Neiman Marcus 2012 Annual Report Download - page 58

Table of Contents
Executive Officer Compensation
Process for Evaluating Executive Officer Performance
Role of the Compensation Committee. The Compensation Committee is responsible for determining the compensation of our named executive
officers and for establishing, implementing and monitoring adherence to our executive compensation philosophy. The Compensation Committee charter
authorizes the committee to retain and terminate compensation consultants to provide advice with respect to compensation of the named executive officers. The
Compensation Committee is further authorized to approve the fees the Company will pay, and terms of engagement of, any consultant it may retain.
The Compensation Committee considers input from our CEO and compensation consultants in making determinations regarding our executive
compensation program and the individual contribution of each of our named executive officers. The CEO does not play a role in decisions affecting her own
compensation. The CEO’s performance and compensation are reviewed and determined solely by the Compensation Committee.
In developing and reviewing the executive incentive programs, the Compensation Committee considers the business risks inherent in program designs
to ensure that they do not incentivize executives to take unacceptable levels of business risk for the purpose of increasing their incentive plan awards. The
Committee intends for the plan design to be conservative in this respect and that the compensation components provide appropriate checks and balances to
encourage executive incentives to be consistent with the interests of the Principal Stockholders. The Compensation Committee believes that the mix of
compensation components used in the determination of our named executive officers’ total compensation does not encourage our named executive officers to
take undesirable risks relating to the business. For further information, see “Risk Assessment of Compensation Policies and Programs” above.
Role of Management. As part of our annual planning process, the CEO, with assistance from external consultants, develops and recommends a
compensation program for all executive officers. Based on performance assessments, the CEO attends a meeting of the Compensation Committee held for the
purpose of considering each individual executive’s annual compensation and recommends the base salary and any incentive bonus awards or long-term
incentive awards, if applicable, for each of the executive officers, including the named executive officers. The CEO does not participate in the portion of the
Compensation Committee meeting during which her own compensation is discussed and does not provide recommendations with respect to her own
compensation package.
Role of the Compensation Consultants. The Compensation Committee generally retains services of compensation consultants for limited
purposes. Management retains an independent compensation consultant, Haigh & Company, to provide comparative market data regarding executive
compensation to assist the Compensation Committee in establishing reference points for the base salary, annual incentive, and long-term incentive components
of our compensation package. They also provide information regarding general market trends in compensation, compensation practices of other retail
companies, and regulatory and compliance developments. The fees paid to Haigh & Company for their services in fiscal year 2013 did not exceed $120,000.
Haigh & Company has no other affiliations with, and provides no other services to, us.
2013 Executive Officer Compensation
Ultimately, our named executive officers’ total compensation is based on the level of performance of the Company and/or the Company’s business
unit or division. The Compensation Committee uses its discretion in making decisions on the overall compensation packages of our executive officers based
on current market conditions, business trends, and overall Company performance.
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