Exhibit
10.1


 


SEPARATION AND RELEASE AGREEMENT


 


WHEREAS Cutter & Buck Inc. (“Cutter
& Buck”) has determined that William B. Swint (“Swint”) shall be relieved
of all his regular duties effective March 6, 2006, and that Cutter &
Buck will no longer employ Swint as of March 31, 2006;


 


AND WHEREAS Cutter & Buck and Swint
desire to settle and resolve all possible disputes between them arising out of
Swint’s employment and his separation from employment, and to memorialize their
agreement regarding certain post-termination obligations assumed by Swint.


 


THEREFORE, it is now agreed as follows:


 


1.                                      Confidentiality of
Agreement; Representation Regarding Conduct; Agreement Not Admission. The
parties agree to keep this Agreement confidential and not to disclose any information
contained in this Agreement, including the existence or substance of the
separation benefits provided to Swint, except to (i) Swint’s immediate
family, personal attorney and tax or financial advisor, (ii) within Cutter
& Buck’s management, (iii) as required by law, or (iv) as
Cutter & Buck deems appropriate to comply with its obligations with
federal or state securities laws, including, without limitation, any obligation
to file this document with the Securities and Exchange Commission. The parties
agree to inform each individual to whom disclosure is made under this paragraph
of the confidentiality provisions of this Agreement. Swint represents that he
has not knowingly participated in any wrongdoing, misrepresentation, or breach
of any duty to Cutter & Buck or to any shareholder, investor,
customer, vendor, employee or governmental regulator. This Agreement is not an
admission by either party to this Agreement that he or it (or any of its
employees or agents) has violated any law or failed to fulfill any duty to the
other party.


 


2.                                      Resignation of Position;
Termination of Employment. Swint hereby acknowledges that he
ceased to be the Vice President, Chief Operations Officer on March 6, 2006, and
that he has executed the form of resignation as Vice President, Chief
Operations Officer attached hereto as Exhibit A. Swint acknowledges
that upon receipt of his regular salary and benefits through March 31, 2006,
and any accrued and unused vacation pay through March 31, 2006, he will
have received all wages, bonuses, incentives, benefits or other compensation
due to him from Cutter & Buck, and that the Separation Benefits set
forth below are in excess of anything owed to him by Cutter & Buck.
Swint further specifically acknowledges that Cutter & Buck has granted to
him all leave rights to which he believes himself entitled and that his leave
rights under the Family and Medical Leave Act and other applicable laws and
Cutter & Buck’s policies have been fully respected and honored by Cutter
& Buck.


 


3.                                      Status of COBRA Rights
and Options. Except as set forth in Paragraph 4(e) below with respect to
COBRA, Swint’s rights under COBRA, Cutter & Buck’s Stock Option Plans,
and the Employee Stock Purchase Program shall be the same as any other
terminating employee. Accordingly, assuming Swint remains employed through
March 31, 2006, that shall be the date for determining COBRA eligibility and
for considering the degree to which Swint’s options have vested, as shown on Exhibit B
attached to this Agreement. Swint hereby 


 

















 


acknowledges that:  (i) he has no other options or rights to
purchase or acquire shares of Cutter & Buck stock except as set forth
in Exhibit B; and (ii) that said rights to purchase must be
exercised in accordance with the applicable plans and will expire ninety (90)
days after his termination date of March 31, 2006.


 


4.                                      Separation Benefits to
Swint. In consideration of Swint’s release set forth below, and
conditioned on his continuing compliance with the noncompetition and
nonsolicitation obligations assumed by him, as well as other performances by
Swint as set forth in this Agreement, and conditioned on Swint not revoking his
ADEA release, Cutter & Buck also agrees to provide Swint with the
following separation benefits, which Swint acknowledges are in excess of any
wages, benefits or other compensation due to him from Cutter & Buck as
follows:


 


(a)                                  For
the six (6) month period from April 1, 2006 through September 30, 2006,
Cutter & Buck shall pay Swint severance payments in an amount equal to
his monthly base salary as was in effect on March 31, 2006, less all lawful
deductions. These payments shall be subject to Swint’s compliance with this
Agreement and shall be made in accordance with Cutter & Buck’s
established payroll practices.


 


(b)                                 Notwithstanding
the termination of Swint’s employment as of March 31, 2006, Cutter & Buck
will reimburse Swint for his COBRA premium payments incurred through September
30, 2006, which are anticipated to be approximately $753.69 per month. Cutter
& Buck will provide Swint with reimbursement pursuant to this paragraph
within five (5) business days of Swint submitting documentation of such
payments to Cutter & Buck.


 


(c)                                  Within
five (5) business days of the effective date of this Agreement, Cutter &
Buck will pay Swint the sum of $5,000 for his use in obtaining outplacement and
career counseling services.


 


Cutter & Buck further agrees not to
oppose Swint’s application for unemployment insurance benefits.


