Neiman Marcus 2004 Annual Report Download - page 71

five percent, payable quarterly. Under the terms of the Loan Plan, loans become due and payable seven months following cessation of employment with us.
Effective July 30, 2002, the Loan Plan was terminated and we have not made any other loans to any executive officer or director under the Loan Plan, nor will
the existing loan be modified in any material way. Interest on the outstanding loan to Mr. Tansky will continue to accrue and be payable quarterly until the
loan is fully paid. No other executive officer, director or five percent security holder was indebted to us since the beginning of our last fiscal year.
Gary L. Countryman, a director, is Chairman Emeritus of the Liberty Mutual Group. Liberty Mutual Company, a subsidiary of Liberty Mutual Group,
underwrites some of our insurance policies. These insurance policies contain terms which, in the judgment of management, are no less favorable than could be
obtained from other insurance companies. During fiscal year 2005, the amount paid by the Company to Liberty Mutual Company did not exceed two percent
of their consolidated gross revenues reported for the fiscal year ended December 31, 2004. As a result, the Board determined that the foregoing relationship
did not impair Mr. Countryman's independence as a director.
Compliance with New York Stock Exchange Listing Standards
Board of Directors. The Board of Directors has 11 members. The qualifications of all candidates for election to the Board of Directors shall be
considered at the time the candidate is recommended for election by the Nominating and Corporate Governance Committee. The Company seeks individuals
to serve as directors with the highest personal and professional character and integrity who have outstanding records of accomplishment in diverse fields of
endeavor and who have obtained leadership positions in their chosen business or profession. These persons should have demonstrated exceptional ability and
judgment and have substantial expertise and experience in areas relevant to the Company's operations.
Board Independence. The Board has affirmatively determined that Matina S. Horner, Paula Stern, Gary L. Countryman, Carl Sewell, John R. Cook,
Vincent M. O'Reilly, and Walter J. Salmon qualify as "independent" in accordance with the published listing requirements of the New York Stock Exchange
(the "NYSE"). In addition, the Board has determined as to each independent director that no material relationships exist which, in the opinion of the Board,
would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Each independent director has met the categorical
independence standards set by the Board.
Executive Sessions of Non-Management and Independent Directors. The non-management directors shall meet in executive session, without any
member of management being present, at each regularly scheduled meeting of the Board. Independent directors shall meet in executive session at least once a
year, or more often, as appropriate. The Chairperson of the Nominating and Corporate Governance Committee shall act as presiding director at each executive
session.
Communications with the Board. A toll-free number, 866-493-1854, has been established whereby shareholders and other interested parties may
communicate with the full Board, members of the Audit Committee, the non-management members of the Board, or any individual director, including the
presiding director. Such communications should indicate to whom they are addressed. Any comments received that relate to accounting, internal accounting
controls or auditing matters will be referred to the Chairman of the Audit Committee unless the communication is otherwise addressed. Parties may
communicate anonymously and/or confidentially if they desire. All communications received will be collected by the General Counsel of the Company and
forwarded to the appropriate director or directors.
Website Access. The charters of the Audit Committee, the Compensation Committee, and the Nominating and Corporate Governance Committee as
well as our Corporate Governance Guidelines,
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