**Exhibit 10.33**

 

THE AMENDED ANDRESTATEDNEIMAN MARCUS GROUP, INC.DEFINED CONTRIBUTIONSUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

 

(Effective as of January 1,2008)

 

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| ARTICLE  I PURPOSE                                     |   | 1                                                  |
|--------------------------------------------------------|--------|----------------------------------------------------|
|                                                   |   |                                               |   |   |
| ARTICLE  II DEFINITIONS                                |   | 2                                                  |
|                                                   |   |                                               |   |   |
| Section 2-1                                       |   | “Affiliate”                              |   | 2 |
| Section 2-2                                       |   | “Amended  Enrollment Agreement”          |   | 2 |
| Section 2-3                                       |   | “Base  Pay”                              |   | 2 |
| Section 2-4                                       |   | “Beneficiary”                            |   | 2 |
| Section 2-5                                       |   | “Board”                                  |   | 2 |
| Section 2-6                                       |   | “Cause”                                  |   | 2 |
| Section 2-7                                       |   | “Change  of Control”                     |   | 2 |
| Section 2-8                                       |   | “Claimant”                               |   | 4 |
| Section 2-9                                       |   | “Code”                                   |   | 4 |
| Section 2-10                                      |   | “Committee”                              |   | 4 |
| Section 2-11                                      |   | “Company”                                |   | 4 |
| Section 2-12                                      |   | “Compensation  Limitation”               |   | 4 |
| Section 2-13                                      |   | “DB  SERP”                               |   | 4 |
| Section 2-14                                      |   | “Defined  Contribution”                  |   | 4 |
| Section 2-15                                      |   | “Defined  Contribution Account”          |   | 4 |
| Section 2-16                                      |   | “Disabled”                               |   | 4 |
| Section 2-17                                      |   | “Effective  Date”                        |   | 4 |
| Section 2-18                                      |   | “Eligible  Compensation”                 |   | 4 |
| Section 2-19                                      |   | “Eligible  Employee”                     |   | 6 |
| Section 2-20                                      |   | “Employee”                               |   | 6 |
| Section 2-21                                      |   | “Employer”                               |   | 6 |
| Section 2-22                                      |   | “Enrollment  Agreement”                  |   | 7 |
| Section 2-23                                      |   | “ERISA”                                  |   | 7 |
| Section 2-24                                      |   | “Exchange  Act”                          |   | 7 |
| Section 2-25                                      |   | “Hour  of Service”                       |   | 7 |
| Section 2-26                                      |   | “Identification  Date”                   |   | 7 |
| Section 2-27                                      |   | “Key  Employee”                          |   | 7 |
| Section 2-28                                      |   | “Non-Transitional  Defined Contribution” |   | 7 |
| Section 2-29                                      |   | “Participant”                            |   | 7 |
| Section 2-30                                      |   | “Plan”                                   |   | 7 |
| Section 2-31                                      |   | “Plan  Year”                             |   | 7 |
| Section 2-32                                      |   | “Separation  Date”                       |   | 7 |
| Section 2-33                                      |   | “Separation  From Service”               |   | 8 |
| Section 2-34                                      |   | “Specified  Distribution Date”           |   | 8 |
| Section 2-35                                      |   | “Specified  Employee”                    |   | 8 |
| Section 2-36                                      |   | “Transitional  Defined Contribution”     |   | 8 |
| Section 2-37                                      |   | “Year  of Service”                       |   | 8 |
|                                                   |   |                                               |   |   |
| ARTICLE  III ADMINISTRATION OF THE PLAN AND DISCRETION |   | 9                                                  |
|                                                   |   |                                               |
| Section 3-1                                       |   | Administration                                     |   | 9 |
| Section 3-2                                       |   | Compensation  of Committee; Expenses               |   | 9 |
| Section 3-3                                       |   | Indemnification                                    |   | 9 |
| Section 3-4                                       |   | Interpretations                                    |   | 9 |

 

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| ARTICLE  IV PARTICIPATION                 |   | 10                                                                                           |
|-------------------------------------------|--------|----------------------------------------------------------------------------------------------|
|                                      |   |                                                                                         |   |   |
| Section 4-1                          |   | Defined  Contributions                                                                       |   | 10 |
| Section 4-2                          |   | Time  of Distribution                                                                        |   | 11 |
| Section 4-3                          |   | Form of  Distribution                                                                   |   | 11 |
| Section 4-4                          |   | Modifications  of Distribution Timing                                                        |   | 11 |
| Section 4-5                          |   | Characterization  of Payments for 409A Purposes                                              |   | 11 |
| Section 4-6                          |   | Change  in Status                                                                            |   | 11 |
|                                      |   |                                                                                         |   |   |
| ARTICLE  V INVESTMENT CREDITS AND FUNDING |   | 13                                                                                           |
|                                      |   |                                                                                         |
| Section 5-1                          |   | Theoretical  Rate of Return                                                                  |   | 13 |
| Section 5-2                          |   | Notional  Investment Alternatives                                                            |   | 13 |
| Section 5-3                          |   | Changes  of Notional Investment Alternatives, if Applicable                                  |   | 13 |
| Section 5-4                          |   | Unfunded  Status                                                                             |   | 13 |
| Section 5-5                          |   | Valuation                                                                                    |   | 14 |
| Section 5-6                          |   | Defined  Contribution Account Statement                                                      |   | 14 |
|                                      |   |                                                                                         |   |   |
| ARTICLE  VI VESTING                       |   | 15                                                                                           |
|                                      |   |                                                                                         |
| ARTICLE  VII DISTRIBUTIONS                |   | 16                                                                                           |
|                                      |   |                                                                                         |
| Section 7-1                          |   | Distributions                                                                                |   | 16 |
| Section 7-2                          |   | Distributions  on Separation From Service for Participants WhoAre Deemed Specified Employees |   | 16 |
| Section 7-3                          |   | Death  of Participant                                                                        |   | 16 |
| Section 7-4                          |   | Disability  of Participant                                                                   |   | 16 |
| Section 7-5                          |   | Change  of Control                                                                           |   | 17 |
| Section 7-6                          |   | Change  in Time                                                                              |   | 17 |
|                                      |   |                                                                                         |   |   |
| ARTICLE  VIII AMENDMENT AND TERMINATION   |   | 18                                                                                           |
|                                      |   |                                                                                         |
| ARTICLE  IX CLAIMS PROCEDURES             |   | 19                                                                                           |
|                                      |   |                                                                                         |
| Section 9-1                          |   | Claim                                                                                        |   | 19 |
| Section 9-2                          |   | Claim  Decision                                                                              |   | 19 |
| Section 9-3                          |   | Request  for Review                                                                          |   | 19 |
| Section 9-4                          |   | Review  of Decision                                                                          |   | 19 |
|                                      |   |                                                                                         |   |   |
| ARTICLE  X MISCELLANEOUS                  |   | 20                                                                                           |
|                                      |   |                                                                                         |   |   |
| Section 10-1                         |   | Designation  of Beneficiary                                                                  |   | 20 |
| Section 10-2                         |   | Limitation  of Participant’s Right                                                      |   | 20 |
| Section 10-3                         |   | No  Limitation on Employer Actions                                                           |   | 20 |
| Section 10-4                         |   | Obligations  to the Employer                                                                 |   | 20 |
| Section 10-5                         |   | Non-alienation  of Benefits                                                                  |   | 20 |
| Section 10-6                         |   | Protective  Provisions                                                                       |   | 21 |
| Section 10-7                         |   | Withholding  Taxes                                                                           |   | 21 |
| Section 10-8                         |   | Unfunded  Status of Plan                                                                     |   | 21 |
| Section 10-9                         |   | Severability                                                                                 |   | 21 |
| Section 10-10                        |   | Governing  Law                                                                               |   | 21 |
| Section 10-11                        |   | Headings                                                                                     |   | 21 |
| Section 10-12                        |   | Gender,  Singular and Plural                                                                 |   | 21 |
| Section 10-13                        |   | Notice                                                                                       |   | 21 |

