Exhibit 10.30

                               SEVERANCE AGREEMENT

      This Severance Agreement is made and entered into as of January 15, 2000,
by and between Designs, Inc. (the "Company"), a corporation organized and
existing under the laws of Delaware with a principal place of business at 66 B
Street, Needham, Massachusetts 02494, and Carolyn Faulkner ("Faulkner"), an
individual residing at 252 Main Street, West Newbury, Massachusetts 01985.

      WHEREAS, the Company and Faulkner are parties to an Employment Agreement
dated as of May 9, 1997 (the "Employment Agreement") whereby Faulkner was
employed as Vice President and Chief Financial Officer of the Company, which
agreement expires May 8, 2000; and

      WHEREAS, the Company and Faulkner agree to terminate the Employment
Agreement on the terms and conditions hereinafter set forth and establish the
terms of Faulkner's severance arrangement.

      NOW THEREFORE, in consideration of the promises and conditions set forth
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:

      1. Resignation. In consideration of the terms and conditions of this
Severance Agreement, Faulkner hereby tenders her resignation to the Company
effective as of January 15, 2000 (the "Resignation Date"), and the Company
accepts her resignation to be effective on the Resignation Date. From and after
the Resignation Date, Faulkner shall no longer be an employee of the Company and
shall have no further duties or responsibilities on behalf of the Company except
as provided herein.

      2. Severance Payments. The Company shall pay Faulkner the aggregate sum of
Four Hundred Twenty Thousand Dollars and No Cents ($420,000.00) (the "Severance
Payment"), in accordance with the attached Payment Schedule. Payments shall be
made by direct deposit to Faulkner's account and are deemed paid on the date the
deposits are
<PAGE>

made. Faulkner shall be liable for, and shall pay in full when due, any and all
local, state and federal income taxes related to the Severance Payment. Faulkner
will receive a Form 1099 from the Company at the end of each calendar year.

      3. Medical/Dental Insurance. To the extent participation is permitted by
the terms of the applicable insurance policies and plans, the Company shall
continue to provide Faulkner with family medical and dental insurance coverage
through July 31, 2000, on the same terms and conditions that it provides such
coverage to its employees. Thereafter, Faulkner shall be entitled to apply for
and receive continuation of medical insurance coverage at her sole cost and
expense until January 31, 2002, consistent with and subject to the provisions of
COBRA. While under COBRA an employee who terminates employment generally is
eligible to elect to continue his or her health coverage for up to 18 months
from either the employment termination date or, as here, the date of loss of
coverage if later, Faulkner and the Company acknowledge that there are
exceptions under COBRA to this general rule. Faulkner's current costs for the
family medical and dental insurance coverage for the period from January 15,
2000 until July 31, 2000 is set forth on the attached Payment Schedule and the
costs shall be deducted from the Severance Payment due to Faulkner from the
Company. In the event Faulkner is employed by any person or entity after the
Resignation Date, she shall obtain family medical and dental insurance coverage
through her new employer as soon as possible under the terms of the applicable
plans and the Company shall be released from its obligations under this section
to provide any such coverage, including coverage pursuant to COBRA. Faulkner
shall notify the Company of the commencement of such new coverage within 10 days
of the commencement date.

      4. Vehicle. Faulkner may retain possession of the 1997 BMW 528 vehicle
currently leased by the Company and used by Faulkner for the remainder of the
original lease term, which expires in July 2000. The Company shall continue to
pay the lease payments and insurance costs on the vehicle until the expiration
of the original lease term. However, after the Resignation Date, Faulkner shall
be responsible for, at her sole cost and expense, all operating, repair and
maintenance costs and any other costs related to the use and operation of the
vehicle. Upon expiration of the lease, Faulkner shall have the option of
purchasing the vehicle pursuant to the terms of the lease, if permitted under
the lease,


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<PAGE>

and shall pay all costs related to the purchase. In the event Faulkner does not
purchase the vehicle upon expiration of the lease, she shall immediately return
the vehicle to the lessor in good repair and condition, normal wear and tear
excepted. Any and all security deposits shall remain the property of the Company
and shall be returned to the Company upon expiration of the lease. With the
exception of the monthly lease payments, upon expiration of the vehicle lease,
Faulkner shall pay any and all costs due to the lessor.

      5. Benefits and Perquisites. The Company shall reimburse Faulkner for all
business and automobile repair and gasoline expenses reasonably incurred by her
through the Resignation Date in connection with her work as an employee of the
Company, including without limitation all travel expenses, in accordance with
the Company's policies applicable to its senior executives and upon submission
of appropriate documentation thereof.

