Neiman Marcus 2003 Annual Report Download - page 243

Section 5.11. Restrictions on Sales, Consolidations and Mergers.
(a) The Borrower will not sell, lease or in any way dispose of all, or substantially all, of its property or assets to any
other Person, nor will the Borrower consolidate or merge with or into any other Person; provided that this Section 5.11 shall not
prevent any merger involving the Borrower in which the Borrower is the surviving corporation if, at the time of, and after giving effect
to any such merger, no Default shall have occurred and be continuing.
(b) Neither the Borrower nor any Subsidiary will sell, lease or otherwise dispose of any of its property or assets, except
(i) in the ordinary course of its business, (ii) to the Borrower or any Subsidiary, (iii) in connection with a Securitization Transaction or
a Sale-Leaseback Transaction or (iv) other dispositions of property or assets, provided that the aggregate book value of the property or
assets so disposed of pursuant to this clause (v) in any fiscal year shall not exceed 20% of the consolidated assets of the Borrower and
its Consolidated Subsidiaries as at the last day of the preceding fiscal year.
(c) The aggregate outstanding principal amount of Debt deemed incurred in respect of Securitization Transactions
pursuant to Section 1.02(b) shall at no time exceed $500,000,000.
Section 5.12. Transactions with Affiliates. The Borrower will not, and will not permit any Subsidiary to, directly or
indirectly, pay any funds to or for the account of, make any Investment in, lease, sell, transfer or otherwise dispose of any assets,
tangible or intangible, to, or participate in, or effect any transaction in connection with any joint enterprise or other joint arrangement
with, any Affiliate; provided, however, that the foregoing provisions of this Section shall not prohibit (i) the Borrower or any
Subsidiary from declaring or paying any lawful dividend or distribution so long as after giving effect thereto, no Default shall have
occurred and be continuing or (ii) the Borrower or any Subsidiary from engaging in any commercial transaction with an Affiliate so
long as such transaction is on terms and conditions at least as favorable to the Borrower or such Subsidiary as the terms and conditions
which would apply in a similar transaction with a Person that is not an Affiliate; provided further that a transaction permitted by this
Section may nonetheless give rise to an Event of Default under another Section of this Agreement.
Section 5.13. Restriction on Debt of Subsidiaries. The Borrower will not permit any of its Subsidiaries to incur or at
any time be liable with respect to any Debt, except (a) Debt owing to the Borrower or any Wholly-Owned Subsidiary, (b) Debt which
is secured by a Lien permitted by Section 5.10, (c) Debt of any corporation at the time such corporation becomes a Subsidiary and not
created in contemplation of such event, (d) Debt of Subsidiaries not otherwise permitted by any of the foregoing clauses in an
aggregate principal amount at any time outstanding not to exceed $50,000,000, (e) Debt of Subsidiaries outstanding on the date of this
Agreement and (f) Debt arising out of any refinancing, extension, renewal or replacement of any Debt permitted by clauses (b), (c)
and (e) above that does not increase the outstanding principal amount thereof.
Section 5.14. Use of Proceeds. The proceeds of the Loans made under this Agreement will be used by the Borrower for
general corporate purposes. None of such proceeds will be used, directly or indirectly, for the purpose, whether immediate, incidental
or ultimate, of buying or carrying any "margin stock" within the meaning of Regulation U.
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