 

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| Section 10-14 |   | Missing  Participants |   | 21 |
|--------------------|--------|-----------------------|--------|----|
| Section 10-15 |   | Incapacity            |   | 21 |
| Section 10-16 |   | Section 409A     |   | 22 |

 

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THE NEIMAN MARCUS GROUP, INC.DEFINED CONTRIBUTIONSUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

 

ARTICLE IPURPOSE

 

TheNeiman Marcus Group, Inc. (the “Company”) adopted The Neiman Marcus Group, Inc.Defined Contribution Supplemental Executive Retirement Plan (the “Plan”),effective as of the Effective Date (such term, together with all othercapitalized terms set forth in this Plan having the meanings set forth inARTICLE II below), in recognition of the services provided by certain keymanagement employees or other highly compensated employees of the Company andits Affiliates. Subsequent to the adoption of the Plan, but also effective asof the Effective Date, the Plan was amended and restated to resolve minorscrivener’s errors and formatting issues that were discovered following theadoption of the Plan.

 

ThePlan is intended to provide Eligible Employees with the opportunity to receivedeemed contributions from the Company for a portion of their Compensation thatexceeds the limit on compensation under Section 401(a)(17)(A) of theCode, as adjusted pursuant to section 401(a)(17)(B) (the “CompensationLimitation”). The Company intends that the Plan shall at all times bemaintained on an unfunded basis for federal income tax purposes under the Codeand administered as a non-qualified “top-hat” plan exempt from the substantiverequirements of ERISA. The Company also intends that the Plan be operated and maintainedin accordance with the requirements of Section 409A of the Code and theregulations and rulings thereunder.

 

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ARTICLE IIDEFINITIONS

 

Forpurposes of this Plan, the following terms shall have the meanings indicated,unless the context clearly indicates otherwise:

 

Section 2-1                                     “Affiliate” means any corporation or organization thattogether with the Company is treated as a single employer under Section 414(b) or(c) of the Code.

 

Section 2-2                                     “AmendedEnrollment Agreement” means a newEnrollment Agreement executed by a Participant that satisfies the requirementsof Section 7-6 below and that changes the time and/or form of adistribution for a particular Plan Year.

 

Section 2-3                                     “BasePay” means the base salary payableby an Employer to an Employee, including amounts that would have been payableto the Employee as base salary but for an election under:

 

(a)                                  Section 125 of the Code

 

(b)                                 Section 401(k) of the Code,including catch-up contributions and Roth 401(k) contributions, if any, or

 

(c)                                  a deferral election under a nonqualifieddeferred compensation plan.

 

Section 2-4                                     “Beneficiary” means the person or persons (natural orotherwise) designated by the Participant as such in accordance with Section 10-1below.

 

Section 2-5                                     “Board” means the Board of Directors ofThe Neiman Marcus Group, Inc.

 

Section 2-6                                     “Cause”

 

(a)                                  The term “Cause” means:

 

(1)                                  the willful and continued failure by anEmployee to substantially perform duties consistent with the Employee’sposition with an Employer (other than any such failure resulting fromincapacity due to physical or mental illness), after a demand for substantialperformance is delivered to the Employee, and the Employee has failed to resumesubstantial performance of the Employee’s duties on a continuous basis withinfourteen (14) days of receiving such demand;

 

(2)                                  the willful engaging by an Employee in conductthat is demonstrably and materially injurious to an Employer, monetarily orotherwise; or

 

(3)                                  the Employee’s commission of a felony,commission of a misdemeanor involving assets of an Employer, or violation of anEmployer’s merchandise discount policy.

 

(b)                                 For purposes of this definition, no act, orfailure to act, on the Employee’s part shall be deemed “willful” unless done,or omitted to be done, by the Employee not in good faith and without reasonablebelief that the Employee’s action or omission was in the best interest of anEmployer.

 

Section 2-7                                     “Changeof Control”

 

(a)                                  The term “Change of Control” means the occurrence of any of the following events after theEffective Date:

 

(1)                                  any sale, lease, exchange or other transfer(in one transaction or a series of related transactions) of all orsubstantially all of the assets of the

 

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Companyon a consolidated basis to any Person or group of related persons for purposesof Section 13(d) of the Securities Exchange Act of 1934 (a “Group”),together with any CIC Affiliates thereof other than to a Majority Stockholder;

 

(2)                                  the approval by the holders of the outstandingvoting power of the Company of any plan or proposal for the liquidation ordissolution of the Company;

 

(3)                                  the occurrence of both of the following:

 

(A)                              any Person or Group (other than the MajorityStockholder) becoming the beneficial owner (within the meaning of Section 13(d) ofthe Exchange Act), directly or indirectly, of Common Stock representing morethan 40% of the aggregate outstanding voting power of the Company and suchPerson or Group actually having the power to vote such Common Stock in any suchelection, and

 

(B)                                the Majority Stockholder beneficially owning(within the meaning of Section 13(d) of the Securities Exchange Actof 1934), directly or indirectly, in the aggregate a lesser percentage of thevoting power of the Company than such other Person or Group described in Section 2-7(a)(3)(A) above;

 

(4)                                  the replacement of a majority of the membersof the Board over a two-year period from the members who constituted the Boardat the beginning of such period, and such replacement shall not have beenapproved by a vote of at least a majority of the members of the Board thenstill in office who either were members of such Board at the beginning of suchperiod or whose election as a member of such Board was previously so approvedor who were nominated by, or designees of, a Majority Stockholder; or

 

(5)                                  consummation of a merger or consolidation ofthe Company with another entity in which holders of the Common Stock of theCompany immediately prior to the consummation of the transaction hold, directlyor indirectly, immediately following the consummation of the transaction, lessthan 50% of the common equity interest in the surviving corporation in suchtransaction and the Majority Stockholder does not hold a sufficient amount ofvoting power (or similar securities) to elect a majority of the survivingentity’s board of directors.

 

(b)                                 For purposes of this Section 2-7, thefollowing terms shall have the following meanings:

 

(1)                                  “CIC Affiliate” shall mean, withrespect to any entity, any other corporation, organization, association,partnership, sole proprietorship or other type of entity, whether incorporatedor unincorporated, directly or indirectly controlling or controlled by or underdirect or indirect common control with such entity.

