Exhibit 10.30


 


THE NEIMAN MARCUS
GROUP, INC.


 


KEY EMPLOYEE
DEFERRED COMPENSATION PLAN


 


(Amended and
Restated Effective January 1, 2008)


 





















 


TABLE OF CONTENTS


 


	
  ARTICLE 1. INTRODUCTION

  	
  1

  
	
   

  	
   

  
	
  1.1

  	
  Purpose of Plan

  	
  1

  
	
  1.2

  	
  Status of Plan

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2. DEFINITIONS

  	
  1

  
	
   

  	
   

  
	
  2.1

  	
  “Account”

  	
  1

  
	
  2.2

  	
  “Affiliate”

  	
  1

  
	
  2.3

  	
  “Base Pay”

  	
  1

  
	
  2.4

  	
  “Bonus”

  	
  2

  
	
  2.5

  	
  “Cause”

  	
  2

  
	
  2.6

  	
  “Change in Control”

  	
  3

  
	
  2.7

  	
  “Code”

  	
  5

  
	
  2.8

  	
  “Committee”

  	
  5

  
	
  2.9

  	
  “Company”

  	
  5

  
	
  2.10

  	
  “Compensation”

  	
  5

  
	
  2.11

  	
  “Effective Date”

  	
  5

  
	
  2.12

  	
  “Elective Deferral”

  	
  5

  
	
  2.13

  	
  “Eligible Employee”

  	
  5

  
	
  2.14

  	
  “Employer”

  	
  6

  
	
  2.15

  	
  “ERISA”

  	
  6

  
	
  2.16

  	
  “Fiscal Year”

  	
  6

  
	
  2.17

  	
  “Matching Deferral”

  	
  6

  
	
  2.18

  	
  “Maximum 401(k) Plan Deferral”

  	
  6

  
	
  2.19

  	
  “Maximum 401(k) Plan Match”

  	
  6

  
	
  2.20

  	
  “Participant”

  	
  7

  
	
  2.21

  	
  “Plan”

  	
  7

  
	
  2.22

  	
  “Plan Year”

  	
  7

  
	
  2.23

  	
  “Retirement”

  	
  7

  
	
  2.24

  	
  “Retirement Savings Plan”

  	
  7

  
	
  2.25

  	
  “Savings Plan”

  	
  7

  
	
  2.26

  	
  “Separation from Service”

  	
  7

  
	
  2.27

  	
  “Year of Service”

  	
  10

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3. PARTICIPATION

  	
  11

  
	
   

  	
   

  
	
  3.1

  	
  Commencement of Participation

  	
  11

  
	
  3.2

  	
  Continued Participation

  	
  11

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4. DEFERRALS AND CREDITS

  	
  11

  
	
   

  	
   

  
	
  4.1

  	
  Elective Deferrals

  	
  11

  
	
  4.2

  	
  Matching Deferrals

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5. ACCOUNTS; INTEREST; PAYMENT;
  VESTING

  	
  15

  
	
   

  	
   

  
	
  5.1

  	
  Accounts

  	
  15

  



 


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  5.2

  	
  Interest

  	
  16

  
	
  5.3

  	
  Payments

  	
  16

  
	
  5.4

  	
  Vesting

  	
  16

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6. PAYMENTS

  	
  17

  
	
   

  	
   

  
	
  6.1

  	
  Election of Time and Form of Payment

  	
  17

  
	
  6.2

  	
  Retirement and Other Separation from Service

  	
  19

  
	
  6.3

  	
  Death

  	
  19

  
	
  6.4

  	
  Change in Control

  	
  19

  
	
  6.5

  	
  Hardship Distributions

  	
  20

  
	
  6.6

  	
  Changes in Time and Form of Payment

  	
  21

  
	
  6.7

  	
  Withholding

  	
  22

  
	
  6.8

  	
  Specified Employees

  	
  22

  
	
  6.9

  	
  409A Income Inclusion

  	
  22

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7. COMMITTEE

  	
  23

  
	
   

  	
   

  
	
  7.1

  	
  Plan Administration and Interpretation

  	
  23

  
	
  7.2

  	
  Powers, Duties, Procedures, Etc.

  	
  23

  
	
  7.3

  	
  Information

  	
  24

  
	
  7.4

  	
  Indemnification of Committee

  	
  24

  
	
  7.5

  	
  Claims Procedure

  	
  25

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8. AMENDMENT AND TERMINATION

  	
  26

  
	
   

  	
   

  
	
  8.1

  	
  Amendments

  	
  26

  
	
  8.2

  	
  Termination of Plan

  	
  26

  
	
  8.3

  	
  Existing Rights

  	
  26

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9. MISCELLANEOUS

  	
  27

  
	
   

  	
   

  
	
  9.1

  	
  No Funding; Source of Payments

  	
  27

  
	
  9.2

  	
  Nonassignability; Domestic Relations Order

  	
  27

  
	
  9.3

  	
  Limitation of Participants’ Rights

  	
  27

  
	
  9.4

  	
  Participants Bound

  	
  28

  
	
  9.5

  	
  Receipt and Release

  	
  28

  
	
  9.6

  	
  Governing Law

  	
  28

  
	
  9.7

  	
  No Guarantee of Tax Consequences

  	
  28

  
	
  9.8

  	
  Adoption by Other Employers

  	
  29

  
	
  9.9

  	
  Headings and Subheadings

  	
  29

  



 


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THE NEIMAN MARCUS
GROUP, INC.

KEY EMPLOYEE DEFERRED COMPENSATION PLAN


 


(Amended and
Restated Effective January 1, 2008)


 


ARTICLE 1.  INTRODUCTION


 


1.1           Purpose
of Plan.  The Employers adopted The
Neiman Marcus Group, Inc. Key Employee Deferred Compensation Plan (the “Plan”)
effective January 1, 2006 as a nonqualified deferred compensation
arrangement to provide a means by which certain eligible employees may defer
Compensation.  The Plan is being amended
and restated effective as of January 1, 2008 to make changes designed to
bring the Plan into compliance with Code Section 409A and to make certain
other changes.


 


1.2           Status
of Plan.  The Plan is intended to be “a
plan which is unfunded and is maintained by an employer primarily for the purpose
of providing deferred compensation for a select group of management or highly
compensated employees” within the meaning of Sections 201(2) and 301(a)(3) of
ERISA and is intended to comply with the requirements of Code Section 409A,
and shall be interpreted and administered in a manner consistent with those
intentions.


