Document:

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                                                                   EXHIBIT 10.19

                        SEPARATION AGREEMENT AND RELEASE

      Catalina Lighting, Inc. ("Catalina") and Dean Rappaport (the "Employee")
enter into this Separation Agreement and Release ("Agreement") on July 23, 2001,
in order to reach a mutually satisfactory compromise of any and all claims which
could be made arising out of or relating to the Employee's employment with
Catalina. The parties, in consideration of the premises and of the mutual
covenants and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
agree as follows:

      1. Separation. Effective on and as of July 23, 2001, (the "Separation
Date"), the Employee's employment with Catalina and with any and all other
affiliates of Catalina shall terminate.

      2. Payments. Catalina shall pay the Employee $8,333.33 on September 1,
2001. Thereafter Catalina shall pay the Employee an aggregate of $91,666.67 in
eleven consecutive quarterly payments of $8,333.33, on December 1, March 1, June
1, and September 1 of each year, beginning December 1, 2001 and ending June 1,
2004. To the extent Employee owes any sums to Catalina, pursuant to a promissory
note, or otherwise, the payments described in this Section 2 shall be retained
by Catalina to offset such amounts due. From and after the date of this
Agreement, Catalina and the Employee agree that (i) no additional interest shall
accrue on the Promissory Note between Catalina and the Employee, and (ii) the
Promissory Note is hereby amended to provide for quarterly repayments in amounts
and upon the dates provided in this Section 2 until the present balance of the
Promissory Note shall have been paid in full. To the extent that Catalina fails
to make any payment under this Section 2, the amount owing to Catalina under the
Promissory Note, or otherwise, between the Employee and Catalina shall be
reduced by the amount of any such missed payment.

      3. Employee Release. In exchange for the payments provided in Section 2,
the Employee waives and releases unconditionally, for himself and his heirs, any
and all rights, claims, demands, causes of action, obligations and liabilities
known or unknown, arising from the beginning of time to the date of execution of
this Agreement, involving his relationship with Catalina and/or any of its
affiliates or associates (each, a "Released Party"), whether such claims arise
from common law, ordinance or statute, and particularly, but without limitation
of the foregoing terms, claims concerning or relating in any way to his
employment relationship with Catalina, such as claims which may arise from or
under discrimination laws or otherwise (specifically including but not limited
to, claims under discrimination laws, the Florida Civil Rights Act of 1992, the
Florida Private Whistleblowers Act of 1991, the Miami-Dade County Equal
Opportunity Ordinance, the Age Discrimination in Employment Act, Title VII of
the Civil Rights Act of 1964, the Civil Rights Act of 1991, or any other law,
rule, ordinance or regulation) and all claims for attorneys' fees and costs,
that they may have had, now have, or in the future may have against any Released
Party or any of its officers, employees, directors,
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stockholders or agents. Employee represents and warrants that he has not made,
or caused to be made, any assignment or transfer of any claim herein being
released.

      4. Company Release. In exchange for the Employee's agreement to the terms
of this Agreement, Catalina waives and releases unconditionally, for itself and
its subsidiaries and their respective successors and assigns, any and all
rights, claims, demands, causes of action, obligations and liabilities known or
unknown, arising from the beginning of time to the date of execution of this
Agreement, involving Catalina's relationship with the Employee, whether such
claims arise from common law, ordinance or statute, and particularly, but
without limitation of the foregoing, claims concerning or relating in any way to
his employment relationship with Catalina, and all claims for attorneys' fees
and costs, that they may have had, now have, or in the future may have against
the Employee. Catalina represents and warrants that it has not made, or caused
to be made, any assignment or transfer of any claim herein being released.

      5. No Admission. The Employee agrees that this Agreement is not and shall
not be construed to be an admission of any violation of any federal, state or
local statute, ordinance or regulation, or common law, or of any duty owed the
Employee by Catalina.

      6. Employee Acknowledgment.

            (a) The Employee acknowledges that the Employee (i) has read this
Agreement, (ii) has had the opportunity to consider this Agreement, (iii) has
been advised by this document to seek legal counsel if he chooses, (iv)
understands this Agreement and all of its terms, (v) signs this Agreement
voluntarily and without duress, and (vi) signs this Agreement in exchange for
payments described in Section 2, which the Employee acknowledges are adequate
and satisfactory.

