Exhibit 10.31
 
SEVERANCE AGREEMENT AND GENERAL RELEASE
 
FINLAY FINE JEWELRY CORPORATION, its parent corporation, affiliates,
subsidiaries, successors, assigns, current and former employees, directors and
agents (collectively "Finlay") and LESLIE PHILIP, whose address is 67 Orchard
Street, Manhasset, NY 11030, hereby agree that:
 
1.           Your employment has terminated effective May 26, 2009 (the
"Termination Date").  You have been paid your salary earned through the
Termination Date in accordance with Finlay's regular payroll cycle (unless
otherwise required by local law).
 
2.           Under Finlay's regular policies, you are eligible:
 
a.           To receive your vested accounts, if any, under the 401(k)
plan.  You will receive more detailed information regarding your 401(k) benefits
under separate cover.
 
b.           To receive payment for your accrued but unused vacation and
personal days.
 
c.           If you are currently enrolled in Finlay's health insurance plans,
to continue such health insurance coverage in accordance with COBRA, for a
minimum of eighteen (18) months from the Termination Date, upon payment of the
full applicable premiums.  You have received under separate cover more detailed
information regarding insurance benefits under COBRA.  Nothing contained in this
Severance Agreement and General Release (the "Agreement and Release") is
intended to impair any of these rights.
 
3.           In consideration for signing this Agreement and Release, in lieu of
any other severance, retention or bonus payments to which you might otherwise be
entitled under Finlay’s regular policies, commencing on Finlay's regular pay
date immediately following the last to occur of your execution of this Agreement
and Release, the Termination Date and the Employee Irrevocability Date, you will
receive, in six (6) installments, severance pay totaling twelve (12) weeks’
salary (i.e. $112,082.31), less applicable taxes and other withholding.  
 
Notwithstanding anything herein to the contrary, the payment of any benefits
hereunder in excess of two (2) months’ base salary (the “Mitigated Benefits”)
shall be reduced by an amount equal to the gross amounts you received or earned
as compensation, profits or otherwise from your employment or engagement in any
business or activity with Finlay (excluding any investment income or capital
gains) with respect to the same period for which such Mitigated Benefits are
payable (“Other Income”).  As a condition to receipt of payment of the Mitigated
Benefits, you shall, no later than seven (7) days prior to the date such payment
is due, certify in writing to the Senior Vice President, Human Resources of
Finlay, all amounts of Other Income earned by you during the preceding payroll
period so that the appropriate offsets can be made.

 
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You understand and agree that you would not receive the payment specified in
this section "3" above, except for your execution of this Agreement and Release
and the fulfillment of the promises contained herein.

4.           You understand that Finlay makes no representation as to the income
tax treatment of any payments hereunder and that any and all payments (and all
compensation, benefits and/or other payments previously made to you by Finlay)
will be subject to such tax treatment and to such deductions, if any, as may be
required under applicable tax laws.
 
You affirm that you have been paid and/or received all compensation, wages,
bonuses, commission, and/or benefits, to which you may be entitled and that no
other compensation, wages, bonuses, commissions and/or benefits are due to you
except as provided in this Agreement and Release.
 
5.           a.You agree that you will take no action, which is intended, or
would reasonably be expected to harm Finlay, to impair Finlay's reputation, or
to lead to unwanted or unfavorable publicity to Finlay, nor will you disclose
any confidential or proprietary information obtained by you during the course of
your employment.
 
b.   In consideration of the terms hereof, you hereby agree and forever waive
any claims you may have for re-employment by Finlay.
 
6.           It is expressly understood and agreed that this Agreement and
Release and the effectuation of its terms do not constitute an admission or
statement by any party that Finlay has acted unlawfully or is otherwise liable
in any respect.  It is further agreed that evidence of this Agreement and
Release, its terms or the circumstances surrounding the parties entering into
this Agreement and Release, shall be inadmissible in any action or lawsuit of
any kind, except for an action for alleged breach of this Agreement and Release.
 
7.           You agree not to disclose any information regarding the existence
or substance of this Agreement and Release, except to an attorney with whom you
choose to consult regarding your consideration of this Agreement and Release,
your spouse/life partner or your tax advisor.

