Neiman Marcus 2008 Annual Report Download - page 364

any Subsidiary to grant a security interest in (i) any Equity Interests of a Subsidiary to the extent a pledge of such Equity Interests in
favor of the Agent or to secure any debt securities of the Borrower or any Subsidiary that would be entitled to such a security interest
would require separate financial statements of a Subsidiary to be filed with the SEC (or any other government agency) under
Rule 3-10 or Rule 3-16 of Regulation S-X under the Securities Act (or any successor thereto) or any other law, rule or regulation or
(ii) the Equity Interests of any Unrestricted Subsidiary.
(c) Without limiting the foregoing, each Loan Party will, and will cause each Subsidiary that is a Loan Party to,
execute and deliver, or cause to be executed and delivered, to the Agent such documents, agreements and instruments, and will take or
cause to be taken such further actions (including the filing and recording of financing statements, fixture filings, mortgages, deeds of
trust and other documents and such other actions or deliveries of the type required by Article IV, as applicable (including the delivery
of the items contemplated by paragraph (m) thereof to the extent the Borrower has been unable to deliver such items by the Closing
Date after having used its commercially reasonable efforts to obtain and deliver such items by the Closing Date)), which may be
required by law or which the Agent may, from time to time, reasonably request to carry out the terms and conditions of this
Agreement and the other Loan Documents and to ensure perfection and priority of the Liens created or intended to be created by the
Collateral Documents, all at the expense of the Loan Parties.
(d) Subject to the limitations set forth or referred to in this Section 5.11, if any material assets (including any real
property or improvements thereto or any interest therein) are acquired by the Borrower or any Subsidiary that is a Loan Party after the
Closing Date (other than assets constituting Collateral under the Security Agreement that become subject to the Lien in favor of the
Agent upon acquisition thereof), the Borrower will notify the Agent and the Lenders thereof, and, if requested by the Agent or the
Required Lenders, the Borrower will cause such assets to be subjected to a Lien securing the Secured Obligations and will take, and
cause the Loan Parties that are Subsidiaries to take, such actions as shall be necessary or reasonably requested by the Agent to grant
and perfect such Liens, including actions described in paragraph (c) of this Section, all at the expense of the Loan Parties.
(e) If, at any time and from time to time after the Closing Date, Subsidiaries that are not Loan Parties because they
are Immaterial Subsidiaries comprise in the aggregate more than 5% of Total Assets as of the end of the most recently ended fiscal
quarter of the Borrower or more than 5% of EBITDA of the Borrower and the Restricted Subsidiaries for the period of four
consecutive fiscal quarters as of the end of the most recently ended fiscal quarter of the Borrower, then the Borrower shall, not later
than 45 days after the date by which financial statements for such quarter are required to be delivered pursuant to this Agreement,
cause one or more such Subsidiaries to become additional Loan Parties (notwithstanding that such Subsidiaries are, individually,
Immaterial Subsidiaries) such that the foregoing condition ceases to be true.
(f) Notwithstanding anything to the contrary in this Section 5.11, real property required to be mortgaged under this
Section 5.11 shall be limited to real property located in the U.S. that are full-line Neiman Marcus retail stores owned in fee by a Loan
Party or leased by a Loan Party pursuant to a financeable lease or other real property owned in fee by a Loan Party having a fair
market value at the time of the acquisition thereof of $5,000,000 or more (provided that the cost of perfecting such Lien is not
unreasonable in relation to the benefits to the Lenders of the security afforded thereby in the Agent's reasonable judgment after
consultation with the Borrower; provided further that the Borrower shall use commercially reasonable efforts to ensure that all leases
entered into after the Closing Date by the Borrower and the other Loan Parties will be financeable leases).
(g) Notwithstanding anything to the contrary contained herein, the Loan Parties shall not be required to include as
Collateral any Excluded Assets (as defined in the Security Agreement).
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