            (b) The Employee acknowledges that he was given at least twenty-one
(21) days in which to consider whether to execute this Agreement before being
required to make a decision. The Employee further acknowledges that he may
revoke the Agreement for a period of seven (7) days from the date that he
executed the Agreement.

      7. Nondisparagement.

            (a) The Employee and Catalina further agree that each will not,
directly or indirectly, disparage, harass, defame or instigate, request,
encourage, suggest, support or assist any person in disparaging, harassing or
defaming the other or any of the other's products or services, or disparage the
terms and conditions of this Agreement or the Employee's separation from
Catalina. This obligation extends to all statements, written or oral, whether
intended to be public or private.

            (b) Each of the Employee and Catalina agree and acknowledge that the
covenants and promises of this paragraph constitute a material and significant
part of the consideration received by the other in exchange for its or his
obligations to the other

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under this Agreement and that any breach of this Section 7, in any material
respect, will constitute a material breach of this Agreement.

            (c) In the event the Employee violates Section 7(a) in any material
respect, all of the amounts paid to him in Section 2 shall be forfeited.
Catalina may, in its sole discretion, either withhold said amount from any
amounts owing and unpaid under this Agreement or demand that the Employee repay
said amount within thirty (30) days of demand. If the Employee fails to repay
the amount so demanded, Catalina may file suit against the Employee for that
amount, costs and fees to be borne by the losing party. This action for recovery
of amounts paid shall not preclude Catalina or any Released Party from filing
suit against the Employee for defamation or any other cause of action related to
the disparaging statements. The Employee and Catalina submit to personal
jurisdiction in the courts of the State of Florida located in Dade County,
Florida, and the United States District Court for the Southern District of
Florida in connection with any such claims.

      8. Full Satisfaction. The Employee hereby agrees that this Agreement and
the Termination Agreement between the Employee and Catalina is in compromise and
final settlement among the parties of all disputed matters and constitutes full
satisfaction of all claims made or which could be made of whatsoever kind or
character which he has or had against all and any of the Released Parties from
the beginning of time until the date of this Agreement.

      9. No Admission of Liability. Execution of this Agreement and payment of
the amount specified in Section 2 of this Agreement does not constitute an
admission by any Released Party of any violation of any Civil Rights or other
employment discrimination statute, or any other legal statute, provision,
regulation, ordinance, order or action under common law or of any duty owed by
the Released Parties to the Employee. Rather, this Agreement expresses the
intention of the parties to resolve all issues and other claims related to or
arising out of the Employee's employment by Catalina without the time and
expense of additional contested litigation.

      10. Confidentiality.

            (a) To the extent that this Agreement is not disclosed to the public
as part of a securities filing, the Employee represents, agrees, covenants and
promises that he has not disclosed the terms of this Agreement between the
parties, including amounts, the terms and conditions of this Agreement and the
circumstances, events and records relating to this Agreement and its terms
("confidential information"). The Employee further agrees that such confidential
information shall not be disclosed or discussed by the Employee with any person
other than his immediate family, attorney, financial advisor, state, local and
federal tax authorities, or other persons as may be required by law, without the
prior written permission of Catalina unless required by law; provided, however,
that this Agreement may be used in any claim or litigation alleging breaches
thereof. Any immediate family member, attorney or other person designated above
to whom the Employee intends to disclose the confidential information shall be
instructed in

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advance by the Employee that this information is confidential and such persons
(other than state, local and federal tax authorities) shall be bound by this
same pledge of confidentiality for any disclosure of such information.

            (b) The Employee agrees and acknowledges that the covenants and
promises of this Section 10 constitute a material and significant part of the
consideration received by Catalina in exchange for the payments to the Employee
under this Agreement and that breach of this paragraph will constitute a
material breach of this Agreement.

