Exhibit 10.1

 

SEPARATION AGREEMENT AND RELEASE

 

This Separation Agreement and Release (the “Agreement”) is made and entered into
by and between Summer Infant, Inc. and its subsidiaries, including, without
limitation, Summer Infant (USA), Inc. (collectively, the “Company”) and Steven
Gibree (“Gibree”).

 

RECITALS

 

A.            Gibree has been employed by the Company as Executive Vice
President since March 6, 2007, and has also served on the Board of Directors
since that time.

 

B.            Gibree’s employment at the Company has been terminated as a result
of his voluntary resignation, effective November 18, 2010, at which time Gibree
will be relieved of all responsibilities as a Company employee.

 

C.            Gibree shall also voluntarily resigned from his position as a
director of the Company and of all subsidiaries of the Company as of the date of
execution hereof.

 

D.            The parties wish to settle and compromise fully and finally any
and all claims Gibree has or purports to have against the Company and others,
including, but not limited to, those arising out of Gibree’s employment and the
termination of his employment, on the terms and conditions set forth in this
Agreement.

 

COVENANTS

 

In consideration of the mutual promises in this Agreement, the parties agree as
follows:

 

1.             Termination.  Gibree and the Company agree that Gibree’s
employment is terminated as of November 18, 2010 (the “Termination Date”) and he
shall be deemed to have resigned from all offices held in the Company or any of
its subsidiaries on such date.  Gibree and the Company further agree that Gibree
hereby resigns as a director of the Company and its subsidiaries effective the
date of execution hereof.  The effective date of this Agreement (the “Effective
Date”) is defined in Section 9.  Gibree will be paid all earned wages, accrued
but unpaid benefits relating to vacations, other perquisites, and reimbursements
through the Termination Date on or before the Effective Date.  In addition,
Gibree will receive:

 

For a period of twelve months following the Termination Date, the Company shall
pay to Gibree his base salary of $255,000 in equal installments on such dates as
his base salary would otherwise be paid by the Company in accordance with its
regular payroll procedures, less applicable deductions and withholdings.

 

(a)           In satisfaction of any bonus amount which Gibree would have been
eligible to receive with respect to 2010 performance, the Company shall pay to
Gibree a lump sum of $85,000, less applicable deductions and withholdings, which
payment shall be made concurrent with the payment to other recipients of 2010
performance bonus payments but in any event prior to March 15, 2011.  The
parties agree that this lump sum payment represents full satisfaction of any
bonus award for which Gibree may have been eligible under the Company’s

 

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existing incentive compensation policy for 2010 and that Gibree is not entitled
to any other cash incentive payments.

 

(b)           For a period of twelve months following the Termination Date, the
Company agrees to continue any applicable medical and dental insurance in which
Gibree and his dependants, if any, are enrolled on the Termination Date at the
same coverage levels and cost to Gibree in effect on the Termination Date. 
Gibree will continue to be responsible for the same premiums he currently pays
which will be deducted from the salary continuation payments described in
Section 1(a).  If the Company’s insurance company informs the Company that
Gibree cannot continue under the applicable plans after the Termination Date,
the Company will cooperate with Gibree to provide coverage pursuant to the
Consolidated Omnibus Budget Reconciliation Act of 1986, as amended (COBRA). 
Notwithstanding the foregoing, during the twelve months the Company is obligated
to continue the medical and dental benefits under the terms of this
Section 1(c), such benefits shall be discontinued immediately if any required
premium is not paid in full on time, Gibree becomes covered under another group
health plan, Gibree becomes entitled to Medicare benefits (under Part A, Part B,
or both), or the Company ceases to provide any group health plan for its
employees.  Continuation may also be terminated if for any reason the plan
providing such coverage would terminate coverage of a participant or an eligible
dependent.

 

(c)           The Company shall pay for twelve months following the Termination
Date the premiums for Gibree for life insurance and disability coverage as
provided to him as of the Termination Date under either the current policies, if
possible, or comparable standard policies implemented for Company employees. 
The parties acknowledge and agree that Gibree participated in the Company’s
401(k) plan, and his rights to benefits under that plan following the
Termination Date will be governed by the terms of that plan.

