**Exhibit 10.44**

February 28, 2006

Chris Newman

Dear Chris:

I am pleased tooffer you the position of Chief Financial Officer and Secretary at RestorationHardware, Inc. (the “Company”). I’m confident that you will find ourCompany to be an exciting and challenging environment in which to work. Thisletter will confirm the most important details of our offer to you.

| *Title*                        | Chief Financial Officer and Secretary reporting to  the Chief Executive Officer.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *Salary*                       | $375,000 per year, paid  bi-weekly.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| *Bonus*                        | You will receive a  signing bonus of $100,000, which will be payable on the first payroll  following your date of hire. If you voluntarily resign or are terminated for  “Cause” (as defined in *Attachment A*)  on or prior to the one year anniversary of your first date of employment, you  agree that you will reimburse the Company for a pro-rated share of the  signing bonus, which shall be calculated by dividing the number of days you  were employed by the Company by 365. You also will be guaranteed a minimum  bonus of $50,000 for Fiscal 2006, provided your employment does not terminate  due to your voluntarily resignation or a termination for Cause before the end  of Fiscal Year 2006. In addition, you will be guaranteed a minimum bonus of  $50,000 for Fiscal 2007, provided your employment does not terminate due to  your voluntarily resignation or a termination for Cause before the end of  Fiscal Year 2007. Each bonus will be payable when the Company distributes its  annual incentive bonuses to other senior officers for such fiscal year. |
| *Management Incentive Program* | You will be eligible to  participate in the Management Incentive Program. Your eligibility range will  be up to 75% of your base pay. Your guaranteed bonus amounts (other than your  signing bonus) for Fiscal 2006 and Fiscal 2007 referred to above will be  credited against your actual bonuses for such years. You will receive full  plan details upon your arrival at the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| *Stock Option Grant*           | Subject to the approval  of the Compensation Committee of the Board of Directors of the Company, you  will receive 200,000 stock options at the fair market value of our common  stock on the grant date thereof, which will be your first day of employment  with the Company. Stock options will vest at 25% per year, over a four-year  period, and have a ten-year term, with other terms being in accordance with  the Company’s 1998 Stock Incentive Plan, as amended and restated  October 9, 2002. Your initial option grant will be an incentive stock  option to the maximum extent permitted under Section 422 of the Internal  Revenue Code                                                                                                                                                                                                                                                                                                                                                                                                                               |
| * *                       | In the event your  employment with the Company is terminated for any reason other than death,  disability or for Cause, you will have three months following your  termination of employment to exercise the vested portion of your initial  option grant. In the event your employment with the Company is terminated for  Cause, your initial option grant will terminate concurrently with your  termination of employment. In the event your employment with the Company is  terminated due to your death or disability, you will have twelve months  following your termination of employment to exercise the vested portion of  your initial option grant. In no event may your initial option grant be  exercised after the expiration of its ten-year term.                                                                                                                                                                                                                                                                                                                                  |

