Exhibit 10.1

September 7, 2006

Kathryn Olson

LeapFrog Enterprises, Inc.

6401 Hollis Street, Suite 100

Emeryville, CA 94608

Dear Kathryn:

This letter sets forth the terms and conditions of the separation agreement (the
“Agreement”) LeapFrog Enterprises, Inc. (“LeapFrog” or the “Company”) is
offering to you.

1. Separation From Employment Service.

(a) Separation Date. You will resign as the Company’s Chief Marketing Officer
and as an employee of the Company effective as of September 7, 2006 (the
“Separation Date”). Except as expressly provided herein, you will not hold any
employment or other positions with the Company after the Separation Date.

(b) Final Pay. On the Separation Date, the Company will pay you all remaining
earned but unpaid salary, and all accrued but unused vacation earned through the
Separation Date, less applicable deductions and withholdings. You are entitled
to this payment regardless of whether or not you sign this Agreement.

(c) Expense Reimbursements. Within thirty (30) days after the Separation Date,
you will submit your final documented expense reimbursement statement reflecting
all business expenses you incurred through the Separation Date, if any, for
which you seek reimbursement. The Company will reimburse you for these expenses
pursuant to its regular business practices and procedures.

(d) Health Insurance. To the extent provided by the federal COBRA law or, if
applicable, state insurance laws, and by the Company’s current group health
insurance policies, you will be eligible to continue your group health insurance
benefits after the Separation Date at your own expense. Later, you may be able
to convert to an individual policy through the provider of the Company’s health
insurance, if you wish. You will be provided with a separate notice describing
your rights and obligations under COBRA on or after the Separation Date.

2. Severance Benefits. In exchange for entering into and abiding by the terms of
this Agreement, the Company will provide you with the severance benefits (the
“Severance Benefits”) described below.

(a) Salary Continuation Benefits. The Company shall make continuing base salary
payments to you (at the base salary rate in effect as of the Separation Date,
i.e., $24,666.67 per month) for twelve (12) months (the “Salary Continuation
Payments”). The Salary

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Continuation Payments shall be paid, subject to applicable withholdings and
deductions, on the Company’s customary payroll pay dates starting on the first
payroll date after the Effective Date (as defined herein) of this Agreement.

(b) COBRA Reimbursement. Provided you timely elect to continue your health
insurance coverage after the Separation Date pursuant to the federal COBRA law
or applicable state law, and the terms and conditions of the applicable group
health insurance plans, the Company will reimburse you for all premiums
necessary to maintain your health insurance coverage as of the Separation Date
(for yourself, spouse and any covered dependents) in effect through the twelve
(12) month anniversary of the Separation Date or until such earlier date as you
become eligible for group health insurance through a subsequent employer (the
“COBRA Reimbursement”). You agree to immediately notify the Company in writing
as soon as you become eligible for health insurance coverage through a
subsequent employer. The monthly COBRA Reimbursement amount will be paid
simultaneously with the Salary Continuation Payments.

(c) Reimbursement for Outplacement Services. For the six (6) month period after
the Separation Date, the Company will pay for outplacement services provided to
you by a firm reasonably approved by the Company, up to a maximum amount of
$10,000, with such amount to be paid to you in the form of reimbursement after
presentation by you to the Company of an invoice for bona fide outplacement
services rendered to you. If you choose not to use such outplacement services,
no compensation will be paid to you in lieu thereof.

(d) Accelerated Vesting of Restricted Stock. The installment of 7,500 shares of
the Company’s Restricted Stock (representing 30% of the 25,000-share award
granted to you on November 10, 2004), that would otherwise vest on November 10,
2006, will vest on an accelerated basis on the Effective Date, notwithstanding
anything to the contrary in your restricted stock award. The remaining shares of
the November 10, 2004 restricted stock award, as well as any other equity awards
you may hold, will be governed by their terms and the terms of any applicable
plan and are not modified in any way by this Agreement.

(e) No Other Severance Benefits. The benefits provided to you under this
Agreement shall entirely supersede and replace any and all severance benefits
available to you under any applicable employment agreement, any other agreement
between you and the Company, or pursuant to any other Company plan, policy or
practice.