 

(d)           The following incentive awards will continue to vest through their
respective scheduled vesting date as follows:  (i) restricted stock grant
awarded January 15, 2009, of which 10,000 shares are scheduled to vest on
January 15, 2011(the “Stock Award”) and (ii) incentive stock option grant
awarded January 5, 2009, of which 3,312 shares are scheduled to vest on
January 5, 2011 (the “Option”).  Promptly after January 15, 2011, the Company
will deliver or cause to be delivered the 10,000 vested shares under the Stock
Award, and the remaining unvested shares under the Stock Award shall be
forfeited and of no further effect.  As of January 5, 2011, the Option will
cease to vest and the Option will be exercisable until the expiration of the
original term of the Option.  All other incentive awards vested as of the
Termination Date held by Gibree may be exercised according to their original
expiration terms, and thereafter shall be deemed null and void.  All other
unvested incentive awards as of the Termination Date held by Gibree will be
deemed terminated and of no further effect.

 

(e)           The Company will provide Gibree with twelve months of
executive-level outplacement services from one or more firms chosen by the
Company.  Gibree will be permitted to maintain his car allowance as currently
provided by the Company until December 31, 2010.

 

2.     Severance Consideration.  In consideration for the execution, delivery,
and non-revocation of this Agreement by Gibree, the Company will accept Gibree’s
voluntary resignation, will provide the consideration set forth in Section 1 of
this Agreement, and shall

 

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agree to enter into the Release as set forth in Section 4 of this Agreement (the
“Severance Consideration”).

 

3.             No Entitlement.  Gibree understands and agrees that he is
receiving this Severance Consideration in exchange for this Release, and Gibree
is not otherwise entitled to this Severance Consideration.

 

4.             Release.  The Release set forth in this section is effective as
of the Effective Date of this Agreement.

 

(a)           Gibree for himself and, as applicable, his agents, attorneys,
successors, and assigns, hereby knowingly and voluntarily irrevocably and
unconditionally releases the Company, its predecessors, parent, subsidiaries,
affiliated entities, and the past and present officers, directors, employees,
fiduciaries, shareholders, agents, successors, representatives and assigns of
each and all of them, and all persons acting by, through, under or in concert
with them (each a “Releasee” and collectively referred to as “Releasees”), from
any and all claims, charges, complaints, liabilities, and obligations of any
nature whatsoever, which Gibree may have against the Company or any of the
Releasees, whether now known or unknown, and whether asserted or unasserted,
arising from any event or omission occurring prior to the Effective Date of this
Agreement.

 

(b)           Without limiting the foregoing, this release includes any and all
claims arising out of or which could arise out of the employment relationship
between Gibree and the Company and Gibree’s termination, including but not
limited to: (i) any and all claims under Title VII of the Civil Rights Act of
1964, the Americans with Disabilities Act, Section 1981 of the Civil Rights Act
of 1866, the Age Discrimination in Employment Act, the Equal Pay Act, the Family
and Medical Leave Act, the Fair Labor Standards Act, the Employee Retirement
Income Security Act (ERISA), COBRA, the Rhode Island Parental and Family Medical
Leave Act, the Rhode Island Fair Employment Practices Act, the Rhode Island
Civil Rights Act of 1990, the National Labor Relations Act, as amended, state
and local civil rights laws, Rhode Island wage payment laws, and any and all
similar laws in other states; (ii) any and all Executive Orders (governing fair
employment practices) which may be applicable to the Company; and (iii) any
other provision or theory of law or equity.  Gibree understands and acknowledges
that Title VII of the Civil Rights Act of 1964, ERISA, and state and local civil
right laws, provide Gibree the right to bring actions against the Company if,
among other things, Gibree believes he has been discriminated against on the
basis of race, ancestry, color, religion, sex, national origin, medical
condition, sexual orientation, disability, or benefit eligibility.  With full
understanding of the right afforded under these Acts, Gibree agrees that he will
not file any action against the Company or any Releasee based upon any alleged
violation of these Acts or under any other theory of law or statute, including
but not limited to, back pay, front pay, attorney’s fees, damages, interest,
waiting time, penalties, reinstatement, or injunctive relief that could be
assessed by any federal, state or local court, any administrative agency, or any
other forum with competent jurisdiction.  This release may be pled as a complete
bar and defense to any claim brought with respect to the matters released in
this Agreement.