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| * *                 | In addition, you will be  eligible to receive options or other equity of the Company on an annual basis  in accordance with the Company’s 1998 Stock Incentive Plan, as amended and  restated October 9, 2002. The type and amount of equity of the Company  that you will be eligible to receive in any year in accordance with the  Company’s 1998 Stock Incentive Plan generally will be consistent with the  type and amount of equity that other similarly-situated senior officers  of the Company will be eligible to receive in such year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|--------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *Severance*              | Should your  employment be terminated “Not for Cause” (as defined in *Attachment A*)  by the Company, other than in connection with a “Change of Control” (as  defined in *Attachment B*), you will  receive salary continuation for a period of one (1) year from your  termination date and a pro-rated bonus based on your then current year’s  incentive target bonus amount (the “Bonus Amount”). In the event that you  resign or are terminated by the Company for Cause, you will not be eligible  to receive any severance pay. Your entitlement to any severance payments will  be contingent upon your execution of the Company’s written release and  expiration of any applicable revocation period to the Company’s written  release. (See *Attachment A*)                                                                                                                                                                                                  |
| *Change  of Control*     | Should there be a  Change of Control of the Company (See *Attachment B*)  and you, within 12 months thereafter, are subject to an “Involuntary  Termination” (as defined in *Attachment B*)  by the Company, you will receive, in lieu of any other severance pursuant to  this offer letter, salary continuation for a period of one (1) year from  your termination date at the annual rate of your base salary and a pro-rated  bonus based on the Bonus Amount. In addition, your initial stock option grant  will vest in full. Your entitlement to any severance payments and  acceleration of your stock option grant will be contingent upon your  execution of the Company’s written release and expiration of any applicable  revocation period to the written release. (See *Attachment  A*) In addition, the severance payments and benefits to be provided  upon an Involuntary Termination following a Change of Control are subject to  the excise tax payment provisions set forth in *Attachment  B.* |
| *Non-Compete  Provision* | You acknowledge  and agree that in your role as Chief Financial Officer you shall acquire  confidential and proprietary information belonging to the Company. To  preserve and protect this information and the assets of the Company, and in  consideration of the severance and benefits provided to you under this offer  letter, you agree not to work in a capacity that would compete directly with  the Company, or solicit any employees or customers of the Company, for a  period of one (1) year following the  effective date of your resignation from or termination by the Company  for any reason, as set forth in *Attachment C*.  In the event that you breach this provision all severance and other benefits  shall cease*.*                                                                                                                                                                                                                                                                                       |
| *Car  Allowance*         | You will receive  a car allowance of $500.00 per month.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| *401(k) Plan*       | You will be  eligible to participate in the Company’s 401(k) Plan on the first  enrollment dates following your date of hire.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| *Medical  Benefits*      | You will be  eligible to participate in the Company’s healthcare program per the Company’s  guidelines.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| *Vacation*               | 15 days (3 weeks)  per year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |

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| *Employee  Discount*       | You will be  eligible for a 40% associate discount on merchandise of the Company.                                                                                                                                       |
|----------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *Miscellaneous  Benefits:* | You will be  eligible for other benefits as set forth in the relocation policy (and other  policies, if any) attached hereto as administered in accordance with the  Company’s customary practices and procedures. |

 

The language that follows reflects our standard offerletter language. We do not mean for it to come across as impersonal, butrather, as sound and necessary information for you to know from the outset ofyour working relationship with us. The relationship between you and the Companyis called “at-will employment.” This means that employment with the Company isfor no specific period of time. As a result, either you or the Company is freeto terminate your employment relationship at any time for any reason, with orwithout Cause. This is the full and complete agreement between us on this term.Although your job duties, title, compensation, benefits, or the Company’spolicies, practices and procedures may change from time to time, the “at-will”nature of your employment may only be changed in an express writing signed byyou and the Chief Executive Officer of the Company.

Finally, your employment is contingent on (a) youexecuting a Proprietary Information and Inventions Agreement, (b) youproviding the Company with legal proof of your identity and authorization towork in the United States at time of hire and (c) successful completion ofa routine background investigation and references check.

*I am enclosing twocopies of this letter. Please sign and return one copy to me on your first dayof work and keep the other copy for your files.*

Chris,we are very excited about you joining the “Resto” team and look forward to yourcontributions to the growth and success of the Company.

| Sincerely,                                                     |
|----------------------------------------------------------------|
| /s/ Gary Friedman                                              |
| Gary Friedman  Chairman, President and Chief Executive Officer |

 

**Þ***I understand and agree to the terms of this offer of employment:*

| /s/ Chris Newman |   | March 6, 2006 |
|------------------|--------|--------------------|
| Chris Newman     |   | Date               |

 

cc:           Associate’s File

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***Attachment A***

***Severance.****  *In the event that your employment is terminated Notfor Cause by the Company, other than in connection with a “Change of Control”(as defined in *Attachment B*), you will beeligible to receive severance pay in the form of salary continuation for aperiod of twelve (12) months from your termination date with the Company at anannual rate equal to your base salary and a pro-rated bonus based on your thencurrent year’s incentive target bonus, less in each case applicable deductionsand withholdings, payable in regular periodic payments in accordance with theCompany’s policy. (See Item D1 of *Attachment D*)  You acknowledge that except as expresslyprovided in this offer letter, you will not receive any additionalcompensation, severance or benefits after your termination of employment. Youagree and acknowledge that your right to receive the severance payments shallbe conditioned upon your execution of a release agreement with the Companycontaining standard terms and conditions used by the Company at the time for ageneral release by a senior officer of all claims arising from the officer’srelationship with the Company. In the event that the Company terminates youremployment for “Cause” (as defined below), you shall not be entitled to receiveany of the severance payments or benefits described above, and the Companyshall pay you all compensation due and owing through the last day actuallyworked; thereafter the obligations of the Company under this offer letter shallcease.

