Exhibit 10.1

 

EXECUTION VERSION

 

NEIMAN MARCUS GROUP, INC., ET AL.

 

TRANSACTION SUPPORT AGREEMENT

 

MARCH 25, 2019

 

THIS TRANSACTION SUPPORT AGREEMENT AND THE DOCUMENTS ATTACHED TO THIS TRANSACTION SUPPORT AGREEMENT COLLECTIVELY DESCRIBE A PROPOSED RECAPITALIZATION OF NEIMAN MARCUS GROUP, INC., A DELAWARE CORPORATION, AND CERTAIN OF ITS SUBSIDIARIES ON THE TERMS AND CONDITIONS SET FORTH ON EXHIBIT A ATTACHED TO THIS AGREEMENT.

 

THIS TRANSACTION SUPPORT AGREEMENT IS NOT AN OFFER OR A SOLICITATION WITH RESPECT TO ANY SECURITIES OF THE COMPANY PARTIES.  ANY SUCH OFFER OR SOLICITATION SHALL COMPLY WITH ALL APPLICABLE SECURITIES LAWS.

 

THIS TRANSACTION SUPPORT AGREEMENT IS A SETTLEMENT PROPOSAL TO CERTAIN UNAFFILIATED LENDERS UNDER THE COMPANY PARTIES’ TERM LOAN CREDIT AGREEMENT, CERTAIN UNAFFILIATED HOLDERS OF THE COMPANY PARTIES’ UNSECURED NOTES, AND CERTAIN HOLDERS OF THE COMPANY PARTIES’ EXISTING COMMON STOCK IN FURTHERANCE OF SETTLEMENT DISCUSSIONS.  ACCORDINGLY, THIS TRANSACTION SUPPORT AGREEMENT IS PROTECTED BY RULE 408 OF THE FEDERAL RULES OF EVIDENCE AND ANY OTHER APPLICABLE STATUTES OR DOCTRINES PROTECTING THE USE OR DISCLOSURE OF CONFIDENTIAL SETTLEMENT DISCUSSIONS.

 

THIS TRANSACTION SUPPORT AGREEMENT DOES NOT PURPORT TO SUMMARIZE ALL OF THE TERMS, CONDITIONS, REPRESENTATIONS, WARRANTIES, AND OTHER PROVISIONS WITH RESPECT TO THE TRANSACTIONS DESCRIBED IN THIS TRANSACTION SUPPORT AGREEMENT, WHICH TRANSACTIONS WILL BE SUBJECT TO THE COMPLETION OF DEFINITIVE DOCUMENTS INCORPORATING THE TERMS AND CONDITIONS SET FORTH IN THIS TRANSACTION SUPPORT AGREEMENT AND THE CLOSING OF ANY TRANSACTION SHALL BE SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN SUCH DEFINITIVE DOCUMENTS.  

 

This TRANSACTION SUPPORT AGREEMENT (including all exhibits, annexes, and schedules to this Agreement in accordance with Section 14.02 of this Agreement, this “Agreement”) is made and entered into as of March 25, 2019 (the “Execution Date”), by and among the following parties, each in the capacity set forth on its signature page to this Agreement (each of the following described in sub-clauses (i) through (vi) of this preamble, a “Party” and, collectively, the “Parties”):(1)

 

i.                                          Neiman Marcus Group, Inc., a company incorporated under the Laws of the State of Delaware (“NMG”), and each of its Subsidiaries that has executed and delivered, 

 




(1)                                 Capitalized terms used but not defined in the preamble and recitals to this Agreement have the meanings ascribed to them in Section 1, or the Recapitalization Term Sheet, as applicable.

 











 

or in the future, executes and delivers, counterpart signature pages to this Agreement (collectively with NMG, the “Company Parties”);

 

ii.                                       each of Ares Corporate Opportunities Fund III, L.P. and Ares Corporate Opportunities Fund IV, L.P., on behalf of itself and each of its affiliated investment funds or investment vehicles managed or advised by it, and its Affiliates that directly or indirectly hold Equity Interests in the Company Parties (collectively, the “Ares Sponsor”);

 

iii.                                    CPP Investment Board USRE Inc., on behalf of itself and each of its Affiliates that directly or indirectly hold Equity Interests in the Company Parties (collectively, the “CPPIB Sponsor” and, together with the Ares Sponsor, the “Sponsors”);

 

iv.                                   the undersigned holders of, nominees, investment managers, advisors or subadvisors to funds and/or accounts, or trustees of trusts, that hold outstanding Claims under the Term Loan Credit Agreement that have executed and delivered counterpart signature pages to this Agreement, or signature pages to a Joinder or Transfer Agreement (as applicable), to counsel to the Company Parties (collectively, the “Consenting Term Loan Lenders”);

 

v.                                      the undersigned holders of, nominees, investment managers, advisors or subadvisors to funds and/or accounts, or trustees of trusts, that hold certain of the Cash Pay Notes that have executed and delivered counterpart signature pages to this Agreement, or signature pages to a Joinder or Transfer Agreement (as applicable), to counsel to the Company Parties (collectively, the “Consenting Cash Pay Noteholders”); and

 

vi.                                   the undersigned holders of, nominees, investment managers, advisors or subadvisors to funds and/or accounts, or trustees of trusts, that hold outstanding PIK Toggle Notes that have executed and delivered counterpart signature pages to this Agreement, or signature pages to a Joinder or Transfer Agreement (as applicable), to counsel to the Company Parties (collectively, the “Consenting PIK Toggle Noteholders” and, together with the Parties in clauses (ii) through (v) above, the “Consenting Stakeholders”).

 

RECITALS

 

WHEREAS, the Parties have in good faith and at arm’s-length negotiated or been apprised of certain recapitalization transactions with respect to the Company Parties’ capital structure (the “Recapitalization Transactions”) on the terms and conditions set forth in this Agreement and in the term sheet attached as Exhibit A to this Agreement (together with the exhibits and appendices annexed to such term sheet, the “Recapitalization Term Sheet”);

 

WHEREAS, on the date hereof: (i) the Company Parties and (ii) the Consenting Stakeholders have agreed to the Recapitalization Term Sheet which sets forth the principal economic terms of the Recapitalization Transactions that would be consummated upon the 

 

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execution of final documents containing terms consistent with those set forth in the Recapitalization Term Sheet and such other terms as agreed to by the Parties;

 

WHEREAS, the Parties have agreed to support the Recapitalization Transactions subject to and in accordance with the terms of this Agreement and the Recapitalization Term Sheet and desire to work together to complete the negotiation of the terms of the documents and completion of each of the actions necessary or desirable to effect the Recapitalization Transactions;

 

WHEREAS, the Parties have agreed to grant the Releases as set forth in this Agreement; and

 

WHEREAS, the Parties have agreed to take certain actions in support of the Recapitalization Transactions on the terms and conditions set forth in this Agreement, including the Recapitalization Term Sheet.

 

NOW, THEREFORE, in consideration of the covenants and agreements contained in this Agreement, and for other valuable consideration, the receipt and sufficiency of which are acknowledged, each Party, intending to be legally bound, agrees as follows:

 

AGREEMENT

 

Section 1.                                          Definitions and Interpretation.

 

1.01.                     Definitions.  The following terms shall have the following definitions:

 

“2028 Debentures” means the debentures issued pursuant to the 2028 Debentures Indenture.

 

“2028 Debentures Indenture” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Ad Hoc Committee of Unsecured Noteholders” means that certain ad hoc committee of Consenting Unsecured Noteholders represented by Paul, Weiss and Houlihan Lokey.

 

“Affiliate” means, with respect to any specified Entity, any other Entity directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Entity.  For purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by,” and “under common control with”), as used with respect to any Entity, shall mean the possession, directly or indirectly, of the right or power to direct or cause the direction of the management or policies of such Entity, whether through the ownership of voting securities, by agreement, or otherwise.

 

“Agents/Trustees” means, collectively, each of the Term Loan Agent and the Trustees.

 

“Agreement” has the meaning set forth in the preamble to this Agreement and, for the avoidance of doubt, includes all exhibits, annexes, and schedules to this Agreement in accordance with Section 14.02 of this Agreement (including the Recapitalization Term Sheet).

 

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“Agreement Effective Date” means the date on which the conditions set forth in Section 2 of this Agreement have been satisfied or waived by the required Party or Parties in accordance with this Agreement.

 

“Agreement Effective Period” means, with respect to a Party, the period from the Agreement Effective Date to the Termination Date applicable to that Party.

 

“Alternative Transaction Proposal” means any inquiry, proposal, offer, bid, term sheet, discussion, or agreement with respect to a sale, disposition, new-money investment, restructuring, reorganization, merger, amalgamation, acquisition, consolidation, dissolution, debt investment, equity investment, liquidation, tender offer, recapitalization, plan of reorganization, share exchange, business combination, or similar transaction involving any one or more Company Parties or a Claim against or Equity Interest in any one or more Company Parties that is an alternative to one or more of the Recapitalization Transactions.

 

“Amended Term Loan Credit Agreement” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Amended Term Loan Term Sheet” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Amendment and Extension” has the meaning ascribed to such term in the Amended Term Loan Term Sheet.

 

“Ares Sponsor” has the meaning set forth in the preamble to this Agreement.

 

“Bankruptcy Code” means Title 11 of the United States Code.

 

“Business Day” means any day other than a Saturday, Sunday, or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state of New York.

 

“Cash Pay Noteholders” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Cash Pay Notes” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Cash Pay Notes Indenture” means that certain indenture, dated as of October 21, 2013, as amended, restated, amended and restated, supplemented or otherwise modified, or replaced from time to time, for the Cash Pay Notes, among NMG LTD LLC, as issuer, Mariposa Borrower, as issuer, each of the guarantors party to such indenture, and the applicable Trustee.

 

“Cash Pay Notes Trustee” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

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“Causes of Action” means any action, Claim, cause of action, controversy, demand, right, action, lien, indemnity, interest, guaranty, suit, obligation, liability, damage, judgment, account, defense, offset, power, privilege, and license of any kind or character whatsoever, whether known, unknown, contingent or non-contingent, matured or unmatured, suspected or unsuspected, liquidated or unliquidated, disputed or undisputed, secured or unsecured, assertable directly or derivatively, whether arising before, on, or after the Effective Date, in contract or in tort, in law (whether local, state, or federal U.S. or non-U.S. law) or in equity, or pursuant to any other theory of local, state, or federal U.S. or non-U.S. law.  For the avoidance of doubt, “Cause of Action” includes:  (a) any right of setoff, counterclaim, or recoupment and any Claim for breach of contract or for breach of duties imposed by law or in equity; (b) any Claim based on or relating to, or in any manner arising from, in whole or in part, tort, breach of contract, breach of fiduciary duty, fraudulent transfer or fraudulent conveyance or voidable transaction law, violation of local, state, or federal or non-U.S. law or breach of any duty imposed by law or in equity, including securities laws, negligence, and gross negligence; (c) any Claim pursuant to section 362 or chapter 5 of the title 11 of the United States Code or similar local, state, or federal U.S. or non-U.S. law; (d) any Claim or defense including fraud, mistake, duress, and usury, and any other defenses set forth in section 558 of the Bankruptcy Code; (e) any state or foreign law pertaining to actual or constructive fraudulent transfer, fraudulent conveyance, or similar Claim; and (f) any “lender liability” or equitable subordination claims or defenses.

 

“Claim” means any (a) right to payment, whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured; or (b) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured, or unsecured.

 

“Commitment Letter” means the “Commitment Letter” as defined in the Recapitalization Term Sheet, together with the Payment Letter.

 

“Commitment Payment” has the meaning ascribed to such term in the Payment Letter.

 

“Company Claims/Interests” means, collectively, any Claim against or Equity Interest in a Company Party or a wholly or partially owned direct or indirect subsidiary of any Company Party.

 

“Company Parties” has the meaning set forth in the preamble to this Agreement.

 

“Company Releasing Parties” means each of the Company Parties and, to the maximum extent permitted by Law, each of the Company Parties on behalf of its Related Parties.

 

“Confidentiality Agreement” means an executed confidentiality agreement with a Company Party, including with respect to the issuance of a “cleansing letter” or other public disclosure of material non-public information, in connection with any proposed Recapitalization Transaction.

 

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“Consenting Cash Pay Noteholders” has the meaning set forth in the preamble to this Agreement.  “Consenting Cash Pay Noteholders” includes Consenting Term Loan Lenders that are also holders of Cash Pay Notes and/or Consenting PIK Toggle Noteholders that are also holders of Cash Pay Notes.

 

“Consenting PIK Toggle Noteholders” has the meaning set forth in the preamble to this Agreement.  “Consenting PIK Toggle Noteholders” includes Consenting Term Loan Lenders that are also holders of PIK Toggle Notes and/or Consenting Cash Pay Noteholders that are also holders of PIK Toggle Notes.

 

“Consenting Stakeholder Releasing Parties” means each of the Consenting Stakeholders and, to the maximum extent permitted by Law, each of the Consenting Stakeholders on behalf of its Related Parties.

 

“Consenting Stakeholders” has the meaning set forth in the preamble to this Agreement.  For the avoidance of doubt, the term “Consenting Stakeholders” includes the Sponsors, Consenting Term Loan Lenders, and Consenting Unsecured Noteholders.

 

“Consenting Term Loan Lenders” has the meaning set forth in the preamble to this Agreement.  “Consenting Term Loan Lenders” includes Consenting Cash Pay Noteholders that are also holders of Term Loans and/or Consenting PIK Toggle Noteholders that are also holders of Term Loans.

 

“Consenting Unsecured Noteholders” means, collectively, the Consenting Cash Pay Noteholders and the Consenting PIK Toggle Noteholders.  “Consenting Unsecured Noteholders” includes Consenting Term Loan Lenders that are also holders of Unsecured Notes.

 

“CPPIB Sponsor” has the meaning set forth in the preamble to this Agreement.

 

“Creditor Fees and Expenses” means all reasonable and documented fees and expenses of WLRK, Ducera, Paul, Weiss, Houlihan Lokey, local Texas counsel to the Ad Hoc Committee of Unsecured Noteholders, and such other professional advisors retained by the Ad Hoc Committee of Unsecured Noteholders and Term Loan Steering Committee with the consent of the Company Parties (regardless of whether such fees and expenses are incurred before or after the Execution Date) incurred through and including the Effective Date in each case (except with respect to local Texas counsel to the Ad Hoc Committee of Unsecured Noteholders) in connection with the negotiation and/or implementation of this Agreement and/or the Recapitalization Transactions and in each case (except with respect to local Texas counsel to the Ad Hoc Committee of Unsecured Noteholders) in accordance with the terms of the respective letter agreements (other than any provision with respect to the termination thereof prior to the Termination Date) of such firms with one or more of the Company Parties as in effect on the date hereof.

 

“Definitive Documents” means all of the definitive documents implementing the Recapitalization Transactions, including those set forth in Section 3.01 of this Agreement.

 

“DTC” means the Depository Trust Company.

 

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“Ducera” means Ducera Partners LLC, as financial advisor to the Term Loan Steering Committee.

 

“Effective Date” means the date of consummation of the Recapitalization Transactions, on which date (no later than 11:59 p.m. Eastern Standard Time) the Company Parties shall provide written notice to counsel to the Consenting Stakeholders in accordance with Section 14.10 of this Agreement confirming the occurrence thereof.  The failure to give such notice shall not affect whether the Effective Date has occurred.

 

“Entity” means any person, individual, corporation, limited liability company, partnership, joint venture, association, joint stock company, trust, unincorporated organization, Governmental Body or any agency or political subdivision of any Governmental Body, or any other entity, whether acting in an individual, fiduciary, or other capacity.

 

“Equity Interests” means, collectively, the shares (or any class of shares), common stock, capital stock, treasury stock, preferred stock, limited liability company interests, and any other equity, ownership, or profits interests, and options, warrants, rights, or other securities or agreements to acquire, purchase, or subscribe for, or which are convertible into the shares (or any class of shares) of, common stock, capital stock, treasury stock, preferred stock, limited liability company interests, or other equity, ownership, or profits interests (in each case whether or not arising under or in connection with any employment agreement or whether or not vested).

 

“Event” means any event, change, effect, occurrence, development, circumstance, condition, result, state of fact, or change of fact.

 

“Exchange Offer” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Execution Date” has the meaning set forth in the preamble to this Agreement.

 

“Existing Common Stock” means the shares of common stock issued by NMG LTD LLC and outstanding.

 

“Extended Term Loans” has the meaning ascribed to such term in the Amended Term Loan Term Sheet.

 

“Governmental Body” means any U.S. or non-U.S. federal, state, municipal, or other government, or other department, commission, board, bureau, agency, public authority, or instrumentality thereof, or any other U.S. or non-U.S. court or arbitrator.

 

“Houlihan Lokey” means Houlihan Lokey Capital, Inc., as financial advisor to the Ad Hoc Committee of Unsecured Noteholders.

 

“Indentures” means, collectively, the Cash Pay Notes Indenture and the PIK Toggle Notes Indenture.

 

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“Initial Consenting Term Loan Lenders” means the Consenting Term Loan Lenders that execute this Agreement on or before the Agreement Effective Date.

 

“Initial Consenting Term Loan Lenders Break Fee” means a fee equal to 1.25% of the aggregate principal amount of the Term Loans held by the Initial Consenting Term Loan Lenders as of the Agreement Effective Date.

 

“Initial Consenting Unsecured Noteholders” means the Consenting Unsecured Noteholders that execute this Agreement on or before the Agreement Effective Date.

 

“Initial Consenting Unsecured Noteholders Break Fee” means a fee equal to 1.25% of the aggregate principal amount of the outstanding Unsecured Notes held by the Initial Consenting Unsecured Noteholders as of the Agreement Effective Date.

 

“Initial Paydown” has the meaning ascribed to such term in the Amended Term Loan Term Sheet.

 

“Joinder” means a joinder to this Agreement substantially in the form attached to this Agreement as Exhibit B.

 

“Law” means any federal, state, local, or non-U.S. law (including, in each case, any common law), statute, code, ordinance, rule, regulation, order, ruling, or judgment, in each case, that is validly adopted, promulgated, issued, or entered by a Governmental Body of competent jurisdiction.

 

“Lazard” means Lazard Freres & Co., LLC as financial advisor to the Company Parties.

 

“Marble Ridge Litigation” means the filing of a complaint or commencement of litigation by Marble Ridge Capital LP and its related or affiliated funds against NMG and other defendants in the District Court of Dallas County, Texas concerning certain transactions relating to the MyTheresa brand (and the MT Entities) and certain of the Company Parties and their respective Subsidiaries’ real properties, in each case, as more specifically described in the complaint filed by Marble Ridge Capital LP and its related or affiliated funds in the District Court of Dallas County, Texas on December 10, 2018, including a request for the appointment of a receiver under Texas state law for Mariposa Intermediate, a guarantor under the Term Loan Credit Agreement, and NMG LTD LLC, the borrower under the Term Loan Credit Agreement, including any amendments, supplements or modifications to any such complaint or commencement of litigation (or any similar action or claim brought by any other party).

 

“Mariposa Borrower” means Mariposa Borrower, Inc., a Delaware corporation and a direct Subsidiary of NMG LTD LLC.

 

“Mariposa Intermediate” means Mariposa Intermediate Holdings LLC, a Delaware limited liability company and a direct Subsidiary of NMG.

 

“Material Adverse Effect” means any Event which individually, or together with all other Events, has had or would reasonably be expected to have a material and adverse effect on the 

 

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business, assets, liabilities, finances, properties, results of operations or financial condition of the Company Parties and their Subsidiaries, taken as a whole and taking into account the Recapitalization Transactions, except to the extent such Event results from, arises out of, or is attributable to, the following (either alone or in combination): (i) any change after the date hereof in global, national or regional political conditions (including acts of war, terrorism or natural disasters) or in the general business, market, financial or economic conditions affecting the industries, regions and markets in which the Company Parties and their Subsidiaries operate; (ii) any changes after the date hereof in applicable Law or GAAP (or similar accounting rules), or in the interpretation or enforcement thereof; (iii) the execution, announcement or performance of this Agreement or the Recapitalization Transactions or the transactions contemplated hereby or thereby; or (iv) changes in the market price or trading volume of the claims or equity or debt securities, or any derivative claim or security thereof, of any of the Company Parties or any of their Subsidiaries (but not the underlying facts giving rise to such changes unless such facts are otherwise excluded pursuant to the clauses contained in this definition).

 

“MT Entities” means, collectively, (i) Mariposa Luxembourg I S.à r.l. (Luxembourg), (ii) Mariposa Luxembourg II S.à r.l. (Luxembourg), (iii) NMG Germany GmbH, (iv) mytheresa.com GmbH (Germany), (v) mytheresa.com Service GmbH (Germany), and (vi) Theresa Warenvertrieb GmbH (Germany).

 

“MT Operating Entities” means mytheresa.com GmbH, mytheresa.com Service GmbH, Theresa Warenvertrieb GmbH, and NMG Germany GmbH.

 

“MT Preferred Equity” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“MyTheresa Assets” means the assets described in clauses (1), (2), and (3) of the definition of MyTheresa Distribution.

 

“MyTheresa Designation” means, collectively, all designations by any Company Party or any of their Related Parties prior to the Execution Date of any of the MT Entities as “unrestricted” subsidiaries under the Indentures, the Term Loan Credit Agreement, or the Revolving Credit Agreement, and all acts or omissions taken by any Company Party or any of its Related Parties in structuring, implementing, or effectuating the foregoing designations.

 

“MyTheresa Distribution” means, collectively, all distributions or dividends by any Company Party (including but not limited to NMG International LLC, a Delaware limited liability company) prior to the Execution Date to or for the benefit of any other Company Parties of (1) any Equity Interests in the MT Entities, (2) any indebtedness owed by the MT Entities to any Company Party (including but not limited to NMG International LLC), and (3) any and all other Claims or Equity Interests of any Company Party (including but not limited to NMG International LLC) in the MT Entities, and all acts or omissions taken by any Company Party or any of its Related Parties in structuring, implementing, or effectuating the distributions or dividends described in clauses (1)—(3).

 

“Nancy Transaction”  means, collectively, (a) the formation of Nancy Holdings LLC, (b) all designations prior to the Execution Date by any Company Party or any of its Related Parties 

 

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of Nancy Holdings LLC as an “unrestricted” subsidiary under the Indentures, the Term Loan Credit Agreement, or the Revolving Credit Agreement, (c) all contributions, investments, conveyances, or transfers of any real properties or any interests associated with such real properties by any Company Party or any of its Related Parties in or to Nancy Holdings LLC prior to the Execution Date, (d) all leases of real properties or any interests associated with such real properties between Nancy Holdings LLC as lessor, and any Company Party as lessee, entered into prior to the Execution Date, and (e) all acts or omissions taken prior to the Execution Date by any Company Party or any of its Related Parties in structuring, implementing, or effectuating the foregoing.

 

“Neiman Marcus LLC” means The Neiman Marcus Group, LLC, a Delaware limited liability company and a direct Subsidiary of NMG LTD LLC.

 

“New Second Lien Notes” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“New Second Lien Notes Indenture” means the indenture, or other definitive document as applicable, that will govern the New Second Lien Notes.

 

“New Second Lien Notes Term Sheet” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“New Third Lien Notes” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“New Third Lien Notes Indenture” means the indenture, or other definitive document as applicable, that will govern the New Third Lien Notes.

 

“New Third Lien Notes Term Sheet” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“NMG” has the meaning set forth in the preamble to this Agreement.

 

“NMG LTD LLC” means Neiman Marcus Group LTD LLC, a Delaware limited liability company and a direct Subsidiary of Mariposa Intermediate.

 

“Noteholder Cash Joinder Payment” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Noteholder Participation Threshold Condition Precedent” means the condition precedent to the Effective Date that institutions holding, in the aggregate, at least 95% (or such lower amount as determined by the Company Parties in their sole discretion in accordance with the Recapitalization Term Sheet) of the aggregate outstanding principal amount of Unsecured Notes have signed consents to participate in the Recapitalization Transactions.

 

“Parties” has the meaning set forth in the preamble to this Agreement.

 

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“Paul, Weiss” means Paul, Weiss, Rifkind Wharton & Garrison, LLP, in its capacity as counsel to the Ad Hoc Committee of Unsecured Noteholders.

 

“Payment Letter” has the meaning ascribed to such term in the Commitment Letter.

 

“Permitted Transferee” means each transferee of any Company Claims/Interests that meets the requirements of Section 8.01 of this Agreement.

 

“PIK Toggle Noteholders” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“PIK Toggle Notes” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“PIK Toggle Notes Indenture” means that certain Indenture, dated as of October 21, 2013, as amended, restated, amended and restated, supplemented or otherwise modified, or replaced from time to time, for the PIK Toggle Notes, among NMG LTD LLC, as issuer, Mariposa Borrower, as issuer, each of the guarantors party to such indenture, and the applicable Trustee.

 

“PIK Toggle Notes Trustee” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Principal Terms” means (i) the form and quantum of consideration to be offered to each of the Consenting Stakeholders in exchange for existing Company Claims/Interests pursuant to the Recapitalization Transactions, (ii) the interest rate, amortization and maturity of the Extended Term Loans, (iii) the Term Loan Lender Consent Fee and the Term Loan Lender Cash Joinder Fee, in each case as set forth in the Amended Term Loan Term Sheet, and the Term Loan Lender Extension Fee as set forth in Section 13(b) of this Agreement, (iv) the interest rate and maturity of the New Second Lien Notes as set forth in the New Second Lien Notes Term Sheet, (v) the interest rate and maturity of the New Third Lien Notes as set forth in the New Third Lien Notes Term Sheet, (vi) the Noteholder Cash Joinder Payment as set forth in the Recapitalization Term Sheet, (vii) any other payment obligations or fees set forth in the Recapitalization Term Sheet or the Definitive Documents, (viii) the identity of the issuers and/or co-issuers of any debt or security to be issued pursuant to the Recapitalization Transactions and/or to be added to the Existing Term Loan Credit Agreement with respect to the Initial Loans (as defined in the Amended Term Loan Term Sheet) and the Indentures in respect of the existing notes, (ix) Section 12.01(b) of this Agreement, (x) Section 12.01(B) of this Agreement, (xi) Section 12.01(m) of this Agreement insofar as it concerns the deadline set forth therein or the right of an individual Party to terminate this Agreement as to itself if the Effective Date has not occurred by the date specified (but subject to the last sentence of Section 13(b) of this Agreement); (xii) the definition of Initial Consenting Term Loan Lenders Break Fee and Section 12.05(d) of this Agreement; (xiii) the definition of Initial Consenting Unsecured Noteholders Break Fee and Section 12.05(e) of this Agreement, (xiv) Section 13 of this Agreement, this definition of “Principal Terms” or the definitions of “Required Consenting Term Loan Lenders” or “Required Consenting Unsecured Noteholders”; (xv) Section 14.23 of this Agreement; and (xvi) the coupon rate in respect of, and the maturity of, the MT Preferred Equity as set forth in the MyTheresa Issuer Preferred Equity Term Sheet.

 

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“Qualified Marketmaker” means an entity that (x) holds itself out to the public or applicable private markets as standing ready in the ordinary course of its business to purchase from customers and sell to customers claims against certain of the Company Parties (including debt securities or other debt) or enter with customers into long and short positions in claims against certain of the Company Parties (including debt securities or other debt), in its capacity as a dealer or market maker in such claims against certain Company Parties, and (y) is in fact regularly in the business of making a market in claims against issuers or borrowers (including debt securities or other debt).

 

“Recapitalization Term Sheet” has the meaning set forth in the recitals to this Agreement.

 

“Recapitalization Transactions” has the meaning set forth in the recitals to this Agreement.

 

“Related Parties” means, with respect to any Entity, such Entity’s predecessors, successors, assigns, and present and former Affiliates (whether by operation of law or otherwise) and Subsidiaries, and each of their respective managed accounts or funds or investment vehicles, and each of their respective current and former equity holders, officers, directors, managers principals, shareholders, members, partners, employees, agents, advisory board members, financial advisors, attorneys, accountants, investment bankers, consultants, representatives, management companies, fund advisors, and other professionals, in each case acting in such capacity.  For the avoidance of doubt, the MT Entities are Related Parties of the Sponsors.

 

“Release” means the releases given by the Releasing Parties to the Released Parties under Section 9 of this Agreement.

 

“Released Claim” means, with respect to any Releasing Party, any Claim, Cause of Action, or any other debt, obligation, right, suit, damage, judgment, action, remedy, or liability which is released by such Releasing Party under Section 9 of this Agreement.

 

“Released Party” means, collectively, (a) each of the Company Parties, (b) each of the Consenting Stakeholders, and (c) the Related Parties of each of the foregoing Entities in clauses (a) and (b) of this definition.

 

“Releasing Party” means collectively, (a) each of the Company Releasing Parties and (b) each Consenting Stakeholder Releasing Party.  For the avoidance of doubt, each of the Releasing Parties hereby grants the Release in all of its capacities, including with respect to the Consenting Stakeholders, in their capacity as holders of each Company Claim/Interest that they hold, and with respect to the Company Releasing Parties, including on behalf of each of their Affiliates, in each case, in accordance with the terms and conditions set forth in this Agreement.

 

“Required Consenting Term Loan Lenders” means, as of the relevant date, (i) Consenting Term Loan Lenders on the Term Loan Steering Committee (a) holding at least 50.01% of the aggregate outstanding principal amount of the Term Loans that are held by the Term Loan Steering Committee and (b) comprising at least a majority of the unaffiliated Consenting Term Loan Lenders on the Term Loan Steering Committee; or, (ii) if such threshold is not met, no fewer than five (5) unaffiliated Consenting Term Loan Lenders together holding at least 50.01% 

 

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of the aggregate outstanding principal amount of the Term Loans that are held by Consenting Term Loan Lenders.

 

“Required Consenting Unsecured Noteholders” means, as of the relevant date, (i) members of the Ad Hoc Committee of Unsecured Noteholders holding at least 66.67% of aggregate outstanding principal amount of the Unsecured Notes that is held by the Ad Hoc Committee of Unsecured Noteholders; or (ii) if the members of the Ad Hoc Committee of Unsecured Noteholders do not hold at least 50.01% of the aggregate outstanding principal amount of the Unsecured Notes, Consenting Unsecured Noteholders holding at least 50.01% of the aggregate outstanding principal amount of the Unsecured Notes that are held by Consenting Unsecured Noteholders.

 

“Restricted Period” means the period commencing as of the date each Consenting Stakeholder, as applicable, executes this Agreement until the Termination Date applicable to such Consenting Stakeholder.

 

“Revolving Credit Agreement” means that certain Revolving Credit Agreement, dated as of October 25, 2013, as amended, restated, amended and restated, supplemented or otherwise modified, or replaced from time to time, among NMG LTD LLC and certain Company Parties, as co-borrowers, each of the guarantors party thereto, Deutsche Bank AG New York Branch as administrative and collateral agent, and the lenders party thereto from time to time.

 

“Rules” means Rule 501(a)(1), (2), (3), and (7) of the Securities Act.

 

“Securities Act” means the Securities Act of 1933, as amended.

 

“Sponsors” has the meaning set forth in the preamble to this Agreement.

 

“Subsidiary” means, with respect to an Entity, any corporation, partnership, limited liability company, or other organization or entity, whether incorporated or unincorporated, of which at least a majority of the securities, or other interests having by their terms voting power to elect a majority of the board of directors or others performing similar functions with respect to such corporation or other organization or entity, is directly or indirectly beneficially owned or controlled by such Entity or by any one or more of its subsidiaries or by such Entity and one or more of its subsidiaries.

 

“Term Loan Agent” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Term Loan Credit Agreement” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Term Loan Lender Cash Joinder Fee” has the meaning ascribed to such term in the Amended Term Loan Term Sheet.

 

“Term Loan Lender Consent Fee” has the meaning ascribed to such term in the Amended Term Loan Term Sheet.

 

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“Term Loan Lender Extension Fee” means, with respect to any extension of the deadline in Section 12.01(m) of this Agreement pursuant to Section 13(b) of this Agreement, a fee, with respect to each Consenting Term Loan Lender who agrees to such extension, in an amount equal to 0.25% of the aggregate principal amount of the Term Loans held by such Consenting Term Loan Lender.

 

“Term Loan Lender Participation Threshold Condition Precedent” means the condition precedent to the Effective Date that institutions holding, in the aggregate, at least 95% (or such lower amount as determined by the Company Parties in their sole discretion in accordance with the Recapitalization Term Sheet) of the aggregate outstanding principal amount of Term Loans have signed consents to participate in the Recapitalization Transactions.

 

“Term Loan Lenders” has the meaning ascribed to such term in the Recapitalization Term Sheet.

 

“Term Loan Steering Committee” means that certain steering committee of Consenting Term Loan Lenders represented by WLRK and Ducera.

 

“Term Loans” means the loans made under the Term Loan Credit Agreement.

 

“Termination Date” means the date on which termination of this Agreement is effective as to a Party in accordance with Sections 12.01, 12.02, 12.03, or 12.04 of this Agreement.

 

“Transfer” means to sell, resell, reallocate, use, pledge, assign, transfer, hypothecate, participate, donate or otherwise encumber or dispose of, directly or indirectly (including through derivatives, options, swaps, pledges, forward sales or other transactions).

 

“Transfer Agreement” means an executed form of the transfer agreement providing, among other things, that a transferee is bound by the terms of this Agreement and substantially in the form attached to this Agreement as Exhibit C.

 

“Trustees” means the PIK Toggle Notes Trustee and the Cash Pay Notes Trustee.

 

“Unsecured Notes” means, collectively, the Cash Pay Notes and the PIK Toggle Notes.

 

“Unsecured Notes Indentures” means the Cash Pay Notes Indenture and the PIK Toggle Notes Indenture.

 

“WLRK” means Wachtell, Lipton, Rosen & Katz, in its capacity as counsel to the Term Loan Steering Committee.

 

1.02.                     Interpretation.  For purposes of this Agreement:

 

(a)                                 in the appropriate context, each term, whether stated in the singular or the plural, shall include both the singular and the plural, and pronouns stated in the masculine, feminine, or neuter gender shall include the masculine, feminine, and the neuter gender;

 

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(b)                                 capitalized terms defined only in the plural or singular form shall nonetheless have their defined meanings when used in the opposite form;

 

(c)                                  unless otherwise specified, any reference in this Agreement to a contract, lease, instrument, release, indenture, or other agreement or document being in a particular form or on particular terms and conditions means that such document shall be substantially in such form or substantially on such terms and conditions;

 

(d)                                 unless otherwise specified, any reference in this Agreement to an existing document, schedule, or exhibit shall mean such document, schedule, or exhibit, as it may have been or may be amended, restated, amended and restated, supplemented, or otherwise modified or replaced from time to time; notwithstanding the foregoing, any capitalized terms in this Agreement which are defined with reference to another agreement, are defined with reference to such other agreement as of the date of this Agreement, without giving effect to any termination of such other agreement or amendments to such capitalized terms in any such other agreement following the Execution Date;

 

(e)                                  unless otherwise specified, all references to “Sections” are references to Sections of this Agreement;

 

(f)                                   captions and headings to Sections are inserted for convenience of reference only and are not intended to be a part of or to affect the interpretation of this Agreement;

 

(g)                                  references to “shareholders,” “directors,” and/or “officers” shall also include “members” and/or “managers,” as applicable, as such terms are defined under the applicable limited liability company Laws; and

 

(h)                                 the use of “include” or “including” is without limitation, whether stated or not.

 

1.03.                     Conflicts.  To the extent there is a conflict between the body of this Agreement, on the one hand, and the Recapitalization Term Sheet, on the other hand, the terms and provisions of the body of this Agreement shall govern.  To the extent there is a conflict between the Recapitalization Term Sheet or this Agreement, on the one hand, and the Definitive Documents, on the other hand, the terms and provisions of the Definitive Documents shall govern.

 

Section 2.                                          Effectiveness of this Agreement.  This Agreement shall become effective and binding upon each of the Parties according to its terms at 12:00 a.m., prevailing Eastern Standard Time, on the Agreement Effective Date, which is the date on which all of the following conditions have been satisfied or waived in accordance with this Agreement:

 

(a)                                 each of the Company Parties shall have executed and delivered counterpart signature pages of this Agreement to counsel to each of the Parties;

 

(b)                                 the following shall have executed and delivered counterpart signature pages of this Agreement to counsel to each of the Parties:

 

(i)                                     the Sponsors;

 

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(ii)                                  Consenting Term Loan Lenders, including members of the Term Loan Steering Committee, that hold, in the aggregate, at least 50.01% in amount of the aggregate outstanding principal amount of the Term Loans; and

 

(iii)                               Consenting Cash Pay Noteholders, including members of the Ad Hoc Committee of Unsecured Noteholders, that hold, in the aggregate, at least 50.01% in amount of the aggregate outstanding principal amount of the Cash Pay Notes; and

 

(iv)                              Consenting PIK Toggle Noteholders, including members of the Ad Hoc Committee of Unsecured Noteholders, that hold, in the aggregate, at least 50.01% in amount of the aggregate outstanding principal amount of the PIK Toggle Notes;

 

(c)                                  the Commitment Letter (as defined in the Recapitalization Term Sheet) shall have been executed and delivered and shall be in full force and effect; and

 

(d)                                 the Company Parties shall have paid the Creditor Fees and Expenses that have been accrued up to the Agreement Effective Date and invoiced no later than one (1) day prior to the Agreement Effective Date.

 

Section 3.                                          Definitive Documents.

 

3.01.                     The Definitive Documents governing the Recapitalization Transactions shall include, without limitation, (i) the material documents governing the New Second Lien Notes (including the Second Lien Notes Indenture), (ii) the material documents governing the New Third Lien Notes (including the Third Lien Notes Indenture), (iii) the material documents governing the MT Preferred Equity (including the applicable Certificate of Designation and material organizational documents), and (iv) the Amended Term Loan Credit Agreement, and (v) all other material customary documents delivered in connection with transactions of this type (including, without limitation, any and all material documents necessary to implement the Recapitalization Transactions).  Unless expressly stated otherwise herein or in the Recapitalization Term Sheet, the Definitive Documents shall be in form and substance reasonably acceptable to the Company Parties, the Required Consenting Term Loan Lenders, the Required Consenting Unsecured Noteholders, and the Sponsors.

 

3.02.                     The Definitive Documents remain subject to negotiation and completion.  Upon completion, the Definitive Documents and any other document, deed, agreement, filing, notification, letter, or instrument effectuating the Recapitalization Transactions shall contain terms, conditions, representations, warranties, and covenants consistent with the terms of this Agreement, as they may be modified, amended, or supplemented in accordance with Section 13 of this Agreement.

 

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Section 4.                                          Commitments of the Consenting Stakeholders.

 

4.01.                     Affirmative Commitments.  Subject to Section 5 of this Agreement, during the Agreement Effective Period, each Consenting Stakeholder agrees in respect of all of its Company Claims/Interests severally and not jointly to:

 

(a)                                 support and take all steps reasonably necessary and desirable to consummate and complete the Recapitalization Transactions and implement the terms of the Recapitalization Term Sheet in accordance with this Agreement;

 

(b)                                 to the extent such Consenting Stakeholder holds Unsecured Notes, promptly tender all of its Unsecured Notes to consummate the Recapitalization Transactions and not withdraw its tender, and execute and deliver any and all documents necessary to consummate the transactions contemplated by the New Third Lien Notes Term Sheet in accordance with this Agreement and the New Third Lien Notes Term Sheet;

 

(c)                                  to the extent such Consenting Stakeholder holds Unsecured Notes, as soon as practicable, use commercially reasonable efforts to deliver executed instructions, submissions reports, or other ordinary course communications typically used for such transactions relating to the Exchange Offer to all applicable custodians or DTC participants, and provide a copy of such transmission (if available), to Lazard, Ducera, and Houlihan Lokey;

 

(d)                                 on or prior to the Effective Date, to the extent such Consenting Stakeholder holds Claims under the Term Loan Credit Facility, promptly execute and deliver the Amended Term Loan Credit Agreement and any and all documents necessary to consummate the transactions contemplated by the Amended Term Loan Term Sheet, including the Amended Term Loan Credit Agreement, in accordance with this Agreement and the Amended Term Loan Term Sheet;

 

(e)                                  negotiate in good faith with the other Parties and, where applicable, execute, deliver, and implement each Definitive Document in accordance with the terms of this Agreement, and any other required agreements to effectuate and consummate the Recapitalization Transactions;

 

(f)                                   use commercially reasonable efforts to give any notice, order, instruction, or direction to any applicable Agent/Trustee reasonably necessary to give effect to the Recapitalization Transactions; provided that nothing herein or in this Agreement obligates a Consenting Unsecured Noteholder or a Consenting Term Loan Lender to indemnify any Agent/Trustee; and

 

(g)                                  to the extent they become aware of same, reasonably promptly notify counsel to the Company Parties of (and in any event within two (2) Business Days after obtaining actual knowledge thereof) (i) any Governmental Body or any other third party complaints, litigations, investigations, or hearings with respect to this Agreement or the Recapitalization Transactions; (ii) any material breach by any Consenting Stakeholder in any respect of any of its obligations, representations, warranties, or covenants set forth in this Agreement; (iii)  the occurrence of, or circumstances that render reasonably foreseeable the occurrence of, any Material Adverse Effect; or (iv) any threat or taking of any action by any Entity that would, or would reasonably be expected 

 

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to, prevent, interfere with, delay, or impede the implementation or consummation of the Recapitalization Transactions in a manner materially consistent with this Agreement and/or the Recapitalization Term Sheet.

 

4.02.                     Negative Commitments.  Subject to Section 5 of this Agreement, during the Agreement Effective Period, each Consenting Stakeholder agrees in respect of all of its Company Claims/Interests severally and not jointly that it shall not directly or indirectly:

 

(a)                                 object to, delay, impede, or take any other action to, or reasonably likely to, materially interfere with the acceptance, implementation, or consummation of the Recapitalization Transactions;

 

(b)                                 propose, file, support, vote for, or consent to any Alternative Transaction Proposal;

 

(c)                                  file any motion, pleading, or other document with any court (including any modifications or amendments to any motion, pleading, or other document with any court) that, in whole or in part, is not materially consistent with this Agreement;

 

(d)                                 exercise any right or remedy for the enforcement, collection, or recovery of any of the Company Claims/Interest in connection with or arising out of the Marble Ridge Litigation, including (i) calling, providing notice of, or otherwise asserting any default, event of default, or acceleration under the Term Loan Credit Agreement or Unsecured Notes in connection with or arising out of the Marble Ridge Litigation or (ii) seeking to exercise any remedies thereunder;

 

(e)                                  initiate, or have initiated on its behalf, any litigation or proceeding of any kind against the Company Parties or any of the other Parties with respect to this Agreement, the Recapitalization Transactions, or any Company Claim/Interest other than to enforce this Agreement or any Definitive Document or as otherwise permitted under this Agreement; provided, that the foregoing shall not (subject to Section 4.02(d) of this Agreement and Section 4.03 of this Agreement) apply to enforcement of rights under the Term Loan Credit Agreement or Indentures; or

 

(f)                                   object to, delay, impede, or take any other action to interfere with the Company Parties’ ownership and possession of their assets, wherever located; provided, that the foregoing shall not (subject to Section 4.02(d) of this Agreement and Section 4.03 of this Agreement) apply to enforcement of rights under the Term Loan Credit Agreement or Indentures.