 

(2)                                  “Common Stock” shall mean the commonstock of the Company, $0.01 par value per share.

 

(3)                                  “Majority Stockholder” shall mean,collectively or individually as the context requires, Newton Holding, LLC, TPGNewton III, LLC, TPG Partners IV, L.P., TPG Newton Co-Invest I, LLC, WarburgPincus Private Equity VIII, L.P., Warburg Pincus Netherlands Private EquityVIII C.V. I, Warburg

 

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Pincus Germany PrivateEquity VIII K.G, Warburg Pincus Private Equity IX, L.P and/or their respectiveCIC Affiliates.

 

(4)                                  “Person”shall mean an individual, partnership, corporation, limited liability company,unincorporated organization, trust or joint venture, or a governmental agencyor political subdivision thereof.

 

Section 2-8                                     “Claimant”means a person who believes that he or she is being denied a benefit to whichhe or she is entitled under the Plan.

 

Section 2-9                                     “Code”means the Internal Revenue Code of 1986, as amended.

 

Section 2-10                               “Committee”means The Neiman Marcus Group, Inc. Employee Benefits Committee or anysuccessor committee appointed by the Board.

 

Section 2-11                               “Company”means The Neiman Marcus Group, Inc. a Delaware corporation, and anysuccessor, including a successor to all or substantially all of the Company’sassets or business which assumes the obligations of the Company.

 

Section 2-12                               “CompensationLimitation” means the dollar limitation in effect under Section 401(a)(17)(A) ofthe Code with respect to a Plan Year, as adjusted pursuant to Section 401(a)(17)(B) ofthe Code.

 

Section 2-13                               “DBSERP” means The Neiman Marcus Group, Inc. Defined Benefit SupplementalExecutive Retirement Plan.

 

Section 2-14                               “DefinedContribution” means the amounts credited to the Plan on behalf of anEligible Employee by the Company pursuant to Section 4-1(a) or Section 4-1(b) below.

 

Section 2-15                               “DefinedContribution Account” means the bookkeeping account established by theCompany to which are credited Transitional Defined Contributions and Non-TransitionalDefined Contributions, and notational earnings and losses thereon.

 

Section 2-16                               “Disabled”means:

 

(a)                                  subjectto Section 2-16(b) below, a condition:

 

(1)                                  inwhich the Committee, in its sole and absolute discretion, determines hasrendered the Participant unable to engage in any substantial gainful activityby reason of any medically determinable physical or mental impairment that canbe expected to result in death or can be expected to last for a continuousperiod of not less than 12 months, or

 

(2)                                  forwhich the Participant, by reason of any medically determinable physical ormental impairment that can be expected to result in death or can be expected tolast for a continuous period of not less than 12 months, is receiving incomereplacement benefits for a period of not less than three months under anaccident and health plan covering employees of the Participant’s Employer.

 

(b)                                 NotwithstandingSection 2-16(a) above, a Participant shall be deemed to be Disabledif such Participant is determined to be totally disabled by the Social SecurityAdministration.

 

Section 2-17                               “EffectiveDate” means January 1, 2008.

 

Section 2-18                               “EligibleCompensation” means all of the items reflected in Section 2-18(a) belowand excluding the items reflected in Section 2-18(b) below:

 

(a)                                  Subjectto the exclusions enumerated in Section 2-18(b) below, the term “EligibleCompensation” includes:

 

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(1)                        wages, within the meaning of Section 3401(a) ofthe Code, and all other payments of remuneration to a Participant by anEmployer for which the Employer is required to furnish the Participant awritten statement under Sections 6041(d), 6051(a)(3) and 6052 of the Code, but determined without regard to any rules thatlimit the remuneration included in wages based on the nature or location of theemployment or the services performed (such as the exception for agriculturallabor in Section 3401(a)(2) of the Code),

 

(2)                        any contributions made by an Employer onbehalf of the Participant to a qualified cash or deferred arrangement (asdefined in Section 401(k) of the Code) maintained by the Employer,

 

(3)                        any compensation reduction amounts elected by such Participant for the purchase ofbenefits pursuant to a cafeteria plan (within the meaning of Section 125(d) ofthe Code) maintained the Employer, and

 

(4)                        any elective amounts not includable in a Participant’s grossincome by reason of Section 132(f)(4) of the Code.

 

(b)                                 Notwithstanding the compensatory itemsenumerated in Section 2-18(a) above, the term “Eligible Compensation”excludes:

 

(1)                                  moving or other expense reimbursements,

 

(2)                                  imputed compensation,

 

(3)                                  property,

 

(4)                                  tips,

 

(5)                                  allowances,

 

(6)                                  fringe benefits (both cash and noncash),

 

(7)                                  severance payments,

 

(8)                                  service awards and prizes other those paid incash through an Employer’s payroll system,

 

(9)                                  contributions to a nonqualified plan ofdeferred compensation made by the an Employer to the extent that thecontributions are not includible in the gross income of the Participant for thetaxable year in which contributed,

 

(10)                            distributions from any other plan of deferred compensation, regardlessof whether such amounts are includible in the gross income of the Participantwhen distributed,

 

(11)                            amounts received in connection with or otherwise attributable to awardsor grants under any stock option plan, restricted stock plan, restricted stockunit plan, performance share plan, or similar plan,

 

(12)                            other amounts which receive special tax benefits, including premiums forgroup-term life insurance,

 

(13)                            incentive payments earned through a wellness or similar program sponsoredby an Employer, and

 

(14)                            any other extraordinary remuneration.

 

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Section 2-19                               “Eligible Employee”

 

(a)                                  Subject to Section 2-19(b) below,the term “Eligible Employee” means each Employee who, as of the Effective Dateor the first day of any Plan Year thereafter:

 

(1)                                  has completed at least one Year of Service, orsuch shorter period of service as may be specified by the Committee, in itssole and absolute discretion; and

 

(2)                                  in the sole and absolute discretion of theCommittee:

 

(A)                              is or was a member of a group of “keymanagement or other highly compensated employees” of the Employer, within themeaning of Sections 201, 301 and 401 of ERISA,

 

(B)                                is actively employed on a full-time basis,

 

(C)                                is not classified as an hourly employee,

 

(D)                               is, or has been, designated as being eligibleto participate in the Plan, and

 

(E)                                 either:

 

(i)                                     had in effect on August 1 of thepreceding calendar year (or, if later, on the Employee’s date of hire) a rateof Base Pay of at least 80% of the Compensation Limitation applicable to suchpreceding calendar year, or

 

(ii)                                  was both:

 

(I)                                    participating in the DB SERP on December 31,2007, and

 

(II)                                either:

 

(a)                                  elected to both cease participating in the DBSERP and commence participation in this Plan, or

 

(b)                                 ceased to be eligible to participate in the DBSERP solely as a result of the partial freezing of eligibility under the DBSERP.

