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**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington,D.C. 20549**

 

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**FORM 10-K/A**

**(AmendmentNo. 1)**

 
| **x**      | ** ** | **Annual report pursuant to  Section 13 or 15(d) of the Securities Exchange Act of 1934**                                                                                       |
|------------|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ** ** | ** ** | **For the  fiscal year ended December 31, 2008**                                                                                                                                     |
| **o**      | ** ** | **Transition report pursuant to  Section 13 or 15(d) of the Securities Exchange Act of 1934**                                                                                   |
| ** ** | ** ** | **For the  transition period from                to            ** |

**CommissionFile No. 001-33346**

 

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**SUMMER INFANT, INC.**

 

| **Delaware**                                        |   | **20-1994619**                        |
|-----------------------------------------------------|--------|---------------------------------------|
| (State or other jurisdiction  of incorporation)     |   | (I.R.S. Employer  Identification No.) |
|                                                |   |                                  |
| **1275 Park East Drive, Woonsocket, Rhode  Island** |   | **02895**                             |
| (Address of Principal Executive Offices)            |   | (Zip Code)                            |

 

**(401)671-6550**

(Registrant’s Telephone Number, IncludingArea Code)

 

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**Securitiesregistered pursuant to Section 12(b) of the Act:**

 

| **Title  of each class**       | ** ** | **Name  of Exchange on which registered** |
|--------------------------------|------------|-------------------------------------------|
| Common Stock, Par Value $.0001 |       | Nasdaq Capital Market                     |

 

**Securitiesregistered pursuant to Section 12(g) of the Act:**

**None**

 

Indicate by check mark if the registrant is a well-known seasonedissuer, as defined in Rule 405 of the Securities Act. YES o    NOo

 

Indicate by check mark if the registrant is not required to filereports pursuant to Section 13 or Section 15(d) of the Act. YES o    NOx

 

Indicate by check mark whether the registrant: (1) has filed allreports required to be filed by Section 13 or 15(d) of the SecuritiesExchange Act of 1934 during the preceding 12 months (or for such shorter periodthat the registrant was required to file such reports), and (2) has beensubject to such filing requirements for the past 90 days. YES x    NOo

 

Indicate by check mark if disclosure of delinquent filers pursuant toItem 405 of Regulation S-K is not contained herein, and will not becontained, to the best of registrant’s knowledge, in definitive proxy orinformation statements incorporated by reference in Part III of this Form 10-Kor any amendment to this Form 10-K. o

 

Indicate by check mark whether the registrant is a large acceleratedfiler, an accelerated filer, a non-accelerated filer or a smaller reportingcompany. See the definitions of “accelerated filer,” large accelerated filer”and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer  o    Acceleratedfiler  o

Non-accelerated filer  o        Smaller reporting company   x

 

Indicate by check mark whether registrant is a shell company (asdefined in Rule 12b-2 of the Exchange Act). YES o    NOx

 

The aggregate market value of the voting and non-voting common equityheld by non-affiliates computed by reference to the price at which the commonequity was sold, or the average bid and asked price of such common equity, asof December 31, 2008 approximately $23,600,000.

 

The number of shares outstanding of the registrant’s common stock asof  March 25, 2009was 15,404,782.

 

**DOCUMENTS INCORPORATED BY REFERENCE**

 

None.

 

 

 

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**INDEX TO FORM 10-K/A**

**FOR THEFISCAL YEAR ENDED DECEMBER 31, 2008**

 
| ** **        | ** **                                                                                      | **PAGE**   |
|-------------------|-------------------------------------------------------------------------------------------------|------------|
|              |                                                                                            |       |
| Explanatory  Note |                                                                                            | 1          |
|              |                                                                                            |       |
| **PART III** | ** **                                                                                      | ** ** |
|              |                                                                                            |       |
| ITEM 10.     | Directors, Executive Officers of the Registrant and Corporate  Governance                       | 2          |
|              |                                                                                            |       |
| ITEM 11.     | Executive Compensation                                                                          | 10         |
|              |                                                                                            |       |
| ITEM 12.     | Security Ownership of Certain Beneficial  Owners and Management and Related Stockholder Matters | 17         |
|              |                                                                                            |       |
| ITEM 13.     | Certain Relationships, Related Transactions  and Director Independence                          | 19         |
|              |                                                                                            |       |
| ITEM 14.     | Principal  Accounting Fees and Services                                                         | 20         |
|              |                                                                                            |       |
| **PART IV**  | ** **                                                                                      | ** ** |
|              |                                                                                            |       |
| ITEM 15.     | Exhibits,  Financial Statement Schedules                                                        | 22         |
|              |                                                                                            |       |
| **SIGNATURES**    | ** **                                                                                      | **22**     |

 

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**EXPLANATORY NOTE**

 

SummerInfant, Inc. (referred to as the company, we, us or our) is filing thisAmendment No. 1 on Form 10-K/A (this “Amendment”) to its Annual Reporton Form 10-K for the year ended December 31, 2008, originally filedon March 25, 2009 (the “Original Report”), for the sole purpose ofincluding the information required by Part III of Form 10-K.Accordingly, Items 10, 11, 12, 13 and 14 of Part III of our OriginalReport are replaced in their entirety with the information provided herein.This Form 10-K/A does not amend, update or change any other items ordisclosure in the Original Report or reflect events that occurred after thedate of the Original Report. Therefore, this Amendment should be read inconjunction with our Original Report and our other filings made with the UnitedStates Securities and Exchange Commission (“SEC”) subsequent to the filing ofthe Original Report.

 

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**PART III**

 

**Item 10. Directors, Executive Officers and CorporateGovernance**

 

Pursuant to our Amended and Restated Certificate ofIncorporation, our Board of Directors is divided into three classes.  The terms of current Class A directorsMyra Hart and Robert Stebenne will expire at the annual meeting of stockholdersto be held in 2011.  The terms of currentClass B directors Steven Gibree, Martin Fogelman and Richard Wenz willexpire at the at the annual meeting of stockholders to be held in 2009.  The terms of current Class C director,Jason Macari, expires at the annual meeting of stockholders to be held in 2010.

 

Based on its review of the relationships between its existing directorsand our company and our subsidiaries, our Board of Directors has affirmativelydetermined that a majority of our directors are independent under the rules ofthe Nasdaq Stock Market.

 

On March 6, 2007, under an Agreement and Plan of Reorganization,dated as of September 1, 2006, we acquired Summer Infant, Inc. (“SummerPredecessor”), through the merger of our acquisition subsidiary and SummerPredecessor.  Prior to the merger, wewere referred to as KBL Healthcare Acquisition II, Inc. (“KBL”).  Effective upon closing this merger, wechanged our name to Summer Infant, Inc. Upon completion of the merger, our Board of Directors was increased toseven members.  Two persons who weredesignated by the former stockholders of Summer Predecessor, Jason P. Macariand Steven Gibree, were added to our Board of Directors.  Two persons, Marlene Krauss and MartinFogelman, were designated by certain of our founding stockholders.  The other three members of our Board ofDirectors, Myra Hart, Robert Stebenne and Richard Wenz, were mutuallydesignated by these founding stockholders and by these former SummerPredecessor stockholders.  Ms. Kraussresigned from the Board of Directors in 2008 and her seat on the Board ofDirectors will be filled at the Company’s 2010 Annual Meeting when it comes upfor election.  These stockholders haveentered into a voting agreement with respect to the election of directors.  See “Voting Agreement” below.

