EXHIBIT 10.13
TERMINATION AND CHANGE OF CONTROL AGREEMENT
1. This Termination and Change of Control Agreement ("Agreement") is entered
into as of May 22, 2000 between Xxxxx X. Xxxx ("Xx. Xxxx" or the
"Executive") and The Neiman Marcus Group, Inc. ("NMG").
2. Xx. Xxxx is employed "at-will" as President and Chief Executive Officer
of NM Direct, and Xx. Xxxx or NMG may terminate Xx. Xxxx'x employment at any
time, with or without notice, for any reason. Notwithstanding this at-will
employment, NMG wishes to provide some protection to Xx. Xxxx if the
Executive's employment ends under certain circumstances.
3. a. While Xx. Xxxx is employed at-will, if NMG terminates Xx. Xxxx'x
employment other than "for cause" or other than due to "total disability"
or death, NMG agrees to provide Xx. Xxxx with a termination package
consisting of (a) an amount equivalent to 1.5 times her then-current
annual base salary, less required withholding, which amount would be paid
over an 18-month period in regular, bi-weekly installments following such
termination; and (b) continuation of the medical and dental insurance
coverage in which she participates at the time of such termination (or
as such coverage may be changed from time-to-time for employees
generally) for 18 months or until she starts full-time employment,
whichever is sooner. Xx. Xxxx will be responsible for paying her portion
of monthly premiums for the medical and dental insurance coverage at the
same rate paid by active employees, and Xx. Xxxx authorizes NMG to deduct
such amounts from the payments it makes to her. For the purposes of
determining whether or not NMG has terminated the Executive's employment,
any material, adverse change in the terms and conditions of her
employment, which change causes the Executive to resign her employment,
will be deemed a termination.
b. If Xx. Xxxx'x services are terminated by a successor to NMG other
than "for cause" or other than due to "total disability" or death within
two years of a change of control of NMG, as a change of control is
defined in Appendix A, or if the Executive resigns her employment within
two years of such a change of control because she is not permitted to
continue in a position comparable in duties and responsibilities to that
which she held before such a change of control, Xx. Xxxx shall receive
the termination package set forth in paragraph 3.a.
4. For the purposes of determining Xx. Xxxx'x eligibility for the
termination package set forth in this Agreement:
a. "For cause" means, in NMG's reasonable judgment, a breach of
duty by Xx. Xxxx in the course of her employment involving fraud, acts
of dishonesty (other than inadvertent acts or omissions), or moral
turpitude, repeated insubordination, failure to devote her full
working time and best efforts to the performance of her duties, or
conviction of a felony or other serious criminal offense. Provided
that, with respect to insubordination or devotion of her working time,
Xx. Xxxx has been provided prior written notice of the problem and
afforded a reasonable opportunity to correct same
b. "Total Disability" means that, in NMG's reasonable judgment, Xx.
Xxxx is unable to perform her duties for (a) 80% or more of the normal
working days during six consecutive calendar months or (b) 50% or more
of the normal working days during twelve consecutive calendar months.
c. "Change of control" has the meaning set forth in Appendix A.
5. Payment by NMG of the termination package set forth in paragraph 3
constitutes full satisfaction of NMG's obligations to Xx. Xxxx, if any,
(including the right to any severance payments) which arise from or relate in
any way to the termination of Xx. Xxxx'x employment. However, nothing in this
Agreement is intended to limit any earned, vested benefits (other than any
entitlement to severance pay) that Xx. Xxxx may have under the applicable
provisions of any benefit plan in which Xx. Xxxx is participating at the time
of her termination of employment or resignation.
6. The unenforceability of any provision of this Agreement shall not affect
the enforceability of any other provision of this Agreement.
7. This Agreement contains the entire agreement between the parties and
supersedes all prior agreements and understandings, oral or written, with
respect to the termination of Xx. Xxxx'x at-will employment and the subject
matter of the Agreement. This Agreement may not be changed orally. It may be
changed only by written agreement signed by the party against whom any waiver,
change amendment, modification or discharge is sought.
8. The validity, performance and enforceability of this Agreement will be
determined and governed by the laws of the Massachusetts without regard to
its conflict of laws principles.
The Neiman Marcus Group, Inc.
/s/ Xxxxx Xxxx By: /s/Xxxxxx X. Xxxxxx
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Ms. Xxxxx Xxxx Xxxxxx X. Tanksy
Appendix A
A Change of Control will occur for purposes of this Agreement:
(i) upon the consummation of any transaction or series of transactions
under which the Company is merged or consolidated with any other company, other
than a merger or consolidation which would result in the shareholders of the
Company immediately prior thereto continuing to own (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 50% of the combined voting power of the voting securities of
the Company, the acquiring entity or such surviving entity outstanding
immediately after such merger or consolidation in substantially the same
proportion such shareholders held the voting securities of the company
immediately prior to the merger or consolidation;
(ii) if any person or group (as used in section 13(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) (other than the Company,
any trustee or other fiduciary holding securities under an employee benefit
plan of the Company, or any company owned, directly or indirectly, by the
shareholders of the Company in substantially the same proportions as their
ownership of stock of the Company) becomes the "beneficial owner" (as defined
in Rule 13d-3 under the Exchange Act) of securities of the Company representing
more than 40% of (a) the shares of the Company's Class B Common Stock then
outstanding or (b) the total voting power (other than in the election of
directors) of all securities of the Company then outstanding; or
(iii) if, during any period of twenty-four consecutive months,
individuals who at the beginning of such period constitute the Board of
Directors, and any new director whose election or nomination for election by
the Company's shareholders was approved by a vote of at least two-thirds (2/3)
of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason (other than death or disability)
to constitute at least a majority thereof; or
(iv) the complete liquidation of the Company or the sale or disposition
by the Company of all or substantially all of the Company's assets, other than
a liquidation of the Company into a wholly-owned subsidiary.
