Neiman Marcus 2009 Annual Report Download - page 372

warranty by or recourse or liability to Bank, and NMG shall have the sole right to collect all amounts payable under the assigned
Recourse Account. NMG agrees that Bank may deduct undisputed past due amounts that NMG owes to Bank for Recourse Accounts
hereunder from any amounts Bank owes to NMG under the Agreement. If Bank receives a payment on a Full Recourse Account after
it has been purchased by NMG, Bank will forward to NMG, as promptly as reasonably practicable, the equivalent sums for such
payment received.
20.4 Performance. NMG shall be obligated under this Article XX to make the payments referred to in Section 20.2 in
respect of Recourse Accounts without requiring any actions or proceedings to be taken by Bank against the Cardholder(s). NMG
expressly waives the benefit of any notice from Bank of modification of the Recourse Account terms and agrees that, prior to any
purchase demand by Bank, Bank may, without releasing the liability of NMG hereunder, extend the time for making any payment,
waive or extend the performance of any agreement or otherwise waive, amend, extend or modify any agreement or terms governing
Recourse Accounts. Bank may proceed against NMG directly and independently of Cardholder(s), as Bank may elect.
20.5 Reports. Bank agrees to provide NMG with reporting on the status of all Recourse Accounts not less than monthly.
Such report shall include the total number of Recourse Accounts in the Recourse Portfolio, the aggregate dollar amount of the
Recourse Accounts in the Recourse Portfolio, the percentage of the total Program receivables that are comprised of Recourse
Accounts, and an itemized accounting of the delinquency level of each Recourse Account.
20.6 Termination. Bank may discontinue the addition of new Recourse Accounts to the Recourse Portfolio at any time,
upon [***] days prior written notice to NMG. In addition, upon termination of the Agreement, or receipt or delivery of notice of
termination by any Party, Bank may immediately cease the addition of new Recourse Accounts. In such case, the rights and
obligations of the Parties with respect to Recourse Accounts established before the effective date of termination will not be affected.
20.7 Portfolio Cap. If, at any time, the aggregate dollar amount of Gross Receivables in the Recourse Portfolio equals or
exceeds [***] of Bank's receivables for the total Program, then Bank may suspend the addition of new Accounts to the Recourse
Portfolio until the aggregate dollar amount of the Recourse Portfolio falls below the cap.
20.8 Removals from Recourse Portfolio. In the event a Cardholder pays the entire balance owed on a Recourse Account,
Bank may in its sole discretion at any point thereafter remove such Recourse Account from the Recourse Portfolio and treat it as a
regular Account. Accordingly, if, and from the time, any such Recourse Account is removed from the Recourse Portfolio, the Account
shall no longer be deemed a Recourse Account or subject to the terms of this Article XX.
20.9 Annual Review. At the end of each Program Year, Bank will review the performance of the Recourse Portfolio and
shall, with respect to any of such Recourse Accounts that would qualify as an Account with the credit line then in effect thereunder
under the Risk Management Policies then in effect, redesignate such Account as an Account that is not a Recourse Account.
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