 


ARTICLE 2.  DEFINITIONS


 


Wherever 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
established for his or her benefit under Section 5.1.


 


2.2           “Affiliate” means any corporation or organization that
together with an Employer is treated as a single employer under Section 414(b) or
(c) of the Code.


 


2.3           “Base Pay” means the base salary payable by an Employer to
an employee, including amounts that would have been payable to the employee as
base salary but for an 


 





















 


election under Section 125 of the Code, a deferral election under
the Savings Plan or the Retirement Savings Plan, or a deferral election under
this Plan.


 


2.4           “Bonus” means an annual cash bonus payable by an Employer to
an employee, including any portion of such a bonus that would have been payable
to the employee but for an election under Section 125 of the Code, a
deferral election under the Savings Plan or the Retirement Savings Plan, or a
deferral election under this Plan, provided, however, that the Committee has
designated such amount as a “Bonus” eligible for an Elective Deferral under
this Plan prior to the deadline for making such election.  Notwithstanding the preceding sentence, the
term “Bonus” shall not include any amount arising from, or paid under or in
connection with a long-term incentive program, or a stock appreciation right,
stock option, restricted stock or stock unit, or other equity-based incentive
award, plan or arrangement.  A “Fiscal Year Bonus” means any Bonus that satisfies the
requirements to be fiscal year compensation within the meaning of Treasury
Regulation Section 1.409A-2(a)(6). 
A “Performance Bonus” means any Bonus that
satisfies the requirements to be performance-based compensation within the
meaning of Treasury Regulation Section 1.409A-1(e).


 


2.5           “Cause” means:


 


(a)  the willful and continued failure
by the Participant to substantially perform duties consistent with the
Participant’s position with the Employer (other than any such failure resulting
from incapacity due to physical or mental illness), after a demand for
substantial performance is delivered to the Participant, and the Participant
has failed to resume substantial performance of his or her duties on a
continuous basis within 14 days of receiving such demand;


 


(b)           the
willful engaging by the Participant in conduct that is demonstrably and
materially injurious to an Employer, monetarily or otherwise; or


 


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(c)           the
Participant’s commission of a felony, commission of a misdemeanor involving
assets of an Employer, or violation of an Employer’s merchandise discount
policy.


 


For purposes of this definition, no act, or failure to act, on the
Participant’s part shall be deemed “willful” unless done, or omitted to be
done, by the Participant not in good faith and without reasonable belief that
his or her action or omission was in the best interest of the Employer.


 


2.6           “Change in Control” shall be deemed to have taken place for
purposes of the Plan upon the occurrence of any of the following events after
the Effective Date: (i) any sale, lease, exchange or other transfer (in
one transaction or a series of related transactions) of all or substantially
all of the assets of the Company on a consolidated basis to any Person or group
of related persons for purposes of Section 13(d) of the Securities
Exchange Act of 1934 (a “Group”), together with any CIC Affiliates thereof
other than to a Majority Stockholder; (ii) the approval by the holders of
the outstanding voting power of the Company of any plan or proposal for the
liquidation or dissolution of the Company; (iii) (A) any Person or
Group (other than the Majority Stockholder) shall become the beneficial owner
(within the meaning of Section 13(d) of the Exchange Act), directly
or indirectly, of Common Stock representing more than 40% of the aggregate
outstanding voting power of the Company and such Person or Group actually has
the power to vote such Common Stock in any such election and (B) the
Majority Stockholder beneficially owns (within the meaning of Section 13(d) of
the Securities Exchange Act of 1934), directly or indirectly, in the aggregate
a lesser percentage of the voting power of the Company than such other Person
or Group; (iv) the replacement of a majority of the Board of Directors of
the Company over a two-year period from the directors who constituted the Board
of Directors of the Company at the beginning of such period, and such
replacement shall not have been approved by a vote of at least a majority of
the Board of Directors of the Company then still in 


 


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office who either were members of such Board of Directors at the
beginning of such period or whose election as a member of such Board of
Directors was previously so approved or who were nominated by, or designees of,
a Majority Stockholder; or (v) consummation of a merger or consolidation
of the Company with another entity in which holders of the Common Stock of the
Company immediately prior to the consummation of the transaction hold, directly
or indirectly, immediately following the consummation of the transaction, less
than 50% of the common equity interest in the surviving corporation in such
transaction and the Majority Stockholder does not hold a sufficient amount of
voting power (or similar securities) to elect a majority of the surviving
entity’s board of directors.


 


For purposes of this Section 2.6 only, the following terms shall
have the following meanings:


 


(a)           “CIC Affiliate” shall mean, with respect to any entity, any
other corporation, organization, association, partnership, sole proprietorship
or other type of entity, whether incorporated or unincorporated, directly or
indirectly controlling or controlled by or under direct or indirect common
control with such entity.


 


(b)           “Common Stock” shall mean the common stock of the Company,
$0.01 par value per share.


 


(c)           “Company” shall mean Neiman Marcus, Inc. or The Neiman
Marcus Group, Inc.


 


(d)           “Majority Stockholder” shall mean, collectively or
individually as the context requires, Newton Holding, LLC, TPG Newton III, LLC, TPG Partners IV, L.P., TPG Newton
Co-Invest I, LLC, Warburg Pincus Private Equity VIII, L.P., Warburg Pincus Netherlands Private Equity
VIII C.V. I, Warburg Pincus Germany Private Equity VIII K.G , Warburg Pincus
Private Equity IX, L.P and/or their respective CIC Affiliates.


 


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(e)           “Person” shall mean an individual, partnership, corporation,
limited liability company, unincorporated organization, trust or joint venture,
or a governmental agency or political subdivision thereof.


 


2.7           “Code” means the Internal Revenue Code of 1986, as amended
from time to time.  Reference to any
section or subsection of the Code includes reference to any comparable or
succeeding provisions of any legislation which amends, supplements or replaces
such section or subsection.  Similarly,
reference to any Treasury Regulation includes reference to any succeeding
provisions of any regulation or other applicable guidance that amends,
supplements or replaces such regulation.


 


2.8           “Committee” means The Neiman Marcus Group, Inc.
Employee Benefits Committee or any successor committee appointed by the Board
of Directors of The Neiman Marcus Group, Inc. or its delegate.


