UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
SCHEDULE
13E-3
RULE
13E-3 TRANSACTION STATEMENT UNDER SECTION 13(E)
OF
THE SECURITIES EXCHANGE ACT OF 1934
NORDSTROM,
INC.
(Name
of the Issuer)
Nordstrom,
Inc.
Norse
Holdings, Inc.
Navy
Acquisition Co. Inc.
El
Puerto de Liverpool, S.A.B. de C.V.
Anne
E. Gittinger
Anne
E. Gittinger Trust u/w Everett W. Nordstrom
1976
Elizabeth J. Nordstrom Trust FBO Anne Gittinger
Charles
W. Riley, Jr., solely in his capacity as trustee of Anne E. Gittinger Trust u/w Everett W. Nordstrom and as co-trustee of
Trust
A u/w Frances W. Nordstrom and not in any individual capacity
Estate
of Bruce A. Nordstrom
1976
Bruce A. Nordstrom Trust (aka 1976 Elizabeth J. Nordstrom Trust FBO Bruce A. Nordstrom)
Trust
A u/w Frances W. Nordstrom
Margaret
Jean O'Roark Nordstrom, in her capacity as co-executor of the Estate of Bruce A. Nordstrom
Peter
E. Nordstrom
Erik
B. Nordstrom
James
F. Nordstrom, Jr.
Katharine
T. Nordstrom 2007 Trust Agreement
Julia
K. Nordstrom 2007 Trust Agreement
Audrey
G. Nordstrom 2007 Trust Agreement
Erik
and Julie Nordstrom 2012 Sara D. Nordstrom Trust
Bruce
and Jeannie Nordstrom 2010 MFN Trust
Pete
and Brandy Nordstrom 2010 MFN Trust
Bruce
and Jeannie Nordstrom 2012 CFN Trust
Pete
and Brandy Nordstrom 2012 CFN Trust
Pete
and Brandy Nordstrom 2012 Children’s Trust
(Names
of Persons Filing Statement)
Common
Stock, without par value
(Title
of Class of Securities)
655664100
(CUSIP
Number of Class of Securities)
Nordstrom,
Inc.
1617 Sixth Avenue
Seattle, Washington 98101
Tel: (206) 628-2111 |
|
Norse
Holdings, Inc.
Navy Acquisition Co. Inc.
Anne
E. Gittinger
Anne
E. Gittinger Trust u/w Everett W. Nordstrom
1976
Elizabeth J. Nordstrom Trust FBO Anne Gittinger
Charles
W. Riley, Jr., solely in his capacity as trustee of Anne E. Gittinger Trust u/w Everett W. Nordstrom and as co-trustee of Trust A
u/w Frances W. Nordstrom and not in any individual capacity
Estate
of Bruce A. Nordstrom
1976
Bruce A. Nordstrom Trust (aka 1976 Elizabeth J. Nordstrom Trust FBO Bruce A. Nordstrom)
Trust
A u/w Frances W. Nordstrom
Margaret
Jean O'Roark Nordstrom, in her capacity as co-executor of the Estate of Bruce A. Nordstrom
Peter
E. Nordstrom
Erik
B. Nordstrom
James
F. Nordstrom, Jr.
Katharine
T. Nordstrom 2007 Trust Agreement
Julia
K. Nordstrom 2007 Trust Agreement
Audrey
G. Nordstrom 2007 Trust Agreement
Erik
and Julie Nordstrom 2012 Sara D. Nordstrom Trust
Bruce
and Jeannie Nordstrom 2010 MFN Trust
Pete
and Brandy Nordstrom 2010 MFN Trust
Bruce
and Jeannie Nordstrom 2012 CFN Trust
Pete
and Brandy Nordstrom 2012 CFN Trust
Pete
and Brandy Nordstrom 2012 Children’s Trust
c/o Nordstrom, Inc.
1617 Sixth Avenue
Seattle, Washington 98101
Tel: (206) 628-2111 |
|
El
Puerto de Liverpool, S.A.B. de C.V.
Mario Pani No. 200,
Col.
Santa Fe, Del. Cuajimalpa
CDMX
C.P. 05348
Tel: 52-55-5268-3000 |
(Name,
Address, and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of the Persons Filing Statement)
With
copies to:
Derek
Zaba
Sidley Austin LLP
1001 Page Mill Road,
Building
1
Palo Alto, CA 94304
Tel: (650) 565-7000 |
|
Gary
Gerstman
Scott
Williams
Sidley Austin LLP
One South Dearborn
Chicago, IL 60603
Tel: (312) 853-7000 |
|
Keith
Trammell
Michael
Gilligan
Glenn
R. Pollner
Wilmer Cutler Pickering
Hale & Dorr LLP
7 World Trade Center
250
Greenwich Street
New York, NY 10007
Tel: (212) 295-6329 |
|
Benjamin
P. Schaye
Juan
F. Méndez
Benjamin
A. Bodurian
Simpson
Thacher & Bartlett LLP
425 Lexington Avenue
New York, NY 10017
Tel: (212) 455-7866 |
This
statement is filed in connection with (check the appropriate box):
| a. |
☒ |
The
filing of solicitation materials or an information statement subject to Regulation 14A, Regulation 14C or Rule 13e-3(c) under the
Securities Exchange Act of 1934. |
| b. |
☐ |
The
filing of a registration statement under the Securities Act of 1933. |
| c. |
☐ |
A
tender offer. |
| d. |
☐ |
None
of the above. |
Check
the following box if the soliciting materials or information statement referred to in checking box (a) are preliminary copies: ☒
Check
the following box if the filing is a final amendment reporting the results of the transaction: ☐
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of this transaction, passed upon
the merits or fairness of this transaction, or passed upon the adequacy or accuracy of the disclosure in this transaction statement on
Schedule 13E-3. Any representation to the contrary is a criminal offense.
TABLE
OF CONTENTS
INTRODUCTION
This
Transaction Statement on Schedule 13E-3 (this “Transaction Statement”) is being filed with the U.S. Securities and
Exchange Commission (the “SEC”) pursuant to Section 13(e) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), jointly by the following persons (each, a “Filing Person,” and collectively, the
“Filing Persons”): (1) Nordstrom, Inc., a Washington corporation (“Nordstrom”) and the issuer of
the Nordstrom common stock, no par value per share (the “Nordstrom Common Stock”), that is the subject of the Rule
13e-3 transaction; (2) Norse Holdings, Inc., a Delaware corporation (“Parent”); (3) Navy Acquisition Co. Inc., a Washington
corporation and wholly owned subsidiary of Parent (“Acquisition Sub”); (4) El Puerto de Liverpool, S.A.B. de C.V.,
a Mexican corporation (sociedad anónima bursátil) (“Liverpool”); and (5) Anne E. Gittinger, Anne
E. Gittinger Trust u/w Everett W. Nordstrom, 1976 Elizabeth J. Nordstrom Trust FBO Anne Gittinger, Charles W. Riley, Jr., solely in his
capacity as trustee of Anne E. Gittinger Trust u/w Everett W. Nordstrom and as co-trustee of Trust A u/w Frances W. Nordstrom and not
in any individual capacity, Estate of Bruce A. Nordstrom, 1976 Bruce A. Nordstrom Trust (aka 1976 Elizabeth J. Nordstrom Trust FBO Bruce
A. Nordstrom), Trust A u/w Frances W. Nordstrom, Margaret Jean O'Roark Nordstrom, in her capacity as co-executor of the Estate of Bruce
A. Nordstrom, Peter E. Nordstrom, Erik B. Nordstrom, James F. Nordstrom, Jr., Katharine T. Nordstrom 2007 Trust Agreement, Julia K. Nordstrom
2007 Trust Agreement, Audrey G. Nordstrom 2007 Trust Agreement, Erik and Julie Nordstrom 2012 Sara D. Nordstrom Trust, Bruce and Jeannie
Nordstrom 2010 MFN Trust, Pete and Brandy Nordstrom 2010 MFN Trust, Bruce and Jeannie Nordstrom 2012 CFN Trust, Pete and Brandy Nordstrom
2012 CFN Trust and Pete and Brandy Nordstrom 2012 Children’s Trust.
This
Transaction Statement relates to the Agreement and Plan of Merger, dated December 22, 2024 (including all exhibits and documents attached
thereto, and as it may be amended, supplemented or modified, from time to time, the “Merger Agreement”), by and among
Nordstrom, Parent and Acquisition Sub. The Merger Agreement provides that, subject to the terms and conditions set forth in the Merger
Agreement, Acquisition Sub will merge with and into Nordstrom (the “Merger”), with Nordstrom surviving the Merger
and becoming a wholly owned subsidiary of Parent.
At
the effective time of the Merger (the “Effective Time”), each share of Nordstrom Common Stock issued and outstanding
as of immediately prior to the Effective Time (other than shares of Nordstrom Common Stock that are (i) held by Nordstrom or owned of
record by Nordstrom or any of its subsidiaries, (ii) held, directly or indirectly, by Parent or Acquisition Sub or any of their wholly-owned
subsidiaries (other than, in each case of clauses (i) and (ii), shares held on behalf of a third party), (iii) to be contributed
to Parent pursuant to the Rollover and Support Agreements (as defined below) or (iv) held by a person who has not voted in favor of or
consented to the approval of the Merger Agreement and the Merger and has complied with all other provisions of the Washington Business
Corporation Act, as amended, concerning dissenters’ rights with respect to the Merger Agreement) will be cancelled and automatically
converted into the right to receive the merger consideration of $24.25 per share in cash, without interest thereon, subject to any required
tax withholding in accordance with the terms of the Merger Agreement. In addition, the Nordstrom Board of Directors (the “Nordstrom
Board”) intends to authorize a special dividend of up to $0.25 per share (based on the amount of available cash on hand of
Nordstrom and its subsidiaries) prior to and contingent on the close of the Merger. Following the Merger, Nordstrom Common Stock will
no longer be publicly traded, and Nordstrom’s shareholders (other than the Family Group (as defined in the Proxy Statement (as
defined herein)) and Liverpool, indirectly through Parent) will cease to have any ownership interest in Nordstrom.
In
connection with entering into the Merger Agreement, on December 22, 2024, Parent and Nordstrom entered into rollover, voting and support
agreements with the Family Group and Liverpool (together, the “Rollover and Support Agreements”). Pursuant to the
Rollover and Support Agreements, the Family Group and Liverpool agreed to vote all of their shares of Nordstrom Common Stock in favor
of the approval of the Merger Agreement and the transactions contemplated thereby, including the Merger, in favor of any proposal by
Nordstrom to adjourn, recess or postpone any meeting of the shareholders to a later date that complies with the Merger Agreement, in
favor of any other proposal considered and voted upon by shareholders of Nordstrom necessary for the consummation of the Merger and the
other transactions contemplated by the Merger Agreement, and against any other proposal that would reasonably be expected to result in
any of the conditions to the consummation of the Merger under the Merger Agreement not being fulfilled or impede, frustrate, interfere
with, delay, postpone or adversely affect the Merger and the other transactions contemplated by the Merger Agreement. In addition, the
Family Group and Liverpool agreed pursuant to the Rollover and Support Agreements to transfer, contribute and deliver to Parent certain
shares of Nordstrom Common Stock in exchange for a number of newly issued shares of common stock of Parent, subject to the substantially
simultaneous, but subsequent, consummation of the Merger in accordance with the terms of the Merger Agreement.
The
Nordstrom Board formed a special committee (the “Special Committee”) to consider and evaluate the advisability of
an acquisition by one or more persons of all of the outstanding shares of Nordstrom Common Stock (except for shares owned by one or more
shareholders who are retaining their interests), and any alternative transaction to a potential transaction that the Special Committee
deems appropriate, and delegated to the Special Committee certain powers of the Nordstrom Board with respect to a potential transaction
and any alternative transaction. The Special Committee is composed solely of members of the Nordstrom Board who are independent of and
disinterested with respect to the Family Group, Liverpool, the Merger Agreement and the transactions contemplated thereby. The Special
Committee, as more fully described in the preliminary Proxy Statement, evaluated the Merger, with the assistance of its own independent
financial and legal advisors. After careful consideration, the Special Committee, pursuant to resolutions adopted at a meeting of the
Special Committee held on December 22, 2024, unanimously (1) determined and declared that the Merger Agreement and the consummation by
Nordstrom of the transactions contemplated thereby, including the Merger, are advisable, fair to and in the best interests of Nordstrom
and its shareholders and (2) recommended that the Nordstrom Board, among other things, approve the Merger Agreement and, subject to receiving
the Requisite Shareholder Approvals (as defined herein), the consummation of the transactions contemplated thereby, including the Merger,
and recommend the approval of the Merger Agreement and the transactions contemplated thereby, including the Merger, by Nordstrom’s
shareholders.
The
Nordstrom Board, acting on the unanimous recommendation of the Special Committee, unanimously (with Messrs. Erik and Peter Nordstrom
recusing themselves), among other things, (1) determined and declared that the Merger Agreement and the consummation by Nordstrom of
the transactions contemplated thereby, including the Merger, are advisable, fair to and in the best interests of Nordstrom and its shareholders,
(2) approved the Merger Agreement and, subject to receiving the Requisite Shareholder Approvals, the consummation of the transactions
contemplated thereby, including the Merger, and (3) upon the terms and subject to the conditions of the Merger Agreement, resolved to
recommend the approval of the Merger Agreement and the transactions contemplated thereby, including the Merger, by Nordstrom’s
shareholders.
The
Merger cannot be consummated without the affirmative vote of (1) the holders of shares of Nordstrom Common Stock representing two-thirds
of the outstanding shares of Nordstrom Common Stock entitled to vote thereon at the Special Meeting and (2) the holders of shares of
Nordstrom Common Stock representing a majority of the outstanding shares of Nordstrom Common Stock entitled to vote thereon at the Special
Meeting other than shares owned, directly or indirectly, by Parent, Acquisition Sub, the Family Group, Liverpool and their respective
affiliates or by any director or officer (within the meaning of Rule 16a-1(f) of the Exchange Act) of Nordstrom (together the “Requisite
Shareholder Approvals”).
Concurrently
with the filing of this Transaction Statement, Nordstrom is filing a proxy statement (the “Proxy Statement”) under
Regulation 14A of the Exchange Act with the SEC, pursuant to which Nordstrom is soliciting proxies from Nordstrom’s shareholders
in connection with the Merger. The Proxy Statement is attached hereto as Exhibit (a)(1). A copy of the Merger Agreement is attached to
the Proxy Statement as Annex A. As of the date hereof, the Proxy Statement is in preliminary form, and is subject to completion or amendment.
Pursuant
to General Instruction F to Schedule 13E-3, the information in the Proxy Statement, including all annexes thereto, is expressly incorporated
by reference herein in its entirety, and responses to each item herein are qualified in their entirety by the information contained in
the Proxy Statement. The cross-references below are being supplied pursuant to General Instruction G to Schedule 13E-3 and show the location
in the Proxy Statement of the information required to be included in response to the items of Schedule 13E-3.
While
each of the Filing Persons acknowledges that the Merger may be deemed to constitute a “going private” transaction for purposes
of Rule 13e-3 under the Exchange Act, the filing of this Transaction Statement shall not be construed as an admission by any Filing Person,
or by any affiliate of a Filing Person, that Nordstrom is “controlled” by any of the Filing Persons and/or their respective
affiliates.
The
information concerning Nordstrom contained in, or incorporated by reference into, this Transaction Statement and the Proxy Statement
was supplied by Nordstrom. Similarly, all information concerning each other Filing Person contained in, or incorporated by reference
into, this Transaction Statement and the Proxy Statement was supplied by such Filing Person. No Filing Person, including Nordstrom, is
responsible for the accuracy of any information supplied by any other Filing Person.
SCHEDULE
13E-3 ITEMS
Item
1. Summary Term Sheet
The
information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
Item
2. Subject Company Information
| (a) | Name
and address. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference: |
| ● | “Summary
Term Sheet—The Parties to the Merger—Nordstrom” |
| | | |
| | ● | “Questions
and Answers” |
| ● | “The
Parties to the Merger—Nordstrom” |
| ● | “Important
Information Regarding Nordstrom” |
| (b) | Securities.
The information set forth in the Proxy Statement under the following captions is incorporated
herein by reference: |
| ● | “Summary
Term Sheet—The Special Meeting—Record Date; Shares Entitled to Vote; Quorum” |
| | | |
| | ● | “Questions
and Answers” |
| ● | “The
Special Meeting—Record Date; Shares Entitled to Vote; Quorum” |
| ● | “Important
Information Regarding Nordstrom—Security Ownership of Certain Beneficial Owners and
Management” |
| (c) | Trading
market and price. The information set forth in the Proxy Statement under the following
caption is incorporated herein by reference: |
| ● | “Important
Information Regarding Nordstrom—Market Price of Nordstrom Common Stock” |
| (d) | Dividends.
The information set forth in the Proxy Statement under the following caption is incorporated
herein by reference: |
| ● | “The
Merger Agreement—Special Dividend and Stub Period Dividend” |
| ● | “The
Merger Agreement—Covenants Regarding Conduct of Business by Nordstrom Prior to the
Merger” |
| ● | “Important
Information Regarding Nordstrom—Dividends” |
| (e) | Prior
public offerings. The information set forth in the Proxy Statement under the following
caption is incorporated herein by reference: |
| ● | “Important
Information Regarding Nordstrom—Prior Public Offerings” |
| (f) | Prior
stock purchases. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference: |
| ● | “Important
Information Regarding Nordstrom—Prior Public Offerings” |
| ● | “Important
Information Regarding Nordstrom—Transactions in Nordstrom Common Stock” |
Item
3. Identity and Background of Filing Person
(a)
— (c) Name and address; Business and background of entities; Business and background of natural persons. The information
set forth in the Proxy Statement under the following captions is incorporated herein by reference:
| ● | “Summary
Term Sheet—The Parties to the Merger—Parent” |
| ● | “Summary
Term Sheet—The Parties to the Merger—Acquisition Sub” |
| ● | “The
Parties to the Merger—Parent Entities” |
| ● | “Important
Information Regarding Nordstrom” |
| ● | “Important
Information Regarding the Parent Filing Parties” |
Item
4. Terms of the Transaction
| (a) | (1)
Material terms. Tender offers. Not applicable |
| (2) | Material
terms. Mergers or similar transactions. The information set forth in the Proxy Statement
under the following captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Plans for Nordstrom After the Merger” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Benefits of the Merger for the Unaffiliated Security Holders” |
| ● | “Special
Factors—Detriments of the Merger to the Unaffiliated Security Holders” |
| | | |
| | ● | “Special
Factors—Certain Effects of the Merger for the Parent Filing Parties” |
| ● | “Special
Factors—Certain Effects on Nordstrom if the Merger is Not Consummated” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—Intent of Nordstrom’s Directors and Executive Officers to Vote in Favor
of the Merger” |
| ● | “Special
Factors—Intent of Certain Shareholders to Vote in Favor of the Merger” |
| | | |
| | ● | “Special
Factors—Accounting Treatment” |
| ● | “Special
Factors—U.S. Federal Income Tax Considerations of the Merger” |
| ● | “The
Special Meeting—Votes Required” |
| ● | “The
Merger Agreement—Merger Consideration” |
| ● | “The
Merger Agreement—Exchange Procedures” |
| ● | “The
Merger Agreement—Conditions to the Merger” |
| ● | Annex
A—Agreement and Plan of Merger |
| (c) | Different
terms. The information set forth in the Proxy Statement under the following captions
is incorporated herein by reference: |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Benefits of the Merger for the Unaffiliated Security Holders” |
| ● | “Special
Factors—Detriments of the Merger to the Unaffiliated Security Holders” |
| ● | “Special
Factors—Certain Effects of the Merger for the Parent Filing Parties” |
| ● | “Special
Factors—Certain Effects on Nordstrom if the Merger is Not Consummated” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—Financing of the Merger” |
| ● | “Special
Factors—Limited Guaranties” |
| ● | “Special
Factors—Intent of Certain Shareholders to Vote in Favor of the Merger” |
| ● | “The
Merger Agreement—Merger Consideration” |
| ● | “The
Merger Agreement—Exchange Procedures” |
| ● | “The
Merger Agreement—Directors’ & Officers’ Indemnification and Insurance” |
| ● | “The
Merger Agreement—Employee Benefits” |
| ● | “The
Rollover and Support Agreements” |
| ● | “Proposal
2: The Compensation Proposal” |
| ● | Annex
A—Agreement and Plan of Merger |
| ● | Annex
D—Rollover, Voting and Support Agreement (Family Group) |
| ● | Annex
E— Rollover, Voting and Support Agreement (Liverpool) |
| (d) | Appraisal
rights. The information set forth in the Proxy Statement under the following captions
is incorporated herein by reference: |
| ● | “Summary
Term Sheet—Dissenters’ Rights” |
| ● | “The
Special Meeting—Dissenters’ Rights” |
| ● | “The
Merger Agreement—Dissenting Shares” |
| (e) | Provisions
for unaffiliated security holders. The information set forth in the Proxy Statement
under the following captions is incorporated herein by reference: |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Provisions
for Unaffiliated Company Shareholders” |
| (f) | Eligibility
for listing or trading. Not applicable. |
Item
5. Past Contacts, Transactions, Negotiations and Agreements
| (a) | (1)–(2)
Transactions. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger for the Parent Filing Parties” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—Intent of Certain Shareholders to Vote in Favor of the Merger” |
| ● | “Special
Factors—Financing of the Merger” |
| ● | “Special
Factors—Limited Guaranties” |
| ● | “Special
Factors—Fees and Expenses” |
| ● | “The
Rollover and Support Agreements” |
| ● | “Important
Information Regarding Nordstrom—Prior Public Offerings” |
| ● | “Important
Information Regarding Nordstrom—Transactions in Nordstrom Common Stock” |
| ● | “Important
Information Regarding Nordstrom—Past Contracts, Transactions, Negotiations and Agreements” |
| ● | “Important
Information Regarding the Parent Filing Parties” |
| ● | “Proposal
2: The Compensation Proposal” |
| ● | Annex
A—Agreement and Plan of Merger |
| ● | Annex
D—Rollover, Voting and Support Agreement (Family Group) |
| ● | Annex
E—Rollover, Voting and Support Agreement (Liverpool) |
| (b) | —
(c) Significant corporate events; Negotiations or contacts. The information
set forth in the Proxy Statement under the following captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—Limited Guaranties” |
| ● | “The
Rollover and Support Agreements” |
| ● | “Important
Information Regarding Nordstrom—Transactions in Nordstrom Common Stock” |
| ● | “Important
Information Regarding Nordstrom—Past Contracts, Transactions, Negotiations and Agreements” |
| ● | Annex
A—Agreement and Plan of Merger |
| ● | Annex
D—Rollover, Voting and Support Agreement (Family Group) |
| ● | Annex
E—Rollover, Voting and Support Agreement (Liverpool) |
| (e) | Agreements
involving the subject company’s securities. The information set forth in the
Proxy Statement under the following captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger for the Parent Filing Parties” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—Intent of Nordstrom’s Directors and Executive Officers to Vote in Favor
of the Merger” |
| ● | “Special
Factors—Intent of Certain Shareholders to Vote in Favor of the Merger” |
| ● | “Special
Factors—Financing of the Merger” |
| ● | “Special
Factors—Limited Guaranties” |
| ● | “Special
Factors—Fees and Expenses” |
| ● | “The
Special Meeting—Votes Required” |
| ● | “The
Rollover and Support Agreements” |
| ● | “Proposal
2: The Compensation Proposal” |
| ● | Annex
A—Agreement and Plan of Merger |
| ● | Annex
D—Rollover, Voting and Support Agreement (Family Group) |
| ● | Annex
E—Rollover, Voting and Support Agreement (Liverpool) |
Item
6. Purposes of the Transaction and Plans or Proposals
| (b) | Use
of securities acquired. The information set forth in the Proxy Statement under the
following captions is incorporated herein by reference: |
| ● | “Special
Factors—Plans for Nordstrom After the Merger” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger for the Parent Filing Parties” |
| ● | “Special
Factors—Certain Effects on Nordstrom if the Merger is Not Consummated” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—Financing of the Merger” |
| ● | “Special
Factors—Delisting and Deregistration of Nordstrom Common Stock” |
| ● | “The
Merger Agreement—Effect of the Merger” |
| ● | “The
Merger Agreement—Articles of Incorporation and Bylaws; Board of Directors and Officers” |
| ● | “The
Merger Agreement—Merger Consideration” |
| ● | “The
Merger Agreement—Exchange Procedures” |
| ● | “The
Merger Agreement—Treatment of Outstanding Equity Awards and Equity Plans” |
| ● | Annex
A—Agreement and Plan of Merger |
| (c) | (1)
— (8) Plans. The information set forth in the Proxy Statement under the
following captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Opinion of Morgan Stanley & Co. LLC to the Special Committee” |
| ● | “Special
Factors—Opinion of Centerview Partners LLC to the Special Committee” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Plans for Nordstrom After the Merger” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger for the Parent Filing Parties” |
| ● | “Special
Factors—Certain Effects on Nordstrom if the Merger is Not Consummated” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—Intent of Nordstrom’s Directors and Executive Officers to Vote in Favor
of the Merger” |
| ● | “Special
Factors—Intent of Certain Shareholders to Vote in Favor of the Merger” |
| ● | “Special
Factors—Financing of the Merger” |
| ● | “Special
Factors—Delisting and Deregistration of Nordstrom Common Stock” |
| ● | “The
Merger Agreement—Effect of the Merger” |
| ● | “The
Merger Agreement—Articles of Incorporation and Bylaws; Board of Directors and Officers” |
| ● | “The
Merger Agreement—Merger Consideration” |
| ● | “The
Merger Agreement—Special Dividend and Stub Period Dividend” |
| ● | “The
Merger Agreement—Directors’& Officers’ Indemnification and Insurance” |
| ● | “The
Merger Agreement—Employee Benefits” |
| ● | “The
Rollover and Support Agreements” |
| ● | “Important
Information Regarding Nordstrom—Dividends” |
| ● | Annex
A—Agreement and Plan of Merger |
| ● | Annex
B—Opinion of Morgan Stanley |
| ● | Annex
C—Opinion of Centerview Partners |
Item
7. Purposes, Alternatives, Reasons and Effects
| (a) | Purposes.
The information set forth in the Proxy Statement under the following captions is incorporated
herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Opinion of Morgan Stanley & Co. LLC to the Special Committee” |
| ● | “Special
Factors—Opinion of Centerview Partners LLC to the Special Committee” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Plans for Nordstrom After the Merger” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger for the Parent Filing Parties” |
| ● | Annex
B—Opinion of Morgan Stanley |
| ● | Annex
C—Opinion of Centerview Partners |
| (b) | Alternatives.
The information set forth in the Proxy Statement under the following captions is incorporated
herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Plans for Nordstrom After the Merger” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Certain Effects on Nordstrom if the Merger is Not Consummated” |
| (c) | Reasons.
The information set forth in the Proxy Statement under the following captions is incorporated
herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Opinion of Morgan Stanley & Co. LLC to the Special Committee” |
| ● | “Special
Factors—Opinion of Centerview Partners LLC to the Special Committee” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Plans for Nordstrom After the Merger” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger for the Parent Filing Parties” |
| ● | “Special
Factors—Certain Effects on Nordstrom if the Merger is Not Consummated” |
| ● | “Special
Factors—Unaudited Prospective Financial Information” |
| ● | Annex
B—Opinion of Morgan Stanley |
| ● | Annex
C—Opinion of Centerview Partners |
| (d) | Effects.
The information set forth in the Proxy Statement under the following captions is incorporated
herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Opinion of Morgan Stanley & Co. LLC to the Special Committee” |
| ● | “Special
Factors—Opinion of Centerview Partners LLC to the Special Committee” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Plans for Nordstrom After the Merger” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Benefits of the Merger for the Unaffiliated Security Holders” |
| ● | “Special
Factors—Detriments of the Merger to the Unaffiliated Security Holders” |
| ● | “Special
Factors—Certain Effects of the Merger for the Parent Filing Parties” |
| ● | “Special
Factors—Certain Effects on Nordstrom if the Merger is Not Consummated” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—U.S. Federal Income Tax Considerations of the Merger” |
| ● | “Special
Factors—Financing of the Merger” |
| ● | “Special
Factors—Fees and Expenses” |
| ● | “Special
Factors—Delisting and Deregistration of Nordstrom Common Stock” |
| ● | “The
Merger Agreement—Effect of the Merger” |
| ● | “The
Merger Agreement—Articles of Incorporation and Bylaws; Board of Directors and Officers” |
| ● | “The
Merger Agreement—Merger Consideration” |
| ● | “The
Merger Agreement—Special Dividend and Stub Period Dividend” |
| ● | “The
Merger Agreement—Treatment of Outstanding Equity Awards and Equity Plans” |
| ● | “The
Merger Agreement—Directors’ & Officers’ Indemnification and Insurance” |
| ● | “The
Merger Agreement—Employee Benefits” |
| ● | “Proposal
2: The Compensation Proposal” |
| ● | Annex
A—Agreement and Plan of Merger |
| ● | Annex
B—Opinion of Morgan Stanley |
| ● | Annex
C—Opinion of Centerview Partners |
Item
8. Fairness of the Transaction
| (a) | —
(b) Fairness; Factors considered in determining fairness. The information set
forth in the Proxy Statement under the following captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Opinion of Morgan Stanley & Co. LLC to the Special Committee” |
| ● | “Special
Factors—Opinion of Centerview Partners LLC to the Special Committee” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Benefits of the Merger for the Unaffiliated Security Holders” |
| ● | “Special
Factors—Detriments of the Merger to the Unaffiliated Security Holders” |
| ● | “Special
Factors—Certain Effects of the Merger for the Parent Filing Parties” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | Annex
B—Opinion of Morgan Stanley |
| ● | Annex
C—Opinion of Centerview Partners |
| (c) | Approval
of security holders. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference: |
| ● | “Special
Factors—Reasons for the Merger; Recommendations of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| | | |
| | ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “The
Special Meeting—Record Date; Shares Entitled to Vote; Quorum” |
| ● | “The
Special Meeting—Votes Required” |
| ● | “The
Special Meeting—Voting of Proxies” |
| ● | “The
Special Meeting—Revocability of Proxies” |
| ● | “The
Merger Agreement—Conditions to the Merger” |
| ● | “Proposal
1: The Merger Proposal” |
| ● | Annex
A—Agreement and Plan of Merger |
| (d) | Unaffiliated
representative. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| | | |
| | ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Opinion of Morgan Stanley & Co. LLC to the Special Committee” |
| ● | “Special
Factors—Opinion of Centerview Partners LLC to the Special Committee” |
| ● | Annex
B—Opinion of Morgan Stanley |
| ● | Annex
C—Opinion of Centerview Partners |
| (e) | Approval
of directors. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| | | |
| | ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—Intent of Nordstrom’s Directors and Executive Officers to Vote in Favor
of the Merger” |
| (f) | Other
offers. The information set forth in the Proxy Statement under the following captions
is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
Item
9. Reports, Opinions, Appraisals and Negotiations
| (a) | —
(b) Report, opinion or appraisal; Preparer and summary of the report, opinion or appraisal.
The information set forth in the Proxy Statement under the following captions is incorporated
herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Opinion of Morgan Stanley & Co. LLC to the Special Committee” |
| ● | “Special
Factors—Opinion of Centerview Partners LLC to the Special Committee” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Materials Provided to Liverpool by J.P. Morgan Securities LLC” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Where
You Can Find Additional Information” |
| ● | Annex
B—Opinion of Morgan Stanley |
| ● | Annex
C—Opinion of Centerview Partners |
| (c) | Availability
of documents. The information set forth in the Proxy Statement under the following
caption is incorporated herein by reference: |
| ● | “Where
You Can Find Additional Information” |
| ● | The
reports, opinions or appraisals referenced in this Item 9 will be made available for inspection
and copying at the principal executive offices of Nordstrom during its regular business hours
by any interested equity holder of Nordstrom Common Stock or by a representative who has
been so designated in writing. |
Item
10. Source and Amounts of Funds or Other Consideration
| (a) | —
(b), (d) Source of funds; Conditions; Borrowed funds. The information set forth
in the Proxy Statement under the following captions is incorporated herein by reference: |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—Financing of the Merger” |
| ● | “Special
Factors—Limited Guaranties” |
| ● | “The
Merger Agreement—Covenants Regarding Conduct of Business by Nordstrom Prior to the
Merger” |
| ● | “The
Merger Agreement—Financing” |
| ● | “The
Merger Agreement—Financing Cooperation; Notes Offer and Consent Solicitation” |
| ● | “The
Merger Agreement—Other Covenants and Agreements” |
| ● | “The
Merger Agreement—Conditions to the Merger” |
| ● | Annex
A—Agreement and Plan of Merger |
| (c) | Expenses.
The information set forth in the Proxy Statement under the following captions is incorporated
herein by reference: |
| ● | “Special
Factors—Certain Effects on Nordstrom if the Merger is Not Consummated” |
| ● | “Special
Factors—Limited Guaranties” |
| ● | “Special
Factors—Fees and Expenses” |
| ● | “The
Special Meeting—Solicitation of Proxies” |
| ● | “The
Merger Agreement—Termination of the Merger Agreement—Termination Rights Exercisable
by Nordstrom” |
| ● | “The
Merger Agreement— Termination
of the Merger Agreement—Termination Rights Exercisable by Parent” |
| ● | “The
Merger Agreement—Termination Fees” |
| ● | “The
Merger Agreement—Miscellaneous—Expenses” |
| ● | Annex
A—Agreement and Plan of Merger |
Item
11. Interest in Securities of the Subject Company
| (a) | Securities
ownership. The information set forth in the Proxy Statement under the following captions
is incorporated herein by reference: |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Important
Information Regarding Nordstrom—Security Ownership of Certain Beneficial Owners and
Management” |
| ● | “Important
Information Regarding the Parent Filing Parties” |
| ● | “The
Rollover and Support Agreements” |
| ● | Annex
D—Rollover, Voting and Support Agreement (Family Group) |
| ● | Annex
E—Rollover, Voting and Support Agreement (Liverpool) |
| (b) | Securities
transactions. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Important
Information Regarding Nordstrom—Security Ownership of Certain Beneficial Owners and
Management” |
| ● | “Important
Information Regarding Nordstrom—Transactions in Nordstrom Common Stock” |
| ● | “Important
Information Regarding Nordstrom—Prior Public Offerings” |
| | | |
| | ● | “Important
Information Regarding the Parent Filing Parties” |
| ● | “The
Rollover and Support Agreements” |
| ● | Annex
A—Agreement and Plan of Merger |
| ● | Annex
D—Rollover, Voting and Support Agreement (Family Group) |
| ● | Annex
E—Rollover, Voting and Support Agreement (Liverpool) |
Item
12. The Solicitation or Recommendation
| (d) | Intent
to tender or vote in a going-private transaction. The information set forth in the
Proxy Statement under the following captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| | | |
| | ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Intent of Nordstrom’s Directors and Executive Officers to Vote in Favor
of the Merger” |
| ● | “Special
Factors—Intent of Certain Shareholders to Vote in Favor of the Merger” |
| ● | “The
Special Meeting—Votes Required” |
| ● | “The
Rollover and Support Agreements” |
| ● | Annex
D—Rollover, Voting and Support Agreement (Family Group) |
| ● | Annex
E—Rollover, Voting and Support Agreement (Liverpool) |
| (e) | Recommendation
of others. The information set forth in the Proxy Statement under the following captions
is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| | | |
| | ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Proposal
1: The Merger Proposal” |
Item
13. Financial Information
| (a) | Financial
statements. The audited consolidated financial statements set forth in Item 8 of
Nordstrom’s Annual Report on Form 10-K for the fiscal year ended February 3, 2024 and
the financial statements set forth in Item 1 of Nordstrom’s Quarterly Report on Form
10-Q for the quarterly period ended November 2, 2024 are incorporated herein by reference. |
The
information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
| ● | “Special
Factors—Certain Effects of the Merger” |
| ● | “Special
Factors—Unaudited Prospective Financial Information” |
| ● | “Important
Information Regarding Nordstrom—Selected Historical Consolidated Financial Data” |
| ● | “Important
Information Regarding Nordstrom—Book Value Per Share” |
| ● | “Where
You Can Find Additional Information” |
| (b) | Pro
forma information. Not applicable. |
Item
14. Persons/Assets, Retained, Employed, Compensated or Used
| (a) | —
(b) Solicitations or recommendations; Employees and corporate assets. The information
set forth in the Proxy Statement under the following captions is incorporated herein by reference: |
| ● | “Special
Factors—Background of the Merger” |
| ● | “Special
Factors—Reasons for the Merger; Recommendation of the Special Committee and the Nordstrom
Board” |
| ● | “Special
Factors—Position of the Parent Filing Parties as to the Fairness of the Merger” |
| ● | “Special
Factors—Plans for Nordstrom After the Merger” |
| ● | “Special
Factors—Purposes and Reasons of the Parent Filing Parties for the Merger” |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “Special
Factors—Fees and Expenses” |
| ● | “The
Special Meeting—Solicitation of Proxies” |
Item
15. Additional Information
| (b) | Golden
Parachute Compensation. The information set forth in the Proxy Statement under the
following captions is incorporated herein by reference: |
| ● | “Special
Factors—Interests of Nordstrom’s Directors and Executive Officers in the Merger” |
| ● | “The
Merger Agreement—Merger Consideration” |
| ● | “The
Merger Agreement—Treatment of Outstanding Equity Awards and Equity Plans” |
| ● | “Proposal
2: The Compensation Proposal” |
| ● | Annex
A—Agreement and Plan of Merger |
| (c) | Other
material information. The information set forth in the Proxy Statement, including
all annexes thereto, is incorporated herein by reference. |
Item
16. Exhibits
The
following exhibits are filed herewith:
SIGNATURES
After
due inquiry and to the best of the undersigned’s knowledge and belief, the undersigned certifies that the information set forth
in this statement is true, complete and correct.
Dated:
March 4, 2025
| NORDSTROM,
INC. |
|
| |
|
|
| By: |
/s/
Ann Munson Steines |
|
| |
Name:
|
Ann
Munson Steines |
|
| |
Title:
|
Chief
Legal Officer, General Counsel and Corporate Secretary |
|
| |
|
|
| NORSE
HOLDINGS, INC. |
|
| |
|
|
| By: |
/s/
Erik B. Nordstrom |
|
| |
Name:
|
Erik
B. Nordstrom |
|
| |
Title:
|
Co-Chief
Executive Officer |
|
| |
|
| NAVY
ACQUISITION CO. INC. |
|
| |
|
|
| By: |
/s/
Erik B. Nordstrom |
|
| |
Name:
|
Erik
B. Nordstrom |
|
| |
Title:
|
President,
Treasurer and Secretary |
|
| |
|
|
| EL
PUERTO DE LIVERPOOL, S.A.B. DE C.V. |
|
| |
|
|
| By: |
/s/
Graciano Guichard González |
|
| |
Name:
|
Graciano
Guichard González |
|
| |
Title:
|
Chairman
of the Board |
|
| |
|
|
| By: |
/s/
Enrique Guijosa Hidalgo |
|
| |
Name:
|
Enrique
Guijosa Hidalgo |
|
| |
Title:
|
Chief
Executive Officer |
|
| ANNE
E. GITTINGER |
| |
|
| /s/
Anne E. Gittinger |
|
| ANNE
E. GITTINGER TRUST U/W EVERETT W. NORDSTROM |
| |
|
|
| By: |
/s/
Charles W. Riley, Jr. |
|
| |
Name: |
Charles
W. Riley, Jr. |
|
| |
Title:
|
Trustee |
|
1976
ELIZABETH J. NORDSTROM TRUST FBO ANNE GITTINGER
| By: |
/s/
Anne E. Gittinger |
|
| |
Name:
|
Anne E.
Gittinger |
|
| |
Title:
|
Trustee |
|
| CHARLES
W. RILEY, JR., SOLELY IN HIS CAPACITY AS TRUSTEE OF ANNE E. GITTINGER TRUST U/W EVERETT W. NORDSTROM AND AS CO-TRUSTEE OF TRUST A
U/W FRANCES W. NORDSTROM AND NOT IN ANY INDIVIDUAL CAPACITY |
| |
|
|
| By: |
/s/
Charles W. Riley, Jr. |
|
| |
Name:
|
Charles
W. Riley, Jr. |
|
| |
Title:
|
Trustee |
|
| ESTATE
OF BRUCE A. NORDSTROM |
|
| |
|
|
| By: |
/s/
Margaret Jean O’Roark Nordstrom |
|
| |
Name:
|
Margaret
Jean O’Roark Nordstrom |
|
| |
Title:
|
Co-Executor |
|
| |
|
|
| By: |
/s/
Peter E. Nordstrom |
|
| |
Name:
|
Peter
E. Nordstrom |
|
| |
Title:
|
Co-Executor |
|
| |
|
|
| By: |
/s/
Erik B. Nordstrom |
|
| |
Name:
|
Erik
B. Nordstrom |
|
| |
Title:
|
Co-Executor |
|
1976
BRUCE A. NORDSTROM TRUST (AKA 1976 ELIZABETH J. NORDSTROM TRUST FBO BRUCE A. NORDSTROM)
| By: |
/s/
Peter E. Nordstrom |
|
| |
Name:
|
Peter
E. Nordstrom |
|
| |
Title:
|
Co-Trustee |
|
| |
|
|
| By: |
/s/
Erik B. Nordstrom |
|
| |
Name:
|
Erik
B. Nordstrom |
|
| |
Title:
|
Co-Trustee |
|
| TRUST
A U/W FRANCES W. NORDSTROM |
|
| |
|
|
| By: |
/s/
Peter E. Nordstrom |
|
| |
Name:
|
Peter
E. Nordstrom |
|
| |
Title:
|
Co-Trustee |
|
| |
|
|
| By: |
/s/
Erik B. Nordstrom |
|
| |
Name:
|
Erik
B. Nordstrom |
|
| |
Title:
|
Co-Trustee |
|
| |
|
|
| By: |
/s/
Charles W. Riley, Jr. |
|
| |
Name:
|
Charles
W. Riley, Jr. |
|
| |
Title:
|
Co-Trustee |
|
MARGARET
JEAN O'ROARK NORDSTROM, IN HER CAPACITY AS CO-EXECUTOR OF THE ESTATE OF BRUCE A. NORDSTROM
| /s/
Margaret Jean O’Roark Nordstrom |
|
| PETER
E. NORDSTROM |
| |
|
| /s/
Peter E. Nordstrom |
|
| ERIK
B. NORDSTROM |
| |
|
| /s/
Erik B. Nordstrom |
|
| JAMES
F. NORDSTROM, JR. |
| |
|
| /s/
James F. Nordstrom, Jr. |
|
| KATHARINE
T. NORDSTROM 2007 TRUST AGREEMENT |
| |
|
|
| By: |
/s/
James F. Nordstrom, Jr. |
|
| |
Name:
|
James
F. Nordstrom, Jr. |
|
| |
Title:
|
Trustee |
|
| JULIA
K. NORDSTROM 2007 TRUST AGREEMENT |
| |
|
|
| By: |
/s/
James F. Nordstrom, Jr. |
|
| |
Name:
|
James
F. Nordstrom, Jr. |
|
| |
Title:
|
Trustee |
|
| AUDREY
G. NORDSTROM 2007 TRUST AGREEMENT |
| |
|
|
| By: |
/s/
James F. Nordstrom, Jr. |
|
| |
Name:
|
James
F. Nordstrom, Jr. |
|
| |
Title:
|
Trustee |
|
| ERIK
AND JULIE NORDSTROM 2012 SARA D. NORDSTROM TRUST |
| |
|
|
| By: |
/s/
Peter E. Nordstrom |
|
| |
Name:
|
Peter
E. Nordstrom |
|
| |
Title:
|
Trustee |
|
| BRUCE
AND JEANNIE NORDSTROM 2010 MFN TRUST |
| |
|
|
| By: |
/s/
Peter E. Nordstrom |
|
| |
Name: |
Peter
E. Nordstrom |
|
| |
Title:
|
Trustee |
|
| PETE
AND BRANDY NORDSTROM 2010 MFN TRUST |
| |
|
|
| By: |
/s/
Erik B. Nordstrom |
|
| |
Name:
|
Erik
B. Nordstrom |
|
| |
Title:
|
Trustee |
|
| BRUCE
AND JEANNIE NORDSTROM 2012 CFN TRUST |
| |
|
|
| By: |
/s/
Peter E. Nordstrom |
|
| |
Name:
|
Peter
E. Nordstrom |
|
| |
Title:
|
Trustee |
|
| PETE
AND BRANDY NORDSTROM 2012 CFN TRUST |
| |
|
|
| By: |
/s/
Erik B. Nordstrom |
|
| |
Name: |
Erik
B. Nordstrom |
|
| |
Title:
|
Trustee |
|
| PETE
AND BRANDY NORDSTROM 2012 CHILDREN’S TRUST |
| |
|
|
| By: |
/s/
Erik B. Nordstrom |
|
| |
Name:
|
Erik
B. Nordstrom |
|
| |
Title:
|
Trustee |
|
Exhibit 16(b)(i)
Execution Version
|
WELLS FARGO BANK, NATIONAL ASSOCIATION
125 High Street, 11th Floor
Boston, Massachusetts 02110 |
JPMORGAN CHASE BANK, N.A.
383 Madison Avenue
New York, New York 10179 |
Highly Confidential
December 22, 2024
Norse Holdings, Inc.
1617 Sixth Avenue
Seattle, Washington 98101
c/o Norse Holdings, Inc.
Project Norse
$1,200 million ABL Facility
Commitment Letter
Ladies and Gentlemen:
You have advised Wells Fargo
Bank, National Association (“Wells Fargo”), , JPMorgan Chase Bank, N.A. (“JPMorgan” and together
with Wells Fargo, the “Initial Commitment Parties” and, together with each other person, if any, added as a commitment
party after the date of this Commitment Letter, “we” or “us” and each, a “Commitment Party”)
Norse Holdings, Inc., a domestic entity (“you” or “Holdings”) formed at the direction of a group
composed of Erik and Peter Nordstrom, certain other members of the Nordstrom family and related trusts (“Nordstrom Family”),
and El Puerto de Liverpool S.A.B. de C.V. (“Liverpool,” and collectively with the Nordstrom Family, the “Buyer
Group”), intends, directly or indirectly, to acquire Nordstrom, Inc. (the “Company” and, together with its
subsidiaries, the “Acquired Business”) and to consummate the other transactions described in Exhibit A hereto.
Capitalized terms used but not defined herein have the meanings assigned to them in the exhibits hereto.
In connection with the Transactions,
Wells Fargo and JPMorgan (in such capacity, each an “Initial ABL Lender” and, together, the “Initial ABL Lenders”),
commit to provide severally and not jointly the amount set forth next to its name in the table below of the ABL Facility on the terms
set forth in the Term Sheet attached hereto as Exhibit B.
| Initial ABL Lender | |
ABL Facility Commitment | | |
Commitment Percentage of
ABL Facility | |
| Wells Fargo | |
$ | 600,000,000.00 | | |
| 50 | % |
| JPMorgan | |
$ | 600,000,000.00 | | |
| 50 | % |
| | 1 | Project Norse – Commitment Letter |
The ABL Facility will contain
the terms set forth on the Term Sheet, and the commitments of each Initial ABL Lender are subject only to the conditions set forth on
the Conditions Annex (as defined below). The commitments with respect to the ABL Facility are on a several, and not joint and several,
basis.
This commitment letter, together
with the Term Sheet and the other attachments hereto and thereto, is referred to herein as this “Commitment Letter.”
This Commitment Letter and the Fee Letters (as defined below in Section 5), together, are referred to herein as the “Commitment
Papers.”
It is agreed that (a) Wells
Fargo and JPMorgan will act as joint lead arrangers and bookrunning managers for the ABL Facility (in such capacities, collectively the
“Lead Arrangers”, and each a “Lead Arranger”). It is further understood and agreed that (x) Wells
Fargo will have “lead left” and “highest” placement on all marketing materials relating to the ABL Facility and
will perform the duties and, to the extent not inconsistent with the other terms of this Commitment Letter, exercise the authority conventionally
understood to be associated with such role, and (y) JPMorgan will receive “second placement” in any listing of Lead Arrangers
for the ABL Facility and (b) Wells Fargo will act as sole administrative agent and collateral agent for the ABL Facility (in such capacity,
the “ABL Administrative Agent”). You agree that JPMorgan may perform its responsibilities as a Lead Arranger through
its affiliate, J.P. Morgan Securities LLC.
No other agents, co-agents,
lead arrangers, co-arrangers, bookrunners, managers or co-managers will be appointed, no other titles will be awarded and no compensation
to any of the foregoing or any Commitment Party (other than compensation expressly contemplated by the Commitment Papers) will be paid
in order to obtain a commitment to participate in the ABL Facility unless you and we agree in writing.
The Lead Arrangers reserve
the right, prior to or after the execution of the ABL Facility Documentation (as defined in Exhibit C to this Commitment Letter), to syndicate
all or a portion of the commitments with respect to the ABL Facility to a group of banks, financial institutions and other institutional
lenders that are identified by the Lead Arrangers and subject to your prior consent (such consent not to be unreasonably withheld or delayed)
(together with the Initial ABL Lenders, the “ABL Lenders”). The Lead Arrangers will not syndicate the commitments or
any portion thereof to the following entities (collectively, the “Disqualified Lenders”):
| (a) | those entities identified by or on behalf of you in writing, from time to time, as competitors of the
Acquired Business; |
| (b) | any persons that are engaged as principals primarily in private equity, mezzanine financing or venture
capital and such other persons that are, in each case, identified in writing by or on behalf of you to us on or prior to the date hereof
or with the consent of the ABL Administrative Agent, by the Borrower in writing at any time on and after the Closing Date; |
| (c) | any person that is an affiliate of the entities described in the preceding clauses (a) and (b) (other
than any bona fide debt fund affiliates thereof (except to the extent separately identified under clause (a) or (b) above)); provided
that such person is either reasonably identifiable as an affiliate solely on the basis of its name or is identified in writing to us by
or on behalf of you; and |
| | 2 | Project Norse – Commitment Letter |
| (d) | “Excluded Affiliates” (as defined below). |
No Disqualified Lender may
become an ABL Lender or have any commitment or right (including a participation right) with respect to the ABL Facility; provided
that, to the extent persons are identified as Disqualified Lenders in writing by you after the date of this Commitment Letter (or, if
after the Closing Date, by you to the ABL Administrative Agent) pursuant to clauses (a) or (c) above, the inclusion of such persons as
Disqualified Lenders shall not retroactively apply to prior assignments or participations made in compliance with applicable assignment
or participation provisions. Notwithstanding the Lead Arrangers’ right to syndicate the ABL Facility and receive commitments with
respect thereto, (i) no Initial ABL Lender will be relieved, released or novated from its obligations under the Commitment Papers
in connection with any syndication, assignment or participation of the ABL Facility, including its commitments and obligations to fund
such ABL Facility, until after the initial funding under the ABL Facility has occurred (or, if there is no funding of the ABL Facility
on the Closing Date, the date of the effectiveness of the ABL Facility), (ii) no assignment or novation will become effective (as
between you and the Initial ABL Lenders) with respect to all or any portion of the Initial ABL Lenders’ commitments in respect of
the ABL Facility until the initial funding of the ABL Facility has occurred (or, if there is no funding of the ABL Facility on the Closing
Date, the date of the effectiveness of the ABL Facility) and (iii) unless you otherwise expressly agree in writing, the Initial ABL
Lenders will retain exclusive control over all rights and obligations with respect to their commitments in respect of the ABL Facility,
including all rights with respect to consents, modifications, supplements, waivers and amendments, until the initial funding under the
ABL Facility has occurred (or, if there is no funding of the ABL Facility on the Closing Date, the date of the effectiveness of the ABL
Facility).
The Lead Arrangers intend to
commence syndication efforts promptly upon the execution of this Commitment Letter and, as part of their syndication efforts, it is the
Lead Arrangers’ intent to have ABL Lenders commit to the ABL Facility prior to the Closing Date (subject to the limitations set
forth in the preceding paragraph). You agree to use your commercially reasonable efforts to assist the Lead Arrangers in completing a
Successful ABL Syndication (as defined in the Arranger Fee Letter) until the date that is the earlier of (a) 60 days after the Closing
Date and (b) the date on which a Successful ABL Syndication is achieved (such earlier date, the “Syndication Date”).
Such assistance shall be limited to the following (and subject to the second to last paragraph of this Section 3), upon request:
| (i) | your using your commercially reasonable efforts to ensure that any syndication efforts benefit from your
existing lending and investment banking relationships and the existing lending and investment banking relationships of the Acquired Business; |
| (ii) | direct contact between your senior management (and you using your commercially reasonable efforts, to
the extent not in contravention of the terms of the Acquisition Agreement, to arrange for direct contact with senior management of the
Company) and the proposed ABL Lenders at times and locations to be mutually agreed upon (which meeting may be virtual); |
| (iii) | your assistance (and your using your commercially reasonable efforts, to the extent not in contravention
of the terms of the Acquisition Agreement, to cause the Company to assist) in the preparation of a customary confidential information
memorandum (the “Confidential Information Memorandum”) for the ABL Facility and other customary marketing materials
to be used in connection with the syndication of the ABL Facility; provided that (A) the Confidential Information Memorandum and
such marketing materials will be in a form consistent with confidential offering memoranda and marketing materials used in recent similar
transactions, (B) such assistance shall require delivery by you only of such information as is customarily delivered by a borrower in
debt facilities such as the ABL Facility and (C) such assistance shall not require delivery of any information customarily provided by
a financing source in the preparation of such Confidential Information Memorandum; |
| | 3 | Project Norse – Commitment Letter |
| (iv) | the hosting, with the Lead Arrangers, of one meeting (which may be held by telephone, video or other electronic
method) for the ABL Facility of prospective ABL Lenders at times and locations to be mutually agreed upon; and |
| (v) | using commercially reasonable efforts, to the extent not in contravention of the terms of the Acquisition
Agreement, to ensure that the ABL Administrative Agent has sufficient access to the Acquired Business to complete a field examination
and inventory appraisal with respect to assets to be included in the Borrowing Base; |
Until the Syndication Date:
| (A) | you agree to ensure that there will not be any competing issuances of your and your subsidiaries’
debt securities or your or your subsidiaries’ commercial bank or other credit facilities (and to use your commercially reasonable
efforts to ensure that there will not be any such competing issues or facilities of the Acquired Business), in each case being offered,
placed or arranged that would reasonably be expected to materially impair the primary syndication of the ABL Facility prior to the later
of the Closing Date and the Syndication Date without the prior written consent of the Lead Arrangers (it being agreed that this clause
(A) will not apply to any indebtedness (1) under the ABL Facility, (2) under a credit facility or other debt instrument made available
to Holdings by Liverpool or any of its affiliates in connection with the Acquisition (the “Parent SPV Loan”), (3) under
any credit facility made available to Liverpool or an affiliate thereof in connection with the Acquisition (each a “Liverpool
Loan”) or (4) permitted to be incurred prior to the Closing Date, or remain outstanding on or after the Closing Date, pursuant
to the terms of the Acquisition Agreement and it being understood and agreed that the Acquired Business’ ordinary course debt, drawings
on existing commitments under the existing credit agreement, short-term working capital facilities and ordinary course capital leases,
deferred purchase price obligations, surety bonds, bank guarantees, hedging arrangements, purchase money and equipment financings will
not materially impair the primary syndication of the ABL Facility); and |
| (B) | you agree to provide (and to use your commercially reasonable efforts to
cause the Acquired Business to provide) to the Lead Arrangers all customary information reasonably available to you with respect to (i)
you, (ii) the Acquired Business, (iii) your and its respective subsidiaries and (iv) the Transactions, including projections of the type
customarily included in a “private side” bank book (such projections, together with financial estimates, forecasts and other
forward-looking information, the “Projections”), as the Lead Arrangers may reasonably request in connection with the
syndication of the ABL Facility; provided, that the only other Projections, financial statements
and other financial information that shall be required to be provided to the Lead Arrangers shall be the Projections, financial statements
and other financial information already provided as of the date hereof or required to be delivered pursuant to paragraph 4 of the Conditions
Annex attached hereto. |
For the avoidance of doubt,
you will not be required to provide (or to cause any person to provide) any trade secrets or information to the extent that the provision
thereof would violate any law, rule or regulation, fiduciary duty, binding agreement, or any obligation of confidentiality binding upon,
or waive any privilege that may be asserted by, you, the Acquired Business or any of your or its respective affiliates (so long as such
obligation is not entered into in contemplation of this provision); provided that, in the event that you do not provide information
in reliance on this sentence, you shall provide notice to the Lead Arrangers promptly upon obtaining knowledge that such information is
being withheld, and you shall use your commercially reasonable efforts to communicate, to the extent feasible, the applicable information
in a way that would not violate the applicable obligation or risk waiver of such privilege; provided, further, that the
representation and warranty made by you with respect to information in Section 4 shall not be affected in any way by your decision not
to provide such information.
| | 4 | Project Norse – Commitment Letter |
Neither the commencement nor
the completion of any syndication of the ABL Facility (including the Successful ABL Syndication) nor compliance with the foregoing provisions
of this Section 3, will constitute a condition to the commitments of the Initial ABL Lenders hereunder or the funding of the ABL Facility
on the Closing Date (or, if there is no funding of the ABL Facility on the Closing Date, the date of the effectiveness of the ABL Facility).
We acknowledge that the Acquired Business and/or its affiliates are not restricted from incurring debt or liens prior to the date or time
that the Acquisition is required to be consummated pursuant to the terms of the Acquisition Agreement (the “Acquisition Date”),
except as specifically set forth in the Acquisition Agreement, and that prior to the Acquisition Date, the Acquired Business is obligated
to assist with respect to the ABL Facility, and any other financing for the Transactions, only to the extent set forth in the Acquisition
Agreement, and the extent of such restrictions and assistance (as set forth in the Acquisition Agreement) is acceptable to us. Your obligations
under the Commitment Papers to use “commercially reasonable efforts” (a) to take any action shall not require you or any of
your affiliates to make any equity contribution in excess of the Minimum Equity Contribution (as defined Exhibit A) or to incur any fee
not specifically contemplated by the Commitment Papers (including any “market flex” provisions) and (b) to cause the Acquired
Business or their respective management or affiliates to take (or to refrain from taking) any action is subject to the terms of the Acquisition
Agreement, and it will not require you, under any circumstances, to commence any litigation or to take any action that is not practical,
appropriate or reasonable in light of the circumstances or in contravention of the terms of the Acquisition Agreement, to take any action
that would reasonably be expected to permit the Acquisition Agreement to be terminated or to commence litigation with respect to the Acquisition
Agreement. Prior to the Closing Date, your obligations to cause the Acquired Business to take (or refrain from taking) any action shall
be limited to your commercially reasonable efforts.
Except as set forth above,
the Lead Arrangers will, in consultation with you, manage all aspects of any syndication of the ABL Facility, including (a) decisions
as to the selection of institutions reasonably acceptable to you to be approached, which will exclude Disqualified Lenders, (b) subject
to your prior written consent (such consent not to be unreasonably withheld or delayed), when they will be approached, (c) when their
commitments will be accepted, (d) which institutions will participate (which will exclude Disqualified Lenders and be subject to your
consent rights and rights of appointment set forth above), (e) subject to your prior written consent (such consent not to be unreasonably
withheld or delayed), the allocation of the commitments among the ABL Lenders and (f) the amount and distribution of fees among the ABL
Lenders.
| | 5 | Project Norse – Commitment Letter |
You hereby represent (with
respect to information provided by or concerning the Acquired Business or its operations or assets prior to the Closing Date, to your
knowledge) that (a) all written information and written data (other than the Projections and information of a general economic or industry
nature (the “Information”)) that has been or will be made available to the Commitment Parties by or on your behalf,
when taken as a whole, does not or 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, when taken as a whole, not materially misleading in light of the circumstances
under which such statements are made (in each case, after giving effect to all supplements and updates thereto from time to time) and
(b) the Projections that have been or will be made available to the Lead Arrangers by or on your behalf, when taken as a whole, have been
or will be prepared, in good faith based upon assumptions that are believed by you to be reasonable at the time prepared and at the time
any such Projections are delivered to the Lead Arrangers; it being understood that (1) Projections are predictions as to future events
and are not to be viewed as facts, (2) Projections are subject to significant uncertainties and contingencies, many of which are beyond
the control of you, the Buyer Group and the Acquired Business, (3) no assurance can be given that any particular Projections will be realized
and (4) actual results may differ significantly and such differences may be material. You agree that, if at any time prior to the later
of the Closing Date and the Syndication Date, you become aware that any of the representations in the preceding sentence would be incorrect
in any material respect if the Information and Projections were being furnished, and such representations were being made, at such time,
then you will supplement, and will use your commercially reasonable efforts to cause the Company to supplement, the Information and the
Projections so that such representations will be correct in all material respects under those circumstances; provided that any
such supplementation shall cure any breach of such representations. In arranging and syndicating the ABL Facility, the Lead Arrangers
will be entitled to use and rely on the Information and the Projections without responsibility for independent verification thereof, and
the Lead Arrangers do not assume responsibility for the accuracy or completeness of the Information or Projections. For the avoidance
of doubt, the accuracy of the representations set forth above is not a condition precedent to the commitments hereunder or the funding
of the ABL Facility on the Closing Date.
You
acknowledge that (a) we may make available the Information and the Projections to a proposed syndicate of ABL Lenders (other than Disqualified
Lenders) by posting the Information or the Projections on IntraLinks or another similar electronic system (the “Platform”),
in each case, subject to a market standard “click through” or similar confidentiality agreement, and (b) certain ABL Lenders
(each, a “Public Lender”) may not wish to receive information with respect to you, the Acquired Business and your and
their respective subsidiaries or your and their respective securities that is not publicly available or has not been made (or would not
be expected to be made) available to investors in connection with a Rule 144A or public offering of the Initial Borrower’s or the
Company’s securities (“material non-public information”). At the request of the Lead Arrangers, you agree to
use your commercially reasonable efforts to assist us in preparing an additional version of the Confidential Information Memorandum (the
public-side version) to be used by Public Lenders, that will include no material non-public information with respect to you, the Acquired
Business or your or their respective subsidiaries or your and their respective securities for purposes of United States federal and state
securities laws. It is understood that in connection with the assistance described above, (i) to the extent reasonably requested by the
Lead Arrangers, you agree to deliver (and to use your commercially reasonable efforts to cause the Company to deliver) a customary authorization
letter to be included in each Confidential Information Memorandum in a form customarily included in the Confidential Information Memorandum
for senior secured bank financings (provided, that the customary “10b-5” representation in such authorization letter
will be consistent with the representations set forth in the preceding paragraph of this Commitment Letter (provided, that, for
the avoidance of doubt, such representation shall not contain a knowledge qualifier)) that authorizes the distribution of such Confidential
Information Memorandum to prospective ABL Lenders (other than Disqualified Lenders) and confirms that the public-side version does not
include material non-public information with respect to you, the Initial Borrower, the Acquired Business, your or their respective subsidiaries
or your or their respective securities for purposes of United States federal and state securities laws; (ii) each Confidential Information
Memorandum will exculpate you, the Buyer Group, the Acquired Business and us and your and our respective affiliates with respect to the
content and the use of such Confidential Information Memorandum or any related marketing material by the recipients thereof; (iii) the
public-side version of the Confidential Information Memorandum and information provided to Public Lenders, subject to the confidentiality
and other provisions of this Commitment Letter, may include the following information, except to the extent you notify (including
by email) us to the contrary (prior to their distribution) and provided that you have been given
a reasonable opportunity to review such public-side version and comply with U.S. Securities and Exchange Commission disclosure requirements:
(A) drafts and final ABL Facility Documentation (other than fee letters) and customary marketing term sheets that have been approved by
you (such approval not to be unreasonably withheld or delayed), (B) administrative materials prepared by the Lead Arrangers for prospective
ABL Lenders (such as a lender meeting invitation, allocations and funding and closing memoranda) and (C) notification of changes in the
terms of the ABL Facility; (iv) at our request, you agree to use your commercially reasonable efforts to identify information to be distributed
to Public Lenders by clearly and conspicuously marking the same as “PUBLIC”; and (v) we will be entitled to treat any Information
and Projections that are not specifically identified as “PUBLIC” as being suitable for posting only on the portion of the
Platform not available to or accessible by Public Lenders. If you advise us that any of the foregoing items should not be distributed
to Public Lenders, the Lead Arrangers will not distribute such materials to Public Lenders without your consent.
| | 6 | Project Norse – Commitment Letter |
As consideration for the commitments
and agreements of each Initial ABL Lender and each Lead Arranger’s and other agents’ agreements to perform the services described
herein, you agree to pay (or cause to be paid) the fees set forth in the fee letter dated as of the date hereof between you and the Lead
Arrangers (the “Arranger Fee Letter”) and the fee letter dated as of the date hereof between you and Wells Fargo (the
“Wells Fargo Agent Fee Letter” and together with the Arranger Fee Letter, the “Fee Letters”) and
in the term sheets attached to this Commitment Letter. Once paid, such fees will not be refundable under any circumstances, except as
otherwise contemplated by the Fee Letters or otherwise agreed in writing by the parties hereto.
The commitments of each Initial
ABL Lender with respect to the ABL Facility and each Lead Arranger’s and each agent’s agreements to perform the services
described herein are subject solely to the satisfaction (or waiver by the Lead Arrangers) of the conditions precedent explicitly set
forth on the exhibit to this Commitment Letter labeled “Conditions Annex” (such conditions, the “Financing Conditions,”
and such exhibit, the “Conditions Annex”). Upon satisfaction (or waiver by the Lead Arrangers) of such conditions,
the initial funding of the ABL Facility shall occur (or, if there is no funding of the ABL Facility on the Closing Date, the date of
the effectiveness of the ABL Facility), it being understood that there are no conditions (implied or otherwise) to the commitments hereunder
and there will be no conditions (implied or otherwise) under the ABL Facility Documentation to the funding of the ABL Facility on the
Closing Date, including compliance with the terms of this Commitment Letter, the Fee Letters or the ABL Facility Documentation, other
than those that are expressly stated on the Conditions Annex.
| | 7 | Project Norse – Commitment Letter |
Notwithstanding anything in
the Commitment Papers (including each of the exhibits attached thereto), the ABL Facility Documentation or any other agreement or other
undertaking concerning the financing of the Transactions to the contrary, the following provisions (the “Certain Funds Provisions”)
will apply:
(a) the
only representations and warranties the making and accuracy of which will be a condition to the initial funding of the ABL Facility on
the Closing Date (or, if there is no funding of the ABL Facility on the Closing Date, the effectiveness of the ABL Facility) will be the
Acquisition Agreement Representations and the Specified Representations; provided, that a failure of any Acquisition Agreement
Representation to be accurate will not result in a failure of a Financing Condition or a default under the ABL Facility Documentation,
unless such failure gives (or gave) you (or your affiliates) the right pursuant to the terms of the Acquisition Agreement (taking into
account any notice, grace periods and cure provisions) to terminate the Acquisition Agreement in accordance with its terms or the right
pursuant to the terms of the Acquisition Agreement to decline to consummate the Acquisition, in each case, in accordance with its terms
and without any liability to and without resulting in the payment of any fees, liquidated damages or other amounts by you or any affiliate
under the Acquisition Agreement;
(b) the
terms of the ABL Facility Documentation and the Closing Deliverables for the ABL Facility will be subject to the ABL Documentation Principles
(as defined in Exhibit B to this Commitment Letter), will contain no conditions to the initial funding of the ABL Facility other than
the Financing Conditions, and in any event will be in a form such that they do not impair the availability of the ABL Facility on the
Closing Date if the Financing Conditions are satisfied (or waived by the Lead Arrangers); it being understood that to the extent any security
interest in any Collateral (as defined in Exhibit B to this Commitment Letter) is not or cannot be provided and/or perfected on the Closing
Date (other than the pledge and perfection of the security interests (1) in the certificated equity interests, if any, of the Initial
Borrower and the Company (to the extent required by the Term Sheet and for which a security interest can be perfected by delivering certificates
evidencing such certificated equity interests); provided that, to the extent that you have used commercially reasonable efforts
to procure the delivery thereof on or prior to the Closing Date, such certificated equity interests of the Company will only be required
to be delivered on the Closing Date pursuant to the terms set forth above if such certificates are actually received from the Company
and (2) in other assets pursuant to which a lien may be perfected by the filing of a financing statement under the Uniform Commercial
Code), after your use of commercially reasonable efforts to do so or without undue burden or expense, then the provision and/or perfection
of a security interest in such Collateral shall not constitute a condition to the availability of the ABL Facility on the Closing Date,
but instead shall be required to be delivered and/or perfected after the Closing Date pursuant to arrangements and timing to be mutually
agreed by the ABL Administrative Agent and the Borrower acting reasonably without any requirement for ABL Lender consent, but in any event
not later than 90 days after the Closing Date or such longer period as may be agreed by the ABL Administrative Agent and the Borrower
acting reasonably; and
(c) there
are no conditions (implied or otherwise) to the commitments and agreements hereunder (including compliance with the terms of the Commitment
Papers or the ABL Facility Documentation), other than the Financing Conditions, and upon satisfaction (or waiver by the Lead Arrangers)
of the Financing Conditions, the ABL Administrative Agent and the Initial ABL Lenders and each other party thereto will execute and deliver
the ABL Facility Documentation to which it is a party and the initial funding under the ABL Facility will occur (or, if there is no funding
of the ABL Facility on the Closing Date, the effectiveness of the ABL Facility).
“Acquisition Agreement
Representations” means such of the representations and warranties made by the Acquired Business with respect to the Acquired
Business in the Acquisition Agreement to the extent a breach of such representations and warranties is material and adverse to the interests
of the Initial ABL Lenders (in their capacities as such), but only to the extent that you (or your
affiliates) have the right to terminate pursuant to the terms of the Acquisition Agreement (taking into account any notice, grace periods
and cure provisions) the Acquisition Agreement or the right pursuant to the terms of the Acquisition Agreement to decline to consummate
the Acquisition (in each case, in accordance with the terms thereof and without any liability to and without resulting in the payment
of any fees, liquidated damages or other amounts by you or any affiliate under the Acquisition Agreement) as a result of a breach of such
representations and warranties in the Acquisition Agreement.
| | 8 | Project Norse – Commitment Letter |
“Specified Representations”
means the representations and warranties of the Loan Parties (as defined in Exhibit B) set forth in the ABL Facility Documentation
relating to their organizational existence of the Loan Parties, organizational power and authority (only as to execution, delivery and
performance of the ABL Facility Documentation), their due authorization, execution, delivery and enforceability (against them) of the
ABL Facility Documentation, solvency of the Borrower and its Subsidiaries on a consolidated basis as of the Closing Date after giving
effect to the Transactions (consistent with the solvency certificate attached to this Commitment Letter), no conflicts of ABL Facility
Documentation (only as to execution, delivery and performance of the ABL Facility Documentation and the extensions of credit thereunder)
with their charter documents (as in effect upon consummation of, or immediately after consummation of, the Acquisition and the adoption
of any related resolutions), compliance of the Transactions with Federal Reserve margin regulations, the Investment Company Act, the
Patriot Act, use of proceeds not violating OFAC and the FCPA and the creation, validity and perfection of security interests in the Collateral
(subject to Permitted Liens and the Certain Funds Provisions). Notwithstanding anything to the
contrary contained herein, if any of the Specified Representations are qualified or subject to “material adverse effect”,
the definition of “Material Adverse Effect” in the Acquisition Agreement shall apply for the purposes of any representations
and warranties made, or to be made, on or as of the Closing Date.
| 7. | Indemnification; Limitation of Liability; Expenses. |
You agree to indemnify and
hold harmless each Commitment Party and its affiliates and controlling persons and the respective officers, directors, employees, partners,
agents and representatives of each of the foregoing and their successors and permitted assigns (each, an “Indemnified Person”)
to the fullest extent permitted by applicable law, from and against any and all losses, claims, damages and liabilities, joint or several,
to which any such Indemnified Person actually incurred or suffered by such Indemnified Person, to the extent arising out of, resulting
from or in connection with the Commitment Papers, the Transactions or the ABL Facility, or any claim, litigation, investigation or proceeding
(each, an “Action”) relating to any of the foregoing, regardless of whether any such Indemnified Person is a party
thereto and whether or not such Action is brought by you, your equity holders, affiliates, creditors or any other person, and to reimburse
each such Indemnified Person, promptly after receipt of a written request, together with customary backup documentation in reasonable
detail, for any reasonable and documented out-of-pocket legal expenses (limited to one counsel for all Indemnified Persons taken as a
whole and, if reasonably necessary, a single local counsel for all Indemnified Persons taken as a whole in each relevant jurisdiction
(which may be a single local counsel acting in multiple jurisdictions) and, solely in the case of any actual or perceived conflict of
interest between Indemnified Persons where the Indemnified Persons affected by such conflict inform you of such conflict, one additional
counsel in each relevant jurisdiction to each group of affected Indemnified Persons similarly situated, taken as a whole) or other reasonable
and documented in reasonable detail out-of-pocket expenses incurred in connection with investigating or defending any of the foregoing;
provided, that the foregoing indemnity will not, as to any Indemnified Person, apply to losses, claims, damages, liabilities or
expenses to the extent (a) resulting from the willful misconduct, bad faith or gross negligence of such Indemnified Person or any Related
Indemnified Persons (as defined below) of such Indemnified Person, (b) arising from a material breach of the obligations of such
Indemnified Person or any Related Indemnified Persons of such Indemnified Person under the Commitment Papers or the ABL Facility Documentation,
including the failure to fund the ABL Facility upon satisfaction or waiver of the Financing Conditions (in the case of clauses (a) and
(b), as determined by a court of competent jurisdiction in a final and non-appealable judgment), or (c) arising from any dispute
among Indemnified Persons or any Related Indemnified Persons of the foregoing other than any Actions against any Commitment Party in its
collective capacities or in fulfilling its role as an Initial ABL Lender, Lead Arranger, ABL Administrative Agent or other agent role
under the ABL Facility and other than any claims arising out of any act or omission on the part of you or any of your affiliates. Notwithstanding
the foregoing, each Indemnified Person shall be obligated to refund and return promptly any and all amounts paid under the indemnification
provisions of this Commitment Letter to such Indemnified Person and its Related Indemnified Persons for any such losses, claims, damages,
liabilities or expenses to the extent such Indemnified Person and its Related Indemnified Persons is not entitled to payment of such amounts
in accordance with the terms hereof as finally determined by a final, non-appealable judgment of a court of competent jurisdiction, and,
to the extent not a party hereto, the agreement of an Indemnified Person to this provision is a condition to the indemnity provided herein.
| | 9 | Project Norse – Commitment Letter |
Notwithstanding any other provision
of this Commitment Letter (a) except to the extent resulting from the willful misconduct, bad faith or gross negligence of (or material
breach of the Commitment Papers by) such Indemnified Person or any Related Indemnified Persons of the foregoing (as determined by a court
of competent jurisdiction in a final and non-appealable judgment), no Indemnified Person will be liable for any damages arising from the
use by others of information or other materials obtained through electronic, telecommunications or other information transmission systems
(including the Platform) and (b) neither any Indemnified Person, nor you or the Acquired Business (or any of their respective directors,
officers, employees, controlling persons, controlled affiliates or agents) will be liable for any indirect, special, punitive or consequential
damages in connection with the Commitment Papers, the ABL Facility, the Transactions (including the ABL Facility and the use of proceeds
thereunder), or with respect to any activities or other transactions related to the ABL Facility; provided that, nothing in this
clause (b) shall relieve you of any obligation you may have to indemnify an Indemnified Person, as provided in the immediately preceding
paragraph, against any indirect, special, punitive or consequential damages asserted against such Indemnified Person by a third party.
You will not be liable for
any settlement of any Action effected without your prior written consent (such consent not to be unreasonably withheld or delayed (it
being understood that consent withheld for failure of any of the conditions in the immediately succeeding sentence to be true is reasonable)),
but, if settled with your written consent or if there is a final judgment in any such Actions, you agree to indemnify and hold harmless
each Indemnified Person from and against any and all losses, claims, damages, liabilities and expenses by reason of such settlement or
judgment in accordance with the indemnification provisions of this Commitment Letter. You will not, without the prior written consent
of an Indemnified Person, effect any settlement of any Action in respect of which indemnity could have been sought hereunder by such Indemnified
Person unless such settlement (i) includes an unconditional release of such Indemnified Person in form and substance reasonably satisfactory
to such Indemnified Person from all liability on claims that are the subject matter of such Actions and (ii) does not include any statement
as to or any admission of fault, culpability or a failure to act by or on behalf of such Indemnified Person.
For purposes hereof, a “Related
Indemnified Person” of an Indemnified Person means (a) any controlling person or controlled affiliate of such Indemnified Person,
(b) the respective directors, officers, or employees of such Indemnified Person or any of its controlling persons or controlled affiliates
and (c) the respective agents of such Indemnified Person or any of its controlling persons or controlled affiliates, in the case of this
clause (c), acting at the instructions of such Indemnified Person, controlling person or such controlled affiliate; provided that
each reference to a controlled affiliate or controlling person in this sentence pertains to a controlled affiliate or controlling person
involved in the negotiation or syndication of this Commitment Letter or the ABL Facility.
Each Indemnified Person shall,
in consultation with you, take all reasonable steps to mitigate any losses, claims, damages, liabilities and expenses and shall give (subject
to confidentiality or legal restrictions) such information and assistance, in each case at your sole expense, to you as you may reasonably
request in connection with any Proceeding.
| | 10 | Project Norse – Commitment Letter |
Upon the Closing Date, you
agree to reimburse each Commitment Party for its reasonable and documented in reasonable detail out-of-pocket expenses (including expenses
of each Commitment Party’s due diligence investigation, syndication expenses, travel expenses and reasonable and documented out-of-pocket
fees, disbursements and other charges of the single counsel to the Commitment Parties as identified in the Term Sheet, the reasonable
and documented out-of-pocket fees, disbursements and other charges of an additional legal counsel to the ABL Administrative Agent in an
amount not to exceed $150,000 and, if reasonably necessary, of a single local counsel to the Commitment Parties in each relevant material
jurisdiction, which may be a single local counsel acting in multiple material jurisdictions and in the case of any actual or perceived
conflict of interest, one additional counsel in each relevant material jurisdiction and the reasonable and documented expenses in connection
with the field examinations and inventory appraisals conducted prior to the Closing Date or the date that the Commitment Letter is terminated,
as applicable), in each case, incurred solely in connection with due diligence and the preparation, negotiation, execution and delivery
of the Commitment Papers and the ABL Facility Documentation and any related definitive documentation, (collectively, the “Expenses”);
provided that other than any reasonable and documented out-of-pocket expenses in connection with any collateral diligence/field
exams, which for avoidance of doubt shall be payable whether or not the Closing Date occurs, you shall not be required to reimburse any
of the Expenses in the event the Closing Date does not occur. The foregoing provisions in this paragraph shall be superseded in each case,
to the extent covered thereby, by the application provisions contained in the ABL Facility Documentation upon execution thereof and thereafter
shall have no further force and effect.
| 8. | Sharing Information; Absence of Fiduciary Relationship; Affiliate Activities; Binding Obligations. |
You acknowledge that each Commitment
Party and its affiliates may be providing debt financing, equity capital or other services (including investment banking and financial
advisory services, securities trading, hedging, financing and brokerage activities, and financial planning and benefits counseling) to
other companies in respect of which the Acquired Business may have conflicting interests. We will not furnish confidential information
obtained from you by virtue of the transactions contemplated by this Commitment Letter or our other relationships with you to such other
companies. You also acknowledge that we do not have any obligation to use, in connection with the transactions contemplated by this Commitment
Letter, or to furnish to you, confidential information obtained by us or any of our respective affiliates from such other companies.
You further acknowledge and
agree that (a) no fiduciary, advisory or agency relationship between you and any Commitment Party is intended to be or has been created
in respect of any of the transactions contemplated by this Commitment Letter, irrespective of whether such Commitment Party has advised
or is advising you on other matters, (b) each Commitment Party, on the one hand, and you, on the other hand, have an arm’s-length
business relationship that does not, directly or indirectly, give rise to, nor do you rely on, any fiduciary duty on the part of such
Commitment Party, and you waive, to the fullest extent permitted by law, any claims you may have against us for breach of fiduciary duty
or alleged breach of fiduciary duty and agree that we will have no liability (whether direct or indirect) to you in respect of such a
fiduciary duty claim or to any person asserting a fiduciary duty claim on your behalf, including equity holders, employees or creditors,
(c) you are capable of evaluating and understanding, and you understand and accept, the terms, risks and conditions of the transactions
contemplated by this Commitment Letter, (d) you have been advised that each Commitment Party and its affiliates are engaged in a
broad range of transactions that may involve interests that differ from your and your affiliates’ interests and that such Commitment
Party has no obligation to disclose such interests and transactions to you or your affiliates, (e) you have consulted your own legal,
accounting, regulatory and tax advisors to the extent you have deemed appropriate and (f) each Commitment Party has been, is and
will be acting solely as a principal and, except as otherwise expressly agreed in writing by the relevant parties, has not been, is not
and will not be acting as an advisor, agent or fiduciary for you, any of your affiliates or any other person or entity. In addition, each
Commitment Party may employ the services of its affiliates in providing certain services hereunder and may exchange with such affiliates
in connection therewith information concerning the Acquired Business, and such affiliates will be entitled to the benefits afforded to,
and subject to the obligations of (including, for the avoidance of doubt, confidentiality obligations), such Commitment Party under this
Commitment Letter.
| | 11 | Project Norse – Commitment Letter |
You further acknowledge that
each Commitment Party and its affiliates may be a full service securities firm engaged in securities trading and brokerage activities,
as well as providing investment banking and other financial services. In the ordinary course of business, each Commitment Party may provide
investment banking and other financial services to, and/or acquire, hold or sell, for their respective own accounts and the accounts of
customers, equity, debt and other securities and financial instruments (including bank loans and other obligations) of the Acquired Business
and other companies with which the Buyer Group or the Acquired Business may have commercial or other relationships. With respect to any
securities and/or financial instruments so held by each Commitment Party, its affiliates or any of its customers, all rights in respect
of such securities and financial instruments, including any voting rights, will be exercised by the holder of the rights, in its sole
discretion.
You further acknowledge and
agree that you are responsible for making your own independent judgment with respect to the Transactions and the process leading thereto.
Additionally, you acknowledge and agree that we are not advising you as to any legal, tax, investment, accounting or regulatory matters
in any jurisdiction. You will consult with your own advisors concerning such matters and will be responsible for making your own independent
investigation and appraisal of the transactions contemplated hereby.
We represent and warrant that
the Commitment Papers constitute our legally valid and binding obligation to provide services and perform our other obligations set forth
herein and to fund the ABL Facility upon satisfaction or waiver of the Financing Conditions, in each case, enforceable at law and in equity
in accordance with their terms (subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization and other similar
laws relating to or affecting creditors’ rights generally); provided that it is acknowledged and agreed by each party hereto
that the initial funding of the ABL Facility on the Closing Date will be subject solely to the Financing Conditions. You represent and
warrant that the Commitment Papers constitute your legally valid and binding obligation, enforceable at law and in equity against you
in accordance with their terms (subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization and other similar
laws relating to or affecting creditors’ rights generally); provided that nothing contained in the Commitment Papers obligates
you or any of your affiliates to consummate any Transaction or to draw upon all or any portion of the ABL Facility.
| 9. | Assignments; Amendments; Governing Law, Etc. |
Each of the parties hereto
agrees that (i) this Commitment Letter is a binding and enforceable agreement (subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization and other similar laws relating to or affecting creditors’ rights generally and general principles of
equity (whether considered in a proceeding in equity or law)) with respect to the subject matter contained herein, including an agreement
to negotiate in good faith the ABL Facility Documentation by the parties hereto in a manner consistent with this Commitment Letter, it
being acknowledged and agreed that the funding of the ABL Facility is subject only to the conditions precedent set forth in the Conditions
Annex hereto and (ii) each of the Fee Letters is a binding and enforceable agreement (subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization and other similar laws relating to or affecting creditors’ rights generally and general principles
of equity (whether considered in a proceeding in equity or law)) of the parties thereto with respect to the subject matter set forth therein.
| | 12 | Project Norse – Commitment Letter |
This Commitment Letter and
the commitments hereunder are not assignable (except assignments by you to an affiliate that is a newly formed domestic “shell”
company that consummates or intends to consummate the Acquisition and any other assignment that occurs as a matter of law in connection
with the Acquisition) without the prior written consent of each other party hereto, and any attempted assignment without such consent
will be null and void. This Commitment Letter and the commitments hereunder are intended to be solely for the benefit of the parties hereto
(and Indemnified Persons solely to the extent expressly set forth herein), is not intended to confer any benefits upon, or create any
rights in favor of, any person other than the parties hereto (and Indemnified Persons solely to the extent expressly set forth herein)
and is not intended to create a fiduciary relationship among the parties hereto. Subject to the limitations otherwise set forth herein,
any and all services to be provided by each Commitment Party hereunder may be performed by or through any of its affiliates or branches,
and such affiliates and branches will be entitled to the benefits afforded to, and will be subject to the obligations of (including, for
the avoidance of doubt, confidentiality obligations), such Commitment Party under this Commitment Letter. Except as otherwise set forth
herein, this Commitment Letter may not be amended or any provision hereof waived or modified except in a writing signed by each Commitment
Party and you. This Commitment Letter may be executed in any number of counterparts, each of which will be an original and all of which,
when taken together, will constitute one agreement. Delivery of an executed counterpart of a signature page of this Commitment Letter
by facsimile or other electronic transmission (including in “.pdf” format) will be effective as delivery of a manually executed
counterpart hereof. For purposes hereof, the words “execution,” “execute,” “executed,” “signed,”
“signature” and words of like import in this Commitment Letter or the Fee Letters shall be deemed to include electronic signatures,
the electronic matching of assignment terms and contract formulations on electronic platforms, or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures
in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on
the Uniform Electronic Transaction Act. Section headings used herein are for convenience of reference only, are not part of this Commitment
Letter and will not affect the construction of, or to be taken into consideration in interpreting, this Commitment Letter. The Commitment
Papers supersede all prior understandings, whether written or oral, among you and us with respect to the ABL Facility and set forth the
entire agreement and understanding of the parties hereto with respect thereto. No party has been authorized by us to make any oral or
written statements that are inconsistent with the Commitment Papers.
THIS COMMITMENT LETTER, AND
ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATING TO THIS COMMITMENT LETTER, WILL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK; provided, however, that (a) the interpretation of the definition
of Company Material Adverse Effect (as defined in the Acquisition Agreement) and whether or not a Company Material Adverse Effect has
occurred, including for purposes of the Financing Conditions, (b) the determination of the accuracy of any Acquisition Agreement Representation
and whether as a result of any inaccuracy of any Acquisition Agreement Representation you (or your affiliates) have the right to terminate
your (or their respective) obligations under the Acquisition Agreement or decline to consummate the Acquisition and (c) the determination
of whether the Acquisition has been consummated in accordance with the terms of the Acquisition Agreement will, in each case (whether
based in contract, tort or otherwise), be governed by, and construed and interpreted in accordance with, the Law (as defined in the Acquisition
Agreement) governing the Acquisition Agreement as applied to the Acquisition Agreement, without giving effect to any choice or conflict
of law provision or rule that would cause the application of laws of any other jurisdiction.
EACH PARTY HERETO IRREVOCABLY
AND UNCONDITIONALLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT
OR OTHERWISE) BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF THE ACQUISITION, THE TRANSACTIONS, THE COMMITMENT PAPERS
OR THE PERFORMANCE BY US OR ANY OF OUR AFFILIATES OF THE SERVICES HEREUNDER OR THEREUNDER.
| | 13 | Project Norse – Commitment Letter |
Each party hereto hereby irrevocably
and unconditionally (a) submits, for itself and its property, to the exclusive jurisdiction of any New York State court or Federal court
of the United States of America sitting in the Borough of Manhattan in the City of New York, and any appellate court from any such court,
in any suit, action, proceeding, claim or counterclaim arising out of or relating to the Commitment Papers or the Transactions, or for
recognition or enforcement of any judgment, and agrees that all claims in respect of any such suit, action, proceeding, claim or counterclaim
will be heard and determined in such New York State or, to the extent permitted by law, in such Federal court, (b) waives, to the fullest
extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action,
proceeding, claim or counterclaim arising out of or relating to the Commitment Papers or the Transactions in any court in which such venue
may be laid in accordance with the preceding clause (a) of this sentence, (c) waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such suit, action, proceeding, claim or counterclaim in any such court and (d) agrees that
a final judgment in any such action or proceeding will be conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by law. Service of any process, summons, notice or document by registered mail or overnight courier addressed
to any of the parties hereto at the addresses above will be effective service of process against such party for any suit, action, proceeding,
claim or counterclaim brought in any such court.
This Commitment Letter is delivered
to you on the understanding that none of the Fee Letters or, prior to your acceptance hereof, this Commitment Letter, or their terms or
substance, may be disclosed by you to any other person or entity, except (a) to the Buyer Group and to your and their respective officers,
directors, employees, affiliates, controlling persons, members, partners, equity holders, attorneys, accountants, representatives, agents
and advisors on a confidential and need to know basis, (b) [reserved], (c) if each Commitment Party consents in writing to such proposed
disclosure, (d) that the Term Sheet and the existence of this Commitment Letter (but not the Commitment Letter or any other contents of
the Commitment Papers other than the Term Sheet) may be disclosed to any rating agency in connection with the Transactions or (e) pursuant
to the order of any court or administrative agency in any pending legal or administrative proceeding, or otherwise as required by applicable
law or regulation or as requested by a governmental authority (in which case you agree, to the extent practicable, to inform us promptly
thereof to the extent lawfully permitted to do so); provided that you may disclose (i) the Commitment Letter and the contents thereof
(but not the Fee Letters or the contents thereof) to the Acquired Business and its officers, directors, employees, equity holders, attorneys,
accountants, representatives, agents and advisors on a confidential basis, (ii) the aggregate amount of the fees (including upfront fees
and OID) payable under any Fee Letters as part of Projections, pro forma information or as part of generic disclosure regarding sources
and uses (but without disclosing any specific fees set forth therein) in connection with any syndication of the ABL Facility or other
marketing efforts for debt to be used to finance the Transactions or in any public or regulatory filing requirement relating to the Transactions,
(iii) on a confidential basis, any Fee Letter and the contents thereof to your and the Acquired Business’ auditors and accounting
and tax advisers for customary accounting and tax purposes, including accounting for deferred financing costs, (iv) the Commitment Papers
in connection with the enforcement of your rights or remedies hereunder or under any Fee Letter, (v) this Commitment Letter (but
not the Fee Letters or the contents thereof) in any syndication of the ABL Facility or other marketing efforts for any other financing
of the Transactions, including a prospectus, offering memorandum or offering circular, or in connection with any public filing or proxy
in connection with the Transactions or financing thereof, and to rating agencies in connection with obtaining ratings for the Borrower
or as may otherwise be required by law, (vi) to the extent the amounts of fees and other economic terms of the market flex provisions
set forth therein have been redacted in a customary manner, you may disclose the Fee Letters and the contents thereof to the Company,
the Acquired Business and their respective officers, directors, employees, agents, attorneys, accountants, advisors and controlling persons,
on a confidential and need-to-know basis, (vii) you may disclose this Commitment Letter (but not the Fee Letters) in any tender offer
or proxy relating to the Transactions and (viii) this Commitment Letter and its contents (but not the Fee Letters or their contents) after
your acceptance hereof to the extent that such information becomes publicly available other than by reason of improper disclosure by you
or any of your affiliates in violation of any confidentiality obligations hereunder.
| | 14 | Project Norse – Commitment Letter |
Each Commitment Party and its
affiliates will use all confidential information provided to it or such affiliates by or on behalf of you and the contents of the Commitment
Papers solely for the purpose of providing the services that are the subject of this Commitment Letter and will treat confidentially all
such information and the Commitment Papers (including any market “flex” provisions); provided that the foregoing sentence
will not prevent such Commitment Party from disclosing any such information (a) pursuant to the order of any court or administrative agency
or otherwise as required by applicable law or regulation or as requested by a governmental authority (in which case such Commitment Party
agrees to inform you promptly thereof to the extent lawfully permitted to do so, unless such Commitment Party is prohibited by applicable
law from so informing you, or except in connection with any request as part of any regulatory (including self-regulatory) audit or examination
conducted by accountants or any governmental or regulatory authority exercising examination or regulatory authority), (b) upon the request
or demand of any governmental, regulatory authority having jurisdiction over such Commitment Party or any of its affiliates (in which
case such Commitment Party agrees to inform you promptly thereof to the extent lawfully permitted to do so prior to such disclosure, unless
such Commitment Party is prohibited by applicable law from so informing you, or except in connection with any request as part of any regulatory
audit or examination conducted by bank accountants or any governmental or regulatory authority exercising examination or regulatory authority),
(c) to the extent that such information becomes publicly available other than by reason of improper disclosure by such Commitment Party
or any of its affiliates or any related parties thereto in violation of any confidentiality obligations owing to you, the Company or any
of your or their respective subsidiaries or affiliates or related parties, (d) to the extent that such information is received by such
Commitment Party from a third party that is not to such Commitment Party’s knowledge subject to confidentiality obligations to you,
the Company or the Buyer Group, (e) to the extent that such information is independently developed by such Commitment Party without reliance
on such information, (f) to such Commitment Party and its affiliates and its and their respective officers, directors, employees, legal
counsel, independent auditors and other experts or agents who need to know such information in connection with the Transactions, are informed
of the confidential nature of such information and who are subject to customary confidentiality obligations of professional practice or
who agree to be bound by the terms of this paragraph (or language substantially similar to this paragraph) (with each such Commitment
Party, to the extent within its control, responsible for such person’s compliance with this paragraph), provided, that no
disclosure will be made by any Commitment Party, any of its affiliates or any of its or their respective officers, directors, partners,
employees, legal counsel, independent auditors and other experts or agents pursuant to this clause (f) to any affiliates that are engaged
as principals primarily in private equity, mezzanine financing or venture capital (each a “Private Equity Affiliate”)
or to any employees engaged directly or indirectly in the sale of the Company as representatives of the Company (other than, in each case,
such persons engaged by you or your affiliates as part of the Acquisition) (each, a “Sell Side Affiliate” and, together
with the Private Equity Affiliates, other than a limited number of senior employees who are required, in accordance with industry regulations
or such Commitment Party’s internal policies and procedures to act in a supervisory capacity and such Commitment Party’s internal
legal, compliance, risk management, credit or investment committee members, the “Excluded Affiliates”), (g) except
with respect to any Fee Letter and its contents, to bona fide prospective ABL Lenders, participants or assignees or any bona
fide potential counterparty (or its advisors) to any swap or derivative transaction relating to the Acquired Business or any of its
subsidiaries or any of their respective obligations, in each case who agree to be bound by the terms of this paragraph (or language substantially
similar to this paragraph) which agreement will be pursuant to customary syndication practice(h) to ratings agencies, (i) for purposes
of establishing a “due diligence” defense or (j) in connection with the enforcement of our rights hereunder or under any Fee
Letter; provided that (i) the disclosure of any such information to any ABL Lenders or prospective ABL Lenders or participants
or prospective participants will be made subject to the acknowledgment and acceptance by such ABL Lender or prospective ABL Lender or
participant or prospective participant that such information is being disseminated on a confidential basis (on substantially the terms
set forth in this paragraph or as is otherwise reasonably acceptable to you and the Commitment Parties, including, without limitation,
as agreed in any marketing materials) in accordance with the standard syndication processes of the Commitment Parties or customary market
standards for dissemination of such type of information, which will in any event require “click through” or other affirmative
actions on the part of the recipient to access such information and (ii) no such disclosure will be made to any person that was a Disqualified
Lender on the date of such disclosure.
| | 15 | Project Norse – Commitment Letter |
After the closing of the Transactions
and at such Commitment Party’s expense, each Commitment Party may (i) with the consent of Borrower, place advertisements in periodicals
and on the Internet as it may choose and (ii) on a confidential basis, circulate promotional materials in the form of a “tombstone”
or “case study” (and, in each case, otherwise describe the names of any of you or your affiliates and any other information
about the Transactions, including the amount, type and closing date of the ABL Facility). In addition, the Commitment Parties may disclose
the existence of the ABL Facility and the information about the ABL Facility to market data collectors, similar service providers to the
lending industry, and service providers to such Commitment Party in connection with the administration and management of the ABL Facility.