 


5.                                      Releases.


 


(a)                                  Swint’s
Release. In exchange for the separation benefits provided for herein, and
except for the obligations assumed by Cutter & Buck herein, Swint
individually and on behalf of any marital community, releases and forever
discharges Cutter & Buck, its successors and assigns, along with all
of its directors, trustees, officers, shareholders, employees, corporate
affiliates, attorneys or agents from any and all claims, demands or causes of
action of any nature whatsoever, whether known or unknown, arising from or in
any way connected with Swint’s status as an employee, officer or other
relationship with Cutter & Buck, whether based in tort, contract, or
any federal, state or local law, statute or regulation. Swint specifically
releases any and all rights he might have or assert to a claim for any bonus or
payment under any incentive compensation plan previously adopted by
Cutter & Buck or otherwise and specifically releases any and all
rights he might have or assert under that certain change in control agreement
dated on or about May 14, 2003 (attached hereto as Exhibit C),
which agreement is hereby terminated by agreement of the parties. The parties
represent and warrant that no promise or inducement has been offered except as
set forth in this agreement; that this agreement is executed without 


 


2

















 


reliance upon any statement or representation
by either party to the other regarding the nature and extent of any liability
of one to the other. Except as expressly set forth herein, Swint specifically
understands that by executing this agreement, he is giving up any and all
rights and claims he may have against Cutter & Buck with respect to
events occurring on or before the execution of this agreement, including
unknown claims. Swint specifically understands that he is not entitled to any
other compensation, benefit or payment from Cutter & Buck other than
that expressly set forth in this agreement. Swint acknowledges that he has had an opportunity to consult with counsel
prior to signing this Agreement and that he signed this Agreement only after
full reflection and analysis. Specifically included in this release, but not by
way of limitation, is any claim for wrongful discharge, breach of contract,
defamation, mental distress, or employment discrimination, including but not
limited to claims arising under the Age Discrimination in Employment Act (“ADEA”),
Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991,
the Americans With Disabilities Act, the Family Medical Leave Act or the
Washington Law Against Discrimination, based on age, gender, disability or any
other protected category, as well as any claims under the Employee Retirement
Income Security Act of 1974 (“ERISA”). Swint warrants and agrees that he has
not and will not file any claim for damages, lawsuit or any other action
against Cutter & Buck, its Board of Directors, or any
Cutter & Buck officer or employee with respect to the foregoing, and
that he has not assigned any such claim or cause of action to any other person.


 


Notwithstanding
the foregoing, Swint reserves and retains any and all rights of indemnification
with respect to his prior position as an officer or employee of Cutter &
Buck, including any such right under Cutter & Buck’s Articles of
Incorporation, Bylaws or any insurance policy with respect thereto.


 


(b)                                 Cutter
& Buck’s Release. In exchange for Swint’s release and other performance
obligations assumed herein, Cutter & Buck, including its successors and
assigns, releases and forever discharges Swint from any and all claims, demands
or causes of action of any nature whatsoever, whether known or unknown, arising
from or in any way connected with Swint’s employment with Cutter & Buck,
whether based in tort, contract, or any federal, state or local law, statute or
regulation arising through the date of this Agreement. Notwithstanding the
foregoing, Cutter & Buck’s release of claims shall not extend to the
obligations assumed by Swint in this Agreement or any claim for damage arising
from any falsity in Swint’s representation in Section 1 of this Agreement.


 


6.                                      ADEA Release. Swint acknowledges that
he is knowingly and voluntarily waiving and releasing any rights that he may
have under the Age Discrimination in Employment Act (“ADEA”). Swint also
acknowledges that the consideration given for this Agreement is in addition to
anything of value to which he was already entitled. Swint further acknowledges
that he has been advised by this writing, as required by the ADEA, that
(a) this Agreement does not apply to any rights or claims that may arise
after the execution date of this Agreement; (b) Swint should consult with
an attorney prior to executing this Agreement; (c) Swint has twenty-one
(21) days to consider this Agreement (although he may choose to
voluntarily execute this Agreement earlier and to waive such period of
consideration); (d) Swint has seven (7) days following the execution
of this Agreement to revoke the Agreement by written notice to Theresa Treat,
Vice President and Manager of Human Resources; and (e) this Agreement will
not be 


 


3

















 


effective until the date upon which the
revocation period has expired, which will be the eighth day after this
Agreement is executed by Swint (“Effective Date”). Nothing in this Agreement
prevents or precludes Swint from challenging or seeking a determination in good
faith of the validity of this waiver under the ADEA, nor does it impose any
condition precedent, penalties or costs for doing so, unless specifically
authorized by federal law.


 


7.                                      Return of Company Property. Swint
represents that on or before March 31, 2006, he will have returned to
Cutter & Buck all property and equipment furnished to or prepared by
Swint or his subordinates in the course of or incident to his employment by
Cutter & Buck, including, without limitation, all books, manuals,
records, reports, notes, contracts, lists, and other documents or materials, or
copies thereof (including computer files), the master key, company credit card,
computer equipment, agreements, and all other proprietary information
belonging, or relating to the business of Cutter & Buck or any
affiliate. Swint’s obligation under this Agreement precludes him from keeping
any copies of Cutter & Buck’s property or documents without
Cutter & Buck’s express written permission for each such item of which
he wishes to retain a copy.