3. Other Compensation Or Benefits. You acknowledge that, except as expressly
provided in this Agreement, you will not receive any additional compensation,
bonuses, severance or other benefits from the Company after the Separation Date.

4. Return Of Company Property.

(a) General Obligations. On the Separation Date and excluding only the materials
described in subsection 4(b) below, you agree to immediately return to the
Company all Company documents (and all copies thereof) and other Company
property in your possession or control, including, but not limited to, Company
files, notes, correspondence, memoranda, notebooks, drawings, records, reports,
lists, compilations of data, proposals, agreements, drafts,

 

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minutes, studies, plans, forecasts, purchase orders, financial and operational
information, product and training information, research and development
information, customer information and contact lists, sales and marketing
information, personnel and compensation information, vendor information,
promotional literature and instructions, product specifications and
manufacturing information, computer-recorded information, electronic information
(including e-mail and correspondence), other tangible property and equipment
(including, but not limited to, computer equipment, facsimile machines, and
cellular telephones), credit cards, entry cards, identification badges and keys;
and any materials of any kind that contain or embody any proprietary or
confidential information of the Company (and all reproductions thereof in whole
or in part). You agree that you will make a diligent search to locate any such
documents, property and information. In addition, if you have used any
personally owned computer, server, or e-mail system to receive, store, review,
prepare or transmit any Company confidential or proprietary data, materials or
information, you agree to immediately provide the Company with a
computer-useable copy of all such information and then permanently delete and
expunge such Company confidential or proprietary information from those systems;
and you agree to provide the Company access to your system as requested to
verify that the necessary copying and/or deletion is done. The Company will make
one of its IT specialists available to work with you directly to ensure your
compliance with the foregoing duplication and expungement processes. Your timely
return of all such Company documents and other property is a precondition to
your receipt of the Severance Benefits under this Agreement.

(b) Retained Materials. Notwithstanding the foregoing, after the Separation
Date, you shall be entitled to retain a copy of: (i) all documents which you
executed in connection with your employment with the Company, including but not
limited to the any applicable employment agreement and Employee Proprietary
Information and Inventions Agreement; (ii) all wage statements and other payroll
records issued to you by the Company and well as documents issued to you with
regard to your employee benefits with the Company; and (iii) all Company
documents and information which the Company issued to you in your capacity as a
Company option holder and/or shareholder and which was otherwise made available
or issued to other Company option holders and/or stockholders generally.

5. Proprietary Information Obligations. You hereby acknowledge and agree to
abide by all of your continuing obligations under your Employee Proprietary
Information and Inventions Agreement (the “Proprietary Information Agreement”),
a copy of which is attached as Exhibit A.

6. Confidentiality. The provisions of this Agreement will be held in strictest
confidence by you and the Company and will not be publicized or disclosed in any
manner whatsoever; provided, however, that: (a) you may disclose this Agreement
in confidence to your immediate family; (b) the parties may disclose this
Agreement in confidence to their respective attorneys, accountants, auditors,
tax preparers, and financial advisors; (c) the Company may disclose this
Agreement as reasonably necessary or advisable to fulfill standard or legally
required reporting or disclosure requirements or to fulfill fiduciary duties;
and (d) the parties may disclose this Agreement insofar as such disclosure is
necessary to enforce its terms or as otherwise required by law. In particular,
and without limitation, you agree not to disclose the terms of this Agreement to
any current or former Company employee, consultant or independent contractor.

 

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7. Nondisparagement. You and the Company (through its officers and directors)
each agree not to disparage the other in any manner likely to be harmful to the
other’s business, business reputation, or personal reputation; provided,
however, that both you and the Company may respond accurately and fully to any
request for information to the extent required by legal process.

8. No Voluntary Adverse Action. You agree that you will not voluntarily (except
in response to legal compulsion) assist any person in bringing or pursuing any
proposed or pending litigation, arbitration, administrative claim or other
formal proceeding against the Company, its parent or subsidiary entities,
affiliates, officers, directors, employees or agents.