 

(b)                                 Notwithstanding Section 2-19(a) above,an Eligible Employee shall remain an Eligible Employee notwithstanding anyreduction in his or her annual rate of Base Pay below the applicable minimumreflected in Section 2-19(a)(2)(E)(i) above; provided, however, that theCommittee in its sole and absolute discretion may withdraw an Employee’sdesignation under Section 2-19(a)(2)(D) above, as an Eligible Employee at anytime and for any reason effective with respect to any subsequent Plan Year.

 

Section 2-20                               “Employee” means any individual who isemployed by the Employer whose earnings are reported on Form W-2.

 

Section 2-21                               “Employer” means the Company and eachAffiliate. An Affiliate may revoke its acceptance of such designation at anytime, but until such acceptance has been revoked, all of the provisions of thePlan and amendments thereto shall apply to the Eligible

 

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Employees of theAffiliate. In the event the designation is revoked by an Affiliate, the Planshall be deemed terminated only with respect to such Affiliate.

 

Section 2-22                               “EnrollmentAgreement” means the authorization form which an Eligible Employee timelyfiles with the Committee to designate the time of distributions from the Plan,pursuant to the terms set forth in Section 4-2 below.

 

Section 2-23                               “ERISA” means the Employee RetirementIncome Security Act of 1974, as amended.

 

Section 2-24                               “Exchange Act” means the SecuritiesExchange Act of 1934, as amended.

 

Section 2-25                               “Hour of Service” means each hour forwhich an Employee is paid or entitled to payment for the performance of dutiesfor an Employer or an Affiliate.

 

Section 2-26                               “Identification Date” means December 31.

 

Section 2-27                            “Key Employee”

 

(a)                                  The term “Key Employee” means an Employee whois one of the following:

 

(1)                                  an officer of the Employer having annualcompensation greater than $140,000 (adjusted for inflation pursuant to Section 416(i) of the Code and limited to the top 50Employees),

 

(2)                                  a five percent owner of the Employer, or

 

(3)                                  a one percent owner of the Employer havingannual compensation from the Employer of more than $150,000, subject to suchother determinations made by the Committee, in its sole discretion, in a mannerconsistent with the regulations issued under Section 409A of the Code.

 

(b)                                 For purposes of this definition, the term“compensation” shall have the meaning under Treas. Reg. § 1.415(c)-2(a),without using the safe harbor provided in Treas. Reg. § 1.415(c)-2(d), any ofthe special timing rules provided in Treas. Reg. § 1.415(c)-2(e), and anyspecial rules provided in Treas. Reg. § 1.415(c)-2(g).

 

Section 2-28                               “Non-Transitional Defined Contribution”means the amounts credited to the Plan on behalf of an Eligible Employee by theCompany pursuant to Section 4-1(a) below.

 

Section 2-29                               “Participant” means each EligibleEmployee who is participating in the Plan in accordance with the provisions ofARTICLE IV below. In the event of a Participant’s death, the term Participantshall mean the Participant’s Beneficiary. In the case of a Participant’sincompetency, the term Participant shall include an individual with a dulyauthorized power of attorney or, in the absence of a duly authorized power ofattorney, the Participant’s personal representative or guardian. An individualshall remain a Participant until that individual has received full distributionof any amount credited to the Participant’s Defined Contribution Account.

 

Section 2-30                               “Plan” means this plan, called TheNeiman Marcus Group, Inc. Defined Contribution Supplemental ExecutiveRetirement Plan.

 

Section 2-31                               “Plan Year” means the 12 month periodbeginning on each January 1 and ending on the following December 31.

 

Section 2-32                               “Separation Date” means the date onwhich a Participant incurs a Separation From Service.

 

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Section 2-33                               “SeparationFrom Service” means a Participant’s separationfrom service with the Employer within the meaning of Section 409A of theCode and the regulations issued thereunder.

 

Section 2-34                               “SpecifiedDistribution Date” means a specific time, within the meaning of Section 409Aof the Code and the regulations promulgated thereunder, that is designated bythe Participant in his or her Enrollment Agreement or Amended EnrollmentAgreement, as applicable; provided, however, that the Specified DistributionDate cannot be sooner than the date on which the Participant has:

 

(a)                                  vestedin all of the amounts credited tohis or her Defined Contribution Account pursuant to ARTICLE VI below, and

 

(b)                                 either:

 

(1)                                  attained age fifty-five (55),

 

(2)                                  died,or

 

(3)                                  determined to be Disabled.

 

Section 2-35                               “SpecifiedEmployee” means an Employee who at any time during the 12-month periodending on an Identification Date is a Key Employee. If an Employee would bedeemed a Key Employee as of an Identification Date, the Employee is treated asa “Specified Employee” for the 12-month period beginning on the fourth monthfollowing the end of the 12- month period following the Identification Date.Notwithstanding the foregoing, unless otherwise provided under Section 409Aof the Code and its corresponding regulations, no Participant shall be deemed aSpecified Employee if at the time of the Participant’s Separation From Serviceno stock of the Employer, or any entity required to be aggregated with theEmployer pursuant to Section 414(b) or 414(c) of the Code, ispublicly traded on an established securities market or otherwise.

 

Section 2-36                               “TransitionalDefined Contribution” means the amounts credited to the Plan on behalf ofan Eligible Employee by the Company pursuant to Section 4-1(b) below.

 

Section 2-37                               “Yearof Service” means completion of the twelve consecutive month periodbeginning on the date the Employee first performs an hour of service uponinitial employment with an Employer or an Affiliate during which the Employeeis continuously employed by an Employer or an Affiliate or, with respect to anEmployee who terminates employment prior to completing a Year of Service,completion of the twelve consecutive month period beginning on the date theEmployee first performs an hour of service upon reemployment with an Employeror an Affiliate during which the Employee is continuously employed by anEmployer or an Affiliate.

 

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ARTICLE IIIADMINISTRATION OF THE PLAN AND DISCRETION

 

Section 3-1                                     Administration. The Committee shall have full powerand authority to interpret the Plan, to prescribe, amend and rescind any rules,forms and procedures as it deems necessary or appropriate for the properadministration of the Plan and to make any other determinations and to take anyother such actions as it deems necessary or advisable in carrying out itsduties under the Plan. All action taken by the Committee arising out of, or inconnection with, the administration of the Plan or any rules adoptedthereunder, shall, in each case, lie within its sole discretion, and shall befinal, conclusive and binding upon the Company, the Employer, the Board, allParticipants, all Beneficiaries of Participants and all persons and entitieshaving an interest therein, and a Participant’s participation in the Plan shallconstitute that Participant’s acknowledgement and acceptance of the Committee’sauthority and discretion. The Committee may from time to time adopt rules andregulations governing the operation of this Plan and may employ and rely onsuch employees of the Employer, legal counsel, accountants, and agents, as itmay deem advisable to assist in the administration of the Plan.

 

Section 3-2                                     Compensation of Committee; Expenses. Members of the Committee shall servewithout compensation for their services unless otherwise determined by theBoard. All expenses of administering the Plan shall be paid by the Company.

 

Section 3-3                                     Indemnification. the Company shall indemnify, defendand hold the Committee harmless from any and all claims, losses, damages,expenses (including counsel fees) and liability (including any amounts paid insettlement of any claim or any other matter with the consent of the Board)arising from any act or omission of such member, except when the same is due togross negligence or willful misconduct.

