8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported):

June 7, 2010

Rosetta Stone Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-34283	043837082
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification Number)

1919 North Lynn St., 7th Fl., Arlington, Virginia 22209

(Address of principal executive offices, including zip code)

800-788-0822

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02.Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(b)  On June 7, 2010, Brian D. Helman informed Rosetta Stone Inc. (the “Company”) of his intention to leave his position as the Company’s Chief Financial Officer on August 31, 2010 in order to relocate back to Florida.  Mr. Helman will assist in the search for and transition to a successor.  A copy of Rosetta Stone’s press release is attached hereto as Exhibit 99.1.

In connection with Mr. Helman’s resignation, the Company has entered into a Transition Agreement with Mr. Helman dated June 7, 2010.  Conditioned upon his continuation of service through August 31, 2010 or such earlier date as the Company may choose and his execution of a release, the agreement provides that he will receive the amount of $90,000, less applicable withholding and deductions.

The foregoing description of the Transition Agreement is a summary only and is qualified in its entirety by reference to the Transition Agreement which is filed herewith as Exhibit 10.1 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit Number	Description of Exhibit
10.1	Transition Agreement between Rosetta Stone Inc. and Brian D. Helman, dated June 7, 2010.
99.1	Press Release, dated June 8, 2010.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date:  June 8, 2010

By:	/s/ Michael C. Wu
	Name:	Michael C. Wu
	Title:	General Counsel and Secretary

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EXHIBIT INDEX

Exhibit Number	Description of Exhibit
10.1	Transition Agreement between Rosetta Stone Inc. and Brian D. Helman, dated June 7, 2010.
99.1	Press Release dated June 8, 2010.

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EX-10.1

Exhibit 10.1

June 7, 2010

By Hand Delivery

Brian D. Helman

Rosetta Stone Inc.

1919 Lynn St., 7th floor

Arlington, VA 22209

Dear Brian:

This letter, upon your signature, supplements your employment agreement dated February 20, 2009 (the “Employment Agreement”) to the extent set forth herein.  The Employment Agreement together with this letter shall constitute the complete agreement (“Transition Agreement”) between you and Rosetta Stone Inc. (“Rosetta Stone” or the “Company”) regarding your continued employment.  The purpose of this Transition Agreement is to facilitate an orderly transition while the Company searches for a new Chief Financial Officer in connection with your decision to leave the Company to pursue other opportunities.

The terms of the Transition Agreement are as follows:

1.Employment Commitment.  During the period from the date of this letter until August 31, 2010 (the “Transition Period”), you agree to remain employed with the Company, subject to the Company’s right to terminate your employment as set out below.

2.Compensation and Benefits.  During the Transition Period, you will continue to receive your current base salary and participate in the Company’s benefit plans as long as you are an active employee of the Company, in accordance with the terms of such benefit plans.

3.Duties and Authority.  You will continue to serve full time as the Company’s Chief Financial Officer until such time as the Company appoints a successor. Following such appointment, you will continue to report to the Company’s Chief Executive Officer during the Transition Period and will assist with a transition of your successor into his or her role as Rosetta Stone’s Chief Financial Officer.

4.Transition Bonus Payment.  As an incentive for you to remain with the Company through the Transition Period, you will be paid a transition bonus in the amount of $90,000 (the “Transition Bonus”), subject to the “Transition Bonus Conditions” provided below.  The Transition Bonus will be paid, less applicable withholdings and deductions, on the next regularly scheduled pay date following August 31, 2010, unless local law requires that it be paid sooner.

5.Transition Bonus Conditions.  In order to receive the Transition Bonus, you must be a full-time, active employee of the Company throughout the entire applicable Transition Period, subject to the following conditions:

A.Prior to the end of the Transition Period, if Rosetta Stone terminates your employment without Cause, as defined in the Employment Agreement, in exchange for a valid release

of claims against the Company as described below, you shall be entitled to receive the Transition Bonus on the date payment would otherwise have been made to you under the terms of the Transition Agreement.

B.Prior to the end of the Transition Period, if Rosetta Stone terminates your employment for Cause, as defined in the Employment Agreement, you will not be entitled to receive the Transition Bonus.  In this event, the Transition Bonus will automatically be forfeited.

6.Release of Claims.  You will execute a release substantially in the form of Exhibit A to the Employment Agreement, and not revoke within the revocation period, as consideration for the Transition Agreement and the payment of the Transition Bonus.

7.Confirmation of Existing Employee Obligations.  You understand and agree that this Transition Agreement does not cancel or otherwise diminish any of your post-employment obligations under the Employment Agreement with the Company, including, but not limited to, confidentiality, noncompetition and non-solicitation obligations.

8.Scope.  Except for Section 6(a) of the Employment Agreement, and as specifically and expressly amended herein, the terms and conditions of the Employment Agreement are hereby ratified and confirmed, and shall remain in full force and effect.  In the event of any irreconcilable inconsistency between the terms of the Transition Agreement and the Employment Agreement, the terms of the Transition Agreement shall prevail.

Please sign and date one copy of this letter and return to me.  An extra copy is enclosed for your files.

Sincerely,

/s/ Tom Adams

Tom P.H. Adams

President and Chief Executive Officer

Rosetta Stone Inc.

Agreed and Accepted:

/s/ Brian D. Helman	6/7/10
Brian D. Helman	Date

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

Rosetta Stone Announces Upcoming Departure of Chief Financial Officer

ARLINGTON, Va. (June 8, 2010) — Rosetta Stone Inc. (NYSE:RST), a leading provider of technology-based language-learning solutions, today announced that Brian D. Helman intends to leave his position as Chief Financial Officer, on August 31, 2010, in order to relocate back to Florida.  Mr. Helman will assist in the search for and transition to a successor.

Mr. Helman joined the Company in 2007 during which time he oversaw the Company’s implementation of many operational functions and financial systems and its successful initial public offering on the New York Stock Exchange.

Tom Adams, president and CEO, said, “We greatly appreciate Brian’s contributions to Rosetta Stone. He played an instrumental role in building extremely strong finance and accounting organizations that have supported our rapid growth and global expansion as well as our successful IPO last year. Brian’s efforts in building a solid financial foundation will serve the company well in the years to come and we wish him well in his future endeavors.”

“Rosetta Stone is a tremendous company and it has been incredibly rewarding to help build the world’s leading provider of technology-based language-learning solutions,” said Helman.  “I thoroughly enjoyed working with Tom and the entire Rosetta Stone team. While this is a difficult decision for me, it is the right time for me to focus on personal priorities. I will ensure a smooth and successful transition over the coming months.”

For more information please visit pr.RosettaStone.com.

About Rosetta Stone

Rosetta Stone Inc. is changing the way the world learns languages. Rosetta Stone provides interactive solutions that are acclaimed for the power to unlock the natural language-learning ability in everyone. Available in more than 30 languages, Rosetta Stone language-learning solutions are used by schools, organizations and millions of individuals in over 150 countries throughout the world. The company was founded in 1992 on the core beliefs that learning a language should be natural and instinctive and that interactive technology can replicate and activate the immersion method powerfully for learners of any age. The company is based in Arlington, Va. For more information, visit RosettaStone.com.

“Rosetta Stone” is a registered trademark of Rosetta Stone Ltd.

Media Contact:

Reilly Brennan

rbrennan@rosettastone.com

703.387.5863

Investor Contact:

Christopher Martin

cmartin@rosettastone.com

703.387.5927

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