EX-10.41






Exhibit 10.41




June 25, 2008




Mr. Fritz Hirsch

c/o Sassy, Inc.

2101 Waukegan Road, Suite 203

Bannockburn, IL 600015



Dear Fritz:




     This letter serves to confirm the terms and conditions of your continuing employment as
President of Sassy, Inc. (“Sassy”), a wholly-owned subsidiary of Russ Berrie and Company, Inc.
(“RUSS”). Please be advised of the following elements of compensation:



     1. BASE COMPENSATION. Your base salary, effective January 1, 2008, will be at an
annual rate of $390,000 and will be payable bi-weekly in accordance with Sassy’s normal payroll
practices.



     2. INCENTIVE COMPENSATION. Your 2008 incentive compensation (bonus) program (the “IC
Plan”), and eligibility therefor, is set forth on Exhibit A attached hereto and
incorporated herein. Your performance targets under the IC Plan will be established annually by
the Compensation Committee of the Board of Directors of RUSS, in consultation with the CEO of RUSS
and you.



     3. STOCK OPTIONS. The possible issuance of equity awards in 2008 has not yet been
specifically determined. However, when such determination is made and approved by the Compensation
Committee of RUSS’ Board of Directors, you will be considered for a grant of equity at the level of
other senior executives at RUSS who will be considered for such grant. The options will be granted
under and pursuant to the Company’s 2004 Stock Option, Restricted and Non-Restricted Stock Plan or
a successor plan. Possible future grants of equity awards shall be at the sole discretion of the
Compensation Committee of the Board of Directors of RUSS.



     4. BENEFITS. You will continue to be eligible to participate in Sassy’s pension, life
insurance, hospitalization, major medical and other employee benefit plans to which you have
heretofore been eligible and their successor and/or replacement plans (to the extent that they
continue to be offered to eligible employees). You shall also be eligible for any new or enhanced
employee benefit plans generally applicable to senior executives of Sassy that are approved by the
Compensation Committee of RUSS in the future.



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     5. VACATION. You will continue to be eligible for four weeks paid vacation per year
in accordance with Sassy’s policies. You will also continue to be entitled to the paid holidays
and other paid leave set forth in Sassy’s policies.



     6. COMPANY CAR. You will continue to be entitled to the benefit of Sassy’s lease of
an Audi A6. Upon the expiration of that lease, you shall be entitled to the same level of benefits
relating to the same or similar lease of an automobile on your behalf.



     7. SEVERANCE. In the event that your employment with Sassy is terminated for reason
other than Cause (as defined in RUSS’ Change-in-Control Severance Plan) or your own voluntary
resignation, then you will be eligible to receive severance in accordance with RUSS’ Severance Plan
for Domestic Vice Presidents (and Above) (the “VP Policy”) in accordance with at least such VP
Policy’s current terms and provisions, as further supplemented and revised below, for a period
equal to the longer of (i) the period ending December 31, 2009 or (ii) the period ending twelve
months from the date of termination. A copy of the VP Policy is attached hereto as Exhibit
B. References in the VP Policy to “Company” shall be read as references to “Sassy” and
references to the “severance payments” or “severance period” shall be read as references to the
severance period as modified hereby. By way of supplement to the VP Policy, should you obtain
gainful employment during the severance period and that employment is at a base compensation rate
less than your severance compensation rate, then you shall be entitled to the difference between
those rates until the earlier of (i) the end of the severance period, and (ii) your obtaining
gainful employment at a base compensation rate that is not less than the severance compensation
rate. By way of revision to the VP Policy, you shall be entitled to the benefits of a company car
(described under paragraph 6 of the Employment Agreement) for the duration of the severance period.
Also by way of revision to the VP Policy, you shall be entitled to the benefits of the VP Policy
in the event that you terminate your employment for “Good Reason,” as such term is defined in the
RUSS Change in Control Severance Plan (the “CIC Plan”); provided, that requiring you to travel to
Sassy’s Michigan office or other offices maintained by RUSS (or other domestic or international
travel incident to your employment) on a regular basis shall not be considered Good Reason; and
provided, further, that changes in your reporting structure outside of the Sassy organization shall
not trigger clause (A) of such definition. In addition, you are currently eligible to participate
in the CIC Plan, a copy of which is attached hereto as Exhibit C. The parties acknowledge
that RUSS intends to amend the VP Policy and the CIC Plan during 2008 to bring such plans into
compliance with the provisions of Section 409A of the Internal Revenue Code. RUSS acknowledges
that any such amendments will not be intended to reduce the dollar value of your potential benefits
under such plans.



     8. TERM. The term of your employment will be for the period ending December 31, 2009.
For the avoidance of doubt, the expiration of the term set forth herein will not affect your
rights to severance, which shall be governed by the provisions of paragraph 7 above. In the event
that Sassy elects not to renew this Agreement beyond the expiration of the term hereof (other than
for Cause), such election shall be deemed to be a termination without cause, and you shall be
entitled to the severance set forth in paragraph 7 above.



