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 Jeffrey
L. Hale (“Hale”).

 

RECITALS

 

A.                                   Hale has been employed by the Company as
Chief Operating officer since July 13, 2009.

 

B.                                     Hale’s employment at the Company has been
terminated as a result of his voluntary resignation, effective October 13, 2011,
at which time Hale will be relieved of all responsibilities as a Company
employee.

 

C.                                     The parties wish to settle and compromise
fully and finally any and all claims Hale has or purports to have against the
Company and others, including, but not limited to, those arising out of Hale’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.  Hale and the Company agree that Hale’s employment
is terminated as of October 13, 2011 (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.  Hale will be paid all earned wages, accrued but
unpaid benefits relating to vacations, other perquisites, and reimbursements
through the Termination Date within fourteen (14) days from the date hereof.  
In addition, Hale will receive:

 

(a)           For a period of six (6) months following the Termination Date, the
Company shall pay to Hale his base salary annualized at the rate of $275,000 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.

 

(b)           For a period of six (6) months following the Termination Date, the
Company agrees to continue any applicable medical and dental insurance in which
Hale and his dependants, if any, are enrolled on the Termination Date at the
same coverage levels and cost to Hale in effect on the Termination Date.  Hale
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 Hale
cannot continue under the applicable plans after the Termination Date, the
Company will cooperate with Hale to provide coverage pursuant to the
Consolidated Omnibus Budget Reconciliation Act of 1986, as amended (COBRA). 
Notwithstanding the foregoing, during the six (6) 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, Hale becomes covered under another group
health plan, Hale becomes entitled to Medicare benefits (under Part A, Part B,
or both), or the Company ceases to

 

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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 six (6) months following the Termination
Date the premiums for Hale 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 Hale’s 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:  restricted stock grant awarded
March 1, 2011, of which 3,402 shares vested on issue date and 3,402 shares are
scheduled to vest on March 1, 2012 (the “Stock Award”).  Promptly after March 1,
2012, the Company will deliver or cause to be delivered the 3,402 vested shares
under the Stock Award.   All other incentive awards vested as of the Termination
Date held by Hale may be exercised according to their original expiration terms,
and thereafter shall be deemed null and void.  All other unvested incentive
awards and options as of the Termination Date held by Hale will be deemed
terminated and of no further effect.

 

(e)           The Company will provide Hale with twelve (12) months of
executive-level outplacement services from one or more firms chosen by the
Company.

 

(f)  If Hale has not commenced new employment  prior to the expiration of the
six (6) month period referenced in Sections  1 (a) , (b) and (c) above, then
Hale shall notify Mark Strozik, Vice President, Human Resources for  the Company
in writing, at the address set forth in Section 10, that he has not commenced
new employment.  Upon receipt of such written notice, the Company agrees to
continue to provide to Hale for a period of three (3) additional months
(“Enhanced Severance Period”) his: (i) base salary in accordance with Section 1
(a), (ii) pay the Company’s share of his medical and dental benefits in
accordance with Section 1 (b) and pay the premiums on Hale’s life insurance and
disability coverage in accordance with Section 1 (c) above.

 

(g) In consideration of Section 1 (f) above,  Hale covenants and agrees that he
will immediately  notify the Company, in writing, if and when he has begun new
employment at any time  during the Enhanced Severance Period. If Hale begins new
employment during the Enhanced Severance Period then:

 

(i)            Hale’s severance pay set forth in Section 1 (f) (i) will end and
he will be obligated to repay the Company any severance paid by the Company for
periods after Hale began the new employment but before Hale notified the Company
of such new employment; and

 

(ii)           Hale’s continuance in any life, disability, medical and dental
insurance plans shall end when the new employment begins and further, Hale shall
be obligated to repay to the Company  any premiums paid by the Company for life
and

 

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disability coverage and the Company’s share of the cost for the medical and
dental coverage paid after Hale begins  any new employment but before Hale has
notified the Company of his new employment.

 

2.             Severance Consideration.  In consideration for the execution,
delivery, and non-revocation of this Agreement by Hale, the Company will accept
Hale’s voluntary resignation, will provide the consideration set forth in
Section 1 of this Agreement, and shall agree to enter into the Release as set
forth in Section 4 of this Agreement (the “Severance Consideration”).

