Exhibit 10.1



SEPARATION AGREEMENT



        THIS
SEPARATION AGREEMENT is made and entered into as of this 2nd day of March, 2005 by and
between William H. Baumhauer (the “Executive”), and Champps Entertainment, Inc.,
a Delaware corporation (the “Company”). 



        W I T N E S S T H: 



        WHEREAS,
the Executive has been employed by the Company as its President and Chief Executive
Officer; and 



        WHEREAS,
on March 2, 2005 the Executive ceased to be the President and Chief Executive Officer of
the Company, ceased all other officer and employee positions with the Company and its
subsidiaries, and has agreed to resign his membership on the boards of directors of the
Company and its subsidiaries and affiliates; and 



        WHEREAS,
the Executive and the Company desire to settle fully and finally all matters between them
to date, including, but in no way limited to, any issues that might arise out of the
Executive’s employment or the termination of his employment; 



        NOW,
THEREFORE, in consideration of the mutual covenants and promises contained herein, the
parties hereto, intending to be legally bound hereby, agree as follows: 



             1.       
          Employment Agreement. The Executive and the Company agree
          that the Executive’s termination of employment shall constitute a
          termination without “cause” as provided in section 9(b) of the
          Executive’s employment agreement dated as of May 22, 2003 (the
          “Employment Agreement”), and this Agreement shall constitute a Notice
          of Termination for purposes of section 11(b) of the Employment Agreement. Except
          as provided in this Agreement, all payments or other benefits to the Executive
          may be or become entitled and all continuing obligations to which the Executive
          will be subject on account of his termination of employment will be determined
          in accordance with the terms of the Employment Agreement. 



             2.       
          Announcement. The parties agree that any announcement by
          the Company with respect to the termination of the Executive’s employment
          will be provided to the Executive prior to its issuance or publication. 



             3.       
          Additional Agreements of the Executive and the Company.
          Unless otherwise required by a court of competent jurisdiction or pursuant to
          any recognized subpoena power or as is reasonably necessary in connection with
          any adversarial process between the Executive and a Company, the Executive
          agrees and promises that he will not make any oral or written statements or
          reveal any information to any person, company, or agency which are construed to
          be negative, disparaging or damaging to the reputation or business of the
          Company, its subsidiaries, directors, officers or affiliates, or which would
          interfere in any way with the business relations between that Company or any of
          its subsidiaries or affiliates and any of their customers or potential
          customers. Unless otherwise required by a court of competent jurisdiction or
          pursuant to any recognized subpoena power or as is reasonably necessary in
          connection with any adversarial process between the Executive and the Company,
          the Company agrees and promises that it will not make any oral or written
          statements or reveal any information to any person, company, or agency which are
          construed to be negative, disparaging or damaging to the reputation of the
          Executive. 



        In
addition, the Executive agrees, upon the execution of this Agreement, to tender his
resignation from the board of directors (and any committees thereof) of the Company and
from the board of directors of any subsidiary or affiliate of the Company. 



             4.       
          Additional Payments; Releases. If the Board of Directors of the
          Company (the “Board”), in its discretion, determines on or about
          September 30, 2005 that (i) the Executive has cooperated fully with the Board
          and the new chief executive officer of the Company in the transition of his
          responsibilities to the new chief executive officer and (ii) no material adverse
          information has been discovered after March 1, 2005 with respect to the Company
          or the businesses of the Company which is attributable in substantial part to
          actions taken or not taken prior to March 1, 2005, the Executive shall be
          entitled to receive his Base Salary (as defined in the Employment Agreement) for
          an additional four months after payments under the Employment Agreement would
          otherwise cease; provided, however, that any payments to the
          Executive otherwise scheduled to be paid after March 15, 2006 will be
          accelerated to the extent necessary to avoid the imposition of a tax under
          Section 409A of the Internal Revenue Code of 1986, as amended. 



        In
consideration of the payments to be received by the Executive under this Section 4 and for
other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the Executive, the Executive, upon receipt of a written statement from the
Board that the Company will make the payments described above, will provide a release to
the Company in the form attached as Exhibit A. In consideration of the Executive’s
execution of such a release and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the Company, the Company, upon receipt of
the release from the Executive, will provide a release to the Executive in the form
attached as Exhibit B. 



             5.       
          Scope of Agreement; Enforceability. This Agreement
          constitutes the entire understanding and agreement between the Company and the
          Executive with regard to all matters herein and supersedes all prior oral and
          written agreements and understandings of the parties with respect to such
          matters, whether express or implied, other than the Employment Agreement and the
          stock option agreements. 



