Neiman Marcus 2003 Annual Report Download - page 188

(b) Stock-based option:
Under the stock-based option, elective deferrals will be converted hypothetically into Common Stock equivalent
units. The number of such units shall be determined by dividing the amount of elective deferrals in each fiscal
quarter by the average of the Market Prices of the Common Stock during the last five (5) trading days of such fiscal
quarter. Units will be calculated to the nearest thousandth. On each dividend payment date, if any, for the Common
Stock dividend equivalents in the form of additional units representing Common Stock will be credited to the
Participant's Account equal to (i) the per-share cash dividend divided by the Market Price of Common Stock on the
dividend payment date, multiplied by (ii) the number of such units reflected in such Account on the day before the
dividend payment date. At the end of the period of deferral elected by the Participant, the Common Stock
equivalent units will be valued for payment by multiplying the applicable number of units by the average of the
Market Prices of Common Stock during the last ten (10) trading days before the date on which the value of the
elective deferrals is to be paid or begin to be paid. If the outstanding shares of Common Stock are increased,
decreased or exchanged for a different number or kind of shares or other securities, or if additional shares or new or
different shares or other securities are distributed with respect to such shares of Common Stock or other securities
through merger, consolidation, sale of all or substantially all the property of the Company, reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock split or other distribution with respect to
such shares of Common Stock or other securities, appropriate adjustments will be made by the Company in the
number of Common Stock equivalent units credited to a Participant's Account.
4.4. Time of payment. When a Participant elects to make elective deferrals in accordance with Section 4.1, the
Participant shall also elect whether the value of the elective deferrals shall be paid, or begin to be paid, (a) at a specified date at least
twenty-four months in the future (which date shall be the last day of a fiscal quarter) or (b) upon termination of his or her service as a
member of the Board. If alternative (a) under this Section 4.4 is elected, payment will be made or will commence on the date
specified. If alternative (b) under this Section 4.4 is elected, payment will be made or will commence at the end of the fiscal quarter in
which the Participant's service as a member of the Board terminates. The foregoing election shall be made on a form approved or
prescribed by the Committee.
Payment of a Participant's Account shall be made in accordance with the Participant's elections under this Section 4.4 and
Section 4.5. Each Participant's Account shall be reduced by the amount of any payment made to or on behalf of the Participant
(including interest paid with respect to such payment) as of the date such payment is made.
4