 

Section 3-4                                     Interpretations. Any decisions, actions orinterpretations to be made under the Plan by the Company, the Employer, theBoard or the Committee shall be made in its respective sole discretion, not asa fiduciary, need not be uniformly applied to similarly situated individualsand shall be final, binding and conclusive on all persons interested in thePlan.

 

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ARTICLE IVPARTICIPATION

 

Section 4-1                                     Defined Contributions.

 

(a)                                  Non-Transitional Defined Contributions. Effective as of the Effective Date,the Company shall make a Non-Transitional Defined Contribution to the Plan onbehalf of each Eligible Employee periodically throughout the Plan Year. Theaggregate amount of such Non-Transitional Defined Contributions credited onbehalf of each Eligible Employee during each Plan Year will be equal to theproduct of:

 

(1)                                  thatportion of such Eligible Employee’s Eligible Compensation that exceeds theCompensation Limitation, and

 

(2)                                  tenand one-half percent (10.5%).

 

(b)                                 Transitional Defined Contributions.

 

(1)                                  Inaddition to amounts credited to Eligible Employees under Section 4-1(a) above,effective as of the Effective Date, the Company shall periodically makeTransitional Defined Contributions during the Plan Year on behalf of eachEligible Employee who:

 

(A)                              waseligible under the DB SERP as of December 31, 2007, and

 

(B)                                hasneither attained, nor will attain, age sixty-six (66) during the Plan Year towhich the Transitional Defined Contribution would otherwise relate if creditedto such Eligible Employee’s Defined Contribution Account.

 

(2)                                  Theaggregate amount of such Transitional Defined Contributions for the Plan Yearfor each Eligible Employee who has satisfied the eligibility criteria reflectedin Section 4-1(b)(1) above, shall be equal to the product of:

 

(A)                              thatportion of such Eligible Employee’s Eligible Compensation that exceeds theCompensation Limitation, and

 

(B)                                theapplicable percentage that corresponds with the highest age attained by theEligible Participant during the Plan Year to which the Transitional DefinedContribution would otherwise relate, according to the schedule set forth below:

 
| **Eligible Employee’s  Highest Age During  Applicable Plan Year** | ** ** | **Applicable Percentage or  Eligible Compensation** | ** ** |
|-------------------------------------------------------------------------------------------------|------------|--------------------------------------------------------------------|------------|
| 30 - 39                                                                                         |       | 3                                                                  | %          |
| 40 - 49                                                                                         |       | 4                                                                  | %          |
| 50 – 59                                                                                    |       | 5                                                                  | %          |
| 60 - 65                                                                                         |       | 6                                                                  | %          |
| 66 and Older                                                                                    |       | 0                                                                  | %          |

 

(c)                                  Timing of Defined Contributions. Any Defined Contribution made under thisSection 4-1 will be credited to the Employee’s Defined ContributionAccount no later than as soon as administratively practicable following theclose of the Plan Year to which such Defined Contribution relates.

 

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Section 4-2                                     Time of Distribution.

 

(a)                                  Affirmative Election.

 

(1)                                  Subject to Section 7-2, Section 7-3,Section 7-4 and Section 7-5 below, the Committee, in its sole andabsolute discretion, may permit an Eligible Employee to elect to receive thedistribution of his or her Defined Contributions for each Plan Year upon the later of:

 

(A)                              his or her Separation From Service, or

 

(B)                                his or her Specified Distribution Date.

 

(2)                                  Notwithstanding anything herein to the contrary, anaffirmative election will be disregarded and given no consideration if such anelection is not reflected on a completed and fully executed EnrollmentAgreement that is timely with the Committee by the earlier of:

 

(A)                              the date set by the Committee, in its sole andabsolute discretion, or

 

(B)                                the first day of the Plan Year for which theDefined Contribution relates.

 

(b)                                 Deemed Election. Subject to Section 7-2, Section 7-3,Section 7-4 and Section 7-5 below, to the extent an Eligible Employeehas not made an affirmative election regarding the distribution of his or herDefined Contributions for a given Plan Year, pursuant to Section 4-2(a) above,the Eligible Employee shall be deemed to have designated the time of payment asthe later of:

 

(1)                                  Separation From Service, and

 

(2)                                  the attainment of age fifty-five (55).

 

Section 4-3                                     Form of Distribution. Subject to Section 7-3 below,the distribution of a Participant’s Defined Contribution Account will be madein five (5) annual installments commencing on the time of distributionelected, or deemed to have been elected, by the Participant underSection 4-2 above.

 

Section 4-4                                     Modificationsof Distribution Timing. Except as provided in Section 7-6 below, theelection as to the time of payment cannot be subsequently changed.

 

Section 4-5                                     Characterizationof Payments for 409A Purposes. For purposes of Section 409A of theCode, installment payments under the Plan shall be treated as a series ofseparate payments.

 

Section 4-6                                     Changein Status. If at any time during the Plan Year an Eligible Employee ceasesto qualify as such, then the following provisions shall apply:

 

(a)                                  Cessation as an Eligible Employee.

 

(1)                                  If an Eligible Employee ceases to qualify asan Eligible Employee at any time during the Plan Year, but remains employed byan Employer, the Company will credit to such Eligible Employee’s DefinedContribution Account, at the same time that Defined Contributions are creditedto the other Eligible Employees’ Defined Contribution Accounts, an amount equalto the amount that the Eligible Employee would have received if the Eligible Employeecontinued as such for the remainder of the Plan Year, except only the portionof the Employee’s Compensation that was earned during the period he or shequalified as an Eligible Employee will be counted for this purpose. For

 

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purposes of determiningthe portion of any bonus or similar remuneration that will be counted for thispurpose, only a pro rata portion of such remuneration will be counted, withsuch pro rata portion determined by multiplying the amount of such remunerationfor the Plan Year, by a fraction, the numerator of which is the number of daysthe Employee qualified as an Eligible Employee for the Plan Year and thedenominator of which is 365; and

 

(2)                                  Inaddition, the Eligible Employeeshall not be eligible to receive any further Defined Contributions for anyfuture Plan Year, unless the Employee subsequently qualifies as an EligibleEmployee.

 

(b)                                 Terminationof Employment for any Reason Other Than Cause. If an Eligible Employeeceases to be employed by an Employer at any time during the Plan Year for anyreason other than a termination of employment by the Employer for Cause, theCompany will credit, as soon as administratively practicable following the datethe Eligible Employee terminates employment with the Employer, to the DefinedContribution Account of such Eligible Employee, a Defined Contribution equal tothe amount that the Eligible Employeeaccrued for the Plan Year ending on the date such Eligible Employee terminatedemployment, except that no amount will be credited for any portion of any bonusor similar remuneration, if any, that is paid to the Eligible Employeefollowing the date of his or her termination of employment, and no additionalDefined Contribution will be credited for such Eligible Employee.

 

(c)                                  Terminationof Employment for Cause. If an Eligible Employee ceases to be employed byan Employer at any time during the Plan Year as a result of a termination ofemployment by the Employer for Cause, all Defined Contributions that have beencredited on behalf of such Eligible Employee shall be forfeited. Furthermore,in such instances, no amounts will be credited to such Eligible Employee’sDefined Contribution Account for the Plan Year in which such termination ofemployment occurs.