For the avoidance of doubt,
nothing in Section 12 shall prohibit any person from voluntarily disclosing or providing any information within the scope of this Section
12 to any governmental, regulatory or self-regulatory organization (any such entity, a “Regulatory Authority”) to the
extent that any such prohibition on disclosure by such person set forth in this Section 12 shall be prohibited by the laws or regulations
applicable to such Regulatory Authority.
The obligations under this
Section 12 with respect to this Commitment Letter but not the Fee Letters will automatically terminate and be superseded by the confidentiality
provisions in the ABL Facility Documentation (to the extent set forth therein) upon the execution and delivery of the ABL Facility Documentation
and in any event will terminate on the first anniversary of the date of this Commitment Letter.
The compensation (if applicable),
syndication (if applicable), information (if applicable), indemnification, expense (if applicable), payment of fees (if applicable), confidentiality,
jurisdiction, venue, governing law, no agency or fiduciary duty and waiver of jury trial provisions contained in the Commitment Papers
will remain in full force and effect regardless of whether definitive financing documentation is executed and delivered and notwithstanding
the termination of this Commitment Letter or the Initial ABL Lenders’ commitments hereunder and the Lead Arrangers’ and other
agents’ several agreements to provide the services described herein; provided that your obligations under the Commitment
Papers with respect to the ABL Facility, other than those relating to compensation, the syndication of the ABL Facility, information and
confidentiality, will automatically terminate and be superseded by the ABL Facility Documentation (with respect to indemnification, to
the extent covered thereby) upon consummation of the Transactions and the payment of all amounts owing at such time with respect to the
ABL Facility under the Commitment Papers.
| | 16 | Project Norse – Commitment Letter |
| 14. | Patriot Act Notification. |
We hereby notify you that pursuant
to the requirements of the USA Patriot Act, Title III of Pub. L. 107-56 (signed into law October 26, 2001) (the “Patriot Act”)
and the requirements of 31 C.F.R. § 1010.230 (the “Beneficial Ownership Regulation”), each Commitment Party and
each ABL Lender is required to obtain, verify and record information that identifies each Borrower and each Guarantor, which information
includes the name, address, tax identification number and other information regarding each Borrower and each Guarantor that will allow
such Commitment Party or such ABL Lender to identify each Borrower and each Guarantor in accordance with the Patriot Act and the Beneficial
Ownership Regulation. This notice is given in accordance with the requirements of the Patriot Act and the Beneficial Ownership Regulation
and is effective as to each Commitment Party and each ABL Lender.
| 15. | Acceptance and Termination. |
If the foregoing correctly
sets forth our agreement, please indicate your acceptance of the terms of this Commitment Letter and of the Fee Letters by returning to
the Lead Arrangers (or their designees) counterparts hereof and of the Fee Letters executed by you not later than 11:59 p.m., New York
City time, on the fifth business day following the date of this Commitment Letter (the date of receipt by us of such executed counterparts,
the “Acceptance Date”). Each Commitment Party’s commitments hereunder and agreements contained herein will expire
at such time in the event that such Commitment Party (or its designees) has not received such executed counterparts in accordance with
the immediately preceding sentence. If you do so execute and deliver to us this Commitment Letter and the Fee Letters by all of the parties
hereto and thereto, this Commitment Letter and the commitments and undertakings of each of the Commitment Parties shall remain effective
and available for you until the date that is five (5) business days after the Outside Date (as defined in the Acquisition Agreement as
in effect on the date hereof, but without giving effect to any extension thereof pursuant to Section 9.12(b) of the Acquisition Agreement)
or, if earlier, (a) the date on which the Acquisition Agreement has terminated in accordance with its terms (other than with respect to
provisions therein that expressly survive termination) prior to closing of the Acquisition and/or (b) the date of the consummation of
the Acquisition and payment of the consideration therefor and related transactions (but not, for the avoidance of doubt, prior to the
consummation thereof) with or without the funding or effectiveness of the ABL Facility. Upon the occurrence of any of the events referred
to in the preceding sentence, then the commitments and undertakings of each Commitment Party hereunder with respect to the ABL Facility
will automatically terminate, unless such Commitment Party, in its discretion, agrees to an extension. The termination of any commitment
pursuant to this paragraph will not prejudice your or our rights and remedies in respect of any breach or repudiation of the Commitment
Papers.
[Signature Pages Follow]
| | 17 | Project Norse – Commitment Letter |
We are pleased to have this
opportunity and we look forward to working with you on this transaction.
| |
Very truly yours, |
| |
|
| |
WELLS FARGO BANK, NATIONAL ASSOCIATION |
| |
|
|
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By: |
/s/ Cory Loftus |
| |
Name: |
Cory Loftus |
| |
Title: |
Managing Director |
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|
|
| |
JPMORGAN CHASE BANK, N.A. |
| |
|
|
| |
By: |
/s/ Joon Hur |
| |
Name: |
Joon Hur |
| |
Title: |
Executive Director |
[Signature Page to Project Norse Commitment
Letter]
| Accepted and agreed to as of |
|
| the date first written above: |
|
| |
|
| NORSE HOLDINGS, INC. |
|
| |
|
|
| By: |
/s/ Erik B. Nordstrom |
|
| Name: |
Erik B. Nordstrom |
|
| Title: |
Co-Chief Executive Officer |
|
[Signature Page to Project Norse Commitment
Letter]
Project Norse
$1,200 million ABL Facility
Transaction Description
It is intended that:
(a) The Buyer Group intends to acquire (the “Acquisition”) the Acquired Business pursuant to an Agreement and Plan
of Merger, dated as of the date hereof (together with all exhibits, schedules and disclosure letters thereof, collectively, the “Acquisition
Agreement”) by and among the Company, Holdings and the other parties thereto, pursuant to which, among other things, a wholly-owned
domestic subsidiary of Holdings (“Merger Sub”) will merge (the “Merger”) with and into the Company,
with the Company surviving the Merger as a wholly-owned domestic subsidiary of Holdings.
(b)
The Buyer Group will, directly or indirectly, (i) invest or contribute to Holdings at least 65 million shares of capital stock
of the Acquired Business (the “Rolled Equity”) and (ii) contribute, or cause to be contributed, to Holdings cash of
at least $1,680,000,000 (the “Equity Contribution”), which includes the gross proceeds of the Parent SPV Loan. Holdings
and the Initial Borrower will then, substantially simultaneously with the effectiveness of the ABL Facility, exchange cash for substantially
all the outstanding capital stock of the Acquired Business not already held by Holdings. The aggregate amount of the Equity Contribution,
when combined with the value of the Rolled Equity (valued at the Merger Consideration price) in connection with the Transactions, will
be at least $3,180,000,000 (the “Minimum Equity Contribution”).
(c)
The Borrower will obtain $1,200 million in commitments under a senior secured asset-based credit facility (the “ABL Facility”)
having the terms materially consistent with those set forth in the Summary of Principal Terms and Conditions attached to this Commitment
Letter as Exhibit B (the “Term Sheet”).
(d) The Company’s cash
on hand, the gross proceeds of the Equity Contribution and the initial borrowing under the ABL Facility (if any) will be applied on the
Closing Date to:
(i) pay
the merger consideration to be paid to the holders of shares of Company common stock outstanding immediately prior to the effective time
of the Merger for such shares (other than the shares of Company common stock to be rolled over) pursuant to the terms of the Acquisition
Agreement and pay the dividends contingent upon the occurrence of the closing under the Acquisition Agreement; and
(ii) finance
the repayment of any indebtedness of the Company outstanding under the Company’s existing senior secured credit facility (the “Existing
Credit Facility”; the repayment of any indebtedness under the Existing Credit Facility, together with the termination of the
commitments thereunder and the release of all guarantees, liens and security interests related thereto is referred to herein as the “Refinancing”);
and
(iii) pay
fees, costs and expenses related to the Transactions that are required to be paid at the Closing (such fees, costs and expenses, the “Transaction
Costs”).
The transactions described
above, together with the transactions related thereto, are collectively referred to herein as the “Transactions.” The
Term Sheet, which contain all material terms related to the ABL Facility, are the result of extensive negotiations among the parties hereto.
For purposes of the Commitment Papers, (i) “Acquisition Date” means the date or time that the Acquisition is consummated
pursuant to the terms of the Acquisition Agreement, and (ii) “Closing Date” means the date that the Acquisition Date
occurs and the ABL Facility becomes effective. All references to “dollars” and “$” are to the lawful
currency of the United States of America.
|
| |
| | Project Norse – Exhibit A |
Project
Norse
$1,200
million ABL Facility
Subject
in all respects to the Certain Funds Provisions, the commitments of the Initial ABL Lenders and the Lead Arrangers’ and the ABL
Administrative Agent’s agreements to perform the services described herein are subject to the satisfaction (or waiver by the Lead
Arrangers) of only the following conditions precedent:
1. The
Merger shall have been consummated or will be consummated substantially concurrently with the initial borrowings under the ABL Facility
to be funded on the Closing Date in accordance with the terms of the Acquisition Agreement. Since the date of this Commitment Letter,
the Acquisition Agreement shall not have been amended, supplemented, waived or modified (whether pursuant to your consent or otherwise)
in any respect in a manner that in the aggregate is materially adverse to the Commitment Parties, in their respective capacities as such,
without the consent of the Lead Arrangers (such consent not to be unreasonably withheld, conditioned or delayed); provided that
each Lead Arranger shall be deemed to have consented to such amendment, supplement, waiver or modification unless it shall object in
writing thereto within five business days of receipt of written notice of such amendment, waiver or modification; provided further,
that (i) any reduction in the purchase price under the Acquisition Agreement (or amendment, supplement or modification to the Acquisition
Agreement pursuant to which such reduction is made) exceeding 10% of the total purchase price will be deemed to be materially adverse
to the interests of the Commitment Parties, unless such reduction is applied to reduce the amount of the Equity Contribution until the
Equity Contribution is equal to the Minimum Equity Contribution, then to reduce the Equity Contribution on a pro rata basis, (ii) any
amendment, supplement, modification or waiver to the terms of the Acquisition Agreement that has the effect of increasing the cash purchase
price thereunder to be paid on the Closing Date will not be deemed to be materially adverse to the Commitment Parties if such increase
is funded with common equity or preferred equity on terms reasonably satisfactory to the Lead Arrangers and (iii) any amendment, supplement
or modification to, or waiver with respect to, the definition of “Company Material Adverse Effect,” the definition of “Outside
Date” (or equivalent) or the “Xerox” provisions contained in the Acquisition Agreement (in each case, as in effect
on the date hereof) will be deemed to be materially adverse to the Commitment Parties.
2. The
Equity Contribution and the Refinancing shall have been consummated or shall be consummated substantially concurrently with the initial
borrowing under the ABL Facility to be funded on the Closing Date.
3. There
shall not have occurred and be continuing a Company Material Adverse Effect (as defined in the Acquisition Agreement) that would result
in the failure of a condition precedent to Holdings’ (or its affiliates’) obligation to consummate the Merger under the Acquisition
Agreement or that would give Holdings (or its affiliates) the right pursuant to the terms of the Acquisition Agreement (taking into account
any notice and cure provisions) to terminate the Acquisition Agreement in accordance with its terms.
4. The
Lead Arrangers will have received the Required Financial Statements (as defined in the Acquisition Agreement as in effect on the date
hereof).
5. The
ABL Administrative Agent will have received the following, in each case, containing terms that are consistent with the provisions of
the Term Sheet and subject to the Certain Funds Provision:
| (a) | (i)
a credit agreement, (ii) a customary guarantee agreement and (iii) a customary security agreement
pursuant to which a lien is granted on the Collateral in favor of the ABL Administrative
Agent for the benefit of the ABL Lenders and the other secured parties under the ABL Facility
and ABL Administrative Agent is authorized to file customary “all asset” (or
substantially equivalent) UCC-1 financing statements with respect thereto and as required
thereunder, in each case, executed by Holdings, the Borrower and the other Guarantors, as
and to the extent applicable (such credit, guarantee and security agreements, the “ABL
Facility Documentation”; and |
| (b) | any
certificated securities representing equity of the Initial Borrower and the Company, in the
case of the Company to the extent actually received by you pursuant to the terms of the Acquisition
Agreement on or prior to the Closing Date after your use of commercially reasonable efforts,
with customary stock powers executed in blank. |
6. The
ABL Administrative Agent will have received the following (collectively, the “Closing Deliverables”) in each case
subject to the Certain Funds Provision:
| (a) | customary
legal opinions from your counsel with respect to the ABL Facility; |
| (b) | a
customary officer’s certificate (with certification of organizational documents and
appropriate authorizing resolutions and to the conditions set forth in paragraph 7 of this
Exhibit C with respect to the Specified Representations only) and a customary incumbency
certificate from officers of each of the applicable Loan Parties executing the ABL Facility
Documentation; |
| (c) | good
standing certificates (to the extent applicable) from the Secretary of State or such other
office in the Loan Parties’ respective jurisdictions of organization; |
| (d) | a
solvency certificate substantially in the form attached to the Commitment Letter from the
chief financial officer or other officer with equivalent duties of the Initial Borrower; |
| (e) | a
customary borrowing request with respect to any funding of the ABL Facility to be made on
the Closing Date, which may be delivered on or prior to the Closing Date; and |
| (f) | a
Borrowing Base Certificate; provided that if the Closing Borrowing Base then applies,
such Borrowing Base Certificate shall, in lieu of a description of eligible accounts receivables,
inventory and reserves, only refer to the Borrowing Base as $1.0 billion. |
7. Subject
to the Certain Funds Provision, the accuracy of the Acquisition Agreement Representations and the Specified Representations in all material
respects (except to the extent the Specified Representations are qualified by materiality, in which case such representations shall be
true and correct in all respects after giving effect to such materiality qualifier).
8. The
Initial ABL Lenders will have received at least three business days prior to the Acquisition Date (a) all outstanding documentation and
other information about the Loan Parties required under applicable “know your customer” and anti-money laundering rules and
regulations, including the Patriot Act and (b) to the extent the Borrower qualifies as a “legal entity customer” under the
Beneficial Ownership Regulation, a customary FinCEN beneficial ownership certificate required thereunder, that in each case of clauses
(a) and (b) has been reasonably requested in writing at least ten business days prior to the Acquisition Date.
9. Payment
of fees and expenses due to the Commitment Parties under the Commitment Papers, in the case of expenses and legal fees to the extent
invoiced in reasonable detail at least two business days prior to the Closing Date (except as otherwise reasonably agreed by you), and,
in each case, required to be paid on the Closing Date, it being agreed that such fees and expenses may be paid with the proceeds of the
initial funding under the ABL Facility.
10. Unless
consented to by the Lead Arrangers, the Closing Date shall not occur prior to the date that is 60 days following the execution of this
Commitment Letter.
Form
of Solvency Certificate
Date:
[_____, ____]
To
the ABL Administrative Agent and each of the ABL Lenders
party to the Credit Agreement referred to below:
Pursuant
to Section [__] of the Credit Agreement, the undersigned, solely in the undersigned’s capacity as [chief financial
officer][specify other officer with equivalent duties] of the Borrower, hereby certifies, on behalf of the Borrower
and not in the undersigned’s individual or personal capacity and without personal liability, that, to his or her knowledge, as
of the Closing Date, after giving effect to the Transactions (including the making of the Loans under the Credit Agreement on the Closing
Date and the application of the proceeds thereof):
| (a) | the
fair value of the assets of the Borrower and its Subsidiaries, on a consolidated basis, exceeds
their debts and liabilities, subordinated, contingent or otherwise, on a consolidated basis; |
| (b) | the
present fair saleable value of the property of the Borrower and its Subsidiaries, on a consolidated
basis, is greater than the amount that will be required to pay the probable liability, on
a consolidated basis, of their debts and other liabilities, subordinated, contingent or otherwise,
on a consolidated basis, as such debts and other liabilities become absolute and matured; |
| (c) | the
Borrower and its Subsidiaries, on a consolidated basis, are able to pay their debts and liabilities,
subordinated, contingent or otherwise, on a consolidated basis, as such liabilities become
absolute and matured; and |
| (d) | the
Borrower and its Subsidiaries, on a consolidated basis, are not engaged in, and are not about
to engage in, business as contemplated on the date hereof for which they have unreasonably
small capital. |
For
purposes of this Solvency Certificate, the amount of any contingent liability at any time will be computed as the amount that would reasonably
be expected to become an actual and matured liability. Capitalized terms used but not otherwise defined herein have the meanings assigned
to them in the Credit Agreement.
*
* *
|
|
| |
| | Project Norse – Exhibit D |
IN
WITNESS WHEREOF, the undersigned has executed this Solvency Certificate, solely in the undersigned’s capacity as [chief
financial officer][specify other officer with equivalent duties] of the Borrower, on behalf of the Borrower and
not in the undersigned’s individual or personal capacity and without personal liability, as of the date first stated above.
| |
[Borrower] |
| |
|
| |
By: |
|
| |
|
Name: |
|
| |
|
Title: |
[Chief Financial Officer] |
Exhibit 16(b)(ii)
EXECUTION VERSION
EL PUERTO DE
LIVERPOOL, S.A.B. DE C.V.
December 22, 2024
Norse Holdings, Inc.
c/o Nordstrom, Inc.
1617 Sixth Avenue,
Seattle, Washington 98101
Phone: (206) 628-2111
Attention: Erik Nordstrom
| Re: | Equity Financing Commitment |
Ladies and Gentlemen:
Reference is made
to the Agreement and Plan of Merger, dated as of the date hereof (as amended, restated, modified or supplemented from time to time, the
“Merger Agreement”), by and among Norse Holdings, Inc., a Delaware corporation (“Parent”),
Navy Acquisition Co. Inc., a Washington corporation and an indirect wholly owned subsidiary of Parent (“Merger Sub”),
and Nordstrom, Inc., a Washington corporation (the “Company”), pursuant to which Merger Sub will merge with
and into the Company, with the Company being the surviving corporation, on the terms and subject to the conditions set forth in the Merger
Agreement (the “Merger”). Capitalized terms used and not defined herein but defined in the Merger Agreement
shall have the meanings ascribed to them in the Merger Agreement. This letter is being delivered by El Puerto de Liverpool, S.A.B. de
C.V. (the “Investor”) to Parent in connection with the execution of the Merger Agreement.
1.
Commitment. This letter confirms the commitment of the Investor, subject to the conditions set forth herein, to directly or
indirectly purchase (or cause an assignee permitted by the terms of Section 4(a) to directly or indirectly purchase) common equity
securities (or other securities consistent with the communications and materials referred to in Section 5.7(d) of the Merger Agreement)
of Parent at the Closing for an aggregate amount in cash of $1,712,000,000 (the “Commitment”), solely for the purposes
of, and solely as necessary for, enabling Parent, directly or indirectly, to fund, together with the proceeds of the Debt Financing and
Company Cash on Hand of at least the Company Cash Amount, (a) the Aggregate Merger Consideration pursuant to Section 3.1 of the
Merger Agreement, and (b) pay the other Funding Obligations, in each case, in connection with the Merger and pursuant to and in accordance
with the Merger Agreement.
2. Conditions.
The obligation of the Investor (together with its permitted assigns) to fund its Commitment in accordance with the terms of this
letter is subject to (a) the satisfaction or waiver by Parent of all of the conditions to Parent’s obligation to effect
the Closing set forth in the Merger Agreement (other than those conditions that by their nature are to be satisfied at the Closing,
but subject to the satisfaction or waiver of such conditions), (b) the prior or substantially simultaneous funding of the Debt
Financing or the Debt Financing would be funded substantially simultaneously with the funding of the Equity Financing if the Equity
Financing is funded, in each case in an amount that would result in gross proceeds of at least the Funded Debt Amount, and (c) the
substantially simultaneous consummation of the Closing if the Commitment were funded. The amount to be funded under this letter may
be reduced on the Closing Date in an amount specified by the Investor and agreed to by Parent solely to the extent that,
notwithstanding such reduction, Parent and Merger Sub will consummate the transactions contemplated by the Merger Agreement in
accordance with the terms thereof. Notwithstanding the prior sentence, the amount of the Commitment may not be reduced in a manner
that would impair, delay or prevent the consummation of the transactions contemplated by the Merger Agreement. All payments
hereunder shall be made in lawful money of the United States, in immediately available funds.
3.
Termination. The Investor’s obligation to fund the Commitment will terminate automatically and immediately upon the
earliest to occur of (a) the consummation of the Closing (but only if the Aggregate Merger Consideration pursuant to Section 3.1 of the
Merger Agreement, and the other Funding Obligations, in each case, in connection with the Merger and pursuant to and in accordance with
the Merger Agreement shall have been funded in full in connection therewith), (b) the valid termination of the Merger Agreement pursuant
to its terms, and (c) the commencement of any Action by the Company or any of its controlled Affiliates or any director of the Company
in his or her capacity as such (other than any director that is also a Parent Party) against any Non-Recourse Party (as defined below)
in connection with this letter, the Limited Guaranty, the Merger Agreement or any of the transactions expressly provided hereby or thereby
(including in respect of any oral representations made or alleged to be made in connection therewith), in each case other than any Action
(i) against the Investor (or its permitted assigns) under Section 4(a), Section 4(b), or Section 6 of this letter, (ii) against Parent
or Merger Sub under the Merger Agreement, (iii) against the Investor (or its permitted assigns) under the Limited Guaranty, (iv) against
any party to a Rollover and Support Agreement (or its permitted assigns) under such Rollover and Support Agreement, (v) against the Family
Guarantors (or their permitted assigns) under the Family Limited Guaranty, (vi) against any party to a Confidentiality Agreement (or
its permitted assigns) under such Confidentiality Agreement, or (vii) against any party (or its permitted assigns) to that certain amended
and restated letter agreement, dated as of December 22, 2024, by and among the Company and the Buyer Group party thereto (“Buyer
Group Disbandment Letter”), or that certain letter agreement, dated as of December 22, 2024, by and among the Company and
the Family Guarantors party thereto (together, the “Disbandment Letters”) under such Disbandment Letters. Sections
8, 9 and 10 of this letter shall remain in full force and effect, notwithstanding any termination of this letter.
4. Assignment;
Amendments and Waivers; Entire Agreement.
(a) The
rights and obligations under this letter may not be assigned by any party hereto without the prior written consent of the other parties
hereto and the Company, and any attempted assignment without such consent shall be null and void and of no force or effect. The Company
shall be an express and intended third-party beneficiary of this Section 4(a), may grant consent hereunder in its sole discretion, and
shall be entitled to specifically enforce its rights hereunder, including by obtaining an injunction, or other appropriate form of specific
performance or equitable relief, to prevent any attempted assignment without its consent. Notwithstanding the foregoing, without requiring
any such consent, Investor may assign all or a portion of its obligations to fund its Commitment to one or more Affiliates, so long as
such assignment would not reasonably be expected to (i) prevent, impair or delay the consummation of the transactions contemplated by
the Merger Agreement and by the Financing Commitments and the funding in full of the Commitment or (ii) require any additional consents,
approvals or regulatory filings, the failure of which would prevent, impair or delay the consummation of the transactions contemplated
by the Merger Agreement and by the Financing Commitments and the funding in full of the Commitment; provided, however, that
any such permitted assignment shall not relieve the Investor of any of its obligations under this letter (including its obligation to
fund its Commitment hereunder), except to the extent performed by such Affiliate. Following any valid assignment by the Investor of its
obligations hereunder pursuant to the immediately preceding sentence, the Investor will provide Parent and the Company with written notice
of such assignment. Upon any permitted assignment pursuant to this Section 4(a), such assignee shall be deemed to have given the representations
and warranties set forth in Section 7 of this letter as of the time of such assignment.
(b) This
letter may not be amended, and no provision hereof may be waived or modified, except by an instrument signed by each of the parties hereto
and the Company. Any attempted amendment, waiver or modification of this letter that is not done in compliance with the previous sentence
shall be null and void and of no force or effect. The Company shall be an express and intended third-party beneficiary of this Section
4(b) and shall be entitled to specifically enforce its rights hereunder, including by obtaining an injunction, or other appropriate form
of specific performance or equitable relief, to prevent any attempted amendment, waiver or modification not done in compliance with this
section.
(c) Together
with the Merger Agreement and the other Transaction Documents to which Investor is a party, and the other agreements and instruments contemplated
hereby or thereby, this letter constitutes the entire agreement of the parties hereto and supersedes all prior agreements and understandings,
both written and oral, among or between any of the parties with respect to the subject matter hereof and thereof. The Investor acknowledges
that the Company is entering into the Merger Agreement in reliance on the agreements of the Investor in this letter and that an Intentional
Breach of this letter by the Investor shall constitute an Intentional Breach of Parent under the Merger Agreement, and the Company shall
be entitled to all remedies against Parent and Merger Sub available at law or in equity in accordance with, and subject to the limitations
set forth in, the Merger Agreement.
5.
No Third Party Beneficiaries. Except to the extent expressly set forth in Sections 4(a), 4(b), 6(a),
6(b) and 8, this letter shall be binding solely on, and inure solely to the benefit of, the parties hereto and their respective
successors and permitted assigns, and nothing set forth in this letter shall be construed to confer upon or give to any Person, other
than the parties hereto and their respective successors and permitted assigns, any benefits, rights or remedies under or by reason of,
or any rights to enforce or cause Parent to enforce, the Commitment or any provisions of this letter.
6. Limited
Recourse; Enforcement; Limited Guaranty.
(a) Notwithstanding
anything that may be expressed or implied in this letter or any document or instrument delivered contemporaneously herewith, Parent, by
its acceptance of the benefits of the Commitment provided herein, covenants, agrees and acknowledges that no Person other than the Investor
and its successors and permitted assigns and Parent shall have any obligation, liability or commitment of any nature (whether known or
unknown, whether due or to become due, absolute, contingent or otherwise) hereunder or in connection with the transactions contemplated
hereby and that, notwithstanding that the Investor or any of its successors and permitted assigns or Parent may be a partnership, limited
liability company, private limited company or other type of entity, it has no right of recovery against and no recourse hereunder or under
any documents or instruments delivered in connection herewith, or for any claim (whether in tort, contract or otherwise) based on, in
respect of, or by reason of, this letter, the transactions contemplated hereby or in respect of any oral representations made or alleged
to be made in connection herewith or therewith against, and no personal liability whatsoever shall attach to, be imposed upon or otherwise
be incurred by, the former, current or future equity holders, controlling persons, directors, officers, employees, agents, Affiliates
(other than any assignee permitted under Section 4 hereof or under Section 6 of the Limited Guaranty or under the Family Limited
Guaranty), members, managers or general or limited partners of any of the Investor or any former, current or future stockholder, controlling
person, director, officer, employee, general or limited partner, member, manager, Affiliate (other than any assignee permitted under Section
4 hereof or under Section 6 of the Limited Guaranty or under the Family Limited Guaranty), financing sources or agent of any of the
foregoing and their successors or assigns (collectively, but not including the Investor, Parent and Merger Sub, and their respective successors
and permitted assigns, each a “Non-Recourse Party”), whether by the enforcement of any assessment or by any
legal or equitable proceeding, or by virtue of any applicable Law, it being agreed and acknowledged that no liability whatsoever shall
attach to, be imposed on or otherwise be incurred by any Non-Recourse Party for any obligations of the Investor or any of its successors
or permitted assigns or Parent under this letter or any documents or instrument delivered in connection herewith or in respect of any
oral representations made or alleged to be made in connection herewith or therewith or for any claim (whether at law or equity or in tort,
contract or otherwise) based on, in respect of, or by reason of such obligations or their creation, provided that this sentence shall
not in any respect limit the Company’s rights to assert any Retained Claim (as defined in the Guaranties) against the Person specifically
identified with respect to such Retained Claim, nor shall it limit the liability or obligations of such Person under such Retained Claim,
which liability shall be subject to the limitations applicable to the corresponding Retained Claim. For the avoidance of doubt, this Equity
Commitment Letter shall not restrict, nor shall it be terminated upon or otherwise be impaired by, the Company’s rights to bring
any Action against the Family Group, the Family Guarantors or their respective successors and permitted assigns, including, without limitation,
under the Family Limited Guaranty, the Rollover and Support Agreement to which the Family Group is a party, and the Family Confidentiality
Agreement. The Non-Recourse Parties are hereby made intended third party beneficiaries of this Section 6(a) and may rely on and
enforce the provisions of this Section 6(a).
(b) Parent
shall be entitled to specifically enforce the obligations of Investor to satisfy the Commitment when all of the conditions to funding
the Commitment set forth in this letter have been satisfied or waived or would be satisfied if the Commitment were funded. Subject to
the succeeding sentence, this letter may only be enforced by Parent, and nothing set forth in this letter shall be construed to confer
upon or give to the Company or any other Person (including, without limitation, Parent’s and the Company’s direct and indirect
creditors), any rights to enforce the Commitment or to cause Parent to enforce the Commitment. Notwithstanding the foregoing or anything
to the contrary herein, the Company is an express and intended third party beneficiary of Parent’s rights under this letter and
shall be entitled to specifically enforce the obligations of Investor to fund the Commitment against Investor to the full extent hereof
when all of the conditions to funding the Commitment set forth in this letter have been satisfied or waived or would be satisfied if the
Commitment were funded in connection with the exercise of its rights under and in accordance with Section 9.12 of the Merger Agreement,
and, in connection therewith, the Company shall have the right to obtain an injunction, or other appropriate form of specific performance
or equitable relief, to cause Parent to cause, or to directly cause, Investor to fund, directly or indirectly, the Commitment as, and
only to the extent permitted by, this letter. The exercise by Parent or the Company of any right to enforce this letter does not give
rise to any other remedies, monetary or otherwise, such remedies being limited, as described in Section 6(c) hereof, to those provided
under the Limited Guaranty. The Investor acknowledges and agrees that (i) Parent is delivering a copy of this letter to the Company and
the Company is relying on the third-party beneficiary rights, representations, warranties, obligations and commitments of the Investor
hereunder in connection with the Company’s decision to enter into the Merger Agreement and consummate the transactions contemplated
thereby and (ii) the enforcement rights under this Section 6(b) and Sections 4(a) and 4(b) are an integral part of the transactions contemplated
by the Merger Agreement and without those rights, the Company would not have entered into the Merger Agreement. Each of the Investor and
Parent agree that (x) it will not oppose the granting of an injunction, specific performance and other equitable relief on the basis that
the Company has an adequate remedy at law, including the availability of the Parent Termination Fee, damages in the event an Intentional
Breach of the Merger Agreement, or any other remedies under the Merger Agreement, or that any award of specific performance is not an
appropriate remedy for any reason at law or in equity, and (y) the Company shall not be required to show proof of actual damages or provide
any bond or other security in connection with seeking specific performance under this Section 6(b).
(c) Concurrently
with the execution and delivery of this letter, (i) the Investor is executing and delivering to the Company a Limited Guaranty (as amended
from time to time, the “Limited Guaranty”) relating to certain of Parent’s obligations under the Merger
Agreement and (ii) certain other persons (the “Family Guarantors”) are executing and delivering to the Company
a Limited Guaranty (as amended from time to time, the “Family Limited Guaranty” and collectively with the Limited
Guaranty, the “Guaranties”) relating to certain of Parent’s obligations under the Merger Agreement. The
Company’s remedies pursuant to the Retained Claims shall, and are intended to, be the sole and exclusive direct or indirect remedies
available to the Company and its Affiliates against the Investor and the Non-Recourse Parties for any liability, loss, damages or recovery
of any kind (including consequential, indirect or punitive damages, and whether at law, in equity or otherwise) arising under or in connection
with any liabilities or obligations arising under, or in connection with, the Merger Agreement or the Rollover and Support Agreement (whether
willfully, intentionally, unintentionally or otherwise) or of the failure of the Merger to be consummated or otherwise in connection with
the transactions contemplated hereby and thereby or in respect of any oral representations made or alleged to be made in connection herewith
or therewith, including without limitation in the event Parent (1) breaches its obligations under the Merger Agreement, whether or not
such breach is caused by the Investor’s breach of its obligations under this letter or (2) enforces its rights under the Merger
Agreement. While the Company may pursue both (i) a grant of specific performance or other injunctive relief to cause the Closing to occur
or for a determination that the Merger Agreement has not been validly terminated and (ii) a claim for the payment or contribution of amounts
under the Limited Guaranty, in no event shall the Investor have any obligation to make any payment hereunder at any time after the Investor
(or its assignees), in its capacity as guarantor under the Limited Guaranty, shall have made full payment or contribution of either Reverse
Termination Fee or Intentional Breach damages required to be paid or contributed under the Limited Guaranty after the Company has presented
a claim for payment thereof and, if a claim for specific performance or other injunctive relief is pending (or the Company has indicated
it will pursue a claim for specific performance or injunctive relief), the Company has actually demanded payment thereof to be made prior
to resolution of the claim for specific performance or other injunctive relief and has not conditioned the requirement to make such payment
on the claim for specific performance or other injunctive relief being unsuccessful.
7. Representations
and Warranties. The Investor hereby represents and warrants, solely with respect to itself and not any other Person,
that:
(a) it
is duly organized and validly existing under the Laws of the jurisdiction of its organization and has all necessary power and authority
to execute, deliver and perform its obligations under this letter and the Investor Financing Commitments (as defined below);
(b) the
execution, delivery and performance of this letter and the Investor Financing Commitments, and the consummation of the Investor Financing
(as defined below), have been duly and validly authorized by all necessary action and do not (i) contravene any provision of the Investor’s
charter, bylaws (estatutos sociales), partnership agreement, operating agreement or similar organizational documents, (ii) conflict
with or violate any applicable Law, regulation, rule, decree, order, or judgment or (iii) result in any breach of, or constitute a default
(with or without notice or lapse of time, or both) under, or give rise to any right of termination, acceleration or cancellation of any
contractual restriction applicable to the Investor, its Subsidiaries or their respective assets or properties;
(c) all
consents, approvals, authorizations, permits of, filings with and notifications to, any Governmental Authority necessary for the due execution,
delivery and performance of this letter and the Investor Financing Commitments by the Investor, and the consummation of the Investor Financing,
have been obtained or made and all conditions thereof have been duly complied with, and no other action by, and no notice to or filing
with, any Governmental Authority is required in connection with the execution, delivery or performance of this letter or the Investor
Financing Commitments or the consummation of the Investor Financing;
(d) this
letter has been duly and validly executed and delivered by it and, assuming due and valid authorization, execution and delivery of this
letter by the other parties hereto, this letter constitutes a legal, valid and binding obligation of it, enforceable against it in accordance
with the letter’s terms, except as may be limited by: (i) the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar Laws affecting creditors’ rights generally, and (ii) general equitable principles (whether considered
in a proceeding in equity or at law); and
(e) (i)
it has and will have through the earlier of the valid termination of this letter and the full funding of the Commitment the financial
capacity to pay the full amount of the Commitment and perform all of its obligations under this letter, (ii) it has available unrestricted
cash on hand or available firm financing commitments (the “Investor Financing Commitments”), true, correct and
complete copies of which have been made available to the Company, to pay the full amount of the Commitment and fulfill its obligations
under this letter, (iii) there are no conditions precedent or other contingencies to obtaining the full net proceeds of the financing
under the Investor Financing Commitments (the “Investor Financing”) except as expressly set forth therein, and
(iv) it will have unrestricted cash on hand available to pay the full amount of the Commitment and fulfill its obligations under this
letter at the Closing.
8.
Confidentiality. This letter shall be treated as confidential and is being provided to Parent solely in connection with the
Merger Agreement. This letter may not be used, circulated, quoted or otherwise referred to in any document, except with the written consent
of the Investor; provided that no such written consent shall be required for any disclosure of the existence or terms of this
letter to the parties to the Merger Agreement or their Representatives with a need to know in connection with the transactions contemplated
by the Merger Agreement, to the extent required by applicable Law or the applicable rules of any national securities exchange, to the
Rating Agencies, in connection with the Company’s and Parent’s filings with the SEC relating to the transactions contemplated
by the Merger Agreement, or if required in connection with any required filing or notice with any Governmental Authority relating to
the transactions contemplated by the Merger Agreement. The Company will permit the Investor the opportunity to comment on any such required
disclosure to the extent practicable, which the Company will consider in good faith (it being agreed that by providing Parent an opportunity
to comment on such required disclosure, the Company will be deemed to have provided the Investor the opportunity to comment on such required
disclosure). Following the filing of this letter with the SEC, the parties and the Company shall have no obligations pursuant to the
first two sentences of this Section 8.
9.
Notices. All notices, requests and other communications to any party hereunder shall be in writing (including electronic mail
(“e-mail”) transmission) and shall be given:
(a) If
to the Investor:
c/o El Puerto de Liverpool,
S.A.B. de C.V.
Mario Pani No. 200,
Col. Santa Fe Cuajimalpa
Cuajimalpa, CDMX CP 05348
| Attention: | Gonzalo Gallegos |
| | | Jacobo Apichoto |
| Email: | ggallegosm@liverpool.com.mx |
| | | japichoto@liverpool.com.mx |
with copies (which shall not
constitute actual or constructive notice) to:
Simpson Thacher & Bartlett
LLP
425 Lexington Avenue
New York, NY 10017
| |
Attention: |
Benjamin P.
Schaye |
| |
|
Juan
F. Méndez |
| |
E-mail: |
ben.schaye@stblaw.com |
| |
|
jmendez@stblaw.com |
(b) If
to Parent:
c/o Nordstrom, Inc.
1617 Sixth Avenue,
Seattle, Washington 98101
Phone: (206) 628-2111
Attention: Erik Nordstrom
with a copy (which shall not
constitute actual or constructive notice) to:
Wilmer Cutler Pickering Hale & Dorr LLP
7 World Trade Center
250 Greenwich Street
New York, NY 10007
| |
Attention: |
Keith Trammell |
| |
|
Michael
Gilligan |
| |
E-mail: |
Keith.Trammell@wilmerhale.com |
| |
|
Michael.Gilligan@wilmerhale.com |
and
Simpson Thacher & Bartlett
LLP
425 Lexington Avenue
New York, NY 10017
| |
Attention: |
Benjamin P.
Schaye |
| |
|
Juan
F. Méndez |
| |
E-mail: |
ben.schaye@stblaw.com |
| |
|
jmendez@stblaw.com |
(c) If
to the Company:
Nordstrom, Inc.
1617 Sixth Avenue
Seattle, Washington, 98101
| Attention: | Ann Munson Steines, Chief Legal Officer, General Counsel and Corporate Secretary |
| | E-mail: | Ann.Steines@nordstrom.com |
with a copy (which shall not
constitute actual or constructive notice) to:
Sidley Austin LLP
1001 Page Mill Road Building 1
Palo Alto, California 94304
Phone: (650) 565-7000
| |
Email: |
dzaba@sidley.com |
| |
Attention: |
Derek Zaba |
and
Sidley Austin LLP
One South Dearborn
Chicago, Illinois 60603
Phone: (312) 853-7000
| |
Email: |
ggerstman@sidley.com |
| |
|
swilliams@sidley.com |
| |
Attention: |
Gary Gerstman |
| |
|
Scott R. Williams |
or such other address or email address
as such party may hereafter specify for the purpose by notice to the other parties hereto. All notices and other communications hereunder
must be in writing and will be deemed to have been duly delivered and received hereunder (i) one Business Day after being sent for
next Business Day delivery, fees prepaid, via a reputable nationwide overnight courier service or (ii) immediately upon delivery
by electronic mail or by hand (with a written or electronic confirmation of delivery). Any notice received at the addressee’s location
on any Business Day after 5:00 p.m., addressee’s local time, or on any day that is not a Business Day will be deemed to have been
received at 9:00 a.m., addressee’s local time, on the next Business Day. From time to time, any party may provide notice to the
other parties and the Company of a change in its address or e-mail address through a notice given in accordance with this Section 9,
except that that notice of any change to the address or any of the other details specified in or pursuant to this Section 9 will
not be deemed to have been received until, and will be deemed to have been received upon, the later of the date (A) specified in
such notice; or (B) that is five Business Days after such notice would otherwise be deemed to have been received pursuant to this
Section 9.
10. Governing
Law; Jurisdiction; Waiver of Jury Trial.
(a) Except
to the extent the Laws of the State of Washington are mandatorily applicable, this letter and all Actions (whether based on Contract,
tort or otherwise) arising out of or relating to this letter or the actions of the Investor, Parent or the Company in the negotiation,
administration, performance and enforcement thereof, shall be governed by, and construed in accordance with the laws of the State of Delaware,
without giving effect to any choice or conflict of laws provision or rule (whether of the State of Delaware or any other jurisdiction)
that would cause the application of the Laws of any jurisdiction other than the State of Delaware.
(b) Each
of the parties hereto hereby (i) expressly and irrevocably submits to the exclusive personal jurisdiction of the state courts of the Delaware
Court of Chancery, any other court of the State of Delaware or any federal court sitting in the State of Delaware, in the event any dispute
arises out of or relates to this letter or the transactions contemplated hereby, (ii) agrees that it will not attempt to deny or
defeat such personal jurisdiction by motion or other request for leave from any such court, (iii) agrees that it will not bring any Action
relating to this letter or the transactions contemplated hereby in any court other than the Delaware Court of Chancery, any other court
of the State of Delaware or any federal court sitting in the State of Delaware, (iv) waives, to the fullest extent it may legally and
effectively do so, any objection which it may now or hereafter have to the laying of venue of any Action arising out of or relating to
this letter and (e) agrees that each of the other parties hereto (and the Company as a third party beneficiary hereunder) shall have the
right to bring any Action for enforcement of a judgment entered by the state courts of the Delaware Court of Chancery, any other court
of the State of Delaware or any federal court sitting in the State of Delaware. Each of the Investor, Parent and Merger Sub agrees that
a final judgment in any Action shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by Law, and the Investor consents to such enforcement and covenants not to oppose such enforcement in any jurisdiction.
The Investor hereby appoints Cogency Global Inc. as its authorized agent (the “Authorized Agent”) upon whom
process may be served in any Action arising out of or relating to this letter or the transactions contemplated hereby that may be instituted
in the Delaware Court of Chancery, any other court of the State of Delaware or any federal court sitting in the State of Delaware by the
parties hereto (and the Company as a third party beneficiary hereunder), and service of process on the Authorized Agent shall be deemed
effective service of process upon the Investor.
(c) EACH PARTY HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION (WHETHER BASED ON CONTRACT, TORT
OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS LETTER OR ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS LETTER OR THE ACTIONS OF THE
INVESTOR, PARENT, OR THE COMPANY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF. EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH PARTY WOULD NOT, IN THE
EVENT OF ANY ACTION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED
TO ENTER INTO THIS LETTER BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS section
10(c).
11.
Counterparts; Interpretation. This letter and any amendments or waivers hereto may be executed in one or more counterparts,
all of which will be considered one and the same letter and will become effective when one or more counterparts have been signed by each
party hereto (and the Company, if applicable) and delivered to the other parties hereto (and the Company, if applicable), it being understood
that all parties (and the Company, if applicable) need not sign the same counterpart. Any such counterpart, to the extent delivered by
fax or .pdf, .tif, .gif, .jpg or similar attachment to electronic mail (any such delivery, an “Electronic Delivery”),
will be treated in all manner and respects as an original executed counterpart and will be considered to have the same binding legal
effect as if it were the original signed version thereof delivered in person. No party hereto may raise the use of an Electronic Delivery
to deliver a signature, or the fact that any signature or agreement or instrument was transmitted or communicated through the use of
an Electronic Delivery, as a defense to the formation of a contract, and each party hereto forever waives any such defense, except to
the extent such defense relates to lack of authenticity. Section 9.3(c) of the Merger Agreement is incorporated by reference herein,
mutatis mutandis.
12. Severability.
If any term, provision, covenant or restriction of this letter is held by a court of competent jurisdiction or other Governmental
Authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this letter
shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such a
determination, the parties shall negotiate in good faith to modify this letter so as to effect the original intent of the parties as
closely as possible in an acceptable manner in order that the transactions contemplated hereby be consummated as originally
contemplated to the fullest extent possible. Notwithstanding the foregoing, the parties intend that the remedies and limitations
thereon contained in this letter, including Section 6 hereof, be construed as an integral provision of this letter and that such
remedies and limitations shall not be severable in any manner that increases liability or obligations hereunder of any party hereto
or of the Investor or of any Non-Recourse Party.
13. No
Partnership. Parent acknowledges and agrees that this letter is not intended to, and do
not, create any agency, partnership, fiduciary or joint venture relationship between or among the Investor and the other Parent
Parties and neither this letter, nor any other document or agreement entered into by any party hereto or thereto, as applicable,
relating to the subject matter hereof shall be construed to suggest otherwise.
[Remainder of
page intentionally left blank]
| |
Very truly yours, |
| |
|
| |
INVESTOR |
| |
|
| |
EL PUERTO DE LIVERPOOL, S.A.B. DE C.V. |
| |
|
| |
By: |
/s/ Graciano Francisco Guichard González |
| |
Name: |
Graciano Francisco Guichard González |
| |
Title: |
Chairman of the Board |
| |
|
|
| |
By: |
/s/ Enrique Güijosa Hidalgo |
| |
Name: |
Enrique Güijosa Hidalgo |
| |
Title: |
Chief Executive Officer |
[Signature
Page to Equity Commitment Letter]
| Accepted and acknowledged: |
|
| |
|
| PARENT |
|
| |
|
| norse holdings, inc. |
|
| |
|
| By: |
/s/ Erik B. Nordstrom |
|
| Name: |
Erik B. Nordstrom |
|
| Title: |
Co-Chief
Executive Officer
|
|
[Signature
Page to Equity Commitment Letter]
Exhibit 16(b)(iii)
EXECUTION
VERSION
LIMITED
GUARANTY
This
LIMITED GUARANTY is dated as of December 22, 2024 (this “Limited Guaranty”), and is by the natural
persons and trusts set forth on Exhibit A hereto (each, a “Guarantor” and collectively, the “Guarantors”),
in favor of Nordstrom, Inc. (the “Company” or the “Guaranteed Party”).
1.
Limited Guaranty.
(a)
To induce the Guaranteed Party to enter into the Agreement and Plan of Merger (as amended, restated, supplemented or otherwise modified
from time to time, the “Merger Agreement”) entered into concurrently herewith by and among Norse Holdings,
Inc., a Delaware corporation (“Parent”), Navy Acquisition Co. Inc., a Washington corporation and an indirect
wholly owned subsidiary of Parent (“Merger Sub”), and the Company, each Guarantor, intending to be legally
bound, hereby absolutely, irrevocably and unconditionally, severally and not jointly as set forth in Section 15 below, guarantees to
the Guaranteed Party, on the terms and subject to the conditions set forth herein, the due and punctual payment and performance when
due of an amount equal to its Pro Rata Percentage (as defined below) of 50% of the Obligations set forth under clauses (i), (ii), (iii),
(iv) and (v) of the definition thereof and 100% of the Obligations set forth under clause (vi) of the definition thereof (such percentages,
as applicable, the “Aggregate Guarantor Proportion”); provided that, if the Guaranteed Party is enforcing
its rights under both this Limited Guaranty and the Liverpool Limited Guaranty (as defined below) in the same Action, the Aggregate Guarantor
Proportion with respect to the Obligations set forth under clause (vi) of the definition thereof shall be 50%. For purposes of this Limited
Guaranty, the “Obligations” shall mean, collectively:
(i)
the Base Reverse Termination Fee payable by Parent to the Guaranteed Party pursuant to Section 8.3(b) of the Merger Agreement;
(ii)
the Downgrade Reverse Termination Fee payable by Parent to the Guaranteed Party pursuant to Section 8.3(b) of the Merger Agreement;
(iii)
all amounts payable by Parent under and in accordance with the terms of the Merger Agreement or a Rollover and Support Agreement (as
applicable) in the event of an Intentional Breach (except for any amounts payable in respect of the obligations referred to in clause
(iv), (v) and (vi));
(iv)
all amounts payable in respect of Parent’s obligations to pay costs, expenses and interest pursuant to Section 8.3(h) of the Merger
Agreement;
(v)
all amounts payable in respect of Parent’s expense reimbursement and indemnification obligations pursuant to Section 6.12(e) and
(f) of the Merger Agreement; and
(vi)
the costs and expenses incurred by the Guaranteed Party in connection with enforcing its rights under this Limited Guaranty;
provided
that in no event shall the Guarantors’ aggregate liability under this Limited Guaranty with respect to the Obligations exceed:
(A)
with respect to the Obligations set forth under clause (i) of the definition thereof, $85,000,000;
(B)
with respect to the Obligations set forth under clause (ii) of the definition thereof, $50,000,000;
(C)
with respect to the Obligations set forth under clauses (i), (ii) and (iii) of the definition thereof, $150,000,000 in the aggregate;
and
(D)
with respect to the Obligations set forth under clauses (iv), (v) and (vi) of the definition thereof, $20,000,000 in the aggregate (each
such cap, as applicable, the “Cap”);
provided
further that in no event shall a Guarantor’s aggregate liability under this Limited Guaranty with respect to the Obligations
exceed its Pro Rata Percentage of the applicable Cap (such amount with respect to a Cap, the “Pro Rata Cap”).
(b)
The parties acknowledge and agree that (x) a particular clause of the definition of Obligations may be, and in certain cases is, subject
to multiple Caps and (y) once a Guarantor’s aggregate liability with respect to any particular clause of the definition of
Obligations exceeds the Pro Rata Cap applicable to such clause, such Guarantor shall have no further liability with respect to such clause
notwithstanding the fact other Pro Rata Caps to which such clause is also subject may not have been exceeded but may have further liability
with respect to Obligations set forth under other clauses of the definition up to the Pro Rata Cap applicable to such clause. The parties
agree that this Limited Guaranty may not be enforced against any Guarantor without giving effect to the applicable Pro Rata Caps. The
Guaranteed Party hereby agrees that in no event shall a Guarantor be required to pay to the Guaranteed Party or any of its controlled
Affiliates or any director of the Company, in each case in his or her capacity as such (other than any director that is also a Parent
Party), under, in respect of, or in connection with, this Limited Guaranty, the Merger Agreement or any other Transaction Document any
amounts other than as expressly set forth herein (including, for the avoidance of doubt, pursuant to the Retained Claims). All payments
hereunder shall be made in lawful money of the United States, in immediately available funds. Each capitalized term used and not defined
herein shall have the meaning ascribed to it in the Merger Agreement, except as otherwise provided herein.
(c)
In connection with the execution of the Merger Agreement, the Guaranteed Party has received a Limited Guaranty (the “Liverpool
Limited Guaranty”), dated the date hereof, from El Puerto de Liverpool S.A.B. de C.V. (“Liverpool”).
Notwithstanding anything set forth herein to the contrary: (i) the obligations of the Guarantors under this Limited Guaranty, on the
one hand, and of Liverpool under the Liverpool Limited Guaranty, on the other hand, shall be several and not joint or joint and several,
(ii) the Guaranteed Party shall be entitled to enforce each Guarantor’s Pro Rata Percentage of the Aggregate Guarantor Proportion
of the Obligations against such Guarantor (and its permitted assigns) if and only to the extent that the Guaranteed Party has, substantially
concurrently with the enforcement of this Limited Guaranty, sought to enforce all or the same portion of the liabilities due under the
Liverpool Limited Guaranty (except for such amounts that have been paid), it being acknowledged that the actual payment of some or all
of such portion by Liverpool shall not be a condition to the payment of any Guarantor’s Pro Rata Percentage of the Aggregate Guarantor
Proportion of the Obligations (so long as enforcement is being sought therefor), and (iii) the Guaranteed Party shall not enter into
any agreement with Liverpool (or its permitted assigns) modifying the amount, timing or other terms of the payment of the portion of
the obligations payable under the Liverpool Limited Guaranty (a “Modified Payment Agreement”) unless the Guaranteed
Party offers to enter into an agreement with the Guarantors (or their permitted assigns) providing for substantively the same modifications
contemplated by the applicable Modified Payment Agreement and a return of any payments made by the Guarantors (or their permitted assigns)
under this Limited Guaranty prior to such agreement to the extent such payments would not have been payable under such agreement.
2.
Nature of Guaranty. The Guaranteed Party shall not be obligated to file any claim relating to the Obligations in the event
that Parent or Merger Sub becomes subject to a bankruptcy, reorganization or similar proceeding, and the failure of the Guaranteed Party
to so file shall not affect any Guarantor’s obligations hereunder. In the event that any payment to the Guaranteed Party in respect
of the Obligations is rescinded or must otherwise be returned, for any reason whatsoever (other than as set forth in the first sentence
of Section 8(b) hereof), each Guarantor shall remain liable hereunder with respect to such Guarantor’s Pro Rata Percentage of the
Aggregate Guarantor Proportion of the Obligations (subject to the applicable Pro Rata Caps) as if such payment had not been rescinded
or returned. This Limited Guaranty is an unconditional guaranty of payment and not of collection. Subject to Section 1(c)(ii), the Guaranteed
Party may, in its sole discretion, bring and prosecute a separate Action or Actions against each Guarantor for the full amount of such
Guarantor’s Pro Rata Percentage of the Aggregate Guarantor Proportion of the Obligations (subject to the applicable Pro Rata Caps),
regardless of whether an Action for payment is also brought against Parent or Merger Sub, the other Guarantors or any other Person or
whether Parent or Merger Sub, the other Guarantors or any other Person is joined in any such Action or Actions.
3.
Changes in Obligations; Certain Waivers.
(a)
Each Guarantor agrees that the Guaranteed Party may at any time and from time to time, without notice to or further consent of the Guarantors,
extend the time of payment of any of the Obligations (or any portion thereof), and may also make any agreement with Parent, Merger Sub
or any other Person (other than Liverpool, except in compliance with Section 1(c)(iii)) interested in the transactions contemplated by
the Merger Agreement, for the extension, renewal, payment, compromise, discharge or release of the Obligations or liability for the Obligations,
in whole or in part, or with Parent and Merger Sub for any modification of the terms of the Merger Agreement, without in any way releasing,
discharging, impairing or affecting the Guarantors’ obligations under this Limited Guaranty or affecting the validity or enforceability
of the Limited Guaranty. Subject to clauses (ii) and (iii) of Section 1(c), each Guarantor agrees that its obligations hereunder shall
not be released or discharged, in whole or in part, or otherwise impaired or affected by:
(i)
the failure or delay on the part of the Guaranteed Party to assert any claim or demand or to enforce any right or remedy against Parent
or Merger Sub or any other Person interested in the transactions contemplated by the Merger Agreement;
(ii)
any change in the time, place, manner or terms of payment of any of the Obligations or any rescission, waiver, compromise, consolidation
or other amendment to or modification of any of the terms or provisions of the Merger Agreement made in accordance with the terms thereof
or any other agreement evidencing, securing or otherwise executed in connection with any of the Obligations;
(iii)
the existence of any claim, set-off, deduction, defense or release that any Guarantor could assert against Parent or Merger Sub, Liverpool,
the other Guarantors or any other Person interested in the transactions contemplated by the Merger Agreement, whether in connection with
the Merger Agreement and the Obligations or otherwise;
(iv)
the addition, substitution, discharge or release of any other Person now or hereafter liable with respect to any of the Obligations or
otherwise interested in the transactions contemplated by the Merger Agreement;
(v)
any change in the structure or ownership of Parent or Merger Sub, Liverpool, the other Guarantors or any other Person now or hereafter
liable with respect to any of the Obligations or otherwise interested in the transactions contemplated by the Merger Agreement;
(vi)
any insolvency, bankruptcy, reorganization or other similar proceeding affecting Parent, Merger Sub, Liverpool, the other Guarantors,
or any other Person now or hereafter liable with respect to any of the Obligations or otherwise interested in the transactions contemplated
by the Merger Agreement;
(vii)
the right by statute or otherwise to require the Guaranteed Party to institute suit against Parent or Merger Sub or any other Person
or to exhaust any rights or remedies which the Guaranteed Party has or may have against Parent or Merger Sub or any other Person;
(viii)
the adequacy of any other means the Guaranteed Party may have of obtaining payment or other remedy related to any of the Obligations;
or
(ix)
any action or inaction on the part of the Guaranteed Party that is not in violation of the terms of the Merger Agreement or this Limited
Guaranty, including, without limitation, the absence of any attempt to assert any claim or demand against Parent or collect the Obligations
from any or all of Parent, the Guarantors, and Liverpool.
(b)
To the fullest extent permitted by applicable Law, each Guarantor hereby expressly waives any and all rights or defenses arising by reason
of any Law which would otherwise require any election of remedies by the Guaranteed Party. Each Guarantor waives promptness, diligence,
notice of the acceptance of this Limited Guaranty and of the Obligations, presentment, demand for payment, notice of non-performance,
default, dishonor and protest, notice of any Obligations incurred and all other notices of any kind (other than notices expressly required
to be provided to Parent or Merger Sub pursuant to the Merger Agreement), all defenses that may be available by virtue of any valuation,
stay, moratorium, or other applicable Law now or hereafter in effect, any right to require the marshalling of assets of Parent or any
other Person now or hereafter liable with respect to any of the Obligations or otherwise interested in the transactions contemplated
by the Merger Agreement, and all suretyship defenses generally (other than defenses to the payment of the Obligations that are available
to Parent or Merger Sub under the Merger Agreement or a breach by the Guaranteed Party of Section 1(c) or Section 3(c) of this Limited
Guaranty). Each Guarantor acknowledges that it will receive substantial direct and indirect benefits from the transactions contemplated
by the Merger Agreement and that this Limited Guaranty, including specifically the waivers set forth in this Limited Guaranty, are knowingly
made in contemplation of such benefits. The Obligations shall conclusively be deemed to have been created, contracted or incurred in
reliance upon this Limited Guaranty, and all dealings between Parent or the Guarantors, on the one hand, and the Guaranteed Party, on
the other hand, shall likewise be conclusively presumed to have been had or consummated in reliance upon this Limited Guaranty.
(c)
The Guaranteed Party hereby covenants and agrees that it shall not institute, directly or indirectly, and shall cause its controlled
Affiliates and each Company director in his or her capacity as such (other than any director that is also a Parent Party), not to institute,
any Action arising under, or in connection with, the Merger Agreement, the transactions contemplated thereby, or the Equity Commitment
Letter (as defined below), in each case against the Guarantors or any Non-Recourse Party (as defined in Section 9 herein),
except for any Action (i) against the Guarantors (or their permitted assigns) under this Limited Guaranty (subject to the limitations
described herein), (ii) against Liverpool (or its permitted assigns) under Sections 4(a), 4(b) or 6 of the equity commitment letter between
Liverpool and Parent dated the date hereof (the “Equity Commitment Letter”), (iii) against any party (or its
permitted assigns) to a Rollover and Support Agreement under such Rollover and Support Agreement, (iv) against Liverpool (or its permitted
assigns) under the Liverpool Limited Guaranty, (v) against any party (or its permitted assigns) to a Confidentiality Agreement under
such Confidentiality Agreement, or (vi) against any party (or its permitted assigns) to that certain amended and restated letter agreement,
dated as of December 22, 2024, by and among the Company and the Buyer Group party thereto (the “Buyer Group Disbandment Letter”),
or that certain letter agreement, dated as of December 22, 2024, by and among the Company and Guarantors (together, the “Disbandment
Letters”) under such Disbandment Letters (the claims in clauses (i) through (vi), the “Retained Claims”).
Each Guarantor hereby covenants and agrees that it shall not institute, directly or indirectly, and shall cause its controlled Affiliates
not to institute, any Action asserting that this Limited Guaranty, the Liverpool Limited Guaranty, any Rollover and Support Agreement,
the Equity Commitment Letter, the Disbandment Letters or the Merger Agreement is illegal, invalid or unenforceable in accordance with
their respective terms.
(d)
Each Guarantor hereby unconditionally waives any rights that it may now have or hereafter acquire against the Parent or Merger Sub that
arise from the existence, payment, performance, or enforcement of such Guarantor’s obligations under or in respect of this Limited
Guaranty or any other agreement in connection herewith, including any right of subrogation, reimbursement, exoneration, contribution
or indemnification and any right to participate in any claim or remedy of the Guaranteed Party against Parent, whether or not such claim,
remedy or right arises in equity or under contract, statute or applicable Law, including the right to take or receive from Parent or
such other Person, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account
of such claim, remedy or right, unless and until all of the Obligations and all other amounts payable under this Limited Guaranty (subject
to the applicable Caps) and all Obligations (as defined under the Liverpool Limited Guaranty) and all other amounts payable under the
Liverpool Limited Guaranty shall have been previously paid in immediately available funds. If any amount shall be paid to a Guarantor
in violation of the immediately preceding sentence at any time prior to the payment in full in immediately available funds of the Obligations
and all other amounts payable under this Limited Guaranty (subject to the applicable Caps), such amount shall be received and held in
trust for the benefit of the Guaranteed Party, shall be segregated from other property and funds of such Guarantor and shall forthwith
be paid or delivered to the Guaranteed Party in the same form as so received (with any necessary endorsement or assignment) to be credited
and applied to the Obligations and other amounts payable under this Limited Guaranty and the Liverpool Limited Guaranty, whether matured
or unmatured, or to be held as collateral for any Obligations or other amounts payable under this Limited Guaranty thereafter arising
(subject to the applicable Caps).
(e)
Notwithstanding anything to the contrary contained in this Limited Guaranty, the Guaranteed Party hereby agrees that: (i) to the extent
Parent is relieved of any portion of the Obligations, the Guarantors and Liverpool shall each be similarly relieved of a proportional
amount of their obligations under this Limited Guaranty and the Liverpool Limited Guaranty (as applicable) and (ii) each Guarantor may
assert, as a defense to, or release or discharge of, any payment or performance by such Guarantor under this Limited Guaranty, any claim,
set off, deduction, defense that Parent could assert against the Company under the terms of the Merger Agreement or for a breach by the
Guaranteed Party of Section 1(c) or Section 3(c) of this Limited Guaranty.
4.
No Waiver; Cumulative Rights. No failure on the part of the Guaranteed Party to exercise, and no delay in exercising, any
right, remedy or power hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the Guaranteed Party
of any right, remedy or power hereunder preclude any other or future exercise of any right, remedy or power hereunder. Each and every
right, remedy and power hereby granted to the Guaranteed Party shall be cumulative and not exclusive of any other right, remedy or power,
and may be exercised by the Guaranteed Party at any time or from time to time. For the avoidance of doubt, this Limited Guaranty shall
not restrict, nor shall it be terminated upon or otherwise be impaired by, the Guaranteed Party’s rights to bring any Action against
Parent and Merger Sub under the Merger Agreement. The Guaranteed Party shall not have any obligation to proceed at any time or in any
manner against, or exhaust any or all of the Guaranteed Party’s rights against, Parent or Merger Sub, Liverpool (subject to Section
1(c)(ii)), or any other Person prior to proceeding against any Guarantor hereunder. For the avoidance of doubt, and notwithstanding anything
to the contrary contained herein, the Guaranteed Party expressly hereby acknowledges that: (a) the only manner in which the Guaranteed
Party or any of its Affiliates can obtain any form of money damages or other remedy against any Guarantor or any Non-Recourse Party with
respect to the Merger Agreement, the Rollover and Support Agreement to which the Guarantors are a party, the Equity Commitment Letter,
this Limited Guaranty or any transactions contemplated hereby and thereby is (i) monetary damages or other remedies pursuant to the provisions
of, as applicable, this Limited Guaranty, the Liverpool Limited Guaranty, the Confidentiality Agreements, and the Disbandment Letters
and (ii) specific performance, an injunction or other equitable remedies that the Guaranteed Party is entitled to in accordance with
the express terms and conditions of, as applicable, the Equity Commitment Letter, the Rollover and Support Agreements, the Confidentiality
Agreements, and the Disbandment Letters, and (b) under no circumstances will it be permitted or entitled to receive both (x) a grant
of specific performance under the express terms and conditions of the Merger Agreement, the Equity Commitment Letter and the Rollover
and Support Agreements that results in the occurrence of the Closing and (y) money damages under the Merger Agreement and this Limited
Guaranty.
5.
Representations and Warranties. Each Guarantor hereby represents and warrants that:
(a)
it is duly organized and validly existing under the Laws of the jurisdiction of its organization (if it is not a natural person) and
has all necessary power and authority to execute, deliver and perform its obligations under this Limited Guaranty;
(b)
the execution, delivery and performance of this Limited Guaranty have been duly and validly authorized (in the case of a Guarantor who
is not a natural person) by all necessary action, and do not (i) in the case of a Guarantor that is a trust, require the consent of any
beneficiary or contravene any provision of such Guarantor’s trust agreement or similar organizational documents, (ii) conflict
with or violate any applicable Law, regulation, rule, decree, order, or judgment or (iii) result in any breach of, or constitute a default
(with or without notice or lapse of time, or both) under, or give rise to any right of termination, acceleration or cancellation of any
contractual restriction applicable to such Guarantor or its assets or properties;
(c)
all consents, approvals, authorizations, permits of, filings with and notifications to, any Governmental Authority necessary for the
due execution, delivery and performance of this Limited Guaranty by such Guarantor have been obtained or made and all conditions thereof
have been duly complied with, and no other action by, and no notice to or filing with, any Governmental Authority is required in connection
with the execution, delivery or performance of this Limited Guaranty;
(d)
this Limited Guaranty has been duly and validly executed and delivered by it and, assuming due and valid authorization, execution and
delivery of this Limited Guaranty by the Guaranteed Party, this Limited Guaranty constitutes a legal, valid and binding obligation of
it, enforceable against it in accordance with its terms, except as may be limited by: (i) the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar Laws affecting creditors’ rights generally, and (ii) general equitable
principles (whether considered in a proceeding in equity or at law); and
(e)
such Guarantor has the financial capacity to pay and perform its obligations under this Limited Guaranty, and all funds necessary for
such Guarantor to fulfill its obligations under this Limited Guaranty are and shall be available to such Guarantor for so long as this
Limited Guaranty shall remain in effect in accordance with Section 8 hereof.
6.
No Assignment. This Limited Guaranty may not be assigned by any party (except by operation of applicable Laws) without the
prior written consent of the Guaranteed Party (in the case of assignments by a Guarantor) or the Guarantors (in the case of an assignment
by the Guaranteed Party); provided, however, that, without the prior written consent of the Guaranteed Party, a Guarantor
may assign its obligation with respect to the Obligations under this Limited Guaranty to one or more of its Affiliates, so long as such
assignment would not reasonably be expected to (i) prevent, impair or delay the consummation of the transactions contemplated by the
Merger Agreement or the payment and performance in full of the Obligations or (ii) require any additional consents, approvals or regulatory
filings, the failure of which would prevent, impair or delay the consummation of the transactions contemplated by the Merger Agreement
or the payment and performance in full of the Obligations; provided, further however, that any such permitted assignment
shall only relieve the assigning Guarantor of any of its obligations under this Limited Guaranty (including the Obligations) to the extent
that such assignee has actually performed such obligations (including full payment and performance of the Obligations). Following any
valid assignment by a Guarantor of its obligations hereunder pursuant to the immediately preceding sentence, such Guarantor will provide
the Guaranteed Party with written notice of such assignment. Upon any permitted assignment pursuant to this Section 6, such assignee
shall be deemed to have given the representations and warranties set forth in Section 5 of this Limited Guaranty as of the time of such
assignment. Subject to the foregoing, this Limited Guaranty shall survive the dissolution, death or incapacity of any Guarantor, and
shall be binding upon any Guarantor’s heirs, successors, legal representatives and permitted assigns. Any attempted assignment
in violation of this section shall be null and void.
7.
Notices. All notices, requests, claims, demands and other communications hereunder shall be given by the means specified in
the Merger Agreement (and shall be deemed given as specified therein), as follows:
(a)
if to the Guarantors, to the addresses set forth on the signature pages hereto, in each case with a copy (which shall not constitute
actual or constructive notice) to:
Wilmer
Cutler Pickering Hale & Dorr LLP
7
World Trade Center
250
Greenwich Street
New
York, NY 10007
| |
Attention: |
Keith Trammell |
| |
|
Michael Gilligan |
| |
E-mail: |
Keith.Trammell@wilmerhale.com |
| |
|
Michael.Gilligan@wilmerhale.com |
and
Lane
Powell PC
1420
Fifth Avenue, Suite 4200
Seattle,
WA 98101
| |
Attention: |
Michael E. Morgan |
| |
E-mail: |
morganm@lanepowell.com |
(b)
If to the Guaranteed Party:
Nordstrom,
Inc.
1617
Sixth Avenue
Seattle,
Washington, 98101
| | E-mail: | Ann.Steines@nordstrom.com |
| Attention: | Ann
Munson Steines, Chief Legal Officer, General Counsel and Corporate Secretary |
with
a copy (which shall not constitute actual or constructive notice) to:
Sidley
Austin LLP
1001 Page Mill Road Building 1
Palo Alto, California 94304
Phone: (650) 565-7000
| |
Email: |
dzaba@sidley.com |
| |
Attention: |
Derek Zaba |
and
Sidley
Austin LLP
One South Dearborn
Chicago, Illinois 60603
Phone: (312) 853-7000
| |
Email: |
ggerstman@sidley.com |
| |
|
swilliams@sidley.com |
| |
Attention: |
Gary Gerstman |
| |
|
Scott R. Williams |
or
such other address or email address as such party may hereafter specify for the purpose by notice to the other parties hereto. All notices
and other communications hereunder must be in writing and will be deemed to have been duly delivered and received hereunder (i) one Business
Day after being sent for next Business Day delivery, fees prepaid, via a reputable nationwide overnight courier service or (ii) immediately
upon delivery by electronic mail or by hand (with a written or electronic confirmation of delivery). Any notice received at the addressee’s
location on any Business Day after 5:00 p.m., addressee’s local time, or on any day that is not a Business Day will be deemed to
have been received at 9:00 a.m., addressee’s local time, on the next Business Day. From time to time, any party may provide notice
to the other parties of a change in its address or e-mail address through a notice given in accordance with this Section 9, except that
that notice of any change to the address or any of the other details specified in or pursuant to this Section 7 will not be deemed
to have been received until, and will be deemed to have been received upon, the later of the date (A) specified in such notice; or (B)
that is five Business Days after such notice would otherwise be deemed to have been received pursuant to this Section 7.
8.
Continuing Guaranty.
(a)
This Limited Guaranty may not be revoked or terminated and shall remain in full force and effect and shall be binding on the Guarantors,
their successors and permitted assigns until the Aggregate Guarantor Proportion of the Obligations payable under this Limited Guaranty
have been paid and discharged in full (subject to the applicable Caps), at which time this Limited Guaranty shall terminate and the Guarantors
shall have no further obligations hereunder. Notwithstanding the foregoing or anything else to the contrary herein, this Limited Guaranty
shall terminate and the Guarantors shall have no further obligations under this Limited Guaranty as of the earliest to occur of (i) the
consummation of the Merger, (ii) the date that is ninety (90) days after any termination of the Merger Agreement by the Company if the
Guaranteed Party has not presented to Parent or the Guarantors a written notice with respect to a claim for payment of any Obligations
by such 90th day, (iii) the date that is ninety (90) days after any termination of the Merger Agreement by Parent if the Guaranteed Party
has not either (x) presented to Parent or the Guarantors a written notice with respect to a claim for payment of any Obligations by such
90th day or (y) commenced an Action challenging the validity of Parent’s termination or seeking specific performance or injunctive
relief under the Merger Agreement or the Equity Commitment Letter, (iv) if the Guaranteed Party has commenced such Action referred to
in clause (iii), the earlier to occur of (I) the consummation of the Merger and (II) the date that is forty-five (45) days after a final
and non-appealable judgment by a court of competent jurisdiction that the Merger Agreement was validly terminated by Parent if the Guaranteed
Party has not presented to Parent or the Guarantors a written notice with respect to a claim for payment of any Obligations by such 45th
day referred to in this clause (II), (v) if the Guaranteed Party has presented such written notice referred to in clause (ii) or clause
(iii) with respect to a claim for payment of any Obligations, the date that such claim is finally satisfied or otherwise finally judicially
resolved (including any Action seeking enforcement of the payment of such claim), (vi) the date the Guarantors have paid the Aggregate
Guarantor Proportion of the Obligations in full (subject to the applicable Caps) and (vii) the date the Liverpool Limited Guaranty terminates
(other than as a result of Liverpool having paid the full amount due thereunder).
(b)
Notwithstanding the foregoing, in the event that: (x) the Guaranteed Party or any of its controlled Affiliates or the Guaranteed Party’s
permitted assigns under this Limited Guaranty or any director of the Company in his or her capacity as such (other than any director
that is also a Parent Party) asserts in any legal proceeding that the provisions of Section 1 limiting the Guarantors’ liability
to the applicable Caps or Section 8 or 9 of this Limited Guaranty are illegal, invalid or unenforceable in whole or in part, or asserting
any theory of liability against the Guarantors or any Non-Recourse Party with respect to the transactions contemplated by the Merger
Agreement, the Equity Commitment Letter, this Limited Guaranty or any transactions contemplated hereby and thereby other than liabilities
in connection with the Retained Claims (against the Person specifically identified with respect to such Retained Claim) or (y) the Liverpool
Limited Guaranty terminates pursuant to Section 8(b)(x) thereof, then (i) the obligations of the Guarantors under this Limited Guaranty
shall terminate ab initio and shall thereupon be null and void, (ii) if any Guarantor has previously made any payments under this
Limited Guaranty, it shall be entitled to recover such payments from the Guaranteed Party, and (iii) neither the Guarantors nor any Non-Recourse
Party shall have any liability to the Guaranteed Party or any of its Subsidiaries with respect to the Merger Agreement, the Equity Commitment
Letter, this Limited Guaranty or the transactions contemplated by the Merger Agreement. Notwithstanding anything to the contrary contained
herein, nothing in this Limited Guaranty is intended to limit the obligations of Parent or Merger Sub under the Merger Agreement.
9.
No Recourse. Notwithstanding anything that may be expressed or implied in this Limited Guaranty or any document or instrument
delivered in connection herewith, by its acceptance of the benefits of this Limited Guaranty, the Guaranteed Party covenants, agrees
and acknowledges that no Person other than the Guarantors (and their permitted assigns) has any liabilities, obligations, or commitments
(whether known or unknown or whether contingent or otherwise) hereunder and that, notwithstanding that a Guarantor’s assignee permitted
under Section 6 hereof may be a partnership or limited liability company, the Guaranteed Party has no right of recovery under
this Limited Guaranty, or any claim based on such liabilities, obligations, and commitments against, and no personal liability whatsoever
shall attach to, be imposed upon or otherwise be incurred by, the former, current or future equity holders, controlling persons, directors,
officers, employees, agents, Affiliates (other than any assignee permitted under Section 6 hereof, under Section 4 of the Equity
Commitment Letter or under the Liverpool Limited Guaranty), members, managers or general or limited partners of any of the Guarantors
or Parent or of Merger Sub or any former, current or future stockholder, controlling person, director, officer, employee, general or
limited partner, member, manager, Affiliate (other than any assignee permitted under Section 6 hereof, under Section 4 of the
Equity Commitment Letter or under the Liverpool Limited Guaranty), financing sources or agent of any of the foregoing and their successors
or assigns (collectively, but not including the Guarantors, Parent and Merger Sub, or their respective successors and permitted assigns,
each a “Non-Recourse Party”), through Parent hereunder, whether by or through attempted piercing of the corporate
veil, by or through a claim by or on behalf of Parent against any Non-Recourse Party, by the enforcement of any assessment or by any
legal or equitable proceeding, by virtue of any statute, regulation or applicable Law, or otherwise, except pursuant to the Retained
Claims (against the Person specifically identified with respect to such Retained Claim and in the circumstances provided therein). The
Guaranteed Party further covenants, agrees and acknowledges that the only rights of recovery that the Guaranteed Party has in respect
of the Merger Agreement, the Equity Commitment Letter, the other Transaction Documents, or the transactions contemplated thereby or in
connection therewith, against the Non-Recourse Parties are the Retained Claims. The Guaranteed Party acknowledges and agrees that Parent
has no assets other than certain contract rights and that no additional funds are expected to be contributed to Parent unless the Closing
occurs and only substantially concurrently therewith in accordance with the terms of the Equity Commitment Letter. Recourse against the
Guarantors under and pursuant to the terms of this Limited Guaranty shall be the sole and exclusive remedy of the Guaranteed Party and
all of its controlled Affiliates against the Guarantors and the Non-Recourse Parties in respect of any liabilities or obligations arising
under, or in connection with, the Merger Agreement, the Equity Commitment Letter or the transactions contemplated thereby, including
by piercing of the corporate veil or by a claim by or on behalf of Parent, other than the Retained Claims (against the Person specifically
identified with respect to such Retained Claim and in the circumstances provided therein). Notwithstanding the foregoing, nothing in
this Limited Guaranty shall restrict the ability of the Guaranteed Party to bring the Retained Claims against the Person specifically
identified therein to the extent permitted thereby, nor shall it limit the liability or the obligations of such Person under such Retained
Claim, which liability shall be subject to the limitations applicable to the corresponding Retained Claim.
10.
Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.
(a)
Except to the extent the Laws of the State of Washington are mandatorily applicable, this Limited Guaranty and all Actions (whether based
on Contract, tort or otherwise) arising out of or relating to this Limited Guaranty or the actions of the Guarantors or the Guaranteed
Party in the negotiation, administration, performance and enforcement thereof, shall be governed by, and construed in accordance with
the laws of the State of Delaware, without giving effect to any choice or conflict of laws provision or rule (whether of the State of
Delaware or any other jurisdiction) that would cause the application of the Laws of any jurisdiction other than the State of Delaware.
(b)
Each of the parties hereto hereby (i) expressly and irrevocably submits to the exclusive personal jurisdiction of the state courts of
the Delaware Court of Chancery, any other court of the State of Delaware or any federal court sitting in the State of Delaware, in the
event any dispute arises out of or relates to this Limited Guaranty or the transactions contemplated hereby, (ii) agrees that it
will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (iii) agrees
that it will not bring any Action relating to this Limited Guaranty or the transactions contemplated hereby in any court other than the
Delaware Court of Chancery, any other court of the State of Delaware or any federal court sitting in the State of Delaware, (iv) waives,
to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of
any Action arising out of or relating to this Limited Guaranty and (e) agrees that the other party hereto shall have the right to bring
any Action for enforcement of a judgment entered by the state courts of the Delaware Court of Chancery, any other court of the State
of Delaware or any federal court sitting in the State of Delaware. Each of the Guarantors and the Guaranteed Party agrees that a final
judgment in any Action shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner
provided by Law, and each Guarantor consents to such enforcement and covenants not to oppose such enforcement in any jurisdiction.
(c)
EACH PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION (WHETHER BASED
ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS GUARANTY
OR THE ACTIONS OF THE GUARANTORS OR THE GUARANTEED PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF. EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES
HERETO HAVE BEEN INDUCED TO ENTER INTO THIS GUARANTY BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS section
10(c).
11.
Counterparts. This Limited Guaranty and any amendments or waivers hereto may be executed in one or more counterparts, all
of which will be considered one and the same agreement and will become effective when one or more counterparts have been signed by each
party hereto and delivered to the other parties hereto, it being understood that all parties need not sign the same counterpart. Any
such counterpart, to the extent delivered by fax or .pdf, .tif, .gif, .jpg or similar attachment to electronic mail (any such delivery,
an “Electronic Delivery”), will be treated in all manner and respects as an original executed counterpart and
will be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. No party
hereto may raise the use of an Electronic Delivery to deliver a signature, or the fact that any signature or agreement or instrument
was transmitted or communicated through the use of an Electronic Delivery, as a defense to the formation of a contract, and each party
hereto forever waives any such defense, except to the extent such defense relates to lack of authenticity.
12.
No Third Party Beneficiaries. Except as provided in Section 9 hereof for the benefit of the Non-Recourse Parties, the
parties hereby agree that their respective representations, warranties and covenants set forth herein are solely for the benefit of the
parties hereto and their respective successors and permitted assigns, and nothing set forth in this Limited Guaranty shall be construed
to confer upon or give to any Person, other than the parties hereto and their respective successors and permitted assigns, any benefits,
rights or remedies under or by reason of, or any rights to enforce the obligations set forth herein.
13.
Confidentiality. This Limited Guaranty shall be treated as confidential and is being provided to the Guaranteed Party solely
in connection with the Merger Agreement. This Limited Guaranty may not be used, circulated, quoted or otherwise referred to in any document,
except with the written consent of each of the Guarantors; provided that no such written consent shall be required for any disclosure
of the existence or terms of this Limited Guaranty to the parties to the Merger Agreement or their Representatives with a need to know
in connection with the transactions contemplated by the Merger Agreement, to the extent required by applicable Law or the applicable
rules of any national securities exchange, in connection with the Guaranteed Party’s and Parent’s filings with the SEC relating
to the transactions contemplated by the Merger Agreement, or if required in connection with any required filing or notice with any Governmental
Authority relating to the transactions contemplated by the Merger Agreement. The Guaranteed Party will permit the Guarantors the opportunity
to comment on any such required disclosure to the extent practicable, which the Guaranteed Party will consider in good faith (it being
agreed that by providing Parent an opportunity to comment on such required disclosure, the Guaranteed Party will be deemed to have provided
the Guarantors the opportunity to comment on such required disclosure). Following the filing of this Limited Guaranty with the SEC, the
parties shall have no obligations pursuant to the first two sentences of this Section 13.
14.
Miscellaneous.
(a)
Together with the Merger Agreement and the other Transaction Documents to which any of the Guarantors is a party, and the other agreements
and instruments contemplated hereby or thereby, this Limited Guaranty letter constitutes the entire agreement of the parties hereto and
supersedes all prior agreements and understandings, both written and oral, among or between any of the parties with respect to the subject
matter hereof and thereof.
(b)
No amendment, modification or waiver of any provision hereof shall be enforceable unless approved in writing by (i) in the case of an
amendment or modification, the Guaranteed Party and the Guarantors and (ii) in the case of a waiver, the party against whom the waiver
is to be effective. No delay or omission on the part of the Guaranteed Party in exercising any right, power or remedy under this Limited
Guaranty will operate as a waiver thereof.
(c)
If any term, provision, covenant or restriction of this Limited Guaranty is held by a court of competent jurisdiction or other Governmental
Authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Limited Guaranty
shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance
of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such a determination, the
parties shall negotiate in good faith to modify this Limited Guaranty so as to effect the original intent of the parties as closely as
possible in an acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the
fullest extent possible. Notwithstanding the foregoing, the parties intend that the remedies and limitations thereon contained in this
Limited Guaranty, including the Caps and the provisions of Section 8, Section 9 and this Section 14(c), hereof,
be construed as an integral provision of this Limited Guaranty and that such remedies and limitations shall not be severable in any manner
that increases liability or obligations hereunder of any party hereto or of any Guarantor or of any Non-Recourse Party.
(d)
Section 9.3(c) of the Merger Agreement is incorporated by reference herein, mutatis mutandis.
(e)
All parties acknowledge that each party and its counsel have reviewed this Limited Guaranty and that any rule of construction to the
effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Limited
Guaranty.
15.
No Partnership. The Guaranteed Party acknowledges and agrees that (a) this Limited Guaranty and the Liverpool Limited Guaranty
is not intended to, and do not, create any agency, partnership, fiduciary or joint venture relationship between or among the Guarantors
or between or among the Guarantors and Liverpool and neither this Limited Guaranty, the Liverpool Limited Guaranty, nor any other document
or agreement entered into by any party hereto or thereto, as applicable, relating to the subject matter hereof shall be construed to
suggest otherwise and (b) the determination of each Guarantor to enter into this Limited Guaranty and the determination of Liverpool
to enter into the Liverpool Limited Guaranty were independent of each other. Notwithstanding anything to the contrary contained in this
Limited Guaranty or the Liverpool Limited Guaranty, the liability of the Guarantors, on the one hand, and Liverpool, on the other hand,
shall be several, not joint or joint and several. Notwithstanding anything to the contrary contained in this Limited Guaranty, the liability
of each Guarantor hereunder shall be several, not joint or joint and several, based upon its Pro Rata Percentage, and no Guarantor shall
be liable for any amount hereunder in excess of its Pro Rata Percentage of the Aggregate Guarantor Proportion of the applicable Obligation
(subject to the applicable Pro Rata Cap). The “Pro Rata Percentage” of each Guarantor is as set forth below:
| Guarantor | |
Pro Rata Percentage | |
| Erik B. Nordstrom | |
| 12.71 | % |
| Peter E. Nordstrom | |
| 12.50 | % |
| James F. Nordstrom, Jr. | |
| 1.90 | % |
| Anne E. Gittinger | |
| 32.41 | % |
| Anne E. Gittinger Trust u/w Everett W. Nordstrom | |
| 12.87 | % |
| 1976 Elizabeth J. Nordstrom Trust FBO Anne Gittinger | |
| 3.64 | % |
| Estate of Bruce A. Nordstrom | |
| 23.97 | % |
* * * * *
| |
/s/ Erik B. Nordstrom |
| |
Erik B. Nordstrom |
[Signature Page to Limited Guaranty]
| |
/s/ Peter E. Nordstrom |
| |
Peter E. Nordstrom |
[Signature Page to Limited Guaranty]
| |
/s/ James F. Nordstrom, Jr |
| |
James F. Nordstrom, Jr. |
[Signature Page to Limited Guaranty]
| |
/s/ Anne E. Gittinger |
| |
Anne E. Gittinger |
[Signature Page to Limited Guaranty]
| |
1976 ELIZABETH J. NORDSTROM TRUST |
| |
FBO ANNE GITTINGER |
| |
|
|
| |
By: |
/s/ Anne E. Gittinger |
| |
|
Name: |
Anne E. Gittinger |
| |
|
Title: |
Trustee |
[Signature Page to Limited Guaranty]
| |
ANNE E. GITTINGER TRUST |
| |
U/W EVERETT W. NORDSTROM |
| |
|
| |
By: |
/s/ Anne E. Gittinger |
| |
|
Name: |
Anne E. Gittinger |
| |
|
Title: |
Trustee |
[Signature Page to Limited Guaranty]
| |
ESTATE OF BRUCE A. NORDSTROM |
| |
|
| |
By: |
/s/ Margaret Jean O’Roark Nordstrom |
| |
|
Name: |
Margaret Jean O’Roark Nordstrom |
| |
|
Title: |
Co-Executor |
| |
|
| |
By: |
/s/ Peter E. Nordstrom |
| |
|
Name: |
Peter E. Nordstrom |
| |
|
Title: |
Co-Executor |
| |
|
| |
By: |
/s/ Erik B. Nordstrom |
| |
|
Name: |
Erik B. Nordstrom |
| |
|
Title: |
Co-Executor |
[Signature Page to Limited Guaranty]
| Agreed to and accepted: |
|
| |
|
|
| NORDSTROM, INC. |
|
| |
|
|
| By: |
/s/ Cathy R. Smith |
|
| |
Name: |
Cathy R. Smith |
|
| |
Title: |
Chief Financial Officer |
|
[Signature Page to Limited Guaranty]
Exhibit A
Family Guarantor Group
| 2. | Anne E. Gittinger Trust u/w Everett W. Nordstrom |
| 3. | 1976 Elizabeth J. Nordstrom Trust FBO Anne Gittinger |
| 4. | Estate of Bruce A. Nordstrom |
| 7. | James F. Nordstrom, Jr. |
Exhibit 16(b)(iv)
EXECUTION VERSION
LIMITED GUARANTY
This LIMITED GUARANTY is dated as
of December 22, 2024 (this “Limited Guaranty”), and is by El Puerto de Liverpool, S.A.B. de C.V. (the “Guarantor”),
in favor of Nordstrom, Inc. (the “Company” or the “Guaranteed Party”).
1. Limited
Guaranty.
(a) To
induce the Guaranteed Party to enter into the Agreement and Plan of Merger (as amended, restated, supplemented or otherwise modified from
time to time, the “Merger Agreement”) entered into concurrently herewith by and among Norse Holdings, Inc.,
a Delaware corporation (“Parent”), Navy Acquisition Co. Inc., a Washington corporation and an indirect wholly
owned subsidiary of Parent (“Merger Sub”), and the Company, the Guarantor, intending to be legally bound, hereby
absolutely, irrevocably and unconditionally guarantees to the Guaranteed Party, on the terms and subject to the conditions set forth herein,
the due and punctual payment and performance when due of an amount equal to 50% of the Obligations set forth under clauses (i), (ii),
(iii), (iv) and (v) of the definition thereof and 100% of the Obligations set forth under clause (vi) of the definition thereof (such
percentages, as applicable, the “Guarantor Proportion”); provided that, if the Guaranteed Party is enforcing
its rights under both this Limited Guaranty and the Family Limited Guaranty (as defined below) in the same Action, the Guarantor Proportion
with respect to the Obligations set forth under clause (vi) of the definition thereof shall be 50%. For purposes of this Limited Guaranty,
the “Obligations” shall mean, collectively:
(i) the
Base Reverse Termination Fee payable by Parent to the Guaranteed Party pursuant to Section 8.3(b) of the Merger Agreement;
(ii) the
Downgrade Reverse Termination Fee payable by Parent to the Guaranteed Party pursuant to Section 8.3(b) of the Merger Agreement;
(iii) all
amounts payable by Parent under and in accordance with the terms of the Merger Agreement or a Rollover and Support Agreement (as applicable)
in the event of an Intentional Breach (except for any amounts payable in respect of the obligations referred to in clause (iv), (v) and
(vi));
(iv) all
amounts payable in respect of Parent’s obligations to pay costs, expenses and interest pursuant to Section 8.3(h) of the Merger
Agreement;
(v) all
amounts payable in respect of Parent’s expense reimbursement and indemnification obligations pursuant to Section 6.12(e) and (f)
of the Merger Agreement; and
(vi) the
costs and expenses incurred by the Guaranteed Party in connection with enforcing its rights under this Limited Guaranty;
provided that in no event shall the Guarantor’s
liability under this Limited Guaranty with respect to the Obligations exceed:
(A) with
respect to the Obligations set forth under clause (i) of the definition thereof, $85,000,000;
(B) with
respect to the Obligations set forth under clause (ii) of the definition thereof, $50,000,000;
(C) with
respect to the Obligations set forth under clauses (i), (ii) and (iii) of the definition thereof, $150,000,000 in the aggregate; and
(D) with
respect to the Obligations set forth under clauses (iv), (v) and (vi) of the definition thereof, $20,000,000 in the aggregate (each such
cap, as applicable, the “Cap”).