 

4.03.                     Waiver, Rescission and Amendment.  Each Consenting Term Loan Lender, by signing this Agreement, agrees to be bound by the Waiver, Rescission and Amendment under the Term Loan Credit Agreement, attached to this Agreement as Exhibit D.

 

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Section 5.                                          Additional Provisions Regarding the Consenting Stakeholders’ Commitments.  Nothing in this Agreement shall:  (a) affect the ability of any Consenting Stakeholder to consult with any other Consenting Stakeholder, the Company Parties, or any other party in interest; (b) impair or waive the rights of any Consenting Stakeholder to assert or raise any objection permitted under this Agreement in connection with the Recapitalization Transactions; (c) prevent any Consenting Stakeholder from enforcing this Agreement or contesting whether any matter, fact, or thing is a breach of, or is inconsistent with, this Agreement; or (d) subject to Section 4.03 of this Agreement, prevent any Consenting Stakeholder from enforcing the Term Loan Credit Agreement or Indentures or contesting whether any matter, fact, or thing is a breach of, or is inconsistent with, the Term Loan Credit Agreement or Indentures.  Any such action pursuant to this Section 5 shall be deemed not to constitute a breach of this Agreement.

 

Section 6.                                          Commitments of the Company Parties.

 

6.01.                     Affirmative Commitments.  Subject to Section 7 of this Agreement, during the Agreement Effective Period, each of the Company Parties agrees to:

 

(a)                                 support and take all steps reasonably necessary and desirable to consummate and complete the Recapitalization Transactions and implement the terms of the Recapitalization Term Sheet in accordance with this Agreement;

 

(b)                                 to the extent any legal or structural impediment arises that would prevent, hinder, or delay the consummation of the Recapitalization Transactions contemplated in this Agreement, support and take all steps reasonably necessary and desirable to address any such impediment;

 

(c)                                  use commercially reasonable efforts to obtain any and all regulatory and/or third-party approvals that are necessary or advisable for the Recapitalization Transactions;

 

(d)                                 negotiate in good faith with the other Parties and, where applicable, execute, deliver, and implement the Definitive Documents in accordance with the terms of this Agreement and any other required agreements to effectuate and consummate the Recapitalization Transactions;

 

(e)                                  except with respect to any actions related to the Recapitalization Transactions (or otherwise as specifically provided for under this Agreement), use commercially reasonable efforts to (i) preserve intact in all material respects the current business operations of each Company Party, and (ii) preserve in all material respects its business organization and relationships with customers, vendors, suppliers, distributors, and others, in each case, having material business dealings with the Company Parties;

 

(f)                                   to the extent they become aware of same, reasonably promptly notify counsel to the Term Loan Steering Committee and counsel to the Ad Hoc Committee of Unsecured Noteholders of (and in any event within two (2) Business Days after obtaining actual knowledge thereof) (i) any Governmental Body or any other third party complaints, litigations, investigations, or hearings with respect to this Agreement or the Recapitalization Transactions; (ii) any material breach by any Company Party in any respect of any of its obligations, representations, warranties, or covenants set forth in this Agreement; (iii)  the occurrence of, or circumstances that render

 

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reasonably foreseeable the occurrence of, any Material Adverse Effect; or (iv) any threat or taking of any action by any Entity that would, or would reasonably be expected to, prevent, interfere with, delay, or impede the implementation or consummation of the Recapitalization Transactions in a manner materially consistent with this Agreement and/or the Recapitalization Term Sheet;

 

(g)                                  maintain good standing and legal existence under the laws of the state or non-U.S. jurisdiction in which such Company Party is incorporated, organized or formed;

 

(h)                                 pay and reimburse, on a reasonably prompt basis, all Creditor Fees and Expenses;

 

(i)                                     pay when due the Noteholder Cash Joinder Payment, and otherwise pay all fees payable under any Definitive Document in accordance with the terms thereof, without setoff, deduction, or withholding for any taxes or otherwise;

 

(j)                                    pay in cash all accrued and unpaid interest accrued through the Effective Date on all Unsecured Notes that are tendered and exchanged in connection with the Recapitalization Transactions; and

 

(k)                                 agree to pay when due the fees set forth under “Fees” in the Amended Term Loan Term Sheet without setoff, deduction or withholding for any taxes or otherwise.

 

6.02.                     Negative Commitments of the Company Parties.  Subject to Section 7 of this Agreement, during the Agreement Effective Period, each of the Company Parties agrees that it shall not directly or indirectly:

 

(a)                                 object to, delay, impede, or take any other action to, or reasonably likely to, materially interfere with the acceptance, implementation, or consummation of the Recapitalization Transactions;

 

(b)                                 execute, file, or agree to execute or file any Definitive Documents (including any amendment, supplement, modification, or waiver of any Definitive Document, or any ancillary documentation in respect thereof) that, in whole or in part, are not consistent in all respects with this Agreement and/or the Recapitalization Term Sheet;

 

(c)          take any tax position, for U.S. federal  (and applicable state and local) income tax purposes, inconsistent with the treatment of the Noteholder Cash Joinder Payment as a payment of interest or principal on the Unsecured Notes; or

 

(d)         except to the extent required by Law as determined by the Company Parties in good faith and based upon the advice of counsel, disclose to any Entity (including, for the avoidance of doubt, any other Consenting Stakeholder), other than advisors to the Company Parties, the principal amount or percentage of any Company Claims/Interests held by any Consenting Stakeholder (except that the foregoing shall not prohibit the disclosure of the aggregate percentage or aggregate principal amount of Unsecured Notes or Term Loans held by all of the Consenting Stakeholders collectively).

 

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Section 7.                                          Additional Provisions Regarding Company Parties’ Commitments.

 

7.01.                     Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement shall require a Company Party or the board of directors, board of managers, or similar governing body of a Company Party, after consulting with counsel, to take any action or to refrain from taking any action with respect to the Recapitalization Transactions to the extent taking or failing to take such action would be inconsistent with applicable Law or its fiduciary obligations under applicable Law, and any such action or inaction pursuant to this Section 7.01 shall be deemed not to constitute a breach of this Agreement.

 

7.02.                     Notwithstanding anything to the contrary in this Agreement, but subject to the terms of Section 7.01 of this Agreement, each Company Party and its directors, officers, employees, investment bankers, attorneys, accountants, consultants, and other advisors or representatives shall have the right to:  (a) solicit, consider, respond to, and facilitate Alternative Transaction Proposals; (b) provide access to non-public information concerning any Company Party to any Entity or enter into Confidentiality Agreements or nondisclosure agreements with any Entity; (c) initiate, maintain, or continue discussions or negotiations with respect to Alternative Transaction Proposals; (d) otherwise cooperate with, assist, participate in, or facilitate any inquiries, proposals, discussions, or negotiation of Alternative Transaction Proposals; and (e) enter into or continue discussions or negotiations with holders of any Company Claim/Interest (including any Consenting Stakeholder), any other party in interest, or any other Entity regarding the Recapitalization Transactions or Alternative Transaction Proposals.  At all times prior to the date on which the Company Parties enter into a definitive agreement in respect of an Alternative Transaction Proposal, the Company Parties shall provide counsel to the Term Loan Steering Committee and counsel to the Ad Hoc Committee of Unsecured Noteholders with updates on the status of discussions regarding any Alternative Transaction Proposal within three (3) Business Days of the Company Parties’ or their advisors’ receipt of any such Alternative Transaction Proposal.  The Company Parties and/or the Company Parties’ advisors will make themselves reasonably available for weekly status update calls with counsel to the Ad Hoc Committee of Unsecured Noteholders and counsel to the Term Loan Steering Committee with respect to the foregoing.

 

7.03.                     Nothing in this Agreement shall:  (a) impair or waive the rights of any Company Party to assert or raise any objection permitted under this Agreement in connection with the Recapitalization Transactions; or (b) prevent any Company Party from enforcing this Agreement or contesting whether any matter, fact, or thing is a breach of, or is inconsistent with, this Agreement.

 

Section 8.                                          Transfer of Interests and Securities.

 

8.01.                     During the Restricted Period, no Consenting Stakeholder shall Transfer any ownership (including any beneficial ownership as defined in the Rule 13d-3 under the Securities Exchange Act of 1934, as amended) in any Company Claims/Interests to any affiliated or unaffiliated party, including any party in which it may hold a direct or indirect beneficial interest, unless:

 

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(a)                                 in the case of a Transfer of the Unsecured Notes, the transferee is either (i) a qualified institutional buyer as defined in Rule 144A of the Securities Act, or (ii) a non-U.S. person in an offshore transaction as defined under Regulation S under the Securities Act; and

 

(b)                                 either (i) the transferee executes and delivers to counsel to the Company Parties, before the time of the proposed Transfer, a Transfer Agreement or (ii) the transferee is a Consenting Stakeholder and the transferee provides notice of such Transfer (including the amount and type of Company Claim/Interest Transferred) to counsel to the Company Parties at or before the time of the proposed Transfer.

 

8.02.                     Notwithstanding anything to the contrary in this Section 8, at any time prior to the occurrence of the Effective Date, a Consenting Stakeholder may Transfer its Company Claims/Interests to a Party that is acting in its capacity as a Qualified Marketmaker without the requirement that the Qualified Marketmaker be or become a Consenting Stakeholder; provided that any subsequent Transfer by such Qualified Marketmaker of the right, title, or interest in such Company Claims/Interests must be to a transferee that is or becomes a Consenting Stakeholder (in accordance with the requirements set forth in Sections 8.01(a) and (b) of this Agreement).  To the extent that a Party is acting in its capacity as a Qualified Marketmaker, it may Transfer any right, title, or interest in Company Claims/Interests that the Qualified Marketmaker acquires from a lender or noteholder that is not a Party to this Agreement without the requirement that the transferee be or become a Consenting Stakeholder or execute a Transfer Agreement or Joinder.

 

8.03.                     Upon completing a Transfer in compliance with this Section 8, (i) the transferor shall be deemed to relinquish its rights and be released from its obligations under this Agreement to the extent of the rights and obligations the transferor had in respect of such transferred Company Claims/Interests, except that, notwithstanding anything to the contrary in this Agreement, such transferor shall not be deemed to relinquish its rights nor be released from its applicable obligations under Section 9 of this Agreement, and (ii) the transferee shall be deemed a “Consenting Stakeholder” (as a “Sponsor,” “Consenting Term Loan Lender,” “Consenting Cash Pay Noteholder,” and/or “Consenting PIK Toggle Noteholder,” as applicable) and “Party” under this Agreement (and, for the avoidance of doubt, if as a result of such Transfer such transferee holds any Term Loan, it shall be deemed to have agreed to be bound by the Waiver, Rescission and Amendment under the Term Loan Credit Agreement, attached to this Agreement as Exhibit D).  Subject to Section 8.02 of this Agreement, any Transfer in violation of Section 8.01 of this Agreement shall be void ab initio.

 

8.04.                     This Agreement shall in no way be construed to preclude the Consenting Stakeholders from acquiring additional Company Claims/Interests.  Notwithstanding the foregoing, (a) such additional Company Claims/Interests shall automatically and immediately upon acquisition by a Consenting Stakeholder be deemed subject to the terms of this Agreement (regardless of when or whether notice of such acquisition is given to counsel to the Company Parties or counsel to the Consenting Stakeholders) and (b) such Consenting Stakeholder must provide notice of such acquisition (including the amount and type of Company Claims/Interest acquired) to counsel to the Company Parties within five (5) Business Days of such acquisition.

 

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8.05.                     This Section 8 shall not impose any obligation on any Company Party to issue any “cleansing letter” or otherwise publicly disclose information for the purpose of enabling a Consenting Stakeholder to Transfer any of its Company Claims/Interests.  Notwithstanding anything to the contrary in this Agreement, to the extent a Company Party and another Party have entered into a Confidentiality Agreement, the terms of such Confidentiality Agreement shall continue to apply and remain in full force and effect according to its terms, and this Agreement does not supersede any rights or obligations otherwise arising under such Confidentiality Agreements.

 

Section 9.                                          Mutual Releases.

 

9.01.                     Releases by the Company Releasing Parties.  Except as expressly set forth in this Agreement, effective as of the Effective Date, for good and valuable consideration provided by each of the Released Parties, the adequacy and sufficiency of which are hereby confirmed, each of the Company Releasing Parties hereby conclusively, absolutely, unconditionally, irrevocably, and forever fully releases, remises, and discharges each of the Released Parties (and each such Released Party shall be deemed forever released, remised, and discharged by the Company Releasing Parties) and their respective assets and properties from any and all Claims and Causes of Action, including any derivative claims asserted on behalf of any of the Company Releasing Parties, that any of the Company Releasing Parties would have been legally entitled to assert in its own right (whether individually or collectively) or on behalf of the holder of any Claim against, or Equity Interest in, a Company Releasing Party or other Entity, based on or relating to, or in any manner arising from, in whole or in part, (i) the MyTheresa Designation, (ii) the MyTheresa Distribution, (iii) the Nancy Transaction, (iv) the formulation, preparation, dissemination, negotiation, or filing of this Agreement, the Definitive Documents, any Recapitalization Transaction, or any contract, instrument, release, or other agreement or document created or entered into in connection with or pursuant to this Agreement or the Definitive Documents, or (v) the pursuit of consummation, the administration or implementation of any of the Recapitalization Transactions, including the issuance or distribution of securities in connection therewith.  Notwithstanding anything to the contrary in the foregoing, the Releases set forth above do not release (1) any party or entity from their obligations under the Commitment Letter or (2) any post-Effective Date obligations of any party or Entity under this Agreement, the Definitive Documents, any Recapitalization Transaction, the Commitment Letter, or any document, instrument, or agreement executed to implement the Recapitalization Transactions.  Notwithstanding anything to the contrary in the foregoing, the Releases set forth in clauses (iv)-(v) above do not release any Claims or Causes of Action that are determined by a final non-appealable judgment of a court of competent jurisdiction to have constituted fraud or willful misconduct.  Nothing in this Agreement shall or shall be deemed to result in the waiving or limiting by any Sponsor or any officer, director, or employee of any Company Party of (a) any indemnification against, or expense reimbursement or advance by, any Company Party or any Company Party’s insurance carriers, (b) any rights as beneficiaries of any insurance policies, (c) any management fees, monitoring fees, or like fees and expenses, (d) wages, salaries, compensation, or benefits, or (e) any Equity Interests in any Company Party.  Each of the Company Releasing Parties hereby further agrees and covenants not to, and shall not, commence or prosecute, or assist or otherwise aid any other Entity in the commencement or prosecution of, whether directly, derivatively or otherwise, any Released Claims.  Notwithstanding anything to

 

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the contrary in this Section 9.01 or otherwise in this Agreement, nothing in this Agreement shall or be deemed to (or is intended to) limit any of the Company Releasing Parties’ rights to assert or prosecute any affirmative defenses or otherwise raise any defense or take any action to defend itself or themselves, including any defense available under the Bankruptcy Code, in connection with any Claim or Cause of Action (whether direct or indirect) brought by any Entity relating to any of the above-referenced Claims or Causes of Action arising from, in whole or in part, (x) the formulation, preparation, dissemination, negotiation, or filing of this Agreement, the Definitive Documents, the Commitment Letter, or any Recapitalization Transaction, or any contract, instrument, release, or other agreement or document created or entered into in connection with this Agreement or the Definitive Documents, and (y) the pursuit of consummation, the administration and implementation of the Recapitalization Transactions, including the issuance or distribution of securities in connection therewith.

 

9.02.                     Releases by the Consenting Stakeholder Releasing Parties.  Except as expressly set forth in this Agreement, effective as of the Effective Date, for good and valuable consideration provided by each of the Released Parties, the adequacy and sufficiency of which are hereby confirmed, each Consenting Stakeholder Releasing Party solely in its capacity as such, severally and not jointly, hereby conclusively, absolutely, unconditionally, irrevocably, and forever fully releases, remises, and discharges each of the Released Parties (and each such Released Party shall be deemed forever released, remised, and discharged by the Consenting Stakeholder Releasing Parties) and their respective assets and properties from any and all Claims and Causes of Action, including any derivative claims asserted on behalf of any of the Company Releasing Parties or the Consenting Stakeholder Releasing Parties, that any of the Consenting Stakeholder Releasing Parties would have been legally entitled to assert in its own right (whether individually or collectively) or on behalf of the holder of any Claim against, or Equity Interest in, a Company Releasing Party or other Entity, based on or relating to, or in any manner arising from, in whole or in part, (i) the MyTheresa Designation, (ii) the MyTheresa Distribution, (iii) the Nancy Transaction, (iv) the formulation, preparation, dissemination, negotiation, or filing of this Agreement, the Definitive Documents, any Recapitalization Transaction, or any contract, instrument, release, or other agreement or document created or entered into in connection with or pursuant to this Agreement or the Definitive Documents, or (v) the pursuit of consummation, the administration or implementation of any of the Recapitalization Transactions, including the issuance or distribution of securities in connection therewith.  Notwithstanding anything to the contrary in the foregoing, the Releases set forth above do not release (1) any party or entity from their obligations under the Commitment Letter or (2) any post-Effective Date obligations of any party or Entity under this Agreement, the Definitive Documents, any Recapitalization Transaction, the Commitment Letter, or any document, instrument, or agreement executed to implement the Recapitalization Transactions.  Notwithstanding anything to the contrary in the foregoing, the Releases set forth in clauses (iv)-(v) above do not release any Claims or Causes of Action that are determined by a final non-appealable judgment of a court of competent jurisdiction to have constituted fraud or willful misconduct.  Nothing in this Agreement shall or shall be deemed to result in the waiving or limiting by the Sponsors or any officer, director, or employee of any Company Party of (a) any indemnification against, or expense reimbursement or advance by, any Company Party or any Company Party’s insurance carriers, (b) any rights as beneficiaries of any insurance policies, (c) any management fees, monitoring fees, or like fees and expenses, (d) wages, salaries, compensation, or benefits, or (e) any Equity Interests in any Company Party.  Each of the

 

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Consenting Stakeholder Releasing Parties hereby further agrees and covenants not to, and shall not, commence or prosecute, or assist or otherwise aid any other Entity in the commencement or prosecution of, whether directly, derivatively or otherwise, any Released Claims.  Notwithstanding anything to the contrary in this Section 9.02 or otherwise in this Agreement, nothing in this Agreement shall or be deemed to (or is intended to) limit any of the Consenting Stakeholder Releasing Parties’ rights to assert or prosecute any affirmative defenses or otherwise raise any defense or take any action to defend itself or themselves, including any defense available under the Bankruptcy Code, in connection with any Claim or Cause of Action (whether direct or indirect) brought by any Entity relating to any of the above-referenced Claims or Causes of Action arising from, in whole or in part, (x) the formulation, preparation, dissemination, negotiation, or filing of this Agreement, the Definitive Documents, the Commitment Letter, or any Recapitalization Transaction, or any contract, instrument, release, or other agreement or document created or entered into in connection with this Agreement or the Definitive Documents, and (y) the pursuit of consummation, the administration and implementation of the Recapitalization Transactions, including the issuance or distribution of securities in connection therewith.

 

9.03.                     No Additional Representations and Warranties.  Each of the Parties agrees and acknowledges that, except as expressly provided in this Agreement and the Definitive Documents, no other Party or Released Party, in any capacity, has warranted or otherwise made any representations concerning any Released Claim (including any representation or warranty concerning the existence, non-existence, validity, or invalidity of any Released Claim).  Notwithstanding the foregoing, nothing contained in this Agreement is intended to impair or otherwise derogate from any of the representations, warranties, or covenants expressly set forth in this Agreement or any of the Definitive Documents.

 

9.04.                     Release of Unknown Claims.  Each of the Releasing Parties expressly acknowledges that although ordinarily a general release may not extend to any Released Claims which the Releasing Party does not know or suspect to exist in its favor, which if known by it may have materially affected its settlement with the party released, it has carefully considered and taken into account in determining to enter into the Release the possible existence of such unknown losses or claims.  Without limiting the generality of the foregoing, each Releasing Party expressly waives and relinquishes any and all rights such Party may have or conferred upon it under any federal, state, or local statute, rule, regulation, or principle of common law or equity which provides that a release does not extend to claims which the claimant does not know or suspect to exist in its favor at the time of providing the Releases set forth in Sections 9.01 or 9.02 of this Agreement or which may in any way limit the effect or scope of such Releases with respect to Released Claims, which such Party did not know or suspect to exist in such Party’s favor at the time of providing such Releases, which in each case if known by it may have materially affected its settlement with any Released Party, including any rights under Section 1542 of the California Civil Code or any analogous applicable state or federal law or regulation.  Each of the Releasing Parties expressly acknowledges that the Releases and covenants not to sue contained in this Agreement are effective regardless of whether those released matters or Released Claims are presently known or unknown, suspected or unsuspected, or foreseen or unforeseen.

 

To the extent that the Release includes releases to which Section 1542 of the California Civil Code or similar provisions of other applicable law applies, it is the intention of the Parties that the

 

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Release shall be effective as a bar to any and all Claims and Causes of Action of whatsoever character, nature and kind, known or unknown, suspected or unsuspected specified in this Agreement.  In furtherance of this intention, the Parties expressly waive any and all rights and benefits conferred upon them by the provisions of Section 1542 of the California Civil Code or similar provisions of applicable law, which are as follows:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

 

The Parties acknowledge that the foregoing waiver of the provisions of Section 1542 of the California Civil Code was bargained for separately.  Thus, notwithstanding the provisions of Section 1542 of the California Civil Code, and for the purpose of implementing a full and complete release and discharge of the Parties, and each of them, each Party expressly acknowledges that this Agreement is intended to include in its effect without limitation all of the claims, causes of action and liabilities which the Parties, and each of them, do not know or suspect to exist in their favor at the time of execution of this Agreement, and this Agreement contemplates extinguishment of all such claims, causes of action and liabilities.

 

9.05.                     Covenant to Refrain from Certain Actions.  EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT (INCLUDING IN THE LAST SENTENCES OF SECTIONS 9.01 AND 9.02 OF THIS AGREEMENT) OR THE DEFINITIVE DOCUMENTS, DURING THE AGREEMENT EFFECTIVE PERIOD AND FROM AND AFTER THE EFFECTIVE DATE, EACH OF THE RELEASING PARTIES HEREBY AGREES AND COVENANTS NOT TO, AND SHALL NOT, AND SHALL NOT ASSIST OR OTHERWISE AID ANY OTHER ENTITY TO, (A) COMMENCE OR CONTINUE, IN ANY MANNER OR IN ANY PLACE, ANY SUIT, ACTION, OR OTHER PROCEEDING; (B) ENFORCE, ATTACH, COLLECT, OR RECOVER IN ANY MANNER ANY JUDGMENT, AWARD, DECREE, OR ORDER; (C) CREATE, PERFECT, OR ENFORCE ANY LIEN OR ENCUMBRANCE; (D) ASSERT A SETOFF, RIGHT OF SUBROGATION, OR RECOUPMENT OF ANY KIND; (E) COMMENCE OR CONTINUE IN ANY MANNER ANY ACTION OR OTHER PROCEEDING OF ANY KIND, OR (F) ASSIGN, TRANSFER, OR OTHERWISE DISPOSE OF ANY CLAIM OR CAUSE OF ACTION, IN EACH CASE, ON ACCOUNT OF OR WITH RESPECT TO ANY RELEASED CLAIM OR ANY CLAIM OR CAUSE OF ACTION THAT WILL BE A RELEASED CLAIM ON THE EFFECTIVE DATE.  NOTHING IN THIS AGREEMENT SHALL OR BE DEEMED TO (OR IS INTENDED TO) LIMIT ANY OF THE CONSENTING STAKEHOLDER RELEASING PARTIES’ RIGHTS OR COMPANY RELEASING PARTIES’ RIGHTS, AS APPLICABLE, TO ASSERT OR PROSECUTE ANY AFFIRMATIVE DEFENSES OR OTHERWISE RAISE ANY DEFENSE OR TAKE ANY ACTION TO DEFEND ITSELF OR THEMSELVES, INCLUDING ANY DEFENSE AVAILABLE UNDER THE BANKRUPTCY CODE, IN CONNECTION WITH ANY CLAIM OR CAUSE OF ACTION (WHETHER DIRECT OR INDIRECT) BROUGHT BY ANY ENTITY RELATING TO ANY OF THE ABOVE-REFERENCED CLAIMS OR CAUSES OF ACTION ARISING FROM, IN WHOLE OR IN PART, (X) THE FORMULATION,

 

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PREPARATION, DISSEMINATION, NEGOTIATION, OR FILING OF THIS AGREEMENT, THE DEFINITIVE DOCUMENTS, OR ANY RECAPITALIZATION TRANSACTION, CONTRACT, INSTRUMENT, RELEASE, OR OTHER AGREEMENT OR DOCUMENT CREATED OR ENTERED INTO IN CONNECTION WITH THIS AGREEMENT OR THE DEFINITIVE DOCUMENTS, AND (Y) THE PURSUIT OF CONSUMMATION, THE ADMINISTRATION AND IMPLEMENTATION OF THE RECAPITALIZATION TRANSACTIONS, INCLUDING THE ISSUANCE OR DISTRIBUTION OF SECURITIES IN CONNECTION THEREWITH.

 

9.06.                     Turnover of Subsequently Recovered Assets.

 

(a)                                 Subject to the occurrence of the Effective Date, in the event that any Releasing Party (including any successor or assignee thereof) receives any funds, property, or value on account of any Claims, Causes of Action, or litigation against NMG or the MT Entities (or any direct or indirect parent company of such entities) arising from the MyTheresa Designation or the MyTheresa Distribution (collectively, the “Specified Claims”), such Releasing Party shall promptly turn over and assign any such funds, property, or value (including any Equity Interests in any of the MT Entities or proceeds of such Equity Interests, or any increased recoveries resulting therefrom) to, at the election of NMG, NMG or the applicable MyTheresa Entity.  NMG or the applicable MyTheresa Entity shall distribute any such recoveries turned over or assigned to it in accordance with the “Distributions upon Realization of Value” provision of Exhibit 4 to the Recapitalization Term Sheet, to the extent applicable.  Notwithstanding anything to the contrary in this Agreement (but subject to Section 9.06(b) of this Agreement), NMG shall be entitled to enforce this Section 9.06(a) on behalf of itself or any MyTheresa Entity.  The Releasing Parties will be bound by this Section 9.06 notwithstanding the nature of any Claim, Cause of Action, or litigation relating to the Recapitalization Transactions or any judgment or order entered on any such Claim, Cause of Action or litigation.

 

(b)                                 Notwithstanding anything to the contrary in this Agreement, (i) Section 9.06(a) of this Agreement shall only apply to the Releasing Parties in their capacities as holders of Initial Loans, Extended Loans, PIK Toggle Notes, Cash Pay Notes, New Second Lien Notes, New Third Lien Notes, 2028 Debentures, MT Preferred Equity, and/or Existing Common Stock and shall not, for the avoidance of doubt, apply to any Releasing Party in its capacity as a provider of debtor-in-possession or any similar financing and (ii) to the extent a Releasing Party receives consideration on account of a Claim secured by assets or property of any Company Party or its subsidiaries (other than, for the avoidance of doubt, the Specified Claims or any such assets or property contributed to or otherwise obtained by any Company Party or its subsidiaries on account of the Specified Claims), such consideration will not be subject to Section 9.06(a) of this Agreement.

 

Section 10.                                   Representations and Warranties of Consenting Stakeholders.  Each of the Consenting Stakeholders represents, warrants, and covenants to each other Party, severally, and not jointly, that, to the best of its actual knowledge, as of (i) the Execution Date and (ii) the Effective Date (but, in respect of the foregoing (ii), subject to changes resulting from any Transfers made pursuant to Section 8 of this Agreement):

 

(a)                                 (i) it is the sole beneficial or record owner of the face amount of the Company

 

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Claims/Interests or is the nominee, investment manager, or advisor for beneficial holders of the Company Claims/Interests reflected in, (ii) it is the sole legal and beneficial owner of all Claims and Causes of Actions released by it pursuant to Section 9 of this Agreement and has not Transferred, or agreed to Transfer (other than in accordance with Section 8 of this Agreement), in whole or in part, any Claim or Cause of Action with respect to its Company Claims/Interests that is subject to the Releases in Section 9 of this Agreement, and, (iii) having made reasonable inquiry, it is not the beneficial or record owner of any Company Claims/Interests other than those reflected in, such Consenting Stakeholder’s signature page to this Agreement or a Transfer Agreement, as applicable (as may be updated as a result of any Transfers pursuant to Section 8 of this Agreement);

 

(b)                                 it has the full power and authority to act on behalf of, vote and consent to matters concerning, such Company Claims/Interests;

 

(c)                                  such Company Claims/Interests are free and clear of any pledge, lien, security interest, charge, claim, equity, option, proxy, voting restriction, right of first refusal, or other limitation on disposition, transfer, or encumbrances of any kind, that would adversely affect in any way such Consenting Stakeholder’s ability to perform any of its obligations under this Agreement at the time such obligations are required to be performed;

 

(d)                                 it has the full power to vote, approve changes to, and transfer all of its Company Claims/Interests referable to it as contemplated by this Agreement subject to applicable Law; and

 

(e)                                  solely with respect to holders of Company Claims/Interests constituting securities, (i) it is either (A) a qualified institutional buyer as defined in Rule 144A of the Securities Act, (B) not a U.S. person (as defined in Regulation S of the Securities Act), or (C) an institutional accredited investor (as defined in the Rules), and (ii) any securities acquired by the Consenting Stakeholder in connection with the Recapitalization Transactions will have been acquired for investment and not with a view to distribution or resale in violation of the Securities Act.

 

Section 11.                                   Mutual Representations, Warranties, and Covenants.  Each of the Parties represents, warrants, and covenants to each other Party, severally, and not jointly, that, to the best of its actual knowledge, as of the Execution Date and as of the Effective Date:

 

(a)                                 it is validly existing and in good standing under the Laws of the state of its organization, and this Agreement is a legal, valid, and binding obligation of such Party, enforceable against it in accordance with its terms, except as may be limited by applicable Laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability;

 

(b)                                 except as expressly provided in this Agreement, no consent or approval is required by any Entity in order for it to effectuate the Recapitalization Transactions contemplated by, and perform its respective obligations under, this Agreement;

 

(c)                                  the entry into and performance by it of, and the transactions contemplated by, this Agreement do not, and will not, conflict in any material respect with any Law or regulation applicable to it or with any of its articles of association, memorandum of association or other constitutional documents;

 

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(d)                                 except as expressly provided in this Agreement, it has (or will have, at the relevant time) all requisite corporate or other power and authority to enter into, execute, and deliver this Agreement and to effectuate the Recapitalization Transactions contemplated by, and perform its respective obligations under, this Agreement; and

 

(e)                                  it is not (i) party to any restructuring or similar agreements or arrangements relating to the Company or its Affiliates with the other Parties to this Agreement that have not been disclosed to all Parties to this Agreement or (ii) participating in, or a party to, (as applicable) any agreement, understanding, negotiation, or discussion (in each case, whether oral or written) with respect to any Alternative Transaction Proposal.

 

Section 12.                                   Termination Events.

 

12.01.              Consenting Stakeholder Termination Events.  This Agreement (A) may be terminated upon the occurrence of any of the Events set forth in clauses (a) through (m) below, (1) as to the Consenting Term Loan Lenders, by the Required Consenting Term Loan Lenders, (2) as to the Consenting Unsecured Noteholders, by the Required Consenting Unsecured Noteholders, and (3) as to either Sponsor, by such Sponsor, in each case by the delivery to the Parties of a written notice in accordance with Section 14.10 of this Agreement; or (B) may be terminated upon the occurrence of the Event set forth in clause (m) below as to any individual Consenting Stakeholder by the delivery by such Consenting Stakeholder to the other Parties of a written notice in accordance with Section 14.10 of this Agreement:

 

(a)                                 the breach in any material respect by a Party (other than by any Consenting Stakeholders asserting such breach) of any of the representations, warranties, covenants, or commitments of the Party set forth in this Agreement that (i) is adverse to the Consenting Stakeholders seeking termination pursuant to this provision or could reasonably be expected to have a material adverse impact on the timely consummation of the Recapitalization Transactions and (ii) remains uncured for seven (7) Business Days after such terminating Consenting Stakeholders transmit a written notice in accordance with Section 14.10 of this Agreement detailing any such breach; provided, that for the avoidance of doubt, the execution, amendment, or modification of this Agreement or any Definitive Document (as applicable) without obtaining the requisite consent(s) set forth in this Agreement (including Section 3 and Section 13 of this Agreement) or in such Definitive Document, as applicable, constitutes a material breach for purposes hereof;

 

(b)                                 only with respect to the Consenting Unsecured Noteholders and/or the Consenting Term Loan Lenders, if the Ares Sponsor, the CPPIB Sponsor, or any Company Party publicly announces its intention to pursue an Alternative Transaction Proposal, or renounces this Agreement and/or the Recapitalization Transactions;

 

(c)                                  only as to the Consenting Term Loan Lenders, if (i) the Commitment Letter is terminated, rescinded, breached in any material respect, or renounced by any party to the Commitment Letter, or otherwise ceases to be in full force and effect, except in connection with a funding under the Commitment Letter (or any funding under the Commitment Letter ceases to be subject to an escrow for purposes of funding the Recapitalization Transactions prior to the

 

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Effective Date), or is amended, modified, waived, or supplemented in any manner that is adverse to the Consenting Term Loan Lenders seeking termination pursuant to this provision; and (ii) such Event remains uncured for five (5) Business Days after the Required Consenting Term Loan Lenders transmit a written notice in accordance with Section 14.10 of this Agreement detailing any such Event (it being understood that such Event may be cured if the Commitment Letter is replaced by a commitment on terms not materially less favorable to the Consenting Term Loan Lenders in any respect);

 

(d)                                 only as to the Consenting Unsecured Noteholders, if (i) (A) the Commitment Letter is terminated, rescinded, breached in any material respect, or renounced by the Ares Sponsor, the CPPIB Sponsor, or any Company Party, or the Commitment Letter is amended, modified, waived, or supplemented (in each case, other than by any Consenting Unsecured Noteholder party thereto) in any manner that is adverse to the Consenting Unsecured Noteholders seeking termination pursuant to this provision; and (B) such Event remains uncured for five (5) Business Days after the Required Consenting Unsecured Noteholders transmit a written notice in accordance with Section 14.10 of this Agreement detailing any such Event (it being understood that such Event may be cured if the Commitment Letter is replaced by a commitment on terms not materially less favorable to the Consenting Unsecured Noteholders in any respect provided that the termination, rescindment, breach in any material respect, or renunciation of the Commitment Letter by the Ares Sponsor or CPPIB Sponsor cannot be cured with a replacement commitment by a party other than the Ares Sponsor or CPPIB Sponsor); or (ii) without the prior written consent of the Required Consenting Unsecured Noteholders, the Recapitalization Term Sheet or any executed Definitive Documents are amended, modified, or executed (as applicable) in a manner that is inconsistent in any respect with the terms, conditions and covenants relating to and effecting the agreements regarding the MT Preferred Equity set forth in the Recapitalization Term Sheet;

 

(e)                                  only as to the Sponsors, if (i) the Commitment Letter is terminated, rescinded, breached in any material respect, or renounced by any of the Consenting Unsecured Noteholders (other than any Sponsor) party thereto, or is amended, modified, waived, or supplemented (in each case, other than by any Sponsor) in any manner that is adverse to the Sponsor seeking termination pursuant to this provision; and (ii) such Event remains uncured for five (5) Business Days after such terminating Sponsor transmits a written notice in accordance with Section 14.10 of this Agreement detailing any such Event (it being understood that such Event may be cured if the Commitment Letter is replaced by a commitment on terms not materially less favorable to the Sponsors in any respect);

 

(f)                                   any Company Party executes, amends, or modifies the Recapitalization Term Sheet or any executed Definitive Document in a manner that is (i) inconsistent in any respect with the terms set forth in the Recapitalization Term Sheet or this Agreement, the other rights and benefits granted to, or received by the Consenting Stakeholders pursuant to the Recapitalization Term Sheet or this Agreement (including any Consenting Stakeholders’ consent rights regarding any Definitive Document), or the implementation thereof, unless, in the case of amendment or modification of any Definitive Document, such amendment or modification is otherwise consented to in accordance with Section 13 of this Agreement and/or the applicable provisions of the Recapitalization Term Sheet, or (ii) adverse to the Consenting Stakeholders seeking termination pursuant to this provision, and (iii) in each case of (i) and (ii) of this subsection (f), remains uncured

 

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for three (3) Business Days after such terminating Consenting Stakeholders transmit a written notice in accordance with Section 14.10 of this Agreement detailing any such Event;

 

(g)                                  the issuance by any governmental authority, including any regulatory authority or court of competent jurisdiction, of any ruling or order that (i) enjoins the consummation of a material portion of the Recapitalization Transactions and (ii) remains in effect for twenty (20) Business Days.  This termination right may not be exercised by any Party that sought or requested such ruling or order in contravention of any obligation set out in this Agreement;

 

(h)                                 the failure of the Company Parties to confirm by not later than three (3) Business Days prior to the Effective Date that the Series A MT Preferred Equity has been declared to be a security eligible for distribution by DTC and was agreed to be accepted by DTC for the DTC’s book-entry, delivery, settlement and depository services;

 

(i)                                     upon the occurrence of a Material Adverse Effect;

 

(j)                                    only as to the Consenting Unsecured Noteholders and/or the Consenting Term Loan Lenders, if a Default or Event of Default (as defined in the Term Loan Credit Agreement or any of the Indentures) under the Term Loan Credit Agreement or any Indenture (and other than as expressly set forth in the Waiver, Rescission and Amendment under the Term Loan Credit Agreement, attached to this Agreement as Exhibit D) has occurred and is continuing;

 

(k)                                 any of (i) the Company Parties, (ii) the Required Consenting Unsecured Noteholders, (iii) the Required Consenting Term Loan Lenders, or (iv) the Sponsors, respectively, validly terminates this Agreement in accordance with its terms;

 

(l)                                     the Exchange Offer has not launched by April 22, 2019; or

 

(m)                             the Effective Date has not occurred by June 10, 2019.

 

12.02.              Company Party Termination Events.  Any Company Party may terminate this Agreement as to all Parties upon prior written notice to all Parties in accordance with Section 14.10 of this Agreement upon the occurrence of any of the following Events:

 

(a)                                 the breach in any material respect by one or more of the Consenting Stakeholders of any provision set forth in this Agreement that (i) is adverse to the Company Party seeking termination under this provision and could reasonably be expected to have a material adverse impact on the timely consummation of the Recapitalization Transactions and (ii) remains uncured for a period of ten (10) Business Days after the Company Party transmits a written notice in accordance with Section 14.10 of this Agreement detailing any such breach;

 

(b)                                 the board of directors, board of managers, or such similar governing body of any Company Party determines, after consulting with counsel, (i) that proceeding with any of the Recapitalization Transactions would be inconsistent with the exercise of its fiduciary duties or applicable Law or (ii) in the exercise of its fiduciary duties, to pursue an Alternative Transaction Proposal;

 

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(c)                                  the issuance by any governmental authority, including any regulatory authority or court of competent jurisdiction, of any ruling or order that (i) enjoins the consummation of a material portion of the Recapitalization Transactions and (ii) remains in effect for twenty (20) Business Days after the terminating Company Party transmits a written notice in accordance with Section 14.10 of this Agreement detailing any such issuance.  This termination right shall not apply to or be exercised by any Company Party that sought or requested such ruling or order in contravention of any obligation or restriction set out in this Agreement;

 

(d)                                 (i) the Commitment Letter is terminated, rescinded, or renounced by a purchaser party thereto, or otherwise ceases to be in full force and effect, except in connection with a funding thereunder, (ii) such Event is adverse to the Company Party seeking termination pursuant to this provision; and (iii) such Event remains uncured for seven (7) Business Days after such terminating Company Party transmits a written notice in accordance with Section 14.10 of this Agreement detailing any such Event (it being understood that such Event may be cured if the Commitment Letter is replaced by a commitment on terms not materially less favorable to the Company Parties);

 

(e)                                  the Exchange Offer has not launched by April 22, 2019;

 

(f)                                   the Effective Date has not occurred by June 10, 2019; or

 

(g)                                  any of (i) the Required Consenting Unsecured Noteholders, (ii) the Required Consenting Term Loan Lenders, or (iii) the Sponsors, respectively, validly terminates this Agreement in accordance with its terms.

 

12.03.              Mutual Termination.  This Agreement, and the obligations of all Parties hereunder, may be terminated by mutual written agreement among all of the following:  (a) the Required Consenting Term Loan Lenders; (b) the Required Consenting Unsecured Noteholders; (c) the Sponsors; and (d) each Company Party.

 

12.04.              Automatic Termination.  This Agreement shall terminate automatically as to all Parties without any further required action or notice upon the occurrence of any of the following Events:

 

(a)                                 immediately after the occurrence of the Effective Date;

 

(b)                                 unless already terminated pursuant to Section 12.01 of this Agreement, immediately after the execution of definitive documents in respect of, or consummation of, an Alternative Transaction Proposal;

 

(c)                                  any of the Company Parties (i) commences a voluntary case under the Bankruptcy Code, (ii) consents to the appointment of, or taking possession by, a receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the Company Party or all or substantially all of the property or assets of the Company Party, or (iii) makes any general assignment for the benefit of its creditors; or

 

(d)                                 the commencement of an involuntary bankruptcy case against any of the Company Parties under the Bankruptcy Code, if such involuntary case is not dismissed within sixty (60)

 

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calendar days after the filing thereof or if a court order granting the petition for such involuntary bankruptcy case is entered and not reversed or rescinded within 30 calendar days.