 

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ARTICLE VINVESTMENT CREDITS AND FUNDING

 

Section 5-1                                     TheoreticalRate of Return. A Participant’s Defined Contribution Account shall becredited with a theoretical rate of return, which shall be established, and maybe prospectively modified at any time, by the Committee, in its sole andabsolute discretion; provided, however, that the Committee may not reduce thetheoretical rate of return below an annual rate equal to the average primeinterest rate published in the Eastern Edition of *The WallStreet Journal* on the last business day of the preceding calendarquarter (or, if two or more such rates are published, the average of suchrates), unless the Committee otherwise adopts two or more notional investmentalternatives.

 

Section 5-2                                     NotionalInvestment Alternatives. To the extent two or more notional investmentalternatives are established by the Committee, the returns on eachParticipant’s Defined Contribution Account will be based upon the notionalinvestment alternatives elected by the Participant. Notwithstanding theforegoing, if two or more notional investment alternatives are established bythe Committee and a Participant does not affirmatively elect one or morenotional investment alternatives, until the Participant makes an affirmativeelection regarding the notional investment alternatives on which the return ofhis or her Defined Contribution Account will be based, the Participant will bedeemed to have elected the default investment option that the Committee hasdesignated for this purpose. Additionally, if two or more notional investmentalternatives are established by the Committee, unless otherwise provided underthis Plan, Participants may allocate the amounts credited to their DefinedContribution Accounts among the notional investment alternatives availableunder the Plan only in whole percentages of not less than one percent. The rateof return, positive or negative, credited under any notional investmentalternative will be based upon the actual investment performance of theinvestment fund(s) designated by the Committee from time to time, andshall equal the total return of such investment fund, net of asset-basedcharges, including, without limitation, money management fees, fund expensesand mortality and expense risk insurance contract charges.

 

Section 5-3                                     Changesof Notional Investment Alternatives, if Applicable. To the extentestablished by the Committee, a Participant may change the notional investmentalternatives to which the Participant’s Defined Contribution Accounts aredeemed to be allocated on such basis as determined by the Committee in its soleand absolute discretion. Each such change may include:

 

(a)                                  areallocation of the amounts credited to the Participant’s Defined ContributionAccount among the notional investment alternatives available in whole percentagesof not less than one percent, and/or

 

(b)                                 achange in investment allocation in whole percentages of not less than onepercent of amounts to be credited to the Participant’s Defined ContributionAccount in the future.

 

Section 5-4                                     UnfundedStatus. Notwithstanding anything herein to the contrary, the Company shallnot be obligated to invest any Defined Contribution under this Plan, or anyother amounts, in such portfolios or in any other investment funds. The Planshall be entirely unfunded and no provision shall at any time be made withrespect to segregating any assets of the Company or an Employer for payment ofany distributions hereunder; however, the Board may, but shall not be required,to authorize the establishment of a trust or the purchase of insurance to serveas a funding vehicle for the Company’s obligations with respect to the Plan. Inany event, the obligation of the Company hereunder shall constitute a general,unsecured obligation, payable solely from the general assets of the Company,and no Participant shall have any rights to any specific assets of the Companyor any Employer.

 

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Section 5-5                                     Valuation. The value of a Participant’s DefinedContribution Account as of any date shall equal the amounts theretoforecredited to such Defined Contribution Account, including any earnings (positiveor negative) deemed to be earned on such Defined Contribution Account inaccordance with Section 5-1, or, if applicable, Section 5-2 above,through the day preceding such date, less the amounts theretofore deducted fromsuch Defined Contribution Account.

 

Section 5-6                                     DefinedContribution Account Statement. TheCommittee shall provide to each Participant, not less frequently than quarterly(or such other period as determined by the Committee in its sole discretion), astatement in such form as the Committee deems desirable, setting forth thebalance standing to the credit of each Participant in his or her DefinedContribution Account, and adjusted pursuant to Section 5-5 above.

 

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ARTICLE VIVESTING

 

An Eligible Employeeshall be fully vested in the amounts credited to his or her DefinedContribution Account upon the earlier of:

 

(a)                                  hisor her completion of five (5) Years of Service;

 

(b)                                 hisor her attainment of age 65;

 

(c)                                  ifhe or she was an Employee at the time of his or her death, the date of his orher death;

 

(d)                                 ifhe or she was an Employee at the time he or she becomes Disabled, the date heor she becomes Disabled, or

 

(e)                                  ifhe or she was an Employee at the time of the Change of Control, the date of aChange of Control.

 

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ARTICLE VIIDISTRIBUTIONS

 

Section 7-1                                     Distributions. A Participant shall receive a distributionof the vested amount credited to his or her Defined Contribution Account underthe Plan at the time or times and in the form or forms selected by theParticipant in the Enrollment Agreement, as provided in ARTICLE IV, or pursuantto one or more Amended Enrollment Agreements, as provided in Section 7-6below; provided, however, that if the distribution of an amount credited to theParticipant’s Defined Contribution Account is to commence upon his or herSeparation From Service and such Participant is a Specified Employee at thetime of his or her Separation From Service, the provisions of Section 7-2below shall apply to such distribution. A distribution paid pursuant to this Section 7-1shall commence to be paid by the Company to the Participant as soon asadministratively practicable on or following the time designated by theParticipant, but no later than sixty (60) days following such designated time,and shall be paid to the Participant entirely in cash.

 

Section 7-2                                     Distributions on Separation From Service forParticipants Who Are Deemed Specified Employees. Any Participant who is deemed a SpecifiedEmployee at the time of his or her Separation From Service and designated, orwas deemed to have designated, as his or her distribution commencement date hisor her Separation From Service as the time for distribution of the vestedamounts credited to his or her Defined Contribution Account under the Planshall commence to receive such distribution(s) under the Plan as soon asadministratively practicable after the first day of the seventh month followingthe Participant’s Separation Date, but no later than sixty (60) days followingsuch date. If a distribution is delayed because of the immediately precedingsentence, the first distribution will be equal to the installment that theParticipant would have received during the first six (6) months followingthe Participant’s Separation From Service, plus earnings or losses, and theremaining installments shall be paid as if the installments commenced on theParticipant’s Separation Date. A distribution paid pursuant to this Section 7-2shall be paid entirely in cash.

 

Section 7-3                                     Death of Participant. If a Participant dies prior to commencementof his or her benefit under the Plan, the Participant’s Beneficiary shallreceive a lump sum cash distribution of the entire vested amount credited tothe Participant’s Defined Contribution Account as soon as administrativelypracticable following the date of discovery of, or notification regarding, theParticipant’s death, but no later than sixty (60) days following the discoveryof, or notification regarding the Participant’s death. If a Participant diesafter commencement of his or her benefit under the Plan, the Participant’sBeneficiary shall receive a lump sum cash distribution of the remaininginstallments payable to the Participant under the Plan as soon asadministratively practicable following the date of the Participant’s death, butnot later than sixty (60) days following the discovery of, or notificationregarding the Participant’s death.

