Neiman Marcus 2011 Annual Report Download - page 140

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6. Expiration Date. Subject to the provisions of the Plan and Section 5(c) above, the exercisable portion of the Option will remain exercisable
until, and shall expire on, the earlier of: (i) one year after a Change of Control; or (ii) October 6, 2015.
7. Net-Physical Settlement. In the event that a Participant’s Employment terminates due to death, Disability or Retirement or is terminated by
the Company without Cause or by the Participant for Good Reason, the Company will permit such Participant to exercise all or any portion of his or her
outstanding Option, which is then vested and then exercisable or thereafter becomes exercisable, through net-physical settlement (to satisfy both the exercise
price and applicable withholding taxes (at the minimum statutory withholding rate)), to the extent permitted under Section 409A of the Code; provided that the
Company’s Chief Financial Officer makes a good faith determination at such time and after reasonable efforts to consult with the Company’s independent
auditors that net-physical settlement of any such Option would not produce materially less favorable accounting consequences for the Company than if the
exercise price for any such Option were paid in cash. The partial exercise of the Option, alone, shall not cause the expiration, termination or cancellation of the
remaining Option.
8. Construction of Agreement. Any provision of this Agreement (or portion thereof) which is deemed invalid, illegal or unenforceable in any
jurisdiction shall, as to that jurisdiction and subject to this section, be ineffective to the extent of such invalidity, illegality or unenforceability, without
affecting in any way the remaining provisions thereof in such jurisdiction or rendering that or any other provisions of this Agreement invalid, illegal, or
unenforceable in any other jurisdiction. If any covenant should be deemed invalid, illegal or unenforceable because its scope is considered excessive, such
covenant shall be modified so that the scope of the covenant is reduced only to the minimum extent necessary to render the modified covenant valid, legal and
enforceable. No waiver of any provision or violation of this Agreement by the Company shall be implied by the Company’s forbearance or failure to take
action. It is intended that the Option be exempt from Code Section 409A, and this Agreement shall be administered and construed to the fullest extent possible
to reflect and implement such intent.
9. Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any party hereto upon any breach or
default of any party under this Agreement, shall impair any such right, power or remedy of such party nor shall it be construed to be a waiver of, or
acquiescence in, any such breach or default, or any similar breach or default thereafter occurring nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the
part of any party of any breach or default under this Agreement, or any waiver on the part of any party or any provisions or conditions of this Agreement,
shall be in writing and shall be effective only to the extent specifically set forth in such writing.
10. Limitation on Transfer. The Option shall be exercisable only by the Participant or the Participant’s Permitted Transferee(s), as determined
in accordance with the terms of the Plan, except that the Participant is not required to obtain the prior written approval by the Board of any proposed Transfer
to a Permitted Transferee during the lifetime of the Participant. Each Permitted Transferee shall be subject to all the restrictions, obligations, and
responsibilities as apply to the Participant under the Plan and this Agreement and shall be entitled to all the rights of the Participant under the Plan and this
Agreement. All shares of Common Stock obtained pursuant to the Option granted herein shall not be transferred except as provided in the Plan and, where
applicable, the Management Stockholders’ Agreement.
11. Conflicts: Interpretation of the Plan Provisions . The terms of this Agreement shall govern pari passu with the terms of the Plan, and the
parties hereby agree to work together to resolve any inconsistency between the terms of the Plan and the terms of this Agreement. Notwithstanding anything
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