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                                                                    EXHIBIT 10.1

                         THE NEIMAN MARCUS GROUP, INC.

                              1997 INCENTIVE PLAN

1.  DEFINED TERMS

     Appendix A, which is incorporated by reference, defines the terms used in
the Plan.

2.  IN GENERAL

     The Plan has been established to advance the interests of the Company by
giving selected Employees, directors and other persons (including both
individuals and entities) who provide services to the Company or its Affiliates
equity-based or cash incentives through the grant of Awards. No Award may be
granted under the Plan after September 1, 2006, but Awards previously granted
may extend beyond that date.

3.  ADMINISTRATION

     The Administrator has discretionary authority, subject only to the express
provisions of the Plan, to interpret the Plan; determine eligibility for and
grant Awards; determine, modify or waive the terms and conditions of any Award;
prescribe forms, rules and procedures (which it may modify or waive); and
otherwise do all things necessary to carry out the purposes of the Plan. Once an
Award has been communicated in writing to a Participant, the Administrator may
not, without the Participant's consent, alter the terms of the Award so as to
affect adversely the Participant's rights under the Award, unless the
Administrator expressly reserved the right to do so. In the case of any Award
intended to be eligible for the performance-based compensation exception under
Section 162(m)(4)(C) of the Code, the Committee shall exercise its discretion
consistent with qualifying the Award for such exception.

4.  SHARES SUBJECT TO THE PLAN

     A.  A total of 4,900,000 shares of Stock have been reserved for issuance
under the Plan. The following shares of Stock will also be available for future
grants:

        (i) shares remaining under an Award that terminates without having been
            exercised in full (in the case of an Award requiring exercise by a
            Participant for delivery of Stock);

        (ii) shares subject to an Award, where cash is delivered to a
             Participant in lieu of such shares;

        (iii) shares of Restricted Stock that are forfeited to the Company;

        (iv) shares of Stock tendered by a Participant as payment upon exercise
             of an Award; and

        (v) shares of Stock held back by the Administrator, or tendered by a
            Participant, in satisfaction of tax withholding requirements.

Stock delivered under the Plan may be authorized but unissued Stock or
previously issued Stock acquired by the Company and held in treasury. No
fractional shares of Stock will be delivered under the Plan.

     B.  The maximum number of shares for which Stock Options may be granted to
any person over the life of the Plan shall be 1,000,000. The maximum number of
shares subject to SARs granted to any person over the life of the Plan shall
likewise be 1,000,000. For purposes of the preceding two sentences, the
repricing of a Stock Option or SAR shall be treated as a new grant to the extent
required

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under Section 162(m) of the Code. The aggregate maximum number of shares of
Stock delivered to any person over the life of the Plan pursuant to Awards that
are not Stock Options or SARs shall also be 1,000,000. Subject to these
limitations, each person eligible to participate in the Plan shall be eligible
in any year to receive Awards covering up to the full number of shares then
available for Awards under the Plan.

5.  ELIGIBILITY AND PARTICIPATION

     The Administrator will select Participants from among those key Employees,
directors and other individuals or entities providing services to the Company or
its Affiliates who, in the opinion of the Administrator, are in a position to
make a significant contribution to the success of the Company and its
Affiliates. Eligibility for ISOs is further limited to those individuals whose
employment status would qualify them for the tax treatment described in Sections
421 and 422 of the Code.

6.  RULES APPLICABLE TO AWARDS

     a.  ALL AWARDS

        (1)  Performance Objectives.  Where rights under an Award depend in
whole or in part on attainment of performance objectives, actions by the Company
that have an effect, however material, on such performance objectives or on the
likelihood that they will be achieved will not be deemed an amendment or
alteration of the Award unless accomplished by a change in the express terms of
the Award or other action that is without substantial consequence except as it
affects the Award.

        (2)  Alternative Settlement.  The Company retains the right at any time
to extinguish rights under an Award in exchange for payment in cash, Stock
(subject to the limitations of Section 4) or other property on such terms as the
Administrator determines, provided the holder of the Award consents to such
exchange.

        (3)  Transferability Of Awards.  Except as the Administrator otherwise
expressly provides, Awards (other than an Award in the form of an outright
transfer of cash or Unrestricted Stock) may not be transferred other than by
will or by the laws of descent and distribution and, during a Participant's
lifetime an Award requiring exercise may be exercised only by the Participant
(or in the event of the Participant's incapacity, the person or persons legally
appointed to act on the Participant's behalf).

        (4)  Vesting, Etc.  The Administrator may determine the time or times at
which an Award will vest (i.e., become free of restrictions) or become
exercisable. Unless the Administrator expressly provides otherwise, an Award
requiring exercise will cease to be exercisable, and all other Awards to the
extent not already fully vested will be forfeited, immediately upon the
cessation (for any reason, including death) of the Participant's employment or
other service relationship with the Company and its Affiliates.

