Document:

<PAGE>   1
                                                                  Exhibit 10.1.5

                               FIFTH AMENDMENT TO
          SECOND AMENDED AND RESTATED FINANCING AND SECURITY AGREEMENT
              AND FIRST AMENDMENT TO NOTE PARTICIPATION AGREEMENTS
          ------------------------------------------------------------

         THIS FIFTH AMENDMENT TO SECOND AMENDED AND RESTATED FINANCING AND
SECURITY AGREEMENT AND FIRST AMENDMENT TO NOTE PARTICIPATION AGREEMENTS (this
"Agreement") is made as of the 27th day of March, 2001, by and among

     AAi.FOSTERGRANT, INC. (formerly known as Accessories Associates, Inc.), a
corporation organized and existing under the laws of the State of Rhode Island,
successor in interest to Foster Grant Group, L.P., F.G.G. Investments, Inc., The
Bonneau Company, Bonneau Holdings, Inc., Bonneau General, Inc., Foster Grant
Holdings, Inc., and O-Ray Holdings, Inc. (the "Borrower");

     FANTASMA, LLC, a limited liability company organized under the laws of the
State of Delaware ("Fantasma") (Fantasma together with the Borrower, the
"Obligors");

     WESTON PRESIDIO CAPITAL II, L.P., a limited partnership organized and
existing under the laws of the State of Delaware, BANCBOSTON VENTURES, INC., a
corporation organized and existing under the laws of the State of Delaware, ST.
PAUL VENTURE CAPITAL V, LLC, a limited liability company organized and existing
under the laws of the State of Delaware, NATIONAL CITY CAPITAL CORPORATION, a
corporation organized and existing under the laws of the State of Delaware,
MARLIN CAPITAL, L.P., a limited partnership organized and existing under the
laws of the State of Delaware (the "SNR Participants");

     BANK OF AMERICA, N.A., a national banking association ("Bank of America"),
formerly NationsBank, N.A., and each other financial institution which is party
to the Financing Agreement (as that term is defined below) from time to time
(collectively, the "Lenders" and individually, a "Lender"); and

     BANK OF AMERICA, N.A., a national banking association (the "Agent"),
formerly NationsBank, N.A., in its capacity as both collateral and
administrative agent for each of the Lenders.

                                    RECITALS
                                    --------

     A. The Borrower, the Guarantors, the Lenders and the Agent entered into a
Second Amended and Restated Financing and Security Agreement dated July 21, 1998
(as amended by that certain First Amendment to Second Amended and Restated
Financing and Security Agreement dated as of May 7, 1999, Second Amendment to
Second Amended and Restated Financing and Security Agreement dated as of March
24, 2000, Third Amendment to Second Amended and Restated Financing and Security
Agreement dated as of June 12, 2000 (the "Third Amendment"), Fourth Amendment to
Second Amended and Restated Financing and Security Agreement dated as of August
14, 2000 (the "Fourth Amendment") and as further amended, restated, modified,
substituted, extended, and renewed from time to time, the "Financing
Agreement"). The Financing Agreement provides for some of the agreements among
the

                                       1
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Borrower, the Guarantors, the Lenders and the Agent with respect to the
"Loan" (as defined in the Financing Agreement), including the Revolving Credit
Facility (as that term is defined in the Financing Agreement) in an amount not
to exceed $60,000,000 and the Letter of Credit Facility which is part of the
Revolving Credit Facility.

     B. Under and subject to the provisions of the Financing Agreement, the SNR
Lender (as defined in the Financing Agreement) agreed to make a loan to the
Borrower (the "SNR Loan") in a principal amount of $7,097,875. Pursuant to SNR
Participation Agreements, the SNR Lender sold, assigned and conveyed to the SNR
Participants and the SNR Participants purchased, acquired and took from the SNR
Lender an undivided participating interest in the SNR Loan made by the SNR
Lender under the Financing Agreement.

     C. The Borrower has requested that the Agent and Lenders waive certain
financial covenant defaults, amend certain financial covenant provisions of the
Financing Agreement and amend certain other provisions of the Financing
Agreement.

     D. The Agent and Lenders are willing to agree to the Borrower's request on
the condition, among others, that this Agreement be executed.

                                   AGREEMENTS
                                   ----------

         NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, receipt of which is hereby acknowledged, the Borrower,
the Guarantors, the Lenders and Agent agree as follows:

     1. The Obligors, the Lenders and the Agent agree that the Recitals above
are a part of this Agreement. Unless otherwise expressly defined in this
Agreement, terms defined in the Financing Agreement shall have the same meaning
under this Agreement.

     2. Each of the Borrower and Fantasma represents and warrants to the Lenders
and Agent as follows:

         (a) The Borrower is a corporation duly organized, and validly existing
and in good standing under the laws of the state in which it was organized and
is duly qualified to do business as a foreign corporation in good standing in
every other state wherein the conduct of its business or the ownership of its
property requires such qualification.