If you are subject to an Involuntary Terminationwithin 12 months following a Change of Control, you will be eligible to receiveseverance pay in the form of salary continuation for a period of twelve (12)months from your termination date with the Company at an annual rate equal toyour base salary and a pro-rated bonus based on your then current year’sincentive target bonus, less in each case applicable deductions andwithholdings, payable in regular periodic payments in accordance with theCompany’s policy. (See Item D1 of *Attachment D*)  You also will receive full vesting of yourinitial stock option grant of 200,000 stock options only. You agree andacknowledge that your right to receive the severance payments and accelerationof your initial stock option grant shall be conditioned upon your execution ofa release agreement with the Company containing standard terms and conditionsused by the Company at the time for a general release by a senior officer ofall claims arising from the officer’s relationship with the Company. Inaddition, the severance payments and benefits to be provided upon anInvoluntary Termination following a Change of Control are subject to the excisetax payment provisions set forth in *Attachment B*.

***Definition of Causeand Not for Cause.***   For purposes ofdetermining your eligibility for the above-described severance payments andbenefits, the Company may terminate your employment for “Cause” if: (a) youexhibit persistent deficiencies in performance or gross incompetence, (b) youbreach any material term of this offer letter or any other written agreementyou have with the Company, (c) you have been convicted of a felonyinvolving fraud or dishonesty, (d) you die or suffer from a “Disability”(as defined below) during your continued employment with the Company, (e) youintentionally and continually fail to substantially perform your reasonablyassigned duties with the Company (other than a failure resulting from yourassignment of duties that would constitute an “Involuntary Termination” (asdefined in *Attachment B*) following a Change ofControl), which failure continues for a period of at least thirty (30) daysafter a written notice of demand for substantial performance has been deliveredto you specifying the manner in which you have failed substantially to perform,or (f) intentionally engaged in conduct which is demonstrably andmaterially injurious to the Company; provided, that no termination of youremployment shall be for Cause as set forth in clause (f) above until thereshall have been delivered to you a copy of a written notice setting forth thatyou were guilty of the conduct set forth in clause (f) and specifying theparticulars thereof in detail. No act, nor failure to act, on your part shallbe considered “intentional” unless you have acted, or failed to act, with alack of good faith and with a lack of reasonable belief that your action orfailure to act was in the best interest of the Company.

For purposes of this offer letter, the term “Not forCause” shall mean termination of your employment by the Company for reasonsother than for “Cause.”

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***Termination byEmployee.*****  **In theevent that you elect to terminate your employment for any reason other than inconnection with an Involuntary Termination within 12 months following a Changeof Control, the Company shall pay you all compensation due and owing throughthe last day actually worked and thereafter the obligations of the Companyunder this offer letter shall cease.

***Disability.*****  **“Disability” shall mean that you are unable to carry outthe responsibilities and functions of the position held by you by reason of anyphysical or mental impairment for more than 120 days in any twelve-month period.If you suffer from a Disability, then, to the extent permitted by law, theCompany may terminate your employment. The Company shall pay to you allcompensation to which you are entitled up through the date of termination, andthereafter all obligations of the Company under this offer letter shall cease. Nothingin this offer letter shall affect your rights under any disability plan inwhich you are a participant.

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***Attachment B***

***Definitions:***

“InvoluntaryTermination” shall mean the termination of your employment which occurs byreason of:

(i)    yourinvoluntary dismissal or discharge by the Company Not for Cause, or

(ii)   yourvoluntary resignation within 45 days following one or more of the followingevents:

(A)  a change inyour position with the Company which materially reduces your duties andresponsibilities or the level of management to which you report,

(B)   a reductionin your level of compensation (including base salary, fringe benefits andtarget bonus under any corporate-performance based bonus or incentiveprograms), other than a reduction  thatis similar in percentage or nature to a reduction generally applicable to all similarly-situatedsenior officers of the Company, or

(C)   arelocation of your principal place of employment by more than fifty (50) miles,provided and only if such change, reduction or relocation is effected by theCompany without your consent.