 


8.                                      Noncompetition/Nonsolicitation Obligations.
Swint agrees that, commencing on April 1, 2006, and continuing through
September 30, 2006, he will not in any capacity, directly or indirectly, engage
in, assist others to engage in or own a material interest in any business or
activity that is, or is preparing to be, in competition with
Cutter & Buck with respect to any product or service sold or
service provided by Cutter & Buck up to the time of Swint’s
termination of employment with Cutter & Buck in any geographical area
in which such product or service was sold or was actively engaged in on March
31, 2006, including, without limitation, any business or enterprise that
designs, sources, produces, markets or distributes men’s or women’s sportswear
which is sold through golf pro shops, resorts, corporate accounts, specialty
retail stores, international distributors or licensees. Swint further agrees
that, commencing on April 1, 2006, and continuing through September 30, 2006,
he will not, directly or indirectly, for himself or any other person or
entity:  (i) induce or attempt to
induce any employee, consultant, independent sales representative or
independent contractor of Cutter & Buck to leave the employ of or
terminate his, her or its contract with Cutter & Buck; (ii) in
any way interfere with the relationship between Cutter & Buck and any
employee, consultant, independent sales representative or independent contractor
of Cutter & Buck; (iii) reveal the name of (unless the name
is already a matter of public record), call on or otherwise solicit, accept
business or attempt to entice away from Cutter & Buck any actual or
identified potential customer of Cutter & Buck, nor will he assist
others in doing any prohibited act identified above.


 


9.                                      Other Performances Required of Swint. Swint
warrants and represents that he has not previously and will not in the future
disclose or use confidential information related to Cutter & Buck’s
customers, personnel, designs, pricing, marketing plans, budgets, strategies,
financial or other proprietary information that is not otherwise available to
the general public, including but not limited to information covered under the
Uniform Trade Secrets Act, RCW 19.108 et seq., and that he will at
all times continue to keep all such information confidential. Without limiting
the generality of the foregoing, Swint specifically reaffirms his obligations
under Sections 2, 3 and 4 of that certain Confidentiality and Noncompetition
Agreement executed by him on May 14, 2003 (the “Prior Noncompetition Agreement”),
a copy of which is 


 


4

















 


attached hereto as Exhibit D and
which provisions under Sections 2, 3 and 4 are incorporated herein by
this reference. Swint and Cutter & Buck further agree that they will not
disparage each other and that Swint will not disparage Cutter & Buck’s
officers, board members, directors, employees, customers or agents in any way
now or in the future. In an effort to ensure a smooth and efficient transition
of his duties, Swint agrees to make himself available on a reasonable basis to
meet and confer with management of Cutter & Buck during the period from
March 6, 2006 through March 31, 2006. Swint will cooperate with and
make himself available to Cutter & Buck and its counsel, with
regard to any dispute or litigation with any third party, provided that both
parties understand and agree to provide Swint with flexibility as to
scheduling, so as to protect against unreasonable interference with new
employment possibilities and/or responsibilities. Subject to a requirement for
Cutter & Buck’s prior authorization, Cutter & Buck shall reimburse
Swint for expenses reasonably and actually incurred in connection with his
cooperation under the preceding sentence.


 


10.                               Remedies. Swint acknowledges that the
obligations of noncompetition, nonsolicitation, confidentiality, and
nondisparagement are material parts of the consideration and inducement to
Cutter & Buck to provide the Separation Benefits set forth herein. Further,
the parties agree that the harm to Cutter & Buck from any breach of
Swint’s obligations under this Agreement may be wholly or partially
irreparable, and Swint agrees that such obligations may be enforced by
injunctive relief and other appropriate remedies, as well as by damages. If any
bond from Cutter & Buck is required in connection with such
enforcement, the parties agree that a reasonable value of such bond shall be
$5,000. Upon proof of a violation by Swint, any amounts received by Swint or by
any other through Swint in breach of this Agreement shall be deemed by the
court to be held in constructive trust for the benefit of Cutter &
Buck. Swint understands and acknowledges that the provisions of Paragraphs 8
and 9 are necessary and reasonable to protect Cutter & Buck in the
conduct of its business and that compliance with these paragraphs will not
prevent him from pursuing his livelihood. However, should any court find that
any provision of Paragraphs 8 or 9 is unreasonable, invalid or
unenforceable, whether in period of time or otherwise, then in that event the
parties hereby agree that Paragraphs 8 and 9 shall be interpreted and
enforced to the maximum extent which the court deems reasonable.


 


11.                               Assignment. Each party warrants that he
or it is the true party in interest and fully authorized to execute this
Agreement. Swint’s rights and duties hereunder are personal to him and are not
assignable to others, but Swint’s obligations hereunder will bind his heirs,
successors, and assigns. Cutter & Buck may assign its rights under
this Agreement, along with the assumption of its obligations hereunder, in
connection with any merger or consolidation of the Company or any sale of all
or any portion of the Company’s assets (including, without limitation, any
division or product line).


 


12.                               General. This Agreement contains the
entire understanding of the parties and constitutes the exclusive agreement
with respect to the subject matter hereof and supersedes all prior agreements
or understandings of the parties, except to the extent that Swint remains bound
with respect to those paragraphs of the Prior Noncompetition Agreement
specifically incorporated herein. No waiver of or forbearance to enforce any
right or provision hereof shall be binding unless in writing and signed by the
party to be bound, and no such waiver or forbearance in any instance shall
apply to any other instance or to any other right or provision.