9. Cooperation. You agree to cooperate fully with the Company in connection with
its actual or contemplated defense, prosecution, or investigation of any claims
or demands by or against third parties, or other matters arising from events,
acts, or failures to act that occurred during the period of your employment by
the Company. Such cooperation includes, without limitation, making yourself
available to the Company upon reasonable notice, without subpoena, to provide
truthful and accurate information in witness interviews and deposition and trial
testimony. The Company will reimburse you for reasonable out-of-pocket expenses
you incur in connection with any such cooperation (excluding forgone wages,
salary, or other compensation) and will make reasonable efforts to accommodate
your scheduling needs. In addition, you agree to execute all documents (if any)
necessary to carry out the terms of this Agreement.

10. No Admissions. Nothing contained in this Agreement shall be construed as an
admission by you or the Company of any liability, obligation, wrongdoing or
violation of law.

11. Release of Claims. In exchange for the consideration under this Agreement to
which you would not otherwise be entitled, including but not limited to the
Severance Benefits, you hereby generally and completely release the Company and
its parent or subsidiary entities, successors, predecessors and affiliates, and
its and their directors, officers, employees, shareholders, agents, attorneys,
insurers, affiliates and assigns, from any and all claims, liabilities and
obligations, both known and unknown, that arise from or are in any way related
to events, acts, conduct, or omissions occurring at any time prior to and
including the date you sign this Agreement. This general release includes, but
is not limited to: (a) all claims arising out of or in any way related to your
employment with the Company or the termination of that employment; (b) all
claims related to your compensation or benefits from the Company, including
salary, bonuses, commissions, vacation pay, expense reimbursements, severance
payments, fringe benefits, stock, stock options, or any other ownership or
equity interests in the Company; (c) all claims for breach of contract, wrongful
termination, and breach of the implied covenant of good faith and fair dealing;
(d) all tort claims, including but not limited to claims for fraud, defamation,
emotional distress, and discharge in violation of public policy; and (e) all
federal, state, and local statutory claims, including claims for discrimination,
harassment, retaliation, attorneys’ fees, or other claims arising under the
federal Civil Rights Act of 1964 (as amended), the federal Americans with
Disabilities Act of 1990 (as amended), the federal Age Discrimination in
Employment Act of 1967 (as amended) (the “ADEA”), and the California Fair
Employment and Housing Act (as amended). You represent that you have no
lawsuits, claims or actions pending in your name, or on behalf of any other
person or entity, against the Company or any other person or entity subject to
the release granted in this paragraph. Notwithstanding

 

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anything in this paragraph, you are not hereby releasing the Company from any
obligation it may otherwise have to indemnify you for your acts within the
course and scope of your employment with the Company, nor from any obligations
undertaken by the Company in this Agreement.

12. ADEA Waiver. You acknowledge that you are knowingly and voluntarily waiving
and releasing any rights you have under the ADEA, and that the consideration
given for the waiver and releases you have given in this Agreement is in
addition to anything of value to which you were already entitled. You further
acknowledge that you have been advised, as required by the ADEA, that: (a) your
waiver and release does not apply to any rights or claims that arise after the
date you sign this Agreement; (b) you should consult with an attorney prior to
signing this Agreement (although you may choose voluntarily not to do so);
(c) you have twenty-one (21) days to consider this Agreement (although you may
choose voluntarily to sign it sooner); (d) you have seven (7) days following the
date you sign this Agreement to revoke this Agreement (in a written revocation
sent to the Company’s General Counsel); and (e) this Agreement will not be
effective until the date upon which the revocation period has expired, which
will be the eighth day after you sign this Agreement (the “Effective Date”).

13. Section 1542 Waiver. In giving the releases set forth in this Agreement,
which include claims which may be unknown to you at present, you acknowledge
that you have read and understand Section 1542 of the California Civil Code
which reads as follows: “A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at the time of executing
the release, which if known by him must have materially affected his settlement
with the debtor.” You hereby expressly waive and relinquish all rights and
benefits under that section and any law or legal principle of similar effect in
any jurisdiction with respect to the releases granted herein, including but not
limited to the release of unknown and unsuspected claims granted in this
Agreement.