 

##### ***Board of Directors***

##### ** **

The following table sets forthcertain information with respect to our Board of Directors, their principaloccupations, ages, independence status, as determined in accordance with rules ofthe Nasdaq Stock Market, and periods of service on our Board of Directors.  Information regarding their ownership ofshares of our common stock as of April 27, 2009 may be found at “*Security Ownership of Certain Beneficial Owners and Management*.”

 
| **Class** | ** ** | **Name**             | ** ** | **Age** | ** ** | **Principal  Occupation**                   | ** ** | **Independent  Status** | ** ** | **Director  Since** | ** ** | **Term of  Office Will  Expire** | ** ** |
|-----------|------------|----------------------|------------|---------|------------|---------------------------------------------|------------|-------------------------|------------|---------------------|------------|--------------------------------------------|------------|
| A         |       | Myra Hart  (1)       |       | 68      |       | Consultant                                  |       | Y                       |       | March 2007     |       | 2011                                       |       |
| A         |       | Robert  Stebenne (2) |       | 55      |       | Owner, Bob  Stebenne Associates             |       | Y                       |       | March 2007     |       | 2011                                       |       |
| B         |       | Steven  Gibree (3)   |       | 42      |       | EVP of Prod.  Dev. Summer Infant, Inc. |       | N                       |       | March 2007     |       | 2009                                       |       |
| B         |       | Martin  Fogelman (4) |       | 65      |       | Indep.  Consultant Baby Prod. Industry      |       | Y                       |       | March 2007     |       | 2009                                       |       |
| B         |       | Richard Wenz  (5)    |       | 59      |       | Consultant  /Private Investor               |       | Y                       |       | March 2007     |       | 2009                                       |       |
| C         |       | Jason Macari  (6)    |       | 46      |       | CEO, Summer  Infant, Inc.              |       | N                       |       | March 2007     |       | 2010                                       |       |

 

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(1)           Dr. Hart serves on the seniorfaculty of Harvard Business School where she taught entrepreneurship from July 1995to 2007.  From 1990 to 1995, she was afull-time doctoral candidate at Harvard University. From 1985 until 1990, Ms. Hartwas a member of the founding team of Staples, Inc. where she was vicepresident of growth and development.  Ms. Hartis a Director of Office Depot, Inc. (ODP:NYSE), Kraft Foods Inc.(KFT:NYSE), and Nina McLemore Inc., a privately held company.  She is a director of the Center for Women’sBusiness Research, a Trustee of Babson College, and a Presidential Councillorof Cornell University. Ms. Hart received a B.A. from Cornell Universityand MBA and DBA from Harvard University.

 

(2)           Mr. Stebenne currently owns andmanages Bob Stebenne Associates, a firm that provides consulting services inthe areas of brand development, product development and strategic planning, amongother areas.  Mr. Stebenne foundedthe firm in 2002.  Prior to that time,from February 1999 to July 2002, Mr. Stebenne was the presidentof new business development for Hasbro Industries.  From 1991 to January 1999, he waspresident of Hasbro’s FOB/LC division, where he created a U.S. marketing,sales, product development, finance and logistics group.  From 1982 to 1991, he was president of Hasbro’sPlayskool Baby division.

 

(3)           Mr. Gibree is our executive vicepresident of product development with management oversight of research anddevelopment, product design and engineering and manufacturing relations.  Prior to March 2007, Mr. Gibreeheld these same positions at Summer Predecessor, with whom he had been employedsince November 2001.  Prior to thattime, Mr. Gibree was the vice president of engineering for Little Kids, Inc.,a manufacturer of innovative toys, from March 2001 to November 2001.From May 1997 to March 2001, Mr. Gibree was director ofengineering at Safety 1st, Inc. From May 1985 to May 1997, Mr. Gibree was employed byHasbro, rising to project manager for the Kid Dimension Division.

 

(4)           Mr. Fogelman has been anindependent consultant to the baby products industry since April 2007.  From May 2003 until March 2007, Mr. Fogelmanwas President of Baby Trend, Inc., a manufacturer of infant products.  From 1983 to April 2003, he was seniorvice president and general merchandise manager of both Toys *R* Us, a leading retailer of children’stoys, and Babies *R* Us juvenileproducts division, a leading retailer of products for infants and toddlers.

 

(5)           Mr. Wenz is a consultant andprivate investor and currently serves on the Board of Directors of CoachAmerica, Inc., Strategic Partners, Inc. and Easton Bell Sports, Inc.  From October 2000 to July 2003, Mr. Wenzwas an operating partner/affiliate of DB Capital Partners, the private equityarm of Deutsche Bank A.G. and served on the board of directors of a number ofportfolio companies, including NewRoads, Inc. and Jenny CraigInternational.  Mr. Wenz also servedas chief executive officer of Jenny Craig International from March 2002 toJanuary 2003.  Mr. Wenz waspresident and chief operating officer of Safety 1st, from February 1997 toMay 2000. During 1995 and 1996, Mr. Wenz was the partner in charge ofthe Chicago office with The Lucas Group, a business strategy consulting firm.Prior to 1995, Mr. Wenz held senior executive positions with WilsonSporting Goods Co., Electrolux Corporation, The Regina Company and ProfessionalGolf Corporation. Mr. Wenz began his career in 1971 with Arthur Young &Company (predecessor of Ernst & Young) and left the firm as a partnerin 1983.  Mr. Wenz is a certifiedpublic accountant.

 

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(6)           Mr. Macari has been our ChiefExecutive Officer and a director since March 2007.  Prior to March 2007, Mr. Macari wasChief Executive Officer and founder of Summer Predecessor, which he founded in2001.  Prior to that time, Mr. Macariwas vice president of product development and general manager of Safety 1st, Inc.,a leading manufacturer of safety and baby products from August 1994 to June 2001.From May 1988 to August 1994, Mr. Macari managed themanufacturing engineering group of the Davol Division of CR Bard, amanufacturer of surgical products.

 

##### **Board of Directors Meetings and Committees of the Board**

##### ** **

*Attendanceof Directors*

 

In 2008, four meetings ofour Board of Directors were held.  All directorsattended more than seventy-five percent of the meetings.  All directors attended in excess of 75% ofthe meetings of the committees of our Board of Directors on which they served.  Our directors are encouraged, but notrequired, to attend annual meetings.

 

*Compensationof Directors*

 

We do not pay our directors who are also executive officers anyadditional compensation for service as directors.

 

In 2008, the compensation for non-employee directors included thefollowing:

 
| · |   | Cash Board of Directors meeting attendance fee  of $1,000 per meeting attended in person and $500 for each meeting by  telephone;                                                                            |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                         |
| · |   | Cash meeting attendance fee of $1,000 for each  meeting of the Audit Committee and $500 for each meeting of any other  committee of our Board of Directors;                                                  |
|   |   |                                                                                                                                                                                                         |
| · |   | $10,000 annual retainer for all directors;                                                                                                                                                                   |
|   |   |                                                                                                                                                                                                         |
| · |   | $5,000 annual retainer for the Chairman of the  Audit Committee;                                                                                                                                             |
|   |   |                                                                                                                                                                                                         |
| · |   | $2,500 annual retainer for the Chairman of any  other committee of our Board of Directors;                                                                                                                   |
|   |   |                                                                                                                                                                                                         |
| · |   | $1,500 annual retainer for other members of  the committees of our Board of Directors;                                                                                                                       |
|   |   |                                                                                                                                                                                                         |
| · |   | Expense reimbursement for all reasonable  expenses incurred in attending meetings and tending to our business; and                                                                                           |
|   |   |                                                                                                                                                                                                         |
| · |   | In 2007, there was a grant of 40,000 stock  options under the 2006 Performance Equity Plan to each director, which vested  25% on the date of grant and 25% annually on each anniversary of the grant  date. |

 

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The following table shows non-employee director compensation in 2008:

 
| **Name (1)** | ** ** | **Fees  Earned  or  Paid in  Cash  ($)** | ** ** | **Stock  Awards  ($)** | ** ** | **Options  Awards  ($) (2)** | ** ** | **Non-Equity  Incentive Plan  Compensation  Earnings** | ** ** | **Change in  Pension  Value and  Non-qualified  Deferred  Compensation  Earnings** | ** ** | **All Other  ($)** | ** ** | **Total ($)** | ** ** |
|-------------------|------------|-----------------------------------------------|------------|------------------------|------------|-----------------------------------|------------|-------------------------------------------------------------|------------|----------------------------------------------------------------------------------------------|------------|-------------------------|------------|--------------------|------------|
| Martin Fogelman   |       | $                                             | 22,000     |                   | —     |                              | $          | 13,400                                                      |       | —                                                                                       |       | —                  |       | $                  | 57,000     | (3) | $ | 92,400 |   |
| Myra Hart         |       | $                                             | 25,500     |                   | —     |                              | $          | 13,400                                                      |       | —                                                                                       |       | —                  |       | —             |       | $ | 38,900 |   |
| Robert Stebenne   |       | $                                             | 23,500     |                   | —     |                              | $          | 13,400                                                      |       | —                                                                                       |       | —                  |       | —             |       | $ | 36,900 |   |
| Richard Wenz      |       | $                                             | 33,000     |                   | —     |                              | $          | 13,400                                                      |       | —                                                                                       |       | —                  |       | —             |       | $ | 46,400 |   |
|                   |            |                                               |            |                        |            |                                   |            |                                                             |            |                                                                                              |            |                         |            |                    |            |  |  |  |  |

 

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(1)                                  Messrs. Macari and Gibree are notincluded in this table as they are executive officers and, accordingly, receiveno compensation for their service as directors. The compensation received by Messrs. Macari and Gibree as executiveofficers is shown in the Summary Compensation Table below.