 


2.9           “Company” means The Neiman Marcus Group, Inc., a
Delaware corporation, and any successor, including a successor to all or
substantially all of the Company’s assets or business which assumes the
obligations of the Company with regard to the Plan.


 


2.10         “Compensation” means Base Pay and any Bonus payable by an
Employer to an employee.


 


2.11         “Effective Date” means January 1, 2006.


 


2.12         “Elective Deferral” means the portion of Compensation which
is deferred by a Participant under Section 4.1.


 


2.13         “Eligible Employee”           means each employee of an Employer who was eligible to
participate in the Plan as of January 1, 2007.  No other persons shall become Eligible
Employees and in the event of an Eligible Employee’s Separation from Service
after January 1, 2007, such Eligible Employee shall not again become an
Eligible Employee hereunder.  The
Committee in


 


5





















 


its discretion may withdraw an employee’s
status as an Eligible Employee at any time and for any reason effective with
respect to any subsequent Plan Year.


 


2.14         “Employer”
means the Company and any Affiliate that adopts the Plan with the consent of
the Company as provided in Section 9.8.


 


2.15         “ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time.  Reference to any section or
subsection of ERISA includes reference to any comparable or succeeding
provisions of any legislation which amends, supplements or replaces such
section or subsection.


 


2.16         “Fiscal Year” means the fiscal year of the Company.


 


2.17         “Matching Deferral” means a deferral made for the benefit of
a Participant under Section 4.2.


 


2.18         “Maximum 401(k) Plan Deferral” means a Participant’s
maximum permissible elective deferral under the Savings Plan or the Retirement
Savings Plan, as applicable, at the time in question assuming the maximum
permissible elective deferrals have been made under the Savings Plan or
Retirement Savings Plan, as applicable, for prior periods during such Plan
Year, regardless of whether the Participant actually made any such elective
deferrals.  The determination of whether
the Savings Plan or the Retirement Savings Plan is applicable to a Participant
for this purpose for a particular Plan Year shall be by reference to the plan
in which the Participant is eligible to participate as of the beginning of said
Plan Year.


 


2.19         “Maximum 401(k) Plan Match” means a Participant’s
maximum permissible matching contribution under the Savings Plan or the
Retirement Savings Plan, as applicable, at the time in question and assuming
the maximum permissible elective deferrals have been made under the Savings
Plan or the Retirement Savings Plan, as applicable, for prior periods during
such Plan Year, regardless of whether the Participant actually made any such
elective deferrals.  


 


6





















 


The determination of whether the Savings Plan or the Retirement Savings
Plan is applicable to a Participant for this purpose shall be by reference to
the plan in which the Participant is eligible to participate as of the
beginning of said Plan Year.


 


2.20         “Participant” means any individual who participates in the
Plan in accordance with Article 3.


 


2.21         “Plan” means The Neiman Marcus Group, Inc. Key Employee
Deferred Compensation Plan, originally effective as of January 1, 2006, as
from time to time in effect and including all amendments hereto.


 


2.22         “Plan Year” means the calendar year.


 


2.23         “Retirement” means Separation from Service on or after the
date the Participant has attained age 55 and reached the fifth anniversary of
the date he or she first performed an hour of service (as defined in Section 2.27
below).


 


2.24         “Retirement Savings Plan” means The Neiman Marcus Group, Inc.
Retirement Savings Plan, as amended from time to time.


 


2.25         “Savings Plan” means The Neiman Marcus Group, Inc.
Employee Savings Plan, as amended from time to time.


 


2.26         “Separation from Service”
means the termination of services provided by a Participant to his or her
Employer (as defined in (c) below), whether voluntary or involuntary, as
determined by the Committee in accordance with Treasury Regulation Section 1.409A-1(h).
 In determining whether a Participant has experienced a Separation from
Service, the following provisions shall apply:


 


(a)           Except as otherwise provided in
subsection (b) below, a Separation from Service will occur when such Participant
has experienced a termination of employment 


 


7





















 


with the Employer.  A Participant will
be considered to have experienced a termination of employment when the facts
and circumstances indicate that the Participant and his or her Employer
reasonably anticipate that either (A) no further services will be
performed for the Employer after a certain date, or (B) that the level of
bona fide services the Participant will perform for the Employer after such date
(whether as an employee or as an independent contractor) will permanently
decrease to no more than 20% of the average level of bona fide services
performed by the Participant (whether as an employee or an independent
contractor) over the immediately preceding 36-month period (or the full period
of services to the Employer if the Participant has been providing services to
the Employer less than 36 months).


 


If a
Participant is on military leave, sick leave, or other bona fide leave of
absence, the employment relationship between the Participant and the Employer
will be treated as continuing, provided that the period of the leave of absence
does not exceed six months, or if longer, so long as the Participant has a
right to reemployment with the Employer under an applicable statute or by
contract.  If the period of a military leave, sick leave, or other bona
fide leave of absence exceeds six months and the Participant does not have a
right to reemployment under an applicable statute or by contract, the employment
relationship will be considered to be terminated for purposes of this Plan as
of the first day immediately following the end of such six-month period.
 In applying the provisions of this paragraph, a leave of absence will be
considered a bona fide leave of absence only if there is a reasonable
expectation that the Participant will return to perform services for the
Employer.


 


8




















 


(b)                                 For a
Participant who provides services to an Employer as both an employee and an
independent contractor, a
Separation from Service generally will not occur until the Participant has
ceased providing services for the Employer as both an employee and an
independent contractor.  Except as
otherwise provided herein, in the case of an independent contractor a
Separation from Service will occur upon the expiration of the contract (or in
the case of more than one contract, all contracts) under which services are
performed for the Employer, provided that the expiration of such contract or
contracts is determined by the Employer to constitute a good-faith and complete
termination of the contractual relationship between the Participant and the
Employer.  If a Participant ceases providing services for an Employer as
an employee and begins providing services for such Employer as an independent
contractor, the Participant will not be considered to have experienced a
Separation from Service until the Participant has ceased providing services for
the Employer in both capacities, as determined in accordance with the
applicable provisions set forth in subsections (a) and (b) of this
Section.


