**NOW, THEREFORE,**in consideration of the mutual covenants and agreements contained herein andfor other good and valuable consideration, the receipt and sufficiency of which is acknowledged,the parties hereto, intending to be legally bound, agree as follows:1. Amendment and Restatement of Section 1. The parties acknowledge and agree thatSection 1 of the Employment Agreement shall be deleted in its entirety and replaced with thefollowing:1. Contract Term —  The term of your employment will extend until June 30,2011, unless terminated earlier by you or by CSS at any time as provided herein. The termof the Executive’s employment with CSS shall renew each year for a three (3) year termunless either the Executive or CSS gives notice of non-renewal at least ninety (90) daysprior to July 1 of each year.2. Amendment and Restatement of Section 4. The parties acknowledge and agree thatSection 4 of the Employment Agreement shall be deleted in its entirety and replaced with thefollowing:4. Employment Status; Severance Pay — Your employment status with CSS will bethat of an employee at-will, and thus this employment status is subject to termination byeither you or CSS at any time. However, in the event that CSS terminates your employmentwithout cause at any time prior to the end of the Executive’s then current employment termset forth in Section 1 hereof, and subject to your compliance with the terms and conditionsof this letter agreement, CSS will pay you an amount equal to the greater of (i) eighteen(18) months of your then-current annual base salary (less applicable tax withholdings andpayroll deductions) or (ii) an amount equal to your then-current annual base salary (lessapplicable tax withholdings and payroll deductions) for the period from the effective dateof such termination to the end of the Executive’s then current employment term set forth inSection 1 hereof, such amount reduced by and to the extent of any earnings and othercompensation received by you or accrued for your benefit for your services (whether as anemployee or as an independent contractor) during the period commencing on the day followingthe one year anniversary of your termination. In addition to the foregoing, in the eventthat CSS terminates your employment without cause at any time prior to the end of theExecutive’s then current employment term set forth in Section 1 hereof, and subject to yourcompliance with the terms and conditions of this letter agreement, CSS will make theservices of an “outplacement” firm available to you to assist you in finding new employment;provided, however, that CSS’ expenditures to make such services available to you shall notexceed the aggregate amount of $6,500. For purposes of this letter agreement, termination“without cause” means termination other than termination resulting from or related to yourbreach of any of your obligations under this letter agreement, your failure to comply withany lawful directive of CSS’ Chairman of the Board of Directors or the Board of Directors ofCSS, your failure to comply with CSS’ Code of Ethics, your conviction of a felony or of anymoral turpitude crime, or your willful or intentional engagement in conduct injurious to CSSor any of its affiliates.The foregoing payment obligation, and the foregoing obligation to make “outplacement”services available to you, is contingent upon (x) receipt by CSS of a valid and fullyeffective release (in form and substance reasonably satisfactory to CSS) of all claims ofany nature which you might have at such time against CSS, its affiliates and theirrespective officers, directors and agents, excepting therefrom only any payments due to youfrom CSS pursuant to this paragraph, and (y) your resignation from all positions of anynature which you may then hold with CSS and its affiliates. If you are eligible to receivethe foregoing payment, such amount will be paid to you in equal installments, with suchinstallments being paid on the then-applicable paydays for CSS executives,commencing on or about the first such payday following the termination of your employment byCSS without cause and your satisfaction of the conditions specified in the immediatelypreceding sentence.
 