            (c) In the event the Employee or anyone to whom the Employee
discloses the confidential information or otherwise violates Section 10(a) in
any material respect, all of the amounts paid to him in Section 2 shall be
forfeited. Catalina may, in its sole discretion, either withhold said amount
from any amounts owing and unpaid under this Agreement or demand that the
Employee repay said amount within thirty (30) days of demand. If the Employee
fails to repay the amount so demanded, Catalina may file suit against the
Employee for that amount, costs and fees to be borne by the losing party. The
Employee and Catalina submit to personal jurisdiction in the courts of the State
of Florida located in Dade County, Florida, and the United States District Court
for the Southern District of Florida in connection with any such claims.

            (d) The Employee further agrees that if ordered by a court to
produce or testify concerning the confidential information, or if served with a
subpoena or order that would compel him to produce or testify concerning the
confidential information, he will telephonically notify and provide a copy of
the subpoena or order to the then President of Catalina immediately, but in no
event any later than three (3) business days after he has been so served, for
the purpose of providing Catalina with the opportunity to obtain a protective
order against such testimony or production of this Agreement or the confidential
information.

      11. Cooperation. The Employee agrees to cooperate with Catalina by making
himself reasonably available to testify on behalf of Catalina or its affiliates,
in any action, suit or proceeding, whether civil, criminal, administrative, or
investigative, and to assist Catalina or any of its affiliates in any such
action, suit, or proceeding by providing information and meeting and consulting
with its counsel and representatives. Catalina shall provide the Employee with
reasonable notice of Catalina's need for the Employee's cooperation and shall
make all commercially reasonable efforts to ensure that Catalina will not
interrupt the Employee's then current employment or other activities. The
Employee shall be fully reimbursed for any out-of-pocket expenses reasonably
incurred by the Employee in the course of such cooperation. This Section 11
shall not apply to any litigation in which Catalina or any of its affiliates and
the Employee are adverse parties.

      12. Entire Agreement; Binding Effect. This Agreement and the Termination
Agreement and Release between the Employee and Catalina set forth the entire
agreement between the Employee and Catalina related to the Employee's separation
from employment with Catalina and the termination of Employee's

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employment and consulting agreements with Catalina. This Agreement supersedes
all of the terms of the Employee's Employment Agreement and Consulting Agreement
with Catalina, including, without limitation, the covenants contained therein
relating to confidentiality, nonsolicitation and limitations on the Employee's
ability to compete with Catalina. The Employee and Catalina intend this
Agreement to be legally binding and inure to the benefit of themselves and their
respective heirs, administrators, executors, successors and assigns.

      13. Governing Law. This Agreement shall be governed by and construed in
accordance with, the laws of the State of Florida without regard to conflict or
choice of law provisions that would defer to the substantive laws of another
jurisdiction.

      14. Attorneys' Fees. In the event of litigation to enforce or interpret
this Agreement, all litigation expenses, including by way of illustration, but
not limitation, all reasonable attorneys' fees and paralegal fees, costs and
expenses through all trials, appeals and proceeding, mediation, arbitration, any
proceedings pursuant to the bankruptcy laws of the United States, shall be paid
to the prevailing party by the non-prevailing party.

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      IN WITNESS WHEREOF, the Employee and Catalina have executed this Agreement
on the date first written above.

                                    EMPLOYEE

                                    /s/ Dean Rappaport
                                    --------------------------------------------
                                    Dean Rappaport

                                    CATALINA LIGHTING, INC.

                                    By: Robert Hersh
                                        ----------------------------------------

                                    Name: Robert Hersh

                                    Title: President and Chief Executive Officer

                                       6<PAGE>

                                                                   EXHIBIT 10.20

                        TERMINATION AGREEMENT AND RELEASE

      This TERMINATION AGREEMENT AND RELEASE (the "Agreement") is entered into
this 23rd day of July, 2001 by and between Catalina Lighting, Inc. (the
"Company") and Robert Hersh ("Employee").

      Whereas, the Company and the Employee are parties to an employment
agreement, dated October 1, 1989, as amended by amendments dated May 7, 1990,
August 27, 1990, April 8, 1991, June 10, 1992, October 1, 1993, October 1, 1994,
June 4, 1999 and September 30, 1999 (the "Employment Agreement").