(b) The
parties acknowledge and agree that (x) a particular clause of the definition of Obligations may be, and in certain cases is, subject to
multiple Caps and (y) once the Guarantor’s aggregate liability with respect to any particular clause of the definition of Obligations
exceeds any Cap applicable to such clause, the Guarantor shall have no further liability with respect to such clause notwithstanding the
fact other Caps to which such clause is also subject may not have been exceeded but may have further liability with respect to Obligations
set forth under other clauses of the definition up to the Cap applicable to such clause. The parties agree that this Limited Guaranty
may not be enforced against the Guarantor without giving effect to the applicable Caps. The Guaranteed Party hereby agrees that in no
event shall the Guarantor be required to pay to the Guaranteed Party or any of its controlled Affiliates or any director of the Company,
in each case in his or her capacity as such (other than any director that is also a Parent Party), under, in respect of, or in connection
with, this Limited Guaranty, the Merger Agreement or any other Transaction Document any amounts other than as expressly set forth herein
(including, for the avoidance of doubt, pursuant to the Retained Claims). All payments hereunder shall be made in lawful money of the
United States, in immediately available funds. Each capitalized term used and not defined herein shall have the meaning ascribed to it
in the Merger Agreement, except as otherwise provided herein.
(c) In
connection with the execution of the Merger Agreement, the Guaranteed Party has received a Limited Guaranty (the “Family Limited
Guaranty”), dated the date hereof, from other investors (collectively, the “Family Guarantors”).
Notwithstanding anything set forth herein to the contrary: (i) the obligations of the Guarantor under this Limited Guaranty, on the one
hand, and of the Family Guarantors under the Family Limited Guaranty, on the other hand, shall be several and not joint or joint and several,
(ii) the Guaranteed Party shall be entitled to enforce the Guarantor Proportion of the Obligations against the Guarantor (and its permitted
assigns) if and only to the extent that the Guaranteed Party has, substantially concurrently with the enforcement of this Limited Guaranty,
sought to enforce all or the same portion of the liabilities due under the Family Limited Guaranty (except for such amounts that have
been paid), it being acknowledged that the actual payment of some or all of such portion by the Family Guarantors shall not be a condition
to the payment of the Guarantor Proportion of the Obligations (so long as enforcement is being sought therefor), and (iii) the Guaranteed
Party shall not enter into any agreement with the Family Guarantors (or their permitted assigns) modifying the amount, timing or other
terms of the payment of the portion of the obligations payable under the Family Limited Guaranty (a “Modified Payment Agreement”)
unless the Guaranteed Party offers to enter into an agreement with the Guarantor (or its permitted assigns) providing for substantively
the same modifications contemplated by the applicable Modified Payment Agreement and a return of any payments made by the Guarantor (or
its permitted assigns) under this Limited Guaranty prior to such agreement to the extent such payments would not have been payable under
such agreement.
2. Nature
of Guaranty. The Guaranteed Party shall not be obligated to file any claim relating to the Obligations in the event that Parent
or Merger Sub becomes subject to a bankruptcy, reorganization or similar proceeding, and the failure of the Guaranteed Party to so file
shall not affect the Guarantor’s obligations hereunder. In the event that any payment to the Guaranteed Party in respect of the
Obligations is rescinded or must otherwise be returned, for any reason whatsoever (other than as set forth in the first sentence of Section
8(b) hereof), the Guarantor shall remain liable hereunder with respect to the Guarantor Proportion of the Obligations (subject to the
applicable Caps) as if such payment had not been rescinded or returned. This Limited Guaranty is an unconditional guaranty of payment
and not of collection. Subject to Section 1(c)(ii), the Guaranteed Party may, in its sole discretion, bring and prosecute a separate Action
or Actions against the Guarantor for the full amount of the Guarantor Proportion of the Obligations (subject to the applicable Caps),
regardless of whether an Action for payment is also brought against Parent or Merger Sub or any other Person or whether Parent or Merger
Sub or any other Person is joined in any such Action or Actions.
3. Changes
in Obligations; Certain Waivers.
(a) The
Guarantor agrees that the Guaranteed Party may at any time and from time to time, without notice to or further consent of the Guarantor,
extend the time of payment of any of the Obligations (or any portion thereof), and may also make any agreement with Parent, Merger Sub
or any other Person (other than the Family Guarantors, except in compliance with Section 1(c)(iii)) interested in the transactions contemplated
by the Merger Agreement, for the extension, renewal, payment, compromise, discharge or release of the Obligations or liability for the
Obligations, in whole or in part, or with Parent and Merger Sub for any modification of the terms of the Merger Agreement, without in
any way releasing, discharging, impairing or affecting the Guarantor’s obligations under this Limited Guaranty or affecting the
validity or enforceability of the Limited Guaranty. Subject to clauses (ii) and (iii) of Section 1(c), the Guarantor agrees that its obligations
hereunder shall not be released or discharged, in whole or in part, or otherwise impaired or affected by:
(i) the
failure or delay on the part of the Guaranteed Party to assert any claim or demand or to enforce any right or remedy against Parent or
Merger Sub or any other Person interested in the transactions contemplated by the Merger Agreement;
(ii) any
change in the time, place, manner or terms of payment of any of the Obligations or any rescission, waiver, compromise, consolidation or
other amendment to or modification of any of the terms or provisions of the Merger Agreement made in accordance with the terms thereof
or any other agreement evidencing, securing or otherwise executed in connection with any of the Obligations;
(iii) the
existence of any claim, set-off, deduction, defense or release that the Guarantor could assert against Parent or Merger Sub, the Family
Guarantors, or any other Person interested in the transactions contemplated by the Merger Agreement, whether in connection with the Merger
Agreement and the Obligations or otherwise;
(iv) the
addition, substitution, discharge or release of any other Person now or hereafter liable with respect to any of the Obligations or otherwise
interested in the transactions contemplated by the Merger Agreement;
(v) any
change in the structure or ownership of Parent or Merger Sub, the Family Guarantors or any other Person now or hereafter liable with respect
to any of the Obligations or otherwise interested in the transactions contemplated by the Merger Agreement;
(vi) any
insolvency, bankruptcy, reorganization or other similar proceeding affecting Parent, Merger Sub, the Family Guarantors, or any other Person
now or hereafter liable with respect to any of the Obligations or otherwise interested in the transactions contemplated by the Merger
Agreement;
(vii) the
right by statute or otherwise to require the Guaranteed Party to institute suit against Parent or Merger Sub or any other Person or to
exhaust any rights or remedies which the Guaranteed Party has or may have against Parent or Merger Sub or any other Person;
(viii) the
adequacy of any other means the Guaranteed Party may have of obtaining payment or other remedy related to any of the Obligations; or
(ix) any
action or inaction on the part of the Guaranteed Party that is not in violation of the terms of the Merger Agreement or this Limited Guaranty,
including, without limitation, the absence of any attempt to assert any claim or demand against Parent or collect the Obligations from
any or all of Parent, the Guarantor, and the Family Guarantors.
(b) To
the fullest extent permitted by applicable Law, the Guarantor hereby expressly waives any and all rights or defenses arising by reason
of any Law which would otherwise require any election of remedies by the Guaranteed Party. The Guarantor waives promptness, diligence,
notice of the acceptance of this Limited Guaranty and of the Obligations, presentment, demand for payment, notice of non-performance,
default, dishonor and protest, notice of any Obligations incurred and all other notices of any kind (other than notices expressly required
to be provided to Parent or Merger Sub pursuant to the Merger Agreement), all defenses that may be available by virtue of any valuation,
stay, moratorium, or other applicable Law now or hereafter in effect, any right to require the marshalling of assets of Parent or any
other Person now or hereafter liable with respect to any of the Obligations or otherwise interested in the transactions contemplated by
the Merger Agreement, and all suretyship defenses generally (other than defenses to the payment of the Obligations that are available
to Parent or Merger Sub under the Merger Agreement or a breach by the Guaranteed Party of Section 1(c) or Section 3(c) of this Limited
Guaranty). The Guarantor acknowledges that it will receive substantial direct and indirect benefits from the transactions contemplated
by the Merger Agreement and that this Limited Guaranty, including specifically the waivers set forth in this Limited Guaranty, are knowingly
made in contemplation of such benefits. The Obligations shall conclusively be deemed to have been created, contracted or incurred in reliance
upon this Limited Guaranty, and all dealings between Parent or the Guarantor, on the one hand, and the Guaranteed Party, on the other
hand, shall likewise be conclusively presumed to have been had or consummated in reliance upon this Limited Guaranty.
(c) The
Guaranteed Party hereby covenants and agrees that it shall not institute, directly or indirectly, and shall cause its controlled Affiliates
and each Company director in his or her capacity as such (other than any director that is also a Parent Party), not to institute, any
Action arising under, or in connection with, the Merger Agreement, the transactions contemplated thereby, or the Equity Commitment Letter
(as defined below), in each case against the Guarantor or any Non-Recourse Party (as defined in Section 9 herein), except
for any Action (i) against the Guarantor (or its permitted assigns) under this Limited Guaranty (subject to the limitations described
herein), (ii) against the Guarantor (or its permitted assigns) under Sections 4(a), 4(b) or 6 of the equity commitment letter between
the Guarantor and Parent dated the date hereof (the “Equity Commitment Letter”), (iii) against any party (or
its permitted assigns) to a Rollover and Support Agreement under such Rollover and Support Agreement, (iv) against the Family Guarantors
(or their permitted assigns) under the Family Limited Guaranty, (v) against any party (or its permitted assigns) to a Confidentiality
Agreement under such Confidentiality Agreement, or (vi) against any party (or its permitted assigns) to that certain amended and restated
letter agreement, dated as of December 22, 2024, by and among the Company and the Buyer Group party thereto (the “Buyer Group
Disbandment Letter”), or that certain letter agreement, dated as of December 22, 2024, by and among the Company and the
Family Guarantors party thereto (together, the “Disbandment Letters”) under such Disbandment Letters (the claims
in clauses (i) through (vi), the “Retained Claims”). The Guarantor hereby covenants and agrees that it shall
not institute, directly or indirectly, and shall cause its controlled Affiliates not to institute, any Action asserting that this Limited
Guaranty, the Family Limited Guaranty, any Rollover and Support Agreement, the Equity Commitment Letter, the Disbandment Letters or the
Merger Agreement is illegal, invalid or unenforceable in accordance with their respective terms. For the avoidance of doubt, in no event
shall the Guarantor have any obligation to make any payment hereunder at any time after the Guarantor or its assignees under the Equity
Commitment Letter shall have made full payment or contribution of any amounts required to be paid or contributed under the Equity Commitment
Letter and the Closing has occurred.
(d) The
Guarantor hereby unconditionally waives any rights that it may now have or hereafter acquire against the Parent or Merger Sub that arise
from the existence, payment, performance, or enforcement of the Guarantor’s obligations under or in respect of this Limited Guaranty
or any other agreement in connection herewith, including any right of subrogation, reimbursement, exoneration, contribution or indemnification
and any right to participate in any claim or remedy of the Guaranteed Party against Parent, whether or not such claim, remedy or right
arises in equity or under contract, statute or applicable Law, including the right to take or receive from Parent or such other Person,
directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim,
remedy or right, unless and until all of the Obligations and all other amounts payable under this Limited Guaranty (subject to the applicable
Caps) and all Obligations (as defined under the Family Limited Guaranty) and all other amounts payable under the Family Limited Guaranty
shall have been previously paid in immediately available funds. If any amount shall be paid to the Guarantor in violation of the immediately
preceding sentence at any time prior to the payment in full in immediately available funds of the Obligations and all other amounts payable
under this Limited Guaranty (subject to the applicable Caps), such amount shall be received and held in trust for the benefit of the Guaranteed
Party, shall be segregated from other property and funds of the Guarantor and shall forthwith be paid or delivered to the Guaranteed Party
in the same form as so received (with any necessary endorsement or assignment) to be credited and applied to the Obligations and other
amounts payable under this Limited Guaranty and the Family Limited Guaranty, whether matured or unmatured, or to be held as collateral
for any Obligations or other amounts payable under this Limited Guaranty thereafter arising (subject to the applicable Caps).
(e) Notwithstanding
anything to the contrary contained in this Limited Guaranty, the Guaranteed Party hereby agrees that: (i) to the extent Parent is relieved
of any portion of the Obligations, the Guarantor and the Family Guarantors shall each be similarly relieved of a proportional amount of
their obligations under this Limited Guaranty and the Family Limited Guaranty (as applicable) and (ii) the Guarantor may assert, as a
defense to, or release or discharge of, any payment or performance by the Guarantor under this Limited Guaranty, any claim, set off, deduction,
defense that Parent could assert against the Company under the terms of the Merger Agreement or for a breach by the Guaranteed Party of
Section 1(c) or Section 3(c) of this Limited Guaranty.
4. No
Waiver; Cumulative Rights. No failure on the part of the Guaranteed Party to exercise, and no delay in exercising, any right,
remedy or power hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the Guaranteed Party of any right,
remedy or power hereunder preclude any other or future exercise of any right, remedy or power hereunder. Each and every right, remedy
and power hereby granted to the Guaranteed Party shall be cumulative and not exclusive of any other right, remedy or power, and may be
exercised by the Guaranteed Party at any time or from time to time. For the avoidance of doubt, this Limited Guaranty shall not restrict,
nor shall it be terminated upon or otherwise be impaired by, the Guaranteed Party’s rights to bring any Action against Parent and
Merger Sub under the Merger Agreement. The Guaranteed Party shall not have any obligation to proceed at any time or in any manner against,
or exhaust any or all of the Guaranteed Party’s rights against, Parent or Merger Sub, the Family Guarantors (subject to Section
1(c)(ii)), or any other Person prior to proceeding against any Guarantor hereunder. For the avoidance of doubt, and notwithstanding anything
to the contrary contained herein, the Guaranteed Party expressly hereby acknowledges that: (a) the only manner in which the Guaranteed
Party or any of its Affiliates can obtain any form of money damages or other remedy against the Guarantor or any Non-Recourse Party with
respect to the Merger Agreement, the Rollover and Support Agreement to which the Guarantor is a party, the Equity Commitment Letter, this
Limited Guaranty or any transactions contemplated hereby and thereby is (i) monetary damages or other remedies pursuant to the provisions
of, as applicable, this Limited Guaranty, the Family Limited Guaranty, the Confidentiality Agreements, and the Disbandment Letters and
(ii) specific performance, an injunction or other equitable remedies that the Guaranteed Party is entitled to in accordance with the express
terms and conditions of, as applicable, the Equity Commitment Letter, the Rollover and Support Agreements, the Confidentiality Agreements,
and the Disbandment Letters, and (b) under no circumstances will it be permitted or entitled to receive both (x) a grant of specific performance
under the express terms and conditions of the Merger Agreement, the Equity Commitment Letter and the Rollover and Support Agreements that
results in the occurrence of the Closing and (y) money damages under the Merger Agreement and this Limited Guaranty.
5. Representations
and Warranties. The Guarantor hereby represents and warrants that:
(a) it
is duly organized and validly existing under the Laws of the jurisdiction of its organization and has all necessary power and authority
to execute, deliver and perform its obligations under this Limited Guaranty;
(b) the
execution, delivery and performance of this Limited Guaranty have been duly and validly authorized by all necessary action, and do not
(i) contravene any provision of the Guarantor’s charter, bylaws (estatutos sociales), partnership agreement, operating agreement
or similar organizational documents, (ii) conflict with or violate any applicable Law, regulation, rule, decree, order, or judgment or
(iii) result in any breach of, or constitute a default (with or without notice or lapse of time, or both) under, or give rise to any right
of termination, acceleration or cancellation of any contractual restriction applicable to the Guarantor, its Subsidiaries or their respective
assets or properties;
(c) all
consents, approvals, authorizations, permits of, filings with and notifications to, any Governmental Authority necessary for the due execution,
delivery and performance of this Limited Guaranty by the Guarantor have been obtained or made and all conditions thereof have been duly
complied with, and no other action by, and no notice to or filing with, any Governmental Authority is required in connection with the
execution, delivery or performance of this Limited Guaranty;
(d) this
Limited Guaranty has been duly and validly executed and delivered by it and, assuming due and valid authorization, execution and delivery
of this Limited Guaranty by the other parties hereto, this Limited Guaranty constitutes a legal, valid and binding obligation of it, enforceable
against it in accordance with its terms, except as may be limited by: (i) the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other similar Laws affecting creditors’ rights generally, and (ii) general equitable principles (whether
considered in a proceeding in equity or at law); and
(e) the
Guarantor has the financial capacity to pay and perform its obligations under this Limited Guaranty, and all funds necessary for the Guarantor
to fulfill its obligations under this Limited Guaranty are and shall be available to the Guarantor for so long as this Limited Guaranty
shall remain in effect in accordance with Section 8 hereof.
6. No
Assignment. This Limited Guaranty may not be assigned by either party (except by operation of applicable Laws) without the prior
written consent of the other party; provided, however, that, without the prior written consent of the Guaranteed Party,
the Guarantor may assign its obligation with respect to the Obligations under this Limited Guaranty to one or more of its Affiliates,
so long as such assignment would not reasonably be expected to (i) prevent, impair or delay the consummation of the transactions contemplated
by the Merger Agreement or the payment and performance in full of the Obligations or (ii) require any additional consents, approvals or
regulatory filings, the failure of which would prevent, impair or delay the consummation of the transactions contemplated by the Merger
Agreement or the payment and performance in full of the Obligations; provided, further however, that any such permitted
assignment shall only relieve the Guarantor of any of its obligations under this Limited Guaranty (including the Obligations) to the extent
that such assignee has actually performed such obligations (including full payment and performance of the Obligations). Following any
valid assignment by the Guarantor of its obligations hereunder pursuant to the immediately preceding sentence, the Guarantor will provide
the Guaranteed Party with written notice of such assignment. Upon any permitted assignment pursuant to this Section 6, such assignee shall
be deemed to have given the representations and warranties set forth in Section 5 of this Limited Guaranty as of the time of such assignment.
Any attempted assignment in violation of this section shall be null and void.
7. Notices.
All notices, requests, claims, demands and other communications hereunder shall be given by the means specified in the Merger Agreement
(and shall be deemed given as specified therein), as follows:
c/o El Puerto de Liverpool, S.A.B. de C.V.
Mario Pani No. 200,
Col. Santa Fe Cuajimalpa
Cuajimalpa, CDMX CP 05348
| Attention: | Gonzalo Gallegos |
Jacobo Apichoto
| Email: | ggallegosm@liverpool.com.mx |
japichoto@liverpool.com.mx
with a copy (which shall not constitute actual or constructive
notice) to:
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, NY 10017
| Attention: | Benjamin P. Schaye |
Juan F. Méndez
| E-mail: | ben.schaye@stblaw.com |
jmendez@stblaw.com
| (b) | If to the Guaranteed Party: |
Nordstrom, Inc.
1617 Sixth Avenue
Seattle, Washington, 98101
| E-mail: | Ann.Steines@nordstrom.com |
| Attention: | Ann Munson Steines, Chief Legal Officer, General Counsel
and Corporate Secretary |
with a copy (which shall not constitute actual or constructive
notice) to:
Sidley Austin LLP
1001 Page Mill Road Building 1
Palo Alto, California 94304
Phone: (650) 565-7000
and
Sidley Austin LLP
One South Dearborn
Chicago, Illinois 60603
Phone: (312) 853-7000
| Email: | ggerstman@sidley.com |
swilliams@sidley.com
Scott R. Williams
or such other address or email address as such party may hereafter
specify for the purpose by notice to the other parties hereto. All notices and other communications hereunder must be in writing and will
be deemed to have been duly delivered and received hereunder (i) one Business Day after being sent for next Business Day delivery, fees
prepaid, via a reputable nationwide overnight courier service or (ii) immediately upon delivery by electronic mail or by hand (with a
written or electronic confirmation of delivery). Any notice received at the addressee’s location on any Business Day after 5:00
p.m., addressee’s local time, or on any day that is not a Business Day will be deemed to have been received at 9:00 a.m., addressee’s
local time, on the next Business Day. From time to time, any party may provide notice to the other parties of a change in its address
or e-mail address through a notice given in accordance with this Section 9, except that that notice of any change to the address or any
of the other details specified in or pursuant to this Section 7 will not be deemed to have been received until, and will be deemed
to have been received upon, the later of the date (A) specified in such notice; or (B) that is five Business Days after such notice would
otherwise be deemed to have been received pursuant to this Section 7.
8. Continuing
Guaranty.
(a) This
Limited Guaranty may not be revoked or terminated and shall remain in full force and effect and shall be binding on the Guarantor, its
successors and permitted assigns until the Obligations payable under this Limited Guaranty have been paid and discharged in full (subject
to the applicable Caps), at which time this Limited Guaranty shall terminate and the Guarantor shall have no further obligations hereunder.
Notwithstanding the foregoing or anything else to the contrary herein, this Limited Guaranty shall terminate and the Guarantor shall have
no further obligations under this Limited Guaranty as of the earliest to occur of (i) the consummation of the Merger, (ii) the date that
is ninety (90) days after any termination of the Merger Agreement by the Company if the Guaranteed Party has not presented to Parent or
the Guarantor a written notice with respect to a claim for payment of any Obligations by such 90th day, (iii) the date that is ninety
(90) days after any termination of the Merger Agreement by Parent if the Guaranteed Party has not either (x) presented to Parent or the
Guarantor a written notice with respect to a claim for payment of any Obligations by such 90th day or (y) commenced an Action challenging
the validity of Parent’s termination or seeking specific performance or injunctive relief under the Merger Agreement or the Equity
Commitment Letter, (iv) if the Guaranteed Party has commenced such Action referred to in clause (iii), the earlier to occur of (I) the
consummation of the Merger and (II) the date that is forty-five (45) days after a final and non-appealable judgment by a court of competent
jurisdiction that the Merger Agreement was validly terminated by Parent if the Guaranteed Party has not presented to Parent or the Guarantor
a written notice with respect to a claim for payment of any Obligations by such 45th day referred to in this clause (II), (v) if the Guaranteed
Party has presented such written notice referred to in clause (ii) or clause (iii) with respect to a claim for payment of any Obligations,
the date that such claim is finally satisfied or otherwise finally judicially resolved (including any Action seeking enforcement of the
payment of such claim), (vi) the date the Guarantor has paid the Guarantor Proportion of the Obligations in full (subject to the applicable
Caps) and (vii) the date the Family Limited Guaranty terminates (other than as a result of the Family Guarantors having paid the full
amount due thereunder).
(b) Notwithstanding
the foregoing, in the event that: (x) the Guaranteed Party or any of its controlled Affiliates or the Guaranteed Party’s permitted
assigns under this Limited Guaranty or any director of the Company in his or her capacity as such (other than any director that is also
a Parent Party) asserts in any legal proceeding that the provisions of Section 1 limiting the Guarantor’s liability to the applicable
Caps or Section 8 or 9 of this Limited Guaranty are illegal, invalid or unenforceable in whole or in part, or asserting any theory of
liability against the Guarantor or any Non-Recourse Party with respect to the transactions contemplated by the Merger Agreement, the Equity
Commitment Letter, this Limited Guaranty or any transactions contemplated hereby and thereby other than liabilities in connection with
the Retained Claims (against the Person specifically identified with respect to such Retained Claim) or (y) the Family Limited Guaranty
terminates pursuant to Section 8(b)(x) thereof, then (i) the obligations of the Guarantor under this Limited Guaranty shall terminate
ab initio and shall thereupon be null and void, (ii) if the Guarantor has previously made any payments under this Limited Guaranty,
it shall be entitled to recover such payments from the Guaranteed Party, and (iii) neither the Guarantor nor any Non-Recourse Party shall
have any liability to the Guaranteed Party or any of its Subsidiaries with respect to the Merger Agreement, the Equity Commitment Letter,
this Limited Guaranty or the transactions contemplated by the Merger Agreement. Notwithstanding anything to the contrary contained herein,
nothing in this Limited Guaranty is intended to limit the obligations of Parent or Merger Sub under the Merger Agreement.
9. No
Recourse. Notwithstanding anything that may be expressed or implied in this Limited Guaranty or any document or instrument delivered
in connection herewith, by its acceptance of the benefits of this Limited Guaranty, the Guaranteed Party covenants, agrees and acknowledges
that no Person other than the Guarantor (and its permitted assigns) has any liabilities, obligations, or commitments (whether known or
unknown or whether contingent or otherwise) hereunder and that, notwithstanding that the Guarantor (and any assignee permitted under Section
6 hereof) may be a partnership or limited liability company, the Guaranteed Party has no right of recovery under this Limited Guaranty,
or any claim based on such liabilities, obligations, and commitments against, and no personal liability whatsoever shall attach to, be
imposed upon or otherwise be incurred by, the former, current or future equity holders, controlling persons, directors, officers, employees,
agents, Affiliates (other than any assignee permitted under Section 6 hereof, under Section 4 of the Equity Commitment Letter or
under the Family Limited Guaranty), members, managers or general or limited partners of any of the Guarantor or Parent or of Merger Sub
or any former, current or future stockholder, controlling person, director, officer, employee, general or limited partner, member, manager,
Affiliate (other than any assignee permitted under Section 6 hereof, under Section 4 of the Equity Commitment Letter or under the
Family Limited Guaranty), financing sources or agent of any of the foregoing and their successors or assigns (collectively, but not including
the Guarantor, Parent and Merger Sub, or their respective successors and permitted assigns, each a “Non-Recourse Party”),
through Parent hereunder, whether by or through attempted piercing of the corporate veil, by or through a claim by or on behalf of Parent
against any Non-Recourse Party, by the enforcement of any assessment or by any legal or equitable proceeding, by virtue of any statute,
regulation or applicable Law, or otherwise, except pursuant to the Retained Claims (against the Person specifically identified with respect
to such Retained Claim and in the circumstances provided therein). The Guaranteed Party further covenants, agrees and acknowledges that
the only rights of recovery that the Guaranteed Party has in respect of the Merger Agreement, the Equity Commitment Letter, the other
Transaction Documents, or the transactions contemplated thereby or in connection therewith, against the Non-Recourse Parties are the Retained
Claims. The Guaranteed Party acknowledges and agrees that Parent has no assets other than certain contract rights and that no additional
funds are expected to be contributed to Parent unless the Closing occurs and only substantially concurrently therewith in accordance with
the terms of the Equity Commitment Letter. Recourse against the Guarantor under and pursuant to the terms of this Limited Guaranty shall
be the sole and exclusive remedy of the Guaranteed Party and all of its controlled Affiliates against the Guarantor and the Non-Recourse
Parties in respect of any liabilities or obligations arising under, or in connection with, the Merger Agreement, the Equity Commitment
Letter or the transactions contemplated thereby, including by piercing of the corporate veil or by a claim by or on behalf of Parent,
other than the Retained Claims (against the Person specifically identified with respect to such Retained Claim and in the circumstances
provided therein). Notwithstanding the foregoing, nothing in this Limited Guaranty shall restrict the ability of the Guaranteed Party
to bring the Retained Claims against the Person specifically identified therein to the extent permitted thereby, nor shall it limit the
liability or the obligations of such Person under such Retained Claim, which liability shall be subject to the limitations applicable
to the corresponding Retained Claim.
10. Governing
Law; Submission to Jurisdiction; Waiver of Jury Trial.
(a) Except
to the extent the Laws of the State of Washington are mandatorily applicable, this Limited Guaranty and all Actions (whether based on
Contract, tort or otherwise) arising out of or relating to this Limited Guaranty or the actions of the Guarantor or the Guaranteed Party
in the negotiation, administration, performance and enforcement thereof, shall be governed by, and construed in accordance with the laws
of the State of Delaware, without giving effect to any choice or conflict of laws provision or rule (whether of the State of Delaware
or any other jurisdiction) that would cause the application of the Laws of any jurisdiction other than the State of Delaware.
(b) Each
of the parties hereto hereby (i) expressly and irrevocably submits to the exclusive personal jurisdiction of the state courts of the Delaware
Court of Chancery, any other court of the State of Delaware or any federal court sitting in the State of Delaware, in the event any dispute
arises out of or relates to this Limited Guaranty or the transactions contemplated hereby, (ii) agrees that it will not attempt to
deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (iii) agrees that it will not bring
any Action relating to this Limited Guaranty or the transactions contemplated hereby in any court other than the Delaware Court of Chancery,
any other court of the State of Delaware or any federal court sitting in the State of Delaware, (iv) waives, to the fullest extent it
may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any Action arising out of
or relating to this Limited Guaranty and (e) agrees that the other party hereto shall have the right to bring any Action for enforcement
of a judgment entered by the state courts of the Delaware Court of Chancery, any other court of the State of Delaware or any federal court
sitting in the State of Delaware. Each of the Guarantor and the Guaranteed Party agrees that a final judgment in any Action shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law, and the Guarantor consents
to such enforcement and covenants not to oppose such enforcement in any jurisdiction. The Guarantor hereby appoints Cogency Global Inc.
as its authorized agent (the “Authorized Agent”) upon whom process may be served in any Action arising out of
or relating to this Limited Guaranty or the transactions contemplated hereby that may be instituted in the Delaware Court of Chancery,
any other court of the State of Delaware or any federal court sitting in the State of Delaware by the parties hereto, and service of process
on the Authorized Agent shall be deemed effective service of process upon the Guarantor.
(c) EACH
PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION (WHETHER BASED ON CONTRACT,
TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS GUARANTY OR THE ACTIONS
OF THE GUARANTOR OR THE GUARANTEED PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF. EACH PARTY HERETO (A)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH PARTY WOULD
NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS GUARANTY BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS section
10(c).
11. Counterparts.
This Limited Guaranty and any amendments or waivers hereto may be executed in one or more counterparts, all of which will be considered
one and the same agreement and will become effective when one or more counterparts have been signed by each party hereto and delivered
to the other parties hereto, it being understood that all parties need not sign the same counterpart. Any such counterpart, to the extent
delivered by fax or .pdf, .tif, .gif, .jpg or similar attachment to electronic mail (any such delivery, an “Electronic Delivery”),
will be treated in all manner and respects as an original executed counterpart and will be considered to have the same binding legal effect
as if it were the original signed version thereof delivered in person. No party hereto may raise the use of an Electronic Delivery to
deliver a signature, or the fact that any signature or agreement or instrument was transmitted or communicated through the use of an Electronic
Delivery, as a defense to the formation of a contract, and each party hereto forever waives any such defense, except to the extent such
defense relates to lack of authenticity.
12. No
Third Party Beneficiaries. Except as provided in Section 9 hereof for the benefit of the Non-Recourse Parties, the parties
hereby agree that their respective representations, warranties and covenants set forth herein are solely for the benefit of the parties
hereto and their respective successors and permitted assigns, and nothing set forth in this Limited Guaranty shall be construed to confer
upon or give to any Person, other than the parties hereto and their respective successors and permitted assigns, any benefits, rights
or remedies under or by reason of, or any rights to enforce the obligations set forth herein.
13. Confidentiality.
This Limited Guaranty shall be treated as confidential and is being provided to the Guaranteed Party solely in connection with the Merger
Agreement. This Limited Guaranty may not be used, circulated, quoted or otherwise referred to in any document, except with the written
consent of the Guarantor; provided that no such written consent shall be required for any disclosure of the existence or terms
of this Limited Guaranty to the parties to the Merger Agreement or their Representatives with a need to know in connection with the transactions
contemplated by the Merger Agreement, to the extent required by applicable Law or the applicable rules of any national securities exchange,
in connection with the Guaranteed Party’s and Parent’s filings with the SEC relating to the transactions contemplated by the
Merger Agreement, or if required in connection with any required filing or notice with any Governmental Authority relating to the transactions
contemplated by the Merger Agreement. The Guaranteed Party will permit the Guarantor the opportunity to comment on any such required disclosure
to the extent practicable, which the Guaranteed Party will consider in good faith (it being agreed that by providing Parent an opportunity
to comment on such required disclosure, the Guaranteed Party will be deemed to have provided the Guarantor the opportunity to comment
on such required disclosure). Following the filing of this Limited Guaranty with the SEC, the parties shall have no obligations pursuant
to the first two sentences of this Section 13.
14. Miscellaneous.
(a) Together
with the Merger Agreement and the other Transaction Documents to which the Guarantor is a party, and the other agreements and instruments
contemplated hereby or thereby, this Limited Guaranty letter constitutes the entire agreement of the parties hereto and supersedes all
prior agreements and understandings, both written and oral, among or between any of the parties with respect to the subject matter hereof
and thereof.
(b) No
amendment, modification or waiver of any provision hereof shall be enforceable unless approved in writing by (i) in the case of an amendment
or modification, the Guaranteed Party and the Guarantor and (ii) in the case of a waiver, the party against whom the waiver is to be effective.
No delay or omission on the part of the Guaranteed Party in exercising any right, power or remedy under this Limited Guaranty will operate
as a waiver thereof.
(c) If
any term, provision, covenant or restriction of this Limited Guaranty is held by a court of competent jurisdiction or other Governmental
Authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Limited Guaranty
shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance
of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such a determination, the
parties shall negotiate in good faith to modify this Limited Guaranty so as to effect the original intent of the parties as closely as
possible in an acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the fullest
extent possible. Notwithstanding the foregoing, the parties intend that the remedies and limitations thereon contained in this Limited
Guaranty, including the Caps and the provisions of Section 8, Section 9 and this Section 14(c), hereof, be construed
as an integral provision of this Limited Guaranty and that such remedies and limitations shall not be severable in any manner that increases
liability or obligations hereunder of any party hereto or of the Guarantor or of any Non-Recourse Party.
(d) Section
9.3(c) of the Merger Agreement is incorporated by reference herein, mutatis mutandis.
(e) All
parties acknowledge that each party and its counsel have reviewed this Limited Guaranty and that any rule of construction to the effect
that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Limited Guaranty.
15. No
Partnership. The Guaranteed Party acknowledges and agrees that (a) this Limited Guaranty and the Family Limited Guaranty is not
intended to, and do not, create any agency, partnership, fiduciary or joint venture relationship between or among the Guarantor and the
Family Guarantors and neither this Limited Guaranty, the Family Limited Guaranty, nor any other document or agreement entered into by
any party hereto or thereto, as applicable, relating to the subject matter hereof shall be construed to suggest otherwise and (b) the
determination of the Guarantor to enter into this Limited Guaranty and the determination of the Family Guarantors to enter into the Family
Limited Guaranty were independent of each other. Notwithstanding anything to the contrary contained in this Limited Guaranty or the Family
Limited Guaranty, the liability of the Guarantor, on the one hand, and the Family Guarantors, on the other hand, shall be several, not
joint or joint and several.
* * * * *
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EL PUERTO DE LIVERPOOL, S.A.B. DE C.V. |
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By: |
/s/ Graciano Francisco Guichard González |
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Name: |
Graciano Francisco Guichard González |
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Title: |
Chairman of the Board |
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By: |
/s/ Enrique Güijosa Hidalgo |
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Name: |
Enrique Güijosa Hidalgo |
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Title: |
Chief Executive Officer |
[Signature Page to Limited
Guaranty El Puerto de Liverpool, S.A.B. de C.V.]
| Agreed to and accepted: |
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| NORDSTROM, INC. |
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| By: |
/s/ Cathy R. Smith |
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| |
Name: |
Cathy R. Smith |
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Title: |
Chief Financial Officer |
|
[Signature Page to Limited Guaranty (Liverpool)]
Exhibit (c)(iii)
PRELIMINARY & CONFIDENTIAL PROJECT NORSE PRESENTATION TO THE BOARD OF DIRECTORS DECEMBER 22, 2024
PRELIMINARY & CONFIDENTIAL ▪ Throughout 2023, at the request of the Norse Board of Directors, management worked with Morgan Stanley and Centerview Partners to independently evaluate value creation options due to persistent negative public market investor sentiment around the Department Store category and the industry’s long - term prospects ▪ On February 11 th , 2024, the Special Committee was formed to oversee the process to explore a potential take - private transaction following interest expressed by Erik and Pete Nordstrom in submitting a proposal ▪ On March 19 th , 2024, Reuters reported that the Nordstrom Family was seeking to take the Company private – Following the report, Norse’s stock experienced +9% 1 - day and +18% 3 - day price increases – Consequently, the pre - report price of $17.06 as of March 18 th has been referenced as the “unaffected” share price ▪ At the request of the Special Committee, Morgan Stanley and Centerview Partners engaged in discussions with 19 strategic and financial parties to gauge interest in exploring a transaction – 10 parties executed NDAs and 8 parties received additional due diligence information and met with company management – One party formally indicated interest in an acquisition and one party indicated interest in a sale - leaseback, however ultimately withdrew from the process ▪ On September 3 rd , the Special Committee received a non - binding written proposal for a potential acquisition of the Company, from a Bid Group comprised of members of the Nordstrom Family and Liverpool who collectively already own approximately 43% of Norse’s common stock – Offer to acquire the common stock of the Company for a cash purchase price of $23.00 per share – Offer contemplated pro forma ownership of ~50.1% by members of the Nordstrom Family and ~49.9% by Liverpool – After further discussions between September and November, the Bid Group raised its offer to $24.25 per share plus a special dividend of up to $0.25 per share and a “stub period” dividend based on $0.19 per share regular quarterly dividend at the discretion of the Board upon closing and depending on cash balances at closing o Offer reflects a ~42% premium to the unaffected price, excluding the potential dividends ▪ The Bid Group intends to rollover the Company’s current senior notes totaling $2.7 billion, $2.4 billion of which are subject to a repurchase right upon a “double - trigger” consisting of (1) a change of control and (2) a ratings downgrade by all of Moody’s, S&P and Fitch – In December 2024, the Bid Group and Company Management held discussions with the rating agencies and received feedback that S&P would downgrade Norse’s Senior Notes and Debentures while Moody’s and Fitch indicated that they would hold ratings following additional discussions during which the Bid Group committed to secure the Senior Notes and Debentures following the transaction closing 2 SITUATION UPDATE Sources: Capital IQ, Norse Management
PRELIMINARY & CONFIDENTIAL 3 174.9 Diluted Shares Outstanding (2) $4,242 Total Equity Value 2,012 (+) Net Debt (3) $6,254 Total Aggregate Value Aggregate Value / Adj. EBITDA (4) : 5.5x $1,138 Management LTP - FY'24E (5) 4.9x $1,276 Management LTP - FY'25E (5) 5.3x $1,173 Consensus - FY'24E 5.3x $1,174 Consensus - FY'25E Proposal Metric $24.25 BID GROUP PROPOSAL: IMPLIED PREMIA AND MULTIPLES Multiples Premia Source: Norse management, company filings, FactSet and Capital IQ as of December 20, 2024. (3) (4) (5) Note: Dollars in millions, except per share amounts. Figures exclude one - time special dividend of up to $0.25 per share. (1) As of unaffected date of March 18, 2024, the last trading day prior to Reuters' report that the Nordstrom Family was seeking to take the Company private. (2) Fully diluted shares outstanding include basic shares of ~165.0mm as well as full accelerated vesting of dilutive equity securities including options, PSUs and RSUs as of December 20, 2024 per Norse management. Reflects debt of $2,689mm as of Q3’24 per Norse management and cash of $677mm ($397mm as of Q3’24 per Norse management pro forma for $280mm of cash received in Q4’24 in connection with the amended program agreement with TD). Adj. EBITDA figures unburdened by amortization of developer reimbursements. Norse projections per Norse management as approved for each of Centerview’s and Morgan Stanley’s use for its financial analysis and fairness opinion (the “LTP Case”). +42.1% $17.06 Unaffected Price (3/18/24) +27.1% $19.08 30 - Day VWAP ed (1) +29.7% $18.70 60 - Day VWAP ffe ct +85.4% $13.08 52 - Week Low (11/13/23) Un a +4.1% $23.30 52 - Week High (8/1/23) (1.1%) $24.53 Current Price (12/20/24) Current +4.9% $23.11 30 - Day VWAP +5.4% $23.02 60 - Day VWAP +43.5% $16.90 52 - Week Low (1/3/24) (2.6%) $24.90 52 - Week High (11/25/24) Proposal Metric $24.25 Share Price Premium to:
PRELIMINARY & CONFIDENTIAL Notes $MM Sources # • Based on Buyer Group’s projected cash at close; assumes transaction close at Q1 2025 $914 Projected Company Cash on Balance Sheet 1 • Existing debt inclusive of unamortized discounts and debt issuance costs 2,690 Rollover of Existing Debt 2 • Parent will enter into debt commitment papers for an up to $1,200MM ABL (expects to draw up to $450MM at closing) • Commitment letter to be provided at signing 450 New Transaction Debt 3 • ~95% of current holdings (~51.1MM shares) 1,238 Nordstrom Family Equity Rollover 4 • Alternate structure with loan made from Liverpool to the Parent SPV (49.9% owned by Liverpool), funded through balance sheet cash and debt (committed bridge facility or bond offering) 510 Funding into Parent SPV 5 • Current holdings (~15.8MM shares) 382 Liverpool Equity Rollover 6 • Funded through balance sheet cash and debt (committed bridge facility or bond offering) 851 Liverpool New Equity 7 $7,035 Total Sources SOURCES & USES FOR THE TRANSACTION Notes $MM Uses # • Based on ~165.0MM basic shares outstanding plus dilutive equity securities (1) of ~0.6MM in - the - money options, ~0.3MM of PSUs and ~2.2MM of RSUs at $24.25 / share $4,078 Company Equity Value 8 • Reflects potential special dividend of up to $0.25 per share (based on Company’s cash balance) at the discretion of the Board upon closing 42 (2) Special Dividend 9 • Existing debt inclusive of unamortized discounts and debt issuance costs 2,690 Company Existing Debt 10 • Fully accounts for advisor fee estimates provided by Company advisors and financing fees required to consummate the transaction 125 Estimated Transaction Fees 11 • Based on Family Group advisor estimates 100 Minimum Cash to Balance Sheet 12 $7,035 Total Uses • Plus a special dividend of up to $0.25 per share (based on Company’s cash balance) and a “stub period” dividend based on $0.19 per share regular quarterly dividend at the discretion of the Board upon closing $24.25 Memo: Price Per Share Source: Norse Management Notes: 1. Assuming closing occurs between March 10 and June 10, 2025 2. Does not include the “stub period” dividend 4
PRELIMINARY & CONFIDENTIAL 5 ▪ Members of the Nordstrom family and related trusts (the “Family Group”) and El Puerto de Liverpool S.A.B. de C.V. (“Liverpool”) will form a new entity (“Parent”) to acquire Norse Purchaser ▪ Holders of Norse common stock (other than the Family Group and Liverpool) will receive $24.25 per share ▪ The Family Group and Liverpool (holding ~43% of outstanding shares) will roll their Norse shares in exchange for Parent common stock ▪ The Board is permitted to declare a special dividend of up to $0.25 per share (based on Company cash on hand), which will be contingent on closing ▪ Unvested equity awards will be converted into cash - settled awards Consideration, Equity Awards and Special Dividend ▪ Shareholder approval by (1) two - thirds of outstanding shares and (2) majority of the shareholders other than the Family Group, Liverpool, and the Company’s directors and Section 16 officers ▪ Expiration or termination of HSR waiting period ▪ No order by US court prohibiting merger ▪ No “Below Investment Grade Rating Event” under the Company’s senior notes ▪ Each party’s obligations would also be subject to the accuracy of other party’s representations (subject to customary materiality exceptions) and material compliance with its covenants Conditions ▪ Failure to achieve shareholder approval ▪ US court issues order prohibiting the merger ▪ Occurrence of a Below Investment Grade Rating Event (subject to cure period) ▪ Other party materially breaches its representations or covenants (subject to cure periods) ▪ Company only - Company accepts a superior proposal or Parent refuses to close when required to do so ▪ Parent only - Board changes its recommendation (only for 10 business days after change) Termination Rights ▪ Company will pay $85MM if deal is terminated because the Board changed its recommendation and $42.5MM if it enters into superior proposal or deal is voted down when there is a competing proposal that is subsequently entered into within 12 months and consummated ▪ Parent will pay $100MM if deal is terminated due to a Below Investment Grade Rating Event and $170MM if deal is terminated because of a Parent material breach or failure to close ▪ In the event of an intentional breach, the breaching party is liable for damages, subject to $300MM cap (inclusive of termination fee) ▪ Company can seek specific performance of Parent’s obligations, except that requiring Parent to close and Liverpool to fund under its equity commitment requires $450MM of debt financing proceeds and $410MM in Company cash (plus amount required to pay the special dividend) ▪ Liverpool and certain members of the Family Group are guaranteeing Parent’s liability for damages in the event of an intentional breach, reverse termination fee, and certain other obligations on a several basis Remedies ▪ Customary no - shop and “fiduciary out” provisions ▪ Customary interim operating covenants ▪ Covenants relating to each party’s interactions with the rating agencies and requiring the Family Group and Liverpool to be consistent with their RES/RAS presentations ▪ Parent may request the Company commence an exchange offer and consent solicitation and/or grant guarantees or security on the senior notes and debentures (effective on closing) No - Shop and Other Covenants ▪ Parent will enter into debt commitment papers for an up to $1,200MM ABL (expects to draw up to $450MM at closing) ▪ Liverpool will commit to contribute $1,712MM to Parent (which may be equity and/or a loan), and the Company can specifically enforce its commitment ▪ Liverpool will enter into debt commitment papers for a $900MM bridge facility to fund its equity commitment, and intends to launch a bond offering during the interim period Financing Structure ▪ Liverpool and the Family Group will enter into Rollover and Support Agreements that contain a voting commitment to vote in favor of the approval of the transaction and requirement to take, or refrain from taking, other actions related to the deal Voting Commitment KEY MERGER TERMS
PRELIMINARY & CONFIDENTIAL 6 (490bps) (124bps) +126bps - - - 3.9% 3.9% 3.6% 2.2% 1.7% (2.9%) 3.9% 3.9% 3.6% 3.4% 0.5% (7.8%) % Y/Y Growth - - - - - - - - (40) (78) 1,521 1,406 1,340 1,276 1,178 446 1,521 1,406 1,340 1,276 1,138 367 Adj. EBITDA (1) - - - - (18bps) (141bps) 9.2% 8.8% 8.7% 8.6% 8.1% 10.7% 9.2% 8.8% 8.7% 8.6% 7.9% 9.3% % Net Sales - - - - (17bps) (137bps) 8.9% 8.6% 8.5% 8.4% 7.9% 10.4% 8.9% 8.6% 8.5% 8.4% 7.7% 9.0% % Total Sales - - - - - - - - +4 - - (532) (530) (571) (602) (600) (145) (532) (530) (571) (603) (596) (145) ( - ) Total D&A - - - - - - - - (35) (78) 989 876 769 674 577 301 989 876 769 674 542 222 Adj. EBIT - - - - (20bps) (159bps) 6.0% 5.5% 5.0% 4.6% 4.0% 7.2% 6.0% 5.5% 5.0% 4.6% 3.8% 5.6% % Net Sales - - - - (19bps) (155bps) 5.8% 5.3% 4.9% 4.4% 3.9% 7.0% 5.8% 5.3% 4.9% 4.4% 3.7% 5.5% % Total Sales - - - - - - - - +9 +17 (267) (236) (208) (182) (153) (78) (267) (236) (208) (182) (144) (61) ( - ) Taxes - - - - - - - - (27) (61) 722 639 561 492 424 223 722 639 561 492 398 162 NOPAT - - - - - - - - - - - - 497 493 531 552 538 131 497 493 531 552 538 131 (+) D&A - - - - - - - - (4) (1) 35 37 40 50 62 14 35 37 40 50 58 14 (+) Amort. Of Dev. Reimb. - - - - - - - - +1 - - 202 196 191 187 185 47 202 196 191 187 186 47 (+) Right - of - use Asset Amort. - - - - - - - - (1) - - (288) (279) (272) (267) (264) (67) (288) (279) (272) (267) (266) (67) ( - ) Lease Liabilities - - - - - - - - +225 +189 (28) (49) (51) (104) (80) 182 (28) (49) (51) (104) 145 371 (+/ - ) Change in NWC +5 +5 +5 (8) (22) (37) (474) (457) (440) (422) (477) (142) (469) (452) (435) (430) (500) (179) ( - ) Capex +5 +5 +5 (8) +172 +92 665 580 560 488 387 387 671 584 566 481 559 479 Unlevered FCF December LTP August LTP Δ (December vs. August) Management Projections Management Projections Management Projections Quarters Annuals Quarters Annuals Quarters Annuals Q4 2024E 2024E 2025E 2026E 2027E 2028E Q4 2024E 2024E 2025E 2026E 2027E 2028E Q4 2024E 2024E 2025E 2026E 2027E 2028E Net Sales 3,967 14,320 14,792 15,319 15,910 16,525 4,177 14,498 14,792 15,319 15,910 16,525 (210) (178) - - - - -- - - % Y/Y Growth (7.6%) 0.7% 3.3% 3.6% 3.9% 3.9% (2.7%) 2.0% 2.0% 3.6% 3.9% 3.9% (489bps) (125bps) +127bps - - - Total Revenues 4,074 14,766 15,272 15,819 16,433 17,074 4,291 14,949 15,272 15,819 16,433 17,074 (217) (182) - - - - - - - - NORSE FINANCIAL SUMMARY – LTP COMPARISON In $MM, Unless Otherwise Stated Key Drivers of Change in Plan ▪ Reduced 2024E sales on lower GMV/sales signals as the Company entered the fourth fiscal quarter ▪ Reduced 2024E Adj. EBIT on lower sales and additional promotional mark - downs to support cleaner inventory position by YE ▪ Increased 2024E NWC mostly on TD proceeds received in November 2024 (not accounted for prior) ▪ Increased 2024E capex to reflect targeted $500MM in spend; increased 2025E capex driven by technology capex to support future efficiencies; reduced 2026E - 2028E capex due to slight decrease in capital need post evaluating cost investments Source: LTP Case Note: 1. EBITDA unburdened by amortization of developer reimbursements
PRELIMINARY & CONFIDENTIAL 14,693 15,524 15,530 14,885 14,766 15,173 15,272 15,494 15,819 16,433 17,074 (1%) +1% +2% 567 569 543 784 502 554 542 674 769 876 989 Margin FY2019A (% of Revenues): 5.1% FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A 5.8% 5.3% 3.5% 4.9% 3.8% 4.4% 3.7% 3.7% 3.9% 3.2% (2%) +18% +42% FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A FY2019A 8.9% 8.6% 7.5% 8.5% 7.7% 8.4% 7.9% 7.7% 7.8% 7.1% 9.4% FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A FY2019A 3.9% 3.9% 2.1% 3.6% 1.9% 3.4% 1.3% 0.5% (5.4%) 5.0% Growth: (2.1%) +15% +8% (3%) 1,521 1,406 1,340 1,169 1,174 1,276 1,173 1,138 1,153 1,106 1,455 LTP Case (December 2024) 7 LTP Case vs. Consensus Historical Consensus Sources: Capital IQ as of December 20, 2024; LTP Case; Company filings Note: 1. Adds back all depreciation and amortization including amortization of developer reimbursements Margin (% of Revenues): Adj. EBIT ($MM) Adj. EBITDA ($MM) (1) Total Revenues ($MM) NORSE’S LTP CASE VS. STREET PROJECTIONS Actual Performance Projections FY’24E – FY26E CAGR 2.0% 3.5% (0.2%) 8.5% (1.0%) 19.1%
PRELIMINARY & CONFIDENTIAL Methodology Metric ($MM) Implied Share Price Agg. Value ($MM) Low High Rounded to the nearest $0.25 Public Trading Comparables (1)(2) LTP Case: AV / FY2024E EBITDA: 3.5x - 5.0x LTP Case: AV / FY2025E EBITDA: 3.5x - 5.0x 1,138 1,276 3,982 4,467 5,689 6,382 Discounted Equity Value (3) LTP Case: 3.5x - 5.0x FY2026E EBITDA 1,340 4,986 6,691 Discounted Cash Flow (1) LTP Case: 3.5x - 5.0x Exit Multiple; 8.8% - 9.8% WACC 5,642 7,391 Reference Only: 52 - Week Trading Range Analyst Price Targets (Undiscounted) ( 4 ) Analyst Price Targets (Discounted) ( 4 )( 5 ) Consensus Trading Comparables : AV / FY 2024 E EBITDA : 3 . 5 x - 5 . 0 x ( 1 )( 2 ) Consensus Trading Comparables : AV / FY 2025 E EBITDA : 3 . 5 x - 5 . 0 x ( 1 )( 2 ) Consensus Discounted Equity Value : 3 . 5 x - 5 . 0 x FY 2026 E EBITDA ( 3 ) 4,986 4,548 4,242 4,106 4,109 4,636 6,385 6,560 5,992 5,866 5,870 6,123 1,173 1,174 1,169 Leveraged Buyout (6) LTP Case: 17.5% - 22.5% Target IRR; Exit Multiple Range of 3.5 - 5.0x 5,573 6,401 $11.25 $14.00 $17.00 $20.75 $17.00 $14.50 $12.75 $12.00 $12.00 $15.00 $21.50 $21.00 $25.00 $26.75 $30.75 $25.00 $26.00 $22.75 $22.00 $22.00 $23.50 $26.50 $0 $10 $20 $30 NORSE PRELIMINARY VALUATION ANALYSIS – MORGAN STANLEY Sources: Capital IQ (unaffected date of March 18, 2024, current as of December 20, 2024); LTP Case; Norse management Notes: 1. Reflects $2,689MM of debt as of fiscal Q3 2024 and $677MM of cash comprised of the Company’s cash balance of $397MM as of fiscal Q3 2024 plus $280MM of incremental cash received in connection with the TD program agreement amendment in November 2024 per Norse Management 2. Fully diluted share count of ~174.9MM provided by Norse Management and reflects ~165.0MM basic shares outstanding as of December 20, 2024 and accelerated vesting of outstanding dilutive securities, including ~0.7MM options, ~1.5MM PSUs, and ~7.6MM RSUs 3. Represents present value of implied year - end 2025E share price based on discounted equity value analysis; share prices and cumulative dividends discounted at a ~14.5% cost of equity of Norse 4. Based on median of analyst price targets as of December 20, 2024 excludes price targets of brokers that have revised price targets based on transaction - related news as well as Morningstar’s $38.50 price target (see appendix for list of brokers and price targets) 5. Reflects undiscounted analyst price targets discounted one year at Norse’s ~14.5% cost of equity 6. Implied entry price implied by 17.5 - 22.5% target IRR based on LTP Case; assumes full diluted share count of ~165.6MM, inclusive of ~165.0MM of basic shares as of December 20, 2024 per Norse Management plus vesting of ~0.6MM of options through February 2025; the remaining unvested RSUs and options are assumed to convert to cash compensation consistent with the Bid Group’s proposal on October 17, 2024 Unaffected Share Price: $17.06 Consensus LTP Case 8 Offer Price: $24.25 Bid Group Offer Price: $24.25 Excludes Potential Special Dividend of up to $0.25 and “Stub Period” Dividend Based on $0.19 Quarterly Dividend
PRELIMINARY & CONFIDENTIAL 9 Implied AV / '24E EBITDA (2) Methodology Assumption Implied Share Price Value Implied AV 52 - Week Trading Range 52 - Wk High: 11/25/24 52 - Wk Low: 01/03/24 $5,238 – $6,649 4.6x – 5.8x Analyst Price Target Range (1) High: 11/27/24 Low: 11/27/24 $4,818 – $6,843 4.2x – 6.0x Premia Paid Analysis Premium to Unaffected: 25% - 40% $6,017 – $6,469 5.3x – 5.7x 4.0x - 5.0x '24E EBITDA of $1,138mm $4,551 – $5,689 4.0x – 5.0x 4.0x - 5.0x '25E EBITDA of $1,276mm $5,106 – $6,382 4.5x – 5.6x Discounted Cash Flow Analysis (4) WACC: 11.00% - 13.00% PGR: 1.5% - 2.5% $5,960 – $7,696 5.2x – 6.8x Public Trading Comparables (2,3) $16.90 $14.50 $21.30 $14.60 $17.75 $21.00 $24.90 $26.00 $23.90 $21.05 $25.00 $30.80 NORSE PRELIMINARY VALUATION ANALYSIS – CENTERVIEW For Reference Only Note: Implied share prices rounded to the nearest $0.05. Fully diluted shares outstanding include basic shares of ~165.0mm as well as full accelerated vesting of dilutive equity securities including options, PSUs and RSUs as of December 20, 2024 per Norse management. Reflects debt of $2,689mm and cash of $397mm as of Q3’24 per Norse management, except where otherwise noted. EBITDA unburdened by amortization of developer reimbursements. (1) High reflects Telsey; Low reflects UBS. (2) Assumes LTP Case. (3) Implied Share Price Values assume debt of $2,689mm as of Q3’24 per Norse management and cash of $677mm ($397mm as of Q3’24 per Norse management pro forma for $280mm of cash received in Q4’24 in connection with the amended program agreement with TD). (4) DCF valuation date of November 2, 2024. Assumes mid - year discounting and LTP Case. (5) Excludes one - time special dividend of up to $0.25 per share and "stub period" dividend based on $0.19 quarterly dividend. Share Price: $17.06 Source: Norse management, LTP Case, company filings and FactSet as of December 20, 2024. Unaffected Bid Group Price Bid Group Disclosure: Proposal Price: $23.00 $24.25 (5)
PRELIMINARY & CONFIDENTIAL SUPPLEMENTARY MATERIALS 10
PRELIMINARY & CONFIDENTIAL 11 SUPPLEMENTARY MATERIALS A Morgan Stanley Supporting Valuation Analysis B Centerview Supporting Valuation Analysis C Investor Perspectives on Norse's Valuation Multiple
PRELIMINARY & CONFIDENTIAL APPENDIX A MORGAN STANLEY SUPPORTING VALUATION ANALYSIS 12
PRELIMINARY & CONFIDENTIAL 0.9% 5.2% (1.2%) 5.4% (8.8%) (4.3%) 1.6% 1.9% 0.8% 1.5% (4.7%) 0.6% 3.7% 3.7% 3.5% 4.0% 3.2% 4.7% 7.9% 7.7% 7.5% 8.1% 8.1% 8.6% 5.4x 5.5x 4.7x 4.4x 5.1x 3.9x 5.4x 4.9x 4.6x 4.1x 5.2x 3.9x 12.3x 12.3x 9.4x 8.8x 10.8x 6.3x 12.1x 10.7x 8.6x 7.5x 10.2x 6.3x COMPARABLE COMPANY ANALYSIS 13 Sources: Capital IQ as of December 20, 2024; LTP Case Notes: 1. Norse figures add back all depreciation and amortization including amortization of developer reimbursements 2. Norse Current reflects $2,689MM of debt as of fiscal Q3 2024 and $677MM of cash comprised of the Company’s cash balance of $397MM as of fiscal Q3 2024 plus $280MM of incremental cash received in connection with the TD program agreement amendment in November 2024 per Norse Management; Norse Current fully diluted share count of ~174.9MM provided by Norse Management and reflects ~165.0MM basic shares outstanding as of December 20, 2024 and accelerated vesting of outstanding dilutive securities, including ~0.8MM options, ~1.5MM PSUs, and ~7.6MM RSUs on share price of $24.53 as of December 20, 2024 3. Represents Norse as of unaffected date of March 18, 2024 4. Represents Macy’s as of unaffected date of December 8, 2023 CY2025E P / E (x) CY2024E P / E (x) CY2025E AV / EBITDA (x) (1)(2) CY2024E AV / EBITDA (x) (1)(2) CY2024E EBIT Margin (%) CY2024E EBITDA Margin (%) (1) CY’23A – CY’25E EBITDA CAGR (%) (1) CY’23A – CY’25E Revenue CAGR (%) Norse Current Consensus (4) Norse Current LTP Norse Unaffected Consensus (3) Norse Unaffected LTP (3) Morgan Stanley
PRELIMINARY & CONFIDENTIAL Disclosed Valuation Details Date Price Target Rating Firm Name Discounted Cash Flow 12/5/2024 $38.50 Buy Morningstar 12.3x 2026E EPS 11/27/2024 $26.00 Hold Telsey ~11.0x FY2025E EPS 12/19/2024 $25.00 Hold Gordon Haskett ~5x FY2024E AV / EBITDA 11/26/2024 $25.00 Hold Citi FY25 EPS of $2.05 and 12x P/E. 11/27/2024 $25.00 Hold TD Cowen 4.75x 2Y Forward EV/EBITDA 11/26/2024 $24.00 Hold Goldman Sachs 11.5x FY2025 P/E 11/27/2024 $23.00 Hold Jefferies 11.0x NTM P/E Based on CY2026 EPS 11/26/2024 $23.00 Hold Barclays 22.5x AV/EBITDA FY2025E 11/27/2024 $22.00 Sell Bank of America 10.0x 2026 EPS 11/26/2024 $22.00 Hold Evercore ~10.0x FY2025 EPS 11/29/2024 $22.00 Hold BMO ~4.3x 2026E EBITDA 11/26/2024 $21.00 Sell JP Morgan ~0.3x 2026E AV / Sales 11/27/2024 $14.50 Sell UBS NA 11/27/2024 NA Hold Guggenheim NA 12/9/2024 NA Hold William Blair 12.2x 2025E P/E & 6.8x 2025E AV / EBITDA 12/2/2024 NA Hold KeyBanc NA 11/27/2024 NA NA Morgan Stanley $20.09 (2) $23.00 Median (1) $19.79 (2) $22.65 Mean (1) ANALYST PRICE TARGETS 14 Sources: Capital IQ, Wall Street Equity Research as of December 20, 2024 Notes: 1. Morningstar, KeyBanc, Barclays, Jefferies and Morgan Stanley Price Target excluded from median and mean calculations 2. Represents present value share price discounted using Morgan Stanley's estimated cost of equity of Norse of ~14.5% as of December 20, 2024 For Reference Only Excluded Brokers with Revised Price Targets Based on Transaction - Related News Morgan Stanley
PRELIMINARY & CONFIDENTIAL $15.57 $17.03 $17.06 $20.86 $21.88 $26.15 $26.74 Current 2024E 2025E $16.10 $20.06 $21.58 $25.80 $17.06 $27.05 $31.55 Current 2024E 2025E AV / NTM Adj. EBITDA of 5.00x Future Share Price (Incl. Dividends) (1) $MM / Share Present Value of Future Share Price (Incl. Dividends) (1) (2) $MM / Share 1. Calculated as NTM EBITDA multiplied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by fully diluted share count of ~174.9MM provided by Norse Management and reflects ~165.0MM basic shares outstanding as of December 20, 2024 and accelerated vesting of outstanding dilutive securities, including ~0.7MM options, ~1.5MM PSUs, and ~7.6MM RSUs; inclusive of future value of cumulative dividends per share discounted to present value 2. Discounted to October 31, 2024 valuation date at ~14.5% cost of equity of Norse as of December 20, 2024 3. Market data as of unaffected date of March 18, 2024; Current share price as of December 20, 2024 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 1,340 5.0x 1,276 4.3x 1,340 4.3x 1,276 3.5x 1,340 3.5x 1,276 AV / NTM Adj. EBITDA Multiple (x) NTM Adj. EBITDA 6,701 6,382 5,695 5,425 4,690 4,467 Future Aggregate Value (1,441) (1,777) (1,441) (1,777) (1,441) (1,777) ( - ) Net Debt 5,259 4,605 4,254 3,648 3,249 2,691 Future Equity Value 175 175 175 175 175 175 FDSO (1) $30.07 $26.33 $24.32 $20.86 $18.58 $15.38 Future Share Price ($USD) $31.55 $27.05 $25.80 $21.58 $20.06 $16.10 Future Share Price Incl. Dividends 1.25 0.25 1.25 0.25 1.25 0.25 Periods 0.84 0.97 0.84 0.97 0.84 0.97 Discount Factor (2) $25.40 $25.45 $20.54 $20.16 $15.69 $14.87 Discounted Share Price ($USD) $26.74 $26.15 $21.88 $20.86 $17.03 $15.57 Discounted Share Price Incl. Dividends 40.1% 37.1% 14.7% 9.3% (10.8%) (18.4%) Premium / (Discount) to Unaffected 30D VWAP ($19.08) 56.7% 53.3% 28.3% 22.3% (0.2%) (8.7%) Premium / (Discount) to Unaffected ($17.06) (3) 9.0% 6.6% (10.8%) (15.0%) (30.6%) (36.5%) Premium / (Discount) to Current ($24.53) (3) Denotes range on FBF Sources: Capital IQ as of December 20, 2024; LTP Case Notes: ILLUSTRATIVE DISCOUNTED EQUITY VALUE | LTP CASE 3.50x NTM Adj. EBITDA 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x 5.00x NTM Adj. EBITDA 15 Morgan Stanley
PRELIMINARY & CONFIDENTIAL $15.02 $14.94 $17.06 $19.88 $19.18 $24.75 $23.41 Current 2024E 2025E $15.53 $17.59 $20.57 $22.60 $17.06 $25.60 $27.61 Current 2024E 2025E 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 1,169 5.0x 1,174 4.3x 1,169 4.3x 1,174 3.5x 1,169 3.5x 1,174 AV / NTM Adj. EBITDA Multiple (x) NTM Adj. EBITDA 5,845 5,870 4,968 4,990 4,092 4,109 Future Aggregate Value (1,174) (1,518) (1,174) (1,518) (1,174) (1,518) ( - ) Net Debt 4,671 4,352 3,794 3,471 2,917 2,591 Future Equity Value 175 175 175 175 175 175 FDSO (1) $26.70 $24.88 $21.69 $19.85 $16.68 $14.81 Future Share Price ($USD) $27.61 $25.60 $22.60 $20.57 $17.59 $15.53 Future Share Price Incl. Dividends 1.25 0.25 1.25 0.25 1.25 0.25 Periods 0.84 0.97 0.84 0.97 0.84 0.97 Discount Factor (2) $22.55 $24.05 $18.32 $19.19 $14.09 $14.32 Discounted Share Price ($USD) $23.41 $24.75 $19.18 $19.88 $14.94 $15.02 Discounted Share Price Incl. Dividends 22.7% 29.7% 0.5% 4.2% (21.7%) (21.3%) Premium / (Discount) to Unaffected 30D VWAP ($19.08) 37.2% 45.1% 12.4% 16.6% (12.4%) (12.0%) Premium / (Discount) to Unaffected ($17.06) (3) (4.6%) 0.9% (21.8%) (18.9%) (39.1%) (38.8%) Premium / (Discount) to Current ($24.53) (3) AV / NTM Adj. EBITDA of 5.00x Future Share Price (Incl. Dividends) (1) $MM / Share Present Value of Future Share Price (Incl. Dividends) (1)(2) $MM / Share For Reference Only ILLUSTRATIVE DISCOUNTED EQUITY VALUE | CONSENSUS 3.50x NTM Adj. EBITDA 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x 5.00x NTM Adj. EBITDA 16 Morgan Stanley Denotes range on FBF Sources: Capital IQ as of December 20, 2024; Capital IQ consensus estimates as of December 20, 2024 Notes: 1. Calculated as NTM EBITDA multiplied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by fully diluted share count of ~174.9MM provided by Norse Management and reflects ~165.0MM basic shares outstanding as of December 20, 2024 and accelerated vesting of outstanding dilutive securities, including ~0.7MM options, ~1.5MM PSUs, and ~7.6MM RSUs; inclusive of future value of cumulative dividends per share discounted to present value 2. Discounted to October 31, 2024 valuation date at ~14.5% cost of equity of Norse as of December 20, 2024 3. Market data as of unaffected date of March 18, 2024; Current share price as of December 20, 2024
PRELIMINARY & CONFIDENTIAL Implied Share Price – Increase in NWC calculated from a 2% revenue growth 5.00x 4.25x 3.50x Terminal EBITDA Exit Multiple into perpetuity 9.8% 9.3% 8.8% 9.8% 9.3% 8.8% 9.8% 9.3% 8.8% Discount Rate Present Value of: 2,325 2,346 2,367 2,325 2,346 2,367 2,325 2,346 2,367 Forecasted Free Cash Flow 5,107 5,212 5,320 4,341 4,431 4,522 3,575 3,649 3,724 Terminal Value 7,432 7,558 7,687 6,666 6,777 6,889 5,900 5,995 6,091 Implied Aggregate Value (2,292) (2,292) (2,292) (2,292) (2,292) (2,292) (2,292) (2,292) (2,292) ( - ) Net Debt (3) 5,140 5,266 5,395 4,374 4,484 4,597 3,608 3,702 3,799 Implied Equity Value 175 175 175 175 175 175 175 175 175 Fully Diluted Shares (4) $29.39 $30.11 $30.84 $25.01 $25.64 $26.28 $20.63 $21.17 $21.72 Implied Price Per Share ($USD) 0% (0%) (0%) (1%) (1%) (2%) (3%) (4%) (4%) Implied Perpetuity Growth Rate 20% 23% 26% 2% 5% 7% (16%) (14%) (11%) % Premium / (Discount) to Current (5) 72% 76% 81% 47% 50% 54% 21% 24% 27% % Premium / (Discount) to Unaffected (6) 6.5x 6.6x 6.8x 5.9x 6.0x 6.1x 5.2x 5.3x 5.4x Implied AV / 2024E EBITDA 5.8x 5.9x 6.0x 5.2x 5.3x 5.4x 4.6x 4.7x 4.8x Implied AV / 2025E EBITDA 2028E 2027E 2026E 2025E Q4 2024E FYE February 3 17,074 17,074 16,433 15,819 15,272 4,074 Total Revenues 3.9% 3.9% 3.6% 3.4% % Growth 1,521 1,521 1,406 1,340 1,276 367 Adjusted EBITDA 8.9% 8.9% 8.6% 8.5% 8.4% 9.0% % Margin (469) (497) (493) (531) (552) (131) ( - ) D&A (35) (35) (37) (40) (50) (14) ( - ) Amort. Of Developer Reimbursements 1,017 989 876 769 674 222 EBIT 6% 6% 5% 5% 4% 5% % Margin (275) (267) (236) (208) (182) (61) ( - ) Tax Expense 27% 27% 27% 27% 27% 27% % Effective Tax Rate 469 497 493 531 552 131 (+) D&A 35 35 37 40 50 14 (+) Amort. Of Developer Reimbursements 202 202 196 191 187 47 (+) Right of Use Asset Amort. (288) (288) (279) (272) (267) (67) (+) (Increase) / Decrease in Lease Liabilities (15) (28) (49) (51) (104) 371 (+) (Increase) / Decrease in NWC (469) (469) (452) (435) (430) (179) ( - ) CapEx 676 671 584 566 481 479 Unlevered Free Cash Flow 44% 44% 42% 42% 38% 130% % Free Cash Flow Conversion (2) Terminal Key Assumptions • October 31, 2024 valuation date • Financials presented on January - ending fiscal year • 4.25 - year DCF using mid - year discounting convention • WACC range of ~8.8% - 9.8% • Illustrative effective tax rate in years FY24E - FY28E of 27% per Norse management • Terminal year assumptions (1) : – D&A equal to terminal year CapEx Unlevered Free Cash Flow Forecast (1) $MM, unless otherwise noted ILLUSTRATIVE DISCOUNTED CASH FLOW ANALYSIS | LTP CASE Source: LTP Case Notes: 1. Terminal LTM EBITDA assumes 3.9% terminal revenue growth; 8.9% terminal EBITDA margin 2. Free Cash Flow Conversion represents Unlevered Free Cash Flow divided by Adjusted EBITDA 3. Reflects $2,689MM of debt as of fiscal Q3 2024 and $397MM of cash as of fiscal Q3 2024 per Norse Management 4. Fully diluted share count of ~174.9MM provided by Norse Management and reflects ~165.0MM basic shares outstanding as of December 20, 2024 and accelerated vesting of outstanding dilutive securities, including ~0.7MM options, ~1.5MM PSUs, and ~7.6MM RSUs 5. Unaffected date as of March 18, 2024 6. Current market data as of December 20, 2024 Denotes range on FBF 17 Morgan Stanley
PRELIMINARY & CONFIDENTIAL Total (%) Amount ($) Multiple (x) Uses Total (%) Amount ($) Multiple (x) Sources 58% $4,016 3.1x Company Equity Value 39% $2,690 2.1x Rollover of Existing Debt 39% 2,690 2.1x Company Existing Debt 1% 100 0.1x Minimum Cash 2% 125 0.1x Estimated Transaction Fees Special Dividend 0.0x 41 1% Total Uses 5.5x $6,972 100% New Transaction Debt 0.4x $450 6% Cash on Balance Sheet 0.7x $830 12% Nordstrom Family Equity Rollover 0.9x $1,209 17% Liverpool Equity Rollover 0.3x $382 5% New Sponsor Equity (5) 1.1x $1,411 20% Total Sources 5.5x $6,972 100% Target Exit Multiple IRR 3.5x 3.9x 4.3x 4.6x 5.0x 17.5% $22.69 $23.67 $24.65 $25.63 $26.60 18.8% $22.40 $23.33 $24.27 $25.20 $26.14 20.0% $22.12 $23.01 $23.91 $24.80 $25.69 21.3% $21.85 $22.71 $23.56 $24.42 $25.27 22.5% $21.60 $22.42 $23.24 $24.06 $24.88 Key Assumptions • Offer price ($24.25 / share) (1) • Incremental $450MM in transaction debt (2) • Assumes incremental $450MM in transaction debt paid off in FY2025 (~83%) and FY2026 (17%) (3) • Assumes ~$66MM per year in Employee Incentive Plan payments starting FY2025 (3) • Assumes pro forma public company cost impact to SG&A of (~$3MM) in FY2025 and FY2026 and of ~$8MM in FY2027 and FY2028 (3) • Min cash of $100MM • Assumes all excess cash flows paid out to Bid Group as dividends • Assumes Family and Liverpool roll current equity stakes • Effective tax rate of 27% • 4.25 - year hold, with illustrative closing date of fiscal Q3 2024 • Entry Multiple based on NTM EBITDA of $1.3Bn (4) • NTM Exit EBITDA of $1.6Bn Illustrative Sources and Uses $MM, unless otherwise noted 18 ILLUSTRATIVE LEVERAGED BUYOUT ANALYSIS | LTP CASE Sources: Capital IQ as of December 20, 2024; LTP Case Notes: 1. Reflects latest Bid Group offer received on October 17, 2024 unless otherwise stated; assumes full diluted share count of ~165.6MM, inclusive of ~165.0MM of basic shares as of December 20, 2024 per Norse Management plus vesting of ~0.6MM of options through February 2025; the remaining unvested RSUs and options are assumed to convert to cash compensation consistent with the Bid Group’s proposal on October 17, 2024 2. Incremental $450MM assumed draw from ABL at an assumed rate of SOFR + 150 bps based on draft commitment letters 3. Based on December 2024 Norse Rating Agency Presentation assumptions; pro forma public company cost impact to SG&A in 2025 and 2026 includes $10MM of incremental credit card costs 4. Reflects $2,689MM of debt as of fiscal Q3 2024 and $397MM of cash as of fiscal Q3 2024 per Norse Management 5. Includes total new equity contributions from Family and Liverpool; includes Liverpool Loan to Parent SPV for new equity contribution; assumes incremental purchase equity on updated share count vs. October 17, 2024 offer funded via SPV loan Exit Multiple / Target IRR Implied $ per Share Entry = Exit for 17.5 - 22.5% IRR Denotes range on FBF A 20% Internal Rate of Return Implies an $24 Entry Price (~4.9x Entry Multiple) Morgan Stanley
PRELIMINARY & CONFIDENTIAL High Low Base Notes Assumption 4.5% 4.5% 4.5% Spot Rate on 10 - Year U.S. Treasury as of 12/20/2024 Risk Free Rate (R f ) 6.0% 6.0% 6.0% Morgan Stanley Estimated Market Risk Premium Market Risk Premium (MRP) 1.66 1.66 1.66 Predicted U.S. Local Beta per Barra Predicted Beta 1.0% (1.0%) +/ - 1.0% from Base Sensitivity Adjustment 15.5% 13.5% 14.5% Calculated Using the Capital Asset Pricing Model Cost of Equity (K E ) 4.9% 4.9% 4.9% Weighted Average Cost of Debt Pre - tax Cost of Debt (K D ) 27.0% 27.0% 27.0% Per Management Guidance Tax Rate (t) 3.5% 3.5% 3.5% Post - tax Cost of Debt (K D ) 47.4% 47.4% 47.4% Based on Current Capital Structure Debt / Total Capitalization 9.8% 8.8% 9.3% KE * E/(D+E) + KD * (1 - t) * D/(D+E) Weighted Average Cost of Capital (WACC) WACC Calculation Key Assumptions • Cost of Equity: Calculated using the Capital Asset Pricing Model • Risk Free Rate: Based on 10 - year U.S. Treasury as of current market date of December 20, 2024 • Predicted Beta: Predicted U.S. Local Beta per Barra as of unaffected date of March 18, 2024 • Cost of Debt: Norse’s current weighted average cost of debt • Tax Rate: Implied long - term tax rate of 27% as provided in LTP Case • Capital Structure: Norse’s current debt / total capitalization ratio (1) ILLUSTRATIVE WEIGHTED AVERAGE COST OF CAPITAL ANALYSIS Sources: Company filings, Capital IQ as of unaffected date of March 18, 2024 and current market date of December 20, 2024 for Risk Free Rate Note: 1. Reflects $2,689MM of debt as of fiscal Q3 2024 per Norse Management and market value of Norse equity as of unaffected date of March 18, 2024 19 Morgan Stanley
PRELIMINARY & CONFIDENTIAL APPENDIX B CENTERVIEW SUPPORTING VALUATION ANALYSIS 20
PRELIMINARY & CONFIDENTIAL 21 3.7x 3.9x 3.3% 3.2% (16.3%) (8.8%) (4.7%) 5.2x 5.1x 6,370 1,647 (51.7%) 14.17 Kohl's 2.6x 2.7x 3.9% 3.9% (15.9%) (9.7%) (3.2%) 4.6x 4.5x Peer Median (0.6x) 0.6x 9.1% 10.9% (19.6%) (19.2%) (2.2%) 8.8x 7.1x 6,320 6,908 (8.7%) $434.34 Memo: Dillard's 2.0x 2.3x 3.8% 3.7% 0.2% 0.9% 1.6% 5.4x 5.4x 6,303 4,291 (1.5%) $24.53 Current (5) Norse (Cons.) 2.0x 2.3x 4.4% 3.7% 9.0% 5.2% 1.9% 4.9x 5.5x 6,303 4,291 (1.5%) $24.53 Norse (LTP Case) Unaffected (6) 2.0x 2.3x 3.6% 3.5% (2.5%) (1.2%) 0.8% 4.6x 4.7x 5,202 2,891 (26.8%) $17.06 Norse (Cons.) 2.0x 2.3x 4.4% 3.9% 8.5% 5.4% 1.6% 4.1x 4.4x 5,202 2,891 (26.8%) $17.06 Norse (LTP Case) AV / Adj. EBITDA (1) '23A - '25E CAGR EBIT Margin (3) Net Leverage (4) Gross Leverage (4) 2025E 2024E EBIT (2) Total Revenues EBITDA (1,2) 2025E 2024E Aggregate Value Market Cap % of 52 - Wk. High Share Price Company 1.4x 1.6x 4.5% 4.5% (15.4%) (10.7%) (1.8%) 3.9x 3.8x $7,201 $4,649 (24.6%) $16.24 Macy's NORSE COMPARABLE COMPANIES ANALYSIS Source: Norse management, LTP Case, company filings, FactSet and Capital IQ as of December 20, 2024. Note: Dollars in millions except per share figures. Reflects fiscal years. (1) Norse EBITDA figures add back amortization of developer reimbursement. (2) EBIT and EBITDA reflect adjusted figures. (3) EBIT margin shown as % of total revenue. (4) Debt figures do not include operating leases, but include finance leases and LTM EBITDA does not add back rent. (5) Norse Current figures pro forma for $280mm of cash received in Q4’24 in connection with the amended program agreement with TD. (6) Reflects Norse share price, capitalization, consensus estimates and Management projections as of unaffected date of March 18, 2024. November 2023 LTP Case reviewed by the Board. Selected Department Store Peers Centerview
PRELIMINARY & CONFIDENTIAL 22 DISCOUNTED CASH FLOW ANALYSIS Assumes LTP Case Source: LTP Case, Norse management and Wall Street research. Note: Dollars in millions, except per share amounts and where otherwise noted. Share prices rounded to nearest $0.10. Assumes valuation date and balance sheet information as of November 2, 2024. Reflects fiscal periods. Reflects debt of $2,689mm and cash of $397mm as of Q3’24 per Norse management. Fully diluted shares outstanding include basic shares of ~165.0mm as well as full accelerated vesting of dilutive equity securities including options, PSUs and RSUs as of December 20, 2024 per Norse management. (1) (2) (3) (4) LTP Case. Represents normalized depreciation & net working capital. Change in net working capital reflects midpoint of perpetuity growth rate range. EBITDA unburdened by amortization of developer reimbursements. Reflects sum of Right - of - Use Asset Amortization and Change in Lease Liabilities. Unlevered Free Cash Flow Detail Perpetuity Growth Rate Method Centerview Projection Period (1) Terminal (2) 2028E 2027E 2026E 2025E Q4'24 $16,525 $16,525 $15,910 $15,319 $14,792 $3,967 Net Sales $1,521 $1,521 $1,406 $1,340 $1,276 $367 EBITDA (3) (469) (532) (530) (571) (602) (145) ( - ) Total D&A (284) (267) (236) (208) (182) (61) ( - ) Taxes $768 $722 $639 $561 $492 $162 NOPAT 469 497 493 531 552 131 (+) D&A, Net – 35 37 40 50 14 (+) Developer Reimbursement Amort. (86) (86) (83) (81) (80) (20) ( - ) Cash Lease Expense Adj. (4) (15) (28) (49) (51) (104) 371 ( - /+) Δ in NWC (469) (469) (452) (435) (430) (179) ( - ) Capex $667 $671 $584 $566 $481 $479 Unlevered FCF Implied Share Price Implied Terminal LTM EBITDA Multiple Perpetuity Growth Rate 1.5% 2.0% 2.5% $27.60 $29.10 $30.80 $24.00 $25.20 $26.50 Perpetuity Growth Rate 1.5% 2.0% 2.5% 5.0x 5.2x 5.5x 4.5x 4.7x 5.0x WACC 11.00% 12.00% 13.00% $21.00 $21.90 $23.00 4.1x 4.3x 4.5x
PRELIMINARY & CONFIDENTIAL 23 ILLUSTRATIVE WACC ANALYSIS Source: Company filings, Kroll, Bloomberg and FactSet as of December 20, 2024, except where otherwise noted. Note: U.S. dollars in millions. (1) Represents two - year weekly beta (based on local index) per Bloomberg. (2) Calculated as (Levered Beta / (1 + ((1 - Tax Rate) * Debt / Equity)). (3) Figures exclude finance leases. (4) Reflects Norse figures as of September 3, 2024. (5) Reflects Norse figures as of March 18, 2024. (6) Reflects current U.S. 20 - year treasury note yield. (7) Reflects Macy’s unlevered beta. (8) Reflects Macy’s debt / equity. (9) Reflects the levering of Macy’s unlevered beta at Macy’s debt / equity ratio. Levered Beta = (Unlevered Beta) * (1 + (1 - Tax Rate) * (Debt / Equity)). (10) Reflects U.S. Long - Horizon Equity Risk Premium per Kroll. (11) Reflects size premium per Kroll Valuation Handbook. (12) Calculated as Risk - Free Rate + (Historical Risk Premium * Levered Beta) + Size Premium. (13) Assumes illustrative cost of debt based on trading yields on bonds for Norse and selected peers. (14) Reflects Norse management long - term tax rate. (15) WACC equals ((Debt/Capitalization) * After - Tax Cost of Debt) + (Equity/Capitalization * Levered Cost of Equity)). Centerview WACC Analysis Beta Levered (1) Unlevered (2) Market Cap. Debt / Equity Company Debt (3) 62% 2,890 4,649 0.94 1.38 Macy's 139% 2,284 1,647 0.57 1.18 Kohl's 63% $2,689 $4,291 0.98 1.43 Norse - Current 68% $2,689 $3,983 1.26 1.88 Norse - Price Disclosure (4) 102% $2,939 $2,891 1.11 1.94 Norse - Unaffected (5) 13.2% 12.9% 12.6% 12.2% 11.9% 11.6% 13.0% 12.7% 12.4% 12.0% 11.7% 11.4% 12.8% 12.5% 12.2% 11.9% 11.6% 11.3% 12.7% 12.4% 12.1% 11.8% 11.5% 11.2% 7.75% Pre - Tax Cost of Debt (13) WACC Sensitivity Analysis (Peer - Based) (15) 27.0% Tax Rate (14) Unlevered Beta Debt / Debt / 4.79% Risk - Free Rate (6) 0.94 Unlevered Beta (7) 62% Debt / Equity (8) 1.36 Levered Beta (9) 7.17% Historical Risk Premium (10) 0.95% (11) 5.7% After - Tax Cost of Debt 1.15 1.10 1.05 1.00 0.95 0.90 Equity Cap. 11.7% WACC (15) 50% 75% 33% 43% 38.3% D / (D+E) 100% 50% 61.7% E / (D+E) 125% 56% Peer - Based WACC Size Premium Cost of Equity (12) 15.5%
PRELIMINARY & CONFIDENTIAL 24 0.50 0.60 0.80 0.70 0.90 1.00 1.10 1.20 1.30 1.40 1.50 Dec - 22 Mar - 23 Jun - 23 Sep - 23 Dec - 23 Mar - 24 Jun - 24 Sep - 24 Dec - 24 BETAS OVER TIME Source: Bloomberg as of December 20, 2024. Note: Represents two - year weekly beta based on the local index. (1) Reflects Norse unlevered beta as of March 18, 2024. (2) Reflects Norse unlevered beta as of September 3, 2024. Rolling Two - Year Weekly Unlevered Beta – Last Two Years 0.98 0.94 0.57 Norse Macy’s Kohl’s 1.26 Pre - Price Disclosure (2) 2Y Avg: 1.16 2Y Avg: 0.96 2Y Avg: 1.18 1.11 Unaffected (1) Centerview
PRELIMINARY & CONFIDENTIAL 25 SELECTED DEPARTMENT STORE BOND YIELDS Source: FactSet as of December 20, 2024. Note: Dollars in millions. Reflects bonds with greater than $100mm principal balance outstanding for Norse and peers. (1) Represents ICE BofA US High Yield (BB) index and ICE BofA US Issuers High Yield Retail index, respectively. Current US High Yield (BB) index yield of 6.40% and US High Yield Retail index yield of 7.39% (1) Amt. Maturity Issue YTW Out. Date Date 6.11% $350 03/2027 03/2017 6.09% $300 03/2028 03/1998 6.46% $500 04/2030 11/2019 6.57% $425 08/2031 07/2021 7.72% $149 01/2038 12/2007 7.51% $966 01/2044 06/2014 Amt. Maturity Issue YTW Out. Date Date 6.55% $326 04/2029 03/2021 6.85% $425 03/2030 03/2022 7.19% $425 03/2032 03/2022 8.78% $181 07/2034 07/2020 6.76% $367 12/2034 11/2014 7.89% $193 03/2037 03/2007 7.80% $250 01/2042 01/2012 7.28% $250 02/2043 11/2012 YTW Amt. Out. Maturity Issue Date 6.21% $353 07/2025 07/2015 8.96% $500 05/2031 03/2021 10.77% $112 01/2033 11/2002 10.60% $101 12/2037 09/2007 9.54% $427 07/2045 07/2015 Norse Macy's Kohl's Centerview
PRELIMINARY & CONFIDENTIAL 26 PRECEDENT INDUSTRY TRANSACTIONS Selected U.S. Department Store Transactions Source: Company filings, FactSet and Wall Street research. Note: Dollars in billions. (1) Based on Wall Street broker estimates for CY 2024. AV / LTM EBITDA AV / LTM Revenue Aggregate Value Acquiror Announcement Date Target 6.3x 0.68x $2.8 Sycamore Partners Aug - 15 Belk 9.1x 1.31x 6.1 CPPIB & Ares Sep - 13 Neiman Marcus 10.9x 0.91x 2.9 HBC Jul - 13 Saks 9.1x 0.91x 2.9 Median 8.8x 0.97x 3.9 Average Memo - Unconsumated Transactions Jul - 24 Neiman Marcus HBC Jun - 24 Macy's Arkhouse & Brigade $2.7 ~0.6x ~8.6x 9.2 0.39x 4.2x Macy’s Board unanimously determined that the proposal remains non - actionable and fails to provide compelling value to Macy’s shareholders Transaction remains contingent on additional financing (1) (1) (Proposal Date) Centerview
PRELIMINARY & CONFIDENTIAL Disclosed Valuation Details Date Price Target Rating Firm Name Discounted Cash Flow 12/5/2024 $38.50 Buy Morningstar 12.3x 2026E EPS 11/27/2024 $26.00 Hold Telsey ~11.0x FY2025E EPS 12/19/2024 $25.00 Hold Gordon Haskett ~5x FY2024E AV / EBITDA 11/26/2024 $25.00 Hold Citi FY25 EPS of $2.05 and 12x P/E. 11/27/2024 $25.00 Hold TD Cowen 4.75x 2Y Forward EV/EBITDA 11/26/2024 $24.00 Hold Goldman Sachs 11.5x FY2025 P/E 11/27/2024 $23.00 Hold Jefferies 11.0x NTM P/E Based on CY2026 EPS 11/26/2024 $23.00 Hold Barclays 22.5x AV/EBITDA FY2025E 11/27/2024 $22.00 Sell Bank of America 10.0x 2026 EPS 11/26/2024 $22.00 Hold Evercore ~10.0x FY2025 EPS 11/29/2024 $22.00 Hold BMO ~4.3x 2026E EBITDA 11/26/2024 $21.00 Sell JP Morgan ~0.3x 2026E AV / Sales 11/27/2024 $14.50 Sell UBS NA 11/27/2024 NA Hold Guggenheim NA 12/9/2024 NA Hold William Blair 12.2x 2025E P/E & 6.8x 2025E AV / EBITDA 12/2/2024 NA Hold KeyBanc NA 11/27/2024 NA NA Morgan Stanley $23.00 Median (1) $22.65 Mean (1) $19.79 (2) $20.09 (2) ANALYST PRICE TARGETS 27 Excluded Brokers with Revised Price Targets Based on Transaction - Related News Centerview Analyst price targets above unaffected Norse share price of $17.06 and below current share price of $24.53 Source: Wall Street Equity Research, Market Data as of December 20, 2024. (1) Morningstar, KeyBanc, Barclays and Morgan Stanley price targets excluded from median and mean calculations.