         (b) Fantasma is a limited liability company duly organized, validly
existing and in good standing under the laws of the state in which it was
organized and is duly qualified to do business as a foreign limited partnership
in every other state wherein the conduct of its business or the ownership of its
property requires such qualification.

         (c) Each of the Borrower and Fantasma has the power and authority to
execute and deliver this Agreement and perform its obligations hereunder and has
taken all necessary and appropriate corporate, partnership or limited liability
company action, as applicable, to authorize the execution, delivery and
performance of this Agreement.

                                       2
<PAGE>   3

         (d) The Financing Agreement, as amended by this Agreement, and each of
the other Financing Documents remains in full force and effect, and each
constitutes the valid and legally binding obligation of the Borrower and
Fantasma, enforceable in accordance with its terms.

         (e) All of the Borrower's and Fantasma's representations and warranties
contained in the Financing Agreement and the other Financing Documents are true
and correct on and as of the date of the Borrower's and Fantasma's execution of
this Agreement.

         (f) After giving effect to this Agreement, no Event of Default and no
event which, with notice, lapse of time or both would constitute an Event of
Default, has occurred and is continuing under the Financing Agreement or the
other Financing Documents which has not been waived in writing by the Lenders
and Agent.

     3. Section 1.1 of the Financing Agreement (Certain Defined Terms) is hereby
amended by deleting the definition of "Fixed Charges" in its entirety and
substituting the following:

               "FIXED CHARGES" MEANS FOR ANY PERIOD OF DETERMINATION THEREOF,
          THE SUM OF (a) SCHEDULED OR REQUIRED PAYMENTS (INCLUDING, WITHOUT
          LIMITATION, PRINCIPAL AND INTEREST) ON ALL INDEBTEDNESS FOR BORROWED
          MONEY OF THE BORROWER AND ITS SUBSIDIARIES, PLUS (b) CAPITAL
          EXPENDITURES MADE IN CASH (AND PERMITTED ACQUISITIONS TO THE EXTENT
          NOT INCLUDED IN CAPITAL EXPENDITURES) OF THE BORROWER AND ITS
          SUBSIDIARIES, (c) PLUS CASH PAYMENTS OF TAXES, PLUS (d) WITHOUT
          DUPLICATION, DIVIDENDS, DISTRIBUTIONS, AND REPURCHASES, REDEMPTIONS
          (EXCLUDING THE $1,000,000 PAYMENT MADE ON APRIL 3, 2000 IN CONNECTION
          WITH THE REDEMPTION OF THE PREFERRED SHARES RELATING TO THE
          ACQUISITION OF FOSTER GRANT) AND OTHER TRANSACTIONS REGARDING EQUITY
          PAID TO SHAREHOLDERS INCLUDING, WITHOUT LIMITATION, PERMITTED
          AFFILIATE DISTRIBUTIONS, OTHER THAN PERMITTED AFFILIATE DISTRIBUTIONS
          MADE BY ONE BORROWER TO ANOTHER BORROWER.

     4. Section 6.1.13 of the Financing Agreement (Financial Covenants) is
hereby deleted in its entirety and the following is substituted in its place:

               6.1.13 FINANCIAL COVENANTS.

               (a) FIXED CHARGE COVERAGE RATIO. THE BORROWER AND ITS
          SUBSIDIARIES ON A CONSOLIDATED BASIS WILL MAINTAIN, TESTED ON THE LAST
          BUSINESS DAY OF EACH OF THE BORROWER'S FISCAL QUARTERS BEGINNING ON
          THE LAST BUSINESS DAY OF THE FISCAL QUARTER ENDING CLOSEST TO MARCH
          31, 2001, FOR THE FOUR (4) QUARTER PERIOD ENDING ON SUCH DATE, A FIXED
          CHARGE COVERAGE RATIO OF NOT LESS THAN THE FOLLOWING:

                                       3
<PAGE>   4

------------------------------------------------ ------------------------------

       FISCAL QUARTER ENDING CLOSEST TO:                     RATIO
------------------------------------------------ ------------------------------
MARCH 31, 2001                                            .90 TO 1.0
------------------------------------------------ ------------------------------
JUNE 30, 2001                                             1.00 TO 1.0
------------------------------------------------ ------------------------------
SEPTEMBER 30, 2001                                        1.00 TO 1.0
------------------------------------------------ ------------------------------
DECEMBER 31, 2001                                         1.00 TO 1.0
------------------------------------------------ ------------------------------
MARCH 31, 2002 THROUGH AND                                1.05 TO 1.0
INCLUDING DECEMBER 31, 2002
------------------------------------------------ ------------------------------
MARCH 31, 2003 THROUGH AND                                1.10 TO 1.0
INCLUDING DECEMBER 31, 2003
AND THEREAFTER
------------------------------------------------ ------------------------------