 

12.05.              Effect of Termination.

 

(a)                                 Upon the occurrence of a Termination Date as to a Party, this Agreement (except as set forth in subsection 12.05(b) of this Agreement, below) shall be of no further force and effect as to such Party, and each Party subject to such termination shall be released from its commitments, undertakings, and agreements under or related to this Agreement; any and all tenders, consents, or votes tendered by such Party shall be (or automatically shall be deemed) withdrawn; and such Party shall have the rights and remedies that it would have had, had it not entered into this Agreement, and shall be entitled to take any and all actions, whether with respect to the Recapitalization Transactions or otherwise, that it would have been entitled to take had it not entered into this Agreement, including with respect to any and all Claims or Causes of Action; provided, for the avoidance of doubt, the termination of this Agreement as to any Party shall not relieve such Party of liability for breach of this Agreement prior to such termination.

 

(b)                                 Notwithstanding anything to the contrary in this Agreement, (a) Section 1.01 of this Agreement, Section 6.01(h) of this Agreement, Section 9 of this Agreement (including the Release and the ongoing obligations contained in Section 9.05 and Section 9.06 of this Agreement), Section 12.05 of this Agreement, and Section 14 of this Agreement shall survive in the event that the Termination Date occurs due to the occurrence of the Effective Date pursuant to Section 12.04(a) of this Agreement, and (b) Section 1.01 of this Agreement, Section 6.01(h) of this Agreement (solely with respect to Creditor Fees and Expenses through the applicable Termination Date), Section 12.05 of this Agreement, and Sections 14.01 through 14.22 of this Agreement shall survive the occurrence of the Termination Date on any account.  For the avoidance of doubt, the Release and any of the ongoing obligations in Section 9 of this Agreement shall cease and be of no further force or effect whatsoever if this Agreement terminates or is terminated or a Termination Date occurs as to any or all Parties for any reason that is not the occurrence of the Effective Date as provided in Section 12.04(a) of this Agreement; provided, that if this Agreement is terminated only with respect to certain parties, such termination shall not affect the applicability or force of Section 9 of this Agreement with respect to other parties.

 

(c)                                  Nothing in this Agreement shall be construed as prohibiting a Company Party or any of the Consenting Stakeholders from contesting whether any termination is in accordance with its terms or to seek enforcement of any rights under this Agreement that arose or existed before a Termination Date.  Except as expressly provided in this Agreement (including, for the avoidance of doubt, Section 9 of this Agreement), nothing in this Agreement is intended to, or does, in any manner waive, limit, impair, or restrict (i) any right of any Company Party or the ability of any Company Party to protect and reserve its rights (including rights under this Agreement), remedies, and interests, including its claims against any Consenting Stakeholder, and (ii) any right of any Consenting Stakeholder, or the ability of any Consenting Stakeholder, to protect and preserve its rights (including rights under this Agreement), remedies, and interests, including its claims against any Company Party, Consenting Stakeholder.  Nothing in this Section 12.05 shall restrict any Company Party’s right to terminate this Agreement in accordance with Section 12.02(b) of this Agreement.

 

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(d)                                 To the extent the Term Loan Lender Participation Threshold Condition Precedent is satisfied and the Agreement is subsequently terminated (a) by the Company Parties for any reason other than pursuant to Section 12.02(a) of this Agreement due to the material breach of this Agreement by one or more Consenting Term Loan Lenders, (b) pursuant to Section 12.01(m) of this Agreement or Section 12.02(f) of this Agreement, above, or (c) otherwise because the Noteholder Participation Threshold Condition Precedent is not satisfied, the Company Parties shall pay to each Initial Consenting Term Loan Lender the Initial Consenting Term Loan Lenders Break Fee.  Notwithstanding anything in this Agreement to the contrary, the Initial Consenting Term Loan Lenders Break Fee shall be earned in full as of the Agreement Effective Date, shall not be treated as a payment on any Term Loan, and shall be due and payable subject solely to the occurrence and within one (1) Business Day of the date of such termination, without setoff, deduction or withholding for any taxes or otherwise.

 

(e)                                  To the extent the Noteholder Participation Threshold Condition Precedent is satisfied and the Agreement is subsequently terminated (a) by the Company Parties for any reason other than pursuant to Section 12.02(a) of this Agreement due to the material breach of this Agreement by one or more Consenting Unsecured Noteholders, (b) pursuant to Section 12.01(m) of this Agreement or Section 12.02(f) of this Agreement, above, or (c) otherwise because the Term Loan Lender Participation Threshold Condition Precedent is not satisfied, the Company Parties shall pay to each Initial Consenting Unsecured Noteholder the Initial Consenting Unsecured Noteholders Break Fee.  Notwithstanding anything in this Agreement to the contrary, the Initial Consenting Unsecured Noteholders Break Fee shall be earned in full as of the Agreement Effective Date, shall not be treated as a payment on any Unsecured Note, and shall be due and payable subject solely to the occurrence and within one (1) Business Day of the date of such termination, without setoff, deduction or withholding for any taxes or otherwise.

 

Section 13.                                   Amendments and Waivers.

 

(a)                                 This Agreement and, prior to the Effective Date, the Definitive Documents, may not be modified, amended, or supplemented, and no condition or requirement of this Agreement may be waived, in any manner except in accordance with this Section 13.

 

(b)                                 This Agreement (including for the avoidance of doubt, any provision in the Recapitalization Term Sheet or any exhibits and schedules hereto and thereto) and, prior to the Effective Date, the Definitive Documents, may be modified, amended, or supplemented, or a condition or requirement of this Agreement may be waived, exclusively, in a writing signed by:  (i) each Company Party and (ii) the following Parties: (A) if such modification, amendment, supplement, or waiver has an adverse effect on the Consenting Term Loan Lenders (including by improving the Principal Terms offered to any other Consenting Stakeholder), the Required Consenting Term Loan Lenders; (B) if such modification, amendment, supplement, or waiver has an adverse effect on the Consenting Cash Pay Noteholders or the Consenting PIK Toggle Noteholders (including by improving the Principal Terms offered to any other Consenting Stakeholder), the Required Consenting Unsecured Noteholders; and (C) if such modification, amendment, supplement, or waiver has an adverse effect on the Sponsors (including by improving the Principal Terms offered to any other Consenting Stakeholder), each Sponsor.  Notwithstanding 

34











 

the foregoing, (x) if the proposed modification, amendment, waiver, or supplement has a material, disproportionate, and adverse effect on any Consenting Stakeholder, then the consent of each such affected Consenting Stakeholder shall also be required to effectuate such modification, amendment, waiver, or supplement; and (y) no amendment, modification, waiver, or supplement to this Agreement (or, prior to the Effective Date, any Definitive Document) shall amend, modify or otherwise affect any Principal Term without the prior written consent of each Party to this Agreement.  Notwithstanding anything to the contrary in this Section 13, the deadline in Section 12.01(m) of this Agreement may be extended by up to 30 days with the prior written consent of each of (i) the Company Parties, (ii) the Sponsors, (iii) the Required Consenting Term Loan Lenders, and (iv) the Required Consenting Unsecured Noteholders; provided that (1) the deadline in Section 12.02(f) of this Agreement is simultaneously extended to a date no earlier than the deadline in Section 12.01(m) of this Agreement (as so extended), and (2) immediately prior to such extension, the Company Parties shall pay to each Consenting Term Loan Lender who agrees to such extension the Term Loan Lender Extension Fee.

 

(c)                                  Any proposed modification, amendment, waiver or supplement that does not comply with this Section 13 shall be ineffective and void ab initio.

 

(d)                                 The waiver by any Party of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach.  No failure on the part of any Party to exercise, and no delay in exercising, any right, power or remedy under this Agreement shall operate as a waiver of any such right, power or remedy or any provision of this Agreement, nor shall any single or partial exercise of such right, power or remedy by such Party preclude any other or further exercise of such right, power or remedy or the exercise of any other right, power or remedy.  All remedies under this Agreement are cumulative and are not exclusive of any other remedies provided by Law.

 

Section 14.                                   Miscellaneous.

 

14.01.              Acknowledgement.  Notwithstanding any other provision in this Agreement, this Agreement is not and shall not be deemed to be an offer with respect to any securities.  Any such offer or solicitation will be made only in compliance with all applicable securities Laws, and/or other applicable Law.

 

14.02.              Exhibits Incorporated by Reference; Conflicts.  Each of the exhibits, annexes, signatures pages, and schedules attached to this Agreement is expressly incorporated in this Agreement and made a part of this Agreement, and all references to this Agreement shall include such exhibits, annexes, signature pages, and schedules.

 

14.03.              Further Assurances.  Subject to the other terms of this Agreement, the Parties agree to execute and deliver such other instruments and perform such acts, in addition to the matters in this Agreement specified, as may be reasonably appropriate or necessary from time to time, to effectuate the intent of this Agreement.

 

14.04.              Complete Agreement.  Except as otherwise explicitly provided in this Agreement, this Agreement constitutes the entire agreement among the Parties with respect to the subject 

35











 

matter of this Agreement and supersedes all prior agreements, oral or written, among the Parties with respect to the subject matter of this Agreement, other than any Confidentiality Agreement.

 

14.05.              GOVERNING LAW; SUBMISSION TO JURISDICTION; SELECTION OF FORUM.  THIS AGREEMENT IS TO BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN SUCH STATE, WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES OF ANY SUCH CONTRACTS.  Each Party to this Agreement agrees that it shall bring any action or proceeding in respect of any claim arising out of or related to this Agreement, to the extent possible, in the Federal District Court for the Southern District of New York in New York City, New York, and solely in connection with claims arising under this Agreement:  (a) irrevocably submits to the exclusive jurisdiction of such court; (b) waives any objection to laying venue in any such action or proceeding in such court; and (c) waives any objection that such court is an inconvenient forum or does not have jurisdiction over any Party to this Agreement.

 

14.06.              TRIAL BY JURY WAIVER.  EACH PARTY TO THIS AGREEMENT IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

14.07.              Execution of Agreement.  This Agreement may be executed and delivered in any number of counterparts and by way of electronic signature and delivery, each such counterpart, when executed and delivered, shall be deemed an original, and all of which together shall constitute the same agreement.  Except as expressly provided in this Agreement, each individual executing this Agreement on behalf of a Party has been duly authorized and empowered to execute and deliver this Agreement on behalf of said Party.

 

14.08.              Rules of Construction.  This Agreement is the product of negotiations among the Company Parties and the Consenting Stakeholders, and in the enforcement or interpretation of this Agreement, is to be interpreted in a neutral manner, and any presumption with regard to interpretation for or against any Party by reason of that Party having drafted or caused to be drafted this Agreement, or any portion of this Agreement, shall not be effective in regard to the interpretation of this Agreement.  The Company Parties and the Consenting Stakeholders were each represented by counsel during the negotiations and drafting of this Agreement and continue to be represented by counsel.

 

14.09.              Successors and Assigns; Third Parties.  This Agreement is intended to (and does) bind and inure to the benefit of the Parties and their respective successors and permitted assigns, as applicable.  There are no third party beneficiaries under this Agreement, except for the Released Parties (solely with respect to Section 9 of this Agreement).  The rights or obligations of any Party under this Agreement may not be assigned, delegated, or transferred to any other Entity except as expressly permitted in this Agreement.

 

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14.10.              Notices.  All notices hereunder shall be deemed given if in writing and delivered, by electronic mail, courier, or registered or certified mail (return receipt requested), to the following addresses (or at such other addresses as shall be specified by like notice):

 

(a)                                 if to a Company Party, to:

 

Neiman Marcus Group, Inc.
 One Marcus Square

1618 Main Street

Dallas, TX 75201

Attn: Tracy M. Preston
 E-mail address: tracy.preston@neimnamarcus.com

 

with copies to:

 

Kirkland & Ellis LLP

333 South Hope Street

Los Angeles, CA 90071

Attn:  David Nemecek, P.C.; Nisha Kanchanapoomi, P.C.; Philippa Bond, P.C.

E-mail address: david.nemecek@kirkland.com;

nisha.kanchanapoomi@kirkland.com; pippa.bond@kirkland.com

 

and

 

Kirkland & Ellis LLP

300 North LaSalle Street

Chicago, IL 60654

Attn:  Anup Sathy, P.C.; Spencer Winters

E-mail address: anup.sathy@kirkland.com; spencer.winters@kirkland.com

 

and

 

Kirkland & Ellis LLP

601 Lexington Avenue
 New York, NY 10022
 Attn:  Matthew Fagen
 E-mail address:  matthew.fagen@kirkland.com

 

(b)                                 if to the Ares Sponsor, to:

 

Ares Corporate Opportunities Fund III, L.P. and Ares Corporate Opportunities

Fund IV, L.P.

2000 Avenue of the Stars, 12th Floor

Los Angeles, CA 90067

Attn: Eric Waxman

E-mail address: ewaxman@aresmgmt.com

 

37











 

(c)                                  if to the CPPIB Sponsor, to:

 

Canada Pension Plan Investment Board

One Queen Street East

Toronto, Ontario M5C 2W4

Attn: Lori Hall-Kim

E-mail address: lhallkim@cppib.com

 

with copies to:

 

Debevoise & Plimpton LLP

919 Third Avenue

New York, NY 10022

Attn: My Chi To

E-mail address: mcto@debevoise.com

 

(d)                                 if to a Consenting Term Loan Lender, to:

 

Wachtell, Lipton, Rosen & Katz

51 West 52nd Street

New York, NY 10019

Attn: Joshua A. Feltman, Michael S. Benn

E-mail address: jafeltman@wlrk.com; MSBenn@wlrk.com

 

(e)                                  if to a Consenting Cash Pay Noteholder or a Consenting PIK Toggle Noteholder, to:

 

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, NY 10019

Attn: Alice B. Eaton, Andrew N. Rosenberg

E-mail address:  aeaton@paulweiss.com; arosenberg@paulweiss.com

 

Any notice given by delivery, mail, or courier shall be effective when received.

 

14.11.              Independent Due Diligence and Decision Making.  Each Consenting Stakeholder hereby confirms that its decision to execute this Agreement has been based upon its independent investigation of the operations, businesses, financial and other conditions, and prospects of the Company Parties.

 

14.12.              Relationship Among Parties.  Notwithstanding anything in this Agreement to the contrary, the representations, warranties, duties and obligations of the Consenting Stakeholders under this Agreement shall be several, not joint.  It is understood and agreed that no Consenting Stakeholder has any duty of trust or confidence in any kind or form with any Party, and, except as

 

38











 

expressly provided in this Agreement, there are no commitments among or between them.  In this regard, it is understood and agreed that any Consenting Stakeholder may trade in the Company Claims/Interests without the consent of any other Party, subject to applicable securities laws and the terms of this Agreement.  No Party to this Agreement shall have any responsibility with respect to the Transfer of any Company Claims/Interests by any other Party by virtue of this Agreement.  No prior history, pattern or practice of sharing confidences among or between the Parties shall in any way affect or negate this understanding and agreement.  No Party shall, as a result of its entering into and performing its obligations under this Agreement, be deemed to be part of a “group” (as that term is used in Section 13(d) of the Exchange Act) with any other Party.  For the avoidance of doubt, no action taken by a Party pursuant to this Agreement shall be deemed to constitute or to create a presumption by any of the Parties that any or all of the Parties are in any way acting in concert or as such a “group.”  The execution of this Agreement by any Party shall not create, or be deemed to create, any fiduciary or other duties (actual or implied) to any other Party other than non-fiduciary duties as expressly set forth in this Agreement.

 

14.13.              Independent Determination of Company Parties.  The Company Parties hereby acknowledge that, in connection with negotiations regarding the Recapitalization Transactions, the Company Parties determined that the issuers under the Unsecured Notes Indentures would add one or more co-issuers to the Unsecured Notes if necessary to effect a financial recapitalization of the Company Parties and that any amendment to the Unsecured Notes Indentures to add a co-issuer would not require the prior consent of any Unsecured Noteholders.

 

14.14.              Public Disclosure.  At all times prior to the Effective Date or the earlier termination of this Agreement in accordance with its terms, the Parties shall use commercially reasonable efforts to consult with one another prior to issuing any press releases or other public notices with respect to the transactions contemplated hereby, and to provide each other with a reasonable amount of time (and not less than one day, unless otherwise agreed) to review and comment on any such press release or other notice before it is made and shall consider in good faith any comments made by such reviewing party.  The Parties are expressly permitted to disclose this Agreement or its terms (i) in accordance with any applicable Law, rule or regulation, (ii) to the extent this Agreement or such terms become available to the public other than as a result of a disclosure by such Party or its advisors, and (iii) in connection with the enforcement of any of such Party’s rights or remedies under this Agreement or any Definitive Document.  Except (w) as required by applicable Law, (x) to the extent such information becomes available to the public other than as a result of a disclosure by such Party or its advisors, (y) in connection with the enforcement of any of such Party’s rights or remedies under this Agreement or any Definitive Document, or (z) as otherwise permitted under the terms of any other agreement between the Company Parties and any Consenting Stakeholder, no Party or its advisors shall disclose to any Entity, other than the Company and the advisors to the Company, the principal amount of Company Claims/Interests held by any Consenting Stakeholder, without such Consenting Stakeholder’s prior written consent; provided, that (x) if such disclosure is required by Law, subpoena, or other legal process or regulation, the disclosing Party shall afford the relevant Consenting Stakeholder a reasonable opportunity to review and comment in advance of such disclosure and shall take all reasonable measures to limit such disclosure (the expense of which, if any, shall be borne by the relevant Consenting Stakeholder) and (y) the foregoing shall not prohibit the disclosure of the aggregate percentage or aggregate outstanding amount of the Unsecured

 

39











 

Notes and Term Loans held by all of the Consenting Stakeholders, all of the Consenting Term Loan Lenders, or all of the Consenting Unsecured Noteholders, collectively.

 

14.15.              FRE 408.  If the Recapitalization Transactions are not consummated, or if this Agreement is terminated for any reason, the Parties fully reserve any and all of their rights.  Pursuant to Federal Rule of Evidence 408 and any other applicable rules of evidence, this Agreement and all negotiations relating to this Agreement shall not be admissible into evidence in any proceeding other than a proceeding to enforce its terms or the payment of damages to which a Party may be entitled under this Agreement.

 

14.16.              Specific Performance.  It is understood and agreed by the Parties that money damages would be an insufficient remedy for any breach of this Agreement (including Section 9 of this Agreement) by any Party, and each non-breaching Party shall be entitled to specific performance and injunctive or other equitable relief (without the posting of any bond and without proof of actual damages) as a remedy of any such breach, including an order of any court of competent jurisdiction requiring any Party to comply promptly with any of its obligations hereunder.

 

14.17.              Several, Not Joint, Claims.  Except where otherwise specified, the agreements, representations, warranties, and obligations of the Parties under this Agreement are, in all respects, several and not joint.

 

14.18.              Severability and Construction.  If any provision of this Agreement shall be held by a court of competent jurisdiction to be illegal, invalid, or unenforceable, the remaining provisions shall remain in full force and effect if essential terms and conditions of this Agreement for each Party remain valid, binding, and enforceable.

 

14.19.              Remedies Cumulative.  All rights, powers, and remedies provided under this Agreement or otherwise available in respect of this Agreement at Law or in equity shall be cumulative and not alternative.  The exercise of any right, power, or remedy by any Party shall not preclude the simultaneous or later exercise of any other such right, power, or remedy by such Party.

 

14.20.              Capacities of Consenting Stakeholders.  Each Consenting Stakeholder has entered into this Agreement on account of all Company Claims/Interests that it holds (directly or through discretionary accounts that it manages or advises) and, except where otherwise specified in this Agreement, shall take or refrain from taking all actions that it is obligated to take or refrain from taking under this Agreement with respect to all such Company Claims/Interests.

 

14.21.              Email Consents.  Where a written consent, acceptance, approval, or waiver is required pursuant to or contemplated by this Agreement, pursuant to Section 3 of this Agreement, Section 13 of this Agreement, or otherwise, including a written approval by the Company Parties or the Required Consenting Stakeholders, such written consent, acceptance, approval, or waiver shall be deemed to have occurred if, by agreement between counsel to the Parties submitting and receiving such consent, acceptance, approval, or waiver, it is conveyed in writing (including electronic mail) between each such counsel without representations or warranties of any kind on behalf of such counsel.

 

40












 

14.22.              Payment Responsibility.  Notwithstanding anything to the contrary in this Agreement, including the Recapitalization Term Sheet, the MT Operating Entities shall not be responsible for the payment of any fees or the reimbursement of any expenses, including any Consenting Creditor Fees and Expenses, any consent or participation fees, or any break fees, pursuant to this Agreement, including the Recapitalization Term Sheet.

 

14.23.              Negative Commitments of the Company Parties and Sponsors.  During the Agreement Effective Period, each of the Company Parties and each of the Sponsors agrees, severally and not jointly, that it shall not, nor shall it permit any applicable affiliate to, directly or indirectly (a) terminate, rescind, or renounce the Commitment Letter, or otherwise cause the Commitment Letter to cease to be in full force and effect, except in connection with a funding under the Commitment Letter (or cause any funding under the Commitment Letter to cease to be subject to an escrow for purposes of funding the Recapitalization Transactions prior to the Effective Date), or (b) amend, modify, waive, or supplement the Commitment Letter, or any fee letter or other related agreement, in any manner that would (i) increase the fees payable in connection therewith, (ii) increase the conditionality to the funding of the commitments thereunder or (iii) otherwise reasonably be expected to hinder or delay funding thereunder.

 

14.24.              Cleansing Obligations Relating to Amendment Requests.  Contemporaneously with executing any amendment, waiver or modification of any document, covenant or term of this Agreement, any Definitive Document, or the Commitment Letter in accordance with Section 13 of this Agreement (an “Amendment”), the Company Parties shall publicly disclose such Amendment to the extent that it believes, in good faith, such Amendment constitutes material nonpublic information (collectively, “MNPI”).  In the event of a disagreement between the Company Parties and any Consenting Stakeholder regarding whether an Amendment constitutes MNPI, a Consenting Unsecured Noteholder or Consenting Term Loan Lender may publicly disclose such Amendment only if such Consenting Unsecured Noteholder or Consenting Term Loan Lender, as applicable, in good faith and upon the advice of counsel, believes that such Amendment constitutes MNPI.

 

IN WITNESS WHEREOF, the Parties have executed this Agreement on the day and year first above written.

 

[Signatures Follow]

 

41











 

Company Parties’ Signature Page to 
 the Transaction Support Agreement

 

	
NEIMAN MARCUS GROUP, INC.
    	
 
    
	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Senior Vice President,   General Counsel, Corporate
    	
 
    
	
Secretary and Chief   Compliance Officer
    	
 
    
	
 
    	
 
    
	
BERGDORF GOODMAN INC.
    	
 
    
	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    
	
BERGDORF GRAPHICS, INC.
    	
 
    
	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    
	
BG PRODUCTIONS, INC.
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    
	
MARIPOSA BORROWER, INC.
    	
 
    
	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
				


 











 

	
MARIPOSA INTERMEDIATE HOLDINGS   LLC
    	
 
    
	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    	
 
    
	
MARIPOSA LUXEMBOURG I S.A.R.L.
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Category A Manager
    	
 
    
	
 
    	
 
    	
 
    
	
MARIPOSA LUXEMBOURG II S.A.R.L.
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Category A Manager
    	
 
    
	
 
    	
 
    	
 
    
	
MYTHERESA.COM GMBH
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Managing Director
    	
 
    
	
 
    	
 
    	
 
    
	
MYTHERESA.COM SERVICE GMBH
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Managing Director
    	
 
    
	
 
    	
 
    	
 
    
	
NANCY HOLDINGS LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    


 











 

	
NEIMAN MARCUS BERMUDA L.P.
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    	
 
    
	
NEIMAN MARCUS GROUP LTD LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Senior Vice President,   General Counsel,
    	
 
    
	
Corporate   Secretary and Chief
    	
 
    
	
Compliance   Officer
    	
 
    
	
 
    	
 
    	
 
    
	
NEMA BEVERAGE CORPORATION
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
President
    	
 
    
	
 
    	
 
    	
 
    
	
NEMA BEVERAGE HOLDING   CORPORATION
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
President
    	
 
    
	
 
    	
 
    	
 
    
	
NEMA BEVERAGE PARENT   CORPORATION
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
President
    	
 
    


 











 

	
NM BERMUDA, LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    	
 
    
	
NM FINANCIAL   SERVICES, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    	
 
    
	
NM NEVADA TRUST
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    	
 
    
	
NMG ASIA LIMITED
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    	
 
    
	
NMG ASIA HOLDINGS LIMITED
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    


 












 

	
NMG CALIFORNIA SALON LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Senior Vice President   and General Counsel
    	
 
    
	
 
    	
 
    	
 
    
	
NMG GERMANY GMBH
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Managing Director
    	
 
    
	
 
    	
 
    	
 
    
	
NMG INTERNATIONAL LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President, General   Counsel and Secretary
    	
 
    
	
 
    	
 
    	
 
    
	
NMG FLORIDA SALON LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Senior Vice President   and General Counsel
    	
 
    
	
 
    	
 
    	
 
    
	
NMG GLOBAL MOBILITY, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President, General   Counsel and Secretary
    	
 
    
	
 
    	
 
    
	
NMG SALONS LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Senior Vice President   and General Counsel
    	
 
    


 











 

	
NMG SALON HOLDINGS LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Chief Executive Officer   and President
    	
 
    
	
 
    	
 
    	
 
    
	
NMG TEXAS SALON LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Senior Vice President   and General Counsel
    	
 
    
	
 
    	
 
    	
 
    
	
NMGP, LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    	
 
    
	
WORTH AVENUE LEASING COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Vice President and   Secretary
    	
 
    
	
 
    	
 
    	
 
    
	
THE NEIMAN MARCUS GROUP LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Senior Vice President,   General Counsel,
    	
 
    
	
Corporate   Secretary and Chief
    	
 
    
	
Compliance   Officer
    	
 
    


 











 

	
THERESA WARENVERTRIEB GMBH
    	
 
    
	
 
    	
 
    	
 
    
	
By: 
    	
/s/ Tracy M. Preston
    	
 
    
	
 
    	
 
    	
 
    
	
Name: 
    	
Tracy M. Preston
    	
 
    
	
Title: 
    	
Managing Director
    	
 
    


 











 

Consenting Stakeholder Signature Page to 
 the Transaction Support Agreement

 

	
[CONSENTING   STAKEHOLDER]
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Authorized   Signatory:
    	
 
    
	
Title:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Address:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
E-mail   address(es):
    	
 
    


 

	
Aggregate Amounts Beneficially Owned or Managed on Account of:
    
	
Term Loan Claims
    
	
Cash Pay Notes
    
	
PIK Toggle Notes
    
	
Shares of Existing Common Stock
    


 












 

EXECUTION VERSION

 

Exhibit A

 

NEIMAN MARCUS GROUP, INC., ET AL.

 

RECAPITALIZATION TERM SHEET(1)

 

March 25, 2019

 

THIS RECAPITALIZATION TERM SHEET AND THE DOCUMENTS ATTACHED HERETO COLLECTIVELY DESCRIBE A PROPOSED RECAPITALIZATION OF NEIMAN MARCUS GROUP, INC., A DELAWARE CORPORATION, AND CERTAIN OF ITS SUBSIDIARIES AS DEFINED IN THIS RECAPITALIZATION TERM SHEET.

 

THIS RECAPITALIZATION TERM SHEET IS NOT AN OFFER OR A SOLICITATION WITH RESPECT TO ANY SECURITIES OF THE COMPANY PARTIES.  ANY SUCH OFFER OR SOLICITATION SHALL COMPLY WITH ALL APPLICABLE SECURITIES LAWS.

 

THIS RECAPITALIZATION TERM SHEET IS A SETTLEMENT PROPOSAL TO CERTAIN UNAFFILIATED LENDERS UNDER THE COMPANY PARTIES’ TERM LOAN CREDIT AGREEMENT, CERTAIN UNAFFILIATED HOLDERS OF THE COMPANY PARTIES’ UNSECURED NOTES, AND CERTAIN HOLDERS OF THE COMPANY PARTIES’ EXISTING COMMON STOCK IN FURTHERANCE OF SETTLEMENT DISCUSSIONS.  ACCORDINGLY, THIS RECAPITALIZATION TERM SHEET IS PROTECTED BY RULE 408 OF THE FEDERAL RULES OF EVIDENCE AND ANY OTHER APPLICABLE STATUTES OR DOCTRINES PROTECTING THE USE OR DISCLOSURE OF CONFIDENTIAL SETTLEMENT DISCUSSIONS.

 

REFERENCE IN THIS RECAPITALIZATION TERM SHEET IS MADE TO THAT CERTAIN TRANSACTION SUPPORT AGREEMENT (THE “TRANSACTION SUPPORT AGREEMENT”) BY AND AMONG THE COMPANY PARTIES AND THE OTHER PARTIES THERETO, DATED AS OF THE DATE OF THIS RECAPITALIZATION TERM SHEET.

 

THIS RECAPITALIZATION TERM SHEET IS FOR DISCUSSION PURPOSES ONLY AND DOES NOT PURPORT TO SUMMARIZE ALL OF THE TERMS, CONDITIONS, REPRESENTATIONS, WARRANTIES, AND OTHER PROVISIONS WITH RESPECT TO THE TRANSACTIONS DESCRIBED IN THIS RECAPITALIZATION TERM SHEET, WHICH TRANSACTIONS WILL BE SUBJECT TO THE COMPLETION OF DEFINITIVE DOCUMENTS INCORPORATING THE TERMS AND CONDITIONS SET FORTH IN THIS RECAPITALIZATION TERM SHEET AND THE CLOSING OF ANY TRANSACTION SHALL BE SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN SUCH DEFINITIVE DOCUMENTS.

 




(1)         Capitalized terms used but not otherwise defined in this Recapitalization Term Sheet shall have the meaning ascribed to them in the Transaction Support Agreement or the other term sheets annexed hereto, as applicable.

 











 

	
Overview
    
	
 
    	
 
    	
 
    
	
Recapitalization Transaction Overview
    	
 
    	
This term sheet (including all exhibits, annexes,   appendices, and/or schedules hereto, the “Recapitalization   Term Sheet”) contemplates a consensual recapitalization of   certain of the Company Parties’ outstanding indebtedness and equity interests   (the “Recapitalization Transactions”)   consisting of the transactions described in this Recapitalization Term Sheet   on terms and conditions consistent with this Recapitalization Term Sheet and   the Transaction Support Agreement.

 

This Recapitalization Term Sheet does not include a   description of all of the terms, conditions, and other provisions that are to   be contained in the definitive documentation governing the Recapitalization   Transactions. The Recapitalization Transactions will not contain any material   terms or conditions that are inconsistent in any material respect with this   Recapitalization Term Sheet and the exhibits attached hereto.
    
	
 
    	
 
    	
 
    
	
Debt to Be Restructured
    	
 
    	
Outstanding indebtedness of the Company Parties that   will be restructured or satisfied pursuant to the Recapitalization   Transactions includes:

 

Term Loan Credit Facility

 

Approximately $2.8 billion in principal amount   outstanding (the “Term Loan Credit   Facility”) under that certain term loan credit agreement (as   amended from time to time, the “Term Loan Credit   Agreement”), dated as of October 25, 2013, by and among   Neiman Marcus Group LTD LLC, as borrower, certain of the Company Parties, as   guarantor(s), Credit Suisse AG, Cayman Islands Branch, as lender and agent   (the “Term Loan Agent”), and the   other lenders party thereto from time to time (collectively, with the Term   Loan Agent, the “Term Loan Lenders”).

 

The Unsecured Notes

 

Approximately $960 million in principal amount of   8.0% cash pay notes due 2021 (the “Cash Pay Notes,”   and the parties holding such Cash Pay Notes, collectively, the “Cash Pay Noteholders”)   outstanding under the Indenture, dated as of October 21, 2013, by and   among Neiman Marcus Group LTD LLC and Mariposa Borrower, Inc., as   issuers, certain of the Company Parties, as guarantor(s), and U.S. Bank   National Association, as the trustee (the “Cash   Pay Notes Trustee”).

 

Approximately $658 million in principal amount of   8.75%/9.50% PIK toggle notes due 2021 (the “PIK   Toggle Notes,” and the parties holding such PIK Toggle Notes,   the “PIK Toggle Noteholders”)   outstanding under the Indenture, dated as of October 21, 2013, by and   among Neiman Marcus Group LTD LLC and Mariposa Borrower, Inc. as   issuers, certain of the Company Parties, as guarantor(s), and U.S. Bank   National Association, as the trustee (the “PIK   Toggle Notes Trustee”).

 

As used in this Recapitalization Term Sheet, the   Cash Pay Notes and PIK Toggle Notes collectively are referred to as the “Unsecured Notes” and the Cash Pay   Noteholders and the PIK Toggle Noteholders collectively are referred to as   the “Unsecured Noteholders.”
    
	
 
    	
 
    	
 
    
	
New Securities to be Issued
    	
 
    	
On or before the Effective Date, the applicable   Company Parties will issue the following new securities.

 

New Second Lien Notes

 

On or before the Effective Date, certain Company   Parties will issue $550 million of new second lien secured notes (the “New Second Lien Notes”) on terms   and conditions consistent with this Recapitalization Term Sheet and the term   sheet attached hereto as Exhibit 1   (the “New Second Lien Notes Term Sheet”).
    


 

2











 

	
 
    	
 
    	
The Sponsors and the Ad Hoc Committee of Unsecured   Noteholders have agreed to collectively backstop $550 million of New Second   Lien Notes on the terms and conditions set forth in the fully executed   commitment letter attached hereto as Exhibit 2   (the “Commitment Letter”).

 

New Third Lien Notes

 

On the Effective Date, pursuant to the Exchange   Offer (as defined below), certain Company Parties will issue new third lien   secured notes (the “New Third Lien Notes”)   in the amount set forth in and on terms and conditions consistent with this   Recapitalization Term Sheet and the term sheet attached hereto as Exhibit 3 (the “New Third Lien Notes Term Sheet”).

 

MT Preferred Equity

 

On the Effective Date, certain newly formed Delaware   entities that hold the operations that conduct the business of MyTheresa and   that become Company Parties will issue $500 million of new preferred stock   (the “MT Preferred Equity”) on   terms and conditions consistent with this Recapitalization Term Sheet and the   term sheet attached hereto as Exhibit 4   (the “MyTheresa Issuer Preferred Equity Term   Sheet”).
    
	
 
    
	
Material Provisions
    
	
 
    	
 
    	
 
    
	
Amendment of Term Loan Credit Facility and   Paydown of Term Loans
    	
 
    	
The Term Loan Credit Agreement will be amended and   the Consenting Term Loan Lenders and all other Term Loan Lenders consenting   to such amendment will amend or exchange their Term Loans into extended term   loans (the “Extended Term Loans”; and   such amendment and extension transactions, the “Amendment   and Extension”) in a manner consistent with this Recapitalization   Term Sheet and the terms and conditions set forth in the term sheet attached   hereto as Exhibit 5 (the “Amended Term Loan Term Sheet” and   the Term Loan Credit Agreement, as amended, the “Amended   Term Loan Credit Agreement”).

 

On the Effective Date, immediately following the   Amendment and Extension, $550 million aggregate principal amount of the   Extended Term Loans will be prepaid, on a pro rata basis, in cash at par,   funded by the net cash proceeds from the issuance of the New Second Lien Notes,   cash on hand, and other liquidity sources, subject to any waivers or   adjustments with respect to such prepayment set forth in the Amended Term   Loan Term Sheet.
    
	
 
    	
 
    	
 
    
	
Exchange of Unsecured Notes
    	
 
    	
On or after the Agreement Effective Date, the   Company Parties will launch an exchange offer for the existing Unsecured   Notes (the “Exchange Offer”).

 

Upon consummation of the Exchange Offer on the   Effective Date, each Unsecured Noteholder who has tendered its Unsecured   Notes into the Exchange Offer will exchange a portion of its tendered   Unsecured Notes, at par, into its Pro Rata Share (as defined below) of $250   million of MT Preferred Equity, with the balance of its tendered Unsecured   Notes exchanged at par into New Third Lien Notes. Any accrued and unpaid   interest on the tendered Unsecured Notes shall be paid in cash at the closing   of the Exchange Offer.

 

“Pro Rata Share”   means the fraction, (x) the numerator of which is the aggregate   principal amount of Unsecured Notes tendered in the Exchange Offer by such   Unsecured Noteholder and (y) the denominator of which is the aggregate   principal amount of Unsecured Notes tendered by all Unsecured Noteholders in   the Exchange Offer.

 

A consent payment of 100 bps (calculated based on   the aggregate principal amount of Unsecured Notes tendered into the Exchange   Offer by the parties entitled to such payment) will be earned by Consenting   Unsecured Noteholders who execute (or 
    


 

3











 

	
 
    	
 
    	
execute a joinder to) the Transaction Support   Agreement by 5 p.m. Eastern Time on the sixth Business Day after the   announcement of the Agreement Effective Date, earned upon execution of the   Transaction Support Agreement (or joinder) and payable in cash upon, and   subject to the occurrence of the Effective Date (the “Noteholder Cash Joinder Payment”).

 

For U.S. federal (and applicable state and local)   income tax purposes, the Company Parties shall not take any tax position   inconsistent with the treatment of the Noteholder Cash Joinder Payment as a   payment of interest or principal on the Unsecured Notes.
    
	
 
    	
 
    	
 
    
	
MyTheresa Intercompany Debt/Equity Rearrangement
    	
 
    	
In connection with forming MT Issuer and MT Holdco   and as part of the Recapitalization Transactions, NMG shall cause all   existing intercompany debt, preferred equity (including CPECs), common   equity, and any other similar intercompany arrangements issued by or entered   into by MT Issuer as the obligor, issuer or payer (collectively, “MyTheresa Intercompany Debt/Equity”)   to be contributed, assigned or otherwise amended so that (i) the holder   of any such Intercompany Debt/Equity is either MT Issuer or a direct or   indirect wholly owned subsidiary of MT Issuer (other than the MT Operating   Entities), and (ii) no subsidiary of MT Issuer, as a result of such   contribution, assignment or other amendment, has any obligation to make any   material payment to NMG, or to any subsidiary of NMG other than MT Issuer or   a direct or indirect subsidiary of MT Issuer (such contributions,   assignments, or amendments in respect of MyTheresa Intercompany Debt/Equity,   the “MyTheresa Intercompany Debt/Equity Rearrangement”).   For the avoidance of doubt, the MyTheresa Intercompany Debt/Equity   Rearrangement shall not affect the obligations of the MT Operating Entities.
    
	
 
    	
 
    	
 
    
	
Release Ratification
    	
 
    	
The Term Loan Credit Agreement, Cash Pay Notes   Indenture and PIK Toggle Notes Indenture will each be amended, amended and   restated, supplemented or otherwise modified to, and the indentures governing   the New Second Lien Notes and New Third Lien Notes will, provide for the   ratification, acknowledgement and agreement to the Recapitalization   Transactions and the releases, covenants not to sue and other provisions   described in Section 9 of the Transaction Support Agreement.  The   collective action and/or no-action provisions in the Term Loan Credit   Agreement, Cash Pay Notes Indenture and PIK Toggle Notes Indenture will each   be clarified, amended, amended and restated, supplemented or otherwise   modified to, and the indentures governing the New Second Lien Notes and New   Third Lien Notes will include collective action and/or no-action provisions   that, absent compliance with the pre-requisites for lender action under those   provisions, preclude any lender action with respect to any rights or remedies   with respect to the Transaction Support Agreement (including any Released   Claims (as defined in the Transaction Support Agreement)) and the   Recapitalization Transactions, in addition to customary rights, remedies, and   no-action clauses with respect to the applicable documents and the   securities, notes, or loans issued thereunder.

 

All of the foregoing provisions shall be binding   upon the borrowers, guarantors, lenders, holders, agents and trustees under   such documents and upon the successors and assigns of such lenders, holders,   agents or trustees.
    
	
 
    	
 
    	
 
    
	
Collateral and Ranking of Priority of Security   Interests
    	
 
    	
On the Effective Date and after giving effect to the   Recapitalization Transactions, the collateral and ranking of priorities of   securities interests on certain assets in favor of lenders, holders or other   stakeholders of the Company Parties with respect to the debt and securities   of the applicable Company Parties shall be as set forth on Exhibit 6 attached hereto.   Notwithstanding anything to the contrary in this Recapitalization Term Sheet,   the 7.125% Senior Debentures due 2028 issued pursuant to the Indenture, dated   as of May 27, 1998 (the “2028 Debentures   Indenture”) shall be secured by “equal and ratable” liens on   property subject to the liens of the holders of Extended 
    


 

4











 

	
 
    	
 
    	
Term Loans under the Amended Term Loan Credit   Agreement to the extent required under the 2028 Debentures Indenture.
    
	
 
    	
 
    	
 
    
	
Conditions Precedent to the Effective Date
    	
 
    	
The following shall be conditions precedent to the   Effective Date:

 

1.   institutions holding, in the aggregate, at   least 95% of the principal amount outstanding of the Term Loans and at least   95% of the aggregate outstanding principal amount of Unsecured Notes,   respectively, shall have executed and delivered consents to participate in   the Recapitalization Transactions; provided that   the foregoing thresholds may be reduced by the Company Parties in their sole   discretion;

 

2.   the Company Parties shall have issued all   securities, notes, instruments, certificates, and other documents required to   be issued pursuant to the Recapitalization Transactions in a manner   consistent with this Recapitalization Term Sheet and the Definitive   Documents;

 

3.   the Company Parties shall have obtained all   authorizations, consents, regulatory approvals, rulings, or documents that   are necessary to implement and effectuate the Recapitalization Transactions;

 

4.   the Recapitalization Transactions shall   have been consummated in a manner consistent with the Transaction Support   Agreement;

 

5.   the Transaction Support Agreement shall not   have been validly terminated prior to the Effective Date by any of   (i) the Company Parties, (ii) the Sponsors, (iii) Unsecured   Noteholders constituting the Required Consenting Unsecured Noteholders, or   (iv) Term Loan Lenders constituting the Required Consenting Term Loan   Lenders;

 

6.   the Revolving Credit Agreement (or any   replacement thereof) shall not prohibit the Recapitalization Transactions;

 

7.   no Material Adverse Event shall have   occurred since the Agreement Effective Date;

 

8.   the MyTheresa Intercompany Debt/Equity   Rearrangement shall have occurred;

 

9.   the Company Parties (other than the MT   Operating Entities) shall have paid in full to the relevant Parties the   Commitment Payment, the Noteholder Cash Joinder Payment, the Term Loan Lender   Consent Fee, the Term Loan Lender Cash Joinder Fee and any and all other   payments and fees provided for in the Transaction Support Agreement, this   Recapitalization Term Sheet and applicable Definitive Documents that are   payable on, before, or in connection with the occurrence of the Effective   Date; and

 

10. the Company Parties (other than the MT   Operating Entities) shall pay or reimburse, after presentation of an invoice   therefor, the Creditor Fees and Expenses.
    
