As of February 28, 2006


Mr. Bruce E. Zurlnick
22 Verona Court
New City, NY 10956

Dear Mr. Zurlnick:

     We write to set forth our agreement with respect to your continued
employment by Finlay Fine Jewelry Corporation (the "Company").

     1. The Company hereby agrees to continue to employ you, and you agree to
continue to be employed by the Company, on the terms and conditions hereinafter
set forth. You will serve as Senior Vice President, Chief Financial Officer and
Treasurer of the Company and you will hold such other offices in the Company and
its parent company, subsidiaries and divisions to which you may from time to
time be appointed or elected. You agree to serve the Company faithfully and to
the best of your ability, to promote the Company's best interests and to devote
your full working time, energy and skills to the Company's business.

     2. (a) As full compensation for your services hereunder (including
services, if any, as an officer of the Company and an officer and director of
its subsidiaries and divisions), you shall receive base salary ("Base Salary")
at the rate of $310,000 per annum, payable in equal monthly installments and an
annual bonus payable on April 25th during each year of the term hereof based on
the attainment of financial goals as set by the Company's Compensation Committee
("Annual Bonus"), less all applicable withholding taxes and lawful deductions.
The Company shall include you in any employee benefit plans and other fringe
benefit programs that it maintains for senior executives. The Company shall
reimburse you for your ordinary and necessary business expenses incurred in the
course of your performance of services hereunder, subject to submission of
adequate substantiation thereof and to conformance with the Company's regular
policies from time to time in effect with respect to reimbursement of expenses.



Mr. Bruce E. Zurlnick
Page 2
As of February 28, 2006


        (b) Nothing in this Agreement shall prevent the Company from increasing
the compensation to be paid to you if the Company shall determine it advisable
to do so in order to compensate you fairly for services rendered.

        (c) Notwithstanding anything herein to the contrary, in the event that
you are employed by the Company on February 28, 2009, you shall receive, with
the Company's regular March 2009 payroll cycle, in addition to your Base Salary
and Annual Bonus, a special bonus equal to 50% of your then current Base Salary.

     3. (a) The term of your employment hereunder shall continue until the
earliest of the following dates: (a) February 28, 2009 (b) the day on which you
die; (c) such date as the Company terminates your employment for "good cause";
(d) if you become "Totally Disabled" or (e) the day on which you voluntarily
resign. For purposes of this Agreement, you shall be Totally Disabled if, based
upon appropriate medical evidence, you are physically or mentally incapacitated
so as to render you incapable of performing the essential functions of your job
duties and such incapacity cannot be reasonably accommodated by the Company
without undue hardship. In the event your employment continues after the
expiration of the term without a superceding employment agreement, you will be
deemed to be an employee at-will of the Company whose employment may be
terminated by either the Company or you at any time, with or without notice or
cause.

        (b) The Company shall have "good cause" to terminate your employment (i)
if you have substantially failed to perform your job duties, (ii) in the event
of your willful misconduct in connection with your employment or intentional
breach of any of the Company's policies, (iii) if you have been convicted of, or
plead nolo contendere to, any crime constituting a felony under the laws of The
United States or any State thereof, or any crime constituting a misdemeanor
under any such law involving moral turpitude, or (iv) if you breach any
provision of this Agreement which you have failed to cure within ten business
days after written notice to you of such breach.

     4. (a) If the Company terminates your employment at any time for any reason
whatsoever, without "good cause", following your execution of a release and
waiver of all claims against the Company, you shall be entitled to receive, as
severance pay, in a lump sum, an amount equal to the greater of (i) your Base



Mr. Bruce E. Zurlnick
Page 3
As of February 28, 2006


Salary at your then current rate up to and including February 28, 2009 or (ii)
one year's Base Salary at your then current rate plus one year's bonus
calculated by averaging the Annual Bonus amounts paid or payable to you over the
course of the prior three fiscal years.