      6. Legal Fees. In the event either party breaches any such party's
obligations under this Severance Agreement, the non-breaching party shall be
entitled to recover all reasonable costs incurred by such non-breaching party in
enforcing the terms of the Severance Agreement, including reasonable attorneys'
fees. The prevailing party shall be entitled to recover its reasonable
attorney's fees and expenses in any litigation that arises out of or relates to
this Severance Agreement.

      7. Options. Faulkner hereby acknowledges and agrees that any and all
incentive stock options, non-qualified stock options and/or any other stock
options granted to her during her employment at the Company shall expire and/or
terminate as of the Resignation Date.

      8. Continued Cooperation. Without further consideration, Faulkner agrees
that she shall be reasonably available upon request to consult with and assist
the Company in the current Internal Revenue Service Audits, which shall include
but is not limited to testifying at any deposition, hearing, proceeding or trial
and meeting with representatives of the Company and/or Internal Revenue Service
to discuss the factual history of such matters, and assist in connection with
the transition of other financial matters, provided that Faulkner shall not be
required to devote a major portion of her time to such services and such
services shall not unreasonably interfere with the performance of other
employment or consulting duties Faulkner may have.


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<PAGE>

      9. References. All responses to any inquiries made to the Company or to
any agent or consultant for the Company regarding employment references for
Faulkner shall be limited to providing dates of employment, title and salary
information. If additional information is requested, the Company may state that
the foregoing information is the only information that the Company can provide
or words to that effect.

      10. Non-disparagement. Faulkner agrees that she will not make any public
or private statement which criticizes or disparages the Company or its officers,
directors, employees or consultants and will use her best efforts to have her
agents comply with this provision.

      11. Confidentiality. Faulkner agrees that she will treat the terms and
conditions of this Severance Agreement as confidential and that she will not
disclose said terms and conditions to any person or entity, except to her
immediate family, as required by law, to enforce the terms hereof and/or as
necessary to her personal financial and legal advisors. In the event Faulkner
discloses any of the terms and conditions of this Severance Agreement to any of
the foregoing persons or entities, she shall advise them that the terms and
conditions of this Severance Agreement are confidential and that they shall not
be disclosed to any other person or entity. Faulkner acknowledges and agrees
that the disclosure of this Severance Agreement and/or the material terms
thereof will likely be required by the Company in its filings with the
Securities and Exchange Commission.

      12. Non-Disclosure.

            (a) Faulkner agrees that she will not disclose to any person or
      entity, either orally or in written form, except as required by law, any
      confidential information relating to the Company or any of its
      subsidiaries and affiliates, the directors of the Company or its
      subsidiaries and affiliates, any client of the Company or any of its
      subsidiaries and affiliates, or any corporation, partnership or other
      entity owned or controlled, directly or indirectly, by any of the
      foregoing, or in which any of the foregoing has a beneficial interest,
      including, but not limited to, the business affairs of each of the
      foregoing. Such confidential information shall include, but shall not be
      limited to, proprietary technology, trade secrets, patented processes,
      research and development data, know-how, market studies and forecasts,
      competitive analyses, pricing policies, employee lists, personnel
      policies, the


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<PAGE>

      substance of agreements with customers, suppliers and others, marketing or
      dealership arrangements, servicing and training programs and arrangements,
      customer lists and any other documents, including copies of such
      information in electronic form, embodying such confidential information.

            (b) The non-disclosure obligation set forth above shall not apply to
      any information (i) which was in the public domain at the time of
      disclosure or (ii) which thereafter fell into the public domain without
      any fault of Faulkner and which was not disclosed in violation of any
      similar non-disclosure obligation by any other person.

            (c) On or before the Resignation Date, Faulkner shall leave with the
      Company all documents, computer disks, records, reports, writings and
      other similar documents containing confidential information, including
      copies thereof then in Faulkner's possession or control, except those
      documents which are Faulkner's personal copies of documents relating to
      the terms and conditions of her employment with or resignation from the
      Company. Faulkner represents that, as of the Resignation Date, she has
      returned to the Company all other assets and/or property belonging to the
      Company.