               (b) LEVERAGE RATIO. THE BORROWER AND ITS SUBSIDIARIES ON A
          CONSOLIDATED BASIS WILL AT ALL TIMES MAINTAIN, TESTED AS OF THE LAST
          BUSINESS DAY OF EACH OF BORROWER'S FISCAL QUARTERS BEGINNING WITH THE
          FISCAL QUARTER ENDING CLOSEST TO MARCH 31, 2001, AS OF THE LAST DAY OF
          EACH OF THE BORROWER'S FISCAL QUARTERS FOR THE FOUR (4) QUARTER PERIOD
          ENDING ON SUCH DATE, A RATIO OF FUNDED DEBT TO EBITDA SO THAT IT IS
          NOT MORE THAN THE FOLLOWING:

------------------------------------------------- ------------------------------
       FISCAL QUARTER ENDING CLOSEST TO:                      RATIO
------------------------------------------------- ------------------------------
MARCH 31, 2001                                             5.20 TO 1.0
------------------------------------------------- ------------------------------
JUNE 30, 2001                                              4.50 TO 1.0
------------------------------------------------- ------------------------------
SEPTEMBER 30, 2001                                         4.50 TO 1.0
------------------------------------------------- ------------------------------
DECEMBER 31, 2001                                          4.20 TO 1.0
------------------------------------------------- ------------------------------
MARCH 31, 2002 AND THEREAFTER                              4.00 TO 1.0
------------------------------------------------- ------------------------------

               (c) EBITDA. THE BORROWER AND ITS SUBSIDIARIES ON A CONSOLIDATED
          BASIS WILL MAINTAIN, TESTED ON THE LAST BUSINESS DAY OF EACH OF THE
          BORROWER'S FISCAL QUARTERS BEGINNING ON THE LAST BUSINESS DAY OF THE
          FISCAL QUARTER ENDING CLOSEST TO MARCH 31, 2001 FOR THE FOUR

                                       4
<PAGE>   5

          (4) QUARTER PERIOD ENDING ON SUCH DATE, EBITDA OF NOT LESS THAN THE
          FOLLOWING:

================================================================================
      FISCAL QUARTER ENDING CLOSEST TO:                     AMOUNT
--------------------------------------------------------------------------------
               MARCH 31, 2001                             $17,000,000
--------------------------------------------------------------------------------
                JUNE 30, 2001                             $19,500,000
--------------------------------------------------------------------------------
             SEPTEMBER 30, 2001                           $18,000,000
--------------------------------------------------------------------------------
              DECEMBER 31, 2001                           $18,600,000
--------------------------------------------------------------------------------
          MARCH 31, 2002 THROUGH AND                      $19,500,000
         INCLUDING DECEMBER 31, 2002
--------------------------------------------------------------------------------
        MARCH 31, 2003 AND THEREAFTER                     $20,500,000
================================================================================

     5. Section 6.2.7 of the Financing Agreement (Capital Expenditures) is
hereby deleted in its entirety and the following is substituted in its place:

               THE BORROWER AND FANTASMA WILL NOT, DIRECTLY OR INDIRECTLY (BY
          WAY OF THE ACQUISITION OF THE SECURITIES OF A PERSON OR OTHERWISE),
          MAKE ANY CAPITAL EXPENDITURES (EXCLUDING, HOWEVER, ANY BUYBACKS
          OTHERWISE INCLUDED AS A CAPITAL EXPENDITURE) IN THE AGGREGATE FOR THE
          BORROWER, FOSTER GRANT AND FANTASMA (TAKEN AS A WHOLE) FOR (i) FISCAL
          YEAR ENDING DECEMBER 31, 2001, EXCEEDING $8,500,000, EXCEPT THE
          PURCHASE AND SALE/LEASEBACK OF THE HEADQUARTER'S PROPERTY AND FOR (ii)
          FISCAL YEAR ENDING DECEMBER 31, 2002 AND FOR ANY FISCAL YEAR
          THEREAFTER, EXCEEDING $9,000,000, EXCEPT THE PURCHASE AND
          SALE/LEASEBACK OF THE HEADQUARTER'S PROPERTY.

     6. Section 8(a) of the Fourth Amendment is hereby amended to change the
reference to "After February 28, 2001 and before April 15, 2001" to "After
February 28, 2002 and before April 15, 2002."

     7. The SNR Participants, the SNR Lender and the Borrower agree that Section
2.3(a) of the SNR Participation Agreements (as that term is defined in the Loan
Agreement) is hereby amended to change the reference to "After February 28, 2001
and before April 15, 2001" to "After February 28, 2002 and before April 15,
2002." The SNR Participants, respectively, hereby issue, ratify and confirm the
representations, warranties and covenants contained in the respective SNR
Participation Agreements, as amended hereby, and agree that the respective SNR
Participation Agreements continue in full force and effect.

