellers are referred to collectively herein as the "PARTIES." RECITALS A. Hennessey and Motenko own 661,357 and 680,357 shares of the common stock of Target, respectively, which constitute all of the outstanding shares of capital stock of Target held by Sellers; and B. This Agreement contemplates a transaction in which the Buyer will purchase from the Sellers, and the Sellers will sell to the Buyer, in return for cash as set forth below in Section 2, an aggregate of 661,358 shares of Target common stock held by the Sellers. AGREEMENT Now, therefore, in consideration of the premises and the mutual promises herein made, and in consideration of the representations, warranties and covenants herein contained, the Parties agree as follows. 1. DEFINITIONS. "AAA" has the meaning set forth in Section 9(n) below. "AAA RULES" has the meaning set forth in Section 9(n) below. "ACCREDITED INVESTOR" has the meaning set forth in Regulation D promulgated under the Securities Act. "ADVERSE CONSEQUENCES" means all actions, suits, proceedings, hearings, investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid in settlement, Liabilities, obligations, Taxes, liens, losses, expenses, and fees, including court costs and reasonable attorneys' fees and expenses. "AFFILIATE" has the meaning set forth in Rule 12b-2 of the regulations promulgated under the Securities Exchange Act. "ACCREDITED INVESTOR" has the meaning set forth in the preface above. "CLOSING" has the meaning set forth in Section 2(c) below. "CLOSING DATE" has the meaning set forth in Section 2(c) below. "CONFIDENTIAL INFORMATION" means any information concerning the businesses and affairs of Target that is not already generally available to the public. "INDEMNIFIED PARTY" has the meaning set forth in Section 7(c) below. "INDEMNIFYING PARTY" has the meaning set forth in Section 7(c) below. "LIABILITY" means any liability (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for Taxes. "ORDINARY COURSE OF BUSINESS" means the ordinary courage of business consistent with past custom and practice (including with respect to quantity and frequency). "PARTIES" has the meaning set forth in the preface above with each Party being referred to, individually, as a "Party." "PERSON" means an individual, a partnership, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization or a governmental entity (or any department, agency or political subdivision thereof). "PURCHASE PRICE" has the meaning set forth in Section 2(b) below. "SECURITIES ACT" means the Securities Act of 1933, as amended. "SECURITY EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended. "SECURITY INTEREST" means any mortgage, pledge, lien, encumbrance, charge or other security interest. "SELLER" has the meaning set forth in the preface above. "TARGET" has the meaning set forth in the preface above. "TARGET SHARES" mean any shares of the common stock, no par value per share, of Target, with each Target Share being referred to, individually, as a "Target Share." "TAX" or "TAXES" means any federal, state, local, or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premiums windfall profits, environmental (including taxes under Section 59A of the Internal Revenue Code), customs duties, capital stock, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use, transfer, registration, value added, alternative or add-on minimum, estimated, or other tax of any kind whatsoever, including any interest, penalty, or addition thereto, whether disputed or not. The terms "Tax" and "Taxes" include any liability for any of the foregoing items as a result of being a member of any 2 affiliated, consolidated, combined, unitary or similar group and any liability for payment of any amounts as a result of a Tax sharing or indemnity agreement. "THIRD PARTY CLAIM" has the meaning set forth in Section 7(c) below. 2. PURCHASE AND SALE OF TARGET SHARES. (a) BASIC TRANSACTION. On and subject to the terms and conditions of this Agreement, the Buyer agrees topurchase from the Sellers, and the Sellers agree to sell to the Buyer, an aggregate of 661,358 Target Shares, as follows:
SELLER NUMBER OF TARGET SHARES SOLD ------ ----------------------------- Hennessey 330,679 Motenko 330,679