 

(2)                                  The amounts in this column do not reflectcompensation actually received by the named director or the actual value thatmay be recognized with respect to these awards in the future. The amounts inthis column reflect the dollar amount recognized for financial statementreporting purposes for the fiscal year ended December 31, 2008, inaccordance with FAS 123(R) for awards granted in 2007. Assumptions used inthe calculation of these amounts are included in Note 7 in the notes to ouraudited consolidated financial statements for the fiscal year ended December 31,2008 included in our Annual Report on Form 10-K filed with the Securitiesand Exchange Commission on March 25, 2009.

 

(3)                                  Mr. Fogelman receives $4,750 per monthas a paid consultant to our company.

 

*Committeesof the Boards of Directors*

 

Our Board of Directors hasdesignated the following committees: an Audit Committee, a CompensationCommittee and a Nominating Committee. The composition and objectives of each committee are described below.  Our Board of Directors continues to reviewits committees and the independence and qualifications of its current committeemembers in light of changes required under the Sarbanes-Oxley Act of 2002 andby the Securities and Exchange Commission (the “SEC”) and the Nasdaq StockMarket.

 

Our Board of Directors hasdetermined that a majority of the members of our Board of Directors areindependent directors under the rules of the Nasdaq Stock Market.  See “*Corporate Governance*”below.

 

*AuditCommittee*

 

The Audit Committee heldfour meetings in 2008.  As described inthe Audit Committee’s charter, a copy of which is available on our website atwww.summerinfant.com, the primary function of the Audit Committee is toappoint, retain, set compensation of, and supervise our independentaccountants, review the results and scope of the audit and other accountingrelated services and review our accounting practices and systems of internalaccounting and disclosure controls.

 

TheAudit Committee currently consists of three members:  Richard Wenz, Chairman, Myra Hart and RobertStebenne.  Each member of the AuditCommittee is an “independent” director under SEC rules.  No member of the Audit Committee is anemployee of our company or any of its subsidiaries.  We 

 

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havenot relied on exemptions for Audit Committee independence requirementscontained in Rule 10A-3 under the Securities Exchange Act of 1934.  The members of the Audit Committee are requiredto have extensive business and financial experience. They are also required tohave a good understanding of financial statements, including our balance sheet,income statement, cash flow statement and its quarterly and annual reports onForms 10-Q and 10-K and related financial statements and disclosures.  Our Board of Directors has determined that Mr. Wenzqualifies as an Audit Committee “financial expert.”

 

TheAudit Committee meets with our external and internal auditors and principalfinancial personnel to review quarterly financial results and the results ofthe annual audit (in both regular and executive sessions).  The Audit Committee reviews and approvesannual external auditor engagement plans, scopes and fees.  The Audit Committee approves all fees andterms related to the annual independent audit as well as all permissiblenon-audit engagements of the external auditors. The Audit Committee pre-approves all audit and permissible non-auditservices to be performed by the external auditors.

 

*CompensationCommittee*

 

The Compensation Committeemet four times in 2008.  As described inthe Compensation Committee’s charter, which is available on our website atwww.summerinfant.com, the Compensation Committee is responsible for the reviewand approval of our compensation paid to our executive officers and to theadministration of our incentive compensation plans, which includes authority tomake and modify awards under those plans.

 

The Compensation Committeecurrently consists of three members:  MyraHart, Chairman, Martin Fogelman and Richard Wenz.   Each member of the Compensation Committee isan “independent” director under SEC rules. No member of the Compensation Committee is an employee of our company orany of its subsidiaries.

 

*NominatingCommittee*

 

The Nominating Committee mettwo times in 2008.  As described in theNominating Committee’s charter, which is available on our website atwww.summerinfant.com, the Nominating Committee is responsible for overseeingthe selection of persons to be nominated to serve on our Board of Directors.

 

The Nominating Committeecurrently consists of three members: Robert Stebenne, Chairman, Martin Fogelman and Richard Wenz.   Each member of the Nominating Committee isan “independent” director under SEC rules. No member of the Nominating Committee is an employee of our company orany of its subsidiaries.

 

The Nominating Committeewill consider persons identified by its members, management, stockholders,investment bankers and others.  Until ourannual meeting of stockholders to be held in 2010, the nominees for our Boardof Directors are determined pursuant to the terms of the voting agreementdescribed below and approved by the Nominating Committee.

 

The Nominating Committee will identify, evaluate and recommendcandidates to become members of our Board of Directors with the goal ofcreating a balance of knowledge and experience. Nominations to our Board ofDirectors may also be submitted to the Nominating Committee by our stockholdersin accordance with our policy, as described below.  Candidates will be reviewed in the context ofthe current composition of our Board of Directors, our operating requirementsand the long-term interests of our stockholders.  In conducting this assessment, the NominatingCommittee will consider and evaluate each director-candidate based upon itsassessment of the following criteria:

 

·                  Whether the candidate is independent pursuantto the requirements of the Nasdaq Stock Market.

 

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·                  Whether the candidate is accomplished in hisor her field and has a reputation, both personal and professional, that isconsistent with our image and reputation.

 

·                  Whether the candidate has the ability to readand understand basic financial statements. The Nominating Committee also willdetermine if a candidate satisfies the criteria for being an “audit committeefinancial expert,” as defined by the SEC.

 

·                  Whether the candidate has relevant experienceand expertise and would be able to provide insights and practical wisdom basedupon that experience and expertise.

 

·                  Whether the candidate has knowledge of us andissues affecting us.

 

·                  Whether the candidate is committed toenhancing stockholder value.

 

·                  Whether the candidate fully understands, orhas the capacity to fully understand, the legal responsibilities of a directorand the governance processes of a public company.

 

·                  Whether the candidate is of high moral andethical character and would be willing to apply sound, objective andindependent business judgment, and to assume broad fiduciary responsibility.

 

·                  Whether the candidate has, and would bewilling to commit, the required hours necessary to discharge the duties ofBoard membership.

 

·                  Whether the candidate has any prohibitiveinterlocking relationships or conflicts of interest.

 

·                  Whether the candidate is able to develop agood working relationship with other Board members and contribute to the Board’sworking relationship with our senior management.

 

·                  Whether the candidate is able to suggestbusiness opportunities to us.

 

Stockholders who wish to recommend to the Nominating Committee acandidate for election to our Board of Directors should send their letters tous, Attention: Nominating Committee.  OurCorporate Secretary will promptly forward all letters to the members of theNominating Committee. Stockholders must follow certain procedures to recommendto the Nominating Committee candidates for election as directors. In general,in order to provide sufficient time to enable the Nominating Committee to evaluatecandidates recommended by stockholders in connection with selecting candidatesfor nomination in connection with our annual meeting of stockholders, theCorporate Secretary must receive the stockholder’s recommendation no later thanthirty (30) days after the end of our fiscal year.