      13. Non-Competition and Non-Solicitation.

            (a) Faulkner agrees that during the period commencing on the
      Resignation Date and ending on January 31, 2002, she shall not work for
      Levi Strauss & Co., and she shall not, directly or indirectly, as owner,
      partner, joint venturer, stockholder, employee, broker, agent, principal,
      trustee, corporate officer, director, licensor, or in any capacity
      whatsoever, engage or assist any person or entity to engage in the Levi's
      or Dockers outlet business in any location in any geographic area in the
      United States or Puerto Rico; provided, however, that Faulkner may own any
      securities of any corporation which is engaged in such business and is
      publicly owned and traded but in an amount not to exceed at any one time
      one percent (1%) of any class of stock or securities of such corporation.

            (b) During the period commencing on the Resignation Date and ending
      on January 31, 2002, Faulkner shall not request any suppliers or customers
      with whom the Company has a business relationship to cancel or terminate
      any such


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<PAGE>

      business relationship with the Company or solicit any employee of the
      Company to leave the Company's employ. Notwithstanding the foregoing,
      nothing contained herein shall constitute the Company's approval or
      acquiescence of any actions taken by Faulkner after January 31, 2002 to
      seek to cause the cancellation or termination of any business relationship
      between the Company and any third party and the Company reserves the right
      to assert claims against Faulkner arising out of her conduct.

      14. Faulkner Release. Faulkner hereby voluntarily and irrevocably releases
and forever discharges the Company and its subsidiaries (including their
successors and assigns) and each of their current and former officers,
directors, shareholders, employees, consultants, representatives and agents
(hereinafter the "Company Releasees") from any and all charges, complaints,
claims, promises, agreements, actions, obligations, causes of action, damages,
and debts (including attorneys' fees and costs actually incurred), known or
unknown, which Faulkner has, had, or hereinafter may have, directly or
indirectly, from the beginning of the world to the day of the date of this
Severance Agreement, including, without limitation, all claims related to or
arising out of any conduct pertaining to the most recent proxy contest, consent
solicitation and/or annual meeting of the Company, all claims related to or
arising out of her employment with or services performed for the Company, all
claims for breach of contract, all claims arising out of or relative to
Faulkner's employment with the Company and the termination thereof and any
claims Faulkner may have under the Employment Agreement, all claims for breach
of an implied covenant of good faith and fair dealing, all claims for
intentional or negligent misrepresentation, all claims relating to any acts or
omissions by the Company Releasees, and all claims for unlawful discrimination
under the common law or any statute (including, without limitation, Title VII of
the Civil Rights Act of 1964, 42 U.S.C. ss.2000e, et seq., the Age
Discrimination in Employment Act of 1967, 29 U.S.C.ss.621, et seq., the Employee
Retirement Income Security Act, 29 U.S.C.ss.1001, et seq, and the Americans with
Disabilities Act of 1990, 42 U.S.C.ss.12101, et seq.) Notwithstanding the
foregoing, this release shall not release or limit Faulkner's rights to
indemnification under the terms of the By-Laws of the Company and under the
Indemnification Agreement between Faulkner and


                                       6
<PAGE>

the Company dated as of December 10, 1998, as in effect on the date hereof, or
to enforce this Severance Agreement or bring claims for breach thereof.

      15. Company Release. The Company, on behalf of itself and its officers,
directors, agents, representatives, subsidiaries, consultants and shareholders
(hereinafter the "Company Releasors") hereby voluntarily and irrevocably
releases and forever discharges Faulkner and her heirs and survivors from any
and all charges, complaints, claims, promises, agreements, obligations, causes
of action, damages and debts, (including attorneys' fees and costs actually
incurred), known or unknown, that the Company Releasors, individually or
jointly, have, had or hereinafter may have, directly or indirectly, from the
beginning of the world to the day of the date of this Severance Agreement,
including, without limitation, all claims for breach of contract, relating to or
arising out of any conduct pertaining to the most recent proxy contest, consent
solicitation and/or annual meeting of the Company or relating to or arising out
of Faulkner's employment with or services performed for the Company, all claims
for breach of an implied covenant of good faith and fair dealing, all claims for
intentional or negligent misrepresentation, mismanagement, nondisclosure, or any
acts or omissions by Faulkner during the course of her employment or any claims
the Company may have under the Employment Agreement. Notwithstanding the
foregoing, this release shall not release or limit the Company's rights to
enforce this Severance Agreement or to bring any claims for breach thereof.

