Exhibit 10.1
EXECUTIVE SEVERANCE
AGREEMENT
April 9, 2007
Emanuel N. Hilario
1495 Country Club Road
Lake Oswego, Oregon 97034
Executive
McCormick & Schmick’s
Seafood Restaurants, Inc.
720 SW Washington Street
Suite 550
Portland, OR 97205
Company
The Company considers the attraction
and retention of highly qualified management personnel to be
essential to promoting the best interests of the Company and its
shareholders. In this connection, the Company recognizes that, as
is the case of many publicly held corporations, the possibility of
a change of control exists and this possibility, and the
uncertainty and questions which it may raise among management, may
result in the departure or distraction of management personnel to
the detriment of the Company and its shareholders. To induce
Executive to remain employed by the Company in the face of
uncertainties about the long-term strategies of the Company and
possible change of control of the Company and their potential
impact on Executive’s position with the Company, this
Agreement, which has been approved by the Board of Directors of the
Company, sets forth the severance benefits that the Company will
provide to Executive if Executive’s employment by the Company
is terminated in the circumstances described in this
Agreement.
1. Employment Relationship .
Executive is currently employed by the Company as Chief Financial
Officer. Executive and the Company acknowledge that either party
may terminate this employment relationship at any time and for any
or no reason, subject to the obligation of the Company to provide
the severance benefits specified in this Agreement in accordance
with its terms.
2. Release of Claims . In
consideration for and as a condition precedent to receiving the
severance benefits outlined in this Agreement, Executive shall
execute a Release of Claims in the form attached as Exhibit A
(“Release of Claims”).
3. Compensation Upon
Termination . In the event of a Termination of
Executive’s Employment (as defined in Section 7.1) at
any time after April 12, 2007 other than for Cause (as defined
in Section 7.2), and contingent upon Executive’s
compliance with Section 9 and execution of the Release of
Claims and the expiration of the seven-day revocation period
provided by the Age Discrimination in Employment Act of 1967, as
amended by the Older Worker Benefit Protection Act of 1990, without
revocation of the Release of Claims by Executive, the Company shall
pay or provide the following to Executive:
3.1 As severance pay and in lieu of
any other compensation for periods subsequent to the date of
termination, the Company shall pay Executive, in a single payment
within ten days after the date of
termination, an amount in cash equal to
(a) one year of Executive’s annual base pay at the rate
in effect immediately prior to the date of termination plus
(b) the annual average of the amount paid to Executive under
all annual cash incentive plans during the prior two full years
ending prior to the date of termination.
3.2 The Company shall pay Executive
a lump sum payment in an amount equivalent to the reasonably
estimated cost Executive may incur to extend for a period of
six months under the COBRA continuation laws Executive’s
group health and dental plan coverage in effect at the time of
termination. Executive may use this payment for such continuation
coverage or for any other purpose.
3.3 The Company shall pay Executive
a portion of the benefits under all annual cash incentive plans in
effect at the time of termination equal to the estimated amount
payable under such plans for the full year (based on performance or
results to the date of termination) prorated for the portion of the
plan year during which Executive was a participant. For purposes of
this Agreement, Executive’s participation in any such plan
will be considered to have ended on Executive’s date of
termination. In making the proration calculation, the amount of
Executive’s award if Executive had been a participant for the
full incentive period shall be divided by the total number of days
in the incentive period and the result multiplied by the actual
number of days Executive participated in the plan. The Company
shall pay such amount within 10 days after the date of
termination.
3.4 If Executive’s employment
with the Company terminates for any reason prior to a Change of
Control (as defined in Section 7.3), other than at the
direction of a person who has entered into an agreement with the
Company the consummation of which will constitute a Change of
Control, Executive shall not be entitled to benefits under
Section 4.
4. Compensation Upon Termination
Following A Change of Control. In the event of a Termination of
Executive’s Employment other than for Cause within
12 months following a Change of Control, or prior to a Change
of Control at the direction of a person who has entered into an
agreement with the Company, the consummation of which will
constitute a Change of Control, and contingent upon
Executive’s compliance with Section 9 and execution of
the Release of Claims and the expiration of the seven-day
revocation period provided by the Age Discrimination in Employment
Act of 1967, as amended by the Older Worker Benefit Protection Act
of 1990, without revocation of the Release of Claims by Executive,
the Company shall pay or provide the following to
Executive:
4.1 As severance pay and in lieu of
any other compensation for periods subsequent to the date of
termination, the Company shall pay Executive, in a single payment
within ten days after the date of termination, an amount in cash
equal to (a) one year of Executive’s annual base pay at
the rate in effect immediately prior to the date of termination
plus (b) the annual average of the amount paid to Executive
under all annual cash incentive plans during the prior two full
years ending prior to the date of termination.
4.2 The Company shall pay Executive
a lump sum payment in an amount equivalent to the reasonably
estimated cost Executive may incur to extend for a period of
six months under the COBRA continuation laws Executive’s
group health and dental plan coverage in effect at the time of
termination. Executive may use this payment for such continuation
coverage or for any other purpose.
4.3 The Company shall pay Executive
a portion of the benefits under all annual cash incentive plans in
effect at the time of termination equal to the estimated amount
payable under such plans for
the full year (based on performance or results
to the date of termination) prorated for the portion of the plan
year during which Executive was a participant. For purposes of this
Agreement, Executive’s participation in any such plan will be
considered to have ended on Executive’s date of termination.
In making the proration calculation, the amount of
Executive’s award if Executive had been a participant for the
full incentive period shall be divided by the total number of days
in the incentive period and the result multiplied by the actual
number of days Executive participated in the plan. The Company
shall pay such amount within 10 days after the date of
termination.
4.4 All outstanding stock options
held by Executive under all stock option and stock incentive plans
of