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<PAGE>   6

     8. The Agent and the Lenders hereby acknowledge and permit the release of
the Lenders' lien on and security interest in certain collateral that is being
sold pursuant to Purchase Agreement by and between Fantasma, LLC, as seller, and
M.Z. Berger & Co., Inc. to be dated as of March 29, 2001 (the "Purchase
Agreement"). The Obligors hereby agree that the proceeds received under the
Purchase Agreement will be applied to the Revolving Credit Facility.

     9. The Obligors, as applicable, hereby issue, ratify and confirm the
representations, warranties and covenants contained in the Financing Agreement,
as amended hereby. The Obligors agree that this Agreement is not intended to and
shall not cause a novation with respect to any or all of the Obligations.

     10. On the condition that the Obligors shall have complied with the terms
and conditions of this Agreement, the Agent and Lenders hereby waive defaults
under the following provisions of the Financing Agreement which, prior to the
execution of this Agreement or for the period stated, existed under the
Obligations; provided, however that this Paragraph shall not be deemed to waive
any defaults under the following provisions after the date of this Agreement or
after the period stated, or any other defaults arising as a result of
non-compliance by the Borrower with the Financing Agreement, whether or not the
events, facts or circumstances giving rise to such non-compliance existed on or
prior to the date hereof:

       SECTION             DEFAULT
       -------             -------

       6.1.13(b)           Failure of Borrower to maintain the Leverage Ratio
                           required by Section 6.1.13(b) for Fiscal Year period
                           ending December 31, 2000

       6.1.13(c)           Failure of Borrower to maintain EBITDA as required by
                           Section 6.1.13(c) for Fiscal Year period ending
                           December 31, 2000

     11. The Obligors acknowledge and warrant that the Agent and Lenders have
acted in good faith and have conducted in a commercially reasonable manner their
relationships with the Obligors in connection with this Agreement and generally
in connection with the Financing Agreement and the Obligations, the Obligors
hereby waiving and releasing any claims to the contrary.

     12. The Obligors shall pay at the time this Agreement is executed and
delivered all fees, commissions, costs, charges, taxes and other expenses
incurred by the Agent and Lenders and their counsel in connection with this
Agreement, including, but not limited to, reasonable fees and expenses of the
Agent's counsel and all recording fees, taxes and charges.

     13. As a condition of the Agent's and the Lenders' agreement to enter into
this Agreement, the Obligors hereby agree to pay to the Agent and the Lenders an
amendment fee equal to $75,000, which fee shall be due and payable at the time
this Agreement is executed and is fully earned and non-refundable upon payment.

     14. This Agreement may be executed in any number of duplicate originals or
counterparts, each of such duplicate originals or counterparts shall be deemed
to be an original

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and taken together shall constitute but one and the same instrument. The parties
agree that their respective signatures may be delivered by facsimile. Any party
who chooses to deliver its signature by facsimile agrees to provide a
counterpart of this Agreement with its inked signature promptly to each other
party.

         IN WITNESS WHEREOF, the Obligors, the SNR Participants, the Lenders and
the Agent have executed this Agreement under seal as of the date and year first
written above on the pages that follow.

                  [SIGNATURES TO APPEAR ON THE FOLLOWING PAGES]

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                                 Signature Page

                               Fifth Amendment to
                           Second Amended and Restated
                        Financing and Security Agreement

                                      among

 AAi.FOSTERGRANT, INC. and certain of its affiliates, BANK OF AMERICA, N.A.(in
  its capacity as "Agent"), and BANK OF AMERICA, N.A. and the other financial
     institutions which are parties to the Financing Agreement as "Lenders"

                                       AAi.FOSTERGRANT, INC. (formerly known as
                                       Accessories, Associates, Inc.)

                                       By: /s/ Mark Kost                 (SEAL)
                                           ------------------------------------
                                           Mark Kost
                                           Chief Financial Officer

                                       FANTASMA, LLC

                                       By: /s/ Mark Kost                 (SEAL)
                                           ------------------------------------
                                           Mark Kost
                                           Chief Financial Officer

                                      S-1
<PAGE>   9

                                 Signature Page

                 Fifth Amendment to Second Amended and Restated
                        Financing and Security Agreement

                                      among

   AAi.FOSTERGRANT, INC. and certain of its affiliates, BANK OF AMERICA, N.A.
(in its capacity as "Agent"), and BANK OF AMERICA, N.A. and the other financial
     institutions which are parties to the Financing Agreement as "Lenders"

                                              WESTON PRESIDIO CAPITAL II, L.P.