 

The recommendation must contain the following information about thecandidate:

 

·                  Name;

 

·                  Age;

 

·                  Business and current residence addresses, aswell as residence addresses for the past 20 years;

 

·                  Principal occupation or employment andemployment history (name and address of employer and job title) for the past 10years (or such shorter period as the candidate has been in the workforce);

 

·                  Educational background;

 

·                  Permission for us to conduct a backgroundinvestigation, including the right to obtain education, employment and creditinformation;

 

·                  The number of shares of our common stockbeneficially owned by the candidate;

 

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·                  The information that would be required to bedisclosed by us about the candidate under the rules of the SEC in a ProxyStatement soliciting proxies for the election of such candidate as a director(which currently includes information required by Items 401, 404 and 405 ofRegulation S-K); and

 

·                  A signed consent of the nominee to serve as adirector, if elected.

 

**Voting Agreement**

 

Messrs. Macariand Gibree and certain of our other stockholders entered into a votingagreement in connection with the KBL/Summer Predecessor merger.  The individuals that were party to this votingagreement owned approximately 38.5% of our outstanding common stock in theaggregate at the date of the agreement. The voting agreement provides that Messrs. Macari and Gibree, onthe one hand, and the other founding stockholders party to this votingagreement, on the other hand, will each designate two directors and mutuallydesignate three additional directors to our Board of Directors.  Each of the parties to the voting agreementwill vote for these designees as directors until immediately following theelection to be held in 2010.

 

Underthe terms of the voting agreement, Messrs. Macari and Gibree, on the onehand, and the other founding stockholders party to this agreement, on the otherhand, have agreed to vote for the designees to our Board of Directors throughthe election in 2010 as follows:

 
| · |   | Class A—Myra Hart and Robert Stebenne                   |
|--------|--------|-------------------------------------------------------------------|
|   |   |                                                              |
| · |   | Class B—Steven Gibree, Martin Fogelman and Richard Wenz |
|   |   |                                                              |
| · |   | Class C—Jason Macari                                    |

 

**Corporate Governance**

 

*Independence*

 

OurBoard of Directors has adopted categorical standards to assist it in makingindependence determinations.  Under thosestandards, in determining independence each year, our Board of Directors willanalyze each director’s relationship with us and our subsidiaries to determinewhether our directors are independent under the rules of the Nasdaq StockMarket.  Our Board of Directors has determined that all of our currentdirectors, except Messrs. Macari and Gibree, are “independent” within themeaning of the independence rules of the Nasdaq Stock Market.

 

*ExecutiveSessions*

 

Alldirectors who are not employees of our company or our subsidiaries meet inexecutive session at least quarterly.

 

*Code ofEthics*

 

We have adopted acomprehensive Code of Ethics for all employees and directors, which can befound on our website at www.summerinfant.com.

 

*Communicationswith Directors*

 

Stockholders may sendcommunications to our Board of Directors, the Chairman, or one or morenon-management directors by using the contact information provided on our website.  Stockholders also may send communications byletter addressed to our Corporate Secretary at Summer Infant, Inc., 1275Park East Drive, Woonsocket, Rhode Island 02895.  All communications will be received andreviewed by our Corporate Secretary. Stockholder concerns about our accounting, internal controls, auditingmatters or business practices will be reported to the Audit Committee.  All other concerns will be reported to theappropriate committee(s) of our Board of Directors.

 

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##### **EXECUTIVE OFFICERS**

##### ** **

Our executive officers are set forth below.

 
| **Name**             | ** ** | **Age** | ** ** | **Position**                                                    |
|----------------------|------------|---------|------------|-----------------------------------------------------------------|
|                 |       |    |       |                                                            |
| Jason  Macari (1)    |       | 46      |       | Chairman  of the Board of Directors and Chief Executive Officer |
| Steven  Gibree (2)   |       | 42      |       | EVP  of Product Development and director                        |
| Joseph  Driscoll (3) |       | 44      |       | Chief  Financial Officer and Treasurer                          |

 

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(1)           Mr. Macari has been our ChiefExecutive Officer and a director since March 2007.  Prior to March 2007, Mr. Macari wasChief Executive Officer and founder of Summer Predecessor, which he founded in2001.  Prior to that time, Mr. Macariwas vice president of product development and general manager of Safety 1st, Inc.,a leading manufacturer of safety and baby products from August 1994 to June 2001.From May 1988 to August 1994, Mr. Macari managed themanufacturing engineering group of the Davol Division of CR Bard, amanufacturer of surgical products.

 

(2)           Mr. Gibree is our executive vicepresident of product development with management oversight of research anddevelopment, product design and engineering and manufacturing relations.  Prior to March 2007, Mr. Gibreeheld these same positions at Summer Predecessor, with whom he had been employedsince November 2001.  Prior to thattime, Mr. Gibree was the vice president of engineering for Little Kids, Inc.,a manufacturer of innovative toys, from March 2001 to November 2001.From May 1997 to March 2001, Mr. Gibree was director of engineeringat Safety 1st, Inc.  From May 1985to May 1997, Mr. Gibree was employed by Hasbro, rising to projectmanager for the Kid Dimension Division.

 

(3)           Mr. Driscoll has been our chieffinancial officer since March 2007. Prior to March 2007, Mr. Driscoll was the chief financialofficer at Summer Predecessor, with whom he had been employed since September 2006.  From May 2001 to September 2006, Mr. Driscollwas employed as vice president of finance and later served as chief financialofficer for ACT Electronics, Inc., an electronics manufacturer.  From May 2000 to May 2001, Mr. Driscollwas employed as vice president of finance for PCI, Inc., an internet basedmarketing services company.  From April 1997to May 2000, Mr. Driscoll was employed as vice president of financeand later served as chief financial officer for Safety 1st, Inc.  From September 1993 to April 1997, Mr. Driscollwas employed as assistant corporate controller and later served as director offinancial reporting for Staples, Inc. From July 1986 to February 1992, Mr. Driscoll wasemployed as an audit manager for KPMG Peat Marwick. From February 1992 to September 1993,Mr. Driscoll was employed as corporate controller for E-II Holdings, Inc.,an international consumer products company. Mr. Driscoll is a licensedCertified Public Accountant.

 

*Section 16(a) Beneficial Ownership Reporting Compliance*

 

Section 16(a) of the Securities Exchange Act of 1934 requiresour directors and executive officers, and persons who own more than 10% of aregistered class of our equity securities, to file with the SEC reports ofownership and changes in ownership of our common stock and other equitysecurities. Officers, directors and greater than 10% stockholders are requiredby SEC regulations to furnish us with copies of all Section 16(a) formsthey file.

 

Based solely on review of the copies of those reports furnished to usor written or oral representations that no other reports were required, webelieve that during 2008, all filing requirements applicable to its officers,directors and greater than 10% beneficial owners were complied with.

 

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**Item 11. Executive Compensation.**

 

*Compensation Discussion andAnalysis*

 

The compensation committeeof the board of directors consists of independent directors who areresponsible, on behalf of the Board of Directors, for reviewing and approvingthe amounts and types of compensation paid to the Company’s executive officersand the non-employee directors, as well as all bonus and equity compensationpaid to other Company employees.

 

The committee is responsiblefor determining that compensation paid under the Company’s programs isequitable (i.e., that it is appropriate to the responsibilities of theposition), the performance of the company and the individual, and meets  the standards of the competitivemarketplace.  The committee typicallymeets four times per year and additionally as needed.   The committee met 4 times during 2008.  The compensation committee’s chairmanregularly reports to the board of directors on compensation committee policy,procedures, actions, and recommendations. The Company’s compensation committeehas authority to retain (at the Company’s expense) outside counsel,compensation consultants and other advisors to assist as needed.

 

The individuals who servedas the Company’s chief executive officer, executive vice president of productdevelopment, and chief financial officer during fiscal year 2008, are referredto as the “named executive officers.” With respect to the named executiveofficers (NEOs), this Compensation Discussion and Analysis identifies theCompany’s current compensation philosophy and objectives and describes thevarious methodologies, policies and practices for establishing andadministering the compensation programs of the named executive officers.

 

*Compensation Objectives*

 

Thegoals of the compensation program are:

 

·                  To attract, retain and motivate qualifiedexecutives who will lead the company to in achieving high performance.