14. Voluntary Agreement. By signing this Agreement, you acknowledge that you
have carefully read and understand this Agreement; you understand that this
Agreement is legally binding and by signing it you give up certain rights.

15. Dispute Resolution. To aid in the rapid and economical resolution of any
disputes which may arise under this Agreement, you and the Company agree that
any and all claims, disputes or controversies of any nature whatsoever arising
from or regarding the interpretation, performance, negotiation, execution,
enforcement or breach of this Agreement shall be resolved by confidential, final
and binding arbitration conducted before a single arbitrator with Judicial
Arbitration and Mediation Services, Inc. (“JAMS”) in San Francisco, California,
in accordance with JAMS’ then-applicable arbitration rules. The parties
acknowledge that by agreeing to this arbitration procedure, they waive the right
to resolve any such dispute through a trial by jury, judge or administrative
proceeding. You will have the right to be represented by legal counsel at any
arbitration proceeding. The arbitrator shall: (a) have the authority to compel
adequate discovery for the resolution of the dispute and to award such relief as
would otherwise be available under applicable law in a court proceeding; and
(b) issue a written statement signed by the arbitrator regarding the disposition
of each claim and the relief, if any, awarded as to each claim, the reasons for
the award, and the arbitrator’s essential findings and conclusions on which the
award is based. The Company shall bear JAMS’ arbitration fees and administrative
costs. Nothing in this Agreement shall prevent either you or the Company from

 

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obtaining injunctive relief in court to prevent irreparable harm pending the
conclusion of any such arbitration. Any awards or orders in such arbitrations
may be entered and enforced as judgments in the federal and state courts of any
competent jurisdiction. The arbitrator, and not a court, shall be authorized to
determine whether the provisions of this paragraph apply to a dispute,
controversy or claim sought to be resolved in accordance with these arbitration
procedures.

16. Miscellaneous. This Agreement constitutes the complete, final and exclusive
embodiment of the entire agreement between you and the Company with regard to
its subject matter. It is entered into without reliance on any promise or
representation, written or oral, other than those expressly contained herein,
and it supersedes any other such promises, warranties or representations. This
Agreement may not be modified or amended except in a writing signed by both you
and the Chief Executive Officer of the Company. This Agreement will bind the
heirs, personal representatives, successors and assigns of both you and the
Company, and inure to the benefit of both you and the Company, and their
respective heirs, successors and assigns. If any provision of this Agreement is
determined to be invalid or unenforceable, in whole or in part, this
determination will not affect any other provision of this Agreement and the
provision in question shall be deemed modified so as to be rendered enforceable
in a manner consistent with the intent of the parties insofar as possible under
applicable law. This Agreement shall be deemed to have been entered into, and
construed and enforced in accordance with, the laws of the State of California
without regard to conflicts of law principles. Any ambiguity in this Agreement
shall not be construed against either party as the drafter. Any waiver of a
breach of this Agreement, or rights hereunder, shall be in writing and shall not
be deemed to be a waiver of any successive breach or rights hereunder. This
Agreement may be executed in counterparts which shall be deemed to be part of
one original, and facsimile signatures will suffice as original signatures.

 

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If this Agreement is acceptable to you, please sign below and return the
original to me. You have twenty-one (21) calendar days to decide whether you
would like to accept this Agreement, and the Company’s offer of severance
contained herein will automatically expire if you do not accept it within that
time frame.

We wish you all the best in your future endeavors.

 

Sincerely,

LEAPFROG ENTERPRISES, INC.

By:

  /s/ Jeffrey G. Katz  

Exhibit A –Proprietary Information Agreement

 

UNDERSTOOD AND AGREED: /s/ Kathryn C. Olson Kathryn Olson September 25, 2006
Date

 

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EXHIBIT A

PROPRIETARY INFORMATION AGREEMENT

 

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LEAPFROG ENTERPRISES, INC.