        (5)  Taxes.  The Administrator will make such provision for the
withholding of taxes as it deems necessary. The Administrator may, but need not,
hold back shares from an Award or permit a Participant to tender previously
owned shares in satisfaction of tax withholding requirements.

        (6)  Dividend Equivalents, Etc.  The Administrator may provide for the
payment of amounts in lieu of dividends or other distributions with respect to
Stock subject to an Award.

        (7)  Rights Limited.  Nothing in the Plan shall be construed as giving
any person the right to continued employment or service with the Company or its
Affiliates, nor any rights as a shareholder except as to shares actually issued
under the Plan. The loss of existing or potential profit in Awards will not
constitute an element of damages in the event of termination of employment or
service for any

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reason, even if the termination is in violation of an obligation of the Company
or Affiliate to the Participant.

        (8)  Section 162(m).  In the case of an Award intended to be eligible
for the performance-based compensation exception under Section 162(m)(4)(C) of
the Code, the Plan and such Award shall be construed in a manner consistent with
qualifying the Award for such exception.

     b.  AWARDS REQUIRING EXERCISE

        (1)  Time And Manner Of Exercise.  Unless the Administrator expressly
provides otherwise, (a) an Award requiring exercise by the holder will not be
deemed to have been exercised until the Administrator receives a written notice
of exercise (in form acceptable to the Administrator) signed by the appropriate
person and accompanied by any payment required under the Award; and (b) if the
Award is exercised by any person other than the Participant, the Administrator
may require satisfactory evidence that the person exercising the Award has the
right to do so.

        (2)  Payment Of Exercise Price, If Any.  Where the exercise of an Award
is to be accompanied by payment, the Administrator may determine the required or
permitted forms of payment either at or after the time of the Award, subject to
the following: (a) unless the Administrator expressly provides otherwise, all
payments will be by cash or check acceptable to the Administrator; and (b) where
shares issued under an Award are part of an original issue of shares, the Award
shall require an exercise price equal to at least the par value of such shares.

        (3)  Reload Awards.  The Administrator may provide that upon the
exercise of an Award through the tender of previously owned shares of Stock, the
Participant or other person exercising the Award will automatically receive a
new Award of like kind covering a number of shares determined by reference to
the number of shares tendered in payment of the exercise price of the first
Award.

     c.  AWARDS NOT REQUIRING EXERCISE

     Awards of Restricted Stock and Unrestricted Stock may be made in return for
either (i) services determined by the Administrator to have a value not less
than the par value of the awarded shares, or (ii) cash or other property having
a value not less than the par value of the awarded shares plus such additional
amounts (if any) as the Administrator may determine payable in such combination
of cash, other property (of any kind) or services as the Administrator may
determine.

7.  EFFECT OF CERTAIN TRANSACTIONS

     a.  MERGERS, ETC.

     In the event of a consolidation or merger in which the Company is not the
surviving corporation or which results in the acquisition of substantially all
the Company's outstanding Stock by a single person or entity or by a group of
persons and/or entities acting in concert, or in the event of the sale or
transfer of substantially all the Company's assets or a dissolution or
liquidation of the Company (a "covered transaction"), all outstanding Awards
requiring exercise will cease to be exercisable, and all other Awards to the
extent not fully vested (including Awards subject to performance conditions not
yet satisfied or determined) will be forfeited, as of the effective time of the
covered transaction. Prior to such time the Administrator may (but need not)
accelerate the vesting or exercisability of any Award or provide for substitute
or replacement awards from the acquiring entity (if any).

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     b.  CHANGES IN AND DISTRIBUTIONS WITH RESPECT TO THE STOCK

        (1)  Basic Antidilution Provisions.  In the event of a stock dividend,
stock split or combination of shares, recapitalization or other change in the
Company's capital structure, the Administrator will make appropriate adjustments
to the maximum number of shares that may be delivered under the Plan under
Section 4.a. and to the maximum share limits described in Section 4.b., and will
also make appropriate adjustments to the number and kind of shares of stock or
securities subject to Awards then outstanding or subsequently granted, any
exercise prices relating to Awards and any other provision of Awards affected by
such change.