	
 
    	
 
    	
 
    
	
Recapitalization Transactions & Tax   Issues
    	
 
    	
The Parties shall consult in good faith and   reasonably cooperate in order to implement the Recapitalization Transactions   in a tax efficient manner.
    


 

[Exhibits to follow.]

 

5












 

EXECUTION VERSION

 

EXHIBIT 1

 

New Second Lien Notes Term Sheet

 

The following summarizes the principal terms of the New Second Lien Notes.(1)

 

	
Principal Amount
    	
 
    	
$550 million.
    
	
 
    	
 
    	
 
    
	
Issuers
    	
 
    	
If an offering of the New Second Lien Notes (an “Escrowed   Offering”) is consummated prior to the closing of the exchange offer   related to the New Third Lien Notes (the “Exchange Offer Consummation Date”),   the New Second Lien Notes in such Escrowed Offering will initially be issued   only by an escrow issuer (the “Escrow Issuer”), which shall be an   “Unrestricted Subsidiary” under the applicable debt instruments.

 

From and after the Exchange Offer Consummation Date   (subject, in the case of New Second Lien Notes issued in an Escrowed   Offering, to satisfaction of customary conditions (the “Escrow Conditions”)   for the release of funds from the Escrow Account (as defined below)), the New   Second Lien Notes will be the obligations of Neiman Marcus Group LTD LLC, a   Delaware limited liability company (the “LLC Co-Issuer”), The Neiman   Marcus Group LLC, a Delaware limited liability company (the “New Co-Issuer”),   a direct wholly-owned subsidiary of the New Co-Issuer (which shall be the   same subsidiary of the New Co-Issuer that is a Co-Borrower (as defined in Exhibit 5) under the Amended Term Loan Credit   Agreement (as defined in Exhibit 5))   (the “New Co-Issuer Subsidiary”) and Mariposa Borrower, Inc., a   Delaware corporation (the “Corporate Co-Issuer” and, together with the   LLC Co-Issuer, the New Co-Issuer and the New Co-Issuer Subsidiary, the “Issuers”).
    
	
 
    	
 
    	
 
    
	
Guarantors
    	
 
    	
With respect to New Second Lien Notes issued in the   Escrowed Offering, the New Second Lien Notes will not be guaranteed on the   issue date.

 

From and after the Exchange Offer Consummation Date,   the New Second Lien Notes will be jointly and severally guaranteed with the   priorities and as further described in “Security/Ranking” below by (i) all current and future Domestic   Subsidiaries, (ii) all future Foreign Subsidiaries, subject to certain   exceptions based on foreign law requirements and any adverse change in   applicable tax law, (iii) PropCo (as defined below), if applicable,   (iv) New Subsidiary (as defined in Exhibit 5),   if applicable and (v) MT Holdco (as defined in Exhibit 4),   MT Issuer (as defined in Exhibit 4),   MT Intermediate Holdco (as defined in Exhibit 4),   Mariposa Luxembourg I S.à r.l. and Mariposa Luxembourg II S.à r.l.,   (collectively, and together with their respective successors, the “MT Guarantor   Entities”) (provided, that, the guarantee provided by the MT Guarantor   Entities described in this clause (v) shall be limited to an aggregate   amount not to exceed $200 million under any circumstances) (collectively, the   entities described in clauses (i)-(v), the 
    


 




(1)                                 Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to such terms in the Transaction Support Agreement, dated as of March 25, 2019 (including the Recapitalization Term Sheet and the exhibits thereto) (the “Agreement”).

 











 

	
 
    	
 
    	
“Guarantors”; the Guarantors, together with   the Issuers, shall be referred to as the “Note Parties”), subject to   exceptions to be agreed.

 

Notwithstanding the foregoing, (i) no direct or   indirect Subsidiary or equity investee of Mariposa Intermediate may directly   or indirectly provide credit support for the New Second Lien Notes, and   (ii) no direct or indirect Subsidiary or equity investee of Mariposa   Intermediate may be an obligor on any indebtedness for borrowed money for   which any Note Party directly or indirectly provides credit support, unless,   in each case of clause (i) and (ii), such Subsidiary or equity investee   becomes a guarantor of the Extended Term Loans; provided that the foregoing   shall not apply to the provision of credit support for the New Second Lien   Notes as contemplated by this Exhibit 1   by the MT Guarantor Entities and their subsidiaries.

 

Notwithstanding the foregoing, (i) no direct or   indirect Subsidiary or equity investee of Mariposa Intermediate may directly   or indirectly provide credit support for the Extended Term Loans (as defined   in Exhibit 5), and (ii) no direct or indirect Subsidiary or equity   investee of Mariposa Intermediate may be an obligor on any indebtedness for   borrowed money for which any guarantor or obligor on the Extended Term Loans   directly or indirectly provides credit support, unless, in each case of   clause (i) and (ii), such Subsidiary or equity investee becomes a Note   Party.

 

Subject to the “call right” described in Exhibit 5 (the “Call Right”), the guarantees   of PropCo and New Subsidiary, if any, shall be unsecured and subject to the   following priorities as to contractual right of payment:
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
Guarantee of
   Extended Term
   Loan
    	
 
    	
Guarantee of New
   Second Lien Notes
    	
 
    	
Guarantee of New
   Third Lien Notes
    	
 
    
	
 
    	
 
    	
PropCo 
    	
 
    	
Third
    	
 
    	
Second
    	
 
    	
First
    	
 
    
	
 
    	
 
    	
New Subsidiary 
    	
 
    	
First
    	
 
    	
Second
    	
 
    	
Third
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
“Foreign Subsidiary” means a Restricted   Subsidiary not organized or existing under the laws of the United States of America,   any state thereof or the District of Columbia.

 

“Domestic Subsidiary” means any Restricted   Subsidiary that is not a Foreign Subsidiary.
    
	
 
    	
 
    	
 
    
	
Security/Ranking
    	
 
    	
Prior to the release of the proceeds of the New   Second Lien Notes from the Escrow Account, the New Second Lien Notes issued   in the Escrowed Offering will be secured by a valid first-priority security   interest in the Escrow Account and all funds held therein.

 

From and after the Exchange Offer Consummation Date,   the New Second Lien Notes, related guarantees and other obligations under the   Definitive Documents related thereto (the “New Second Lien Obligations”)   shall be subject to the following credit support:

 

·                  to the extent the assets listed on Annex A hereto (the “PropCo   Assets”) are able to be pledged or mortgaged to secure the New Second   Lien Obligations, the New Second Lien Obligations shall be secured by a   second-priority lien on those PropCo Assets, subject to the Call Right;

·                  to the extent the PropCo Assets are   not able to be pledged or mortgaged to secure the New Second Lien   Obligations, such PropCo Assets shall
    


 











 

	
 
    	
 
    	
be held by a special   purpose vehicle formed to hold the PropCo Assets (such entity which will be a   subsidiary of the New Co-Issuer, “PropCo”), and the New Second Lien   Obligations shall be secured by a second-priority pledge of the equity of   PropCo, subject to the Call Right;

·                  the New Second Lien Obligations   will be secured on a second-priority basis by the Extended Term Loan   Collateral (as defined in Exhibit 5)   (including leaseholds and other real property interests constituting Extended   Term Loan Collateral that cannot be pledged, through a second-priority pledge   of the equity interests of New Subsidiary);

·                  the New Second Lien Obligations   will be secured on a third-priority basis by the ABL Priority Collateral (as   defined in Exhibit 5);

·                  unless MT Alternate Security is   provided pursuant to the terms hereof, the New Second Lien Obligations will   be secured on a first-priority basis by the MT Account; and

·                  unless MT Alternate Security is   provided,until a MT Deposit Event occurs, the New Second Lien Obligations   will be secured on a first-priority basis by substantially all of the assets   of the MT Guarantor Entities;

 

in each case subject to exceptions to be agreed   reasonably acceptable to the Required Consenting Unsecured Noteholders   (collectively, the “Collateral”). The obligations of the New Second   Lien Notes shall be marshaled against (i) first, the MT Account,   (ii) second, the PropCo Assets and any equity interests of PropCo, the   Extended Term Loan Collateral and the ABL Priority Collateral and   (iii) third, the other assets of the MT Guarantor Entities.

 

At the Exchange Offer Consummation Date, all equity   interests of any of the MT Guarantor Entities and all intercompany loans or   receivables owed by any of the MT Guarantor Entities held by Neiman Marcus   Group, Inc. or any of its subsidiaries (other than the MT Guarantor   Entities and their subsidiaries) shall be contributed (through MT Holdco) to MT   Issuer.

 

MT Secondary Sales:(2)

 

Unless MT Alternate Security has been provided, the   first $200 million of net cash proceeds (which amount shall be reduced by the   amount of Qualified LCs that have been issued) from any MT Secondary Sales   shall be irrevocably deposited in the MT Account (and, as a condition to the   consummation of any MT Secondary Sale, the applicable   equityholder(s) shall cause the purchaser(s) to fund such proceeds   directly to MT Issuer for deposit in the MT Account). Any net cash proceeds   from a MT Secondary Sale shall otherwise be applied as provided in Exhibit 4.

 

Unless MT Alternate Security has been provided or a   MT Deposit Event has occurred, no sale, disposition, monetization or other   transfer (whether directly, indirectly or synthetically, including through   derivative transactions or by means of a transaction involving MT Holdco or   any other entity that directly or indirectly owns equity interests in the MT   Issuer) of equity interests of the MT
    


 




(2)                                 Note:  Substantially the same definitions will be used in the New Third Lien Notes Indenture and the Preferred Stock Certificate of Designations provisions.

 











 

	
 
    	
 
    	
Issuer by Neiman Marcus Group, Inc. or its   subsidiaries shall be made for any consideration other than cash or cash   equivalents.

 

For purposes of the foregoing:

 

“MT Secondary Sale” means (i) the sale,   disposition, monetization or other transfer (whether directly, indirectly or   synthetically, including through derivative transactions or by means of a   transaction involving MT Holdco or any other entity that directly or   indirectly owns equity interests in the MT Issuer) of equity interests of the   MT Issuer by Neiman Marcus Group, Inc. or its subsidiaries to any   Independent Third Party, other than a primary sale of equity interests for cash   whose net cash proceeds are contributed to or retained by the MT Group (as   defined in Exhibit 4) or (ii) any   MT Asset Sale other than a Qualified MT Asset Sale.

 

“MT Asset Sale” means any direct or indirect   sale, disposition, monetization or other transfer of any assets or property   of the MT Group (whether directly or indirectly or synthetically, including   through derivative transactions), subject to customary exceptions to be   agreed (including a $5.0 million de minimis basket for one or a series of   related transactions and an exception for ordinary course sales or   liquidations of inventory) based on the “Limitations on Asset Sales” covenant   to be contained in the New Second Lien Notes Indenture, to an Independent   Third Party.

 

“Qualified MT Asset Sale” means any MT Asset   Sale made for fair market value and for not less than 75% cash, the net cash   proceeds of which are reinvested by the MT Group in non-current assets (or an   operating business that is similar to the business of the MT Group) held by   the MT Group within 180 days after receipt thereof; provided that   (i) any MT Asset Sale or series of related MT Asset Sales for more than   $100.0 million in consideration may not be deemed to be a Qualified MT Asset   Sale, and (ii) non-current assets (or an operating business that is   similar to the business of the MT Group) received by the MT Group from an   Independent Third Party as consideration for a MT Asset Sale shall be deemed   to be cash for purposes of the foregoing definition.

 

“Independent Third Party” means a person or   entity other than (i) any member of the Company Group or any of the   Sponsors, (ii) an affiliate of any member of the Company Group or any of   the Sponsors or (iii) another person or entity in which the Company   Group and/or any of the Sponsors and/or their respective affiliates own an   equity interest.

 

“MT Account” means a segregated account of MT   Holdco for the benefit of the Trustee on behalf of the holders of the New   Second Lien Notes, pledged to secure the New Second Lien Notes as provided   above. Upon the maturity of the New Second Lien Notes or their earlier   retirement, replacement or redemption in full, the proceeds held in the MT   Account shall be released to the MT Guarantor Entities or their assignees for   application in accordance with the provisions of Exhibit 4.

 

“MT Alternate Security” means any security   that is acceptable in the sole discretion of holders of at least 66-2/3% of   the outstanding New Second Lien Notes.

 

“Qualified LCs” means one or more letters of credit   issued by a reputable bank or trust company that is organized under the laws   of the United States of America or any state thereof or any foreign country   recognized by the United 
    


 











 

	
 
    	
 
    	
States of America having capital, surplus and undivided profits   in excess of $250,000,000 and whose long-term debt, or whose parent holding   company’s long-term debt, is rated A (or such similar equivalent rating or   higher by at least one nationally recognized statistical rating organization   (as defined in Rule 436 under the Securities Act)) supporting the   guarantee of New Second Lien Notes by the MT Guarantor Entities, in an   aggregate amount equal to the difference between (x) $200.0 million and   (y) the amount of net cash proceeds of MT Secondary Sales that has been   irrevocably deposited in the MT Account.

 

“MT Deposit Event” means (i) the   irrevocable deposit of net cash proceeds of MT Secondary Sales in the MT   Account in an aggregate amount that is not less than (x) $200.0 million   less (y) the aggregate amount of Qualified LCs that have been provided   and (ii) the provision of such Qualified LCs.

 

The indebtedness evidenced by the New Second Lien   Notes and the guarantees of the New Second Lien Notes will be effectively   senior to all of the Issuers’ and the Guarantors’ future unsecured and junior   secured indebtedness, to the extent of the value of the applicable   Collateral, and structurally junior to all liabilities of any of the Issuers’   subsidiaries that are not Guarantors.
    
	
 
    	
 
    	
 
    
	
Maturity
    	
 
    	
The New Second Lien Notes will mature on   April 25, 2024.
    
	
 
    	
 
    	
 
    
	
Interest
    	
 
    	
Interest on the New Second Lien Notes will accrue   from the Effective Date at a rate of (i) 8% per annum,   payable semi-annually in cash in arrears, plus
   (ii) 6% per annum, payable   semi-annually in kind in arrears.
    
	
 
    	
 
    	
 
    
	
Issue Price
    	
 
    	
97%.
    
	
 
    	
 
    	
 
    
	
Optional Redemption
    	
 
    	
On or after the second anniversary of the Effective   Date, the Issuers may redeem the New Second Lien Notes at their option, in   whole at any time or in part from time to time, upon not less than 30 nor   more than 60 days’ prior notice provided to each holder’s registered address   or in accordance with the applicable procedures of DTC, at the following   redemption prices (expressed as a percentage of principal amount), plus accrued and unpaid interest to the redemption date   (subject to the right of holders of record on the relevant record date to   receive interest due on the relevant interest payment date), if redeemed   during the 12-month period commencing on the anniversaries of the Effective   Date set forth below:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Anniversary
    	
 
    	
Redemption Price
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Second
    	
 
    	
107.000
    	
%
    	
 
    
	
 
    	
 
    	
Third and thereafter
    	
 
    	
100.000
    	
%
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
At any time prior to the second anniversary of the   Effective Date, the Issuers may redeem the New Second Lien Notes in whole at   any time or in part from time to time at 100% of the aggregate principal   amount thereof, plus a “make-whole” premium of (a) interest payments   that would have been payable from the redemption date to such date and   (b) a treasury rate plus 0.50%.
    
	
 
    	
 
    	
 
    
	
Special Mandatory Redemption
    	
 
    	
If New Second Lien Notes are issued prior to the Exchange Offer   Consummation Date in an Escrowed Offering, the gross proceeds of the offering   will be deposited into a segregated escrow account (the “Escrow Account”).   If the Escrow Conditions are satisfied on or prior to June 10, 2019 (as   such date may be extended in accordance with the terms and 
    


 











 

	
 
    	
 
    	
conditions of the Agreement, the “Outside Date”), the   funds held in the Escrow Account will be released to the Issuers to fund the   use of proceeds of the New Second Lien Notes as set forth under “Use of Proceeds.” If the Escrow Conditions are not   satisfied and the Exchange Offer Consummation Date does not occur on or prior   to the Outside Date, the funds held in the Escrow Account will be released to   the Escrow Issuer or its successor to redeem the New Second Lien Notes issued   in an Escrowed Offering at a price of 100% of the initial issue price of the   New Second Lien Notes, plus accrued interest to, but not including, the   applicable redemption date.

 

In addition, the Escrow Issuer may redeem the New Second Lien   Notes issued in an Escrowed Offering, at its option, in whole but not in   part, at any time prior to the Outside Date at a redemption price equal to   100% of the initial issue price of the New Second Lien Notes plus accrued and   unpaid interest to, but not including, the redemption date if, in the LLC   Co-Issuer’s judgment, the Escrow Conditions will not be satisfied on or prior   to the Outside Date.
    
	
 
    	
 
    	
 
    
	
Backstop
    	
 
    	
The Sponsors and the Ad Hoc Committee of Unsecured Noteholders   will backstop $100 million and $450 million, respectively, of the New Second   Lien Notes on the terms set forth in the Commitment Letter. The Commitment   Letter shall not require the Ad Hoc Committee of Unsecured Noteholders   signatories to such Commitment Letter to purchase the New Second Lien Notes   prior to the Exchange Offer Consummation Date; provided that, no later than   the third business day prior to such purchase date, each such signatory shall   confirm in writing the availability of funds to cover such signatory’s pro   rata portion of the principal amount of New Second Lien Notes.
    
	
 
    	
 
    	
 
    
	
Documentation
    	
 
    	
The documentation and covenants shall be reasonably   acceptable to the Issuers and the Required Consenting Unsecured Noteholders.

 

The New Second Lien Notes will be subject to   (i) the Intercreditor Agreements (as defined in Exhibit 5)   and (ii) a security agreement and collateral documents with terms   substantially consistent with those governing the Amended Term Loan Credit   Agreement with such modifications as appropriate for notes and lien priority,   which documents, in each case of (i) and (ii) shall be reasonably   acceptable to the Required Consenting Unsecured Noteholders.
    
	
 
    	
 
    	
 
    
	
Conditions Precedent
    	
 
    	
The closing of the purchase and sale of the New Second   Lien Notes will be subject to appropriate and customary conditions for   facilities and transactions of this type including, without limitation, those   set forth with respect to the New Second Lien Notes in the Commitment Letter.
    
	
 
    	
 
    	
 
    
	
Covenants
    	
 
    	
Negative and affirmative covenants substantially similar to the   covenants under the Indentures, subject to (x) the modifications set   forth in Annex B of this new Second   Lien Notes Term Sheet, and (y) other modifications to be consistent with   the Amended Term Loan Credit Agreement and as appropriate for notes and lien   priority and customary exceptions and qualifications, in each case, in form   and substance reasonably acceptable to the Issuers and the Required   Consenting Unsecured Noteholders.
    
	
 
    	
 
    	
 
    
	
MT Guarantor Entities Covenants
    	
 
    	
Until the earlier to occur of (i) a MT Deposit   Event and (ii) the provision of MT Alternate Security, the New Second   Lien Notes Indenture shall require the MT Guarantor Entities to comply with   and to cause their subsidiaries to comply with the covenants set forth in the   MyTheresa Issuer Preferred Equity Term Sheet, and holders of the New Second   Lien Notes will be provided information with respect to the MT Entities as   set forth in Annex B.
    


 











 

	
 
    	
 
    	
On or before September 30, 2019 MT Holdco shall   be permitted to reorganize the ownership structure of MT Issuer and its   subsidiaries to eliminate Mariposa Luxembourg I S.à r.l. and Mariposa   Luxembourg II S.à r.l. provided that all equity pledges and guarantees by the   MT Guarantor Entities shall remain or be assumed by operation of law or   otherwise in connection with such restructuring and without the creation of   any additional tax liabilities at the time of the restructuring to the   holders of the Series A Preferred Stock (as defined in Exhibit 4) or to the holders of New Second Lien Notes   and New Third Lien Notes.

 

The foregoing covenants will be contained in the   form of guarantee of the MT Guarantor Entities.
    
	
 
    	
 
    	
 
    
	
Use of Proceeds
    	
 
    	
The net proceeds from   the issuance of the New Second Lien Notes will be used to pay down the Term   Loans in accordance with “Paydown” in Exhibit 5.
    
	
 
    	
 
    	
 
    
	
Registration Rights
    	
 
    	
The New Second Lien   Notes have not been and will not be registered under the Securities Act or   any state or other securities laws and may not be offered or sold except   pursuant to an exemption from, or in a transaction not subject to, the   registration requirements of the Securities Act.
    
	
 
    	
 
    	
 
    
	
Transfer
    	
 
    	
The New Second Lien   Notes will be freely transferable, subject to restrictions (i) pursuant   to federal and state securities laws (including that such New Second Lien   Notes shall only be transferable to “qualified institutional buyers” within   the meaning of Rule 144A promulgated under the Securities Act), and (ii) designed   to prevent the occurrence of circumstances that would reasonably be expected   to require registration or qualification of such New Second Lien Notes   pursuant to federal or state securities laws, or require the Issuers to file   reports pursuant to any applicable federal or state securities laws.
    
	
 
    	
 
    	
 
    
	
Public Market
    	
 
    	
None.
    
	
 
    	
 
    	
 
    
	
Book-Entry Form
    	
 
    	
The New Second Lien   Notes will be represented by one or more global notes in definitive, fully   registered form deposited with a custodian for, and registered in the name   of, a nominee of DTC.
    
	
 
    	
 
    	
 
    
	
Events of Default
    	
 
    	
Substantially similar to the   defaults as provided under the Indentures, subject to modifications   consistent with the defaults under the Amended Term Loan Credit Agreement and   for customary provisions related to security.

 

Notwithstanding anything to the   contrary contained herein or in the Agreement or otherwise, all existing   Defaults or Events of Default (if any) under the Unsecured Notes shall be   permanently waived under the Indentures on the Effective Date, effective as   of the first date any such Default or Event of Default exists or existed.
    
	
 
    	
 
    	
 
    
	
Representations and Warranties
    	
 
    	
Customary for the issuance of   secured notes including, but not limited to, those representations and   warranties in the Commitment Letter and Transaction Support Agreement and as   provided to the Term Lenders.
    
	
 
    	
 
    	
 
    
	
Trustee
    	
 
    	
To be appointed by the   Required Consenting Unsecured Noteholders and reasonably acceptable to the   Company.
    


 











 

	
Collateral Agent
    	
 
    	
To be appointed by the Required Consenting Unsecured   Noteholders and reasonably acceptable to the Company.
    
	
 
    	
 
    	
 
    
	
Ratings
    	
 
    	
The Issuers shall use their commercially reasonable   efforts to cause, within 60 days after the fiscal quarter in which the   New Second Lien Notes are issued, the New Second Lien Notes to receive a   rating from Standard & Poor’s, a division of The McGraw-Hill   Companies, Inc., or Moody’s Investors Service, Inc., or, if during   such time neither of such institutions shall be rating such obligations, an   equivalent rating from another nationally recognized statistical rating   agency.
    
	
 
    	
 
    	
 
    
	
Governing Law and Forum
    	
 
    	
New York.
    


 












 

ANNEX A

 

PropCo Assets

 

	
#
    	
 
    	
Locations
    	
 
    	
Address
    	
 
    	
Store Number
    
	
Owned Locations
    
	
1.
    	
 
    	
Tysons Galleria, VA
    	
 
    	
2255 International   Drive
   McLean, Virginia 22102
    	
 
    	
1023
    
	
Leased Locations
    
	
2.
    	
 
    	
Topanga Plaza, CA
    	
 
    	
6550 Topanga Canyon Boulevard
    Canoga Park, California 91303
    	
 
    	
1105
    
	
3.
    	
 
    	
Walnut Creek, CA
    	
 
    	
1000 South Main Street
    Walnut Creek, California 94596
    	
 
    	
1110
    
	
4.
    	
 
    	
Fort Lauderdale, FL
    	
 
    	
2442 East Sunrise Boulevard
    Fort Lauderdale, Florida 33304
    	
 
    	
1018
    
	
5.
    	
 
    	
Troy, MI
    	
 
    	
2705 W. Big Beaver Road
    Troy, Michigan 48084
    	
 
    	
1033
    
	
6.
    	
 
    	
Coral Gables, FL
    	
 
    	
390 San Lorenzo Avenue
    Coral Gables, Florida 33146
    	
 
    	
1034
    
	
7.
    	
 
    	
Charlotte, NC
    	
 
    	
4400 Sharon Road
    Charlotte, North Carolina 28211
    	
 
    	
1102
    
	
8.
    	
 
    	
Austin, TX
    	
 
    	
3400 Palm Way
    Austin, Texas 78758
    	
 
    	
1101
    


 












 

EXECUTION VERSION

 

ANNEX B

 

Neiman Marcus

New Second Lien Notes

Changes from Terms of Existing Senior Unsecured Notes

(amounts in millions unless otherwise specified)

(all terms are after the escrow break)

 

Reference is hereby made to the 8.750%/9.500% Senior PIK Toggle Notes Indenture, dated as of October 21, 2013 and the 8.000% Senior Cash Pay Notes Indenture, dated as of October 21, 2013, among Mariposa Merger Sub LLC and Borrower, Inc. as issuers, and U.S. Bank National Association, as trustee (together, the “Indentures”).  Reference is also made to the Term Loan Credit Agreement, dated as of October 25, 2013, among Mariposa Intermediate Holdings LLC (“Holdings”), Neiman Marcus Group LTD LLC (the “Company”) (as successor by merger to Mariposa Merger Sub LLC), the subsidiaries of the Company from time to time party thereto, Credit Suisse AG, Cayman Islands Branch, Administrative and Collateral Agent, and the lenders thereunder (the “Credit Agreement”).

 

All capitalized terms used herein and not otherwise defined, unless otherwise indicated, shall have the meaning ascribed to such terms in the New Second Lien Notes Term Sheet or the Transaction Support Agreement (including all exhibits, annexes, and schedules thereto), as applicable. To the extent there is a conflict between this Exhibit A, on the one hand, and the New Second Lien Notes Term Sheet, on the other hand, the terms and provisions of the body of the New Second Lien Notes Term Sheet shall be controlling.

 


	
General
    	
 
    	
Existing Senior Unsecured Notes
    	
 
    	
New Second Lien Notes
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
1.        Voting
    	
 
    	
Disregards   Notes owned by the Issuers, any Subsidiary of either of the Issuers or any   Affiliate of either of the Issuers.
    	
 
    	
Same.   In addition any Additional New Second Lien Notes will be disregarded for   purposes of any amendment or waiver relating to a Default or Event of Default   that existed (disregarding any applicable notice, cure or grace periods)   prior to the time of issuance of such Additional New Second Lien Notes.

 

No   Co-Obligor or Co-Issuer may be added to the New Second Lien Notes on a   go-forward basis without the consent of a majority in principal amount of the   Notes then outstanding.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
2.        Merger and Guarantor Release
    	
 
    	
Limitations   on Issuer Mergers (§4.1) and Guarantor Mergers (§4.1) and Releases (§10.2).
    	
 
    	
Tightening   of limitations on Issuer mergers and Guarantor mergers and releases to accord   with covenant changes and entity structures.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Debt / Liens
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
3.        Lien Covenant
    	
 
    	
Prohibits   Liens securing Indebtedness by the Issuer and Guarantors (other than   Permitted Liens) unless the Notes are equally and ratably secured (§3.6).

 

Permits   Liens on property or assets of a Restricted Subsidiary that is not a   Guarantor (clause (8) of “Permitted Liens”).
    	
 
    	
Prohibits   Liens secured by the Collateral by the Issuer and Restricted Subsidiaries   (other than Permitted Collateral Liens). Prohibits Liens secured by assets   other than the Collateral by the Issuer and Restricted Subsidiaries (other   than Permitted Liens) unless the Notes or Guarantees are equally and ratably   secured.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
4.        Ratio Debt
    	
 
    	
2.0x   PF FCCR, with $100/1.15% of CTA sublimit for non-Guarantor Restricted   Subsidiaries (§3.3(a))
    	
 
    	
Unsecured   or junior lien ratio debt is permitted if > 2.25x Interest Coverage   Ratio on a pro forma basis.  Must be   incurred at Guarantors.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
5.        Credit Agreement and ABL Credit Agreement Baskets
    	
 
    	
Credit   Agreement (Term Loan):  $2,950 plus the   greater of (x) $650 and (y) 4.50x PF Senior Secured Net Leverage   Ratio (includes all secured debt but net of all Unrestricted Cash)   (§3.3(b)(i)).

 

ABL   Credit Agreement:  Greater of   (x) $1,100 and (y) PF Borrowing Base (90% of GAAP A/R + 90% of GAAP   inventory + 100% of GAAP cash and Cash Equivalents as of the most recent   month-end) (§3.3(b)(ii)).

 

$340   outstanding as of 10/31/15.
    	
 
    	
Term   Loan: Will permit the incurrence of the amounts under the Amended Term Loan   Facility outstanding at the Effective Date; however, no Incremental   Term Loans or other debt permitted under this basket other than debt   permitted to be incurred on the Effective Date, Credit Agreement Refinancing   Indebtedness and except as provided below under “Debt Incurred to Refinance   Transaction Holdouts”.

 

ABL: Capacity   to be $1,000, with no borrowing base component.

 

Debt   under the Amended Term Loan Facility and the ABL Credit Agreement (and their   successors) may only be incurred under those respective baskets and may not   be reclassified.

 

Allocate   existing debt to baskets as it is allocated under the existing unsecured   Indenture and not to the “Existing Indebtedness” basket as of the Effective Date. 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
6.        Second Lien/
   Third Lien Debt
    	
 
    	
None.
    	
 
    	
Permits the Second and Third Lien Notes issued at   the Effective Date and any guarantees thereof by the Guarantors.

 

Permits related Liens as contemplated by the Term   Sheets.
    




 











 


	
General
    	
 
    	
Existing Senior Unsecured Notes
    	
 
    	
New Second Lien Notes
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
7.        Debt Incurred to Refinance Transaction Holdouts 
    	
 
    	
N/A
    	
 
    	
First-lien/second   out debt under credit agreement with no amortization, maturity no earlier   than Extended Term Loans, not subject to any “most-favored nation”   provisions, and maximum L+600 cash interest rate may be incurred in a   principal amount equal to the principal amount of non-extending term loans in   order to refinance non-extending term loans.

 

Incremental   third lien notes with no amortization, not subject to any “most-favored   nation” provisions and a maturity no earlier than the New Third Lien Notes   issued on the Effective Date, in an aggregate   principal amount not to exceed 85% of the aggregate principal amount of   non-tendering Unsecured Notes may be incurred to refinance non-tendering   Unsecured Notes, provided that the cash interest rate on such incremental   third lien notes will not exceed that of the New Third Lien Notes on the Effective Date.

 

Non-tendering   Unsecured Notes may be refinanced par-for-par with unsecured debt not subject   to any “most-favored nation” provision but with a cash interest rate not in   excess of that of the existing Unsecured Notes outstanding on the Effective Date and maturity no earlier than the   New Third Lien Notes (and no amortization).

 

Other   provisions of “Permitted Refinancing Indebtedness” apply as provided above.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
8.        Ratio/Junior Liens
    	
 
    	
Up   to 4.50x PF Senior Secured Net Leverage Ratio (Permitted Lien (31))
    	
 
    	
Ratio   basket to be eliminated. 2L will permit junior liens, and 3L will permit   junior liens, but there will be a prohibition on lien layering (i.e., 1.5L   and 2.5L).

 

Not   permitted to be incurred by Restricted Subsidiaries that are not Guarantors;   limited to secure general debt, applicable Transaction Holdouts refinancing,   2.25x interest coverage and other applicable refinancing debt baskets,   subject to intercreditor arrangements to be agreed.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
9.        Purchase Money / Cap Leases
    	
 
    	
$200/2.25%   of CTA (§3.3(b)(v)).
    	
 
    	
Greater of $200 and 2.25% of Consolidated Total   Assets; provided, however, that once the Hudson Yards Indebtedness   obligations cease to be outstanding under this basket, to be capped at the   greater of $100 and 1.125% of Consolidated Total Assets.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
10.     Acquisition/ Assumed
    	
 
    	
Acquired   debt or debt to fund an acquisition, subject to either 2.0x FCCR test or   improvement in FCCR, subject to $125 sublimit at non-Guarantor Restricted   Subsidiaries (§3.3(b)(xii)).
    	
 
    	
Acquisition   debt/assumed debt OK, to be conformed to Term Loan provision:

 

·                  no   EoD,

 

·                  can   incur $1 of Ratio Debt or Interest Coverage Ratio would increase,

 

·                  any   Indebtedness of target retained/assumed will count against the $300 Permitted   Acquisitions basket and $150 sublimit and $25 incremental sublimit in Row 30,   below, and

 

·                  $50   basket for non-Guarantor Restricted Subsidiaries.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
11.     Contribution Indebtedness
    	
 
    	
Up   to 100% of the amount of designated equity contributions.  Can be incurred at non-Guarantor Restricted   Subsidiaries.  (§3.3(b)(xv))
    	
 
    	
Basket   to be eliminated. 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
12.     Qualified Receivables Financings
    	
 
    	
Unlimited   debt of a Receivables Subsidiary under Qualified Receivables Financings.  Fairly standard definitions of the various   related terms, although there are some non-fatal glitches. (§3.3(b)(xvii)
    	
 
    	
Basket   to be eliminated.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
13.     JVs
    	
 
    	
Guarantees   of JV debt up to $50/0.50% of CTA (§3.3(b)(xx)).
    	
 
    	
Basket   to be eliminated.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
14.     Foreign Subsidiary Indebtedness 
    	
 
    	
$50/0.50%   of CTA (§3.3(b)(xxi))
    	
 
    	
$25.
    




 

2











 


	
General
    	
 
    	
Existing Senior Unsecured Notes
    	
 
    	
New Second Lien Notes
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
15.     Certain  Deposits liens
    	
 
    	
Deposits   to secure performance of bids, trade contracts, leases, etc., other   obligations of a like nature incurred in the ordinary course of business
    	
 
    	
Clarify   to cover deposits to secure the delivery of merchandise or services with   factors (to company suppliers), vendors, shippers, brand partners, credit   insurers and other service providers (but not to secure Indebtedness or   receivables or capital lease financing by company). Usage is to be in the   ordinary course of business.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
16.     General Debt basket
    	
 
    	
$250/2.75%   of CTA at the Issuer or any Restricted Subsidiary (§3.3(b)(xxviii)).  
    	
 
    	
$100,   with cap of 8% cash interest on any debt under this basket.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
17.     General Liens basket
    	
 
    	
$250/2.75%   of CTA (Permitted Lien (32)).
    	
 
    	
$50,   with cap of 8% cash interest on any debt secured by liens under this basket.

 

Liens   granted pursuant to general basket securing debt for borrowed money must be   solely on Collateral and must be junior to liens in favor of the New Second   Lien Notes. Indenture governing 3L Notes will permit pari passu or junior   lien debt under this basket.

 

No   liens on non-collateral unless Notes are equally and ratably secured, subject   to exceptions to be agreed in documentation.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
18.     Limitation on Sale/Leaseback Transactions
    	
 
    	
Treated   as secured debt.
    	
 
    	
Treated   as secured debt.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
19.     Refinancing Liens basket
    	
 
    	
Restrictions   on principal amount, maturity, subordination, obligors and security.
    	
 
    	
Same   restrictions apply, including for the avoidance of doubt that refinancing   Liens must be the same or lesser priority relative to the New Second Lien   Notes than those being refinanced.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Restricted   Payments and Investments
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
20.     RP Basket   Builder
    	
 
    	
Requires   PF compliance with 2.0x FCCR and no EoD.

 

Begins   with $200 plus standard 50% of CNI builder since 8/4/13.

 

Includes   100% of FMV of non-cash contributed assets. (§3.4(a))
    	
 
    	
Basket   to be eliminated, but investments funded with net proceeds of common equity   issued by or contributed to Holdings and contributed to Issuer will be   permitted.

 

Payments   to junior debt funded with net proceeds of common equity issued by or   contributed to Holdings and further contributed to the Issuers will be   permitted.

 

In   general, investment capacity under any of the investment baskets cannot be   used for liability management or indirect upstream restricted payments   (including addressing Transaction Holdouts).
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
21.     Dividends   after Qualified IPO
    	
 
    	
Up   to 6% per year of net cash proceeds of public Equity Offerings (§3.4(b)(iv)).
    	
 
    	
Basket   to be eliminated.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
22.     Payment   of Management Fees to Sponsor
    	
 
    	
All   payments pursuant to the Management Agreement (as in effect on the Closing   Date, subject to amendments not materially adverse to the Holders) are   permitted (§3.4(b)(ix)).
    	
 
    	
Indemnities   of, and reimbursement of reasonable and documented out-of-pocket fees and   expenses to Sponsors, in each case incurred in connection with the provision   by Sponsors of bona fide services (including such services provided under the   Management Agreement) to any Parent Entity for the benefit of Holdings and   its Subsidiaries and not, for the avoidance of doubt, in respect of MT   Entities, the MyTheresa Distribution, or any litigation related thereto (other   than litigation for defense), subject to reasonable pro-ration of joint   services/costs.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
23.     RP to   Finance Investments by Parent
    	
 
    	
RP   can be made to finance an Investment by a Parent that would be a Permitted   Investment if made by the Issuer or a Restricted Subsidiary, so long as the   Investment is contributed as soon as practicable to the Issuer or a   Restricted Subsidiary (§3.4(b)(x)).
    	
 
    	
Eliminated.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
24.     RP from   Excluded Contributions
    	
 
    	
RP   can be made from amounts contributed that are designated as “Excluded   Contributions” (§3.4(b)(xii))
    	
 
    	
Eliminated.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
25.     Equity   repurchases from D&Os
    	
 
    	
$30   in any fiscal year with carry-over for 3 years (§3.4(b)(ii)).
    	
 
    	
$20   per fiscal year (no carryforward); limited to current (not former) D&Os, except   permit a basket for former D&Os not to exceed $5 in the aggregate during   life of the New Second Lien Notes.
    




 

3












 


	
General
    	
 
    	
Existing Senior Unsecured Notes
    	
 
    	
New Second Lien Notes
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
26.     Distributions   of Unrestricted Subsidiary Securities
    	
 
    	
Unlimited   distributions of equity or debt of an Unrestricted Subsidiary held by the   Issuer or Restricted Subsidiaries, so long as the primary asset of the   Unrestricted Subsidiary is not cash (§3.4(b)(xiv)).
    	
 
    	
Not   permitted.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
27.     MT   Distribution Basket
    	
 
    	
N/A
    	
 
    	
Subject   to restoration of all terms set forth in Exhibit 5   (the MyTheresa Issuer Preferred Equity Term Sheet) to the Recapitalization   Term Sheet, permit the distribution or dividend of the MT Assets (or proceeds   from a sale of MT Assets or the MT Entities) in the event the MT Assets (or   proceeds from such sale) are contributed to the Issuers or any of their   subsidiaries on or after the Effective   Date to the extent that the MT Assets (or such proceeds) are required to be   distributed in accordance with any settlement, judgment, court order or other   resolution of a Claim, Cause of Action or litigation with respect to the   MyTheresa Distribution or the MyTheresa Designation without being subject to   any conditions or other requirements). 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
28.     General   RP
    	
 
    	
Unlimited   if Total Net Leverage is 3.50x or less (§3.4(b)(xix)).

 

$100/1.5%   of CTA (§3.4(b)(xx)).
    	
 
    	
Basket   to be eliminated.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
29.     Investments   in Restricted Subs
    	
 
    	
Unlimited   (clause (3) of “Permitted Investments”).
    	
 
    	
Unlimited   investments by Issuer or Guarantors only in Restricted Subsidiaries that are   Guarantors.

 

Intercompany   investments in non-Guarantors of $25, must be pledged to secure the Second   Lien Notes, subject to Excluded Assets carveouts (as amended in accordance   with Amended Term Loan Term Sheet).

 

Intercompany   investments with non-wholly owned subsidiaries must be on arm’s-length terms.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
30.     Investments   in Similar Business / Permitted Business Investments
    	
 
    	
$100/1.15%   of CTA in a Similar Business (other than an Unrestricted Subsidiary) that are   “at the time outstanding” (clause (24) of “Permitted Investments”).
    	
 
    	
Replace   with Permitted Acquisitions basket:

 

$300   in aggregate Permitted Acquisitions; provided that (1) no individual   Permitted Acquisition transaction or series of related transactions shall   exceed $150 (except as provided below with respect to incremental   investments) and (2) no Permitted Acquisition transactions if pro forma   ABL availability would be less than $300.    Wholly-owned entities acquired, whether domestic or foreign, to become   Note Parties, provided, further:

 

(i) consideration   consisting of common equity of Holdings/proceeds of common equity issued by   Holdings and contributed to Issuer/contributions to Holdings’ common equity   capital further contributed to Issuer excluded from $300 cap,(1) and

 

(ii) transaction   costs of NMG Group are not part of consideration.

 

“Permitted   Acquisitions” to include acquisitions, minority investments or joint   ventures; provided, that joint ventures (x) may not be consummated with   affiliates of Holdings, the Co-Issuers, or their subsidiaries (except that   such affiliates (including any Sponsor but excluding Holdings, the   Co-Issuers, and their subsidiaries) may co-invest in any such joint venture   with an unaffiliated third party on terms substantially similar to the terms   of the applicable Note Party or Subsidiary’s investment without such   affiliates’ investments being subject to the caps set forth above), and   (y) must be bona fide operating businesses reasonably related to   Issuer’s business and any such acquisition, minority investment or joint   venture may not invest in debt or equity of Holdings or its Subsidiaries.

 

Incremental   investments in entities (in any single or series of transactions) subject to   Permitted Acquisitions will be permitted but count against the $300 aggregate   / $150 per transaction caps; provided however that incremental investments   may exceed such $150 cap by an additional aggregate amount of investments not   to exceed $25 in any such entity (in any single or series of transactions).  By way of example, if a Note Party or its   subsidiary makes an initial investment of $50 in a target entity, such Note   Party or subsidiary would be able 
    




 




(1)         This cannot be double-counted for other baskets.

 

4











 


	
General
    	
 
    	
Existing Senior Unsecured Notes
    	
 
    	
New Second Lien Notes
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
to   make follow-on investments in such target entity in an amount not to exceed   $100, plus an additional $25 (in any single or series of transactions) such   that the total investment in such target entity pursuant to this basket shall   not exceed $175, but subject to the $300 aggregate cap for such basket.