 
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8.           You knowingly and voluntarily release and forever discharge Finlay,
of and from any and all claims, known and unknown, which against Finlay you and
your heirs, executors, administrators, successors and assigns (referred to
collectively throughout this Agreement and Release as "you") have or may have as
of the date of execution of this Agreement and Release, including, but not
limited to, any alleged violation of:
 
*
The National Labor Relations Act, as amended;

 
*
Title VII of the Civil Rights Act of 1964, as amended;

 
*
Sections 1981 through 1988 of Title 42 of the United States Code, as amended;

 
*
The Civil Rights Act of 1991;

 
*
The Age Discrimination in Employment Act of 1967, as amended;

 
*
The Employee Retirement Income Security Act of 1974, as amended;

 
*
The Immigration Reform and Control Act, as amended;

 
*
The Americans with Disabilities Act of 1990, as amended;

 
*
The Worker Adjustment and Retraining Notification Act, as amended;

 
*
The Occupational Safety and Health Act, as amended;

 
*
The Family and Medical Leave Act of 1993;

 
*
The Lilly Ledbetter Fair Pay Act of 2009;

*
The New York Human Rights Law, as amended;

*
The New York Equal Pay Law, as amended;

*
The New York Smokers' Rights Law, as amended;

*
The New York Equal Rights Law, as amended;

 
*
any other federal, state or local civil or human  rights law or any other local,
state or federal law, regulation or ordinance;

 
*
any public policy, contract, tort, or common law; or

 
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*
any allegation for costs, fees, or other expenses including attorneys' fees
incurred in these matters.

 
9.           You affirm that you have not filed, caused to be filed or are
presently a party to any claim, complaint, or action against Finlay in any form
or forum.  You furthermore affirm that you have no known workplace injuries.
 
10.         You understand that if this Agreement and Release were not signed,
you would have the right to voluntarily assist other individuals or entities in
bringing claims against Finlay.  You hereby waive that right and you will not
provide any such assistance other than assistance in an investigation or
proceeding conducted by an agency of the United States government.  Moreover,
you shall not be entitled to receive any relief, recovery or monies, including
attorneys' fees, in connection with any complaint or charge brought against
Finlay, without regard as to who brought any said complaint or charge.
 
11.         You acknowledge that you returned to Finlay on the Termination Date,
your keys, identification and any other equipment, documents or materials
belonging to Finlay that you had in your possession, including any lists of
customer names, contact information and purchasing histories.
 
12.         In the event that you breach any provision of this Agreement and
Release, Finlay will be entitled to obtain all relief provided by law or equity
in addition to its attorneys' fees and costs, including instituting an action
against you to obtain specific enforcement of the terms of this Agreement and
Release.
 
13.         This Agreement and Release shall be binding on the parties and their
respective successors and assigns.
 
14.         This Agreement and Release sets forth the entire agreement between
the parties with respect to the subject matter herein and fully supersedes any
and all prior agreements or understandings between them regarding such subject
matter.  You acknowledge that you have not relied on any representations,
promises, or agreements of any kind made to you in connection with your decision
to accept this Agreement and Release except for those set forth in this
Agreement and Release.
 
15.         This Agreement and Release may not be modified, altered or changed
except upon express written consent of both parties wherein specific reference
is made to this Agreement and Release.
 
16.         If any provision of this Agreement and Release should be held
invalid or unenforceable by operation of law or by any tribunal of competent
jurisdiction, or if compliance with or enforcement of any provision is
restrained by such tribunal, the application of any and all provisions other
than those which have been held invalid or unenforceable, shall not be effected,
and the remainder of this Agreement and Release shall be in full force and
effect.

 
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17.         This Agreement and Release shall be governed and construed in
accordance with the laws of the State of New York (including Section 5-1401 of
the New York General Obligations Law).  Any dispute arising hereunder shall be
brought before a court of competent jurisdiction in the City, County and State
of New York.