 


5

















 


13.                               Jurisdiction. This Agreement will be
governed by the local laws of the State of Washington without regard to its
conflicts of laws rules to the contrary, except to the extent superseded by
federal law, including the ERISA. The parties hereby consent to the exclusive
jurisdiction and venue of the state and federal courts residing in King County,
Washington for all matters and actions arising under this Agreement. The
prevailing party shall be entitled to reasonable attorneys’ fees and costs
incurred in connection with such litigation. No term hereof shall be construed
to limit or supersede any other right or remedy of the Company under applicable
law with respect to the protection of trade secrets or otherwise. If any
provision of this Agreement is held to be invalid or unenforceable to any
extent in any context, it shall nevertheless be enforced to the fullest extent
allowed by law in that and other contexts, and the validity and force of the
remainder of this Agreement shall not be affected thereby.


 


14.                               Knowing and Voluntary Waiver. Swint
acknowledges that he has been advised to consult with an attorney, and has had
the opportunity to do so, before signing this Agreement, which Swint has been
given a reasonable period of time to consider.


 


PLEASE READ CAREFULLY. THIS IS A VOLUNTARY
AGREEMENT THAT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.


 


	
   

  	
   

  	
  CUTTER & BUCK INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
       /s/ William
  B. Swint

  	
   

  	
  By:

  	
       /s/ John T.
  Wyatt

  	
   

  
	
   

  	
  William B. Swint, individually and on

  	
   

  	
  John T. Wyatt

  	
   

  
	
   

  	
  behalf of any marital community

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
  Date: March 14, 2006

  	
  Date: March 6, 2006

  
						



 


6

















 


EXHIBIT A


 


March 14, 2006


 


To:                              The
Board of Directors of Cutter & Buck Inc.


 


The undersigned, Bill Swint, hereby resigns
as Vice President, Chief Operations Officer effective immediately, and as an
employee of Cutter & Buck effective March 31, 2006.


 


	
   

  	
       /s/ William
  B. Swint

  	
   

  
	
   

  	
  William B. Swint

  



 


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EXHIBIT B*


 


William B. Swint — Options Summary as of
March 31, 2006


 


	
  Grant Date

  	
   

  	
  Number

  	
   

  	
  Options Granted

  	
   

  	
  Exercise Price

  	
   

  	
  Amount Vested 

  and Exercisable 

  as of 3/31/06

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10/28/2005**

  	
   

  	
  00000867

  	
   

  	
  33,393

  	
   

  	
  $

  	
  4.09

  	
   

  	
  33,393

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total Amount Vested and Exercisable as of March 31, 2006:

  	
   

  	
  33,393

  	
   

  



 






*This
Exhibit B fairly and accurately reflects the status of options to the best
of the parties’ knowledge. The parties agree to conform this Exhibit B to
correct any inaccuracies or scrivener’s errors.


 


**In
connection with the special dividend adjustments, grant #0000867 dated
10/28/2005 was issued to replace grant 00000597 dated 06/16/03.


 


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EXHIBIT C


 


CHANGE IN CONTROL AGREEMENT


FOR


William Swint


 


This Agreement
is entered into this 14th day of May 2003 by and between
Cutter & Buck Inc. (the “Company”) and William Swint (“Executive”). Executive
is an at-will employee of the Company. The parties wish to provide Executive
with severance benefits if Executive’s employment is terminated in connection
with a change in control of the Company. The Company is willing to provide such
benefits if Executive enters into the Company’s form of Confidentiality and
Non-Competition Agreement for executive officers.


 


NOW,
THEREFORE, in consideration of the foregoing recitals and the covenants and
conditions contained herein, the parties hereby agree as follows:


 


1.                                       CHANGE
IN CONTROL.


 


(a)                                  If,
within the period commencing 90 days prior to the date of occurrence (the “Event
Date”) of a Control Event and ending on the date eighteen (18) months after the
Event Date (the “Window”), the Company terminates Executive’s employment (other
than for Cause) or Executive resigns for Good Reason, the Company shall pay to
Executive the Severance Payment in immediately available funds. If the
termination occurs prior to the Control Event, the Severance Payment is due on
the twentieth business day following the Event Date; if the termination occurs
on or subsequent to the Event Date, the Severance Payment is due on the
twentieth business day following the date of termination (the “Termination Date”).


 


(b)                                 The
Severance Payment shall be equal to 150% of Executive’s annual base salary as
of the Termination Date. If the Termination Date occurs during the Window but
prior to the Control Event, the Severance Payment shall be reduced by the sum
of any severance payments previously received by Executive from the Company
(but not below zero).


 


(c)                                  Each
of the following shall constitute a “Control Event”:


 


(1)                                  the
acquisition of Common Stock of the Company (the “Common Stock”) by any “Person”
(as such term is defined in the Rights Agreement dated as of November 20,
1998 between the Company and Mellon Investor Services LLC (the “Rights Plan”),
together with all Affiliates and Associates (as such terms are defined in the
Rights Plan) of such Person, such that such Person becomes, after the date of
this Agreement, the Beneficial Owner (as defined in the Rights Plan) of
twenty-five percent (25%) or more of the shares of Common Stock then
outstanding, but shall not include any such acquisition by (i) the Company,
(ii) any subsidiary of the Company, (iii) any employee or director of the
Company as of the date hereof, or (iv) any employee benefit plan of the Company
or of any subsidiary of the Company or any Person or entity organized,
appointed or established by the Company for or pursuant to the terms of any
such employee benefit plan; or


 


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(2)                                  the
consummation of any merger, consolidation, reorganization or other transaction
providing for the conversion or exchange of twenty-five percent (25%) or more
of the outstanding shares of Common Stock into securities of any Person, or
cash, or property, or a combination of any of the foregoing; or


 


(3)                                  the
consummation of any sale or other disposition of all or substantially all of
the assets of the Company; or


 


(4)                                  individuals
who, as of the date hereof, constitute the Company’s Board of Directors (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Company’s
Board of Directors; provided, however, that any individual becoming a director
subsequent to the date hereof whose election, or nomination for the election by
the Company’s shareholders, was approved by a vote of at least a majority of
the directors then comprising the Incumbent Board shall be considered as though
such individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest or other actual or
threatened solicitation of proxies or consents by or on behalf of a Person
other than the Board of Directors.