EMPLOYEE PROPRIETARY INFORMATION

AND INVENTIONS AGREEMENT

In consideration of my employment or continued employment by LEAPFROG
ENTERPRISES, INC. (the “Company”), and the compensation now and hereafter paid
to me, I hereby agree as follows:

1. NONDISCLOSURE.

1.1 Recognition of Company’s Rights; Nondisclosure. At all times during my
employment and thereafter, I will hold in strictest confidence and will not
disclose, use, lecture upon or publish any of the Company’s Proprietary
Information (defined below), except as such disclosure, use or publication may
be required in connection with my work for the Company, or unless an officer of
the Company expressly authorizes such in writing. I will obtain Company’s
written approval before publishing or submitting for publication any material
(written, verbal, or otherwise) that relates to my work at Company and/or
incorporates any Proprietary Information. I hereby assign to the Company any
rights I may have or acquire in such Proprietary Information and recognize that
all Proprietary Information shall be the sole property of the Company and its
assigns.

1.2 Proprietary Information. The term “Proprietary Information” shall mean any
and all confidential and/or proprietary knowledge, data or information of the
Company. By way of illustration but not limitation, “Proprietary Information”
includes (a) trade secrets, inventions, mask works, ideas, processes, formulas,
source and object codes, data, programs, other works of authorship, know-how,
improvements, discoveries, developments, designs and techniques (hereinafter
collectively referred to as “Inventions”); and (b) information regarding plans
for research, development, new products, training, marketing and selling,
business plans, budgets and unpublished financial statements, licenses, prices
and costs, suppliers and customers; and (c) information regarding the skills and
compensation of other employees of the Company.

1.3 Third Party Information. I understand, in addition, that the Company has
received and in the future will receive from third parties confidential or
proprietary information (“Third Party Information”) subject to a duty on the
Company’s part to maintain the confidentiality of such information and to use it
only for certain limited purposes. During the term of my employment and
thereafter, I will hold Third Party Information in the strictest confidence and
will not disclose to anyone (other than Company personnel who need to know such
information in connection with their work for the Company) or use, except in
connection with my work for the Company, Third Party Information unless
expressly authorized by an officer of the Company in writing.

1.4 No Improper Use of Information of Prior Employers and Others. During my
employment by the Company I will not improperly use or disclose any confidential
information or trade secrets, if any, of any former employer or any other third
party to whom I have an obligation of confidentiality, and I will not bring onto
the premises of the Company any unpublished documents or any property belonging
to any former employer or any other third party to whom I have an obligation of
confidentiality unless consented to in writing by that former employer or
person. I will use in the performance of my duties only information which is
generally known and used by persons with training and experience comparable to
my own, which is common knowledge in the industry or otherwise legally in the
public domain, or which is otherwise provided or developed by the Company.

2. ASSIGNMENT OF INVENTIONS.

2.1 Proprietary Rights. The term “Proprietary Rights” shall mean all trade
secret, patent, copyright, mask work and other intellectual property rights
throughout the world.

2.2 Prior Inventions. Inventions, if any, patented or unpatented, which I made
prior to the commencement of my employment with the Company are excluded from
the scope of this Agreement. To preclude any possible uncertainty, I have set
forth on Exhibit B (Previous Inventions) attached hereto a complete list of all
Inventions that I have, alone or jointly with others, conceived, developed or
reduced to practice or caused to be conceived, developed or reduced to practice
prior to the commencement of my employment with the Company, that I consider to
be my property or the property of third parties and that I wish to have excluded
from the scope of this Agreement (collectively referred to as “Prior
Inventions”). If disclosure of any such Prior Invention would cause me to
violate any prior confidentiality agreement, I understand that I am not to list
such Prior Inventions in Exhibit B but am only to disclose a cursory name for
each such invention, a listing of the party(ies) to

 

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whom it belongs and the fact that full disclosure as to such inventions has not
been made for that reason. A space is provided on Exhibit B for such purpose. If
no such disclosure is attached, I represent that there are no Prior Inventions.
If, in the course of my employment with the Company, I incorporate a Prior
Invention into a Company product, process or machine, the Company is hereby
granted and shall have a nonexclusive, royalty-free, irrevocable, perpetual,
worldwide license (with rights to sublicense through multiple tiers of
sublicensees) to make, have made, modify, use and sell such Prior Invention.
Notwithstanding the foregoing, I agree that I will not incorporate, or permit to
be incorporated, Prior Inventions in any Company Inventions without the
Company’s prior written consent.