        (2)  Certain Other Adjustments.  The Administrator may also make
adjustments of the type described in paragraph (1) above to take into account
distributions to common stockholders other than stock dividends or normal cash
dividends, mergers, consolidations, acquisitions, dispositions or similar
corporate transactions, or any other event, if the Administrator determines that
adjustments are appropriate to avoid distortion in the operation of the Plan and
to preserve the value of Awards made hereunder; provided, that no such
adjustment shall be made to the maximum share limits described in Section 4.b.,
or otherwise to an Award intended to be eligible for the performance-based
exception under Section 162(m)(4)(C) of the Code, except to the extent
consistent with that exception.

     c.  CHANGE OF CONTROL

     Notwithstanding anything to the contrary in this Plan and unless
specifically provided otherwise in the Award Agreement at the time an Award is
granted, upon any Change of Control of the Company, any time periods, conditions
or contingencies relating to the exercise or realization of, or lapse of
restrictions under, any Award shall be automatically accelerated or waived so
that the Award may be exercised or realized in full; provided that, in the event
of a Change of Control that is intended to qualify for pooling of interests
accounting, the foregoing provisions of this paragraph shall be of no force and
effect if implementation of such provisions would preclude the Change of Control
from so qualifying and, in such event, the Committee shall take whatever action
it deems appropriate to enable holders of Awards to realize a substantially
similar economic result as would have been realized by acceleration of Awards
but without precluding the Change of Control from qualifying as a pooling of
interests.

A Change of Control will occur for purposes of this Plan:

    (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
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.

8.  CONDITIONS ON DELIVERY OF STOCK

     The Company will not be obligated to deliver any shares of Stock pursuant
to the Plan or to remove any restriction from shares previously delivered under
the Plan until: the Company's counsel has approved all legal matters in
connection with the issuance and delivery of such shares; if the outstanding
Stock is at the time listed on any stock exchange or national market system, the
shares to be delivered have been listed or authorized to be listed on such
exchange or system upon official notice of notice of issuance; and all
conditions of the Award have been satisfied or waived. If the sale of Stock has
not been registered under the Securities Act of 1933, as amended, the Company
may require, as a condition to exercise of the Award, such representations or
agreements as counsel for the Company may consider appropriate to avoid
violation of such Act. The Company may require that certificates evidencing
Stock issued under the Plan bear an appropriate legend reflecting any
restriction on transfer applicable to such Stock.



9.  AMENDMENT AND TERMINATION

     Subject to the last sentence of Section 3, the Administrator may at any
time or times amend the Plan or any outstanding Award for any purpose which may
at the time be permitted by law, or may at any time terminate the Plan as to any
further grants of Awards, provided that (except to the extent expressly required
or permitted by the Plan) no such amendment will, without the approval of the
stockholders of the Company, effectuate a change for which stockholder approval
is required in order for the Plan to continue to qualify under Section 422 of
the Code or for Awards to be eligible for the performance-based exception under
Section 162(m)(4)(C) of the Code.

10.  NON-LIMITATION OF THE COMPANY'S RIGHTS

     The existence of the Plan or the grant of any Award shall not in any way
affect the Company's right to award a person bonuses or other compensation in
addition to Awards under the Plan.

11.  GOVERNING LAW

     The Plan shall be construed in accordance with the laws of The Commonwealth
of Massachusetts.

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                                   APPENDIX A

                              DEFINITION OF TERMS

     The following terms, when used in the Plan, shall have the meanings and be
subject to the provisions set forth below:

     "Administrator":  The Committee, if one has been appointed; otherwise the
Board.

     "Affiliate":  Any corporation or other entity owning, directly or
indirectly, 50% or more of the outstanding Stock of the Company, or in which the
Company or any such corporation or other entity owns, directly or indirectly,
50% of the outstanding capital stock (determined by aggregate voting rights) or
other voting interests.

     "Award":  Any of the following:

          (i)  Options ("Stock Options") entitling the recipient to acquire
     shares of Stock upon payment of the exercise price. Each Stock Option
     (except as otherwise expressly provided by the Committee consistent with
     continued qualification of the Stock Option as a performance-based award
     for purposes of Section 162(m) of the Code, or unless the Committee
     expressly determines that such Stock Option is not subject to Section
     162(m) of the Code or that the Stock Option is not intended to qualify for
     the performance-based exception under Section 162(m) of the Code), will
     have an exercise price not less than the fair market value of the Stock
     subject to the option, determined as of the date of grant, except that an
     ISO granted to an Employee described in Section 422(b)(6) of the Code will
     have an exercise price not less than 110% of such fair market value. The
     Administrator will determine the medium in which the exercise price is to
     be paid, the duration of the option, the time or times at which an option
     will become exercisable, provisions for continuation (if any) of option
     rights following termination of the Participant's employment with the
     Company and its Affiliates, and all other terms of the Option. No Stock
     Option awarded under the Plan will be an ISO unless the Administrator
     expressly provides for ISO treatment.

          (ii)  Rights ("SARs") entitling the holder upon exercise to receive
     cash or Stock, as the Administrator determines, equal to a function
     (determined by the Administrator using such factors as it deems
     appropriate) of the amount by which the Stock has appreciated in value
     since the date of the Award.