 

·                  To support business strategies that result insuperior long term shareholder value.

 

·                  To align pay with performance by making asubstantial portion of compensation dependent on achievement of corporatefinancial and strategic objectives as well as individual performance goals.

 

·                  To align management interests with those ofour shareholder base by making a substantial portion of compensationequity-based.

 

The compensation committeebelieves that a properly structured compensation program attracts and retainstalented individuals and motivates them to achieve specific short- andlong-term strategic objectives.  In orderto do that, a significant percentage of executive pay is based on the principleof pay-for-performance. The compensation committee is committed to ensuringthat the total compensation package of named executive officers is competitivewith compensation at peer-group companies.  The peer group used by HR Xpress includedvarious consumer product companies in New England.

 

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The Company’s executive compensation programs aredesigned to provide:

 
| · |   | levels of base compensation that are appropriate to the  responsibilities of the position and competitive with comparable companies;                                 |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                 |
| · |   | annual incentive awards that vary in a manner consistent with the  achievement of the performance targets for the company and of individual  performance objectives. |
|   |   |                                                                                                                                                                 |
| · |   | long-term incentive compensation that focuses executive efforts on  building shareholder value through meeting longer-term financial and  strategic goals; and  |
|   |   |                                                                                                                                                                 |
| · |   | executive benefits that are competitive with comparable companies.                                                                                                   |

 

In designing andadministering Summer Infant’s executive compensation programs, the compensationcommittee attempts to strike an appropriate balance among these variouselements.

 
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · |   | The committee considers  the pay practices of the compensation peer group to assess the appropriate  pay mix and compensation levels.                                                                                                                                                                                                                                                                                                         |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| · |   | With respect to  performance-based pay, the compensation committee believes that executive  compensation should be closely tied to achievement of the financial and  operational goals established in advance by the Board of Directors of the  Company, as well as to the achievement individual performance goals of the  named executive officers.                                                                                         |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| · |   | The committee uses  equity-based compensation to align the executives’ interests with those of  the Company’s shareholders over a longer period of time. For purposes of  retention, the compensation committee believes that the equity-based  compensation should have meaningful conditions that encourage valued  employees to remain in the employ of the Company as well as to achieve the  performance goals of the company. |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| · |   | The committee also  considers executive benefit programs as a means to attract, retain and  motivate highly qualified executives                                                                                                                                                                                                                                                                                                              |

 

*Methodology for EstablishingCompensation*

 

The compensation committeeis comprised of three independent directors who satisfy the Nasdaq listingrequirements and relevant SEC regulations. There are no interlockingrelationships between any member of our compensation committee and any of ourexecutive officers. None of the compensation committee members is an officer,employee or former officer or employee of the Company.

 

The compensation committeeis responsible for all compensation decisions for the chief executive officerand other named executive officers. The chief executive officer annuallyreviews the performance of the other named executive officers, includingconsideration of market pay practices of the compensation peer group inconjunction with both Company and individual performance. The conclusions andrecommendations of the chief executive officer are presented to thecompensation committee for approval. The compensation committee has

 

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absolutediscretion as to whether it approves the recommendations of the chief executiveofficer or makes adjustments, as it deems appropriate.

 

*The Elements of Compensation*

 

Total direct compensation includes cash, in the form of base salary andannual incentives.  Equity in the form ofrestricted stock and options is used as a long-term incentive. The compensationcommittee evaluates the mix between these three elements of compensation basedon the pay practices of comparable companies. Summer Infant is a young company and its compensation design is verymuch a work in progress. In 2008, with the assistance of a professionalcompensation consultant, HR Xpress, the company and the compensation committeereviewed all professional positions and classified them as to level ofresponsibility, appropriate base pay ranges and incentive payout ranges.  The compensation decisions were made on thebasis of competitive information provided by the consultant.

 

Thecompanies included in the compensation peer group were selected primarily onthe basis of their comparability to the Company based on a combination ofgeography (companies based in New England) and size, as measured through annualrevenue, market capitalization and other financial measures. Although thecompensation committee also considered and reviewed information from proxystatements and other relevant survey data, it particularly focused on thepractices of the compensation peer group in considering compensation levels forthe chief executive officer and the other named executive officers.

 

Inits annual review, the compensation committee considers the opinions andrecommendations of the chief executive officer and various outside counsel andstrives to be fully informed in its determination of the appropriatecompensation mix and award levels for the named executive officers. Allcompensation decisions are made with consideration of the compensationcommittee’s guiding principles of fairness to employees, retention of talentedexecutives and the achievement of improved Company performance, whichultimately benefits the Company’s shareholders. With respect to the namedexecutive officers, the following describes in greater detail the objectivesand policies behind the various elements of the compensation mix.

 

*BaseSalary*

 

Thecompensation committee strives to provide that employees are paid a base salarythat is competitive with salaries paid by comparable organizations for similarwork, based on each employee’s experience, performance and geographic location.Generally, the Company has chosen to target cash compensation at market medianlevels in order to remain competitive in attracting and retaining executivetalent. The allocation of total cash between base salary and incentive bonusawards is based on a variety of factors. The compensation committee considers acombination of the executive’s performance, the performance of the Company andthe individual business or corporate function for which the executive isresponsible, the nature and importance of the position and role within theCompany, the scope of the executive’s responsibility, internal relationships orcomparisons and the current compensation package in place for that executive,including the executive’s current annual salary and potential bonus awardsunder the Company’s short-time incentive plan.

 

The compensation committee generally evaluates executive salariesannually. An analysis of executive compensation indicated that base salariesfor the named executive officers were generally positioned at the marketmedian. For the 2008 fiscal year, based upon the 

 

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compensationcommittee’s assessment of the information and factors described above, thecompensation committee determined to increase the base salaries of the namedexecutive officers incrementally to maintain market median levels.

 

*AnnualIncentive Bonus*

 

The Company intends to continue its strategy of compensating the namedexecutive officers through programs that emphasize performance-based incentivecompensation. The Company’s short-term incentive compensation program isdesigned to recognize and reward executive officers and other employees whocontribute meaningfully to an increase in stockholder value and profitability.

 

In general, the funding of the annual incentive bonus pool is dependentupon earnings before interest, taxes, depreciation and amortization (afterdeducting incentive compensation) of the Company, in addition to meetingcertain other targets. If the plan is fully funded, each named executiveofficer has the ability to receive the target bonus payout. The percentage ofthe target bonus actually paid to each named executive officer depends on theattainment of corporate financial goals and individual performance targets.

 

*Long-TermIncentive Awards*

 

Long-term incentive awards are the third component of the Company’stotal compensation package. The compensation committee believes thatequity-based compensation ensures that the Company’s officers have a continuingstake in the long-term success of the Company. The Company’s 2006 Incentive Planprovides for equity incentive awards, which include qualified and nonqualifiedstock options, restricted stock, stock appreciation rights, long-term incentivecompensation units consisting of a combination of cash and common stock or anycombination thereof within the limitations set forth in the plan. Thecompensation committee approves all awards under the plan and acts as theadministrator of the plan.

 

Award levels under the plan are determined based on the compensationpractices of the compensation peer group. In general, long-term incentiveawards are targeted at the median of the compensation peer group withappropriate adjustments for individual and Company performance, although pastawards have generally been below market levels. Options granted under the planvest and become exercisable in equal installments over a four-year period fromthe grant date. All stock options have been granted with a ten-year term andhave an exercise price equal to the fair market value of the Company’s commonstock on the date of grant. Restricted stock awards under the plan vest over afour year period. Restricted stock cannot be sold or transferred until theshares vest. Should a named executive officer leave the Company prior to thecompletion of the applicable vesting schedule, the unvested portion of thegrant is forfeited.

 

There were no issuances ofstock options or restricted stock awards in fiscal 2008.