PRELIMINARY & CONFIDENTIAL 28 +20% +21% +33% +41% 10th Percentile 25th Percentile Median 75th Percentile PREMIUMS PAID VS. UNAFFECTED FOR U.S. RETAIL TARGETS Source: Company filings and FactSet. Note: Unaffected date represents date before leak or rumor of potential transaction. Share Price Premiums vs. Unaffected Share Price Centerview ▪ Reflects transactions for public U.S. - based retail operators in the last 10 years ▪ TEV greater than $1bn ▪ Excludes food retail, internet retail, drug store & convenience and branded apparel store - operators ▪ Excludes out of bankruptcy court auctions Reflects 7 transactions in last 10 years Bid group proposal of $24.25 relative to Norse unaffected price (3/18/2024): +42%
PRELIMINARY & CONFIDENTIAL 29 2.0x 2.5x 3.0x 3.5x 4.5x 5.5x 6.0x Dec - 22 4.1x 4.0x Mar - 23 Jun - 23 Sep - 23 Dec - 23 Mar - 24 Jun - 24 Sep - 24 Dec - 24 MULTIPLES OVER TIME Source: Company filings, FactSet as of December 20, 2024. 3.5x 5.1x 5.0x 5.7x +38.0% 3.9x +9.8% 5.2x +2.7% Norse Macy’s Kohl’s AV / NTM EBITDA Multiples – Last Two Years July 4, 2024: HBC / Neiman announced Median Peer NTM Multiple: 4.7x Dec. 8, 2023: Leak of buyout bid from Arkhouse Management & Brigade Capital of $21 per share Median Peer NTM Multiple: 4.9x March 19, 2024: Leak of Norse take - private Median Peer NTM Multiple: 4.9x Centerview
PRELIMINARY & CONFIDENTIAL 30 $0 $5 $10 $20 $16.49 $15 $25 $30 $35 Dec - 22 Mar - 23 Jun - 23 Sep - 23 Dec - 23 Mar - 24 Jun - 24 Sep - 24 Dec - 24 TWO - YEAR SHARE PRICE PERFORMANCE Source: FactSet as of December 20, 2024. Share Price Performance – Last Two Years +55.2% $24.53 +48.8% (18.9%) (41.1%) Norse Macy’s Kohl’s S&P 500 March 19, 2024: Leak of Norse take - private 1 - Day Share Price Reaction: +13.6% September 4, 2024: Norse 13 - D filed; formation of Bid Group and price disclosure 1 - Day Share Price Reaction: (0.2%) February 11, 2024: Special Committee formed May 3, 2024: Sycamore named in Norse take - private leak June 19, 2024: Process letter shared with E&P Centerview
PRELIMINARY & CONFIDENTIAL APPENDIX C INVESTOR PERSPECTIVES ON NORSE'S VALUATION MULTIPLE 31
PRELIMINARY & CONFIDENTIAL 32 Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 33.5% (50.8%) (19.8%) (24.3%) 33.4% 3.0% L1Y ∆ 47.9% (43.1%) (19.4%) (36.4%) 48.8% (36.5%) L2Y ∆ 36.8% (69.8%) (31.1%) 51.0% 22.0% (59.9%) L3Y ∆ 29.4% (72.0%) 0.2% (45.1%) (39.7%) (61.4%) L5Y ∆ 0 50 100 150 200 Dec - 19 Jun - 20 Dec - 20 Jun - 21 Dec - 21 Jun - 22 Dec - 22 Jun - 23 Dec - 23 (39.7%) (72.0%) +0.2% SECTOR SHARE PRICE PERFORMANCE OVER TIME Source: Capital IQ as of December 20, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of December 20, 2024 3. Represents Macy’s as of unaffected date of December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL Share Price Performance Over Time Indexed to 100; Since December 20, 2019 250 (3) Macy's Unaffected Norse Unaffected (1) (4) Post Norse Unaffected Period To Current (2) May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; Share Price increased +5.1% day after earnings January 22, 2024: Macy’s announces it will not enter into an agreement with Arkhouse and Brigade March 18, 2024: Norse unaffected share price of $17.06 Jun - 24 Dec - 24 July 3, 2024: Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal December 8, 2023: Macy’s unaffected share price of $17.39 August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; Share Price increased +4.2% day after earnings July 15, 2024 Macy’s terminates discussions with Arkhouse and Brigade November 26, 2024: Norse reports Q3 FY2024 earnings aftermarket; Shares fall (1.1%) on the day
PRELIMINARY & CONFIDENTIAL 33 SECTOR VALUATION MULTIPLES OVER TIME Source: Capital IQ as of December 20, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of December 20, 2024; for Norse Current Today, reflects $2,689MM of debt as of fiscal Q3 2024 and $397MM of cash as of fiscal Q3 2024 per Norse Management 3. Represents Macy’s as of unaffected date of December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL AV / NTM EBITDA Over Time Since December 20, 2019 Post Norse Unaffected Period To Current December 8, 2023: Macy’s unaffected multiple of 3.7x November 17, 2022: Kohl’s announces they will not engage in transformative transactions; multiple of 5.6x January 21, 2022: Kohl’s unaffected multiple of 4.0x January 24, 2022: News of takeover offer; Kohl’s affected multiple of 5.1x May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; multiple of 5.1x March 18, 2024: Norse unaffected multiple of 4.7x August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; multiple of 5.5x Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal (4) Kohl's Off - Price Retail Macy's Current Macy's Unaffected (3) (12/8/2023) (2) Norse Current Norse Unaffected (1) (3/18/2024) 16.1x 5.2x 3.9x 3.7x 5.7x 4.7x Today 15.3x 5.2x 3.6x 3.1x 5.2x 4.4x L1Y Avg. 14.6x 5.2x 3.3x 3.2x 5.2x 4.4x L2Y Avg. 13.8x 5.0x 3.3x 3.8x 5.0x 5.0x L3Y Avg. 14.7x 5.0x 4.4x 4.5x 5.2x 5.2x L5Y Avg. November 26, 2024: Norse reports Q3 FY2024 earnings aftermarket; multiple of 5.4x 2.0x 0.0x 4.0x 8.0x 10.0x 12.0x Dec - 19 Jun - 20 Dec - 20 Jun - 21 Dec - 21 Jun - 22 Dec - 22 Jun - 23 Dec - 23 Jun - 24 Dec - 24 July 3, 2024: 5.7x 5.2x 3.9x 6.0x 5.6x 5.1x 4.4x
PRELIMINARY & CONFIDENTIAL 34 $17.06 $18.66 $18.74 $19.98 $21.03 $21.14 $22.78 $24.62 – 10.0 15.0 20.0 10 15 20 25 30 35 3/15 4/29 5/13 5/28 6/11 6/26 7/11 7/25 8/8 8/22 9/6 9/20 10/4 10/18 11/1 +43.8% $24.53 (23.5%) 5.0 (43.4%) NORSE’S SHARE PRICE SINCE UNAFFECTED DATE Source: Capital IQ Note: 1. Market data as December 20, 2024 11/15 12/2 12/16 Norse Volume (MM) Share Price Performance and Trading Volume Over Time (1) Since March 18, 2024 Share Price ($) May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket. Beats on consensus revenue estimates, misses on EPS, and reaffirms guidance Average Volume: 2.6MM Norse Macy’s Kohl’s March 19, 2024: Reuters report of Norse’s potential take - private Volume (MM) 3/18 4/1 4/15 March 18, 2024: Unaffected date May 2, 2024: Rumors of Sycamore Partners’ participation on potential take - private transaction September 4, 2024: Offer Disclosure August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket. In - line with consensus revenue estimates and beats on consensus EBIT and EPS estimates. Raised low - ends of all guidance ranges November 26, 2024: Norse reports Q3 FY2024 earnings aftermarket. Beats on consensus revenue, EBIT and EPS estimates. Raised low - ends of revenue and comparable sales growth guidance ranges April 18, 2024: Erik and Pete Nordstrom file Schedule 13D; Announce formation of Special Committee
PRELIMINARY & CONFIDENTIAL 35 LEGAL DISCLAIMER – MORGAN STANLEY We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. 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PRELIMINARY & CONFIDENTIAL 36 LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by the Special Committee of the Board of Directors of Norse ("the Special Committee") and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company and approved for our use by the Special Committee. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at the direction of the Special Committee Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit 16(c)(iv)
PROJECT NORSE BOARD UPDATE FEBRUARY 4, 2024 Preliminary & Confidential Draft
Preliminary & Confidential Draft EXECUTIVE SUMMARY 2 ▪ The Board previously requested management evaluate potential alternatives to enhance shareholder value, including exploratory discussions with potential equity investors ▪ Following the last Board discussion, Morgan Stanley and Centerview reached out to 20 potential investors to explore interest in a potential transaction, of which six indicated interest in meeting with the Company under NDA ▪ Starting on January 17 th , the Company engaged in management meetings with potential investors: , Liverpool, and – Meetings consisted of ~2 hour in - person business overview presentations with Company management, including Erik, Pete, Cathy and Ken, and store visits where time permitted – Since these initial meetings, follow - up financial calls with management were held with and upon their request; has also submitted a follow - up request list ▪ If the Board desires to continue to explore a potential transaction, initial conversations might be had with certain significant shareholders to evaluate the conditions required for their support of a transaction and advisors might check in with the potential investors to confirm interest levels
E Note: 1. Management conducted a preview meefing with 3 Preliminary & Confidential Orafi: 20 Initial Outreach 7 LLiver I NDA Signed 6 Remainin Parties km Liver/seal Management Presentation 3 Strategic Partner Sovereign Wealth Fund / Family Office Financial Sponsor Follow - up Requests Received
E Note: 1. Management conducted a preview meefing with 4 Preliminary & Confidential Orafi: LfiLive p:ol 1/30/24 1/18/24 1/7/24 2/2/24 1/8/24 1/29/24 1/8/24 1/17/24 1/9/24 1/26/24 1/17/24 Inbound 10/31/23 11/1/23 10/31/23 1/25/24 11/26/23 Potentially Interested Potentially Interested Potentially Interested Passed Potentially Interested Passed Passed Passed Potentially Interested
Passed 11/3/23 Passed 12/7/23 Passed 11/3/23 Passed 10/15/23 Passed 12/8/23 Passed 10/15/23 Passed 10/31/23 Passed 12/13/23 Passed 12/7/23 Passed 12/7/23 Passed 10/15/23 5 Preliminary & Confidential Orafi:
SUMMARY OF POTENTIAL INVESTOR FEEDBACK Potential Referendums Key Highlights Differentiated assortment through unique access to select powerhouse and emerging brands Strong profitability of Norse Banner’s digital platform Attractive unit economics for new Rack locations Meaningful supply chain improvement led by the West Coast Omni Center Warehouse Experienced executive leadership team with demonstrated ability to attract talent Recent investments in technology and omni - channel capabilities are generating strong results Uncertainty about how the industry landscape will evolve Long - term potential to accelerate growth at Norse banner Performance of generational investments (Canada closure and NYC location) Path to increasing the profitability of Rack’s digital platform Trajectory of EBIT Margins back to historical levels Ongoing capital expenditure requirements for maintenance of stores and technology Ability to invest in a heritage brand with a strong reputation Potential of Rack store penetration 6 Preliminary & Confidential Draft
ILLUSTRATIVE NEXT STEPS / PROCESS FOR DISCUSSION PURPOSES 7 Preliminary & Confidential Draft Subject to Board approval: ▪ Assess what governance and other conditions would be required for significant shareholders to support a transaction ▪ Check in with potential counter - parties to confirm interest levels (without soliciting formal bids) ▪ Send process letter to interested parties
APPENDIX SUPPLEMENTARY MATERIALS 8
Share Price Performance Over Time ! 1 ! Indexed to 1DD; Since Jan 31, 2021 300 200 100 0 Jan - 21 Jul - 21 Jan - 22 Jul - 22 Jan - 23 +26.0% Jan - 24 Since November Board Meeting Norse 28.7% Off•Price Retail 14.2’› i i i L1Y A (9.1%) L3Y A (48.8%) i Sourœ: Capital IQ Notes: 1. Market data as of 1/31/2024 2. Market data as of 11/8/2023 3. Represents median of Burlington, TJX and Ross 4. Represents median of Abercrombie & Fitch, Amedcan Eagle OutfJtters, Carter's, Gap, Guess, Levi Strauss, The Children's Place, Urban Outfitters and Victoda's Secret Prefiminory & Con/identio/ Droit 9
AV / NTM EBITDA Over Time ( 1 ! Since Jan 31, 2D21 10.0x 8.0X 5.0x 0.0x Jan - 21 Today L1Y Avg. L2Y Avg. L3Y Avg. Jul - 21 ! Norse i 4.5x ! [ 4.6x 5.1x Jan - 22 i i 4.6x , i , i , i Jul - 22 Jan - 23 Source: Capital IQ Notes: 1. I Market data as of 1/31/2024 2. Represents median of Burlington, TJX and Ross 3. Represents median of Abercrombie & Fitch, American Eagle OutfJtters. Carter's. Gap, Guess. Levi Strauss, The Children's Place, Urban Out1ilters and Victoria's Secret Preliminary & Con/identio/ Jul - 23 Off - P rice Retail ' 5.2x 13. 8x 3.2x 13. 8x Jan - 24 1D
STRATEGIC ALTERNATIVES PREVIOUSLY DISCUSSED Continue to Execute LTP – Execute Baseline LTP and consistently beat Street estimates Dividend Enhancement – Payout excess year - end cash as a dividend each year Enhanced Buyback – Use excess cash flow to establish robust buyback program Monetize Real Estate – Execute sale leaseback transactions of the Company’s owned real estate portfolio and distribute proceeds to shareholders 1 2 3 4 11 Preliminary & Confidential Draft
STRATEGIC ALTERNATIVES PREVIOUSLY DISCUSSED Separate Rack – Separate Full - Line and Rack into two distinct businesses with separate management teams and shareholders 5 6 Increase Liverpool Stake via Tender Offer – Liverpool increases its stake via a Tender Offer PIPE or Take - Private with Investments by Liverpool and New Long - term Investor(s) 7 – Increase in ownership by Liverpool and additional strategic investors through PIPE or take - private, potentially with roll of Nordstrom family ownership 8 Full Sale to Private Equity or Strategic – Sell the business to a strategic acquiror or financial sponsor 12 Preliminary & Confidential Draft
ü urgent: ate.1s vs. c urrent sJ s.ss Illustrative Share Price Statistic: 13 Preliminary & Con/identio/ 109» † 30 - Day VWAP 6O - Day • VWAP . • 90 - Day VWAP 996 10% 2196 27% 4596 25% 32% 5096 57% Source: Capital IO Notes: 1. Interest of family and Liverpool rollover to be assessed dui1ng process 2. Fully diluted shares inclusive of 162.3MM basic shares outstanding and 4.6I 4I 4 untested RSUs 3. Net debt inclusive of 52,861 I 4I 4 in debt and S700I 4I 4 in cash and eguivalents Equity Value 3,030 3,339 3,506 3,673 3,839 Aggregate Value 5,19 1 5,500 5,667 5,834 6,000 Illustrative Family Rollover 880 970 1,018 1,067 Illustrative Liverpool Rollover 347 Market Equity 2,054 2,156 2,259 2,362 2,464 2,567
19.6 % 1, 00 0 Illustrative Share Price 14 Preliminary & Confidential Drofi: $18.15 $20.00 $21.00 $22.00 $23.00 $24.00 $25.00 10•4 16 ƒ 4 21•4 32W Premium / (Discount) to: 30 - Day • VWAP . 60 - Day VWAP • 90 - Day ■ VWAP ( 1%) . 10% ■ 14% Ŷ • 9% • 21% • 25% 15% † 27% † 32% 20% † 33% † 25% . 39% a 44% 31% ■ 45% • 50% 36% j 51% j 57% Scenario 1: Take - Private Without any Rollover Scenario 2: Scenario 3: Rollover of Family !’! Family Rollover and Liverpool Rollover and Liverpool with Increase in Stake to Match Equity Check 3,030 3,339 3,506 3,673 3,839 4,006 4,173 Eguity Check Additional Anchor Investment Eguity Check Scenario 4 - : Family Rollover and Liverpool Rollover with G1Bn Additional Investment !'! Additional Anchor Investment Eguity Check 1,864 2,156 2,259 2,362 2,464 2,567 Source: Capital IQ Notes: 1. Illustrative family rollover based on aggregate beeficial ownership reported for Bruce Nordstrom, Anne Gittin r, Erik Nordstrom, Pete Nordstrom, and James Nordstrom 6b5 687 720 753 786 818 1,270 1,399 1,469 1,539 1,609 1,679 1,749 1,000 1,000 1,000 1,000 1,000 1,000 1,000 864 1,156 1,259 1,362 1,464 1,567
LEVERAGE - BACKED TRANSACTION COULD TRIGGER CHANGE OF CONTROL PUT IN INDENTURES Change of Control Put Requires Repurchase of Notes and Expected to Be Difficult in Current Market Below Investment Grade Rating event occurs when: 1. The Notes are rated below Investment Grade by each of the Rating Agencies 2. The Notes are lowered in rating specifically in connection with a change of control • The downgrade must occur within 60 days post change of ownership Definition • We believe that a change in ownership from public to private (assuming no change in the capital structure) should not lead to a downgrade in ratings • That said, the Agencies’ decisions are subject to their perception of how aggressive they expect the new equity holder to be Conclusion • Norse should engage in a Ratings Evaluation Service (RES) / Ratings Assessment Service (RAS) to receive Rating Agencies’ preliminary views on ratings in conjunction with the contemplated transaction Next Steps A Change of Control occurs: • At the consummation of any transaction or series of transactions so that a person or group other than the Company or its subsidiaries owns more than 50% of the outstanding Voting Stock of the Company Definition Norse must be wary of the following aspects of the Change of Control definition: 1. The transition to a “person” or “group” owning over 50% of the Voting Stock can occur over a series of transactions, rather than just one 2. The term “group” means the investor does not have to be an individual purchaser Conclusion • A take private would likely be deemed to be a Change of Control under the indentures Next Steps 1 Change of Control 2 Below Investment Grade Rating Event 15 Preliminary & Confidential Draft Note: The Company’s 2028 debentures do not have a change of control trigger
Fundraising Overview 16 Preliminary & Confidential Orafi: Primary Contact(s) Firm Overview Select Current and Realized Consumer Investments
Fundraising Overview 17 Preliminary & Confidential Orafi: Primary Contact(s) Firm Overview Select Current and Realized Consumer Investments
Fundraising Overview 18 Preliminary & Confidential Orafi: Primary Contact(s) Firm Overview Select Current and Realized Consumer Investments
Source: Company Materials, Capital IQ Notes: 1. Capital IQ as of January 17, 2024 2. Mexican Pesos converted to USD at conversion rate of 0.0579 3. Free Cash Flow calculated as Cas P h r F e l o l w i m f r o m i n O a p r e y r at i & on s C l e o s s n C f a i p d e x entia l Draft 788 Net Debt 179 Unfunded Pension & OPEB 80 16 Minorities, Pref. & Other 60 9,595 Aggregate Value 2024E 2023E LTM Multiples 40 4.8x 5.0x 5.6x AV / EBITDA 20 0.4x 0.4x 0.5x Net Leverage Jan - 24 Jan - 23 Jul - 23 Jan - 22 Jul - 22 Jul - 21 Jan - 21 0.8x 0.9x 1.0x Total Leverage Liverpool Mexican IPC Index Summary Valuation 180 $6.42 Share Price $5.07 / $6.91 52 Wk Low / High +59.6% 160 1,342 TSO 140 8,612 Market Cap. 1,650 Total Debt +19.2% 120 (862) Less: Cash 100 Financial Summary (1)(2) $MM, FYE December 31st Actual Consensus CAGR 2019A 2020A 2021A 2022A 2023E 19A - '23E Total Store Count Net Leverage 0.8x 1.2x 0.1x 0.2x Business Description • Liverpool is an omnichannel retail group based in Mexico; it operates through its Retail, Financial Services and Real Estate segments – Retail: ~90% of revenue (of which ~23% comes from digital sales) – – • O B – • L G • L – – 331 314 315 308 Financial Services: ~8% of revenue with 6.7MM+ credit card holders 5.4% (0.3%) 2.3% 4.8% Real Estate: ~2% of revenue % Growth perates various retail brands including Liverpool (124), Suburbia (179), outiques (112), and Galerías shopping centers (28) Revenue 8,388 6,728 8,743 10,208 11,347 7.8% 16.8% 11.2% 29.9% (19.8%) 6.9% Liverpool offers technology, clothing, home and cosmetics and % Growth 10.1% 3,784 4,448 3,119 2,065 3,024 Suburbia specializes in family clothing at accessible prices Gross Profit icensing agreements with U.S. retail concepts including the WSM and % Margin 36.0% 30.7% 35.7% 37.1% 39.2% AP family of brands iverpool Investor Day 2023 Highlights & Investments Adj. EBITDA 1,307 579 1,334 1,738 1,924 10.1% 17.0% 17.0% 15.3% 8.6% 15.6% Emphasized omni - channel as a key focus, with ~35% of volumes % Margin 30.3% 10.7% 130.2% (55.7%) 10.6% fulfilled via click - connect and plans to convert existing distribution % Growth 626 1,167 609 543 centers to an omni - channel model Free Cash Flow 36.0% 87.5% 105.0% 41.5% Expanding a ~250 sq - m 'Express' format, with 20 openings planned (3) for 2023, while a remodel program is in - focus for the Suburbia banner % FCF Conv. – Announced an agreement to operate the dealership network in Mexico for China - based electric vehicle maker BYD L3YR Share Price Performance (1) %, Indexed to 100 Aggregate Value Build - Up (1)(2) $MM, unless otherwise noted 19 LIVERPOOL Recent News • Liverpool reported robust 3Q2023 earnings with strong revenue and EBITDA growth – Real Estate and Financial business segments continued to post double - digit revenue growth – Consolidated revenues grew almost 10% and EBITDA for the quarter grew 13% with a margin improvement of 50 basis points Primary Contact(s) • Graciano Guichard Gonzalez, CEO • Enrique Guijosa Hidalgo, CFO
Fundraising Overview Primary Contact(s) Firm Overview Select Current and Realized Consumer Investments Preliminary & Confidential Orafi: 20
PASSED COUNTERPARTY OVERVIEW Counterparty Primary Contact Outreach Date Commentary • 11/3/2023 • Declined NDA; Prefers to co - invest in private equity - like deals • 12/7/2023 • Declined NDA; Not currently taking calls on new investments • 10/31/2023 • Declined extended management presentation after introductory Zoom call • Investment opportunity does not fit their medium - term plans • 11/3/2023 • Declined NDA • 10/15/2023 • Declined NDA; High bar for Retail and not the right fit • 11/1/2023 • Declined NDA • 10/31/2023 • Declined NDA • 12/8/2023 • Declined NDA 21 Preliminary & Confidential Draft
PASSED COUNTERPARTY OVERVIEW • Declined NDA; High bar for Retail and not the right fit • 10/15/2023 • Declined NDA; Prefers to underwrite more of a transformation and looking for higher risk - adjusted return • 10/31/2023 • Declined further discussion post management presentation • 1/19/2024 • Declined NDA • 12/13/2023 • Declined NDA; Not the right focus area and prefers high - end luxury or otherwise • 12/7/2023 • Declined NDA • 12/7/2023 • Declined NDA due to discomfort with language; Team to offer a Zoom call based on public information • 10/15/2023 22 Preliminary & Confidential Draft Counterparty Primary Contact Outreach Date Commentary
© Morgan Stanley and/or certain of its affiliates. All rights reserved. 23 Preliminary & Confidential Draft We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. We have prepared this document and the analyses contained in it based, in part, on certain assumptions and information obtained by us from the recipient, its directors, officers, employees, agents, affiliates and/or from other sources. Our use of such assumptions and information does not imply that we have independently verified or necessarily agree with any of such assumptions or information, and we have assumed and relied upon the accuracy and completeness of such assumptions and information for purposes of this document. Neither we nor any of our affiliates, or our or their respective officers, employees or agents, make any representation or warranty, express or implied, in relation to the accuracy or completeness of the information contained in this document or any oral information provided in connection herewith, or any data it generates and accept no responsibility, obligation or liability (whether direct or indirect, in contract, tort or otherwise) in relation to any of such information. We and our affiliates and our and their respective officers, employees and agents expressly disclaim any and all liability which may be based on this document and any errors therein or omissions therefrom. Neither we nor any of our affiliates, or our or their respective officers, employees or agents, make any representation or warranty, express or implied, that any transaction has been or may be effected on the terms or in the manner stated in this document, or as to the achievement or reasonableness of future projections, management targets, estimates, prospects or returns, if any. Any views or terms contained herein are preliminary only, and are based on financial, economic, market and other conditions prevailing as of the date of this document and are therefore subject to change. We undertake no obligation or responsibility to update any of the information contained in this document. Past performance does not guarantee or predict future performance. 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Notwithstanding anything herein to the contrary, each recipient hereof (and their employees, representatives, and other agents) may disclose to any and all persons, without limitation of any kind from the commencement of discussions, the U.S. federal and state income tax treatment and tax structure of the proposed transaction and all materials of any kind (including opinions or other tax analyses) that are provided relating to the tax treatment and tax structure. For this purpose, "tax structure" is limited to facts relevant to the U.S. federal and state income tax treatment of the proposed transaction and does not include information relating to the identity of the parties, their affiliates, agents or advisors. This document is provided by Morgan Stanley & Co. LLC and/or certain of its affiliates or other applicable entities, which may include Morgan Stanley Realty Incorporated, Morgan Stanley Senior Funding, Inc., Morgan Stanley Bank, N.A., Morgan Stanley & Co. International plc, Morgan Stanley Securities Limited, Morgan Stanley Bank AG, Morgan Stanley MUFG Securities Co., Ltd., Mitsubishi UFJ Morgan Stanley Securities Co., Ltd., Morgan Stanley Asia Limited, Morgan Stanley Australia Securities Limited, Morgan Stanley Australia Limited, Morgan Stanley Asia (Singapore) Pte., Morgan Stanley Services Limited, Morgan Stanley & Co. International plc Seoul Branch and/or Morgan Stanley Canada Limited Unless governing law permits otherwise, you must contact an authorized Morgan Stanley entity in your jurisdiction regarding this document or any of the information contained herein. LEGAL DISCLAIMER – MORGAN STANLEY
LEGAL DISCLAIMER – CENTERVIEW 24 Preliminary & Confidential Draft This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit
16(c)(v)
PROJECT NORSE BOARD UPDATE FEBRUARY 27, 2024 Preliminary & Confidential Draft
▪ Following the last Board discussion on February 4 th , the financial advisors to the Special Committee have continued to engage with the remaining interested financial sponsor parties. 3 parties remain: , and ▪ Each party is reflecting on how best to structure a potential equity investment given the constraint of keeping the current debt capital structure intact - including the threshold issue of not incurring a ratings downgrade upon announcement of a transaction EXECUTIVE SUMMARY 2 Preliminary & Confidential Draft
20 7 6 4 Initial Outreach NDA Signed Management Presentation Follow - up Requests Received OUTREACH SUMMARY Strategic Partner Sovereign Wealth Fund / Family Office Financial Sponsor (1) Remaining Financial Sponsors (3) Remaining Strategic Partner (1) Note: 1. Management conducted a preview meeting with 12/13/23 on Zoom 3 Preliminary & Confidential Draft
OUTREACH SUMMARY Follow Up Status Session Date Management Meeting Date NDA Signed Counterparty Outreach Date 1/30/24 Potentially Interested 1/18/24 ᴣ 1/7/24 2/9/24 Passed 2/2/24 ᴣ 1/8/24 Potentially Interested 1/29/24 ᴣ 1/8/24 Financial Sponsors Passed 1/17/24 ᴣ 1/9/24 5 1/26/24 Potentially Interested 1/17/24 ᴣ Inbound Passed ᴣ 10/31/23 Passed 11/1/23 Strategic Passed 10/31/23 Partners 4 Potentially Interested 1/25/24 ᴣ 11/26/23 Note: 1. Management conducted a preview meeting with 12/13/23 on Zoom 4 Preliminary & Confidential Draft
Counterparty Outreach Date NDA Signed Management Meeting Date Follow Up Session Date Status 11/3/23 Passed 12/7/23 Passed 11/3/23 Passed 10/15/23 Passed 12/8/23 Passed 10/15/23 Passed 10/31/23 Passed 12/13/23 Passed 12/7/23 Passed 12/7/23 Passed 10/15/23 Passed OUTREACH SUMMARY Sovereign Wealth Funds / Family Offices 11 5 Preliminary & Confidential Draft
SUMMARY OF POTENTIAL INVESTOR FEEDBACK Potential Referendums Uncertainty about how the industry landscape will evolve Long - term potential to accelerate growth at Norse banner Performance of generational investments (Canada closure and NYC location) Path to increasing the profitability of Rack’s digital platform Trajectory of EBIT Margins back to historical levels Ongoing capital expenditure requirements for maintenance of stores and technology Potential of Rack store penetration Ability to hit return hurdles for potential investment Key Highlights Differentiated assortment through unique access to select powerhouse and emerging brands Strong profitability of Norse Banner’s digital platform Attractive unit economics for new Rack locations Meaningful supply chain improvement led by the West Coast Omni Center Warehouse Experienced executive leadership team with demonstrated ability to attract talent Recent investments in technology and omni - channel capabilities are generating strong results Ability to invest in a heritage brand with a strong reputation Promising shift in anchor brand strategy 6 Preliminary & Confidential Draft
Premium / (Discount) to: 7 Preliminary & Confidential Draft Market Equity (1) Illustrative Liverpool Rollover (1) Illustrative Family Rollover Aggregate Value Equity Value 90 - Day VWAP 60 - Day VWAP 30 - Day VWAP Statistic: Illustrative Share Price 61.5% 9.4% 29.0% $2,161MM Net Debt (3) (2) 167MM FDSO $16.48 $17.73 $18.73 vs. Current Current: $20.32 2,087 320 985 5,553 3,392 23% 15% 8% -- % $20.32 2,156 331 1,018 5,667 3,506 27% 18% 12% 3% $21.00 2,259 347 1,067 5,834 3,673 34% 24% 17% 8% $22.00 2,362 362 1,115 6,000 3,839 40% 30% 23% 13% $23.00 2,464 378 1,164 6,167 4,006 46% 35% 28% 18% $24.00 2,567 394 1,212 6,334 4,173 52% 41% 33% 23% $25.00 2,670 410 1,261 6,501 4,340 58% 47% 39% 28% $26.00 ILLUSTRATIVE EQUITY CHECK SENSITIVITY As of February 22, 2024 Source: Capital IQ Notes: 1. Interest of family and Liverpool rollover to be assessed during process 2. Fully diluted shares inclusive of 162.3MM basic shares outstanding and 4.6MM unvested RSUs 3. Net debt inclusive of $2,861MM in debt and $700MM in cash and equivalents
Premium / (Discount) to: 8 Preliminary & Confidential Draft Scenario 1: Take - Private Without any Rollover Equity Check Additional Anchor Investment Equity Check Additional Anchor Investment Equity Check Equity Check 90 - Day VWAP 60 - Day VWAP 30 - Day VWAP Statistic: Illustrative Share Price 1,000 19.6% $16.48 $17.73 $18.73 vs. Current Current: $20.32 1,087 1,000 1,421 665 2,087 3,392 23% 15% 8% -- % $20.32 1,156 1,000 1,469 687 2,156 3,506 27% 18% 12% 3% $21.00 1,259 1,000 1,539 720 2,259 3,673 34% 24% 17% 8% $22.00 1,362 1,000 1,609 753 2,362 3,839 40% 30% 23% 13% $23.00 1,464 1,000 1,679 786 2,464 4,006 46% 35% 28% 18% $24.00 1,567 1,000 1,749 818 2,567 4,173 52% 41% 33% 23% $25.00 1,670 1,000 1,819 851 2,670 4,340 58% 47% 39% 28% $26.00 Scenario 2: Scenario 3: Rollover of Family (1) Family Rollover and Liverpool Rollover and Liverpool with Increase in Stake to Match Family (1) Scenario 4: Family Rollover and Liverpool Rollover with $1Bn Additional Investment (1) ILLUSTRATIVE EQUITY CHECK SENSITIVITY As of February 22, 2024 Source: Capital IQ Notes: 1. Illustrative family rollover based on aggregate beneficial ownership reported for Bruce Nordstrom, Anne Gittinger, Erik Nordstrom, Pete Nordstrom, and James Nordstrom
NORSE’S SHARE PRICE HAS TRAILED PEERS IN THE LAST THREE YEARS 0 9 Preliminary & Confidential Draft 100 200 Share Price Performance Over Time (1) Indexed to 100; Since Feb 22, 2021 300 Feb - 21 Aug - 21 Feb - 22 Aug - 22 Feb - 23 Aug - 23 Feb - 24 +25.1% +20.9% (11.8%) (45.7%) (51.1%) Source: Capital IQ Notes: 1. Market data as of 2/22/2024 2. Market data as of 11/8/2023 3. Represents median of Burlington, TJX and Ross 4. Represents median of Abercrombie & Fitch, American Eagle Outfitters, Carter’s, Gap, Guess, Levi Strauss, The Children’s Place, Urban Outfitters and Victoria’s Secret (3) (4) Kohl's Macy's Off - Price Retail Specialty Retail Norse 16.3% 12.7% 65.7% 14.7% 44.1% (2) Since November Board Meeting 16.6% 27.9% (7.8%) (7.2%) 2.8% L1Y ∆ (11.8%) 20.9% 25.1% (51.1%) (45.7%) L3Y ∆
APPENDIX 10 SUPPLEMENTARY MATERIALS
LEVERAGE - BACKED TRANSACTION COULD TRIGGER CHANGE OF CONTROL PUT IN INDENTURES Change of Control Put Requires Repurchase of Notes and Expected to Be Difficult in Current Market Below Investment Grade Rating event occurs when: 1. The Notes are rated below Investment Grade by each of the Rating Agencies 2. The Notes are lowered in rating specifically in connection with a change of control • The downgrade must occur within 60 days post change of ownership Definition • We believe that a change in ownership from public to private (assuming no change in the capital structure) should not lead to a downgrade in ratings • That said, the Agencies’ decisions are subject to their perception of how aggressive they expect the new equity holder to be Conclusion • Norse should engage in a Ratings Evaluation Service (RES) / Ratings Assessment Service (RAS) to receive Rating Agencies’ preliminary views on ratings in conjunction with the contemplated transaction Next Steps A Change of Control occurs: • At the consummation of any transaction or series of transactions so that a person or group other than the Company or its subsidiaries owns more than 50% of the outstanding Voting Stock of the Company Definition Norse must be wary of the following aspects of the Change of Control definition: 1. The transition to a “person” or “group” owning over 50% of the Voting Stock can occur over a series of transactions, rather than just one 2. The term “group” means the investor does not have to be an individual purchaser Conclusion • A take private would likely be deemed to be a Change of Control under the indentures Next Steps 1 Change of Control 2 Below Investment Grade Rating Event 11 Preliminary & Confidential Draft Note: The Company’s 2028 debentures do not have a change of control trigger
Firm Overview Select Current and Realized Consumer Investments Fundraising Overview • Primary Contact(s) 12 Preliminary & Confidential Draft
Firm Overview 13 Select Current and Realized Consumer Investments Fundraising Overview Primary Contact(s) Preliminary & Confidential Draft
60 40 20 220 200 180 160 Feb - 21 Aug - 21 Feb - 22 Aug - 22 Feb - 23 Aug - 23 Feb - 24 Mexican IPC Index Liverpool Financial Summary (1)(2) $MM, FYE December 31st Actual Consensus CAGR 2019A 2020A 2021A 2022A 2023E 19A - '23E Total Store Count Net Leverage 0.8x 1.3x 0.1x 0.2x 331 314 315 308 Financial Services: ~8% of revenue with 6.7MM+ credit card holders 5.4% (0.3%) 2.3% 4.8% Real Estate: ~2% of revenue % Growth perates various retail brands including Liverpool (124), Suburbia (179), outiques (112), and Galerías shopping centers (28) Revenue 8,446 6,775 8,803 10,278 11,426 7.8% 11.2% 16.8% 29.9% (19.8%) 6.9% Liverpool offers technology, clothing, home and cosmetics and % Growth 9.9% 4,442 3,810 3,141 2,079 3,044 Suburbia specializes in family clothing at accessible prices Gross Profit icensing agreements with U.S. retail concepts including the WSM and % Margin 36.0% 30.7% 35.7% 37.1% 38.9% AP family of brands iverpool Investor Day 2023 Highlights & Investments Adj. EBITDA 1,318 579 1,344 1,750 1,956 10.4% 17.1% 17.0% 15.3% 8.5% 15.6% Emphasized omni - channel as a key focus, with ~35% of volumes % Margin 11.8% 30.3% 132.2% (56.1%) 10.7% fulfilled via click - connect and plans to convert existing distribution % Growth 630 1,175 613 546 centers to an omni - channel model Free Cash Flow 36.0% 87.4% 105.9% 41.4% Expanding a ~250 sq - m 'Express' format, with 20 openings planned (3) for 2023, while a remodel program is in - focus for the Suburbia banner % FCF Conv. $MM, unless otherwise noted Summary Valuation $7.29 Share Price $5.10 / $7.41 52 Wk Low / High +95.1% 1,342 TSO 9,790 Market Cap. 1,661 Total Debt 140 (868) Less: Cash +27.1% 120 793 Net Debt 100 180 Unfunded Pension & OPEB 80 16 Minorities, Pref. & Other 10,779 Aggregate Value 2024E 2023E LTM Multiples 5.3x 5.5x 6.3x AV / EBITDA Net Leverage 0.5x 0.4x 0.4x Total Leverage 1.0x 0.8x 0.8x Business Description • Liverpool is an omnichannel retail group based in Mexico; it operates through its Retail, Financial Services and Real Estate segments – Retail: ~90% of revenue (of which ~23% comes from digital sales) – – • O B – • L G • L – – – Announced an agreement to operate the dealership network in Mexico for China - based electric vehicle maker BYD L3YR Share Price Performance (1) %, Indexed to 100 Aggregate Value Build - Up (1)(2) Notes: 1. Capital IQ as of February 22, 2024 2. Mexican Pesos converted to USD at conversion rate of 0.05831 3. Free Cash Flow calculated as Cash Flow from Operations less Capex 14 LIVERPOOL Source: Company Materials, Capital IQ Preliminary & Confidential Draft Recent News • Liverpool reported robust 3Q2023 earnings with strong revenue and EBITDA growth – Real Estate and Financial business segments continued to post double - digit revenue growth – Consolidated revenues grew almost 10% and EBITDA for the quarter grew 13% with a margin improvement of 50 basis points Primary Contact(s) • Graciano Guichard Gonzalez, CEO • Enrique Guijosa Hidalgo, CFO
Firm Overview Select Current and Realized Consumer Investments Fundraising Overview Primary Contact(s) 15 Preliminary & Confidential Draft
PASSED COUNTERPARTY OVERVIEW • Declined NDA; Prefers to co - invest in private equity - like deals • 11/3/2023 • Declined NDA; Not currently taking calls on new investments • 12/7/2023 • Declined extended management presentation after introductory Zoom call • Investment opportunity does not fit their medium - term plans • 10/31/2023 • Withdrew from process; Would like to see longer period of stability and ultimately not ready to join a process right away • 1/8/2024 • Declined NDA • 11/3/2023 • Declined NDA; High bar for Retail and not the right fit • 10/15/2023 • Declined NDA • 11/1/2023 • Declined NDA • 10/31/2023 16 Preliminary & Confidential Draft Counterparty Primary Contact Outreach Date Commentary
PASSED COUNTERPARTY OVERVIEW Counterparty Primary Contact Outreach Date Commentary • 12/8/2023 • Declined NDA • 10/15/2023 • Declined NDA; High bar for Retail and not the right fit • 10/31/2023 • Declined NDA; Prefers to underwrite more of a transformation and looking for higher risk - adjusted return • 1/19/2024 • Declined further discussion post management presentation • 12/13/2023 • Declined NDA • 12/7/2023 • Declined NDA; Not the right focus area and prefers high - end luxury or otherwise • 12/7/2023 • Declined NDA • 10/15/2023 • Declined NDA due to discomfort with language 17 Preliminary & Confidential Draft
© Morgan Stanley and/or certain of its affiliates. All rights reserved. 18 Preliminary & Confidential Draft We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. We have prepared this document and the analyses contained in it based, in part, on certain assumptions and information obtained by us from the recipient, its directors, officers, employees, agents, affiliates and/or from other sources. Our use of such assumptions and information does not imply that we have independently verified or necessarily agree with any of such assumptions or information, and we have assumed and relied upon the accuracy and completeness of such assumptions and information for purposes of this document. 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Notwithstanding anything herein to the contrary, each recipient hereof (and their employees, representatives, and other agents) may disclose to any and all persons, without limitation of any kind from the commencement of discussions, the U.S. federal and state income tax treatment and tax structure of the proposed transaction and all materials of any kind (including opinions or other tax analyses) that are provided relating to the tax treatment and tax structure. For this purpose, "tax structure" is limited to facts relevant to the U.S. federal and state income tax treatment of the proposed transaction and does not include information relating to the identity of the parties, their affiliates, agents or advisors. This document is provided by Morgan Stanley & Co. LLC and/or certain of its affiliates or other applicable entities, which may include Morgan Stanley Realty Incorporated, Morgan Stanley Senior Funding, Inc., Morgan Stanley Bank, N.A., Morgan Stanley & Co. International plc, Morgan Stanley Securities Limited, Morgan Stanley Bank AG, Morgan Stanley MUFG Securities Co., Ltd., Mitsubishi UFJ Morgan Stanley Securities Co., Ltd., Morgan Stanley Asia Limited, Morgan Stanley Australia Securities Limited, Morgan Stanley Australia Limited, Morgan Stanley Asia (Singapore) Pte., Morgan Stanley Services Limited, Morgan Stanley & Co. International plc Seoul Branch and/or Morgan Stanley Canada Limited Unless governing law permits otherwise, you must contact an authorized Morgan Stanley entity in your jurisdiction regarding this document or any of the information contained herein. LEGAL DISCLAIMER – MORGAN STANLEY
LEGAL DISCLAIMER – CENTERVIEW 19 Preliminary & Confidential Draft This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit
16(c)(vi)
PROJECT NORSE UPDATE MARCH 30, 2024
BACKGROUND TO PROJECT NORSE • Throughout 2023 , at the request of the Norse Board of Directors, management worked with Morgan Stanley and Centerview Partners to independently evaluate value creation potential across a number of different scenarios • Analyzed Norse's standalone long - term plan (“LTP"), benchmarking relative to historical performance, industry trends and consensus expectations, alongside assessment of potential multiple evolution for Norse given the industry backdrop • In addition, Morgan Stanley and Centerview Partners considered a range of potential organic and inorganic strategic actions that could enhance value for all shareholders, including: — Enhancement of current dividend and shareholder buyback policies — Reduction of capital expenditure to support additional capital returns — Monetization of real estate — Partial tender offer by third party — Separation of Rack via sale, spin - oh or split - off — Scale merger — Take - private transaction • Assessed the shareholder value creation potential, actionability / execution risk and other key considerations relative to executing against the standalone LTP 2
PROCESS UPDATE • Special Committee of the Board of Directors was formed on February 11 , 2023 to oversee the process to explore a potential take - private transaction and has met twice weekly with its independent advisors, Morgan Stanley, Centerview Partners and Sidley • Since November, Morgan Stanley and Centerview Partners have engaged in discussions with 22 strategic and financial parties to gauge interest in exploring a transaction — Separately, Moelis reached out to additional parties to understand any potential further interest • Following these discussions there has been engagement under NDA with 7 parties through management presentations, diligence calls and store walks • Process letters soliciting non - binding bids were sent to 3 potential investors who had expressed interest in exploring a transaction following management presentations , and ) — In addition, discussions are ongoing with discussion necessary to determine interest), (management presentation on March 19, further (internally evaluating interest) and Liverpool • At the conclusion of our round 1 deadline (March 22’ d ) for non - bindinq bids: — — submitted a written proposal to acquire the company for a share price range of $21.00 to $22.00 (implied 23% - 29% premium to unaffected share price( 1 )), with a number of unstated assumptions and caveats verbally indicated interest in supporting the financing of a transaction via a structure which includes a sale leaseback and issuing preferred equity Notes: 1. Unaffected share priœ as of March 18, 2024 3
22 Initial Outreach / Inbounds 8 NDA Signed Note: 1. Management conducted a preview meeting with 12/13/23 on Zoom 2. Indicates party was not part of process when pre inn nary indication process letter was distributed 7 Strategic Partner Sovereign Wealth Fund / Family Office Financial Sponsor Remaininq Strategic Partner (1) iLLiverpocl Remainin Financial S onsors Verbal Indication for Financing Sale Leaseback + Perpetual Preferred Investment with 13 ƒ /+ coupon 1 Management Presentation Follow - up Requests Received Indication of Interest Received 4
Offer Price per Share Transaction Structure and Fi nanc ing Sources Due Diligence Foe us & Timing Adviso rs Other Other indications $21 - $22 per share AV: $5.8 - $6.0Bn 23% - 29 ƒ f» premium to unaffected share price ! 1 5.3x — 5.5x AV / 2023A EBITDA • All cash • Acquisition of all outstanding common stock shares of the Company, and would be interested in exploring a partnership with key existing shareholders • Predicated on satisfactory agreements with potential partners including relevant protections and preferences • Intention to structure investment such that the Company can meet its long - term capital structure goals, including maintaining its existing debt facilities post - transaction • No specific timing; “prepared to complete our work quickly and efficiently” • Completion of business due diligence, including meeting with company management • Confirmatory accounting and legal due diligence • Negotiation of definitive transaction agreements • Have not indicated any advisors engaged at this stage • Senior members of the firm have reviewed and are supportive of the proposal Note: 1. Unaffected share price as of March 18, 2024 Verbal indication ol'interest to support financing ol' transaction Illustrative $2Bn Sale Leaseback + Perpetual Preferred Investment with 13 ƒ /« coupon • $2Bn cash proceeds used to de - lever to <$1Bn (retain 2044 5% notes) • Perpetual preferred funded behind debt capital ($1 - $1.3Bn) • 13% Coupon • 3% Penny Warrants • Cash flow sweep (details TBD) • Minimum multiple/return hurdle on invested capital (to be discussed) 5
STRUCTURING CONSIDERATIONS SUMMARY • Norse's Senior Notes totaling $2.5Bn (all debt with exception of Debentures due 2028) contain “double trigger’ change of control put option for bondholders, comprising of: 1. Change of control and 2. Subsequent downgrade to the bond rating by all 3 agencies of these bonds specifically pursuant to the change of control transaction • Therefore, the ratings assessment concurrent with the transaction announcement will be critical to the Company's ability to roll over its current capital structure • The Rating Agencies will carefully analyze the terms of new cash equity to support the Transaction and it is important that this new cash equity receive “full equity treatment’ • The advisors expect that the rating agencies will assess each of The structure and governance associated with the new ownership arrangement Go - forward financial policy The pro forma financial metrics (i.e., expected credit ratios) 6
Growth: W2D8E FY2027E FY2D25E FY2024E FY2023A FY2D22A FY2019A 8.9/ 8.8 ƒ /‹ 8,5 ƒ /‹ 8.1% Margin: FY2D28E FY2027E FY2026E FY2D25E FY2024E FY2023A FY2D22A FY2019A 5.0 % 4.9 % 4.8% 4. 4% 4.0 % Margin: Consensus Management Long - Term Plan vs. Management Long - Term Plan Consensus Historical 15,524 FY2019A 1,455 7B4 Actual Performance 15,530 FY2DZ2A 1,1D6 502 14,693 FY2023A 1,153 567 LTP Extrapolation Assuming Consistent Strategy and Execution LTP Reviewed with the Board in November 2023 ,625 FY2024E (0.5%) 1,105 1,186 507 580 15,127 889 FY2D25E 3, 4% +1d9â +25% 533 668 15 15, FY2026E 3.2 ƒ /‹ +219 1,358 ,122 541 755 16,094 1,416 795 Source: Capital IO as of I March 27.2024; I Management Long - Term Plan as of March 28.2024 for years FY24 - 26. extrapolations thereafter per management guidance Note: 1. Adds back all depreciation and amortization. including amortization of developer reimbursements 16,577 FY2D28E 3,0 ƒ /‹ 1,475 835 FY’24E — FY26E CAGR 7
IIIustrative Future Share Price Trajectory (LTP and Consensus Estimates) $50 $45 $40 $38.72 $35 $30 $25 $20 $15 $10 $5 Mar - 21 Mar - 22 Present Value o/'Fufore Share Price*’ LTP Consensus Mar - 23 LTP (3 - year) at 4.5x NTM EBITDA LTP (3 - year) at range of 4. 0x — 5. 0x NTM EBITDA Consensus at 4.5x NTM EBITDA Consensus at range of 4.0x — 5. 0x NTM EBITDA Historical share price Unaffected Price: $17.06 Mar - 24 Mar - 25 $19 $15 Source. Norse management, company filings, FactSet and Capital IQ as of March 27, 2024. Note. Future share prices represent future value and do not include value of dividends. Consensus free cash flaw extrapolated based on LTP free cash flow conversion rate. (1) Assumes peer - based cost of equity of 16.696. Mar - 26 $20 $15 8
Public Trading C omparables Discounte d C ash Flow Analysis Metfiodb/ogy Assumption 52 - Wk High: 08/01/23 52 - Wk Low: 11/13/23 High: 03/06/24 Low: 03/07/24 Premium to Unaffected: 25% - 40% 4.0x - 5.0x '24E EBITDA of $1,186mm WACC: 10.5% - 13.0% PGR: 1.5% - 2.5% /mp/iecf Share Price V'a/ue $13.10 $12.00 $14.35 $13.00 $23.30 $24.00 $21.30 $23.90 $21.35 $23.20 /mp/iecfEV/ 74E EB/7OA /mp/ied EV $4,526 $6,257 3.8x 5.3x $4,342 $6,376 3.7x 5.4x $5,923 $6,356 5.0x 5.4x $4,743 $5,929 4.0x 5.0x $4,512 $6,240 3.8x 5.3x Source. Norse management, Company filings and FactSet as of March 27, 2024. Note. Implied share prices rounded to the nearest $0.05. Illustrative DCF valuation date of February 3, 2024. Assumes mid - year discounting. Public Trading Comps reflect LTP financials. EBITDA is unburdened by amortization of developer reimbursements. (1) High reflects KeyBanc; Low reflects UBS. 9
Methodolo Rounded to the nearest $D.25 Public Trading Comparables 1 * 5,524 3,867 $9.25 1,105 Consensus. AV / FY2024E EBITDA. 3.5x - 5.0x 5,929 4,150 $10.75 1,186 Management LTP Case. AV / FY2D24E EBITDA. 3.5x - 5.Dx Discounted Equity Value * 2 ) 5,402 4,131 $18.?!5 j $10.75 1,122 Consensus. 3.5x - 5 Dx FY2D26 EBITDA 6,079 4,597 $19.50 1,358 Management LTP Case. 3.5x - 5.Dx FY2026 EBITDA Metric ($MM) Discounted Cash Flow 3 * Management LTP Case. 3.5x - 5 Dx Exit Multiple; 8.4% - 9.49’» WACC Reference Only 52 - Week Trading Range Analyst Price Targets (Undiscounted) ( 4 ! Analyst Price Targets (Discounted) 4 * Leveraged Buyout "’ Management LTP Case. 17.5% - 22.59’+ Target IRR; Exit Multiple = Entry $0 $19.00 $12.00 $10.50 lied Share Price $16.00 $16.75 $26.00 $29.50 $24.00 $21.00 $’19.75 $20 $10 $30 Source: Capital IO (unaffected date of I March 18, 2024, current as of I March 27, 2024); Management Long - Term Plan as of March 28, 2024 for years FY24 - 26, extrapolation thereafter Notes: 1. Range based on NTM trading multiples of Macy's (3.7x) and Kohl's (4.8x), as of unaffected date of I March 18.2024 2. Represents present value of implied year - end 2025E share price based on discounted eguity value analysis; share prices and cumulative dividends discounted at 14.1‘l6 cost of equity; sensitized on +0.75x / (0.75x) exit multiple 3. Implied share price based on DCF multiples method; WACC of 8.9%; EBITDA exit multiple of4.25x sensitized on +0.75x / (0.75x) 4. Represents present value of median of analyst price targets as of March 27, 2024: discounted analyst price targets discounted at 14.1‘l6 cost of equity 5. Represents implied entry price to generate 17.5 - 22.596 IRR based on I Management Long - Term Plan 5,D20 6,291 4,52 6,376 4,V2 5,868 4,D88 5,147 High 6,715 5,656 10
$4,236 $4,067 $3,898 $3,728 $3,559 $3,389 $3,220 $3,376 Equity Value 65 63 62 60 58 56 55 56 Plus: Transaction Fees( 3 ! $4,301 $4,130 $3,959 $3,788 $3,617 $3,446 $3,274 $3,432 Total Required Equity Investment Illustrative Structure Assumin Certain Existin e Shareholders Roll. $1,212 $1,164 $1,115 $1,067 $1,018 $970 $921 $966 Norse Family Rolled Equity( 4 394 378 362 347 331 315 299 314 Liverpool Rolled Equity( 4 ƒ 2,695 2,588 2,481 2,374 2,268 2,161 2,054 2,152 Incremental Equity Required 5.5x 5.3x 5.2x 5.0x 4.9x 4.8x 4.6x 4.8x $1,186 EV / 2024E EBITDA 5 5.1x 4.9x 4.8x 4.7x 4.5x 4.4x 4.3x 4.4x $1,281 EV / 2025E EBITDA 5 ! f69.5 169.5 169.5 169.5 169.5 169.5 169.5 169.5 Diluted Shares Outstanding $4,236 $4,067 $3,898 $3,728 $3,559 $3,389 $3,220 $3,376 Equity Value 2,257 2,257 2,257 2,257 2,257 2,257 2,257 2,257 Plus: Net Debt at Close (H1'24)( 1 ƒ $6,494 $6,324 $6,155 $5,985 $5,816 $5,646 $5,477 $5,633 Enterprise Value $25.00 $24.00 $23.00 $22.00 $21.00 $20.00 $19.00 $19.92 Metric +4/ o +41% +35% +29% +2Ü@o +17% 11 o 17% $17.06 vs. Unaffected (3/18f24) +31% +26% +21 o +15% +10% 5% (0%) +4% $19.08 vs. 30 - Oay VWAP tito +2 o +22 o +17% +12% 6@o 1 o 6 o $18.80 vs. 60 - Day VWAP Prem ium (Discount) Implied Multiple s Current Illustrative Purchase Priœ Source. Norse management, company filings and FactSet as of March 27, 2024. Note. Dollars in millions, except where otherwise noted. Financials based on management's Long - Term Plan (LTP). (1) Illustrative net debt at close reflects H1 '24 debt of $2,687 and H1 '24 cash of $430. (2) Assumes no additional debt raised in (3) Assumes illustrative tmnsaction fees of 1.0"é of TEV. (4) Illustratively assumes investors roll equity stake in full. (5) EBITDA unburdened by amoitization of developer reimbursements. 11
APPENDIX A MORGAN STANLEY SUPPORTING VALUATION ANALYSIS 12
CY2025E P / E (x) CY2024E P / E (x) CY2025E Av / CY2024E Av / EBITDA (x) *!‘! CY2024E EBITDA Margin {'/ ) CY2024E EBIT I 1argin (%) CY'23A — CY'25E EBITDA CAGR CY'23A — CY'25E Revenue CAGR Norse Current Consensus i i Norse Current hfanagement Norse U naffected Consensus 4 * U naffected (5) D.79’» 1.5% D.89’» 0.69’» 0.6% 1.5% (2.19’») (1.29’») (0.99’») (4.7%) 5.4% 5.4% 3.5% 4.09’» 3.59’» 4.09’» 4.0% 4.79’» Source: Capital IO as of I March 27.2024; I Management Long - Term Plan as of I March 28.2024 Notes: 1. Norse figures adds back all depreciation and amortization, including amortization of developer reimbursements 2. Norse FDSD and net debt as of 04 2023A; inclusive of S2,937MM in debt and S628I 4I 4 in cash and equivalents 3. Base - line Long - Term Plan multiples assumes current / unaffected date AV and share price 4. Represents Norse as of unaffected date of I March 18, 2024 5. Represents I lacy’s as of unaffected date of December 8.2023 7.5% 8.19’» 7.5% 8.19’» 8.59’» 8.6% 5.1x 4.8x 4.7x 4.4x 5.4x 3.9x 5.1x 4.4x 4.6x 4.1x 5.3x 3.9x 11.1x 10.3x 9.4x 8.8x 6.3x 12.1x 10.1x ! i 8.8x i 8.6x 7.5x I 6.3x 11 Dx 13
Forward P/E trading multiple 3/6/2024 $24.00 Buy KeyBanc 11.0x FY2025 P / E 3/25/2024 $22.00 Held TD Cowen - 10.0x FY2024 EPS 3/5/2024 $20.00 Held BMO - 5.0x FY2024 AV / EBITDA 3/6/2024 $20.00 Held Citi - 7.8x 2025E EPS 3/6/2024 $19.00 Held Telsey NA 3/5/2024 $18.00 Held Goldman Sachs Forward P / E trading multiple 3/14/2024 $17.00 Held Jefleries 9.0x FY2025 EPS 3/6/2024 $17.00 Held Evercore Forward P / E trading multiple 3/22/2024 $17.00 Held Gordon Haskett 4.0x FY2024 AV / EBITDA 3/6/2024 $15.00 Sell Bank of America 4.0x FY2024 AV / EBITDA 3/6/2024 $15.00 Sell JP Morgan 7.0x NTM P / E multiple based on CY2025 EPS 3/5/2024 $15.00 Sell Barclays 7.0x Forward P / E 3/6/2024 $13.00 Sell Morgan Stanley - 0 2x FY2026 AV / Sales 3/7/2024 $12.00 Sell UBS NA 3/6/2024 NA Held Guggenheim NA 3/6/2024 NA Held William Blair Present Value: 514.89 517.00 Median Present Value: 515.27 517.43 Mean Source: Wall Street Eguity Research, I Market Data as of I March 27.2024 Note: 1. PV share price discounted using 14.196 Cost of Equity 14
Future Share Price (Incl. Dividends) ! 1 ! $MM / Share Current 59 $11.69 2024E 3.50x NTM Adj. EBITDA $23.80 83 87 2D25E Present Value of Future Share Price (Incl. Dividends) ! 1 t ( 2 t $MM / Share Current 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x $18.82 53 $1D.24 2024E 5 DDx NTM Add. EBITDA $18.34 53 $10.72 2025E AV / NTM Adj. EBITDA of 5.00x 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 5.0x ,106 4.3x 4.3x 106 3.5x 3.5x 106 AV / NTM Adj. EBITDA Multiple (x) NTM Add EBITDA 5,612 5,528 4,770 4,699 3,928 3,870 Future Aggregate Value (1,820) (2,002) (1,820) (2,002) (1,820) (2,002) ( — ) Net Debt 3,791 3,527 2,950 2,697 2,108 1,868 Future Equity Value 169 169 169 169 169 169 FDSO ’ 1 ’ $22.37 $20.81 $17.41 $15.92 $12.44 $11.02 Future Share Price (SUSD) $23.80 $21.48 $18.83 $16.59 $13.87 $11.69 Future Share Price Incl. Dividends 2.00 1.00 2.00 1.00 2.00 1.00 Periods 0.77 0.88 0.77 0.88 0.77 0.88 Discount Factor 2 * $17.17 $18.23 $13.36 $13.95 59.66 Discounted Share Price (SUSD) $18.82 $14.53 $14.53 10.7 $10.24 Discounted Share Price I ncl. Dividends 6%) (21. 7"A) (18.3 ƒ A) (44.0"A) (46 (43.4 ƒ A) Premium (Discount) tO 30D VWAP ($19 03) Premium (Discount) tO Unaffected ($ 17. 06) 3 * (5.5%) (27.1"A) (27.1 ƒ A) (46.2% (48. 6 ƒ A) Premium (Discount) tO Current ($19.92) (^i Denotes range on FBF Notes: 1. Calculated as NTM EBITDA multiplied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by OWN FDSO of 169MM; inclusive of future value of cumulative dividends per share discounted to present value 2. Discounted to February 3, 2024 at 14.1% cost of equity 3. Martet data as of unaffected date of March 18, 2024; Current share price as of March 27, 2024 15
Future Share Price (Incl. Dividends) ! 1 $MM / Share Current 65 $13 D7 2024E 3.50x NTM Adj. EBITDA 15 $17.31 2D25E Present Value of Future Share Price (Incl. Dividends) ! 1 t (*I $MM / Share Current 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x $11.45 2024E 5.DDx NTM Adj. EBITDA 2025E AV / NTM Adj. EBITDA of 5.00x 1. Calculated as NTM EBITDA multiplied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by OWN FDSO of 169MM; inclusive of Nture value of cumulative dividends per share discounted to present value 2. Discounted to February 3, 2024 at 14.1% cost of equity 3. Martet data as of unaffected date of March 18, 2024; Current share price as of March 27, 2024 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 5.0x 4.3x 4.3x 3.5x 3.5x AV / HTM Adj. EBITDA Multiple ,358 358 358 (x) HTM Add EBITDA 6,406 5,445 Future Aggregate Value (2,153) (2,407) (2,153) (2,407) (2,153) (2,407) ( — ) Net Debt 4,639 4,000 3,620 3,039 2,601 2,078 Future Equity Value 172 172 172 526.60 523.24 520.76 517.66 514.92 512.07 Future Share Price (SUSD) 528.99 S24.24 523.15 518.65 517.31 513.07 Future Share Price Incl. Dividends 2.00 1.00 2.00 1.00 2.00 1.00 Periods 0.77 0.88 0.77 0.88 0.77 0.88 Discount Factor 2 * 520.42 520.36 515.93 515.47 511.45 510.58 Discounted Share Price (SUSD) 522.3 521.23 517.87 516.34 511.45 Discounted Share Price Incl. Dividends Premium / (Discount) tO 30D VWAP ($19 03) 19. 4P‹ (6.6%) (9.3P‹) (32. 9 ƒ A) (38. 0 ƒ A) Premium / (Discount) tO Unaffected ($ 17. 06) 3 * (10.3 ƒ A) (18. 0 ƒ A) (32.8 ƒ A) (42.5 ƒ A) Premium / (Discount) tO Current ($19.92) ^J DenDtes range Dn FBF Notes: 16
Implied Share Price 9.4% 5.00x 8.9% 8.4% 9.4% 4.25x 8.9% 8.4% 9.4% 8.9% 8.4% Terminal EBITDA Exit Multiple Discount Rate 1,729 1,751 1,773 1,729 1,751 1,773 1,729 1,751 1,773 Present Value of: Forecasted Free Cash Flow 715 935 008 100 195 300 376 455 Terminal Value 6,444 6,574 6,708 5,736 5,851 5,968 5,029 5,127 5,227 Implied Aggregate Value (2,309) (2,309) (2,309) (2,309) (2.309) (2.309) (2,309) (2,309) (2,309) f — ) Net Debt *” 4,135 4,265 4,399 3,542 2,720 2,918 169 169 169 169 169 Ful Diluted Shares Key Assumptions • February 3, 2024 • Financials presented on January ending fiscal year • 5 - year DCF using mid - year discounting convention • WACC range of 8.4% - 9.4% • Illustrative effective tax rate in years FY24E - FY28E of 27% • Terminal year assumptions: — D&A equal to terminal year CapEx — Increase in NWC calculated from a 2% revenue growth into perpetuity usted EBITDA % Margin ( - ) D&A Amort. Of Develo r Reimbursements (+) Right of Use Asset Amort. (+) (Increase) / Decrease in Lease Liabilities (+) (Increase) / Decrease in NWC '*' ( - ) CapEx Unlevered Free Cash Flow Unlevered Free Cash Flow Forecast ( 1 t $MM, unless otherwise noted FYE Februa 2024E 43% 48B 5296 19% 2396 2796 (6%) {396} 1B F'remium / (Dismuntl to Unaffected ' 6 ' 2296 2696 J096 2% 5% 8% (19%) (17%) (14%) % Premium / (Discount) to Current ’ 7 5.4x 55x 57x 4.8x 4.9x 5.hx 4.2x 4.3x 4.4x Implied AV/ 2€I24E EBITDA 5.hx 51x 52x 4.5x 4.6x 4.7x 39x 4.0x 4.1x Implied AV/ 2€I2SE EBITDA Notes: 1. Terminal LTM EBITDA assumes 3.096 terminal revenue growth; 8.9% terminal EBITDA margin 2. NWC for years 2027E - 2028E represent 596 of the change in revenue 3. Free Cash Flow Conversion represents Unlevered Free Cash Flow divided by Adjusted EBITDA 4. Net debt as of Q4 2023A; inclusive of $2.937MM of debt and S628MM of cash 5. Fully diluted shares as of 04 2023A; inclusive of 163.3MM basic shares outstanding and 6.2MM untested RSUs 6. Unaffected date as of March 18, 2024 7. Current market data as of March 27, 2024 8.1% (517) 197 (280) (204) (502) 240 8.5% (528) 85 198 (283) 42 (530) 529 2026E 8.7% (538) 65 202 (288) (21 ) f546) 501 202 (297) (21 ) f555) 530 16,577 16,094 15,611 15,127 14,625 Revenue valuation date 3.1% % Growth 1,475 8.996 (57 1 ) EBIT 5% % Margin (225) (215) (204) ( 180) ( 157) ( - ) Tax Expense 2Z96 2Z96 2Z96 2F96 2F96 571 554 538 528 517 (+) D&A 69 67 65 85 89 (+) Amort. Of Developer Reimbursements 202 (306) (21 ) f564) 561 Denotes range on FBF 17
3996 2,937 2.7x Debt Roll 500 05x Minimum Cash D96 35 00x Transaction Fees 100% 6.9X JOtaI Uses Total (' +) Amount ($) Multiple (x) Uses Total (%) Amount (S) Multiple (x) Sources Purchase Equity 394£ $2,937 Existing Debt $19. $19.31 $19.00 $18.68 $48.36 17.536 $19.10 $18.80 $18.50 $18.20 $17.90 1&836 $18.61 $18.32 $18.D3 $17.75 $17.46 $18.14 $17.87 $17.59 $17.32 $17.05 21.336 / $16 $16.92 $17.18 $17.44 $17.70 Key Assumptions • No additional leverage; rolling existing debt • Illustrative closing date of Q4 2023 • 5 - year hold • Assumes exit multiple equal to entry multiple • Exit January 31, 2029 (Year - end FY28E) • Entry Multiple based on NTM EBITDA of $1.2Bn ( 2 ! • NTM Exit EBITDA of $1.5Bn • Assumes Family and Liverpool roll current equity stakes $2,461 Sponsor Equity • Entry premium of 40% B') $628 Balance Sheet Cash ($23.88 / share) ( 1 ! 159L $1,117 Management Rollover • Min cash of $500MM $376 Liverpool Rollover • Effective tax rate of 27% Illustrative Sources and Uses $MM, unless otherwise noted Total Sources 6.9x C7,519 100% Entry Multiple / Target IRR Implied $ per Share / Premium to Unaffected Share Pñce 1 t A 20•/ R t f R t Source: CDI IQ as of March18, 2024; Maragement Long - Term Rn as of March 28, 2024 for years FY24 - 26, ex0apolab i thereafter 1. As of unaffected date of March 18, 2024 2. Net debt as of Q4 2D23A; inclusive ofS2,937MM of debt nd S628MM of cash Entry = Exit for 17.5 - 22.59t› IRR try Price (4.5x Entry Multiple) DenDtes range Dn FBF 18
High Low Base Notes Assumption 4.2% 4.2% 4.2% Spot Rate on 10 - Year U.S. Treasury as of 3/27/2024 Risk Free Rate (R f) 6.0% 6.0% 6.0% Morgan Stanley Estimated Market Risk Premium Market Risk Premium (MRP) 1.66 1.66 1.66 Predicted U.S. Local Beta per Barra P redicted Beta 1.0% (1.0%) +/ — 1.0% from Base Sensitivrry Adjustment 15.19L 13.19L 14.1 ƒ 4 Calculated Using the Capital Asset Pricing Model Cost of Equity (K E ) 5.0% 5.0% 5.0% Weighted Average Cost of Debt Pre - tax Cost of Debt (K D ) 27.0% 27.0% 27.0% Per Management Guidance Tax Rate (I) 3.7 ƒ 4 3.7 ƒ A 3.7 ƒ A Post - tax Cost of Debt (K D ) 50.4% 50.4% 50.4% Based on Current Capital Structure Debt / Total Capitalization 9.4 ƒ 4 KE “ E/(D+E) + KD “ (1 - t) ” D/(D+E) Weighted Average Cost O f Cap'tal (WACC) Key Assumptions • Cost of Equitv: Calculated using the Capital Asset Pricing Model • Risk Free Rate: Based on 10 - year U.S. Treasury as Of current market date of March 27, 2024 • Predicted Beta: Predicted U.S. Local Beta per Barra as of unaffected date of March 18, 2024 • Cost of Debt: Norse's current blended cost of debt • Tax Rate : Implied long - term tax rate of 27 % as provided in Management's LTP • Capital Structure: Norse's current debt / total capitalization ratio ( 1 Source: Company filings, Capital IQ as of unaffected date of March 18, 2024 Note: 1. Debt as of 04 2023A and maitet value of Norse equity as of unaffected date of March 18, 2024 WACC Calculation 19
APPENDIX B CENTERVIEW SUPPORTING VALUATION ANALYSIS 20
Implied Share Price Implied Terminal k TM EBITDA Multiple Proiection Period( 1 TerminaI’ 2 ’ 2028E 2027E 2026E 2025E 2024E 2023A $16,025 $16,025 $15,563 $15,099 $14,158 $14,219 Net Sales $1,416 $1,358 $1,281 $1,186 $1,153 EBITDA”’ (622) (605) (586) ( - ) Total D&A (246) (225) (215) (204) (180) (13) ( - ) Taxes $665 $610 $488 $424 $554 NOPAT 528 517 (+) D&A, Net 67 85 89 69 Amort. +) Dewloper Reimbursement (104) (95) (86) (88) ( - ) Cash Lease Expense Adj. (21) (21) (21) 42 (204) (169) ( - ) A in NWC (546) (530) (502) (569) ( - ) Capex 5546 $561 $530 501 529 5240 5314 Unleve red FCF 5.0x 4.7x 4.4x $23.20 $21.70 $20.40 4.3x 4.1x 3.9x $18.30 $17.20 $16.20 3.8x 3.7x 3.5x $14.50 $13.70 $13.00 Perpetuity Growth Rate Perperuify Growth Rate Source. Norse management and Wall Street research. Note: Dollars in millions, except per share amounts and where otherwise noted. Share pnces rounded to nearest $0.10. Assumes valuation date and balance sheet information as of February 3, 2024. Represents fiscals years ending January. (1) (2) (3) 2024E - 2026 reflects three - year LTP reviewed with the Board in November 2023. 2027E - 2028E reflects the LTP extrapolation assuming consistent strategy and execution. Represents normalized depreciation & net working capital. Change in net working capital reflects midpoint of perpetuity growth rate range. EBITDA unburdened by amortization of developer reimbursements. 21
Unlevered Beta Debt / Debt / 1.20 1.10 1.00 0.90 0.80 Equity Cap. 13.2% 12.5% 11.9% 11.2% 10.6% 50% 33% 12.9% 12.3% 11.7% 11.0% 10.4% 75% 43% 12.8% 12.1% 11.5% 10.9% 10.3% 100% 50% 12.6% 12.0% 11.4% 10.8% 10.2% 125% 56% 84.7% Debt / Equity* 5 ’ 1.56 Leered Beta( 6 * 7.17% Historical Rsk Premium( 7 ) 0.95% Size Premium* 8 ) 16.6% Cost of Equip" 7.25% Pre - Tax Cost of Debt( 1 0 ) 27.0% Tax Rate* 11 * 5.3% After - Tax Cost of Debt 11.4% WACC 12 ’ 45.9% D / (D+E) 54.1% E / (D+E) WACC Analysis WACC Se nsitivity Analysis (Peer - Based) 2 Pe er•Base d WACC Beta Market Debt / Equity Debt P• Unlevered! 2 ! Levered' 1 ’ Company 54% 3,023 5,616 1.22 1.74 Macy's 138% 4,503 3,264 0.71 1.48 Kohl's Norse 1.96 1.20 $3,376 $2,937 87% Source. Company filings, Kroll, Bloomberg and FactSet as of March 27, 2024. Note: U.S. dollars in millions. Macy's unaffected date reflects December 8. 2023. (1) Represents two - year weekly adjusted beta (based on local index) per Bloomberg. (2) Calculated as (Levered Beta / (1 + ((1 - Tax Rate) ” Debt / Equity)). (3) Rejects current U.S. 20 - year treasury note yield. (4) Rejects median of unlevered betas of comparable group. (5) Rejects median peer debt / equity. (6) Reflects levering of the median unlevered beta of the peers at target debt / equity ratio. Levered Beta = (Unlevered Beta) ” (1 + (1 - Tax Rate) ” (Debt / Equity)). (7) Reflects U.S. Long - Honzon Equrty Risk Premium per Kroll. (8) Rejects size premium per Kroll Valuation Handbook. (9) Calculated as Risk - Free Rate + (H istorical Risk Premium ” LeveredBeta) + Size Premium. (10) Assumes illustrative cost of debt based on trading yields of Norse's and Macy's bonds prior to takeover rumors. (11) Rejects Norse management long - term tax rate. (12) WACC equals ((Debt/Capitalization) ”After - Tax Cost of Debt) + (Equity/Capitalization ”Levered Cost of Equity)). 4 Risk - Free Rate( 3 * Unlewred Beta( * 4.41% 0.97 22
Corrgany Kohl's Peer Median Current Norse (Cons.) Norse (Mgmt.) Unaffected’ 3 ’ Share Price % of 52 - Wk. High Market Cap Enterprise Value EV / Adi. EBITDA' 1 ’ 2023A 2024E 202SE '23A - '2SE CAGR Net Sales EBIT DA 1 ’ EBIT Margin EPS 2023A 2024E Gross Net Leverage’ 2 ’ Leverage’ 2 ’ 1.2x 1.4x 4.7% 6.1% (12.5%) (8.1%) 0.6% 3.9x 3.8x 3.3x $7,563 $5,616 (7.8%) $19.85 3.0x 3.1x 4.0% 4.3 0 / (4.4%) (0.9 0 / ) 0.6 0 / 5.3x 5.4x 5.2x 7,584 3,264 (3.1 0 / ) 28.44 2.1x 2.2x 43% 5.2•/. (8.4%) (4.5•/.) 0.6•/. 46x 4.6x 42x 2.6x 3.5% 4.0 ƒ /. (3.1%) (2.1•/.) 2.3•/. 5.lx 5.lx 49x 5,685 3,376 (14.5%) $19.92 2.6x 4.1% 4.0 ƒ /. (3.1%) 5.4% 1.5•/. 44x 4.8x 49x 5,685 3,376 (14.5%) $19.92 2.6x 3.5% 4.0 ƒ /. (3.1%) (2.1•/.) 2.3•/. 47x 4.7x 45x 5,200 2,891 (26.8%) $17.06 Norse (Cons.) 2.6x 4.1% 4.0 ƒ /. (3.1%) 5.4% 1.5•/. 41x 4.4x 45x 5,200 2,891 (26.8%) $17.06 Norse (Mgmt.) 23 Source. Norse Management, company filings and FactSet as of March 27, 2024. Note. Dollars in millions except per share figures. (1) Norse LTP EBITDA figures add back amortization of developer reimbursement for comparison to consensus EBITDA. (2) Debt figures do not include leases and LTM EBITDA does not add back rent. (3) Norse figures as of unaflected date of March 18, 2024.