“Change of Control”shall mean any of the following:

(a)    Anacquisition (other than directly from the Company) of any voting securities ofthe Company (the “Voting Securities”) by any Person (as the term “person” isused for purposes of Section 13 or 14 of the Securities Exchange Act of1934, as amended (the “1934 Act”)) immediately after which such Person hasBeneficial Ownership (as the term “beneficial ownership” is defined under Rule 13d-3promulgated under the 1934 Act) of fifty percent (50%) or more of the combinedvoting power of the Company’s then outstanding Voting Securities; provided,that in determining whether a Change of Control has occurred, Voting Securitieswhich are acquired in a Non-Control Acquisition (as hereinafter defined) shallnot constitute an acquisition which would cause a Change of Control. A “Non-ControlAcquisition” shall mean an acquisition by (i) an employee benefit plan (ora trust forming a part thereof) maintained by (1) the Company or (2) anycorporation or other Person of which a majority of its voting power or itsequity securities or equity interest is owned directly or indirectly by theCompany (a “Subsidiary”), (ii) the Company or any Subsidiary, or (iii) anyPerson in connection with a Non-Control Transaction (as hereinafter defined);

(b)   Theindividuals who, as of date this offer letter, are members of the Board ofDirectors of the Company (the “Incumbent Board”), cease for any reason toconstitute at least a majority of the Board of Directors of the Company;provided, that if the appointment, election or nomination for election by theCompany’s stockholders of any new director was approved by a vote of at leasttwo-thirds of the Incumbent Board, such new director shall, for purposes ofthis offer letter, be considered a member of the Incumbent Board; and provided,further, that no individual shall be considered a member of the Incumbent Boardif such individual initially assumed office as a result of either an actual orthreatened “Election Contest” (as described in Rule 14a-11promulgated under the 1934 Act) or other actual or threatened solicitation ofproxies or consents by or on behalf of a Person other than the Board ofDirectors of the Company (a “Proxy Contest”) including by reason of anyagreement intended to avoid or settle any Election Contest or Proxy Contest;

(c)    A merger,consolidation or reorganization involving the Company, unless such merger,consolidation or reorganization satisfies the conditions set forth in clauses (1) and(2) below (any transaction(s) meeting the requirements of clauses (1) and(2) below being referred to herein as “Non-Control Transactions”):

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(1)   thestockholders of the Company immediately before such merger, consolidation orreorganization own, directly or indirectly, immediately following such merger,consolidation or reorganization, at least fifty percent (50%) of the combinedvoting power of the outstanding voting securities of the corporation resultingfrom such merger, consolidation or reorganization (the “Surviving Corporation”)in substantially the same proportion as their ownership of the VotingSecurities immediately before such merger, consolidation or reorganization; and

(2)   theindividuals who were members of the Incumbent Board immediately prior to theexecution of the agreement providing for such merger, consolidation orreorganization constitute at least a majority of the members of the board ofdirectors of the Surviving Corporation;

(d)   A completeliquidation or dissolution of the Company; or

(e)    Anagreement for the sale or other disposition of all or substantially all of theassets of the Company to any Person (other than a transfer to a Subsidiary);and

(f)    Any otherevent that at least two-thirds of the Incumbent Board in its sole discretionshall determine constitutes a Change of Control.

