SEPARATION AGREEMENT

Exhibit 10.34

SEPARATION AGREEMENT

     This Agreement, dated December 1, 2008 for reference purposes only, effects an agreeable separation of the employment relationship between Russell Owens (“Owens”) and P.F. Chang’s China Bistro, Inc. (“PFC”), as well as a resolution of any claims, known and unknown, now existing between Owens and PFC. The terms of the Agreement are as follows:

     1.  Termination of Employment Relationship. Through mutual agreement, the employment relationship between the parties will terminate effective December 5, 2008.

     2.  Consideration . In consideration for each of the terms of this Agreement,

          a. PFC will pay Owens a salary replacement, lump sum amount of $800,000.00, less all applicable federal and state withholding and income taxes (“Separation Payment”). The Separation Payment will be made by check, delivered to Owens’ last-known home address within ten (10) business days after the expiration of the revocation period set forth in Paragraph 12 below; and

          b. PFC will cause Owens all unvested portions of Owens’ equity awards to become fully vested as of December 5, 2008, and will allow Owens to exercise such stock options for a period of two (2) years from the effective date of this Agreement.

          c. Owens acknowledges and agrees that the consideration outlined in Paragraphs 2(a) and 2(b) constitutes adequate legal consideration for the promises and representations made by him in this Separation Agreement, and represents amounts to which he is not otherwise entitled. Owens further waives any entitlement to any severance payment, separation payment, or any other payment or benefit under any other agreement with PFC or Pei Wei Asian Diner, Inc. (“PW”), whether written or oral. Owens also acknowledges that PFC and PW have paid to him all amounts due related to his employment, including but not limited to any bonuses, salary, or severance payments.

          d. Owens acknowledges that he will be exclusively liable for the payment of all federal, state, and local taxes, if any, which may be due as a result of the consideration received pursuant to this Agreement. In addition, if PFC, PW, or any affiliated entity who made payment on their behalf is required at any time to pay any taxes or other amounts, including without limitation penalties or interest or reasonable attorneys’ fees, for failing to withhold sufficient federal or state income or withholding taxes on the payment made to Owens pursuant to this Agreement, or on account of Owens failing to pay taxes on such payment, Owens agrees to indemnify PFC, PW, or any affiliated entity and hold them harmless from any penalties, claims, lawsuits, attorneys’ fees, and expenses.

     3.  Complete Agreement. This Agreement sets forth the entire Agreement between the parties, except that the non-competition, non-solicitation, and confidentiality provisions outlined in Paragraphs 9, 10, 11, and 12 of Owens’ May 2008 employment agreement, attached to this Agreement as Exhibit A (“Employment Agreement”) remain in full force and effect and are incorporated herein by reference. Owens acknowledges that the consideration outlined in Paragraph 2 of this Agreement is adequate legal consideration for his continuing

obligations under Paragraphs 9, 10, 11, and 12 of the Employment Agreement. The parties hereby terminate all other provisions of the Employment Agreement and any other previous agreements, effective on December 5, 2008. This Agreement supersedes all previous representations, negotiations, discussions, and agreements, whether oral or written.

     4.  Cooperation. Owens shall fully cooperate with PFC and PW in connection with matters that legitimately require Owens’ assistance, including, without limitation, lawsuits presently pending or hereafter brought against PFC or PW, threatened claims, tax returns, tax or other audits, financial statements, and other finance, operational, legal, and accounting matters. Such cooperation will include, without limitation, providing information to PFC or PW when requested and in a prompt and thorough manner, and testifying when reasonably determined necessary by PFC, PW, or their legal counsel. PFC will reimburse Owens for his reasonable out-of-pocket expenses incurred in connection with such cooperation upon submission to PFC of appropriate receipts and vouchers.