2.3 Assignment of Inventions. Subject to Sections 2.4, and 2.6, I hereby assign
and agree to assign in the future (when any such Inventions or Proprietary
Rights are first reduced to practice or first fixed in a tangible medium, as
applicable) to the Company all my right, title and interest in and to any and
all Inventions (and all Proprietary Rights with respect thereto) whether or not
patentable or registrable under copyright or similar statutes, made or conceived
or reduced to practice or learned by me, either alone or jointly with others,
during the period of my employment with the Company. Inventions assigned to the
Company, or to a third party as directed by the Company pursuant to this
Section 2, are hereinafter referred to as “Company Inventions.”

2.4 Nonassignable Inventions. This Agreement does not apply to an Invention
which qualifies fully as a nonassignable Invention under Section 2870 of the
California Labor Code (hereinafter “Section 2870”). I have reviewed the
notification on Exhibit A (Limited Exclusion Notification) and agree that my
signature acknowledges receipt of the notification.

2.5 Obligation to Keep Company Informed. During the period of my employment and
for six (6) months after termination of my employment with the Company, I will
promptly disclose to the Company fully and in writing all Inventions authored,
conceived or reduced to practice by me, either alone or jointly with others. In
addition, I will promptly disclose to the Company all patent applications filed
by me or on my behalf within a year after termination of employment. At the time
of each such disclosure, I will advise the Company in writing of any Inventions
that I believe fully qualify for protection under Section 2870; and I will at
that time provide to the Company in writing all evidence necessary to
substantiate that belief. The Company will keep in confidence and will not use
for any purpose or disclose to third parties without my consent any confidential
information disclosed in writing to the Company pursuant to this Agreement
relating to Inventions that qualify fully for protection under the provisions of
Section 2870. I will preserve the confidentiality of any Invention that does not
fully qualify for protection under Section 2870.

2.6 Government or Third Party. I also agree to assign all my right, title and
interest in and to any particular Company Invention to a third party, including
without limitation the United States, as directed by the Company.

2.7 Works for Hire. I acknowledge that all original works of authorship which
are made by me (solely or jointly with others) within the scope of my employment
and which are protectable by copyright are “works made for hire,” pursuant to
United States Copyright Act (17 U.S.C., Section 101).

2.8 Enforcement of Proprietary Rights. I will assist the Company in every proper
way to obtain, and from time to time enforce, United States and foreign
Proprietary Rights relating to Company Inventions in any and all countries. To
that end I will execute, verify and deliver such documents and perform such
other acts (including appearances as a witness) as the Company may reasonably
request for use in applying for, obtaining, perfecting, evidencing, sustaining
and enforcing such Proprietary Rights and the assignment thereof. In addition, I
will execute, verify and deliver assignments of such Proprietary Rights to the
Company or its designee. My obligation to assist the Company with respect to
Proprietary Rights relating to such Company Inventions in any and all countries
shall continue beyond the termination of my employment, but the Company shall
compensate me at a reasonable rate after my termination for the time actually
spent by me at the Company’s request on such assistance.

In the event the Company is unable for any reason, after reasonable effort, to
secure my signature on any document needed in connection with the actions
specified in the preceding paragraph, I hereby irrevocably designate and appoint
the Company and its duly authorized officers and agents as my agent and attorney
in fact, which appointment is coupled with an interest, to act for and in my
behalf to execute, verify and file any such documents and to do all other
lawfully permitted acts to further the purposes of the preceding paragraph with
the same legal force and effect as if executed by me. I hereby waive and
quitclaim to the Company any and all claims, of any nature whatsoever, which I
now or may hereafter have for infringement of any Proprietary Rights assigned
hereunder to the Company.