Notwithstanding the foregoing, a Change of Controlshall not be deemed to occur solely because any Person (the “Subject Person”)acquired Beneficial Ownership of more than the permitted amount of theoutstanding Voting Securities as a result of the acquisition of VotingSecurities by the Company which, by reducing the number of Voting Securitiesoutstanding, increases the proportional number of shares Beneficially Owned bythe Subject Person; provided, that if a Change of Control would occur (but forthe operation of this sentence) as a result of the acquisition of VotingSecurities by the Company, and after such share acquisition by the Company theSubject Person becomes the Beneficial Owner of any additional voting Securitieswhich increases the percentage of the then outstanding Voting SecuritiesBeneficially Owned by the Subject Person, then a Change of Control shall occur;provided further that no Change of Control shall be deemed to have occurredunder (a) or (c) above merely because individuals and entities who,individually, as of the date of the offer letter have Beneficial Ownership ofat least 5% of the Voting Securities have, immediately after the transactiondescribed in (a) or (c) above, Beneficial Ownership, in theaggregate, of more than 50% of the Voting Securities of the Company orsuccessor or parent thereof if both (i) no one such individual or entityhas, immediately after such a transaction, Beneficial Ownership of more than50% and (ii) the transaction does not result in the Company or successoror parent thereof becoming a private company.

Notwithstanding anythingcontained in this offer letter to the contrary, if your employment isterminated prior to a Change of Control and the Board of Directors of theCompany determines that such termination (i) was at the request of a thirdparty who has indicated an intention or taken steps reasonably calculated toeffect a Change of Control and who subsequently effectuates a Change of Controlor (ii) otherwise occurred in connection with, or in anticipation of, aChange of Control which actually occurs, then, for all purposes of this offerletter, the date of a Change of Control with respect to you shall mean the dateimmediately prior to the date of such termination of your employment.

***ExciseTax Payments:***

(1)   In theevent that any payment or benefit (within the meaning of Section 280G(b)(2) ofthe Internal Revenue Code of 1986, as amended (the “Code”)) to you or for yourbenefit, paid or payable or distributed or distributable pursuant to the termsof this letter or otherwise in connection with, or arising out of, youremployment with the Company or a Change in Control (a “Payment” or “Payments”),would be subject to the excise tax imposed under Code Section 4999, or anyinterest or penalties are incurred by you with respect to such excise tax (suchexcise tax, together with any such interest and penalties, are hereinaftercollectively referred to as the “Excise Tax”), the Payments shall be reduced(but not below 

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zero) if and to the extentnecessary so that no Payment to be made or benefit to be provided to you shallbe subject to the Excise Tax (such reduced amount is hereinafter referred to asthe “Limited Payment Amount”). Unless you have given prior written noticespecifying a different order to the Company to effectuate the Limited PaymentAmount, the Company shall reduce or eliminate the Payments by (i) firstreducing or eliminating those payments or benefits which are payable in cashand (ii) then reducing or eliminating non-cash payments, in each case inreverse order beginning with payments or benefits which are to be paid thefurthest in time from the Determination (as hereinafter defined). Any noticegiven by you pursuant to the preceding sentence shall take precedence over theprovisions of any other plan, arrangement or agreement governing your rightsand entitlements to any benefits or compensation.

(2)   An initialdetermination as to whether the Payments shall be reduced to the LimitedPayment Amount and the amount of such Limited Payment Amount shall be made, atthe Company’s expense, by the accounting firm that is the Company’s independentaccounting firm as of the date of the Change in Control (the “Accounting Firm”).The Accounting Firm shall provide its determination (the “Determination”),together with detailed supporting calculations and documentation, to theCompany and you within five (5) days after the termination date, ifapplicable, or such other time as requested by the Company or by you (providedyou reasonably believe that any of the Payments may be subject to the ExciseTax) and, if the Accounting Firm determines that no Excise Tax is payable byyou with respect to a Payment or Payments, it shall furnish you with an opinionreasonably acceptable to you that no Excise Tax will be imposed with respect toany such Payment or Payments. Within ten (10) days after the delivery ofthe Determination to you, you shall have the right to dispute the Determination(the “Dispute”). If there is no Dispute, the Determination shall be binding,final and conclusive upon the Company and you, subject to the application ofparagraph (3) below.

(3)   As a resultof the uncertainty in the application of Sections 4999 and 280G of theCode, it is possible that the Payments to be made to, or provided for thebenefit of, you will be either greater (an “Excess Payment”) or less (an “Underpayment”)than the amounts provided for by the limitations contained in paragraph (1) above.