     5.  Release and Covenant Not To Sue. Owens agrees that he will not initiate or cause to be initiated against PFC, PW, or their affiliates and subsidiaries, or any of their current, past, or future agents, attorneys, servants, employees, partners, owners, affiliated business entities, or any person or entity acting by, through, under or in concert with them (collectively referred to as “Released Parties”) any lawsuit, compliance review, action, grievance proceeding or appeal, investigation or proceeding of any kind (collectively referred to as “claims”), or participate in same, individually or as a representative or a member of a class, under any contract (express or implied), law or regulation (federal, state, or local), including but not limited to claims pertaining to or in any way related to his employment with PFC or PW.

      Owens understands and acknowledges that this release forever bars him from suing or otherwise asserting a claim against PFC, PW, or the other Released Parties on the basis of any event, contract, or agreement occurring on or before the effective date of this Agreement, whether the facts are now known or unknown, and whether the legal theory upon which such claim might be based is now known or unknown.

     6.  Release of Damages. Owens agrees that pursuant to this Agreement, he releases and forever discharges PFC, PW, and the other Released Parties from any and all claims, demands, damages, causes of action, and any liability whatsoever, including but not limited to claims on account of or in any manner arising out of Owens’ employment or termination of employment with PFC or PW. By way of example only, and without limiting this release, Owens releases PFC, PW, and the other Released Parties from any cause of action, right, claim or liability under the Age Discrimination in Employment Act, Title VII of the 1964 Civil Rights Act, as amended, the Fair Labor Standards Act, the United States Constitution, and all state counterparts, and any other equal employment opportunity law or statute, any common law claim including wrongful discharge, implied or express contract, the covenant of good faith and fair dealing, or any other claim in tort or contract arising under the law, including but not limited to any claims arising under the Employment Agreement or any other prior agreements between the parties.

     7.  Provision for Unknown Claims. Owens warrants that he does not have any claim, charge, or complaint, either formal or informal, pending against PFC, PW, or any of the other Released Parties with or before any court, tribunal, administrative agency, governmental agency, or other such body. Owens further waives any right to monetary recovery should any administrative or governmental agency pursue any released claim on his behalf.

     8.  Bar. Owens agrees that this Agreement may be pleaded as a complete bar to any action or suit before any court, with respect to any claim under federal, state or other law relating to his employment or termination of employment from PFC or PW.

     9.  Indemnification. Owens agrees to indemnify and hold harmless PFC, PW, and the other Released Parties from and against any and all loss, costs, damages or expenses, including without limitation, attorneys’ fees, arising out of a breach of this Agreement or the fact that any representation made herein was false when made.

     10.  Confidentiality and Non-Disparagement.

          10.1 Owens agrees that he will keep both the existence and terms of this Agreement completely confidential and will not disclose the contents of this Agreement to anyone except his tax advisor, attorney and/or spouse, unless required to do so by force of law. Owens further agrees that he will not disparage PFC, PW, or any of their affiliated or related entities, employees, or partners, in any way, including but not limited to making negative statements or implications, in written or verbal form, to current or potential customers, vendors, or employees of PFC, PW, or their affiliates. Any disclosure or breach of this confidentiality and non-disparagement provision shall be deemed a material breach of this Agreement.

          10.2 Owens agrees that he will not use, remove from PFC’s premises, make unauthorized copies of or disclose any confidential or proprietary information of PFC, PW, or any affiliated or related entities, including but not limited to, their trade secrets, copyrighted information, customer lists, any information encompassed in any research and development, reports, work in progress, drawings, software, computer files or models, designs, plans, proposals, marketing and sales programs, financial projections, and all concepts or ideas, materials or information related to the business or sales of PFC, PW, and any affiliated or related entities that has not previously been released to the public by an authorized representative of those entities.

          10.3 Within five (5) days after the date of Owens’ execution hereof, Owens shall return to PFC all PFC, PW, and the other Released Parties’ property, including all confidential and proprietary information, as described in paragraph 10.2 above, and all materials and documents containing trade secrets and copyrighted materials, including all copies and excerpts of the same.

          10.4 In the event of a breach of this Section 10, Owens agrees to pay PFC upon demand, without proof of actual damages, the sum total of all payments made pursuant to this Agreement, and agrees to pay PFC’s attorneys’ fees and costs incurred in any action brought to enforce the terms of, or establish a breach of this Section 10.

