A hole is a chordless cycle with at least four vertices. A pan is a graph which consists of a hole and a single vertex with precisely one neighbor on the hole. An even hole is a hole with an even number of vertices. We prove that a (pan, even hole)-free graph can be decomposed by clique cutsets into essentially unit circular-arc graphs. This structure theorem is the basis of our $O(nm)$-time certifying algorithm for recognizing (pan, even hole)-free graphs and for our $O(n^{2.5}+nm)$-time algorithm to optimally color them. Using this structure theorem, we show that the tree-width of a (pan, even hole)-free graph is at most 1.5 times the clique number minus 1, and thus the chromatic number is at most 1.5 times the clique number.
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