Neiman Marcus 2013 Annual Report Download - page 25

Table of Contents
Bergdorf Goodman Stores. We operate two Bergdorf Goodman stores, both of which are located in Manhattan at 58th Street and Fifth Avenue. The
following table sets forth certain details regarding these stores:
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New York City (Main)(1)
1901
250,000
New York City (Men’s)(1)*
1991
66,000
(1) Leased.
* Mortgaged to secure our senior secured credit facilities and the 2028 Debentures.
Last Call Stores. As of September 19, 2014, we operated 38 Last Call stores that average approximately 26,000 square feet each in size.
Distribution, Support and Office Facilities. We own approximately 41 acres of land in Longview, Texas, where our primary distribution facility is
located. The Longview facility is the principal merchandise processing and distribution facility for Neiman Marcus stores. In the spring of 2013, we opened
a new 198,000 square feet distribution facility in Pittston, Pennsylvania to support the future growth and initiatives of the Company. The new facility in
Pittston replaced the distribution facility we previously utilized in Dayton, New Jersey. We lease four regional service centers in New York, Florida, Texas
and California.
We also own approximately 50 acres of land in Irving, Texas, where our online operating headquarters and distribution facility are located. In
addition, we currently utilize another regional distribution facility in Dallas, Texas to support our online operation.
Lease Terms. We lease a significant percentage of our stores and, in certain cases, the land upon which our stores are located. The terms of these
leases, assuming all outstanding renewal options are exercised, range from two to 130 years. The lease on the Bergdorf Goodman Main Store expires in 2050,
with no renewal options, and the lease on the Bergdorf Goodman Men’s Store expires in 2020, with a 10-year renewal option. Most leases provide for
monthly fixed rentals or contingent rentals based upon revenues in excess of stated amounts and normally require us to pay real estate taxes, insurance,
common area maintenance costs and other occupancy costs.
For further information on our properties and lease obligations, see Item 7, “Management’s Discussion and Analysis of Financial Condition and
Results of Operations” and Note 15 of the Notes to Consolidated Financial Statements in Item 15.
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Employment and Consumer Class Actions Litigation. On April 30, 2010, a Class Action Complaint for Injunction and Equitable Relief was filed
against the Company, Newton Holding, LLC, TPG Capital, L.P. and Warburg Pincus LLC in the United States District Court for the Central District of
California by Sheila Monjazeb, individually and on behalf of other members of the general public similarly situated. On July 12, 2010, all defendants except
for the Company were dismissed without prejudice, and on August 20, 2010, this case was dismissed by Ms. Monjazeb and refiled in the Superior Court of
California for San Francisco County. This complaint, along with a similar class action lawsuit originally filed by Bernadette Tanguilig in 2007, alleges that
the Company has engaged in various violations of the California Labor Code and Business and Professions Code, including without limitation, by (1) asking
employees to work “off the clock,” (2) failing to provide meal and rest breaks to its employees, (3) improperly calculating deductions on paychecks delivered
to its employees and (4) failing to provide a chair or allow employees to sit during shifts. The Monjazeb and Tanguilig class actions have been deemed
“related” cases and are pending before the same trial court judge. On October 24, 2011, the court granted the Company’s motion to compel Ms. Monjazeb
and Juan Carlos Pinela (a co-plaintiff in the Tanguilig case) to arbitrate their individual claims in accordance with the Company’s Mandatory Arbitration
Agreement, foreclosing their ability to pursue a class action in court. However, the court’s order compelling arbitration did not apply to Ms. Tanguilig
because she is not bound by the Mandatory Arbitration Agreement. Further, the court determined that Ms. Tanguilig could not be a class representative of
employees who are subject to the Mandatory Arbitration Agreement, thereby limiting the putative class action to those associates who were employed
between December 2003 and July 15, 2007 (the effective date of our Mandatory Arbitration Agreement). Following the court’s order, Ms. Monjazeb and
Mr. Pinela filed demands for arbitration with the American Arbitration Association (AAA) seeking to arbitrate not only their individual claims, but also class
claims, which the Company asserted violated the class action
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