     11.  Denial of Liability. No provision of this Agreement shall be construed as an admission by Owens, PFC or the Released Parties of improper conduct, omissions, or liability.

     12.  Notice of Time for Reflection and Waiver. Owens acknowledges that this Agreement constitutes written notice from PFC that he should consult with an attorney before signing this Agreement, and he acknowledges that he has fully discussed all aspects of this Agreement with his attorney to the extent he desires to do so. Owens agrees that he has carefully read and fully understands all of the provisions of this Agreement and that he is voluntarily entering into this Agreement. Owens agrees that, as part of this Agreement, he has been provided with consideration in addition to anything of value to which Owens is already entitled. Owens acknowledges that he has been advised that, prior to waiving any claims he may have under the Age Discrimination in Employment Act, he may take up to twenty-one (21) calendar days to consider this Agreement before signing, and he may revoke this Agreement within seven (7) calendar days after he signs this Agreement. Owens agrees that if he wishes to revoke this Agreement, he or his counsel will notify PFC in writing, addressed to P.F. Chang’s China Bistro, Inc., 7676 E. Pinnacle Peak Road, Scottsdale, Arizona 85255, Attn: Nancy Mailhot, delivered on or before the expiration of the revocation period. In the event this Agreement is signed prior to the expiration of 21 calendar days, Owens acknowledges that he voluntarily and knowingly agrees to waive his entitlement to take 21 days to consider this Agreement for the purpose of expediting the settlement. This Agreement must be signed no later than January 24, 2009.

     13.  Effective Date. This Agreement is effective after full execution by all parties on or before January 24, 2009, and expiration of the seven-day revocation period outlined in Paragraph 12.

     14 Arbitration of Disputes . The parties agree to arbitrate any and all disputes arising out of or relating to the enforcement of this Separation Agreement, or for the breach hereof, or the interpretation hereof. The arbitration will be conducted in Scottsdale, Arizona by a single neutral arbitrator in accordance with the then current rules for resolution of employment disputes of the American Arbitration Association (available on-line at www.adr.org). The arbitrator shall have the power to enter any award that could be entered by a judge of a trial court of the State of Arizona, and only such power, and shall follow the law. The losing party will pay the cost of the arbitration, as well as the other party’s attorneys’ fees.

     15.  Choice of Law. This Agreement shall be construed, enforced, and governed by the laws of the State of Arizona.

     16.  Section 409A Compliance. It is intended that the payments and benefits under this Agreement comply with, or as applicable, constitute a short-term deferral or otherwise be exempt from, the provisions of Section 409A of the Internal Revenue Code of 1986, as amended and the regulations and other guidance promulgated thereunder (“Section 409A”). The Agreement will be administered and interpreted in a manner consistent with this intent, and any provision that would cause the Agreement to fail to satisfy Section 409A will have no force and effect until amended to comply therewith (which amendment may be retroactive to the extent permitted by Section 409A). Notwithstanding anything contained herein to the contrary, to the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A, Owens shall not be considered to have terminated employment with the Company for purposes of this Agreement and no payments shall be due to

Owens under this Agreement providing for payment of amounts on termination of employment unless Owens would be considered to have incurred a “separation from service” from the Company within the meaning of Section 409A. To the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A, amounts that would otherwise be payable and benefits that would otherwise be provided pursuant to this Agreement during the six-month period immediately following Owens’s termination of employment shall instead be paid on the first business day after the date that is six months following Owens’s termination of employment (or upon Owens’s death, if earlier). In addition, for purposes of this Agreement, each amount to be paid or benefit to be provided to Owens pursuant to the Agreement, which constitute deferred compensation subject to Section 409A, shall be construed as a separate identified payment for purposes of Section 409A. With respect to any expenses eligible for reimbursement under the terms of the Agreement, which constitute deferred compensation subject to Section 409A, (i) the amount of such expenses eligible for reimbursement in any taxable year shall not affect the expenses eligible for reimbursement in another taxable year and (ii) any reimbursements of such expenses shall be made within thirty (30) days following Owens’s submission of such expense for reimbursement to the Company, but in any case no later than the end of the calendar year following the calendar year in which the related expenses were incurred; provided , however that with respect to any reimbursements for any taxes to which Owens becomes entitled under this Agreement, if any, the payment of such reimbursements shall be made by the Company within thirty (30) days following a determination that a tax gross-up payment is due, but in no later than the end of the calendar year following the calendar year in which Owens remits the related taxes.

