Slide 1: Rebuttal Deck: Vote the WHITE Proxy Card
APRIL 2022 REBUTTAL DECK: ✓ CHERRY-PICKING TIME PERIODS, PEER GROUPS & METRICS DOESN’T CHANGE THE FACTS ✓ FOCUS ON THE FACTS — NOT ‘HYPOTHETICAL’ ADJUSTMENTS VOTE THE WHITE PROXY CARD
Slide 2: Disclaimer
DISCLAIMER The materials contained herein (the “Materials”) represent the opinions of Macellum Badger Fund, LP and the other participants named in this proxy solicitation (collectively, “Macellum”) and are based on publicly available information with respect to Kohl's Corporation (the “Company”). Ma
Slide 3: Kohl's Faces Significant Risk If Macellum's Nominees Are Not Elected
KOHL’S FACES SIGNIFICANT RISK IF MACELLUM’S NOMINEES ARE NOT ELECTED Kohl’s’ Investor Presentation includes misleading adjustments, cherry-picked timeframes and new peer groups • Kohl’s creates a hypothetical undisturbed share price (“HUSP”) of $56.08 by adjusting its stock price 20% higher from a p
Slide 4: Kohl's Claim of a $56.08 Hypothetical Undisturbed Share Price Is Misleading
KOHL’S’ CLAIM OF A $56.08 HYPOTHETICAL UNDISTURBED SHARE PRICE IS MISLEADING Put simply, the Company’s adjustment to its pre-takeover bid stock price ignores the facts The Kohl’s Board adjusts the stock 20% higher from the pre-takeover price ($46.84) based on the performance of Dillard’s, Macy’s and
Slide 5: Without the Pressure of Macellum, Would Kohl's Have Even Explored Strategic Bids?
WITHOUT THE PRESSURE OF MACELLUM, WOULD KOHL’S HAVE EVEN EXPLORED STRATEGIC BIDS? We contend without the election of Macellum’s nominees, there is significant risk to the sale process After the markets close, The Macellum issues a press Wall Street Journal reports release detailing concerns that tha
Slide 6: Kohl's Positive TSR Claim Cherry-Picks Dates and Peer Groups
KOHL’S’ POSITIVE TSR CLAIM CHERRY-PICKS DATES AND PEER GROUPS In addition to neglecting obvious facts when creating a fictional “HUSP” for the ending price, Kohl’s chooses to show the only timeframe, among many, that it might have outperformed. Further, the Company cherry picked a 5 year TSR end dat
Slide 7: Kohl's Actual Underperformance Across a Multitude of Timeframes and Peer Groups
KOHL’S’ ACTUAL UNDERPERFORMANCE ACROSS A MULTITUDE OF TIMEFRAMES AND PEER GROUPS Our more appropriate timeframe (ending with 01/21/2022), excluding “hypothetical” adjustments, highlights how Kohl’s underperformed across multiple time periods 1-YEAR TSR SINCE PRE-COVID (12/31/2019) TSR 105% 86% 85% 1
Slide 8: Kohl's Now Uses Dillard's as a Direct Peer But Not in Its Proxy Peer Groups
KOHL’S NOW USES DILLARD’S AS A DIRECT PEER, BUT DOES NOT INCLUDE IT IN ITS COMPENSATION OR PERFORMANCE PEER GROUPS IN ITS PROXY Macellum has always included Dillard’s as a peer We are confused as to why Kohl’s has only recently decided that Dillard’s is a direct peer when it is neither in its compen
Slide 9: Kohl's EBITDA Growth Has Materially Lagged Peers
KOHL’S’ EBITDA GROWTH HAS MATERIALLY LAGGED PEERS Kohl’s misleadingly displays its average five-year EBITDA margin of 11.9%, however, the Company neglects to point out that peers have grown EBITDA dollars significantly while Kohl’s’ EBITDA has declined EBITDA 2017 vs. 2022E1 ($ in millions) $3,500 $
Slide 10: Kohl's Touts Outperformance vs. Consensus During 2021 as the Economy Reopened
KOHL’S TOUTS OUTPERFORMANCE VS. CONSENSUS DURING 2021 AS THE ECONOMY REOPENED Kohl’s significantly underperformed retail peers’ EBIT and revenue growth from FY 2019 to FY 2021 The Company continuously took credit for beating the consensus as the economy reopened, when in reality, Kohl’s was not able
Slide 11: Kohl's TSR Peer Group Uses Many Companies That Are Not Appropriate
KOHL’S’ TSR PEER GROUP USES MANY COMPANIES THAT ARE NOT APPROPRIATE Kohl’s’ TSR peer group includes other retailers that Macellum does not believe are the most relevant: • Abercrombie & Fitch Co. (ANF) - 30% of its sales are international • Carter’s Inc (CRI) - 33% of its sales are wholesale and 12%
Slide 12: Kohl's Touts Its EPS Growth While Neglecting Its Operating Deterioration
KOHL’S TOUTS ITS EPS GROWTH WHILE NEGLECTING ITS OPERATING DETERIORATION Kohl’s touts its three-year plan while using fiscal 2022 as the starting point and overlooks the EBIT declines from fiscal 2021 • Kohl’s’ financial framework misleadingly touts EPS growth of mid-to-high single digits • Only in
Slide 13: Kohl's Appears to Lack Understanding of a Sale Leaseback Transaction
KOHL’S APPEARS TO LACK UNDERSTANDING OF A SALE LEASEBACK TRANSACTION • In Kohl’s’ sale leaseback assessment, the Board fails to understand a basic premise: a sale leaseback does NOT create debt which must be paid back, nor does it materially impair valuation • It should be noted that all of the repo
Slide 14: Kohl's Misrepresented Macellum's Performance
KOHL’S MISREPRESENTED MACELLUM’S PERFORMANCE Macellum’s campaigns have created significant value for shareholders. TSR During Our Tenure 1 Macellum drove significant shareholder value accomplished through a $725 million sale 135% leaseback. Big Lots, unfortunately, chose to remove Macellum’s nominee