Neiman Marcus 2003 Annual Report Download - page 315

(i) the stock distributed pursuant thereto shall be credited to the Employee's account with the Registrar with respect to those Shares as
to which the Restrictions have not yet been removed pursuant to Section 3; (ii) such additional stock shall enjoy the privileges and be
subject to the Restrictions applicable to the Shares; and (iii) the Employee shall be entitled to sell, transfer, assign, pledge or otherwise
dispose of such additional stock when the Restrictions on the Shares to which the distribution relates have been removed pursuant to
Section 3.
3. Restrictions on Transfer of Shares; Termination of Employment; Death, or Disability.
(a) The Employee shall not have the right to sell, transfer, assign, pledge or otherwise dispose of the Shares,
except that such Restrictions shall be removed on the third anniversary of the date of this Agreement; provided that the
removal of the Restrictions on such anniversary date shall occur if and only if the Employee is on such date an employee of
the Corporation or one of its subsidiaries. Restrictions on the Shares shall also be removed to the extent provided under the
Plan in the event of a Change of Control of the Corporation. Removal of the Restrictions shall be accomplished by means of
a letter of instructions to the Registrar, signed by a senior executive of the Corporation, specifying that the Restrictions on the
Shares are to be removed, and instructing the Registrar to issue to the Employee a stock certificate representing the Shares,
registered in the name of the Employee or in such name or names as the Employee may request in writing (which request
shall be accompanied by payment of any stock transfer taxes that may be due as a result of such registration in such other
name or names). The Registrar shall debit the Employee's restricted stock account accordingly. The Corporation will take
any steps it deems necessary or desirable to satisfy its withholding tax obligation upon removal of the Restrictions; provided
that the Employee shall have the right (by delivering written notice to the Secretary of the Corporation no less than 30 days
nor more than 60 days prior to the date the Restrictions are to be removed) to have Shares withheld from the certificate to be
issued upon removal of the Restrictions or to tender other shares of Common Stock to meet such obligations. Following
removal of the Restrictions, the Employee shall be free to sell, transfer, assign, pledge or otherwise dispose of the Shares,
subject to applicable securities laws and the policies of the Corporation then in effect.
(b) Subject to the provisions of paragraphs (c), and (d) of this Section, upon termination of the Employee's
employment with the Corporation and any of its subsidiaries at a time when the Restrictions have not been removed, (i) the
Employee shall have no rights whatsoever in and to any of the Shares; (ii) all the Shares shall revert to the Corporation;
(iii) neither the Employee nor any of his or her heirs, beneficiaries, executors, administrators or other personal representatives
shall have any rights with respect thereto; and (iv) the Corporation shall repurchase the Shares at the lower of (A) the amount
the Employee paid for the Shares pursuant to Section 1 and (B) an amount equal to the number of Shares multiplied by the
average of the closing prices of a share of Common Stock on the New York Stock Exchange over the ten most recent trading
days preceding the date of termination of employment.
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