(b) PURCHASE PRICE. Upon the terms and subject to the conditions contained herein, as consideration for the purchase of the Target Shares to be sold by the Sellers as set forth in Section 2(a), above, on the Closing Date, the Buyer will pay the Sellers in cash a price of $2.75 per share for an aggregate purchase price of $1,818,734.50 (the "PURCHASE PRICE"), which shall be paid by Buyer by same day wire transfer, cashier's check or other "same day funds" acceptable to the Sellers. The Purchase Price shall be allocated among the Sellers in proportion to their respective holdings of Target Shares. (c) THE CLOSING. The closing of the transactions contemplated by this Agreement (the "CLOSING") shall take place at the offices of Latham & Watkins at 12636 High Bluff Drive, Suite 300, San Diego, California, commencing at 10:00 a.m. local time on January 18, 2001 or, if any of the conditions set forth in Section 6(a) (other than conditions with respect to actions the respective Parties will take at the Closing itself) has not been satisfied, a later date selected by the Buyer, which date shall be within five business days following the satisfaction or waiver of all conditions to the obligations of the Parties to consummate the transactions contemplated hereby (other than conditions with respect to actions the respective Parties will take at the Closing itself) (such date, the "CLOSING DATE"). (d) DELIVERIES AT THE CLOSING. At the Closing, (i) the Sellers will deliver to the Buyer stock certificates representing an aggregate of 661,358 Target Shares endorsed in blank or accompanied by duly executed assignment documents, and (ii) the Buyer will deliver to the Sellers the consideration specified in Section 2(b) above. 3. REPRESENTATIONS AND WARRANTIES CONCERNING THIS TRANSACTION. (a) REPRESENTATIONS AND WARRANTIES OF THE SELLERS. Each Seller represents and warrants, as to himself, to the Buyer that the statements contained in this Section 3(a) are correct and complete as of the date of this Agreement. (i) AUTHORIZATION OF TRANSACTION. The Seller has full power and authority to execute and deliver this Agreement and to perform his obligations hereunder. This Agreement constitutes the valid and legally binding obligation of the Seller, enforceable in accordance with 3 its terms and conditions. The Seller need not give any notice to, make any filing with, or obtain any authorization, consent or approval of any government or governmental agency in order to consummate the transactions contemplated by this Agreement. (ii) NON-CONTRAVENTION. Neither the execution and the delivery of this Agreement, nor the consummation of the transactions contemplated hereby, will (A) violate any constitution statute, regulation, rule, injunction, judgment, order, decree, ruling, charge or other restriction of any government, governmental agency or court to which the Seller is subject or (B) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify or cancel, or require any notice under any agreement, contract, lease, license, instrument or other arrangement to which the Seller is a party or by which it is bound or to which any of its assets are subject, except where the conflict, breach, default, acceleration, termination, modification, cancellation or failure to give notice would not have a material adverse effect on the ability of the parties to consummate the transactions contemplated hereby. (iii) TARGET SHARES. Hennessey and Motenko hold of record and own beneficially 661,357 and 680,357 Target Shares, respectively, free and clear of any restrictions on transfer (other than any restrictions under the Securities Act and state securities laws), Taxes, Security Interests, options, warrants, purchase rights, contracts, commitments, equities, claims, encumbrances and demands. The Seller is not a party to any option, warrant, purchase right or other contract or commitment that could require the Seller to sell, transfer or otherwise dispose of any capital stock of Target or any of the assets of Target (other than this Agreement). The Seller is not a party to any voting trust, proxy or other agreement or understanding with respect to the voting of any capital stock of Target. (b) REPRESENTATIONS AND WARRANTIES OF THE BUYER. The Buyer represents and warrants to the Sellers that the statements contained in this Section 3(b) are correct and complete as of the date of this Agreement and will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this Section 3(b)). (i) ORGANIZATION, QUALIFICATION AND CORPORATE POWER. The Buyer is a limited liability company duly organized, validly existing and in good standing under the laws of Delaware. The Buyer has full power and authority (including full corporate power and authority) to execute this Agreement and to perform its obligations hereunder. This Agreement constitutes the valid and legally binding obligation of the Buyer, enforceable in accordance with its terms and conditions. The Buyer need not give any notice to, make any filing with, or obtain any authorization, consent or approval of any government or governmental agency in order to consummate the transactions contemplated by this Agreement. (ii) INVESTMENT. The Buyer is not acquiring the Target Shares with a view in connection with any distribution thereof within the meaning of the Securities Act. (iii) ACCREDITED INVESTOR. The Buyer is an Accredited Investor within the meaning of Rule 501(a) under the Securities Act, and the Target Shares to be acquired by it pursuant to this Agreement are being acquired for its own account, not as a nominee or agent, 4 and not with a view to, or for sale in connection with, any distributions thereof. The Buyer has such knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risks of its investment in the shares, and it is capable of bearing the economic risks of such investment. 