 

(c)           Gibree acknowledges and agrees that the consideration he is
receiving under this Agreement is sufficient consideration to support the
release of all entities and persons

 

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identified in Section 4 of this Agreement, and that said consideration is in
addition to anything of value to which Gibree is entitled.

 

(d)           Gibree agrees and represents that he has not filed, or caused to
be filed, any claim or charge with any adjudicative body, regulatory body, or
agency arising out of his employment or termination of employment.

 

(e)           Gibree specifically understands and acknowledges that the Age
Discrimination in Employment Act of 1967, as amended, provides him the right to
bring a claim against the Company if he believes that he has been discriminated
against on the basis of age. Gibree understands the rights afforded under this
Act and agrees that he will not file any such claim or action against the
Company or any Releasee, including, but not limited to, back pay, front pay,
attorney’s fees, damages, reinstatement, or injunctive relief.

 

(f)            To the fullest extent permitted by law, at no time subsequent to
the execution of this Agreement will Gibree pursue, or cause or knowingly permit
the prosecution, in any state, federal or foreign court, or before any local,
state, federal or administrative agency, or any other tribunal, any charge,
claim or action of any kind, nature and character whatsoever, known or unknown,
which Gibree may now have, has ever had, or in the future may have against any
Releasee, which is based in whole or in part on any matter covered by this
Agreement.

 

5.             Communications; Return of Property.  From and after the
Termination Date, Gibree shall not (a) represent himself as an employee,
officer, director or representative of the Company or any of its subsidiaries or
attempt to conduct business in the name or on behalf of the Company or any of
its subsidiaries; (b) send e-mails directed to anyone on the Company’s e-mail
system,; or (c) visit the Company’s premises without consent of the Company. 
Upon the Termination Date, Gibree agrees to promptly return all items of Company
property he has or over which he has control, including but not limited to all
keys, records, designs, patents, business plans, financial statements, manuals,
memoranda, lists, and other property delivered to or compiled by Gibree by or on
behalf of the Company (or its subsidiaries) or its representatives, vendors, or
customers that pertain to the business of the Company (or its subsidiaries), all
equipment belonging to the Company, all code and computer programs and
information of whatever nature, tools, manuals, and any and all other materials,
documents or information, including but not limited to confidential information
in his possession or control, and that he will retain no copies thereof. 
Likewise, all correspondence, reports, records, charts, advertising materials,
and other similar data pertaining to the business, activities or future plans of
the Company (or its subsidiaries) that has been collected by Gibree shall be
delivered promptly to the Company upon the Termination Date.

 

6.             Trade Secrets/Confidentiality.  Gibree acknowledges that during
the course of his employment, he had access to various trade secrets, whether in
existence or proposed, and confidential information of the Company.  Such
information includes, but is not limited to, business plans, schematics, blue
prints, product information, software, hardware, financial information, manuals,
training programs, profit margins, marketing plans, customer information, and
the specific terms of the Company’s relationships or agreements with its
respective significant vendors or customers. Gibree agrees that he shall not
disclose such information or use it in any way, at any time in the future,
except to the extent such information becomes publicly available through lawful
and proper means, or to the extent that Gibree is required to disclose

 

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such information pursuant to subpoena.  If such information is requested
pursuant to a subpoena, Gibree must give immediate and timely notice to the
Company, so that the Company has a reasonable opportunity to seek judicial
relief to preclude disclosure, if necessary.  Without limitation, the
prohibition in this section includes Gibree’s use of such information to
directly or indirectly solicit any manufacturer, manufacturer’s representative,
distributor, or customer of the Company or any of its subsidiaries, and Gibree’s
use of such information to directly or indirectly interfere with the
advantageous business relationship(s) between the Company and any of its
customers, vendors or suppliers.