Selected U.S. Department Store Transactions EV/ LTM EBITDA EV/ LTM Revenue Enterprise Value Wquiror Target Date 6.3x 0.68x $2.8 Sycamore Partners Belk Aug - 15 9.1x 1.31x 6.1 CPPIB & Ares Neiman Wrcus Sep - 13 10.9x 0.91x 2.9 HBC Saks Jul - 13 9.1x 0.91x 2.9 Median 8.8x 0.97x 3.9 Average Source. Company filings, FactSet and Wall Street research. Note. Dollars in billions. 24
10.0x 9.0x 8.0x 7.0x 6.9x 6.0x 5.0x HBC / Saks announced Sept. 9, 2013 : CPPIB & Ares / Newman announced Sept. 24, 2015: Sycamore / Belk announced 4.0x Kohl's Macy's Norse 5.5x 4.9x 5.8x 3.5x 6.8x 4.8x Pre - COVID Avg.’ Post - COVlD Avg. 2 3.0X 5.2x (25%} 2.0x Jan - 13 Jan - 14 Jan - 15 Jan - 16 Jan - 17 Jan - 18 Jan - 19 Jan - 20 Jan - 21 Jan - 22 Jan - 23 Jan - 24 Source. Company filings and FactSet as of March 27, 2024. Note. EV / NTM EBITDA multiple smoothed in mid - 2020 to adjust for COVID distortions. (1) Pre - COVID period includes January 2013 through February 2020. (2) Post - COVlD period includes July 2021 through current. (3) Norse multiple reflects unaffected multiple as of March 18 2024 and Macy's multiple reflects unaffected multiple as of December 8, 2023. Norse Macy's Kohl's 25
D i sc Tosed Valuazto n Det atTs Forward P/E trading multiple 3/6/2024 $24.00 Buy KeyBanc 11.0x FY2025 P / E 3/25/2024 $22.00 Hold TD Cowen - 10.0x FY2024 EPS 3/5/2024 $20.00 Hold BMO - 5.0x FY2024 AV / EBITDA 3/6/2024 $20.00 Hold Citi - 7.8x 2025E EPS 3/6/2024 $19.00 Hold Telsey NA 3/5/2024 $18.00 Hold Goldman Sachs Forward P / E tmding multiple 3/14/2024 $17.00 Hold Jefferies 9.0x FY2025 EPS 3/6/2024 $17.00 Hold Evercore Forward P / E tmding multiple 3/22/2024 $17.00 Hold Gordon Haskett 4.0x FY2024 AV / EBITDA 3/6/2024 $15.00 Sell Bank of America 4.0x FY2024 AV / EBITDA 3/6/2024 $15.00 Sell JP Morgan 7.0x NTM P / E multiple based on CY2025 EPS 3/5/2024 $15.00 Sell Barclays 7.0x Forward P / E 3/6/2024 $13.00 Sell Morgan Stanley - 0.2x FY2026 AV / Sales 3/7/2024 $12.00 Sell UBS NA 3/6/2024 NA Hold Guggenheim NA 3/6/2024 NA Hold William Blair 517.00 Bi¥edian 517.43 Bi¥ean Analyst price targets in - line with unaffected Norse share price of 617.06 and below current share price of 819.92 Source. Bloomberg and Wall Street research. 26
APPENDIX C SUPPLEMENTARY MATERIALS 27
Share Price Performance Over Time ( 1 ! Indexed to 100; Since March 27, 2D21 250 200 150 100 50 0 Mar - 21 Sep - 21 i Mar - 22 L1Y a 3.0% i i , i Sep - 22 Mar - 23 December 8, 2023: Macy's unaffected share price of $17.39 March 18, 2024: i Norse unaffected share ' price of $17 D6 Sep - 23 Mar - 24 % 2 % Y (3 .5%) L3Y Source: Capital IO Notes: 1. Market data as of March 27, 2024 2. Represents Norse as of unaffected date I March 18, 2024 3. Represents Macy's as of unaffected date December 8, 2023 (59.9%) 28
Share price performance over the period of - (S o ô) (as of March 27' h ) March 5. 2024: Norse re ports Q4 end FY2023 earn ings aftern arket. Q4 performance ec LI OJLited FY2024 E OLIfIOOk $20.90 t 20 15 10 i i i $17.54 $16.91 $17.06 $17.49 March 18. 2024: March 19. 2024: ReLiters leaks story ! on Norse’s potentiel $17.80 $17.99 $17 60 $17.29 $17.06 i i i $19.38 $20.05 Unaffected Date (3/18) $18.91 $19.04 $18.62 3/5 3/6 3/7 3/8 3/11 3/12 3/13 3/14 3/15 3/18 3/19 3/20 3/21 3/22 3/25 3/26 3/27 Sourœ: Capital IQ Note: 1. Market data as of as March 27, 2024 Norse Share Price Performance and Trading Volume Over Time ( 1 Since March 5, 2024 Volume (MM) 40.0 i i Share Price, $ 25 Norse Volume (MM) 300 200 10.0 29
AV / NTM EBITDA Over Time ( 1 ! Since March 27, 2021 10.0x 8.0X 5.0x 0.0x Mar - 21 News of takeover Kohl's affected multiple of 5 January 21, 2022: Kohl s unaffected multiple of 4.0x Sep - 21 Mar - 22 November 17, 2022: Kohl s announces they will not engage in transformative transactions; multiple of 5 6x 2 i Sep - 22 Mar - 23 Sep - 23 /March 18, 2024: December 8, 2023: Macy's unaffected multiple of 3.7x N s d p e f4 ex oday Norse Unaffected ’ ’ i 4 7x L1Y Avg. 4.4x , i L2Y Avg. 3Y Avg 4.4x 5 0x Source: Capital IQ Notes: 1. I Market data and consensus as of as of March 27, 2024 2. Represents Norse as of unaffected date of I March 18, 2024 3. Represents I lacy’s as of unaffected date December 8.2023 30
• This risk can be mitigated with strong statements of conservative financial policy Norse's focus on reducing debt and directing free cash flow to debt retirement or re - investing in business over near term (i.e. no distributions to equity owner over next X period) is key to giving agencies additional confidence in maintaining ratings “Public Statements” will no longer be relevant as a go - forward private company — one route for displaying “commitment” to agencies will be to add more “lender friendly” covenants to the amended revolver (i.e. limiting Restricted Payments or Dividends) The existing Revolver does not have a “Double Trigger” change of control, and this transaction could create an immediate Event of Default. The most likely solution is to seek a waiver from existing lenders by converting the facility to an ABL structure and agreeing to more stringent covenants • The Change of Control Definition is focused on the Bond Ratings (rather than the Corporate Family Rating (CFR)) • Even if the agencies took a negative view on the transaction and downgraded the CFR, there could be a way to “protect’ the bond ratings by granting security to those bonds on unencumbered assets • Norse is still able to hold the bond rating if they are downgraded one notch by flipping the unsecured to secured despite sitting junior to the ABL • While the Inventories and Receivables would likely be required to be pledged to the amended ABL facility, Intellectual Property and Real Estate could be pledged to the bondholders, allowing those bonds to be “notched up” from the CFR and maintaining where they are today Currently Norse has a Ba1 CFR at Moody s, and the Unsecured Bonds are also rated Ba1. In this scenario, the CFR could be downgraded to Ba2, but the bondholders are granted collateral (Real Estate and IP), providing them a notch uplift from the CFR, and maintaining a Ba1 Bond rating, (avoiding the Double Trigger) 31
C ounterparty Outreach Date NDA IYlanagement Iganajjement Meetinjj Signed IYleetinjj Date Details Iganajjement Meetinjj Attendees Follow Up Session Date 1/8/24 Moelis Inbound week of 1/8/24 1/9/24 Inbound 10/31/23 11/1/23 10/31/23 üï River 1 11 26/23 Note: 1. Management conducted a preview meeting with 12/13/23 on Zoom 1/18/24 2/2/24 3/19/24 1/29/24 1/17/24 1/17/24 Meeting at Centerview Partners (NYC) Meeting at Norse Headquarters and storewalk i i I Meeting at Norse Headquarters i i Meeting at Morgan Stanley (LA) i Meeting at Centerview Partners (NYC) Meeting at i I Meeting at Morgan Stanley, sore walk and dinner (LA) 1/25/24 • Graciano Guichard Gonzalez, Chief Executive Officer • Enrique Guijosa Hidalgo, Chief Financial Officer 1/30/24 Declined Proposal 2/9/24 Passed 1/26/24 Potentially Interested Potentially Interested Passed Passed Bid Received Passed Passed Passed Potentially Interested 32
Counterparty Outreach Date NDA Big ned Iganagement Igeeting Date Follow Up 8esoion Date 11/3/23 12/7/23 11/3/23 1D/15/23 12/8/23 1D/15/23 1D/31/23 12/13/23 12/7/23 12/7/23 1D/15/23 Passed Passed Passed Passed Passed Passed Passed Passed Passed Passed Passed 33
• Execute Baseline LTP and consistently beat Street estimates Management LTP implies outperformance vs . Street Consensus Solid foundation for execution with clean inventory position, Canada exit and optimized supply chain Investors may not re - rate JWN's multiple even with outperformance Negative investor sentiment in the sector persists Weak trading / execution at peers has created an unfavorable backdrop for JWN JWN may be a target for future activists given its low multiple • Payout excess year - end cash as a dividend each year • Use excess cash flow to establish robust buyback program • Execute sale leaseback transactions of the Company's owned real estate portfolio and distribute proceeds to shareholders Investors typically do not seek dividend yield from discretionary consumer sector x Taxable event for shareholders x Potentially signals lack of investment opportunities Investors likely to expect annual dividend increases going forward Moderate Moderate Sends long - term confidence signal on future free cash flow generation Immediate cash realization for shareholders Limited Low Execution does not require new counterparty Enhanced capital return profile Advantageous in current valuation context relative to historical trading levels Evolves shareholder base towards long - term oriented investors Indirectly increases Family / Liverpool stake Success varies based on timing of repurchases and valuation at execution Potentially signals lack of investment opportunities Increase in rental payments will decrease EBITDA going forward X Challenging environment for real estate sales / elevated cap rate environment Potential for tax leakage, depending on basis Increases risk of ratings downgrade Limited Low Unlock value to distribute to shareholders or reinvest in core business Streamlined operations and strategic footprint Limited High 34
• Separate Full - Line (“Namesake•) and Rack into two distinct businesses with separate management teams and shareholders • Liverpool increases its stake via a Tender Offer • Optimize shareholder base by inviting Liverpool to partner with additional strategic investors to increase ownership • Sell the business to a strategic acquiror or financial sponsor Potential value upside if Rack re - rates towards Off - Price peer multiples Optimize management team and strategy around single distribution channel Increases specialized operational expertise at each separated business Viability of Rack as standalone public entity in light of current scale and recent performance Potential multiple contraction for Namesake towards Macy's and Kohl's Ongoing dis - synergies and stranded costs from separation x Likely to reduce trading volume / liquidity of stock X Transaction may be perceived as a step towards a take - private or entrenchment of family / management Liverpool's willingness to pay a premium for a larger minority stake X Facilitating increase in Liverpool stake could be seen as inconsistent with rationale for poison pill adoption (i.e., ensuring shareholders receive control premium for sale of control) Moderate High Provides current shareholders an opportunity to tender at a premium Transitions shareholder base to more of a long - term orientation Signal of validation from major existing shareholder and strategic investor Limited Moderate Immediate monetization for public shareholders Demonstrated inbound interest New debt financing not likely required Aligns shareholder base with long - term focus Nordstrom Family could roll ownership stake x Control / governance to be negotiated x New investors will require eventual liquidity event via stake sale / re - IPO Recent trading levels and public Department Store peers may be valuation reference x Limited universe of strategic acquirors x Limited financing available for sponsors Likely requires refinancing existing debt Recent trading levels and public Department Store peers may be valuation reference Material Moderate Immediate monetization for all shareholders Material High 35
LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview. 36 PRELIMINARY DRAFT
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Exhibit
16(c)(vii)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW PROJECT NORSE UPDATE MAY 5, 2024
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 2 EXECUTIVE SUMMARY ▪ The Department Store landscape remains challenged and continues to lose market share to other channels within the broader Apparel & Footwear ecosystem, contributing to bearish investor sentiment regarding Norse and its peers ▪ Norse’s share price has decreased by 61% over past five years and currently trading at an NTM EBITDA multiple of 4.7x, below its 5 - year average of 5.3x (1) – Norse is still trading at a premium to Macy’s (3.7x AV / NTM EBITDA) implying additional potential downside risk (2) ▪ Management’s Long - term Plan (“LTP”) significantly exceeds Street Consensus – FY2023A – FY2025E revenue CAGR of 1.5% and FY2025E EBIT Margin of 4.4%, relative to Street Consensus of 0.8% and 3.6% ▪ Norse's multiple is unlikely to improve without sustained outperformance, which is subject to execution risk ▪ Even if management achieves the LTP, the multiple may remain at current levels or further contract if investors remain bearish on the Department Store sector Source : Capital IQ Notes: 1. Represents Norse as of unaffected date March 18, 2024 2. Represents Macy’s as of unaffected date December 8, 2023
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 3 AGENDA 1 Market Perspectives on Retail and the Department Store Sector 2 Norse Market Perspectives 3 Morgan Stanley and Centerview Valuation Analysis
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 4 SECTION 1 MARKET PERSPECTIVES ON RETAIL AND THE DEPARTMENT STORE SECTOR
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 5 Source: Market Data as of April 25, 2024; Morgan Stanley Research, Fred, St. Louis Fed, Deloitte ConsumerInsights, Retail Peer Transcripts TRENDS AFFECTING THE CURRENT STATE OF THE CONSUMER Elevated levels of inflation and higher interest rates Depletion of savings and decrease in savings rate Spending power increasing, concentrated for top income households +3.5% +130bps March US CPI YoY US 10 - Year % YoY Discretionary retail store traffic remains well below 2019 levels (21%) 1Q2024 vs 1Q2019 Consumption by the top income quintile has accounted for 45% of all consumer spending from 2020 - 2022 Consumer wallet shifting focus to experiences vs. physical items In the first two months 2024, consumer services spending growth was ~7%, whereas consumer spending on goods growth was <1 % Decrease of 81% in Excess Savings from Pandemic - High in August 2021
Forward Valuation Multiples: AV / NTM EBITDA Retail Other Relevant Maximum ñfedian 5.1x 3.6x 7.5x 4.3x 9.2x 4.4x 15.1x 12.0x Department Stores*’) Apparel Retail*) Spec/a/ty Retail’" Off - Price* 4 * C a tegory Median» - NTM PfE ’23 - ’25E Net 9.9x +1% NTM EBIT Margin 4% 12.9x 5% 8.5y 23. 0X 14.8x 13.4x 20.6x 14.1x 9.9x 10.2x 6.9x Home Improvemenr S ' Growth Retai/ Apparel!’! 19. 9x +1% Source. Company filings, FactSet and Capital IQ as of April 25, 2D24. Note. EBITDA figures unburdeJ •d by amortization of d •V€*Ioper reimbUrs •rnents. (1) Department Stores peers include Kohl's, Macy's and Norse. (2) Apparel Retail peers include Abercrombie, American Eagle, Children's Place, Fat Locker, Cap, Guess and 'Victoria's Secret. (3) Specialty Retail peers include Academy Sports, Best Buy, Dick's Spoi1ing Goods, Office Depot and Petco. (4) OIf - Price peers include Burlington, Ross and T.J. Maxx. (5) Home Improvement peers include Home Depot and Lowe's. (6) Growth Retail peers include Five Below, FI‹ ir and Décor, Tractor Supply and Ulta Beauty. (7) Apparel peels include Levi's, PVH and Ralph Lauren. Excludes VF Corp. (8) Reflects fiscal years ending January the foIk›wing calendar y£•6E. 24.4x 14. 7x 10% 11% 6
Multiple vs. Sales Growth AVE NTB EBITDA Average AV NTB EBITDA per Fiscal Year Other Regressions on Multiple for e C o rreln e t d Dept. Store and Retail Peers Today i Norse Over Time 16x R ƒ = 0.52 TJ 12x 10x 8x 6x 4x 2x I I | gy R 2 = 0.96 8x ,* I Apparel Refai/ K I's Norse Macy's I I I 7x 6x I I 5x FY'18 FY'16 •’ ,’ FY'17 FY'19 FY’15 FY'14 , FY’21 F ”20 excl from regression | 0% +2% +4% +6% +8% Forward Sa/es Growth!’! +10% I (5%) (2%) +1% +4% +7% +10% +13 0 /« ’23A - ’25E Sa/es CAGR!’! I 4x FY’23 Source. Company filings and FactSet as of Apnl 25, 2024. (1) Reflects Net Sales CAGR for Norse, Macy's and Kohl's. Represents Revenue CAGR for all other peers. (2) Reflect 2 - year forward net sales growth. (3) Defined as the difference of the high and low 2025 estimate divided by consensus. Potential Drivers R 2 EBIT Margin (NTM) Estimate Dispersion(^) EPS Growth (NTM) EPS Estimate Dispersion(^) Sales Beat % Last 30 Quarters ’22 - ’24E EBIT Margin Expansion Net Sales Estimate Dispersion(^) 0. 70 0.6d 0.57 0.51 0.14 0. 08 0.15 7
Spread of FY 25E Consensus Estimates! Net Sales EBIT Adj. EPS! 2 ! Memo: Median AV / NTM EBITDA Greater Uncenainty • - Greater Certainty 8% 6% Apparel Retai/ Depanment Stores 20% Source. Company filings, Wall Btreet research and FactSet as of Apnl 25, 2024. Note. Figures reflect fiscal years ending January the following calendar year. EBITDA figures unburdened by amortization of developer reimbursements. (1) Calculated as the difference of the high estimate and the low estimate divided by the consensus estimate. (2) Specialty Retail excludes Petco's Adj. EPS consensus spread. Lower Multiple ’igh Multiple 8
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 9 INVESTOR PERSPECTIVES ON THE DEPARTMENT STORE SPACE Bearish investor sentiment regarding the Department Store space continues to weigh on Norse • Declining market share due to greater competition • Department Store margins in secular decline • Channel shift to lower margin E - Commerce sales • Weak future earnings growth prospects • Brands shifting to DTC reduces reliance on Department Store channel • Higher reliance on adjacent sources of revenue / income (e.g., Credit Card Fee Share) rather than core category sales
U.S. Apparel & Footwear Retail Sales Over Time ($bn) 4”o 36/0L Overaif % of Total CAGRs Depanment Store $298 $205 / 69 O fo $15 / 5% $25 / 89t› 2008 +s% $342 $218 / 64% $22 / 69f› $53/ 1.696 2015 (1%) $370 $207 / 56% $30/ 8% $98 / 2695 +16% 2019 ( O o) g +14% $420 $36 / 99a› $164 / 399t› 2023 ’18 - ’23 S Change Source. Euromonitor. Note. Dollars in billions. Other Retail includes Grocery Retailers, Variety Stores, Apparel & Footwear Specialty, Sports Goods Specialty, Other Non - Grocery Retailers and Direct Selling. 10
Estimated Future Market Outlook* Sensitivity of Dept. Stores 2028 Value ssoy avev s yo uo¡çodov <j •• › s • id $412 Department Store Other Retail 192 / 4696 2023 CAGR $464 $160 / 3596 2028 E - Commerce 2023 - 2028 CAGR 15•/ $27 20”/o $25 $22 10.0% 7.4 D / 5.0•/ $22 $26 $29 10”/o $17 $12 Off - Price Based on Euromonitor Estimates Other Retail Allocated Remainder Of Share Loss Source. Euromonitor. Note. Dollars in billions. Other Retail includes Grocery Retailers, Variety Stores, Apparel & FooMear Specialty, Sports Gods Specialty, Other Non - Grocery Retailers and Oirect Selling. (1) 2D28 estimate assumes overall market gro vs at 296 annually, in line with historical trend. E - Commerce and Off - Price forecast based on Eu+omonitor outlook foT C£• Sub - sectors. Implies share losses for Department Stores and Other Retail. Loss aIk›cated 15'f6/ 8S96 based on historical trend. ! Department ! StOre Growth 11
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 12 STRATEGIC LANDSCAPE CONTINUES TO EVOLVE Strategic M&A Rumored Transaction Take - Private Candidates Transaction Under Negotiation Prior Take - Private Attempt in 2022 Online Rationalization Sold to Coupang Active Sale Process Sold to Naver Recent Bankruptcies Recent sector activity underscores a weak demand outlook and potential for further consolidation
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 13 SECTION 2 NORSE MARKET PERSPECTIVES
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 14 INVESTOR PERSPECTIVES ON NORSE’S VALUATION MULTIPLE • Most investors view the Department Store category as being in secular decline • End - markets are shrinking, overall uncertainty is rising, and competition is increasing as consumers are faced with more alternatives than ever before • Given its historical performance, Norse will likely need to beat Street Consensus and raise expectations consistently for several years, meaningfully inflecting key drivers like revenue and profit growth and demonstrating a more sustainable margin profit, to change investors’ bearish sentiment • As a result, even when Norse results fare well, investors remain uncertain on Norse’s ability to deliver future topline and profit growth which is compounded by significant operating leverage and its impact on profitability • Even if Norse achieves the LTP, or becomes the winning consolidator in the space, the public markets may not re - rate its valuation multiple given the overarching unfavorable Department Store dynamics at play • While there are examples of retailers successfully re - rating their multiple, they typically require a catalyst and high degree of clarity / confidence on long - term strategy that results in re - rating, combined with dramatically step - changed financial performance
Share Price Performance Over Time ( 1 ! Indexed to 10D; Since Apnl 25, 2019 200 150 100 50 0 Apr - 19 LSY Oct - 19 Apr - 20 Soorce: Capital IO Notes: 1. Market data as of Agril 25, 2024 2. Represents Norse as of unaffected date March 18, 2024 3. Represents Macy's as of unaffected date December 8, 2023 i i Oct - 20 Apr - 21 2 i Norse Unaffected ’ ’ 3.0% (36.5%) (59.9%) (61.4%) Oct - 21 Apr - 22 Oct - 22 December 8, 2023: Macy's unaffected share price of $17 39 Apr - 23 Oct - 23 March 18, 2024: › iNorse unaPected shares Apr - 24 15
Norse AV / NTM EBITDA Valuation — Last 10 Years Noise 12.0x 11.0x 10.0x 9.0x 8.0x 7.5x 7.0x 6.8x 6.0x 5.0x 4.0x 3.0x 2.0x Shading /2e//ects 1 - 9 Percent/ie in Each Phase 2014 2015 2016 2017 2018 2019 2020 ( ” 2021 inferno * 2 *: Fwd. Net Sa/es GroMh 9% NTM EBIT Margin 10 ƒ / NTM EBIT Oispers/on* 7% Note. ( ) (2} (3) (4) 7 0 / 179 2% 17 0 / Norse 12% n.m. n.m. Department Store Peer Average Source. Fact5et and Capital IQ as of April 25, 2024. EBITDA figures unburdened by arnartizaâon of developer reimbursements. AV / NTM EBITDA mulâple averaged through mid - 2020to smoolh sharp swings in broker estimates. Reflects estimates as of April 2S of each year. Calculated as the diflerence of the high and low NTM EBIT estimate divided by conser+sus. Reflects current Norse AV / NTM EBITDA multiple. 5% 2022 5 % 50% 43% 19% increased dispersion rejects perceived uncertainty 2023 2024 16
Norse Share Price Decomposition — Last S Years &41.05 Apr - 19 rim zairo> S1,«zi xv/rim zairoz s.lx Source. Company filings, FactSet and Capital IQ as of April 25, 2024. Note. EBITDA figures unburdened by am‹a1ization of developer reimbursements. (1) Reflects April 25, 2015. (2) Reflects change in share count and net debt. (3) Reflects unaffected date of March 18, 2024. (&4.00) $17.06 A in Fwd. EBITDA Estimate A in AV / EBITDA A in Capital Structure’* Mar - 24 ($522) (0.5x) 17
2026E 2023A 2019A 2026E 2023A 2019A EBIT Margins!: Mariret Share: 2.0% N Stores 3.6% 24.6% 21.1% N Stores 17.0"A 5.2% 3. 7•A R Stores 9. 0 ƒ X« 10.9% 10.4% R Stores 13.2 ƒ / 8.2% E - Comm 8.4% 2. 7 0 % 2.9% E - ComrrY’! 4. 6% 5.0% horse 5.4% Net Sales EBIT 5221 5150 horse Stores Rack Stores CAGRs $15,132 ” ” $15,099 Source. NDfSO management and Euromonitor. E - Comm market share reflects Net GMV. (1) (2) Segment EBIT margins burdened by allocated corporate expenses. $816 $375 $567 $277 5 755 +1 0 0% $414 18
Declining Store Productivity Increased Online Penetration Declining Margins Store Only Sales / Avg. Gross Sq. Ft. ($MM) $369 $401 $336 $336 FY2023A FY2019A FY2015A FY2010A FY2023A FY2019A FY2015A FY201 0A FY2023A FY2019A FY2015A FY2010A 4.19’» 6.49 8.1 ƒ A 11.4% 299’» 24% 14 ƒ 4 $118 $144 $165 $188 Kohl's 5.99’» 8.6% 7.79’» 339’» 26% 14 ƒ 4 $148 $149 $162 $154 Macy's Source. Company Materials 8 0 / Digital Mix (% of Net Sales) 20% 33% 36% 12.0% EBIT Margin (%) 8.0% 19
Total Revenue ($bn) EBIT ($bn) Adj. EPS ($bn) S1 4.7 $14.7 S 1 4.6 15.6 FY2023A FY2024E FY2025E Memo: Consensus % Growlh (5. 4%) (0.1%) 1. 5% FY2026E l. 0% $ 0.6 $0.5 $0.7 $0.5 $0.5 FY2023A FY2024E FY2025E Ivlemo: Consensus % Margin 3. 9% 3.5% 3.6% FY2026E 3. 4% $2.12 $1.82 S 3.14 53.49 $2.21 FY2023A FY2024E FY2025E Memo: Consensus % Growth 26.Who (1 . /) 9.1% FY2026E 11.3 ƒ Consensus (shading represents range of analyst estimates) Afanagemenf's Correnf LTP Source. Company filings, Wall Street research, FactSet and Capital IQ as of April 25, 2024. Note. Figures reflect fiscal years ending January the following calendar year. 20
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 21 SECTION 3 MORGAN STANLEY & CENTERVIEW VALUATION ANALYSIS
Growth: Margin: FY2028E FY2027E FY2D26E FY2025E FY2024E FY2D23A FY2022A FY2019A 5.0% 4.9% Consensus 4.8% Management Long - Term Plan vs. 4.4% 4.0% Management Long - Term Plan Consensus H‹stoûcaJ Margin: 15,524 FY2019A 1,455 FY2019A 784 Actual Performance 15,530 FY2D22A 1,1D6 FY2022A 502 14,693 FY2023A 1,153 FY2D23A 567 LTP Extrapolation Assuming Consistent Strategy and Execution LTP Reviewed with the Board in November 2023 /g ' 14,625 FY2O24E (0.5%) - r7% 1,111 1,186 FY2024E 8.1% 508 580 15,127 ,935 FY2D25E 3.4% ,281 FY2025E 8.5% +2SM 533 668 15 611 15 251 ' FY2026E 3.2% +2f9f› 1,358 ,119 FY2D26E 8.7% 515 755 16,094 FY2027E 3.1% 1,416 FY2027E 8.8% 795 So sœ: Capital IO as of Agril 25, 2024; Management Long - Term Plan as of March 28, 2024 for years FY24 - 26, extrapolations thereafter per rranagerrent goidanœ Note: 1. Adds back all depreciation and amortization, including arrorttzation of developer reimbursements 16,577 FY2D28E 3.0 1,475 FY2028E 8.9% 835 FY’24E — FY36E CAGR 7.0%
IIIustrative Future Share Price Trajectory (LTP and Consensus Estimates) $50 $40 $38. 72 gg $30 $25 $20 $15 $10 $5 Mar - 21 Mar - 22 Present V’a/ue or rutu re Share Prfc&’ LTP Consensus Mar - 23 LTP (3 - year) at 4.5x NTM EBITDA LTP (3 - year) at range of 4. 0x — 5.0x NTM EBITDA Consensus at 4.5x NTM EBITDA Consensus at range of 4.0x — 5.0x NTM EBITDA Historical share price Unaffected Price: $17.06 Mar - 24 Mar - 25 $19 $16 Source: Nors£ managers •nt, company filings, FactSet and Capital IQ as of April 25, 2024. Note. Future share prices represent future value and do not include value of dividends. Consensus free cash flow extrapolated based on LTP free cash flow conversion rate. (1) AYUSH jet - based cost of equity of 17.496. Mar - 26 $20 $14 23
Hi Low lied Share Pri Metric ($MM) Methodolo Rounded to the nearest $D 25 Public Trading Comparables 1 * 5,556 3889 I $1›J.25 $9.25 1,111 Consensus. AV / FY2024E EBITDA. 3.5x - 5.0x 5,929 4, 50 $21.25 $10.75 1,186 Management LTP Case. AV / FY2024E EBITDA. 3.5x - 5 Dx Discounted Equity Val ue * 2 ) 5,19D 3,919 $1".00 $9.50 1,119 Consensus. 3.5x - 5.0x FY2026 EBITDA 6,079 4,554 $13.25 1,358 Management LTP Case. 3.5x - 5.0x FY2026 EBITDA Discounted Cash Flow 3 * Management LTP Case. 3.5x - 5 Dx Exit Multiple; 8.7% - 9.7% WACC Reference Only 52 - Week Trading Range Analyst Price Targets (Undiscounted) ! 4 * Analyst Price Targets (Discounted) ^) Leveraged Buyout ”’ Management LTP Case. 17.5 ƒ 4 - 22.5 ƒ A Target IRR; Exit Multiple = Entry $0 $15.75 $13.00 $12.00 $10.50 $ 40 $16.75 $25.50 $29.50 $24.00 $ 21.00 $19.75 $20 ' $30 Source: Capital IO (unaffected date of March 18, 2024, current as of Agril 25, 2024); Management Long - Term Plan as of March 28, 2024 for years FY24 - 26, extrapolation thereafter Notes: 1. Range based on NTM trading multiples of Macy's (3.7x) and Kohl's (5.0x), as of unaffected date of klarch 18, 2024 2. Represents present value of irnglied year - end 2025E share pdce based on disœunted equity value analysis; share pricœ and cumulative dividends discounted at 14.6‘l6 cost of equity; sensitized on +0.75x / (0.75x) exit rixiltiple 3. Irrplied share priœ based on OCF multiples method; WACC of 9.296; EBITDA exit rrsJltiple of4.25x sensitized on +0.75x / (0.75x) 4. Represents present value of median of analyst priœ targets as of Agdl 25, 2024: discounted analyst price targets discounted at 14.696 œst of equity; excludes Morningstar 5. Represents irnglied entry priœ to generate 17.5 - 22.5% IRR based on Management Long - Term Plan 4,978 6,291 4,52 6,376 4,V2 5,868 4,088 5,147 6,63D 5,656 74
For Re Serene e Only 52 - Week Trading Range Analyst Price Target Ran ge ’ Premia Paid Analysis Pub lic Trading Comparables Discounted C ash Flow Analysis Methodology Assumption 52 - Wk High: 08/01/23 52 - Wk Low: 11/13/23 High: 03/31/24 Low: 03/07/24 Premium to Unaffected: 25% - 40% 4.0x - 5.0x '24E EBITDA of $1,186mm WACC: 10.5% - 13.0% PGR: 1.5% - 2.5% Implied Sfiare Priae Value $13.10 $12.00 $14.35 $13.00 $23.30 $24.00 $21.30 $23.90 Lli›affected S/?are Price. 517. 06 821.35 $23.20 Implied AV/ z4E Es/roA imp«aav $4,526 $6,257 3.8x 5.3x $4,342 $6,376 3.7x 5.4x $5,923 $6,356 5.0x 5.4x $4,743 $5,929 4.0x 5.0x $4,512 $6,240 3.8x 5.3x Source. NDrse management, Company filings and FactSet as of April 25, 2024. Note. Implied share prices rounded tD the nearest @.05. Illustrative DCF valuatian date Df February 3, 2D24. Assumes mid - year discounting. Public Trading Comps reflect LTP financials. EBITDA is unburdened by amortiza5on of developer reimbursements. (1) High reflects KeyBanc; Low reflects UBS. 75
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 26 Premium / (Discount) to: AV / EBITDA Equity Aggregate Illustrative (1) Illustrative (1) Illustrative Market Value Value 2023A 2024E Family Rollover Liverpool Rollover Rollover Equity 6 - Month VWAP vs. vs. 30 - Day 60 - Day 90 - Day Unaffected Current VWAP VWAP VWAP Illustrative Share Price 169MM (2) $2,309MM (3) FDSO Net Debt $1,153 $1,186 27.6% 9.3% 36.9% 63.1% $17.12 Unaffected: $17.06 $19.00 $19.03 $18.68 $17.28 2,891 5,200 4.5x 4.4x 798 269 1,066 1,825 (0%) $17.06 -- % (10%) (10%) (9%) (1%) 3,050 5,359 4.6x 4.5x 842 284 1,125 1,925 5% $18.00 6% (5%) (5%) (4%) 4% 3,220 5,529 4.8x 4.7x 888 299 1,188 2,032 11% $19.00 11% -- % (0%) 2% 10% 3,389 5,698 4.9x 4.8x 935 315 1,250 2,139 17% $20.00 17% 5% 5% 7% 16% 3,559 5,868 5.1x 4.9x 982 331 1,313 2,246 23% $21.00 23% 11% 10% 12% 22% 3,728 6,037 5.2x 5.1x 1,029 347 1,375 2,353 29% $22.00 29% 16% 16% 18% 27% 3,898 6,207 5.4x 5.2x 1,075 362 1,438 2,460 34% $23.00 35% 21% 21% 23% 33% Source: Capital IQ Notes: 1. Interest of family and Liverpool rollover to be assessed during process 2. Fully diluted shares inclusive of 163.3MM basic shares outstanding and 6.2MM unvested RSUs 3. Net debt inclusive of $2,937MM in debt and $628MM in cash and equivalents Current Share Price as of April 25, 2024; VWAP as of Unaffected Date of March 18, 2024 ILLUSTRATIVE EQUITY CHECK SENSITIVITY
27 PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW APPENDIX MORGAN STANLEY & CENTERVIEW SUPPORTING VALUATION ANALYSIS
Discounted Cash Flow 3/28/2024 $38.50 Buy Morningstar " Forward P/E trading multiple 3/31/2024 $24.00 Buy KeyBanc 11.0x FY2025 P / E 3/25/2024 $22.00 Ho'rl TD Cowen - 5.0x FY2024 AV / EBITDA 3/6/2024 $20.00 Hold Citi - 10.0x FY2024 EPS 3/5/2024 $20.00 BMO 9.5x 2025E EPS 4/19/2024 $19.00 Oil Telsey NA 3/5/2024 $18.00 Ho'd Goldman Sachs Forward P / E trading multiple 3/14/2024 $17.00 Jefferies 9.0x FY2025 EPS 3/6/2024 $17.00 Ho rJ Evercore Forward P J E trading multiple 4/3/2024 $17.00 Ho'rl Gordon Haskett 4.0x FY2024 AV / EBITDA 3/6/2024 $15.00 Sell JP Morgan 7.0x NTM P / E multiple based on CY2025 EPS 3/5/2024 $15.00 Sell Barclays 4.0x FY2024 AV / EBITDA 3/6/2024 $15.00 Sell Bank of America 7.0x Forward P / E 3/6/2024 $13.00 5eIi Morgan Stanley - 0.2x FY2026 AV / Sales 3/7/2024 $12.00 Sell UBS NA 3/6/2024 NA Ho rJ William Blair NA 3/6/2024 NA Guggenheim Present Value: $14.83’* 517.00 Median Present Value: $15.20 517.43 Memn as of Agril 25, 2024 and Mean calculations Sauce: Wall Street Eguity Research, Market Data Note: 1. I Morningstar Price Target excluded from Median 28 Equity 2. PV share price discounted using 14.6% Cost of Morgan Stanley
Future Share Price (mel. Dividends)! 1 ! MMM / Share Current AV / NTM Adj. EBITDA Multiple (x) NTM Adj EBITOA Future Aggregate Value ( — ) Net Debt Future Equity Value FDSO ” Future Share Price {SUSD) $21.42 45 2024E 3.50x NTM Adj. EBITDA — Future Share Price IncL Dividends Periods Discount Factor ” Discounted Share Price (SUSD) Discounted Share Price Incl. Dividends Premium /(Discount) to 30D VWAP ($18 Premium / (Discount) to Unaffected ($1 7.06) ! 3 * Premium / (Discount) to Current ($19.00) t*t $22.27 32 37 2D25E Present Value of Future Share Price (Incl. Dividends) ! 1 ! !*! $MM / Share 519 OD Cuœent 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x 2024E 2D25E 3.5x 126 3,942 (2,114) 3.5x 119 3,915 (2,061) 1,828 1,854 169 169 510.79 S1145 510.94 512.37 1 DD D.87 2 DD 0.76 CB.32 59.48 (41.4"A) (47.4%) (44.4%) {507%7 AV / NTfg Adj. EBITDA of 4.25x 2024E 2025E 4.3x 126 4.3x 119 (2,114) 2,673 169 $15.77 516.44 1 DD D.87 513.76 51&34 (16.0"A) (24.5 ƒ 4) (2,061) 2,693 169 515.B9 517.32 2.DD D.76 512.09 513.25 (23.3 ƒ A) (30.3•A) $18.69 $9 2024E 5.00x NTM Adj. EBITDA 5,632 (2,114) 3,517 169 520.76 521.42 1.OD D.87 518.10 518.69 9.5X (1. 69â) Morgan Stanley 59 2025E AV / NTM Adj. EBITDA of 5.00x 2024E 2025E 5.0x 5.0x ,119 5,593 (2,D61) 1. Calculated as NTM EBITDA rnult@lied by illusbative AdI. EBITOA muItg›Ie subtracted by proleded uet debt divided by 3WN FDSO of 16s; inclusive of kiture value of curniJative dividœids per share discœinted to present value 2. Discnunted to February 3, 2024 at 14.6% castof eguity 3. Mæket data as of Mratlècted date of Maicfi 18, 2024; Curierit share pñœ as of April 25, 2024 3,532 169 520.84 512.27 2 DD D.76 $15.B6 Denotes range on FBF 29
Future Share Price (Incl. Dividends) ! 1 ! $MM / Share 00 Current 27 09 2024E 3.50x NTM Adj. EBITDA $29 D7 21 2D25E Present Value of Future Share Price (Incl. Dividends) ! 1 ! ! 2 ! $MM / Share 0D Current 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x $21 2024E 5.00x NTM Adj. EBITDA Morgan Stanley 77 2025E AV / NTM Adj. EBITDA of 5.00x 1. Calculated as NTM EBITDA moltlglied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by JWN FDSO of 169MM; incisive of future value of cumulative dividends per share discounted to present value 2. Discounted to February 3, 2024 at 14.696 cost of eqMty 3. Market data as of unaffected date of March t8, 2024; Current share price as of Agril 25, 2024 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 5.0x 4.3x 4.3x 3.5x 3.5x AV / HTM Adj. EBITDA Multiple 1,358 1,281 358 1,281 358 281 (x) NTM Add EBITDA 6,791 6,406 5,773 5,445 Future Aggregate Value (2,152) (2,407) (2,152) (2,407) (2,152) (2,407) ( — ) Net Debt 4,639 4,000 3,621 3,039 2,602 2,078 Future Equity Value 174 172 174 172 174 172 FDSO * 1 * 526.68 523.28 520.82 $14.96 $12.09 Future Share Price ($USD) 529.07 524.27 $23.21 518.68 517.35 513.09 Future Share Price Incl. Dividends 2.D0 1.00 2.00 1.00 2 D0 1 D0 Periods 0.76 0.87 0.76 0.87 0.76 0.87 Discount Factor ’ 2 * 515.84 Discounted Share Price ($USD) 24.1 ƒ A $17.77 (33.1 ƒ A) DiscDunted Share Price Incl. Dividends Premium / (Discount) tO 30D VWAP ($18 Premium / (DiScount) tO Unaffected ($1 7.06) 3 * 1 1.4 ƒ A (6.5%) (39.9 ƒ A) Premium / (Discount) tO Current ($1 9. 00) ( 3 DenDtes range on FBF Notes: 30
Key Assumptions • February 3, 2024 valuation date • Financials presented on January ending fiscal year • 5 - year DCF using mid - year discounting convention • WACC range of 8.7% - 9.7% • Illustrative effective tax rate in years FY24E - FY28E of 27% • Terminal year assumptions: — D&A equal to terminal year CapEx — Increase in NWC calculated from 2% revenue growth into perpetuity Unlevered Free Cash Flow Forecast ! 1 $MM, unless otherwise noted ( - ) D&A ( - ) Amort. Of Developer Reimbursements EBIT & Margin ( - ) Tax Expense N Effeoive Tax Rate (+) D&A (+) Amort. Of Developer Reimbursements (+) Right of Use Asset Amort. (+) (Increase) / Decrease in Lease Liabilities (+) (Increase) I Decrease in NWC ƒ ’ ( - ) CapEx Unlevered free Cash Flow & Free Cash Flow Converfifion !“’ FYE February 3 2024E Revenue 14,625 Adiusted EBITDA 1,186 % Margin Implied Share Price Terminal EBITDA Exit Multiple Discount Rate Present Value of: Forecasted Free Cash Flow Terminal Value Implied Agpre$ate Value f — ) Net Debt ^” Ful Diluted Shares "* % Premium / (Dlscount) to Unaffected ' 6 ’ % Premium / (Discount) to Current ” Implied AV/ 2€I24E EBS TDA Implied AV/ 2€I2SE EBI TDA Notes: 1. Terminal LTM EBITDA assumes 3.0‘I6 terminal revenue groMh; 8.9‘l6 terminal EBITDA margin 2. NWC for years 2027E - 2028E represent 5’I6 of the change in revenue 3. Free Cash Flow Conversion represents Unlevered Free Cash Flow divided by Adjusted EBITDA 4. Net debt as of 04 2023A, inclusive of $2,937MM of debt and $628MM of cash 5. Fully diluted shares as of 04 2023A; inclusive of 163.3MM basic shares outstanding and 6.2MM unvested RSUs 6. Unaffected date as of March 18, 2024 7. Current market data as of April 25, 2024 8. 1N {517) (89) {157) 517 89 197 {280) 240 2025E 15,127 1,281 528) f85) (180) 528 85 198 (283) 42 M9 8.7% 9.2% 9.7% 2026E 15,611 1,358 (538) f65) 755 (2V) 538 65 202 (288) (21) (>s) 501 2027E 16,094 1,416 (5M) (67) 795 (215) 554 67 202 (297) (21) (555) 530 8.7% 4.25x 9.2% 9.7% 2028E 16,577 1,475 (571 ) (69) 835 (LS) 571 69 202 (306) (21) f564) 561 Morgan Stanley Terminal 1,4/5 (564) (69) (227) 564 69 202 (306) (15) f564) s66 8.7% 5.00x 9.2% 9.7% 1,758 401 5,159 1,736 325 5,060 1,714 250 4,964 1,758 130 5,888 1,736 037 5,773 1,714 5,660 1,758 859 6,617 1,736 750 6,485 1,714 643 6,357 (2,309 I (2,309) (2,309) (2.30u) (2,309) (2,309) (2,309) (2,309) (2.309) 2,751 2,655 2,850 169 169 169 169 4,048 169 /f 796 y ( 1 % ) 4 . 4 x 4.0x (15%) 596/ 4.3x 39x (18%) (886) 4.2x 39x 11% 2496 5.Ox 4.6x 8% 2 96 4.9x 4.5x 4 Y696 4.8x 4.4x 34% 49B 5.6x 52x 3096 44% 5.5x 51x 2696 40% 5.4x 5.åx Denotes range on FBF 31
Exit Multiple dL5E 4AX €2x $49. / $19.31 519.00 $18.68 $18.36 17.5% $19.10 $18.80 $18.50 $18.20 $17.90 18.836 $18.61 $18.32 518.03 $17.75 $17.46 20.01 $18.14 $17.87 $17.60 $17.32 $17.05 21.3% $17.70 $17.44 $17.18 $16.93 2,937 25a 500 04x Minimum Cash 35 0.0x Transaction Fees 100% 57,519 JOtaI USES Total (' +) Amount ($) Multiple (x) Total (%) Amount {S) MuNipte (x) Sources PUrchW£ Equity 390£ $2,937 2.5X Existing Debt Key Assumptions • No additional leverage; rolling existing debt • Illustrative closing date of Q4 2023 • 5 - year hold • Assumes exit multiple equal to entry multiple • Exit January 31, 2029 (Year - end FY28E) • Entry Multiple based on NTM EBITDA of $1.2Bn *! • NTM Exit EBITDA of $1.5Bn • Assumes Family and Liverpool roll current equity stakes $2,461 2.1x Sp‹xisor Equity • Entry premium of 40% 8K $628 0.5x Baiance Sheet casn ($23.88 / share) ‹ 1 ! 15'Iâ $1,117 0.9x Management Rollover • Min cash of $500MM $376 0.3x Liverpool Ro9over • Effective tax rate of 2796 Illustrative Sources and Uses SMM, unless otherwise noted Total Sources Entry Multiple / Target IRR Implied 5 per Share / Premium to Unaffected Share Price 1 t A 20•A Internal Rate of Return Implies a So‹ece: otal IQ as of kTach 18, 2024; Managmnt Lczig - Term Ran as of March 28, 2024 fbr yeais FY24 - 26, extnq iIati‹m thereafter 1. As of unatfeded date of I March 18, 2024 2. Net debt as of Q4 2023A; nclusive ofS2,S07MM of debt and S62B6¥ of cash Morgan Stanley Enby = Exit for 17.5 - 22.59t› IRR try Price (4.5x Entry Multiple) Denotes range on FBF 32
High Low Base Notes Assumption 4.7% 4.7% 4.7% Spot Rate on 10 - Year U.S. Treasury as of 04/25/2024 Risk Free Rate (Rt) 6.0% 6.0% 6.0% Morgan Stanley Estimated Market Risk Premium Market Risk Premium (MRP) 1.66 1.66 1.66 Predicted U.S. Local Beta per Barra Predicted Beta 1.0% (1.0%) +/ — 1.0% from Base Sensitivity Adjustment 15.6 ƒ 4 13.6 ƒ 4 14.6 ƒ 4 Calculated Using the Capital Asset Pricing MDdeI Cost of Equity (K E ) 5.2% 5.2% 5.2% Weighted Average Cost of Debt Pre - tax Cost of Debt (K D ) 27.0% 27.0% Per Management Guidance Tax Rate (t) 3.8% not - tax Cost of Debt (K D ) 5D.4% 50.4% 50.4% Based on Current Capital Structure Debt / Total Capitalization 9.7 ƒ /» 8.7% 9.2% KE “ E/(D+E) + KD “ (1 - t) ” D/(D+E) Weighted Average Cost of Capital (WACC) Key Assumptions • Cost of Equit v: Calculated using the Capital Asset Pricing Model • Risk Free Rate: Based on 10 - year U.S. Treasury aS Of current market date of April 25, 2024 • Predicted Beta: Predicted U.S. Local Beta per Barra as of unaffected date of March 18, 2024 • Cost of Debt: Norse's current blended cost of debt • Tax Rate : Implied long - term tax rate of 27 % as provided in Management's LTP • Capital Structure: Norse's debt / total capitalization ratio using unaffected market value of equity 1 ! Sowce: Company filings, Capital IQ as of unaffected date of March 18, 2024 for Beta and current as ofApnl 25, 2024 for all other market - based inputs Note: T. Debt as of D4 2023A md market value of Norse equity as of unaffected date of March 18, 2024 Morgan Stanley WACC Calculation
Unlevered Free Cash Flow Detail 2.5% wAcc Perpetuity Growth 5.0x 4.7x 4.4x $23.20 $21.70 $20.40 Rate Meth od 4.3x 4.1x 3.9x $18.30 $17.20 $16.20 3.8x 3.7x 3.5x $14.50 $13.70 $13.00 Implied Share Priee Implied Terminal LTM EBITDA Multiple Centerview Proiection Period' 1 ’ . Terminal’ 2 ’ 2028E 2027E 2026E 2025E 2024E 2023A 516,025 $16,025 $15,563 $14,635 $14,158 514,219 Net Sales $1,475 $1,475 $1,416 $1,M8 $1,281 $1,186 $1,153 EBITDA”’ (564) (640) (622) (613) (586) ( - ) Total D&A (246) (225) (215) (204) (180) (157) (13) ( - ) Taxes $665 $610 $580 $551 $488 $424 $554 NOPAT 564 571 554 538 528 517 517 (+) D&A, Net 69 67 65 85 89 69 Amort. (+) Dewloper Reimbursement (104) (104) (95) (86) (84) (84) (88) ( - ) Cash Lease Expense Adj. (15) (21) (21) (21) 42 (204) (169) ( - ) A in NWC (564) (564) (555) (546) (530) (502) (569) ( - ) Capex 5546 5561 5530 5501 5529 8240 $314 Unleve red FCF Perpetui ty Growth Rate Perpetuity Growth Rafe Source: Norse management and Wall Street research. Note: Dollars in millions, except per share amounts and where otherwise noted. Share prices rounded to nearest 80.10. Assumes valuation date and balance sheet information as of February 3, 2024. Represents fiscals years ending January. (1) (2) (3) 2024E - 2026 reflects three - year LTP reviewed with the Board in November 2023. 2027E - 2028E reflects the LTP extrapolation assuming consistent strategy and execution. Represents norma1ized depreciation & net working capital. Change in net working capital reflects midpoint of perpetuity growth rate range. EBITDA unburdened by amortization of developer reimbursements.
Unlevered Beta Debt / Debt / 1.20 1.10 1.00 0.90 0.80 Equity Cap. 13.5% 12.8% 12.2% 11.5% 10.9% 50% 33% 13.2% 12.6% 11.9% 11.3 0 / 10.7% 75% 43 0 / 13.0 0 / 12.4% 11.8% 11.1% 10.5% 100 0 / 50% 12.8% 12.2% 11.6% 11.0% 10.4% 125% 56% Equity Debt Cap. Unlevered 2 ’ Levered' 1 ’ Company 58% 3,023 5,192 1.23 1.80 Macy's 162% 4,503 2,787 0.68 1.54 Kohl's 94% $3,763 83,989 0.96 .67 Pee r Median 91% 52,937 53,220 1.19 1.98 Norse WACC Ana lysis WACC 8 ensiti vity An alysis (Pe er•Base d) Peer•Base d WACC Beta Market Debt / Risk - Free Rate(*’ Unlewred Beta*^ Debt / Equity(’ Leered Beta( 6 ’ Historical Risk Premium** Size Premium ^* Cost of Equip" Pre - Tax Cost of Debt* 1 0 * Tax Rate( 11 ’ After - Tax Cost of Debt WACC” 2 ’ D / (D+E) E / (D+E) Source: Company filings, Kroll, Bloomberg and FactSet as of April 25, 2024. Note: U.S. dollars in millions. Macy's unaffected date reflects December 8. 2023. (1) Represents two - year weekly adjusted beta (based on local index) per Bloomberg. (2) CaJculated as (Levered Beta / (1 + ((1 - Tax Rate) ” Debt/ Equity)). (3) Reflects current U.S. 20 - year treasury note yield. (4) Reflects median of unlevered betas of comparable group. (5) Reflects median peer debt / equity. (6) Reflects levering of the median unlevered beta of the peers at target debt / equity ratio. Levered Beta = (Unlevered Beta) “ (1 + (1 - Tax Rate) ” (Debt / Equity)). (7) Reflects U.S. Long - Horizon Equity Risk Premium per Kroll. (8) Reflects size premium per Kroll Valuation Handbook. (9) Calculated as Risk - Free Rate + {Historical Risk Premium ” Levered Beta) + Size Premium. (10) Assumes illustrative cost of debt based on trading yields of Norse's and Macy's bonds prior to takeover rumors. (11) Reflects Norse management long - term tax rate. (12) WACC equals ((Debt/Capita1ization) ”ARer - Tax Cost of Debt) + (Equity/Capitalization ” Levered Cost of Equity)). Centerview 4.88% 0.96 94.3% 1.61 7.17% 0.95% 17.4% 7.25% 27.0% 5.3% 11.5^/» 48.5% 51.5% 35
Selected Department Store Peers Corrgany Kohl's Peer Median Current Centerview Share Price % of 52 - M‹. High Market Cap Aggregate Value AV/ Arli. EBIT DA" 2023A 2024E 2025E '23A - '25E CAGR Net Sales EBITDA"’ EBIT Margin EPS 2023A 2024E Gross Net Leverage”’ Leverage *’ 24.28 (17.3%) 2,787 7,107 4.8x 5.0x 5.0x 0.6% 4.0x 43x 4.3x 0.1•A Unaffected 1.2x 1.4x 4.7% 6.1 ƒ 4 (13.5%) (7.9 ƒ 4) (0.5 ƒ A) 3.6x 3.6x 3.1x $7,139 $5,192 (14.8%) $18.35 3.0x 3.1x 4.0% 4.3 ƒ 4 (3.8%) (1.3%) 2.1x k3x 43•/. 5.2•/. (8.7•/.) (4.6•/.) 2.0x 6x 3.5•/. 4.0•/. (3J•/.) (1.2•/.) Norse (Cons.) $19.00 (18.5•t) 3,220 5,529 4.8x 5.0x 4.9x 2.5•/. 2.0x 6x 4.1•/. 4.0•/. (3J•/.) 5.4•/. 1.SY. 4.3x 47x 4.8x 5,529 3,220 (18.5•/.) Norse (Mgrrd.) $19.00 6x 3.5•/. 4.0•A ( 2•/.) (1.2•/.) 2.5•/. Norse (Cons.) $17.06 (26.8•t,) 2,891 5,200 4.5x 47x 4.6z 2.0x Z.6x 4.1•/. 4.0•/. (3J•/.) I 4•/. 1.5•/. 4.1x 44z 4.5x 5,200 2,891 (26.8•/.) $17.06 Norse (Mgrrd.) Source Norse Management, company filings and FactSet as of April 25, 2024. Note. Dollars in millions except per share figures. [1) Norse LTP EBITDA figures add back amortization of developer reimbursement for comparison to consensus EBITDA. (2) Oebt figures do not include leases and LTM EBITDA does not add back rent. (3) Norse figures as of unaffected date of March 18, 2024.
Selected U.S. Department Store Transactions AV/ LTM AV / LTM Aggregate EBITDA Revenue Value Acquiror Target Date 6.3x 0.68x $2.8 Sycamore Partners Belk Aug - 15 9.1x 1.31x 6.1 CPPIB & / res Neiman Marcus Sep - 13 10.9x 0.91x 2.9 HBC Saks Jul - 13 9.1x 0.91x 2.9 Median 8.8x 0.97x 3.9 Average Source.Companyflngs, FadSetandWal8‹ietxsearch. Note. DoZaminbiWons Centerview 37
AV / NTM EBITDA Multiple Since 2013 10.0x 9.0x 8.0x 7.1x 7.0x 6.0x 4.0x HBC / Saks announced Sept. 9, 2013: Neiman announced Sept. 24, 2015: Sycamore / Belk announced 3.0x Pre - COVID Avg.( 1 Kohl's 5.5x Norse 6.8x 4.7x Macj/'s 5.8x 3.5x Centerview 5.0x (29%} 2.0x Jan - 13 Jan - 14 Jan - 15 Jan - 16 Jan - 17 Jan - 18 Jan - 19 Jan - 20 Jan - 21 Jan - 22 Jan - 23 Jan - 24 Source: Company fi1ings and FactSet as of April 25, 2024. Note. AV / NTM EBITDA multiple smoothed in mid - 2020 to adjust for COVID distortions. (1) Pre - COV1D period includes January 2013 through February 2020 (2) Post - COVlD penod includes July 2021 through current. (3) Norse multiple reflects unaffected multiple as of March 18, 2024 and Macy's multiple reflects unaffected multiple as of December 8, 2023. Norse Macy's Kohl's
DtscTos ed Val uatton 0 eza II s Date P r1oe 1 avget Discounted Cash Flow 3/28/2024 $38.50 Buy Morningstar "’ Forward P/E trading multiple 3/31/2024 $24.00 Buy KeyBanc 11.0x FY2025 P / E 3/25/2024 42200 Hold TD Cowen - 5.0x FY2024 AV / EBITDA 3/6/2024 $20.00 Hold Cir - 10.0x FY2024 EPS T5/2024 $20.00 Hold BMO 9.5x 2025E EPS 4/19/2024 41900 Hold Telsey NA 3/5/2024 $18.00 Hold Goldman Sachs Forward P / E tmding multiple 3/14/2024 $17.00 Hold Jefferies 9.0x FY2025 EPS 3/6/2024 41Z00 Hold Evercore Forward P / E tmding multiple 4/3/2024 $17.00 Hold Gordon Haskett 4.0x FY2024 AV / EBITDA 3/6/2024 $1500 Sell JP Morgan 7.0x NTM P / E multiple based on CY2025 EPS T5/2024 $15.00 Sell Barclays 4.0x FY2024 AV / EBITDA 3/6/2024 41500 Sell Bank of America 7.0x Forward P / E 3/6/2024 $13.00 Sell Morgan Stanley — 0.2x FY2D26 AV / Sales 3/7/2024 $12.00 Sell UBS NA 3/6/2024 NA Hold William Blair NA 3/6/2024 NA Hold Guggenheim 517.00 Median Mean Analyst price targets in - line with unaffected Norse share price of 617. 06 and below current share price of 819. 00 Source: Wall Street Equity Research, Market Data as of April 25, 2024. (1) Morningstar Price Target excluded from Median and Mean calculations. Centerview 39
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW © Morgan Stanley and/or certain of its affiliates. All rights reserved. 40 We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. 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PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 41 LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit (c)(viii)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW PROJECT NORSE UPDATE JUNE 15, 2024
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 2 EXECUTIVE SUMMARY • On March 19, 2024, Reuters reported that the Norse Family was seeking to take the Company private – Following the report, Norse’s stock experienced +9% 1 - day and +18% 3 - day price increases – Consequently, the pre - report price of $17.06 as of March 18th has been referenced as the “unaffected” share price • Typically, the “unaffected” price is referenced to evaluate offers, however, at the request of the Board, we have considered illustrative approaches to estimate an “adjusted unaffected” price to account for the stock’s recent performance independent of deal speculation • In contemplating the “adjusted unaffected” price, we have considered a variety of approaches and factors, including: Morgan Stanley – Norse’s share price reaction post Q1 2024 earnings – Evolution of Analyst price targets post earnings – Change in peers’ share price since the unaffected date – Norse’s long - term average multiple Centerview Norse’s 3 - day share price reaction to: – Macy’s transaction rumors – Norse takeover leak – Sycamore interest leak – Q1 2024 earnings • Based on our analyses, while stile maintaining the previous “unaffected” price of $17.06, we estimate the following illustrative “adjusted unaffected” share price ranges: – Morgan Stanley: $15.41 – $19.07 – Centerview: $16.13 – $18.54
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW (4) Off - Price Retail Kohl's Macy's Current (3) Macy's Unaffected (12/8/2023) (2) Norse Current Norse Unaffected (1) (3/18/2024) 35.7% (3.9%) 19.6% (24.3%) 6.5% 3.0% L1Y ∆ 86.8% (44.4%) (9.2%) (36.4%) (13.6%) (36.5%) L2Y ∆ 21.1% (58.9%) (1.0%) 51.0% (39.0%) (59.9%) L3Y ∆ 46.9% (53.1%) (10.2%) (45.1%) (33.0%) (61.4%) L5Y ∆ Share Price Performance Over Time (1) Indexed to 100; Since June 12, 2019 Source: Capital IQ Notes: 1. Represents Norse as of unaffected date March 18, 2024 2. Market data as of June 12, 2024 3. Represents Macy’s as of unaffected date December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL SECTOR SHARE PRICE PERFORMANCE OVER TIME Post Norse Unaffected Period To Current May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; Share Price increased +5.1% day after earnings March 18, 2024: Norse unaffected share price of $17.06 January 22, 2024: Macy’s announces it will not enter into an agreement with Arkhouse and Brigade December 8, 2023: Macy’s unaffected share price of $17.39 0 3 50 100 150 200 Jun - 19 Dec - 19 Jun - 20 Dec - 20 Jun - 21 Dec - 21 Jun - 22 Dec - 22 Jun - 23 Dec - 23 Jun - 24 (33.0%) (53.1%) (10.2%)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW $17.39 $20.77 $18.26 $18.63 $19.26 $19.95 $21.50 $20.19 $20.08 $20.45 – 20.0 40.0 60.0 80.0 10 15 20 25 12/7 1/2 1/12 1/25 2/6 2/16 2/29 3/12 3/22 4/4 4/16 4/26 5/8 5/20 5/31 6/12 +10.8% $19.26 MACY’S SHARE PRICE SINCE TAKEOVER RUMORS BEGAN Share Price Performance and Trading Volume Over Time (1) Since December 8, 2023 Share Price ($) 30 Macy’s Volume (MM) January 22, 2024: Macy’s announces it will not enter into an agreement with Arkhouse and Brigade December 10, 2023: Arkhouse Management and Brigade Capital offer of $21 per share (2) in a potential take - private transaction for Macy’s Volume (MM) 12/8 12/19 Source: Capital IQ Note: 1. Market data as of as June 12, 2024 December 8, 2023: Unaffected date February 27, 2024: Macy’s reports Q4 FY2023 earnings, beats on consensus revenue and EPS, and announces a plan to close ~150 stores February 20, 2024: Arkhouse launches proxy fight by nominating 9 directors to Macy’s board February 2, 2024: Tony Springs is named Chief Executive Officer and Chair - Elect effective February 4, 2024 March 14, 2024: Macy’s and investment group in discussion for due diligence on the prospects of a higher offer March 4, 2024: Arkhouse and Brigade, alongside Fortress Investment and One Investment, raise offer to acquire Macy’s to $24 per share (3) April 10, 2024: Macy’s settles proxy fight with Arkhouse and appoints two of the firm’s nominees to Board of Directors May 21, 2024: Macy’s reports Q1 FY2024 earnings. Beats on consensus revenue and EPS estimates, and raised profit forecast for FY2024 2. Represents a $5.8Bn valuation 3. Represents a $6.6Bn valuation 4 Average Volume: 7.8MM +19.4% Share Price Performance from takeover rumor announcement (12/11/2023) to unaffected (12/8/2023) +10.8% Share Price Performance since takeover rumors began (12/8/2023) to current (10.4%) Share Price Performance since peak speculation (3/14/2024) to current (4.6%) Share Price Performance since after settlement with Arkhouse (4/10/2024) to current
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW (4) Macy's Unaffected (3) (2) Norse Unaffected (1) Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 15.4x 5.6x 3.7x 3.7x 5.2x 4.7x Today 14.4x 5.2x 3.3x 3.1x 5.2x 4.4x L1Y Avg. 13.8x 5.1x 3.3x 3.2x 5.1x 4.4x L2Y Avg. 13.6x 4.9x 3.5x 3.8x 4.9x 5.0x L3Y Avg. 14.6x 5.0x 4.4x 4.5x 5.2x 5.2x L5Y Avg. Since June 12, 2019 Source: Capital IQ Notes: 1. Represents Norse as of unaffected date March 18, 2024 2. Market data as of June 12, 2024 AV / NTM EBITDA Over Time (1) SECTOR VALUATION MULTIPLES OVER TIME Post Norse Unaffected Period To Current November 17, 2022: Kohl’s announces they will not engage in transformative transactions; multiple of 5.6x January 21, 2022: Kohl’s unaffected multiple of 4.0x January 24, 2022: News of takeover offer; Kohl’s affected multiple of 5.1x December 8, 2023: Macy’s unaffected multiple of 3.7x May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; multiple of 5.1x March 18, 2024: Norse unaffected multiple of 4.7x 2.0x 0.0x 3. Represents Macy’s as of unaffected date December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL 5 6.0x 8.0x 10.0x 12.0x Jun - 19 Dec - 19 Jun - 20 Dec - 20 Jun - 21 Dec - 21 Jun - 22 Dec - 22 Jun - 23 Dec - 23 Jun - 24 5.6x 5.2x 3.7x 4.8x 4.7x 4.5x 4.0x 4.4x Norse L1Y Average Unaffected Multiple
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW NORSE’S SHARE PRICE SINCE UNAFFECTED DATE Share Price Performance and Trading Volume Over Time (1) Since March 18, 2024 Norse Volume (MM) Source: Capital IQ Note: April 18, 2024: Erik and Pete Nordstrom file Schedule 13D; Announce formation of Special Committee May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket. Beats on consensus revenue estimates, misses on EPS, and reaffirms guidance May 2, 2024: Rumors of Sycamore Partners’ participation on potential take - private transaction Average Volume: 3.4MM Norse Macy’s Kohl’s $17.06 $18.66 $18.74 $19.98 $21.03 $21.53 – 5.0 15.0 20.0 Volume (MM) 10 15 20 25 30 Share Price ($) 35 3/15 3/21 3/27 4/3 4/9 4/15 4/19 4/25 5/1 5/7 5/13 5/17 5/23 5/30 6/5 6/11 (10.1%) 10.0 +26.2% (9.3%) March 19, 2024: Reuters report of Norse’s potential take - private (9.7%) Average M and KSS Share Price Performance from Unaffected to Current +2.4% Norse Share Price Performance from Q1 Release to Current March 18, 2024: Unaffected date 3/18 1. Market data as of as June 12, 2024 6
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 7 % Change (1) Post - Earnings (5) Pre - Earnings Firm Name - $38.50 $38.50 Morningstar - $24.00 $24.00 KeyBanc - $22.00 $22.00 TD Cowen - $20.00 $20.00 Citi - $20.00 $20.00 BMO - $19.00 $19.00 Telsey +5.6% $19.00 $18.00 Goldman Sachs +5.9% $18.00 $17.00 Jefferies +11.8% $19.00 $17.00 Evercore +11.8% $19.00 $17.00 Gordon Haskett - $17.00 $17.00 JP Morgan +20.0% $18.00 $15.00 Barclays +20.0% $18.00 $15.00 Bank of America - $12.00 $12.00 UBS +11.8% $19.00 $17.00 Median (3) +5.2% $18.85 $17.92 Mean (3) MEDIAN PRICE TARGETS INCREASED 11.8% POST - EARNINGS Source: Wall Street Equity Research Note: 1. Market Data as of June 12, 2024 2. Includes William Blair and Guggenheim 3. Morningstar Price Target excluded from Median and Mean calculations 4. Market Data as of March 18, 2024 5. Represents price target as of May 17, 2024 $17.00 $19.00 Pre - Earnings Post - Earnings Unaffected Share Price (4) Current Share Price (1) Buy 12% Hold 63% Sell 25% Current Analyst Ratings (1)(2) Median Price Target ($) (3) Analyst Price Targets $21.53 $17.06
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 8 POTENTIAL DRIVERS OF SHARE PRICE CHANGE Other Fundamental Factors Department Store Peer Performance ▪ Mixed earnings from Department store peers, with Macy’s outperforming Street expectations and raising guidance ▪ Meanwhile Kohl’s saw disappointing topline and earnings results and significant downward revision of guidance ▪ Capital allocation, strategic pivots, etc. Change in Norse Valuation Factors Topline / Growth EBIT Margin Macro Environment / Industry Sentiment ▪ Continuation of recent trends, including elevated levels of inflation and higher interest rates ▪ U.S. interest rates expected to remain higher for longer ▪ Improvement in growth outlook, partially driven by strength of Q1’24 earnings led by Rack performance ▪ Margin outlook down due to risks from Q2 - Q4 2024 profitability ramp embedded in guidance Terminal Trajectory ▪ Difficult to believe perpetuity assumptions have changed following one quarter of performance ? Potential Drivers of Share Price Change Considerations Change in Perception Since 3/18 Rumor Change in Norse Earnings ▪ Earnings outlook largely unchanged and unlikely to affect Norse valuation ▪ Between the unaffected date of March 18 th and current, 2024E and 2025E Adj. EPS estimates are (2.3%) and +0.3% , respectively Source: FactSet as of June 12, 2024. Potential Multiple Drivers
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 9 $17.06 $15.41 $16.01 $17.47 $19.07 $16.35 $16.13 $18.54 $18.32 Unaffected Share Price (1) Peer Share Price Perf. (Unaffected - Current) 1YR Average Mul ( t 1 i ) ple Share Price Perf. (Q1 Release - Current) Change in Analyst Price Targets Share Price Pre - Macy's Rumor Cumulative Share Price “Bump” Adjustment (4) Takeover Leak Share Price “Bump” Adjustment Q1’24 Earnings Adjustment ILLUSTRATIVE “ADJUSTED UNAFFECTED” PRICE METHODOLOGIES 4.8x (2) 4.8x (2) 4.4x (2) 4.5x (2) 4.9x (2) 4.6x (2) 4.4x (2) 4.3x (2) 4.7x Implied AV / NTM EBITDA Q1 earnings 3 - day share price reaction (3) Current share price less the takeover leak 3 - day share price reaction Current share price less the cumulative price increases due to transaction news Share price prior to Macy’s takeover rumor (12/8/23) % change of median price target from pre Q1 release to post Q1 release (3) Share price performance from Q1 release (5/30/24) to current (3) 1 - year average unaffected multiple Avg. % change in peer share prices from 3/18/24 to current (3) Unaffected share price ( 3 / 18 / 2024 ) Methodology +$1.26 ($2.99) ($5.40) - - +11.8% +2.4% 4.4x NTM EBITDA (9.7%) M: (9.3%) KSS: (10.1%) - - Relevant Metric Illustrative “Adjusted Unaffected” Share Price ($) Source: Capital IQ as of June 12, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Norse FDSO and net debt as of Q1 2024A; inclusive of $2,689MM in debt and $428MM in cash and equivalents, and NTM EBITDA of $1,127MM 3. Applied to Norse unaffected share price or multiple 4. Reflects current price of $21.53 less the difference between the 3 - day share price reactions to the various takeover news, including Macy’s Rumor: $0.95, Initial Norse Takeover Leak: $2.99, and Sycamore Interest Leak: $1.46, totaling a ($5.40) adjustment Morgan Stanley Centerview
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 10 APPENDIX SUPPLEMENTAL MATERIALS
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW NORSE’S SHARE PRICE DISTRIBUTION $16.91 $18.66 $17.52 $19.76 $21.23 $21.52 16 15 14 13 12 17 18 19 20 21 Distribution of Norse’s Stock Price Movements from One Year from Unaffected Date to Current (1)(2) ($) 24 23 22 29 - Jan - 17 30 - Jan - 17 31 - Jan - 17 1 - Feb - 17 2 - Feb - 17 3 - Feb - 17 Median Current Price (6/12/2024) Source: Capital IQ Notes: 1. Market data as of as June 12, 2024 2. Black shading represents 25th to 75th percentile range and gray line represents share price range over each period Unaffected Price (3/18/2024) L1Y to Unaffected (3/18/23 – 3/18/24) Beginning of Year to Unaffected (1/2/24 – 3/18/24) FY’23 Earnings to Unaffected (3/5/24 – 3/18/24) Unaffected to Q1’24 Earnings Sycamore Partners Article to Q1’24 Earnings (3/18/24 – 5/30/24) (5/2/24 – 5/30/24) Q1’24 Earnings to Current (5/30/24 – 6/10/24) 11 $17.06 $21.53
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 17% 5% 17% 2% 18% 5% 32% 2% 19% 6% 28% 2% 24% 14% 34% 3% 1 2 3 4 ADTV as a % of Float ADTV as a % of Float L3M ADTV ($MM) L3M ADTV ($MM) Mar. 18, 2024 Short Interest Level Current Short Interest Level Short Interest Variance Pre - Mar. 18, 2024 Pre - Mar. 18, 2024 Norse Short Interest and Liquidity In - Line With its Peers ASSESSING NORSE STOCK TECHNICALS RELATIVE TO PEERS $64 $102 $146 $390 $84 $140 $309 3% 2% 6% 1% 4% 3% $163 5% 1% Norse Macy's Kohl's Off - Price Retailers 10.0% Short Interest (LTM) (1)(2) % Equity Float 26.0% 24.0% 22.0% 20.0% 18.0% 16.0% 14.0% 12.0% May - 23 Jun - 23 Jul - 23 Aug - 23 Sep - 23 Oct - 23 Nov - 23 Dec - 23 Jan - 24 Feb - 24 Mar - 24 Apr - 24 May - 24 Norse Short Interest vs. Peers (LTM) (1)(2)(3) % Equity Float; Levels at Each Peer’s 52 - Week Low and High Sources: Bloomberg, Capital IQ Notes: 1. As of June 12, 2024 2. Short Interest is available bi - weekly and latest available data is 5/30/2024 18.5% / 18MM Shares March 28: Short Interest for prior two weeks released Norse Liquidity Dynamics vs. Peers (LTM) (1)(3) L3M ADTV (USD / $MM) / as % Float Norse Macy’s Kohl’s Off - Price Retailers 3. Off - Price Retailers include ROST, TJX and BURL 12
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 13 1.0% 1.5% 0.8% 1.5% (1.2%) 0.6% (1.0%) 5.4% (1.2%) 5.4% (3.9%) (4.3%) 3.5% 4.0% 3.5% 4.0% 3.3% 4.7% 7.4% 8.1% 7.5% 8.1% 8.1% 8.6% 5.4x 5.0x 4.7x 4.4x 5.4x 3.9x 5.2x 4.6x 4.6x 4.1x 5.2x 3.9x 11.8x 11.2x 9.4x 8.8x 14.9x 6.3x NORSE’S MANAGEMENT LONG - TERM PLAN IS AHEAD OF CONSENSUS REVENUE AND PROFITABILITY EXPECTATIONS 10.1x 8.8x 8.6x 7.5x 11.0x 6.3x CY2025E P / E (x) CY2024E P / E (x) CY2025E AV / EBITDA (x) (1)(2) CY2024E AV / EBITDA (x) (1)(2) CY2024E EBITDA Margin (%) (1) CY2024E EBIT Margin (%) CY’23A – CY’25E EBITDA CAGR (%) (1) CY’23A – CY’25E Revenue CAGR (%) Source: Capital IQ as of June 12, 2024; Management Long - Term Plan as of March 28, 2024 Notes: 1. Norse figures adds back all depreciation and amortization, including amortization of developer reimbursements 2. Norse FDSO and net debt as of Q1 2024A; inclusive of $2,689MM in debt and $428MM in cash and equivalents 3. Base - line Long - Term Plan multiples assumes current / unaffected date AV and share price 4. Represents Norse as of unaffected date of March 18, 2024 5. Represents Macy’s as of unaffected date of December 8, 2023 Norse Current Consensus (5) Norse Current Management LTP (3) Norse Unaffected Consensus (4) Norse Unaffected Management LTP (3)(4)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 14 FQ12024 FQ42023 FQ32023 FQ22023 FQ12023 FQ42022 FQ32022 FQ22022 FQ12022 5/30/24 3/5/24 11/21/23 8/24/23 5/31/23 3/2/23 11/22/22 8/23/22 ($MM) 5/24/22 3,211 4,375 3,406 3,657 3,113 4,330 3,465 3,968 Revenue Consensus 3,264 3,335 4,420 3,320 3,772 3,181 4,319 3,546 4,095 Revenue Actual 3,569 Beat Beat Miss Beat Beat Miss Beat Beat Beat / Miss Beat ($0.08) $0.86 $0.12 $0.46 ($0.12) $0.66 $0.13 $0.80 ($0.06) EPS Consensus ($0.24) $0.96 $0.25 $0.84 $0.07 $0.74 $0.20 $0.81 ($0.06) EPS Actual Miss Beat Beat Beat Beat Beat Beat Beat NA Beat / Miss Guidance Raised Reduced Reaffirm Provided Reaffirm Reaffirm Reaffirm Provided Reaffirm 1 - Day Share Price Reaction 14.0% (20.0%) (4.2%) 2.4% 4.7% (7.7%) (4.6%) (16.1%) 5.1% Source : Capital IQ as of June 12, 2024, Company Filings NORSE’S SHARE PRICE APPEARS TO BE MORE REACTIVE TO GUIDANCE CHANGES THAN EARNINGS RESULTS
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 15 Source: Company filings and FactSet as of June 12, 2024. Note: Post Q2’23, Post Q3’23, Post Q4’23 and Post Q1’24 / Current represent consensus figures taken as of September 17, 2023, December 5, 2023, March 17, 2024 and June 12, 2024, respectively. NORSE CONSENSUS ESTIMATES OVER TIME Revenue ($bn) Adj. EBIT ($mm) EPS Post Q2’23 Post Q3’23 Post Q4’23 / Pre - Takeover Leak Post Q1’24 / Current % Change in Estimates 2024E % YoY Growth $14.4 $14.4 $14.2 $14.3 $14.3 $14.4 $14.4 $14.5 2025E (1.3%) +0.4% +0.8% (0.7%) +0.6% +0.9% +0.5% +0.2% +0.9% +1.0% +1.1% +1.1% +0.3% +0.0% 2024E % Margin 3.9% 4.1% 3.8% 3.6% 3.6% 3.5% 3.5% 3.8% 2024E % YoY Growth (0.9%) +2.5% (3.5%) +3.5% +6.2% (15.5%) (13.5%) (4.9%) $563 $593 $542 $552 $506 $507 $520 $528 2025E $2.01 $2.06 $1.94 $1.87 $1.83 $1.79 $1.90 $1.90 2025E (3.8%) (6.6%) +0.3% (7.1%) (5.8%) +1.5% (3.5%) (5.3%) (2.3%) (9.2%) +1.5% +0.3% +0.7% +0.9% (0.4%) (0.5%) (14.6%) +3.7% Δ Δ Δ Top - line growth expectations have accelerated over past year, while profitability dollars and margin have deteriorated
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW ($0.08) ($0.24) (21) Actual Consensus Actual 6 Consensus Actual Consensus 3,211 3,335 STREET VIEWS OF Q1 EARNINGS WERE LARGELY BALANCED • Revenue beat demonstrates ability to deliver on top line with room to further improve and recover on margins • Continued momentum of Rack comp sales and positive inflection in full - price shows the resilience of Norse’s consumer • Adjusted EBIT miss raises further concerns on declining department store margins, largely driven by channel shift to lower margin E - Commerce sales • Q1 margin pressure from timing and operational headwinds raises uncertainty around long - term ability to improve margins, despite some early signs of stabilization and expected reversal for the remainder of the year • Full year guidance reaffirmed, with revenue largely viewed as conservative and potential questions around margins given Q1 results Q1 2024 Revenue ($MM) Q1 2024 Adj. EBIT ($MM) Q1 2024 Adj. EPS ($) +3.9% Source: Wall Street Equity Research, Capital IQ as of June 12, 2024 Analyst Perspectives on Q1 2024 Earnings 16
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW PERSPECTIVES ON NORSE FOLLOWING Q1 2024 EARNINGS Bull Case Bear Case + Sustained acceleration of the Nordstrom Rack banner + Digital growth re - accelerates + Greater margin recapture than expected after freight and product cost headwinds reversed + Proposed credit card late fee regulations are delayed + Further resurgence of event and occasion - based dressing + Broad improvement in consumer environment 17 – Slower growth at full - line stores persist – Lower productivity at new Rack locations – Larger markdowns required as the environment remains highly promotional – Elevated levels of shrinkage become the norm – Inventory targets to increase choice prove overly burdensome and create inventory management issues – Increasing costs associated with growing digital Source: Wall Street Equity Research
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 18 Estimated Cost Basis ($) Position Value ($MM) (2) Last Position Change ('000s) Current Position % of TSO Current Position ('000s) Institution Type Investor (1) # $18.70 $339.2 - - 9.6% 15,755 Corporation El Puerto de Liverpool SAB de CV 1 $28.15 $229.4 579 6.5% 10,653 Investment Advisor Vanguard Group Inc 2 $28.77 $190.9 (921) 5.4% 8,867 Investment Advisor BlackRock Inc 3 $21.55 $178.7 - - 5.1% 8,302 Investment Advisor State Street Corp 4 $18.41 $94.1 4,009 2.7% 4,369 Hedge Fund Manager Cooper Creek Partners Management L 5 $19.50 $84.6 (1,311) 2.4% 3,931 Investment Advisor Schroders PLC 6 $16.29 $71.4 26 2.0% 3,314 Investment Advisor Victory Capital Management Inc 7 $19.82 $64.6 170 1.8% 3,000 Investment Advisor Dimensional Fund Advisors LP 8 $16.69 $47.1 (473) 1.3% 2,187 Hedge Fund Manager Two Sigma Investments LP 9 $20.17 $43.2 1,212 1.2% 2,005 Investment Advisor Invesco Ltd 10 $21.78 $41.2 (102) 1.2% 1,913 Brokerage Morgan Stanley 11 $15.16 $39.5 (1,590) 1.1% 1,834 Hedge Fund Manager Citadel Advisors LLC 12 $17.42 $38.9 1,258 1.1% 1,806 Hedge Fund Manager Voloridge Investment Management LL 13 $18.45 $35.6 1,653 1.0% 1,653 Hedge Fund Manager Balyasny Asset Management LP 14 $26.95 $35.5 72 1.0% 1,650 Investment Advisor Geode Capital Management LLC 15 $18.96 $35.1 511 1.0% 1,629 Hedge Fund Manager AQR Capital Management LLC 16 $26.31 $35.0 (48) 1.0% 1,627 Investment Advisor Bank of New York Mellon Corp 17 $22.31 $32.8 (23) 0.9% 1,522 Investment Advisor LSV Asset Management 18 $20.17 $30.1 9 0.9% 1,398 Corporation Art Group Services Ltd 19 $18.45 $29.4 1,367 0.8% 1,367 Hedge Fund Manager Point72 Asset Management LP 20 $19.12 $29.1 (53) 0.8% 1,352 Investment Advisor Franklin Resources Inc 21 $22.15 $27.5 312 0.8% 1,278 Bank Norges Bank 22 $26.66 $26.4 (16) 0.7% 1,227 Hedge Fund Manager Douglas Lane & Associates LLC 23 $18.42 $23.0 1,047 0.7% 1,069 Hedge Fund Manager MARSHALL WACE 24 $16.77 $21.5 151 0.6% 999 Investment Advisor American Century Cos Inc 25 $28.32 $20.7 37 0.6% 961 Brokerage Charles Schwab Corp 26 $15.05 $20.1 (1,580) 0.6% 933 Hedge Fund Manager Millennium Management LLC/NY 27 $14.99 $17.2 1 0.5% 798 Hedge Fund Manager Pathstone Holdings LLC 28 $17.59 $17.1 (0) 0.5% 794 Investment Advisor WisdomTree Inc 29 $26.40 $16.4 - - 0.5% 760 Investment Advisor Capital Group Cos Inc 30 $21.62 $1,915.2 54.4% 88,954 Total Top 30 Investors Weighted Average Cost Basis As of Q1 2024 NORSE COST BASIS Source: Bloomberg Notes: 1. Excludes insiders 2. Market data as of June 12, 2024
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 0.0 15.8 15.8 15.8 15.8 15.8 15.8 15.8 9.6% Other Mexico City - El Puerto de Liverpool SAB de CV 10.3 10.4 9.4 10.1 10.1 10.0 10.1 10.6 6.5% Index Malvern $7,174 The Vanguard Group 8.7 8.6 9.1 9.1 9.1 8.3 8.0 8.1 4.9% Index San Francisco $3,797 BlackRock Institutional Trust 4.3 4.4 4.6 5.1 8.6 8.5 8.3 8.0 4.9% Index Boston $2,165 State Street Global Advisors 0.0 2.0 0.0 3.2 2.7 3.9 0.4 4.4 2.7% Hedge Fund New York $2 Cooper Creek Partners Management LLC 0.0 0.3 0.3 0.3 1.6 2.3 3.3 3.3 2.0% Growth Brooklyn $113 Victory Capital Management 1.2 1.5 1.6 1.7 1.7 1.7 2.8 3.0 1.8% Quant Austin $559 Dimensional Fund Advisors 6.4 2.5 1.4 0.5 2.4 1.7 2.7 2.2 1.3% Quant New York $85 Two Sigma Investments 1.4 1.7 1.7 1.6 1.6 1.8 2.6 2.1 1.3% Growth London $168 Schroder Investment Management 0.4 0.5 0.8 0.7 0.5 0.6 0.7 1.9 1.1% Index Chicago $202 Invesco Capital Management 3.2 0.8 0.0 0.0 2.3 0.6 3.4 1.8 1.1% Hedge Fund Chicago $97 Citadel Advisors 0.5 0.6 0.0 0.0 0.3 0.1 0.5 1.8 1.1% Hedge Fund Jupiter $25 Voloridge Investment Management 1.3 2.2 0.0 1.2 1.9 0.0 0.0 1.7 1.0% Hedge Fund Chicago $35 Balyasny Asset Management 1.4 1.4 1.5 1.5 1.7 1.5 1.6 1.7 1.0% Index Boston $1,249 Geode Capital Management 0.5 1.1 1.2 1.3 1.2 1.5 1.1 1.6 1.0% Quant Greenwich $58 AQR Capital Management 0.6 0.8 1.3 1.4 1.4 1.3 1.5 1.5 0.9% Quant Chicago $54 LSV Asset Management 0.0 0.8 0.0 1.8 0.3 0.1 0.0 1.4 0.8% Hedge Fund Stamford $35 Point72 Asset Management 2.6 0.9 0.9 1.0 1.0 1.0 1.3 1.3 0.8% Value Oslo $1,101 Norges Bank Investment Management 0.6 0.6 1.2 1.2 1.1 1.1 1.2 1.2 0.8% GARP Boston $269 Mellon Investments 5.5 1.7 0.1 0.5 0.0 0.1 0.0 1.1 0.7% Hedge Fund London $52 Marshall Wace 0.0 0.0 0.0 0.3 0.4 0.4 0.8 1.0 0.6% Growth Kansas City $186 American Century 0.8 0.8 0.8 0.8 0.9 0.8 0.9 1.0 0.6% Index San Francisco $518 Charles Schwab Investment Management 0.1 1.0 0.1 0.2 0.0 0.0 2.5 0.9 0.6% Hedge Fund New York $108 Millennium Management 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.6% Individual - - Nordstrom (James F Jr.) 0.8 0.8 0.6 0.5 0.2 1.2 1.0 0.9 0.6% Other New York $206 Morgan Stanley & Co. 99.3 109.9 101.2 108.4 115.3 112.8 119.1 126.5 77.3% Top 30 Total Investor Equity AUM ($Bn) 4Q'22 3Q'22 2Q'22 Position in Shares (MM) 3Q'23 2Q'23 1Q'23 25.2 25.2 25.2 Nordstrom (Bruce A) - 25.2 25.2 25.2 Gittinger (Anne E) - - Individual 9.4% 15.4 15.4 15.4 15.4 15.4 15.4 15.4 15.4 Nordstrom (Erik B) - - Individual 1.8% 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 Nordstrom (Peter E) - - Individual 1.7% 2.8 2.8 2.8 2.8 2.8 2.8 2.8 2.8 Douglas C. Lane & Associates $7 New York GARP 0.7% 1.2 1.2 1.3 1.3 1.3 1.4 1.4 1.4 Sources: Thomson Eikon Notes: 1. Shown values of zero represent holdings of less than 0.05MM shares As of 1Q’24 (1)(2) EVOLUTION OF NORSE’S PUBLIC INVESTOR BASE Top 10 1Q’24 Buyers (1) Top 10 1Q’24 Sellers (1) Top 30 Holders as of 1Q’24 (1)(2) % City Style TSO 1Q'24 4Q'23 - Individual 15.4% 25.2 25.2 Decrease in ownership by ≥ 5% Increase in ownership by ≥ 5% 19 Investor Style Pos. Δ (%) Pos. Δ (Shares) - 1,590,282 - 46% Hedge Fund Citadel Advisors - 1,580,253 - 63% Hedge Fund Millennium Management - 814,675 - 86% Other BNP Paribas Securities - 558,829 Full Exit Quant Trexquant Investment LP - 535,398 - 20% Growth Schroder Investment Management - 529,179 - 98% Other Susquehanna International Group - 511,500 Full Exit Value Ostrum Asset Management - 496,409 Full Exit Growth BNP Paribas Asset Management (France) - 473,182 - 18% Quant Two Sigma Investments - 382,013 - 76% Other Barclays Bank - 7,471,720 Top 10 Total Investor Style Pos. Δ (%) Pos. Δ (Shares) +4,009,403 +1,114% Hedge Fund Cooper Creek Partners Management LLC +1,652,701 New Pos. Hedge Fund Balyasny Asset Management +1,367,277 New Pos. Hedge Fund Point72 Asset Management +1,257,763 +230% Hedge Fund Voloridge Investment Management +1,190,196 +176% Index Invesco Capital Management +1,046,862 +4,673% Hedge Fund Marshall Wace +664,720 New Pos. Hedge Fund Squarepoint Capital +579,001 +6% Index The Vanguard Group +545,702 New Pos. Hedge Fund Scopus Asset Management, L.P. +511,281 +46% Quant AQR Capital Management +12,824,906 Top 10 Total
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PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 21 LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit
16(c)(ix)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW PROJECT NORSE UPDATE SEPTEMBER 11, 2024
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 2 SITUATION UPDATE ▪ Throughout 2023, at the request of the Norse Board of Directors, management worked with Morgan Stanley and Centerview Partners to independently evaluate value creation potential across a number of different scenarios ▪ On February 11 th , 2024, the Special Committee was formed to oversee the process to explore a potential take - private transaction following interest expressed by Erik and Pete Nordstrom in submitting a proposal ▪ On June 19 th , the Special Committee of the Board of Directors shared a process letter with E&P if they were to submit a proposal – Since then, the Special Committee and its advisors have continuously facilitated diligence with E&P and a number of potential equity partners ▪ On September 4 th , the Special Committee received a non - binding written proposal for a potential acquisition of the Company from a group comprised of E&P and Liverpool, together the Bid Group – Offer to acquire the common stock of the Company for a cash purchase price of $23.00 ▪ Centerview and Morgan Stanley have engaged with the Bid Group’s advisors to further understand the proposal and underlying assumptions ▪ The Bid Group has responded with further clarifications which form the basis of the proposal which we have analyzed in the following pages
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 3 BACKGROUND ON SECTOR ▪ While Norse is pursuing a number of growth opportunities, the overall sector remains challenged ▪ Department Store multiples appear to reflect overarching concern around future prospects – Norse’s share price has decreased by 61% over the past five years, and the Company is currently trading at an NTM EBITDA multiple of 4.7x, below its 5 - year average of 5.2x (1) – Norse's performance is in - line with overall sector multiple contraction – the average peer NTM EBITDA multiple of 4.4x (2) is down from the 5 - year peer average of 4.8x (3) ▪ While there may be potential for Norse’s multiple to break out of its current and pre - transaction range, achieving a higher multiple will likely require an extended period of outperformance vs. both consensus and the category ▪ Management’s new LTP (August 2024), which has been reviewed by the Board, projects higher growth and lower capital expenditures than the prior version of the LTP (November 2023) and remains ahead of consensus, which has not changed materially ▪ In addition to the above, these slides include analysis of the following topics related to evaluating the Bid Group proposal: – How can the Board evaluate Norse’s potential stock price absent a transaction? – What is the fundamental value of the company? – How is the deal being funded, what is the potential ratings impact and how might a potentially higher offer impact this? – What are the range of potential counterproposals? Notes: 1. As of unaffected date of March 18, 2024 2. Represents average of Kohl’s current multiple of 5.1x and Macy’s unaffected multiple of 3.7x as of September 3, 2024, and December 8, 2023, respectively 3. Represents average of Kohl’s 5 - year average multiple of 5.0x and Macy’s unaffected 5 - year average multiple of 4.5x as of September 3, 2024, and December 8, 2023, respectively
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 4 3.0x 2.0x 1.0x 4.0x 5.0x 7.0x 6.8x 6.0x 5.8x 8.0x 9.0x 10.0x 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 M emo (2) : Fwd. Net Sales Growth 9% 8% 5% 2% 3% 2% 6% 5% 2% 0% 0% NTM EBIT Margin 10% 9% 6% 6% 6% 6% 2% 4% 5% 4% 4% NTM EBIT Dispersion (3) 13% 15% 14% 16% 12% 20% n.m. 54% 36% 25% 19% 4.2x Source: Note: (1) (2) (3) (4) Company filings, FactSet and Capital IQ as of September 3, 2024. EBITDA figures unburdened by amortization of developer reimbursements. Department Store Peers include Macy’s and Kohl’s. AV / NTM EBITDA multiple averaged through mid - 2020 to smooth sharp swings in broker estimates. Reflects average estimates for the fiscal year, except for NTM EBIT dispersion. Calculated as the difference of the high and low NTM EBIT estimate divided by consensus as of September 3 of each year. Reflects current Norse AV / NTM EBITDA multiple. 5.2x (4) NORSE VALUATION TETHERED TO GROWTH AND MARGIN OUTLOOK Increased dispersion reflects perceived uncertainty Shading Reflects 10 th - 90 th Percentile in Each Phase Covid disruption Norse AV / NTM EBITDA Valuation – Last 10 Years Norse Department Store Peer Average (1) Norse Dept. Store Peer Avg. Norse Deal Rumor (3/18/24)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 5 11% 11% 28% 24% 35% 15% 14% 28% 27% 22% 17% 34% 31% 43% CERTAINTY OF NEAR - TERM OUTLOOK ALSO A FACTOR IN MARKET VALUE Source: Company filings, Wall Street research and FactSet as of September 3, 2024. Note: Figures reflect fiscal years ending January the following calendar year. EBITDA figures unburdened by amortization of developer reimbursements. (1) Calculated as the difference of the high estimate and the low estimate divided by the consensus estimate. (2) Specialty Retail excludes Petco’s Adj. EPS consensus spread. Growth Retail Department Stores Specialty Retail Apparel Retail Home Improvement Off - Price Apparel Greater Uncertainty Greater Certainty 12.3x 15.0x 15.9x 9.0x 5.1x 5.6x 6.8x Lower Multiple Higher Multiple 10% 8% 6% 6% 5% 5% 4% Net Sales EBIT Adj. EPS (2) Median AV / NTM EBITDA Spread of FY’25E Consensus Estimates (1) Memo:
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 6 STRATEGIC LANDSCAPE CONTINUES TO EVOLVE Strategic M&A Announced Transaction Take - Private Candidates Prior Take - Private Attempt in 2024 Prior Take - Private Attempt in 2022 Recent Bankruptcies Recent sector activity underscores a weak demand outlook and potential for further consolidation Sold to Coupang Active Sale Process Sold to Naver Online Rationalization
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 7 NORSE FINANCIAL SUMMARY – LTP COMPARISON Source: Norse management. Note: Dollars in millions. Change in 2024E figures contemplates the conversion from retail accounting to cost accounting. (1) (2) EBITDA unburdened by amortization of developer reimbursements. Reflects right - of - use asset amortization less change in lease liabilities. Improved Norse Banner projections and new Rack store openings increased Management’s LTP projections Key Drivers of Change in Plan ▪ Increased net sales driven by improved outlook for 2024 and corresponding increase in ’25 - ’28 growth, largely resulting from improvement in Rack Stores ▪ Limited near - term flow through of increased sales down to adj. EBIT due to gross margin decline from shrink ▪ Reduction in capex in key areas including supply chain, technology and stores from ~3.5% of sales to ~3% of sales, with renewed focus on highest priority projects including 3 rd party pooling, highest ROI technology investments) Δ Latest LTP (August 2024) Previous LTP (November 2023) 2028E 2027E 2026E 2025E 2024E Management Projections Extrapolation Management Projections 2028E 2027E 2026E 2025E 2024E 2027E 2028E 2024E 2025E 2026E +$497 +$339 +$209 +$145 +$324 $14,949 $15,272 $15,819 $16,433 $17,074 $16,094 $16,577 $14,625 $15,127 $15,611 Total Revenue +90bp +78bp +39bp (127bp) +220bp 1.7% 2.2% 3.6% 3.9% 3.9% 3.1% 3.0% (0.5%) 3.4% 3.2% % Growth +$500 +$347 +$220 +$157 +$340 $14,498 $14,792 $15,319 $15,910 $16,525 $15,563 $16,025 $14,158 $14,635 $15,099 Net Sales +89bp +78bp +39bp (133bp) +239bp 2.0% 2.0% 3.6% 3.9% 3.9% 3.1% 3.0% (0.4%) 3.4% 3.2% % Growth +$46 ($11) ($18) ($5) ($8) $1,521 $1,406 $1,340 $1,276 $1,178 $1,416 $1,475 $1,186 $1,281 $1,358 Adj. EBITDA (1) +0b p (27bp) (25bp) (13bp) (25bp) 9.2% 8.8% 8.7% 8.6% 8.1% 9.1% 9.2% 8.4% 8.8% 9.0% % of Net Sales +$155 +$81 +$14 +$6 ($3) $989 $876 $769 $674 $577 $795 $835 $580 $668 $755 Adj. EBIT +78bp +40bp +2b p (1bp) (12bp) 6.0% 5.5% 5.0% 4.6% 4.0% 5.1% 5.2% 4.1% 4.6% 5.0% % of Net Sales ($89) ($98) ($106) ($108) ($24) $474 $457 $440 $422 $477 $555 $564 $502 $530 $546 Memo : Capex (65bp) (70bp) (74bp) (77bp) (25bp) 2.9% 2.9% 2.9% 2.9% 3.3% 3.6% 3.5% 3.5% 3.6% 3.6% % of Net Sales
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 567 541 564 522 784 502 577 674 769 876 989 Margin FY2019A (% of Revenue): 5.1% FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A 5.8% 5.3% 3.4% 4.9% 3.7% 4.4% 3.6% 3.9% 3.9% 3.2% FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A 8.9% 8.6% 7.5% 8.5% 7.8% 8.4% 7.6% 7.9% 7.8% 7.1% +47% +19% +7% 9.4% Margin FY2019A (% of FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A FY2019A 3.9% 3.9% 2.2% 3.6% 0.9% 2.2% 1.8% 1.7% (5.4%) 5.0% Growth: (2.1%) +15% +9% +4% 1,521 1,406 1,340 1,164 1,173 1,276 1,133 1,178 1,153 1,106 1,455 14,693 14,965 15,524 15,530 14,949 15,104 15,272 15,819 15,440 16,433 17,074 (0%) +1% +2% 8 Management Long - Term Plan vs. Consensus Historical Consensus Management Long - Term Plan (August 2024) Sources: Capital IQ as of September 3, 2024; Management Long - Term Plan as of August 2024 for years FY24 - 28 Note: 1. Adds back all depreciation and amortization including amortization of developer reimbursements Revenue): Adj. EBIT ($MM) Adj. EBITDA ($MM) (1) Total Revenue ($MM) MANAGEMENT’S LONG - TERM PLAN VS. STREET PROJECTIONS Actual Performance Projections FY’24E – FY26E CAGR 1.6% 2.9% 1.3% 6.7% (1.7%) 15.4%
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW $ $ 5 5 $ $ 1 1 0 0 $ $ 1 1 5 5 $ $ 2 2 0 0 $ $ 2 2 5 5 $ $ 3 3 0 0 $ $ 4 4 0 0 $38.72 $ $ 3 3 5 5 $ $ 4 4 5 5 M M a a r r - - 2 2 3 3 M M a a r r - - 2 2 4 4 M M a a r r - - 2 2 5 5 M M a a r r - - 2 2 6 6 FUTURE SHARE PRICE ANALYSIS – CENTERVIEW $24 Illustrative Future Share Price Trajectory (LTP and Consensus Estimates) 9 Unaffected Price: $17.06 $19 Source: Norse management, company filings, FactSet and Capital IQ as of September 3, 2024. Note: Future share prices represent future value and do not include value of dividends. Future fully diluted share count assumed to be diluted by forecasted stock - based compensation issuance. Consensus free cash flow extrapolated based on LTP free cash flow conversion rate. Assumes cash roll - forward beginning with current Q2’24 cash of $679mm. (1) Assumes peer - based cost of equity of 16.6%. LTP at 4.5x NTM EBITDA LTP at range of 4.0x – 5.0x NTM EBITDA Consensus at 4.5x NTM EBITDA Consensus at range of 4.0x – 5.0x NTM EBITDA Historical share price Represents illustrative future value of share price on a standalone basis – – M M a a r r - - 2 2 1 1 M M a a r r - - 2 2 2 2 Present Value of Future Share Price (1) LTP Consensus $20 $18 $21 $17 $21 $18 FYE’24E FYE’25E
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 10 NORSE FAMILY / LIVERPOOL PROPOSAL SUMMARY Due Diligence Requirements Approvals and Timing ▪ Completed necessary preliminary diligence ▪ Expect to complete limited, confirmatory due diligence on expedited basis ▪ Prepared to negotiate and execute definitive documentation on expedited basis ▪ Confirmatory due diligence to be completed in parallel with negotiation of definitive documentation ▪ Execution of definitive documentation subject to final approval of Liverpool Board of Directors ▪ Conditioned on approval by Special Committee and majority of disinterested shares Financing ▪ Norse family and Liverpool expected to rollover equity interests representing $1.1bn and $0.4bn of implied value, respectively ▪ Norse family and Liverpool expected to contribute additional $0.5bn and $1.2bn, respectively, to achieve targeted 50.1% and 49.9% respective equity ownership ▪ Incremental bank financing of $325mm at company, for which the Bid Group has received preliminary proposals from two existing lenders ▪ Also expecting to use $520mm in company cash from balance sheet, leaving $100mm minimum cash at close ▪ No reference to guarantees for buyer's obligations (including damages for willful breach) ▪ Assuming agreement on price, progress with rating agency review, and cooperation with securing debt: – Not subject to any financing contingency – Bid Group will provide 100% equity commitment (but the Bid Group declined to provide additional detail regarding the amount and structure of the equity commitments) – Company will have full specific performance rights Consideration and Structure ▪ $23.00 per share cash offer price implying a purchase equity value of $3.8bn and $5.8bn in implied enterprise value (1) ▪ Offer for 100% of Norse outstanding shares of common stock ▪ Assumes $2.7bn of debt outstanding, all of which would remain post consummation of transaction ▪ Company to fund currently underfunded Supplemental Executive Retirement Plan (“SERP”) with exception of amounts required to be funded on behalf of Erik, Peter and Jamie Norse – Bid Group estimates ~$140mm total need to fund SERP Identity of Purchaser ▪ Bid Group is comprised of members of the Norse family and Liverpool ▪ Beneficially own approximately 43% of the outstanding shares of the Company’s common stock as of Q1’24 10 - Q Voting Agreements ▪ Norse family and Liverpool to provide voting agreements agreeing to vote in favor of proposed transaction ▪ Engage in good faith discussion with other potential buyers (1) Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. Termination ▪ No reverse termination fee ▪ Board may change its recommendation for a superior proposal or intervening event, but must still hold a shareholder vote on the deal ▪ If Board changes its recommendation and shareholders vote down the deal, Company would pay a termination fee ▪ If shareholders otherwise vote down deal, Company would reimburse Bid Group's expenses
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 11 174.5 Diluted Shares Outstanding (1) $4,014 Total Equity Value 2,011 (+) Net Debt (2) $6,026 Total Aggregate Value Aggregate Value / Adj. EBITDA (3) : 5.1x $1,178 Management LTP - FY'24E 4.7x $1,276 Management LTP - FY'25E 5.3x $1,133 Consensus - FY'24E 5.1x $1,173 Consensus - FY'25E Proposal Metric $23.00 BID GROUP PROPOSAL: IMPLIED PREMIA AND MULTIPLES Multiples Premia Share Price Premium to: 34.8% $17.06 Unaffected (3/18/24) 0.8% $22.82 Current (9/3/24) 4.9% $21.92 30 - Day VWAP 4.7% $21.96 60 - Day VWAP 75.8% $13.08 52 - Week Low (3.4%) $23.82 52 - Week High Proposal Metric $23.00 Source: Norse management, company filings, FactSet and Capital IQ as of September 3, 2024. Note: (1) Dollars in millions, except per share amounts. Includes all outstanding options, unvested RSUs and unvested PSUs. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. Reflects current debt of $2,690 and cash of $679. Adj. EBITDA figures unburdened by amortization of developer reimbursements. (2) (3)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW PROPOSED TRANSACTION SUMMARY 12 Notes Reflecting New Proposal $MM $MM Sources # • Estimate for FY2024 year - end $620 $620 Company Cash on Balance Sheet 1 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,615 Company Existing Debt 2 • Likely funded through $1 - 1.2Bn ABL, with drawn balance paid off 1 year after transaction close to • Commitment letters to be provided at signing 325 250 New Transaction Debt 3 • Current holdings (49.6MM shares) 1,146 1,141 Family Investor Equity Roll 4 • Direct loan from Liverpool to Family Group (carried on Liverpool Balance Sheet) 467 454 Family New Equity Roll 5 • Current holdings (15.8MM shares) 362 362 Liverpool Equity Roll 6 • Likely funded through $1.2Bn Balance Sheet cash with debt covering potential shortfall 1,244 1,226 Liverpool New Equity 7 $6,855 $6,669 Total Sources Notes Reflecting New Proposal $MM $MM Uses # • Based on Q2 2024A basic shares outstanding (164.2MM) plus dilutive equity securities at assumed transaction close of ~0.6MM in - the - money options and ~0.5MM of vested RSUs at $23.00 / share $3,800 $3,764 Company Equity Value 8 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,615 Existing Debt 9 • Unfunded balance ($168MM) to be funded into trust upon transaction close • Family Group to waive $28MM portion • Treated as transaction fees 140 140 SERP Funding 10 • Fully accounts for advisor fee estimates provided by Company advisors and financing fees required to consummate the transaction 125 50 Preliminary Transaction Fees 11 • Based on Family Group advisor estimates, with new $1 - 1.2Bn ABL facility intended to fund seasonal working capital and liquidity needs 100 100 Minimum Cash 12 $6,855 $6,669 Total Uses ▪ Proposal contemplates in - the - money options and RSUs that vest by assumed transaction close; unvested PSUs and RSUs to be replaced by revised compensation plan Original Revised Key Revisions
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW $17.06 $17.15 $18.46 $18.51 Offer $23.00 $21.07 $16.35 $19.83 $20.14 $19.52 Adjustment H1’24 Cumulative Macy’s End of Takeover Leak Share Price Pre - Change in Analyst Share Price Perf. Present Value of 1YR Average Unaffected Share Earnings Buyout Talks Share Price Macy's Rumor Price Targets (Pre (Q1 Release - Current Analyst Multiple Price (1) Adjustment Adjustment “Bump” Q1 - Current) (3) Current) (5) Price Target Median (3)(4) ILLUSTRATIVE “ADJUSTED UNAFFECTED” PRICE METHODOLOGIES 13 4.8x (2) 4.9x (2) 4.8x (2) 4.3x (2) 4.9x (2) 4.6x (2) 4.5x (2) 4.4x (2) 4.7x Implied AV / NTM EBITDA Q1’24 and Q2’24 earnings 3 - day share price reactions (5) Macy’s 1 - day share price reaction to terminated buyout talks applied to Norse current share price Current share price less the takeover leak 3 - day share price reaction Share price prior to Macy’s takeover rumor (12/8/23) % change of median price target from pre Q1 release to post Q2 release (5) Share price performance from Q1 release (5/30/24) to current (5) Present Value of Median 1 - year Analyst Price Target (3)(4) 1 - year average unaffected multiple Unaffected share price ( 3 / 18 / 24 ) Methodology +$1.26 (Q1’24) +$1.20 (Q2’24) (11.7%) ($2.99) - - +23.5% +8.5% - - 4.4x NTM EBITDA - - Relevant Metric Illustrative “Adjusted Unaffected” Share Price ($) Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Reflects net debt as of Q2 2024A, and all outstanding options, unvested RSUs and unvested PSUs 3. “Current” Analyst Price Targets as of pre - offer 4. PV share price discounted using Morgan Stanley’s estimated cost of equity of 13.8% as of September 3, 2024 5. Applied to Norse unaffected share price or multiple Morgan Stanley Centerview Source: Capital IQ as of September 3, 2024
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Methodology Metric ($MM) Implied Share Price Agg. Value ($MM) Low High Rounded to the nearest $0.25 Public Trading Comparables (1)(2) Consensus: AV / FY2024E EBITDA: 3.5x - 5.0x Management LTP Case: AV / FY2024E EBITDA: 3.5x - 5.0x 1,133 1,178 3,965 4,122 5,664 5,889 Discounted Equity Value (1)(3) Consensus: 3.5x - 5.0x FY2026E EBITDA Management LTP Case: 3.5x - 5.0x FY2026E EBITDA 1,164 1,340 4,149 4,673 5,589 6,331 Discounted Cash Flow (1)(4) Management LTP Case: 3.5x - 5.0x Exit Multiple; 8.5% - 9.6% WACC 5,371 7,160 Reference Only: 52 - Week Trading Range Analyst Price Targets (Undiscounted) 4,280 4,280 4,018 6,200 6,374 5,851 Analyst Price Targets (Discounted) (1)(5) Leveraged Buyout (6) Management LTP Case: 17.5% - 22.5% Target IRR; Exit Multiple = Entry 5,068 5,894 $11.25 $12.00 $12.25 $15.25 $19.25 $13.00 $13.00 $11.50 $18.50 $21.00 $22.25 $20.50 $24.75 $29.50 $24.00 $25.00 $22.00 $23.50 $0 $10 $20 $30 NORSE PRELIMINARY VALUATION ANALYSIS – MORGAN STANLEY Based on Management Long - Term Plan and Consensus Estimates Sources: Capital IQ (unaffected date of March 18, 2024, current as of September 3, 2024); Management Long - Term Plan as of August 2024 for years FY24 - 28; Notes: 1. Assumes FDSO of ~174.5MM; inclusive of ~164.2MM basic shares outstanding at Q2 2024 with full accelerated vesting of dilutive equity securities inclusive of ~0.7MM options, ~1.5MM PSUs, and ~8.1MM RSUs 2. Range based on NTM trading multiples of Macy’s (3.7x) and Kohl’s (4.8x), as of unaffected date of March 18, 2024; 3. Represents present value of implied year - end 2025E share price based on discounted equity value analysis; share prices and cumulative dividends discounted at 13.8% cost of equity; sensitized on +0.75x / (0.75x) exit multiple 4. Implied share price based on DCF multiples method; WACC of 9.1%; EBITDA exit multiple of 4.25x sensitized on +0.75x / (0.75x) 5. Represents present value of median of analyst price targets as of September 3, 2024; discounted analyst price targets discounted at 13.8% cost of equity; excludes Morningstar ($38.50 price target) 6. Represents implied entry price to generate 17.5 - 22.5% IRR based on Management Long - Term Plan; assumes offer diluted share count of ~165MM (1)(5) Unaffected Share Price: $17.06 Bid Group Offer Price: $23.00 Consensus Management LTP 14
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 15 Implied AV / '24E EBITDA Methodology Assumption Implied Share Price Value Implied AV 52 - Week Trading Range 52 - Wk High: 07/17/24 52 - Wk Low: 11/13/23 $4,285 – $6,170 3.6x – 5.2x Analyst Price Target Range (1) High: 08/27/24 Low: 08/27/24 $4,271 – $6,379 3.6x – 5.4x Premia Paid Analysis Premium to Unaffected: 25% - 40% $5,730 – $6,182 4.9x – 5.2x Public Trading Comparables 4.0x - 5.0x '24E EBITDA of $1,178mm $4,711 – $5,889 4.0x – 5.0x Discounted Cash Flow Analysis WACC: 11.0% - 13.0% PGR: 1.5% - 2.5% $5,338 – $7,035 4.5x – 6.0x $13.10 $13.00 $21.30 $15.55 $19.10 $23.80 $25.00 $23.90 $22.25 $28.70 NORSE PRELIMINARY VALUATION ANALYSIS – CENTERVIEW For Reference Only Source: Norse management, Company filings and FactSet as of September 3, 2024. Note: Implied share prices rounded to the nearest $0.05. Illustrative DCF valuation date of August 3, 2024. Assumes mid - year discounting. Public Trading Comps reflect LTP financials. EBITDA is unburdened by amortization of developer reimbursements. (1) High reflects TD Cowen; Low reflects UBS. Unaffected Share Price: $17.06 Bid Group Proposal Price: $23.00
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW SUMMARY PERSPECTIVES ON FINANCING CONSIDERATIONS 16 ▪ Norse’s Senior Notes totaling $2.3Bn (all debt with exception of Debentures due 2028) contain “double trigger” change of control put option for bondholders, comprising of: 1. Change of control and 2. Subsequent downgrade to the bond rating by all 3 agencies of these bonds specifically in connection with the change of control transaction ▪ Therefore, the ratings assessment concurrent with the transaction announcement will be critical to the Company’s ability to roll over its current capital structure ▪ The Bid Group's current offer assumes the rollover of the existing capital structure, and the Bid Group would likely be unwilling to make a proposal if the existing indebtedness had to be refinanced in connection with the transaction ▪ The Bid Group’s current offer contemplates $325MM in additional debt drawn via new $1 - 1.2Bn ABL facility – Based on the implied key metrics, Norse should likely be able to hold ratings at Moody’s or Fitch Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Refers to estimated agency - defined metrics; current reflects historical trailing twelve months at fiscal Q2 2024; projections based on Management Long - Term Plan as of August 2024 2. Pro forma assumes $23.00 offer price, transaction close on February 1, 2025, minimum cash balance of $100MM, management and Liverpool roll current ownership interests, and incremental $325MM of debt drawn via new ~$1.2Bn ABL at an assumed rate of SOFR + 200 bps 3. Agency debt adjustments: Moody’s includes operating leases, pensions (in current), and non - standard adjustments; S&P includes operating leases, pensions (in current), and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 4. Agency EBITDAR adjustments: Moody’s includes operating lease expense, pensions (in current), and unusual items; S&P includes operating lease expense, pensions (in current), stock - based compensation, and other; Fitch includes operating lease expense and other 5. No defined Fitch breakpoint; reflects key metric under broader consideration in a downgrade context Illustrative Breakpt. PF (2) Transact. Current (1) Key Metric (1)(3)(4) 4.0x 3.2x 3.2x Debt / EBITDAR 20.0% 21.3% 27.5% RCF / Net Debt 3.25x 2.41x 2.44x EBIT / Interest Illustrative Breakpt. PF (2) Transact. Current (1) Key Metric (1)(3)(4) 3.0x 3.0x 2.6x Debt / EBITDAR 30.0% 25.9% 30.5% FFO / Debt Illustrative Breakpt. PF (2) Transact. Current (1) Key Metric (1)(3)(4) 4.0x 3.8x 3.9x Debt / EBITDAR N/A (5) 2.8% 1.8% FCF Margin ▪ Additional quantitative and qualitative factors will be evaluated by the agencies during the ratings assessment process, including market characteristics, the Bid Group’s go - forward governance and capital allocation policies, and specific terms of the new ABL facility ▪ The Bid Group has committed to an approach that preserves the ability to roll over Norse’s Senior Notes, including maintaining ample liquidity and target leverage ratios ▪ The Bid Group's current offer states that there will be no contingency related to the notes assuming, among other things, progress on rating agency review
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 2024E 2024E 5.8x 5.7x 5.6x 5.6x 5.5x 5.4x 5.3x $1,133 Internal Rate of Return (IRR) 13.9% 13.4% 12.8% 12.3% 11.8% 11.4% 10.9% Multiple on Invested Capital (MOIC) 1.8x 1.8x 1.8x 1.7x 1.7x 1.7x 1.6x Moody's 3.2x 3.2x 3.2x 3.3x 3.3x 3.4x 3.4x S&P 3.0x 3.1x 3.1x 3.1x 3.2x 3.2x 3.2x Fitch 3.8x 3.8x 3.9x 3.9x 3.9x 4.0x 4.0x Memo: New Transaction Debt $325 $375 $425 $476 $526 $576 $626 Bid Group Funding Incremental Capital Required vs. Proposal – +$50 +$100 +$151 +$201 +$251 +$301 Illustrative Bid Group Returns (4,5) Illustrative Agency - Defined Leverage Ratios (2024E PF) (5) Consensus - FY2024E 17 ILLUSTRATIVE NORSE TAKE PRIVATE AT VARIOUS PRICES Source: Norse management, Moody’s, S&P, Fitch, company filings and FactSet as of September 3, 2024, except where otherwise noted. Note: Dollars in millions, except per share amounts. (1) Includes all outstanding options, unvested RSUs and unvested PSUs. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. (2) Reflects current debt of $2,690 and cash of $679. (3) Adj. EBITDA figures unburdened by amortization of developer reimbursements. (4) Assumes illustrative 4.5x AV / LTM EBITDA exit at FY’28E year - end. (5) Illustratively assumes the management LTP, transaction close on February 1, 2025, 100% of excess cash flow post - close swept to common equity as dividends after drawn ABL balance is paid down, $100mm minimum cash and illustrative total transaction fees of $125mm, any incremental purchase price is funded by new transaction debt and new transaction debt cost of SOFR+200bps. Illustrative ratings breakpoints at various prices not reflective of other potential qualitative factors Illustrative Price Per Share $26.00 $25.50 $25.00 $24.50 $24.00 $23.50 +13% +11% +9% +7% +4% +2% $23.00 Metric +52% +49% +47% +44% +41% +38% +35% $17.06 vs. Unaffected (3/18/24) +14% +12% +10% +7% +5% +3% +1% $22.82 vs. Pre - Proposal (9/3/24) Premium / (Discount) +17% +15% +12% +10% +8% +6% +3% $22.24 vs. Current (9/10/24) 174.8 174.7 174.7 174.7 174.6 174.6 174.5 Diluted Shares Outstanding (1) $4,544 $4,456 $4,367 $4,279 $4,191 $4,103 $4,014 Equity Value 2,011 2,011 2,011 2,011 2,011 2,011 2,011 Plus: Status Quo Current Net Debt (2) $6,555 $6,467 $6,379 $6,290 $6,202 $6,114 $6,026 Aggregate Value 5.6x 5.5x 5.4x 5.3x 5.3x 5.2x 5.1x $1,178 Management LTP - FY2024E AV / Adj. EBITDA (3)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 18 SUPPLEMENTARY MATERIALS
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW SUPPLEMENTARY MATERIALS A Adjusted Unaffected Share Price Supporting Analysis B Morgan Stanley Supporting Valuation Analysis C Centerview Supporting Valuation Analysis D Market Perspectives on the Department Store Sector E Investor Perspectives on Norse's Valuation Multiple F Ratings Considerations G Process Summary 19
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 20 APPENDIX A ADJUSTED UNAFFECTED SHARE PRICE SUPPORTING ANALYSIS
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW POTENTIAL DRIVERS OF SHARE PRICE CHANGE Other Fundamental Factors Department Store Peer Performance ▪ Mixed earnings from Department store peers, with Macy’s outperforming Street expectations and raising guidance ▪ Meanwhile Kohl’s saw disappointing topline and earnings results and significant downward revision of guidance ▪ Capital allocation, strategic pivots, etc. Change in Norse Valuation Factors Topline / Growth EBIT Margin Macro Environment / Industry Sentiment ▪ Continuation of recent trends, including elevated levels of inflation and higher interest rates ▪ U.S. interest rates expected to remain higher for longer ▪ Improvement in growth outlook, partially driven by strength of Q1 - Q2 2024 earnings led by Rack performance ▪ Margin outlook down due to risks from Q3 - Q4 2024 profitability ramp embedded in guidance Terminal Trajectory ▪ Difficult to believe perpetuity assumptions have changed following two quarters of performance ? Potential Drivers of Share Price Change Considerations Change in Perception Since 3/18 Rumor Change in Norse Earnings ▪ Earnings outlook largely unchanged and unlikely to materially affect Norse valuation ▪ Between the unaffected date of March 18 th and current, 2024E and 2025E Adj. EPS estimates are +3.1% and +3.0% , respectively Potential Multiple Drivers 21 Source: FactSet as of September 3, 2024.
