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                                 CML GROUP, INC.
                                 524 MAIN STREET
                           ACTON, MASSACHUSETTS 01720


                                                              August 10, 1998

VIA TELECOPIER
--------------
603-569-8082

Mr. G. Robert Tod
P. O. Box 860
Wolfeboro, NH  03894


Dear Bob:

         In connection with your termination of employment, set forth below are
the benefits which CML Group, Inc. agrees to pay you in return for the execution
of a copy of this letter with the release it includes.

         Your termination of employment with CML Group, Inc. (the "Company") is
effective as of June 30, 1998. In connection with your termination, the Company
will provide the following:

         1.       As severance, you will receive $240,000 payable as follows: to
be paid $20,000/mo. - 9 months - August 98 - April 99 and $60,000 - May 1, 99.

         2.       In addition, the Company will immediately take steps to (a)
notify the Trustee of said so-called Rabbi Trust established in connection with
the terms of the Retirement Income and Survivor Security Program (" Retirement
Income Program") that the Retirement Income Program established for your benefit
has been modified and amended to provide for immediate distribution to you of
the policies currently held in said Trust for the purpose of providing all of
your benefits under the Retirement Income Program; provided that if this cannot
be accomplished for any reason then said Retirement Income Program shall be
amended and modified to provide that the Trustee shall be directed by the
Company to surrender any policies insuring your life which are owned by said
Trust and promptly distribute to you the cash value of such policies which are
received by the Trustee on such surrender, and has (b) issued to you 38,310
shares of common stock of the Company to which you are entitled under the
Company's Incentive Deferred Compensation Plan. These distributions will
constitute


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Mr. G. Robert Tod
August 1, 1998
Page 2


full payment and satisfaction of the Company's obligations to you under the
Retirement Income Program and of all other retirement or severance obligations
to you, other than as stated in this letter and other than retirement benefits
provided under the terms of any qualified retirement plan under Section 401 of
the Internal Revenue Code.

         3.       You and the Company agree to take steps promptly to surrender
the three split-dollar insurance policies listed in APPENDIX A hereto in
exchange for their respective cash surrender values (cumulatively "Insurance
Proceeds") and further agree to distribute $_____________ of the Insurance
Proceeds to the Company (being the amount equal to the aggregate cumulative
premiums paid by the Company to the extent not previously withdrawn) and the
balance of the Insurance Proceeds to you. In addition, the Company agrees to
distribute to you the three salary deferral policies listed on APPENDIX B hereto
in such manner as the insurer may require.

         4.       In addition, you will be permitted to continue your use of the
leased automobile which you currently use, subject to your reimbursement of the
Company at the rate of $200 per month, until the distributions under Sections 2
and 3 are completed. After the end of the month in which such distributions are
completed, until December 31, 1998, you will be permitted to continue such
automobile use, subject to reimbursement to the Company of all its expenses in
maintaining said automobile as set forth in a written statement provided by the
Company.

         5.       Effective as of your termination of employment you are
eligible for (i) continuation of your medical benefits under the Company's
health plans to the extent and on the terms required by Section 4980B of the
Internal Revenue Code, as amended, ("COBRA"), (ii) such use of an office at the
Company as President and Chief Executive Officer shall determine from time to
time, and (iii) the benefits of the discount policy for employees in effect for
employees of Nordic Track and Smith & Hawken, from time to time, until July 31,
1999.

         In consideration of the Company's undertakings, you agree as follows:

         1.       You hereby fully, forever, irrevocably and unconditionally
release the Company, its officers, directors, stockholders, corporate
affiliates, attorneys, agents and employees from any and all claims of every
kind and nature which you ever had or now have against the Company, its
officers, directors, stockholders, corporate affiliates, attorneys, agents and
employees, including, but not limited to, all claims arising out of your
employment, all employment discrimination claims under Title VII of the Civil
Rights Act of 1964, 42 U.S.C. Section 2999e Et Seq., the Americans With
Disabilities Act,


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Mr. G. Robert Tod
August 1, 1998
Page 3


42 U.S.C. Section 12191 Et Seq., the Age Discrimination in Employment Act, 29
U.S.C. Section 621 Et Seq., and Massachusetts Fair Employment Practices Act,
M.G. L. c.151B, Section 1 Et Seq., wrongful discharge claims or other common law
claims.

         2.       You agree that, during the two year period beginning on the
date of your execution of a copy of this letter, you will not, without the prior
specific consent of the Company, in any capacity, either separately, jointly, or
in association with others, directly or indirectly, encourage, solicit,
initiate, engage or participate in discussions or negotiations with any person
or entity concerning any merger, consolidation, purchase of material assets,
tender offer, accumulation of shares of the Company's capital stock, proxy
solicitation or other business combination involving the Company, any subsidiary
of the Company or any division of the Company or any such subsidiary; PROVIDED,
HOWEVER, that nothing herein shall prevent you from bringing to the attention of
the Company any unsolicited offer or proposal relating to the foregoing.

         3.       You agree that, as a condition for these payments to you, you
will not make any false, disparaging or derogatory statements in public or
private regarding the Company or any of its directors, officers, employees,
agents, or representatives or the Company's business affairs and financial
condition; and the Company agrees that it will not make any false, disparaging
or derogatory statements in public or private regarding you.

         4.       You will not, directly or indirectly, during the two year
period beginning on the date of your execution of this letter, recruit, solicit
or hire any key employee of the Company, or induce or attempt to induce any key
employee of the Company to terminate his or her employment with, or otherwise
cease his or her relationship with, the Company.

         5.       You expressly agree that breach of your agreement to the
provisions in Paragraphs 2, 3 and 4 would result in irreparable injuries to the
Company, that the remedy at law for any such breach would be inadequate and that
upon breach of either of these provisions, the Company, in addition to all other
available remedies, shall be entitled as a matter of right to injunctive relief
in any court of competent jurisdiction without the necessity of proving the
actual damage to the Company.

         This agreement will be governed by the laws of the Commonwealth of
Massachusetts and is binding upon and shall inure to the benefit of the parties
and their respective agents, assigns, heirs, executors, successors and
administrators.


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Mr. G. Robert Tod
August 1, 1998
Page 4


         This letter contains and constitutes the entire understanding and
agreement between you and the Company with respect to severance and supersedes
and cancels all previous oral and written negotiations, agreements, commitments
and writings in connection with your severance. To the extent permitted by law,
you agree that the contents of our discussions and negotiations resulting in
this letter and agreement, shall be maintained as confidential by you, your
agents and representatives, and any dispute resolved by this document shall also
remain confidential, and none of the above shall be disclosed except to the
extent required by federal or state law or as otherwise agreed to in writing by
the authorized agent of each party.

         You hereby acknowledge you have been given twenty-one (21) days to
consider this agreement and that the Company advised you to consult with any
attorney of your choosing prior to signing this agreement. You may revoke this
agreement for a period of seven (7) days after its execution, and the agreement
will not be effective or enforceable until the expiration of this seven (7) day
revocation period.



                                        Very truly yours,
                                        CML Group, Inc.

                                        By /s/ John A.C. Pound
                                           ------------------------------------ 
                                           John A.C. Pound, President and
                                           Chief Executive Officer



I agree to all the terms of this letter.


/s/ G. Robert Tod
-------------------------
G. Robert Tod
Dated: August 18, 1998