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Item 5.02
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers;
Compensatory Arrangements of Certain Officers
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On February 15, 2021,
Edmund J. Schwartz, Chief Financial Officer of Summer Infant, Inc (the “Company”), notified the Company’s Board
of Directors (the “Board”) that he intends to retire from the Company effective March 31, 2021. Mr. Schwartz will remain
in the position of Chief Financial Officer until March 19, 2021, when he will be succeeded by Bruce Meier as Interim Chief Financial
Officer, and will continue to consult with the Company in support of the transition until March 31, 2021. On February 16, 2021,
the Board approved the appointment of Mr. Meier as Interim CFO, effective March 19, 2021.
Mr. Meier, 53, is a
financial professional with more than 20 years of diversified experience in the areas of financial management and performance improvement,
organizational restructuring, cash management discipline, strategic planning and development and evaluation of business plans.
Since 2014, Mr. Meier has been a managing director at Winter Harbor, LLC, a consulting firm specializing in turnaround and restructuring
services, where he has provided interim management and advisory services to a variety of clients.
Since December 2019,
Mr. Meier has worked as a business and financial advisor to the Company under its engagement of Winter Harbor. The Company engaged
Winter Harbor in December 2019 pursuant to the terms of an engagement agreement between the Company and Winter Harbor (as amended,
the “Letter Agreement”) to provide management and advisory services to the Company, including, subject to the Board’s
prior approval, for Mr. Meier to serve in an executive role for the Company. Mr. Meier will not receive any compensation directly
from the Company for acting as Interim CFO. Compensation for the services provided under the Letter Agreement were initially determined
based on agreed-upon hourly rates, subject to a cap of $35,000 per week, and thereafter upon actual hours worked or such other
mutually agreed upon fee structure, plus any out-of-pocket expenses. In February 2020, the Company and Winter Harbor entered into
an amendment to the Letter Agreement that provides for compensation at a weekly rate of $40,000, which became effective on February
24, 2020. Under the Letter Agreement, the Company has also agreed to indemnify Winter Harbor, Mr. Noyes and other Winter Harbor
personnel in connection with the engagement, subject to customary terms and conditions. Either party may terminate the Letter Agreement
upon six months’ prior written notice. For the fiscal year ended January 2, 2021, the Company paid approximately $2,124,324
related to services provided under the Letter Agreement, including expenses and administrative fees. For the fiscal year ended
December 28, 2019, the Company paid or accrued $76,194 related to services provided under the Letter Agreement, including expenses
and administrative fees.
In addition,
prior to entering into the Letter Agreement, in November 2019 in connection with the Company’s amendment to its credit
facilities, the Company engaged Winter Harbor to provide financial advisory services (the “Advisor Agreement”)
and paid a retainer of $25,000. Compensation under the Advisor Agreement is determined based on agreed-upon hourly rates for
actual hours worked, plus any out-of-pocket expenses and a 1% administrative fee on the total amount of each invoice to cover
administrative costs. For the fiscal year ended January 2, 2021, the Company had paid approximately $74,494 related to
services provided under the Advisory Agreement, including expenses and administrative fees. For the fiscal year ended
December 28, 2019, the Company paid or accrued $35,774 related to services provided under the Letter Agreement, including
expenses and administrative fees. Fees for services under the Advisor Agreement engagement are separate from, and in addition
to, fees paid under the Letter Agreement.