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 22 2.0x 2.5x 3.5x 3.4x 4.5x $10 $16 $18 $20 $22 $24 Aug - 23 Nov - 23 Feb - 24 May - 24 Aug - 24 $12.35 $12 2.8x $14 3.0x $15.49 +25.4% CASE STUDY – MACY’S TRADING ANALYSIS DURING BUYOUT DISCUSSIONS Macy’s Share Price & AV / NTM EBITDA Valuation Over Time Source: Company filings and FactSet as of September 3, 2024. Dec. 11, 2023: Leak of buyout bid from Arkhouse Management & Brigade Capital of $21 per share Share Price Reaction: +19.4% AV/EBITDA: 4.2x Jan. 21, 2024: Company publicly rejects bid, citing financing concerns and lack of compelling value Share Price Reaction: +3.6% Cumulative Share Price Reaction: +5.0% AV/EBITDA: 3.9x Mar. 3, 2024: Receives revised bid from Arkhouse & Brigade of $24 per share Share Price Reaction: +13.5% Cumulative Share Price Reaction: +17.6% AV/EBITDA: 3.8x July 15, 2024: Terminates discussions with Arkhouse & Brigade Share Price Reaction: (11.7%) Cumulative Share Price Reaction: (3.1%) AV/EBITDA: 3.4x Share Price AV / NTM EBITDA 4.0x Avg. Multiple: 3.7x Feb. 27, 2024: Reports Q4’23 earnings with an EPS miss Share Price Reaction: (7.7%) Cumulative Share Price Reaction: +5.9% AV/EBITDA: 3.5x
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 23 Since 2019, Norse multiple appears to reach ceiling of mid - single digits NORSE TRADING MULTIPLE VOLATILITY IN LAST 5 YEARS Norse AV / NTM EBITDA September 2019 – Present (1) Source: Company filings and FactSet as of September 3, 2024. (1) Excludes COVID - related disruption period of March 2020 through November 2021. % of Days 4.0x – 4.5x 4.5x – 5.0x ≤4.0x 5.5x – 6.0x 9% 29% 35% 23% 4% 5.0x – 5.5x Days that Norse traded at 5.0x - 5.5x during the affected period (Mar - 24 – present) represent 8% of total 8%
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW $14.4 $14.4 $14.2 $14.3 $14.3 $14.4 $14.5 $14.4 $14.4 $14.6 2024E % YoY Growth 2025E $563 $593 $542 $552 $520 $506 $503 $528 $538 $554 2025E $2.01 $2.06 $1.94 $1.87 $1.83 $1.90 $1.90 $1.89 $1.95 2024E % YoY Growth 2025E NORSE CONSENSUS ESTIMATES OVER TIME Source: Company filings and FactSet as of September 3, 2024. Note: Post Q2’23, Post Q3’23, Post Q4’23, Post Q1’24 and Post Q2’24 / Current represent consensus figures taken as of September 17, 2023, December 5, 2023, March 17, 2024, June 12, 2024 and September 3, 2024, respectively. Revenue ($bn) Adj. EBIT ($mm) EPS 2024E % Margin Post Q2’23 Post Q3’23 Post Q1’24 % Change in Estimates (1.3%) +0.4% +0.8% (0.7%) +0.6% +0.9% (3.8%) (6.6%) (0.7%) (7.1%) (5.8%) +1.5% (3.5%) (5.3%) $1.79 (2.3%) (9.2%) +1.5% Top - line growth expectations have accelerated over past year, while profitability dollars and margin have deteriorated Post Q4’23 / Pre - Takeover Leak Post Q2’24 / Current (0.1%) +0.3% +7.0% +5.1% +2.5% (0.9%) 4.1% 3.9% +0.2% +0.5% (3.5%) (4.9%) 3.8% 3.8% +0.9% +0.0% +3.5% (13.5%) 3.6% 3.5% +1.0% +0.3% +6.2% (15.5%) 3.6% 3.5% +1.1% +1.1% +3.4% (10.8%) 3.8% 3.7% +1.5% +1.0% +0.8pp (9.9pp) Δ (0.3pp) (0.2pp) Δ +1.3pp +0.6pp Δ 24 +5.5% +0.3% +2.7%
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW APPENDIX B MORGAN STANLEY SUPPORTING VALUATION ANALYSIS 25
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 5.1x 4.7x 4.6x 4.1x 5.0x 3.9x 5.3x 5.1x 4.7x 4.4x 5.0x 3.9x 3.6% 3.9% 3.5% 4.0% 3.8% 4.7% 1.4% 1.9% 0.8% 1.5% (2.8%) 0.6% 0.9% 5.2% (1.2%) 5.4% (4.2%) (4.3%) 7.6% 7.9% 7.5% 8.1% 8.6% 8.6% 12.0x 12.7x 9.4x 8.8x 10.7x 6.3x 11.5x 9.4x 8.6x 7.5x 10.5x 6.3x NORSE’S MANAGEMENT LONG - TERM PLAN IS AHEAD OF CONSENSUS REVENUE AND PROFITABILITY EXPECTATIONS 26 Sources: Capital IQ as of September 3, 2024; Management Long - Term Plan as of August 2024 Notes: 1. Norse figures add back all depreciation and amortization including amortization of developer reimbursements 2. Norse FDSO and net debt as of Q2 2024A; inclusive of $2,690MM in debt and $679MM in cash and equivalents 3. Represents Norse as of unaffected date of March 18, 2024 4. Represents Macy’s as of unaffected date of December 8, 2023 CY2025E P / E (x) CY2024E P / E (x) CY2025E AV / EBITDA (x) (1)(2) CY2024E AV / EBITDA (x) (1)(2) CY2024E EBIT Margin (%) CY2024E EBITDA Margin (%) (1) CY’23A – CY’25E EBITDA CAGR (%) (1) CY’23A – CY’25E Revenue CAGR (%) Norse Current Consensus (4) Norse Current Management LTP Norse Unaffected Consensus (3) Norse Unaffected Management LTP (3) Morgan Stanley
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Date Disclosed Valuation Details Price Target Rating Firm Name 8/27/2024 Discounted Cash Flow $38.50 Buy Morningstar 8/27/2024 ~12.5x FY2025 EPS $25.00 Hold TD Cowen 8/27/2024 9.3x 2025E P/E and 5.7x 2025E AV / EBITDA $24.00 Buy KeyBanc 8/28/2024 11.7x 2026E EPS $24.00 Hold Telsey 8/27/2024 ~12.0x FY2025 EPS $23.00 Hold Gordon Haskett 8/28/2024 ~5.0x FY2024 AV / EBITDA $22.00 Hold Citi 8/27/2024 ~10x FY2025 EPS $22.00 Hold BMO 8/27/2024 10.0x 2025E EPS $19.00 Hold Evercore 8/28/2024 4.3x 2026E AV / EBITDA $20.00 Sell JP Morgan 8/27/2024 9.0x NTM P/E Multiple based on CY2026 EPS $18.00 Sell Barclays 8/27/2024 4.75x Q5 - Q8 AV / EBITDA Estimates $21.00 Hold Goldman Sachs 8/28/2024 5.0x FY2025 AV / EBITDA $20.00 Sell Bank of America 8/28/2024 10.0x FY2025 P/E $20.00 Hold Jefferies 8/27/2024 ~0.3x FY2026E AV / Sales $13.00 Sell UBS 8/28/2024 NA NA Hold Guggenheim 8/28/2024 NA NA Hold William Blair 8/28/2024 NA NA NA Morgan Stanley Present Value: $18.46 (2) $21.00 Median (1) Present Value: $18.32 (2) $20.85 Mean (1) As of Latest Quarterly Earnings Released on August 27, 2024 CURRENT SHARE PRICE REPRESENTS A PREMIUM TO PRESENT VALUE OF MEDIAN PRICE TARGETS Sources: Wall Street Equity Research, Market Data as of September 3, 2024 Notes: 1. Morningstar Price Target excluded from median and mean calculations 2. Analyst Price Targets reflective of pre - offer levels; PV share price discounted using Morgan Stanley’s estimated cost of equity of 13.8% as September 3, 2024 Morgan Stanley 27
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW AV / NTM Adj. EBITDA of 5.00x $12.37 $14.80 $17.41 $19.80 $17.06 $22.45 $24.80 Current 2024E 2025E $11.60 $12.26 $17.06 $16.32 $16.38 $21.05 $20.50 Current 2024E 2025E Future Share Price (Incl. Dividends) (1) $MM / Share Present Value of Future Share Price (Incl. Dividends) (1)(2) $MM / Share Consensus Estimates In - Line With Unaffected Share Price of ~$17 ILLUSTRATIVE DISCOUNTED EQUITY VALUE | CONSENSUS Notes: 1. Calculated as NTM EBITDA multiplied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by JWN FDSO of ~174.5MM; inclusive of future value of cumulative dividends per share discounted to present value 2. Discounted to July 30, 2024 at 13.8% cost of equity 3. Market data as of unaffected date of March 18, 2024; Current share price as of September 3, 2024 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 1,164 5.0x 1,173 4.3x 1,164 4.3x 1,173 3.5x 1,164 3.5x 1,173 AV / NTM Adj. EBITDA Multiple (x) NTM Adj. EBITDA 5,818 5,865 4,945 4,985 4,072 4,106 Future Aggregate Value (1,586) (2,044) (1,586) (2,044) (1,586) (2,044) ( - ) Net Debt 4,231 3,821 3,359 2,942 2,486 2,062 Future Equity Value 175 175 175 175 175 175 FDSO (1) $24.24 $21.90 $19.24 $16.85 $14.24 $11.81 Future Share Price ($USD) $24.80 $22.45 $19.80 $17.41 $14.80 $12.37 Future Share Price Incl. Dividends 1.50 0.50 1.50 0.50 1.50 0.50 Periods 0.82 0.94 0.82 0.94 0.82 0.94 Discount Factor (2) $19.97 $20.53 $15.86 $15.80 $11.74 $11.08 Discounted Share Price ($USD) $20.50 $21.05 $16.38 $16.32 $12.26 $11.60 Discounted Share Price Incl. Dividends 7.7% 10.6% (13.9%) (14.2%) (35.6%) (39.1%) Premium / (Discount) to Unaffected 30D VWAP ($19.03) 20.2% 23.4% (4.0%) (4.3%) (28.1%) (32.0%) Premium / (Discount) to Unaffected ($17.06) (3) (10.2%) (7.8%) (28.2%) (28.5%) (46.3%) (49.2%) Premium / (Discount) to Current ($22.82) (3) Denotes range on FBF 3.50x NTM Adj. EBITDA 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x 5.00x NTM Adj. EBITDA Morgan Stanley 28
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 1,340 5.0x 1,276 4.3x 1,340 4.3x 1,276 3.5x 1,340 3.5x 1,276 AV / NTM Adj. EBITDA Multiple (x) NTM Adj. EBITDA 6,701 6,381 5,695 5,424 4,690 4,467 Future Aggregate Value (1,567) (2,041) (1,567) (2,041) (1,567) (2,041) ( - ) Net Debt 5,134 4,340 4,129 3,383 3,124 2,426 Future Equity Value 175 175 175 175 175 175 FDSO (1) $29.42 $24.87 $23.66 $19.38 $17.90 $13.90 Future Share Price ($USD) $29.97 $25.43 $24.22 $19.94 $18.46 $14.46 Future Share Price Incl. Dividends 1.50 0.50 1.50 0.50 1.50 0.50 Periods 0.82 0.94 0.82 0.94 0.82 0.94 Discount Factor (2) $24.24 $23.31 $19.49 $18.17 $14.75 $13.03 Discounted Share Price ($USD) $24.76 $23.84 $20.01 $18.69 $15.27 $13.55 Discounted Share Price Incl. Dividends 30.1% 25.3% 5.2% (1.8%) (19.8%) (28.8%) Premium / (Discount) to Unaffected 30D VWAP ($19.03) 45.1% 39.7% 17.3% 9.6% (10.5%) (20.6%) Premium / (Discount) to Unaffected ($17.06) (3) AV / NTM Adj. EBITDA of 5.00x $14.46 $18.46 $19.94 $24.22 $17.06 $25.43 $29.97 Current 2024E 2025E $13.55 $15.27 $17.06 $18.69 $20.01 $23.84 $24.76 Current 2024E 2025E Future Share Price (Incl. Dividends) (1) $MM / Share Present Value of Future Share Price (Incl. Dividends) (1) (2) $MM / Share Achieving the LTP Implies a $3 - 4 Premium to Unaffected Price ILLUSTRATIVE DISCOUNTED EQUITY VALUE | MANAGEMENT LONG - TERM PLAN 3.50x NTM Adj. EBITDA 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x 5.00x NTM Adj. EBITDA Morgan Stanley Premium / (Discount) to Current ($22.82) (3) (40.6%) (33.1%) (18.1%) (12.3%) 4.5% 8.5% Denotes range on FBF Notes: 1. Calculated as NTM EBITDA multiplied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by JWN FDSO of ~174.5MM; inclusive of future value of cumulative dividends per share discounted to present value 2. Discounted to July 30, 2024 at 13.8% cost of equity 3. Market data as of unaffected date of March 18, 2024; Current share price as of September 3, 2024 29
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 3.9% 3.9% 3.6% 2.2% % Growth 1,521 1,406 1,340 1,276 681 Adjusted EBITDA 8.9% 8.6% 8.5% 8.4% 8.8% % Margin (497) (493) (531) (552) (265) ( - ) D&A (35) (37) (40) (50) (29) ( - ) Amort. Of Developer Reimbursements 989 876 769 674 387 EBIT 6% 5% 5% 4% 5% % Margin (267) (236) (208) (182) (98) ( - ) Tax Expense 27% 27% 27% 27% 26% % Effective Tax Rate 497 493 531 552 265 (+) D&A 35 37 40 50 29 (+) Amort. Of Developer Reimbursements 202 196 191 187 93 (+) Right of Use Asset Amort. (288) (279) (272) (267) (134) (+) (Increase) / Decrease in Lease Liabilities (28) (49) (51) (104) (226) (+) (Increase) / Decrease in NWC (474) (457) (440) (422) (273) ( - ) CapEx 665 580 560 488 43 Unlevered Free Cash Flow 44% 41% 42% 38% 6% % Free Cash Flow Conversion (2) Implied Share Price 5.00x 4.25x 3.50x Terminal EBITDA Exit Multiple 9.6% 9.1% 8.5% 9.6% 9.1% 8.5% 9.6% 9.1% 8.5% Discount Rate Present Value of: 1,847 1,870 1,893 1,847 1,870 1,893 1,847 1,870 1,893 Forecasted Free Cash Flow 5,036 5,146 5,259 4,280 4,374 4,470 3,525 3,602 3,681 Terminal Value 6,883 7,016 7,152 6,127 6,244 6,363 5,372 5,472 5,574 Implied Aggregate Value (2,011) (2,011) (2,011) (2,011) (2,011) (2,011) (2,011) (2,011) (2,011) ( - ) Net Debt (3) 4,872 5,005 5,141 4,116 4,233 4,352 3,361 3,461 3,563 Implied Equity Value 175 175 175 175 175 175 175 175 175 Fully Diluted Shares (4) $27.91 $28.68 $29.46 $23.59 $24.25 $24.94 $19.26 $19.83 $20.42 Implied Price Per Share ($USD) 0% (0%) (1%) (1%) (2%) (2%) (3%) (4%) (4%) Implied Perpetuity Growth Rate 22% 26% 29% 3% 6% 9% (16%) (13%) (11%) % Premium / (Discount) to Unaffected (5) 64% 68% 73% 38% 42% 46% 13% 16% 20% % Premium / (Discount) to Current (6) 5.8x 6.0x 6.1x 5.2x 5.3x 5.4x 4.6x 4.6x 4.7x Implied AV / 2024E EBITDA 5.4x 5.5x 5.6x 4.8x 4.9x 5.0x 4.2x 4.3x 4.4x Implied AV / 2025E EBITDA Key Assumptions • July 30, 2024 valuation date January ending fiscal year • 4.5 - year DCF using mid - year discounting convention • WACC range of ~8.5% - 9.6% • Illustrative effective tax rate in years FY24E - FY28E of 27% • Terminal year assumptions (1) : – D&A equal to terminal year CapEx – Increase in NWC calculated from a 2% revenue growth into perpetuity 2028E 2027E 2026E 2025E 2H 2024E FYE February 3 17,074 16,433 15,819 15,272 7,720 Revenue • Financials presented on Unlevered Free Cash Flow Forecast (1) $MM, unless otherwise noted ILLUSTRATIVE DISCOUNTED CASH FLOW ANALYSIS | MANAGEMENT LONG - TERM PLAN Notes: 1. Terminal LTM EBITDA assumes 3.9% terminal revenue growth; 8.9% terminal EBITDA margin 2. Free Cash Flow Conversion represents Unlevered Free Cash Flow divided by Adjusted EBITDA 3. Net debt as of Q2 2024A; inclusive of $2,690MM of debt and $679MM of cash 4. Fully diluted shares of ~174.5MM; inclusive of ~164.2MM basic shares outstanding at Q2 2024 with full accelerated vesting of outstanding dilutive equity securities inclusive of ~0.7MM options, ~1.5MM PSUs, and ~8.1MM RSUs 5. Unaffected date as of March 18, 2024 6. Current market data as of September 3, 2024 Denotes range on FBF 30 Morgan Stanley
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Total (%) Amount ($) Multiple (x) Uses 55% $3,800 3.2x Purchase Equity 39% 2,690 2.3x Debt Roll 1% 100 0.1x Minimum Cash 2% 125 0.1x Transaction Fees 2% 140 0.1x SERP 100% $6,855 5.8x Total Uses Target Exit Multiple IRR 3.5x 3.9x 4.3x 4.6x 5.0x 17.5% $19.56 $20.56 $21.56 $22.56 $23.55 18.8% $19.24 $20.19 $21.14 $22.10 $23.05 20.0% $18.94 $19.85 $20.75 $21.66 $22.57 21.3% $18.65 $19.52 $20.38 $21.25 $22.12 22.5% $18.38 $19.21 $20.03 $20.86 $21.69 Total (%) Amount ($) Multiple (x) Sources 39% $2,690 2.3x Existing Debt 5% $325 0.3x New Transaction Debt 9% $620 0.5x Balance Sheet Cash 17% $1,146 1.0x Management Rollover 5% $362 0.3x Liverpool Rollover 25% $1,711 1.5x New Sponsor Equity (4) 100% $6,855 5.8x Total Sources Exit Multiple / Target IRR Implied $ per Share Key Assumptions • Offer price ($23.00 / share) (1) • Incremental $325MM in transaction debt funded through ABL (revolver upsized to $1.2Bn ABL facility at transaction close) (2) • Assumes incremental $325MM in transaction debt paid off 1 year after transaction close (12/31/25) • Min cash of $100MM • Assumes all excess cash flows paid out to Bid Group as dividends • Assumes Family and Liverpool roll current equity stakes • Effective tax rate of 27% • 4.5 - year hold, with illustrative closing date of Q2 2024 • Entry Multiple based on NTM EBITDA of $1.2Bn (3) • NTM Exit EBITDA of $1.6Bn Illustrative Sources and Uses $MM, unless otherwise noted 31 ILLUSTRATIVE LEVERAGED BUYOUT ANALYSIS | MANAGEMENT LONG - TERM PLAN Sources: Capital IQ; Management Long - Term Plan as of August 2024 for years FY24 - 28 Notes: 1. Reflects Bid Group offer at September 3, 2024 with assumed share count of ~165MM 2. Incremental $325MM draw from ABL at an assumed rate of SOFR + 200 bps 3. Net debt as of Q2 2024A; inclusive of $2,690MM of debt and $679MM of cash 4. Includes total new equity contributions from Family and Liverpool Denotes range on FBF Entry = Exit for 17.5 - 22.5% IRR A 20% Internal Rate of Return Implies an $21 Entry Price (~4.5x Entry Multiple) Morgan Stanley
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW High Low Base Notes Assumption 3.8% 3.8% 3.8% Spot Rate on 10 - Year U.S. Treasury as of 09/03/2024 Risk Free Rate (R f ) 6.0% 6.0% 6.0% Morgan Stanley Estimated Market Risk Premium Market Risk Premium (MRP) 1.66 1.66 1.66 Predicted U.S. Local Beta per Barra Predicted Beta 1.0% (1.0%) +/ - 1.0% from Base Sensitivity Adjustment 14.8% 12.8% 13.8% Calculated Using the Capital Asset Pricing Model Cost of Equity (K E ) 5.2% 5.2% 5.2% Weighted Average Cost of Debt Pre - tax Cost of Debt (K D ) 27.0% 27.0% 27.0% Per Management Guidance Tax Rate (t) 3.8% 3.8% 3.8% Post - tax Cost of Debt (K D ) 47.5% 47.5% 47.5% Based on Current Capital Structure Debt / Total Capitalization 9.6% 8.5% 9.1% KE * E/(D+E) + KD * (1 - t) * D/(D+E) Weighted Average Cost of Capital (WACC) WACC Calculation Key Assumptions • Cost of Equity: Calculated using the Capital Asset Pricing Model • Risk Free Rate: Based on 10 - year U.S. Treasury as of current market date of September 3, 2024 • Predicted Beta: Predicted U.S. Local Beta per Barra as of unaffected date of March 18, 2024 • Cost of Debt: Norse’s current blended cost of debt • Tax Rate: Implied long - term tax rate of 27% as provided in Management’s LTP • Capital Structure: Norse’s current debt / total capitalization ratio (1) ILLUSTRATIVE WEIGHTED AVERAGE COST OF CAPITAL ANALYSIS Sources: Company filings, Capital IQ as of unaffected date of March 18, 2024 and current market date of September 3, 2024 for Risk Free Rate Note: 1. Debt as of Q2 2024A and market value of Norse equity as of unaffected date of March 18, 2024 Morgan Stanley 32
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 33 APPENDIX C CENTERVIEW SUPPORTING VALUATION ANALYSIS
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 34 Centerview DISCOUNTED CASH FLOW ANALYSIS Assumes LTP Source: Norse management and Wall Street research. Note: Dollars in millions, except per share amounts and where otherwise noted. Share prices rounded to nearest $0.10. Assumes valuation date and balance sheet information as of August 3, 2024. Represents fiscals years ending January. (1) (2) (3) 2024E - 2028E reflects the five - year LTP reviewed with the Board in August 2024. Represents normalized depreciation & net working capital. Change in net working capital reflects midpoint of perpetuity growth rate range. EBITDA unburdened by amortization of developer reimbursements. Unlevered Free Cash Flow Detail Perpetuity Growth Rate Method Implied Share Price Implied Terminal LTM EBITDA Multiple Perpetuity Growth Rate 1.5% 2.0% 2.5% $25.60 $27.10 $28.70 $22.00 $23.20 $24.40 Perpetuity Growth Rate 1.5% 2.0% 2.5% 4.9x 5.2x 5.5x 4.5x 4.7x 4.9x WACC 11.00% 12.00% 13.00% $19.10 $20.00 $21.00 4.1x 4.3x 4.5x Projection Period (1) Terminal (2) 2028E 2027E 2026E 2025E H2'24 2023A $16,525 $16,525 $15,910 $15,319 $14,792 $7,492 $14,219 Net Sales $1,521 $1,521 $1,406 $1,340 $1,276 $681 $1,153 EBITDA (3) (474) (532) (530) (571) (602) (294) (586) ( - ) Total D&A (283) (267) (236) (208) (182) (98) (13) ( - ) Taxes $764 $722 $639 $561 $492 $289 $554 NOPAT 474 497 493 531 552 265 517 (+) D&A, Net – 35 37 40 50 29 69 (+) Developer Reimbursement Amort. (86) (86) (83) (81) (80) (41) (88) ( - ) Cash Lease Expense Adj. (16) (28) (49) (51) (104) (226) (169) ( - ) Δ in NWC (474) (474) (457) (440) (422) (273) (569) ( - ) Capex $663 $665 $580 $560 $488 $43 $314 Unlevered FCF
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 35 ILLUSTRATIVE WACC ANALYSIS Source: Company filings, Kroll, Bloomberg and FactSet as of September 3, 2024. Note: U.S. dollars in millions. (1) Represents two - year weekly adjusted beta (based on local index) per Bloomberg. (2) Calculated as (Levered Beta / (1 + ((1 - Tax Rate) * Debt / Equity)). (3) Figure excludes finance leases. (4) Reflects current U.S. 20 - year treasury note yield. (5) Reflects median of unlevered betas of comparable group. (6) Reflects median peer debt / equity. (7) Reflects levering of the median unlevered beta of the peers at target debt / equity ratio. Levered Beta = (Unlevered Beta) * (1 + (1 - Tax Rate) * (Debt / Equity)). (8) Reflects U.S. Long - Horizon Equity Risk Premium per Kroll. (9) Reflects size premium per Kroll Valuation Handbook. (10) Calculated as Risk - Free Rate + (Historical Risk Premium * Levered Beta) + Size Premium. (11) Assumes illustrative cost of debt based on trading yields on bonds for Norse prior to takeover rumors and selected peers. (12) Reflects Norse management long - term tax rate. (13) WACC equals ((Debt/Capitalization) * After - Tax Cost of Debt) + (Equity/Capitalization * Levered Cost of Equity)). 83% 1,945 (3) 2,357 1.08 1.78 Kohl's 73% $2,485 $3,394 1.04 1.67 Peer Median 68% $2,690 $3,983 1.26 1.88 Norse WACC Analysis Beta Levered (1) Unlevered (2) 1.55 1.01 Market Cap. Debt / Equity Company Debt Macy's 4,430 3,024 68% Peer - Based WACC Risk - Free Rate (4) 4.16% Unlevered Beta (5) 1.04 Debt / Equity (6) 73% Levered Beta (7) 1.60 Historical Risk Premium (8) 7.17% Size Premium (9) 0.95% Cost of Equity (10) 16.6% Pre - Tax Cost of Debt (11) 7.25% Tax Rate (12) 27.0% After - Tax Cost of Debt 5.3% Centerview 11.8% WACC (13) 1.25 1.20 1.15 1.10 1.05 1.00 Equity Cap. 50% 33% 42.3% D / (D+E) 75% 43% 57.7% E / (D+E) 100% 50% 125% 56% 13.3% 13.0% 12.7% 12.3% 12.0% 11.7% 13.1% 12.8% 12.5% 12.2% 11.8% 11.5% 13.0% 12.6% 12.3% 12.0% 11.7% 11.4% 12.8% 12.5% 12.2% 11.9% 11.6% 11.3% WACC Sensitivity Analysis (Peer - Based) (13) Debt / Debt / Unlevered Beta
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 36 NORSE COMPARABLE COMPANIES ANALYSIS Source: Norse management, company filings, FactSet and Capital IQ as of September 3, 2024. Note: Dollars in millions except per share figures. (1) Norse LTP EBITDA figures add back amortization of developer reimbursement for comparison to consensus EBITDA. (2) EBIT and EBITDA reflect adjusted figures. (3) Debt figures do not include leases and LTM EBITDA does not add back rent. (4) CAGR reflects total revenue given available broker estimates. (5) Norse figures as of unaffected date of March 18, 2024. Selected Department Store Peers Centerview Leverage (3) Leverage (3) 2024E 2023A EBIT (2) EBITDA (1,2) Net Sales 2025E 2024E 2023A Value Cap Wk. High Price Company 1.3x 1.5x 5.0% 6.1% (13.0%) (7.2%) (2.0%) 3.4x 3.4x 2.9x $6,770 $4,430 (28.1%) $15.49 Macy's 3.1x 3.3x 3.8% 4.3% (8.8%) (4.2%) (2.8%) 5.0x 5.0x 4.6x 6,726 2,357 (30.9%) 20.30 Kohl's 2.2x 2.4x 4.4% 5.2% (10.9%) (5.7%) (2.4%) 4.2x 4.2x 3.8x Peer Median (0.6x) 0.5x 10.3% 13.5% (18.0%) (19.6%) (4) (2.0%) 7.1x 5.9x 4.6x 5,037 5,586 (27.4%) Memo: Dillard's $345.29 1.7x 2.3x 3.6% 4.0% (0.3%) 0.9% 3.1% 5.1x 5.3x 5.2x 5,994 3,983 (4.2%) Current Norse (Cons.) $22.82 1.7x 2.3x 4.0% 4.0% 9.1% 5.2% 2.0% 4.7x 5.1x 5.2x 5,994 3,983 (4.2%) Norse (Mgmt.) $22.82 Unaffected (5) 1.7x 2.3x 3.5% 4.0% (2.5%) (1.2%) 2.5% 4.6x 4.7x 4.5x 5,200 2,891 (26.8%) $17.06 Norse (Cons.) 1.7x 2.3x 4.0% 4.0% 9.1% 5.2% 2.0% 4.1x 4.4x 4.5x 5,200 2,891 (26.8%) $17.06 Norse (Mgmt.) Share % of 52 - Market Aggregate AV / Adj. EBITDA (1) '23A - '25E CAGR EBIT Margin Gross Net
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 37 PRECEDENT INDUSTRY TRANSACTIONS Selected U.S. Department Store Transactions Source: Company filings, FactSet and Wall Street research. Note: Dollars in billions. (1) Based on Wall Street broker estimates for CY 2024. Centerview AV / LTM EBITDA AV / LTM Revenue Aggregate Value Acquiror Announcement Date Target 6.3x 0.68x $2.8 Sycamore Partners Aug - 15 Belk 9.1x 1.31x 6.1 CPPIB & Ares Sep - 13 Neiman Marcus 10.9x 0.91x 2.9 HBC Jul - 13 Saks 9.1x 0.91x 2.9 Median 8.8x 0.97x 3.9 Average Memo - Unconsumated Transactions Jul - 24 Neiman Marcus HBC Jun - 24 Macy's Arkhouse & Brigade $2.7 ~0.6x ~8.6x 9.2 0.39x 4.1x Macy’s Board unanimously determined that the proposal remains non - actionable and fails to provide compelling value to Macy’s shareholders Transaction remains contingent on additional financing (1) (1) (Proposal Date)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Disclosed Valuation Details Date Price Target Rating Firm Name Discounted Cash Flow 8/27/2024 $38.50 Buy Morningstar ~12.5x FY2025 EPS 8/27/2024 $25.00 Hold TD Cowen 9.3x 2025E P/E and 5.7x 2025E AV / EBITDA 8/27/2024 $24.00 Buy KeyBanc 11.7x 2026E EPS 8/28/2024 $24.00 Hold Telsey ~12.0x FY2025 EPS 8/27/2024 $23.00 Hold Gordon Haskett ~5.0x FY2024 AV / EBITDA 8/28/2024 $22.00 Hold Citi ~10x FY2025 EPS 8/27/2024 $22.00 Hold BMO 10.0x 2025E EPS 8/27/2024 $19.00 Hold Evercore 4.3x 2026E AV / EBITDA 8/28/2024 $20.00 Sell JP Morgan 9.0x NTM P/E Multiple based on CY2026 EPS 8/27/2024 $18.00 Sell Barclays 4.75x Q5 - Q8 AV / EBITDA Estimates 8/27/2024 $21.00 Hold Goldman Sachs 5.0x FY2025 AV / EBITDA 8/28/2024 $20.00 Sell Bank of America 10.0x FY2025 P/E 8/28/2024 $20.00 Hold Jefferies ~0.3x FY2026E AV / Sales 8/27/2024 $13.00 Sell UBS NA 8/28/2024 NA Hold Guggenheim NA 8/28/2024 NA Hold William Blair NA 8/28/2024 NA NA Morgan Stanley $21.00 Median (1) $20.85 Mean (1) Present Value: $18.32 (2) Present Value: $18.46 (2) CURRENT SHARE PRICE REPRESENTS A PREMIUM TO PRESENT VALUE OF MEDIAN PRICE TARGETS As of Latest Quarterly Earnings Released on August 27, 2024 38 Analyst price targets above unaffected Norse share price of $17.06 and below current share price of $22.82 Source: Wall Street Equity Research, Market Data as of September 3, 2024. (1) Morningstar Price Target excluded from median and mean calculations.
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 39 APPENDIX D MARKET PERSPECTIVES ON THE DEPARTMENT STORE SECTOR
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 40 INVESTOR PERSPECTIVES ON THE DEPARTMENT STORE SPACE Bearish investor sentiment regarding the Department Store space continues to weigh on Norse • Declining market share due to greater competition • Department Store margins in secular decline • Channel shift to lower margin E - Commerce sales • Weak future earnings growth prospects • Brands shifting to DTC reduces reliance on Department Store channel • Higher reliance on adjacent sources of revenue / income (e.g., Credit Card Fee Share) rather than core category sales • Recent activity underscores broader strategic action in the space – Macy’s attempted take - private – Consolidation between Neiman Marcus Group and Saks Fifth Avenue
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 41 $25 / 8% $53 / 16% $98 / 26% $164 / 39% $15 / 5% $22 / 6% $30 / 8% $36 / 9% $205 / 69% $218 / 64% $207 / 56% $192 / 46% $53 / 18% $49 / 14% $36 / 10% $27 / 6% $298 $342 $370 $420 2008 2015 2019 2023 Other Retail Department Store Off - Price E - Commerce % of Total DEPT STORES HAVE LOST $26BN OF VALUE OVER THE LAST 15 YEARS Source: Euromonitor. Note: Dollars in billions. Other Retail includes Grocery Retailers, Variety Stores, Apparel & Footwear Specialty, Sports Goods Specialty, Other Non - Grocery Retailers and Direct Selling. +16% (1%) (2%) E - Commerce not only taking all retail growth, but now cannibalizing traditional retail as COVID gains prove sticky Retail cannibalized by E - Commerce, but pockets of growth still exist +11% (7%) (1%) CAGRs +2% +3% +2% +1% Overall ’18 - ’23 $ Change +$139bn ($13bn) ($26bn) +$22bn U.S. Apparel & Footwear Retail Sales Over Time ($bn)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 42 3.4x 5.2x 3.2x 15.8x 13.8x 7.6x 5.9x 5.2x 7.8x 9.7x 17.7x 16.3x 21.9x 9.3x 5.0x 5.6x 6.8x 15.9x 15.0x 12.3x 9.0x 13.8x 20.3x 21.8x 26.6x 15.3x 11.6x 10.4x NTM P/E +3% +5% +1% +5% +1% +1% (2%) ’23 - ’25E Net Sales CAGR (8) 11% 9% 13% 11% 4% 7% 4% NTM EBIT Margin DIVERGENT INVESTOR ENTHUSIASM ACROSS RETAIL, DRIVEN BY FUNDAMENTALS Source: Company filings, FactSet and Capital IQ as of September 3, 2024. Note: EBITDA figures unburdened by amortization of developer reimbursements. (1) Department Stores peers include Kohl’s, Macy’s and Norse. (2) Apparel Retail peers include Abercrombie, American Eagle, Children’s Place, Foot Locker, Gap, Guess and Victoria’s Secret. (3) Specialty Retail peers include Academy Sports, Best Buy, Dick’s Sporting Goods, Office Depot and Petco. (4) Off - Price peers include Burlington, Ross and T.J. Maxx. (5) Home Improvement peers include Home Depot and Lowe’s. (6) Growth Retail peers include Five Below, Floor and Décor, Tractor Supply and Ulta Beauty. (7) Apparel peers include Levi’s, PVH and Ralph Lauren. Excludes VF Corp. (8) Reflects fiscal years ending January the following calendar year. Department Stores (1) Off - Price (4) Apparel Retail (2) Home Improvement (5) Growth Retail (6) Specialty Retail (3) Apparel (7) Category Medians: Minimum Median Maximum Forward Valuation Multiples: AV / NTM EBITDA Retail Other Relevant
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 43 FY'23 FY'22 FY'21 FY'19 FY'18 FY'17 FY'16 FY'15 FY'14 R² = 0.97 4x 5x 6x 7x 8x 9x 0% +2% +4% +6% +8% Forward Sales Growth (2) +10% Macy's Kohl's Burlington TJX Ross R² = 0.61 2x 4x 6x 8x 10x 12x 14x 16x 18x 20x (5%) (2%) +1% +4% +7% +10% +13% ’23A - ’25E Sales CAGR (1) Potential Drivers GROWTH AND MARGIN ARE KEY DRIVERS OF INDUSTRY MULTIPLES Source: Company filings and FactSet as of September 3, 2024. (1) (2) (3) Reflects Net Sales CAGR for Norse, Macy’s and Kohl’s. Represents Revenue CAGR for all other peers. Reflects 2 - year forward net sales growth. Defined as the difference of the high and low 2025 estimate divided by consensus. Average AV / NTM EBITDA per Fiscal Year AV / NTM EBITDA Dept. Store and Retail Peers Today Norse Over Time More Correlated Less Correlated R 2 EPS Estimate Dispersion (3) 0.46 EBIT Estimate Dispersion (3) 0.49 EBIT Margin (NTM) 0.56 EPS Growth (NTM) 0.14 Net Sales Estimate Dispersion (3) 0.35 FY’20 (excl. from regression) Sales Beat % - - Last 30 Quarters 0.04 ’22 - ’24E EBIT Margin Expansion 0.04 Apparel Retail Home Improvement Growth Retail Apparel Specialty Retail Norse Multiple vs. Sales Growth Other Regressions on Multiple
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 44 APPENDIX E INVESTOR PERSPECTIVES ON NORSE'S VALUATION MULTIPLE
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 45 INVESTOR PERSPECTIVES ON NORSE’S VALUATION MULTIPLE • Most investors view the Department Store category as being in secular decline • End - markets are shrinking, overall uncertainty is rising, and competition is increasing as consumers are faced with more alternatives than ever before • Given its historical performance, Norse will likely need to beat Street Consensus and raise expectations consistently for several years, meaningfully inflecting key drivers like revenue and profit growth and demonstrating a more sustainable margin profit, to change investors’ bearish sentiment • As a result, even when Norse results fare well, investors remain uncertain on Norse’s ability to deliver future topline and profit growth which is compounded by significant operating leverage and its impact on profitability • Even if Norse achieves the LTP, or becomes the winning consolidator in the space, the public markets may not re - rate its valuation multiple given the overarching unfavorable Department Store dynamics at play • While there are examples of retailers successfully re - rating their multiple, they typically require a catalyst and high degree of clarity / confidence on long - term strategy that results in re - rating, combined with dramatically step - changed financial performance
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 0 50 100 150 200 250 300 Sep - 19 Mar - 20 Sep - 20 Mar - 21 Sep - 21 Mar - 22 Sep - 22 Mar - 23 Sep - 23 (19.6%) (56.1%) +7.6% Norse Unaffected Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 26.9% (23.2%) 27.5% (24.3%) 42.0% 3.0% L1Y ∆ 85.0% (32.3%) (9.4%) (36.4%) 29.1% (36.5%) L2Y ∆ 31.5% (63.6%) (28.7%) 51.0% (15.7%) (59.9%) L3Y ∆ 44.4% (56.1%) 7.6% (45.1%) (19.6%) (61.4%) L5Y ∆ Macy's Unaffected 46 SECTOR SHARE PRICE PERFORMANCE OVER TIME Source: Capital IQ as of September 3, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of September 3, 2024 3. Represents Macy’s as of unaffected date of December 8, 2023 Share Price Performance Over Time Indexed to 100; Since September 3, 2019 (3) (1) (4) Post Norse Unaffected Period To Current (2) December 8, 2023: Macy’s unaffected share price of $17.39 May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; Share Price increased +5.1% day after earnings January 22, 2024: Macy’s announces it will not enter into an agreement with Arkhouse and Brigade March 18, 2024: Norse unaffected share price of $17.06 August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; Share Price increased +4.2% day after earnings Mar - 24 Sep - 24 July 3, 2024: Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal July 15, 2024 4. Off - Price Retail Peers include ROST, TJX and BURL Macy’s terminates discussions with Arkhouse and Brigade
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 2.0x 0.0x 4.0x 6.0x 8.0x 10.0x 12.0x Sep - 19 Mar - 20 Sep - 20 Mar - 21 Sep - 21 Mar - 22 Sep - 22 Mar - 23 Sep - 23 5.2x 5.1x 3.4x 4.1x 4.6x 3.6x Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 15.6x 5.1x 3.4x 3.7x 5.2x 4.7x Today 14.8x 5.2x 3.4x 3.1x 5.2x 4.4x L1Y Avg. 14.3x 5.2x 3.3x 3.2x 5.2x 4.4x L2Y Avg. 13.6x 4.9x 3.4x 3.8x 4.9x 5.0x L3Y Avg. 14.6x 5.0x 4.4x 4.5x 5.2x 5.2x L5Y Avg. 47 SECTOR VALUATION MULTIPLES OVER TIME Source: Capital IQ as of September 3, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of September 3, 2024 3. Represents Macy’s as of unaffected date of December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL AV / NTM EBITDA Over Time Since September 3, 2019 Macy's Unaffected (3) Norse Unaffected (1) (4) Post Norse Unaffected Period To Current (2) December 8, 2023: Macy’s unaffected multiple of 3.7x November 17, 2022: Kohl’s announces they will not engage in transformative transactions; multiple of 5.6x January 21, 2022: Kohl’s unaffected multiple of 4.0x January 24, 2022: News of takeover offer; Kohl’s affected multiple of 5.1x May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; multiple of 5.1x March 18, 2024: Norse unaffected multiple of 4.7x August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; multiple of 5.5x Mar - 24 Sep - 24 July 3, 2024: Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW $17.06 $18.66 $18.74 $19.98 $21.03 $21.14 – 15.0 20.0 10 15 20 25 30 35 3/15 8/30 +33.8% $22.82 10.0 5.0 (27.1%) (18.9%) 48 NORSE’S SHARE PRICE SINCE UNAFFECTED DATE Source: Capital IQ Note: 1. Market data as of September 3, 2024 Share Price Performance and Trading Volume Over Time (1) Since March 18, 2024 Norse Volume (MM) Share Price ($) April 18, 2024: Erik and Pete Nordstrom file Schedule 13D; Announce formation of Special Committee May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket. Beats on consensus revenue estimates, misses on EPS, and reaffirms guidance Average Volume: 2.9MM Norse Macy’s Kohl’s March 19, 2024: Reuters report of Norse’s potential take - private Volume (MM) March 18, 2024: Unaffected date May 2, 2024: Rumors of Sycamore Partners’ participation on potential take - private transaction August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket. In - line with consensus revenue estimates and beats on consensus EBIT and EPS estimates. Raised low - ends of all guidance ranges 3/18 3/21 3/27 4/3 4/9 4/15 4/19 4/25 5/1 5/7 5/13 5/17 5/23 5/30 6/5 6/11 6/17 6/24 6/28 7/5 7/11 7/17 7/23 7/29 8/2 8/8 8/14 8/20 8/26 9/3
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 49 2.0x 2.5x 3.0x 3.5x 4.5x 5.5x 6.0x Aug - 22 4.1x 4.0x Nov - 22 Feb - 23 May - 23 Aug - 23 Nov - 23 Feb - 24 May - 24 Aug - 24 PEER NTM AV/EBITDA MULTIPLES OVER TIME (SINCE 2022) Source: Company filings, FactSet as of September 3, 2024. 3.0x 5.2x 5.0x 3.4x +15.5% 5.2x +26.1% 5.1x (2.9%) Norse Macy’s Kohl’s AV / NTM EBITDA Multiple Since 2022 July 4, 2024: HBC / Neiman announced Median Peer NTM Multiple: 4.7x Dec. 8, 2023: Leak of buyout bid from Arkhouse Management & Brigade Capital of $21 per share Median Peer NTM Multiple: 4.9x March 19, 2024: Leak of Norse take - private Median Peer NTM Multiple: 4.9x
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 50 Long - Term Growth / PGR 4.00% 4.50% 5.00% 5.50% 6.00% (0.5%) 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 2.8x 2.9x 3.0x 3.1x 3.3x 3.4x 3.6x 3.2x 3.3x 3.4x 3.6x 3.7x 3.9x 4.1x 3.5x 3.7x 3.8x 4.0x 4.2x 4.4x 4.6x 3.9x 4.1x 4.2x 4.4x 4.6x 4.8x 5.1x 4.3x 4.4x 4.6x 4.8x 5.1x 5.3x 5.6x Terminal EBIT Margin UNDERSTANDING NORSE’S MULTIPLE THROUGH POTENTIAL INVESTOR LENS ▪ Given uncertainty in outlook, investors may be contextualizing valuation based on a handicapped view of the go forward cash flow of the business ▪ Current multiple implies investors are factoring in a conservative view of 0% – 2% topline growth and moderate margin expansion ▪ Executing LTP may raise EBITDA, but material re - rating contingent on: – Conviction in sustainability of long - term growth potential and ability to increase margin ; and/or – Investor’s underwriting lower discount rate driven by increased certainty Consensus Implied AV / FY’24E EBITDA Multiple Sensitivity Source: Company filings, FactSet and Capital IQ as of September 3, 2024. Note: DCF illustratively assumes 11.8% weighted average cost of capital, valuation date of August 3, 2024 and applies mid - period discounting. Approximate unaffected AV / ’24E EBITDA multiple
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 51 NORSE HISTORICAL SHARE PRICE PERFORMANCE DRIVEN BY EARNINGS Norse Share Price Decomposition – Last 5 Years NTM EBITDA AV/NTM EBITDA 5.1x $1,637 ($522) (0.5x) $1,114 4.7x Source: Company filings, FactSet and Capital IQ. Note: EBITDA figures unburdened by amortization of developer reimbursements. (1) Reflects April 25, 2015. (2) Reflects change in share count and net debt. (3) Reflects unaffected date of March 18, 2024. $41.05 ($16.78) ($3.21) ($4.00) $17.06 (1) Apr - 19 Δ in Fwd. EBITDA Estimate Δ in AV / EBITDA (2) Δ in Capital Structure (3) Mar - 24
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 52 Source: Company Materials NORSE’S PROFITABILITY HAS ERODED OVER TIME $369 $401 $336 $336 FY2010A FY2015A FY2019A FY2023A 8% 20% 33% 36% FY2010A FY2015A FY2019A FY2023A 12.0% 8.0% 5.4% 3.9% FY2010A FY2015A FY2019A FY2023A Declining Store Productivity Store Only Sales / Avg. Gross Sq. Ft. ($MM) Increased Online Penetration Digital Mix (% of Net Sales) Declining Margins EBIT Margin (%) 7.7% 8.6% 5.4% 5.9% 4% 14% 26% 33% $154 $162 $149 $148 11.4% 8.1% 6.4% 4.1% 4% 14% 24% 29% $188 $165 $144 $118 Macy’s Kohl’s
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 53 7.4% FY2023A FY2024E FY2025E Memo: Consensus % Margin 7.8% 7.6% 7.7% $1.1 $1.2 $1.2 $1.2 $1.2 $1.3 $1.3 FY2026E 1.6% FY2023A FY2024E FY2025E Memo: Consensus % Growth (5.4%) 0.5% 1.8% $14.8 $15.0 $15.3 $14.7 $14.9 $15.3 $15.8 $15.7 FY2026E 3.4% FY2023A FY2024E FY2025E Memo: Consensus % Margin 3.9% 3.7% 3.8% $0.5 $0.6 $0.5 $0.6 $0.6 $0.7 $0.8 FY2026E Total Revenue ($bn) BROAD UNCERTAINTY ON NORSE NEAR - TERM OUTLOOK ACROSS THE STREET Source: Norse management, company filings, Wall Street research, FactSet and Capital IQ as of September 3, 2024. Note: Figures reflect fiscal years ending January the following calendar year. (1) Adj. EBITDA is unburdened by amortization of developer reimbursements. Consensus (shading represents range of analyst estimates) Management’s Current LTP $0.5 $0.6 Adj. EBIT ($bn) $14.5 Adj. EBITDA (1) ($bn) $1.3 $0.9
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 54 Norse Aug. 2024 Mgmt. LTP Norse Aug. 2024 Mgmt. LTP (131) (1) $375 $277 $388 $351 $141 $199 $221 $150 $181 $816 $567 $768 2019A 2023A 2026E 704 $4,459 $4,727 23 $4,905 $3,904 $3,770 $4,739 $6,065 $5,698 $5,675 $15,132 $14,219 $15,319 2019A 2023A 2026E NORSE’S PERFORMANCE EXPECTED TO BE DRIVEN BY RACK AND E - COMMERCE Net Sales EBIT Source: Norse management and Euromonitor. (1) (2) E - Comm market share reflects Net GMV. Segment EBIT margins burdened by allocated corporate expenses. CAGRs Market Share: N Stores 17.0% 21.1% 24.6% R Stores 13.2% 10.4% 10.9% E - Comm (1) 4.6% 2.9% 2.7% EBIT Margin (2) : N Stores 3.6% 2.6% 3.2% R Stores 9.0% 3.7% 4.2% E - Comm 8.4% 5.9% 7.9% Norse 5.4% 4.0% 5.0% Norse Stores E - Comm Discontinued Businesses Rack Stores
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW APPENDIX F RATINGS CONSIDERATIONS 55
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Reflects related agency metric as of historical trailing twelve months at fiscal Q2 2024 2. Agency debt adjustments: Moody’s includes operating leases, pensions, and non - standard adjustments; S&P includes operating leases, pensions, and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 3. Agency EBITDAR adjustments: Moody’s includes operating lease expense, pensions, and unusual items; S&P includes operating lease expense, pensions, stock - based compensation, and other; Fitch includes operating lease expense and other 56 NORSE’S CURRENT RATINGS SCORECARD Key Financial Metrics: – Debt / EBITDAR – RCF / Net Debt – EBIT / Interest Other Factors for Ratings Downgrade: – Liquidity maintenance – EBIT to interest expense sustained below 3.25x – Debt / EBITDAR sustained above 4.0x – Lack of improvement in op margins – Rack changes unsuccessful – More aggressive financial strategies Ratings Considerations $4.4Bn Moody’s Debt Estimated Current Agency Adjusted Ratios (1)(2)(3) $1.4Bn Moody’s EBITDAR 3.2x Moody’s Leverage Leverage Breakpoints Rating Illustrative Leverage Breakpoints Debt/EBITDAR <2.5x Baa3 Debt/EBITDAR <3.25x Ba1 Debt/EBITDAR <4.0x Ba2 Debt/EBITDAR <4.75x Ba3 Debt/EBITDAR <5.75x B1 Leverage Breakpoints Rating Debt/EBITDAR <2.5x BBB - Debt/EBITDAR <3.0x BB+ Debt/EBITDAR <4.0x BB Debt/EBITDAR <5.0x BB - Debt/EBITDAR <6.0x B+ Leverage Breakpoints Rating Debt/EBITDAR <3.0x BBB - Debt/EBITDAR <3.5x BB+ Debt/EBITDAR <4.0x BB Debt/EBITDAR <5.0x BB - Debt/EBITDAR <6.0x B+ Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) Key Financial Metrics: – Debt / EBITDAR – FFO / Debt Key Financial Metrics: – Debt / EBITDAR – FCF Margin Current Rating $3.8Bn S&P Debt $1.5Bn S&P EBITDAR 2.6x S&P Leverage $5.7Bn Fitch Debt $1.5Bn Fitch EBITDAR 3.9x Fitch Leverage Other Factors for Ratings Downgrade: – Maintaining Debt / EBITDAR above 3.0x on a sustained basis – Weaker than expected sales in full line and off - price segments – Adj. EBITDA margins remain below 10% – More aggressive financial policy Other Factors for Ratings Downgrade: – Reasonable cash flows for accelerated strategic investments – Sustained structural advantages across the retail space – EBITDA trending below $1.0Bn, which would yield EBITDAR leverage sustaining above 4.0x Morgan Stanley
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 57 NORSE CREDIT RATINGS OVER TIME Last 15 years Source: Moody’s, S&P, Fitch and Refinitiv Eikon. Note: Fitch suspended its rating in June 2020 before reinstating a BBB - rating in March 2021. Change in Rating Change in Outlook S&P Moody’s Fitch BBB+ A - BB+ BBB - 2008 2010 2012 2014 2016 2018 2020 2022 2024 Apr - 09: BBB+ Stable Mar - 10: Positive Outlook Feb - 11: A - Stable Feb - 16: BBB+ Stable Aug - 16: Negative Outlook BBB - Stable Oct - 19: Mar - 20: Negative Outlook Sep - 20: BB+ Negative Mar - 21: Jan - 23: Stable Negative Outlook Outlook Baa1 Baa2 Baa3 Ba1 Ba2 Mar - 09: Baa2 Negative Jan - 10: Stable Outlook Feb - 11: Baa1 Stable Jun - 19: Negative Outlook Oct - 19: Baa2 Stable Apr - 20: Baa3 Negative Sep - 21: Ba1 Stable Apr - 23: Negative Outlook Apr - 24: Ba2 Stable A - BBB+ BBB - BB+ BB BBB Nov - 04: A - Mar - 15: BBB+ Mar - 20: BBB Mar - 21: BBB - Jan - 23: BB+ Apr - 24: BB Jan - 16: Negative Watch Centerview
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 3.6x 2.7x 2.2x BB - 5.0x BB 4.0x 3.9x 2024PF 2025E 2026E 2.9x 2.4x 2.0x Ba3 4.8x Ba2 4.0x 3.2x 2024PF 2025E 2026E 2.8x BB 4.0x BB+ 3.0x 1.9x 1.5x 2.6x 2024PF 2025E 2026E Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) Agency - Defined Debt ($Bn) (5) Agency - Defined EBITDAR ($Bn) (6) Projected Leverage Ratio (1)(2)(3) $3.9 $4.5 $5.6 $2.6 $3.1 $4.2 $3.2 $3.8 $4.2 $1.7 $1.6 $1.5 $1.7 $1.6 $1.5 $1.6 $1.6 $1.4 Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Pro forma; assumes $23.00 offer price, transaction close on February 1, 2025, minimum cash balance of $100MM, all excess cash used to pay down debt, and management and Liverpool roll current ownership interests Ratings Triggers Current (4) LEVERAGE NEUTRAL TRANSACTION Management Long - Term Plan Morgan Stanley 2. Projections based on Management Long - Term Plan as of August 2024 3. Agency ratings trigger ratios, per agency - defined total debt, net debt, and EBITDAR: Moody’s reflects total debt / EBITDAR, S&P reflects net debt / EBITDAR, and Fitch reflects total debt / EBITDAR 4. Reflects estimate of related agency metric as of historical trailing twelve months at fiscal Q2 2024; reflects cash paydown of April 2024 notes ($250MM) 5. Agency debt adjustments: Moody’s includes operating leases and non - standard adjustments; S&P includes operating leases and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 6. Agency EBITDAR adjustments: Moody’s includes operating lease expense and unusual items; S&P includes operating lease expense, stock - based compensation, and other; Fitch includes operating lease expense and other 58
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 3.8x 2.9x 2.3x BB - 5.0x BB 4.0x 3.9x 2024PF 2025E 2026E 3.2x 2.7x 2.0x Ba3 4.8x Ba2 4.0x 3.2x 2024PF 2025E 2026E 3.0x 2.2x 1.6x 2.6x BB 4.0x BB+ 3.0x 2024PF 2025E 2026E Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) Agency - Defined Debt ($Bn) (5) Agency - Defined EBITDAR ($Bn) (6) Projected Leverage Ratio (1)(2)(3) $3.9 $4.8 $5.9 $2.6 $3.5 $4.6 $3.3 $4.1 $4.6 $1.7 $1.6 $1.5 $1.7 $1.6 $1.5 $1.6 $1.6 $1.4 Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Pro forma; assumes $23.00 offer price, transaction close on February 1, 2025, minimum cash balance of $100MM, excess cash used to pay down debt, management and Liverpool roll current ownership interests and incremental $325MM of debt drawn via new ~$1.2Bn ABL at an assumed rate of SOFR + 200 bps Ratings Triggers Current (4) OFFER LEVERAGE OF $325MM Management Long - Term Plan Morgan Stanley 2. Projections based on Management Long - Term Plan as of August 2024 3. Agency ratings trigger ratios, per agency - defined total debt, net debt, and EBITDAR: Moody’s reflects total debt / EBITDAR, S&P reflects net debt / EBITDAR, and Fitch reflects total debt / EBITDAR 4. Reflects estimate of related agency metric as of historical trailing twelve months at fiscal Q2 2024; reflects cash paydown of April 2024 notes ($250MM) 5. Agency debt adjustments: Moody’s includes operating leases and non - standard adjustments; S&P includes operating leases and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 6. Agency EBITDAR adjustments: Moody’s includes operating lease expense and unusual items; S&P includes operating lease expense, stock - based compensation, and other; Fitch includes operating lease expense and other 59
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 4.0x 3.1x 2.3x BB - 5.0x BB 4.0x 3.9x 2024PF 2025E 2026E Ba3 4.8x Ba2 4.0x 3.3x 2.8x 2.0x 3.2x 2024PF 2025E 2026E 3.1x 2.3x 1.6x 3.0x 2.6x BB 4.0x BB+ 2024PF 2025E 2026E 60 Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) Agency - Defined Debt ($Bn) (5) Agency - Defined EBITDAR ($Bn) (6) Projected Leverage Ratio (1)(2)(3) $3.9 $5.0 $6.1 $2.6 $3.7 $4.8 $3.3 $4.3 $4.8 $1.7 $1.6 $1.5 $1.7 $1.6 $1.5 $1.6 $1.6 $1.4 Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Pro forma; assumes $23.00 offer price, transaction close on February 1, 2025, minimum cash balance of $100MM, excess cash used to pay down debt, management and Liverpool roll current ownership interests and incremental $500MM of debt drawn via new ~$1.2Bn ABL at an assumed rate of SOFR + 200 bps 2. Projections based on Management Long - Term Plan as of August 2024 3. Agency ratings trigger ratios, per agency - defined total debt, net debt, and EBITDAR: Moody’s reflects total debt / EBITDAR, S&P reflects net debt / EBITDAR, and Fitch reflects total debt / EBITDAR 4. Reflects estimate of related agency metric as of historical trailing twelve months at fiscal Q2 2024; reflects cash paydown of April 2024 notes ($250MM) 5. Agency debt adjustments: Moody’s includes operating leases and non - standard adjustments; S&P includes operating leases and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 6. Agency EBITDAR adjustments: Moody’s includes operating lease expense and unusual items; S&P includes operating lease expense, stock - based compensation, and other; Fitch includes operating lease expense and other Ratings Triggers Current (4) ILLUSTRATIVE INCREMENTAL DEBT OF $500MM Management Long - Term Plan Morgan Stanley
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 61 APPENDIX G PROCESS SUMMARY
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 24 11 8 7 1 1 Initial Outreach / Inbounds NDA Signed Management Presentation Follow - up Requests Received Indication of Interest Received Final Offer OUTREACH SUMMARY Strategic Partner Sovereign Wealth Fund / Family Office Financial Sponsor Note: 1. Management conducted a virtual preview meeting with December 13, 2023 Verbal Indication for Financing Sale Leaseback + Perpetual Preferred Investment with 13% coupon Remaining Strategic Partners (1) 1) Group + Family Offer 62
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Counterparty Outreach Date / NDA Management Inbound Signed Meeting Date Management Meeting Details Management Meeting Attendees Follow Up Session Date Status Final Offer 1/7/24 ᴣ 1/18/24 Meeting at Centerview Partners (NYC) 1/30/24 Passed 1/8/24 ᴣ 2/2/24 Meeting at Norse Headquarters and store walk 2/9/24 Passed Moelis ᴣ 3/19/24 Meeting at Norse Headquarters Passed Inbound week of 3/18 ( ) Passed 1/8/24 ᴣ 1/29/24 Meeting at Morgan Stanley (LA) Passed 1/9/24 ᴣ 1/17/24 Meeting at Centerview Partners (NYC) Passed Inbound ᴣ 1/17/24 Meeting at 1/26/24 Passed 10/31/23 ᴣ Passed 11/1/23 Passed 10/31/23 ᴣ Passed Inbound ᴣ 6/05/24 Virtual Passed 11/26/23 ᴣ 1/25/24 Meeting at Morgan Stanley, store walk and dinner (LA) • Graciano Guichard Gonzalez, Chief Executive Officer • Enrique Güijosa Hidalgo, Chief Financial Officer 8/15/24 Bid Received $23.00 / share Inbound Passed Financial Sponsors 7 Strategic Partners 6 Note: 1. Management conducted a preview meeting with 12/13/23 on Zoom
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW OUTREACH SUMMARY Status Follow Up Session Date Management Meeting Date NDA Signed Outreach Date Counterparty Passed 11/3/23 Sovereign Wealth Funds / Family Offices 11 Passed 12/7/23 Passed 11/3/23 Passed 10/15/23 Passed 12/8/23 Passed 10/15/23 Passed 10/31/23 Passed 12/13/23 Passed 12/7/23 Passed 12/7/23 Passed 10/15/23 64
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW OVERVIEW OF POSSIBLE STRATEGIC ALTERNATIVES 4 Monetize Real Estate 3 Enhanced Buyback 2 Dividend Enhancement 1 Continue to Execute LTP • Execute sale leaseback transactions of the Company’s owned real estate portfolio and distribute proceeds to shareholders • Use excess cash flow to establish robust buyback program • Payout excess year - end cash as a dividend each year • Execute Baseline LTP and consistently beat Street estimates Descriptio n x Unlock value to distribute to shareholders or reinvest in core business x Streamlined operations and strategic footprint x Execution does not require new counterparty x Enhanced capital return profile x Advantageous in current valuation context relative to historical trading levels x Evolves shareholder base towards long - term oriented investors x Sends long - term confidence signal on future free cash flow generation x Immediate cash realization for shareholders x Management LTP implies outperformance vs . Street Consensus x Solid foundation for execution with clean inventory position, Canada exit and optimized supply chain Benefits X Increase in rental payments will decrease EBITDA going forward X Challenging environment for real estate sales / elevated cap rate environment X Potential for tax leakage, depending on basis X Increases risk of ratings downgrade X Indirectly increases Family / Liverpool stake X Success varies based on timing of repurchases and valuation at execution X Potentially signals lack of investment opportunities X Investors typically do not seek dividend yield from discretionary consumer sector X Taxable event for shareholders X Potentially signals lack of investment opportunities X Investors likely to expect annual dividend increases going forward X Investors may not re - rate JWN’s multiple even with outperformance X Negative investor sentiment in the sector persists X Weak trading / execution at peers has created an unfavorable backdrop for JWN X JWN may be a target for future activists given its low multiple Considerations Limited Limited Limited Moderate Value Creatio n High Low Low Moderate Execution Complexit y 65
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW OVERVIEW OF POSSIBLE STRATEGIC ALTERNATIVES 8 Full Sale to Private Equity or Strategic 7 Partnership with Liverpool and New Long - term Investor(s) 6 Increase Liverpool Stake via Tender Offer 5 Separate Rack • Sell the business to a strategic acquiror or financial sponsor • Optimize shareholder base by inviting Liverpool to partner with additional strategic investors to increase ownership • Liverpool increases its stake via a Tender Offer • Separate Full - Line (“Namesake”) and Rack into two distinct businesses with separate management teams and shareholders Descriptio n x Immediate monetization for all shareholders x Immediate monetization for public shareholders x Demonstrated inbound interest x New debt financing not likely required x Aligns shareholder base with long - term focus x Nordstrom Family could roll ownership stake x Provides current shareholders an opportunity to tender at a premium x Transitions shareholder base to more of a long - term orientation x Signal of validation from major existing shareholder and strategic investor x Potential value upside if Rack re - rates towards Off - Price peer multiples x Optimize management team and strategy around single distribution channel x Increases specialized operational expertise at each separated business Benefits X Limited universe of strategic acquirors X Limited financing available for sponsors X Likely requires refinancing existing debt X Recent trading levels and public Department Store peers may be valuation reference X Control / governance to be negotiated among buying parties X New investors will require eventual liquidity event via stake sale / re - IPO X Recent trading levels and public Department Store peers may be valuation reference X Likely to reduce trading volume / liquidity of stock X Transaction may be perceived as a step towards a take - private or entrenchment of family / management X Liverpool's willingness to pay a premium for a larger minority stake X Facilitating increase in Liverpool stake could be seen as inconsistent with rationale for poison pill adoption (i.e., ensuring shareholders receive control premium for sale of control) X Viability of Rack as standalone public entity in light of current scale and recent performance X Potential multiple contraction for Namesake towards Macy’s and Kohl’s X Ongoing dis - synergies and stranded costs from separation Considerations Material Material Limited Moderate Value Creatio n High Moderate Moderate High Execution Complexit y 66
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 67 Summary ▪ In a change of control repurchase event (“CoC”) Norse is required to offer to repurchase the notes at 101% of the principal plus accrued interest ▪ All of the following must occur to trigger a change of control repurchase event: 1 – Change of control (e.g. consummation of a transaction in which a person or group gains majority voting power) 2 – Notes are rated below investment grade by each of the rating agencies following the announcement of a change of control 3 – Rating on the notes is lowered by each of the rating agencies , as a result of the change of control Selected Excerpts “If a change of control repurchase event occurs… we will make an offer to each holder of exchange notes to repurchase all or any part… at a repurchase price in cash equal to 101% of the aggregate principal amount… plus any accrued and unpaid interest on such exchange notes…” “ ’Change of control repurchase event ’ means the occurrence of both a change of control and a below investment grade rating event.” “ ’Below investment grade rating event ’ means the rating on the exchange notes is lowered by each of the rating agencies and the exchange notes are rated below investment grade by each of the rating agencies on any date from the date of the public notice of an arrangement that could result in a change of control… … A below investment grade rating event… shall not be deemed to have occurred in respect of a particular change of control… if any of the rating agencies making the reduction in rating to which this definition would otherwise apply does not announce or publicly confirm… that the reduction was the result… of the applicable change of control ” BONDS’ CHANGE OF CONTROL PROVISION Source: Norse indentures. Note: Norse’s 2028 debentures do not have a change of control trigger. .
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 68 LEGAL DISCLAIMER – MORGAN STANLEY We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. 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PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 69 LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit
16(c)(x)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW PROJECT NORSE UPDATE SEPTEMBER 15, 2024
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 2 SITUATION UPDATE ▪ Throughout 2023, at the request of the Norse Board of Directors, management worked with Morgan Stanley and Centerview Partners to independently evaluate value creation potential across a number of different scenarios ▪ On February 11 th , 2024, the Special Committee was formed to oversee the process to explore a potential take - private transaction following interest expressed by Erik and Pete Nordstrom in submitting a proposal ▪ On June 19 th , the Special Committee of the Board of Directors shared a process letter with E&P if they were to submit a proposal – Since then, the Special Committee and its advisors have continuously facilitated diligence with E&P and a number of potential equity partners ▪ On September 4 th , the Special Committee received a non - binding written proposal for a potential acquisition of the Company from a group comprised of E&P and Liverpool, together the Bid Group – Offer to acquire the common stock of the Company for a cash purchase price of $23.00 ▪ Centerview and Morgan Stanley have engaged with the Bid Group’s advisors to further understand the proposal and underlying assumptions ▪ The Bid Group has responded with further clarifications which form the basis of the proposal which we have analyzed in the following pages
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 3 BACKGROUND ON SECTOR ▪ While Norse is pursuing a number of growth opportunities, the overall sector remains challenged ▪ Department Store multiples appear to reflect overarching concern around future prospects – Norse’s share price has decreased by 61% over the past five years, and the Company is currently trading at an NTM EBITDA multiple of 4.7x, below its 5 - year average of 5.2x (1) – Norse's performance is in - line with overall sector multiple contraction – the average peer NTM EBITDA multiple of 4.4x (2) is down from the 5 - year peer average of 4.8x (3) ▪ While there may be potential for Norse’s multiple to break out of its current and pre - transaction range, achieving a higher multiple will likely require an extended period of outperformance vs. both consensus and the category ▪ Management’s new LTP (August 2024), which has been reviewed by the Board, projects higher growth and lower capital expenditures than the prior version of the LTP (November 2023) and remains ahead of consensus, which has not changed materially ▪ In addition to the above, these slides include analysis of the following topics related to evaluating the Bid Group proposal: – How can the Board evaluate Norse’s potential stock price absent a transaction? – What is the fundamental value of the company? – How is the deal being funded, what is the potential ratings impact and how might a potentially higher offer impact this? – What are the range of potential counterproposals? Notes: 1. As of unaffected date of March 18, 2024 2. Represents average of Kohl’s current multiple of 5.1x and Macy’s unaffected multiple of 3.7x as of September 3, 2024, and December 8, 2023, respectively 3. Represents average of Kohl’s 5 - year average multiple of 5.0x and Macy’s unaffected 5 - year average multiple of 4.5x as of September 3, 2024, and December 8, 2023, respectively
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 4 3.0x 2.0x 1.0x 4.0x 5.0x 7.0x 6.8x 6.0x 5.8x 8.0x 9.0x 10.0x 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 M emo (2) : Fwd. Net Sales Growth 9% 8% 5% 2% 3% 2% 6% 5% 2% 0% 0% NTM EBIT Margin 10% 9% 6% 6% 6% 6% 2% 4% 5% 4% 4% NTM EBIT Dispersion (3) 13% 15% 14% 16% 12% 20% n.m. 54% 36% 25% 19% 4.2x Source: Note: (1) (2) (3) (4) Company filings, FactSet and Capital IQ as of September 3, 2024. EBITDA figures unburdened by amortization of developer reimbursements. Department Store Peers include Macy’s and Kohl’s. AV / NTM EBITDA multiple averaged through mid - 2020 to smooth sharp swings in broker estimates. Reflects average estimates for the fiscal year, except for NTM EBIT dispersion. Calculated as the difference of the high and low NTM EBIT estimate divided by consensus as of September 3 of each year. Reflects current Norse AV / NTM EBITDA multiple. 5.2x (4) NORSE VALUATION TETHERED TO GROWTH AND MARGIN OUTLOOK Increased dispersion reflects perceived uncertainty Shading Reflects 10 th - 90 th Percentile in Each Phase Covid disruption Norse AV / NTM EBITDA Valuation – Last 10 Years Norse Department Store Peer Average (1) Norse Dept. Store Peer Avg. Norse Deal Rumor (3/18/24)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 5 11% 11% 28% 24% 35% 15% 14% 28% 27% 22% 17% 34% 31% 43% CERTAINTY OF NEAR - TERM OUTLOOK ALSO A FACTOR IN MARKET VALUE Source: Company filings, Wall Street research and FactSet as of September 3, 2024. Note: Figures reflect fiscal years ending January the following calendar year. EBITDA figures unburdened by amortization of developer reimbursements. (1) Calculated as the difference of the high estimate and the low estimate divided by the consensus estimate. (2) Specialty Retail excludes Petco’s Adj. EPS consensus spread. (3) Department Stores peers include Kohl’s, Macy’s and Norse. (4) Growth Retail peers include Five Below, Floor and Décor, Tractor Supply and Ulta Beauty. (5) Home Improvement peers include Home Depot and Lowe’s. (6) Specialty Retail peers include Academy Sports, Best Buy, Dick’s Sporting Goods, Office Depot and Petco. (7) Apparel Retail peers include Abercrombie, American Eagle, Children’s Place, Foot Locker, Gap, Guess and Victoria’s Secret. (7) Apparel peers include Levi’s, PVH and Ralph Lauren. Excludes VF Corp. (8) Off - Price peers include Burlington, Ross and T.J. Maxx. Home Improvement (5) Specialty Retail (6) Apparel Retail (7) Apparel (8) Off - Price (9) Department Stores (3) Growth Retail (4) Greater Uncertainty Greater Certainty 12.3x 15.0x 15.9x 9.0x 5.1x 5.6x 6.8x Lower Multiple Higher Multiple 10% 8% 6% 6% 5% 5% 4% Net Sales EBIT Adj. EPS (2) Median AV / NTM EBITDA Spread of FY’25E Consensus Estimates (1) Memo:
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 6 STRATEGIC LANDSCAPE CONTINUES TO EVOLVE Strategic M&A Announced Transaction Take - Private Candidates Prior Take - Private Attempt in 2024 Prior Take - Private Attempt in 2022 Recent Bankruptcies Recent sector activity underscores a weak demand outlook and potential for further consolidation Sold to Coupang Active Sale Process Sold to Naver Online Rationalization
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 7 NORSE FINANCIAL SUMMARY – LTP COMPARISON Source: Norse management. Note: Dollars in millions. Change in 2024E figures contemplates the conversion from retail accounting to cost accounting. (1) (2) EBITDA unburdened by amortization of developer reimbursements. Reflects right - of - use asset amortization less change in lease liabilities. Improved Norse Banner projections and new Rack store openings increased Management’s LTP projections Key Drivers of Change in Plan ▪ Increased net sales driven by improved outlook for 2024 and corresponding increase in ’25 - ’28 growth, largely resulting from improvement in Rack Stores ▪ Limited near - term flow through of increased sales down to adj. EBIT due to gross margin decline from shrink ▪ Reduction in capex in key areas including supply chain, technology and stores from ~3.5% of sales to ~3% of sales, with renewed focus on highest priority projects including 3 rd party pooling, highest ROI technology investments) Δ Latest LTP (August 2024) Previous LTP (November 2023) 2028E 2027E 2026E 2025E 2024E Management Projections Extrapolation Management Projections 2028E 2027E 2026E 2025E 2024E 2027E 2028E 2024E 2025E 2026E +$497 +$339 +$209 +$145 +$324 $14,949 $15,272 $15,819 $16,433 $17,074 $16,094 $16,577 $14,625 $15,127 $15,611 Total Revenue +90bp +78bp +39bp (127bp) +220bp 1.7% 2.2% 3.6% 3.9% 3.9% 3.1% 3.0% (0.5%) 3.4% 3.2% % Growth +$500 +$347 +$220 +$157 +$340 $14,498 $14,792 $15,319 $15,910 $16,525 $15,563 $16,025 $14,158 $14,635 $15,099 Net Sales +89bp +78bp +39bp (133bp) +239bp 2.0% 2.0% 3.6% 3.9% 3.9% 3.1% 3.0% (0.4%) 3.4% 3.2% % Growth +$46 ($11) ($18) ($5) ($8) $1,521 $1,406 $1,340 $1,276 $1,178 $1,416 $1,475 $1,186 $1,281 $1,358 Adj. EBITDA (1) +0b p (27bp) (25bp) (13bp) (25bp) 9.2% 8.8% 8.7% 8.6% 8.1% 9.1% 9.2% 8.4% 8.8% 9.0% % of Net Sales +$155 +$81 +$14 +$6 ($3) $989 $876 $769 $674 $577 $795 $835 $580 $668 $755 Adj. EBIT +78bp +40bp +2b p (1bp) (12bp) 6.0% 5.5% 5.0% 4.6% 4.0% 5.1% 5.2% 4.1% 4.6% 5.0% % of Net Sales ($89) ($98) ($106) ($108) ($24) $474 $457 $440 $422 $477 $555 $564 $502 $530 $546 Memo : Capex (65bp) (70bp) (74bp) (77bp) (25bp) 2.9% 2.9% 2.9% 2.9% 3.3% 3.6% 3.5% 3.5% 3.6% 3.6% % of Net Sales
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 567 541 564 522 784 502 577 674 769 876 989 Margin FY2019A (% of Revenue): 5.1% FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A 5.8% 5.3% 3.4% 4.9% 3.7% 4.4% 3.6% 3.9% 3.9% 3.2% FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A 8.9% 8.6% 7.5% 8.5% 7.8% 8.4% 7.6% 7.9% 7.8% 7.1% +47% +19% +7% 9.4% Margin FY2019A (% of FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A FY2019A 3.9% 3.9% 2.2% 3.6% 0.9% 2.2% 1.8% 1.7% (5.4%) 5.0% Growth: (2.1%) +15% +9% +4% 1,521 1,406 1,340 1,164 1,173 1,276 1,133 1,178 1,153 1,106 1,455 14,693 14,965 15,524 15,530 14,949 15,104 15,272 15,819 15,440 16,433 17,074 (0%) +1% +2% 8 Management Long - Term Plan vs. Consensus Historical Consensus Management Long - Term Plan (August 2024) Sources: Capital IQ as of September 3, 2024; Management Long - Term Plan as of August 2024 for years FY24 - 28 Note: 1. Adds back all depreciation and amortization including amortization of developer reimbursements Revenue): Adj. EBIT ($MM) Adj. EBITDA ($MM) (1) Total Revenue ($MM) MANAGEMENT’S LONG - TERM PLAN VS. STREET PROJECTIONS Actual Performance Projections FY’24E – FY26E CAGR 1.6% 2.9% 1.3% 6.7% (1.7%) 15.4%
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW $ $ 5 5 $ $ 1 1 0 0 $ $ 1 1 5 5 $ $ 2 2 0 0 $ $ 2 2 5 5 $ $ 3 3 0 0 $ $ 4 4 0 0 $38.72 $ $ 3 3 5 5 $ $ 4 4 5 5 M M a a r r - - 2 2 3 3 M M a a r r - - 2 2 4 4 M M a a r r - - 2 2 5 5 M M a a r r - - 2 2 6 6 ILLUSTRATIVE FUTURE SHARE PRICE ANALYSIS $24 Illustrative Future Share Price Trajectory (LTP and Consensus Estimates) 9 Unaffected Price: $17.06 $19 Source: Norse management, company filings, FactSet and Capital IQ as of September 3, 2024. Note: Future share prices represent future value and do not include value of dividends. Future fully diluted share count assumed to be diluted by forecasted stock - based compensation issuance. Consensus free cash flow extrapolated based on LTP free cash flow conversion rate. Assumes cash roll - forward beginning with current Q2’24 cash of $679mm. (1) Assumes peer - based cost of equity of 16.6%. LTP at 4.5x NTM EBITDA LTP at range of 4.0x – 5.0x NTM EBITDA Consensus at 4.5x NTM EBITDA Consensus at range of 4.0x – 5.0x NTM EBITDA Historical share price Represents illustrative future value of share price on a standalone basis – – M M a a r r - - 2 2 1 1 M M a a r r - - 2 2 2 2 Present Value of Future Share Price (1) LTP Consensus $20 $18 $21 $17 $21 $18 FYE’24E FYE’25E
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 10 NORSE FAMILY / LIVERPOOL PROPOSAL SUMMARY Due Diligence Requirements Approvals and Timing ▪ Completed necessary preliminary diligence ▪ Expect to complete limited, confirmatory due diligence on expedited basis ▪ Prepared to negotiate and execute definitive documentation on expedited basis ▪ Confirmatory due diligence to be completed in parallel with negotiation of definitive documentation ▪ Execution of definitive documentation subject to final approval of Liverpool Board of Directors ▪ Conditioned on approval by Special Committee and majority of disinterested shares Financing ▪ Norse family and Liverpool expected to rollover equity interests representing $1.1bn and $0.4bn of implied value, respectively ▪ Norse family and Liverpool expected to contribute additional $0.5bn and $1.2bn, respectively, to achieve targeted 50.1% and 49.9% respective equity ownership ▪ Incremental bank financing of $325mm at company, for which the Bid Group has received preliminary proposals from two existing lenders ▪ Also expecting to use $520mm in company cash from balance sheet, leaving $100mm minimum cash at close ▪ No reference to guarantees for buyer's obligations (including damages for willful breach) ▪ Assuming agreement on price, progress with rating agency review, and cooperation with securing debt: – Not subject to any financing contingency – Bid Group will provide 100% equity commitment (but the Bid Group declined to provide additional detail regarding the amount and structure of the equity commitments) – Company will have full specific performance rights Consideration and Structure ▪ $23.00 per share cash offer price implying a purchase equity value of $3.8bn and $5.8bn in implied enterprise value (1) ▪ Offer for 100% of Norse outstanding shares of common stock ▪ Assumes $2.7bn of debt outstanding, all of which would remain post consummation of transaction ▪ Company to fund currently underfunded Supplemental Executive Retirement Plan (“SERP”) with exception of amounts required to be funded on behalf of Erik, Peter and Jamie Norse – Bid Group estimates ~$140mm total need to fund SERP Identity of Purchaser ▪ Bid Group is comprised of members of the Norse family and Liverpool ▪ Beneficially own approximately 43% of the outstanding shares of the Company’s common stock as of Q1’24 10 - Q Voting Agreements ▪ Norse family and Liverpool to provide voting agreements agreeing to vote in favor of proposed transaction ▪ Engage in good faith discussion with other potential buyers (1) Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. Termination ▪ No reverse termination fee ▪ Board may change its recommendation for a superior proposal or intervening event, but must still hold a shareholder vote on the deal ▪ If Board changes its recommendation and shareholders vote down the deal, Company would pay a termination fee ▪ If shareholders otherwise vote down deal, Company would reimburse Bid Group's expenses
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 11 174.5 Diluted Shares Outstanding (2) $4,014 Total Equity Value 2,011 (+) Net Debt (3) $6,026 Total Aggregate Value Aggregate Value / Adj. EBITDA (4) : 5.1x $1,178 Management LTP - FY'24E 4.7x $1,276 Management LTP - FY'25E 5.3x $1,133 Consensus - FY'24E 5.1x $1,173 Consensus - FY'25E Proposal Metric $23.00 NORSE FAMILY / LIVERPOOL PROPOSAL: IMPLIED PREMIA AND MULTIPLES Multiples Premia Source: Norse management, company filings, FactSet and Capital IQ as of September 3, 2024. (3) (4) Note: Dollars in millions, except per share amounts. (1) As of unaffected date of March 18, 2024. (2) Includes all outstanding options, unvested RSUs and unvested PSUs. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. Reflects current debt of $2,690 and cash of $679. Adj. EBITDA figures unburdened by amortization of developer reimbursements. +34.8% $17.06 Unaffected Price (3/18/24) +20.6% $19.08 30 - Day VWAP ed (1) +23.0% $18.70 60 - Day VWAP ffe ct +75.8% $13.08 52 - Week Low (11/13/23) Un a (1.3%) $23.30 52 - Week High (8/1/23) +0.8% $22.82 Current Price (9/3/24) Current +4.9% $21.92 30 - Day VWAP +4.7% $21.96 60 - Day VWAP +75.8% $13.08 52 - Week Low (11/13/23) (3.4%) $23.82 52 - Week High (7/17/24) Proposal Metric $23.00 Share Price Premium to:
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW PROPOSED TRANSACTION SUMMARY 12 Notes Reflecting New Proposal $MM $MM Sources # • Estimate for FY2024 year - end $620 $620 Company Cash on Balance Sheet 1 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,615 Company Existing Debt 2 • Likely funded through $1 - 1.2Bn ABL, with drawn balance paid off 1 year after transaction close to • Commitment letters to be provided at signing 325 250 New Transaction Debt 3 • Current holdings (49.6MM shares) 1,146 1,141 Family Investor Equity Roll 4 • Direct loan from Liverpool to Family Group (carried on Liverpool Balance Sheet) 467 454 Family New Equity 5 • Current holdings (15.8MM shares) 362 362 Liverpool Equity Roll 6 • Likely funded through $1.2Bn Balance Sheet cash with debt covering potential shortfall 1,244 1,226 Liverpool New Equity 7 $6,855 $6,669 Total Sources Notes Reflecting New Proposal $MM $MM Uses # • Based on Q2 2024A basic shares outstanding (164.2MM) plus dilutive equity securities at assumed transaction close of ~0.6MM in - the - money options and ~0.5MM of vested RSUs at $23.00 / share $3,800 $3,764 Company Equity Value 8 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,615 Existing Debt 9 • Unfunded balance ($168MM) to be funded into trust upon transaction close • Family Group to waive $28MM portion • Treated as transaction fees 140 140 SERP Funding 10 • Fully accounts for advisor fee estimates provided by Company advisors and financing fees required to consummate the transaction 125 50 Preliminary Transaction Fees 11 • Based on Family Group advisor estimates, with new $1 - 1.2Bn ABL facility intended to fund seasonal working capital and liquidity needs 100 100 Minimum Cash 12 $6,855 $6,669 Total Uses ▪ Proposal contemplates in - the - money options and RSUs that vest by assumed transaction close; unvested PSUs and RSUs of ~9MM to be replaced by revised compensation plan ▪ The details of the revised compensation plan have not been provided by the Bid Group and may create a new balance sheet liability Original Revised Key Revisions
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW $17.06 $17.15 $18.46 $18.51 Offer $23.00 $21.07 $16.35 $19.83 $20.14 $19.52 Adjustment H1’24 Cumulative Macy’s End of Takeover Leak Share Price Pre - Change in Analyst Share Price Perf. Present Value of 1YR Average Unaffected Share Earnings Buyout Talks Share Price Macy's Rumor Price Targets (Pre (Q1 Release - Current Analyst Multiple Price (1) Adjustment Adjustment “Bump” Q1 - Current) (3) Current) (5) Price Target Median (3)(4) ILLUSTRATIVE “ADJUSTED UNAFFECTED” PRICE METHODOLOGIES 13 4.8x (2) 4.9x (2) 4.8x (2) 4.3x (2) 4.9x (2) 4.6x (2) 4.5x (2) 4.4x (2) 4.7x Implied AV / NTM EBITDA Q1’24 and Q2’24 earnings 3 - day share price reactions (5) Macy’s 1 - day share price reaction to terminated buyout talks applied to Norse current share price Current share price less the takeover leak 3 - day share price reaction Share price prior to Macy’s takeover rumor (12/8/23) % change of median price target from pre Q1 release to post Q2 release (5) Share price performance from Q1 release (5/30/24) to current (5) Present Value of Median 1 - year Analyst Price Target (3)(4) 1 - year average unaffected multiple Unaffected share price ( 3 / 18 / 24 ) Methodology +$1.26 (Q1’24) +$1.20 (Q2’24) (11.7%) ($2.99) - - +23.5% +8.5% - - 4.4x NTM EBITDA - - Relevant Metric Illustrative “Adjusted Unaffected” Share Price ($) Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Reflects net debt as of Q2 2024A, and all outstanding options, unvested RSUs and unvested PSUs 3. “Current” Analyst Price Targets as of pre - offer 4. PV share price discounted using Morgan Stanley’s estimated cost of equity of 13.8% as of September 3, 2024 5. Applied to Norse unaffected share price or multiple Morgan Stanley Centerview Source: Capital IQ as of September 3, 2024
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Methodology Metric ($MM) Implied Share Price Agg. Value ($MM) Low High Rounded to the nearest $0.25 Public Trading Comparables (1)(2) Consensus: AV / FY2024E EBITDA: 3.5x - 5.0x Management LTP Case: AV / FY2024E EBITDA: 3.5x - 5.0x 1,133 1,178 3,965 4,122 5,664 5,889 Discounted Equity Value (1)(3) Consensus: 3.5x - 5.0x FY2026E EBITDA Management LTP Case: 3.5x - 5.0x FY2026E EBITDA 1,164 1,340 4,149 4,673 5,589 6,331 Discounted Cash Flow (1)(4) Management LTP Case: 3.5x - 5.0x Exit Multiple; 8.5% - 9.6% WACC 5,371 7,160 Reference Only: 52 - Week Trading Range Analyst Price Targets (Undiscounted) 4,280 4,280 4,018 6,200 6,374 5,851 Analyst Price Targets (Discounted) (1)(5) Leveraged Buyout (6) Management LTP Case: 17.5% - 22.5% Target IRR; Exit Multiple = Entry 5,068 5,894 $11.25 $12.00 $12.25 $15.25 $19.25 $13.00 $13.00 $11.50 $18.50 $21.00 $22.25 $20.50 $24.75 $29.50 $24.00 $25.00 $22.00 $23.50 $0 $10 $20 $30 NORSE PRELIMINARY VALUATION ANALYSIS – MORGAN STANLEY Based on Management Long - Term Plan and Consensus Estimates Sources: Capital IQ (unaffected date of March 18, 2024, current as of September 3, 2024); Management Long - Term Plan as of August 2024 for years FY24 - 28; Notes: 1. Assumes FDSO of ~174.5MM; inclusive of ~164.2MM basic shares outstanding at Q2 2024 with full accelerated vesting of dilutive equity securities inclusive of ~0.7MM options, ~1.5MM PSUs, and ~8.1MM RSUs 2. Range based on NTM trading multiples of Macy’s (3.7x) and Kohl’s (4.8x), as of unaffected date of March 18, 2024; 3. Represents present value of implied year - end 2025E share price based on discounted equity value analysis; share prices and cumulative dividends discounted at 13.8% cost of equity; sensitized on +0.75x / (0.75x) exit multiple 4. Implied share price based on DCF multiples method; WACC of 9.1%; EBITDA exit multiple of 4.25x sensitized on +0.75x / (0.75x) 5. Represents present value of median of analyst price targets as of September 3, 2024; discounted analyst price targets discounted at 13.8% cost of equity; excludes Morningstar ($38.50 price target) 6. Represents implied entry price to generate 17.5 - 22.5% IRR based on Management Long - Term Plan; assumes offer diluted share count of ~165MM (1)(5) Unaffected Share Price: $17.06 Bid Group Offer Price: $23.00 Consensus Management LTP 14
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 15 Implied AV / '24E EBITDA Methodology Assumption Implied Share Price Value Implied AV 52 - Week Trading Range 52 - Wk High: 07/17/24 52 - Wk Low: 11/13/23 $4,285 – $6,170 3.6x – 5.2x Analyst Price Target Range (1) High: 08/27/24 Low: 08/27/24 $4,271 – $6,379 3.6x – 5.4x Premia Paid Analysis Premium to Unaffected: 25% - 40% $5,730 – $6,182 4.9x – 5.2x Public Trading Comparables 4.0x - 5.0x '24E EBITDA of $1,178mm $4,711 – $5,889 4.0x – 5.0x Discounted Cash Flow Analysis WACC: 11.0% - 13.0% PGR: 1.5% - 2.5% $5,338 – $7,035 4.5x – 6.0x $13.10 $13.00 $21.30 $15.55 $19.10 $23.80 $25.00 $23.90 $22.25 $28.70 NORSE PRELIMINARY VALUATION ANALYSIS – CENTERVIEW For Reference Only Source: Norse management, Company filings and FactSet as of September 3, 2024. Note: Implied share prices rounded to the nearest $0.05. Illustrative DCF valuation date of August 3, 2024. Assumes mid - year discounting. Public Trading Comps reflect LTP financials. EBITDA is unburdened by amortization of developer reimbursements. (1) High reflects TD Cowen; Low reflects UBS. Unaffected Share Price: $17.06 Bid Group Proposal Price: $23.00
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW SUMMARY PERSPECTIVES ON FINANCING CONSIDERATIONS 16 ▪ Norse’s Senior Notes totaling $2.3Bn (all debt with exception of Debentures due 2028) contain change of control provisions for bondholders, comprising of: 1. Change of control and 2. Subsequent downgrade to the bond rating by agencies specifically in connection with the change of control transaction ▪ Therefore, the ratings assessment concurrent with the transaction announcement will be critical to the Company’s ability to roll over its current capital structure ▪ The Bid Group's current offer assumes the rollover of the existing capital structure, and the Bid Group would likely be unwilling to make a proposal if the existing indebtedness had to be refinanced in connection with the transaction ▪ The Bid Group’s current offer contemplates $325MM in additional debt drawn via new $1 - 1.2Bn ABL facility Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Refers to estimated agency - defined metrics; current reflects historical trailing twelve months at fiscal Q2 2024; projections based on Management Long - Term Plan as of August 2024 2. Pro forma assumes $23.00 offer price, transaction close on February 1, 2025, minimum cash balance of $100MM, management and Liverpool roll current ownership interests, and incremental $325MM of debt drawn via new ~$1.2Bn ABL at an assumed rate of SOFR + 200 bps 3. Debt / EBITDAR calculated as agency - defined debt divided by agency - defined EBITDAR 4. Agency debt adjustments: Moody’s includes operating leases, pensions (in current), and non - standard adjustments; S&P includes operating leases, pensions (in current), and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 5. Agency EBITDAR adjustments: Moody’s includes operating lease expense, pensions (in current), and unusual items; S&P includes operating lease expense, pensions (in current), stock - based compensation, and other; Fitch includes operating lease expense and other; excludes adjustment for impairments given Moody's worksheet exclusion of similar adjustment for latest fiscal year (related report dated April 15, 2024) Illustrative Breakpt. PF 2024E (2) Est. LTM Q2’24 (1) Leverage Ratio (1)(3)(4)(5) Illustrative Breakpt. PF 2024E (2) Est. LTM Q2’24 (1) Leverage Ratio (1)(3)(4)(5) Illustrative Breakpt. PF 2024E (2) Est. LTM Q2’24 (1) Leverage Ratio (1)(3)(4)(5) 4.0x 4.0x 3.9x Debt / EBITDAR 3.0x 3.1x 2.7x Net Debt / EBITDAR 4.0x 3.2x 3.2x Debt / EBITDAR Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) ▪ Additional quantitative and qualitative factors will be evaluated by the agencies during the ratings assessment process, including market characteristics, the Bid Group’s go - forward governance and capital allocation policies, and specific terms of the new ABL facility – The replacement of the current revolving credit facility with an ABL may cause a divergence between the bond instrument ratings and corporate credit ratings ▪ The Bid Group has committed to an approach that preserves the ability to roll over Norse’s Senior Notes, including maintaining ample liquidity and target leverage ratios ▪ The Bid Group's current offer states that there will be no contingency related to the notes assuming, among other things, progress on rating agency review
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW $26.00 $25.50 $25.00 $24.50 $24.00 $23.50 +13% +11% +9% +7% +4% +2% $23.00 Metric +52% +49% +47% +44% +41% +38% +35% $17.06 vs. Unaffected (3/18/24) +36% +34% +31% +28% +26% +23% +21% $19.08 vs. Unaffected 30D VWAP Premium / +14% +12% +10% +7% +5% +3% +1% $22.82 vs. Pre - Proposal (9/3/24) (Discount) +18% +15% +13% +11% +9% +6% +4% $22.11 vs. Current (9/11/24) 174.8 174.7 174.7 174.7 174.6 174.6 174.5 Diluted Shares Outstanding (1) $4,544 $4,456 $4,367 $4,279 $4,191 $4,103 $4,014 Equity Value 2,011 2,011 2,011 2,011 2,011 2,011 2,011 Plus: Status Quo Current Net Debt (2) $6,555 $6,467 $6,379 $6,290 $6,202 $6,114 $6,026 Aggregate Value 10.9% 11.4% 11.8% 12.3% 12.8% 13.4% 13.9% Internal Rate of Return (IRR) Illustrative Bid 1.6x 1.7x 1.7x 1.7x 1.8x 1.8x 1.8x Multiple on Invested Capital (MOIC) Group Returns (4,5) Illustrative Agency - Defined Leverage Ratios (2024E PF) (5) 3.2x 3.2x 3.2x 3.3x 3.3x 3.3x 3.4x Illustrative ratings breakpoints Moody's 3.1x 3.1x 3.2x 3.2x 3.2x 3.3x 3.3x at various prices not reflective S&P 4.0x 4.0x 4.0x 4.1x 4.1x 4.1x 4.2x of other potential qualitative factors Fitch Memo: New Transaction Debt $325 $375 $425 $476 $526 $576 $626 Illustrative Price Per Share Management LTP - 2024E $1,178 5.1x 5.2x 5.3x 5.3x 5.4x 5.5x 5.6x Consensus - 2024E $1,133 5.3x 5.4x 5.5x 5.6x 5.6x 5.7x 5.8x Bid Group Funding Incremental Capital Required vs. Proposal – +$50 +$100 +$151 +$201 +$251 +$301 AV / Adj. EBITDA (3) 17 ILLUSTRATIVE NORSE TAKE PRIVATE AT VARIOUS PRICES Source: Norse management, Moody’s, S&P, Fitch, company filings and FactSet as of September 3, 2024, except where otherwise noted. Note: Dollars in millions, except per share amounts. (1) Includes all outstanding options, unvested RSUs and unvested PSUs. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. (2) Reflects current debt of $2,690 and cash of $679. (3) Adj. EBITDA figures unburdened by amortization of developer reimbursements. (4) Assumes illustrative 4.5x AV / LTM EBITDA exit at FY’28E year - end. (5) Illustratively assumes the management LTP, transaction close on February 1, 2025, 100% of excess cash flow post - close swept to common equity as dividends after drawn ABL balance is paid down, $100mm minimum cash and illustrative total transaction fees of $125mm, any incremental purchase price is funded by new transaction debt and new transaction debt cost of SOFR+200bps.