 


(d)                                 Each
of the following shall constitute “Good Reason”, provided that it occurs during
the Window:


 


(1)                                  the
material diminution of Executive’s position, duties, responsibilities or status
with the Company or its successor, as compared with the position, duties,
responsibilities or status of Executive with the Company immediately prior to
the Event Date, except in connection with the termination of Executive for
Cause;


 


(2)                                  the
Company’s assignment of Executive on a substantially full-time basis to work at
a location where the distance between the new location and Executive’s
principal residence is at least 20 miles greater than the distance between the
former location and such residence; provided, however, that this paragraph
shall not apply to travel in the furtherance of the Company’s business to an
extent substantially consistent with Executive’s business travel obligations as
of the date hereof;


 


(3)                                  the
Company’s failure to obtain an assumption of the obligations of the Company to
perform this Agreement by any successor to the Company;


 


(4)                                  any
reduction in Executive’s base salary, or a material reduction in benefits
payable to Executive or failure of the Company to pay Executive any earned
salary, bonus or benefits except with the prior written consent of Executive;


 


(5)                                  the
exclusion or limitation of Executive from participating in some form of
variable compensation plan which provides the Executive the opportunity to
achieve a level of total compensation (base salary plus variable compensation)
consistent with what the Executive had the opportunity to earn at the Event
Date; or


 


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(6)                                  any
demand by any director or officer of the Company that Executive take any action
or refrain from taking any action where such action or inaction, as the case
may be, would violate any law, rule, regulation or other governmental
pronouncement, court order, decree or judgment, or breach any agreement or
fiduciary duty.


 


(e)                                  Each
of the following shall constitute “Cause”:


 


(1)                                  any
violation by Executive of any material obligation under this Agreement or the
attached Confidentiality and Non-Disclosure Agreement;


 


(2)                                  conviction
for commitment of a felony;


 


(3)                                  any
violation of law which has a material adverse effect on the Company;


 


(4)                                  habitual
abuse of alcohol or a controlled substance under circumstances that adversely
affect the Executive’s performance of his or her duties in any way;


 


(5)                                  theft
or embezzlement from the Company;


 


(6)                                  repeated
unexcused absence from work;


 


(7)                                  Disability
of Executive (as defined below); and


 


(8)                                  repeated
failure or refusal by Executive to carry out the reasonable directives, orders
or resolutions of the Company’s Board of Directors or any officer to whom he or
she reports.


 


(f)                                    “Disability”
shall mean any physical, mental or other health condition which renders the
Executive unable to perform the essential functions of his or her position with
or without reasonable accommodation. Any disagreement as to whether Executive
is disabled shall be resolved by a physician selected by the Company after an
examination of Executive. Executive hereby consents to such physical
examination and to the examination of all medical records of Executive
necessary, in the judgment of the examining physician, to make the
determination of disability.


 


(g)                                 Notwithstanding
any other provision of this Agreement to the contrary, in the event that any
severance or other payment, benefit or right payable or accruing to Executive
hereunder or under any of the Company’s benefit plans (the “Benefit Plans”)
would constitute a “parachute payment” as defined in Section 280G(b)(2) of
the Internal Revenue Code of 1986, as amended (the “Code”), then the total
amount of severance and other payments or benefits payable to Executive
hereunder and under the Benefit Plans which is deemed to constitute a “parachute
payment” shall not exceed and shall, if necessary, be reduced to an amount (the
“Revised Severance Payment”) equal to 2.99 times Executive’s “base amount” as
defined in Code Section 280G(b)(3). In the event of a disagreement between
the Company and Executive 


 


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as to whether the provisions of Code
Section 280G are applicable or the amount of the Revised Severance
Payment, such determination shall be made by the Company’s independent public
accountants or, if such firm is unable or unwilling to render such a
determination, then by a law firm mutually acceptable to Executive and the
Company. All costs relating to such determination shall be borne by the Company.
The Company and the Executive shall cooperate in good faith to make the
determination required by this Section 1(g) by mutual agreement not later
than the later of:  (i) the fifth
day preceding the date that the Severance Payment is or would be due or
(ii) the earlier of (x) the tenth day following the expiration of any
period of accelerated vesting of options to purchase the Company’s Common Stock
provided by Section 5(n) of the Benefit Plan or (y) the tenth day
following the date of exercise by Executive of his or her last remaining option
which was exercisable solely due to the application of Section 5(n) of the
Benefit Plan. Pending the final calculation of the Severance Payment or Revised
Severance Payment, the Company shall pay the amounts described under
subsection (b) above at the time and in the manner provided herein;
provided that, pending such determination, such payments shall be reduced by
such amounts as the Company estimates in good faith to be necessary to satisfy
its tax (including excise tax) withholding obligations and effect the reduction
in the amount of the Severance Payment, as contemplated by this
subsection 1(g). The aggregate amount of any compensation actually paid or
provided to Executive under the terms of this Agreement and in excess of the
Revised Severance Payment shall be deemed, to the extent of such excess, a loan
to Executive payable upon demand and bearing interest at the rate of 8% per
annum.