 

Assets   acquired pursuant to Permitted Acquisitions (including 100% of all equity   interests, which shall not, for the avoidance of doubt, constitute Excluded   Assets) must be included in the collateral, and any wholly-owned subsidiary   so acquired (including any wholly-owned foreign subsidiary) must become a   guarantor; provided however that (i) any entity that is acquired which   is not a wholly-owned subsidiary or any minority-owned entity or joint   venture entity shall not be required to become a Guarantor, (ii) any   non-wholly owned subsidiary or any minority-owned entity or joint venture   entity so acquired pursuant to this basket shall be permitted to utilize this   basket to permit such entity to fund its ratable share of investments in   other bona fide operating businesses, subject to the $300 aggregate cap, $150   per transaction cap and $25 incremental cap set forth above, and   (iii) for purposes of clarity, a third party owner (that is not Holdings   or any of its subsidiaries) of a non-wholly owned subsidiary, minority-owned   entity or joint venture entity shall not be required to pledge its equity   interests in such entity as collateral.

 

Any   Indebtedness of target retained/assumed will count against this basket.  See Row 10.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
31.     Investments   from Excluded Contributions
    	
 
    	
Investments   can be made from amounts contributed that are designated as “Excluded   Contributions” (clause (26) of “Permitted Investments”).
    	
 
    	
Basket   to be eliminated, but Issuers retain their ability to make investments using   proceeds of equity contributions, as described in row 20.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
32.     General   Investments
    	
 
    	
$150/1.75%   of CTA (plus the amount of any returns of capital on such Investments)   (clause (27) of “Permitted Investments”).
    	
 
    	
$25,   cannot be in any Parent Entity or its subsidiaries (other than an Issuer or   Guarantor or its subsidiaries), including any MT Entity; must be pledged as   collateral (subject to the Excluded Assets definition in the Amended Term   Loan Term Sheet).
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
33.     Prohibition   on Modification or Prepayment of Junior Financing
    	
 
    	
None.   
    	
 
    	
Provision   limiting modification or prepayment of junior financing (including   subordinated, junior lien or unsecured debt) to be added to conform to   Amended Term Loan Term Sheet (except as provided for above under “Debt   Incurred to Refinance Transaction Holdouts”).    
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Asset   Sales / Dispositions
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
34.     Exceptions
    	
 
    	
Excess   Proceeds trigger of $50.

 

De minimis   exception of $25 (definition of “Asset Sale” (4)).

 

Sale   of assets to a Receivables Subsidiary in a Qualified Receivables Financing or   factoring and the sale or transfer of assets by a Receivables Subsidiary in a   Receivables Financing (definition of “Asset Sale” (10) and (11)).

 

Dispositions   of investments in joint ventures (definition of “Asset Sale” (16)).
    	
 
    	
Excess   Proceeds trigger of $25.

 

De   minimis exception of $15 for all transactions in a calendar year.

 

Eliminate   concept of Qualified Receivables Financing.

 

Eliminate   exception for disposition of investments in joint ventures.
    




 

5











 


	
General
    	
 
    	
Existing Senior Unsecured Notes
    	
 
    	
New Second Lien Notes
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
35.     Asset   Sale Offer / Mandatory Prepayment upon Asset Sale
    	
 
    	
100%   of proceeds from an “Asset Sale” must be applied to make prepayments, subject   to one-year right (extensible by 180 days if a commitment is made during the   year) to (i) reduce obligations under Term Loan or ABL, (ii) reduce   obligations under secured debt (other than subordinated debt),   (iii) reduce obligations under pari debt equally and ratably with the   Notes, (iv) reinvest in permitted acquisitions, (ii) reinvest in   capital expenditures.

 

If   unused proceeds exceed $50, must make an Asset Sale Offer to all holders at   100%.

 

(§3.7(b) and   (c))
    	
 
    	
Excess   Proceeds from Asset Sales of Collateral must be applied to prepay senior lien   debt or New Second Lien Notes at par within 30 days after receipt and must be   held in an account pledged as Collateral securing the New Second Lien Notes,   provided:

 

(i) In   the case of an Asset Sale with respect to a warehouse/distribution center, no   prepayment required to the extent of the cost of any investment in, or   purchase of, a new warehouse/distribution center (but not to exceed the Net   Cash Proceeds of such Asset Sale) completed within 24 months before and 12   months after the date of such Asset Sale.

 

(ii) $30   reinvestment of Net Cash Proceeds from sales or dispositions of stores may be   applied to capex incurred within 12 months of the date of the Asset Sale.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
36.     Asset   Sale Offer / Mandatory Prepayment upon Asset Sale
    	
 
    	
If   Excess Proceeds exceed $50, Issuer must make an offer to all Holders to   purchase Notes to purchase maximum principal amount of such Notes in cash at   a price equal to 100% of the principal amount plus accrued and unpaid   interest to, but excluding the date of purchase.
    	
 
    	
Assumption   of Indebtedness by a purchaser is only deemed to be cash for purposes of an   Asset Sale of Collateral if such Indebtedness is senior debt and is secured   by a lien ranking pari passu with or senior to the New Second Lien Notes.

 

If   unused proceeds exceed $25, the Issuers must make an Asset Sale Offer to all   holders at the optional redemption price then applicable. 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Other
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
37.     Recapitalization   Transactions Carve Outs
    	
 
    	
N/A
    	
 
    	
Permit   transactions contemplated by, and implementation of, the Recapitalization   Transactions throughout agreement as necessary.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
38.     Affiliate   Transaction Threshold and Restricted Subsidiary Affiliate Transactions
    	
 
    	
N/A
    	
 
    	
Require   transactions with non-guarantors to be arm’s length, with exception for   shared overhead in the ordinary course. 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
39.     Certain   Subsidiary Covenants
    	
 
    	
N/A
    	
 
    	
Restrictions   on debt incurrence, liens and other matters, including guarantees of debt other   than loans in order to implement restructuring transactions with respect to   “New Subsidiary” and “PropCo” (if any) that will hold real estate (as to   non-mortgageable assets).
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
40.     Reporting
    	
 
    	
Modified   reporting requirements similar to those imposed on reporting companies under   Section 13 or 15(d) of the Exchange Act 
    	
 
    	
Information   provided under Notes reporting shall include, without limitation, (i) on   a quarterly and annual basis, a narrative discussion of the key financial   metrics of the MT Entities consistent with a customary earnings press   release, (ii) a summary discussion of the financial metrics of the MT   Entities on the quarterly earnings calls of NMG, including a Q&A about   both NMG and MyTheresa.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
41.     RP to   Transaction Holdouts
    	
 
    	
N/A
    	
 
    	
Term   Loans and Unsecured Notes that do not participate in the Recapitalization   Transactions will only be permitted to be repurchased, repaid, exchanged for   and/or refinanced, whether at or prior to their applicable maturities   (including voluntarily), with consideration consisting of:

 

·                  Specified   Permitted Debt or the cash proceeds thereof

 

·                  cash   proceeds of common equity contributions to or common equity sales by   Holdings;

 

·                  non-cash   consideration contributed to the common equity capital of Holdings, or   purchased by Holdings for common equity (including without limitation   interests in MyTheresa so contributed or purchased) and/or common equity of   Holdings; and/or

 

Up   to an aggregate $60 million in cash from whatever other source (excluding   from such cap any consideration described in the above three bullet points);   provided any debt prepaid or purchased pursuant to this $60 million basket   more than 45 days prior to such debt’s maturity date cannot be purchased at a   price greater than (i) 90% in cash of face value in the case of   non-extending term loans and (ii) 40% in cash of face value in the case   of non-extending Unsecured Notes.
    




 

6












 

CONFIDENTIAL

 

March 25, 2019

 

New Second Lien Notes
  Backstop Commitment Letter

 

Neiman Marcus Group LTD LLC

The Neiman Marcus Group LLC

Mariposa Borrower, Inc.

One Marcus Square

1618 Main Street

Dallas, TX 75201

Attention: Tracy M. Preston

 

Ladies and Gentlemen:

 

You have advised (i) Ares Corporate Opportunities Fund III, L.P. (acting through such of its affiliates or branches as it deems appropriate, “Ares Fund III”), (ii) Ares Corporate Opportunities Fund IV, L.P. (acting through such of its affiliates or branches as it deems appropriate, “Ares Fund IV” and, together with Ares Fund IV, “Ares”), (iii) CPP Investment Board Private Holdings (4) Inc. (acting through such of its affiliates as it deems appropriate, “CPPIB” and, together with Ares, the “Sponsors”), and (iv) each of the entities set forth on Schedule 1 to this Commitment Letter (in each case, acting through such of their respective affiliates or branches as they deem appropriate, the “Non-Sponsor Backstop Parties” and, together with Ares and CPPIB, the “Backstop Parties”, “we” or “us”) that, Neiman Marcus Group LTD LLC, a Delaware limited liability company (the “LLC Co-Issuer”), The Neiman Marcus Group LLC, a Delaware limited liability company (the “New Co-Issuer”), Mariposa Borrower, Inc., a Delaware corporation (the “Corporate Co-Issuer”) and one of the New Co-Issuer’s subsidiaries (to be determined by the LLC Co-Issuer, provided that such subsidiary shall be either (x) an entity treated as disregarded as separate from the LLC Co-Issuer for U.S. federal income tax purposes or (y) an entity holding no material assets) (the “New Co-Issuer Subsidiary”) and, together with the LLC Co-Issuer and the New Co-Issuer, the “Issuers” or “you”) intend to issue the New Second Lien Notes, as defined in, and in accordance with, that certain Transaction Support Agreement by and among you, the consenting stakeholders party thereto and the other parties thereto dated as of the date hereof (together with all term sheets and other exhibits or schedules attached thereto, and without giving effect to any amendments, supplements, waivers or modifications thereto, the “TSA”) and on the terms set forth on Exhibit A (the “New Second Lien Notes Term Sheet”).  Capitalized terms used but not otherwise defined in this Commitment Letter are used with the meanings assigned to such terms in the TSA or the Exhibits to this Commitment Letter, as applicable.

 

1.             Commitments.

 

As part of the Recapitalization Transactions, each Backstop Party confirms its several and not joint commitment to purchase on the Closing Date its amount of the aggregate principal amount of the New Second Lien Notes set forth on Schedule 1 (but not less than such aggregate principal amount) upon the terms and conditions set forth in this Commitment Letter (as defined below), the Payment Letter (as defined

 

1











 

below), the New Second Lien Notes Term Sheet, the TSA and the conditions set forth on Exhibit B.  Exhibits A and B, together with this letter, are collectively referred to as this “Commitment Letter”.  The commitments of all Backstop Parties contemplated by this Commitment Letter are referred to collectively as the “Commitments” and the commitment of any Backstop Party contemplated by this Commitment Letter is referred to as such Backstop Party’s “Commitment”.  The transactions contemplated by this Commitment Letter are referred to as the “Transactions”.

 

Notwithstanding anything to the contrary set forth in this Commitment Letter, upon three (3) business days’ written notice from the Issuers, each Backstop Party shall fund its Commitment into escrow on the date that is three (3) business days prior to the date that the Issuers in good faith expect to be the Closing Date (such date, the “Funding Date”) subject only to satisfaction or waiver of the conditions set forth on Exhibit B (excluding the conditions set forth in paragraph 1, 5, 6(b) and 8 of Exhibit B and with references to the “Closing Date” deemed to refer to the “Funding Date”); provided, that (a) if the Closing Date has not occurred on or prior to the fifth (5th) business day following the Funding Date, the Issuers shall refund the purchase price proceeds, including accrued interest from the Funding Date through the refund date as if the New Second Lien Notes have been issued on the Funding Date, received from each Backstop Party to such Backstop Party within two (2) business days thereof and (b) for the avoidance of doubt, the occurrence of the Closing Date shall be conditioned on the satisfaction or waiver of all of the conditions set forth on Exhibit B.  If the Closing Date does occur after the Funding Date, then, for purposes of calculating interest under the New Second Lien Notes, the New Second Lien Notes shall be deemed to have been issued on the Funding Date.

 

For the avoidance of doubt, this Commitment Letter shall not require Non-Sponsor Backstop Parties to purchase the New Second Lien Notes prior to the Exchange Offer Consummation Date; provided that, no later than the third business day prior to such purchase date, each such Non-Sponsor Backstop Party shall confirm in writing the availability of funds to cover such Non-Sponsor Backstop Party’s pro rata portion of the principal amount of New Second Lien Notes.

 

The rights and obligations of each of the Backstop Parties under this Commitment Letter shall be several and not joint, and no failure by any Backstop Party to comply with any of its obligations under this Commitment Letter shall prejudice the rights of any other Backstop Party; provided that no Backstop Party shall be required to fund more than its Commitment or to fund the Commitment of another Backstop Party in the event such other Backstop Party fails to do so (the “Breaching Party”).  In the event a Backstop Party fails to fund its Commitment in whole or in part, each non-defaulting Backstop Party shall have the right, but not the obligation, within five (5) business days after receipt of written notice from the Issuers to all Backstop Parties of such default, to fund such Breaching Party’s Commitment, in whole or in part, in which case such performing Backstop Party shall be entitled to all or a proportionate share, as the case may be, of the New Second Lien Notes and the applicable payments as set forth in the Payment Letter (as defined below) that would otherwise be issued and payable to the Breaching Party.

 

You agree that no compensation (other than that compensation expressly contemplated by this Commitment Letter and the Payment Letter dated the date hereof and delivered in connection herewith (the “Payment Letter”)) will be paid in connection with the New Second Lien Notes unless you and we shall so reasonably agree.

 

2.             Assignments.

 

At any time prior to the earlier of the Closing Date or the termination of this Commitment Letter, this Commitment Letter shall not be assignable by any party without the prior written consent of each other party to this Commitment Letter (and any purported assignment without such consent shall be null and void);  provided, however, that each Backstop Party may, at any time, (i) assign, in whole or in part, its

 

2











 

Commitment to its investment vehicles, affiliated funds, and/or managed accounts or another Backstop Party (it being agreed that any such assigning Backstop Party shall not be relieved, released or novated from its obligations hereunder in respect of any such assigned Commitment until after the initial purchase of the New Second Lien Notes on the Closing Date) or (ii) employ the services of its investment vehicles, affiliated funds, and/or managed accounts in fulfilling its obligations contemplated by this Commitment Letter.  After the Closing Date, nothing in this Commitment Letter shall limit or restrict in any way the ability of any Backstop Party (or any permitted transferee thereof) to transfer any of its New Second Lien Notes; provided that any such transfer shall be made pursuant to the applicable securities laws.  Under no circumstances shall the Issuers have the right to sell, transfer, negotiate or assign their rights hereunder without the prior written consent of each Backstop Party and any such sale, transfer, negotiation or assignment without such consent shall be null and void.

 

3.             Representations and Warranties of the Issuers.

 

The Issuers represent and warrant that (a) all information concerning any of the Issuers and their respective subsidiaries, other than the projections and other forward-looking information, and information of a general economic or industry-specific nature, that has been or will be made available to any Backstop Party by you or any of your affiliates or representatives on your behalf in connection with the Transactions and the Recapitalization Transactions (the “Information”), when taken as a whole, is and will be correct in all material respects and does not and will not, when furnished, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not misleading in light of the circumstances under which such statements are made (after giving effect to all supplements and updates to such statements from time to time) and (b) the projections and other forward-looking information that have been or will be made available to any Backstop Party by you, or any of your affiliates or representatives have been or will be prepared in good faith based upon assumptions believed by you to be reasonable at the time furnished (it being recognized by the Backstop Parties that such projections and other forward-looking information are not to be viewed as facts or guaranties of performance and are subject to significant uncertainties and contingencies many of which are beyond your control, that no assurance can be given that any particular financial projections will be realized, that actual results may differ from projected results and that such differences may be material).  You agree that if, at any time prior to the Closing Date, you become aware that any of the representations and warranties in the preceding sentence would be incorrect if the Information or the projections and other forward-looking information were being furnished and such representations were being made at such time, you will promptly supplement the Information, the projections and other forward-looking information so that the representations and warranties in the preceding sentence remain true in all material respects under those circumstances; provided that any such supplementation prior to the Closing Date shall cure any breach of such representations.

 

In providing its Commitment, each Backstop Party is relying on the accuracy of Information and the projections and other forward-looking information furnished to it by or on behalf of the Issuers or any of their respective representatives without independent verification thereof.

 

4.             Payment Letter.

 

As consideration for the commitments and agreements of the Backstop Parties hereunder, you agree to pay or cause to be paid the non-refundable payments described in the Payment Letter on the terms and subject to the conditions expressly set forth in the Payment Letter.

 

5.             Sharing of Information, Absence of Fiduciary Relationship.

 

You acknowledge that each Backstop Party may be (or may be affiliated with) a full service financial firm

 

3











 

and as such from time to time may, and its affiliates may, (a) effect transactions for its own or its affiliates’ account or the account of customers, and hold long positions in debt or equity securities, loans or other securities and financial instruments of companies that may be the subject of the Transactions or the Recapitalization Transactions or (b) provide debt financing, equity capital, investment banking, financial advisory services, securities trading, hedging, financing and brokerage activities and financial planning and benefits counseling to other companies or similar services in respect of which you, the Sponsors or your and their respective subsidiaries may have conflicting interests. With respect to any debt or equity securities, loans or other securities and/or financial instruments so held by any Backstop Party or any of its affiliates or customers, all rights in respect of such debt or equity securities, loans or other securities and financial instruments, including any voting rights, will (subject to the TSA) be exercised by the holder of the rights, in its sole discretion.  Without limiting the rights of the Issuers or the Sponsors under the TSA, the Issuers and the Sponsors, jointly and severally, hereby waive and release, to the fullest extent permitted by law, any claims each of them has or will or may have hereunder with respect to any conflict of interest arising from such transactions, activities, investments or holdings, or arising from the failure of any Backstop Party or any of its respective affiliates or customers to bring such transactions, activities, investments or holdings to their attention.

 

You also acknowledge that the Non-Sponsor Backstop Parties and their respective affiliates have no obligation to use in connection with the Transactions or the Recapitalization Transactions, or to furnish to you, confidential information obtained from other companies or other persons, and that the Non-Sponsor Backstop Parties and their affiliates shall not be imputed to have knowledge of confidential information provided to or obtained by such Non-Sponsor Backstop Parties or their affiliates in their capacity as financial advisors to you.  You acknowledge and agree that (a)(i) the arrangements described in this Commitment Letter regarding the New Second Lien Notes, the Transactions and the Recapitalization Transactions are arm’s-length commercial transactions between you and your affiliates, on the one hand, and the Non-Sponsor Backstop Parties and/or their applicable affiliates, on the other hand, that do not directly or indirectly give rise to, nor do you rely on, any fiduciary or other implied duty on the part of the Non-Sponsor Backstop Parties and their applicable affiliates and each Non-Sponsor Backstop Party and such affiliates expressly disclaims any fiduciary or other implied relationship to any party hereto or any of such parties’ affiliates or any other person or entity, (ii) you have consulted your own legal, accounting, regulatory and tax advisors to the extent you have deemed appropriate and you are not relying on the Non-Sponsor Backstop Parties or their applicable affiliates for such advice, and (iii) you are capable of evaluating, and understand and accept, the terms, risks and conditions of the Transactions and the Recapitalization Transactions; and (b) in connection with the Transactions and the Recapitalization Transactions, (i) each Non-Sponsor Backstop Party, in its capacity as such, and/or its applicable affiliates has been, is, and will be acting solely as a principal and, except as otherwise expressly agreed in writing by the relevant parties, in such capacity, has not been, is not, and will not be acting as an advisor, agent or fiduciary to you or any of your affiliates or any other party hereto or any of such parties’ affiliates or any other person or entity; and (ii) no Non-Sponsor Backstop Party and/or its affiliates has an obligation to you or your affiliates except those obligations expressly set forth in this Commitment Letter and any other agreement with you or any of your affiliates (including, without limitation, the TSA). Any review by the Non-Sponsor Backstop Parties of you, your subsidiaries, the Transactions, the Recapitalization Transactions or other matters relating to such transactions will be performed solely for the benefit of such Non-Sponsor Backstop Parties and shall not be on behalf of you or any of your affiliates.

 

The parties hereto acknowledge that this Commitment Letter does not constitute an agreement, arrangement or understanding with respect to acting together for the purpose of acquiring, holding, voting, or disposing of any securities of the Issuers and the Backstop Parties do not constitute a “group” within the meaning of Rule 13d-5 under the Securities Exchange Act of 1934, as amended.  Nothing contained in this Commitment Letter, the Payment Letter or in any Definitive Documentation with respect to the New Second Lien Notes (the “Note Documentation”) and no action taken by any Backstop Party pursuant to this Commitment

 

4











 

Letter, the Payment Letter or the Note Documentation shall be deemed to constitute or to create a presumption by any parties that the Backstop Parties are in any way acting in concert or as a “group” (or a joint venture, partnership or association), and the Issuers will not assert any such claim with respect to such obligations or the Transactions contemplated by this Commitment Letter, the Payment Letter or the Note Documentation, and the Issuers acknowledge that the Backstop Parties are not acting in concert or as a “group” with respect to such obligations or the transactions contemplated by this Commitment Letter, the Payment Letter or the Note Documentation.

 

6.             Indemnification.

 

The Issuers, jointly and severally, hereby agree to indemnify and hold harmless each Backstop Party and each of its affiliates and all their respective officers, directors, partners, trustees, employees, managed funds and accounts, shareholders, advisors, agents, representatives, attorneys and controlling persons and each of their respective heirs, successors and assigns (each, an “Indemnified Person”) from and against any and all actual losses, claims, damages, and liabilities, joint or several, to which any such Indemnified Person may become subject as a direct result of this Commitment Letter, the Payment Letter or the initial purchase of the New Second Lien Notes (and, for the avoidance of doubt, not arising out of or in connection with the Recapitalization Transactions generally) or any claim, litigation, investigation or proceeding relating to any of the foregoing, regardless of whether any Indemnified Person is a party thereto and whether or not the transactions contemplated hereby are consummated, and to reimburse each Indemnified Person within 30 days following written demand therefor (together with reasonable backup documentation supporting such reimbursement request) for any reasonable and documented out-of-pocket expenses (including legal expenses) incurred in connection with investigating, preparing to defend or defending, or providing evidence in or preparing to serve or serving as a witness with respect to, any lawsuit, investigation, claim or other proceeding relating to any of the foregoing (including, without limitation, in connection with the enforcement of the indemnification obligations set forth herein, but limited, in the case of legal fees and expenses, to one counsel to such Indemnified Persons taken as a whole and, solely in the case of an actual or perceived conflict of interest, one additional counsel to all affected Indemnified Persons, taken as a whole (and, if reasonably necessary, of one local counsel in any relevant jurisdiction to all such persons, taken as a whole and, solely in the case of an actual or perceived conflict of interest, one additional local counsel to all affected Indemnified Persons, taken as a whole)); provided that no Indemnified Person will be entitled to indemnity hereunder in respect of any loss, claim, damage, liability or related expense to the extent that it is found by a final, non-appealable judgment of a court of competent jurisdiction that such loss, claim, damage, liability or expense arises from (i) the bad faith, gross negligence or willful misconduct of or material breach of this Commitment Letter or the Payment Letter by, such Indemnified Person (or any of its Related Parties (as defined below)) or (ii) any disputes solely among Indemnified Persons and not arising out of any act or omission of the Issuers, the Sponsors, any of the Issuers’ or the Sponsors’ respective subsidiaries.

 

In no event will any Indemnified Person, any other party hereto, the Issuers, or any of the Issuers’ respective affiliates or any of their respective officers, directors, partners, trustees, employees, managed funds and accounts, shareholders, advisors, agents, representatives, attorneys and controlling persons and each of their respective heirs, successors and assigns be liable on any theory of liability for indirect, special, or consequential damages, lost profits or punitive damages in connection with this Commitment Letter, the Payment Letter or the initial purchase of the New Second Lien Notes; provided that nothing contained in this sentence shall limit the Issuers’ indemnification obligations to the extent set forth hereinabove to the extent such special, indirect, consequential or punitive damages are included in any third party claim in connection with which such Indemnified Person is entitled to indemnification hereunder.

 

For the avoidance of doubt, the Sponsors (and their respective subsidiaries (other than the Issuers)) are Indemnified Persons and are not providing any indemnity.

 

5











 

The Issuers shall not be liable for any settlement of any proceeding (or expenses relating thereto) effected without the Issuers’ consent (which consent shall not be unreasonably withheld, conditioned or delayed), but if settled with the Issuers’ written consent, or if there is a final judgment against an Indemnified Person in any such proceeding, the Issuers agree to indemnify and hold harmless such Indemnified Person to the extent and in the manner set forth above.  The Issuer shall not, without the prior written consent of the affected Indemnified Person (which consent shall not be unreasonably withheld, conditioned or delayed), effect any settlement of any pending or threatened proceeding against such Indemnified Person in respect of which indemnity could have been sought hereunder by such Indemnified Person unless such settlement (a) includes an unconditional release of such Indemnified Person from all liability or claims that are the subject matter of such proceeding, (b) does not include any statement as to any admission of fault or culpability, and (c) includes customary confidentiality and non-disparagement agreement.  Notwithstanding the foregoing, each Indemnified Person shall be obligated to refund or return any and all amounts paid by the Issuers under this paragraph to such Indemnified Person for any losses, claims, damages, liabilities and expenses to the extent such Indemnified Person is not entitled to payment of such amounts in accordance with the terms hereof, as determined by a final non-appealable order.

 

The indemnity, contribution and expense reimbursement obligations set forth herein (i) shall be in addition to any liability the Issuers may have to any Indemnified Person at law, in equity or otherwise, (ii) shall survive the expiration or termination of this Commitment Letter, (iii) shall remain operative and in full force and effect regardless of any investigation made by or on behalf of the Backstop Parties or any other Indemnified Person and (iv) shall be binding on any successor or assign of the Issuers and the successors or assigns to any substantial portion of its business and assets.

 

For the avoidance of doubt, this indemnity does not apply to or cover any matter for which any Indemnified Person or its Related Parties has released (or will release) the Issuers or their affiliates including, without limitation, pursuant to the Release (as defined in the TSA).

 

For purposes hereof, “Related Party” and “Related Parties” of an Indemnified Person mean any (or all, as the context may require) of such Indemnified Person’s affiliates and controlling persons and its or their respective officers, directors, partners, trustees, employees, managed funds and accounts, shareholders, advisors, agents, representatives, attorneys and controlling persons.

 

Notwithstanding anything to the contrary contained herein, upon the execution of the Note Documentation, solely to the extent the provisions of this Section 6 are covered thereby, (i) the relevant provisions of such definitive documentation shall supersede the provisions of this Section 6 that are covered thereby and (ii) the Issuers shall be released from the provisions of this Section 6 that are covered thereby and shall have no further liability or obligation pursuant to the provisions of this Section 6 to reimburse an Indemnified Person for losses, claims, damages, liabilities, expenses, fees or any such indemnified obligations pursuant to the provisions in this Section 6 that are covered thereby.

 

7.             Termination/Expiration of Commitments.

 

The Commitments hereunder will expire automatically without any further action or notice by any party at 5:00 p.m., New York City time, on March 25, 2019, unless on or prior to such time each party hereto has duly executed and delivered to the other parties hereto this Commitment Letter.  Following the execution and delivery of this Commitment Letter, the obligations of each Backstop Party under this Commitment Letter, including the obligation to fund its Commitment contemplated hereby, shall terminate automatically and immediately without any further action or notice by any party upon the earliest to occur of:  (i) the consummation of the Recapitalization Transactions in accordance with the TSA and the funding of the Commitments in accordance with the terms of this Commitment Letter and the Payment Letter, (ii) any of (a) the Company Parties, (b) Consenting Unsecured Noteholders constituting the Required Consenting

 

6











 

Unsecured Noteholders, (c) Consenting Term Loan Lenders constituting the Required Consenting Term Loan Lenders, or (d) the Sponsors, respectively, validly terminate(s) the TSA prior to the Effective Date (as defined in the TSA) in accordance with its terms (any of the foregoing events described in this clause (ii), a “Termination Event”), and (iii) 5:00 p.m., New York City time, on the date set forth in Section 12.01(m) of the TSA (as extended in accordance with the terms of the TSA); provided, in each case, that any such termination shall not relieve any party hereto from any liability in connection with a breach of this Commitment Letter that occurred before such termination.

 

8.             Confidentiality.

 

The existence of this Commitment Letter and the terms and conditions herein are for the Issuers’ confidential use only and may not be disclosed by the Issuers to any person or entity (other than to the Issuers’ officers, directors, agents, attorneys and advisors who need to know and agree to be bound by the provisions of this paragraph) without the prior written consent of each Backstop Party; provided that this Commitment Letter and its terms (other than the Payment Letter and its contents) may be disclosed by the Issuers as required (a) to consummate the Recapitalization Transactions (including public filings in connection with the Recapitalization Transactions), (b) by applicable law, including applicable securities law in the good faith opinion of the Issuers’ outside securities counsel, or (c) pursuant to an order of a court of competent jurisdiction or any other governmental authority; provided further that the Issuers shall not disclose Schedule 1 of this Commitment Letter unless required to do so under applicable law or court order.  The parties also acknowledge that the Backstop Parties have previously executed the TSA, which contains certain confidentiality provisions which apply to this Commitment Letter and the transactions contemplated hereby.

 

9.             Governing Law; Jurisdiction; Waivers.

 

This Commitment Letter, and any claim, controversy or dispute arising under or related to this Commitment Letter, whether in tort, contract (at law or in equity) or otherwise, shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York without regard to principles of conflicts of law thereof to the extent such principles would cause the application of the law of another state.  Each of the parties to this Commitment Letter irrevocably and unconditionally (a) submits to the exclusive jurisdiction of any state or federal court sitting in the Borough of Manhattan in the City of New York (or any appellate court therefrom) over any suit, action or proceeding arising out of or relating to this Commitment Letter or the Payment Letter and (b) agrees that a final judgment in any such action may be enforced in any such court.  You and we agree that service of any process, summons, notice or document by registered mail addressed to such person shall be effective service of process against such person for any suit, action or proceeding brought in any such court.  Each of the parties to this Commitment Letter irrevocably and unconditionally waives any objection to the laying of venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding has been brought in an inconvenient forum.  The parties hereto hereby waive, to the fullest extent permitted by applicable law, any right to trial by jury with respect to any action or proceeding arising out of or relating to this Commitment Letter or the Payment Letter.

 

10.          Miscellaneous.

 

This Commitment Letter has been and is made solely for the benefit of the parties signatory hereto and, with respect to Section 6 hereof, the Indemnified Persons, and nothing in this Commitment Letter, expressed or implied, is intended to confer or does confer on any other person or entity any rights or remedies under or by reason of this Commitment Letter or the agreements of the parties contained herein.  This Commitment Letter may not be amended or waived except by an instrument in writing signed by each party hereto.

 

7











 

This Commitment Letter, the Payment Letter, the TSA and the exhibits hereto and thereto or in any supplement thereto set forth the entire understanding of the parties hereto as to the scope of the Commitments and the obligations of the Backstop Parties hereunder, and supersede all prior agreements, understandings and proposals, whether written or oral, between the Backstop Parties and you relating to the Commitments.

 

This Commitment Letter may be executed in one or more counterparts, each of which will be deemed an original, but all of which taken together will constitute one and the same instrument.  Delivery of an executed signature page of this Commitment Letter by facsimile or other electronic transmission (including “.pdf”, “.tif” or similar format) shall be effective as delivery of a manually executed counterpart hereof.

 

Sections 4 (Payment Letter), 5 (Sharing of Information; Absence of Fiduciary Relationship), 6 (Indemnification), 8 (Confidentiality), and 9 (Governing Law; Jurisdiction; Waivers) contained in this Commitment Letter shall remain in full force and effect regardless of whether the Note Documentation shall be executed and delivered and notwithstanding the termination or expiration of this Commitment Letter or the Commitments hereunder, subject, in the case of Section 6 (Indemnification), to the terms of the last paragraph of such section.

 

Each of the parties to this Commitment Letter agrees that each of this Commitment Letter and the Payment Letter is a binding and enforceable agreement with respect to the subject matter contained in this Commitment Letter or the Payment Letter (including an obligation to negotiate the Note Documentation in good faith in a manner consistent with this Commitment Letter); it being acknowledged and agreed that (a) the issuance and initial purchase of the New Second Lien Notes are subject in all respects to the terms and conditions set forth in this Commitment Letter, the Payment Letter, the New Second Lien Notes Term Sheet, the TSA and the conditions set forth on Exhibit B (provided, that the only conditions to the initial purchase of the New Second Lien Notes are the conditions set forth on Exhibit B) and (b) the terms of the Note Documentation shall be consistent with the New Second Lien Notes Term Sheet and not impair the purchase of the New Second Lien Notes as set forth herein on the Closing Date (or Funding Date as applicable) if the conditions set forth on Exhibit B are satisfied or waived.

 

Each of the Backstop Parties notifies you that, pursuant to the requirements of the USA PATRIOT Act, Title III of Pub. L. 107-56 (signed into law on October 26, 2001) (the “PATRIOT Act”), it is required to obtain, verify and record information that identifies each Issuer and each Guarantor, which information includes names, addresses, tax identification numbers and other information that will allow each Backstop Party to identify each Issuer and each Guarantor in accordance with the PATRIOT Act.  This notice is given in accordance with the requirements of the PATRIOT Act and is effective for each Backstop Party.

 

[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

 

8




 









 

We are pleased to have been given the opportunity to assist you in connection with this important financing.

 

	
 
    	
Very truly yours,
    
	
 
    	
 
    
	
 
    	
ARES CORPORATE OPPORTUNITIES   FUND III, L.P.
    
	
 
    	
 
    
	
 
    	
By: 
    	
ACOF Management III,   L.P.
    
	
 
    	
Its: 
    	
General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
By: 
    	
ACOF Management III GP   LLC
    
	
 
    	
Its: 
    	
General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
By 
    	
/s/ Dennis Gies
    
	
 
    	
 
    	
Name: Dennis Gies
    
	
 
    	
 
    	
Title:
    


 

SIGNATURE PAGE TO COMMITMENT LETTER

 











 

	
 
    	
ARES CORPORATE OPPORTUNITIES   FUND IV, L.P.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
ACOF Management IV,   L.P.
    
	
 
    	
Its:
    	
General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
ACOF Management IV GP   LLC
    
	
 
    	
Its:
    	
General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By 
    	
/s/ Dennis Gies
    
	
 
    	
 
    	
Name: Dennis Gies
    
	
 
    	
 
    	
Title:
    


 

2











 

	
 
    	
CPP INVESTMENT BOARD PRIVATE HOLDINGS   (4) INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By 
    	
/s/ Lori Hall-Kimm
    
	
 
    	
 
    	
Name:
    	
Lori Hall-Kimm
    
	
 
    	
 
    	
Title:
    	
Authorized Signatory
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By 
    	
/s/ Cesare Ruggiero
    
	
 
    	
 
    	
Name: Cesare Ruggiero
    
	
 
    	
 
    	
Title: Authorized   Signatory
    


 

3











 

	
 
    	
SOUTHEASTERN ASSET
    
	
 
    	
MANAGEMENT, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
 /s/ Andrew R. McCarroll
    
	
 
    	
 
    	
Name: Andrew R.   McCarroll
    
	
 
    	
 
    	
Title: General Counsel
    


 

4











 

	
 
    	
P. SCHOENFELD ASSET MANAGEMENT   LP,
    
	
 
    	
as   investment adviser on behalf of certain funds
    
	
 
    	
and   accounts
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By 
    	
/s/ Dhananjay Pai
    
	
 
    	
 
    	
Name: Dhananjay Pai
    
	
 
    	
 
    	
Title:   President & COO
    


 

5












 

	
 
    	
MARATHON ASSET MANAGEMENT,
    
	
 
    	
L.P., on behalf of certain   funds or
    
	
 
    	
accounts it manages
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Louis Hanover
    
	
 
    	
 
    	
Name:
    	
Louis Hanover
    
	
 
    	
 
    	
Title:
    	
Co-Managing Partner
    


 

SIGNATURE PAGE TO PAYMENT LETTER

 

6











 

	
 
    	
The Indianapolis High Yield Desk of J.P.   Morgan Investment Management Inc. and JPMorgan Chase Bank, N.A.   (“Signatory”), solely as investment manager and/or trustee on behalf of funds   and/or accounts managed and/or advised by it (as outlined in the Transaction   Support Agreement).
    
	
 
    	
 
    
	
 
    	
By executing this agreement, Signatory,   solely as investment manager and/or trustee on behalf of funds and/or   accounts managed and/or advised by it, binds only itself, and itself only in   that capacity, and not any other affiliate of JPMorgan Chase & Co.,   or any of its or their respective business units, subsidiaries or affiliates   (including any desk or business unit thereof), and no such affiliate shall be   deemed to be bound by the terms of this agreement by virtue of Signatory’s   execution of this agreement. Moreover, Signatory shall have no obligation to   cause any of its affiliates to take or refrain from taking any action.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By 
    	
/s/ Greg Seketa
    
	
 
    	
 
    	
Name: Greg Seketa
    
	
 
    	
 
    	
Title: Executive   Director
    


 

7











 

	
 
    	
The Cincinnati High Yield Desk of J.P.   Morgan Investment Management Inc. and JPMorgan Chase Bank, N.A. (“Signatory”),   solely as investment manager and/or trustee of certain discretionary accounts   holdings the Unsecured Notes (as defined in the Transaction Support   Agreement).
    
	
 
    	
 
    
	
 
    	
By executing this agreement, Signatory,   solely as investment manager and/or trustee of certain discretionary accounts   holding the Unsecured Notes, binds only itself, and itself only in that   capacity, and not any other affiliate of JPMorgan Chase & Co., or   any of its or their respective business units, subsidiaries or affiliates (including   any desk or business unit thereof), and no such affiliate shall be deemed to   be bound by the terms of this agreement by virtue of Signatory’s execution of   this agreement. Moreover, Signatory shall have no obligation to cause any of   its affiliates to take or refrain from taking any action.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By 
    	
/s/ Michael J.   Schlembach
    
	
 
    	
 
    	
Name: Michael J.   Schlembach
    
	
 
    	
 
    	
Title: Executive   Director
    


 

8











 

	
CVC Global Credit Opportunities Master Fund II,   LP
    	
 
    
	
 
    	
 
    
	
CVC Global Credit Opportunities Master Fund,   L.P.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
signed on behalf of their respective   investment manager,
    	
 
    
	
 
    	
 
    
	
CVC CREDIT PARTNERS, LLC
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
/s/ Richard Perris
    	
 
    
	
Name: Richard Perris
    	
 
    
	
Title: Authorized Signatory
    	
 
    


 

9











 

	
CVC European Credit Opportunities S.á.r.l.   (acting in respect of its compartment A)
    	
 
    
	
 
    	
 
    
	
signed   on behalf of their respective investment manager,
    	
 
    
	
 
    	
 
    
	
CVC   CREDIT PARTNERS INVESTMENT MANAGEMENT LIMITED
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
/s/   Hamish Buckland
    	
 
    
	
Name:   Hamish Buckland
    	
 
    
	
Title:   Authorized Signatory
    	
 
    


 

10












 

	
 
    	
CAPITAL INTERNATIONAL SARL, for   and on behalf of funds and/or accounts managed and/or advised by it
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Fabrice Remy
    
	
 
    	
 
    	
Name: Fabrice REMY
    
	
 
    	
 
    	
Title: Senior Vice   President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Guido Caratsch
    
	
 
    	
 
    	
Name: Guido CARATSCH
    
	
 
    	
 
    	
Title: Senior Vice   President
    


 

11











 

	
 
    	
CAPITAL RESEARCH AND MANAGEMENT COMPANY, for   and on behalf of funds and/or accounts managed and/or advised by it
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/   Kristine M. Nishiyama
    
	
 
    	
 
    	
Name:   Kristine M. Nishiyama
    
	
 
    	
 
    	
Title:   Authorized Signatory
    


 

12











 

	
 
    	
ALBACORE PARTNERS I INVESTMENT   HOLDINGS B DESIGNATED ACTIVITY COMPANY
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By 
    	
/s/ Safraz Zavahir
    
	
 
    	
 
    
	
 
    	
ALBACORE CAPITAL LLP as   investment manager for and on behalf of AlbaCore Capital Limited as AIFM for   ALBACORE PARTNERS I INVESTMENT HOLDINGS B DESIGNATED ACTIVITY COMPANY
    
	
 
    	
 
    
	
 
    	
 
    	
Name: Safraz Zavahir
    
	
 
    	
 
    	
Title: Member
    


 

13











 

	
Accepted and agreed to   as of the date first above written:
    	
 
    
	
 
    	
 
    
	
NEIMAN MARCUS GROUP LTD LLC
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Tracy M. Preston
    	
 
    
	
Name:
    	
Tracy M. Preston
    	
 
    
	
Title:
    	
Senior Vice President,   General Counsel, Corporate
    	
 
    
	
 
    	
Secretary and Chief   Compliance Officer
    	
 
    
	
 
    	
 
    
	
THE NEIMAN MARCUS GROUP LLC
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Tracy M. Preston
    	
 
    
	
Name:
    	
Tracy M. Preston
    	
 
    
	
Title:
    	
Senior Vice President,   General Counsel, Corporate
    	
 
    
	
 
    	
Secretary and Chief Compliance   Officer
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
MARIPOSA BORROWER, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Tracy M. Preston
    	
 
    
	
Name:
    	
Tracy M. Preston
    	
 
    
	
Title:
    	
Vice President and   Secretary
    	
 
    


 

14












 

SCHEDULE 1

STRICTLY CONFIDENTIAL

 

COMMITMENTS

 

[On file with the Issuers]

 











 

EXHIBIT A

 

NEW SECOND LIEN NOTES TERM SHEET

 

[Refer to Exhibit 1 of the

Recapitalization Term Sheet]

 











 

EXHIBIT B

 

CONDITIONS

 

The initial purchase of the New Second Lien Notes shall be subject to the satisfaction (or waiver by (i) the Non-Sponsor Backstop Parties holding in excess of 50% of the commitments under the Commitment Letter to purchase New Second Lien Notes, excluding the commitments of the Sponsors (the “Majority Backstop Parties”) and (ii) the Sponsors) of the following conditions:

 

1.                                      All of the conditions to consummation of the Recapitalization Transactions on the terms and conditions specified in the TSA shall have been satisfied or waived and the Recapitalization Transactions shall have been (or shall substantially concurrently with the issuance of the New Second Lien Notes be) consummated.