3. RECORDS. I agree to keep and maintain adequate and current records (in the
form of notes, sketches,

 

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drawings and in any other form that may be required by the Company) of all
Proprietary Information developed by me and all Inventions made by me during the
period of my employment at the Company, which records shall be available to and
remain the sole property of the Company at all times.

4. ADDITIONAL ACTIVITIES. I agree that during the period of my employment by the
Company I will not, without the Company’s express written consent, engage in any
employment or business activity which is competitive with, or would otherwise
conflict with, my employment by the Company. I agree further that for the period
of my employment by the Company and for one (l) year after the date of
termination of my employment by the Company I will not, either directly or
through others, solicit or attempt to solicit any employee, independent
contractor or consultant of the company to terminate his or her relationship
with the Company in order to become an employee, consultant or independent
contractor to or for any other person or entity. I agree further that for the
period of my employment with the Company and for one (1) year after the date of
termination of my employment with the Company I will not in any manner
discourage any client or customer of the Company from continuing its business
relationship with the Company.

5. NO CONFLICTING OBLIGATION. I represent that my performance of all the terms
of this Agreement and as an employee of the Company does not and will not breach
any agreement to keep in confidence information acquired by me in confidence or
in trust prior to my employment by the Company. I have not entered into, and I
agree I will not enter into, any agreement either written or oral in conflict
herewith.

6. RETURN OF COMPANY DOCUMENTS. When I leave the employ of the Company, I will
deliver to the Company any and all drawings, notes, memoranda, specifications,
devices, formulas, and documents, together with all copies thereof, and any
other material containing or disclosing any Company Inventions, Third Party
Information or Proprietary Information of the Company. I further agree that any
property situated on the Company’s premises and owned by the Company, including
disks and other storage media, filing cabinets or other work areas, is subject
to inspection by Company personnel at any time with or without notice.

7. LEGAL AND EQUITABLE REMEDIES. Because my services are personal and unique and
because I may have access to and become acquainted with the Proprietary
Information of the Company, the Company shall have the right to enforce this
Agreement and any of its provisions by injunction, specific performance or other
equitable relief, without bond and without prejudice to any other rights and
remedies that the Company may have for a breach of this Agreement.

8. NOTICES. Any notices required or permitted hereunder shall be given to the
appropriate party at the address specified below or at such other address as the
party shall specify in writing. Such notice shall be deemed given upon personal
delivery, or express mail (e.g., Federal Express) delivery, to the appropriate
address or if sent by certified or registered mail, three (3) days after the
date of mailing.

9. NOTIFICATION OF NEW EMPLOYER. In the event that I leave the employ of the
Company, I hereby consent to the notification of my new employer of my rights
and obligations under this Agreement.

10. GENERAL PROVISIONS.

10.1 Governing Law; Consent to Personal Jurisdiction. This Agreement will be
governed by and construed according to the laws of the State of California, as
such laws are applied to agreements entered into and to be performed entirely
within California between California residents. I hereby expressly consent to
the personal jurisdiction of the state and federal courts located in Alameda
County, California for any lawsuit filed there against me by Company arising
from or related to this Agreement.

10.2 Severability. In case any one or more of the provisions contained in this
Agreement shall, for any reason, be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
the other provisions of this Agreement; this Agreement shall be construed as if
such invalid, illegal or unenforceable provision had never been contained
herein; and such provision shall be construed and modified so as to render it
valid, lawful, and enforceable in a manner consistent with the intent of the
parties to the extent compatible with the applicable law as it shall then
appear.

10.3 Successors and Assigns. This Agreement will be binding upon my heirs,
executors, administrators and other legal representatives and will be for the
benefit of the Company, its successors, and its assigns.

10.4 Survival. The provisions of this Agreement shall survive the termination of
my employment and the assignment of this Agreement by the Company to any
successor in interest or other assignee.

10.5 Employment. I agree and understand that nothing in this Agreement shall
confer any right with respect to continuation of employment by the Company,

 

3.

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nor shall it interfere in any way with my right or the Company’s right to
terminate my employment at any time, with or without cause or advance notice,
which rights are hereby expressly reserved.