 

3.             No Entitlement. Hale understands and agrees that he is receiving
this Severance Consideration in exchange for this Release, and Hale 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)           Hale 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 Hale 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 Termination 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 Hale and the Company, all claims arising out of Hale’s separation from
employment, all claims arising from any failure to reemploy Hale, all claims and
damages relating to race, sex, national origin, handicap (disability), religion,
gender identity or expression, sexual orientation and benefits, genetic
information, marital status  and all employment discrimination claims, 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 of 1990, Section 1981 of the
Civil Rights Act of 1866, the Age Discrimination in Employment Act as amended by
the Older Workers Benefit Protection Act, the Equal Pay Act, the Family and
Medical Leave Act, the Worker Adjustment and retraining Notification Act
(“WARN”), the Fair Labor Standards Act, the Employee Retirement Income Security
Act (ERISA), COBRA, Section 806 of the Corporate and Criminal Fraud
Accountability Act of 2002, the Genetic Information Nondiscrimination Act, 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 Rhode
Island Sexual Harassment, Education and Training Act, the Rhode Island Wage
Discrimination Based on Sex Law, the Rhode Island Whistleblowers Protection Act,
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) all wrongful discharge claims, common law tort, defamation, breach of
contract and other

 

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common law claims; (iii) any and all Executive Orders (governing fair employment
practices) which may be applicable to the Company; and (iv) any other provision
or theory of law or equity.  Hale understands and acknowledges that Title VII of
the Civil Rights Act of 1964, ERISA, and state and local civil right laws,
provide Hale the right to bring actions against the Company if, among other
things, Hale 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, Hale 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)           Hale acknowledges and agrees that the consideration he is
receiving under this Agreement is sufficient consideration to support the
release of all entities and persons identified in Section 4 of this Agreement,
and that said consideration is in addition to anything of value to which Hale is
entitled.

 

(d)           Hale 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. Hale further
affirms that he has no known workplace injuries or occupational diseases.

 

(e)           Hale 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. Hale 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 Hale 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 Hale 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, Hale 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, Hale 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, lab top computer, patents, business plans, financial
statements, manuals, memoranda, lists, and other property delivered to or
compiled by Hale 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

 

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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 Hale shall be
delivered promptly to the Company upon the Termination Date.

 

6.             Trade Secrets/Confidentiality.  Hale 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. Hale 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 Hale is required to disclose such
information pursuant to subpoena.  If such information is requested pursuant to
a subpoena, Hale 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 Hale’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 Hale’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 six (6) months from the Termination Date:

 

i.              Hale 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.  Hale
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.             Hale 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;

 

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iii.            Hale 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.            Hale will not call upon any prospective acquisition candidate, on
Hale’s own behalf or on behalf of any person, which candidate was, to Hale’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)           Hale 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 shall be entitled to injunctive relief which may include, but shall
not be limited to, restraining Hale 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 Hale on October 13, 2011.  Hale 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.  Hale 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.             Cooperation.         Hale agrees to fully cooperate with the
Company in the investigation, defense or prosecution of any claims or actions
now in existence or which may be brought in the future against or on behalf of
the Company. Hale’s full cooperation in connection with such claims or actions
shall include, but not be limited to, being available to meet with the Company
counsel to prepare for trial or discovery or an administrative hearing or
alternative dispute resolution and to act as a witness when requested by the
Company at reasonable times designated by the Company. Hale also agrees to
cooperate with the Company in the transitioning of his work and will be
available to the Company for this purpose or any other purpose reasonably
requested by the Company.

 

10.           Revocation Period.  Hale understands that he has a period of seven
(7) days from the date he signs this Agreement to revoke this Agreement, and
that, should he decide

 

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to revoke it within said seven-day period, he shall not be entitled to the
consideration recited herein.  Hale 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 Hale exercising his right
of revocation. Hale agrees that he must provide written notice of revocation of
this Agreement to Mark Strozik, Vice President, Human Resources, Summer Infant
(USA), 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”).

 

11.           Termination of Change of Control Agreement.  The parties hereby
agree that the Change of Control Agreement by and between the Hale and Summer
Infant (USA), Inc. dated as of December, 2009, is terminated effective as of the
Termination Date.

 

12.           Acknowledgement.  Hale 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.

 

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

 

14.           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.

 

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

 

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

 

17.           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.

 

18.           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.

 

19.           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
Hale, and the Company specifically denies the commission of any wrongful acts
against Hale.

 

20.           Non-Disparagement.  Hale 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,

 

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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 Hale.  If the Company’s Human Resources Department is
contacted by prospective employers of Hale, the Company will provide only the
starting and ending dates of Hale’s employment at the Company and the last
position Hale 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.

 

21.           Reservation of Rights to Indemnification and Officer Liability
Insurance for Actions Taken or Omitted While an Officer.  Hale’s right to
indemnification to the fullest extent permitted by Rhode Island 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 Hale in
connection with any proceeding arising by reason of acts taken or omissions to
act occurring while Hale was an officer of the Company, shall continue
unabridged after the Termination Date.

 

22.           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.

 

[Remainder of Page Intentionally Left Blank]

 

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

 

 

 

Summer Infant (USA), Inc.

 

 

 

 

/s/ Jeff Hale

 

By:

/s/ Jason Macari

Jeff Hale

Name:

Jason Macari

 

Title:

President and Chief Executive Officer

 

 

Date:

10/17/2011

 

Date:

October 17, 2011

 

 

 

 

 

 

 

 

Summer Infant, Inc

 

 

 

 

 

By:

/s/ Jason Macari

 

Name:

Jason Macari

 

Title:

President and Chief Executive Officer

 

 

 

Date:

October 17, 2011

 

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