 


Notwithstanding
the foregoing provisions in this subsection, if a  Participant provides services for an Employer
as both an employee and as a member of the board of directors of an Employer,
to the extent permitted by Treasury Regulation 

Section 1.409A-1(h)(5), the services provided by the Participant as a
director will not be taken into account in determining whether the Participant
has experienced a Separation from Service as an employee


 


9

















 


(c)                                  For purposes of
this Section only, “Employer”
means:


 


(i)                                     The entity for
whom the Participant performs services and with respect to which the legally
binding right to the payment of benefits under this Plan arises; and


 


(ii)                                  All other
entities with which the entity described in (i) above would be aggregated
and treated as a single employer under Code Section 414(b) (controlled
group of corporations) and Code Section 414(c) (group of trades or
businesses under common control), as applicable; provided, however, that
an  ownership threshold of 50% shall be
used as a substitute for the 80% minimum ownership threshold that appears in,
and otherwise must be used when applying, the applicable provisions of (1) Code
Section 1563 and the regulations thereunder for determining a controlled
group of corporations under Code Section 414(b), and (2) Treasury
Regulation Section 1.414(c)-2 for determining the trades or businesses
that are under common control under Code Section 414(c).


 


2.27                           “Year
of Service” means completion of the twelve consecutive month
period beginning on the date the employee first performs an hour of service
upon initial employment with an Employer or an Affiliate during which the
employee is continuously employed by an Employer or an Affiliate or, with
respect to an employee who terminates employment prior to completing a Year of
Service, completion of the twelve consecutive month period beginning on the
date the employee first performs an hour of service upon reemployment with an
Employer or an Affiliate during which the employee is continuously employed by
an Employer or an Affiliate.  For this
purpose and for purposes of Section 2.23 defining the term “Retirement”,
an “hour of service” shall mean each hour
for which an employee is paid or entitled to payment for the performance of
duties for an Employer or an Affiliate.


 


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ARTICLE
3.  PARTICIPATION


 


3.1                                 Commencement of
Participation.  An Eligible
Employee shall become a Participant on the effective date of an election to
defer Compensation in accordance with Section 4.1.


 


3.2                                 Continued Participation.  An individual who has become a Participant in
the Plan shall continue to be a Participant so long as any amount remains
credited to his or her Account.


 


ARTICLE
4.  DEFERRALS AND CREDITS


 


4.1                                 Elective Deferrals.


 


(a)                                  Base Pay.  An individual who is or will be an Eligible
Employee as of any January 1 may elect to defer a designated whole
percentage, not to exceed 15 percent, of all Base Pay that is payable to the
individual for services to be performed on or after that date by filing an
election with the Committee prior to that January 1 (or such earlier date
as the Committee may prescribe).  Any
such election shall be irrevocable as of the December 31 immediately prior
to such January 1 (or such earlier date as the Committee may
prescribe).  Notwithstanding the
preceding provisions of this paragraph, a Participant may revoke or otherwise
modify an existing election, or make a new deferral election, effective as of
any January 1 subsequent to the date of such revocation, modified
election, or new election, but only with respect to Base Pay earned
thereafter.  Such revocation,
modification or new election must be delivered to the Committee no later than
the December 31 immediately preceding the effective date of the election
(or such earlier date as the Committee may prescribe).  The same deferral percentage shall apply to
each payment of Base Pay covered by the election.


 


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(b)                                 Bonuses.  An individual who is an Eligible Employee may
elect to defer a designated whole percentage, not to exceed 15 percent, of a
Bonus payable to the individual with respect to a Fiscal Year beginning in a
calendar year after the calendar year in which the election is made, by filing
an irrevocable election with the Committee on or before December 31 of
such calendar year (or such earlier date as the Committee may prescribe).  A Participant may revoke or otherwise modify
an existing election, or make a new deferral election, effective with respect
to a Bonus to be paid for a fiscal year beginning in a calendar year after the
calendar year in which occurs the date of such revocation, modified election,
or new election, by filing an irrevocable election with the Committee on or
before December 31 of such calendar year (or such earlier date as the
Committee may prescribe).


 


(i)                                     Fiscal Year Bonus.  Notwithstanding the preceding provisions of
this subparagraph (b), if permitted by the Committee, an individual who is an
Eligible Employee may elect to defer a designated whole percentage, not to
exceed 15 percent, of any Fiscal Year Bonus payable to the individual with
respect to a Fiscal Year beginning after the date on which the election is made
by filing an irrevocable election with the Committee before the first day of
such Fiscal Year (or such earlier date as the Committee may prescribe).  A Participant may revoke or otherwise modify
an existing election, or make a new deferral election, effective with respect
to a Fiscal Year Bonus to be paid for a Fiscal Year beginning after the date of
such revocation, modified election, or new election, by filing an irrevocable
election with the Committee before the first day of such Fiscal Year (or such
earlier date as the Committee may prescribe).


 


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(ii)                                  Performance Bonus.                                     Notwithstanding the preceding provisions of this
subparagraph (b), if permitted by the Committee, an individual who is an
Eligible Employee may elect to defer a designated whole percentage, not to
exceed 15 percent, of any Performance Bonus for a performance period ending
after the date of the election, by filing an irrevocable election with the
Committee at least six months prior to the end of any such performance period
(or such earlier date as the Committee may prescribe); provided, however, that
the Eligible Employee performs services continuously from the later of the
beginning of the performance period or the date the performance criteria are
established through the date the deferral election is made and that in no event
may a deferral election be made after the Performance Bonus has become readily
ascertainable as determined in accordance with Treasury Regulation Section 1.409A-2(a)(8).  A Participant may revoke or otherwise modify
an existing election, or make a new deferral election, effective with respect
to a Performance Bonus to be paid for any performance period ending more than
six months subsequent to the date of such revocation, modified election, or new
election by filing an irrevocable election with the Committee at least six
months prior to the end of any such performance period (or such earlier date as
the Committee may prescribe); provided, however, that the Eligible Employee
performs services continuously from the later of the beginning of the
performance period or the date the performance criteria are established through
the date of the revocation, modified election, or new election, and that in no
event may such a revocation, modified, election or new election be made after
the Performance Bonus has become readily ascertainable as determined in
accordance with Treasury Regulation Section 1.409A-2(a)(8).