                                              By: /s/ Michael Cronin
                                                 -----------------------------
                                                 Name:
                                                 Title:

                                      S-2
<PAGE>   10

                                 Signature Page

                 Fifth Amendment to Second Amended and Restated
                        Financing and Security Agreement

                                      among

   AAi.FOSTERGRANT, INC. and certain of its affiliates, BANK OF AMERICA, N.A.
(in its capacity as "Agent"), and BANK OF AMERICA, N.A. and the other financial
     institutions which are parties to the Financing Agreement as "Lenders"

                                               BANCBOSTON VENTURES, INC.

                                               By: /s/ Charles Grant
                                                  ------------------------------
                                                  Name:
                                                  Title:

                                      S-3
<PAGE>   11

                                 Signature Page

                 Fifth Amendment to Second Amended and Restated
                        Financing and Security Agreement

                                      among

   AAi.FOSTERGRANT, INC. and certain of its affiliates, BANK OF AMERICA, N.A.
(in its capacity as "Agent"), and BANK OF AMERICA, N.A. and the other financial
     institutions which are parties to the Financing Agreement as "Lenders"

                                             ST. PAUL VENTURE CAPITAL V, LLC

                                             By: /s/ Everett Cox
                                                ----------------------------
                                                Name:
                                                Title:

                                      S-4
<PAGE>   12

                                 Signature Page

                 Fifth Amendment to Second Amended and Restated
                        Financing and Security Agreement

                                      among

   AAi.FOSTERGRANT, INC. and certain of its affiliates, BANK OF AMERICA, N.A.
(in its capacity as "Agent"), and BANK OF AMERICA, N.A. and the other financial
     institutions which are parties to the Financing Agreement as "Lenders"

                                             NATIONAL CITY CAPITAL CORPORATION

                                             By: /s/ Tod McQuaig
                                                ------------------------------
                                                Name:
                                                Title:

                                      S-5
<PAGE>   13

                                 Signature Page

                 Fifth Amendment to Second Amended and Restated
                        Financing and Security Agreement

                                      among

   AAi.FOSTERGRANT, INC. and certain of its affiliates, BANK OF AMERICA, N.A.
(in its capacity as "Agent"), and BANK OF AMERICA, N.A. and the other financial
     institutions which are parties to the Financing Agreement as "Lenders"

                                                 MARLIN CAPITAL, L.P.

                                                 By: /s/ Martin Franklin
                                                    ----------------------------
                                                    Name:
                                                    Title:

                                      S-6
<PAGE>   14

                                 Signature Page

                 Fifth Amendment to Second Amended and Restated
                        Financing and Security Agreement

                                      among

   AAi.FOSTERGRANT, INC. and certain of its affiliates, BANK OF AMERICA, N.A.
(in its capacity as "Agent"), and BANK OF AMERICA, N.A. and the other financial
     institutions which are parties to the Financing Agreement as "Lenders"

                                             BANK OF AMERICA, N.A., Agent

                                             By: /s/ Gary W. Bartlett     (SEAL)
                                                --------------------------------
                                                Gary W. Bartlett
                                                Vice President

                                             BANK OF AMERICA, N.A.
                                             in its capacity as a Lender

                                             By: /s/ Gary W. Bartlett     (SEAL)
                                                --------------------------------
                                                Gary W. Bartlett
                                                Vice President

                                      S-7
<PAGE>   15

                                 Signature Page

                 Fifth Amendment to Second Amended and Restated
                        Financing and Security Agreement

                                      among

   AAi.FOSTERGRANT, INC. and certain of its affiliates, BANK OF AMERICA, N.A.
(in its capacity as "Agent"), and BANK OF AMERICA, N.A. and the other financial
     institutions which are parties to the Financing Agreement as "Lenders"

                                            LASALLE BUSINESS CREDIT, INC.

                                            By: /s/ Thomas A. Buckelew    (SEAL)
                                                --------------------------------
                                                Thomas A. Buckelew
                                                Vice President

                                      S-8
<PAGE>   16

                                 Signature Page

                 Fifth Amendment to Second Amended and Restated
                        Financing and Security Agreement

                                      among

   AAi.FOSTERGRANT, INC. and certain of its affiliates, BANK OF AMERICA, N.A.
(in its capacity as "Agent"), and BANK OF AMERICA, N.A. and the other financial
     institutions which are parties to the Financing Agreement as "Lenders"

                                               PNC BANK, NATIONAL ASSOCIATION

                                               By: /s/ Rose Crump         (SEAL)
                                                   -----------------------------
                                                   Rose Crump
                                                   Vice President

                                      S-9<PAGE>   1
Exhibit 10.19

                                                               December 22, 2000

Ms. Babette  Lienhard
23 Riverbank Ct.
Weston, CT  06883

Dear Babette:

I am delighted to formally extend to you our offer to join the AAi.FosterGrant
team. Everyone on our team enjoyed meeting you and is excited about your joining
us. You are the last piece in the puzzle to growth and prosperity. As I am sure
you heard from all of us, this is an exciting place to work with lots of
challenges and a great opportunity to contribute to the success of the company!