4. PRE-CLOSING COVENANTS. The Parties agree as follows with respect to the period between the execution of this Agreement and the Closing. (a) GENERAL. Each of the Parties will use its reasonable best efforts to take all action and to do all things necessary, proper or advisable in order to consummate and make effective the transactions contemplated by this Agreement (including satisfaction, but not waiver, of the closing conditions set forth in Section 6 below). (b) NOTICE OF DEVELOPMENTS. Each Party will give prompt written notice to the other of any material adverse development causing a breach of any of its own representations and warranties in Section 3 above. No disclosure by any Party pursuant to this Section 4(b), however, shall be deemed to cure any misrepresentation or breach of warranty or breach of covenant. (c) EXCLUSIVITY. The Sellers will not permit or cause any of their respective affiliates or agents to, directly or indirectly, (i) solicit, initiate or encourage the submission of any proposal or offer from any Person relating to the acquisition of any capital stock or other voting securities, or any substantial portion of the assets of, Target (including any acquisition structured as a merger, consolidation or share exchange) or (ii) participate in any discussions or negotiations regarding, furnish any information with respect to, assist or participate in or facilitate in any other manner any effort or attempt by any Person to do or seek any of the foregoing. Neither of the Sellers will vote his Target Shares in favor of any such acquisition structured as a merger, consolidation or share exchange. The Sellers will notify the Buyer immediately if any Person makes any proposal, offer, inquiry or contact with respect to any of the foregoing. In addition, the Sellers will not reallocate, issue, transfer, sell, pledge or otherwise dispose of any equity interests in the Target prior to the Closing. Further, the Sellers will not and will not cause or permit any of their respective affiliates or agents to, directly or indirectly, discuss, negotiate or consider any other proposals or inquiries from any other persons or entities relating to the sale or other transfer of the Target Shares. 5. POST-CLOSING COVENANTS. The Parties agree that if at any time after the Closing any further action is necessary or desirable to carry out the purposes of this Agreement, each of the Parties will take such further action (including the execution and delivery of such further instruments and documents) as any other Party reasonably may request, all at the sole cost and expense of the requesting Party (unless the requesting Party is entitled to indemnification therefor under Section 7 below). 6. CONDITIONS TO OBLIGATION TO CLOSE. 5 (a) CONDITIONS TO OBLIGATION OF THE BUYER. The obligation of the Buyer to consummate the transactions to be performed by it in connection with the Closing is subject to satisfaction of the following conditions: (i) the representations and warranties set forth in Section 3(a) above shall be true and correct in all material respects at and as of the Closing Date; (ii) the Sellers shall have performed and complied with all of their covenants hereunder in all material respects through the Closing; (iii) no action, suit or proceeding shall be pending or threatened before any court or quasi-judicial or administrative agency of any federal, state, local or foreign jurisdiction or before any arbitrator wherein an unfavorable injunction, judgment, order, decree, ruling or charge would (A) prevent consummation of any of the transactions contemplated by this Agreement, (B) cause any of the transactions contemplated by this Agreement to be rescinded following consummation (and no such injunction, judgment, order, decree, ruling or charge shall be in effect), or (C) affect adversely the right of the Buyer to own the Target Shares; and (iv) from the date hereof through the Closing Date, there shall have been no material adverse change in the financial condition, results of operations, properties, business or prospects of Target. (v) Buyer shall have received an opinion of counsel to the Sellers in form and substance reasonably