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     9. CONFIDENTIALITY. You shall, during and after your employment by Sassy and except
in connection with performing services on behalf of (or for the benefit of) Sassy or any of its
parents, subsidiaries or affiliates (the “Employer Group”), keep secret and retain in the strictest
confidence all confidential, proprietary and non-public matters, tangible or intangible, of or
related to the Employer Group, its stockholders, subsidiaries, affiliates, successors, assigns,
officers, directors, attorneys, fiduciaries, representatives, employees, licensees and agents
including, without limitation, trade secrets, business strategies and operations, customer lists,
manufacturers, material suppliers, financial information, personnel information, legal advice and
counsel obtained from counsel, information regarding litigation, actual, pending or threatened,
research and development, identities and habits of employees and agents and business relationships,
and shall not disclose them to any person, entity or any federal, state or local agency or
authority, except as may be required by law. Notwithstanding the foregoing, nothing in this
Agreement or elsewhere shall prohibit you from making any statement or disclosure (i) to the extent
required by law; (ii) to the extent required by subpoena or other legal process (upon receipt of
which you shall immediately give Sassy and RUSS written notice thereof in order to afford the same
an opportunity to contest such disclosure); (iii) with the Employer Group ‘s prior written consent;
or (iv) in confidence to an attorney for the purpose of obtaining legal advice. Upon termination
of your employment with Sassy, you shall return to Sassy all confidential, proprietary and
non-public materials, and any other property of Sassy or the Employer Group, in your possession.



     10. NON-COMPETE; NONSOLICITATION. You agree that during your employment by Sassy and
for a period thereafter during which you receive any severance payments hereunder (the
“Post-Employment Period”), you shall not, directly or indirectly, engage or be interested in (as
owner, partner, stockholder, employee, director, officer, agent, fiduciary, consultant or
otherwise), with or without compensation, any business whose products or activities compete in
whole or in part with the products or activities of any member of the Employer Group anywhere
within the United States or in any other jurisdiction in which any member of the Employer Group
offers products for sale, provided, however, that you may purchase or otherwise acquire up
to (but not more than) two percent of any class of securities of any enterprise (but without
otherwise participating in the activities of such enterprise) if such securities are listed on any
national or regional securities exchange or have been registered under Section 12(g) of the
Securities Exchange Act of 1934. You also agree that during the Post-Employment Period, you shall
not, directly or indirectly, solicit the employment or retention of (or attempt, directly or
indirectly, to solicit the employment or retention of or participate in or arrange the solicitation
of the employment or retention of) any person who is to your knowledge then employed or retained by
any member of the Employer Group.



     11. NONDISPARAGEMENT. You shall, after your employment with Sassy has terminated,
refrain from any action that could reasonably be expected to harm the reputation or goodwill of any
member of the Employer Group and any shareholder holding more than 5% of any such member’s voting
securities, including, without limitation, making derogatory comments about the character or
ability of any directors, officers, employees, shareholders, agents or representatives of any
member of the Employer Group. Each member of the Employer Group shall, after your employment with
Sassy has terminated, refrain from any action that could



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reasonably be expected to harm your reputation, including, without limitation, making
derogatory comments about your character or ability.




     12. REMEDY FOR BREACH AND MODIFICATION. You acknowledge that the provisions of this
Agreement are reasonable and necessary for the protection of the Employer Group and that the
Employer Group may be irreparably damaged if these provisions are not specifically enforced.
Accordingly, you agrees that, in addition to any other relief or remedies available to the Employer
Group, the Employer Group shall be entitled to seek appropriate temporary, preliminary and
permanent injunctive or other equitable relief for the purposes of restraining you from any actual
or threatened breach of or otherwise enforcing these provisions and no bond or security will be
required in connection therewith. In addition, notwithstanding any provision in this Agreement to
the contrary, if you breach any of the provisions of Sections 9, 10 or 11 of this Agreement at any
time and such breach is either (x) willful and not inconsequential or (y) in a material respect and
not cured promptly after notice from the Employer Group, you shall not thereafter be entitled to
any payments or benefits under this Agreement or any severance program.



     13. SEVERABILITY. If any provision of this Agreement is deemed invalid or
unenforceable, such provision shall be deemed modified and limited to the extent necessary to make
it valid and enforceable.



     14. EXPENSES. Each of Sassy and you shall bear its own expenses for the preparation
and negotiation of this Agreement, provided that Sassy shall reimburse you for your legal fees with
respect to this Agreement up to a maximum of $10,000.



     Sassy and RUSS reserve the right to change or modify these programs. Subject to paragraph 9
above, employment with Sassy and/or RUSS is considered “at-will” and does not represent a specific
guarantee.



	 	 	 
	 

	 	Very truly yours,
	 
	 	 
	 

	 	/s/ Bruce G. Crain
	 
	 	 
	 

	 	Bruce G. Crain
	 

	 	President and CEO






ACCEPTED AND AGREED:




	 	 	 
	/s/ Fritz Hirsch
 

Fritz Hirsch

	 	  







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