EXHIBIT 10.9
THE NEIMAN MARCUS GROUP,
INC.
DEFERRED COMPENSATON PLAN
FOR NON-EMPLOYEE DIRECTORS
Effective January 17, 1997
As Amended and Restated June 8,
1998
THE NEIMAN MARCUS GROUP, INC.
DEFERRED COMPENSATION PLAN
FOR NON-EMPLOYEE DIRECTORS
Table of Contents
ii
THE NEIMAN MARCUS GROUP,
INC.
DEFERRED COMPENSATION
PLAN
FOR NON-EMPLOYEE
DIRECTORS
ARTICLE I
Introduction
1.1. Adoption, amendment and
restatement. The Company adopted the Plan effective
January 17, 1997 to provide a means by which members of the
Board who are not employees of the Company may elect to defer
receipt of designated amounts of Compensation earned in that
capacity. The Plan has been amended and restated effective
June 8, 1998, to provide for non-elective deferred
compensation as set forth in Article 5.
1.2. Status of Plan. The
Plan is intended neither to be a qualified plan within the meaning
of 401(a) of the Internal Revenue Code of 1986, as amended (the
“Code”), nor to constitute a “pension benefit
plan” or a “welfare benefit plan” subject to the
requirements of the Employee Retirement Income Security Act of
1974. The Plan shall be administered and interpreted to the extent
possible in a manner consistent with that intent.
ARTICLE 2
Definitions
Whenever used herein, the following
terms have the meanings set forth below, unless a different meaning
is clearly required by the context:
2.1.
“Account” means, for
each Participant, the account maintained for his or her benefit
under Section 4.2 or 5.1.
2.2.
“Board” means the Board
of Directors of the Company.
2.3.
“Committee” means the
Compensation Committee of the Board.
2.4.
“Common Stock” means the
Common Stock, $.01 par value, of the Company.
2.5.
“Company” means The
Neiman Marcus Group, Inc., a Delaware corporation, and any
successor to all or substantially all of the Company’s assets
or business which assumes the obligations of the
Company.
2.6.
“Compensation” means the
amount of retainer payable for service on the Board, plus any fees
payable for attendance at or participation in a meeting, for
service as Chair or Vice Chair of the Board, or for service on or
as a chair of any committee of the Board, determined without
reduction for any elective deferrals under Article 4.
Notwithstanding the foregoing, Compensation does not include any
Common Stock equivalent units which may be credited pursuant to
Section 5.1, which amounts are not subject to the elective
deferral provisions of Section 4.1.
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2.7.
“Effective Date” means
January 17, 1997.
2.8.
“Market Price” means, as
of any date, the mean of the highest and lowest sales prices of the
Common Stock on such date (or, if no trading shall have occurred on
such date, on the next previous date on which trading shall have
occurred), as reported on the New York Stock Exchange Composite
Tape.
2.9.
“Non-Employee Director”
means a member of the Board who is not an officer or employee of
the Company or Harcourt General, Inc. or any of the subsidiaries of
either the Company or Harcourt General, Inc.
2.10.
“Participant” means any
Non-Employee Director who participates in the Plan as set forth in
Article 3.
2.11.
“Plan” means The Neiman
Marcus Group, Inc. Deferred Compensation Plan for Non-Employee
Directors as set forth herein and all subsequent amendments
hereto.
2.12.
“Plan Year” means the
calendar year.
2.13.
“Unforeseen Emergency”
means a severe financial hardship to a Participant resulting from
illness or accident of the Participant or of a dependent (as
defined in 152(a) of the Code) of the Participant, loss of property
due to casualty, or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of
the Participant.
ARTICLE 3
Participation
3.1.
Commencement of participation. Each
Non-Employee Director shall become a Participant in this Plan upon
the later of (a) the Effective Date or (b) the day on which he or
she becomes a Non-Employee Director.
3.2.
Continuation of participation. An
individual who has become a Participant in the Plan shall continue
to be a Participant so long as he or she remains a Non-Employee
Director, and so long thereafter as any amount is payable to him or
her in accordance with Article 4 or 5.
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ARTICLE 4
Elective
Deferrals
4.1.
Elective deferrals. An
individual who is a Non-Employee Director on January 17, 1997
may elect, by filing a written election with the Committee prior to
February 14, 1997, to defer all or a specified portion of his
or her Compensation for services to be performed on or after such
deferral election. An individual who is a Non-Employee
Director on the first day of any fiscal year of the Company after
the Effective Date may elect to defer all or a specified portion of
his or her Compensation for services to be performed on or after
such date by filing a written election with the Committee before
such date. An individual who has been nominated or elected to
serve as a Non-Employee Director, and who was not a Non-Employee
Director immediately prior to such nomination or election, may
elect before or within thirty (30) days after becoming a
Non-Employee Director to defer all or a specified portion of his or
her Compensation for services to be performed after such deferral
election.
Each deferral election under this
Section 4.1 shall be made on a form approved or prescribed by
the Committee and shall also specify the time and form of
distribution of the amounts deferred and the investment equivalent
alternative described in Section 4.3 to be applied to such
amounts.
An election to defer Compensation
and to specify the time and form of distribution may be revoked or
modified, effective for amounts earned on and after the first day
of any fiscal year of the Company, by an election filed before that
date, but may not otherwise be revoked or modified except as
provided in Section 8.8 in the event of an Unforeseen
Emergency.
4.2.
Accounts. The Committee shall
maintain a bookkeeping account (the “Account”) for each
Participant reflecting elective deferrals made for the
Participant’s benefit under Section 4.1, and the value
of such elective deferrals determined in accordance with
Section 4.3, together with any adjustments hereunder.
Elective deferrals shall be credited to the Account as of the day
such amounts become payable to the Participant. As of each
February 15th, the Committee shall provide the Participant
with a statement of his or her Account as of the end of the
preceding Plan Year.
4.3.
Investment equivalent
alternatives. When a Participant elects to make elective
deferrals in accordance with Section 4.1, he or she shall also
elect whether the value of such elective deferrals shall be
determined under the cash-based option or the stock-based option
described below.
(a)
Cash-based option:
Under the cash-based option,
elective deferrals shall accrue interest, to be compounded at the
end of each fiscal quarter of the Company, at a rate equal to the
average of the top rates paid by major New York banks on primary
new issues of three-month negotiable certificates of deposit
(usually on amounts of $1,000,000 or more) as quoted in the Wall
Street Journal on the last business day of the fiscal
quarter.
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(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 secu