 

7.     Restrictive Covenants.

 

(a)           Notwithstanding the restrictions set forth in Section 6 of this
Agreement, for a period of twelve months from the Termination Date:

 

i.              Gibree will not, and will not permit any person subject to his
direction or control to, directly or indirectly, whether alone or in association
with others, as principal, officer, agent, consultant, employee, director or
owner of any corporation, partnership, association or other entity, or through
the investment of capital, lending of money or property, rendering of services
or otherwise, engage in, influence, control, have an interest in or otherwise
become actively involved with any business that competes with the Company. 
Gibree acknowledges that the business of the Company is national and
international in scope, as its current and anticipated customers and suppliers
are located throughout the United States and abroad, and that it is therefore
reasonable that the restrictions set forth in this Section 7(a)(i) not be
limited to any specified geographic area.

 

ii.             Gibree will not directly or indirectly attempt to encourage,
induce or otherwise solicit, directly or indirectly, any employee of the
Company, or any of its affiliates or subsidiaries, to breach his or her
employment agreement or to leave their employment;

 

iii.            Gibree will not directly or indirectly attempt to encourage,
induce or otherwise solicit, directly or indirectly, any business from, or
attempt to sell, license, or provide the same or similar products or services as
provided by the Company or any subsidiary of the Company to any customer of the
Company; and

 

iv.            Gibree will not call upon any prospective acquisition candidate,
on Gibree’s own behalf or on behalf of any person, which candidate was, to
Gibree’s knowledge after due inquiry, either called upon by the Company, or any
of its affiliates or subsidiaries, or for which the Company made an acquisition
analysis, for the purpose of acquiring such candidate.

 

(b)           The parties acknowledge that covenants and restrictions set forth
in Sections 6 and 7 are necessary to protect the legitimate business interests
of the Company.  The parties agree that, if the scope of enforceability of any
or all the restrictive covenants set forth in this Agreement is in any way
disputed at any time, a court may modify and enforce the covenants to the extent
it believes to be reasonable under the circumstances existing at that time.

 

(c)           Gibree agrees that the breach by him of Sections 6 and 7 could not
reasonably or adequately be compensated in damages in an action at law, and that
the Company

 

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shall be entitled to injunctive relief which may include, but shall not be
limited to, restraining Gibree from engaging in any activity that would breach
this Agreement.  However, no remedy conferred by any of the specific provisions
of Sections 6 and 7 (including this paragraph) is intended to be exclusive of
any other remedy and each and every remedy shall be cumulative and shall be in
addition to every other remedy given hereunder, or now or hereafter existing in
law or in equity, or by statute or otherwise.  The election of any one or more
remedies by the Company shall not constitute a waiver of the right to pursue
other available remedies.

 

8.             Sufficient Time to Review.  A copy of this Agreement was
delivered to Gibree on November 18, 2010.  Gibree acknowledges that he has been
afforded a reasonable opportunity to consider this Agreement and is encouraged
to consult with an attorney of his own choosing in deciding whether to execute
this Agreement.  Gibree acknowledges that he has been given a period of at least
21 days within which to consider this Agreement, and that he has read and fully
understands the Agreement and enters into it freely, voluntarily, and without
coercion, and in the event that he executes this Agreement in less than 21 days,
his election to do so has been knowing and voluntary.