(a)    If it isestablished, pursuant to a final determination of a court or an InternalRevenue Service (the “IRS”) proceeding which has been finally and conclusivelyresolved, that an Excess Payment has been made, Executive must repay suchExcess Payment to the Company; *provided*, thatno Excess Payment will be repaid by Executive to the Company unless, and only tothe extent that, the repayment would either reduce the amount on whichExecutive is subject to tax under Code Section 4999 or generate a refundof tax imposed under Code Section 4999.

(b)   In theevent that it is determined (i) by the Accounting Firm, the Company (whichshall include the position taken by the Company, or together with itsconsolidated group, on its federal income tax return) or the IRS, (ii) pursuantto a determination by a court, or (iii) upon the resolution to yoursatisfaction of the Dispute, that an Underpayment has occurred, the Companyshall pay an amount equal to the Underpayment to you within ten (10) daysafter such determination or resolution, together with interest on such amountat the applicable federal rate under Code Section 7872(f)(2) from thedate such amount would have been paid to you until the date of payment.

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***AttachmentC***

***ConfidentialInformation.****  *Youagree to hold in confidence for the benefit of the Company all secret orconfidential information, knowledge or data, including proprietary informationand trade secrets, relating to the Company and its businesses, which shall havebeen obtained by you prior to or in the course of your employment by theCompany (“Confidential Information”), provided, however, that ConfidentialInformation shall not retain its status as such if the Confidential Information(i) is publicly known through no act or omission by you, (ii) becomesavailable to you on a non-confidential basis from a source other than theCompany, provided that such source is not bound by a confidentiality agreementwith, or other obligation of secrecy to, the Company or another party, or (iii) isknow by you prior to receiving it from the Company, provided that suchinformation is not subject to another confidentiality agreement with, or otherobligation of secrecy to, the Company or another party. You also shall have theright to disclose Confidential Information to the extent required by law,provided that you first give prompt written notice to the Company regarding theintention to make such disclosure and, provided, further, you requestconfidential treatment of such Confidential Information to the fullest extentpermitted by law. Whether before or after termination of your employment withthe Company, you shall not, without the prior written consent of the Company,communicate or divulge any Confidential Information, other than to the Companyand to those persons or entities designated by the Company or as otherwise isreasonably necessary for you to carry out you responsibilities as an executiveof the Company.

You also represent and warrant and covenant that youshall not disclose to the Company, or use, or induce the Company to use, anyconfidential or proprietary information or trade secrets of others at any time,and you acknowledge and agree that any violation of this provision shall begrounds for your immediate termination for Cause and could subject you tosubstantial civil liabilities and criminal penalties. You further specificallyand expressly acknowledge that no officer or other employee or representativeof the Company has requested or instructed you to disclose or use any suchthird party confidential or proprietary information or trade secrets.

***Restriction onCompetition.****  *Youacknowledge and agree that in your role as Chief Financial Officer you shallacquire confidential and proprietary information belonging to the Company. Topreserve and protect this information and the assets of the Company, includingthe goodwill and customers of the Company of which you will have an interest inyour role as an employee and officer of the Company, or its subsidiaries, andto preserve and protect the goodwill and business interests of the Companygoing forward, and in consideration of the severance and benefits provided toyou under the offer letter, you agree that, for a period of one (1) yearfrom your**** termination of employment for any reason (the “RestrictedPeriod”), you will not directly or indirectly engage in, or have any ownershipinterest in, or participate in the financing operation, management or controlof, any person, firm, corporation or business that engages in the RestrictedBusiness of Restoration Hardware, Inc. “Restricted Business of RestorationHardware, Inc.” is defined in Item D2 of *AttachmentD.*

***Restrictions onSolicitation after Termination.***   Inconsideration of the severance and benefits provided to you under the offerletter, you agree that, during the Restricted Period, you shall not, withoutthe prior written consent of the Company, directly or indirectly, including,without limitation, as a sole proprietor, member of a partnership, stockholderor investor, officer or director of a corporation, or as an employee,associate, consultant, independent contractor or agent of any person,partnership, corporation or other business organization or entity other thanthe Company (i) solicit or endeavor to entice away from the Company anyperson or entity who is, or during the then most recent 12-month periodwas, employed by, or had served as an agent or key consultant of the Company; (ii) solicitor endeavor to entice away from the Company any person or entity who is, or waswithin the then most recent 12-month period, a customer of the Company; (iii) attemptto solicit any business that is related to the business of the Company or anybusiness that is competitive with the Company; or (iv) assist any person,firm, corporation or business that engages in the Restricted Business ofRestoration Hardware, Inc. in taking such action set forth in clauses 

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(i), (ii) or (iii). Furthermore,during the Restricted Period, you shall not, for yourself or for any otherentity, hire or employ any person who is, or during the then most recent 12-monthperiod was, employed by, or had served as an agent or key consultant of, theCompany.

