INDEPENDENT CONTRACTOR CONSULTING AGREEMENT

 

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                                                                    Exhibit 10.1

 

                         MAX & ERMA'S RESTAURANTS, INC.

 

                             INDEPENDENT CONTRACTOR

                              CONSULTING AGREEMENT

 

      THIS AGREEMENT (the "Agreement") is made by and between Max & Erma's

Restaurants, Inc., an Ohio corporation with its principal offices located at

4849 Evanswood Drive, Columbus, Ohio 43229 (the "Company"), and Bonnie Brannigan

residing 7112 Timberview Drive, Dublin, Ohio 43017 ("Consultant").

 

                                    RECITALS

 

      A. Company owns, operates and franchises Max & Erma's casual theme

restaurants (the "Company's Business").

 

      B. Consultant has been employed by the Company since 1996 as its Vice

President of Marketing and Strategic Planning and has submitted her resignation

as an officer and employee of the Company and any of its subsidiaries effective

July 25, 2005, and thereafter intends to be self employed as a business

consultant in the areas of marketing, strategic planning and corporate

communications.

 

      C. Company wishes to retain certain consulting services of Consultant on

the terms described below, and Consultant has agreed to provide such services.

 

                                    AGREEMENT

 

      In consideration of the foregoing, and of their mutual promises contained

herein, the parties agree as follows:

 

      1. ENGAGEMENT; SCOPE OF SERVICES. Company hereby engages Consultant to

assist Company in its marketing, strategic planning and intranet development as

may be determined from time to time by Company's President and Chief Executive

Officer (the "Services"), and Consultant agrees to render the Services under the

terms and conditions set forth in this Agreement.

 

      2. METHOD AND TIME OF PERFORMING THE SERVICES. Consultant shall exercise

her best efforts to perform the Services, and shall determine the method,

details, and means of performing the Services.

 

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      3. CONSULTING FEE AND EXPENSES.

 

            (a) Company shall pay Consultant a consulting fee at an hourly rate

of $125.00 for the Services, which will be invoiced to Company within 10 days

after the conclusion of each month of the contract term.

 

            (b) During the first six months of this Agreement, Company will

request that Consultant expend, and the Consultant agrees to expend, at least

260 hours rendering the Services, on such dates and times as the Company

reasonably requests, and Company will incur a liability to Consultant for at

least $32,500.00 during the six-month period this Agreement remains in effect

from July 25, 2005 through January 25, 2006.

 

            (c) Company will reimburse Consultant for direct, reasonable and

necessary out-of-pocket expenses incurred in the performance of this Agreement

(such as out of town travel expenses, long distance telephone charges, copy

expenses, etc.), upon receipt of an invoice from Consultant and, if requested,

supporting documentation therefore; provided, however, that any expense item

exceeding $500 shall require pre-approval by Company.

 

      4. SERVICES NOT EXCLUSIVE; LIMITATIONS ON SERVICES TO OTHERS. Company

acknowledges that Consultant intends to and may seek engagement by other clients

for consulting services, including services in the areas of marketing, strategic

planning and intranet development, during the Term (as defined below) of this

Agreement. However, Consultant agrees that during the Term of this Agreement,

Consultant shall not, directly or indirectly, in any capacity, for the benefit

of herself or any other party, provide services similar to the Services rendered

or to be rendered to Company hereunder to any competitive restaurant business as

defined in Exhibit A hereto without the express prior written consent of the

Company.

 

      5. NO CONFLICT WITH OTHER AGREEMENTS. Consultant represents and warrants

to Company that the execution, delivery and performance by Consultant of this

Agreement will not conflict with or result in a breach of any of the terms,

conditions or provisions of, or constitute (with due notice or lapse of time or

both) a default under, any agreement or instrument to which Consultant is a

party or by which she is bound or any other legally enforceable duty of

Consultant to any former employer other than Company or person or entity for

whom she has previously provided consulting or employment services.

 

      6. TERM AND TERMINATION; SURVIVAL.

 

            (a) The initial term of this Agreement shall commence on the date it

is signed, which shall not be before July 25, 2005 (the "Effective Date"). This

Agreement shall terminate on the earliest of the following: (i) death or

disability of Consultant, rendering Consultant unable to perform her duties

under this Agreement; (ii) termination of this Agreement by Company by reason of

the breach thereof by Consultant; or (iii) January 25, 2006 (the "Term"). After

December 31, 2005, this Agreement shall automatically continue unless and until

either party gives at least fourteen (14) days advance written notice of

termination or Company gives written notice of breach of this Agreement by

Consultant.

 

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            (b) The agreements set forth in paragraphs 3, 8, 10, 11, 12, and 16

of this Agreement shall survive termination of this Agreement.

 

      7. INDEPENDENT CONTRACTOR. The parties acknowledge and agree that

Consultant is an independent contractor with full rights to govern her own

conduct and agree that the Consultant shall have no authority to bind Company in

any respect whatsoever. Consultant is not an employee, partner or joint venturer

of Company. Consultant shall not be treated as an employee of Company for

federal or state tax purposes, unemployment or disability benefits, or for any

other withholding tax or insurance purposes. Consultant shall pay, when and as

due, any and all taxes and related assessments incurred as a result of payments

by Company to Consultant hereunder, including estimated taxes. Company shall

have no obligation to compensate Consultant or provide Consultant with benefits

in respect of sickness or accident, whether or not resulting from the

performance by Consultant of the obligations under this Agreement; retirement or

pension; or any other benefits provided by Company to any of its employees.

Consultant shall indemnify and hold harmless Company from and against all

assessments, claims, liabilities, costs, expenses, and damages that Company may

suffer or incur with respect to any of the foregoing matters.

 

      8. RELEASE OF CLAIMS. In exchange for engaging Consultant as a consultant

to Company hereunder and the promise to pay the fees provided in this Agreement,

and other valuable consideration expressed in this Agreement, the adequacy of

which Consultant expressly acknowledges, Consultant hereby releases and forever

discharges Company, and all of its affiliates, parent corporations,

subsidiaries, divisions, predecessors, successors, and assigns, and all of their

respective directors, officers, agents and employees, personally and in their

representative and official capacities, from any and all local, state and

federal lawsuits, claims, remedies, damages, demands, discrimination suits or

charges, costs and attorneys fees, and any causes of action of whatever type or

nature, whether legal or equitable, whether known, unknown or unforeseen and

existing as of July 25, 2005. The rights, liabilities, claims and actions

released, waived and extinguished here by Consultant, and with respect to which

Consultant covenants not to sue, shall include but not be limited to those

arising or which might arise under Title VII of the Civil Rights Act of 1964;

any and all claims under the Civil Rights Act of 1866; any and all claims under

the Americans With Disabilities Act of 1990; any and all claims under the Age

Discrimination in Employment Act, as amended, including the Older Workers

Benefit Protection Act of 1990; any and all claims under Family Medical