      Whereas, the Company and the Employee have contemplated but not executed a
consulting and noncompetition agreement, dated September 30, 1999 (the
"Consulting Agreement").

      Whereas, the Company has entered into that certain Amended and Restated
Stock Purchase Agreement (the "Stock Purchase Agreement") dated July 23, 2001
between the Company and Sun Catalina Holdings, LLC ("Sun Catalina") and that
certain Amended and Restated Note Purchase Agreement dated July 23 2001 between
the Company and Sun Catalina (the "Note Purchase Agreement," and together with
the Stock Purchase Agreement, the "Purchase Agreements").

      Whereas, upon consummation of the transactions contemplated by the
Purchase Agreements, Sun Catalina or its affiliates will have the ability to
appoint a majority of the Board of Directors of the Company (the "Board").

      Whereas, the Employment Agreement provides for certain payments to be made
by the Company to Employee upon an Acquisition of Control as defined in the
Employment Agreement, and the consummation of the transactions contemplated by
the Purchase Agreements could constitute such an Acquisition of Control.

      Whereas, the Company and Employee desire to reach a settlement with
respect to the amounts that may be due to Employee under the Employment
Agreement and the Consulting Agreement.

      Now, therefore, in consideration of the mutual promises contained in this
Agreement and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Company and Employee agree as follows:

      1. Termination. Effective on and as of July 23 2001, (the "Termination
Date"), the Employment Agreement and the Consulting Agreement are hereby
terminated. This termination includes without limitation the cancellation of
certain
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restrictions on the Employee as set forth in Article 6 of the Employment
Agreement and Article 4 of the Consulting Agreement.

      2. Payments. In full and final settlement of any liability the Company may
have to pay any amounts to Employee under the Employment Agreement and the
Consulting Agreement, the Company shall make the payments described in this
Section 2 to Employee.

            (a) The Company shall pay the Employee the aggregate sum of $600,000
in twelve equal payments of $50,000 commencing on September 1, 2001 and seriatim
quarterly thereafter on December 1, March 1, June 1, and September 1 of each
year, beginning December 1, 2001 and ending with a final payment of $50,000 on
June 1, 2004; and

            (b) The Company shall pay the Employee the aggregate sum of $100,000
in twelve consecutive payments of $8,333.33 commencing on September 1, 2001 and
seriatim quarterly thereafter on December 1, March 1, June 1 and September 1
with a final payment of $8,333.33 on June 1, 2004. To the extent Employee owes
any sums to the Company, pursuant to a promissory note, or otherwise, the
payments described in this Section 2(b) may be retained by the Company to offset
such amounts due. The payments under paragraphs (a) and (b) are not contingent
upon the Employee's continued employment with the Company. In the event of the
Employee's death, the payments described in paragraph (a) and (b) will be
payable to the Employee's representatives, beneficiaries and heirs.

            (c) Upon the later of (i) the execution of this Agreement and the
Voting Agreement attached hereto as Exhibit A, or (ii) the approval by the
Company's shareholders of an increase in the number of authorized shares of the
Company's common stock, the Company shall grant to the Employee non-qualified
options (options that are not "incentive stock options" as that term is defined
under the Internal Revenue Code) to purchase 461,538 shares of the Company's
common stock, which options shall vest immediately. The exercise price of the
options shall be $1.18 per share. The options granted hereunder shall be fully
vested at the time of grant with an exercise period of ten (10) years from the
date of this Agreement. In the event of the Employee's death, the Employee's
options will be assignable to the Employee's heirs or beneficiaries. In the
event of any stock dividend, stock split, reverse stock split, recapitalization,
combination, reclassification or similar change in the capital structure of the
Company, appropriate adjustments shall be made to the number of the Employee's
options and to the exercise price of such options. The options will otherwise be
subject to the terms of the Company's generally applicable option grant
agreement. The options described in this paragraph (c) are not contingent upon
the Employee's continued employment with the Company.