 

Section 7-4                                     Disability of Participant. If a Participant becomes Disabled prior to commencementof his or her benefit under the Plan, the Participant shall receive a lump sumcash distribution of the entire vested amount credited to his DefinedContribution Account as soon as administratively practicable following the datethe Committee determines that such Participant is Disabled, but no later thansixty (60) days following such determination. If a Participant becomes Disabledafter commencement of his or her benefit under the Plan, the Participant shallreceive a lump sum cash distribution of the remaining installments payable tothe Participant under the Plan as soon as administratively practicablefollowing the date the Committee determines that such Participant is Disabled,but no later than sixty (60) days following such determination. Notwithstandinganything herein to the contrary, if the Participant, in the sole judgment ofthe Committee, is considered by reason of physical or mental condition to beunable to give a valid receipt therefore, the Committee may direct payment inaccordance with Section 10-15 below.

 

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Section 7-5                                     Changeof Control. In the event of a Change in Control, to the extent such Changeof Control is a permitted distribution event with respect to such Participantpursuant to Code Section 409A(a)(2)(A)(v), all amounts credited to eachParticipant’s Defined Contribution Account shall be distributed in single lumpsum cash payments, regardless of whether or not any such Participants havealready commenced benefits under the Plan, at the time of such Change inControl or within five business days thereafter.

 

Section 7-6                                     Changein Time.

 

(a)                                  Subjectto Section 7-6(b) below, a Participant may change the time of a distributiondesignated in an Enrollment Agreement for a particular Plan Year by filing anAmended Enrollment Agreement with the Committee in accordance with therequirements of this Section 7-6; provided, however, that to change thetime of a distribution for a particular Plan Year:

 

(1)                                  theAmended Enrollment Agreement applicable to such distribution will not becomeeffective for the twelve (12) month period after the date on which the AmendedEnrollment Agreement is filed with the Committee;

 

(2)                                  thedistribution cannot commence for a period that is not less than five (5) yearsfrom the date such payment was originally scheduled to commence pursuant to theoriginal Enrollment Agreement; and

 

(3)                                  withrespect to a change in a time or form of payment on a Specified DistributionDate, the Amended Enrollment Agreement cannot be made less than twelve (12)months prior to the date of the scheduled payment.

 

(b)                                 Notwithstandinganything herein to the contrary:

 

(1)                                  withthe exception of a Participant’s death or disability, once payment hascommenced, the time of such payment shall not be modified, and

 

(2)                                  aSpecified Distribution Date that applies to the distribution of a Participant’sDefined Contributions for a given Plan Year may not be postponed by more thanten (10) years from the date originally elected, or, if applicable, deemedto have been elected.

 

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ARTICLE VIIIAMENDMENT AND TERMINATION

 

The Plan may be amended,suspended, discontinued or terminated at any time by the Board; provided,however, that, except as provided below, no such amendment, suspension,discontinuance or termination shall reduce or in any manner adversely affectthe rights of any Participant with respect to benefits that are payable or maybecome payable under the Plan based upon the balance of the Participant’sDefined Contribution Account as of the effective date of such amendment,suspension, discontinuance or termination. The Committee may, at any time, alsomake such amendments to the Plan as it deems necessary and appropriate, in itssole and absolute discretion, without Board approval, provided that any suchamendments to the Plan by the Committee may not materially increase the costsof the Plan to the Company or any other Employer or result in a materialadverse affect on a Participant. Notwithstanding anything to the contrary inthis ARTICLE VIII, if the Committee determines that, in order to avoid currenttaxation of amounts deferred under the Plan or to comply with applicable law,additional restrictions must be placed on Participants’ rights under the Plan,then the Committee may, in its sole discretion, amend the Plan to impose suchrestrictions, and/or cease contributions under the Plan with respect to allDefined Contribution Accounts, any affected Defined Contribution Accounts orthe affected portions of any Defined Contribution Accounts. If the Boardterminates the Plan, Participants shall be entitled to a distribution of theirbenefit under the Plan if the termination is on account of a permitteddistribution event under Treas. Reg. §1.409A-3(j)(4)(ix)(A), (B), (C) or (D) andthe requirements, as applicable, of such regulations are met with respect tothe termination of the Plan and distribution of benefits hereunder.

 

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ARTICLE IXCLAIMS PROCEDURES

 

Section 9-1                                     Claim.A Claimant may file a written request for such benefit with the Committee,setting forth the claim.

 

Section 9-2                                     ClaimDecision. Upon receipt of a claim, the Committee shall advise the Claimantthat a reply will be forthcoming within ninety (90) days and shall, in fact,deliver such reply within such period. The Committee may, however, extend thereply period for an additional ninety (90) days for reasonable cause. If theclaim is denied in whole or in part, the Claimant shall be provided a writtenexplanation, using language calculated to be understood by the Claimant,setting forth:

 

(a)                                  thespecific reason or reasons for such denial;

 

(b)                                 thespecific reference to relevant provisions of the Plan on which such denial isbased;

 

(c)                                  adescription of any additional material or information necessary for theClaimant to perfect the claim and an explanation why such material or such informationis necessary;

 

(d)                                 appropriateinformation as to the steps to be taken if the Claimant wishes to submit theclaim for review;

 

(e)                                  thetime limits for requesting a review; and 

 

(f)                                    thatthe Claimant has the right to bring an action for benefits under Section 502of ERISA following an adverse determination on review.

 

Section 9-3                                     Requestfor Review. Within sixty (60) days after the receipt by the Claimant of thewritten opinion described above, the Claimant may request in writing that theCommittee review its determination. The Claimant, or his or her duly authorizedrepresentative, may, but need not, review the pertinent documents and submitissues and comments in writing for consideration by the Committee. If theClaimant does not request a review of the initial determination within suchsixty (60) day period, the Claimant shall be barred and estopped fromchallenging the determination.

 

Section 9-4                                     Reviewof Decision.

 

(a)                                  Withinsixty (60) days after the Committee’s receipt of a request for review, it willreview the initial determination. After considering all materials presented bythe Claimant, the Committee will render a written opinion, written in a mannercalculated to be understood by the Claimant. If the decision is adverse, thewritten opinion will:

 

(1)                                  setforth the specific reasons for the decision and specific references to therelevant provisions of this Plan on which the decision is based; and

 

(2)                                  includea statement that the Claimant is entitled to receive, upon request and free ofcharge, reasonable access to, and copies of, all documents, records and otherinformation relevant to the claim and that the Claimant may bring an actionunder Section 502(a) of ERISA.

 

(b)                                 Ifspecial circumstances require that the sixty (60) day time period be extended,the Committee will so notify the Claimant and will render the decision as soonas possible, but no later than one hundred twenty (120) days after receipt ofthe request for review.