acceptable to Buyer covering the matters set forth in Exhibit A attached hereto. All actions to be taken by the Sellers in connection with consummation of the transactions contemplated hereby and all certificates, opinions, instruments and other documents required to effect the transactions contemplated hereby will be reasonably satisfactory in form and substance to the Buyer. The Buyer may waive any condition specified in this Section 6(a) if it executes a writing so stating at or prior to the Closing. (b) CONDITIONS TO OBLIGATION OF THE SELLERS. The obligation of the Sellers to consummate the transactions to be performed by them in connection with the Closing is subject to satisfaction of the following conditions: (i) the representations and warranties set forth in Section 3(b) above shall be true and correct in all material respects at and as of the Closing Date; (ii) the Buyer shall have performed and complied with all of its covenants hereunder in all material respects through the Closing; and (iii) no action, suit or proceeding shall be pending or threatened before any court or quasi-judicial or administrative agency of any federal, state, local or foreign jurisdiction or before any arbitrator wherein an unfavorable injunction, judgment, order, decree, ruling or charge would (A) prevent consummation of any of the transactions contemplated by this Agreement or (B) cause any of the transactions contemplated by this Agreement to be rescinded 6 following consummation (and no such injunction, judgment, order, decree, ruling or charge shall be in effect). All actions to be taken by the Buyer in connection with consummation of the transactions contemplated hereby and all certificates, opinions, instruments and other documents required to effect the transactions contemplated hereby will be reasonably satisfactory in form and substance to the Sellers. The Sellers may waive any condition specified in this Section 6(b) by executing a writing so stating at or prior to the Closing. 7. REMEDIES FOR BREACHES OF THIS AGREEMENT. (a) INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE BUYER. (i) In the event the Sellers breach (or in the event any third party alleges facts that, if true, would mean the Sellers have breached) any of their respective representations, warranties and covenants contained herein, then the Sellers agree to indemnify the Buyer from and against the entirety of any Adverse Consequences the Buyer may suffer through and after the date of the claim for indemnification resulting from, arising out of, relating to, or caused by the breach (or the alleged breach). (b) INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE SELLERS. In the event the Buyer breaches (or in the event any third party alleges facts that, if true, would mean the Buyer has breached) any of its representations, warranties and covenants contained herein, then the Buyer agrees to indemnify the Sellers from and against the entirety of any Adverse Consequences the Sellers may suffer through and after the date of the claim for indemnification resulting from, arising out of, relating to, or caused by the breach (or the alleged breach), (c) MATTERS INVOLVING THIRD PARTIES. (i) If any third party shall notify any Party (the "INDEMNIFIED PARTY") with respect to any matter (a "THIRD PARTY CLAIM") which may give rise to a claim for indemnification against any other Party (the "Indemnifying Party") under this Section 7, then the Indemnified Party shall promptly notify the Indemnifying Party thereof in writing; provided, however, that no delay on the part of the Indemnified Party in notifying any Indemnifying Party shall relieve the Indemnifying Party from any obligation hereunder unless (and then solely to the extent) the Indemnifying Party thereby is prejudiced. (ii) Any Indemnifying Party will have the right to defend the Indemnified Party against the Third Party Claim with counsel of its choice reasonably satisfactory to the Indemnified Party so long as (A) the Indemnifying Party notifies the Indemnified Party in writing within 15 days after the Indemnified Party has given notice of the Third Party Claim that the Indemnifying Party will indemnify the Indemnified Party from and against the entirety of any Adverse Consequences the Indemnified Party may suffer resulting from, arising out of, relating to, in the nature of, or caused by the Third Party Claim, (B) the Indemnifying Party provides the Indemnified Party with evidence reasonably acceptable to the Indemnified Party that the Indemnifying Party will have the financial resources to defend against the Third Party Claim and fulfill its indemnification obligations hereunder, and (C) the Indemnifying Party conducts the defense of the Third Party Claim actively and diligently. 