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                                                                    EXHIBIT 10.1

                     SEVERANCE AGREEMENT AND GENERAL RELEASE


         THIS SEVERANCE AGREEMENT AND GENERAL RELEASE ("Agreement") is made and
entered into this 1st day of January, 2006, by and between STEVEN J. HISLOP
(hereinafter referred to as "Mr. Hislop") and O'CHARLEY'S INC. and its
subsidiaries and related entities (hereinafter collectively referred to as
"O'Charley's").

                              W I T N E S S E T H:

         WHEREAS, Mr. Hislop currently serves as Concept President-O'Charley's
and as a member of the Board of Directors of O'Charley's and has expressed his
desire to resign his position as a director and his employment, effective
January 1, 2006 (the "Effective Date");

         WHEREAS, O'Charley's has expressed its willingness to accept
Mr. Hislop's resignation as a director and from employment upon the following
terms and conditions; and

         WHEREAS, after a period of negotiations between them, the parties have
reached an agreement by which Mr. Hislop will resign as a director and his
employment on the Effective Date.

         NOW, THEREFORE, in consideration of the premises and mutual promises
herein contained, it is agreed as follows:

1.       The recitals set forth above are true and accurate, and by signing this
         Agreement, Mr. Hislop hereby resigns as a member of the Board of
         Directors and his employment effective January 1, 2006 (the "Effective
         Date"). Between the date of this Agreement and the Effective Date, Mr.
         Hislop will continue to serve at the direction of the Company's Chief
         Executive Officer. During such time, Mr. Hislop will continue to
         receive his base salary as currently in effect.

2.       This Agreement is not and shall not be construed as an admission by
         O'Charley's of any fact or conclusion of law. Without limiting the
         general nature of the previous sentence, this Agreement shall not be
         construed as an admission that O'Charley's, its subsidiaries, related
         entities, or any of its or their officers, directors, managers, agents,
         or employees have violated any law or regulation or have violated any
         contract, express or implied.

3.       Mr. Hislop represents and warrants that he has not filed any
         complaint(s) or charge(s) against O'Charley's with the Equal Employment
         Opportunity Commission or the state commission empowered to investigate
         claims of employment discrimination, the United States Department of
         Labor, the Office of Federal Contract Compliance Programs, or with any
         other local, state or federal agency or court, and that if any such
         agency or court assumes jurisdiction of any complaint(s) or charge(s)
         against O'Charley's on behalf of Mr. Hislop, Mr. Hislop will request
         such agency or court to withdraw from the matter, and Mr. Hislop will
         refuse any benefits derived therefrom. This Agreement will not affect
         Mr. Hislop's right to hereafter file a charge with or otherwise
         participate in an investigation or proceeding conducted by the Equal
         Employment Opportunity



<PAGE>

         Commission regarding matters which arose after the Effective Date and
         which are not the subject of this Agreement.

4.       Mr. Hislop represents and agrees that he is fully aware of his rights
         and is advised to discuss any and all aspects of this Agreement with
         his attorney, that Mr. Hislop has consulted with his attorney regarding
         this Agreement, or has chosen voluntarily not to do so, that he has
         carefully read and fully understands all of the provisions of this
         Agreement, and that, in consideration of the provisions hereof, Mr.
         Hislop agrees to enter into this Agreement. Mr. Hislop represents and
         acknowledges that prior to the execution of this Agreement, he has been
         provided a period of twenty-one (21) days within which to consider the
         Agreement.

5.       Mr. Hislop hereby irrevocably and unconditionally releases, acquits and
         forever discharges O'Charley's, its subsidiaries, and related entities,
         and each of their respective shareholders, successors, assigns, agents,
         directors, officers, employees, representatives, and attorneys, and all
         persons acting by, through, under or in concert with any of them
         (collectively, the "Released Parties"), or any of them, from any and
         all charges, complaints, claims, liabilities, obligations, promises,
         agreements, controversies, damages, actions, causes of action, suits,
         rights, demands, costs, losses, debts and expenses (including
         attorney's fees and costs actually incurred), of any nature whatsoever,
         known or unknown ("Claims"), which Mr. Hislop now has, owns, holds, or
         claims to have, own, or hold, or which Mr. Hislop at any time
         heretofore had, owned, or held, or claimed to have, own, or hold. Such
         Claims include those under local, state or federal law, Executive
         Order, or at common law including, but not limited to, the Age
         Discrimination in Employment Act (ADEA). This provision does not
         include the release of future charges before the Equal Employment
         Opportunity Commission regarding matters which arose after the
         Effective Date and which are not the subject of this Agreement. This
         provision further does not include the release of Claims with respect
         to any vested benefits under a plan governed by the Employee Retirement
         Income Security Act ("ERISA") or any Claim related to the rights and
         benefits granted by the express terms of this Agreement.

