**EXHIBIT 10.32**

 

**AMENDMENT TO THE**

**CONFIDENTIALITY, NON-COMPETITION AND**

**TERMINATION BENEFITS AGREEMENT**

 

This Amendment to theConfidentiality, Non-Competition and Termination Benefits Agreement (the “Amendment”)is made effective as of January 1, 2009, by and between James J. Gold (“Executive”)and Bergdorf Goodman, Inc., a New York corporation (“Bergdorf”) and awholly owned subsidiary of The Neiman Marcus Group, Inc., a Delawarecorporation (“NMG”).

 

W I T N E S S E T H:

 

WHEREAS, the Executive andBergdorf entered into the Confidentiality, Non-Competition and TerminationBenefits Agreement (the “Agreement”) effective as of May 3, 2004, and

 

WHEREAS, the Executive andBergdorf now desire to amend the Agreement for compliance with Internal RevenueCode Section 409A and the Treasury Regulations thereunder;

 

NOW, THEREFORE, pursuant tothe authority reserved in Paragraph 7, the Agreement is amended as follows:

 

1.             Paragraph 1(a) of the Agreement ishereby amended and restated in its entirety as follows:

 

(a)  While Executive is employed at-will by Bergdorf, if (i) Bergdorfterminates Executive’s employment for any reason other than for “Cause,” his “Total Disability,” or his death, or Executive terminates his employment for “Good Reason” in accordancewith Paragraph 1(e), and (ii) the Executive’s termination of employmentalso constitutes a separation from service under Treasury Regulation Section 1.409A-1(h),then, subject to Paragraphs 1(c) and 1(d) below, Bergdorf shallprovide Executive with benefits (“Termination Benefits”) consisting of:

 

(1) an amount equivalent to 1.5 times histhen-current annual base salary, less required withholding, which amount wouldbe paid over an 18-month period(hereinafter, the “Salary Continuance Period”) in regular, bi-weekly installmentsbeginning with the first payroll period immediately following such termination;and

 

(2) if, at the time of his termination,Executive participates in a group medical insurance plan offered by Bergdorfand Executive is eligible for and elects to receive continued coverage undersuch plan in accordance with the Consolidated Omnibus Budget Reconciliation Actof 1985 (“COBRA”) or any successor law, Bergdorf will reimburse Executiveduring the Salary Continuance Period or, if shorter, the period of such actualCOBRA continuation coverage, for the total amount of the monthly COBRA medicalinsurance premiums actually paid by Executive for such continued medicalinsurance benefits.

 

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2.             Paragraph 1(b) of the Agreement ishereby amended and restated in its entirety as follows:

 

(b) Bergdorf shall require any successor or assignee (whether direct or indirect,by purchase, merger, consolidation, or otherwise) to all or substantially allthe business and/or assets of Bergdorf, by agreement in writing in form andsubstance reasonably satisfactory to Executive, expressly, absolutely, andunconditionally to assume and agree to perform this Agreement in the samemanner and to the same extent that Bergdorf would be required to perform it ifno such succession or assignment had taken place.  If Bergdorf fails to obtain such agreement bythe effective time of any such succession or assignment and if such failureconstitutes Good Reason then the Termination Benefits to which Executive isentitled upon a termination for Good Reason pursuant to Paragraph 1(a) shallbe the sole remedy of Executive for any failure by Bergdorf to obtain suchagreement.  As used in this Agreement, “Bergdorf”shall include any successor or assignee (whether direct or indirect, bypurchase, merger, consolidation, or otherwise) to all or substantially all thebusiness and/or assets of Bergdorf that executes and delivers the agreementprovided for in this Paragraph 1(b) or that otherwise becomes obligatedunder this Agreement by operation of law.

 

3.             Paragraph 1(d) of the Agreement ishereby amended and restated in its entirety as follows:

 

(d) If Executive is arrested or indicted for any felony, other serious criminaloffense, or any violation of federal or state securities laws, or has any civilenforcement action brought against him by any regulatory agency, for actions oromissions related to his employment withBergdorf, or if Bergdorf reasonably determines in its sole judgment thatExecutive has committed any act or omission that would have entitled Bergdorfto terminate his employment for Cause,whether such act or omission was committed during his employment with Bergdorf or during the Salary ContinuancePeriod, then (1) Bergdorf’s obligation to provide Termination Benefitsshall immediately end, and (2) Executive shall repay to Bergdorf anyamounts paid to him as TerminationBenefits within 30 days after a written request to do so by Bergdorf.

 

4.             The Agreement is hereby amended by theaddition of the following as Paragraph 1(e):

 

(e) The Executive may terminate hisemployment for Good Reason.  To exercise his right to terminate for Good Reason, theExecutive must provide written notice to Bergdorf of his belief that Good Reason exists within 90 days of the initial existenceof the circumstance(s) believed to constitute Good Reason, and such noticeshall describe the circumstance(s) believed to constitute GoodReason.  If such circumstance(s) mayreasonably be remedied, Bergdorf shall have 30 days to effect that remedy.  If not remedied within that 30-day period,the Executive may terminate his employment for Good Reason by delivery ofwritten notice to Bergdorf; provided, however, that a termination for GoodReason must occur no later than 180 days after the initial existence of thecircumstance(s) believed to constitute Good Reason; otherwise, theExecutive is deemed to have accepted the circumstance(s) that may havegiven rise to the existence of Good Reason.

 

5.             The Agreement is hereby amended by theaddition of the following as Paragraph 10:

 

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10.           In the event Executive is determined to be aspecified employee (as defined by Treasury Regulation Section 1.409A-1(i))by Bergdorf upon Executive’s separation from service (as defined by TreasuryRegulation Section 1.409A-1(h)), any payment hereunder subject to Code Section 409Awhich is payable upon such separation from service may not be made before thedate that is six months after the date of the separation from service (or, ifearlier than the end of the six-month period, the date of death ofExecutive).  Any such payments which aredue during the six-month period shall be accumulated and paid on the first dayof the seventh month following the date of Executive’s separation from service.

 

6.             Appendix A to the Agreement is hereby amendedby the addition of the following as Paragraph 6:

 

6.             “Good Reason” shall mean any of the followingactions if taken without Executive’s prior consent:  (i) a material diminution in Executive’sbase compensation; (ii) a material diminution in Executive’s authority,duties, or responsibilities; (iii) a material diminution in the authority,duties, or responsibilities of the officer of Bergdorf to whom Executive isrequired to report; (iv) a material diminution in the budget over whichExecutive retains authority; (v) a material change in the geographiclocation at which Executive must perform services; and (vi) any otheraction or inaction that constitutes a material breach by Bergdorf of thisAgreement.

 

7.             Except as otherwise specifically set forthherein, all other terms and conditions of the Agreement shall remain in fullforce and effect.

 

IN WITNESS WHEREOF, theparties hereto have caused this Amendment to be executed on this the 10th day of December, 2008.

 
| ** ** | ** ** | **BERGDORF GOODMAN, INC.** |
|------------|------------|----------------------------|
|       |       |                       |
|       |       |                       |
|       | By:        |                       | /s/  Nelson A.  Bangs |
|       | Name:      | Nelson A. Bangs            |
|       | Title:     | Vice President             |
|       |       |                       |
|       |       |                       |
| ** ** | ** ** | **EXECUTIVE**              |
| ** ** | ** ** | ** **                 |
|       |       |                       | /s/  James J.  Gold |
|       |       | James J. Gold              |

 

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