7 (iii) So long as the Indemnifying Party is conducting the defense of the Third Party Claim in accordance with Section 7(c)(ii) above, (A) the Indemnified Party may retain separate co-counsel at its sole cost and expense and participate in the defense of the Third Party Claim, (B) the Indemnified Party will not consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim without the prior written consent of the Indemnifying Party (such consent not to be withheld unreasonably) and (C) the Indemnifying Party will not consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim without the prior written consent of the Indemnified Party (such consent not to be withheld unreasonably and such consent not to be withheld at all if the judgment or settlement contains a full release reasonably satisfactory to the Indemnified Party). (iv) In the event any of the conditions in Section 7(c)(ii) above is or becomes unsatisfied, however, (A) the Indemnified Party may defend against, and consent to the entry of any judgment or enter into any settlement with respect to, the Third Party Claim in any manner it reasonably may deem appropriate (and the Indemnified Party need not consult with, or obtain any consent from, any Indemnifying Party in connection therewith), (B) the Indemnifying Party will reimburse the Indemnified Party promptly and periodically for the costs of defending against the Third Party Claim (including reasonable attorneys' fees and expenses) and (C) the Indemnifying Party will remain responsible for any Adverse Consequences the Indemnified Party may suffer resulting from, arising out of, relating to, in the nature of, or caused by the Third Party Claim to the fullest extent provided in this Section 7. 8. TERMINATION. (a) TERMINATION OF AGREEMENT. The Parties may terminate this Agreement as provided below: (i) the Buyer and the Sellers may terminate this Agreement by mutual written consent at any time prior to the Closing; (ii) the Buyer may terminate this Agreement by giving written notice to the Sellers at any time prior to the Closing (A) in the event the Sellers have breached any material representation, warranty or covenant contained in this Agreement in any material respect, the Buyer has notified the Sellers of the breach and the breach has continued, without cure for a period of 10 days after the notice of breach or (B) if the Closing shall not have occurred on or before January 18, 2001 by reason of the failure of any condition precedent under Section 5(a) hereof (unless the failure results primarily from the Buyer itself breaching any representation, warranty or covenant contained in this Agreement); and (iii) The Sellers may terminate this Agreement by giving written notice to the Buyer at any time prior to the Closing (A) in the event the Buyer has breached any material representation, warranty or covenant contained in this Agreement in any material respect, the Sellers have notified the Buyer of the breach and the breach has continued without cure for a period of 10 days after the notice of breach or (B) if the Closing shall not have occurred on or before January 18, 2001 by reason of the failure of any condition precedent under Section 6(b) hereof (unless the failure results primarily from the Sellers themselves breaching any representation or warranty or covenant contained in this Agreement). 8 (b) EFFECT OF TERMINATION. If either Party terminates this Agreement pursuant to Section 8(a) above, all rights and obligations of the Parties hereunder shall terminate without any Liability of any Party to any other Party (except for any Liability of any Party then in breach). In addition, in the event of termination of this Agreement pursuant to Section 8(a) above, each Party will redeliver all documents, work papers and other material of any other Party relating to the transactions contemplated hereby, whether obtained before or after the execution hereof, to the Party furnishing the same. 9. MISCELLANEOUS. (a) CONFIDENTIALITY OF AGREEMENT, PRESS RELEASES AND PUBLIC ANNOUNCEMENTS. Except as set forth below, the Parties shall, and shall cause their officers, employees and representatives to, treat and hold as confidential the existence and terms of this Agreement at all times prior to the Closing Date. Specifically, no Party shall issue any press release or make any public announcement relating to the subject matter of this Agreement prior to the Closing without the prior written approval of the Buyer and the Seller; provided, however, that any Party may make any public disclosure it believes in good faith is required by applicable law or any listing or trading agreement concerning its publicly-traded securities to make such disclosure (in which case the disclosing