 


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(c)                                  The provisions of paragraphs (a) and (b) to the
contrary notwithstanding, in the event that an employee receives a hardship
distribution from the Savings Plan or the Retirement Savings Plan, as
applicable, at a time at which the Savings Plan or the Retirement Savings Plan,
as applicable, requires the suspension of all elective contributions and deferrals
under all plans maintained by an Employer upon the receipt of such a hardship
withdrawal, then (i) any election to defer Base Pay pursuant to this Plan
in effect at the time of such hardship distribution shall be revoked at the
time the employee receives such distribution and such employee shall not be
eligible to make a new election to defer Base Pay prior to a date that is more
than six months after the date such hardship distribution was made, and (ii) any
election to defer a Bonus pursuant to this Plan shall be revoked at the time
the employee receives such hardship distribution and such employee shall not be
eligible to make a new election to defer a Bonus prior to a date that is more
than six months after the date such hardship distribution was made.


 


(d)                                 Each election under this Section 4.1 shall be made at
the time and in the manner approved or prescribed by the Committee.  The amount of each payment that is deferred
hereunder shall be credited to the Participant’s Account as of the pay date
such amount would otherwise have been paid to the Participant.


 


(e)                                  For purposes of
this Plan, any amount of Base Pay that is payable after the end of the Plan
Year solely for services performed during the final payroll period (described
in Code Section 3401(b)) containing the last day of the Plan Year, where
the amount is payable pursuant to the timing arrangement under which the
Employer normally compensates the Participant for services performed during a
payroll period (described in Code Section 3401(b)), shall be treated as
Base Pay for services performed in the subsequent Plan Year in which the Base
Pay is actually payable.


 


14

















 


4.2                                 Matching
Deferrals.  As of each
pay date on which a credit is made to a Participant’s Account with respect to
such Participant’s election to defer Base Pay or Bonus pursuant to Section 4.1,
such Participant’s Employer shall credit to the Participant’s Account a
Matching Deferral equal to:


 


(a)                                  100% of the sum
of (i) the Participant’s Elective Deferrals for such pay date and (ii) the
Participant’s Maximum 401(k) Plan Deferrals for such pay date, to the
extent that such sum does not exceed the first two percent (2%) of his or her
Compensation for such pay date, plus


 


(b)                                 25% of the sum
of (i) the Participant’s Elective Deferrals for such pay date and (ii) the
Participant’s Maximum 401(k) Plan Deferrals for such pay date, to the
extent that such sum does not exceed the next four percent (4%) of his or her
Compensation for such pay date, minus


 


(c)                                  the Participant’s
Maximum 401(k) Plan Match for such pay date.


 


ARTICLE
5.  ACCOUNTS; INTEREST; PAYMENT; VESTING


 


5.1                                 Accounts.  An Employer shall establish and maintain on
its books an Account for each Participant employed by such Employer.  Each such Account shall be designated by the
name of the Participant for whom it is established.  An Employer shall continue to maintain a
Participant’s Account as long as a positive balance remains credited to such
Account.  A Participant’s Account shall
be credited with the amounts of Elective Deferrals and Matching Deferrals as
provided in the Plan and any adjustments hereunder.  Within 45 days after the end of each calendar
quarter, the Committee shall provide the Participant with a statement of his or
her Account.


 


15

















 


5.2                                 Interest.  As of the last day of each calendar month,
the Committee shall credit each Participant’s Account with interest on the
balance of such Account as of the last day of the preceding calendar month less
any distributions or withdrawals made during such calendar month, plus interest
on any amounts credited to such Account during such calendar month from the
date such amounts were credited.  In
addition, payments under Article 6 shall include interest on the amount of
such payment from the end of the preceding calendar month (except that with
respect to the portion of the payment attributable to an amount credited to the
Account after the end of the preceding calendar month, such portion of the
payment shall include interest only from the later date as of which the amount
was credited to the Account).  The
interest to be credited pursuant to this Section shall be at an annual
rate equal to the prime interest rate published in The Wall Street Journal
on the last business day of the preceding calendar quarter (or, if two or more
such rates are published, the average of such rates).


 


5.3                                 Payments.  Each Participant’s Account shall be reduced
by the amount of any payment made to or on behalf of the Participant under the
Plan as of the date such payment is made.


 


5.4                                 Vesting.  All amounts credited to the Accounts shall be
fully vested and nonforfeitable at all times; provided, however, that in the
event of a Participant’s Separation from Service on account of a termination of
the Participant’s employment by the Employer for Cause, as determined by the
Committee in its discretion, any amounts credited to such Participant’s
Accounts that are attributable to Matching Deferrals made on or after January 1,
2008, along with all interest credits thereon, shall be forfeited.


 


16
















 


ARTICLE 6.  PAYMENTS


 


6.1                                 Election of
Time and Form of Payment.


 


(a)                                  Prior to January 1,
2008 (or such earlier date as the Committee may prescribe), each Participant,
and each individual who is or will be an Eligible Employee as of January 1,
2008 and who makes an election pursuant to Section 4.1(a) or (b) to
commence making Elective Deferrals to the Plan effective as of January 1,
2008, shall elect the time and form of payment from among the options set forth
in this Section for the amounts credited to his or her Account.  Each other individual who is or will be an
Eligible Employee as of January 1, 2008 but is not a Participant and who
does not elect to commence making Elective Deferrals to the Plan effective as
of January 1, 2008 but who makes an initial election subsequent to January 1,
2008 to commence making Elective Deferrals to the Plan pursuant to Section 4.1(a) or
(b) shall, on or before the deadline applicable to his or her initial
election to begin making Elective Deferrals to the Plan, elect the time and
form of payment from among the options set forth in this Section for the
amounts credited to his or her Account.


 


(b)                                 The options available for
the commencement of payment from a Participant’s Account are:


 


(i)                                     the first calendar quarter following the calendar quarter in
which the Participant has a Separation from Service; or


 


(ii)                                  the first calendar quarter of the calendar year immediately
following the calendar year in which the Participant has a Separation from
Service or any of the next nine (9) calendar years thereafter, as
designated by the Participant in such election.


 


17

















 


(c)                                  The options available for
the form of payment from a Participant’s Account are:


 


(i)                                     a single lump
sum payment; or


 


(ii)                                  annual
installments to be paid in the same calendar quarter each year over a period
elected by the Participant up to ten (10) years, the amount of each
installment to equal the balance of his or her Account immediately prior to the
installment divided by the number of installments remaining to be paid.