18.         You may revoke this Agreement and Release for a period of seven (7)
calendar days following the day you execute this Agreement and Release.  Any
revocation within this period must be submitted, in writing, to Deborah A.
Dixon, and state, "I hereby revoke my acceptance of our Severance Agreement and
General Release."  The revocation must be personally delivered to Ms. Dixon or
her designee, or mailed to her at Finlay Fine Jewelry Corporation, 529 Fifth
Avenue, 4th Floor, New York, NY  10017 and postmarked within seven (7) calendar
days of execution of this Agreement and Release.  This Agreement and Release
shall not become effective or enforceable until the revocation period has
expired (the "Employee Irrevocability Date").  If the last day of the revocation
period is a Saturday, Sunday or legal holiday in New York, then the revocation
period shall not expire until the next following day which is not a Saturday,
Sunday or legal holiday.
 
19.         You represent and affirm that you are able to execute this Agreement
and to waive any and all claims you have or may have against Finlay and that
such execution and waiver are not affected or impaired by illness, use of
alcohol, drugs or other substances.  You further represent and affirm that you
have had an opportunity to consult with your health care provider to confirm
your competency to execute this Agreement and Release and have either consulted
with your health care provider and confirmed you are competent to execute this
Agreement and Release or determined that it is not necessary to consult with
your health care provider about this issue.
 
20.         Attached as Exhibit "A" is a list of the job titles and ages of all
individuals eligible for the severance package.  Attached as Exhibit "B" is a
list of the job titles and ages of all individuals ineligible for the severance
package.

 
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YOU ACKNOWLEDGE THAT YOU HAVE BEEN ADVISED IN WRITING THAT YOU HAVE AT LEAST
FORTY-FIVE (45) CALENDAR DAYS TO CONSIDER THIS SEVERANCE AGREEMENT AND GENERAL
RELEASE AND TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTION OF THIS SEVERANCE
AGREEMENT AND GENERAL RELEASE.
 
YOU AGREE THAT ANY MODIFICATIONS, MATERIAL OR OTHERWISE, MADE TO THIS SEVERANCE
AGREEMENT AND GENERAL RELEASE DO NOT RESTART OR AFFECT IN ANY MANNER THE
ORIGINAL FORTY-FIVE (45) CALENDAR DAY CONSIDERATION PERIOD.
 
HAVING ELECTED TO EXECUTE THIS SEVERANCE AGREEMENT AND GENERAL RELEASE, TO
FULFILL THE PROMISES SET FORTH HEREIN, AND TO RECEIVE THEREBY THE PAYMENT SET
FORTH IN SECTION "3" ABOVE, YOU FREELY AND KNOWINGLY, AND AFTER DUE
CONSIDERATION, ENTER INTO THIS SEVERANCE AGREEMENT AND GENERAL RELEASE INTENDING
TO FOREVER WAIVE, SETTLE AND RELEASE ALL CLAIMS YOU HAVE OR MIGHT HAVE AGAINST
FINLAY.

 
IN WITNESS WHEREOF, the parties hereto knowingly and voluntarily execute this
Agreement and Release as of the date set forth below:

/s/ Leslie Philip
Leslie Philip
 
May 21, 2009
Date
 
FINLAY FINE JEWELRY CORPORATION
 
By
/s/ Deborah A. Dixon
 
Deborah A. Dixon, Sr. VP, H.R.
   
May 21, 2009
Date

 
 