Party will use its reasonable best efforts to advise the other Parties prior to making the disclosure). (b) NO THIRD-PARTY BENEFICIARIES. This Agreement shall not confer any rights or remedies upon any Person other than the Parties and their respective successors and permitted assigns. (c) ENTIRE AGREEMENT. This Agreement (including the documents referred to herein) constitutes the entire agreement among the Parties and supersedes any prior understandings, agreements or representations by or among the Parties, written or oral, to the extent they relate in any way to the subject matter hereof (d) SUCCESSION AND ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of the Parties named herein and their respective successors and permitted assigns. No Party may assign either this Agreement or any of its rights, interests or obligations hereunder without the prior written approval of the Buyer and the Sellers; provided, however, that the Buyer may (i) assign any or all of its rights and interests hereunder to one or more of its Affiliates and (ii) designate one or more of its Affiliates to perform its obligations hereunder (in any or all of which cases the Buyer nonetheless shall remain responsible for the performance of all of its obligations hereunder). (e) COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. (f) HEADINGS. The section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement. 9 (g) NOTICES. All notices, requests, demands, claims and other communications hereunder will be in writing. Any notice, request, demand, claim or other communication hereunder shall be deemed duly given if (and then two business days after) it is sent by registered or certified mail, return receipt requested, postage prepaid and addressed to the intended recipient as set forth below: IF TO THE SELLERS: Jeremiah J. Hennessey 16162 Beach Boulevard, Suite 100 Huntington Beach, CA 92647 Facsimile: (714) 848-5587 Paul A. Motenko 16162 Beach Boulevard, Suite 100 Huntington Beach, CA 92647 Facsimile: (714) 848-5587 WITH A COPY TO: Steven J. Insel, Esq. Jeffer, Mangels, Butler & Marmaro 2121 Avenue of the Stars, 10th Floor Los Angeles, CA 90067 Facsimile: (310) 203-0567 IF TO THE BUYER: BJ Chicago, LLC c/o The Jacmar Companies, Inc. 2200 W. Valley Boulevard Alhambra, CA 91803 Attn: James A. Dal Pozzo Telephone: (626) 576-0737 Facsimile: (626) 576-2211 WITH A COPY TO: Latham & Watkins 12636 High Bluff Drive, Suite 300 San Diego, CA 92130 Attn.: Robert E. Burwell, Esq. Telephone: (858) 523-5400 Facsimile: (858) 523-5450 Any Party may send any notice, request, demand, claim or other communication hereunder to the intended recipient at the address set forth above using any other means (including personal delivery, expedited courier, messenger service or ordinary mail), but no such notice, request, 10 demand, claim or other communication shall be deemed to have been duly given unless and until it actually is received by the intended recipient. Any Party may change the address to which notices, requests, demands, claims and other communications hereunder are to be delivered by giving the other Parties notice in the manner herein set forth. (h) GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the domestic laws of the State of California without giving effect to any choice or conflict of law provision or rule (whether of the State of California or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of California. (i) AMENDMENTS AND WAIVERS. No amendment of any provision of this Agreement shall be valid unless the same shall be in writing and signed by the Buyer and the Seller. No waiver by any Party of any default, misrepresentation or breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence. (j) EXPENSES. Each of the Parties will bear its own costs and expenses (including legal fees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby. (k) CONSTRUCTION. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement. Any reference to any federal, state, local or foreign statute or law shall be deemed also to refer to all rules and regulations promulgated thereunder and any- applicable common law, unless the context requires otherwise. The word "including" shall mean including without limitation. (l) SPECIFIC PERFORMANCE. Each of the Parties acknowledges and agrees that the other Parties would be damaged irreparably in the event any of the provisions of this Agreement are not performed in accordance with, their specific terms or otherwise are breached. Accordingly, each of the Parties agrees that the other Parties shall be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically this Agreement and the terms and provisions hereof in any action instituted in any court of the United States or any state