     17.  Severability. Should any provision of this Agreement be declared or determined by any Court to be illegal or invalid, the validity of the remaining parts, terms or provisions shall not be affected thereby and said illegal or invalid part, term or provision shall be deemed not to be a part of this Agreement.

[SIGNATURES ON FOLLOWING PAGE]

***WARNING DO NOT SIGN THIS AGREEMENT UNLESS YOU UNDERSTAND IT!
THIS AGREEMENT INCLUDES A WAIVER OF YOUR RIGHTS!***

     Subscribed and Sworn to before me by Russell Owens, known to me, on this 10 day of December, 2008.

EXHIBIT A

AMENDED AND RESTATED
EXECUTIVE EMPLOYMENT AGREEMENT

     This Amended and Restated Executive Employment Agreement (“Agreement”) is made, effective as of May 21, 2008 (“Effective Date”), by and between P.F. Chang’s China Bistro, Inc. (“Company”) and Russell Owens (“Executive”).

RECITALS

     WHEREAS, Executive and Company are parties to that certain Executive Employment Agreement dated August 6, 2002, as amended and restated effective June 30, 2005 (the “Prior Employment Agreement”); and

     WHEREAS, Executive and Company desire to amend and restate in its entirety the Prior Employment Agreement.

     NOW THEREFORE, the parties agree as follows:

     1.  Employment . Company hereby agrees to continue Executive’s employment, and Executive hereby accepts such employment, upon the terms and conditions set forth herein.

     2.  Duties .

          2.1 Position . Executive is employed as Executive Vice President of Company and shall have the duties and responsibilities assigned by Company at the present date and as may be reasonably assigned from time to time. Executive shall perform faithfully and diligently all duties assigned to Executive. Company reserves the right to modify Executive’s position and duties at any time in its sole and absolute discretion, provided that the duties assigned are consistent with the position of a senior executive and that Executive continues to report directly to the Chief Executive Officer or the Board of Directors of Company.

          2.2 Best Efforts/Full-time . Executive will expend Executive’s best efforts on behalf of Company, and will abide by all policies and decisions made by Company, as well as all applicable federal, state and local laws, regulations or ordinances. Executive will act in the best interest of Company at all times. Executive shall devote Executive’s full business time and efforts to the performance of Executive’s assigned duties for Company, provided that Executive may continue to serve on the boards of directors of other companies so long as such service is in accordance with the Company’s policies governing such activities.

          2.3 Work Location . Executive’s principal place of work shall be located in Scottsdale, Arizona, or such other location as the parties may agree upon from time to time.

     3.  Term .

          3.1 Initial Term . The employment relationship pursuant to this Agreement shall be for an initial term commencing on the Effective Date set forth above and continuing for a period of three (3) years following such date (“Initial Term”), unless sooner terminated in accordance with section 7 below.

          3.2 Renewal . On completion of the Initial Term specified in subsection 3.1 above, this Agreement will automatically renew for subsequent one-year terms unless either party provides ninety (90) days’ advance written notice to the other that Company/Executive does not wish to renew the Agreement for a subsequent one-year term. In the event either party gives notice of nonrenewal pursuant to this subsection 3.2, this Agreement will expire at the end of the current term.

     4.  Compensation .

          4.1 Base Salary . As compensation for Executive’s performance of Executive’s duties hereunder, Company shall pay to Executive an initial Base Salary of $442,000 per year, payable in accordance with the normal payroll practices of Company, less required deductions for state and federal withholding tax, social security and all other employment taxes and payroll deductions.

          4.2 Incentive Compensation . Executive will be eligible to receive incentive