This letter summarizes the offer of employment made to you by AAi.FosterGrant,
Inc. ("Company") and is valid until December 22, 2000.

      1.    POSITION: Executive Director - Merchandising

      2.    REPORTING RELATIONSHIP: President & CEO.

      3.    PRIMARY RESPONSIBILITIES: You have full responsibility for the
            Company's Merchandising, including sell thru, markdowns, gross
            margins and inventory.

      4.    BASE SALARY: Your base salary will be $3846.15 weekly ($200,000
            annualized)

      5.    BENEFITS: As a full time employee of the Company you will become
            eligible for our RISA benefits programs as are in effect from time
            to time, including, but not limited to:

            -     Medical and Dental insurance

            -     Life insurance

            -     401(k) program after one year of service

            -     PTO program accruing at a rate of 20 days per year

            A summary of our current benefits is enclosed for your review.

      6.    ANNUAL BONUS: You will participate in the FY `01 performance bonus
            plan at the 30% base salary level based equally on your attainment
            of personal goals and the Company's performance against annual
            corporate business goals.

      7.    STOCK OPTIONS: As a corporate executive you will be eligible to
            participate in a future Long Term Incentive plan, which as
            discussed, is currently under discussion.

<PAGE>   2

      8.    PERFORMANCE REVIEW: In accordance with company policy you will be
            given a ninety (90) day non-financial review. A one (1) year
            performance and salary review will be given on or about one (1) year
            from your date of hire and every year thereafter.

      9.    PROPRIETARY RIGHTS/NON-COMPETITION: Attachment A shall apply.

      10.   RELOCATION: AAi.FosterGrant will reimburse up to $25,000 gross for
            relocation expenses.

      11.   ANTICIPATED START DATE: December 29, 2000 with a reporting date of
            January 2, 2001

If you are in agreement with the foregoing, please signify by signing below and
at Attachment B.

Babette, I believe that you have the skills, experience, intellect and energy
level that will make you a successful team player at AAi.FosterGrant. I look
forward to your participation in this process and to working with you.

Sincerely,

AAi.FosterGrant, Inc.                               Agreed and Accepted:

By /s/ John R. Ranelli                              /s/ Babette A. Lienhard
  --------------------------------                  ----------------------------
John R. Ranelli                                     Babette A. Lienhard
President/CEO

Encl:  Benefits Summary//I-9 Form

--------------------------------------------------------------------------------
* AAi.Foster Grant, Inc. Verifies the identity and employment authorization of
all new hires, pursuant to the Immigration and Nationality Act. In order to
comply with this legal obligation, we must complete and Employment Eligibility
form for your review within three days of hire. Enclosed is an I-9 form for your
review. Please note that you will need to provide one document from "List A" OR
one document from "List B" AND one document from "List C" of the form. If you
have any questions, please contact Mike Cassani, AAi.FosterGrant, Inc.
--------------------------------------------------------------------------------

<PAGE>   3

ATTACHMENT A

                  PROPRIETARY RIGHTS/NON-COMPETITION AGREEMENT

         For purposes of this Agreement, the following are collectively referred
to as "Company": AAi.FosterGrant, Inc. and any other corporation, entity or
person, now or hereafter controlled by, controlling or under common control with
Company. "I" shall mean Babette Lienhard.

         I acknowledge that (1) Company is in the business of providing jewelry,
small leather goods, reading glasses and sunglasses and other accessories sales
and services to numerous customers, and expends significant resources in
developing, marketing and selling its services and products, and in developing
information which is not generally known to others and which is entitled to
protection from improper disclosure and use; (2) I will occupy a position of
special value to Company and, in the discharge of duties customary to that
position, I will have access to Company's vital and unique business information
which allows Company to gain a competitive edge over competitors; and (3) I will
have close, regular contact and relationships with Company's other employees
and, because of the personal nature thereof, such employees will develop
identification with me, rather than the Company itself, could create the
potential for my appropriation of such relationships developed on Company's
behalf and expense.

         I further acknowledge that an essential element of maintaining
Company's relationships with its customers is the development and maintenance of
personal contacts with vendor and customer personnel who are responsible for
obtaining Company services and products and, towards that end, Company (1)
encourages employees, including me, to become personally acquainted with vendor
and customer personnel and (2) provides employees, including me, access to
information gathered by Company about vendors and customers. This policy
represents a significant, costly investment by Company, to the extent additional
manpower is necessary to develop such contacts and relationships and gather such
information. Because of the personal nature of such contacts and relationships,
Company's vendors and customers commonly develop identification with employees,
including me, rather than Company itself. Such identification creates potential
for my appropriation of the benefits of relationships developed with vendors and
customers on Company's behalf and expense.