 


(d)                                 The foregoing elections
shall be made at the time and in the manner approved or prescribed by the
Committee.  Each such election shall be
irrevocable as of the deadline for making such election as provided above,
except as otherwise provided in Section 6.6.  In the event a Participant fails to make a
valid election by the time provided in this Section, the Participant shall be
deemed to have elected options (b)(i) and (c)(i) above.


 


(e)                                  Notwithstanding the
preceding provisions of this Section, if the total amount credited to a
Participant’s Account and any other plans required to be aggregated with this
Plan, including all agreements, methods, programs, or other arrangements with
respect to which deferrals of compensation are treated as having been deferred
under a single nonqualified deferred compensation plan under Treasury
Regulation Section 1.409A-1(c)(2), is less than the applicable dollar
amount under Code Section 402(g)(1)(B), the Committee may require a
distribution of the entire Account in the form of a single lump sum
payment.  Any payment made pursuant to
this provision must result in the termination and liquidation of the entirety
of the Participant’s interest under the Plan and any other plans required to be
aggregated with this Plan, including all agreements, methods, programs, or
other arrangements with respect to which deferrals of


 


18

















 


compensation are treated as having been deferred
under a single nonqualified deferred compensation plan under Treasury
Regulations Section 1.409A-1(c)(2). 
Any determination by the Committee to require a distribution pursuant to
this paragraph must be evidenced in writing no later than the date of any
payment hereunder.


 


6.2                                 Retirement and
Other Separation from Service.  Upon a Participant’s Separation from Service
on account of the Participant’s Retirement, the Participant’s Account shall be
paid to the Participant at the time and in the form elected pursuant to Section 6.1.  Upon a Participant’s Separation from Service
for any reason other than death or Retirement, the Participant’s Account shall
be paid to the Participant in a single lump sum payment during the calendar
quarter immediately following the calendar quarter in which such Separation
from Service occurs.


 


6.3                                 Death.  If a Participant dies prior to the complete
distribution of his or her Account, the balance of the Account shall be paid in
a single lump sum payment in the first calendar quarter following the calendar
quarter in which the Participant died to the Participant’s designated
beneficiary or beneficiaries.  Any
designation of beneficiary shall be made by the Participant in a manner
approved or prescribed by the Committee, shall be effective upon receipt by the
Committee or its designee, and may be changed by the Participant at any
time.  If there is no such designation or
no designated beneficiary survives the Participant, payment shall be made to
the Participant’s estate.


 


6.4                                 Change in Control.  In the event of a Change in Control on or
after January 1, 2006, all amounts credited to a Participant’s Account
shall be distributed in a single lump sum payment at the time of such Change in
Control or within five business days thereafter.  Notwithstanding the preceding, a Change in
Control shall not be deemed to have occurred with respect to the Account of a
Participant for purposes of this Section unless such Change in


 


19

















 


Control also satisfies the requirements for a
permitted distribution event with respect to such Participant for purposes of
Code Section 409A(a)(2)(A)(v).


 


6.5                                 Hardship
Distributions.  If a
Participant encounters an unforeseeable emergency, as determined by the
Committee, the Committee shall direct the Employer maintaining such Participant’s
Account to pay to such Participant and deduct from such Account such portion of
the vested amount then credited to such Account (including, if appropriate, the
entire amount) as the Committee shall determine to be necessary to alleviate
the severe financial hardship of such Participant caused by such unforeseeable
emergency (which may include amounts necessary to pay any Federal, state, or
local income taxes or penalties reasonably anticipated to result from the
distribution).  For this purpose, an “unforeseeable
emergency” shall be a severe financial hardship of the Participant resulting
from an illness or accident of the Participant, the Participant’s spouse, the
Participant’s beneficiary, or the Participant’s dependent (as defined in Code Section 152
without regard to Code Section 152(b)(1), (b)(2), and (d)(1)(B)), loss of
the Participant’s property due to casualty (including the need to rebuild a
home following damage to a home not otherwise covered by insurance), or other
similar extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant, including the need to pay for the
funeral expenses of a spouse, a beneficiary, or a dependent (as defined in Code
Section 152, without regard to Section 152(b)(1), (b)(2), and
(d)(1)(B)).  The circumstances that will
constitute an unforeseeable emergency will depend upon the facts of each case,
but in any case, payment may not be made to the extent that such hardship is or
may be relieved (i) through reimbursement or compensation by insurance or
otherwise or (ii) by liquidation of the Participant’s assets, to the
extent liquidation of such assets would not itself cause severe financial
hardship.  No distribution shall be made
to a Participant pursuant to this Section unless such Participant requests
such a distribution in such manner as the Committee


 


20

















 


may prescribe and provides to the Committee such
information and documentation with respect to his or her unforeseeable
emergency as may be requested by the Committee. 
This Section shall be interpreted in a manner consistent with the
distribution requirements of Section 409A of the Code.


 


6.6                                 Changes in Time
and Form of Payment.  A
Participant may change his or her previous payment elections under Section 6.1
regarding the time at which his or her Account will be paid or begin to be
paid, or the form of such payment, or both, after commencing participation in the
Plan provided that (i) no such change shall be effective until at least 12
months after the date on which such modified election is made, (ii) no
change may be made less than twelve months prior to the date the payment is
scheduled to be paid or, in the case of installment payments elected pursuant
to Section 6.1(c)(ii) (which shall be treated for purposes of this
Plan as a “single payment”), twelve months prior to the date the first amount
was scheduled to be paid, and (iii) the payment made pursuant to any such
subsequent election is deferred for a period of not less than five years from
the date such payment was scheduled to be paid or, in the case of installment
payments elected pursuant to Section 6.1(c)(ii) (which shall be
treated for purposes of this Plan as a “single payment”), five years from the
date the first amount was scheduled to be paid. 
A Participant’s election pursuant to this Section to change his or
her previous payment elections shall be made in the manner prescribed by the
Committee and shall become effective and be deemed to be “made” for purposes of
the above provisions of this Section at the time received by the Committee
or its designee, and shall be irrevocable upon such receipt.  In the case of a payment that is scheduled to
be made during a calendar quarter or such other time period longer than one
day, such payment shall be deemed to be scheduled to be paid for purposes of
this Section as of the first day of such time period.


