Neiman Marcus 2004 Annual Report Download - page 129

ARTICLE II.
DISTRIBUTION AND OTHER TRANSACTIONS;
CERTAIN COVENANTS
SECTION 2.1 The Distribution and Other Transactions.
(a) The Distribution. Subject to the conditions set forth in Section 2.1(b) of this Agreement, on the Declaration Date the Board of Directors of
Harcourt General shall declare the Distribution upon the terms set forth in this Agreement. To effect the Distribution, Harcourt General shall cause the
Distribution Agent to distribute, on the Distribution Date, on a pro rata basis and taking into account Section 2.1(c), to the holders of record of Harcourt
General Common Stock on the Distribution Record Date, all shares of Class B Common Stock held by Harcourt General on the Distribution Date.
During the period commencing on the date the certificates representing shares of Class B Common Stock are delivered to the Distribution Agent and
ending upon the date(s) on which certificates evidencing such shares are mailed to holders of record of Harcourt General Common Stock on the
Distribution Record Date or on which fractional shares of Class B Common Stock are sold on behalf of such holders, the Distribution Agent shall hold
the certificates representing shares of Class B Common Stock on behalf of such holders. Harcourt General shall deliver to the Distribution Agent the
share certificates representing the shares of Class B Common Stock held by Harcourt General which are to be distributed to the holders of Harcourt
General Common Stock in the Distribution. Neiman Marcus agrees, if required by Harcourt General, to provide all certificates evidencing shares of
Class B Common Stock that Harcourt General shall require in order to effect the Distribution.
(b) Conditions to the Distribution. The Harcourt General Board of Directors shall declare a dividend constituting the Distribution on the
Declaration Date following the satisfaction or waiver by Harcourt General, as determined by Harcourt General in its sole discretion, of the conditions set
forth below:
(i) A private letter ruling from the Internal Revenue Service shall have been obtained, and shall continue in effect, providing that, among
other things, the Recapitalization and the Distribution will qualify as tax-free transactions for federal income tax purposes under Sections 354 and
355 of the Code (the "IRS Ruling"); such ruling shall be in form and substance satisfactory to Harcourt General in its sole discretion; and Harcourt
General and Neiman Marcus shall have complied with all conditions set forth in such ruling that are required to be complied with prior to the
Distribution;
(ii) Any material governmental approvals and consents necessary to consummate the Distribution and the other transactions contemplated
hereby and by the Recapitalization Agreement shall have been obtained and shall be in full force and effect;
(iii) No order, injunction or decree issued by any court or agency of competent jurisdiction or other legal restraint or prohibition preventing
the consummation of the Distribution and the other transactions contemplated hereby and by the Recapitalization Agreement shall be in effect and
no other event outside the control of Harcourt General shall have occurred or failed to occur that prevents the consummation of the Distribution;
(iv) The transactions contemplated hereby shall be in compliance with applicable federal and state securities and other applicable laws;
(v) Each of Neiman Marcus and Harcourt General shall have received such consents, and shall have received executed copies of such
agreements or amendments of agreements, as Harcourt General shall deem appropriate in connection with the completion of the
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