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EXHIBIT A

INDIVIDUALS ELIGIBLE AND/OR SELECTED FOR SEVERANCE PACKAGE

Position
 
Age
 
Position
 
Age
Financial Analyst
 
31
 
Marketing Assistant
 
26
Traffic Manager
 
50
 
Accountant
 
54
Marketing Coordinator
 
24
 
Merchandise Special Order Coordinator
 
27
Housekeeper and Office Services Support
 
60
 
Accounts Payable Associate
 
40
Accounts Payable Associate
 
53
 
Programmer/Analyst
 
52
Vendor Analyst
 
69
 
Merchandise Payables Supervisor
 
58
Loss Prevention Regional Investigator
 
49
 
Traffic Coordinator
 
28
Assistant Production Manager
 
28
 
Vendor Financial Relations Supervisor
 
47
Applications Manager, IS&T
 
67
 
UNIX Administrator
 
34
Assistant Merchandise Planner
 
23
 
Assistant Merchandise Buyer
 
45
Sr. Vendor Analyst
 
50
 
Director of Customer Relationship Management
 
34
Staffing Analyst
 
32
 
Employee Communications Coordinator & Recruiter
 
27
Assistant Merchandise Planner
 
26
 
Director of IT Architecture & Operations
 
46
Sr. Financial Analyst
 
41
 
VP of Expense Control & Profit Improvement
 
57
Data Center/MIS Manager
 
54
 
Staffing Analyst
 
33
Merchandise Planner
 
36
 
Assistant Merchandise Buyer
 
27
Merchandise Analyst
 
53
 
Administrative Assistant
 
43
Vendor Financial Relations Supervisor
 
35
 
Public Relations & Special Events Manager
 
31
Merchandise Special Order Coordinator
 
23
 
Programmer & Jr. DBA
 
65
HRIS & Sr. Sales Staffing Analyst
 
37
 
Programmer/Analyst
 
49
Sales & Use Tax Accountant
 
39
 
Jr. Tax Accountant
 
28
Moissanite Buyer
 
37
 
Merchandise Sr. Buyer
 
44
UNIX Sr. Systems Administrator
 
58
 
Assistant Merchandise Planner
 
22
Assistant Merchandise Planner
 
43
 
Accounts Payable Associate
 
38
Director of Repair
 
54
 
EVP, Merchandising
 
62
Moissanite Buyer
 
57
 
Assistant Merchandise Planner
 
25
Assistant Merchandise Buyer
 
26
 
Assistant Merchandise Buyer
 
24
Director of Training & Performance Management
 
42
 
Assistant Merchandise Planner
 
25
Accounts Payable Clerk
 
40
 
Loss Prevention Regional Investigator
 
45
Sr. Programmer/Analyst
 
40
 
Desktop Support Analyst
 
27
Staff Accountant
 
60
 
Special Events Buyer
 
39
Assistant Merchandise Planner
 
40
 
Vice President of Store Design & Construction
 
46
Programmer/Analyst
 
42
 
Merchandising Assistant
 
23
Vendor Analyst
 
41
 
Administrative Assistant
 
52
Assistant Marketing Manager
 
37
 
Administrative Assistant
 
43
Database Service Manager
 
47
 
Administrative Assistant
 
28
Sr. Graphic Designer
 
48
 
Merchandise Buyer
 
84
Executive Assistant to our President & CEO
 
51
 
Sr. Manager for Public Relations & Special Events
 
50
Assistant Merchandise Buyer
 
42
 
Assistant Special Events Buyer
 
25
Business Analyst Manager
 
34
 
Sr. Programmer/Analyst
 
44

 
 
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EXHIBIT A (continued)