        In this Agreement, Company's information, data and knowledge is known as
Proprietary Materials. It includes such information, data and knowledge
developed or obtained by or on behalf of Company relating to, used in connection
with or reasonably likely to be useful to any of Company's businesses, ventures,
research, investigations or activities, including but not limited to all of
Company's products, discoveries, ideas, inventions, methods, improvements,
concepts, developments, methods, designs, drawings, works, processes, know-how,
computer programs, internal policies and procedures, vendors, customers,
contacts, prospects, financial information, business records, marketing
practices and any papers labeled "secret," "confidential," or "proprietary," as
well as any confidential information of any of Company's customers provided to
Company. I understand that each of the foregoing constitutes Proprietary
Materials even if conceived, made, developed, created or first reduced to
practice by me during my term of employment with Company, and whether or not (1)
I did so at the request or suggestion of Company, (2) they resulted from or were
suggested by any work that I have performed or may perform for Company, (3) I
did the work alone or in conjunction with others, (4) I did the work during
regular hours of work or otherwise, or at Company's place of business or
elsewhere, and (5) the Proprietary Materials are patentable or copyrightable by
me or someone else. Notwithstanding the foregoing, Company and I agree that
Proprietary Materials will not include any information, data or knowledge that I
can establish by written evidence as having been conceived, made or reduced to
practice by me which was created or conceived without use of Company resources,
outside of regular Company business hours and that is unrelated to or reasonably
unlikely to be useful to Company.

         In order to provide greater comfort to Company that it can continue to
share its Proprietary Materials with me without fear of appropriation thereof,
and to clarify our common understanding concerning our mutual responsibilities,
I am entering into this Agreement. I have read it carefully so that I may
understand its importance.

<PAGE>   4

As a condition to my employment and continued employment, and in consideration
of the premises and the compensation that I accept in connection with such
employment, I agree as follows:

        1. During my employment and thereafter, I shall not, in any way,
directly or indirectly, disclose or appropriate to my own use, or to the use of
any party other than Company, the Proprietary Materials. I shall use my best
efforts to protect the Proprietary Materials from disclosure or misuse, and
inform an executive officer of Company immediately upon learning of any improper
disclosure or misuse of Proprietary Materials by me or by any other employee or
person. I shall not copy or remove from Company's premises any media, papers,
drawings or models relating to or containing any of the Proprietary Materials,
except to the extent necessary in the course of such employment.

        2. During the term of such employment and upon termination of my
employment, I shall promptly and fully disclose to an executive officer of
Company any Proprietary Materials of which I have knowledge.

        3. The Proprietary Materials shall at all times be the exclusive
property of Company, although I am aware that in the absence of this Agreement I
may have been entitled to rights in some of the Proprietary Materials.
Accordingly, I agree that all Proprietary Materials consisting of writings or
works (including but not limited to computer software program codes) shall be
considered works made for hire under the copyright laws, and therefore owned by
Company. So as to assure Company's exclusive rights in the Proprietary
Materials, I hereby assign, transfer and give to Company my entire right, title
and interest in and to the Proprietary Materials, including but not limited to
all rights throughout the world and any renewals and extensions associated
therewith. At the request of Company, during the term of my employment and
forever thereafter, I shall (a) sign, verify, acknowledge, deliver and file any
documents necessary or advisable for Company to obtain ownership of the
Proprietary Materials, including, at Company's expense, the issuance of patents
or copyrights to Company with respect to the Proprietary Materials, and (b)
otherwise assist Company in every reasonable manner in obtaining any of its
rights in the Proprietary Materials (including but not limited to providing
testimony at legal proceedings). I hereby irrevocably appoint Company as my
attorney-in-fact (which appointment shall be deemed a power coupled with an
interest) with full powers of substitution and delegation, to execute, verify,
acknowledge and deliver any such documents.

         4. Upon the termination of my employment for any reason, or if Company
shall request sooner, I shall promptly deliver to an executive officer of
Company all media, papers, drawings, models and other existing material in my
possession or control relating to or containing any of the Proprietary
Materials.

         5. I shall not disclose to Company any knowledge, data or information
which, to my knowledge, another company may consider to be its confidential
information, trade secrets or proprietary information. I am not subject to any
other agreements, whether in writing or verbally, with anyone else that would
prohibit, restrict or interfere with my employment or fulfilling my obligations
under this Agreement.