6.       Mr. Hislop agrees that he will not, without O'Charley's prior written
         consent, for a period ending on December 31, 2006, directly or
         indirectly, (i) solicit to hire or hire (or cause to leave the employ
         of O'Charley's) any salaried employee of O'Charley's or its
         subsidiaries or (ii) for himself or through, on behalf of or in
         conjunction with any person, persons or entity, own, consult with,
         maintain, operate, engage in, or have any financial or beneficial
         interest in (other than as a holder of not more than one percent of the
         outstanding stock of any corporation, which stock is publicly traded),
         advise, assist or make loans to, any business that is of a character
         and concept similar to the O'Charley's, Ninety-Nine Restaurant & Pub or
         Stoney River Legendary Steaks concepts operated by O'Charley's,
         including, without limitation, a full service varied menu casual dining
         restaurant which serves alcoholic beverages through a full-service bar,
         and which business is located within the United States. In the event
         Mr. Hislop desires to engage in any of the activities set forth in (i)
         or (ii) of this paragraph 6, he shall deliver to O'Charley's Inc.,
         Attn: President, his request in writing for O'Charley's consent,
         setting forth in detail the activity in which Mr. Hislop proposes to
         engage and will supply such



                                       2
<PAGE>

         other information as O'Charley's shall request in connection therewith.
         O'Charley's will consider such request and in determining whether to
         consent to any such request, O'Charley's will take into consideration
         the potential impact of such proposed activity on the business
         interests of O'Charley's. The agreements set forth in this paragraph 6,
         together with those contained in paragraph 7 are sometimes hereinafter
         collectively referred to as the "Restrictive Agreements."

7.       Mr. Hislop also recognizes that, as Concept President-O'Charley's he
         has had access to, was provided in detail with, and used throughout his
         employment with O'Charley's, certain confidential and proprietary
         business information. Such information includes but is not limited to
         business strategy, pricing information, branding strategy, budgets,
         site location, vendor information, market analysis and evaluation, and
         other such proprietary and confidential business information as defined
         under Tennessee law as a trade secret (hereinafter "Confidential and
         Proprietary Business Information"). Mr. Hislop agrees that, without
         O'Charley's prior written consent, he will not divulge, disclose,
         publish or disseminate in any manner, directly or indirectly, any such
         Confidential and Proprietary Business Information to any other person
         or entity.

8.       Mr. Hislop agrees that the Restrictive Agreements are reasonable and
         supported by adequate consideration, which but for his agreement
         herein, Mr. Hislop would not be entitled to receive. Mr. Hislop further
         agrees that the Restrictive Agreements are necessary for the protection
         of O'Charley's, its business and its employees, and properly balance
         his personal interest in future employment and the various interests
         related to O'Charley's, its business and its employees. Mr. Hislop
         further agrees that if he breaches any of the Restrictive Agreements,
         such breach likely will not have an adequate remedy at law and that
         O'Charley's shall be entitled, in addition to all other legal remedies
         available to it, to cease making the payments provided under paragraph
         9 and apply to and obtain from a court of competent jurisdiction an
         injunction against any violation thereof with the prevailing party
         entitled to recover all costs of such action, including reasonable
         attorneys' fees. These rights and remedies shall be cumulative and not
         alternative.

9.       Following the Effective Date, O'Charley's will provide to Mr. Hislop
         the following:

         (a)      The aggregate sum of $526,518.88, payable as follows: (i)
                  $426,907.20, payable weekly at the rate of $7,115.12
                  commencing on the Effective Date and (ii) $99,611.68, payable
                  in a lump sum on March 1, 2007, and from which payments
                  O'Charley's will make applicable legal withholdings.