 


21

















 


6.7                                 Withholding.  There shall be deducted from all amounts paid
under this Plan any taxes and other amounts required to be withheld by any
Federal, state, local or other government. 
The Participant and/or his or her beneficiary (including his or her
estate) shall bear all taxes on amounts paid under this Plan to the extent that
no taxes are withheld, irrespective of whether withholding is required.  The Participant will be required to pay to
his or her Employer the amount of any federal, state or local taxes required by
law to be withheld in connection with the Plan in the event that such
Participant is not being paid by an Employer or amounts being paid by an
Employer to such Participant are insufficient to satisfy any such withholding
obligation.


 


6.8                                 Specified
Employees.  Any
provision of the Plan to the contrary notwithstanding, if a Participant is a “specified
employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code
as of the date of the Participant’s termination of employment with the Employer
and all Affiliates, no distribution shall be made or commence with respect to
such Participant pursuant to this Section sooner than six months from the
date of such Participant’s termination of employment (or, if earlier, the date
of the Participant’s death).  In such
case, all payments that were scheduled to be made within such six-month period
shall be accumulated (with interest as provided in Section 5.2) and paid
in a single lump sum in the calendar quarter following the calendar quarter in
which such six-month period ends. The determination of whether an individual is
a “specified employee” shall be made in accordance with the applicable
regulations and other guidance pursuant to Code Section 409A using the
default provisions in such regulations and other guidance unless another method
permitted pursuant to such regulations and other guidance has been prescribed
for such purpose by the Company for application to all plans subject to Code Section 409A.


 


6.9                                 409A Income
Inclusion.  Any
provision of the Plan to the contrary notwithstanding, although the Plan is
designed to comply in form and operation with the


 


22

















 


requirements of Code Section 409A, in the event
a Participant is required to include in income an amount attributable to the
Plan prior to the payment of any such amount pursuant to this Plan on account
of a violation of Code Section 409A, the amount so required to be included
in income shall be paid to the Participant as soon as practicable.


 


ARTICLE 7.  COMMITTEE


 


7.1                                 Plan
Administration and Interpretation.  The Committee shall oversee the
administration of the Plan.  The
Committee shall have complete control and authority to determine the rights and
benefits and all claims, demands and actions arising out of the provisions of
the Plan of any Participant, beneficiary, deceased Participant, or other person
having or claiming to have any interest under the Plan.  The Committee shall have the exclusive and
discretionary power to interpret the Plan and to decide all matters under the
Plan.  Such interpretation and decision
shall be final, conclusive and binding on all Participants and any person
claiming under or through any Participant, in the absence of clear and
convincing evidence that the Committee acted arbitrarily and capriciously.  Any individual serving on the Committee who
is a Participant will not vote or act on any matter relating solely to himself
or herself.  When making a determination
or calculation, the Committee shall be entitled to rely on information
furnished by a Participant, a beneficiary, or an Employer.  The Committee shall be deemed to be the Plan
administrator with responsibility for complying with any reporting and
disclosure requirements of ERISA.


 


7.2                                 Powers, Duties,
Procedures, Etc.  The
Committee may adopt such rules and regulations as it deems necessary,
desirable or appropriate in administering the Plan so long as they are not
inconsistent with the terms of the Plan. 
Any act which this Plan authorizes or requires the Committee to do may
be done by a majority of the members of the Committee


 


23

















 


acting hereunder; and the action of such majority of
the members of the Committee, expressed from time to time by a vote at a meeting
or in writing without a meeting, shall constitute the action of the Committee
and shall have the same effect for all purposes as if assented to by all of the
members of the Committee at the time in a regular or special meeting.  A dissenting Committee member who, within a
reasonable time after he or she has knowledge of any action or failure to act
by the majority, registers his or her dissent in writing delivered to the other
Committee members and the Company shall not be responsible for any action or failure
to act.  The Committee may elect one of
its members as chairman and it may appoint a secretary who may, but need not
be, a Committee member.  In addition, the
Committee may appoint other agents and representatives, who may but need not be
in the employ of the Employer, to keep its records and assist it in doing other
acts or things to be done or performed by the Committee.  Any such person, corporation or firm so
designated by the Committee may, when so authorized by the Committee, sign in
the name of the Committee all applications and other documents required
hereunder. All usual and reasonable expenses of the Committee including,
without limiting the generality thereof, the reasonable cost of record keeping,
accountants’ fees, consultants’ fees, counsel fees, and administrative costs
shall be paid by the Employers.


 


7.3                                 Information.  To enable the Committee to perform its
functions, the Employers shall supply full and timely information to the
Committee on all matters relating to the compensation of Participants, their
employment, retirement, death, termination of employment, and such other
pertinent facts as the Committee may require.


 


7.4                                 Indemnification
of Committee.  The
Employers agree to indemnify and to defend to the fullest extent permitted by law
any officer or employee who serves as a member of the Committee (including any
such individual who formerly served as a member of the Committee) against all
liabilities, damages, costs and expenses (including attorneys’ fees and amounts
paid in


 


24

















 


settlement of any claims approved by the Company)
occasioned by any act or omission to act in connection with the Plan, if such
act or omission is in good faith.


 


7.5                                 Claims
Procedure.  If any
person (hereinafter called the “Claimant”) feels that he or she is being denied
a benefit to which he or she is entitled under this Plan, such Claimant may
file a written claim for said benefit with the Committee.  Within sixty days following the receipt of
such claim the Committee shall determine and notify the Claimant as to whether
he or she is entitled to such benefit. 
Such notification shall be in writing and, if denying the claim for
benefit, shall set forth the specific reason or reasons for the denial, make
specific reference to the pertinent provisions of this Plan, describe any
additional information necessary for the Claimant to perfect the claim and
explain why the information is necessary, advise the Claimant that he or she
may, within sixty days following the receipt of such notice, in writing request
to appear before the Committee or its designated representative for a hearing
to review such denial, and state that the Claimant has the right to bring a
civil action under Section 502(a) of the Employee Retirement Income
Security Act of 1974, as amended, (“ERISA”) following a denial of the claim on
review.  Any hearing shall be scheduled
at the mutual convenience of the Committee or its designated representative and
the Claimant, and at any such hearing the Claimant and/or his or her duly
authorized representative may examine any relevant documents and present
evidence and arguments to support the granting of the benefit being
claimed.  The final decision of the
Committee with respect to the claim being reviewed shall be made within sixty
days following the hearing thereon, and Committee shall in writing notify the
Claimant of said final decision, again specifying the reasons therefor and the
pertinent provisions of this Plan upon which said final decision is based.  The written notice will also include a
statement that the Claimant is entitled to receive, upon request and free of
charge, reasonable access to, and copies of, all documents and other
information relevant to the claim and a statement that the Claimant has a


 


25

















 


right to bring a civil action under Section 502(a) of
ERISA.  The final decision of the
Committee shall be conclusive and binding upon all parties having or claiming
to have an interest in the matter being reviewed.


