Exhibit 10.5

 

[G-III Letterhead]

 

December 9, 2016

 

Mr. Neal Nackman

43 Kensett Lane

Darien, CT 06820

 

Dear Neal:

 

This letter agreement, when accepted by you, shall confirm the agreement between
G-III Apparel Group, Ltd. (the “Company”) and you with respect to the matters
set forth herein.

 

Subject to the terms and conditions of this letter agreement, in the event the
Company shall terminate your employment without “Cause” (as such term is defined
in Executive Transition Agreement (the “Transition Agreement”), dated February
15, 2011, between the Company and you), the Company shall continue to pay
compensation to you and to provide benefits previously provided to you for a
period of twelve (12) months from the date your employment terminates (sometimes
referred to herein as the “severance amounts”). For the purposes of determining
compensation payable to you pursuant to the preceding sentence, your applicable
salary will be the highest annual rate of salary in effect during the one-year
period preceding the date your employment terminates, and you shall be deemed to
be entitled to an annual bonus for the 12-month severance period in an amount
equal to the average annual cash bonus earned by you during the two fiscal years
immediately preceding the fiscal year in which your employment terminates, it
being understood that the cash portion of the severance payments (including the
sum of the salary continuation at the annual rate referred to above and the
applicable deemed annual bonus amount described above) will be payable in equal
installments in accordance with the Company’s regular payroll schedule. The
Company may deduct and withhold from the payments to be made to you hereunder
any amounts required to be deducted and withheld by the Company under the
provisions of any applicable statute, law, regulation or ordinance now or
hereafter enacted.

 

Notwithstanding the foregoing, the Company’s obligation to pay or provide and
your right to receive severance amounts are conditioned upon (1) receipt by the
Company, within 60 days after the termination of your employment, of a duly
executed general release in the form of Exhibit A attached hereto which is no
longer subject to revocation. Subject to the preceding sentence, the payments
and benefits provided for under this letter agreement shall not be reduced or
affected by, or otherwise subject to any mitigation as a result of, any new
employment position you may commence or any other compensation you may receive
subsequent to the date your employment terminates. Subject to the provisions
hereof, including, without limitation, satisfaction of the release condition
imposed pursuant to this paragraph and any delayed payment requirement that may
be imposed by the following paragraph, severance amounts required to be paid or
provided under this Agreement shall be made or begin (x) with respect to such
amounts

 

 

 

 

that are subject to and not exempt from Section 409A of the Internal Revenue
Code of 1986, as amended at the end of the 60-day time period described above
and (y) with respect to all other such amounts, on the payroll date immediately
following the Company’s receipt of the release which is no long subject to
revocation; and, on such applicable payment commencement date, you will be
entitled to receive a single sum make-up payment equal to the sum of the
severance payments (or applicable unpaid portion thereof) you would have
received from the date of the event giving rise to such severance payments and
the delayed start date for such payments.

 

For purposes of Section 409A of the Internal Revenue Code of 1986 and the
regulations issued thereunder (“Section 409A”), each of the payments that may be
made under this letter agreement shall be deemed to be a separate payment. With
respect to the time of payment of any amounts under this letter agreement that
are deemed to be “deferred compensation” subject to Section 409A, references to
“termination of employment” (and terms of like import) shall mean “separation
from service” within the meaning of Section 409A. Notwithstanding any provision
to the contrary contained herein, if you are treated as a “specified employee”
within the meaning of Section 409A at the time of the termination of your
employment, any payment otherwise required to be made to you on account of such
termination of employment which is properly treated as deferred compensation
subject to Section 409A, shall be delayed until the first business day following
the earlier of (1) the date six months following such termination of employment,
or (2) the date of your death; and, on the payment date as so delayed, the
Company will make a single lump sum payment to you (or your estate, as the case
may be) equal to the aggregate amount of the payments that were so delayed. To
the extent you are entitled to receive taxable reimbursements and/or in-kind
benefits, the following provisions apply: (i) the amount of such reimbursements
and benefits you receive in one year shall not affect amounts provided in any
other year, (ii) such reimbursements must be made by the last day of the year
following the year in which the expense was incurred, and (iii) such
reimbursements and benefits may not be liquidated or exchanged for any other
reimbursement or benefit. The parties intend that all payments under this letter
agreement will be exempt from or will comply with Section 409A, as applicable,
and this letter agreement shall be construed and interpreted in a manner that is
consistent with that intent. Notwithstanding the foregoing, you shall be solely
responsible, and the Company shall have no liability, for any taxes,
acceleration of taxes, interest or penalties arising under Section 409A with
respect to any amounts payable under this letter agreement.

