Employment Agreement [Amended and Restated] (2015)Full Document 

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EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (this "Agreement"), effective as of the Effective Date, is by and among James E. Skinner (the "Executive") and The Neiman Marcus Group LLC, a Delaware limited liability company (formerly The Neiman Marcus Group, Inc. and referred to as "NMG").

RECITALS

WHEREAS, Executive is currently employed as Executive Vice President, Chief Operating Officer, and Chief Financial Officer by NMG and Parent pursuant to an employment agreement with NMG, dated October 25, 2013 (the "Prior Agreement");

WHEREAS, pursuant to Section 24 of the Prior Agreement, the Prior Agreement may be amended by a writing signed by the parties to the Prior Agreement;

WHEREAS, the parties desire that Executive become employed by NMG and serve as a Vice Chairman of NMG and Parent; and

WHEREAS, the parties desire to amend and restate the Prior Agreement in its entirety by entering into this Agreement, subject to the terms and provisions herein contained.

AGREEMENT

1.                                    Definitions.  As used in this Agreement, the following terms have the following meanings:

(a)                               "Affiliate" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, such Person.  As of the Effective Date, NMG and Parent are "Affiliates" of one another.

(b)                              "Cause" means one or more of the following: (i) the Executive’s willful and material failure to substantially perform his duties (other than as a result of physical or mental illness or injury), or other material breach of this Agreement by the Executive; (ii) the Executive’s (A) willful misconduct or (B) gross negligence, in each case which is materially injurious to NMG or any of its Affiliates; (iii) the Executive’s willful breach of his fiduciary duty or duty of loyalty to NMG or any of its Affiliates; or (iv) the commission by the Executive of any felony or other serious crime involving moral turpitude.  For purposes of the foregoing, no act or failure to act shall be treated as "willful" unless done, or omitted to be done, by the Executive not in good faith and without the reasonable belief that the Executive’s action or omission was in the best interest of NMG.

(c)                               "Code" means the Internal Revenue Code of 1986, as amended.

(d)                             "Competitor" means (i) the retail operations of any Person who, at any time during the Executive’s employment with NMG was a vendor of NMG or any of its Affiliates and



who during any consecutive 12-month period during the five years immediately preceding the Executive’s termination of employment with NMG had annual gross sales to NMG and its Affiliates in the aggregate of $150 million or more at retail; (ii) any Person (other than NMG or an Affiliate of NMG) that owns or operates a luxury specialty retail store in the New York, New York metropolitan area; (iii) Saks Incorporated, Nordstrom, Inc., Barneys New York, Inc., Macy’s, Inc., Hudson’s Bay Company, Amazon.com, Inc., Net-a-Porter LLC, Gilt Groupe, Inc. or, if those corporate names are not correct, the businesses commonly referred to as "Saks," "Nordstrom’s," "Barneys," "Bloomingdales," "Lord and Taylor," "Amazon," "Net-a-Porter," and "Gilt" or any of their respective parent companies, as applicable; and (iv) the Affiliates of, successors to and assigns of the Persons described in (i) and (iii).

(e)                               "Confidential Information" means all confidential or proprietary information of NMG, Parent and their respective Affiliates, including (without limitation) all documents or information, in whatever form or medium, concerning or evidencing sales; costs; pricing; strategies; forecasts and long range plans; financial and tax information; personnel information; business, marketing and operational projections, plans and opportunities; and customer, vendor, and supplier information; but excluding any such information that is or becomes generally available to the public other than as a result of any breach of this Agreement or other unauthorized disclosure by the Executive.

(f)                                "Effective Date" means June 15, 2015.

(g)                              "Employment Termination Date" means the effective date of termination of the Executive’s employment as established under Paragraph 6(e).

(h)                              "Parent" means Neiman Marcus Group, Inc.

(i)                                  "Parent Board" means the Board of Directors of Parent, or any successor governing body of Parent or its successors.

(j)                                  "Person" means any individual, corporation, partnership, sole proprietorship, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company, government or other entity.

(k)                              "Target Bonus" means the target bonus under NMG’s annual incentive bonus program(s).

(l)                                  "Work Product" means all ideas, works of authorship, inventions and other creations, whether or not patentable, copyrightable, or subject to other intellectual-property protection, that are made, conceived, developed or worked on in whole or in part by the Executive while employed by NMG or any of its Affiliates, that relate in any manner whatsoever to the business, existing, proposed or advisable, of NMG or any of its Affiliates, or any other business or research or development effort in which NMG or any of its Affiliates engages during the Executive’s employment.  Work Product includes any material previously conceived, made, developed or worked on during the Executive’s employment with NMG or any of its Affiliates prior to the Effective Date.

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2.                                    Employment; Prior Agreements.  NMG agrees to continue to employ the Executive, and the Executive agrees to continue to be employed, for the period set forth in Paragraph 3, in the position and with the duties and responsibilities set forth in Paragraph 4, and upon the other terms and conditions set out in this Agreement.  The employment agreement entered into by and among the Executive, NMG and Neiman Marcus Group LTD Inc., effective October 6, 2010 was superseded and replaced in its entirety by the Prior Agreement.  The Prior Agreement is hereby superseded effective as of the Effective Date and replaced in its entirety by this Agreement without further right or obligation thereunder on the part of either party thereto.  The replacement of the Prior Agreement with this Agreement does not cause any right or obligation under the Prior Agreement to arise.

3.                                    Term.  Unless sooner terminated as provided in this Agreement, the term of the Agreement shall commence on the Effective Date and extend until February 1, 2016 (the "Employment Term"). Unless an extension of the Employment Term is agreed upon by the Executive and the Company, the Executive’s employment will end upon the expiration of the Employment Term.

4.                                    Position and Duties.

(a)                               The Executive shall serve as a Vice Chairman of NMG and Parent.  In such capacities, the Executive shall report to the Chief Executive Officer of NMG and Parent (the "CEO").

(b)                              During the Employment Term, the Executive shall devote his full time, skill, and attention and his best efforts to the business and affairs of NMG to the extent necessary to discharge fully, faithfully, and efficiently the duties and responsibilities delegated and assigned to the Executive in or pursuant to this Agreement, except for usual, ordinary, and customary periods of vacation and absence due to illness or other disability.  Notwithstanding the foregoing, the Executive may (i) serve as a director or as a member of one board of directors of one noncompeting company, (ii) subject to the prior written approval of the CEO and the Chairman of the Parent Board, serve as a director or as a member of two additional boards of directors of other noncompeting companies, (iii) serve as an officer or director or otherwise participate in non-profit educational, welfare, social, religious, professional, and civic organizations, including, without limitation, all such positions and participation in effect as of the Effective Date, and (iv) manage personal and family investments; provided, however, that any such activities as described in (i), (ii) (iii) or (iv) of the preceding provisions of this Paragraph 4(b) do not materially interfere with the performance and fulfillment of the Executive’s duties and responsibilities in accordance with this Agreement.

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