<p>One of my co-workers claims that even though the execution path is cached, there is no way parameterized SQL generated from an ORM is as quick as a stored procedure. Any help with this stubborn developer?</p>

I would start by reading this article:
http://decipherinfosys.wordpress.com/2007/03/27/using-stored-procedures-vs-dynamic-sql-generated-by-orm/
Here is a speed test between the two:
http://www.blackwasp.co.uk/SpeedTestSqlSproc.aspx