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***Attachment D***

***D1. MedicalBenefits As Part Of Severance.****  *You shall be entitled to continue medical benefitcoverage for yourself and your eligible dependents under COBRA until the laterof the date that you become entitled to medical benefits from another employeror the end of the period of base salary continuation, subject to your paymentof applicable premiums, if any, at the same rate that would have applied hadyou remained an officer of the Company.

***D2. Definition of “RestrictedBusiness of Restoration Hardware, Inc.”***   “RestrictedBusiness of Restoration Hardware, Inc.” shall mean (a) a retailcompany, including without limitation, a subsidiary or business unit of suchcompany, where an aggregate of 25% or more of its revenue (including revenue ofany subsidiary or business unit) is derived from the home furnishings business,including without limitation, lighting, floor covering, furniture, hardware andtools, or hard goods business or (b) a manufacturer, supplier or othervendor that has a material vendor relationship with the Company.

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**RESTORATION HARDWARE**

***RelocationPolicy***

| **BENEFITS**                        | ** ** | ** **                                                                                                                                                        | ** ** | **DETAILS** |
|-------------------------------------|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|-------------|
| Miscellaneous  Relocation Allowance |       | $5,000 grossed up  for tax purposes                                                                                                                               |
| House Hunting  Trips                |       | One trip not to  exceed 6 nights / 7 days, to include lodging, meals and transportation for  employee, spouse and children.                                       |
| Shipment of  Household Goods        |       | Packing, loading,  shipping and unloading normal household goods with company assigned  authorized carriers.                                                      |
| Storage of  Household Goods         |       | Up to ninety (90)  days.                                                                                                                                          |
| Shipment of  Automobile             |       | Ship two personal  automobile if distance is more than 750 miles.                                                                                                 |
| Temporary Living                    |       | Up to ninety (90)  days lodging and meals (excluding lunches during work week), with one trip  every other weekend to and from employee’s home address only. |
| Selling Costs of  Former Home       |       | Normal and  customary selling costs.                                                                                                                              |
| New Home Closing  Costs             |       | If homeowner,  reimbursable expenses will include:                                                                                                                |
|                                |       | ·  Loan application/ commitment fees                                                                                                                    |
|                                |       | ·  Legal fees                                                                                                                                           |
|                                |       | ·  Origination fee (max 1%)                                                                                                                             |
|                                |       | ·  Recording fees                                                                                                                                       |
|                                |       | ·  Credit/appraisal reports                                                                                                                             |
|                                |       | ·  Tax search                                                                                                                                           |
|                                |       | ·  Title Ins. (lender coverage only)                                                                                                                    |
|                                |       | ·  Survey                                                                                                                                               |
|                                |       | ·  Closing/escrow/settlement fees                                                                                                                       |
|                                |       | ·  Transfer taxes/stamps                                                                                                                                |
|                                |       | ·  Home Inspection                                                                                                                                      |
| Final Trip to New  Location         |       | For employee and  family—reimbursement of reasonable lodging, meals and transportation.                                                                      |
| Duplicate  Mortgage                 |       | Up to six  (6) months.                                                                                                                                       |
|                                |       |                                                                                                                                                              |

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| Tax Information |   | Gross-up includes deductible and non-deductible  expenses.                            |
|-----------------|--------|---------------------------------------------------------------------------------------|
|            |   | *Non-deductible (taxed and  grossed-up)*                                              |
|            |   | ·  Final move, meals & mileage                                     |
|            |   | ·  Pre-move travel                                                          |
|            |   | ·  Temporary living                                                         |
|            |   | ·  Expenses of buying new residence (excluding  origination fees or points) |
|            |   | *Deductible*                                                                          |
|            |   | ·  Loan origination or points                                               |

 

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