 

*Broad-BasedBenefits Programs*

 

The named executive officers are entitled to participate in thebenefits programs that are available to all full-time employees. These benefitsinclude health, dental, and life insurance, healthcare reimbursement accounts,paid vacation and company contributions to a 401(k) profit-sharingretirement plan. Two of the named executive officers also receive a carallowance.  The Company’s 401(k) planprovides for matching contributions by the Company in an amount equal 

 

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tothe first 2% of employee compensation deferred, plus 50% of the next 1% ofemployee compensation deferred. All full-time employees age 21 and olderare eligible to participate in the plan after six months of service.

 

**Evaluation of Chief ExecutiveOfficer Compensation and Executive Performance**

 

*Compensationof Chief Executive Officer*

 

The compensation committee meets with the other independent directorseach year in executive session to evaluate the performance of the chiefexecutive officer. The compensation committee also consults with itsindependent consultant in setting the chief executive officer’s compensation.Neither the compensation committee nor its independent consultant confers withthe chief executive officer or any other members of management when setting hisbase salary. The compensation committee does not rely solely on predeterminedformulas or a limited set of criteria when it evaluates the performance of thechief executive officer and the other named executive officers. For fiscal year2008, the compensation committee considered the chief executive officer’srecent performance, his achievements in prior years, his achievement ofspecific short-term goals and the Company’s performance in fiscal year 2007. Basedon its review, the compensation committee at its February 2008 meetingapproved a merit increase to raise the chief executive officer’s salary to$350,000 effective on March 1, 2008.

 

*Compensationof Other Named Executive Officers*

 

The chief executive officer met with the compensation committee toreview his compensation recommendations for the other named executive officers.He described the findings of his performance evaluation of all such persons andprovided the basis of his recommendations with the compensation committee,including the scope of each person’s duties, oversight responsibilities andindividual objectives and goals against results achieved for fiscal year 2007.

 

In addition to approving adjustments to Mr. Macari’s base salary,at its February 2008 meeting, the compensation committee approved a meritincrease to raise the base salaries of the Company’s other named executiveofficers, effective on March 1, 2008, as follows: Steve Gibree, $240,000and Joseph Driscoll, $200,000. In its analysis of the other named executiveofficers, the compensation committee applied the same rationale to this groupas it applied when considering the chief executive officer’s base salary. Thecompensation committee also considered the pay practices of the compensationpeer group.

 

*AdministrativePolicies and Practices*

 

Toevaluate and administer the compensation programs of the chief executiveofficer and other named executive officers, the compensation committee meetsperiodically each year in conjunction with regularly scheduled board meetings.The compensation committee also holds “special” meetings and meetstelephonically to discuss extraordinary items.

 

Thefollowing table describes the compensation awarded to the Chief ExecutiveOfficer, the EVP of Product Development, and the Chief Financial Officer in2008 and 2007 (the “named executive officers”):

 

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**SUMMARY COMPENSATION TABLE**

 
| **Name & Principal Position** | ** ** | **Year**   | ** ** | **Salary  ($)** | ** ** | **(1)  Bonus  ($)** | ** ** | **(2)  Option  Awards  ($)** | ** ** | **All Other  Compensation  ($)** | ** ** | **Total  ($)** | ** ** |
|--------------------------------------------------|------------|------------|------------|-----------------|------------|---------------------|------------|------------------------------|------------|---------------------------------------|------------|----------------|------------|
| ** **                                       | ** ** | ** ** | ** ** | ** **      | ** ** | ** **          | ** ** | ** **                   | ** ** | ** **                            | ** ** | ** **     | ** ** |
| Jason Macari                                     |       | 2008       |       | $347,596        |       | $140,000            |       | —                       |       | $19,849                               | (3)        | $507,445       |       |
| Chief Executive                                  |       | 2007       |       | $275,000        |       | $137,500            |       | —                       |       | $229,996                              | (3)        | $648,496       |       |
| Officer                                          |       |       |       |            |       |                |       |                         |       |                                  |       |           |       |
|                                             |       |       |       |            |       |                |       |                         |       |                                  |       |           |       |
| Steve Gibree                                     |       | 2008       |       | $235,769        |       | $84,000             |       | $56,950                      |       | $17,034                               | (4)        | $393,663       |       |
| EVP of Product                                   |       | 2007       |       | $220,000        |       | $110,000            |       | $99,663                      |       | $37,268                               | (4)        | $466,931       |       |
| Development                                      |       |       |       |            |       |                |       |                         |       |                                  |       |           |       |
|                                             |       |       |       |            |       |                |       |                         |       |                                  |       |           |       |
| Joseph Driscoll                                  |       | 2008       |       | $189,566        |       | $50,000             |       | $56,950                      |       | $4,600                                | (5)        | $301,116       |       |
| Chief Financial                                  |       | 2007       |       | $170,000        |       | $92,500             |       | $99,663                      |       | $3,269                                | (5)        | $365,432       |       |
| Officer                                          |       |       |       |            |       |                |       |                         |       |                                  |       |           |       |

 

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(1)          The bonus amounts shown for 2007 were earned in 2007 and paid in 2008,with the exception of a $50,000 bonus paid to Mr. Driscoll in connectionwith the completion of the KBL/Summer Predecessor merger in March 2007.  The 2008 bonus column reflects approvedamounts for the named executives; no cash payments have been paid to date in2009 related to the approved 2008 bonus.

 

(2)          The amounts in this column do not reflect compensation actuallyreceived by the named executive or the actual value that may be recognized withrespect to these awards in the future. The amounts reflect the dollar amountrecognized for financial statement reporting purposes for the fiscal year endedDecember 31, 2007 and 2008, in accordance with FAS 123(R) for awardsgranted in 2007. Assumptions used in the calculation of these amounts areincluded in Note 7 in the notes to our audited consolidated financialstatements for the fiscal year ended December 31, 2008 included in ourAnnual Report on Form 10-K filed with the Securities and ExchangeCommission on March 25, 2009. These options have an exercise price of$5.25 and are therefore out of the money as of December 31, 2008.

 

(3)          The 2007 amount represents (a) $210,600 in additional contingentamounts paid to Mr. Macari under the KBL/Summer Predecessor merger agreement,(b) $14,118 in compensation as a result of a company automobile providedto Mr. Macari, and (c) $5,278 in matching contributions made by usunder our 401(k) plan for Mr. Macari’s benefit. The 2008 amountincludes $15,249 for the automobile benefit and $4,600 for the company 401(k) match.

 

(4)          The 2007 amount represents (a) $23,400 in additional contingentamounts paid to Mr. Gibree under the KBL/Summer Predecessor mergeragreement, (b) $9,706 in compensation as a result of a company automobileprovided to Mr. Gibree, and (c) $4,162 in matching contributions madeby us under our 401(k) plan for Mr. Gibree’s benefit.  The 2008 amount includes $12,434 for theautomobile benefit and $4,600 for the company 401(k) match.

 

(5)          The 2007 amount represents $3,269 in matching contributions made by usunder our 401(k) plan for Mr. Driscoll’s benefit. The 2008 amountincludes $4,600 for the company 401(k) match.

 

**NARRATIVE DISCLOSURE TO SUMMARYCOMPENSATION TABLE**

 

*MaterialTerms of Employment Contracts of Named Executive Officers*

 

*Jason Macari, Chief Executive Officer*.  Inconnection with KBL/Summer Predecessor merger, Mr. Macari entered into anemployment agreement with Summer Infant. This employment agreement is 

 

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anappendix to the proxy statement we filed with the SEC in connection with themerger.   Under the terms of thisemployment agreement, Mr. Macari serves as the chief executive officer foran initial term of three years.  Theemployment agreement provides that Mr. Macari will receive an annual basesalary of $275,000.  Mr. Macari alsomay be awarded a bonus in an amount equal to up to 50% of his base salaryduring any fiscal year during the employment term.  One half of that bonus would be based on hisperformance against performance criteria for that fiscal year to be set, inwriting, by the Compensation Committee within 45 days after the Board ofDirectors approves the budget for that year and the remaining portion would beawarded in the discretion of the Compensation Committee.