         (b)      If Mr. Hislop elects to continue health insurance coverage
                  pursuant to his "COBRA" right after the Effective Date,
                  O'Charley's will pay the premiums for such coverage during the
                  twelve month period following the Effective Date ending
                  December 31, 2006.

10.      Attached as Schedule A is a listing of all stock options and restricted
         stock awards held by Mr. Hislop as of the Effective Date which are
         exercisable in whole or in part on the Effective Date. Mr. Hislop
         agrees that Schedule A accurately reflects all equity awards



                                       3
<PAGE>

         and their respective terms held by him as of the date hereof and which
         are exercisable in whole or in part on the Effective Date. All such
         awards were granted pursuant to the terms of the O'Charley's 2000 Stock
         Incentive or the O'Charley's 1990 Employee Stock Plan. Pursuant to such
         plans, upon the Effective Date, each of the stock options and
         restricted stock awards would automatically terminate; however,
         notwithstanding the provisions of such plans, O'Charley's agrees to
         extend until March 31, 2006 the time within which Mr. Hislop shall have
         the right to exercise any and all stock options listed on Schedule A to
         the extent they are exercisable as of the Effective Date (it being
         understood that all or any portion of any stock options, restricted
         stock awards or other equity based awards which are not exercisable or
         vested as of the Effective Date shall terminate as of such date in
         accordance with their terms).

11.      Mr. Hislop represents that he has not heretofore assigned or
         transferred, or purported to assign or transfer to any person or
         entity, any claim or any portion thereof or interest therein.

12.      Mr. Hislop represents and acknowledges that in executing this Agreement
         he does not rely and has not relied upon any other representation or
         statement made by any of the Released Parties or by any of the Released
         Parties' agents, representatives or attorneys, except as set forth
         herein, with regard to the subject matter, basis or effect of this
         Agreement.

13.      This Agreement shall be binding upon O'Charley's, Mr. Hislop and upon
         Mr. Hislop's heirs, administrators, representatives, executors,
         successors, and assigns, and shall inure to the benefit of the Released
         Parties and each of them, and to their heirs, administrators,
         representatives, executor, successors and assigns.

14.      This Agreement shall in all respects be interpreted, enforced and
         governed under the laws of the State of Tennessee. If either party
         files suit to enforce the terms of this Agreement, the prevailing party
         shall be entitled to its reasonable attorneys' fees and costs.

15.      Mr. Hislop shall have seven (7) days following the execution of this
         Agreement during which to revoke the Agreement. This Agreement shall
         become effective and irrevocable only after the seven (7) day period
         has expired and only absent a timely and effective revocation.

16.      Should any provision of this Agreement be declared or be 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.




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<PAGE>


17.      This Agreement sets forth the entire agreement between the parties
         hereto.


                                       O'CHARLEY'S INC.


                                       By:         /s/ Gregory L. Burns
                                          -------------------------------------
                                          Title: CEO
                                                 ------------------------------


                                       STEVEN J. HISLOP


                                                  /s/ Steven J. Hislop
                                       ----------------------------------------

                                       Date:      December 23, 2005
                                            -----------------------------------




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<PAGE>


                                   Schedule A


                              LIST OF EQUITY AWARDS


<Table>
<Caption>
                                                                                                   NUMBER OF
                                                                            SHARES SUBJECT          SHARES
                                        GRANT               EXERCISE         TO AWARD ON         EXERCISABLE ON
     TYPE OF AWARD                      DATE                  PRICE        EFFECTIVE DATE        EFFECTIVE DATE
---------------------------    ------------------------    ------------    ----------------     -----------------
<S>                            <C>                         <C>             <C>                  <C>
Stock Option                      February 18, 1998             $12.08          37,500                36,469
Stock Option                      February 17, 1999             $15.25          35,000                35,000
Stock Option                      February 15, 2000             $11.88          20,000                10,200
Stock Option                      February 19, 2003             $21.19          42,240                42,240
Restricted Stock Award            February 19, 2003                N/A          21,120                     0
Restricted Stock Award              May 12, 2004                   N/A          23,624                     0
Restricted Stock Award            January 21, 2005                 N/A          25,484                     0
</Table>