            (d) Notwithstanding the provisions of Sections 2(a) and 2(b), the
Company shall make no payment or distribution of any kind to the Employee
pursuant to Sections 2(a) and 2(b), whether direct or indirect (by set-off or
otherwise) and whether in

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cash, securities or other property, (i) at any time during which a "senior
default" (as that term is defined in the Junior Subordination Agreement) shall
have occurred and be continuing (not waived or cured), or (ii) if after giving
effect to such payment or distribution, the Company would be in violation of
Section 8.08 of the "Senior Credit Agreement" (as that term is defined in the
Junior Subordination Agreement). Any such payment or distribution which is due
but unpaid as a result of the application of the immediately preceding sentence
shall be accrued by the Company and paid or distributed, without interest,
promptly at such time as neither of the conditions referenced in clauses (i) and
(ii) of this Section 2(d) exists. The "Junior Subordination Agreement" means
that certain Junior Subordination Agreement dated July 23 2001, by and among the
Company, the Employee and certain other parties thereto.

            (e) Notwithstanding any other provision of this Agreement to the
contrary, the Company and the Employee acknowledge and agree that in the event
that the Company, as a result of the occurrence of the conditions set forth in
Section 2(d) of this Agreement, fails to make any of the payments described in
Sections 2(a) or 2(b) of this Agreement, the Employee has the option to elect to
waive the right to receive any and all unpaid (or accrued and unpaid) payments
described in Sections 2(a) and 2(b) from the Company under this Agreement and in
Section 3 of the "New Employment Agreement" (the new employment agreement
between the Company and the Employee entered into concurrently with this
Agreement) in return for being released from the covenants described in Section
8(c) and 8(d) of the Agreement and Section 6(c) and 6(d) of the New Employment
Agreement. The Employee acknowledges and agrees that if he exercises this option
to waive the right to the aforesaid unpaid (or accrued and unpaid) payments, the
Employee has no right to bring a claim against the Company, Sun Catalina or any
of their affiliates for said payments after exercising this option. The Employee
further acknowledges and agrees that the right to be released from the covenants
in Section 8(c) and 8(d) as described in the second preceding sentence is
available to the Employee only if the failure to make a payment described in
Sections 2(a) or 2(b) is not corrected by the Company before the Employee has
elected to waive the right to receive any and all payments under this Agreement
and the New Employment Agreement.

      3. Employee Release. In exchange for the payments provided in Section 2,
the Employee waives and releases unconditionally, for himself and his heirs, any
and all rights, claims, demands, causes of action, obligations and liabilities
known or unknown, arising from the date of the Employee's commencement of
employment to the date of the execution of this Agreement, related to the
Employment Agreement and the Consulting Agreement, and all claims for attorneys'
fees and costs related thereto.

      4. Company Release. In exchange for the Employee's agreement to the terms
of this Agreement, the Company waives and releases unconditionally, for itself
and its subsidiaries and their respective successors and assigns, any and all
rights, claims, demands, causes of action, obligations and liabilities known or
unknown, arising from the date of the Employee's commencement of employment to
the date of the execution of this Agreement, related to the Employment Agreement
and the Consulting Agreement, and all claims for attorneys' fees and costs
related thereto.

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      5. Withholding Taxes. The Company may withhold from any amounts payable
under this Agreement such federal, state and local taxes as may be required to
be withheld pursuant to any applicable law or regulation.

      6. Employee Acknowledgment.

            (a) The Employee acknowledges that the Employee (i) has read this
Agreement, (ii) has had the opportunity to consider this Agreement, (iii) has
been advised by this document to seek legal counsel if he chooses, (iv)
understands this Agreement and all of its terms, (v) signs this Agreement
voluntarily and without duress, and (vi) signs this Agreement in exchange for
payments and options described in Section 2, which payments and options the
Employee acknowledges are adequate and satisfactory.

            (b) The Employee agrees that this Agreement is not and shall not be
construed to be an admission of any violation of any federal, state or local
statute, ordinance or regulation, or common law, or of any duty owed the
Employee by the Company.

      7. Full Satisfaction. The Employee hereby agrees that this Agreement is in
compromise and final settlement among the parties of all disputed matters and
constitutes full satisfaction of all claims related to the Employment Agreement
and the Consulting Agreement.