        (b) In the event your employment is terminated by reason of your death,
Total Disability, by you voluntarily or by the Company with or without "good
cause", you shall receive (i) any accrued but unpaid salary for services
rendered through and including the date of your death, Total Disability,
resignation or termination, as the case may be, (ii) any accrued but unpaid
expenses and (iii) any benefits to which you may be entitled pursuant to the
Company's employee benefits plans then in effect.

        (c) This Agreement supercedes and is in lieu of any other severance
payments to which you may be entitled under any other severance plans or
arrangements maintained by the Company, whether now existing or hereafter
implemented.

     5. (a) During the period commencing on the date hereof and ending on the
later to occur of (i) one year following the termination of your employment, or
(ii) February 28, 2009, you shall not (1) directly or indirectly, engage or be
interested in any fine jewelry business or (2) on behalf of yourself or any
business in which you may, directly or indirectly, be engaged or interested,
employ or otherwise engage, or seek to employ or engage, any individual employed
by the Company at any time during your employment hereunder. You will be
considered to be engaged or interested in a business if you engage or are
interested in such business as a stockholder, director, officer, employee,
agent, broker, partner, individual proprietor, lender, consultant or in any
capacity, except that nothing herein contained will prevent you from owning less
than 1% of any class of equity or debt securities listed on a national
securities exchange or traded in any established over-the-counter securities
market.

        (b) During the term of your employment hereunder and for a period of two
years thereafter, or as otherwise required by law, whichever is longer, you will
not knowingly divulge, furnish or make accessible to any third person or
organization, other than in the regular course of the Company's business, any
confidential information concerning the Company, its parent, subsidiaries or
affiliates or its or their business or affairs,



Mr. Bruce E. Zurlnick
Page 4
As of February 28, 2006


including without limitation, confidential methods of operation and
organization, employee information including salaries and qualifications,
confidential sources of supply and customer lists, and you shall not disparage
the Company, its business or affairs or any individual connected with the
Company.

        (c) In the event of any breach or threatened or attempted breach of this
paragraph 5, the Company shall be entitled to a decree of specific performance
and to a temporary and permanent injunction enforcing such provisions without
being required to prove actual damage or to post bond or furnish other security.
In any proceeding brought to enforce the provisions of this paragraph 5, the
party who prevails shall be entitled to recover its reasonable costs, including
attorneys' fees, from the losing party.

     6. This letter sets forth our final and entire agreement with respect to
its subject matter, cannot be changed, waived or terminated orally and shall be
governed by the internal law of the State of New York (without reference to its
rules as to conflicts of laws). The parties agree that any action or proceeding
with respect to this Agreement shall be brought in a court of competent
jurisdiction in the City, County and State of New York and that all claims with
respect to an inconvenient forum are irrevocably waived. This Agreement shall
bind and benefit the parties and their respective successors and assigns, but no
right or obligation hereunder may be assigned without the other party's written
consent, except by the Company to an enterprise that succeeds to a substantial
portion of its business or assets by purchase, merger, consolidation or
otherwise.

     7. If any provision of this Agreement shall be held to be invalid or
unenforceable, such invalidity or unenforceability shall attach only to such
provisions and shall not affect or render invalid or unenforceable any other
provision of this Agreement and this Agreement shall be construed as if such
provision had been drawn so as not to be invalid or unenforceable. The language
in this Agreement shall be construed according to its fair meaning and not
strictly for or against either party because that party drafted it.



Mr. Bruce E. Zurlnick
Page 5
As of February 28, 2006

     If the forgoing correctly sets forth your understanding of our agreement,
please so indicate by signing and returning to us a copy of this letter.


                                                FINLAY FINE JEWELRY CORPORATION



                                                By /s/ Arthur E. Reiner
                                                   -----------------------
                                                   Arthur E. Reiner
                                                   Chairman & CEO


ACCEPTED AND AGREED TO:



/s/ Bruce E. Zurlnick
---------------------------
Bruce E. Zurlnick