 


2.                                       CONFIDENTIALLY
AND NON-COMPETITION AGREEMENT. In consideration of the obligations undertaken
by the Company pursuant to this Agreement, contemporaneously with the execution
of this Agreement, Executive and the Company shall enter into the form of
Confidentiality and Non-Competition Agreement attached hereto as EXHIBIT A
and each agreement shall be effective only if both agreements have been
executed.


 


3.                                       TERM
OF AGREEMENT. The Company’s obligations under Section 1 of this Agreement
shall expire with respect to Control Events occurring on or after the second
anniversary of the date of this Agreement (“Initial Expiration Date”), provided
however, that such obligations shall automatically extend for one (1) year on
each anniversary of the Initial Expiration Date unless terminated by the
Company effective as of the last day of the then current one (1) year extension
by written notice to that effect delivered to the Executive not fewer than
ninety (90) days prior to such anniversary of the Expiration Date.


 


4.                                       AT
WILL EMPLOYMENT. Unless and to the extent otherwise agreed by the Company and
Executive in a separate written employment agreement, Executive’s employment
shall be “at will”, with either party permitted to terminate the employment at
any time, with or without cause. No term of any employment agreement between
the Company and Executive shall be construed to conflict with, lessen or expand
the obligations of the parties under this Agreement.


 


5.                                       NOTICES.
All notices and other communications called for or required by this Agreement
shall be in writing and shall be addressed to the parties at their respective
addresses stated below or to such other address as a party may subsequently
specify by written notice and 


 


12

















 


shall be deemed to have been received
(i) upon delivery in person, (ii) five days after mailing it by U.S. certified
or registered mail, return receipt requested and postage prepaid, or
(iii) two days after depositing it with a commercial overnight carrier
which provides written verification of delivery:


 


	
  To the Company:

  	
  701 N. 34th Street, Suite 400

  
	
   

  	
  Seattle, Washington 98103

  
	
   

  	
  Attention: Chief Executive Officer

  
	
   

  	
   

  
	
  To Executive:

  	
  William Swint

  
	
   

  	
  Hotel Nettleton Apartments

  
	
   

  	
  1000 8th Avenue

  
	
   

  	
  Seattle, WA 98104-1201

  



 


6.                                       WITHHOLDING.
Except as described in subsection 1(g) of this Agreement, all payments due
to and all benefits to be provided to Executive hereunder shall be subject to
reduction for any applicable withholding taxes, including excise taxes.


 


7.                                       ASSIGNMENT.
Executive’s rights and duties hereunder are personal to Executive and are not
assignable to others, but Executive’s obligations hereunder will bind his
heirs, successors, and assigns. The Company may assign its rights under this
Agreement in connection with any merger or consolidation of the Company or any
sale of all or any portion of the Company’s assets (including, without
limitation, any division or product line), provided that any such successor or
assignee expressly assumes in writing the Company’s obligations hereunder.


 


8.                                       NO
DUTY TO MITIGATE. Executive shall not be required to mitigate the amount of any
payment made or benefit provided hereunder. The Company may offset any payment
due hereunder by the amount of damages to the Company resulting from any breach
of this Agreement by Executive.


 


9.                                       GENERAL.
This Agreement constitutes the exclusive agreement of the parties with respect
to the subject matter hereof and supersedes all prior agreements or
understandings of the parties. No waiver of or forbearance to enforce any right
or provision hereof shall be binding unless in writing and signed by the party
to be bound, and no such waiver or forbearance in any instance shall apply to
any other instance or to any other right or provision. This Agreement will be
governed by the local laws of the State of Washington without regard to its
conflicts of laws rules to the contrary. The parties hereby consent to the
exclusive jurisdiction and venue of the state and federal courts sitting in
King County, Washington for all matters and actions arising under this Agreement.
The prevailing party shall be entitled to reasonable attorneys’ fees and costs
incurred in connection with such litigation. No term hereof shall be construed
to limit or supersede any other right or remedy of the Company under applicable
law with respect to the protection of trade secrets or otherwise. If any
provision of this Agreement is held to be invalid or unenforceable to any
extent in any context, it shall nevertheless be enforced to the fullest extent
allowed by law in that and other contexts, and the validity and force of the
remainder of this Agreement shall not be affected thereby.


 


13

















 


IN WITNESS
WHEREOF, the parties have caused this Agreement to be signed as of the date
first above written.


 


	
  CUTTER & BUCK INC.

  	
  EXECUTIVE:

  
	
   

  	
   

  
	
   

  	
   

  
	
  By: 

  	
       /s/ Frances
  M. Conley

  	
   

  	
  Signature 

  	
       /s/ William
  B. Swint

  	
   

  
	
   

  	
  Frances M. Conley

  	
  Printed Name: 

  	
  William B. Swint

  	
   

  
	
  Its: 

  	
  Chief Executive Officer

  	
   

  
								



 


14

















 


EXHIBIT D


 


CONFIDENTIALITY AND NON-COMPETITION AGREEMENT


FOR


William Swint


 


This Agreement
is entered into this 14th day of May 2003 by and between Cutter
& Buck Inc. (the “Company”) and William Swint (“Executive”). Executive is
an at-will employee of the Company. In consideration of entering into an
agreement to provide Executive with severance benefits if Executive’s
employment is terminated in connection with a change in control in the Company,
Executive promises, on the terms set forth herein, at all times to protect the
Company’s proprietary information and to not compete with the Company following
termination of Executive’s employment in connection with a change in control.