      8. Confidentiality; Nonsolicitation; Noncompetition.

            (a) The Employee covenants and agrees that he will not, in any
material respect, at any time, disclose, directly or indirectly, or make
available to any person, corporation, firm, or other entity, or in any manner
use for his own benefit, any confidential information or trade secrets relating
to the business and operations of the Company, any of its subsidiaries or any of
their respective affiliates (collectively, the "Group"), including, without
limitation, business strategies, operating plans, acquisition strategies
(including the identities of (and any other information concerning) possible
acquisition candidates), pro forma financial information, market analysis,
acquisition terms and conditions, personnel information, product information,
sources of leads and methods of obtaining new business, know-how, customer lists
and relationships, supplier lists and relationships, distribution methods or any
other methods of doing and operating the business of the Group, or other
proprietary, trade secret and confidential information relating to the Group,
except to the extent that such disclosure (i) is made with the Board's written
consent, (ii) relates to information that is or becomes generally known by the
public other than as a result of a breach hereof, or (iii) is required to be
disclosed by law or judicial or administrative process; provided that, in the
case of clause (iii), the Employee provides the Company with prompt prior
written notice of such requirement and the terms of and circumstances
surrounding such requirement so that the Company may seek an appropriate
protective order or other remedy, or waive compliance with the terms of this
Agreement, and the Employee shall provide such cooperation with respect

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to obtaining a protective order or other remedy as the Company shall reasonably
request. If a protective order or other remedy is not obtained, or if the
Company is required to waive compliance with the provisions hereof, the Employee
will furnish only that portion of such confidential information or trade secrets
which, as he is advised in a written opinion by his counsel, he is legally
required to furnish.

            (b) The Employee covenants and agrees that for a period of three (3)
years from the date of this Agreement, the Employee shall not, either directly
or indirectly, for himself or on behalf of any other person, firm or entity,
employ, engage, retain or enter into a business affiliation with any person who
at any time during the twelve-month period preceding the execution of this
Agreement was an employee of, or consultant to, the Group for the purpose of
soliciting or diverting any such employee or consultant from the Group or
otherwise interfering with the business relationship of the Group with any of
the foregoing.

            (c) The Employee covenants and agrees that for a period of three (3)
years from the date of this Agreement, the Employee shall not, either directly
or indirectly, for himself or on behalf of any other person, firm or entity,
employ, engage, retain or enter into a business affiliation with any person who
at any time during the twelve-month period preceding the execution of this
Agreement was a supplier or customer of the Group for the purpose of diverting
any such supplier or customer from the Group or otherwise interfering with the
business relationship of the Group with any of the foregoing.

            (d) The Employee covenants and agrees that for a period three (3)
years from the date of this Agreement, the Employee shall not, either directly
or indirectly, alone or as a partner, joint venturer, officer, director,
employee, lender, consultant, agent, independent contractor, stockholder or
otherwise, or permit any company or business organization directly or indirectly
controlled by him or any of his affiliates to, engage in any of the businesses
actually conducted by the Company or any of its subsidiaries (or any businesses
actively explored by the Company or any of its subsidiaries for the purpose of
conducting) in any place where the Company or any of its subsidiaries presently
conducts business or has conducted business (or has at any time actively
explored conducting businesses) during the two years preceding the execution of
this Agreement. The passive ownership by the Employee or his affiliates, of not
more than three percent (3%) of the shares of capital stock of any corporation
having a class of equity securities actively traded on a national securities
exchange or in the over-the-counter market shall not be deemed, in and of
itself, to violate the prohibitions of this paragraph.

            (e) The Employee acknowledges that the agreements of this Section 8
are reasonable and necessary for the protection of the Company and the Group and
are an essential inducement to the Company's entering into this Agreement.
Accordingly, the Employee shall be bound by the provisions of this Agreement
(including the provisions of this Section 8) to the maximum extent permitted by
law, it being the intent and spirit of the parties that the foregoing shall be
fully enforceable. However, the parties further agree that, if any of the
provisions hereof shall for any reason be held to be excessively

                                       5
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broad as to duration, geographical scope, property or subject matter, such
provision shall be construed by limiting and reducing it so as to be enforceable
to the extent compatible with the applicable law as it shall herein pertain.