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In addition, if you are eligible to receive severance pay under the terms of this letteragreement, and if you elect health care continuation coverage under the Consolidated OmnibusReconciliation Act (“COBRA”) following termination of your employment, CSS will pay for aportion of the monthly COBRA premium, on the same basis as CSS pays for a portion of suchcoverage for active employees, until the earlier of the date upon which (a) severancepayments are no longer paid to you hereunder, (b) you no longer qualify to receive COBRAbenefits, or (c) you elect to discontinue health care continuation coverage under COBRA. Ifyou elect to continue health care continuation coverage under COBRA, normal employee premiumdeductions will be made from your severance pay.Further, if you are eligible to receive the payment set forth in clause (ii) of the firstparagraph of this Section 4, you covenant and agree that commencing with the one yearanniversary of the date of your termination you will promptly advise CSS in writing on abi-weekly basis of any earnings and other compensation received by you or accrued for yourbenefit for your services (whether as an employee or as an independent contractor) duringthe period commencing on the day following the one year anniversary of your termination.3. Addition of a New Section 10. The parties acknowledge and agree that a new Section10 shall be added to the Employment Agreement, which new Section 10 shall read as follows:10. Section 409A of the Code.(a) Interpretation. This letter agreement shall be interpreted to avoid anypenalty sanctions under section 409A of the Internal Revenue Code of 1986, as amended (the“Code”). If any payment or benefit cannot be provided or made at the time specified hereinwithout incurring sanctions under section 409A, then such benefit or payment shall beprovided in full at the earliest time thereafter when such sanctions will not be imposed.All payments to be made upon a termination of employment under this letter agreement mayonly be made upon a ‘separation from service’ under section 409A of the Code. For purposesof section 409A of the Code, each payment made under this letter agreement shall be treatedas a separate payment and the right to a series of installment payments shall be treated asthe right to a series of separate payments. In no event may you, directly or indirectly,designate the calendar year of payment.
 
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(b) Payment Delay. To the maximum extent permitted under section 409A of theCode, the cash severance payments payable under this letter agreement are intended to complywith the ‘short-term deferral exception’ under Treas. Reg. §1.409A-1(b)(4), and anyremaining amount is intended to comply with the ‘separation pay exception’ under Treas. Reg.§1.409A-1(b)(9)(iii); provided, however, any amount payable to the Executive during thesix-month period following your termination date that does not qualify within either of theforegoing exceptions and is deemed as deferred compensationsubject to the requirements of section 409A of the Code, then such amount shall hereinafterbe referred to as the ‘Excess Amount.’ If at the time of your termination of employment,you are a ‘specified employee’ (as defined in section 409A of the Code and determined in thesole discretion of CSS (or any successor thereto) in accordance with CSS’s (or any successorthereto) ‘specified employee’ determination policy), then CSS shall postpone thecommencement of the payment of the portion of the Excess Amount that is payable within thesix-month period following your ‘separation from service’ with CSS (or any successorthereto) for six months following your ‘separation from service’ with CSS (or any successorthereto). The delayed Excess Amount shall be paid in a lump sum to you within thirty (30)days following the date that is six (6) months following the your ‘separation from service’with CSS (or any successor thereto), and any amount payable to you after the expiration ofsuch six (6) month period under this letter agreement shall continue to be paid to you inaccordance with the terms of this letter agreement. If you die during such six-month periodand prior to the payment of the portion of the Excess Amount that is required to be delayedon account of section 409A of the Code, such Excess Amount shall be paid to the personalrepresentative of your estate within sixty (60) days after your death, and any amounts notdelayed shall be paid to the personal representative of your estate in accordance with theterms of this letter agreement.(c) Reimbursements. All reimbursements provided under this letter agreementshall be made or provided in accordance with the requirements of section 409A, including,where applicable, the requirement that (i) any reimbursement is for expenses incurred duringyour lifetime (or during a shorter period of time specified in this letter agreement), (ii)the amount of expenses eligible for reimbursement during a calendar year may not affect theexpenses eligible for reimbursement in any other calendar year, (iii) the reimbursement ofan eligible expense will be made on or before the last day of the calendar year followingthe year in which the expense is incurred, and (iv) the right to reimbursement is notsubject to liquidation or exchange for another benefit.4. Miscellaneous. Except as expressly modified hereby, the Employment Agreementremains in full force and effect. Upon the execution and delivery hereof, the Employment Agreementshall thereupon be deemed to be amended as hereinabove set forth, and this Amendment and theEmployment Agreement shall henceforth be read, taken and construed as one and the same instrument.This Amendment may be executed in counterparts, each of which shall be considered an originalinstrument, but all of which shall be considered one and the same agreement, and shall becomebinding when one or more counterparts have been signed by each of the parties hereto and deliveredto the other party.
 
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IN WITNESS WHEREOF, this Amendment has been executed by CSS and by the Executive as of the datefirst above written.      **CSS INDUSTRIES, INC.**(“CSS”)