      16. Arbitration of Disputes. Any controversy or claim arising out of or
relating to this Severance Agreement or the breach thereof shall, to the fullest
extent permitted by law, be settled by arbitration in any forum and form agreed
upon by the parties or, in the absence of such an agreement, under the auspices
of the American Arbitration Association ("AAA") in Boston, Massachusetts, in
accordance with the rules of the AAA, including, but not limited to, the rules
and procedures applicable to the selection of arbitrators. Judgment upon the
award rendered by the arbitrator may be entered in any court having jurisdiction
thereof. This Section 16 shall be specifically enforceable. Notwithstanding the
foregoing, this Section 16 shall not preclude either party from pursuing a court
action for the sole purpose of obtaining a temporary restraining order or a
preliminary injunction in circumstances in which such relief is appropriate;
provided, however, that any other relief shall be pursued through an arbitration
proceeding pursuant to this Section 16.


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<PAGE>

      17. Trust Agreement. Faulkner hereby relinquishes any and all rights,
title and interest that she had, has or may have in, arising out of or relating
to the Trust Agreement ("Trust Agreement") made as of May 12, 1999 by and
between the Company and State Street Bank and Trust Company ("State Street") or
the assets held thereunder. Faulkner agrees and consents to the termination of
the Trust Agreement and the return of all trust assets by State Street to the
Company and shall execute any and all documents necessary to accomplish the
termination and return of trust assets. If Faulkner fails to execute the
foregoing documents within forty eight (48) hours after receipt of a written
request from the Company, the Company can suspend the payments of the Severance
Payment until Faulkner executes such documents. Notwithstanding the foregoing,
this provision shall not release or limit Faulkner's rights to indemnification
under the terms of the By-Laws of the Company and under the Indemnification
Agreement between Faulkner and the Company dated as of December 10, 1998, as in
effect on the date hereof.

      18. Nature of Agreement. Faulkner and the Company acknowledge and agree
that this Severance Agreement is a severance and settlement agreement and shall
not constitute an admission of liability and wrongdoing on the part of either
party.

      19. Notices. All notices, requests, demands, and other communications
provided for by this Severance Agreement shall be sufficient if in writing and
delivered in person or sent by registered or certified mail, postage prepaid, to
the other party at the address first above written, or at such other address as
to which the party gives notice, with a copy to:

      For the Company:  Designs, Inc.
                        66 B Street
                        Needham, MA 02494
                        Attention: Corporate Counsel
                              and
                        Peter Smith, Esq.
                        Kramer Levin Naftalis & Frankel LLP
                        919 Third Avenue
                        New York, NY 10022-39903

      For Faulkner:     Sandra Sue McQuay, Esq.
                        Sullivan Weinstein & McQuay
                        Two Park Place
                        Boston, MA 02116


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<PAGE>

      20. Entire Agreement. This Severance Agreement is the entire agreement
between the parties relating to the subject matter hereof. The Employment
Agreement shall terminate effective as of January 15, 2000, at which time it
shall become null and void.

      21. Voluntary Assent. Faulkner and the Company affirm that no other
promises or agreements of any kind have been made to or with them by any person
or entity whatsoever to cause them to sign the Severance Agreement, and that
they fully understand the meaning and intent of this Severance Agreement.
Faulkner and the Company state and represent that they have had an opportunity
to fully discuss and review the terms of this Severance Agreement with an
attorney, that they have read this Severance Agreement carefully and understand
the contents hereof, that they freely and voluntarily assent to all of the terms
and conditions hereof and that they sign their name of their own free act.

      22. Binding Effect. This Severance Agreement shall inure to the benefit of
and be binding upon the Company and Faulkner, their respective successors,
executors, administrators, heirs and permitted assigns.

      23. Amendment. This Severance Agreement may be amended or modified only by
a written instrument signed by Faulkner and a duly authorized representative of
the Company.

      24. Severability. In case any provisions of this Severance Agreement shall
be determined by an arbitrator or court of competent jurisdiction to be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions of this Severance Agreement shall not in any way be
affected or impaired thereby.

      25. Future Cooperation. At any time after execution and exchange of this
Severance Agreement and from time to time, Faulkner and the Company, upon
written request from either party to the other, shall execute and deliver such
further documents or instruments as may be reasonably necessary to more fully
effectuate the intention of the parties hereto but limited to such
amplification, definition or effectuation strictly consistent with the terms and
provisions hereof.

      26. Applicable Law. This Severance Agreement shall be governed by the laws
of the Commonwealth of Massachusetts.


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<PAGE>

      27. Opportunity to Consider; Revoke. Faulkner acknowledges that she has
been afforded an opportunity to take at least twenty-one (21) days to consider
this Severance Agreement and has been advised to consult with the attorneys of
her choice prior to executing this Severance Agreement. Faulkner acknowledges
that she has had an adequate opportunity to review this Severance Agreement
before its execution. The parties understand and acknowledge that Faulkner will
have a period of seven (7) calendar days following her execution of this
Severance Agreement in which to revoke her consent to this Severance Agreement.
Such revocation must be in writing and shall be transmitted to the Company such
that it is actually received prior to the expiration of the seven-day revocation
period.