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 18 SUPPLEMENTARY MATERIALS
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW SUPPLEMENTARY MATERIALS A Adjusted Unaffected Share Price Supporting Analysis B Morgan Stanley Supporting Valuation Analysis C Centerview Supporting Valuation Analysis D Market Perspectives on the Department Store Sector E Investor Perspectives on Norse's Valuation Multiple F Ratings Considerations G Process Summary 19
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 20 APPENDIX A ADJUSTED UNAFFECTED SHARE PRICE SUPPORTING ANALYSIS
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW POTENTIAL DRIVERS OF SHARE PRICE CHANGE Other Fundamental Factors Department Store Peer Performance ▪ Mixed earnings from Department store peers, with Macy’s outperforming Street expectations and raising guidance ▪ Meanwhile Kohl’s saw disappointing topline and earnings results and significant downward revision of guidance ▪ Capital allocation, strategic pivots, etc. Change in Norse Valuation Factors Topline / Growth EBIT Margin Macro Environment / Industry Sentiment ▪ Continuation of recent trends, including elevated levels of inflation and higher interest rates ▪ U.S. interest rates expected to remain higher for longer ▪ Improvement in growth outlook, partially driven by strength of Q1 - Q2 2024 earnings led by Rack performance ▪ Margin outlook down due to risks from Q3 - Q4 2024 profitability ramp embedded in guidance Terminal Trajectory ▪ Difficult to believe perpetuity assumptions have changed following two quarters of performance ? Potential Drivers of Share Price Change Considerations Change in Perception Since 3/18 Rumor Change in Norse Earnings ▪ Earnings outlook largely unchanged and unlikely to materially affect Norse valuation ▪ Between the unaffected date of March 18 th and current, 2024E and 2025E Adj. EPS estimates are +3.1% and +3.0% , respectively Potential Multiple Drivers 21 Source: FactSet as of September 3, 2024.
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 22 2.0x 2.5x 3.5x 3.4x 4.5x $10 $16 $18 $20 $22 $24 Aug - 23 Nov - 23 Feb - 24 May - 24 Aug - 24 $12.35 $12 2.8x $14 3.0x $15.49 +25.4% CASE STUDY – MACY’S TRADING ANALYSIS DURING BUYOUT DISCUSSIONS Macy’s Share Price & AV / NTM EBITDA Valuation Over Time Source: Company filings and FactSet as of September 3, 2024. Dec. 11, 2023: Leak of buyout bid from Arkhouse Management & Brigade Capital of $21 per share Share Price Reaction: +19.4% AV/EBITDA: 4.2x Jan. 21, 2024: Company publicly rejects bid, citing financing concerns and lack of compelling value Share Price Reaction: +3.6% Cumulative Share Price Reaction: +5.0% AV/EBITDA: 3.9x Mar. 3, 2024: Receives revised bid from Arkhouse & Brigade of $24 per share Share Price Reaction: +13.5% Cumulative Share Price Reaction: +17.6% AV/EBITDA: 3.8x July 15, 2024: Terminates discussions with Arkhouse & Brigade Share Price Reaction: (11.7%) Cumulative Share Price Reaction: (3.1%) AV/EBITDA: 3.4x Share Price AV / NTM EBITDA 4.0x Avg. Multiple: 3.7x Feb. 27, 2024: Reports Q4’23 earnings with an EPS miss Share Price Reaction: (7.7%) Cumulative Share Price Reaction: +5.9% AV/EBITDA: 3.5x
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 23 Since 2019, Norse multiple appears to reach ceiling of mid - single digits NORSE TRADING MULTIPLE VOLATILITY IN LAST 5 YEARS Norse AV / NTM EBITDA September 2019 – Present (1) Source: Company filings and FactSet as of September 3, 2024. (1) Excludes COVID - related disruption period of March 2020 through November 2021. % of Days 4.0x – 4.5x 4.5x – 5.0x ≤4.0x 5.5x – 6.0x 9% 29% 35% 23% 4% 5.0x – 5.5x Days that Norse traded at 5.0x - 5.5x during the affected period (Mar - 24 – present) represent 8% of total 8%
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW $14.4 $14.4 $14.2 $14.3 $14.3 $14.4 $14.5 $14.4 $14.4 $14.6 2024E % YoY Growth 2025E $563 $593 $542 $552 $520 $506 $503 $528 $538 $554 2025E $2.01 $2.06 $1.94 $1.87 $1.83 $1.90 $1.90 $1.89 $1.95 2024E % YoY Growth 2025E NORSE CONSENSUS ESTIMATES OVER TIME Source: Company filings and FactSet as of September 3, 2024. Note: Post Q2’23, Post Q3’23, Post Q4’23, Post Q1’24 and Post Q2’24 / Current represent consensus figures taken as of September 17, 2023, December 5, 2023, March 17, 2024, June 12, 2024 and September 3, 2024, respectively. Revenue ($bn) Adj. EBIT ($mm) EPS 2024E % Margin Post Q2’23 Post Q3’23 Post Q1’24 % Change in Estimates (1.3%) +0.4% +0.8% (0.7%) +0.6% +0.9% (3.8%) (6.6%) (0.7%) (7.1%) (5.8%) +1.5% (3.5%) (5.3%) $1.79 (2.3%) (9.2%) +1.5% Top - line growth expectations have accelerated over past year, while profitability dollars and margin have deteriorated Post Q4’23 / Pre - Takeover Leak Post Q2’24 / Current (0.1%) +0.3% +7.0% +5.1% +2.5% (0.9%) 4.1% 3.9% +0.2% +0.5% (3.5%) (4.9%) 3.8% 3.8% +0.9% +0.0% +3.5% (13.5%) 3.6% 3.5% +1.0% +0.3% +6.2% (15.5%) 3.6% 3.5% +1.1% +1.1% +3.4% (10.8%) 3.8% 3.7% +1.5% +1.0% +0.8pp (9.9pp) Δ (0.3pp) (0.2pp) Δ +1.3pp +0.6pp Δ 24 +5.5% +0.3% +2.7%
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW APPENDIX B MORGAN STANLEY SUPPORTING VALUATION ANALYSIS 25
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 5.1x 4.7x 4.6x 4.1x 5.0x 3.9x 5.3x 5.1x 4.7x 4.4x 5.0x 3.9x 3.6% 3.9% 3.5% 4.0% 3.8% 4.7% 1.4% 1.9% 0.8% 1.5% (2.8%) 0.6% 0.9% 5.2% (1.2%) 5.4% (4.2%) (4.3%) 7.6% 7.9% 7.5% 8.1% 8.6% 8.6% 12.0x 12.7x 9.4x 8.8x 10.7x 6.3x 11.5x 9.4x 8.6x 7.5x 10.5x 6.3x NORSE’S MANAGEMENT LONG - TERM PLAN IS AHEAD OF CONSENSUS REVENUE AND PROFITABILITY EXPECTATIONS 26 Sources: Capital IQ as of September 3, 2024; Management Long - Term Plan as of August 2024 Notes: 1. Norse figures add back all depreciation and amortization including amortization of developer reimbursements 2. Norse FDSO and net debt as of Q2 2024A; inclusive of $2,690MM in debt and $679MM in cash and equivalents 3. Represents Norse as of unaffected date of March 18, 2024 4. Represents Macy’s as of unaffected date of December 8, 2023 CY2025E P / E (x) CY2024E P / E (x) CY2025E AV / EBITDA (x) (1)(2) CY2024E AV / EBITDA (x) (1)(2) CY2024E EBIT Margin (%) CY2024E EBITDA Margin (%) (1) CY’23A – CY’25E EBITDA CAGR (%) (1) CY’23A – CY’25E Revenue CAGR (%) Norse Current Consensus (4) Norse Current Management LTP Norse Unaffected Consensus (3) Norse Unaffected Management LTP (3) Morgan Stanley
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Date Disclosed Valuation Details Price Target Rating Firm Name 8/27/2024 Discounted Cash Flow $38.50 Buy Morningstar 8/27/2024 ~12.5x FY2025 EPS $25.00 Hold TD Cowen 8/27/2024 9.3x 2025E P/E and 5.7x 2025E AV / EBITDA $24.00 Buy KeyBanc 8/28/2024 11.7x 2026E EPS $24.00 Hold Telsey 8/27/2024 ~12.0x FY2025 EPS $23.00 Hold Gordon Haskett 8/28/2024 ~5.0x FY2024 AV / EBITDA $22.00 Hold Citi 8/27/2024 ~10x FY2025 EPS $22.00 Hold BMO 8/27/2024 10.0x 2025E EPS $19.00 Hold Evercore 8/28/2024 4.3x 2026E AV / EBITDA $20.00 Sell JP Morgan 8/27/2024 9.0x NTM P/E Multiple based on CY2026 EPS $18.00 Sell Barclays 8/27/2024 4.75x Q5 - Q8 AV / EBITDA Estimates $21.00 Hold Goldman Sachs 8/28/2024 5.0x FY2025 AV / EBITDA $20.00 Sell Bank of America 8/28/2024 10.0x FY2025 P/E $20.00 Hold Jefferies 8/27/2024 ~0.3x FY2026E AV / Sales $13.00 Sell UBS 8/28/2024 NA NA Hold Guggenheim 8/28/2024 NA NA Hold William Blair 8/28/2024 NA NA NA Morgan Stanley Present Value: $18.46 (2) $21.00 Median (1) Present Value: $18.32 (2) $20.85 Mean (1) As of Latest Quarterly Earnings Released on August 27, 2024 CURRENT SHARE PRICE REPRESENTS A PREMIUM TO PRESENT VALUE OF MEDIAN PRICE TARGETS Sources: Wall Street Equity Research, Market Data as of September 3, 2024 Notes: 1. Morningstar Price Target excluded from median and mean calculations 2. Analyst Price Targets reflective of pre - offer levels; PV share price discounted using Morgan Stanley’s estimated cost of equity of 13.8% as September 3, 2024 Morgan Stanley 27
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW AV / NTM Adj. EBITDA of 5.00x $12.37 $14.80 $17.41 $19.80 $17.06 $22.45 $24.80 Current 2024E 2025E $11.60 $12.26 $17.06 $16.32 $16.38 $21.05 $20.50 Current 2024E 2025E Future Share Price (Incl. Dividends) (1) $MM / Share Present Value of Future Share Price (Incl. Dividends) (1)(2) $MM / Share Consensus Estimates In - Line With Unaffected Share Price of ~$17 ILLUSTRATIVE DISCOUNTED EQUITY VALUE | CONSENSUS Notes: 1. Calculated as NTM EBITDA multiplied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by JWN FDSO of ~174.5MM; inclusive of future value of cumulative dividends per share discounted to present value 2. Discounted to July 30, 2024 at 13.8% cost of equity 3. Market data as of unaffected date of March 18, 2024; Current share price as of September 3, 2024 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 1,164 5.0x 1,173 4.3x 1,164 4.3x 1,173 3.5x 1,164 3.5x 1,173 AV / NTM Adj. EBITDA Multiple (x) NTM Adj. EBITDA 5,818 5,865 4,945 4,985 4,072 4,106 Future Aggregate Value (1,586) (2,044) (1,586) (2,044) (1,586) (2,044) ( - ) Net Debt 4,231 3,821 3,359 2,942 2,486 2,062 Future Equity Value 175 175 175 175 175 175 FDSO (1) $24.24 $21.90 $19.24 $16.85 $14.24 $11.81 Future Share Price ($USD) $24.80 $22.45 $19.80 $17.41 $14.80 $12.37 Future Share Price Incl. Dividends 1.50 0.50 1.50 0.50 1.50 0.50 Periods 0.82 0.94 0.82 0.94 0.82 0.94 Discount Factor (2) $19.97 $20.53 $15.86 $15.80 $11.74 $11.08 Discounted Share Price ($USD) $20.50 $21.05 $16.38 $16.32 $12.26 $11.60 Discounted Share Price Incl. Dividends 7.7% 10.6% (13.9%) (14.2%) (35.6%) (39.1%) Premium / (Discount) to Unaffected 30D VWAP ($19.03) 20.2% 23.4% (4.0%) (4.3%) (28.1%) (32.0%) Premium / (Discount) to Unaffected ($17.06) (3) (10.2%) (7.8%) (28.2%) (28.5%) (46.3%) (49.2%) Premium / (Discount) to Current ($22.82) (3) Denotes range on FBF 3.50x NTM Adj. EBITDA 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x 5.00x NTM Adj. EBITDA Morgan Stanley 28
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 1,340 5.0x 1,276 4.3x 1,340 4.3x 1,276 3.5x 1,340 3.5x 1,276 AV / NTM Adj. EBITDA Multiple (x) NTM Adj. EBITDA 6,701 6,381 5,695 5,424 4,690 4,467 Future Aggregate Value (1,567) (2,041) (1,567) (2,041) (1,567) (2,041) ( - ) Net Debt 5,134 4,340 4,129 3,383 3,124 2,426 Future Equity Value 175 175 175 175 175 175 FDSO (1) $29.42 $24.87 $23.66 $19.38 $17.90 $13.90 Future Share Price ($USD) $29.97 $25.43 $24.22 $19.94 $18.46 $14.46 Future Share Price Incl. Dividends 1.50 0.50 1.50 0.50 1.50 0.50 Periods 0.82 0.94 0.82 0.94 0.82 0.94 Discount Factor (2) $24.24 $23.31 $19.49 $18.17 $14.75 $13.03 Discounted Share Price ($USD) $24.76 $23.84 $20.01 $18.69 $15.27 $13.55 Discounted Share Price Incl. Dividends 30.1% 25.3% 5.2% (1.8%) (19.8%) (28.8%) Premium / (Discount) to Unaffected 30D VWAP ($19.03) 45.1% 39.7% 17.3% 9.6% (10.5%) (20.6%) Premium / (Discount) to Unaffected ($17.06) (3) AV / NTM Adj. EBITDA of 5.00x $14.46 $18.46 $19.94 $24.22 $17.06 $25.43 $29.97 Current 2024E 2025E $13.55 $15.27 $17.06 $18.69 $20.01 $23.84 $24.76 Current 2024E 2025E Future Share Price (Incl. Dividends) (1) $MM / Share Present Value of Future Share Price (Incl. Dividends) (1) (2) $MM / Share Achieving the LTP Implies a $3 - 4 Premium to Unaffected Price ILLUSTRATIVE DISCOUNTED EQUITY VALUE | MANAGEMENT LONG - TERM PLAN 3.50x NTM Adj. EBITDA 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x 5.00x NTM Adj. EBITDA Morgan Stanley Premium / (Discount) to Current ($22.82) (3) (40.6%) (33.1%) (18.1%) (12.3%) 4.5% 8.5% Denotes range on FBF Notes: 1. Calculated as NTM EBITDA multiplied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by JWN FDSO of ~174.5MM; inclusive of future value of cumulative dividends per share discounted to present value 2. Discounted to July 30, 2024 at 13.8% cost of equity 3. Market data as of unaffected date of March 18, 2024; Current share price as of September 3, 2024 29
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 3.9% 3.9% 3.6% 2.2% % Growth 1,521 1,406 1,340 1,276 681 Adjusted EBITDA 8.9% 8.6% 8.5% 8.4% 8.8% % Margin (497) (493) (531) (552) (265) ( - ) D&A (35) (37) (40) (50) (29) ( - ) Amort. Of Developer Reimbursements 989 876 769 674 387 EBIT 6% 5% 5% 4% 5% % Margin (267) (236) (208) (182) (98) ( - ) Tax Expense 27% 27% 27% 27% 26% % Effective Tax Rate 497 493 531 552 265 (+) D&A 35 37 40 50 29 (+) Amort. Of Developer Reimbursements 202 196 191 187 93 (+) Right of Use Asset Amort. (288) (279) (272) (267) (134) (+) (Increase) / Decrease in Lease Liabilities (28) (49) (51) (104) (226) (+) (Increase) / Decrease in NWC (474) (457) (440) (422) (273) ( - ) CapEx 665 580 560 488 43 Unlevered Free Cash Flow 44% 41% 42% 38% 6% % Free Cash Flow Conversion (2) Implied Share Price 5.00x 4.25x 3.50x Terminal EBITDA Exit Multiple 9.6% 9.1% 8.5% 9.6% 9.1% 8.5% 9.6% 9.1% 8.5% Discount Rate Present Value of: 1,847 1,870 1,893 1,847 1,870 1,893 1,847 1,870 1,893 Forecasted Free Cash Flow 5,036 5,146 5,259 4,280 4,374 4,470 3,525 3,602 3,681 Terminal Value 6,883 7,016 7,152 6,127 6,244 6,363 5,372 5,472 5,574 Implied Aggregate Value (2,011) (2,011) (2,011) (2,011) (2,011) (2,011) (2,011) (2,011) (2,011) ( - ) Net Debt (3) 4,872 5,005 5,141 4,116 4,233 4,352 3,361 3,461 3,563 Implied Equity Value 175 175 175 175 175 175 175 175 175 Fully Diluted Shares (4) $27.91 $28.68 $29.46 $23.59 $24.25 $24.94 $19.26 $19.83 $20.42 Implied Price Per Share ($USD) 0% (0%) (1%) (1%) (2%) (2%) (3%) (4%) (4%) Implied Perpetuity Growth Rate 22% 26% 29% 3% 6% 9% (16%) (13%) (11%) % Premium / (Discount) to Unaffected (5) 64% 68% 73% 38% 42% 46% 13% 16% 20% % Premium / (Discount) to Current (6) 5.8x 6.0x 6.1x 5.2x 5.3x 5.4x 4.6x 4.6x 4.7x Implied AV / 2024E EBITDA 5.4x 5.5x 5.6x 4.8x 4.9x 5.0x 4.2x 4.3x 4.4x Implied AV / 2025E EBITDA Key Assumptions • July 30, 2024 valuation date January ending fiscal year • 4.5 - year DCF using mid - year discounting convention • WACC range of ~8.5% - 9.6% • Illustrative effective tax rate in years FY24E - FY28E of 27% • Terminal year assumptions (1) : – D&A equal to terminal year CapEx – Increase in NWC calculated from a 2% revenue growth into perpetuity 2028E 2027E 2026E 2025E 2H 2024E FYE February 3 17,074 16,433 15,819 15,272 7,720 Revenue • Financials presented on Unlevered Free Cash Flow Forecast (1) $MM, unless otherwise noted ILLUSTRATIVE DISCOUNTED CASH FLOW ANALYSIS | MANAGEMENT LONG - TERM PLAN Notes: 1. Terminal LTM EBITDA assumes 3.9% terminal revenue growth; 8.9% terminal EBITDA margin 2. Free Cash Flow Conversion represents Unlevered Free Cash Flow divided by Adjusted EBITDA 3. Net debt as of Q2 2024A; inclusive of $2,690MM of debt and $679MM of cash 4. Fully diluted shares of ~174.5MM; inclusive of ~164.2MM basic shares outstanding at Q2 2024 with full accelerated vesting of outstanding dilutive equity securities inclusive of ~0.7MM options, ~1.5MM PSUs, and ~8.1MM RSUs 5. Unaffected date as of March 18, 2024 6. Current market data as of September 3, 2024 Denotes range on FBF 30 Morgan Stanley
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Total (%) Amount ($) Multiple (x) Uses 55% $3,800 3.2x Purchase Equity 39% 2,690 2.3x Debt Roll 1% 100 0.1x Minimum Cash 2% 125 0.1x Transaction Fees 2% 140 0.1x SERP 100% $6,855 5.8x Total Uses Target Exit Multiple IRR 3.5x 3.9x 4.3x 4.6x 5.0x 17.5% $19.56 $20.56 $21.56 $22.56 $23.55 18.8% $19.24 $20.19 $21.14 $22.10 $23.05 20.0% $18.94 $19.85 $20.75 $21.66 $22.57 21.3% $18.65 $19.52 $20.38 $21.25 $22.12 22.5% $18.38 $19.21 $20.03 $20.86 $21.69 Total (%) Amount ($) Multiple (x) Sources 39% $2,690 2.3x Existing Debt 5% $325 0.3x New Transaction Debt 9% $620 0.5x Balance Sheet Cash 17% $1,146 1.0x Management Rollover 5% $362 0.3x Liverpool Rollover 25% $1,711 1.5x New Sponsor Equity (4) 100% $6,855 5.8x Total Sources Exit Multiple / Target IRR Implied $ per Share Key Assumptions • Offer price ($23.00 / share) (1) • Incremental $325MM in transaction debt funded through ABL (revolver upsized to $1.2Bn ABL facility at transaction close) (2) • Assumes incremental $325MM in transaction debt paid off 1 year after transaction close (12/31/25) • Min cash of $100MM • Assumes all excess cash flows paid out to Bid Group as dividends • Assumes Family and Liverpool roll current equity stakes • Effective tax rate of 27% • 4.5 - year hold, with illustrative closing date of Q2 2024 • Entry Multiple based on NTM EBITDA of $1.2Bn (3) • NTM Exit EBITDA of $1.6Bn Illustrative Sources and Uses $MM, unless otherwise noted 31 ILLUSTRATIVE LEVERAGED BUYOUT ANALYSIS | MANAGEMENT LONG - TERM PLAN Sources: Capital IQ; Management Long - Term Plan as of August 2024 for years FY24 - 28 Notes: 1. Reflects Bid Group offer at September 3, 2024 with assumed share count of ~165MM 2. Incremental $325MM draw from ABL at an assumed rate of SOFR + 200 bps 3. Net debt as of Q2 2024A; inclusive of $2,690MM of debt and $679MM of cash 4. Includes total new equity contributions from Family and Liverpool Denotes range on FBF Entry = Exit for 17.5 - 22.5% IRR A 20% Internal Rate of Return Implies an $21 Entry Price (~4.5x Entry Multiple) Morgan Stanley
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW High Low Base Notes Assumption 3.8% 3.8% 3.8% Spot Rate on 10 - Year U.S. Treasury as of 09/03/2024 Risk Free Rate (R f ) 6.0% 6.0% 6.0% Morgan Stanley Estimated Market Risk Premium Market Risk Premium (MRP) 1.66 1.66 1.66 Predicted U.S. Local Beta per Barra Predicted Beta 1.0% (1.0%) +/ - 1.0% from Base Sensitivity Adjustment 14.8% 12.8% 13.8% Calculated Using the Capital Asset Pricing Model Cost of Equity (K E ) 5.2% 5.2% 5.2% Weighted Average Cost of Debt Pre - tax Cost of Debt (K D ) 27.0% 27.0% 27.0% Per Management Guidance Tax Rate (t) 3.8% 3.8% 3.8% Post - tax Cost of Debt (K D ) 47.5% 47.5% 47.5% Based on Current Capital Structure Debt / Total Capitalization 9.6% 8.5% 9.1% KE * E/(D+E) + KD * (1 - t) * D/(D+E) Weighted Average Cost of Capital (WACC) WACC Calculation Key Assumptions • Cost of Equity: Calculated using the Capital Asset Pricing Model • Risk Free Rate: Based on 10 - year U.S. Treasury as of current market date of September 3, 2024 • Predicted Beta: Predicted U.S. Local Beta per Barra as of unaffected date of March 18, 2024 • Cost of Debt: Norse’s current blended cost of debt • Tax Rate: Implied long - term tax rate of 27% as provided in Management’s LTP • Capital Structure: Norse’s current debt / total capitalization ratio (1) ILLUSTRATIVE WEIGHTED AVERAGE COST OF CAPITAL ANALYSIS Sources: Company filings, Capital IQ as of unaffected date of March 18, 2024 and current market date of September 3, 2024 for Risk Free Rate Note: 1. Debt as of Q2 2024A and market value of Norse equity as of unaffected date of March 18, 2024 Morgan Stanley 32
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 33 APPENDIX C CENTERVIEW SUPPORTING VALUATION ANALYSIS
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 34 Centerview DISCOUNTED CASH FLOW ANALYSIS Assumes LTP Source: Norse management and Wall Street research. Note: Dollars in millions, except per share amounts and where otherwise noted. Share prices rounded to nearest $0.10. Assumes valuation date and balance sheet information as of August 3, 2024. Represents fiscals years ending January. (1) (2) (3) 2024E - 2028E reflects the five - year LTP reviewed with the Board in August 2024. Represents normalized depreciation & net working capital. Change in net working capital reflects midpoint of perpetuity growth rate range. EBITDA unburdened by amortization of developer reimbursements. Unlevered Free Cash Flow Detail Perpetuity Growth Rate Method Implied Share Price Implied Terminal LTM EBITDA Multiple Perpetuity Growth Rate 1.5% 2.0% 2.5% $25.60 $27.10 $28.70 $22.00 $23.20 $24.40 Perpetuity Growth Rate 1.5% 2.0% 2.5% 4.9x 5.2x 5.5x 4.5x 4.7x 4.9x WACC 11.00% 12.00% 13.00% $19.10 $20.00 $21.00 4.1x 4.3x 4.5x Projection Period (1) Terminal (2) 2028E 2027E 2026E 2025E H2'24 2023A $16,525 $16,525 $15,910 $15,319 $14,792 $7,492 $14,219 Net Sales $1,521 $1,521 $1,406 $1,340 $1,276 $681 $1,153 EBITDA (3) (474) (532) (530) (571) (602) (294) (586) ( - ) Total D&A (283) (267) (236) (208) (182) (98) (13) ( - ) Taxes $764 $722 $639 $561 $492 $289 $554 NOPAT 474 497 493 531 552 265 517 (+) D&A, Net – 35 37 40 50 29 69 (+) Developer Reimbursement Amort. (86) (86) (83) (81) (80) (41) (88) ( - ) Cash Lease Expense Adj. (16) (28) (49) (51) (104) (226) (169) ( - ) Δ in NWC (474) (474) (457) (440) (422) (273) (569) ( - ) Capex $663 $665 $580 $560 $488 $43 $314 Unlevered FCF
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 35 ILLUSTRATIVE WACC ANALYSIS Source: Company filings, Kroll, Bloomberg and FactSet as of September 3, 2024. Note: U.S. dollars in millions. (1) Represents two - year weekly adjusted beta (based on local index) per Bloomberg. (2) Calculated as (Levered Beta / (1 + ((1 - Tax Rate) * Debt / Equity)). (3) Figure excludes finance leases. (4) Reflects current U.S. 20 - year treasury note yield. (5) Reflects median of unlevered betas of comparable group. (6) Reflects median peer debt / equity. (7) Reflects levering of the median unlevered beta of the peers at target debt / equity ratio. Levered Beta = (Unlevered Beta) * (1 + (1 - Tax Rate) * (Debt / Equity)). (8) Reflects U.S. Long - Horizon Equity Risk Premium per Kroll. (9) Reflects size premium per Kroll Valuation Handbook. (10) Calculated as Risk - Free Rate + (Historical Risk Premium * Levered Beta) + Size Premium. (11) Assumes illustrative cost of debt based on trading yields on bonds for Norse prior to takeover rumors and selected peers. (12) Reflects Norse management long - term tax rate. (13) WACC equals ((Debt/Capitalization) * After - Tax Cost of Debt) + (Equity/Capitalization * Levered Cost of Equity)). 83% 1,945 (3) 2,357 1.08 1.78 Kohl's 73% $2,485 $3,394 1.04 1.67 Peer Median 68% $2,690 $3,983 1.26 1.88 Norse WACC Analysis Beta Levered (1) Unlevered (2) 1.55 1.01 Market Cap. Debt / Equity Company Debt Macy's 4,430 3,024 68% Peer - Based WACC Risk - Free Rate (4) 4.16% Unlevered Beta (5) 1.04 Debt / Equity (6) 73% Levered Beta (7) 1.60 Historical Risk Premium (8) 7.17% Size Premium (9) 0.95% Cost of Equity (10) 16.6% Pre - Tax Cost of Debt (11) 7.25% Tax Rate (12) 27.0% After - Tax Cost of Debt 5.3% Centerview 11.8% WACC (13) 1.25 1.20 1.15 1.10 1.05 1.00 Equity Cap. 50% 33% 42.3% D / (D+E) 75% 43% 57.7% E / (D+E) 100% 50% 125% 56% 13.3% 13.0% 12.7% 12.3% 12.0% 11.7% 13.1% 12.8% 12.5% 12.2% 11.8% 11.5% 13.0% 12.6% 12.3% 12.0% 11.7% 11.4% 12.8% 12.5% 12.2% 11.9% 11.6% 11.3% WACC Sensitivity Analysis (Peer - Based) (13) Debt / Debt / Unlevered Beta
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 36 NORSE COMPARABLE COMPANIES ANALYSIS Source: Norse management, company filings, FactSet and Capital IQ as of September 3, 2024. Note: Dollars in millions except per share figures. (1) Norse LTP EBITDA figures add back amortization of developer reimbursement for comparison to consensus EBITDA. (2) EBIT and EBITDA reflect adjusted figures. (3) Debt figures do not include leases and LTM EBITDA does not add back rent. (4) CAGR reflects total revenue given available broker estimates. (5) Norse figures as of unaffected date of March 18, 2024. Selected Department Store Peers Centerview Leverage (3) Leverage (3) 2024E 2023A EBIT (2) EBITDA (1,2) Net Sales 2025E 2024E 2023A Value Cap Wk. High Price Company 1.3x 1.5x 5.0% 6.1% (13.0%) (7.2%) (2.0%) 3.4x 3.4x 2.9x $6,770 $4,430 (28.1%) $15.49 Macy's 3.1x 3.3x 3.8% 4.3% (8.8%) (4.2%) (2.8%) 5.0x 5.0x 4.6x 6,726 2,357 (30.9%) 20.30 Kohl's 2.2x 2.4x 4.4% 5.2% (10.9%) (5.7%) (2.4%) 4.2x 4.2x 3.8x Peer Median (0.6x) 0.5x 10.3% 13.5% (18.0%) (19.6%) (4) (2.0%) 7.1x 5.9x 4.6x 5,037 5,586 (27.4%) Memo: Dillard's $345.29 1.7x 2.3x 3.6% 4.0% (0.3%) 0.9% 3.1% 5.1x 5.3x 5.2x 5,994 3,983 (4.2%) Current Norse (Cons.) $22.82 1.7x 2.3x 4.0% 4.0% 9.1% 5.2% 2.0% 4.7x 5.1x 5.2x 5,994 3,983 (4.2%) Norse (Mgmt.) $22.82 Unaffected (5) 1.7x 2.3x 3.5% 4.0% (2.5%) (1.2%) 2.5% 4.6x 4.7x 4.5x 5,200 2,891 (26.8%) $17.06 Norse (Cons.) 1.7x 2.3x 4.0% 4.0% 9.1% 5.2% 2.0% 4.1x 4.4x 4.5x 5,200 2,891 (26.8%) $17.06 Norse (Mgmt.) Share % of 52 - Market Aggregate AV / Adj. EBITDA (1) '23A - '25E CAGR EBIT Margin Gross Net
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 37 PRECEDENT INDUSTRY TRANSACTIONS Selected U.S. Department Store Transactions Source: Company filings, FactSet and Wall Street research. Note: Dollars in billions. (1) Based on Wall Street broker estimates for CY 2024. Centerview AV / LTM EBITDA AV / LTM Revenue Aggregate Value Acquiror Announcement Date Target 6.3x 0.68x $2.8 Sycamore Partners Aug - 15 Belk 9.1x 1.31x 6.1 CPPIB & Ares Sep - 13 Neiman Marcus 10.9x 0.91x 2.9 HBC Jul - 13 Saks 9.1x 0.91x 2.9 Median 8.8x 0.97x 3.9 Average Memo - Unconsumated Transactions Jul - 24 Neiman Marcus HBC Jun - 24 Macy's Arkhouse & Brigade $2.7 ~0.6x ~8.6x 9.2 0.39x 4.1x Macy’s Board unanimously determined that the proposal remains non - actionable and fails to provide compelling value to Macy’s shareholders Transaction remains contingent on additional financing (1) (1) (Proposal Date)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Disclosed Valuation Details Date Price Target Rating Firm Name Discounted Cash Flow 8/27/2024 $38.50 Buy Morningstar ~12.5x FY2025 EPS 8/27/2024 $25.00 Hold TD Cowen 9.3x 2025E P/E and 5.7x 2025E AV / EBITDA 8/27/2024 $24.00 Buy KeyBanc 11.7x 2026E EPS 8/28/2024 $24.00 Hold Telsey ~12.0x FY2025 EPS 8/27/2024 $23.00 Hold Gordon Haskett ~5.0x FY2024 AV / EBITDA 8/28/2024 $22.00 Hold Citi ~10x FY2025 EPS 8/27/2024 $22.00 Hold BMO 10.0x 2025E EPS 8/27/2024 $19.00 Hold Evercore 4.3x 2026E AV / EBITDA 8/28/2024 $20.00 Sell JP Morgan 9.0x NTM P/E Multiple based on CY2026 EPS 8/27/2024 $18.00 Sell Barclays 4.75x Q5 - Q8 AV / EBITDA Estimates 8/27/2024 $21.00 Hold Goldman Sachs 5.0x FY2025 AV / EBITDA 8/28/2024 $20.00 Sell Bank of America 10.0x FY2025 P/E 8/28/2024 $20.00 Hold Jefferies ~0.3x FY2026E AV / Sales 8/27/2024 $13.00 Sell UBS NA 8/28/2024 NA Hold Guggenheim NA 8/28/2024 NA Hold William Blair NA 8/28/2024 NA NA Morgan Stanley $21.00 Median (1) $20.85 Mean (1) Present Value: $18.32 (2) Present Value: $18.46 (2) CURRENT SHARE PRICE REPRESENTS A PREMIUM TO PRESENT VALUE OF MEDIAN PRICE TARGETS As of Latest Quarterly Earnings Released on August 27, 2024 38 Analyst price targets above unaffected Norse share price of $17.06 and below current share price of $22.82 Source: Wall Street Equity Research, Market Data as of September 3, 2024. (1) Morningstar Price Target excluded from median and mean calculations.
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 39 APPENDIX D MARKET PERSPECTIVES ON THE DEPARTMENT STORE SECTOR
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 40 INVESTOR PERSPECTIVES ON THE DEPARTMENT STORE SPACE Bearish investor sentiment regarding the Department Store space continues to weigh on Norse • Declining market share due to greater competition • Department Store margins in secular decline • Channel shift to lower margin E - Commerce sales • Weak future earnings growth prospects • Brands shifting to DTC reduces reliance on Department Store channel • Higher reliance on adjacent sources of revenue / income (e.g., Credit Card Fee Share) rather than core category sales • Recent activity underscores broader strategic action in the space – Macy’s attempted take - private – Consolidation between Neiman Marcus Group and Saks Fifth Avenue
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 41 $25 / 8% $53 / 16% $98 / 26% $164 / 39% $15 / 5% $22 / 6% $30 / 8% $36 / 9% $205 / 69% $218 / 64% $207 / 56% $192 / 46% $53 / 18% $49 / 14% $36 / 10% $27 / 6% $298 $342 $370 $420 2008 2015 2019 2023 Other Retail Department Store Off - Price E - Commerce % of Total DEPT STORES HAVE LOST $26BN OF VALUE OVER THE LAST 15 YEARS Source: Euromonitor. Note: Dollars in billions. Other Retail includes Grocery Retailers, Variety Stores, Apparel & Footwear Specialty, Sports Goods Specialty, Other Non - Grocery Retailers and Direct Selling. +16% (1%) (2%) E - Commerce not only taking all retail growth, but now cannibalizing traditional retail as COVID gains prove sticky Retail cannibalized by E - Commerce, but pockets of growth still exist +11% (7%) (1%) CAGRs +2% +3% +2% +1% Overall ’18 - ’23 $ Change +$139bn ($13bn) ($26bn) +$22bn U.S. Apparel & Footwear Retail Sales Over Time ($bn)
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 42 3.4x 5.2x 3.2x 15.8x 13.8x 7.6x 5.9x 5.2x 7.8x 9.7x 17.7x 16.3x 21.9x 9.3x 5.0x 5.6x 6.8x 15.9x 15.0x 12.3x 9.0x 13.8x 20.3x 21.8x 26.6x 15.3x 11.6x 10.4x NTM P/E +3% +5% +1% +5% +1% +1% (2%) ’23 - ’25E Net Sales CAGR (8) 11% 9% 13% 11% 4% 7% 4% NTM EBIT Margin DIVERGENT INVESTOR ENTHUSIASM ACROSS RETAIL, DRIVEN BY FUNDAMENTALS Source: Company filings, FactSet and Capital IQ as of September 3, 2024. Note: EBITDA figures unburdened by amortization of developer reimbursements. (1) Department Stores peers include Kohl’s, Macy’s and Norse. (2) Apparel Retail peers include Abercrombie, American Eagle, Children’s Place, Foot Locker, Gap, Guess and Victoria’s Secret. (3) Specialty Retail peers include Academy Sports, Best Buy, Dick’s Sporting Goods, Office Depot and Petco. (4) Off - Price peers include Burlington, Ross and T.J. Maxx. (5) Home Improvement peers include Home Depot and Lowe’s. (6) Growth Retail peers include Five Below, Floor and Décor, Tractor Supply and Ulta Beauty. (7) Apparel peers include Levi’s, PVH and Ralph Lauren. Excludes VF Corp. (8) Reflects fiscal years ending January the following calendar year. Department Stores (1) Off - Price (4) Apparel Retail (2) Home Improvement (5) Growth Retail (6) Specialty Retail (3) Apparel (7) Category Medians: Minimum Median Maximum Forward Valuation Multiples: AV / NTM EBITDA Retail Other Relevant
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 43 FY'23 FY'22 FY'21 FY'19 FY'18 FY'17 FY'16 FY'15 FY'14 R² = 0.97 4x 5x 6x 7x 8x 9x 0% +2% +4% +6% +8% Forward Sales Growth (2) +10% Macy's Kohl's Burlington TJX Ross R² = 0.61 2x 4x 6x 8x 10x 12x 14x 16x 18x 20x (5%) (2%) +1% +4% +7% +10% +13% ’23A - ’25E Sales CAGR (1) Potential Drivers GROWTH AND MARGIN ARE KEY DRIVERS OF INDUSTRY MULTIPLES Source: Company filings and FactSet as of September 3, 2024. (1) (2) (3) Reflects Net Sales CAGR for Norse, Macy’s and Kohl’s. Represents Revenue CAGR for all other peers. Reflects 2 - year forward net sales growth. Defined as the difference of the high and low 2025 estimate divided by consensus. Average AV / NTM EBITDA per Fiscal Year AV / NTM EBITDA Dept. Store and Retail Peers Today Norse Over Time More Correlated Less Correlated R 2 EPS Estimate Dispersion (3) 0.46 EBIT Estimate Dispersion (3) 0.49 EBIT Margin (NTM) 0.56 EPS Growth (NTM) 0.14 Net Sales Estimate Dispersion (3) 0.35 FY’20 (excl. from regression) Sales Beat % - - Last 30 Quarters 0.04 ’22 - ’24E EBIT Margin Expansion 0.04 Apparel Retail Home Improvement Growth Retail Apparel Specialty Retail Norse Multiple vs. Sales Growth Other Regressions on Multiple
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 44 APPENDIX E INVESTOR PERSPECTIVES ON NORSE'S VALUATION MULTIPLE
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 45 INVESTOR PERSPECTIVES ON NORSE’S VALUATION MULTIPLE • Most investors view the Department Store category as being in secular decline • End - markets are shrinking, overall uncertainty is rising, and competition is increasing as consumers are faced with more alternatives than ever before • Given its historical performance, Norse will likely need to beat Street Consensus and raise expectations consistently for several years, meaningfully inflecting key drivers like revenue and profit growth and demonstrating a more sustainable margin profit, to change investors’ bearish sentiment • As a result, even when Norse results fare well, investors remain uncertain on Norse’s ability to deliver future topline and profit growth which is compounded by significant operating leverage and its impact on profitability • Even if Norse achieves the LTP, or becomes the winning consolidator in the space, the public markets may not re - rate its valuation multiple given the overarching unfavorable Department Store dynamics at play • While there are examples of retailers successfully re - rating their multiple, they typically require a catalyst and high degree of clarity / confidence on long - term strategy that results in re - rating, combined with dramatically step - changed financial performance
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 0 50 100 150 200 250 300 Sep - 19 Mar - 20 Sep - 20 Mar - 21 Sep - 21 Mar - 22 Sep - 22 Mar - 23 Sep - 23 (19.6%) (56.1%) +7.6% Norse Unaffected Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 26.9% (23.2%) 27.5% (24.3%) 42.0% 3.0% L1Y ∆ 85.0% (32.3%) (9.4%) (36.4%) 29.1% (36.5%) L2Y ∆ 31.5% (63.6%) (28.7%) 51.0% (15.7%) (59.9%) L3Y ∆ 44.4% (56.1%) 7.6% (45.1%) (19.6%) (61.4%) L5Y ∆ Macy's Unaffected 46 SECTOR SHARE PRICE PERFORMANCE OVER TIME Source: Capital IQ as of September 3, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of September 3, 2024 3. Represents Macy’s as of unaffected date of December 8, 2023 Share Price Performance Over Time Indexed to 100; Since September 3, 2019 (3) (1) (4) Post Norse Unaffected Period To Current (2) December 8, 2023: Macy’s unaffected share price of $17.39 May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; Share Price increased +5.1% day after earnings January 22, 2024: Macy’s announces it will not enter into an agreement with Arkhouse and Brigade March 18, 2024: Norse unaffected share price of $17.06 August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; Share Price increased +4.2% day after earnings Mar - 24 Sep - 24 July 3, 2024: Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal July 15, 2024 4. Off - Price Retail Peers include ROST, TJX and BURL Macy’s terminates discussions with Arkhouse and Brigade
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 2.0x 0.0x 4.0x 6.0x 8.0x 10.0x 12.0x Sep - 19 Mar - 20 Sep - 20 Mar - 21 Sep - 21 Mar - 22 Sep - 22 Mar - 23 Sep - 23 5.2x 5.1x 3.4x 4.1x 4.6x 3.6x Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 15.6x 5.1x 3.4x 3.7x 5.2x 4.7x Today 14.8x 5.2x 3.4x 3.1x 5.2x 4.4x L1Y Avg. 14.3x 5.2x 3.3x 3.2x 5.2x 4.4x L2Y Avg. 13.6x 4.9x 3.4x 3.8x 4.9x 5.0x L3Y Avg. 14.6x 5.0x 4.4x 4.5x 5.2x 5.2x L5Y Avg. 47 SECTOR VALUATION MULTIPLES OVER TIME Source: Capital IQ as of September 3, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of September 3, 2024 3. Represents Macy’s as of unaffected date of December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL AV / NTM EBITDA Over Time Since September 3, 2019 Macy's Unaffected (3) Norse Unaffected (1) (4) Post Norse Unaffected Period To Current (2) December 8, 2023: Macy’s unaffected multiple of 3.7x November 17, 2022: Kohl’s announces they will not engage in transformative transactions; multiple of 5.6x January 21, 2022: Kohl’s unaffected multiple of 4.0x January 24, 2022: News of takeover offer; Kohl’s affected multiple of 5.1x May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; multiple of 5.1x March 18, 2024: Norse unaffected multiple of 4.7x August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; multiple of 5.5x Mar - 24 Sep - 24 July 3, 2024: Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW $17.06 $18.66 $18.74 $19.98 $21.03 $21.14 – 15.0 20.0 10 15 20 25 30 35 3/15 8/30 +33.8% $22.82 10.0 5.0 (27.1%) (18.9%) 48 NORSE’S SHARE PRICE SINCE UNAFFECTED DATE Source: Capital IQ Note: 1. Market data as of September 3, 2024 Share Price Performance and Trading Volume Over Time (1) Since March 18, 2024 Norse Volume (MM) Share Price ($) April 18, 2024: Erik and Pete Nordstrom file Schedule 13D; Announce formation of Special Committee May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket. Beats on consensus revenue estimates, misses on EPS, and reaffirms guidance Average Volume: 2.9MM Norse Macy’s Kohl’s March 19, 2024: Reuters report of Norse’s potential take - private Volume (MM) March 18, 2024: Unaffected date May 2, 2024: Rumors of Sycamore Partners’ participation on potential take - private transaction August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket. In - line with consensus revenue estimates and beats on consensus EBIT and EPS estimates. Raised low - ends of all guidance ranges 3/18 3/21 3/27 4/3 4/9 4/15 4/19 4/25 5/1 5/7 5/13 5/17 5/23 5/30 6/5 6/11 6/17 6/24 6/28 7/5 7/11 7/17 7/23 7/29 8/2 8/8 8/14 8/20 8/26 9/3
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 49 2.0x 2.5x 3.0x 3.5x 4.5x 5.5x 6.0x Aug - 22 4.1x 4.0x Nov - 22 Feb - 23 May - 23 Aug - 23 Nov - 23 Feb - 24 May - 24 Aug - 24 PEER NTM AV/EBITDA MULTIPLES OVER TIME (SINCE 2022) Source: Company filings, FactSet as of September 3, 2024. 3.0x 5.2x 5.0x 3.4x +15.5% 5.2x +26.1% 5.1x (2.9%) Norse Macy’s Kohl’s AV / NTM EBITDA Multiple Since 2022 July 4, 2024: HBC / Neiman announced Median Peer NTM Multiple: 4.7x Dec. 8, 2023: Leak of buyout bid from Arkhouse Management & Brigade Capital of $21 per share Median Peer NTM Multiple: 4.9x March 19, 2024: Leak of Norse take - private Median Peer NTM Multiple: 4.9x
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 50 Long - Term Growth / PGR 4.00% 4.50% 5.00% 5.50% 6.00% (0.5%) 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 2.8x 2.9x 3.0x 3.1x 3.3x 3.4x 3.6x 3.2x 3.3x 3.4x 3.6x 3.7x 3.9x 4.1x 3.5x 3.7x 3.8x 4.0x 4.2x 4.4x 4.6x 3.9x 4.1x 4.2x 4.4x 4.6x 4.8x 5.1x 4.3x 4.4x 4.6x 4.8x 5.1x 5.3x 5.6x Terminal EBIT Margin UNDERSTANDING NORSE’S MULTIPLE THROUGH POTENTIAL INVESTOR LENS ▪ Given uncertainty in outlook, investors may be contextualizing valuation based on a handicapped view of the go forward cash flow of the business ▪ Current multiple implies investors are factoring in a conservative view of 0% – 2% topline growth and moderate margin expansion ▪ Executing LTP may raise EBITDA, but material re - rating contingent on: – Conviction in sustainability of long - term growth potential and ability to increase margin ; and/or – Investor’s underwriting lower discount rate driven by increased certainty Consensus Implied AV / FY’24E EBITDA Multiple Sensitivity Source: Company filings, FactSet and Capital IQ as of September 3, 2024. Note: DCF illustratively assumes 11.8% weighted average cost of capital, valuation date of August 3, 2024 and applies mid - period discounting. Approximate unaffected AV / ’24E EBITDA multiple
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 51 NORSE HISTORICAL SHARE PRICE PERFORMANCE DRIVEN BY EARNINGS Norse Share Price Decomposition – Last 5 Years NTM EBITDA AV/NTM EBITDA 5.1x $1,637 ($522) (0.5x) $1,114 4.7x Source: Company filings, FactSet and Capital IQ. Note: EBITDA figures unburdened by amortization of developer reimbursements. (1) Reflects April 25, 2015. (2) Reflects change in share count and net debt. (3) Reflects unaffected date of March 18, 2024. $41.05 ($16.78) ($3.21) ($4.00) $17.06 (1) Apr - 19 Δ in Fwd. EBITDA Estimate Δ in AV / EBITDA (2) Δ in Capital Structure (3) Mar - 24
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 52 Source: Company Materials NORSE’S PROFITABILITY HAS ERODED OVER TIME $369 $401 $336 $336 FY2010A FY2015A FY2019A FY2023A 8% 20% 33% 36% FY2010A FY2015A FY2019A FY2023A 12.0% 8.0% 5.4% 3.9% FY2010A FY2015A FY2019A FY2023A Declining Store Productivity Store Only Sales / Avg. Gross Sq. Ft. ($MM) Increased Online Penetration Digital Mix (% of Net Sales) Declining Margins EBIT Margin (%) 7.7% 8.6% 5.4% 5.9% 4% 14% 26% 33% $154 $162 $149 $148 11.4% 8.1% 6.4% 4.1% 4% 14% 24% 29% $188 $165 $144 $118 Macy’s Kohl’s
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 53 7.4% FY2023A FY2024E FY2025E Memo: Consensus % Margin 7.8% 7.6% 7.7% $1.1 $1.2 $1.2 $1.2 $1.2 $1.3 $1.3 FY2026E 1.6% FY2023A FY2024E FY2025E Memo: Consensus % Growth (5.4%) 0.5% 1.8% $14.8 $15.0 $15.3 $14.7 $14.9 $15.3 $15.8 $15.7 FY2026E 3.4% FY2023A FY2024E FY2025E Memo: Consensus % Margin 3.9% 3.7% 3.8% $0.5 $0.6 $0.5 $0.6 $0.6 $0.7 $0.8 FY2026E Total Revenue ($bn) BROAD UNCERTAINTY ON NORSE NEAR - TERM OUTLOOK ACROSS THE STREET Source: Norse management, company filings, Wall Street research, FactSet and Capital IQ as of September 3, 2024. Note: Figures reflect fiscal years ending January the following calendar year. (1) Adj. EBITDA is unburdened by amortization of developer reimbursements. Consensus (shading represents range of analyst estimates) Management’s Current LTP $0.5 $0.6 Adj. EBIT ($bn) $14.5 Adj. EBITDA (1) ($bn) $1.3 $0.9
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 54 Norse Aug. 2024 Mgmt. LTP Norse Aug. 2024 Mgmt. LTP (131) (1) $375 $277 $388 $351 $141 $199 $221 $150 $181 $816 $567 $768 2019A 2023A 2026E 704 $4,459 $4,727 23 $4,905 $3,904 $3,770 $4,739 $6,065 $5,698 $5,675 $15,132 $14,219 $15,319 2019A 2023A 2026E NORSE’S PERFORMANCE EXPECTED TO BE DRIVEN BY RACK AND E - COMMERCE Net Sales EBIT Source: Norse management and Euromonitor. (1) (2) E - Comm market share reflects Net GMV. Segment EBIT margins burdened by allocated corporate expenses. CAGRs Market Share: N Stores 17.0% 21.1% 24.6% R Stores 13.2% 10.4% 10.9% E - Comm (1) 4.6% 2.9% 2.7% EBIT Margin (2) : N Stores 3.6% 2.6% 3.2% R Stores 9.0% 3.7% 4.2% E - Comm 8.4% 5.9% 7.9% Norse 5.4% 4.0% 5.0% Norse Stores E - Comm Discontinued Businesses Rack Stores
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW APPENDIX F RATINGS CONSIDERATIONS 55
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Reflects estimated agency metric as of historical trailing twelve months at fiscal Q2 2024 2. Agency debt adjustments: Moody’s includes operating leases, pensions, and non - standard adjustments; S&P includes operating leases, pensions, and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 3. Agency EBITDAR adjustments: Moody’s includes operating lease expense, pensions, and unusual items; S&P includes operating lease expense, pensions, stock - based compensation, and other; Fitch includes operating lease expense and other 56 NORSE’S CURRENT RATINGS SCORECARD Key Financial Metrics: – Debt / EBITDAR – RCF / Net Debt – EBIT / Interest Other Factors for Ratings Downgrade: – Liquidity maintenance – EBIT to interest expense sustained below 3.25x – Debt / EBITDAR sustained above 4.0x – Lack of improvement in op margins – Rack changes unsuccessful – More aggressive financial strategies Ratings Considerations $4.4Bn Moody’s Debt Estimated Current Agency Adjusted Ratios (1)(2)(3) $1.4Bn Moody’s EBITDAR 3.2x Moody’s Leverage Leverage Breakpoints Rating Illustrative Leverage Breakpoints Debt/EBITDAR <2.5x Baa3 Debt/EBITDAR <3.25x Ba1 Debt/EBITDAR <4.0x Ba2 Debt/EBITDAR <4.75x Ba3 Debt/EBITDAR <5.75x B1 Leverage Breakpoints Rating Debt/EBITDAR <2.5x BBB - Debt/EBITDAR <3.0x BB+ Debt/EBITDAR <4.0x BB Debt/EBITDAR <5.0x BB - Debt/EBITDAR <6.0x B+ Leverage Breakpoints Rating Debt/EBITDAR <3.0x BBB - Debt/EBITDAR <3.5x BB+ Debt/EBITDAR <4.0x BB Debt/EBITDAR <5.0x BB - Debt/EBITDAR <6.0x B+ Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) Key Financial Metrics: – Debt / EBITDAR – FFO / Debt Key Financial Metrics: – Debt / EBITDAR – FCF Margin Current Rating $3.8Bn S&P Debt $1.4Bn S&P EBITDAR 2.7x S&P Leverage $5.7Bn Fitch Debt $1.4Bn Fitch EBITDAR 3.9x Fitch Leverage Other Factors for Ratings Downgrade: – Maintaining Debt / EBITDAR above 3.0x on a sustained basis – Weaker than expected sales in full line and off - price segments – Adj. EBITDA margins remain below 10% – More aggressive financial policy Other Factors for Ratings Downgrade: – Reasonable cash flows for accelerated strategic investments – Sustained structural advantages across the retail space – EBITDA trending below $1.0Bn, which would yield EBITDAR leverage sustaining above 4.0x Morgan Stanley
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 57 NORSE CREDIT RATINGS OVER TIME Last 15 years Source: Moody’s, S&P, Fitch and Refinitiv Eikon. Note: Fitch suspended its rating in June 2020 before reinstating a BBB - rating in March 2021. Change in Rating Change in Outlook S&P Moody’s Fitch BBB+ A - BB+ BBB - 2008 2010 2012 2014 2016 2018 2020 2022 2024 Apr - 09: BBB+ Stable Mar - 10: Positive Outlook Feb - 11: A - Stable Feb - 16: BBB+ Stable Aug - 16: Negative Outlook BBB - Stable Oct - 19: Mar - 20: Negative Outlook Sep - 20: BB+ Negative Mar - 21: Jan - 23: Stable Negative Outlook Outlook Baa1 Baa2 Baa3 Ba1 Ba2 Mar - 09: Baa2 Negative Jan - 10: Stable Outlook Feb - 11: Baa1 Stable Jun - 19: Negative Outlook Oct - 19: Baa2 Stable Apr - 20: Baa3 Negative Sep - 21: Ba1 Stable Apr - 23: Negative Outlook Apr - 24: Ba2 Stable A - BBB+ BBB - BB+ BB BBB Nov - 04: A - Mar - 15: BBB+ Mar - 20: BBB Mar - 21: BBB - Jan - 23: BB+ Apr - 24: BB Jan - 16: Negative Watch Centerview
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 3.7x 3.1x 2.7x BB - 5.0x BB 4.0x 3.9x 2024PF 2025 2026 2.9x 2.3x 1.9x 2.7x BB 4.0x BB+ 3.0x 2024PF 2025 2026 2.9x 2.4x 2.0x Ba3 4.8x Ba2 4.0x 3.2x 2024PF 2025 2026 Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) Agency - Defined Debt ($Bn) (5) Agency - Defined EBITDAR ($Bn) (6) Projected Leverage Ratio (1)(2)(3) $4.7 $5.2 $5.7 $3.2 $3.8 $4.2 $3.2 $3.8 $4.2 $1.7 $1.7 $1.5 $1.7 $1.6 $1.5 $1.7 $1.6 $1.4 Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Pro forma; assumes $23.00 offer price, transaction close on February 1, 2025, minimum cash balance of $100MM, all excess cash used to pay down debt, and management and Liverpool roll current ownership interests Ratings Triggers Current (4) LEVERAGE NEUTRAL TRANSACTION Management Long - Term Plan Morgan Stanley 2. Projections based on Management Long - Term Plan as of August 2024 3. Agency ratings trigger ratios, per agency - defined total debt, net debt, and EBITDAR: Moody’s reflects total debt / EBITDAR, S&P reflects net debt / EBITDAR, and Fitch reflects total debt / EBITDAR 4. Reflects estimate of related agency metric as of historical trailing twelve months at fiscal Q2 2024; reflects cash paydown of April 2024 notes ($250MM) 5. Agency debt adjustments: Moody’s includes operating leases and non - standard adjustments; S&P includes operating leases and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 6. Agency EBITDAR adjustments: Moody’s includes operating lease expense and unusual items; S&P includes operating lease expense, stock - based compensation, and other; Fitch includes operating lease expense and other 58
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 4.0x 3.3x 2.7x BB - 5.0x BB 4.0x 3.9x 2024PF 2025 2026 3.1x 2.5x 1.9x 2.7x BB 4.0x BB+ 3.0x 2024PF 2025 2026 3.2x 2.6x 2.0x Ba3 4.8x Ba2 4.0x 3.2x 2024PF 2025 2026 Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) Agency - Defined Debt ($Bn) (5) Agency - Defined EBITDAR ($Bn) (6) Projected Leverage Ratio (1)(2)(3) $4.7 $5.5 $6.0 $3.2 $4.2 $4.6 $3.3 $4.1 $4.6 $1.7 $1.7 $1.5 $1.7 $1.6 $1.5 $1.7 $1.6 $1.4 Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Pro forma; assumes $23.00 offer price, transaction close on February 1, 2025, minimum cash balance of $100MM, excess cash used to pay down debt, management and Liverpool roll current ownership interests and incremental $325MM of debt drawn via new ~$1.2Bn ABL at an assumed rate of SOFR + 200 bps Ratings Triggers Current (4) OFFER LEVERAGE OF $325MM Management Long - Term Plan Morgan Stanley 2. Projections based on Management Long - Term Plan as of August 2024 3. Agency ratings trigger ratios, per agency - defined total debt, net debt, and EBITDAR: Moody’s reflects total debt / EBITDAR, S&P reflects net debt / EBITDAR, and Fitch reflects total debt / EBITDAR 4. Reflects estimate of related agency metric as of historical trailing twelve months at fiscal Q2 2024; reflects cash paydown of April 2024 notes ($250MM) 5. Agency debt adjustments: Moody’s includes operating leases and non - standard adjustments; S&P includes operating leases and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 6. Agency EBITDAR adjustments: Moody’s includes operating lease expense and unusual items; S&P includes operating lease expense, stock - based compensation, and other; Fitch includes operating lease expense and other 59
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 60 APPENDIX G PROCESS SUMMARY
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 24 11 8 7 1 1 Initial Outreach / Inbounds NDA Signed Management Presentation Follow - up Requests Received Indication of Interest Received Final Offer OUTREACH SUMMARY Strategic Partner Sovereign Wealth Fund / Family Office Financial Sponsor Note: 1. Management conducted a virtual preview meeting with December 13, 2023 Verbal Indication for Financing Sale Leaseback + Perpetual Preferred Investment with 13% coupon Remaining Strategic Partners (1) 1) Group + Family Offer 61
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 62 OUTREACH SUMMARY Counterparty Outreach Date / NDA Management Inbound Signed Meeting Date Management Meeting Details Management Meeting Attendees Follow Up Session Date Status Final Offer 1/7/24 ᴣ 1/18/24 Meeting at Centerview Partners (NYC) 1/30/24 Passed 1/8/24 ᴣ 2/2/24 Meeting at Norse Headquarters and store walk 2/9/24 Passed Moelis ᴣ 3/19/24 Meeting at Norse Headquarters Passed ) nbound week of 3/18 ( Passed 1/8/24 ᴣ 1/29/24 Meeting at Morgan Stanley (LA) Passed 1/9/24 ᴣ 1/17/24 Meeting at Centerview Partners (NYC) Passed Inbound ᴣ 1/17/24 Meeting at 1/26/24 Passed 10/31/23 ᴣ Passed 11/1/23 Passed 10/31/23 ᴣ Passed Inbound ᴣ 6/05/24 Virtual Passed 11/26/23 ᴣ 1/25/24 Meeting at Morgan Stanley, store walk and dinner (LA) • Graciano Guichard Gonzalez, Chief Executive Officer • Enrique Güijosa Hidalgo, Chief Financial Officer 8/15/24 Bid Received $23.00 / share Inbound Passed Financial Sponsors 7 Strategic Partners 6 Note: 1. Management conducted a preview meeting with 12/13/23 on Zoom
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW OUTREACH SUMMARY Status Follow Up Session Date Management Meeting Date NDA Signed Outreach Date Counterparty Passed 11/3/23 Sovereign Wealth Funds / Family Offices 11 Passed 12/7/23 Passed 11/3/23 Passed 10/15/23 Passed 12/8/23 Passed 10/15/23 Passed 10/31/23 Passed 12/13/23 Passed 12/7/23 Passed 12/7/23 Passed 10/15/23 63
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW OVERVIEW OF POSSIBLE STRATEGIC ALTERNATIVES 4 Monetize Real Estate 3 Enhanced Buyback 2 Dividend Enhancement 1 Continue to Execute LTP • Execute sale leaseback transactions of the Company’s owned real estate portfolio and distribute proceeds to shareholders • Use excess cash flow to establish robust buyback program • Payout excess year - end cash as a dividend each year • Execute Baseline LTP and consistently beat Street estimates Descriptio n x Unlock value to distribute to shareholders or reinvest in core business x Streamlined operations and strategic footprint x Execution does not require new counterparty x Enhanced capital return profile x Advantageous in current valuation context relative to historical trading levels x Evolves shareholder base towards long - term oriented investors x Sends long - term confidence signal on future free cash flow generation x Immediate cash realization for shareholders x Management LTP implies outperformance vs . Street Consensus x Solid foundation for execution with clean inventory position, Canada exit and optimized supply chain Benefits X Increase in rental payments will decrease EBITDA going forward X Challenging environment for real estate sales / elevated cap rate environment X Potential for tax leakage, depending on basis X Increases risk of ratings downgrade X Indirectly increases Family / Liverpool stake X Success varies based on timing of repurchases and valuation at execution X Potentially signals lack of investment opportunities X Investors typically do not seek dividend yield from discretionary consumer sector X Taxable event for shareholders X Potentially signals lack of investment opportunities X Investors likely to expect annual dividend increases going forward X Investors may not re - rate JWN’s multiple even with outperformance X Negative investor sentiment in the sector persists X Weak trading / execution at peers has created an unfavorable backdrop for JWN X JWN may be a target for future activists given its low multiple Considerations Limited Limited Limited Moderate Value Creatio n High Low Low Moderate Execution Complexit y 64
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW OVERVIEW OF POSSIBLE STRATEGIC ALTERNATIVES 8 Full Sale to Private Equity or Strategic 7 Partnership with Liverpool and New Long - term Investor(s) 6 Increase Liverpool Stake via Tender Offer 5 Separate Rack • Sell the business to a strategic acquiror or financial sponsor • Optimize shareholder base by inviting Liverpool to partner with additional strategic investors to increase ownership • Liverpool increases its stake via a Tender Offer • Separate Full - Line (“Namesake”) and Rack into two distinct businesses with separate management teams and shareholders Descriptio n x Immediate monetization for all shareholders x Immediate monetization for public shareholders x Demonstrated inbound interest x New debt financing not likely required x Aligns shareholder base with long - term focus x Nordstrom Family could roll ownership stake x Provides current shareholders an opportunity to tender at a premium x Transitions shareholder base to more of a long - term orientation x Signal of validation from major existing shareholder and strategic investor x Potential value upside if Rack re - rates towards Off - Price peer multiples x Optimize management team and strategy around single distribution channel x Increases specialized operational expertise at each separated business Benefits X Limited universe of strategic acquirors X Limited financing available for sponsors X Likely requires refinancing existing debt X Recent trading levels and public Department Store peers may be valuation reference X Control / governance to be negotiated among buying parties X New investors will require eventual liquidity event via stake sale / re - IPO X Recent trading levels and public Department Store peers may be valuation reference X Likely to reduce trading volume / liquidity of stock X Transaction may be perceived as a step towards a take - private or entrenchment of family / management X Liverpool's willingness to pay a premium for a larger minority stake X Facilitating increase in Liverpool stake could be seen as inconsistent with rationale for poison pill adoption (i.e., ensuring shareholders receive control premium for sale of control) X Viability of Rack as standalone public entity in light of current scale and recent performance X Potential multiple contraction for Namesake towards Macy’s and Kohl’s X Ongoing dis - synergies and stranded costs from separation Considerations Material Material Limited Moderate Value Creatio n High Moderate Moderate High Execution Complexit y 65
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 66 Summary ▪ In a change of control repurchase event (“CoC”) Norse is required to offer to repurchase the notes at 101% of the principal plus accrued interest ▪ All of the following must occur to trigger a change of control repurchase event: 1 – Change of control (e.g. consummation of a transaction in which a person or group gains majority voting power) 2 – Notes are rated below investment grade by each of the rating agencies following the announcement of a change of control 3 – Rating on the notes is lowered by each of the rating agencies , as a result of the change of control Selected Excerpts “If a change of control repurchase event occurs… we will make an offer to each holder of exchange notes to repurchase all or any part… at a repurchase price in cash equal to 101% of the aggregate principal amount… plus any accrued and unpaid interest on such exchange notes…” “ ’Change of control repurchase event ’ means the occurrence of both a change of control and a below investment grade rating event.” “ ’Below investment grade rating event ’ means the rating on the exchange notes is lowered by each of the rating agencies and the exchange notes are rated below investment grade by each of the rating agencies on any date from the date of the public notice of an arrangement that could result in a change of control… … A below investment grade rating event… shall not be deemed to have occurred in respect of a particular change of control… if any of the rating agencies making the reduction in rating to which this definition would otherwise apply does not announce or publicly confirm… that the reduction was the result… of the applicable change of control ” BONDS’ CHANGE OF CONTROL PROVISION Source: Norse indentures. Note: Norse’s 2028 debentures do not have a change of control trigger. .
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 67 LEGAL DISCLAIMER – MORGAN STANLEY We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. We have prepared this document and the analyses contained in it based, in part, on certain assumptions and information obtained by us from the recipient, its directors, officers, employees, agents, affiliates and/or from other sources. Our use of such assumptions and information does not imply that we have independently verified or necessarily agree with any of such assumptions or information, and we have assumed and relied upon the accuracy and completeness of such assumptions and information for purposes of this document. Neither we nor any of our affiliates, or our or their respective officers, employees or agents, make any representation or warranty, express or implied, in relation to the accuracy or completeness of the information contained in this document or any oral information provided in connection herewith, or any data it generates and accept no responsibility, obligation or liability (whether direct or indirect, in contract, tort or otherwise) in relation to any of such information. We and our affiliates and our and their respective officers, employees and agents expressly disclaim any and all liability which may be based on this document and any errors therein or omissions therefrom. Neither we nor any of our affiliates, or our or their respective officers, employees or agents, make any representation or warranty, express or implied, that any transaction has been or may be effected on the terms or in the manner stated in this document, or as to the achievement or reasonableness of future projections, management targets, estimates, prospects or returns, if any. Any views or terms contained herein are preliminary only, and are based on financial, economic, market and other conditions prevailing as of the date of this document and are therefore subject to change. We undertake no obligation or responsibility to update any of the information contained in this document. Past performance does not guarantee or predict future performance. This document and the information contained herein do not constitute an offer to sell or the solicitation of an offer to buy any security, commodity or instrument or related derivative, nor do they constitute an offer or commitment to lend, syndicate or arrange a financing, underwrite or purchase or act as an agent or advisor or in any other capacity with respect to any transaction, or commit capital, or to participate in any trading strategies, and do not constitute legal, regulatory, accounting or tax advice to the recipient. We recommend that the recipient seek independent third party legal, regulatory, accounting and tax advice regarding the contents of this document. This document does not constitute and should not be considered as any form of financial opinion or recommendation by us or any of our affiliates. This document is not a research report and was not prepared by the research department of Morgan Stanley or any of its affiliates. Notwithstanding anything herein to the contrary, each recipient hereof (and their employees, representatives, and other agents) may disclose to any and all persons, without limitation of any kind from the commencement of discussions, the U.S. federal and state income tax treatment and tax structure of the proposed transaction and all materials of any kind (including opinions or other tax analyses) that are provided relating to the tax treatment and tax structure. For this purpose, "tax structure" is limited to facts relevant to the U.S. federal and state income tax treatment of the proposed transaction and does not include information relating to the identity of the parties, their affiliates, agents or advisors. This document is provided by Morgan Stanley & Co. LLC and/or certain of its affiliates or other applicable entities, which may include Morgan Stanley Realty Incorporated, Morgan Stanley Senior Funding, Inc., Morgan Stanley Bank, N.A., Morgan Stanley & Co. International plc, Morgan Stanley Securities Limited, Morgan Stanley Bank AG, Morgan Stanley MUFG Securities Co., Ltd., Mitsubishi UFJ Morgan Stanley Securities Co., Ltd., Morgan Stanley Asia Limited, Morgan Stanley Australia Securities Limited, Morgan Stanley Australia Limited, Morgan Stanley Asia (Singapore) Pte., Morgan Stanley Services Limited, Morgan Stanley & Co. International plc Seoul Branch and/or Morgan Stanley Canada Limited Unless governing law permits otherwise, you must contact an authorized Morgan Stanley entity in your jurisdiction regarding this document or any of the information contained herein. © Morgan Stanley and/or certain of its affiliates. All rights reserved.
PRELIMINARY & CONFIDENTIAL DRAFT | SUBJECT TO REVIEW 68 LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit (c)(xi)
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW PROJECT NORSE UPDATE OCTOBER 2, 2024
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW PROPOSED TRANSACTION SUMMARY 2 Notes Reflecting Latest Proposal $MM $MM $MM Sources # • Estimate for FY2024 year - end $620 $620 $620 Company Cash on Balance Sheet 1 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,690 2,615 Company Existing Debt 2 • Likely funded through $1 - 1.2Bn ABL, with drawn balance paid off 1 year after transaction close to • Commitment letters to be provided at signing 400 325 250 New Transaction Debt 3 • Current holdings (49.6MM shares) 1,184 1,146 1,141 Family Investor Equity Roll 4 • Direct loan from Liverpool to Family Group (carried on Liverpool Balance Sheet) 454 467 454 Family New Equity 5 • Current holdings (15.8MM shares) 374 362 362 Liverpool Equity Roll 6 • Likely funded through $1.2Bn Balance Sheet cash with debt covering potential shortfall 1,257 1,244 1,226 Liverpool New Equity 7 $6,980 $6,855 $6,669 Total Sources Notes Reflecting Latest Proposal $MM $MM $MM Uses # • Based on Q2 2024A basic shares outstanding (164.2MM) plus dilutive equity securities at assumed transaction close of ~0.6MM in - the - money options and ~0.5MM of vested RSUs at $23.75 / share $3,925 $3,800 $3,764 Company Equity Value 8 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,690 2,615 Existing Debt 9 • Unfunded balance ($168MM) to be funded into trust upon transaction close • Family Group to waive $28MM portion • Treated as transaction fees 140 140 140 SERP Funding 10 • Fully accounts for advisor fee estimates provided by Company advisors and financing fees required to consummate the transaction 125 125 50 Preliminary Transaction Fees 11 • Based on Family Group advisor estimates, with new $1 - 1.2Bn ABL facility intended to fund seasonal working capital and liquidity needs 100 100 100 Minimum Cash 12 $6,980 $6,855 $6,669 Total Uses $23.75 $23.00 $23.00 Memo: Price Per Share ▪ Proposal contemplates in - the - money options and RSUs that vest by assumed transaction close; unvested PSUs and RSUs of ~9MM to be replaced by revised compensation plan ▪ The details of the revised compensation plan have not been provided by the Bid Group and may create a new balance sheet liability ▪ Proposal introduces a termination right of the Bid Group in the event of a “change of control” repurchase trigger under the Company’s debt instruments Initial Revision Original Key Revisions vs. Prior Offer Second Revision
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW Illustrative Price Per Share Aggregate Value $6,733 $6,688 $6,600 $6,511 $6,423 $6,335 $6,246 $6,158 $6,026 5.7x 5.7x 5.6x 5.5x 5.5x 5.4x 5.3x 5.2x 5.1x $1,178 Management LTP - 2024E 5.9x 5.9x 5.8x 5.7x 5.7x 5.6x 5.5x 5.4x 5.3x $1,133 Consensus - 2024E 10.0% 10.2% 10.7% 11.1% 11.6% 12.1% 12.6% 13.1% 13.9% Internal Rate of Return (IRR) 1.6x 1.6x 1.6x 1.7x 1.7x 1.7x 1.8x 1.8x 1.8x Multiple on Invested Capital (MOIC) Moody's S&P 3.2x 3.3x 3.3x 3.4x 3.4x 3.4x 3.4x 3.2x 3.2x 3.4x 3.4x 3.3x 3.3x 3.3x 3.2x 3.2x 3.2x 3.1x Illustrative Agency - Defined AV / Adj. EBITDA (3) Illustrative Bid Group Returns (4,5) $27.00 $26.75 $26.25 $25.75 $25.25 $24.75 $24.25 +14% +13% +11% +8% +6% +4% +2% $23.75 $23.00 Metric +58% +57% +54% +51% +48% +45% +42% +39% +35% $17.06 vs. Unaffected (3/18/24) +42% +40% +38% +35% +32% +30% +27% +24% +21% $19.08 Premium / vs. Unaffected 30D VWAP +18% +17% +15% +13% +11% +8% +6% +4% +1% $22.82 (Discount) vs. Pre - Proposal (9/3/24) +20% +19% +17% +14% +12% +10% +8% +6% +2% $22.49 vs. Current (9/30/24) 174.9 174.8 174.8 174.7 174.7 174.7 174.6 174.6 174.5 Diluted Shares Outstanding (1) $4,721 $4,677 $4,588 $4,500 $4,411 $4,323 $4,235 $4,147 $4,014 Equity Value 2,011 2,011 2,011 2,011 2,011 2,011 2,011 2,011 2,011 Plus: Status Quo Current Net Debt (2) 3 ILLUSTRATIVE NORSE TAKE PRIVATE AT VARIOUS PRICES Source: Norse management, Moody’s, S&P, Fitch, company filings and FactSet as of September 30, 2024, except where otherwise noted. (6) Note: Dollars in millions, except per share amounts. (1) Includes all outstanding options, unvested RSUs and unvested PSUs. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. (2) Reflects current debt of $2,690 and cash of $679. (3) Adj. EBITDA figures unburdened by amortization of developer reimbursements. (4) Assumes illustrative 4.5x AV / LTM EBITDA exit at FY’28E year - end. (5) Illustratively assumes the management LTP, transaction close on February 1, 2025, 100% of excess cash flow post - close swept to common equity as dividends after drawn ABL balance is paid down, $100mm minimum cash and illustrative total transaction fees of $125mm, any incremental purchase price is funded by new transaction debt and ABL cost as outlined in the commitment letter draft. Illustrative ratings breakpoints at various prices not reflective of other potential qualitative factors Illustrative Breakpoints (6) Moody’s: 4.0x S&P: 3.0x 4.2x 4.2x 4.2x 4.2x 4.1x 4.1x 4.1x 4.0x 4.0x Fitch Fitch: 4.0x Leverage Ratios $726 $701 $651 $601 $551 $500 $450 $400 $325 Memo: New Transaction Debt (2024E PF) (5) +$50 +$100 +$151 +$201 +$251 +$301 +$326 – Incremental Capital vs. 9/26 Proposal ($75) Bid Group Funding
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW 67 LEGAL DISCLAIMER – MORGAN STANLEY We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. We have prepared this document and the analyses contained in it based, in part, on certain assumptions and information obtained by us from the recipient, its directors, officers, employees, agents, affiliates and/or from other sources. Our use of such assumptions and information does not imply that we have independently verified or necessarily agree with any of such assumptions or information, and we have assumed and relied upon the accuracy and completeness of such assumptions and information for purposes of this document. Neither we nor any of our affiliates, or our or their respective officers, employees or agents, make any representation or warranty, express or implied, in relation to the accuracy or completeness of the information contained in this document or any oral information provided in connection herewith, or any data it generates and accept no responsibility, obligation or liability (whether direct or indirect, in contract, tort or otherwise) in relation to any of such information. We and our affiliates and our and their respective officers, employees and agents expressly disclaim any and all liability which may be based on this document and any errors therein or omissions therefrom. Neither we nor any of our affiliates, or our or their respective officers, employees or agents, make any representation or warranty, express or implied, that any transaction has been or may be effected on the terms or in the manner stated in this document, or as to the achievement or reasonableness of future projections, management targets, estimates, prospects or returns, if any. Any views or terms contained herein are preliminary only, and are based on financial, economic, market and other conditions prevailing as of the date of this document and are therefore subject to change. We undertake no obligation or responsibility to update any of the information contained in this document. Past performance does not guarantee or predict future performance. This document and the information contained herein do not constitute an offer to sell or the solicitation of an offer to buy any security, commodity or instrument or related derivative, nor do they constitute an offer or commitment to lend, syndicate or arrange a financing, underwrite or purchase or act as an agent or advisor or in any other capacity with respect to any transaction, or commit capital, or to participate in any trading strategies, and do not constitute legal, regulatory, accounting or tax advice to the recipient. We recommend that the recipient seek independent third party legal, regulatory, accounting and tax advice regarding the contents of this document. This document does not constitute and should not be considered as any form of financial opinion or recommendation by us or any of our affiliates. This document is not a research report and was not prepared by the research department of Morgan Stanley or any of its affiliates. Notwithstanding anything herein to the contrary, each recipient hereof (and their employees, representatives, and other agents) may disclose to any and all persons, without limitation of any kind from the commencement of discussions, the U.S. federal and state income tax treatment and tax structure of the proposed transaction and all materials of any kind (including opinions or other tax analyses) that are provided relating to the tax treatment and tax structure. For this purpose, "tax structure" is limited to facts relevant to the U.S. federal and state income tax treatment of the proposed transaction and does not include information relating to the identity of the parties, their affiliates, agents or advisors. This document is provided by Morgan Stanley & Co. LLC and/or certain of its affiliates or other applicable entities, which may include Morgan Stanley Realty Incorporated, Morgan Stanley Senior Funding, Inc., Morgan Stanley Bank, N.A., Morgan Stanley & Co. International plc, Morgan Stanley Securities Limited, Morgan Stanley Bank AG, Morgan Stanley MUFG Securities Co., Ltd., Mitsubishi UFJ Morgan Stanley Securities Co., Ltd., Morgan Stanley Asia Limited, Morgan Stanley Australia Securities Limited, Morgan Stanley Australia Limited, Morgan Stanley Asia (Singapore) Pte., Morgan Stanley Services Limited, Morgan Stanley & Co. International plc Seoul Branch and/or Morgan Stanley Canada Limited Unless governing law permits otherwise, you must contact an authorized Morgan Stanley entity in your jurisdiction regarding this document or any of the information contained herein. © Morgan Stanley and/or certain of its affiliates. All rights reserved.