10.6 Waiver. No waiver by the Company of any breach of this Agreement shall be a
waiver of any preceding or succeeding breach. No waiver by the Company of any
right under this Agreement shall be construed as a waiver of any other right.
The Company shall not be required to give notice to enforce strict adherence to
all terms of this Agreement.

10.7 Entire Agreement. The obligations pursuant to Sections 1 and 2 (except
Section 2.7) of this Agreement shall apply to any time during which I was
previously engaged, or am in the future engaged, by the Company as a consultant
if no other agreement governs nondisclosure and assignment of inventions during
such period. This Agreement is the final, complete and exclusive agreement of
the parties with respect to the subject matter hereof and supersedes and merges
all prior discussions between us. No modification of or amendment to this
Agreement, nor any waiver of any rights under this Agreement, will be effective
unless in writing and signed by the party to be charged. Any subsequent change
or changes in my duties, salary or compensation will not affect the validity or
scope of this Agreement.

This Agreement shall be effective as of the first day of my employment with the
Company.

I HAVE READ THIS AGREEMENT CAREFULLY, UNDERSTAND ITS TERMS, AND AGREE THERETO. I
HAVE COMPLETELY FILLED OUT EXHIBIT B TO THIS AGREEMENT.

Dated: 11-04-04

 

/s/ Kathryn Olson

(Signature)

Kathryn Olson

(Printed Name)

ACCEPTED AND AGREED TO:

LEAPFROG ENTERPRISES, INC.

 

By:  

/s/ Laura Dillard

Title:   VP, Human Resources

6401 Hollis Street, Suite 100

Emeryville, CA 94608

(Address)

Dated: May 26, 2004

 

4.

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EXHIBIT A

LIMITED EXCLUSION NOTIFICATION

THIS IS TO NOTIFY you in accordance with Section 2872 of the California Labor
Code that the foregoing Agreement between you and the Company does not require
you to assign or offer to assign to the Company any invention that you developed
entirely on your own time without using the Company’s equipment, supplies,
facilities or trade secret information except for those inventions that either:

1. Relate at the time of conception or reduction to practice of the invention to
the Company’s business, or actual or demonstrably anticipated research or
development of the Company; or

2. Result from any work performed by you for the Company.

To the extent a provision in the foregoing Agreement purports to require you to
assign an invention otherwise excluded from the preceding paragraph, the
provision is against the public policy of this state and is unenforceable.

This limited exclusion does not apply to any patent or invention covered by a
contract between the Company and the United States or any of its agencies
requiring full title to such patent or invention to be in the United States.

I ACKNOWLEDGE RECEIPT of a copy of this notification.

 

A-1.

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EXHIBIT B

 

TO:    LEAPFROG ENTERPRISES, INC.       FROM:   

 

   (Employee Name)       DATE:   

 

         SUBJECT:    Previous Inventions         

1. Prior to my engagement by LeapFrog Enterprises, Inc. (the “Company”), I have
¨ have not x made, conceived or reduced to practice, either alone or jointly
with others, inventions or improvements relevant to the subject matter of my
employment by the Company.

(If you checked “have not,” you should not complete any other portion of this
memorandum. If you checked “have,” please complete the remaining sections of
this memorandum.)

2. Except as listed in Section 3 below, the following is a complete list of all
inventions or improvements relevant to the subject matter of my employment by
the Company that have been made or conceived or first reduced to practice by me
alone or jointly with others prior to my engagement by the Company:

 

  

 

 

  

 

 

  

 

 

 

¨ Additional sheets attached.

3. Due to a prior confidentiality agreement, I cannot complete the disclosure
under Section 2 above with respect to inventions or improvements generally
listed below, the proprietary rights and duty of confidentiality with respect to
which I owe to the following party(ies):

 

    

Invention or Improvement

  

Party(ies)

  

Relationship

1.   

 

 

  

 

 

  

 

 

2.   

 

 

  

 

 

  

 

 

3.   

 

 

  

 

 

  

 

 

 

¨ Additional sheets attached.

 

By:  

/s/ Kathryn Olson

  (Employee Signature) Printed Name:   Kathryn Olson Date: 11-04-04

 

B-1.