Neiman Marcus 2008 Annual Report Download - page 62

Table of Contents
Inc. Retirement Savings Plan (referred to as the RSP), was offered to all employees, including the named executive officers, as the
primary retirement plan. Benefits and accruals under The Neiman Marcus Group, Inc. Employee Savings Plan (referred to as the
ESP) were frozen as well as benefits and accruals under the Retirement Plan and all future and current employees who were not
already enrolled in the ESP and the Retirement Plan were automatically enrolled in the RSP. "Rule of 65" employees, as described
above, were given a choice to either continue participation in the Retirement Plan and the ESP or freeze what was earned under those
plans through December 31, 2007 and participate in the RSP. Mr. Tansky, Ms. Katz, and Mr. Barnes were "Rule of 65" employees as
of December 31, 2007, and elected to remain in the Retirement Plan and the ESP. Messrs. Skinner and Gold were not eligible to
continue participating in the ESP and amounts in their Retirement Plan were frozen and the balances in their ESP were transferred to
the RSP. The RSP is a tax-qualified defined contribution 401(k) plan that allows participants to contribute up to the limit prescribed
by the Internal Revenue Service on a pre-tax basis. The Company will match 100% of the first 3% and 50% of the next 3% of pay
that is contributed to the RSP after the first year of employment. All employee contributions to the RSP are fully vested upon
contribution. Company matching contributions vest after two years of service.
For those who remain eligible, the ESP is a retirement savings plan that allows participants to contribute up to the limit
prescribed by the Internal Revenue Service on a pre-tax basis (provided, however, that highly compensated employees are limited to
6% of eligible compensation). The Company will match 100% of the first 2% and 25% of the next 4% of pay that is contributed to the
ESP after the first year of employment. All employee contributions to the ESP are fully vested upon contribution. Company
matching contributions vest after three years of service.
Supplemental Retirement Plan and Key Employee Deferred Compensation Plan. U.S. tax laws limit the amount of benefits
that we can provide under our tax-qualified plans. We maintain The Neiman Marcus Group, Inc. Supplemental Executive Retirement
Plan (referred to as the SERP) and the Neiman Marcus Group, Inc. Key Employee Deferred Compensation Plan (referred to as the
KEDC Plan), which are unfunded, nonqualified arrangements intended to provide named executive officers and certain other key
employees with additional benefits, including the benefits that they would have received under the Retirement Plan, 401(k) plan, the
ESP and the RSP if the tax law limitations did not apply and if certain other items of compensation could be included in calculation of
benefits under our tax-qualified plans. Prior to 2008, executive, administrative and professional employees (other than those
employed as salespersons) with an annual base salary at least equal to a minimum established by the Company were eligible to
participate in the SERP. Similar to the Retirement Plan, effective December 31, 2007, eligibility and benefit accruals under the SERP
were frozen for all participants except for those "Rule of 65" employees who elected to continue participating in the Retirement Plan.
Each SERP participant accrues a benefit for amounts in excess of those provided under the Retirement Plan. SERP related benefits
are more fully described under "Pension Benefits" on page 63.
Participation in the KEDC Plan is limited to employees whose base salary is in excess of $300,000 and meet other stated
criteria. Amounts in excess of those benefits provided under the 401(K) plans are credited to the account balances of each KEDC Plan
participant. KEDC Plan benefits are more fully described under "Nonqualified Deferred Compensation" on page 64.
Matching Gift Program. All employees, including the named executive officers, may participate in our matching gift
program. Under the program, we will match charitable contributions by employees up to a maximum of $2,000 per qualifying
organization on a two-for-one basis in each calendar year. For any contribution made to a qualifying organization in which the
employee has an active involvement (as evidenced by service on the organization's governing body or in one of its working
committees), the basis of our matching contribution may, upon application by the employee, be increased to a level greater than two-
for-one.
Perquisites. We provide perquisites and other personal benefits that we believe are reasonable and consistent with the nature
of individual responsibilities in order to provide a competitive level of total compensation to our executives. We believe the level of
perquisites is within an acceptable range of what is offered by a group of industry related companies. The Compensation Committee
believes that these benefits are aligned with the Company's desire to attract and retain superior management talent for the benefit of all
stockholders. The value of these benefits to the named executive officers is set forth in the Summary Compensation Table under the
column "All Other Compensation" and detail about each benefit is set forth in a table following the Summary Compensation Table.
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