Neiman Marcus 2004 Annual Report Download - page 38

refinancing our 6.65% senior notes due 2008). These payments are expected to be funded by a combination of equity contributions and debt financing as well
as our available cash (including cash available as a result of the completion of the Credit Card Sale).
Parent has obtained equity and debt financing commitments for the transactions contemplated by the merger agreement, which are generally subject to
customary conditions. After giving effect to contemplated draws by us under the new debt commitments, and taking into account the $125 million aggregate
principal amount of our 7.125% senior debentures due 2028 that we and Parent intend to keep outstanding after completion of the merger and the planned
redemption of our 6.65% senior notes due 2008 after the closing of the merger, Parent currently expects total existing and new debt outstanding at closing of
the merger transaction will be approximately $3.3 billion.
In connection with the execution and delivery of the merger agreement, Merger Sub has obtained commitments to provide up to $3.9 billion in debt
financing (not all of which is expected to be drawn at closing) consisting of (1) a senior secured asset-based revolving facility providing a maximum
availability of $600 million (Asset-Based Revolving Facility) and (2) term and bridge loan facilities and senior secured notes with an aggregate principal
amount of up to $3.3 billion to finance, in part, the payment of the merger consideration, the repayment or refinancing of certain of our debt outstanding on
the closing date of the merger and to pay fees and expenses in connection therewith and, in the case of the Asset-Based Revolving Facility, for general
corporate purposes after the closing date of the merger.
The facilities and notes contemplated by the debt financing commitments are conditioned on the merger being consummated prior to the merger
agreement termination date, as well as other customary conditions including:
the absence of a material adverse change at the Company;
the creation of security interests;
the execution of satisfactory definitive documentation;
receipt of an amount equal to at least 25% of the pro forma total consolidated capitalization of Parent (on the closing date of the merger) in equity
or junior capital from equity investors, including affiliates of the Sponsors;
completion of a borrowing base audit and delivery of appraisals in respect of the Asset-Based Revolving Facility;
receipt of all required consents and approvals;
the absence of any amendments or waivers to the merger agreement to the extent adverse to the lenders in any material respect which have not
been approved by the agent;
the reasonable satisfaction of the agent for the Asset-Based Revolving Facility with our cash management systems, blocked account agreements
and lockbox agreements in connection with such facility;
the absence of any default, event of default or breach of representation;
certain maximum ratios of adjusted total debt (measured on the closing date and defined to exclude certain drawings under the Asset-Based
Revolving Facility on the closing date for working capital purposes but including an amount equal to 8 times annual rental expense and our
7.125% senior debentures, due 2028) to pro forma EBITDAR (measured over the most recent four-fiscal quarter period ending at least 45 days
prior to the closing date and defined as EBITDA for such period plus consolidated rental expense for such period and to include certain other
adjustments), senior secured debt to pro forma EBITDAR and senior debt to pro forma
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