 


ARTICLE 8.  AMENDMENT AND TERMINATION


 


8.1                                 Amendments.  The Company shall have the right to amend
this Plan from time to time, subject to Section 8.3.


 


8.2                                 Termination of
Plan.  This Plan is strictly a
voluntary undertaking on the part of the Employers and shall not be deemed to
constitute a contract between the Employers and any employee or a consideration
for, or an inducement or condition of employment for, the performance of
services by any employee.  The Company
reserves the right to terminate this Plan at any time effective with respect to
any Plan Year subsequent to the date action is taken by the Company to
terminate this Plan, subject to Section 8.3.  In the event the Plan is terminated, no
further contributions or credits shall be made after the effective date of the
Plan’s termination other than interest credits made pursuant to Section 5.2,
and payments shall be made in accordance with the payment provisions of Article 6.  The preceding provisions of this Section 8.2
to the contrary notwithstanding, the Company may in its discretion terminate
the Plan effective as of a date that is prior to the first day of a subsequent
Plan Year and provide for accelerated payments of all amounts credited to
Accounts upon a termination of the Plan to the extent such termination and
acceleration of payments satisfies the applicable requirements upon the
termination of a plan pursuant to Code Section 409A.


 


8.3                                 Existing Rights.  No amendment or termination of the Plan shall
adversely affect the rights of any Participant with respect to amounts credited
to his or her Account prior to the date of such amendment or termination.


 


26

















 


ARTICLE
9.  MISCELLANEOUS


 


9.1                                 No Funding;
Source of Payments.  Nothing in
this Plan will be construed to create a trust or to obligate an Employer or any
other person to segregate a fund, purchase an insurance contract, or in any
other way currently to fund the future payment of any benefits hereunder, nor
will anything herein be construed to give any employee or any other person
rights to any specific assets of an Employer or of any other person.  Benefit payments to be made with respect to a
Participant’s Accounts shall be paid in cash from the general assets of the
Employer, and shall be the obligation solely of the Employer maintaining such
Accounts.


 


9.2                                 Nonassignability;
Domestic Relations Order.  None
of the benefits, payments, proceeds or claims of any Participant or beneficiary
shall be subject to any claim of any creditor of the Participant or beneficiary
and, in particular, the same shall not be subject to attachment or garnishment
or other legal process by any creditor of the Participant or beneficiary, nor
shall any Participant or beneficiary have any right to alienate, anticipate,
commute, pledge, encumber or assign any of the benefits or payments or proceeds
which he may expect to receive, contingently or otherwise, under this
Plan.  Notwithstanding the preceding, the
Committee shall direct that all or any portion of the amount credited to a
Participant’s Account be paid to an individual other than the Participant to
the extent necessary to comply with an order that the Committee has determined
to be a “domestic relations order” as defined in Code Section 414(p)(1)(B).  Further, and any provision of the Plan to the
contrary notwithstanding, the payment of amounts credited to a Participant’s
Account to an individual other than the Participant shall be accelerated as may
be necessary to fulfill an order that the Committee has determined to be a “domestic
relations order” as defined in Code Section 414(p)(1)(B).


 


9.3                                 Limitation of
Participants’ Rights. 
Participation in this Plan shall not give any Eligible Employee the
right to be retained in the employ of an Employer or an Affiliate or any


 


27

















 


right or interest in the Plan other than as herein
provided.  The Employers and their
Affiliates reserve the right to dismiss any Eligible Employee without any
liability for any claim against the Employer or Affiliate, except to the extent
of benefit payments provided herein.


 


9.4                                 Participants
Bound.  Any action with respect to
this Plan taken by the Committee or the Company or any action authorized by or
taken at the direction of the Committee or the Company shall be conclusive upon
all Participants and any other persons who claim entitlement to benefits under
the Plan.


 


9.5                                 Receipt and
Release.  Any payment to any Participant
or beneficiary in accordance with the provisions of this Plan shall, to the
extent thereof, be in full satisfaction of all claims against the Employers and
the Committee under this Plan, and the Committee may require such Participant
or beneficiary, as a condition precedent to such payment, to execute a receipt
and release to such effect.  If any
Participant or beneficiary is determined by the Committee to be incompetent by
reason of physical or mental disability (including minority) to give a valid
receipt and release, the Committee may cause the payment or payments becoming
due to such person to be made to another person for his or her benefit without
responsibility on the part of the Committee or the Employer to follow the
application of such funds.


 


9.6                                 Governing Law.  This Plan shall be construed, administered,
and governed in all respects under and by the internal laws (and not the
principles relating to conflicts of laws) of the State of Texas, except where
superseded by federal law.  If any
provision shall be held by a court of competent jurisdiction to be invalid or
unenforceable, the remaining provisions hereof shall continue to be fully
effective.


 


9.7                                 No Guarantee of
Tax Consequences .  No person
connected with the Plan in any capacity, including, but not limited to, the
Employers and any Affiliate and their respective directors, officers, agents
and employees, makes any representation, commitment or guarantee


 


28

















 


that any tax treatment, including, but not limited
to, federal, state and local income, estate and gift tax treatment, will be
applicable with respect to any amounts deferred or payable under the Plan or
that such tax treatment will apply to or be available to a Participant on
account of participation in the Plan.


 


9.8                                 Adoption by
Other Employers .  With the
consent of the Board of Directors of the Company, this Plan may be adopted by
any Affiliate, such adoption to be effective as of the date specified by such
Affiliate at the time of adoption.


 


9.9                                 Headings and
Subheadings.  Headings
and subheadings in this Plan are inserted for convenience only and are not to
be considered in the construction of the provisions hereof.


 


IN WITNESS WHEREOF, The Neiman Marcus Group, Inc.
has caused this Plan to be executed by its duly authorized officer this
         day of December, 2007.


 


 


	
   

  	
   

  	
  THE
  NEIMAN MARCUS GROUP, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Nelson A. Bangs

  
	
   

  	
   

  	
  Nelson
  A. Bangs

  



 


29