        This
Agreement shall inure to the benefit of and be enforceable by the Executive’s heirs,
beneficiaries and/or legal representatives. This Agreement shall inure to the benefit of
and be binding upon the Company and its respective successors and assigns. 



        The
invalidity or unenforceability of a particular provision of this Agreement shall not
affect the enforceability of any other provisions hereof and this Agreement shall be
construed in all respects as if such invalid or unenforceable provisions were omitted. 



             6.       
          Amendments/Waiver. This Agreement may not be amended,
          waived, or modified otherwise than by a written agreement executed by the
          parties to this Agreement or their respective successors and legal
          representatives. No waiver by any party to this Agreement of any breach of any
          term, provision or condition of this Agreement by the other party shall be
          deemed a waiver of a similar or dissimilar condition or provision at the same
          time, or any prior or subsequent time. 



             7.       
          Colorado Law. This Agreement shall be construed and
          enforced in accordance with the laws of the State of Colorado without reference
          to its choice of law provisions. 



             8.       
          Counterparts. This Agreement may be executed in several
          counterparts, each of which shall be deemed to be an original, but all of which
          together shall constitute one and the same instrument. 



        IN
WITNESS WHEREOF, the Company and the Executive have caused this Agreement to be executed
as of the date first above written. 


CHAMPPS ENTERTAINMENT, INC. 


By:/s/ Donna Depoian

      Name: Donna Depoian

      Title: VP of Legal Counsel

  


By:/s/  William H. Baumhauer

      Name: William H. Baumhauer  


3







Exhibit A 


FORM OF RELEASE
AGREEMENT 



        I,
William H. Baumhauer, have agreed to execute and be bound by this Release in exchange for
the determination by the Board of Directors of Champps Entertainment, Inc. (the
“Company”) to pay the additional severance payments described in Section 4 of my
Separation Agreement with the Company, dated as of March 2, 2005 (the “Separation
Agreement”) with respect to the termination of my employment with the Company
effective as of March 2, 2005 and upon the end of the transition period ending on
September 30, 2005. I understand that my eligibility for the additional payments under
Section 4 of the Separation Agreement is expressly contingent upon my executing,
delivering and not revoking this Release. Under the terms of this Release, I am waiving
any rights to bring claims against the Company and any affiliates thereto and against
various other persons with respect to my employment, the cessation of my employment or
otherwise, except as specifically and expressly allowed by this Release. This is a legally
binding document. 



             1.    
          In exchange for the agreement of the Company to make the payments described in
          Section 4 of the Separation Agreement, I hereby release the Company and all of
          its past and/or present subsidiaries, divisions and affiliates, and their
          officers, directors, stockholders, partners, trustees, employees, agents,
          representatives, administrators, attorneys, insurers, fiduciaries, successors
          and assigns, in their individual and/or representative capacities (collectively
          referred to as “the Releasees”), from any and all causes of action,
          suits, agreements, promises, damages, disputes, controversies, contentions,
          differences, judgments, claims and demands of any kind whatsoever
          (“Claims”) that I or my heirs, executors, administrators, successors
          and assigns ever had, now have or may have against the Releasees, whether known
          or unknown to me, by reason of my employment and/or the cessation of my
          employment with the Company, or otherwise involving facts that occurred on or
          prior to the date that I have signed this Release, including, without
          limitation, any and all Claims arising under Title VII of the Civil Rights Act
          of 1964, the Age Discrimination in Employment Act of 1967 (including the Older
          Workers Benefit Protection Act), the Civil Rights Acts of 1866 and 1871, the
          Civil Rights Act of 1991, the Fair Labor Standards Act, the Equal Pay Act, the
          Employee Retirement Income Security Act of 1974, the Americans with Disabilities
          Act, the Family and Medical Leave Act of 1993, the New York State and New York
          City Human Rights Laws, the New York Labor Laws or comparable Colorado laws, to
          the extent applicable, and any and all other federal, state or local laws,
          statutes, rules and regulations pertaining to employment, as well as any and all
          Claims under federal and state contract or tort law. However, I am not releasing
          any Claims (i) for the benefits described in my Employment Agreement with the
          Company, dated as of May 22, 2003 (the “Employment Agreement”) or in
          the Separation Agreement, (ii) regarding any right I may have under any benefit
          plan or program maintained by the Company, (iii) regarding any rights for
          indemnification I may have under the Employment Agreement, (iv) regarding any
          rights I may have under any directors’ and officers’ insurance
          policies maintained by the Company or (v) regarding any rights that I may have
          under any stock option agreements with the Company (collectively, the
          “Excluded Claims”). 


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             2.    
          I represent that I have not filed, and will not hereafter file, any lawsuit
          against the Releasees relating to my employment and/or cessation of employment
          with the Company, or otherwise involving facts that occurred on or prior to the
          date that I have signed this Release, other than with respect to any Excluded
          Claims. 