 

Except for the Transition Agreement, this letter agreement contains the entire
agreement of the parties with respect to the subject matter hereof, supersedes
all prior and contemporaneous agreements, both written and oral, between the
parties with respect to the subject matter hereof, and may be modified only by a
written instrument signed by each of the parties hereto. To the extent that
payments to you in connection with a termination of your employment in
connection with a “Change of Control” (as such term is defined in the Transition
Agreement) could be determined by the terms of both this letter agreement and
the Transition Agreement, the terms of the Transition Agreement shall apply to
determine such payments to you upon such a termination of your employment.

 

 -2- 

 

 

If the foregoing accurately sets forth our agreement, please execute two copies
of this letter agreement and return one fully executed copy to the undersigned.

 

  G-III APPAREL GROUP, LTD.

 

  By: /s/ Wayne S. Miller  

 

Accepted and Agreed to:

 

/s/ Neal Nackman   Neal Nackman

 

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EXHIBIT A

 

[Letterhead of G-III Apparel Group, Ltd.]

 

  [Date]

Mr. Neal Nackman

[Address]

 

Dear Neal:

 

This will confirm that your employment with G-III Apparel Group, Ltd.. (the
“Company”) has been terminated as of [date]. In exchange for your general
release and fulfillment of all of your commitments in this Agreement, which are
set forth below, the Company will pay you the severance amounts set forth in the
letter agreement, dated December ____, 2016, with the Company (the “Letter
Agreement”). In addition, you agree (i) not to disparage the Company or any of
its subsidiaries or affiliates (collectively, the “G-III Group”) or make or
cause to be made any statement that is critical of or otherwise maligns the
business reputation of the G-III Group and (ii) not to tortiously interfere in
any manner with the present or future business activities of the G-III Group.

 

The foregoing voluntary payment is given in return for your discharge and
release of all claims, obligations, and demands which you have, ever had, or in
the future may have, against any member of the G-III Group and any of its or
their stockholders, officers, directors, employees, or agents, arising out of or
relating to your employment and the termination thereof up to the date of this
Release, including, but not limited to, claims under Title VII of the Civil
Rights Act of 1964, the Fair Labor Standards Act, applicable New York State law,
the Civil Rights Act of 1991, the Age Discrimination in Employment Act, the
Older Workers Benefits Protection Act, the Employee Retirement Income Security
Act of 1974, the Americans With Disabilities Act, and all other federal, state,
and local discrimination laws, and claims for wrongful discharge. You further
waive and release any claimed right to reemployment, or employment in the future
with the Company or any other member of the G-III Group. You do not, however,
waive or release any claims which arise after the date that you execute this
agreement or any claims to enforce your rights to any payments or benefits owed
under the letter agreement or pursuant to any benefit plans or any claims or
rights to indemnification by the Company pursuant to any indemnification
agreement as may be in effect for your benefit or pursuant to the Company’s
articles of incorporation, bylaws or other governing documents.

 

The Company has advised you to consult with an attorney and/or governmental
agencies prior to executing this Agreement. By executing this Agreement you
acknowledge that you have been provided an opportunity to consult with an
attorney or other advisor of your choice regarding the terms of this Agreement,
that you have been given a minimum of twenty-one days in which to consider
whether you wish to enter into this Agreement, and that you have elected to
enter into this Agreement knowingly and voluntarily. You may revoke your assent
to this

 

 -4- 

 

 

Agreement within seven days of its execution by you (the “Revocation Period”),
and this Agreement will not become effective or enforceable until the Revocation
Period has expired.

 

If this is in accordance with our agreement, please sign and return to us the
enclosed copy of this Agreement, which shall then be a binding agreement between
us.

 

  G-III APPAREL GROUP, LTD.

 

  By:    

  Title:    

 

Agreed and Accepted:

 

    Neal Nackman

 

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