 

Theemployment agreement provides that, in the event of the termination of Mr. Macari’semployment  without cause or upontermination of his employment as a result of a breach of the employmentagreement, the company will continue to pay him his base salary in accordancewith our normal payroll schedule for a period of 12 months from the date oftermination.  The employment agreementcontains certain restrictive covenants that prohibit Mr. Macari fromdisclosing information that is confidential to Summer Infant and itssubsidiaries and generally prohibits him, during the employment term and forone year thereafter, from soliciting or hiring employees or competing withSummer Infant.

 

*Steven Gibree, Executive Vice President-ProductDevelopment. *In connection with KBL/Summer Predecessormerger, Mr. Gibree entered into an employment agreement with SummerInfant.  This employment agreement is anappendix to the proxy statement filed with the SEC in connection with themerger.   Under the terms of thisemployment agreement, Mr. Gibree serves as Summer Infant’s executive vicepresident of product development for an initial term of three years.  The employment agreement provides that Mr. Gibreeis to receive an annual base salary of $220,000.  Mr. Gibree also may be awarded a bonusin an amount equal to up to 50% of his base salary during any fiscal yearduring the employment term.  One half ofthat bonus would be based on his performance against performance criteria forthat fiscal year to be set, in writing, by the Compensation Committee within 45days after the Board of Directors approves the budget for that year and theremaining portion would be awarded in the discretion of the CompensationCommittee.

 

Theemployment agreement provides that, in the event of the termination of Mr. Gibree’semployment without cause or upon termination of his employment as a result ofour breach of the employment agreement, Summer Infant will continue to pay himhis base salary in accordance with the normal payroll schedule for a period of12 months from the date of termination. The employment agreement contains certain restrictive covenants thatprohibit Mr. Gibree from disclosing information that is confidential toSummer Infant and its subsidiaries and generally prohibits him, during theemployment term and for one year thereafter, from soliciting or hiringemployees or competing with Summer Infant.

 

*Joseph Driscoll, Chief Financial Officer*.  InSeptember 2006, Mr. Driscoll entered into a full-time employmentagreement with Summer Predecessor.  Thisemployment agreement is an appendix to the proxy statement we filed with theSEC in connection with the merger.   Underthe terms of this employment agreement, Mr. Driscoll serves as our chieffinancial officer for an initial term of two years.  The employment agreement provides that Mr. Driscollis to receive an annual base salary of $170,000.  Mr. Driscoll was also eligible toreceive $92,500 in bonus payments in 2007 based on the company achieving its2007 performance goals in addition to successfully completing the KBL merger.

 

Theemployment agreement provides that, in the event of the termination of Mr. Driscoll’semployment by Summer Infant without cause or upon termination of his employmentas a result of breach of the employment agreement, the company will continue topay him his base salary in accordance with the normal payroll schedule for aperiod of six months from the date of termination.  The employment agreement contains certainrestrictive covenants that prohibit Mr. Driscoll from disclosinginformation that is confidential to Summer Infant and its subsidiaries andgenerally prohibits him, during the employment term and for one yearthereafter, from soliciting or hiring our employees or competing with SummerInfant.

 

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**OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END**

 

            The following table providesinformation about outstanding equity awards held by the named executiveofficers at the end of fiscal 2008:

** **
| ** **      | ** ** | **Stock Option Awards** | ** ** |
|-----------------|------------|-----------------------------------|------------|
| **Name**        | ** ** | **Option  Grant Date**       | ** ** | **Number of  Securities  Underlying  Unexercised  Options (#)  Exercisable** | ** ** | **Number of  Securities  Underlying  Unexercised  Options (#)  Unexercisable** | ** ** | **Option  Exercise  Price Per  Share ($)** | ** ** | **Option  Expiration  Date** | ** ** |
|            |       |                              |       |   |   |   |   |   |   |   |   |
| Jason Macari    |       | —                            |       | — |   | — |   | — |   | — |   |
|            |       |                              |       |   |   |   |   |   |   |   |   |
| Steven Gibree   |       | 03/07/2007                        |       | 127,500 |   | 63,750 |   | 5.25 |   | 03/07/2017 |   |
|            |       |                              |       |   |   |   |   |   |   |   |   |
| Joseph Driscoll |       | 03/07/2007                        |       | 127,500 |   | 63,750 |   | 5.25 |   | 03/07/2017 |   |

## ** **

25%of the total number of shares subject to the options vested on March 7,2007, and an additional 25% of the options vested on March 7, 2008, thetotal number of shares subject to the option will vest and become exercisableon each of the second and third anniversaries of the March 7, 2007 vestingcommencement date, subject to continued employment. All of the stock options inthe above table are out of the money based on the stock price as of April 29,2009.

 

**Item 12. Security Ownership of Certain Beneficial Ownersand Management and Related Stockholder Matters**

 

*Ownership of Summer Infant, Inc. CommonStock*

 

The following table setsforth information regarding the beneficial ownership of our common stock as of April 27,2009 by:

 

·                  eachperson known by us to be the beneficial owner of more than 5% of ouroutstanding shares of common stock;

 

·                  eachof our current executive officers and directors; and

 

·                  allour current executive officers and directors as a group

 

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| **Name and Address of Beneficial Owner(1)** | ** ** | **Amount and Nature of  Beneficial Ownership  (2)(3)** | ** ** | **Percent of  Common Stock  (3)** | ** ** |
|----------------------------------------------------------------------|------------|----------------------------------------------------------------------------|------------|---------------------------------------------|------------|
| **5%  Stockholders**                                                 |       |                                                                       |       |                                        |       |
| Wynnefield  Capital Management LLC(4)                                |       |                                                                       |       |                                        |       |
| 450 Seventh Avenue, Suite 509                                   |       |                                                                       |       |                                        |       |
| New York, NY 10123                                                   |       | 3,595,905                                                             |       | 16.9                                        | %          |
|                                                                 |       |                                                                       |       |                                        |       |
| Buckingham  Capital Management Incorporated(5)                       |       |                                                                       |       |                                        |       |
| 750 Third Avenue, Sixth Floor,                                       |       |                                                                       |       |                                        |       |
| New York, NY 10017                                                   |       | 1,529,550                                                                  |       | 9.9                                         | %          |
|                                                                 |       |                                                                       |       |                                        |       |
| Pine  River Capital Management L.P.(6)                               |       |                                                                       |       |                                        |       |
| 601 Carlson Parkway                                             |       |                                                                       |       |                                        |       |
| Suite 330                                                       |       |                                                                       |       |                                        |       |
| Minnetonka, MN 55305                                                 |       | 1,374,986                                                                  |       | 8.9                                         | %          |
| **Directors and Named Executive Officers**       | ** ** | ** **                                                                 | ** ** | ** **                                  | ** ** |
|                                                                 |       |                                                                       |       |                                        |       |
| Jason Macari                                                         |       | 3,484,503                                                                  |       | 22.6                                        | %          |
| Steven Gibree                                                        |       | 708,952                                                                    |       | 4.6                                         | %          |
| Joseph Driscoll                                                      |       | 142,500                                                                    |       |                                        | *          |
| Myra Hart                                                            |       | 32,000                                                                     |       |                                        | *          |
| Martin Fogelman                                                      |       | 32,000                                                                     |       |                                        |       |
| Robert Stebenne                                                      |       | 32,000                                                                     |       |                                        | *          |
| Richard Wenz                                                         |       | 32,000                                                                     |       |                                        | *          |
|                                                                 |       |                                                                       |       |                                        |       |
| Directors and officers as a group (7  persons)                       |       | 4,463,955                                                                  |       | 29.0                                        | %          |

 

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*  Less than 1%

 

(1)           Unless otherwise noted, the business address of each of the followingis 1275 Park East Drive, Woonsocket, Rhode Island 02895.

 

(2)           Includes shares for which the named person:

 

·                  has sole voting and investment power, and

 

·                  has shared voting and investment power withhis spouse, unless otherwise indicated in the footnotes.