 


NOW,
THEREFORE, in consideration of the foregoing recitals and the covenants and
conditions contained herein, the parties hereby agree as follows:


 


1.                                       Non-competition and Non-solicitation.


 


(a)                                  Executive
agrees that during the term of Executive’s employment with the Company and,
subject to receipt of the Severance Payment (as defined below) by the
Executive, until the first anniversary of the Termination Date (as defined
below), Executive will not in any capacity directly or indirectly engage in,
assist others to engage in or own a material interest in any business or
activity that is, or is preparing to be, in competition with the Company with
respect to any product or service sold or service provided by the Company up to
the time of termination of employment in any geographical area in which at the
time of termination of employment such product or service is sold or is
actively engaged in. For the purposes of this Agreement, the terms “Severance
Payment” and “Termination Date” shall have the meanings assigned to them in the
Change in Control Agreement (as defined in Section 6 below).


 


(b)                                 Executive
further agrees that during the period stated above, he/she will not directly or
indirectly call on, reveal the name of, or otherwise solicit, accept business
from or attempt to entice away from the Company any actual or identified
potential customer of the Company, nor will he/she assist others in doing so. Executive
further agrees that he/she will not, during the period stated above, encourage
or solicit any other employee or consultant of the Company to leave such
employment for any reason, nor will he/she assist others to do so.


 


(c)                                  Executive
acknowledges that the covenants in this Section 1 are necessary and
reasonable to protect the Company in the conduct of its business and that
compliance with such covenants will not prevent him/her from pursuing his/her
livelihood. However, should any court find that any provision of such covenants
is unreasonable, invalid or unenforceable, whether in period of time,
geographical area, or otherwise, then in that event the parties hereby agree
that such covenants shall be interpreted and enforced to the maximum extent
which the court deems reasonable.


 


15

















 


2.                                       Trade
Secrets and Confidential Information.


 


(a)                                  Executive
acknowledges that the Company’s business and future success depend upon the
preservation of the trade secrets and other confidential information of the
Company and its suppliers and customers (the “Secrets”). The Secrets may
include, without limitation, existing and to-be-developed or acquired product designs,
new product plans or ideas, market surveys, the identities of past, present or
potential customers, business and financial information, pricing methods or
data, terms of contracts with present or past customers, proposals or bids,
marketing plans, personnel information, procedural and technical manuals and
practices, servicing routines, and parts and supplier lists proprietary to the
Company or its customers or suppliers, and any other sorts of items or
information of the Company or its customers or suppliers which are not
generally known to the public at large. Executive agrees to protect and to
preserve as confidential during and after the term of his employment all of the
Secrets at any time known to Executive or in his/her possession or control (whether
wholly or partially developed by Executive or provided to Executive, and
whether embodied in a tangible medium or merely remembered).


 


(b)                                 Executive
shall mark all items containing any of the Secrets with prominent
confidentiality notices acceptable to the Company. Executive shall neither use
nor allow any other person to use any of the Secrets in any way, except for the
benefit of the Company and as directed by Executive’s supervisor. All material
containing or disclosing any portion of the Secrets shall be and remain the
property of the Company, shall not be removed from the Company’s premises
without specific consent from an officer of the Company, and shall be returned
to the Company upon the termination of Executive’s employment or the earlier request
of Executive’s supervisor. At such time, Executive shall also assemble all
materials in his possession or control which contain any of the Secrets, and
promptly deliver such items to the Company.


 


3.                                       Intellectual
Properties.


 


(a)                                  All
ownership, copyright, patent, trade secrecy and other rights in all works,
designs, inventions, ideas, manuals, improvements, discoveries, processes,
customer lists or other properties (the “Intellectual Properties”) made or
conceived by Executive during the term of his/her employment by the Company
shall be the rights and property solely of the Company, whether developed
independently by Executive or jointly with others, and whether or not developed
or conceived during regular working hours or at the Company’s facilities, and
whether or not the Company uses, registers, or markets the same.


 


(b)                                 In
accordance with the Company’s policy and RCW 49.44.140 and RCW 49.44.150, this
Agreement (other than Subsection 3(c)) does not apply to, and Executive
has no obligation to assign to the Company, any invention for which no Company
trade secrets and no equipment, supplies, services, or facilities of the
Company were used and which was developed entirely on Executive’s own time,
unless: (i) the invention relates directly to the business of the Company, (ii)
the invention relates to actual or demonstrably anticipated research or
development work of the Company, or (iii) the invention results from any work
performed by Executive for the Company.


 


16

















 


(c)                                  If
and to the extent that Executive makes use, in the course of his employment, of
any items or Intellectual Properties previously developed by Executive or
developed by Executive outside of the scope of this Agreement, Executive hereby
grants the Company a nonexclusive, royalty-free, perpetual, irrevocable,
worldwide license (with right to sublicense) to make, use, sell, copy,
distribute, modify, and otherwise to practice and exploit any and all such
items and Intellectual Properties.