             3.    
          I understand and agree that if I commence, continue, join in, or in any other
          manner attempt to assert any Claim (other than with respect to any Excluded
          Claims) released herein against the Releasees, or otherwise violate the terms of
          this Release, I agree to reimburse the Releasees for all attorneys’ fees
          and expenses incurred by any of them in defending against such a lawsuit,
          provided that the right of the Releasees to receive the foregoing payments is
          without prejudice to their other rights hereunder, including any waiver and
          release of any and all Claims (other than the Excluded Claims) against the
          Releasees. 



             4.    
          I understand and agree that the Company’s payments to me and my signing of
          this Release do not in any way indicate that I have any viable Claims against
          the Releasees or that any of the Releasees admits any liability to me
          whatsoever. 



             5.    
          I agree to keep the terms of this Release in strict confidence, except where
          necessary to comply with or enforce this Release or as may be required by any
          applicable law, regulation or judicial process. Notwithstanding the foregoing, I
          understand that I may disclose the terms of this Release and provide a copy
          hereof to my immediate family and my financial and legal advisors. 



             6.    
          I understand that if any provision of this Release or my compliance with any
          provision of this Release constitutes a violation of any law, or is or becomes
          unenforceable or void, then such provision, to the extent only that it is in
          violation of law, unenforceable or void, will be deemed modified to the extent
          necessary so that it is no longer in violation of law, unenforceable or void,
          and such provision will be enforced to the fullest extent permitted by law. If
          such modification is not possible, such provision, to the extent that it is in
          violation of law, unenforceable or void, will be deemed severable from the
          remaining provisions of this Release, which provisions will remain binding on
          me. 



             7.    
          I have read this Release carefully, have been given at least twenty-one (21)
          days to consider all of its terms, have been advised to consult with an attorney
          and any other advisors of my choice, and fully understand that by signing below
          I am giving up any right that I may have to sue or bring any Claims (other than
          the Excluded Claims) against the Releasees. I have not been forced or pressured
          in any manner whatsoever to sign this Release, and I agree to all of its terms
          voluntarily. 



             8.    
          I understand that I have seven (7) days from the date I have signed this Release
          below to revoke my signature, that this Release will not become effective until
          the eighth (8th) day following the date that I have signed this Release, and
          that if I revoke my signature, I will not be entitled to the payments from the
          Company described in Section 4 of the Separation Agreement. 



             9.    
          I understand and agree that this Release will be governed by the law of the
          State of Colorado, to the extent not preempted by federal law. 


By:___________________________

Name:
Title:
  


Dated: 


5







Exhibit B 


FORM OF RELEASE AGREEMENT 



        This
release (“Release”) is made by Champps Entertainment, Inc., a Delaware
corporation (“Company”) in consideration of and subject to the terms and
conditions set out in the Separation Agreement dated as of March 2, 2005 between the
Company and William H. Baumhauer (the “Executive”) to which this Release is
attached.. The Executive has been employed by Company as its President and Chief Executive
Officer since July 1999. 



             1.       
          In consideration for the promises made by the parties under the Separation
          Agreement, the receipt and sufficiency of which are hereby acknowledged, the
          Company hereby releases and forever discharges, except as expressly provided
          herein, the Executive and his successors and assigns, past and present (the
          “Released Parties”), jointly and individually, from any and all
          claims, obligations, demands, damages, causes of action or liabilities of any
          nature or kind whatsoever, known or unknown, which the Company and/or a
          subsidiary or affiliate of the Company ever had or now has arising out of or in
          any way connected with the Executive’s employment with, and/or separation
          from, the Company and/or its subsidiaries and affiliates including, but not
          limited to, claims arising under or relating to the employment agreement dated
          as of May 22, 2003 between the Company and the Executive, and the
          Executive’s services as a director of the Company; provided, however, that
          this release does not include, and specifically excludes, any and all claims,
          obligations, demands, damages, causes of action or liabilities relating to or
          arising out of any criminal conduct or any claims as to which indemnification of
          a director or officer of the Company would be unavailable under the By-Laws of
          the Company or under Delaware law. 



             2.       
          The Company agrees not to make, assert or maintain (either directly or
          indirectly through a subsidiary or affiliate of the Company) any charge, claim,
          demand or action which would be covered by this release. If the Company breaches
          this provision, it agrees to indemnify the Released Parties for any
          attorneys’ fees and expenses incurred by any of them in defending against
          such a lawsuit. 


Champps Entertainment, Inc. 


By:___________________________

Name:

Title:


Dated:  


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