 

(3)             May Include shares underlying warrants that expired of April 20, 2009. Thetotal also includes vested restricted shares, in addition to the followingnumber of shares that can be acquired through stock option exercises through July 5,2009 as follows:

 
| **Directors and Named Executive  Officers** | ** ** | **Options Exercisable  through July 5, 2009** | ** ** |
|------------------------------------------------------------|------------|-------------------------------------------------------------------|------------|
| Mr. Macari                                            |       | 77,500                                                            |       |
| Mr. Gibree                                            |       | 133,750                                                           |       |
| Ms. Hart                                              |       | 30,000                                                            |       |
| Mr. Fogelman                                          |       | 30,000                                                            |       |
| Mr. Stebenne                                          |       | 30,000                                                            |       |
| Mr. Wenz                                              |       | 30,000                                                            |       |
| Mr. Driscoll                                          |       | 132,500                                                           |       |

 

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Notethat all exercisable stock options in the above table have an exercise price inexcess of the current stock price and therefore are out of the money as of April 3,2009.

 

(4)           All information relating to beneficial ownership of common stock wasobtained from an amended Form 4 filed on April 22, 2009 with the SEC.

 

(5)           All information relating to beneficial ownership of common stock wasobtained from Schedule 13 G/A filed on February 12, 2009 with the SEC.

 

(6)           All information relating to beneficial ownership of common stock wasobtained from a Schedule 13G filed on February 10, 2009 with the SEC.

 

*Equity Compensation Plan Information*

 

Thefollowing table summarizes share information, as of December 31, 2008,for  our equity compensation plans,including the 2006 Performance Equity Plan.

 
| **Plan Category**                                        | ** ** | **Number of  Common Shares to Be  Issued Upon Exercise  of Outstanding  Options** | ** ** | **Weighted Average  Exercise Price of  Outstanding Options** | ** ** | **Number of  Common Shares  Available for Future  Issuance Under  Equity  Compensation Plans ****(1)** | ** ** |
|---------------------------------------------------------------|------------|----------------------------------------------------------------------------------------------------------------------|------------|----------------------------------------------------------------------------------|------------|-------------------------------------------------------------------------------------------------------------------------------------------|------------|
| Equity compensation plans approved by  stockholders           |       | 999,200                                                                                                              |       | $                                                                                | 5.23       |                                                                                                                                      | 2,000,800  |   |
| Equity compensation plans not   approved by stockholders |       |                                                                                                                 |       |                                                                             |       |                                                                                                                                      |       |
| Total                                                         |       | 999,200                                                                                                              |       | $                                                                                | 5.23       |                                                                                                                                      | 2,000,800  |   |

 

**Item 13. Certain Relationships, Related Transactions andDirector Independence**

 

*Certain Relationships and Related Transactions*

 

InMarch 2009, the Company entered into a sale-leaseback transaction relatedto its corporate headquarters in Woonsocket, Rhode Island.  Under the terms of the transaction, theCompany sold its facility to Faith Realty II, LLC, a company owned by JasonMacari, CEO and Chairman of Summer Infant and his spouse, for $4.05 million andsubsequently entered into an agreement to lease the facility for an initialterm of 7 years with one (1) 5 year extension option.  The purchase price, which was determined byindependent appraisals of the property, approximates the net book value of thebuilding on the Company’s books, and therefore will result in an immaterialP&L impact.  The company will beleasing back the building for approximately the same amount it currently paysin principal and interest payments each month on its real estate loan.  This transaction enables the Company to paydown outstanding debt and provides greater borrowing flexibility.

 

*DirectorIndependence*

 

OurBoard of Directors has adopted categorical standards to assist it in makingindependence determinations.  Under thosestandards, in determining independence each year, our Board of Directors willanalyze each director’s relationship with us and our subsidiaries to determinewhether our directors are independent under the rules of the Nasdaq StockMarket.  Our Board of Directors has determined that 

 

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allof our current directors, except Messrs. Macari and Gibree, are “independent”within the meaning of the independence rules of the Nasdaq Stock Market.

 

**Item 14. PrincipalAccounting Fees and Services**

 

*Independent Registered Public Accountants*

 

TheAudit Committee has engaged McGladrey & Pullen, LLP as our independentregistered public accountants for the current fiscal year.

 

As our independent registered public accountants, McGladrey &Pullen, LLP was engaged to conduct quarterly reviews of us and to conduct anaudit of our consolidated financial statements for the full year 2008.

 

*Principal Accountant Fees and Services*

 

Aswe previously disclosed, certain of the partners of Goldstein Golub Kessler LLPbecame partners of McGladrey & Pullen, LLP in a limited asset purchaseagreement effective October 3, 2007.  As a result, Goldstein GolubKessler LLP resigned as our auditors effective November 15, 2007 andMcGladrey & Pullen, LLP was appointed as the auditors of our annualfinancial statements for the year ended December 31, 2008.

 

ThroughNovember 15, 2007, Goldstein Golub Kessler LLP had a continuingrelationship with RSM McGladrey, Inc., from which it leased auditing staffwho were full time, permanent employees of RSM McGladrey, Inc. and throughwhich its partners provide non-audit services.  Goldstein Golub KesslerLLP had no full time employees and therefore, none of the audit servicesperformed were provided by permanent full-time employees of the Goldstein GolubKessler LLP.  Goldstein Golub Kessler LLP managed and supervised the auditstaff, and was exclusively responsible for the opinion rendered in connectionwith its examination.

 

Thefollowing table shows the fees paid or accrued for the audit and other servicesprovided for the years ended December 31, 2008 and 2007:

 
| ** **         | ** ** | **2008 Fees** | ** ** | **2007 Fees** | ** ** |
|--------------------|------------|--------------------|------------|--------------------|------------|
| Audit Fees         |       | $                  | 239,000    |               | $          | 181,465 |   |
| Audit-Related Fees |       | 77,500             |       | —             |       |
| Tax Fees           |       | —             |       | —             |       |
| All Other Fees     |       | —             |       | —             |       |
|               |       |               |       |               |       |
| Total Fees         |       | $                  | 316,500    |               | $          | 181,465 |   |

 

*Audit Fees*****werefor professional services rendered for the audit of our annual consolidatedfinancial statements and review of consolidated financial statements includedin our Quarterly Reports on Form 10-Q and services that are normallyprovided by the independent registered public accounting firm in connectionwith statutory and regulatory filings or engagements.

 

*Audit-Related Fees*****werefor assurance and related services that are reasonably related to theperformance of the audit or review of our financial statements and are notreported under “Audit Fees.”

 

*Tax Fees*were for professional services rendered for federal, state and internationaltax compliance, tax advice and tax planning.

 

*All Other Fees*werefor services other than the services reported above and include agreed-uponprocedures in 2008.

 

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*Policy on Audit Committee Pre-Approval of Audit and PermissibleNon-Audit Services of Independent Auditors*

 

The Audit Committee pre-approves all audit andpermissible non-audit services provided by the independent registered publicaccounting firm. These services may include audit services, audit-relatedservices, tax services and other services. Pre-approval is generally providedfor up to one year, and any pre-approval is detailed as to the particularservice or category of services and is generally subject to a specific budget.The independent registered public accounting firm and management are requiredto periodically report to the Audit Committee regarding the extent of servicesprovided by the independent registered public accounting firm in accordancewith the pre-approval, and the fees for the services performed to date. TheAudit Committee may also pre-approve particular services on a case-by-casebasis.

 

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**Exhibits.**

 
| 31.1*  |   | Certification of Chief Executive Officer pursuant  to Section 302 of the Sarbanes-Oxley Act of 2002. |
|--------|--------|-----------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                      |
| 31.2*  |   | Certification of Chief Financial Officer pursuant  to Section 302 of the Sarbanes-Oxley Act of 2002. |

 

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*  Filed herewith

 

**SIGNATURES**

 

Pursuant to the requirementsof the Section 13 or 15 or 15(d) of the Securities Exchange Act of1934, the registrant has duly caused this report to be signed on its behalf bythe undersigned, thereunto duly authorized on the 30th day of April 2009.

 
|   | SUMMER INFANT, INC. |
|--------|---------------------|
|   |                |
|   |                |
|   | By:                 | /s/  JASON MACARI |
|   |                | Jason Macari |
|   |                | Chief  Executive Officer |
|   |                | (Principal  Executive Officer) |

 

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