 

2.                                      A Termination Event shall not have occurred and be continuing.

 

3.                                      With respect to Non-Sponsor Backstop Parties, confirmation from the Issuers that Ares and CPPIB have funded their respective Commitments in accordance with the terms of the Commitment Letter.

 

4.                                      The Note Documentation (which shall be consistent with the New Second Lien Notes Term Sheet and the Commitment Letter and otherwise mutually and reasonably acceptable to the Issuers, the Majority Backstop Parties and the Sponsors) shall have been executed and delivered by each Issuer and each Guarantor, and the Backstop Parties shall have received customary closing certificates and legal opinions for the Issuers and the material Guarantors.

 

5.                                      All documents and instruments necessary to establish that the Backstop Parties will have perfected security interests (with the priority set forth in the TSA) in the collateral described in the New Second Lien Notes Term Sheet (the “Collateral”) shall have been delivered (it being understood that, to the extent any security interest in the Collateral or any deliverable related to the perfection of security interests in the Collateral (other than any Collateral the security interest in which may be perfected by the filing of a uniform commercial code financing statement or the possession of the stock certificates of the Issuers, any domestic subsidiary, or any PropCo) is not or cannot be provided and/or perfected on the Closing Date (1) without undue burden or expense or (2) after your use of commercially reasonable efforts to do so, then the provision and/or perfection of such security interests or deliverable shall not constitute a condition precedent to the initial purchase of the New Second Lien Notes on the Closing Date but shall be required to be delivered after the Closing Date pursuant to arrangements and timing to be mutually agreed by the Majority Backstop Parties, the Sponsors and the Issuers).

 

6.                                      (a) The Commitment Payment as required to be paid pursuant to the Payment Letter and (b) all fees and expenses required to be paid on the Closing Date pursuant to the TSA, in each case shall have been or concurrently herewith will be paid.

 

7.                                      The Backstop Parties shall have received from the Issuers, no later than 3 business days in advance of the Closing Date, in each case, to the extent reasonably requested by the Backstop Parties at least 10 business days in advance of the Closing Date, (a) all documentation and other information required by regulatory authorities under applicable

 

1











 

“know your customer” and anti-money laundering rules and regulations, including, without limitation, the PATRIOT Act and (b) to the extent any Issuer qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, a certification regarding beneficial ownership required by the Beneficial Ownership Regulation.

 

8.                                      The Issuers shall have requested, at least three (3) business days prior to the Closing Date, that the Backstop Parties purchase the Notes.

 

For purposes of the Commitment Letter and the Payment Letter, “Closing Date” shall mean the date of the satisfaction (or waiver by (i) the Majority Backstop Parties and (ii) the Sponsors) of the relevant conditions set forth in the Commitment Letter, the Payment Letter, the TSA and this Exhibit B and the issuance and initial purchase of the New Second Lien Notes.

 

2












 

EXHIBIT 3

 

New Third Lien Notes Term Sheet

 

The following summarizes the principal terms of the New Third Lien Notes.(3)

 

	
New 8.000% Notes
    	
 
    	
Up to $960 million in aggregate principal amount.
    
	
 
    	
 
    	
 
    
	
New 8.750% Notes
    	
 
    	
Up to $658 million in aggregate principal amount   (together with the New 8.000% Notes, the “New Third Lien Notes”).
    
	
 
    	
 
    	
 
    
	
Issuers
    	
 
    	
The Issuers as defined in Exhibit 1.
    
	
 
    	
 
    	
 
    
	
Guarantors
    	
 
    	
The New Third Lien Notes will be jointly and   severally guaranteed on a senior secured basis with the priorities described   in “Security/Ranking” below by the   Guarantors (as defined in Exhibit 1)   other than the MT Guarantor Entities.


   The priority of the guarantees from PropCo and New Subsidiary (as defined in Exhibit 5) shall be as provided in “Guarantors” in Exhibit 1.


   Notwithstanding the foregoing, (i) no direct or indirect Subsidiary or   equity investee of Mariposa Intermediate may directly or indirectly provide   credit support for the New Third Lien Notes, and (ii) no direct or   indirect Subsidiary or equity investee of Mariposa Intermediate may be an   obligor on any indebtedness for borrowed money for which any Note Party   (other than the MT Guarantor Entities) directly or indirectly provides credit   support, unless, in each case of clause (i) and (ii), such Subsidiary or   equity investee becomes a guarantor of the Extended Term Loans; provided that   the foregoing shall not apply to the provision of credit support for the New   Third Lien Notes as contemplated by this Exhibit 3   by MT Holdco and its subsidiaries.


   Notwithstanding the foregoing, (i) no direct or indirect Subsidiary or   equity investee of Mariposa Intermediate may directly or indirectly provide   credit support for the Extended Term Loans (as defined in Exhibit 5),   and (ii) no direct or indirect Subsidiary or equity investee of Mariposa   Intermediate may be an obligor on any indebtedness for borrowed money for   which any guarantor or obligor on the Extended Term Loans directly or indirectly   provides credit support, unless, in each case of clause (i) and (ii),   such Subsidiary or equity investee becomes a Note Party.
    
	
 
    	
 
    	
 
    
	
Security/Ranking
    	
 
    	
The New Third Lien Notes, related guarantees and   other obligations under the Definitive Documents related thereto (the “New   Third Lien Obligations”) shall be subject to the following credit   support:



·                  to   the extent the PropCo Assets are able to be pledged or mortgaged to secure   the New Third Lien Obligations, the New Third Lien Obligations shall be   secured by a first-priority lien on those PropCo Assets, subject to the Call   Right (as defined in Exhibit 1);
    


 




(3)                                 Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to such terms in the Transaction Support Agreement, dated as of March 25, 2019 (including the Recapitalization Term Sheet and the exhibits thereto) (the “Agreement”).

 











 

	
 
    	
 
    	
·                  to   the extent the PropCo Assets are not able to be pledged or mortgaged to   secure the New Third Lien Obligations, such PropCo Assets shall be held by   PropCo, and the New Third Lien Obligations shall be secured by a   first-priority pledge of the equity of PropCo, subject to the Call Right;

·                  the   New Third Lien Obligations shall be secured on a third-priority basis by the   Extended Term Loan Collateral (as defined in Exhibit 5)   (including leaseholds and other real property interests constituting Extended   Term Loan Collateral that cannot be pledged, through a third-priority pledge   of the equity interests of New Subsidiary); and

·                  on   a fourth-priority basis by the ABL Priority Collateral.



In addition, 50% of the common equity of the MT   Issuer shall be pledged by MT Holdco to secure the New Third Lien Obligations   on a first-priority basis (the “MT Common Equity”).


   The indebtedness evidenced by the New Third Lien Notes and the guarantees of   the New Third Lien Notes will be effectively senior to all of the Issuers’   and the Guarantors’ future unsecured indebtedness, to the extent of the value   of the applicable Collateral, and structurally junior to all liabilities of   any of the Issuers’ subsidiaries that are not Guarantors.
    
	
 
    	
 
    	
 
    
	
Maturity
    	
 
    	
The New Third Lien Notes will mature on   October 25, 2024.
    
	
 
    	
 
    	
 
    
	
Interest
    	
 
    	
New 8.000% Notes: Interest on the   New 8.000% Notes will accrue from the Effective Date at the rate of 8.000%   per annum, payable semi-annually in arrears in cash.



New 8.750% Notes: Interest on the   New 8.750% Notes will accrue from the Effective Date at the rate of 8.750%   per annum, payable semi-annually in arrears in cash.
    
	
 
    	
 
    	
 
    
	
Optional Redemption
    	
 
    	
The New Third Lien Notes shall be redeemable   pursuant to, and for the redemption prices, provided for with respect to the   Cash Pay Notes and PIK Toggle Notes, as applicable, under the Indentures.
    
	
 
    	
 
    	
 
    
	
Mandatory Redemption
    	
 
    	
Upon any liquidation, dissolution or winding up of   all of the MT Issuer’s assets, or any MT Secondary Sale, to the extent   required under “Distributions Upon   Realizations of Value” on Exhibit 4,   the proceeds thereof shall be applied to redeem, on a pro rata basis, a   portion of the New Third Lien Notes at a redemption price of 100% of the   principal amount of the New Third Lien Notes, plus accrued and unpaid   interest to the redemption date.
    
	
 
    	
 
    	
 
    
	
Documentation
    	
 
    	
The documentation and covenants shall be reasonably   acceptable to the Issuers and the Required Consenting Unsecured Noteholders.


    The New Third Lien Notes will be subject to (i) the   Intercreditor Agreements (as defined in Exhibit 5)   and (ii) a security agreement and collateral documents with terms   substantially consistent with those governing the Amended Term Loan Credit   Agreement with such modifications as appropriate for notes and lien priority,   which documents, in each case of (i) and (ii) shall be reasonably   acceptable to the Required Consenting Unsecured Noteholders.
    


 











 

	
 
    	
 
    	
In order to receive the New Third Lien Notes, a holder must   first deliver a joinder to the Transaction Support Agreement duly executed by   such holder in substantially the form attached as Exhibit B   thereto.
    
	
 
    	
 
    	
 
    
	
Conditions Precedent
    	
 
    	
The closing of the New Third Lien Notes will be   subject to appropriate and customary conditions for facilities and   transactions of this type.
    
	
 
    	
 
    	
 
    
	
Covenants
    	
 
    	
Negative and affirmative covenants substantially similar to the   covenants under the New Second Lien Notes Indenture, with appropriate   adjustments for lien priority, in form and substance mutually acceptable to   the Issuers and the Required Consenting Unsecured Noteholders.

 

The New Third Lien Notes Indenture will not permit unlimited   debt secured by pari passu liens.
    
	
 
    	
 
    	
 
    
	
MT Guarantor Entities Covenants
    	
 
    	
The New Third Lien Notes Indenture shall require the MT   Guarantor Entities to comply with and to cause their subsidiaries to comply   with the covenants set forth in the MyTheresa Issuer Preferred Equity Term   Sheet, holders of the New Third Lien Notes will be provided information with   respect to the MT Entities as set forth in Annex B,   and shall prohibit MT Issuer from issuing any equity that is junior to the   Series A Preferred Stock (as defined in Exhibit 4)   other than common stock.

 

On or before September 30, 2019 MT Holdco shall   be permitted to reorganize the ownership structure of MT Issuer and its   subsidiaries to eliminate Mariposa Luxembourg I S.à r.l., and Mariposa   Luxembourg II S.à r.l. provided that all equity pledges and guarantees by the   MT Guarantor Entities shall remain or be assumed by operation of law or   otherwise in connection with such restructuring and without the creation of   any additional tax liabilities at the time of the restructuring to the   holders of the Series A Preferred Stock or to the holders of New Second   Lien Notes and New Third Lien Notes.


   The above covenants will be contained in a customary pledge agreement   relating to the MT Common Equity pledged to secure the New Third Lien   Obligations, to which MT Holdco will be a party.
    
	
 
    	
 
    	
 
    
	
Amendments to Indentures
    	
 
    	
The following proposed amendments (the “Proposed   Amendments”) to the Indentures will eliminate the following restrictive   covenants:
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
Section 3.2
    	
Reports and Other Information
    
	
 
    	
 
    	
 
    	
Section 3.3
    	
Limitation on Incurrence of Indebtedness and   Issuance of Disqualified Stock and Preferred Stock
    
	
 
    	
 
    	
 
    	
Section 3.4
    	
Limitation on Restricted Payments
    
	
 
    	
 
    	
 
    	
Section 3.5
    	
Liens
    
	
 
    	
 
    	
 
    	
Section 3.6
    	
Dividend and Other   Payment Restrictions Affecting Subsidiaries
    
	
 
    	
 
    	
 
    	
Section 3.7
    	
Asset Sales
    
	
 
    	
 
    	
 
    	
Section 3.8
    	
Transactions with   Affiliates
    
	
 
    	
 
    	
 
    	
Section 3.9
    	
Change of Control
    
	
 
    	
 
    	
 
    	
Section 3.10
    	
Maintenance of   Insurance
    
	
 
    	
 
    	
 
    	
Section 3.11
    	
Additional Guarantors
    
	
 
    	
 
    	
 
    	
Section 3.12
    	
Compliance Certificate;   Statement by Officers as to Default
    
	
 
    	
 
    	
 
    	
Section 3.13
    	
Designation of   Restricted and Unrestricted Subsidiaries
    


 











 

	
 
    	
 
    	
 
    	
Section 3.15
    	
Stay, Extension and   Usury Laws
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
The Proposed Amendments will also include (but will   not be limited to) the following:
    
	
 
    	
(i)            Addition of the LLC   Co-Issuer and the New Co-Issuer Subsidiary as co-issuers such that the   remaining Cash Pay Notes and PIK Toggle Notes shall be joint and several   primary obligations of each of the Issuers of the New Second Lien Notes;
    
	
 
    	
(ii)           Provisions giving   effect to the provisions under “Release Ratification” in the Recapitalization   Term Sheet;
    
	
 
    	
(iii)          Elimination of   Articles IV and X of the Indentures, in their entirety;
    
	
 
    	
(iv)          Elimination of clauses   (c), (d), (e), (f), (g) and (h) of Section 6.1 the Indentures;   and
    
	
 
    	
(v)           Related changes to   the definitions in connection with the foregoing.
    
	
 
    	
 
    	
 
    
	
Registration Rights
    	
 
    	
The New Third Lien Notes have not been and will not   be registered under the Securities Act or any state or other securities laws   and may not be offered or sold except pursuant to an exemption from, or in a   transaction not subject to, the registration requirements of the Securities   Act.
    
	
 
    	
 
    	
 
    
	
Transfer Restrictions
    	
 
    	
The New Third Lien Notes will be freely   transferable, subject to restrictions (i) pursuant to federal and state   securities laws (including that such New Third Lien Notes shall only be transferable   to “qualified institutional buyers” within the meaning of Rule 144A   promulgated under the Securities Act), and (ii) designed to prevent the   occurrence of circumstances that would reasonably be expected to require   registration or qualification of such New Third Lien Notes pursuant to   federal or state securities laws, or require the Issuers to file reports   pursuant to any applicable federal or state securities laws.
    
	
 
    	
 
    	
 
    
	
Public Market
    	
 
    	
None.
    
	
 
    	
 
    	
 
    
	
Book-Entry Form
    	
 
    	
The New Third Lien Notes will be represented by one   or more global notes in definitive, fully registered form deposited with a   custodian for, and registered in the name of, a nominee of DTC.
    
	
 
    	
 
    	
 
    
	
Events of Default
    	
 
    	
Substantially the same as in the New Second Lien Notes   Indenture.
    Notwithstanding anything to the contrary contained herein or in   the Agreement or otherwise, all existing Defaults or Events of Default (if   any) shall be permanently waived on the Effective Date, effective as of the   first date any such Default or Event of Default exists or existed.
    
	
 
    	
 
    	
 
    
	
Trustee
    	
 
    	
To be appointed by the Required Consenting Unsecured   Noteholders and reasonably acceptable to the Company.
    
	
 
    	
 
    	
 
    
	
Collateral Agent
    	
 
    	
To be appointed by the Required Consenting Unsecured   Noteholders and reasonably acceptable to the Company.
    
	
 
    	
 
    	
 
    
	
Ratings
    	
 
    	
The Issuers shall use their commercially reasonable   efforts to cause, within 60 days after the fiscal quarter in which the New   Third Lien Notes are issued, the New Third Lien Notes to receive a rating   from Standard & Poor’s, a division of The McGraw-Hill   Companies, Inc., or Moody’s Investors Service, Inc., or, if 
    


 











 

	
 
    	
 
    	
during such time neither of such institutions shall   be rating such obligations, an equivalent rating from another nationally   recognized statistical rating agency.
    
	
 
    	
 
    	
 
    
	
Governing Law and Forum
    	
 
    	
New York.
    


 












 

EXECUTION VERSION

 

EXHIBIT 4

 

MyTheresa Issuer Preferred Equity Term Sheet

 

The following summarizes the principal terms of the MT Preferred Equity.(1)

 

	
Aggregate Face Amount
    	
 
    	
$250 million in aggregate face amount of   non-convertible preferred equity shall be issued to the exchanging Unsecured   Noteholders (the “Series A Preferred Stock”) and $250 million in   aggregate face amount of non-convertible preferred equity shall be issued to   the direct parent of the MT Issuer (as defined below) (the “Series B   Preferred Stock” and, together with the Series A Preferred Stock,   the “MT Preferred Equity”).
    
	
 
    	
 
    	
 
    
	
Purchase Price
    	
 
    	
$1,000 per share (the “Original Purchase Price”),   to be issued at par.
    
	
 
    	
 
    	
 
    
	
Issuer
    	
 
    	
MT Issuer Co., a newly formed Delaware corporation   (together with its successors, the “MT Issuer”) and a direct   wholly-owned subsidiary of MyTheresa Holding Co., a newly formed Delaware   corporation (together with its successors, “MT Holdco”) which will be   a direct wholly-owned subsidiary of Neiman Marcus Group, Inc. MT Issuer   will be the direct parent of MyTheresa Intermediate Holding Co., a newly   formed Delaware corporation (together with is successors “MT Intermediate   Holdco”), which will be the direct parent of Mariposa Luxembourg I S.à   r.l.
    
	
 
    	
 
    	
 
    
	
Ranking
    	
 
    	
The Series A Preferred Stock will rank senior   to all other equity securities of the MT Issuer with respect to dividend   rights, distributions and payment rights, including upon liquidation, winding-up   and dissolution.
    
	
 
    	
 
    	
 
    
	
Term
    	
 
    	
The tenth anniversary of the Exchange Offer   Consummation Date (the “Maturity Date”), unless redeemed as set forth   in “Redemption” below. The MT Issuer will not be required to redeem   the Series A Preferred Stock except as set forth in “Redemption” below.
    
	
 
    	
 
    	
 
    
	
Dividends
    	
 
    	
Holders of the Series A Preferred Stock and   Series B Preferred Stock are entitled to cumulative cash dividends at   the rate of 10% per annum, compounded semi-annually, when, as and if declared   by the board of directors of MT Issuer (the “Board”) out of funds   legally available therefor. The entitlement to the cumulative cash dividends   by Series B Preferred Stock shall cease on the day that the   Series A Preferred Stock is redeemed in full in cash at a redemption   price equal to the Preferred Equity Payout, and no further dividends shall be   due and payable except for the dividends that accrued on or before that day.   To the extent not declared, such dividends shall be added to the Preferred   Equity Payout.

 

Notwithstanding the foregoing, the holder of   Series B Preferred Stock is intended to receive no more than the amount   described in clause (iii) of “Distributions Upon   Realizations of Value” below with respect to the Series B   Preferred Stock, and the entitlement to the cumulative cash dividends by   Series B Preferred Stock shall cease when and to the extent required to   achieve this result.
    


 




(1)   Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to such terms in the Transaction Support Agreement, dated as of March 25, 2019 (including the Recapitalization Term Sheet and the exhibits thereto) (the “Agreement”).

 











 

	
Distributions Upon Realizations of Value
    	
 
    	
Distributions of cash or any other MT Assets by MT   Issuer will be made in accordance with the following priorities:

 

(i)                                     the first $200   million of distributions would be irrevocably deposited into the MT Account,   to the extent required by the indenture governing the New Second Lien Notes;   provided, that upon the earlier to occur of (1) the satisfaction and   discharge in full of the obligations under the New Second Lien Notes and   (2) provision of MT Alternate Security, any amounts in the MT Account   shall be released and distributed in accordance with clauses (ii),   (iii) and (iv) below;

 

(ii)                                  thereafter, holders   of Series A Preferred Stock would receive distributions on a pro rata   basis up to an amount in respect of each share of MT Preferred Equity equal   to (a) the Original Purchase Price, as adjusted to account for equity   splits, combinations, recapitalizations or similar events, plus (b) all accumulated and unpaid dividends   (whether or not declared) through the date of payment plus (c) all   unpaid Default Return (as defined below) (such amount in the aggregate, the “Preferred   Equity Payout”);

 

(iii)                               thereafter, the holder   of Series B Preferred Stock would receive distributions up to an amount   equal to the Preferred Equity Payout received by the holders of Series A   Preferred Stock in the foregoing clause (ii) (excluding any Default   Returns); and

 

(iv)                              thereafter,   (x) holders of the MT Issuer common equity would receive 50% of any   remaining distributions on a pro rata basis and (y) the other 50% of any   remaining distributions shall be used to redeem the New Third Lien Notes at   par.
    
	
 
    	
 
    	
 
    
	
Redemption
    	
 
    	
The MT Issuer may redeem the Series A Preferred   Stock and Series B Preferred Stock at its option, in whole at any time   or in part from time to time, at a redemption price equal to the Preferred   Equity Payout (provided that no redemption payments on shares of   Series B Preferred Stock may be made unless (i) either (x) the   obligations under the New Second Lien Notes are satisfied and discharged in   full, (y) MT Alternate Security has been provided, or (z) the required   deposits to the MT Account have been made or otherwise satisfied and   (ii) the Preferred Equity Payout has been paid in full to the holders of   the Series A Preferred Stock either by redemption or by distribution).

 

All proceeds from any MT Secondary Sale shall   promptly be deposited into the MT Account or distributed by MT Issuer in the   manner set forth in “Distributions Upon   Realizations of Value” above (and, as a condition to the   consummation of any such MT Secondary Sale, the applicable equityholder(s) shall   cause the purchaser(s) to fund such proceeds directly to MT Issuer for   deposit into the MT Account or distribution in the manner set forth in “Distributions Upon Realizations of Value” above) (the “Cash   Sweep”).

 

Upon the earlier of the Maturity Date or a change of   control (including any change of control as a result of or following an   initial public offering) (a “Mandatory Redemption”) shall   (i) comply with clause (i) of “Distributions Upon   Realizations of Value” above and (ii) redeem all of the Series A   Preferred Stock in cash at a redemption price equal to the Preferred Equity
    


 











 

	
 
    	
 
    	
Payout. Upon any failure to redeem upon the   Mandatory Redemption or in accordance with the Cash Sweep provisions above,   and without limiting any rights the holders of Series A Preferred Stock   may have hereunder, the holders of Series A Preferred Stock may pursue   against the MT Issuer any available legal or equitable remedies for the   enforcement of claims in a legal or other proceeding to collect payment of   the Preferred Equity Payout in respect of the Series A Preferred Stock   or otherwise enforce their rights upon the occurrence of such default.
    
	
 
    	
 
    	
 
    
	
Covenants
    	
 
    	
The holders of the Series A Preferred Stock   will have no voting rights, except as required by a non-waivable provision of   law, or as described below.

 

Series B Covenants:

 

The Series B Preferred Stock shall not contain   any restrictive covenants, except that the consent of the holders of a   majority of the outstanding shares of Series B Preferred Stock shall be   required for any amendment to the MT Issuer’s constituent documents that is   disproportionately adverse to holders of the Series B Preferred Stock   (relative to the holders of Series A Preferred Stock).



Series A Covenants:

 

For the benefit of the holders of the Series A   Preferred Stock, the MT Guarantor Entities will not and will cause their   subsidiaries to not (whether by merger, consolidation, amendment,   recapitalization or otherwise):

 

(a)         declare or issue   dividends or other distributions in respect of, or purchase, repurchase or   otherwise retire for value, any MT Issuer equity except (i) in   accordance with the distribution waterfall set forth under “Distributions Upon Realizations of Value” or (ii) as   permitted under clause (h) below;

 

(b)         incur or guarantee   indebtedness for borrowed money other than:



(i)             revolving   (not term) indebtedness under the existing revolving credit facility of one   or more of the MT Operating Entities (as defined in “Reports”   below) (which shall be provided by one or more commercial banks) to finance   ordinary course working capital needs or capital expenditures and investments   permitted by clause (i) below, as it may be amended or refinanced from   time to time (the “MyTheresa RCF”), provided the aggregate principal   amount of indebtedness and letters of credit outstanding under any MyTheresa   RCF shall not exceed the greater of (x) 40 million Euros and   (y) 12.5% of the revenues of the MT Operating Entities (such amount in   (y) the “MyTheresa RCF Revenue Cap”) during the immediately   preceding twelve months; provided that, the MT Operating Entities may from   time to time borrow under the MyTheresa RCF to fund purchases of inventory   pursuant to a Projected Purchase Order up to an amount so that the amount of   indebtedness and letters of credit outstanding under the MyTheresa RCF at any   time does not exceed the Projected RCF Amount under the MyTheresa RCF,   notwithstanding that such borrowings would cause the amount outstanding under   the MyTheresa RCF to exceed the MyTheresa RCF Revenue Cap, so long as   (1) the MyTheresa RCF permits such borrowings and (2) the Projected   RCF Amount at the time of such
    


 











 

	
 
    	
 
    	
Projected Purchase   Order exceeded 40 million Euros; and

 

(ii)          trade debt in the   ordinary course;

 

“Projected Purchase   Order” means an advance order (which may not be made more than nine   months in advance of the earlier of (x) the date of delivery and   (y) the date of payment) for inventory made in the ordinary course of   business of the MT Operating Entities.



“Projected RCF   Amount” means an amount equal to the MyTheresa RCF Revenue Cap,   calculated as of the date of any Projected Purchase Order.



(c)          incur any liens (other   than liens securing the MyTheresa RCF, together with other   customary permitted liens to be agreed);

 

(d)         make any restricted   payments except (i) in accordance with the distribution waterfall set   forth under “Distributions Upon Realizations of Value”   or (ii) as permitted under clause (h) below;

 

(e)          issue equity that is   senior or pari passu to the Series A Preferred Stock or equity of   subsidiaries (other than issuances to MT Issuer or its subsidiaries   (together, the “MT Group”)), or amend or reclassify any equity of the   MT Issuer into any of the foregoing;

 

(f)           take any action,   including forming a subsidiary, recapitalization or reorganization, that   results in any entity being between MT Issuer and NMG Germany GmbH (other   than entities that are directly or indirectly wholly owned by MT Issuer);

 

(g)          liquidate, dissolve or   wind-up, or voluntarily petition for bankruptcy or fail to defend involuntary   acts of bankruptcy, subject to duties under applicable German law;

 

(h)         except for reasonable,   customary and arm’s length payments to or arrangements with affiliates   relating to allocation of shared expenses, enter into affiliate transactions   between Neiman Marcus Group, Inc. and any affiliates of Neiman Marcus   Group, Inc., or any other affiliates of the MT Issuer (other than the MT   Group) and the MT Group (including intercompany loans);

 

(i)             make any purchase   of equity, loan, extension of credit, guarantee, advance, capital   contribution or other acquisition for consideration of indebtedness, equity   interests or other securities (each, an “investment”), other than   investments made using common equity or the net cash proceeds of common   equity of MT Issuer (it being understood that an amount of net cash proceeds   of such common equity may be used to temporarily reduce the outstanding   amount under the MyTheresa RCF, and such amount may   be borrowed under the MyTheresa RCF to fund such   investments, together with other customary or ordinary course permitted   investments, including a general permitted investment basket of $10 million,   which shall not be used for liability management or related purposes);

 

(j)            engage in any   business or business activity other than that currently conducted by the MT   Group and any similar, corollary, related, ancillary, incidental or   complementary business or business activities or a reasonable
    


 











 

	
 
    	
 
    	
extension, development   or expansion thereof or ancillary thereto (it being understood that that the   MT Group may not acquire any securities or other interests in the Neiman   Marcus Group, Inc. or its affiliates);

 

(k)         (i) amend, alter   or repeal any provision of the governing documents of MT Issuer or   (ii) amend any rights specifically granted herein to holders of   Series A Preferred Stock, in each case in a manner that is   disproportionately adverse to the holders of Series A Preferred Stock   without their consent; or

 

(m)     amend, alter or repeal any   of the provisions described above under “Distributions upon   Realizations of Value” or “Redemptions”   in a manner adverse to the holders of Series A Preferred Stock.

 

Holders of the Series A Preferred Stock shall   receive subsequent notice of any (a) junior equity issuances by the MT   Issuer, (b) permitted debt issuances (other than in the ordinary course   of business) and (c) permitted investments, along with any information   reasonably requested to confirm that the MT Group is in compliance with the   covenants set forth herein.

 

In addition, MT Holdco, MT Issuer and MT   Intermediate Holdco will be subject to customary non-circumvention covenants,   including that the business of the MT Issuer and its subsidiaries will be   conducted directly or indirectly through the MT Issuer, and a covenant that   MT Holdco will have no operations other than holding the equity of MT Issuer   (including that MT Holdco will not incur any debt, liens, or other   liabilities other than liabilities resulting from its ownership of the equity   interests of MT Issuer).

 

The Series A Preferred Stock owned by MT   Holdco, MT Issuer, any of their subsidiaries or any of their affiliates shall   be disregarded for purposes of voting.

 

As provided for in the New Second Lien Notes Term   Sheet and in the New Third Lien Notes Term Sheet, on or before   September 30, 2019 MT Issuer shall be permitted to reorganize the   ownership structure of MT Issuer and its subsidiaries to eliminate Mariposa   Luxembourg I S.à r.l. and Mariposa Luxembourg   II S.à r.l.
    
	
 
    	
 
    	
 
    
	
Reports
    	
 
    	
Holders of the Series A Preferred Stock shall   be entitled to receive the following reports with respect to the business and   operations of NMG Germany GmbH and its operating subsidiaries (the “MT   Operating Entities”):

 

(a)         Quarterly and annual financial statements   presented in accordance with German GAAP with qualitative or quantitative   explanations of material applicable differences between U.S. and German GAAP;   and

 

(b)         On a quarterly and annual basis, a narrative   discussion of the key financial information of the MT Operating Entities   consistent with a customary earnings press release.

 

All financial reports shall be in English and shall   be provided substantially concurrently with when Neiman Marcus Group LTD LLC   provides public disclosures with respect to the corresponding quarter or year   end. MT Issuer shall establish and maintain such information on an   information portal, which shall be made available to the holders and any   prospective transferee(s) of Series A Preferred Stock thereof.
    


 











 

	
 
    	
 
    	
Information provided under New Second Lien Notes and   New Third Lien Notes reporting shall include, at a minimum, (i) the   narrative discussion referenced in (c) above and (ii) a summary   discussion of the key financial metrics of the MT Operating Entities on the   quarterly earnings calls of Neiman Marcus Group LTD LLC.
    
	
 
    	
 
    	
 
    
	
Default Remedies
    	
 
    	
In addition to any legal or equitable remedy the   holders of the Series A Preferred Stock may have for the enforcement of   claims in a legal or other proceeding to collect payment of the Preferred   Equity Payout or otherwise enforce its rights upon a breach of the covenants   set forth herein, the MT Issuer shall be required to pay an additional   dividend of 2% per annum, compounded quarterly, on the Series A   Preferred Stock from the date of such breach until such breach has been cured   (the “Default Return”), which Default Return shall either be declared   and paid in cash or added to the Preferred Equity Payout in the manner   described in “Dividends”.
    
	
 
    	
 
    	
 
    
	
Registration Rights
    	
 
    	
The Series A Preferred Stock has not been and   will not be registered under the Securities Act or any state or other   securities laws and may not be offered or sold except pursuant to an   exemption from, or in a transaction not subject to, the registration   requirements of the Securities Act.
    
	
 
    	
 
    	
 
    
	
Transfer Restrictions
    	
 
    	
The MT Preferred Equity will be freely transferable,   subject to restrictions (i) pursuant to federal and state securities   laws, (ii) designed to prevent the occurrence of circumstances that   would reasonably be expected to require registration or qualification of such   MT Preferred Equity pursuant to federal or state securities laws, or require   the MT Issuer to file reports pursuant to any applicable federal or state   securities laws, (iii) on transfers that would subject the MT Issuer to   regulation under the Investment Company Act of 1940, the Investment Advisors   Act of 1940 or the U.S. Employee Retirement Income Security Act of 1974, each   as amended, and (iv) on transfers to a person or entity other than a   Permitted Assignee.

 

A “Permitted Assignee” shall mean, prior to a Change   of Control, any person or entity other than (a) a specified competitor   of the Company Group(2), or (b) any person or entity specified on a   “disqualified institutions” list provided by the Company Group to the Term   Loan Agent at closing pursuant to the Amended Term Loan Credit Agreement.
    
	
 
    	
 
    	
 
    
	
Tax Treatment
    	
 
    	
MT Issuer and the holders of the Series A   Preferred Stock agree that (i) the Series A Preferred Stock is   intended to constitute (x) equity for U.S. federal income (and   applicable state and local) tax purposes, and (y) preferred stock   described in Section 1504(a)(4) of the U.S. Internal Revenue Code   of 1986, as amended (the “Code”), (ii) any increase to the   Preferred Equity Payout as a result of undeclared dividends is not intended   to be treated as a distribution pursuant to Section 301 or   Section 305 of the Code or otherwise treated as a distribution that is   subject to U.S. federal tax withholding, and (iii) upon (x) any   complete redemption of the Series A Preferred Stock and (y) any   other redemption of the Series A Preferred Stock that is, in the case a   redemption described in this clause (y), held or beneficially owned by a   holder that does not own (including indirectly) an amount of any other class   of stock of the MT Issuer that would cause such redemption to be subject to   U.S. federal tax
    


 




(2)  Note to Draft:  To include specified list of competitors (to be provided), their affiliates and controlling parties and specified list of sponsors.

 











 

	
 
    	
 
    	
withholding by virtue of not being treated as a sale   or exchange pursuant Section 302(b) of the Code, the Preferred   Equity Payout is intended to be treated in its entirety as a payment in exchange   for the Series A Preferred Equity that is not subject to U.S. federal   tax withholding, and not as a distribution pursuant to Section 301 or   Section 305 of the Code or otherwise (and in any other case, the   covenant in the final sentence of this section shall still apply). MT   Issuer and the holders of the Series A Preferred Stock shall prepare all   U.S. federal income and U.S. federal income withholding tax returns and tax   filings consistent with such intent unless otherwise required by a final   determination by an applicable taxing authority or a change in applicable law   or administrative guidance.  If the MT Issuer (or any other withholding   agent, but solely in the event that the MT Issuer is not the withholding   agent but has determined that such withholding is required) is required to   deduct or withhold any U.S. federal withholding taxes from (i) the   Preferred Equity Payout as a result of a change in applicable law or   administrative guidance or (ii) from any current dividends that are declared   by the Board and paid in cash, the Preferred Equity Payout or such cash   dividend, as applicable, shall be increased as necessary so that after such   deduction or withholding has been made (including such U.S. federal   withholding deductions and withholdings applicable to such increase in the   Preferred Equity Payout or cash dividend, as applicable) each direct or   indirect holder of the Series A Preferred Stock receives an amount equal   to the sum it would have received had no such deduction or withholding been made.   The MT Issuer will otherwise use its commercially reasonable efforts to   cooperate with holders to minimize U.S. federal tax withholding related to   the Series A Preferred Stock (including in the case of any partial   redemption of the Series A Preferred Stock, in determining whether a   holder of Series A Preferred Stock owns (including indirectly) an amount   of any other class of stock of the MT Issuer described in   clause (iii)(y), above).
    
	
 
    	
 
    	
 
    
	
Public Market
    	
 
    	
None.
    
	
 
    	
 
    	
 
    
	
Book-Entry Form
    	
 
    	
The MT Preferred Equity will be DTC eligible. MT   Issuer shall receive notice of any proposed transfer, and transfers in   violation of “Transfer Restrictions” above will be void ab initio.
    
	
 
    	
 
    	
 
    
	
Governing Law and Forum
    	
 
    	
New York.
    


 












 

EXHIBIT 5

 

Amended Term Loan Term Sheet

 

The following summarizes the principal terms of the Extended Term Loans, the Amendment and Extension and the Paydowns.(1)  As used herein, the “Existing Term Loan Credit Agreement” shall mean the Term Loan Credit Agreement as in effect immediately prior to the Effective Date, and the “Amended Term Loan Credit Agreement” shall mean the Term Loan Credit Agreement after giving effect to the Amendment and Extension on the Effective Date.

 

	
Co-Borrowers
    	
 
    	
With respect to the Extended Term Loans and the   Initial Loans, Neiman Marcus Group LTD LLC, a Delaware limited liability   company, (“NMG LTD LLC” or the “Borrower”), The Neiman Marcus   Group LLC, a Delaware limited liability company (“NMG LLC”)   and one of NMG LLC’s direct wholly-owned subsidiaries (to be determined by   Borrower; provided, that such subsidiary shall be either (x) an   entity treated as disregarded as separate from the Borrower for U.S. federal   income tax purposes or (y) an entity holding no material assets) shall   be co-borrowers (such entities, each a “Co-Borrower”   and collectively, the “Co-Borrowers”).
    
	
 
    	
 
    	
 
    
	
Administrative Agent and Collateral Agent
    	
 
    	
Credit Suisse AG, Cayman Islands Branch
    
	
 
    	
 
    	
 
    
	
Amendment and Extension
    	
 
    	
On the Effective Date, immediately prior to the   Initial Paydown, Consenting Term Loan Lenders, each other Lender electing to   receive Extended Term Loans (together with the Consenting Term Loan Lenders,   the “Participating Term Loan Lenders”;   and all other Lenders which are not Participating Term Loan Lenders as of the   Effective Date immediately prior to the consummation of the Amendment and   Extension, the “Non-Participating Term   Loan Lenders”), and each Company Party shall amend the   Existing Term Loan Credit Agreement and the other applicable Loan Documents,   and shall enter into such other definitive documents, as are necessary and   appropriate to provide for three (3) tranches of term loans:

 

(i) Term Loans   held by Non-Participating Term Loan Lenders, which are not subject to the   maturity extension contemplated in this Amended Term Loan Term Sheet but   which shall be subject to the applicable amendments set forth in this Amended   Term Loan Term Sheet (the “Initial Loans”),

 

(ii) extended term   loans held by electing Participating Term Loan Lenders, which are subject to   interest at the rate described in clause (i) below of the “Interest”   section and the other terms set forth in this Amended Term Loan Term Sheet   (the “Cash Pay Extended Term Loans”),   and

 

(iii) extended   term loans held by electing Participating Term Loan Lenders, which are   subject to interest at the rate described in clause (ii) below of the   “Interest” section and the other terms set forth in this Amended Term Loan   Term Sheet (the “Cash Pay/PIK Extended   Term Loans” and together with the Cash Pay Extended Term   Loans, each an “Extended Term Loan”   and collectively, the “Extended Term Loans”).

 

At the option of the Borrower (with the consent of   the Required Consenting Term Loan Lenders), the Cash Pay Extended Term Loans   and the Cash Pay/PIK 
    


 




(1)         Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to such terms in the Transaction Support Agreement (including the Recapitalization Term Sheet and the exhibits thereto) (the “Agreement”) or the Existing Term Loan Credit Agreement (as defined herein), as applicable.

 











 

	
 
    	
 
    	
Extended Term Loans (i) may constitute new   Classes of Term Loans (but with respect to each other shall not constitute   separate Classes for purposes of Section 2.15 of the Amended Term Loan   Credit Agreement or any analogous pro rata sharing   provisions) under the Amended Term Loan Credit Agreement, or (ii) may be   issued pursuant to a new credit agreement.

 

Such amendments and definitive documents shall   further provide that on the Effective Date, immediately prior to the Initial   Paydown:



(x) Participating   Term Loan Lenders who so elect shall exchange all or any portion of their   Term Loans for Cash Pay Extended Term Loans at par;

 

(y) Participating   Term Loan Lenders who so elect shall exchange all or any portion of their   Term Loans for Cash Pay/PIK Extended Term Loans at par; and

 

(z) all accrued   and unpaid interest on the principal amount of Term Loans that are exchanged   into Extended Term Loans pursuant to clauses (x) and (y) above   shall be paid in cash on the Effective Date.

 

Any such Term Loans held by Participating Term Loan   Lenders which are exchanged for any Extended Term Loan on the Effective Date   shall not, in any event, be subject to any LIBOR breakage costs which would   have otherwise been incurred under the terms of the Existing Term Loan Credit   Agreement or otherwise.

 

Each such tranche of Extended Term Loans shall be   subject to minimum aggregate principal amounts of $500.0 million (or such   other amount as mutually agreed by the parties). For the avoidance of doubt,   Participating Term Loan Lenders may elect, at the closing of the   Recapitalization Transactions, to receive, on account of their Term Loans,   either Cash Pay Extended Term Loans, Cash Pay/PIK Extended Term Loans, or a   combination of Cash Pay Extended Term Loans and Cash Pay/PIK Extended Term   Loans. To the extent that, after giving effect to any voluntary reallocations   mutually agreed between any of the Consenting Term Loan Lenders, one tranche   of Extended Term Loans is under-subscribed with less than $500.0 million   aggregate principal amount of Loans in such tranche, Consenting Term Loan   Lenders electing to receive the other tranche of Extended Term Loans shall be   deemed, on a pro rata basis, to have   adjusted such elections such that there is at least $500.0 million aggregate   principal amount of each tranche of Extended Term Loans; provided, however,   if Participating Term Loan Lenders elect to receive, in aggregate, less than   $250 million of either Class of Extended Term Loans, then such   Class shall be eliminated and all Extended Term Loans shall be loans of   the other Class.
    
	
 
    	
 
    	
 
    
	
Paydown
    	
 
    	
Immediately following the consummation of the   Amendment and Extension as set forth above, the Co-Borrowers shall prepay,   subject to the Waived Term Loan Paydown described below, on a pro rata basis, at par, $550.0 million (the “Initial Paydown Amount”) aggregate   principal amount of Extended Term Loans (such initial paydown of term loans   on the Effective Date, the “Initial Paydown”,   and together with any Additional Paydown (as defined below), each a “Paydown” and collectively, the “Paydowns”), together with accrued   and unpaid interest thereon through (but not including) the date of such   Paydown, such that each Lender holding Extended Term Loans shall receive an   amount equal to its ratable share of the Initial Paydown Amount. Such Initial   Paydown shall be funded by the net cash proceeds received by the Co-Borrowers   (or any of their affiliates) from the issuance of New Second Lien Notes, cash   on hand of the Loan Parties or any of their 
    


 

2











 

	
 
    	
 
    	
subsidiaries, or other sources of funds. Except in   the case of the Waiving Term Loan Lenders (as defined below), the amount of   the Initial Paydown Amount received by each Participating Term Loan Lender   shall be equal to (i) such Participating Term Loan Lender’s pro rata share of $550.0 million assuming that each Lender   is a Participating Term Loan Lender (i.e., calculated as a pro rata share of the aggregate principal amount of   outstanding Extended Term Loans assuming that each Lender is a Participating   Term Loan Lender) plus (ii) such Participating Term Loan Lender’s   pro rata share (as among all   Participating Term Loan Lenders) of the Remaining Waived Paydown Amount (as   defined below).