      28. Counterparts. This Severance Agreement may be executed in two (2)
signature counterparts, each of which shall constitute an original, but all of
which taken together shall constitute one and the same instrument.

Executed as a sealed document as of the date and year first written above.

DESIGNS, INC.


By: /s/ John J. Schultz                         /s/ Carolyn Faulkner
Its: Chief Executive Officer                    Carolyn Faulkner
Hereunto duly authorized


By: /s/ Jeffrey M. Unger
Its: Vice President of Corporate Development
Hereunto duly authorized


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<PAGE>

                   Carolyn Faulkner Severance Payment Schedule

                    Payment           Insurance Deduction      BI-Weekly Payment
   28-Jan    2000     $  8,400.00        $      124.20          $     8,275.80
    4-Feb    2000     $  8,400.00        $       90.45          $     8,309.55
   18-Feb    2000     $  8,400.00        $       90.45          $     8,309.55
    3-Mar    2000     $  8,400.00        $       90.45          $     8,309.55
   17-Mar    2000     $  8,400.00        $       90.45          $     8,309.55
   31-Mar    2000     $  8,400.00                               $     8,400.00
   14-Apr    2000     $  8,400.00        $       90.45          $     8,309.55
   28-Apr    2000     $  8,400.00        $       90.45          $     8,309.55
   12-May    2000     $  8,400.00        $       90.45          $     8,309.55
   26-May    2000     $  8,400.00        $       90.45          $     8,309.55
    9-Jun    2000     $  8,400.00        $       90.45          $     8,309.55
   23-Jun    2000     $  8,400.00        $       90.45          $     8,309.55
    7-Jul    2000     $  8,400.00        $       90.45          $     8,309.55
   21-Jul    2000     $  8,400.00        $       90.45          $     8,309.55
    4-Aug    2000     $  8,400.00                               $     8,400.00
   18-Aug    2000     $  8,400.00                               $     8,400.00
    1-Sep    2000     $  8,400.00                               $     8,400.00
   15-Sep    2000     $  8,400.00                               $     8,400.00
   29-Sep    2000     $  8,400.00                               $     8,400.00
   13-Oct    2000     $  8,400.00                               $     8,400.00
   27-Oct    2000     $  8,400.00                               $     8,400.00
   10-Nov    2000     $  8,400.00                               $     8,400.00
   24-Nov    2000     $  8,400.00                               $     8,400.00
    8-Dec    2000     $  8,400.00                               $     8,400.00
   22-Dec    2000     $  8,400.00                               $     8,400.00
    5-Jan    2001     $  8,400.00                               $     8,400.00
   19-Jan    2001     $  8,400.00                               $     8,400.00
    2-Feb    2001     $  8,400.00                               $     8,400.00
   16-Feb    2001     $  8,400.00                               $     8,400.00
    2-Mar    2001     $  8,400.00                               $     8,400.00
   16-Mar    2001     $  8,400.00                               $     8,400.00
   30-Mar    2001     $  8,400.00                               $     8,400.00
   13-Apr    2001     $  8,400.00                               $     8,400.00
   27-Apr    2001     $  8,400.00                               $     8,400.00
   11-May    2001     $  8,400.00                               $     8,400.00
   25-May    2001     $  8,400.00                               $     8,400.00
    8-Jun    2001     $  8,400.00                               $     8,400.00
   22-Jun    2001     $  8,400.00                               $     8,400.00
    6-Jul    2001     $  8,400.00                               $     8,400.00
   20-Jul    2001     $  8,400.00                               $     8,400.00
    3-Aug    2001     $  8,400.00                               $     8,400.00
   17-Aug    2001     $  8,400.00                               $     8,400.00
   31-Aug    2001     $  8,400.00                               $     8,400.00
   14-Sep    2001     $  8,400.00                               $     8,400.00
   28-Sep    2001     $  8,400.00                               $     8,400.00
   12-Oct    2001     $  8,400.00                               $     8,400.00
   26-Oct    2001     $  8,400.00                               $     8,400.00


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<PAGE>

    9-Nov    2001     $  8,400.00                               $     8,400.00
   23-Nov    2001     $  8,400.00                               $     8,400.00
    7-Dec    2001     $  8,400.00                               $     8,400.00

Total                 $420,000.00        $    1,209.60          $   418,790.40


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