 

9.             Revocation Period.  Gibree understands that he has a period of
seven days from the date he signs this Agreement to revoke this Agreement, and
that, should he decide to revoke it within said seven-day period, he shall not
be entitled to the consideration recited herein.  Gibree further understands
that this Agreement shall not become effective or enforceable until the
expiration of the seven-day period, and, therefore, that he shall not receive
the consideration set forth herein until the revocation period has expired
without Gibree exercising his right of revocation. Gibree agrees that he must
provide written notice of revocation of this Agreement to Mark Strozik, Vice
President, Human Resources, Summer Infant, Inc., 1275 Park East Drive,
Woonsocket, RI 02895, should he wish to exercise his rights to revoke this
Agreement within the revocation period.  If this Agreement is not timely
revoked, this Agreement will become effective as of the expiration of the
revocation period (“Effective Date”).

 

10.           Termination of Change of Control Agreement.  The parties hereby
agree that the Change of Control Agreement by and between the Gibree and Summer
Infant (USA), Inc. dated as of February 5, 2010, is terminated effective as of
the Termination Date.

 

11.           Acknowledgement.  Gibree acknowledges, represents and warrants
that he enters into this Agreement knowingly, voluntarily, free of duress or
coercion, and with a full understanding of all terms and conditions contained
herein.

 

12.           Headings.  The headings are for convenience of the parties, and
are not to be construed as terms and conditions of this Agreement.

 

13.           Severability. Should any provision in this Agreement be declared
or determined to be illegal or invalid (with the exception of Section 4, in
whole or in part, subsections included), the validity of the remaining parts,
terms, or provisions shall not be affected and the illegal or invalid part,
term, or provisions shall be deemed not to be part of this Agreement.

 

14.           Integration.  This Agreement constitutes the entire agreement
between the parties, and supersede all oral negotiations and any prior and other
writings with respect to the subject

 

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matter of this Agreement, and is intended by the parties as the final, complete
and exclusive statement of the terms agreed to by them.

 

15.           Choice of Law.  This Agreement shall be governed by and construed
in accordance with the laws of the State of Rhode Island.

 

16.           Amendment.  This Agreement shall be binding upon the parties and
may not be amended, supplemented, changed, or modified in any manner, orally or
otherwise, except by an instrument in writing of concurrent or subsequent date
signed by the parties.

 

17.           Successors and Assigns.  This Agreement is and shall be binding
upon and inure to the benefit of the heirs, executors, successors and assigns of
each of the parties.

 

18.           Non-Admission.  This Agreement shall not in any way be construed
as an admission by the Company that it has acted wrongfully with respect to
Gibree, and the Company specifically denies the commission of any wrongful acts
against Gibree.

 

19.           Non-Disparagement.  Gibree agrees that he will not make any
written or oral statement or take any action which he knows or reasonably should
know constitutes an untrue, disparaging, or negative comment concerning the
Company.  The Company agrees that it will not make any written or oral statement
or take any action which it knows or reasonably should know constitutes an
untrue, disparaging, or negative comment concerning Gibree.  If the Company’s
Human Resources Department is contacted by prospective employers of Gibree, the
Company will provide only the starting and ending dates of Gibree’s employment
at the Company and the last position Gibree held at the Company.  The Company
also will advise any such prospective employers that it is the Company’s policy
to release only such information.

 

20.           Reservation of Rights to Indemnification and Director and Officer
Liability Insurance for Actions Taken or Omitted While a Director or Executive
Officer.  Gibree’s right to indemnification to the fullest extent permitted by
Delaware General Corporation Law and the Company’s Certificate of Incorporation
and By-Laws for expenses (including attorney’s fees and disbursements),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by Gibree in connection with any proceeding arising by reason of acts taken or
omissions to act occurring while Employee was an executive officer or director
of the Company or an executive officer or director of any of the Company’s
subsidiaries, shall continue unabridged after the Termination Date.

 

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

 

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IN WITNESS WHEREOF, the parties execute this Agreement as of the date indicated
below.

 

 

 

 

Summer Infant, Inc.

 

 

 

 

 

 

 

/s/ Steven Gibree

 

By:

/s/ Jason P. Macari

Steven Gibree

 

Name:

Jason P. Macari

 

 

Title:

President & CEO

 

 

 

 

Date:

12/10/10

 

Date:

12/10/10

 

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