 

A subset of the Consenting Term Loan Lenders, on   behalf of themselves and their successors and assigns (such Consenting Term   Loan Lenders, together with such successors and assigns, the “Waiving Term Loan Lenders”), have   agreed to collectively waive the Initial Paydown in an aggregate principal   amount equal to $25.0 million in total for all Waiving Term Loan Lenders (the   “Waived Term Loan Paydown”), such   that the net principal amount of the Initial Paydown prior to the application   of clauses (i) and (ii) below will be $525.0 million; provided that   the Waiving Term Loan Lenders shall be entitled to receive, equally and   ratably based on their waived amounts, additional Paydowns of Term Loans from   the amounts and in the order described in clauses (i) and   (ii) below in an aggregate amount not to exceed $25.0 million:

 

(i) first, the   Waived Paydown Amount (as defined below), in an amount not to exceed $25.0   million (such amount, the “Waived Paydown Catch-up   Amount”). The portion, if any, of the Initial Paydown Amount   that would have been applied to prepay the Extended Term Loans of Non-Participating   Term Loan Lenders had such Non-Participating Term Loan Lenders been   Participating Term Loan Lenders is referred to herein as the “Waived Paydown Amount”; the   portion of the Waived Paydown Amount, if any, in excess of $25.0 million is   referred to herein as the “Remaining Waived Paydown   Amount (for the avoidance of doubt, if there are no   Non-Participating Term Loan Lenders, then the Waiving Term Loan Lenders would   receive $0 pursuant this clause (i)); and

 

(ii) second, (if   the amount in clause (i) above is less than $25.0 million) an amount   equal to the difference, if any, between (A) the maximum amount of the   Noteholder Cash Joinder Payment (as defined in the Recapitalization Term   Sheet) payable pursuant to the Recapitalization Term Sheet and (B) the   amount of the Noteholder Cash Joinder Payment actually paid at the   consummation of the Recapitalization Transactions (for the avoidance of   doubt, if noteholders holding 100% of the Cash Pay Notes and 100% of the PIK   Toggle Notes elect to participate in the Recapitalization Transactions by   becoming Consenting Cash Pay Noteholders or Consenting PIK Toggle   Noteholders, then the Waiving Term Loan Lenders would receive $0 pursuant   this clause (ii)).

 

Any amounts described in clauses (i) or   (ii) above not required to be applied to the paydown of Term Loans held   by Waiving Term Loan Lenders pursuant to the foregoing proviso shall be,   (x) with respect to the amounts described in clause (i) above,   applied to prepay all Extended Term Loans on a pro rata basis   (as among all Participating Term Loan Lenders), and (y) with respect to   the amounts described in clause (ii) above, retained by the Loan Parties   or any of their respective subsidiaries. For the avoidance of doubt, the   Waiving Term Loan Lenders shall be entitled to their pro rata share   of the Remaining Waived Paydown Amount.
    


 

3











 

	
Maturity
    	
 
    	
The Extended Term Loans shall mature on the earlier   of (i) October 25, 2023 and (ii) July 16, 2021, if all of   the Unsecured Notes (and any indebtedness refinancing or replacing any   Unsecured Notes), other than Unsecured Notes and refinancing or replacement   Indebtedness in an aggregate principal amount not to exceed $150.0 million,   have not been (a) fully repaid or otherwise redeemed, discharged or   defeased or (b) extended so that the maturity date with respect thereto   is no earlier than April 24, 2024 (the earlier of such dates described   in the foregoing clauses (i) and (ii), the “Maturity   Date”).

 

For the avoidance of doubt, the maturity date of the   Initial Loans shall remain unchanged.
    
	
 
    	
 
    	
 
    
	
Amortization
    	
 
    	
The Extended Term Loans shall amortize at 1.50% per   annum, in equal quarterly installments of 0.375%, in each case, of the   aggregate principal amount of such Extended Term Loans as of the Effective   Date immediately after giving effect to the Initial Paydown, with the balance   payable on the Maturity Date. The first installment shall be due and payable   on the last Business Day of each fiscal quarter of Borrower commencing with   the first full fiscal quarter following the Effective Date.

 

For the avoidance of doubt, amortization on the   Initial Loans shall remain unchanged.
    
	
 
    	
 
    	
 
    
	
Interest
    	
 
    	
Interest on the Extended Term Loans shall accrue at:

 

(i) in the case of   Cash Pay Extended Term Loans, (a) the Adjusted LIBO Rate plus 6.00% per   annum payable in cash (subject to a 1.50% per annum floor on the Adjusted   LIBO Rate) or (b) ABR (subject to a 2.50% per annum floor on the ABR)   plus 5.00% per annum payable in cash; or

 

(ii) in the case   of Cash Pay/PIK Extended Term Loans, (a) the Adjusted LIBO Rate plus   5.50% per annum payable in cash (subject to a 1.50% per annum floor on the   Adjusted LIBO Rate) plus 1.00% per annum payable in kind or (b) ABR   (subject to a 2.50% per annum floor on the ABR) plus 4.50% per annum payable   in cash plus 1.00% per annum payable in kind.

 

Interest on the Extended Term Loans shall be payable   in arrears on each Interest Payment Date and on the applicable Maturity Date   (and with respect to any such interest that is paid in kind, added to the   then outstanding principal amount of the Cash Pay/PIK Extended Term Loans, as   applicable).

 

For the avoidance of doubt, the interest rate on the   Initial Loans shall remain unchanged.
    
	
 
    	
 
    	
 
    
	
Default Rate
    	
 
    	
Same as provided under the Existing Term Loan Credit   Agreement; provided, that if a payment or   bankruptcy Event of Default has occurred and is continuing, all Borrowings   shall automatically convert to ABR Borrowings with no notice or other action   required by the Administrative Agent or any Lender and no ABR election shall   be permitted during the pendency of any such Event of Default.
    
	
 
    	
 
    	
 
    
	
Security
    	
 
    	
The Extended Term Loans, guarantees thereof and   other obligations under the Definitive Documents related thereto shall be   secured by substantially all assets of the Loan Parties (including any person   that becomes a Loan Party on or after the Effective Date), including without   limitation all e-commerce intellectual property and all other intellectual   property, a pledge of the equity interests of New 
    


 

4











 

	
 
    	
 
    	
Subsidiary (as defined below) and PropCo (each as   defined below), the Term Priority Collateral, the ABL Priority Collateral,   the PropCo Assets (as defined in the New Second Lien Notes Term Sheet) and   the other real property interests set forth on Annex B hereto (such   real property interests set forth on Annex B, the “New Term Loan Priority Assets”),   subject, in each case, to exclusions consistent with the Agreement and this   Amended Term Loan Term Sheet and otherwise to be agreed by the Borrower and   the Required Consenting Term Loan Lenders(2) (the “Extended   Term Loan Collateral”).

 

For the avoidance of doubt, the Initial Loans shall   remain secured by the Collateral as of immediately prior to the Effective   Date but shall not be secured by the PropCo Assets, New Term Loan Priority   Assets, equity interests of any New Subsidiary or PropCo, any additional   assets constituting Extended Term Loan Collateral which were not part of the   Collateral prior to the Effective Date or any other property or assets of   Mariposa Intermediate, the Co-Borrowers or any of their respective   subsidiaries.
    
	
 
    	
 
    	
 
    
	
Guarantees
    	
 
    	
Same as provided under the Existing Term Loan Credit   Agreement; provided, that (x) all   domestic subsidiaries of Mariposa Intermediate or any of the Co-Borrowers   that are Restricted Subsidiaries as of the Effective Date (including New   Subsidiary and PropCo, if applicable) shall guarantee the Extended Term   Loans, and shall remain guarantors of the Extended Term Loans, whether or not   Wholly-Owned and (y) foreign subsidiaries of Mariposa Intermediate or   any of the Co-Borrowers formed or acquired after the Agreement Effective Date   shall become Guarantors to the extent provided in Annex A   hereto. Notwithstanding anything to the contrary contained herein,   (i) in the event that the MyTheresa Entities are required to be   contributed to the Loan Parties or their subsidiaries in accordance with any   settlement, judgment, court order or other resolution of a Claim, Cause of   Action or litigation with respect to the MyTheresa Transaction, such entities   shall be deemed “Unrestricted Subsidiaries” (as defined and treated under the   terms of the Existing Term Loan Credit Agreement) and (ii) any   guarantees of the Extended Term Loans provided by New Subsidiary or PropCo   shall be unsecured.

 

Subject to the “call right” described under   “Intercreditor Agreements” below, the guarantees of PropCo and New   Subsidiary, if any, shall be unsecured and subject to the following   priorities as to contractual right of payment:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
Guarantee of
   Extended Term
   Loan
    	
 
    	
Guarantee of New
   Second Lien Notes
    	
 
    	
Guarantee of New
   Third Lien Notes
    
	
 
    	
 
    	
Propco
    	
 
    	
Third
    	
 
    	
Second
    	
 
    	
First
    
	
 
    	
 
    	
New Subsidiary
    	
 
    	
First
    	
 
    	
Second
    	
 
    	
Third
    


 




(2)         “Excluded Assets” definition to be modified to reflect agreement regarding real property collateral, as well as to no longer include certain items to be mutually agreed by the Company Parties and the Required Consenting Term Loan Lenders, including without limitation intercompany indebtedness, interests in immaterial (subject to post-closing timing exceptions set forth in the covenant chart), unrestricted, foreign and other subsidiaries (provided that carveouts substantially similar to those set forth in clauses (1), (6), (7), (8) and (9) (provided the Administrative Agent will consult with the Lenders before making any determination) of the definition of “Excluded Equity Interests” in the Collateral Agreement (as defined in the Existing Term Loan Credit Agreement) and any provisions related thereto shall be included in the loan documents governing Extended Term Loans), and margin stock.  Administrative Agent discretion to agree to non-pledge of assets will be subject to prior consultation with the Lenders.  The New Term Loan Priority Assets will include the properties identified on Annex B hereto.

 

5












 

	
Ranking
    	
 
    	
The Extended Term   Loans, guarantees thereof and other obligations under the Definitive   Documents related thereto shall:

 

·                  be   secured by a first priority security interest on the Term Priority   Collateral, including the New Term Loan Priority Assets and/or, as   applicable, a first priority pledge of the equity interests in New   Subsidiary;

·                  be   secured by a second priority security interest on the ABL Priority   Collateral;

·                  be   secured by a third priority security interest on the PropCo Assets and, to   the extent any PropCo Assets are owned or otherwise held by a special purpose   vehicle formed to hold such PropCo Assets (such owner of PropCo Assets which   will be a subsidiary of NMG LLC, “PropCo”),   by a third priority security interest on (through a pledge of) the equity   interests of PropCo;

·                  be   effectively senior to all of the Co-Borrowers’ and the guarantors’ future   unsecured indebtedness, to the extent of the value of the collateral; and

·                  be   structurally junior to all liabilities of any of Mariposa Intermediate’s or   the Borrower’s subsidiaries that do not guarantee the Extended Term Loans.

 

The Initial Loans,   guarantees thereof and other obligations under the Definitive Documents related   thereto shall:

 

·                  be   secured by a fifth priority security interest (or, at Borrower’s option, a   higher priority security interest) on all Collateral that is Term Priority   Collateral as of the date immediately prior to the Effective Date;

·                  be   secured by a fifth priority security interest (or, at Borrower’s option, a   higher priority (up to second) security interest) on all Collateral that is   ABL Priority Collateral;

·                  not   be secured by the PropCo Assets or New Term Loan Priority Assets, the equity   interests of PropCo, the equity interests of New Subsidiary, or any other   property or assets of Mariposa Intermediate, the Co-Borrowers, or their   respective subsidiaries other than the Collateral;

·                  be   effectively senior to all unsecured indebtedness of the Co-Borrowers and the   guarantors of the Initial Loans, to the extent of the value of the collateral   securing the Initial Loans; and

·                  be   structurally junior to all liabilities of any of Mariposa Intermediate’s or   the Borrower’s subsidiaries that do not guarantee the Initial Loans.

 

Attached as Exhibit 6 to the   Recapitalization Term Sheet is a schematic of the collateral and priorities   of the security interests on certain assets granted to each lender, holder or   stakeholder of indebtedness or securities of the applicable Company Parties.   For the avoidance of doubt, the Amended Term Loan Credit Agreement and any   credit agreement governing the Extended Term Loans shall permit   (i) prior to any exercise of the “call right” described under   “Intercreditor Agreements” below, prepayments of the New Second Lien Notes   and New Third Lien Notes with the proceeds of any sale of the PropCo Assets   and equity interests of PropCo (if any), and (ii) prepayments of   obligations under the Revolving Credit Agreement.
    


 

6











 

	
New Subsidiary; PropCo; Nancy
    	
 
    	
It is the intention of   the parties that the PropCo Assets and the New Term Loan Priority Assets be   mortgaged by their existing owners in favor of the applicable creditors with   the priorities set forth herein and in the Agreement. To the extent any such   property may not be mortgaged in accordance with the lease or other contracts   governing it, or if parties to the Agreement sufficient to amend the   Agreement agree that the cost of mortgaging is excessive, then, in lieu of   mortgages: a) the applicable PropCo Assets will be contributed to PropCo, and   b) the applicable New Term Loan Priority Assets will be contributed to a new   special purpose vehicle that is a subsidiary of NMG LLC and formed solely to   hold such assets (such entity, the “New Subsidiary”).

 

New Subsidiary and   PropCo will be guarantors of the Extended Term Loans, the Second Lien Notes   and Third Lien Notes, subject to payment subordination agreements in a form   to be reasonably agreed in order to give the applicable creditors the   applicable priority (as if the assets of New Subsidiary and PropCo could have   been mortgaged) with respect to the value of the PropCo Assets and the New   Term Loan Priority Assets. The equity interests in New Subsidiary and PropCo   will be pledged as collateral for the Extended Term Loans, the Second Lien   Notes, the Third Lien Notes and other applicable indebtedness with the   priorities contemplated hereby and by the Agreement.

 

In the event New   Subsidiary and PropCo are formed, New Subsidiary and PropCo will each grant a   lease or license to the applicable subsidiary of Borrower (each such   subsidiary, an “NMG Sub”)   to operate on the relevant property on terms to be reasonably agreed. Nancy   Holdings LLC will be merged into NMG LLC and the intercompany lease   agreements between Nancy Holdings LLC and NMG LLC will be terminated, in each   case, within 90 days after the Effective Date (or such later date as mutually   agreed by the Company Parties and the Required Consenting Term Loan Lenders)   and, concurrently with such merger, the successor to Nancy Holdings LLC will   mortgage the real properties constituting collateral currently held by it in   accordance with the priorities set forth herein.
    
	
 
    	
 
    	
 
    
	
Intercreditor Agreements
    	
 
    	
The Extended Term Loans   shall be subject to one or more intercreditor agreements (collectively, the “Intercreditor Agreements”), to   which the Loan Parties shall be party, which shall (x) provide for the   relative lien priorities set forth above under the heading “Ranking”,   (y) be consistent with the terms set forth in the Agreement, and   (z) otherwise be mutually acceptable to the Borrower, the Required   Consenting Term Loan Lenders, the Required Consenting Unsecured Noteholders,   and the Required Lenders (as defined in the Revolving Credit Agreement). Such   Intercreditor Agreements shall provide that distributions received in respect   of any junior creditor’s secured claim on collateral as to which there is a   senior creditor on such collateral, regardless of source or form (including   without limitation and for the avoidance of doubt (i) any distribution   of such collateral or the proceeds thereof and (ii) direct or indirect   equity interests in and/or debt or equity investment rights in the loan   parties or their successors received in an insolvency proceeding), shall be   turned over to the senior creditors until such senior creditors have been   paid in full in cash (including any applicable Prepayment Premium) in respect   of their secured claim with respect to such collateral.

 

Upon the occurrence and   during the continuance of an event of default under any credit agreement   governing Extended Term Loans, any of the lenders holding Extended Term Loans   (or their representative) shall have a “call right” permitting such lenders   to fund the pay down of New Third Lien Notes (or, if less than $200 million   of New Third Lien Notes are then outstanding, New Second Lien Notes following   the pay down in full of the New Third Lien Notes), at par, in cash in an   amount equal to $200.0 million. Upon receipt by the trustee for the New Third   Lien
    


 

7











 

	
 
    	
 
    	
Notes or New Second   Lien Notes of such purchase price, (i) any liens on the PropCo Assets   and on the equity interests of PropCo (if any) securing the remaining   obligations in respect of New Third Lien Notes and New Second Lien Notes not   so purchased shall be subordinated to the liens on the PropCo Assets and   equity interests of PropCo securing the Extended Term Loans and (ii) the   amount so funded shall be treated for all purposes under the applicable loan   documents as additional Extended Term Loans (“Additional   Extended Term Loans”), secured ratably with all Extended Term   Loans by the then-existing collateral therefor and otherwise on terms   identical to the Extended Term Loans; provided, that the Additional Extended   Term Loans shall have a “first-out” right with respect to claims in respect   of the PropCo Assets and the equity interests of PropCo relative to the other   Extended Term Loans. Prior to the exercise of the “call right” described   above or the satisfaction of such $200.0 million secured claim of the holders   of New Third Lien Notes (or New Second Lien Notes, as applicable), the   secured claims of the holders of the New Third Lien Notes and the New Second   Lien Notes in respect of the PropCo Assets and the equity interests of PropCo   (if any) in any bankruptcy or other insolvency proceeding that are senior to   the secured claims of the lenders holding Extended Term Loans with respect to   the PropCo Assets and the equity interests of PropCo (if any) shall not   exceed $200.0 million (or, if less, the value of the PropCo Assets) in the   aggregate for all New Third Lien Notes and New Second Lien Notes, regardless of   the actual value of the PropCo Assets and the equity interests of PropCo (if   any). Upon the exercise of the “call right” described above or the   satisfaction of such $200.0 million secured claim of the holders of New Third   Lien Notes (or New Second Lien Notes, as applicable), the security interests   in the PropCo Assets and the equity interests of PropCo shall have the same   relative priorities as the security interests in New Term Loan Priority   Assets (as set forth on Exhibit 6).
    
	
 
    	
 
    	
 
    
	
Loan Documents
    	
 
    	
The loan documents   governing Extended Term Loans shall contain terms substantially similar to   the terms under the Existing Term Loan Credit Agreement and the other Loan   Documents (as defined in the Existing Term Loan Credit Agreement), with   modifications to reflect this term sheet, including the Annexes hereto, and   other adjustments satisfactory to the Borrower and the Required Consenting   Term Loan Lenders.
    
	
 
    	
 
    	
 
    
	
Voluntary Prepayments
    	
 
    	
Same as provided under   the Existing Term Loan Credit Agreement, subject to the Prepayment Premium   set forth below, except that:

 

·                  At   the Borrower’s election (with the prior written consent of lenders holding   more than 50.0% of the aggregate outstanding principal amount of Extended   Term Loans), at any time after the Effective Date, the Co-Borrowers may pay   down on a pro rata basis up to an additional   $250.0 million of the aggregate principal amount of Extended Term Loans (the   “Additional Paydown Amount” and   any such additional paydown, an “Additional Paydown”)   at par, together with accrued and unpaid interest thereon through (but not   including the date of such Paydown), with the net cash proceeds from any   applicable real estate monetization or financing transaction consummated   after the Effective Date.

 

·                  No   voluntary prepayments of Initial Loans other than (i) voluntary   prepayments made using cash proceeds received by Mariposa Intermediate from   common equity contributions to Mariposa Intermediate or from the issuance by   Mariposa Intermediate of common equity capital (including, for the avoidance   of doubt, cash proceeds received from the sale or disposition of any assets   which are contributed to Mariposa Intermediate) or (ii) with, or with   the proceeds from the issuance of, first-lien/second-out (or more junior)   loans 
    


 

8











 

	
 
    	
 
    	
as described in Annex A. Repayments of the   Initial Loans will also be subject to the “Covenant with respect to Holdouts”   set forth in Annex A.
    
	
 
    	
 
    	
 
    
	
Mandatory Prepayments
    	
 
    	
Same as provided under   the Existing Term Loan Credit Agreement, subject to the Prepayment Premium   set forth below, as applicable, except that reinvestment rights with respect   to proceeds from Asset Sales or Sale and Lease-Back Transactions (as set   forth in Section 2.08 of the Existing Term Loan Credit Agreement) shall   be modified in accordance with Annex A.
    
	
 
    	
 
    	
 
    
	
Prepayment Premium
    	
 
    	
Prepayments,   repurchases or redemptions of Extended Term Loans (other than mandatory   prepayments as a result of excess cash flow, casualty/condemnation events or   amortization payments or, for the avoidance of doubt, any Additional Paydown)   shall be subject to the payment of the prepayment premium as set forth below   (expressed as a percentage of the principal amount being prepaid, repurchase   or redeemed as set forth opposite the relevant period from the Effective Date   indicated below the “Prepayment Premium”),   plus accrued and unpaid interest to the prepayment date:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Prepayment Date
    	
 
    	
Prepayment Premium
    
	
 
    	
 
    	
After the Effective Date   and prior to the first anniversary of the Effective Date
    	
 
    	
Non-Callable subject to   a customary make-whole premium (using a discount rate of T+50)
    
	
 
    	
 
    	
On or after the first   anniversary of the Effective Date and prior to the second anniversary thereof
    	
 
    	
2.00%
    
	
 
    	
 
    	
On or after the second   anniversary of the Effective Date and prior to the third anniversary thereof
    	
 
    	
1.00%
    
	
 
    	
 
    	
On or after the third   anniversary of the Effective Date
    	
 
    	
0.00%
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
The Prepayment Premium   shall be, under the loan documents governing the Extended Term Loans,   expressly payable in respect of any repayment prior to scheduled maturity   (other than mandatory prepayments as a result of excess cash flow,   casualty/condemnation events or amortization payments, or, for the avoidance   of doubt, any Additional Paydown), including upon any acceleration of   maturity for any reason, whether by action of Lenders or the Agents or   automatic acceleration, including as a result of a bankruptcy filing.  Upon acceleration of the Extended Term   Loans for any reason, whether by action of Lenders or the Agents or automatic   acceleration, including as a result of a bankruptcy filing, the Prepayment   Premium shall be immediately due and payable.
    
	
 
    	
 
    	
 
    
	
Conditions Precedent
    	
 
    	
The closing of the Amended Term Loan Credit Agreement   shall be subject to appropriate and customary conditions for facilities and   transactions of this type, substantially similar to the applicable closing   conditions set forth in the Existing Term Loan Credit Agreement, as modified   for the Recapitalization Transactions.
    
	
 
    	
 
    	
 
    
	
Representations and Warranties
    	
 
    	
Substantially similar to those provided under the   Existing Term Loan Credit Agreement, with reasonable modifications, mutually   acceptable to the Borrower and the Required Consenting Term Loan Lenders in   light of the Recapitalization Transactions.
    
	
 
    	
 
    	
 
    
	
Covenants and Other 
    	
 
    	
Substantially similar to the Existing Term Loan   Credit Agreement, subject to (x) the modifications set forth in Annex A of this Amended Term Loan   Term Sheet, and 
    


 

9











 

	
Related Provisions
    	
 
    	
(y) other customary exceptions, qualifications   and modifications in form and substance mutually acceptable to the Required   Consenting Term Loan Lenders and the Borrower:
    
	
 
    	
 
    	
 
    
	
Events of Default
    	
 
    	
Same as provided under the Existing Term Loan Credit   Agreement, but with the following revisions to the Event of Default set forth   in Section 8.01(8) of the Existing Term Loan Credit Agreement:

 

(8) an involuntary   proceeding is commenced or an involuntary petition is filed in a court of   competent jurisdiction seeking:

 

(a) relief in   respect of Mariposa Intermediate, any Co-Borrower or any of the Subsidiaries,   or of a substantial part of the property or assets of Mariposa Intermediate,   the Co-Borrowers or any Subsidiary, under Title 11 of the United States   Code, as now constituted or hereafter amended, or any other federal, state or   foreign bankruptcy, insolvency, or similar law and such proceeding or   petition continues undischarged, undismissed or unstayed for 60 calendar   days, or an order or decree approving or ordering any of the foregoing is   entered;

 

(b) the   appointment of a receiver, trustee, custodian, sequestrator, conservator or   similar official for Mariposa Intermediate, any Co-Borrower or any of the   Subsidiaries or for a substantial part of the property or assets of Mariposa   Intermediate, the Co-Borrowers or any Restricted Subsidiary and such   appointment occurs and continues undischarged, undismissed or unstayed for 60   calendar days from the date of such appointment; or

 

(c) the winding up   or liquidation of Mariposa Intermediate, any Co-Borrower or any Subsidiary   (except, in the case of any Subsidiary, in a transaction permitted by   Section 6.05) and such proceeding or petition continues undischarged,   undismissed or unstayed for 60 calendar days, or an order or decree   approving or ordering any of the foregoing is entered;

 

Notwithstanding anything to the contrary contained   herein or in the Agreement or otherwise, all existing Defaults or Events of   Default (if any) shall be permanently waived by the Participating Term Loan   Lenders on the Effective Date, effective as of the first date any such   Default or Event of Default exists or existed.
    
	
 
    	
 
    	
 
    
	
Voting
    	
 
    	
Same as provided under the Existing Term Loan Credit   Agreement, subject to customary and reasonable modifications relating to new   Classes.
    
	
 
    	
 
    	
 
    
	
Cost and Yield Protection
    	
 
    	
Substantially similar to the applicable provisions   of the Existing Term Loan Credit Agreement.
    
	
 
    	
 
    	
 
    
	
Assignments and Participations
    	
 
    	
Substantially similar to the applicable provisions   of the Existing Term Loan Credit Agreement as to Affiliated Lenders, but not   Mariposa Intermediate and its Subsidiaries.
    
	
 
    	
 
    	
 
    
	
Buybacks
    	
 
    	
No purchases of Term Loans by Mariposa Intermediate   and its Subsidiaries shall be permitted, whether by Dutch Auction, open   market purchase or otherwise.
    
	
 
    	
 
    	
 
    
	
Defaulting Lenders
    	
 
    	
Same as provided under the Existing Term Loan Credit   Agreement.
    


 

10











 

	
Expenses and Indemnification
    	
 
    	
Substantially similar to the applicable provisions   of the Existing Term Loan Credit Agreement, with modifications to be   reasonably agreed and provided the indemnity provisions shall apply to the   Recapitalization Transactions, the Agreement, the Nancy Transaction, the   MyTheresa Designation, and the MyTheresa Distribution and other matters   subject to the releases set forth in section 9 of the Agreement.
    
	
 
    	
 
    	
 
    
	
Non-Pro Rata Buy Back or Repurchase of Loans
    	
 
    	
At Borrower’s election, with the consent of the   Required Consenting Term Loan Lenders, Borrower may structure and implement   the transactions contemplated by this Amended Term Loan Term Sheet, including   the Amendment and Extension, as a non-pro rata buy   back or repurchase of Loans held by Participating Term Loan Lenders with   Extended Term Loans. Immediately prior to such buy back or repurchase,   Borrower and the Participating Term Loan Lenders constituting Required   Lenders shall (i) subordinate the liens of the Agent under the Term Loan   Credit Agreement on the collateral and/or (ii) release the liens on any   collateral held by Non-Participating Term Loan Lenders so long as the assets   subject to such lien release do not constitute a material portion of the   Collateral (as in effect on the Effective Date, immediately prior to the   consummation of the Recapitalization Transactions), in each case, in a manner   acceptable to Borrower and the Required Consenting Term Loan Lenders.
    
	
 
    	
 
    	
 
    
	
Fees
    	
 
    	
In consideration of the mutual agreements   contemplated herein and other good and valuable consideration, the Consenting   Term Loan Lenders and the Borrower agree that:

 

(i) each Initial   Consenting Term Loan Lender that participates in the Recapitalization   Transactions shall receive from the Borrower the Term Loan Lender Consent Fee   on the Effective Date, subject to the effectiveness and consummation of the   Recapitalization Transactions; and

 

(ii) each   Consenting Term Loan Lender that participates in the Recapitalization   Transactions and that has executed and delivered its respective signature   page to (or a joinder to) the Agreement by 5:00 pm Eastern Time on the   sixth Business Day following the Borrower’s public announcement (and posting   of signature pages to a dataroom available to all Lenders) of the execution   of the Agreement, shall receive from the Borrower the Term Loan Lender Cash   Joinder Fee on the Effective Date, subject to the effectiveness and   consummation of the Recapitalization Transactions.

 

“Term Loan Lender Consent   Fee” means a fee, with respect to each applicable Consenting   Term Loan Lender, in an amount equal to 1.25% of the aggregate principal   amount of the Term Loans held by such Consenting Term Loan Lender, as set   forth on such Consenting Term Loan Lender’s signature page to the   Agreement as of the Agreement Effective Date, as if such Consenting Term Loan   Lender exchanged all such Term Loans into Extended Term Loans in connection   with the Amendment and Extension and after giving effect to the Initial   Paydown.

 

“Term Loan Lender Cash   Joinder Fee” means a fee, with respect to each applicable   Consenting Term Loan Lender, in an amount equal to 0.25% of the aggregate   principal amount of the Extended Term Loans held by such Consenting Term Loan   Lender as set forth on such Consenting Term Loan Lender’s signature   page to the Agreement as of the Effective Date, after giving effect to   the Amendment and Extension and the Initial Paydown.
    


 

11











 

	
Tax Matters
    	
 
    	
For U.S. federal (and applicable state and local)   income tax purposes, the Company Parties shall not take any tax position   inconsistent with the treatment of (x) NMG LLC as an entity disregarded   as separate from the Borrower and (y) the Term Loan Lender Consent Fee   and the Term Loan Lender Cash Joinder Fee as additional consideration   realized on the exchange of the Term Loans for Extended Term Loans.
    
	
 
    	
 
    	
 
    
	
Governing Law and Forum
    	
 
    	
New York.
    


 

12












 

EXECUTION VERSION

FRE408/CONFIDENTIAL

 

ANNEX A:  COVENANT CHANGES

Neiman Marcus Group LTD LLC

 

Reference is hereby made to the Term Loan Credit Agreement, dated as of October 25, 2013, among Mariposa Intermediate Holdings LLC (“Holdings”), Neiman Marcus Group LTD LLC (the “Company”) (as successor by merger to Mariposa Merger Sub LLC), the subsidiaries of the Company from time to time party thereto, Credit Suisse AG, Cayman Islands Branch, as Administrative and Collateral Agent, and the lenders thereunder (the “Credit Agreement”).  All capitalized terms used herein and not otherwise defined, unless otherwise indicated, shall have the meaning ascribed to such terms in the Credit Agreement or the Transaction Support Agreement (including all exhibits, annexes, and schedules thereto), as applicable.

 

To the extent there is a conflict between this Annex A, on the one hand, and the Amended Term Loan Term Sheet, on the other hand, the terms and provisions of the body of the Amended Term Loan Term Sheet.

 


	
Item
    	
 
    	
Current Provision
    	
 
    	
Changes to Provision
    
	
Definitions
    	
 
    	
 
    	
 
    	
 
    
	
1.              “Available   Amount”
    	
 
    	
(i) $200M plus   (ii) Cumulative Retained Excess Cash Flow Amount, subject to other   customary builders
    	
 
    	
Available Amount concept to be eliminated, but   investments, payments to junior debt funded with net proceeds of common   equity issued by or contributed to Holdings and contributed to Borrower will   be permitted
    
	
2.              “Borrower”
    	
 
    	
Company
    	
 
    	
Each of the Company, The Neiman Marcus Group LLC and   one of The Neiman Marcus Group LLC’s subsidiaries (to be determined by the   Company; provided, that such subsidiary shall be either (x) an   entity treated as disregarded as separate from the Company for U.S. federal   income tax purposes or (y) an entity holding no material assets)
    
	
3.              “Change   of Control”
    	
 
    	
Pre-IPO, triggered if Permitted Holders cease to   beneficially own 50% or more
    	
 
    	
Pre-IPO, triggered if Permitted Holders cease to   beneficially own more than 50%
    
	
4.              “Excluded   Subsidiary”
    	
 
    	
Includes, among other things, Subsidiary that is not   a Wholly Owned Subsidiary of Holdings or the Borrower
    	
 
    	
Excluded Subsidiaries will not include non-Wholly   Owned Subsidiaries (except as set forth below under “Permitted   Acquisitions”), Immaterial Subsidiaries, Foreign Subsidiaries or similar   (other than Foreign Subsidiaries (1) existing today and (2) subject   to certain exceptions to be agreed based on foreign law requirements and any   adverse change in applicable tax law); provided that   (x) Immaterial Subsidiaries to either (i) be dissolved, liquidated   or merged out of existence or (ii) become a Guarantor, in each case,   within 90 days post-closing and (y) if MyTheresa Entities   re-contributed, they will be treated as “Unrestricted Subsidiaries” and   “Excluded Subsidiaries”
    
	
5.              “Guarantor”
    	
 
    	
Excludes a Restricted Subsidiary that is not a   Wholly Owned Subsidiary
    	
 
    	
Include all Restricted Subsidiaries, but exclude   “Excluded Subsidiaries” subject to changes to the definition thereof; provided that if MyTheresa Entities are required to be   re-contributed as a result of a court order, they will be treated as   “Unrestricted Subsidiaries” and “Excluded Subsidiaries”
    
	
6.              “Junior   Financing”
    	
 
    	
Indebtedness that is contractually subordinated in   right of payment to the Obligations or secured by Liens that are   contractually subordinated
    	
 
    	
To include (i) Existing 2028 Debentures,   (ii) the Senior Notes, (iii) the New Second Lien Notes and New   Third Lien Notes and (iv) any Indebtedness incurred to Refinance any of   the foregoing (and subsequent refinancings) (other than any first-lien   Indebtedness, subject to “Permissible Payments to Term Loan and/or Unsecured   Note Holdouts” below)
    
	
7.              “Net   Cash Proceeds”
    	
 
    	
Consideration < $10M will be deemed not to   be Net Cash Proceeds
    	
 
    	
Reduce Net Cash Proceeds threshold to <   $5M
    
	
8.              “Permitted   Acquisition”
    	
 
    	
Acquisitions of persons in a similar business uncapped   if person will become Loan Party. Capped at greater of $100M and 1.15% of   Consolidated Total Assets where Subsidiary will not be a Loan Party
    	
 
    	
Capped at $300M in aggregate Permitted Acquisitions;   provided that (1) no individual   Permitted Acquisition transaction or series of related transactions shall   exceed $150M (except as provided below with respect to incremental   investments) and (2) no Permitted Acquisition transactions if pro forma   ABL availability would be less than $300M. Wholly-owned entities acquired,   whether domestic or foreign, to become Loan Parties, provided,   further:

 

(i) consideration consisting of common equity   of Holdings/proceeds of common equity issued by Holdings and contributed to   Borrower/contributions to Holdings’ common equity capital further contributed   to Borrower excluded from $300M cap, and

 

(ii) transaction costs of NMG group are not   part of consideration.

 

“Permitted Acquisitions” to include acquisitions,   minority investments or joint ventures; provided, that joint ventures   (x) may not be consummated with affiliates of Holdings, the   Co-Borrowers, or their subsidiaries (except that such affiliates (including   any Sponsor but excluding Holdings, the Co-Borrowers, and their subsidiaries)   may co-invest in any such joint venture with an unaffiliated third party on   terms substantially similar to the terms of the applicable Loan Party or   Subsidiary’s investment without such affiliates’ investments being subject to   the caps set forth above), and (y) must be bona fide operating businesses   reasonably related to Borrower’s business and any such 
    




 











 


	
Item
    	
 
    	
Current Provision
    	
 
    	
Changes to Provision
    
	
 
    	
 
    	
 
    	
 
    	
acquisition, minority investment or joint venture   may not invest in debt or equity of Holdings or its Subsidiaries.

 

Incremental investments in entities (in any single   or series of transactions) subject to Permitted Acquisitions will be   permitted but count against the $300M aggregate / $150M per transaction caps;   provided however that incremental investments may exceed such $150M cap by an   additional aggregate amount of investments not to exceed $25M in any such   entity (in any single or series of transactions). By way of example, if a   Loan Party or its subsidiary makes an initial investment of $50M in a target   entity, such Loan Party or subsidiary would be able to make follow-on   investments in such target entity in an amount not to exceed $100M, plus an   additional $25M (in any single or series of transactions) such that the total   investment in such target entity pursuant to this basket shall not exceed   $175M, but subject to the $300M aggregate cap for such basket.

 

Assets acquired pursuant to Permitted Acquisitions   (including 100% of all equity interests, which shall not, for the avoidance   of doubt, constitute Excluded Assets) must be included in the collateral, and   any wholly-owned subsidiary so acquired (including any wholly-owned foreign   subsidiary) must become a guarantor; provided however that (i) any   entity that is acquired which is not a wholly-owned subsidiary or any   minority-owned entity or joint venture entity shall not be required to become   a guarantor, (ii) any non-wholly owned subsidiary or any minority-owned   entity or joint venture entity so acquired pursuant to this basket shall be   permitted to utilize this basket to permit such entity to fund its ratable   share of investments in other bona fide operating businesses, subject to the   $300M aggregate cap, $150M per transaction cap and $25M incremental cap set   forth above, and (iii) for purposes of clarity, a third party owner   (that is not Holdings or any of its subsidiaries) of a non-wholly owned   subsidiary, minority-owned entity or joint venture entity shall not be   required to pledge its equity interests in such entity as collateral.
    
	
9.              “Pro Forma Basis”   or “Pro Forma”
    	
 
    	
Pro forma effect given to factually supportable and   identifiable pro forma cost savings related to operational efficiencies,   strategic initiatives or purchasing improvements and other synergies, in each   case, reasonably expected by the Borrower and the Restricted Subsidiaries to   be realized based upon actions reasonably expected to be taken within 18   months of the date of such calculation (without duplication of the amount of   actual benefit realized during such period from such actions), which cost savings,   improvements and synergies can be reasonably computed, as certified in   writing by the chief financial officer of the Borrower
    	
 
    	
Limit look-forward to 12 months and cap such cost   savings at 10% of EBITDA (after giving effect to such adjustment) for any   measurement period
    
	
10.       “Restricted Subsidiary”   (or “Unrestricted Subsidiary”)
    	
 
    	
Subsidiary of a Person other than an Unrestricted   Subsidiary
    	
 
    	
(i) Loan Parties shall not designate any   Restricted Subsidiary as an Unrestricted Subsidiary after the Effective Date   and (ii) Nancy Holdings LLC (“Nancy Holdings”) and any other existing   Unrestricted Subsidiary shall be deemed a Restricted Subsidiary under the   Credit Agreement; provided that   (a) if MyTheresa Entities are re-contributed, they will be treated as   “Unrestricted Subsidiaries” and (b) for the avoidance of doubt, the   escrow issuer under the New Second Lien Notes to be an Unrestricted   Subsidiary prior to the effective date of the Recapitalization Transactions
    
	
11.       “Subsidiary Loan Parties”
    	
 
    	
(1) each Wholly Owned Domestic Subsidiary of   the Borrower on the Closing Date (other than any Excluded Subsidiary); and   (2) each Wholly Owned Domestic Subsidiary (other than any Excluded   Subsidiary) of the Borrower that becomes, or is required to become, a party   to the Collateral Agreement after the Closing Date
    	
 
    	
(1) each Restricted Subsidiary of the Borrower   on the Amendment Effective Date (other than any Excluded Subsidiary); and   (2) each Restricted Subsidiary (other than any Excluded Subsidiary) of   the Borrower that becomes, or is required to become, a party to the   Collateral Agreement after the Amendment Effective Date
    
	
Asset Sales
    	
 
    	
 
    	
 
    	
 
    
	
12.       Reinvestment Prepayment   Amount (§2.08(1))
    	
 
    	
Allows application of Net Cash Proceeds to restore,   rebuild, repair, construct, improve, replace or otherwise acquire assets used   or useful in the Borrower’s or a Restricted Subsidiary’s business
    	
 
    	
·                  Net   Cash Proceeds of Asset Sales must be used to prepay Term Loans within 3   Business Days, provided:

 

·                  In   the case of an Asset Sale with respect to a warehouse/distribution center, no   prepayment required to the extent of the cost of any investment in, or   purchase of, a new warehouse/distribution center (but not to exceed the Net   Cash Proceeds of such Asset Sale) completed within 24 months before or 12   months after the date of such Asset Sale.

 

·                  $30mm   reinvestment of Net Cash Proceeds from sales or dispositions of stores may be   applied to capex incurred within 12 months of the date of the Asset Sale.
    
	
Information
    	
 
    	
 
    	
 
    	
 
    
	
13.       Financial Statements,   Reports, etc. (§5.04)
    	
 
    	
Required Financial Statements, certain compliance   certificates, periodic and other publicly available 
    	
 
    	
In addition to information already provided in   §5.04, Required Financial Statements to include (i) information related   to comparable revenues for brick and mortar stores 
    




 











 


	
Item
    	
 
    	
Current Provision
    	
 
    	
Changes to Provision
    
	
 
    	
 
    	
reports / proxy statements, Budgets, and certain   other information
    	
 
    	
vs. online of Loan Parties and its subsidiaries,   (ii) information currently being disclosed in consolidating financials   as of the date hereof with respect to entities that are non-guarantors as of   the date hereof (or, at Company’s election, as to Bergdorf), despite changes   in public company reporting requirements hereafter, and (iii) management   to hold public quarterly conference calls including question and answer   sessions.
    
	
Further Assurances
    	
 
    	
 
    	
 
    	
 
    
	
14.       Mortgages (§5.10(2))
    	
 
    	
If Loan Party acquires fee simple title in Real   Property that combined with all other Real Property of Loan Parties has an   aggregate fair market value of > $50M, then within 20 business days, cause   such Real Property that is > $7.5M to be subject to customary mortgages
    	
 
    	
Delete $50M FMV aggregate threshold

 

$2.5M FMV individual threshold on future fee simple   real property interests

 

Cause each existing fee simple Real Property   interest listed on a new schedule, or hereafter acquired subject to the   threshold above, to be subject to mortgages and take all other applicable   actions in respect of such interests consistent with Section 5.10(2)

 

Provide leasehold mortgages over (i) NMG full   line stores, (ii) BG properties and (iii) distribution centers to   the extent permitted by the applicable real estate documents and subject to   diligence relating to third party consents. To the extent any such leasehold   Real Property interest cannot be mortgaged, applicable NMG entity to   contribute such leasehold interests into “New Subsidiary” and Consenting Term   Loan Lenders to receive a first priority pledge over the equity interests of   such New Subsidiary.
    
