Neiman Marcus 2014 Annual Report Download - page 64

Table of Contents
director of various companies in the retail industry controlled by private equity sponsors led to the conclusion that he should serve as a member of the Parent
Board.
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As of August 1, 2015, the Parent Board was composed of nine directors. Each director serves for annual terms until his or her successor is elected and
qualified, or until such director’s earlier death, resignation or removal.
Pursuant to the terms of the Stockholders Agreement, dated October 25, 2013, by and among Parent, our Sponsors and the other security holders
party thereto (the Stockholders Agreement), each of our Sponsors has the right to designate three members of the Parent Board and to jointly designate two
independent members of the Parent Board, in each case for so long as they or their respective affiliates own at least 25% of the shares of Parent’s Class A
Common Stock, par value $0.001 per share (Class A Common Stock) that they owned as of the closing of the Acquisition. The Stockholders Agreement also
provides for the election of the current chief executive officer of Parent to the Parent Board and, to the extent permitted by applicable laws and regulations
and subject to certain exceptions, for equal representation on the boards of directors of our subsidiaries with respect to directors designated by our Sponsors
and the appointment of at least one of the directors designated by each Sponsor to each committee of the Parent Board. For additional detail regarding the
Stockholders Agreement, see “Certain Relationships and Related Transactions, and Director Independence—Stockholders Agreement.”
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The Parent Board has the authority to appoint committees and, subject to certain exceptions, to delegate to such committees the power and authority
of the Parent Board to manage the business and affairs of Parent, and in turn, Holdings and the Company, and perform administrative functions. The
composition and responsibilities of each such standing committee are described below. Members will serve on these committees until their resignation or
until otherwise determined by the Parent Board.
The Parent Board has established an Audit Committee and Compensation Committee.
Audit Committee
The members of the Audit Committee are Messrs. Stein and Nishi. The Audit Committee assists the Parent Board in its oversight of (i) our financial
statements, (ii) our compliance with legal and regulatory requirements, (iii) any independent registered public accounting firm engaged by us and (iv) our
internal audit function.
The Parent Board has not affirmatively determined whether any of the members of the Audit Committee meet the criteria set forth in the rules and
regulations of the SEC for an “audit committee financial expert” because at the present time the Parent Board believes that the members of the Audit
Committee are collectively capable of analyzing and evaluating our financial statements and understanding the internal controls and procedures for financial
reporting.
Compensation Committee
The members of the Compensation Committee are Mr. Feeney and Mr. Kaplan, who serves as its Chairman. The Compensation Committee (i)
oversees the discharge of the responsibilities of the Parent Board relating to compensation of our officers and other key employees, (ii) reviews and evaluates
our overall compensation philosophy, (iii) oversees our equity-based incentive plans and other compensation and benefit plans and (iv) prepares the
compensation committee report on executive compensation included in this report.
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We have adopted a Code of Ethics and Conduct, which is applicable to all our directors, officers and employees. We have also adopted a Code of
Ethics for Financial Professionals that applies to all professionals serving in a finance, accounting, treasury, tax or investor relations role throughout our
organization, including the Chief Executive Officer, the Chief Financial Officer and the Chief Accounting Officer. Both the Code of Ethics and Conduct and
the Code of Ethics for Financial Professionals may be accessed through our website at www.neimanmarcusgroup.com under the “Investor Information—
Corporate Governance—Governance Documents” section.
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