 

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ARTICLE XMISCELLANEOUS

 

Section 10-1                               Designation of Beneficiary. Each Participant may designate a Beneficiary or Beneficiaries (whichBeneficiary may be an entity other than a natural person) to receive anypayments which may be made following the Participant’s death. Such designationmay be changed or canceled at any time without the consent of any suchBeneficiary. Any such designation, change or cancellation must be made in aform approved by the Committee and shall not be effective until received by theCommittee, or its designee. If no Beneficiary has been named, or the designatedBeneficiary or Beneficiaries shall have predeceased the Participant, theBeneficiary shall be the Participant’s estate. If a Participant designates morethan one Beneficiary, the interests of such Beneficiaries shall be paid inequal percentages, unless the Participant has specifically designatedotherwise.

 

Section 10-2                               Limitationof Participant’s Right. Nothing in this Plan shall be construed asconferring upon any Participant any right to continue in the employment of theEmployer, nor shall it interfere with the rights of the Employer to terminatethe employment of any Participant and/or to take any personnel action affectingany Participant without regard to the effect which such action may have uponsuch Participant as a recipient or prospective recipient of benefits under thePlan. Any amounts payable hereunder shall not be deemed salary or othercompensation to a Participant for the purposes of computing benefits to whichthe Participant may be entitled under any other arrangement established by theEmployer for the benefit of its employees.

 

Section 10-3                               NoLimitation on Employer Actions. Nothing contained in the Plan shall beconstrued to prevent the Employer from taking any action which is deemed by itto be appropriate or in its best interest. No Participant, Beneficiary, orother person shall have any claim against the Employer as a result of suchaction.

 

Section 10-4                               Obligationsto the Employer. If a Participant becomes entitled to a distribution ofbenefits under the Plan, and if at such time the Participant has outstandingany debt, obligation, or other liability representing an amount owing to theEmployer, then the Company may offset such amount owed to the Employer againstthe amount of benefits otherwise distributable, but only as such amounts becomedistributable. Such determination shall be made by the Committee.

 

Section 10-5                               Non-alienationof Benefits.

 

(a)                                  Exceptas expressly provided herein, no Participant or Beneficiary shall have thepower or right to transfer (otherwise than by will or the laws of descent anddistribution), alienate, or otherwise encumber the Participant’s interest underthe Plan. The Company’s obligations under this Plan are not assignable ortransferable except to:

 

(1)                                  anycorporation or partnership which acquires all or substantially all of theCompany’s assets; or

 

(2)                                  anycorporation or partnership into which the Company may be merged orconsolidated.

 

(b)                                 Theprovisions of the Plan shall inure to the benefit of each Participant and theParticipant’s Beneficiaries, heirs, executors, administrators or successors ininterest.

 

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Section 10-6                               Protective Provisions. Each Participant shall cooperate with the Company by furnishing any andall information requested by the Company in order to facilitate the payment ofbenefits hereunder, taking such physical examinations as the Company may deemnecessary and taking such other relevant action as may be requested by theCompany. If a Participant refuses to cooperate, the Company shall have nofurther obligation to the Participant under the Plan, other than payment tosuch Participant of then current balance of the Participant’s DefinedContribution Account in accordance with his or her prior elections.

 

Section 10-7                               WithholdingTaxes. The Company and/or the Employer may make such provisions and takesuch action as it may deem necessary or appropriate for the withholding of anytaxes which the Company and/or the Employer is required by any law orregulation of any governmental authority, whether federal, state or local, towithhold in connection with any deferrals, amounts credited or benefits payableunder the Plan, including, but not limited to, withholding of appropriate sumsfrom any amount payable to the Participant (or his or her Beneficiary) underthe Plan or otherwise payable to the Participant from other sources. EachParticipant, however, shall be responsible for the payment of all individualtax liabilities relating to any such deferrals, credits and benefits.

 

Section 10-8                               UnfundedStatus of Plan. The Plan is intended to constitute an “unfunded” plan ofdeferred compensation for Participants. Benefits payable hereunder shall bepayable out of the general assets of the Company, and no segregation of anyassets whatsoever for such benefits shall be required. With respect to anypayments not yet made to a Participant, nothing contained herein shall give anysuch Participant any rights to assets that are greater than those of a generalcreditor of the Company.

 

Section 10-9                               Severability.If any provision of this Plan is held unenforceable, the remainder of the Planshall continue in full force and effect without regard to such unenforceableprovision and shall be applied as though the unenforceable provision were notcontained in the Plan.

 

Section 10-10                         GoverningLaw. The Plan shall be construed in accordance with and governed by thelaws of the State of Texas, without reference to the principles of conflict oflaws.

 

Section 10-11                         Headings.Headings are inserted in this Plan for convenience of reference only and are tobe ignored in the construction of the provisions of the Plan.

 

Section 10-12                         Gender,Singular and Plural. All pronouns and any variations thereof shall bedeemed to refer to the masculine, feminine, or neuter, as the identity of theperson or persons may require. As the context may require, the singular mayread as the plural and the plural as the singular.

 

Section 10-13                         Notice.Any notice required or permitted under the Plan shall be sufficient if inwriting and hand delivered or sent by registered or certified mail. Such noticeshall be deemed given as of the date of delivery or, if delivery is made bymail, as of the date shown on the postmark on the receipt for registration orcertification. Notice to a Participant or Beneficiary shall be directed to theindividual’s last known address in the Employer’s records.

 

Section 10-14                         MissingParticipants. In the event that the Committee is unable to locate aParticipant or Beneficiary within two years following the date the Participantwas to commence receiving payment, the entire amount credited to theParticipant’s Defined Contribution Account shall be forfeited. If, after suchforfeiture, the Participant or Beneficiary later claims such benefit, suchbenefit shall be reinstated without interest or earnings from the date paymentwas to commence pursuant to ARTICLE VII above.

 

Section 10-15                         Incapacity.In the event that any amount becomes payable under the Plan to a person who, inthe sole judgment of the Committee, is considered by reason of physical ormental condition to be unable to give a valid receipt therefore, the Committeemay direct that such payment be made to any person found by the Committee, inits sole judgment, to have

 

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assumed the care of suchperson. Any payment made pursuant to such determination shall constitute a fullrelease and discharge of the Committee, the Company and the Employer.

 

Section 10-16                         Section 409A. The Plan is intended to comply withthe applicable requirements of Section 409A of the Code and itscorresponding regulations and related guidance, and shall be administered inaccordance with Section 409A of the Code to the extent Section 409Aof the Code applies to the Plan. Notwithstanding anything in the Plan to thecontrary, distributions from the Plan may only be made in a manner and upon anevent permitted by Section 409A of the Code. To the extent that anyprovision of the Plan would cause a conflict with the requirements of Section 409Aof the Code, or would cause the administration of the Plan to fail to satisfythe requirements of Section 409A of the Code, such provision shall bedeemed null and void to the extent permitted by applicable law.

 

IN WITNESS WHEREOF, theCompany has caused this instrument to be signed in its name and on its behalfby its duly authorized officer, this 10th day of March, 2008.

 

 
|   | THE NEIMAN MARCUS  GROUP, INC. |
|--------|--------------------------------|
|   |                           |
|   |                           |
|   | By:                       | /s/ Marita O’Dea |
|   |                           |   |
|   |                           |   |
|   | Its:                      | Senior Vice President, |
|   |                           | Chief Human Resource Officer |

 

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