	
15.       Accounts (§5.10(4))
    	
 
    	
Borrower to execute all documents reasonably   requested by the Collateral Agent with respect to creation and perfection of   Liens on the Collateral contemplated in the Credit Agreement and the Security   Documents
    	
 
    	
Clarify that Loan Parties shall enter into Control   Agreements (as defined in the Guarantee & Collateral Agreement) with   respect to the Blocked Accounts (as defined in the ABL Credit Agreement), the   Asset Sale Proceeds Accounts, and all other Deposit Accounts, Security   Accounts, and Commodities Accounts (each, as defined in the Collateral   Agreement) that are subject to any deposit account control agreements or   similar arrangement providing for perfection by control in connection with   the ABL Loan Documents (in each case consistent with and subject to the   Intercreditor Agreement)
    
	
16.       Exercise of Remedies on   Pledged Equity (§3.05(2) of Guarantee & Collateral Agreement)
    	
 
    	
N/A
    	
 
    	
Add language to §3.05(2) of   Guarantee & Collateral Agreement that Collateral Agent shall provide   at least 1 business days’ prior written notice to debtors before exercising   remedies on pledged equity
    
	
Debt
    	
 
    	
 
    	
 
    	
 
    
	
17.       Ratio Debt (§6.01)
    	
 
    	
Unlimited if > 2.0x Interest Coverage   Ratio on pro forma basis
    	
 
    	
Unsecured or junior-lien Ratio Debt if >   2.25x Interest Coverage Ratio on pro forma basis; Ratio Debt not permitted by   Restricted Subsidiaries that are not Guarantors
    
	
18.       Incremental Amount   (§6.01(1), §2.18, §2.19)
    	
 
    	
$650M free and clear incremental term loan or   Incremental Equivalent Term Debt,

 

Unlimited incremental pari debt so long as <   4.25x Senior Secured First Lien Net Leverage Ratio
    	
 
    	
No Incremental Term Loans or other debt permitted   under §6.01(1) or §2.18 other than Credit Agreement Refinancing   Indebtedness and except as provided below under “Debt Incurred to Refinance   Transaction Holdouts” (for the avoidance of doubt, clause (a) of   §6.01(1) with respect to Indebtedness created under the Loan Documents   shall be modified to permit Extended Term Loans and Credit Agreement Refinancing   Indebtedness (including Other Term Loans), but neither Incremental Term Loans   nor Incremental Equivalent Term Debt).

 

Drafting changes to §2.19 to make clear incurrence   thereunder is limited to Credit Agreement Refinancing Indebtedness
    
	
19.       ABL Basket (§6.01(2))
    	
 
    	
ABL debt not to exceed greater of   (i) $1,100,000,000 and (ii) borrowing base
    	
 
    	
ABL basket capped at $1,000,000,000
    
	
20.       Acquisition financing   (§6.01(12))
    	
 
    	
Permitted without cap subject to no EOD, certain   financial tests and $75M cap on non-guarantor debt.
    	
 
    	
Conforming changes to give effect to row #8 above.
   In addition to existing no EoD and financial tests, any Indebtedness of   target retained/assumed will count against the $300mm Permitted Acquisitions   basket and $150mm sublimit and the $25M incremental investment sublimit.

Reduce $75M non-guarantor basket to $50M.
    
	
21.       Purchase Money / Capital   Leases (§6.01(5))
    	
 
    	
Greater of $200M and 2.25% of Consolidated Total   Assets
    	
 
    	
Greater of $200M and 2.25% of Consolidated Total   Assets; provided, however, that once the Hudson Yards Indebtedness   obligations cease to be outstanding under this basket, to be capped at the   greater of $100M and 1.125% of Consolidated Total Assets.
    
	
22.       Qualified Receivables   Financing (§6.01(17))
    	
 
    	
Non-recourse receivables based lending facility   permitted, which may be secured
    	
 
    	
Not permitted
    
	
23.       Joint Ventures   (§6.01(20))
    	
 
    	
Greater of $50M and 0.50% of Consolidated Total   Assets
    	
 
    	
Not permitted
    
	
24.       Foreign Subsidiaries   (§6.01(21))
    	
 
    	
Greater of $50M and 0.50% of Consolidated Total   Assets
    	
 
    	
$25M, no grower
    




 












 


	
Item
    	
 
    	
Current Provision
    	
 
    	
Changes to Provision
    
	
25.       General Basket   (§6.01(27))
    	
 
    	
Greater of $250M and 2.75% of Consolidated Total   Assets
    	
 
    	
$100M (no grower), with a cap of 8% cash interest on   any debt under this basket
    
	
26.       New Second Lien Notes/New   Third Lien Notes Debt Basket (§6.01)
    	
 
    	
N/A
    	
 
    	
Permit the New Second Lien Notes and the New Third   Lien Notes (and guarantees of the foregoing) issued on the closing date
    
	
27.       Debt Incurred to   Refinance Transaction Holdouts (“Specified Permitted Debt”)
    	
 
    	
N/A
    	
 
    	
·                  First-lien/second out debt under   credit agreement with no amortization, maturity no earlier than extended term   loans, not subject to any “most-favored nation” provisions, and maximum L+600   cash interest rate may be incurred in a principal amount equal to the   principal amount of non-extending term loans in order to refinance such   non-extending term loans

 

·                  Incremental third-lien notes with   no amortization, not subject to any “most-favored nation” provisions and a   maturity no earlier than the New Third Lien Notes issued on the Effective   Date in an aggregate principal amount not to exceed 85% of the aggregate   principal amount of non-extending Unsecured Notes may be incurred to   refinance non-extending Unsecured Notes; provided that the cash interest rate   on such incremental third-lien notes will not exceed that of the New Third   Lien Notes issued on the Effective Date

 

·                  Non-tendering Unsecured Notes may   be refinanced par-for-par with unsecured debt with no amortization, not   subject to any “most-favored nation” provisions but with a cash interest rate   not in excess of that of the existing Unsecured Notes outstanding on the   Effective Date and maturity no earlier than the New Third Lien Notes issued   on the Effective Date
   Other provisions of “Permitted Refinancing Indebtedness” apply except as   provided above.
    
	
Liens
    	
 
    	
 
    	
 
    	
 
    
	
28.       Liens on Qualified   Receivables Facilities (§6.02(4))
    	
 
    	
Liens on Qualified Receivables Financing incurred in   accordance with debt covenant
    	
 
    	
Not permitted
    
	
29.       Certain Deposits   (§6.02(14))
    	
 
    	
Deposits to secure performance of bids, trade   contracts, leases, etc., other obligations of a like nature incurred in   the ordinary course of business
    	
 
    	
Clarify to cover deposits to secure the delivery of   merchandise or services with factors (to company suppliers), vendors,   shippers, brand partners, credit insurers and other service providers in the   ordinary course (but not to secure Indebtedness or receivables or capital   lease financing by company)
    
	
30.       Pari Passu   Liens (§6.02(31))
    	
 
    	
Pro forma compliance with < 4.7x Senior   Secured Leverage Ratio
    	
 
    	
Not permitted.
    
	
31.       Junior Liens (§6.02(32))
    	
 
    	
Pro forma compliance with < 7.0x Total   Leverage Ratio
    	
 
    	
Not permitted by Restricted Subsidiaries that are not   Guarantors; limited to secure general debt, applicable holdout refinancing,   2.25x interest coverage and other applicable refinancing debt baskets,   subject to intercreditor arrangements to be agreed
    
	
32.       General Basket   (§6.02(33))
    	
 
    	
Greater of (x) $250M and (y) 2.75% of   Consolidated Total Assets
    	
 
    	
Reduce to $50M, no grower, with a cap of 8% cash   interest on any debt that liens secure under this basket
   Liens granted pursuant to general basket securing debt for borrowed money   must be solely on Collateral and must be junior to liens in favor of Lenders   under Term Loan Facility
    
	
33.       New Second Lien Notes/New   Third Lien Notes Debt Basket (§6.02)
    	
 
    	
N/A
    	
 
    	
Permit liens securing the New Second Lien Notes and   the New Third Lien Notes (and guarantees of the foregoing) and the third-lien   notes basket to address unsecured note holdouts
    
	
34.       Specified Permitted Debt
    	
 
    	
N/A
    	
 
    	
Permit liens securing Specified Permitted Debt (and   guarantees of the foregoing) consistent with row 26 above
    
	
Sale   and Lease-Back Transactions
    	
 
    	
 
    
	
35.       Acquired Properties   (§6.03(1))
    	
 
    	
Permitted if obligations incurred within 270 days of   transaction; no time limit if Foreign Subsidiary
    	
 
    	
270 day limit applies to all Subsidiaries
    
	
36.       Existing Properties   (§6.03(2))
    	
 
    	
Permitted if Remaining Present Value of given lease <   $200M and proceeds applied in prepayment of Term Loan/pari passu debt
    	
 
    	
Permitted with respect to one or more transactions   resulting in aggregate net sale proceeds not to exceed $250mm, subject to   Required Lender consent (as part of elective paydown mechanism) (not subject   to prepayment premium)
    
	
Investments
    	
 
    	
 
    	
 
    	
 
    
	
37.       Loans / Advances to   Parent Entity D&Os (§6.04(2))
    	
 
    	
Permitted loans and advances to officer’s directors,   employees or consultants of Parent Entity if < $25M in aggregate   outstanding
    	
 
    	
$5M aggregate cap for loans and advances to   officers, directors or employees or consultants
   Clarify that there is no cap on upfront payments in connection with   consulting arrangements entered into in the ordinary course of business
    
	
38.       Available Amount   (§6.04(3))
    	
 
    	
Investments in an amount not to exceed the Available   Amount
    	
 
    	
Available Amount concept to be eliminated;   investments funded with net proceeds of common equity issued by or 
    




 











 


	
Item
    	
 
    	
Current Provision
    	
 
    	
Changes to Provision
    
	
 
    	
 
    	
 
    	
 
    	
contributed to Holdings and contributed to Borrower   will be permitted
    
	
39.       Permitted Acquisitions   (§6.04(4))
    	
 
    	
Unlimited if person will become Loan Party. Capped   at greater of (i) $100M and (ii) 1.15% of Consolidated Total Assets   where subsidiary will not be a Loan Party.
    	
 
    	
Conforming changes to give effect to row #8 above
    
	
40.       Intercompany Investments   (§6.04(5))
    	
 
    	
Unlimited among Borrower and Restricted   Subsidiaries. Non-guarantor intercompany Investments limited to greater of   (i) $50M and (ii) 0.50% Consolidated Total Assets
    	
 
    	
Intercompany investments in non-Guarantors capped at   $25M, no grower; must be pledged to secure the Extended Term Loans, subject   to Excluded Assets carveouts (as amended in accordance with Amended Term Loan   Term Sheet).
   Intercompany investments with non-wholly owned subs must be on arm’s-length   terms
    
	
41.       Investments in Foreign   Subsidiaries (§6.04(6))
    	
 
    	
Greater of (i) $100M and (ii) 1.15% of   Consolidated Total Assets
    	
 
    	
Not permitted
    
	
42.       Investments in a   Receivables Subsidiary (§6.04(26))
    	
 
    	
Investments in a Receivables Subsidiary in   connection with a Qualified Receivables Financing
    	
 
    	
Not permitted
    
	
43.       General Basket   (§6.04(29))
    	
 
    	
Greater of (x) $150M and (y) 1.75%   Consolidated Total Assets
    	
 
    	
Capped at $25M, no grower, cannot be in any Parent   Entity or its Subsidiaries (other than a Loan Party or its Subsidiaries),   including any MyTheresa Entity; must be pledged as collateral (subject to the   Excluded Assets definition as modified by the Amended Term Loan Term Sheet)
    
	
Mergers,   Consolidations, Sales of Assets and Acquisitions
    	
 
    	
 
    
	
44.       Assumed liabilities   (§6.05(2)(c)(i))
    	
 
    	
Ability to count assumed liabilities by transferee   as cash for purposes of sale, transfer or disposition
    	
 
    	
Amend to exclude Junior Financing from liabilities   counted as cash
    
	
45.       Non-Cash Securities   (§6.05(2)(c)(ii))
    	
 
    	
Ability to count securities that are converted to   cash within 180 days following disposition
    	
 
    	
Ability to count securities that are converted to   cash within 90 days following disposition
    
	
46.       Designated Non-Cash   Consideration (§6.05(2)(c)(iii))
    	
 
    	
Greater of (x) $125M and (y) 1.50% of   Consolidated Total Assets across all Asset Sales
    	
 
    	
Delete ability to count Designated Non-Cash   Consideration as cash
    
	
47.       Net Cash Proceeds / Below   Asset Sale Threshold Proceeds (“Below Threshold Asset   Sale Proceeds”, “Net Cash Proceeds”,   (§6.05(12))
    	
 
    	
Asset sales permitted without restriction so long as   < $10M
    	
 
    	
Reduce to $5M
    
	
Restricted Payments
    	
 
    	
 
    	
 
    	
 
    
	
48.       Equity Repurchases from   D&Os (§6.06(2)(a))
    	
 
    	
$30M per fiscal year (carry over unused amounts for   succeeding 3 fiscal years)
    	
 
    	
$20M per fiscal year (no carryforward); limited to   current (not former) D&Os, except permit a basket for former D&Os not   to exceed $5M in the aggregate during life-of-loan
    
	
49.       Parent Entity Operating   Expenses (§6.06(6))
    	
 
    	
Payments to Parent Entity (a) for operating,   overhead, legal, accounting, and other costs, (b) related to public   offering or private placement of debt or equity securities of Parent Entity   or any Permitted Investment (c) franchise taxes and other fees,   (d) consistent with affiliate transactions and Holdings covenants, to   the extent due, and (e) customary salary, bonus, benefits to D&Os
    	
 
    	
Clauses (a) and (e): clarify exclusion of any   costs, fees and expenses for, or allocable to, MyTheresa Entities, or in   respect of related litigation (other than litigation for defense which may be   covered as relating to the Loan Parties and their Subsidiaries), after date   of the Agreement
   Clause (b): limit to relate to transactions the proceeds of which are   intended to be contributed to Borrower
   Clause (d): delete carveout for payments consistent with Holdings covenant
    
	
50.       Sponsor Fees (§6.06(9))
    	
 
    	
Payments to Parent Entity for sponsor fees and   expenses
    	
 
    	
Remove clause (a).
   Eliminate Event of Default limiter.
   Clause (b) to be restated: “indemnities of, and reimbursement of   reasonable and documented out-of-pocket fees and expenses to Sponsors, in   each case incurred in connection with the provision by Sponsors of bona fide   services (including such services provided under the Management Agreement) to   any Parent Entity for the benefit of Holdings and its Subsidiaries and not,   for the avoidance of doubt, in respect of MyTheresa Entities, the MyTheresa   Distribution or any litigation related thereto (other than litigation for   defense), subject to reasonable pro-ration of joint services/costs.”
    
	
51.       Permitted Investments   (§6.06(11))
    	
 
    	
Payments to Parent Entity to finance a Permitted   Investment contributed to Borrower
    	
 
    	
Not permitted
    
	
52.       Dividend / Redemption   (§6.06(12))
    	
 
    	
Payments of any dividend or distribution or   consummation of redemption within 60 days after the date of declaration or   redemption notice, if payment would have complied with the Credit Agreement   as of the date of notice or declaration
    	
 
    	
Not permitted
    
	
53.       Excluded Contributions   (§6.06(13))
    	
 
    	
Payments made with Excluded Contributions
    	
 
    	
Not permitted
    




 











 


	
Item
    	
 
    	
Current Provision
    	
 
    	
Changes to Provision
    
	
54.       Capital Stock &   Debt of Unrestricted Subsidiaries (§6.06(14))
    	
 
    	
Distribution of Capital Stock of or Indebtedness   owed to the Borrower or any Restricted Subsidiary by, Unrestricted   Subsidiaries
    	
 
    	
Not permitted
    
	
55.       Available Amount   (§6.04(15))
    	
 
    	
If pro forma compliance with >2x FCCR and no   Event of Default, RPs permitted up to Available Amount
    	
 
    	
Not permitted
    
	
56.       General Basket   (§6.06(16))
    	
 
    	
Greater of (x) $100mm and (y) 1.15%   Consolidated Total Assets (reduces corresponding Permitted Investment and   Junior Financings baskets)
    	
 
    	
Not permitted
    
	
57.       MyTheresa Distribution   Basket
    	
 
    	
N/A
    	
 
    	
Permit the distribution or dividend of the MyTheresa   Assets (or proceeds from a sale of MyTheresa Assets or the MyTheresa   Entities) in the event the MyTheresa Assets (or proceeds from such sale) are   contributed to Holdings or any of its subsidiaries on or after the Effective   Date, to the extent the MyTheresa Assets (or such proceeds) are required to   be distributed in accordance with any settlement, judgment, court order or   other resolution of a Claim, Cause of Action or litigation with respect to   the MyTheresa Distribution or the MyTheresa Designation, without being   subject to any conditions or other requirements.
    
	
Affiliate Transactions
    	
 
    	
 
    	
 
    	
 
    
	
58.       Dollar Threshold (§6.07)
    	
 
    	
Permitted without arm’s-length test if transaction   involves aggregate consideration < $15M
    	
 
    	
Reduce to $2.5M
   Delete “(i) otherwise permitted (or required) under this Agreement or   (ii)”
    
	
59.       Transactions with   Non-Guarantors (§6.07(1))
    	
 
    	
Permitted without arms-length test if transaction   between (a) the Borrower and the Restricted Subsidiaries or (b) the   Borrower and any person that becomes a Restricted Subsidiary as a result of   such transaction
    	
 
    	
Require transactions with non-guarantors to be arm’s   length, with exception for shared overhead in the ordinary course
    
	
60.       Management Agreement Fees   (§6.07(2))
    	
 
    	
So long as no EOD, payment of management,   monitoring, consulting, oversight and other fees in accordance with   Management Agreement
    	
 
    	
Conforming changes consistent with row #50
    
	
61.       Transactions (§6.07(6))
    	
 
    	
Permits Transactions and transactions pursuant to   Transaction Documents (original leveraged buyout)
    	
 
    	
Not permitted
    
	
62.       Sponsor Fees (§6.07(10))
    	
 
    	
Payment to Sponsors for certain advisory services   approved by majority of the Board of Directors or majority of the   Disinterested Directors
    	
 
    	
Not permitted
    
	
63.       Shared Directors   (§6.07(19))
    	
 
    	
Transactions between or among the Borrower and the   Restricted Subsidiaries and any Person, a director of which is also a   director of the Borrower or any Parent Entity, so long as (i) director   abstains from voting for Borrower or Parent Entity on any matter involving   such other Person and (ii) such Person is not an Affiliate of the Borrower   for any other reason.
    	
 
    	
Not permitted
    
	
64.       Transactions Complying   with Other Covenants (§6.07(20))
    	
 
    	
Transactions complying with indebtedness,   investments, and merger covenants
    	
 
    	
Not permitted
    
	
Limitation on Payments and Modifications of   Indebtedness; Modifications of Certificate of Incorporation, By Laws and   Certain Other Agreements; etc.
    
	
65.       Available Amount   (§6.09(2)(a))
    	
 
    	
Payments in respect of Junior Financing in an amount   not to exceed the Available Amount
    	
 
    	
Available Amount concept to be eliminated, but   payments to junior debt funded with net proceeds of common equity issued by   or contributed to Holdings and further contributed to Borrower will be   permitted
    
	
66.       Ratio (§6.09(2)(b))
    	
 
    	
Payments in respect of Junior Financings so long as   pro forma compliance with Total Net Leverage Ratio < 4.50x
    	
 
    	
Not permitted.
    
	
67.       General (§6.09(2)(c))
    	
 
    	
Greater of (x) $100M and (y) 1.15%   Consolidated Total Assets (reduces corresponding Permitted Investment and   Restricted Payments baskets)
    	
 
    	
Not Permitted.
    
	
68.       Permissible Payments to   Term Loan and/or Unsecured Note Holdouts
    	
 
    	
N/A
    	
 
    	
Term Loans and Unsecured Notes that do not   participate in the Recapitalization Transactions will only be permitted to be   repurchased, repaid, exchanged for and/or refinanced, whether at or prior to   their applicable maturities (including voluntarily), with consideration   consisting of:

 

·                  Specified Permitted Debt or the   cash proceeds thereof

 

·                  cash proceeds of common equity   contributions to or common equity sales by Holdings;

 

·                  non-cash consideration contributed   to the common equity capital of Holdings, or purchased by Holdings for common   equity (including without limitation interests in MyTheresa so contributed or   purchased) and/or common equity of Holdings; and/or

 

·                  Up to an aggregate $60 million in   cash from whatever other source (excluding from such cap any consideration   described in the above three bullet points); provided any debt prepaid or   purchased
    




 











 


	
Item
    	
 
    	
Current Provision
    	
 
    	
Changes to Provision
    
	
 
    	
 
    	
 
    	
 
    	
pursuant to this $60   million basket more than 45 days prior to such debt’s maturity date cannot be   purchased at a price greater than (i) 90% in cash of face value in the   case of non-extending term loans and (ii) 40% in cash of face value in   the case of non-extending Unsecured Notes
    
	
69.       New Second Lien Notes
    	
 
    	
N/A
    	
 
    	
Permit scheduled/mandatory payments on New Second   Lien Notes contemplated by New Second Lien Notes Term Sheet
    
	
70.       New Third Lien Notes
    	
 
    	
N/A
    	
 
    	
Permit scheduled/mandatory payments on New Third   Lien Notes contemplated by New Third Lien Notes Term Sheet
    
	
Events of Default
    	
 
    	
 
    	
 
    	
 
    
	
71.       Involuntary Proceeding /   Petition (§8.01(8))
    	
 
    	
60 day period undismissed proceeding only applicable   to winding up or liquidation of Holdings, the Borrower or any Material Subsidiary
    	
 
    	
Match changes in Exhibit D of the TSA and   Amended Term Loan Term Sheet.
    
	
Miscellaneous
    	
 
    	
 
    	
 
    	
 
    
	
72.       Certain Subsidiary   Covenants (§7.02)
    	
 
    	
N/A
    	
 
    	
Restrictions on debt incurrence, liens and other   matters, including guarantees of debt other than loans in order to implement   restructuring transactions with respect to “New Subsidiary” and “PropCo” (if   any) that will hold real estate (as to non-mortgageable assets)
    
	
73.       Successor Agent (§9.09)
    	
 
    	
(i) no ability for Lenders to direct   Administrative Agent to resign;
    
   (ii) upon resignation, Required Lenders shall appoint successor from   among the Lenders, subject to Borrower approval (not unreasonably withheld)
    	
 
    	
(i) ability for Required Lenders to direct   Administrative Agent to resign;
    
   (ii) upon resignation, Required Lenders shall appoint a successor   subject to Borrower approval (not to be unreasonably withheld, conditioned,   or delayed) and the Borrower shall use commercially reasonable efforts,   including payment of customary fees, to cause successor to take office; provided that no Borrower approval shall be required if   replacement agent is Cortland, Wilmington Trust or Ankura.
    
	
74.       Assignments (§10.04(1),   (10), (14))
    	
 
    	
Ability for Lenders to assign Term Loans to Loan   Parties or their subsidiaries
    	
 
    	
Prohibit Lenders from assigning Term Loans to any   Loan Party or its Subsidiaries; however, existing provisions with respect to   Affiliated Lenders to remain per current
    
	
75.       Indemnification   (§10.05(7))
    	
 
    	
N/A
    	
 
    	
Effective as of the Effective Date of the   Recapitalization Transactions, indemnity shall extend to anything related to   or in connection with Recapitalization Transactions, MyTheresa transactions,   other similar claims covered by the Release in the Transaction Support   Agreement
    
	
76.       Recapitalization   Transactions Carve Outs
    	
 
    	
N/A
    	
 
    	
Permit transactions contemplated by, and   implementation of, the Recapitalization Transactions throughout agreement as   necessary
    




 












 

FRE408/CONFIDENTIAL

 

Annex B

 

New Term Loan Priority Assets

 

	
#
    	
 
    	
Locations
    	
 
    	
Address
    	
 
    	
Store 
   Number
    
	
 
    	
 
    	
 
    
	
Owned Locations
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
1.
    	
 
    	
Longview, TX
    	
 
    	
2301 Neiman Marcus   Parkway
   Longview Texas 75602
    	
 
    	
N/A
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
2.
    	
 
    	
San Antonio, TX
    	
 
    	
15900 La Cantera   Parkway
   San Antonio, Texas 78256
    	
 
    	
1037
    
	
 
    	
 
    	
 
    
	
Leased   Locations
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
3.
    	
 
    	
Dallas, TX   (Downtown)(3)
    	
 
    	
1622 Main Street
   Dallas, Texas 75201(4)
    	
 
    	
1001
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
4.
    	
 
    	
Dallas, TX (Northpark)
    	
 
    	
8687 North Central   Expressway, Suite 400 Dallas, Texas 75225
    	
 
    	
1002
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
5.
    	
 
    	
Houston, TX
    	
 
    	
2600 S. Post Oak Road
   Houston, Texas 77056
    	
 
    	
1004
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
6.
    	
 
    	
Bal Harbour, FL
    	
 
    	
9700 Collins Avenue
   Bal Harbour, Florida 33154
    	
 
    	
1005
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
7.
    	
 
    	
Atlanta, GA
    	
 
    	
3393 Peachtree Road   N.E.
   Atlanta, Georgia 30326
    	
 
    	
1006
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
8.
    	
 
    	
St. Louis, MO
    	
 
    	
100 Plaza Frontenac
   St. Louis, Missouri 63131
    	
 
    	
1007
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
9.
    	
 
    	
Northbrook, IL
    	
 
    	
5000 Northbrook Court
   Northbrook, Illinois 60062
    	
 
    	
1009
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
10.
    	
 
    	
Fashion Island, CA   (Newport Beach)
    	
 
    	
601 Newport Center   Drive
   Newport, California 92660
    	
 
    	
1011
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
11.
    	
 
    	
Westchester, NY
    	
 
    	
2 East Maple Avenue
   White Plains, New York 10601
    	
 
    	
1014
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
12.
    	
 
    	
Las Vegas, NV
    	
 
    	
3200 South Las Vegas   Boulevard, Suite 100
   Las Vegas, Nevada 89109
    	
 
    	
1015
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
13.
    	
 
    	
San Diego, CA
    	
 
    	
7027 Friars Road
   San Diego, CA 92108
    	
 
    	
1016
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
14.
    	
 
    	
Oakbrook, IL
    	
 
    	
6 Oakbrook Center
   Oak Brook, Illinois 60523
    	
 
    	
1017
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
15.
    	
 
    	
Chicago, IL
    	
 
    	
737 North Michigan   Avenue
   Chicago, Illinois 60611
    	
 
    	
1019
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
16.
    	
 
    	
Boston, MA
    	
 
    	
5 Copley Place
   Boston, Massachusetts 02116
    	
 
    	
1020
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
17.
    	
 
    	
Palo Alto, CA
    	
 
    	
400 Stanford Shopping   Court
   Palo Alto, California 94304
    	
 
    	
1024
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
18.
    	
 
    	
Short Hills, NJ
    	
 
    	
1200 Morris Turnpike
   Short Hills, New Jersey 07078
    	
 
    	
1025
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
19.
    	
 
    	
Denver, CO
    	
 
    	
3030 East First Avenue
   Denver, Colorado 80206
    	
 
    	
1027
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
20.
    	
 
    	
Scottsdale, AZ
    	
 
    	
6900 East Camelback   Road
   Scottsdale, Arizona 85251
    	
 
    	
1024
    


 




(3)           Nine parcels comprise this Dallas location, eight of which are leased pursuant to five lease agreements.

 

(4)           1618 Main Street, Dallas, Texas 75201 is the street address for all parcels, leased and owned.

 











 

	
#
    	
 
    	
Locations
    	
 
    	
Address
    	
 
    	
Store 
   Number
    
	
21.
    	
 
    	
King of Prussia, PA
    	
 
    	
170 N. Gulph Road
   King of Prussia, Pennsylvania 19406
    	
 
    	
1025
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
22.
    	
 
    	
Ala Moana, HI   (Honolulu)
    	
 
    	
1450 Ala Moana   Boulevard
   Honolulu, Hawaii 96814
    	
 
    	
1027
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
23.
    	
 
    	
Palm Beach, FL
    	
 
    	
151 Worth Avenue
   Palm Beach, Florida 33480
    	
 
    	
1024
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
24.
    	
 
    	
Boca Raton, FL
    	
 
    	
5860 Glades Road
   Boca Raton, Florida 33431
    	
 
    	
1038
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
25.
    	
 
    	
Bergdorf Goodman   Women’s (New York, NY)
    	
 
    	
742-754 Fifth Avenue, 1   West 57th St. and 2 West 58th St., New York, NY
    	
 
    	
1063
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
26.
    	
 
    	
Bergdorf Goodman Men’s   (New York, NY)
    	
 
    	
745 Fifth Avenue
   New York, NY
    	
 
    	
1064
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
27.
    	
 
    	
Clearfork, TX (Fort   Worth)
    	
 
    	
5200 Monahans Avenue
   Fort Worth, Texas 76107
    	
 
    	
1104
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
28.
    	
 
    	
Bellevue, WA
    	
 
    	
11111 NE 8th Street   Bellevue
   Washington 98004
    	
 
    	
1106
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
29.
    	
 
    	
Roosevelt Field, NY
   (Garden City)
    	
 
    	
620 Old Country Road
   Roosevelt Field Mall
   Garden City, New York
    	
 
    	
1111
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
30.
    	
 
    	
Hudson Yards, NY
    	
 
    	
20 Hudson Yards
   New York, NY 10001
    	
 
    	
1112
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
31.
    	
 
    	
East Coast DC (Pittson,   PA)
    	
 
    	
450 Centerpoint Blvd.
   Pittston, PA 18640
    	
 
    	
N/A
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
32.
    	
 
    	
Pinnacle Park DC
   (Dallas, TX)
    	
 
    	
4125 Pinnacle Point Dr.
   Dallas, TX 75211
    	
 
    	
N/A
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
33.
    	
 
    	
Paramus, NJ
    	
 
    	
503 Garden State Plaza   Boulevard
   Paramus, New Jersey 07652
    	
 
    	
1028
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
34.
    	
 
    	
Washington, D.C.
    	
 
    	
5300 Wisconsin Avenue   N.W.
   Washington, DC 20015
    	
 
    	
1008
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
35.
    	
 
    	
Tampa, FL
    	
 
    	
2223 N. West Shore   Boulevard
   Tampa, Florida 33607
    	
 
    	
1035
    


 

15












 

Exhibit 6

 

Collateral and Ranking of Priorities of Security Interests

 

	
 
    	
 
    	
Term Priority
   Collateral
   (other than
   New Term
   Loan Priority
   Assets)
    	
 
    	
New Term
   Loan Priority
   Assets
    	
 
    	
ABL Priority
   Collateral
    	
 
    	
PropCo Assets
   and/or Equity
   Interests of
   PropCo
   (pre-call)
    	
 
    	
PropCo Assets
   and/or Equity
   Interests of
   PropCo
   (post-call)
    	
 
    	
Equity Interests
   of New
   Subsidiary
    	
 
    	
50% of Common
   Equity Interests
   of MT Issuer
    	
 
    	
Assets of
   MyTheresa
   Guarantor
   Entities
   (including
   MyTheresa
   Account)(2)
    
	
Extended Term Loans of   Consenting Term Loan Lenders under Amended Term Loan Credit Agreement
    	
 
    	
1
    	
 
    	
1
    	
 
    	
2
    	
 
    	
3
    	
 
    	
1
    	
 
    	
1
    	
 
    	
None
    	
 
    	
None
    
	
Initial Loans of   Non-Participating Term Loan Lenders under Amended Term Loan Credit Agreement
    	
 
    	
5 or, at the Company   Parties’ option, higher lien priority (up to 1, pari passu   with Extended Term Loans)
    	
 
    	
None
    	
 
    	
5 or, at the Company   Parties’ option, higher lien priority (up to 2, pari passu   with Extended Term Loans)
    	
 
    	
None
    	
 
    	
None
    	
 
    	
None
    	
 
    	
None
    	
 
    	
None
    
	
Revolving Credit Agreement
    	
 
    	
4
    	
 
    	
4
    	
 
    	
1
    	
 
    	
4
    	
 
    	
4
    	
 
    	
4
    	
 
    	
None
    	
 
    	
None
    
	
New Second Lien Notes
    	
 
    	
2
    	
 
    	
2
    	
 
    	
3
    	
 
    	
2(3)
    	
 
    	
2
    	
 
    	
2
    	
 
    	
None
    	
 
    	
1
    


 




(2)       Collateral other than MT Account to be released once MT Account is fully funded with $200 million.

(3)       Recovery is capped at $200 million together with the New Third Lien Notes.

 











 

	
 
    	
 
    	
Term Priority
   Collateral
   (other than
   New Term
   Loan Priority
   Assets)
    	
 
    	
New Term
   Loan Priority
   Assets
    	
 
    	
ABL Priority
   Collateral
    	
 
    	
PropCo Assets
   and/or Equity
   Interests of
   PropCo
   (pre-call)
    	
 
    	
PropCo Assets
   and/or Equity
   Interests of
   PropCo
   (post-call)
    	
 
    	
Equity Interests
   of New
   Subsidiary
    	
 
    	
50% of Common
   Equity Interests
   of MT Issuer
    	
 
    	
Assets of
   MyTheresa
   Guarantor
   Entities
   (including
   MyTheresa
   Account)(2)
    
	
New Third Lien Notes
    	
 
    	
3
    	
 
    	
3
    	
 
    	
4
    	
 
    	
1(4)
    	
 
    	
3
    	
 
    	
3
    	
 
    	
1
    	
 
    	
None
    
	
Unsecured Notes (Cash Pay Notes   and PIK Toggle Notes) that do not tender in the Exchange Offer
    	
 
    	
None
    	
 
    	
None
    	
 
    	
None
    	
 
    	
None
    	
 
    	
None
    	
 
    	
None
    	
 
    	
None
    	
 
    	
None
    
	
7.125% Debentures due 2028
    	
 
    	
Pari Passu on assets   subject to “equal and ratable clause” set forth in the 2028 Debentures   Indenture.
    	
 
    	
Pari Passu on assets   subject to “equal and ratable clause” set forth in the 2028 Debentures   Indenture.
    	
 
    	
None
    	
 
    	
Pari Passu on assets   subject to “equal and ratable clause” set forth in the 2028 Debentures   Indenture.
    	
 
    	
Pari Passu on assets   subject to “equal and ratable clause” set forth in the 2028 Debentures   Indenture.
    	
 
    	
Pari Passu on assets   subject to “equal and ratable clause” set forth in the 2028 Debentures   Indenture.
    	
 
    	
None
    	
 
    	
None
    


 




(4)       Recovery is capped at $200 million together with the New Second Lien Notes.

 












 

EXHIBIT B

 

Form of Joinder

 

The undersigned (“Joinder Party”) hereby acknowledges that it has read and understands the Transaction Support Agreement, dated as of March 25, 2019 (the “Agreement”)(1) by and among Neiman Marcus Group, Inc. (“NMG”), the other Company Parties, and the Consenting Stakeholders and agrees to be bound by the terms and conditions of the Agreement to the extent the other Parties are thereby bound, and shall be deemed a “Consenting Stakeholder” and a “Party” under the terms of the Agreement.

 

The Joinder Party specifically agrees to be bound by the terms and conditions of the Agreement and makes all representations and warranties contained in the Agreement as of the date of this Form of Joinder and any further date specified in the Agreement.

 

	
Date   Executed:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Name:
    	
 
    
	
Title:
    	
 
    
	
 
    	
 
    
	
Address:
    	
 
    
	
 
    	
 
    
	
E-mail   address(es):
    	
 
    


 

	
Aggregate Amounts Beneficially   Owned or Managed on Account of:
    
	
Term Loan
    	
 
    
	
Cash Pay Notes
    	
 
    
	
PIK Toggle Notes
    	
 
    
	
Shares of Existing Common Stock
    	
 
    


 




(1)         Capitalized terms not used but not otherwise defined in this Form of Joinder shall have the meanings ascribed to such terms in the Agreement.

 











 

EXHIBIT C

 

Provision for Transfer Agreement

 

The undersigned (“Transferee”) hereby acknowledges that it has read and understands the Transaction Support Agreement, dated as of March 25, 2019 (the “Agreement”),(2) by and among Neiman Marcus Group, Inc. (“NMG”), the other Company Parties, and the Consenting Stakeholders, including the transferor to the Transferee of any Company Claims/Interests (each such transferor, a “Transferor”), and agrees to be bound by the terms and conditions of the Agreement to the extent the Transferor was bound, and shall be deemed a “Consenting Stakeholder” and a “Party” under the terms of the Agreement.

 

The Transferee specifically agrees to be bound by the terms and conditions of the Agreement and makes all representations and warranties contained in the Agreement as of the date of the Transfer, including the agreement to be bound by the vote of the Transferor if such vote was cast before the effectiveness of the Transfer discussed in this Transfer Agreement.

 

	
Date   Executed:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Name:
    	
 
    
	
Title:
    	
 
    
	
 
    	
 
    
	
Address:
    	
 
    
	
 
    	
 
    
	
E-mail   address(es):
    	
 
    


 

	
Aggregate   Amounts Beneficially Owned or Managed on Account of:
    
	
Term Loan
    	
 
    
	
Cash Pay Notes
    	
 
    
	
PIK Toggle Notes
    	
 
    
	
Shares of Existing Common Stock
    	
 
    


 




(2)         Capitalized terms not used but not otherwise defined in this Transfer Agreement shall have the meanings ascribed to such terms in the Agreement.

 











 

EXHIBIT D

 

Waiver, Rescission and Amendment under Term Loan Credit Agreement(1)

 

Section 1.                                          Temporary Waiver.  Without prejudice to any rights of any Loan Party (as defined in the Term Loan Credit Agreement) and without admission of any liability of the Loan Parties and solely during the Agreement Effective Period, the Company Parties and the Consenting Term Loan Lenders agree as follows:

 

1.01.                     to the extent any alleged Default or Event of Default has occurred or is continuing as a result of the Marble Ridge Litigation, including as a result of the filing of a complaint by Marble Ridge Capital LP and its related or affiliated funds which included a request for the appointment of a receiver under Texas state law (or any similar action or claim), all such Potential Challenges are temporarily waived for the duration of the Agreement Effective Period;

 

1.02.                     to the extent that, due to any Potential Challenge, any or all of the Obligations are due and payable, or during the Agreement Effective Period any or all of the Obligations become due and payable, in each case, pursuant to the final paragraph of Section 8.01 of the Term Loan Credit Agreement (in each case, a “Potential Acceleration”), such Potential Acceleration is and shall be deemed to be temporarily annulled, waived, and rescinded for all purposes under the Term Loan Credit Agreement and any other Loan Document, in each case solely for the duration of the Agreement Effective Period;

 

1.03.                     the agreements set forth in the foregoing Sections 1.01 and 1.02 are a limited and temporary waiver, solely for the duration of the Agreement Effective Period;

 

1.04.                     notwithstanding any other provision of the Term Loan Credit Agreement, immediately upon the occurrence of a Termination Event, the Temporary Waiver shall automatically terminate and be void ab initio and of no further force and effect without any further action or notice of any kind; and

 

1.05.                     notwithstanding any other provision of the Term Loan Credit Agreement, immediately upon the occurrence of a Termination Event, the Administrative Agent and the Lenders shall be free to exercise all rights and remedies available to them under the Term Loan Credit Agreement, any other Loan Document or applicable law (but only to the extent such rights and remedies are entitled to be exercised under the terms of such documents or law) in respect of any Potential Challenge and/or Potential Acceleration or otherwise, in each case, as if the Temporary Waiver had never been granted, each of which rights and remedies are reserved.

 

Section 2.                                          Amendments.  Effective as of the date that is one day prior to the first date that the Marble Ridge Litigation was filed in the District Court of Dallas County, Texas, section 8.01(8) of the Term Loan Credit Agreement shall be deemed amended and restated in its entirety as follows (with any deleted text indicated textually as: stricken text and any added text indicated textually

 




(1)         Capitalized terms used but not otherwise defined in this Agreement shall have the meaning ascribed to such terms in the Transaction Support Agreement (including the Recapitalization Term Sheet) or the Term Loan Credit Agreement (prior to giving effect to any amendments or modifications contemplated in this Agreement), as applicable.

 











 

as double-underlined text); provided, that if this Agreement is terminated other than in accordance with section 12.04(a), these amendments shall be stricken and ineffective, shall be of no further force or effect and shall be void ab initio:

 

(8)                                 an involuntary proceeding is commenced or an involuntary petition is filed in a court of competent jurisdiction seeking:

 

(a)                                 relief in respect of Holdings, the Borrower or any of the Material Subsidiaries, or of a substantial part of the property or assets of Holdings, the Borrower or any Material Subsidiary, under Title 11 of the United States Code, as now constituted or hereafter amended, or any other federal, state or foreign bankruptcy, insolvency, receivership or similar law and such proceeding or petition continues undischarged, undismissed or unstayed for 60 calendar days, or an order or decree approving or ordering any of the foregoing is entered;(2)

 

(b)                                 the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for Holdings, the Borrower or any of the Material Subsidiaries or for a substantial part of the property or assets of Holdings, the Borrower or any Restricted Subsidiary and such appointment occurs and continues undischarged, undismissed or unstayed for 60 calendar days from the date of such appointment; or

 

(c)                                  the winding up or liquidation of Holdings, the Borrower or any Material Subsidiary (except, in the case of any Material Subsidiary, in a transaction permitted by Section 6.05) and such proceeding or petition continues undischarged, undismissed or unstayed for 60 calendar days, or an order or decree approving or ordering any of the foregoing is entered;

 

Section 3.                                          Definitions.  As used in this Exhibit D, the following terms have the meanings specified below:

 

“Potential Challenge” means each such Default or Event of Default described in Section 1.01 of this Exhibit D (or any similar action or claim).

 

“Temporary Waiver” means the agreements set forth in Sections 1.01, 1.02 and 1.03 of this Exhibit D.

 

“Termination Event” means the occurrence of any termination of the Transaction Support Agreement in accordance with its terms.  “Termination Event” as used with respect to any such termination pursuant to Section 12.01 of the Transaction Support Agreement shall only mean a termination by the Required Consenting Term Loan Lenders.

 




(2)  For the avoidance of doubt, bolded and underlined language included in this draft shows changes to the existing language.