      9. Cooperation in Litigation; Waiver of Trial By Jury.

            (a) The Employee agrees to cooperate with the Company by making
himself reasonably available to testify on behalf of the Company or its
affiliates, in any action, suit or proceeding, whether civil, criminal,
administrative, or investigative, and to assist the Company or any of its
affiliates in any such action, suit, or proceeding by providing information and
meeting and consulting with its counsel and representatives. The Employee shall
be fully reimbursed for any out-of-pocket expenses reasonably incurred by the
Employee in the course of such cooperation.

            (b) Each of the parties to this Agreement irrevocably and
unconditionally waives the right to a trial by jury in any action, suit or
proceeding.

      10. Entire Agreement; Binding Effect. This Agreement sets forth the entire
agreement between the Employee and the Company related to the termination of
Employee's Employment Agreement and Consulting Agreement with the Company. As
such, this Agreement supersedes all of the terms of the Employee's Employment
Agreement and Consulting Agreement with the Company, including, without
limitation, the covenants contained therein relating to confidentiality,
nonsolicitation and limitations on the Employee's ability to compete with the
Company. The Employee and the Company intend this Agreement to be legally
binding and inure to the benefit of themselves and their respective heirs,
administrators, executors, successors and assigns.

      11. Indemnification. The Company agrees to indemnify, hold harmless and
defend, the Employee, in and for any and all claims, losses, penalties, fines,
forfeitures, legal fees and related costs, judgments and any other costs, fees
and expenses ("Claims") in any way related to the Employee's prior or present
employment by the Company or in his capacity as an officer or director of the
Company, other than Claims attributable to or resulting from unlawful conduct of
the Employee or actions or inactions of the Employee constituting fraud, gross
negligence, bad faith, willful misconduct or a violation of the Company's
established policies. Within five (5) business days after being served with any
action in respect of any claim based upon the Employee's prior or present
employment by the Company or in his capacity as an officer or director of the
Company, the party who has been served shall give written notice of the action
to the other, which notice shall include full copies of all pleadings. The
Employee shall be entitled to participate in the defense of any such action, and
shall be copied and kept reasonably informed of the progress by the Company. No
settlement, compromise or other disposition of the action shall be made on the
Employee's behalf without the prior written consent of the Employee, which
consent shall not be unreasonably withheld. Upon written demand the Company
shall advance to or on behalf of the Employee all payments and such other sums
as may be required to satisfy the Company's obligations of indemnification,
including payment of costs and expenses currently as they are incurred

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by the Employee; provided that the Company shall be entitled to prompt
reimbursement of such payments, costs and expenses in the event that it is later
determined that such Claims are not eligible for indemnification as described in
the first sentence of this paragraph. This Section is not intended to and shall
not create rights in favor of any insurance carrier.

      12. Attorneys' Fees. In the event of litigation to enforce or interpret
this Agreement, all litigation expenses, including by way of illustration, but
not limitation, all reasonable attorneys' fees and paralegal fees, costs and
expenses through all trials, appeals and proceeding, mediation, arbitration, any
proceedings pursuant to the bankruptcy laws of the United States, shall be paid
to the prevailing party by the non-prevailing party.

      13. Governing Law. This Agreement shall be governed by and construed in
accordance with, the laws of the State of Florida without regard to conflict or
choice of law provisions that would defer to the substantive laws of another
jurisdiction.

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     IN WITNESS WHEREOF, the Employee and the Company have executed this
Agreement on the date first written above.

                                        EMPLOYEE

                                          /s/ Robert Hersh
                                        ----------------------------------------
                                        Robert Hersh

                                        CATALINA LIGHTING, INC.

                                        By: /s/ David W. Sasnett
                                           -------------------------------------

                                        Name:  David W. Sasnett
                                             -----------------------------------

                                        Title: Chief Financial Officer
                                              ----------------------------------

                                       8

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