thereof having jurisdiction over the Parties and the matter in addition to any other remedy to which they may be entitled, at law or in equity. (m) INCORPORATION OF EXHIBITS, ANNEXES AND SCHEDULES. The Exhibits identified in this Agreement are incorporated herein by reference and made a part hereof (n) ARBITRATION. Any dispute arising out of this Agreement, or its performance or breach, shall be resolved by binding arbitration in Los Angeles, California under the Commercial Arbitration Rules (the "AAA RULES") of the American Arbitration Association (the "AAA"). This arbitration provision is expressly made pursuant to and shall be governed by the Federal Arbitration Act, 9 U. S. C. Sections 1-14 as well as the AAA Rules. The Parties agree that 11 pursuant to Section 9 of the Federal Arbitration Act, a judgment of a United States District Court of competent jurisdiction shall be entered upon the award made pursuant to the arbitration. A single arbitrator, who shall have the authority to allocate the costs of any arbitration initiated under this paragraph, shall be selected according to the AAA Rules within ten (10) days of the submission to the AAA of the response to the statement of claim or the date on which any such response is due, whichever is earlier. The arbitrator shall be required to furnish to the parties to the arbitration a preliminary statement of the arbitrator's decision that includes the legal rationale for the arbitrator's conclusion and the calculations pertinent to any damage award being made by the arbitrator. The arbitrator shall then furnish each of the parties to the arbitration the opportunity to comment upon and/or contest the arbitrator's preliminary statement of decision either, in the discretion of the arbitrator, through briefs or at a hearing. The arbitrator shall render a final decision following any such briefing or hearing. The arbitrator shall conduct the arbitration in accordance with the Federal Rules of Evidence and the AAA Rules. The arbitrator shall decide the amount and extent of the pre-hearing discovery which is appropriate. The arbitrator shall have the power to enter any award of monetary and/or injunctive relief (including the power to issue permanent injunctive relief and also the power to reconsider any prior request for immediate injunctive relief by any Party and any order as to immediate injunctive relief previously granted or denied by a court in response to a request therefor by any Party), including the power to render an award as provided in Rule 43 of the AAA Rules; PROVIDED, HOWEVER THAT THE ARBITRATOR SHALL NOT HAVE THE POWER TO AWARD CONSEQUENTIAL, INDIRECT, PUNITIVE OR EXEMPLARY DAMAGES UNDER ANY CIRCUMSTANCES REGARDLESS OF WHETHER SUCH DAMAGES MAY BE AVAILABLE UNDER APPLICABLE LAW, THE PARTIES HEREBY WAIVE THEIR RIGHTS, IF ANY, TO RECOVER ANY SUCH DAMAGES, WHETHER IN ARBITRATION OR LITIGATION. The arbitrator shall have the power to award the prevailing party its costs and reasonable attorney's fees; provided, however, that the arbitrator shall not award attorneys' fees to a prevailing party if the prevailing party received a settlement offer unless the arbitrator's award to the prevailing party is greater than such settlement offer without taking into account attorneys' fees in the case of the settlement offer or the arbitrator's award. In addition to the above courts, the arbitration award may be enforced in any court having jurisdiction over the Parties and the subject matter of the arbitration. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 12 IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first above written. "BUYER" BJ CHICAGO, LLC, a Delaware limited liability company By: THE JACMAR COMPANIES Its: Managing Member By: /s/ JAMES A. DAL POZZO --------------------------------------- Name: James A. Dal Pozzo Title: President "SELLERS" /s/ JEREMIAH J. HENNESSEY ------------------------------------------- JEREMIAH J. HENNESSEY /s/ PAUL A. MOTENKO ------------------------------------------- PAUL A. MOTENKO 13 EXHIBIT A FORM OF OPINION OF COUNSEL TO SELLERS The Buyer shall have received from counsel to the Sellers an opinion, addressed to the Buyer and dated as of the Closing Date, in form and substance as set forth below: (a) The Stock Purchase Agreement has been duly executed and delivered by the Sellers. (b) The Stock Purchase Agreement constitutes a legally valid and binding obligation of the Sellers, enforceable against the Sellers in accordance with its terms. (c) No registration of the Target Shares under the Securities Act is required in connection with the offer, purchase, sale and delivery of the Target Shares in the manner contemplated by the Stock Purchase Agreement. 14 -----END PRIVACY-ENHANCED MESSAGE-----