Position
 
Age
 
Position
 
Age
Benefits Administrator
 
45
 
Group Manager, Bon Ton
 
36
Administrative Assistant
 
59
 
Vice President/Group Manager, Macy's Central
 
50
Group Manager, Dillard's
 
45
 
Sr. Programmer/Analyst
 
45
Assistant Merchandise Planner
 
27
 
Applications Manager, IS&T
 
55
Director of Benefits
 
31
 
Sr. Programmer/Analyst
 
58
Senior Vice President of Operations & Loss Prevention
 
56
 
Executive Assistant to our Chairman
 
47
President & CEO
 
58
 
Senior Vice President of Human Resources
 
46
Director of Human Resources
 
46
 
Accountant
 
22
Assistant Merchandise Planner
 
26
 
Desktop Support & Telecomm Manager
 
52
Assistant Merchandise Planner
 
24
 
Systems Analyst
 
30
Merchandise Analyst
 
45
 
Loss Prevention Regional Investigator
 
49
Construction Manager
 
36
 
Vice President of Systems Development
 
51
Financial Analyst
 
35
 
Vice President, Secretary & General Counsel
 
51
Benefits Manager
 
46
 
Sr. Security Engineer/Architect
 
50
Vendor Analyst
 
53
 
Paralegal/Secretary
 
31
Merchandise Planner for Watches
 
41
 
Payroll Clerical
 
45
Clerical in our Finance Department
 
54
 
SQL DBA
 
42
Vendor Analyst
 
59
 
Accounts Payable Associate
 
62
Sales Audit
 
30
 
Sr. Manager/DBA
 
44
Payroll Supervisor
 
31
 
Systems Analyst
 
38
Vendor Analyst
 
64
 
Lab Technician
 
53
Vice President & DMM
 
47
 
Vendor Financial Relations Supervisor
 
36
Business Analyst
 
30
 
Technical Accounts Payable Manager
 
45
Loss Prevention Auditor
 
55
 
Computer Room Supervisor
 
50
Sr. Merchandise Planner
 
46
 
UNIX Administrator
 
50
Merchandise Buyer
 
29
 
Vice President & Controller
 
41
Associate Merchandise Buyer
 
45
 
General Accounting Supervisor
 
36
Loss Prevention Auditor
 
31
 
Assistant Controller & Sales Audit
 
59
Executive Assistant to Regional Vice President
 
64
 
Director of Vendor Financial Relations
 
58
Desktop Technician
 
37
 
Vice President of Tax
 
58
Assistant Merchandise Buyer
 
35
       

 
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EXHIBIT B

INDIVIDUALS INELIGIBLE FOR SEVERANCE PACKAGE

Position
 
Age
 
Position
 
Age
System Analyst
 
35
 
Special Order Coordinator - Watches
 
45
System Analyst
 
35
 
Clerical - Ad Samples for Precious, Semi, & Pearls
 
67
Lease Administrator
 
32
 
Merchandise Coordinator
 
51
Production Manager
 
42
 
Clerical
 
54
Payroll Tax Accountant
 
52
 
Office Services Assistant
 
57
Budget & Staffing Analyst
 
28
 
Benefits Assistant
 
24
Supervisor, Expense Payables
 
51
 
Office Services Assistant
 
53
Programmer
 
41
 
Clerical - Received Merchandise
 
58
Art Director
 
33
 
Chairman & CEO
 
68
Supervisor, Sales Audit
 
44
 
EVP, Administration
 
54
Merch. Analyst - Richemont
 
33
 
SVP, CFO
 
57
Supervisor, Accounting
 
56
 
SVP, CIO
 
53
Merch. Analyst - Designer
 
38
 
RVP
 
51
Manager, Office Services
 
49
 
RVP/Group Manager
 
44
Associate Buyer Diamond Fashion
 
26
 
Applications Manager, IS&T
 
35
Coordinator, PR & Special Events
 
27
 
Assistant Tax Director
 
51
Merch Analyst - Dept. Store Diamonds
 
26
 
Director, Loss Prevention
 
62
Jr. Business Analyst
 
26
 
Director, Financial Reporting
 
38
Asst. Buyer Semi-Precious
 
23
 
Director, Group Operations
 
38
Asst. Buyer Bridal & Solitaire
 
23
 
Sr. Planner Bridal & Solitaire
 
53
Administrative Assistant
 
34
 
VP, Staffing
 
49
Tax Accountant
 
49
 
Director, Corporate Accounting
 
52
Telecomm Analyst
 
37
 
Manager, Vendor Financial Relations
 
55
Vendor Analyst
 
53
 
Marketing Director
 
47
Staff Accountant - Gen. Accounting
 
36
 
Asst. Controller, Payroll
 
58
Fixed Assets Auditor
 
59
 
Buyer Precious & Semi
 
40
A/P Associate - Expense
 
58
 
Director, Credit
 
63
A/P Associate - Merch. Payables
 
61
 
Planner - Gold Dept. Store
 
49
HR Assistant
 
26
 
Assistant Director, Loss Prevention
 
47
Administrative Assistant
 
47
 
Cash Manager
 
46
Accountant
 
28
 
Buyer - Gold Dept. Store
 
33
Jr. Accountant
 
34
 
Associate Buyer Diamond Fashion
 
25
Clerical
 
41
 
Group Manager - Gottschalk's
 
37

 
 
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