         6. Were I to leave the Company's employment and utilize my
administrative, merchandise, financial, technological, marketing and sales
skills in competition with the Company, the results would be materially adverse
to Company. Accordingly, during such employment and during the twelve (12) month
period following the termination of my employment with Company (the
"non-competition period"), I shall not engage in or carry on, in any way,
directly or indirectly, either for myself or as a member of a partnership or as
a stockholder or investor (except for ownership of securities, not exceeding 5%
of any class, of a corporation traded on a national securities exchange) or as
an officer, director, employee, agent, representative, advisor or consultant of
any entity (other than Company), any business similar to or competing with any
business carried on by Company or its successors at the time of the termination
of my employment, or directly or indirectly related to the Business and to which
I have been exposed at any time during such employment, in the United States or
any other country in which Company does business or engages in activities at the
time of the termination of such employment. This agreement does not include any
retail operation that does not currently or, in the 5 years prior to execution
of this agreement, conduct business with the Company or one of it's
Subsidiaries.

         7. I shall not, during the non-competition period, in any way, directly
or indirectly (except in the course of such employment), call upon, solicit,
advise or otherwise do or attempt to do, business with any clients,

<PAGE>   5

customers or accounts of Company with whom I had any dealings at any time during
the course of such employment, or take away or interfere or attempt to interfere
with any custom, trade, business or patronage of Company, or interfere with or
attempt to interfere with any officers, employees, representatives, advisors,
consultants or agents of Company, or induce or attempt to induce any of them to
leave the service of Company or violate agreements with it. At the termination
of my employment, Company shall supply to me a written listing of clients,
customers or accounts of Company.

         8. The foregoing shall be deemed to be a series of separate covenants,
one for each county of each state or territory of the United States and one for
each and every country in which Company does business or engages in activity. If
a court shall refuse to enforce all of such separate covenants, then such
unenforceable covenants shall be deemed eliminated for the purpose of such
proceedings to the extent necessary to permit the remaining separate covenants
to be enforced. If a court refuses to enforce any one or more of such separate
covenants because the time thereof is deemed to be excessive or unreasonable,
then such covenants, which would otherwise be unenforceable due to such
excessive or unreasonable period of time, shall be enforced for such lesser
period of time as deemed reasonable and not excessive by such court.

         9. I shall comply with this Agreement even after the termination of my
employment for any reason, and I shall perform each and every obligation set
forth in this Agreement without any further payment or compensation to me,
except for any reasonable out-of-pocket expenses incurred at the request of
Company.

         10. It is understood and agreed that any breach of this Agreement is
likely to result in irreparable injury to Company, and that the remedy at law
alone will be an inadequate remedy for such breach, in that in addition to any
other remedy Company may have, Company shall be entitled to enforce my specific
performance of this Agreement, and to seek both temporary and permanent
injunctive relief (to the extent permitted by law) without the necessity of
proving actual damages.

                                                 /s/ Babette Lienhard
                                                 -------------------------------
                                                 Babette Lienhard

<PAGE>   6

                                  ATTACHMENT C

                          SPECIAL PROVISIONS/SEVERANCE

         1. This letter sets forth the terms of employment, and does not
constitute or promise employment for a specific term. Either you or we can
terminate employment for any reason. Notwithstanding the foregoing, if your
employment is terminated by Company for other than cause, then so long as you
are in compliance with the terms of this letter agreement, including all
attachments. Company shall pay to you a severance consisting of payments on the
first business day of each of the six (6) months immediately succeeding the date
of termination of your employment equal to 1/12th of your Base Salary in effect
on the date of termination. The severance program will also provide benefit
continuation for the entire severance period. For purposes of the prior
sentence, "cause" shall mean: (a) your permanent disability under Company's
long-term disability insurance coverage; (b) failure to devote full time and
best efforts to the performance of your duties; (c) commission of an act of
gross negligence, dishonesty, fraud, gross insubordination, malfeasance,
disloyalty, bad faith or breach of trust in the performance of your duties; (d)
failure to observe the agreements set forth in the agreements attached as
ATTACHMENT A; (e) commit a felony or act which, in the judgment of the Board of
Directors of Company, subjects you or Company to public disrespect, scandal or
ridicule so as to materially and adversely affect the utility of your services
to Company; or (f) refuse to perform duties assigned to you in good faith or
violate or fail to observe any lawful business instruction or lawful business
policy established by Company with respect to the operation of its business and
affairs or fail to, or refuse to, substantially perform your duties; and with
respect to items (b) and (f), after a written notice is delivered by Company,
which specifically identifies the manner in which you have become subject to
termination for cause, if not cured (if such matter is susceptible of cure)
within twenty (20) days after such written notice.

      1.    This Agreement shall be governed by and construed in accordance with
            the laws of the State of Rhode Island, without regard to its
            Conflict of Laws Rules. Employee agrees and consents to personal
            jurisdiction and service in venue in any Federal or State Court
            within Rhode Island having subject matter jurisdiction, for purposes
            of any action, suit or proceeding arising out of or relating to this
            Agreement. Employee waives trial by jury in any such action, suit or
            proceeding.

     By /s/ John R. Ranelli                      /s/ Babette A. Lienhard
       ----------------------------------        -------------------------------
     John R. Ranelli                             Babette A. Lienhard
     President/CEO

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