          (iii)  Stock subject to restrictions ("Restricted Stock") under the
     Plan requiring that the Stock be redelivered to the Company if specified
     conditions are not satisfied. The conditions to be satisfied in connection
     with any Award of Restricted Stock, the terms on which such Stock must be
     redelivered to the Company, the purchase price of such Stock, and all other
     terms shall be determined by the Administrator.

          (iv)  Stock not subject to any restrictions under the Plan
     ("Unrestricted Stock").

          (v)  A promise to deliver Stock or other securities in the future on
     such terms and conditions as the Administrator determines.

          (vi)  Securities (other than Stock Options) that are convertible into
     or exchangeable for Stock on such terms and conditions as the Administrator
     determines.

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          (vii)  Cash bonuses tied to performance criteria as described at
     (viii) below ("Cash Performance Awards").

          (viii)  Awards described in any of (i) through (vii) above where the
     right to exercisability, vesting or full enjoyment of the Award is
     conditioned in whole or in part on the satisfaction of specified
     performance criteria ("Performance Awards"). The Committee in its
     discretion may grant Performance Awards that are intended to qualify for
     the performance-based compensation exception under Section 162(m)(4)(C) of
     the Code and Performance Awards that are not intended so to qualify. No
     more than $2,000,000 may be paid to any individual with respect to any Cash
     Performance Award. In applying the limitation of the preceding sentence:
     (A) multiple Cash Performance Awards to the same individual that are
     determined by reference to performance periods of one year or less ending
     with or within the same fiscal year of the Company shall be subject in the
     aggregate to one $2,000,000 limit, and (B) multiple Cash Performance Awards
     to the same individual that are determined by reference to one or more
     multi-year performance periods ending in the same fiscal year of the
     Company shall be subject in the aggregate to a separate limit of
     $2,000,000. With respect to any Performance Award other than a Cash
     Performance Award, Stock Option or SAR, the maximum award opportunity shall
     be 1,000,000 shares or their equivalent value in cash, subject to the
     limitations of Section 4.b. For the avoidance of doubt, any Performance
     Award of a type described in (i) through (vi) above shall be treated for
     purposes of this paragraph as a Performance Award that is not a Cash
     Performance Award, even if payment is made in cash.

          In the case of a Performance Award intended to qualify as
     performance-based for the purposes of Section 162(m) of the Code, the
     Committee shall in writing preestablish a specific performance goal (based
     solely on one or more qualified performance criteria) no later than 90 days
     after the commencement of the period of service to which the performance
     relates (or at such earlier time as is required to qualify the award as
     performance-based under Code Section 162(m)(4)(C)). For purposes of the
     Plan, a qualified performance criterion is any of the following: (1)
     earnings or earnings per share (whether on a pre-tax, after-tax,
     operational or other basis), (2) return on equity, (3) return on assets,
     (4) revenues, (5) sales, (6) expenses, (7) one or more operating ratios,
     (8) stock price, (9) stockholder return, (10) market share, (11) cash flow,
     (12) inventory levels or inventory turn, (13) capital expenditures, (14)
     net borrowing, debt leverage levels or credit quality, (15) the
     accomplishment of mergers, acquisitions, dispositions, public offerings or
     similar extraordinary business transactions or (16) any combination of the
     foregoing. The performance goals selected in any case need not be
     applicable across the Company, but may be particular to an individual's
     function or business unit. Prior to payment of any Performance Award
     intended to qualify as performance-based under Section 162(m)(4)(C) of the
     Code, the Committee shall certify whether the performance goal has been
     attained and such determination shall be final and conclusive. If the
     performance goal is not attained, no other Award shall be provided in
     substitution of the Performance Award.

          (ix)  Grants of cash, or loans, made in connection with other Awards
     in order to help defray in whole or in part the economic cost (including
     tax cost) of the Award to the Participant. The terms of any such grant or
     loan shall be determined by the Administrator.

Awards may be combined in the Administrator's discretion.

     "Board":  The Board of Directors of the Company.

     "Code":  The U.S. Internal Revenue Code of 1986, as from time to time
amended and in effect.

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     "Committee":  A committee of the Board comprised solely of two or more
outside directors within the meaning of Section 162(m) of the Code. The
Committee may delegate ministerial tasks to such persons (including Employees)
as it deems appropriate.

     "Company":  The Neiman Marcus Group, Inc.

     "Employee":  Any person who is employed by the Company or an Affiliate.

     "ISO":  A Stock Option intended to be an "incentive stock option" within
the meaning of Section 422 of the Code.

     "Participant":  An Employee, director or other person providing services to
the Company or its Affiliates who is granted an Award under the Plan.

     "Plan":  The Neiman Marcus Group, Inc. 1997 Incentive Plan as from time to
time amended and in effect.

     "Stock":  Common Stock of the Company, par value $.01 per share.

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