 


(d)                                 Executive
will assist the Company as reasonably requested during and after the term of
his employment to further evidence and perfect, and to enforce, the Company’s
rights in and ownership of the Intellectual Properties covered hereby,
including without limitation, the execution of additional instruments of
conveyance and assisting the Company with applications for patents or copyright
or other registrations.


 


4.                                       Authority
and Non-Infringement. Executive warrants that any and all items,
technology, and Intellectual Properties of any nature developed or provided by
Executive under this Agreement and in any way for or related to the Company
will be original to Executive and will not, as provided to the Company or when
used and exploited by the Company and its contractors and customers and its and
their successors and assigns, infringe in any respect on the rights or property
of Executive or any third party. Executive will not, without the prior written
approval of the Company, use any equipment, supplies, facilities, or
proprietary information of any other party. Executive warrants that Executive
is fully authorized to enter into employment with the Company and to perform
under this Agreement, without conflicting with any of Executive’s other
commitments, agreements, understandings or duties, whether to prior employers
or otherwise. Executive will indemnify the Company for all losses, claims, and
expenses (including reasonable attorneys’ fees) arising from any breach of by
him/her of this Agreement.


 


5.                                       Remedies.
The harm to the Company from any breach of Executive’s obligations under this
Agreement may be wholly or partially irreparable, and Executive agrees that
such obligations may be enforced by injunctive relief and other appropriate
remedies, as well as by damages. If any bond from the Company is required in
connection with such enforcement, the parties agree that a reasonable value of
such bond shall be $5,000. Any amounts received by Executive or by any other
through Executive in breach of this Agreement shall be held in constructive
trust for the benefit of the Company.


 


6.                                       Executive
Agreement. In consideration of the obligations undertaken by Executive
pursuant to this Agreement, contemporaneously with the execution of this
Agreement, Executive and the Company are entering into a Change in Control
Agreement (the “Change in Control Agreement”), and each agreement shall be
effective only if both agreements have been executed.


 


7.                                       At
Will Employment. Unless and to the extent otherwise agreed by the Company
and Executive in a separate written employment agreement, Executive’s
employment shall be “at will”, with either party permitted to terminate the
employment at any time, with or without 


 


17

















 


cause. No term of any employment agreement
between the Company and Executive shall be construed to conflict with or lessen
Executive’s obligations under this Agreement.


 


8.                                       Notices.
All notices and other communications called for or required by this Agreement
shall be in writing and shall be addressed to the parties at their respective
addresses stated below or to such other address as a party may subsequently
specify by written notice and shall be deemed to have been received (i) upon
delivery in person, (ii) five days after mailing it by U.S. certified or
registered mail, return receipt requested and postage prepaid, or (iii) two
days after depositing it with a commercial overnight carrier which provides
written verification of delivery:


 


	
  To the
  Company:

  	
  701 N. 34th Street, Suite 400

  
	
   

  	
  Seattle, Washington 98103

  
	
   

  	
  Attention: Chief Executive Officer

  
	
   

  	
   

  
	
  To Executive:

  	
  William Swint

  
	
   

  	
  Hotel Nettleton Apartments

  
	
   

  	
  1000 8th Avenue

  
	
   

  	
  Seattle, WA 98104-1201

  



 


9.                                       Assignment.
Executive’s rights and duties hereunder are personal to Executive and are not
assignable to others, but Executive’s obligations hereunder will bind his/her
heirs, successors, and assigns. The Company may assign its rights under this
Agreement in connection with any merger or consolidation of the Company or any
sale of all or any portion of the Company’s assets (including, without
limitation, any division or product line), provided that any such successor or
assignee expressly assumes in writing the Company’s obligations under the
Executive Agreement.


 


10.                                 General.
This Agreement constitutes the exclusive agreement of the parties with respect
to the subject matter hereof and supersedes all prior agreements or
understandings of the parties. No waiver of or forbearance to enforce any right
or provision hereof shall be binding unless in writing and signed by the party
to be bound, and no such waiver or forbearance in any instance shall apply to
any other instance or to any other right or provision. This Agreement will be
governed by the local laws of the State of Washington without regard to its
conflicts of laws rules to the contrary. The parties hereby consent to the
exclusive jurisdiction and venue of the state and federal courts residing in
King County, Washington for all matters and actions arising under this Agreement.
The prevailing party shall be entitled to reasonable attorneys’ fees and costs
incurred in connection with such litigation. No term hereof shall be construed
to limit or supersede any other right or remedy of the Company under applicable
law with respect to the protection of trade secrets or otherwise. If any
provision of this Agreement is held to be invalid or unenforceable to any
extent in any context, it shall nevertheless be enforced to the fullest extent
allowed by law in that and other contexts, and the validity and force of the
remainder of this Agreement shall not be affected thereby.


 


18

















 


IN WITNESS
WHEREOF, the parties have caused this Agreement to be signed as of the date
first above written.


 


 


	
  CUTTER & BUCK INC.

  	
  EXECUTIVE:

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
       /s/ Frances
  M. Conley

  	
   

  	
  Signature 

  	
       /s/ William
  B. Swint

  	
   

  
	
   

  	
  Frances M. Conley

  	
  Printed Name

  	
  William B. Swint

  	
   

  
	
  Its: 

  	
  Chief Executive Officer

  	
   

  
								



 


19