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW 68 LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit (c)(xii)
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW PROJECT NORSE UPDATE OCTOBER 11, 2024
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW PROPOSED TRANSACTION SUMMARY 2 $MM Notes Reflecting Latest Proposal $MM $MM $MM Uses # $3,966 • Based on Q2 2024A basic shares outstanding (164.2MM) plus dilutive equity securities at assumed transaction close of ~0.6MM in - the - money options and ~0.5MM of vested RSUs at $24.00 / share $3,925 $3,800 $3,764 Company Equity Value 8 2,690 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,690 2,615 Existing Debt 9 • Unfunded balance ($168MM) to be funded into trust upon transaction close 140 • Family Group to waive $28MM portion • Treated as transaction fees 140 140 140 SERP Funding 10 125 • Fully accounts for advisor fee estimates provided by Company advisors and financing fees required to consummate the transaction 125 125 50 Preliminary Transaction Fees 11 100 • Based on Family Group advisor estimates, with new $1 - 1.2Bn ABL facility intended to fund seasonal working capital and liquidity needs 100 100 100 Minimum Cash 12 $7,021 $6,980 $6,855 $6,669 Total Uses $24.00 $23.75 $23.00 $23.00 Memo: Price Per Share Third Revision Second Revision Initial Revision Original Notes Reflecting Latest Proposal $MM $MM $MM $MM # Sources • Estimate for FY2024 year - end $620 $620 $620 $620 1 Company Cash on Balance Sheet • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,690 2,690 2,615 2 Company Existing Debt • Likely funded through $1 - 1.2Bn ABL, with drawn balance paid off 1 year after transaction close 425 400 325 250 3 New Transaction Debt • Commitment letter to be provided at signing • Current holdings (49.6MM shares) 1,196 1,184 1,146 1,141 4 Family Investor Equity Roll • Direct loan from Liverpool to Family Group (carried on Liverpool Balance Sheet) 450 454 467 454 5 Family New Equity • Current holdings (15.8MM shares) 378 374 362 362 6 Liverpool Equity Roll • Likely funded through $1.2Bn Balance Sheet cash with debt covering potential shortfall 1,262 1,257 1,244 1,226 7 Liverpool New Equity $7,021 $6,980 $6,855 $6,669 Total Sources ▪ Proposal contemplates in - the - money options and RSUs that vest by assumed transaction close; unvested PSUs and RSUs of ~9MM to be replaced by revised compensation plan ▪ The details of the revised compensation plan have not been provided by the Bid Group and may create a new balance sheet liability Key Revisions vs. Prior Offer
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW Illustrative Price Per Share Prior Proposals Prior Counters Aggregate Value $6,026 $6,158 $6,202 $6,290 $6,379 $6,467 $6,511 $6,733 AV / Adj. EBITDA (3) Illustrative Bid Group Returns (4,5) Illustrative Agency - Defined $27.00 $25.75 $25.50 $25.00 $24.50 $24.00 $23.75 $23.00 +17% +12% +11% +9% +7% +4% +3% – Metric +58% +51% +49% +47% +44% +41% +39% +35% $17.06 vs. Unaffected (3/18/24) +42% +35% +34% +31% +28% +26% +24% +21% $19.08 vs. Unaffected 30D VWAP Premium / +18% +13% +12% +10% +7% +5% +4% +1% $22.82 vs. Pre - Proposal (9/3/24) (Discount) +23% +17% +16% +14% +12% +9% +8% +5% $21.94 vs. Current (10/9/24) 174.9 174.7 174.7 174.7 174.7 174.6 174.6 174.5 Diluted Shares Outstanding (1) $4,721 $4,500 $4,456 $4,367 $4,279 $4,191 $4,147 $4,014 Equity Value 2,011 2,011 2,011 2,011 2,011 2,011 2,011 2,011 Plus: Status Quo Current Net Debt (2) 3 ILLUSTRATIVE NORSE TAKE PRIVATE AT VARIOUS PRICES Source: Norse management, Moody’s, S&P, Fitch, company filings and FactSet as of October 9, 2024, except where otherwise noted. (6) Note: Dollars in millions, except per share amounts. (1) Includes all outstanding options, unvested RSUs and unvested PSUs. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. (2) Reflects current debt of $2,690 and cash of $679. (3) Adj. EBITDA figures unburdened by amortization of developer reimbursements. (4) Assumes illustrative 4.5x AV / LTM EBITDA exit at FY’28E year - end. (5) Illustratively assumes the management LTP, transaction close on February 1, 2025, 100% of excess cash flow post - close swept to common equity as dividends after drawn ABL balance is paid down, $100mm minimum cash and illustrative total transaction fees of $125mm, any incremental purchase price is funded by new transaction debt and ABL cost as outlined in the commitment letter draft. Illustrative ratings breakpoints at various prices not reflective of other potential qualitative factors 5.7x 5.5x 5.5x 5.4x 5.3x 5.3x 5.2x 5.1x $1,178 Management LTP - 2024E 5.9x 5.7x 5.7x 5.6x 5.6x 5.5x 5.4x 5.3x $1,133 Consensus - 2024E 10.0% 11.1% 11.4% 11.8% 12.3% 12.8% 13.1% 13.9% Internal Rate of Return (IRR) 1.6x 1.7x 1.7x 1.7x 1.7x 1.8x 1.8x 1.8x Multiple on Invested Capital (MOIC) 3.4x 3.4x 3.3x 3.3x 3.3x 3.2x 3.2x 3.2x Illustrative Breakpoints (6) Moody's 3.4x 3.3x 3.3x 3.2x 3.2x 3.2x 3.2x 3.1x Moody’s: 4.0x S&P: 3.0x S&P 4.2x 4.2x 4.1x 4.1x 4.1x 4.0x 4.0x 4.0x Fitch Fitch: 4.0x Leverage Ratios $726 $601 $576 $525 $475 $425 $400 $325 Memo: New Transaction Debt (2024E PF) (5) +$50 +$100 +$151 +$176 +$301 – Incremental Capital vs. 10/9 Proposal ($100) ($25) Bid Group Funding vs. $23.00
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW LEGAL DISCLAIMER – MORGAN STANLEY We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. We have prepared this document and the analyses contained in it based, in part, on certain assumptions and information obtained by us from the recipient, its directors, officers, employees, agents, affiliates and/or from other sources. Our use of such assumptions and information does not imply that we have independently verified or necessarily agree with any of such assumptions or information, and we have assumed and relied upon the accuracy and completeness of such assumptions and information for purposes of this document. Neither we nor any of our affiliates, or our or their respective officers, employees or agents, make any representation or warranty, express or implied, in relation to the accuracy or completeness of the information contained in this document or any oral information provided in connection herewith, or any data it generates and accept no responsibility, obligation or liability (whether direct or indirect, in contract, tort or otherwise) in relation to any of such information. We and our affiliates and our and their respective officers, employees and agents expressly disclaim any and all liability which may be based on this document and any errors therein or omissions therefrom. Neither we nor any of our affiliates, or our or their respective officers, employees or agents, make any representation or warranty, express or implied, that any transaction has been or may be effected on the terms or in the manner stated in this document, or as to the achievement or reasonableness of future projections, management targets, estimates, prospects or returns, if any. Any views or terms contained herein are preliminary only, and are based on financial, economic, market and other conditions prevailing as of the date of this document and are therefore subject to change. We undertake no obligation or responsibility to update any of the information contained in this document. Past performance does not guarantee or predict future performance. This document and the information contained herein do not constitute an offer to sell or the solicitation of an offer to buy any security, commodity or instrument or related derivative, nor do they constitute an offer or commitment to lend, syndicate or arrange a financing, underwrite or purchase or act as an agent or advisor or in any other capacity with respect to any transaction, or commit capital, or to participate in any trading strategies, and do not constitute legal, regulatory, accounting or tax advice to the recipient. We recommend that the recipient seek independent third party legal, regulatory, accounting and tax advice regarding the contents of this document. This document does not constitute and should not be considered as any form of financial opinion or recommendation by us or any of our affiliates. This document is not a research report and was not prepared by the research department of Morgan Stanley or any of its affiliates. Notwithstanding anything herein to the contrary, each recipient hereof (and their employees, representatives, and other agents) may disclose to any and all persons, without limitation of any kind from the commencement of discussions, the U.S. federal and state income tax treatment and tax structure of the proposed transaction and all materials of any kind (including opinions or other tax analyses) that are provided relating to the tax treatment and tax structure. For this purpose, "tax structure" is limited to facts relevant to the U.S. federal and state income tax treatment of the proposed transaction and does not include information relating to the identity of the parties, their affiliates, agents or advisors. This document is provided by Morgan Stanley & Co. LLC and/or certain of its affiliates or other applicable entities, which may include Morgan Stanley Realty Incorporated, Morgan Stanley Senior Funding, Inc., Morgan Stanley Bank, N.A., Morgan Stanley & Co. International plc, Morgan Stanley Securities Limited, Morgan Stanley Bank AG, Morgan Stanley MUFG Securities Co., Ltd., Mitsubishi UFJ Morgan Stanley Securities Co., Ltd., Morgan Stanley Asia Limited, Morgan Stanley Australia Securities Limited, Morgan Stanley Australia Limited, Morgan Stanley Asia (Singapore) Pte., Morgan Stanley Services Limited, Morgan Stanley & Co. International plc Seoul Branch and/or Morgan Stanley Canada Limited Unless governing law permits otherwise, you must contact an authorized Morgan Stanley entity in your jurisdiction regarding this document or any of the information contained herein. © Morgan Stanley and/or certain of its affiliates. All rights reserved. 4
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview. 5
Exhibit (c)(xiii)
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW PROJECT NORSE UPDATE OCTOBER 13, 2024
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW PROPOSED TRANSACTION SUMMARY 2 Note: Proposal contemplates in - the - money options and RSUs that vest by assumed transaction close; unvested PSUs and RSUs of ~9MM to be replaced by revised compensation plan The details of the revised compensation plan have not been provided by the Bid Group and may create a new balance sheet liability. Notes Reflecting Latest Proposal $MM # Sources $MM $MM $MM • Estimate for FY2024 year - end $620 $620 $620 $620 1 Company Cash on Balance Sheet • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,690 2,690 2,615 2 Company Existing Debt • Likely funded through $1 - 1.2Bn ABL, with drawn balance paid off 1 year after transaction close • Commitment letter to be provided at signing 425 325 400 250 3 New Transaction Debt • Current holdings (49.6MM shares) 1,196 1,146 1,184 1,141 4 Family Investor Equity Roll • Direct loan from Liverpool to Family Group (carried on Liverpool Balance Sheet) 450 467 454 454 5 Family New Equity • Current holdings (15.8MM shares) 378 362 374 362 6 Liverpool Equity Roll • Likely funded through $1.2Bn Balance Sheet cash with debt covering potential shortfall 1,262 1,244 1,257 1,226 7 Liverpool New Equity $7,021 Total Sources $6,669 $6,855 $6,980 Notes Reflecting Latest Proposal $MM # Uses $MM $MM $MM • Based on Q2 2024A basic shares outstanding (164.2MM) plus dilutive equity securities at assumed transaction close of ~0.6MM in - the - money options and ~0.5MM of vested RSUs at $24.00 / share $3,966 $3,800 $3,925 $3,764 8 Company Equity Value • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,690 2,690 2,615 9 Existing Debt • Unfunded balance ($168MM) to be funded into trust upon transaction close • Family Group to waive $28MM portion • Treated as transaction fees 140 140 140 140 10 SERP Funding • Fully accounts for advisor fee estimates provided by Company advisors and financing fees required to consummate the transaction 125 125 125 50 11 Preliminary Transaction Fees • Based on Family Group advisor estimates, with new $1 - 1.2Bn ABL facility intended to fund seasonal working capital and liquidity needs 100 100 100 100 12 Minimum Cash $7,021 Total Uses $6,669 $6,855 $6,980 $24.00 Memo: Price Per Share $23.00 $23.00 $23.75 Initial Revision Original Second Third Revision Revision
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW ▪ We continue to recommend seeking RES/RAS prior to signing and announcement of a transaction – The Rating Agencies will require a financial model / operating case inclusive of Q4 2024 and FY2025 projections – All ratings outcomes from RES / RAS are predicated upon achieving the EBITDA projections, subject to an estimated 15 - 20% cushion ▪ Following receipt of RES / RAS feedback, signing and announcement of a transaction and publication of the Rating Agencies’ feedback, we expect the natural touch point between the Bidding Group / Company with the Rating Agencies to be after the holiday season - consistent with normal course ▪ In FY2023, Norse reported Q4 results on March 5, 2024, and we expect a similar timing for publication of Q4 / FY2024 results in 2025 ▪ The Company and its peers typically pre - release holiday results in January if they underperformed expectations ▪ If Norse's peers are reporting 15 - 20% EBITDA declines before Norse reports, or if the broader macro environment deteriorates, the Rating Agencies could pressure the Company to pre - release results – Macy's and Kohl's announce earnings in late February and early March ▪ It is likely the bidders' debt financing sources will expect to receive holiday results before closing (and this could require disclosure (Reg FD) or financing sources could leak the results if they are poor) ▪ We do not expect the Agencies to otherwise change their perspective on likely ratings outcome for Norse or otherwise take ratings action, subject to Q4 not underperforming by approximately > 15 - 20% EBITDA ▪ The next ratings action could happen upon successful closing of the Transaction ▪ In the scenario of Norse underperforming the Q4 EBITDA estimate it shares with the Agencies by approximately 15 - 20%, it is possible that the Agencies could change their view of Norse’s current or pro forma credit rating (pro forma for the $425MM of incremental debt at closing) – Agencies may also monitor any preview results on holiday season performance ▪ However, it is unclear whether the Agencies would only cite deterioration in operating performance as the catalyst for a rating action. The exact language used by the Agencies is critical because the downgrade must be the result of an event or circumstance "comprised of or arising as a result of, or in respect of" the Change of Control ▪ In all cases, we recommend that we are highly coordinated and thoughtful in the messaging with the Agencies before, during, and after RES / RAS 3 SUMMARY RATINGS CONSIDERATIONS
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW 4 POTENTIAL RATINGS DOWNGRADE RISKS Post - Close (~2 months) ▪ Ratings updates post - close Sign Close (~4 months) ▪ Q3 results (Late Nov.) ▪ Holiday results (late Jan. or early Mar.) ▪ Peer holiday results (late Jan. or late Feb. / early Mar.) Pre - Signing (~4 weeks) Key Events ▪ Negotiate terms ▪ Negotiate agreements ▪ RES / RAS ▪ Closing likely catalyst for updated ratings view ▪ 15 - 20% decline in projected EBITDA could cause re - assessment by Rating Agencies ▪ Other macro factors could also cause reassessment if known effect on industry ▪ Downgrade must be result of event or circumstance “comprised of or arising as a result of, or in respect of” the CoC ▪ RES / RES to provide clear initial result ▪ Downgrade feedback – Re - cut or abandon deal Downgrade Risks No risk Risk Allocation TBD Norse Co. No risk Buyer No Public Disclosure Post Public Disclosure
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW Oct. '24 to Jan. '25 Net Sales Down 50% (vs. Plan) Potential Cash Upsides Bid Group Cash Usage +$280 TD Agreement $620 Closing Cash @ FYE'24 +140 Remove SERP Funding (255) Cash Used for Purchase Price +120 February Close (vs. Jan.) (140) SERP Funding +50 March Close (vs. Jan.) (125) Transaction Fees $100 Cash Post - Closing Downside Cash Sensitivities ($69) Mgmt. Downside Case (vs. Plan) • Assumes illustrative ~10% miss on Oct - 24 through Jan - 25 net sales driven by holiday underperformance (400) 5 CLOSING CASH SENSITIVITIES Source: Norse management. Note: Dollars in millions.
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW Source: Management Long - Term Plan (August 2024) Notes: Dollars in millions. Based on latest received proposal. (1) Excludes potential proceeds from TD Bank agreement. YEAR - END CASH SENSITIVITY Sufficient cash to pay S/Hs under current proposal; insufficient cash for SERP and Transaction Fees 6 Sufficient cash for all uses Insufficient cash to pay S/Hs under current proposal (75%) (60%) (50%) (35%) (25%) (15%) 0% Illustrative Decline in Oct - 24 to Jan - 25 Net Sales vs. Plan $1,316 $2,105 $2,632 $3,421 $3,947 $4,474 $5,263 Implied Oct’24 – Jan’25 Net Sales ($MM) 0 120 220 320 420 520 620 Illustrative FY2024 Year End Cash Balance (1) (600) (500) (400) (300) (200) (100) - Cash Balance Downside vs. Mgmt. Plan
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW 7 Source: Norse management and company filings. Note: Dollars in millions, except per share amounts. (1) Diluted shares includes all outstanding options, unvested RSUs and unvested PSUs. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. REVERSE TERMINATION FEES AT VARIOUS PRICES PER SHARE 2.1% 2.2% 2.2% 2.3% 2.3% 2.4% 2.4% 2.5% $100 2.8% 2.9% 2.9% 3.0% 3.0% 3.1% 3.1% 3.2% $130 3.6% 3.7% 3.8% 3.8% 3.9% 4.0% 4.1% 4.2% $168 4.2% 4.4% 4.5% 4.6% 4.7% 4.8% 4.8% 5.0% $200 4.9% 5.1% 5.2% 5.3% 5.4% 5.5% 5.5% 5.7% $230 Reverse Termination Fee as % of Equity Value (1) Illustrative Price Per Share $23.00 $23.75 $24.00 $24.50 $25.00 $25.50 $25.75 $27.00 Reverse Termination Fee
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW Illustrative Price Per Share Prior Proposals Prior Counters $23.00 Metric $23.75 – +3% $24.00 +4% $24.50 +7% $25.00 +9% $25.50 +11% $25.75 +12% $27.00 +17% vs. Unaffected (3/18/24) $17.06 +35% +39% +41% +44% +47% +49% +51% +58% vs. Unaffected 30 - day VWAP $19.08 +21% +24% +26% +28% +31% +34% +35% +42% vs. Pre - Proposal (9/3/24) $22.82 +1% +4% +5% +7% +10% +12% +13% +18% vs. VWAP Since 9/3/24 $22.43 +3% +6% +7% +9% +11% +14% +15% +20% vs. Current (10/11/24) $22.35 +3% +6% +7% +10% +12% +14% +15% +21% Equity Value (1) $4,014 $4,147 $4,191 $4,279 $4,367 $4,456 $4,500 $4,721 Aggregate Value (2) $6,026 $6,158 $6,202 $6,290 $6,379 $6,467 $6,511 $6,733 Management LTP - 2024E $1,178 5.1x 5.2x 5.3x 5.3x 5.4x 5.5x 5.5x 5.7x Consensus - 2024E $1,144 5.3x 5.4x 5.4x 5.5x 5.6x 5.7x 5.7x 5.9x Internal Rate of Return (IRR) 13.9% 13.1% 12.8% 12.3% 11.8% 11.4% 11.1% 10.0% Multiple on Invested Capital (MOIC) 1.8x 1.8x 1.8x 1.7x 1.7x 1.7x 1.7x 1.6x Moody's - LTP 3.2x 3.2x 3.2x 3.3x 3.3x 3.3x 3.4x 3.4x Moody's - Consensus 3.2x 3.3x 3.3x 3.3x 3.4x 3.4x 3.4x 3.5x Memo: New Transaction Debt $325 $400 $425 $475 $525 $576 $601 $726 Bid Group Funding Incremental Capital vs. 10/9 Proposal ($100) ($25) – +$50 +$100 +$151 +$176 +$301 Premium / (Discount) Illustrative Bid Group Returns (4,5) AV / Adj. EBITDA (3) Illustrative Agency - Defined Leverage Ratios (2024E PF) (5) 8 ILLUSTRATIVE NORSE TAKE PRIVATE AT VARIOUS PRICES Source: Norse management, Moody’s, company filings, Capital IQ and FactSet as of October 11, 2024, except where otherwise noted. (6) Note: Dollars in millions, except per share amounts. (1) Diluted shares include all outstanding options, unvested RSUs and unvested PSUs. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. (2) Reflects current debt of $2,690 and cash of $679. (3) Adj. EBITDA figures unburdened by amortization of developer reimbursements. (4) Assumes illustrative 4.5x AV / LTM EBITDA exit at FY’28E year - end. (5) Illustratively assumes the management LTP, transaction close on February 1, 2025, 100% of excess cash flow post - close swept to common equity as dividends after drawn ABL balance is paid down, $100mm minimum cash and illustrative total transaction fees of $125mm, any incremental purchase price is funded by new transaction debt and ABL cost as outlined in the commitment letter draft. Illustrative ratings breakpoint at various prices not reflective of other potential qualitative factors Illustrative Breakpoint (6) Moody’s: 4.0x vs. $23.00
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW SUPPLEMENTARY MATERIALS 9
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW 10 NORSE’S HISTORICAL 4Q PERFORMANCE VS. EXPECTATIONS High Average Median Low 2023 2022 2021 2020 Fiscal 4Q 2018 2019 2017 2016 2015 2014 $MM, unless otherwise noted $4,420 $4,319 $4,486 $3,645 $4,538 $4,484 $4,702 $4,316 $4,194 $4,043 Actual Revenue $4,375 $4,330 $4,378 $3,589 $4,556 $4,588 $4,613 $4,362 $4,220 $4,003 Consensus +$108 +$9 ($11) ($104) +$45 ($11) +$108 +$56 ($18) ($104) +$89 ($46) ($26) +$40 Beat / Miss $ 2% 0% (0%) (2%) 1% (0%) 2% 2% (0%) (2%) 2% (1%) (1%) 1% Beat / Miss % $247 $187 $299 $30 $299 $333 $366 $424 $374 $465 Actual Adj. EBIT $229 $173 $259 $76 $351 $360 $375 $354 $415 $465 Consensus +$70 +$2 - - ($52) +$19 +$14 +$40 ($46) ($52) ($27) ($9) +$70 ($41) - - Beat / Miss $ 20% 2% -- % (15%) 8% 8% 15% (60%) (15%) (8%) (2%) 20% (10%) -- % Beat / Miss % Notes: 1. EBIT beat of 15% driven by CC revenue of $73MM and one - time items 2. Lows, Medians, Averages and Highs exclude fiscal 4Q 2020 COVID Impacted Period
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW 11 OVERVIEW OF CHANGE OF CONTROL TRIGGER AND FINANCING CONSIDERATIONS Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Refers to estimated agency - defined metrics; current reflects historical trailing twelve months at fiscal Q2 2024; projections based on Management Long - Term Plan as of August 2024 2. Pro forma assumes $24.00 offer price, transaction close on February 1, 2025, minimum cash balance of $100MM, management and Liverpool roll current ownership interests, and incremental $425MM of debt drawn via new ~$1.2Bn ABL at an assumed rate of SOFR + 200 bps 3. Debt / EBITDAR calculated as agency - defined debt divided by agency - defined EBITDAR 4. Agency debt adjustments: Moody’s includes operating leases, pensions (in current), and non - standard adjustments; S&P includes operating leases, pensions (in current), and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 5. Agency EBITDAR adjustments: Moody’s includes operating lease expense, pensions (in current), and unusual items; S&P includes operating lease expense, pensions (in current), stock - based compensation, and other; Fitch includes operating lease expense and other; excludes adjustment for impairments given Moody's worksheet exclusion of similar adjustment for late st fiscal year (related report dated April 15, 2024) Illustrative Breakpt. PF 2024E (2) Est. LTM Q2’24 (1) Leverage Ratio (1)(3)(4)(5) Illustrative Breakpt. PF 2024E (2) Est. LTM Q2’24 (1) Leverage Ratio (1)(3)(4)(5) Illustrative Breakpt. PF 2024E (2) Est. LTM Q2’24 (1) Leverage Ratio (1)(3)(4)(5) 4.0x 4.0x 3.9x Debt / EBITDAR 3.0x 3.2x 2.7x Net Debt / EBITDAR 4.0x 3.2x 3.2x Debt / EBITDAR Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) ▪ Additional quantitative and qualitative factors will be evaluated by the agencies during the ratings assessment process, including market characteristics, the Bid Group’s go - forward governance and capital allocation policies, and specific terms of the new ABL facility – The replacement of the current revolving credit facility with an upsized ABL may cause a divergence between the bond instrument ratings and corporate credit ratings ▪ The Bid Group has committed to an approach that preserves the ability to roll over Norse’s Senior Notes, including maintaining ample liquidity and target leverage ratios ▪ Norse’s Senior Notes totaling $2.3Bn (all debt with exception of Debentures due 2028) contain change of control provisions for bondholders, comprising of: 1. Change of control and 2. Subsequent downgrade to the bond rating by all three agencies specifically in connection with the change of control transaction ▪ Therefore, the ratings assessment concurrent with the transaction announcement will be critical to the Company’s ability to roll over its current capital structure ▪ The Bid Group's current offer assumes the rollover of the existing capital structure, and the Bid Group will not make a proposal if the existing indebtedness had to be refinanced in connection with the transaction prior to closing ▪ The Bid Group’s current offer contemplates $425MM in additional debt drawn via new $1.2Bn ABL facility
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW 12 NORSE’S CURRENT RATINGS SCORECARD Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Reflects estimated agency metric as of historical trailing twelve months at fiscal Q2 2024 2. Agency debt adjustments: Moody’s includes operating leases, pensions, and non - standard adjustments; S&P includes operating leases, pensions, and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 3. Agency EBITDAR adjustments: Moody’s includes operating lease expense, pensions, and unusual items; S&P includes operating lea se expense, pensions, stock - based compensation, and other; Fitch includes operating lease expense and other Key Financial Metrics: – Debt / EBITDAR – RCF / Net Debt – EBIT / Interest Other Factors for Ratings Downgrade: – Liquidity maintenance – EBIT to interest expense sustained below 3.25x – Debt / EBITDAR sustained above 4.0x – Lack of improvement in op margins – Rack changes unsuccessful – More aggressive financial strategies Ratings Considerations $4.4Bn Moody’s Debt Estimated Current Agency Adjusted Ratios (1)(2)(3) $1.4Bn Moody’s EBITDAR 3.2x Moody’s Leverage Leverage Breakpoints Rating Illustrative Leverage Breakpoints Debt/EBITDAR <2.5x Baa3 Debt/EBITDAR <3.25x Ba1 Debt/EBITDAR <4.0x Ba2 Debt/EBITDAR <4.75x Ba3 Debt/EBITDAR <5.75x B1 Leverage Breakpoints Rating Debt/EBITDAR <2.5x BBB - Debt/EBITDAR <3.0x BB+ Debt/EBITDAR <4.0x BB Debt/EBITDAR <5.0x BB - Debt/EBITDAR <6.0x B+ Leverage Breakpoints Rating Debt/EBITDAR <3.0x BBB - Debt/EBITDAR <3.5x BB+ Debt/EBITDAR <4.0x BB Debt/EBITDAR <5.0x BB - Debt/EBITDAR <6.0x B+ Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) Key Financial Metrics: – Debt / EBITDAR – FFO / Debt Key Financial Metrics: – Debt / EBITDAR – FCF Margin Current Rating $3.8Bn S&P Debt $1.4Bn S&P EBITDAR 2.7x S&P Leverage $5.7Bn Fitch Debt $1.4Bn Fitch EBITDAR 3.9x Fitch Leverage Other Factors for Ratings Downgrade: – Maintaining Debt / EBITDAR above 3.0x on a sustained basis – Weaker than expected sales in full line and off - price segments – Adj. EBITDA margins remain below 10% – More aggressive financial policy Other Factors for Ratings Downgrade: – Reasonable cash flows for accelerated strategic investments – Sustained structural advantages across the retail space – EBITDA trending below $1.0Bn, which would yield EBITDAR leverage sustaining above 4.0x
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW 13 Source: Moody’s, S&P, Fitch and Refinitiv Eikon. Note: Fitch suspended its rating in June 2020 before reinstating a BBB - rating in March 2021. Change in Rating Change in Outlook S&P Moody’s Fitch BBB+ A - BB+ BBB - 2008 2010 2012 2014 2016 2018 2020 2022 2024 Apr - 09: BBB+ Stable Mar - 10: Positive Outlook Feb - 11: A - Stable Feb - 16: BBB+ Stable Aug - 16: Negative Outlook BBB - Stable Oct - 19: Mar - 20: Negative Outlook Sep - 20: BB+ Negative Mar - 21: Jan - 23: Stable Negative Outlook Outlook Baa1 Baa2 Baa3 Ba1 Ba2 Mar - 09: Baa2 Negative Jan - 10: Stable Outlook Feb - 11: Baa1 Stable Jun - 19: Negative Outlook Oct - 19: Baa2 Stable Apr - 20: Baa3 Negative Sep - 21: Ba1 Stable Apr - 23: Negative Outlook Apr - 24: Ba2 Stable A - BBB+ BBB - BB+ BB BBB Nov - 04: A - Mar - 15: BBB+ Mar - 20: BBB Mar - 21: BBB - Jan - 23: BB+ Apr - 24: BB Jan - 16: Negative Watch NORSE CREDIT RATINGS OVER TIME Last 15 years
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW 14 PROJECTED LEVERAGE Management Long - Term Plan + Offer Leverage of $425MM 4.0x 3.1x 2.7x BB - 5.0x BB 4.0x 4.0x 2024PF 2025 2026 3.2x 2.3x 1.9x 3.0x 2.8x BB 4.0x BB+ 2024PF 2025 2026 2.7x 2.0x 3.2x Ba3 4.8x Ba2 4.0x 3.2x 2024PF 2025 2026 Moody’s (Ba2 / Stable) S&P (BB+ / Negative) Fitch (BB / Stable) Agency - Defined Debt ($Bn) (5) Agency - Defined EBITDAR ($Bn) (6) Projected Leverage Ratio (1)(2)(3) $4.7 $5.2 $6.1 $3.2 $3.8 $4.7 $3.7 $4.2 $4.7 $1.7 $1.7 $1.5 $1.7 $1.6 $1.5 $1.7 $1.6 $1.4 Sources: Moody’s, S&P, Fitch Ratings Materials Notes: 1. Pro forma; assumes $24.00 offer price, transaction close on February 1, 2025, minimum cash balance of $100MM, excess cash use d to pay down debt, management and Liverpool roll current ownership interests and incremental $425MM of debt drawn via new ~$1.2Bn ABL at an assumed rate of SOFR + 200 bps; assumes paydown within first fiscal year after close 2. Projections based on Management Long - Term Plan as of August 2024 3. Agency ratings trigger ratios, per agency - defined total debt, net debt, and EBITDAR: Moody’s reflects total debt / EBITDAR, S&P reflects net debt / EBITDAR, and Fitch reflects total debt / EBITDAR 4. Reflects estimate of related agency metric as of historical trailing twelve months at fiscal Q2 2024; reflects cash paydown of April 2024 notes ($250MM) 5. Agency debt adjustments: Moody’s includes operating leases and non - standard adjustments; S&P includes operating leases and workers compensation/self insurance; Fitch includes operating leases (equivalent to capitalized lease expense at 8x) 6. Agency EBITDAR adjustments: Moody’s includes operating lease expense and unusual items; S&P includes operating lease expense, stock - based compensation, and other; Fitch includes operating lease expense and other Ratings Triggers Current (4)
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview. 15
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW LEGAL DISCLAIMER – MORGAN STANLEY We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. We have prepared this document and the analyses contained in it based, in part, on certain assumptions and information obtained by us from the recipient, its directors, officers, employees, agents, affiliates and/or from other sources. Our use of such assumptions and information does not imply that we have independently verified or necessarily agree with any of such assumptions or information, and we have assumed and relied upon the accuracy and completeness of such assumptions and information for purposes of this document. 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Exhibit (c)(xiv)
PRELIMINARY & CONFIDENTIAL PROJECT NORSE SPECIAL COMMITTEE UPDATE OCTOBER 18, 2024
PRELIMINARY & CONFIDENTIAL AGENDA 1 ▪ Trading Performance Update 2 ▪ Perspectives on Credit Ratings in Downside Scenarios 3 ▪ SERP Impact on Agency Leverage 2
PRELIMINARY & CONFIDENTIAL 3 SECTION 1 TRADING PERFORMANCE UPDATE
PRELIMINARY & CONFIDENTIAL 3.5x 3.4x 3.0x 4.0x 5.5x 5.3x 5.0x 3.5x 5.0x 5.0x 5.0x 4.5x – (1.3%) 5.0 10.0 +7.2% +5.2% 80 85 90 95 100 105 110 Kohl's Macy's Norse (0.0x) 0.1x 0.2x (0.8%) 3.6% 4.7% VWAP High Low $22.60 $24.46 $21.42 Share Price Performance and Trading Volume (1) Indexed to 100 Volume (MM) 1. Market data as of October 17, 2024 2. Percentages reflect Norse share price performance over subsequent trading day or over shown period 3. Holiday season retail sales include November and December per National Retail Federation definition 4 TRADING PERFORMANCE SINCE SEPTEMBER 3 AV / NTM EBITDA (1) Norse Volume (MM) Norse Source: Capital IQ, National Retail Federation Notes: Macy’s Kohl’s ▪ Sep 4: Offer Disclosure – (0.2%) ▪ Sep 17: Retail Sales – +0.1% ▪ Sep 18: FOMC – +1.6% ▪ Oct 1: Port Strike Start – (3.5%) ▪ Oct 4: Jobs Report & Port Strike End – +2.3% ▪ Oct 10: CPI – +0.1% ▪ Oct 15: NRF Holiday Report (3) : +5.1% Notable Events (2) Norse Share Price Performance (%) Trading Summary Norse Share Price ($) Sep 4 – Oct 17 Sector Multiple Expansion / (Contraction) Average Volume: 2.2MM
$17.06 $17.15 $18.43 $20.64 $21.07 $16.35 $21.47 $21.59 $19.52 Offer $24.25 “Bump” Adjustment Adjustment Adjustment Current Ex. 3 Days (Pre Q1 - Current) (4) Post Offer) Price Target Median (4)(5) H1’24 Cumulative Macy’s End of Takeover Leak Share Price Pre - Change in Analyst Share Price Perf Present Value of 1YR Average Unaffected Share Earnings Buyout Talks Share Price Macy's Rumor Price Targets (Post 13D – Current Analyst Multiple (2) Price (1) ILLUSTRATIVE “ADJUSTED UNAFFECTED” PRICE METHODOLOGIES P R E L I M I NA R (6 ) Y & CONFIDENTIAL 5 4.8x (3) 5.1x (3) 5.1x (3) 4.3x (3) 5.0x (3) 5.0x (3) 4.6x (3) 4.4x (3) 4.7x Implied AV / NTM EBITDA Q1’24 and Q2’24 earnings 3 - day share price reactions (6) Macy’s 1 - day share price reaction to terminated buyout talks applied to Norse current share price Current share price less the takeover leak 3 - day share price reaction Share price prior to Macy’s takeover rumor (12/8/23) % change of median price target from pre Q1 release to current (6) Share price performance from 3 days post initial 13D (3/18/24) to pre - offer (9/3/24) plus performance from 3 days post offer (9/6/24) to current (6) Present Value of Median 1 - year Analyst Price Target (4)(5) 1 - year average unaffected multiple Unaffected share price ( 3 / 18 / 24 ) Methodology +$1.26 (Q1) +$1.20 (Q2) (11.7%) ($2.99) - - +23.5% +13.8% (3/21 - 9/3) +7.2% (9/6 - 10/17) - - 4.4x NTM EBITDA - - Relevant Metric Illustrative “Adjusted Unaffected” Share Price ($) Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Share price improvement driven by lower current debt contribution to implied AV 3. Reflects net debt as of Q2 2024A, and all outstanding options, unvested RSUs and unvested PSUs 4. Current Analyst Price Targets as of October 17, 2024; Excludes price targets of brokers that have revised price targets based on transaction - related news (see appendix for list of brokers and price targets) 5. PV share price discounted using Morgan Stanley’s estimated cost of equity of ~14.0% as of October 17, 2024 6. Applied to Norse unaffected share price or multiple Morgan Stanley Centerview Source: Capital IQ as of October 17, 2024
PRELIMINARY & CONFIDENTIAL 6 ILLUSTRATIVE NORSE IMPLIED PREMIUMS 32% 30% 29% 28% 26% $19.00 28% 27% 26% 24% 23% $19.50 25% 24% 23% 21% 20% $20.00 22% 21% 20% 18% 17% $20.50 19% 18% 17% 15% 14% $21.00 Illustrative Acquisition Price $24.00 $24.25 $24.50 $24.75 $25.00 Reference Price
PRELIMINARY & CONFIDENTIAL Illustrative Price Per Share Prior Proposals Prior Counters $23.00 Metric $23.75 – +3% $24.00 +4% $24.25 +5% $24.50 +7% $24.75 +8% $25.00 +9% $25.75 +12% $27.00 +17% vs. Unaffected (3/18/24) $17.06 +35% +39% +41% +42% +44% +45% +47% +51% +58% vs. VWAP Since 9/4/24 $22.60 +2% +5% +6% +7% +8% +10% +11% +14% +19% vs. Current (10/17/24) $24.46 (6%) (3%) (2%) (1%) +0% +1% +2% +5% +10% Equity Value (1) $4,014 $4,147 $4,191 $4,235 $4,279 $4,323 $4,367 $4,500 $4,721 Aggregate Value (2) $6,026 $6,158 $6,202 $6,246 $6,290 $6,335 $6,379 $6,511 $6,733 Management LTP - 2024E $1,178 5.1x 5.2x 5.3x 5.3x 5.3x 5.4x 5.4x 5.5x 5.7x Consensus - 2024E $1,144 5.3x 5.4x 5.4x 5.5x 5.5x 5.5x 5.6x 5.7x 5.9x Internal Rate of Return (IRR) 13.9% 13.1% 12.8% 12.6% 12.3% 12.1% 11.8% 11.1% 10.0% Multiple on Invested Capital (MOIC) 1.8x 1.8x 1.8x 1.8x 1.7x 1.7x 1.7x 1.7x 1.6x Moody's - LTP 3.2x 3.2x 3.2x 3.2x 3.3x 3.3x 3.3x 3.4x 3.4x Moody's - Consensus 3.2x 3.3x 3.3x 3.3x 3.3x 3.4x 3.4x 3.4x 3.5x Memo: New Transaction Debt $325 $400 $425 $450 $475 $500 $525 $601 $726 Bid Group Funding Incremental Capital vs. 10/17 Proposal ($125) ($50) ($25) – +$25 +$50 +$75 +$151 +$276 Premium / (Discount) Illustrative Bid Group Returns (4,5) AV / Adj. EBITDA (3) Illustrative Agency - Defined Leverage Ratios (2024E PF) (5) 7 ILLUSTRATIVE NORSE TAKE PRIVATE AT VARIOUS PRICES Source: Norse management, Moody’s, company filings, Capital IQ and FactSet as of October 17, 2024, except where otherwise noted. (6) Note: Dollars in millions, except per share amounts. (1) Diluted shares include all outstanding options, unvested RSUs and unvested PSUs. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. (2) Reflects current debt of $2,690 and cash of $679. (3) Adj. EBITDA figures unburdened by amortization of developer reimbursements. (4) Assumes illustrative 4.5x AV / LTM EBITDA exit at FY’28E year - end. (5) Illustratively assumes the management LTP, transaction close on February 1, 2025, 100% of excess cash flow post - close swept to common equity as dividends after drawn ABL balance is paid down, $100mm minimum cash and illustrative total transaction fees of $125mm, any incremental purchase price is funded by new transaction debt and ABL cost as outlined in the commitment letter draft. Illustrative ratings breakpoint at various prices not reflective of other potential qualitative factors Illustrative Breakpoint (6) Moody’s: 4.0x vs. $23.00
PRELIMINARY & CONFIDENTIAL 8 SECTION 2 PERSPECTIVES ON CREDIT RATINGS IN DOWNSIDE SCENARIOS
PRELIMINARY & CONFIDENTIAL 9 SUMMARY PERSPECTIVES ▪ A significant decline in Adj. EBITDA over the holiday period could drive Norse's leverage ratio above Moody's breakpoint of 4.0x and increase the likelihood of a downgrade ▪ We have worked with the Company to understand the Adj. EBITDA sensitivity from net sales misses versus plan in the October 2024 to January 2025 holiday season – In the holiday season, the Company can weather up to a ~25% net sales miss versus plan (implying a ~55% Adj. EBITDA miss versus plan) while also preserving Moody’s leverage under 4.0x ▪ Looking forward into 2025, it appears that Norse can maintain <4.0x Moody’s leverage if: – Adj. EBITDA misses by up to ~45% from October 2024 through Q1 2025 or – Adj. EBITDA misses by up to ~30% from October 2024 through Q2 2025, assuming quarterly consensus forecasts in the new year reflect the base plan ▪ Norse has demonstrated a history of reporting sales and Adj. EBITDA largely in - line with consensus expectations in Q4 – Over the past 10 years, in Q4 Norse has performed within 2% and 5% of consensus revenue and Adj. EBITDA, respectively – The seasonally slower Q1 has demonstrated less certainty with Adj. EBITDA beating and missing consensus by 10%+ in 6 out of the last 10 years ▪ Even if leverage remains below the 4.0x breakpoint, a material Adj. EBITDA miss of ~15 - 20% vs. the projections provided during RES/RAS may cause Moody’s to reevaluate its opinion ▪ In addition to Norse’s financial performance, a sudden deterioration of Moody’s qualitative assessment of the industry environment and Norse’s competitive position may elevate the risk of a reassessment
PRELIMINARY & CONFIDENTIAL 10 FY2024 OCTOBER TO JANUARY NET SALES SENSITIVITY Sources: Management Long - Term Plan (August 2024); Moody’s Ratings Materials Notes: 1. Assumes D&A of $600MM per Management LTP (August 2024), inclusive of amortization of developer expenses; Held constant across cases 2. Moody’s EBITDAR adjustments include operating lease costs and pensions; Held constant across cases 3. Moody’s total debt adjustments include operating leases; Held constant across cases 4. Assumes pro forma debt at FY2024 is maintained; Assumes incremental $450MM of debt drawn via new ~$1.2Bn ABL Illustrative Miss in Oct - 24 to Jan - 25 Net Sales vs. Plan Implied FY2024 Net Sales ($Bn) Implied Oct - 24 to Jan - 25 Adj. EBITDA Miss vs. Plan Implied Moody’s Leverage at YE (x) (2)(3)(4) Implied FY2024 Adj. EBITDA ($Bn) (1) 0% $14.5 $1.2 3.2x 0% (15%) $13.7 $1.1 3.5x (23%) (25%) $13.2 $0.9 4.0x (55%) (35%) $12.7 $0.8 4.6x (86%) (50%) $11.9 $0.5 5.9x (134%) (60%) $11.4 $0.4 7.3x (166%) (75%) $10.6 $0.1 11.3x (214%) Exceeds Moody’s Downgrade Trigger of 4.0x to Ba2 Rating Exceeds ~15 - 20% Miss for Re - Assessment of Ratings
PRELIMINARY & CONFIDENTIAL Sources: Management Long - Term Plan (August 2024), Moody’s Ratings Materials, Capital IQ as of October 17, 2024 Notes: 1. Assumes D&A of $600MM per Management LTP (August 2024), inclusive of amortization of developer expenses; Held constant across cases 2. Q1 2025 and Q2 2025 LTM EBITDA proxied using corresponding quarterly consensus EBITDA figures plus relevant LTP FY24 EBITDA figures 3. Moody’s EBITDAR adjustments include operating lease costs and pensions; Held constant across cases 4. Moody’s total debt adjustments include operating leases; Held constant across cases 5. Assumes pro forma debt at FY2024E is maintained; Assumes incremental $450MM of debt drawn via new ~$1.2Bn ABL 11 ILLUSTRATIVE ADJ. EBITDA SENSITIVITY Q4 2024 – Q2 2025 FY2024E LTM Q1 2025E (2) LTM Q2 2025E (2) Illustrative Miss in Norse Adj. EBITDA vs. Plan / Consensus (1)(2) 0% Norse Adj. EBITDA ($Bn) (25%) Norse Adj. EBITDA ($Bn) (50%) Norse Adj. EBITDA ($Bn) Moody’s Leverage (x) (3)(4)(5) Moody’s Leverage (x) (3)(4)(5) Moody’s Leverage (x) (3)(4)(5) $1.2 3.2x $1.0 3.6x $0.9 3.9x $1.2 3.2x $1.0 3.6x $0.9 4.1x $1.1 3.2x $0.9 3.8x $0.7 4.8x Sensitizes Impact on Oct - Jan Figures Sensitizes Cumulative Impact on Oct - Jan and Q1 2025E Figures Sensitizes Cumulative Impact on Oct - Jan, Q1 2025E and Q2 2025E Figures Exceeds Moody’s Downgrade Trigger of 4.0x to Ba2 Rating (~45%) EBITDA Miss Moody’s Breakpoint (~30%) EBITDA Miss Moody’s Breakpoint
PRELIMINARY & CONFIDENTIAL High Average Median Low 2023 2022 2021 (2) 2020 Fiscal 4Q 2018 2019 2017 (1) 2016 2015 2014 $MM, unless otherwise noted $4,420 $4,319 $4,486 $3,645 $4,538 $4,484 $4,702 $4,316 $4,194 $4,043 Actual $4,375 $4,330 $4,378 $3,589 $4,556 $4,588 $4,613 $4,362 $4,220 $4,003 Consensus +$108 +$9 ($11) ($104) +$45 ($11) +$108 +$56 ($18) ($104) +$89 ($46) ($26) +$40 Beat / Miss $ 2% 0% (0%) (2%) 1% (0%) 2% 2% (0%) (2%) 2% (1%) (1%) 1% Beat / Miss % $403 $338 $437 $167 $520 $504 $553 $589 $526 $597 Actual $377 $311 $425 $255 $533 $535 $553 $513 $554 $602 Consensus +$76 +$7 +$0 ($31) +$26 +$27 +$12 ($88) ($13) ($31) +$0 +$76 ($28) ($5) Beat / Miss $ 15% 2% 0% (6%) 7% 9% 3% (34%) (2%) (6%) 0% 15% (5%) (1%) Beat / Miss % Revenue Adj. EBITDA NORSE HAS LARGELY PERFORMED IN - LINE WITH ANALYST EXPECTATIONS ON REVENUE AND EBITDA IN Q4 Source: Capital IQ Notes: 1. Adj. EBITDA beat of 5% driven by CC revenue and one - time items 2. Lows, Medians, Averages and Highs exclude 4Q 2020 COVID Impacted Period 12
PRELIMINARY & CONFIDENTIAL High Average Median Low 2024 2023 2022 2021 Fiscal 1Q (1) 2019 2020 2018 2017 2016 2015 $MM, unless otherwise noted $3,335 $3,181 $3,569 $3,009 $2,119 $3,443 $3,561 $3,354 $3,249 $3,215 Actual $3,211 $3,113 $3,264 $2,918 $2,302 $3,575 $3,464 $3,350 $3,286 $3,170 Consensus +$305 +$63 +$68 ($132) +$124 +$68 +$305 +$91 ($183) ($132) +$97 +$4 ($37) +$45 Beat / Miss $ 9% 2% 2% (4%) 4% 2% 9% 3% (8%) (4%) 3% 0% (1%) 1% Beat / Miss % $132 $177 $184 $77 ($520) $240 $322 $312 $261 $382 Actual $150 $161 $195 $87 ($38) $295 $289 $274 $312 $393 Consensus +$38 ($8) ($11) ($55) ($18) +$16 ($11) ($10) ($482) ($55) +$33 +$38 ($51) ($11) Beat / Miss $ 14% (4%) (5%) (19%) (12%) 10% (5%) (11%) NM (19%) 11% 14% (16%) (3%) Beat / Miss % Revenue Adj. EBITDA NORSE HAS LARGELY PERFORMED IN - LINE WITH ANALYST EXPECTATIONS ON REVENUE AND EBITDA IN Q1 Source: Capital IQ Note: 1. Lows, Medians, Averages and Highs exclude 1Q 2020 COVID Impacted Period 13
PRELIMINARY & CONFIDENTIAL 14 SECTION 3 SERP IMPACT ON AGENCY LEVERAGE
PRELIMINARY & CONFIDENTIAL ▪ Norse's Supplemental Executive Retirement Plan ("SERP") requires that the unfunded portion be funded upon a "change of control," but Norse and the Company could amend the SERP to eliminate this requirement and keep the SERP unfunded after closing ▪ The unfunded portion of SERP is a debt - like item for the rating agencies that may impact the leverage at close – At year - end FY2023, the unfunded status of the SERP was $168MM, and the amount that is proposed by the Bid Group to be funded in connection with the transaction is $140MM (1) – This plan is nonqualified and does not have a minimum funding requirement ▪ Both Moody’s and S&P treat the unfunded SERP balance as debt, increasing leverage by 0.10x in each agency’s most recent report: ▪ If the SERP is not funded at close, the unfunded SERP will continue to be a liability ▪ On the other hand, if the SERP is fully funded at close, we should expect leverage to improve modestly at Moody’s – The SERP funding would be leverage neutral at S&P assuming a corresponding decrease in opening cash ▪ If the Bid Group informs the agencies that the SERP will be fully funded, but the full funding requirement is eliminated before closing to provide sufficient cash to close, Moody's and S&P would continue to treat the unfunded portion as debt, and it could impact agency - leverage post - close ▪ If the full funding requirement is eliminated in connection with signing, the rating agencies could incorporate the increased leverage into their RES/RAS assessment Note: 1. Excludes the amounts required to be funded on behalf of Erik Nordstrom, Pete Nordstrom and Jamie Nordstrom who are willing to waive the funding requirement for their SERP benefits Fitch S&P Moody’s No Impact Increases by unfunded amount, net of effective tax rate Debt Increases by unfunded amount No Impact No Impact EBITDAR Increases by SERP interest cost No Impact +0.10x SERP Impact on Leverage in Most +0.10x Recent Agency Report 15 RATING AGENCY TREATMENT OF NORSE’S SERP
PRELIMINARY & CONFIDENTIAL 16 APPENDIX SUPPLEMENTARY MATERIALS
PRELIMINARY & CONFIDENTIAL PROPOSED TRANSACTION SUMMARY 17 Note: Proposal contemplates in - the - money options and RSUs that vest by assumed transaction close; unvested PSUs and RSUs of ~9MM to be replaced by revised compensation plan. The details of the revised compensation plan have not been provided by the Bid Group and may create a new balance sheet liability. Notes Reflecting Latest Proposal $MM $MM $MM $MM $MM Sources # • Estimate for FY2024 year - end $620 $620 $620 $620 $620 Company Cash on Balance Sheet 1 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,690 2,690 2,690 2,615 Company Existing Debt 2 • Likely funded through $1.2Bn ABL, with drawn balance paid off 1 year after transaction close • Commitment letter to be provided at signing 450 425 400 325 250 New Transaction Debt 3 • Current holdings (49.6MM shares) 1,209 1,196 1,184 1,146 1,141 Family Investor Equity Roll 4 • Direct loan from Liverpool to Family Group (carried on Liverpool Balance Sheet) 446 450 454 467 454 Family New Equity 5 • Current holdings (15.8MM shares) 382 378 374 362 362 Liverpool Equity Roll 6 • Likely funded through $1.2Bn Balance Sheet cash with debt covering potential shortfall 1,266 1,262 1,257 1,244 1,226 Liverpool New Equity 7 $7,063 $7,021 $6,980 $6,855 $6,669 Total Sources Notes Reflecting Latest Proposal $MM $MM $MM $MM $MM Uses # • Based on Q2 2024A basic shares outstanding (164.2MM) plus dilutive equity securities at assumed transaction close of ~0.6MM in - the - money options and ~0.5MM of vested RSUs at $24.25 / share $4,008 $3,966 $3,925 $3,800 $3,764 Company Equity Value 8 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,690 2,690 2,690 2,615 Existing Debt 9 • Unfunded balance ($168MM) to be funded into trust upon transaction close • Family Group to waive $28MM portion • Amending SERP for flexibility but plan to fund at close 140 140 140 140 140 SERP Funding 10 • Fully accounts for advisor fee estimates provided by Company advisors and financing fees required to consummate the transaction 125 125 125 125 50 Preliminary Transaction Fees 11 • Based on Family Group advisor estimates, with new $1.2Bn ABL facility intended to fund seasonal working capital and liquidity needs 100 100 100 100 100 Minimum Cash 12 $7,063 $7,021 $6,980 $6,855 $6,669 Total Uses $24.25 $24.00 $23.75 $23.00 $23.00 Memo: Price Per Share Original Initial Second Third Fourth Revision Revision Revision Revision
PRELIMINARY & CONFIDENTIAL Excluded Brokers with Revised Price Targets Based on Transaction - related News 18 Analyst Price Targets % Change Post Initial 13D Filing and Offer (3) Pre 1Q2024 Earnings (2) Broker - $38.50 $38.50 Morningstar - NA $24.00 KeyBanc +13.6% $25.00 $22.00 TD Cowen +10.0% $22.00 $20.00 Citi +10.0% $22.00 $20.00 BMO +26.3% $24.00 $19.00 Telsey +16.7% $21.00 $18.00 Goldman Sachs +17.6% $20.00 $17.00 Jefferies +11.8% $19.00 $17.00 Evercore +35.3% $23.00 $17.00 Gordon Haskett +17.6% $20.00 $17.00 JP Morgan +53.3% $23.00 $15.00 Barclays +33.3% $20.00 $15.00 Bank of America - NA $13.00 Morgan Stanley +8.3% $13.00 $12.00 UBS - NA NA William Blair - NA NA Guggenheim +23.5% $21.00 $17.00 Median (1) +18.0% $20.82 $17.64 (1) Mean $18.43 (5) $14.86 (4) Present Value Median (1) $18.27 (5) $15.42 (4) Present Value Mean (1) ANALYST PRICE TARGETS FROM Q1 TO POST OFFER Source: Wall Street Equity Research Note: 1. Morningstar, KeyBanc, Barclays and Morgan Stanley Price Target excluded from Median and Mean calculations 2. Represents price targets as of May 17, 2024 3. Represents price targets as of October 17, 2024 4. PV share price discounted using Morgan Stanley’s estimated cost of equity of 14.4% as of May 17, 2024 5. PV share price discounted using Morgan Stanley’s estimated cost of equity of 14.0% as of October 17, 2024 Metric used on “Illustrative Adjusted Unaffected Price” page
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PRELIMINARY & CONFIDENTIAL 20 LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit (c)(xv)
PRELIMINARY & CONFIDENTIAL PROJECT NORSE UPDATE NOVEMBER 16, 2024
PRELIMINARY & CONFIDENTIAL 2 AGENDA 1 Norse and Peers Trading Performance Update 2 Illustrative “Adjusted Unaffected” Price Methodologies 5 Review of Strategic Alternatives 3 Preliminary Valuation Considerations 4 RAS / RES Process Update
PRELIMINARY & CONFIDENTIAL Kohl's Macy's Norse (0.1x) 0.1x 0.0x (2.3%) 2.6% 0.1% 3.5x 3.4x 3.0x 5.0x 6.0x 5.5x 5.3x 5.0x 4.5x 4.0x 5.3x 4.9x 3.5x – 5.0 10.0 80 85 90 95 100 105 110 +0.2% (0.1%) (11.3%) Current (11/15/2024) Low High VWAP $22.87 $21.42 $24.67 $22.78 Sector Multiple Expansion / (Contraction) Share Price Performance and Trading Volume (1) Indexed to 100 Volume (MM) Source: Capital IQ, National Retail Federation Notes: 1. Market data as of November 15, 2024 2. Assumes FDSO of ~174.5MM (inclusive of ~164.2MM basic shares outstanding at Q2 2024 with full accelerated vesting of dilutive equity securities inclusive of ~0.7MM options, ~1.5MM PSUs, and ~8.1MM RSUs) per Norse management, for comparison across the shown historical period 3. Percentages reflect Norse share price performance over subsequent trading day or over shown period 4. Holiday season retail sales include November and December per National Retail Federation definition 3 TRADING PERFORMANCE SINCE SEPTEMBER 3 AV / NTM EBITDA (1)(2) Norse Volume (MM) Norse Macy’s Kohl’s Average Volume: 2.0MM ▪ Sep 4: Offer Disclosure – (0.2%) ▪ Sep 17: Retail Sales – +0.1% ▪ Sep 18: FOMC – +1.6% ▪ Oct 1: Port Strike Start – (3.5%) ▪ Oct 4: Jobs Report & Port Strike End – +2.3% ▪ Oct 10: CPI – +0.1% ▪ Oct 15: NRF Holiday Report (4) – +5.1% ▪ Oct 17: Retail Sales – +0.9% ▪ Oct 30: GDP – (1.1%) ▪ Nov 6: Election – (0.7%) ▪ Nov 7: FOMC – +1.5% ▪ Nov 13: CPI – 0.0% ▪ Nov 15: Retail Sales – (0.7%) Notable Events (3) Norse Share Price Performance (%) Trading Summary Norse Share Price ($) Sep 4 – Nov 15
$17.06 $17.15 $18.36 $21.07 $16.35 $19.88 $20.19 $19.45 $19.52 Offer $24.25 “Bump” Adjustment Adjustment Adjustment Current Ex. 3 Days (Pre Q1 - Current) (4) Post Offer) Price Target Median (4)(5) H1’24 Cumulative Macy’s End of Takeover Leak Share Price Pre - Change in Analyst Share Price Perf Present Value of 1YR Average Unaffected Share Earnings Buyout Talks Share Price Macy's Rumor Price Targets (Post 13D – Current Analyst Multiple (2) Price (1) ILLUSTRATIVE “ADJUSTED UNAFFECTED” PRICE METHODOLOGIES P R E L I M I NA R (6 ) Y & CONFIDENTIAL 4 4.8x (3) 4.9x (3) 4.8x (3) 4.3x (3) 5.0x (3) 4.8x (3) 4.6x (3) 4.4x (3) 4.7x Implied AV / NTM EBITDA Q1’24 and Q2’24 earnings 3 - day share price reactions (6) Macy’s 1 - day share price reaction to terminated buyout talks applied to Norse current share price Current share price less the takeover leak 3 - day share price reaction Share price prior to Macy’s takeover rumor (12/8/23) % change of median price target from pre Q1 release to current (6) Share price performance from 3 days post initial 13D (3/18/24) to pre - offer (9/3/24) plus performance from 3 days post offer (9/6/24) to current (6) Present Value of Median 1 - year Analyst Price Target (4)(5) 1 - year average unaffected multiple Unaffected share price ( 3 / 18 / 24 ) Methodology +$1.26 (Q1) +$1.20 (Q2) (11.7%) ($2.99) - - +23.5% +13.8% (3/21 - 9/3) +0.2% (9/6 - 11/11) - - 4.4x NTM EBITDA - - Relevant Metric Illustrative “Adjusted Unaffected” Share Price ($) Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Share price improvement driven by lower current debt contribution to implied AV 3. Reflects net debt as of Q2 2024A, and all outstanding options, unvested RSUs and unvested PSUs per Norse management 4. Current Analyst Price Targets as of November 15, 2024; Excludes price targets of brokers that have revised price targets based on transaction - related news (see appendix for list of brokers and price targets) 5. PV share price discounted using Morgan Stanley’s estimated cost of equity of Norse of ~14.4% as of November 15, 2024 6. Applied to Norse unaffected share price or multiple Morgan Stanley Centerview Source: Capital IQ as of November 15, 2024
PRELIMINARY & CONFIDENTIAL 28% 29% 30% 32% $19.00 24% 26% 27% 28% $19.50 21% 23% 24% 25% $20.00 18% 20% 21% 22% $20.50 15% 17% 18% 19% $21.00 Illustrative Acquisition Price $24.25 $24.50 $24.75 $25.00 Reference Price 5 ILLUSTRATIVE NORSE IMPLIED PREMIUMS
PRELIMINARY & CONFIDENTIAL Illustrative Price Per Share Prior Proposals Prior Counters $23.00 Metric $23.75 – +3% $24.00 +4% $24.25 +5% $24.50 +7% $24.75 +8% $25.00 +9% $25.75 +12% $27.00 +17% vs. Unaffected (3/18/24) $17.06 +35% +39% +41% +42% +44% vs. VWAP Since 9/4/24 $22.78 vs. Current (11/15/24) $22.87 +1% +4% +5% +6% +7% Equity Value (1) $4,014 $4,147 $4,191 $4,235 $4,279 Aggregate Value (2) $6,026 $6,158 $6,202 $6,246 $6,290 Management LTP $1,178 5.1x 5.2x 5.3x 5.3x 5.3x Consensus $1,144 5.3x 5.4x 5.4x 5.5x 5.5x Internal Rate of Return (IRR) 13.9% 13.1% 12.8% 12.6% 12.3% Multiple on Invested Capital (MOIC) 1.8x 1.8x 1.8x 1.8x 1.7x Moody's - LTP 3.2x 3.2x 3.2x 3.2x 3.3x Moody's - Consensus 3.2x 3.3x 3.3x 3.3x 3.3x $425 $450 $475 Bid Group Funding Memo: New Transaction Debt $325 $400 Incremental Capital vs. 10/17 Proposal ($125) ($50) ($25) – +$25 +45% +47% +51% +58% +1% +4% +5% +6% +8% +9% +10% +13% +19% +8% +9% +13% +18% $4,323 $4,367 $4,500 $4,721 $6,335 $6,379 $6,511 $6,733 5.4x 5.4x 5.5x 5.7x 5.5x 5.6x 5.7x 5.9x 12.1% 11.8% 11.1% 10.0% 1.7x 1.7x 1.7x 1.6x 3.3x 3.3x 3.4x 3.4x 3.4x 3.4x 3.4x 3.5x $500 $525 $601 $726 +$50 +$75 +$151 +$276 Premium / (Discount) Illustrative Bid Group Returns (4,5) AV / 2024E Adj. EBITDA (3) Illustrative Agency - Defined Leverage Ratios (2024E PF) (5) 6 ILLUSTRATIVE NORSE TAKE PRIVATE AT VARIOUS PRICES Source: Norse management, LTP, company filings, Moody’s, Capital IQ and FactSet as of November 15, 2024, except where otherwise noted. Note: Dollars in millions, except per share amounts. Management projections per Norse management (the “LTP”) approved for use by Centerview and Morgan Stanley. (1) Fully diluted shares outstanding include basic shares of ~164.2mm at Q2’24 as well as full accelerated vesting of dilutive equity securities including options, PSUs and RSUs per Norse management. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. Reflects current debt of $2,690 and cash of $679 per company filings. Adj. EBITDA figures unburdened by amortization of developer reimbursements. Assumes illustrative 4.5x AV / LTM EBITDA exit at FY’28E year - end. Illustratively assumes the LTP, transaction close on February 1, 2025, 100% of excess cash flow post - close swept to common equity as dividends after drawn ABL balance is paid down, $100mm minimum cash and illustrative total transaction fees of $125mm, any incremental purchase price is funded by new transaction debt and ABL cost as outlined in the commitment letter draft. Not reflective of potential credit for any pro forma cost savings. Illustrative ratings breakpoint at various prices not reflective of other potential qualitative factors (2) (3) (4) (5) (6) Illustrative Breakpoint (6) Moody’s: 4.0x vs. $23.00
PRELIMINARY & CONFIDENTIAL $ $ 5 5 $ $ 1 1 0 0 $ $ 1 1 5 5 $ $ 2 2 0 0 $ $ 2 2 5 5 $ $ 3 3 0 0 $ $ 4 4 0 0 $38.72 $ $ 3 3 5 5 $ $ 4 4 5 5 M M a a r r - - 2 2 3 3 M M a a r r - - 2 2 4 4 M M a a r r - - 2 2 5 5 M M a a r r - - 2 2 6 6 ILLUSTRATIVE FUTURE SHARE PRICE ANALYSIS $24 Illustrative Future Share Price Trajectory (LTP and Consensus Estimates) Source: Norse management, LTP, company filings, FactSet and Capital IQ as of November 15, 2024. Note: Future share prices represent future value and do not include value of dividends. Assumes current fully diluted share count of ~174.5mm; inclusive of ~164.2mm basic shares at Q2’24 with full accelerated 7 vesting of dilutive equity securities including ~0.7mm options, ~1.5mm PSUs and ~8.1mm RSUs per Norse management. Future fully diluted share count assumed to be diluted by forecasted stock - based compensation issuance per the LTP. Consensus free cash flow extrapolated based on LTP free cash flow conversion rate. Assumes cash roll - forward beginning with current Q2’24 cash of $679mm. (1) Assumes peer - based cost of equity of 15.2%. Unaffected Price: $17.06 $19 LTP at 4.5x NTM EBITDA LTP at range of 4.0x – 5.0x NTM EBITDA Consensus at 4.5x NTM EBITDA Consensus at range of 4.0x – 5.0x NTM EBITDA Historical share price Represents illustrative future value of share price on a standalone basis – – M M a a r r - - 2 2 1 1 M M a a r r - - 2 2 2 2 Present Value of Future Share Price (1) LTP Consensus $21 $18 $22 $18 $21 $18 FYE’24E FYE’25E Centerview
PRELIMINARY & CONFIDENTIAL Methodology Metric ($MM) Implied Share Price Agg. Value ($MM) Low High Rounded to the nearest $0.25 Public Trading Comparables (1)(2) Consensus: AV / FY2024E EBITDA: 3.5x - 5.0x LTP Case: AV / FY2024E EBITDA: 3.5x - 5.0x 1,144 1,178 4,005 4,122 5,722 5,889 (1)(3) Discounted Equity Value Consensus: 3.5x - 5.0x FY2026E EBITDA LTP Case: 3.5x - 5.0x FY2026E EBITDA 1,164 1,340 4,150 4,674 5,591 6,290 (1)(4) Discounted Cash Flow LTP Case: 3.5x - 5.0x Exit Multiple; 8.8% - 9.9% WACC 5,329 7,075 Reference Only: 52 - Week Trading Range Analyst Price Targets (Undiscounted) 4,500 4,281 3,976 6,333 6,377 5,809 Analyst Price Targets (Discounted) (6) Leveraged Buyout LTP Case: 17.5% - 22.5% Target IRR; Exit Multiple = Entry 5,274 6,100 $11.50 $12.00 $12.25 $15.25 $19.00 $14.25 $13.00 $11.25 $19.75 $21.25 $22.25 $20.50 $24.50 $29.00 $24.75 $25.00 $21.75 $24.75 $0 $10 $20 $30 NORSE PRELIMINARY VALUATION ANALYSIS – MORGAN STANLEY Based on LTP and Consensus Estimates Sources: Capital IQ (unaffected date of March 18, 2024, current as of November 15, 2024); LTP as of August 2024 for years FY24 - 28; Norse management Notes: 1. Assumes $2,690MM of debt and $679MM of cash as of fiscal Q2 2024; assumes FDSO of ~174.5MM (inclusive of ~164.2MM basic shares outstanding at Q2 2024 with full accelerated vesting of dilutive equity securities inclusive of ~0.7MM options, ~1.5MM PSUs, and ~8.1MM RSUs) per Norse management 2. Range based on NTM trading multiples of Macy’s (3.7x) and Kohl’s (4.8x), as of unaffected date of March 18, 2024; 3. Represents present value of implied year - end 2025E share price based on discounted equity value analysis; share prices and cumulative dividends discounted at a ~14.4% cost of equity of Norse; sensitized on +0.75x / (0.75x) exit multiple 4. Implied share price based on DCF multiples method; WACC of 9.3%; EBITDA exit multiple of 4.25x sensitized on +0.75x / (0.75x) 5. Represents present value of median of analyst price targets as of November 15, 2024; discounted analyst price targets discounted at a ~14.4% cost of equity of Norse; Excludes price targets of brokers that have revised price targets based on transaction - related news as well as Morningstar’s $38.50 price target (see appendix for list of brokers and price targets) 6. Represents implied entry price to generate 17.5 - 22.5% IRR based on LTP; assumes offer diluted share count of ~165MM per Norse management (1)(5) Unaffected Share Price: $17.06 Bid Group Offer Price: $24.25 Consensus LTP 8 (1)(5)
PRELIMINARY & CONFIDENTIAL 9 Implied AV / '24E EBITDA Methodology Assumption Implied Share Price Value Implied AV 52 - Week Trading Range 52 - Wk High: 10/18/24 52 - Wk Low: 11/22/23 $4,482 – $6,320 3.8x – 5.4x Analyst Price Target Range (1) High: 11/05/24 Low: 08/27/24 $4,271 – $6,379 3.6x – 5.4x Premia Paid Analysis Premium to Unaffected: 25% - 40% $5,730 – $6,182 4.9x – 5.2x Public Trading Comparables 4.0x - 5.0x '24E EBITDA of $1,178mm $4,711 – $5,889 4.0x – 5.0x Discounted Cash Flow Analysis WACC: 11.0% - 13.0% PGR: 1.5% - 2.5% $5,338 – $7,035 4.5x – 6.0x $14.20 $13.00 $21.30 $15.55 $19.10 $24.65 $25.00 $23.90 $22.25 $28.70 NORSE PRELIMINARY VALUATION ANALYSIS – CENTERVIEW For Reference Only Note: Implied share prices rounded to the nearest $0.05. Illustrative DCF valuation date of August 3, 2024. Assumes mid - year discounting. Public Trading Comparables and DCF Analysis reflect LTP financials. Reflects current debt of $2,690 and cash of $679 as of Q2’24 per company filings. Fully diluted shares outstanding include basic shares of ~164.2mm at Q2’24 as well as full accelerated vesting of dilutive equity securities including options, PSUs and RSUs per Norse management. Assumes EBITDA is unburdened by amortization of developer reimbursements. (1) High reflects TD Cowen; Low reflects UBS. Unaffected Share Price: $17.06 Source: Norse management, LTP, company filings and FactSet as of November 15, 2024. Bid Group Proposal Price: $24.25
PRELIMINARY & CONFIDENTIAL 10 RATING AGENCY PRESENTATION PROCESS UPDATE ▪ Norse has assisted the Bid Group to refine credit model scenarios before convening with the agencies ▪ The Special Committee’s Advisors are seeking further clarification on the Bid Group’s preliminary draft of the ratings agency presentation received on 11/15 ▪ The Bid Group and the Special Committee’s advisors have aligned on presenting three scenarios to the rating agencies during the RAS / RES process, including various financing instruments and debt quantums ▪ Liverpool intends to make a loan to the buyer with a portion of their equity commitment, rather making than a loan to the Nordstrom family – The Special Committee's advisors are assessing the ratings impact of the loan ▪ The Bid Group intends to focus on prioritizing ratings maintenance and diligent capital allocation – The Bid Group intends to maintain dividend payment frequency (following a full repayment of transaction debt) with a smaller dividend payment amount than present levels, with additional shareholder distributions funded from free cash flow – The Bid Group intends to fund the SERP at closing, but may decide not to fund to augment closing liquidity and support Year 1 debt paydown ▪ Once the Special Committee confirms that the Bid Group can proceed with RAS / RES: – In - person NYC meetings with the agencies to be scheduled, which include the attendance of Bid Group principals and Norse representatives (but would not typically include representatives of the Special Committee or their financial advisors) – Ratings views to be requested within two weeks of RAS / RES meetings, with consideration to possibility of expediting turnaround to one week for additional fees
PRELIMINARY & CONFIDENTIAL 11 REMINDER OF POSSIBLE STRATEGIC ALTERNATIVES TO PROPOSED TRANSACTION 4 Monetize Real Estate 3 Enhanced Buyback 2 Dividend Enhancement 1 Continue to Execute LTP • Execute sale leaseback transactions of the Company’s owned real estate portfolio and distribute proceeds to shareholders • Use excess cash flow to establish robust buyback program • Payout excess year - end cash as a dividend each year • Execute Baseline LTP and consistently beat Street estimates Description x Unlock value to distribute to shareholders or reinvest in core business x Streamlined operations and strategic footprint x Execution does not require new counterparty x Enhanced capital return profile x Advantageous in current valuation context relative to historical trading levels x Evolves shareholder base towards long - term oriented investors x Sends long - term confidence signal on future free cash flow generation x Immediate cash realization for shareholders x LTP implies outperformance vs. Street Consensus x Solid foundation for execution with clean inventory position, Canada exit and optimized supply chain Benefits X Increase in rental payments will decrease EBITDA going forward X Challenging environment for real estate sales / elevated cap rate environment X Potential for tax leakage, depending on basis X Increases risk of ratings downgrade X Indirectly increases Family / Liverpool stake X Success varies based on timing of repurchases and valuation at execution X Potentially signals lack of investment opportunities X Investors typically do not seek dividend yield from discretionary consumer sector X Taxable event for shareholders X Potentially signals lack of investment opportunities X Investors likely to expect annual dividend increases going forward X Investors may not re - rate JWN’s multiple even with outperformance X Negative investor sentiment in the sector persists X Weak trading / execution at peers has created an unfavorable backdrop for JWN X JWN may be a target for future activists given its low multiple X Execution risk to LTP Considerations
PRELIMINARY & CONFIDENTIAL 12 REMINDER OF POSSIBLE STRATEGIC ALTERNATIVES TO PROPOSED TRANSACTION 7 Full Sale to Private Equity or Strategic Increase Liverpool Stake via Tender Offer 5 6 Separate Rack • Sell the business to a strategic acquiror or financial sponsor • Liverpool increases its stake via a Tender Offer • Separate Nordstrom Banner and Rack into two distinct businesses with separate management teams and shareholders Description x Immediate monetization for all shareholders x Provides current shareholders an opportunity to tender at a premium x Transitions shareholder base to more of a long - term orientation x Signal of validation from major existing shareholder and strategic investor x Potential value upside if Rack re - rates towards Off - Price peer multiples x Optimize management team and strategy around single distribution channel x Increases specialized operational expertise at each separated business Benefits X Limited universe of strategic acquirors X Limited financing available for sponsors X Likely requires refinancing existing debt X Recent trading levels and public Department Store peers may be valuation reference X Likely to reduce trading volume / liquidity of stock X Transaction may be perceived as a step towards a take - private or entrenchment of family / management X Liverpool's willingness to pay a premium for a larger minority stake X Facilitating increase in Liverpool stake could be seen as inconsistent with rationale for poison pill adoption (i.e., ensuring shareholders receive control premium for sale of control) X Viability of Rack as standalone public entity in light of current scale and recent performance X Potential multiple contraction for Nordstrom Banner X Ongoing dis - synergies and stranded costs from separation Considerations
PRELIMINARY & CONFIDENTIAL APPENDIX A SUPPLEMENTARY MATERIALS 13
PRELIMINARY & CONFIDENTIAL Key Takeaways For U.S. Investors 14 Deficit Debate • Republican sweep opens the door to substantial deficit expansion starting in 2026, as Republicans will pursue a wide array of tax cut extensions • Control of the House of Representatives will influence market expectations for UST yields, as a Republican majority would likely yield a higher deficit expansion Tariffs • Since tariffs can be executed through executive power, they are likely to precede any policies related to fiscal expansion that require deliberation • Unlikely to be limited to China imports as they were in Trump’s first term • Increased risk of tariffs on Europe and Mexico , but implementation may prove difficult - markets will be pricing in a variety of tariffs scenarios Strong Dollar Policy • Policies that Trump has advocated for likely will lead the USD higher, as it did in recent days • Driven primarily by increased tariff risk, geopolitical uncertainty, and expectations for a more expansionary fiscal agenda Corporate Credit Goldilocks at Risk • A Republican sweep widens the band of uncertainty around the US economic baseline, as well as trade policy toward Europe and Asia • Credit is likely to underperform equities as a wider range of outcomes is more of a risk than that it is an opportunity for credit investors M&A Implications • More favorable antitrust and regulatory environment likely to lead to a resurgence in mega deal activity in 2025 • Stronger capital markets will catalyze financial sponsors to lead a wave of M&A activity by deploying capital on the buyside and monetizing assets through M&A, IPO or secondary sales • Cross - border transactions should continue to accelerate , though potential tariff increases may temper this momentum in certain sectors • Corporate tax rate cuts likely to incentivize companies to pursue acquisitions • Shareholder activism to continue to increase for companies of all sizes with M&A as an increasing focus area given expected buyer momentum Source: Wall Street Research Market Reaction Has Been Overwhelmingly Positive, Driven by Improved M&A Backdrop, Interest Rate Environment And Preliminary Messaging On Tax Reform PRELIMINARY MARKET REACTION TO U.S. ELECTION RESULTS
PRELIMINARY & CONFIDENTIAL PROPOSED TRANSACTION SUMMARY 15 Notes Reflecting Latest Proposal $MM $MM $MM $MM $MM Sources # • Estimate for FY2024 year - end $620 $620 $620 $620 $620 Company Cash on Balance Sheet 1 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,690 2,690 2,690 2,615 Company Existing Debt 2 • Likely funded through $1.2Bn ABL, with drawn balance paid off 1 year after transaction close • Commitment letter to be provided at signing 450 425 400 325 250 New Transaction Debt 3 • Current holdings (49.6MM basic shares) 1,209 1,196 1,184 1,146 1,141 Family Investor Equity Roll 4 • Direct loan from Liverpool to Family Group (carried on Liverpool Balance Sheet) 446 450 454 467 454 Family New Equity 5 • Current holdings (15.8MM shares) 382 378 374 362 362 Liverpool Equity Roll 6 • Liverpool will obtain committed bridge loan financing at signing, may also seek to launch bond offering before closing 1,266 1,262 1,257 1,244 1,226 Liverpool New Equity 7 $7,063 $7,021 $6,980 $6,855 $6,669 Total Sources Notes Reflecting Latest Proposal $MM $MM $MM $MM $MM Uses # • Based on Q2 2024A basic shares outstanding (164.2MM) plus dilutive equity securities at assumed transaction close of ~0.6MM in - the - money options and ~0.5MM of vested RSUs at $24.25 / share $4,008 $3,966 $3,925 $3,800 $3,764 Company Equity Value 8 • From Q2 2024A Balance Sheet, inclusive of unamortized discounts and debt issuance costs 2,690 2,690 2,690 2,690 2,615 Existing Debt 9 • Unfunded balance ($168MM) to be funded into trust upon transaction close • Family Group to waive $28MM portion • Amending SERP for flexibility but Bid Group plans to fund at close 140 140 140 140 140 SERP Funding 10 • Fully accounts for advisor fee estimates provided by Company advisors and financing fees required to consummate the transaction 125 125 125 125 50 Preliminary Transaction Fees 11 • Based on Family Group advisor estimates, with new $1.2Bn ABL facility intended to fund seasonal working capital and liquidity needs 100 100 100 100 100 Minimum Cash 12 $7,063 $7,021 $6,980 $6,855 $6,669 Total Uses $24.25 $24.00 $23.75 $23.00 $23.00 Memo: Price Per Share Original Initial Second Third Fourth Revision Revision Revision Revision Note: Reflects latest proposal, which contemplates in - the - money options and RSUs that vest by assumed transaction close; unvested PSUs and RSUs of ~9MM to be converted into cash - based awards.
PRELIMINARY & CONFIDENTIAL 16 Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 35.8% (20.6%) 32.1% (24.3%) 59.7% 3.0% L1Y ∆ 51.8% (42.8%) (24.5%) (36.4%) 8.0% (36.5%) L2Y ∆ 20.7% (69.2%) (50.1%) 51.0% (31.2%) (59.9%) L3Y ∆ 29.8% (69.5%) (8.1%) (45.1%) (39.9%) (61.4%) L5Y ∆ 0 50 100 150 200 Nov - 19 May - 20 Nov - 20 May - 21 Nov - 21 May - 22 Nov - 22 May - 23 Nov - 23 May - 24 Nov - 24 (39.9%) (69.5%) (8.1%) SECTOR SHARE PRICE PERFORMANCE OVER TIME Source: Capital IQ as of November 15, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of November 15, 2024 3. Represents Macy’s as of unaffected date of December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL Share Price Performance Over Time Indexed to 100; Since November 15, 2019 250 (3) Macy's Unaffected Norse Unaffected (1) (4) Post Norse Unaffected Period To Current (2) May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; Share Price increased +5.1% day after earnings January 22, 2024: Macy’s announces it will not enter into an agreement with Arkhouse and Brigade March 18, 2024: Norse unaffected share price of $17.06 August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; Share Price increased +4.2% day after earnings July 3, 2024: Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal July 15, 2024 Macy’s terminates discussions with Arkhouse and Brigade December 8, 2023: Macy’s unaffected share price of $17.39 May - 24
PRELIMINARY & CONFIDENTIAL 17 Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 15.4x 4.9x 3.5x 3.7x 5.3x 4.7x Today 15.1x 5.2x 3.5x 3.1x 5.2x 4.4x L1Y Avg. 14.5x 5.2x 3.3x 3.2x 5.2x 4.4x L2Y Avg. 13.7x 4.9x 3.4x 3.8x 4.9x 5.0x L3Y Avg. 14.6x 5.0x 4.4x 4.5x 5.2x 5.2x L5Y Avg. 2.0x 0.0x 4.0x 8.0x 10.0x 12.0x Nov - 19 May - 20 Nov - 20 May - 21 Nov - 21 May - 22 Nov - 22 May - 23 May - 24 Nov - 24 5.3x 4.9x 3.5x 5.1x 6.0x 5.5x 4.2x SECTOR VALUATION MULTIPLES OVER TIME Source: Capital IQ as of November 15, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of November 15, 2024 3. Represents Macy’s as of unaffected date of December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL AV / NTM EBITDA Over Time Since November 15, 2019 Macy's Unaffected (3) Norse Unaffected (1) (4) Post Norse Unaffected Period To Current (2) December 8, 2023: Macy’s unaffected multiple of 3.7x November 17, 2022: Kohl’s announces they will not engage in transformative transactions; multiple of 5.6x January 21, 2022: Kohl’s unaffected multiple of 4.0x January 24, 2022: News of takeover offer; Kohl’s affected multiple of 5.1x May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; multiple of 5.1x March 18, 2024: Norse unaffected multiple of 4.7x August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; multiple of 5.5x July 3, 2024: Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal Nov - 23 May - 24
PRELIMINARY & CONFIDENTIAL 18 $17.06 $18.66 $18.74 $19.98 $21.03 $21.14 $22.78 – 15.0 20.0 10 15 20 25 30 3/15 4/1 4/15 4/29 5/13 5/28 6/11 6/26 7/11 7/25 8/8 8/22 9/6 9/20 10/4 11/1 +34.1% 10.0 5.0 (27.1%) (28.1%) NORSE’S SHARE PRICE SINCE UNAFFECTED DATE Source: Capital IQ Note: 1. Market data as November 15, 2024 Share Price Performance and Trading Volume Over Time (1) Since March 18, 2024 Share Price ($) April 18, 2024: Erik and Pete Nordstrom file Schedule 13D; Announce formation of Special Committee May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket. Beats on consensus revenue estimates, misses on EPS, and reaffirms guidance Average Volume: 2.6MM Norse Macy’s Kohl’s March 19, 2024: 35 Reuters report of Norse’s potential take - private Volume (MM) 3/18 March 18, 2024: Unaffected date May 2, 2024: Rumors of Sycamore Partners’ participation on potential take - private transaction 10/18 11/15 Norse Volume (MM) September 4, 2024: Offer Disclosure August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket. In - line with consensus revenue estimates and beats on consensus EBIT and EPS estimates. Raised low - ends of all guidance ranges
PRELIMINARY & CONFIDENTIAL Disclosed Valuation Details Date Price Target Rating Firm Name Discounted Cash Flow 9/4/2024 $38.50 Buy Morningstar ~12.0x FY2025 EPS 11/14/2024 $25.00 Hold TD Cowen 11.7x 2026E EPS 8/28/2024 $24.00 Hold Telsey ~12.0x FY2025 EPS 10/18/2024 $23.00 Hold Gordon Haskett 9.0x NTM P/E Multiple based on CY2026 EPS 9/5/2024 $23.00 Hold Barclays ~5.0x FY2024 AV / EBITDA 8/28/2024 $22.00 Hold Citi ~10x FY2025 EPS 8/27/2024 $22.00 Hold BMO 4.75x Q5 - Q8 AV / EBITDA Estimates 9/4/2024 $21.00 Hold Goldman Sachs 10.0x 2025E EPS 11/15/2024 $20.00 Hold Evercore 4.3x 2026E AV / EBITDA 9/5/2024 $20.00 Sell JP Morgan 10.0x FY2025 P/E 9/4/2024 $20.00 Hold Jefferies 5.0x FY2025 AV / EBITDA 9/5/2024 $20.00 Sell Bank of America ~0.3x FY2026E AV / Sales 11/14/2024 $13.00 Sell UBS 10.0x 2025E P/E and 5.9x 2025E EV/EBITDA 10/31/2024 NA Hold KeyBanc NA 10/28/2024 NA Hold Guggenheim NA 11/1/2024 NA Hold William Blair NA 9/5/2024 NA NA Morgan Stanley $18.36 (2) $21.00 Median (1) $18.28 (2) $20.91 Mean (1) CURRENT SHARE PRICE REPRESENTS A PREMIUM TO PRESENT VALUE OF MEDIAN PRICE TARGETS 19 Source: Wall Street Equity Research as of November 15, 2024 Notes: 1. Morningstar, KeyBanc, Barclays and Morgan Stanley Price Target excluded from median and mean calculations 2. Represents present value share price discounted using Morgan Stanley's estimated cost of equity of Norse of 14.4% as of November 15, 2014 Excluded Brokers with Revised Price Targets Based on Transaction - related News
PRELIMINARY & CONFIDENTIAL 20 LEGAL DISCLAIMER – MORGAN STANLEY We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. 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PRELIMINARY & CONFIDENTIAL 21 LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit (c)(xvi)
PRELIMINARY & CONFIDENTIAL | SUBJECT TO REVIEW Selected Commentary Δ vs. 10/17 $MM Δ vs. 10/17 $MM Δ vs. 10/17 $MM $MM Sources Reflects $280mm TD Agreement upfront payment received by the company following prior proposal +$280 $900 +$280 $900 +$280 $900 $620 Company Cash on Balance Sheet – 2,690 – 2,690 – 2,690 2,690 Company Existing Debt Any reductions in new transaction debt funded by incremental cash on balance sheet – 450 (50) 400 (200) 250 450 New Transaction Debt – 1,209 – 1,209 – 1,209 1,209 Family Investor Equity Roll – 382 – 382 – 382 382 Liverpool Equity Roll Updated scenarios no longer reflect direct loan from Liverpool to Family Group (446) – (446) – (446) – 446 Family New Equity Alternate structure with loan made from Liverpool to the Parent SPV (49.9% owned by Liverpool) +610 610 +660 660 +810 810 – Liverpool Loan to Parent SPV Decrease reflects additional amount contemplated for Parent SPV loan (444) 822 (444) 822 (444) 822 1,266 Liverpool New Equity $7,063 $7,063 $7,063 $7,063 Total Sources Reductions in total new equity funded by incremental cash on balance sheet (280) 1,432 (230) 1,482 (80) 1,632 1,712 Memo: Total New Equity RECONCILIATION OF SOURCES & USES SCENARIOS 2 Scenario 1 ($250mm ABL Draw) Scenario 2 ($400mm Term Loan B) Scenario 3 ($450mm ABL Draw) 10/17 Proposal Selected Commentary Δ vs. 10/17 $MM Δ vs. 10/17 $MM Δ vs. 10/17 $MM $MM Uses Unchanged $4,008 Company Equity Value 2,690 Existing Debt 140 SERP Funding 125 Preliminary Transaction Fees 100 Minimum Cash $7,063 Total Uses $24.25 Memo: Price Per Share Preliminary RES / RAS Scenarios
Exhibit (c)(xvii)
PRELIMINARY & CONFIDENTIAL PROJECT NORSE UPDATE NOVEMBER 20, 2024
PRELIMINARY & CONFIDENTIAL 2 AGENDA 1 Norse and Peers Trading Performance Update 2 Illustrative “Adjusted Unaffected” Price Methodologies 5 Review of Strategic Alternatives 3 Preliminary Valuation Considerations 4 RAS / RES Process Update
PRELIMINARY & CONFIDENTIAL Kohl's Macy's Norse (0.1x) 0.1x 0.0x (2.3%) 2.6% 0.1% 3.5x 3.4x 3.0x 5.0x 6.0x 5.5x 5.3x 5.0x 4.5x 4.0x 5.3x 4.9x 3.5x – 5.0 10.0 80 85 90 95 100 105 110 +0.2% (0.1%) (11.3%) Current (11/15/2024) Low High VWAP $22.87 $21.42 $24.67 $22.78 Sector Multiple Expansion / (Contraction) Share Price Performance and Trading Volume (1) Indexed to 100 Volume (MM) Source: Capital IQ, National Retail Federation Notes: 1. Market data as of November 15, 2024 2. Assumes FDSO of ~174.5MM (inclusive of ~164.2MM basic shares outstanding at Q2 2024 with full accelerated vesting of dilutive equity securities inclusive of ~0.7MM options, ~1.5MM PSUs, and ~8.1MM RSUs) per Norse management, for comparison across the shown historical period 3. Percentages reflect Norse share price performance over subsequent trading day or over shown period 4. Holiday season retail sales include November and December per National Retail Federation definition 3 TRADING PERFORMANCE SINCE SEPTEMBER 3 AV / NTM EBITDA (1)(2) Norse Volume (MM) Norse Macy’s Kohl’s Average Volume: 2.0MM ▪ Sep 4: Offer Disclosure – (0.2%) ▪ Sep 17: Retail Sales – +0.1% ▪ Sep 18: FOMC – +1.6% ▪ Oct 1: Port Strike Start – (3.5%) ▪ Oct 4: Jobs Report & Port Strike End – +2.3% ▪ Oct 10: CPI – +0.1% ▪ Oct 15: NRF Holiday Report (4) – +5.1% ▪ Oct 17: Retail Sales – +0.9% ▪ Oct 30: GDP – (1.1%) ▪ Nov 6: Election – (0.7%) ▪ Nov 7: FOMC – +1.5% ▪ Nov 13: CPI – 0.0% ▪ Nov 15: Retail Sales – (0.7%) Notable Events (3) Norse Share Price Performance (%) Trading Summary Norse Share Price ($) Sep 4 – Nov 15
$17.06 $17.15 $18.36 $21.07 $16.35 $19.88 $20.19 $19.45 $19.52 Offer $24.25 “Bump” Adjustment Adjustment Adjustment Current Ex. 3 Days (Pre Q1 - Current) (4) Post Offer) Price Target Median (4)(5) H1’24 Cumulative Macy’s End of Takeover Leak Share Price Pre - Change in Analyst Share Price Perf Present Value of 1YR Average Unaffected Share Earnings Buyout Talks Share Price Macy's Rumor Price Targets (Post 13D – Current Analyst Multiple (2) Price (1) ILLUSTRATIVE “ADJUSTED UNAFFECTED” PRICE METHODOLOGIES P R E L I M I NA R (6 ) Y & CONFIDENTIAL 4 4.8x (3) 4.9x (3) 4.8x (3) 4.3x (3) 5.0x (3) 4.8x (3) 4.6x (3) 4.4x (3) 4.7x Implied AV / NTM EBITDA Q1’24 and Q2’24 earnings 3 - day share price reactions (6) Macy’s 1 - day share price reaction to terminated buyout talks applied to Norse current share price Current share price less the takeover leak 3 - day share price reaction Share price prior to Macy’s takeover rumor (12/8/23) % change of median price target from pre Q1 release to current (6) Share price performance from 3 days post initial 13D (3/18/24) to pre - offer (9/3/24) plus performance from 3 days post offer (9/6/24) to current (6) Present Value of Median 1 - year Analyst Price Target (4)(5) 1 - year average unaffected multiple Unaffected share price ( 3 / 18 / 24 ) Methodology +$1.26 (Q1) +$1.20 (Q2) (11.7%) ($2.99) - - +23.5% +13.8% (3/21 - 9/3) +0.2% (9/6 - 11/11) - - 4.4x NTM EBITDA - - Relevant Metric Illustrative “Adjusted Unaffected” Share Price ($) Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Share price improvement driven by lower current debt contribution to implied AV 3. Reflects net debt as of Q2 2024A, and all outstanding options, unvested RSUs and unvested PSUs per Norse management 4. Current Analyst Price Targets as of November 15, 2024; Excludes price targets of brokers that have revised price targets based on transaction - related news (see appendix for list of brokers and price targets) 5. PV share price discounted using Morgan Stanley’s estimated cost of equity of Norse of ~14.4% as of November 15, 2024 6. Applied to Norse unaffected share price or multiple Morgan Stanley Centerview Source: Capital IQ as of November 15, 2024
PRELIMINARY & CONFIDENTIAL 28% 29% 30% 32% $19.00 24% 26% 27% 28% $19.50 21% 23% 24% 25% $20.00 18% 20% 21% 22% $20.50 15% 17% 18% 19% $21.00 Illustrative Acquisition Price $24.25 $24.50 $24.75 $25.00 Reference Price 5 ILLUSTRATIVE NORSE IMPLIED PREMIUMS
PRELIMINARY & CONFIDENTIAL Illustrative Price Per Share Prior Proposals Prior Counters $23.00 Metric $23.75 – +3% $24.00 +4% $24.25 +5% $24.50 +7% $24.75 +8% $25.00 +9% $25.75 +12% $27.00 +17% vs. Unaffected (3/18/24) $17.06 +35% +39% +41% +42% +44% vs. VWAP Since 9/4/24 $22.78 vs. Current (11/15/24) $22.87 +1% +4% +5% +6% +7% Equity Value (1) $4,014 $4,147 $4,191 $4,235 $4,279 Aggregate Value (2) $6,026 $6,158 $6,202 $6,246 $6,290 LTP $1,178 5.1x 5.2x 5.3x 5.3x 5.3x Consensus $1,144 5.3x 5.4x 5.4x 5.5x 5.5x Internal Rate of Return (IRR) 13.9% 13.1% 12.8% 12.6% 12.3% Multiple on Invested Capital (MOIC) 1.8x 1.8x 1.8x 1.8x 1.7x Moody's - LTP 3.2x 3.2x 3.2x 3.2x 3.3x Moody's - Consensus 3.2x 3.3x 3.3x 3.3x 3.3x $425 $450 $475 Bid Group Funding Memo: New Transaction Debt $325 $400 Incremental Capital vs. 10/17 Proposal ($125) ($50) ($25) – +$25 +45% +47% +51% +58% +1% +4% +5% +6% +8% +9% +10% +13% +19% +8% +9% +13% +18% $4,323 $4,367 $4,500 $4,721 $6,335 $6,379 $6,511 $6,733 5.4x 5.4x 5.5x 5.7x 5.5x 5.6x 5.7x 5.9x 12.1% 11.8% 11.1% 10.0% 1.7x 1.7x 1.7x 1.6x 3.3x 3.3x 3.4x 3.4x 3.4x 3.4x 3.4x 3.5x $500 $525 $601 $726 +$50 +$75 +$151 +$276 Premium / (Discount) Illustrative Bid Group Returns (4,5) AV / 2024E Adj. EBITDA (3) Illustrative Agency - Defined Leverage Ratios (2024E PF) (5) 6 ILLUSTRATIVE NORSE TAKE PRIVATE AT VARIOUS PRICES Source: Norse management, LTP, company filings, Moody’s, Capital IQ and FactSet as of November 15, 2024, except where otherwise noted. Note: Dollars in millions, except per share amounts. Management projections per Norse management (the “LTP”) approved for use by Centerview and Morgan Stanley. (1) Fully diluted shares outstanding include basic shares of ~164.2mm at Q2’24 as well as full accelerated vesting of dilutive equity securities including options, PSUs and RSUs per Norse management. Proposal implied share count contemplates only outstanding options and RSUs vesting prior to assumed transaction close on February 1, 2025. Reflects current debt of $2,690 and cash of $679 per company filings. Adj. EBITDA figures unburdened by amortization of developer reimbursements. Assumes illustrative 4.5x AV / LTM EBITDA exit at FY’28E year - end. Illustratively assumes the LTP, transaction close on February 1, 2025, 100% of excess cash flow post - close swept to common equity as dividends after drawn ABL balance is paid down, $100mm minimum cash and illustrative total transaction fees of $125mm, any incremental purchase price is funded by new transaction debt and ABL cost as outlined in the commitment letter draft. Not reflective of potential credit for any pro forma cost savings. Illustrative ratings breakpoint at various prices not reflective of other potential qualitative factors (2) (3) (4) (5) (6) Illustrative Breakpoint (6) Moody’s: 4.0x vs. $23.00
PRELIMINARY & CONFIDENTIAL $ $ 5 5 $ $ 1 1 0 0 $ $ 1 1 5 5 $ $ 2 2 0 0 $ $ 2 2 5 5 $ $ 3 3 0 0 $ $ 4 4 0 0 $38.72 $ $ 3 3 5 5 $ $ 4 4 5 5 M M a a r r - - 2 2 3 3 M M a a r r - - 2 2 4 4 M M a a r r - - 2 2 5 5 M M a a r r - - 2 2 6 6 ILLUSTRATIVE FUTURE SHARE PRICE ANALYSIS $24 Illustrative Future Share Price Trajectory (LTP and Consensus Estimates) Source: Norse management, LTP, company filings, FactSet and Capital IQ as of November 15, 2024. Note: Future share prices represent future value and do not include value of dividends. Assumes current fully diluted share count of ~174.5mm; inclusive of ~164.2mm basic shares at Q2’24 with full accelerated 7 vesting of dilutive equity securities including ~0.7mm options, ~1.5mm PSUs and ~8.1mm RSUs per Norse management. Future fully diluted share count assumed to be diluted by forecasted stock - based compensation issuance per the LTP. Consensus free cash flow extrapolated based on LTP free cash flow conversion rate. Assumes cash roll - forward beginning with current Q2’24 cash of $679mm. (1) Assumes peer - based cost of equity of 15.2%. Unaffected Price: $17.06 $19 LTP at 4.5x NTM EBITDA LTP at range of 4.0x – 5.0x NTM EBITDA Consensus at 4.5x NTM EBITDA Consensus at range of 4.0x – 5.0x NTM EBITDA Historical share price Represents illustrative future value of share price on a standalone basis – – M M a a r r - - 2 2 1 1 M M a a r r - - 2 2 2 2 Present Value of Future Share Price (1) LTP Consensus $21 $18 $22 $18 $21 $18 FYE’24E FYE’25E Centerview
PRELIMINARY & CONFIDENTIAL Methodology Metric ($MM) Implied Share Price Agg. Value ($MM) Low High Rounded to the nearest $0.25 Public Trading Comparables (1)(2) Consensus: AV / FY2024E EBITDA: 3.5x - 5.0x LTP Case: AV / FY2024E EBITDA: 3.5x - 5.0x 1,144 1,178 4,005 4,122 5,722 5,889 (1)(3) Discounted Equity Value Consensus: 3.5x - 5.0x FY2026E EBITDA LTP Case: 3.5x - 5.0x FY2026E EBITDA 1,164 1,340 4,150 4,674 5,591 6,290 (1)(4) Discounted Cash Flow LTP Case: 3.5x - 5.0x Exit Multiple; 8.8% - 9.9% WACC 5,329 7,075 Reference Only: 52 - Week Trading Range Analyst Price Targets (Undiscounted) 4,500 4,281 3,976 6,333 6,377 5,809 Analyst Price Targets (Discounted) (6) Leveraged Buyout LTP Case: 17.5% - 22.5% Target IRR; Exit Multiple = Entry 5,274 6,100 $11.50 $12.00 $12.25 $15.25 $19.00 $14.25 $13.00 $11.25 $19.75 $21.25 $22.25 $20.50 $24.50 $29.00 $24.75 $25.00 $21.75 $24.75 $0 $10 $20 $30 NORSE PRELIMINARY VALUATION ANALYSIS – MORGAN STANLEY Based on LTP and Consensus Estimates Sources: Capital IQ (unaffected date of March 18, 2024, current as of November 15, 2024); LTP as of August 2024 for years FY24 - 28; Norse management Notes: 1. Assumes $2,690MM of debt and $679MM of cash as of fiscal Q2 2024; assumes FDSO of ~174.5MM (inclusive of ~164.2MM basic shares outstanding at Q2 2024 with full accelerated vesting of dilutive equity securities inclusive of ~0.7MM options, ~1.5MM PSUs, and ~8.1MM RSUs) per Norse management 2. Range based on NTM trading multiples of Macy’s (3.7x) and Kohl’s (4.8x), as of unaffected date of March 18, 2024; 3. Represents present value of implied year - end 2025E share price based on discounted equity value analysis; share prices and cumulative dividends discounted at a ~14.4% cost of equity of Norse; sensitized on +0.75x / (0.75x) exit multiple 4. Implied share price based on DCF multiples method; WACC of 9.3%; EBITDA exit multiple of 4.25x sensitized on +0.75x / (0.75x) 5. Represents present value of median of analyst price targets as of November 15, 2024; discounted analyst price targets discounted at a ~14.4% cost of equity of Norse; Excludes price targets of brokers that have revised price targets based on transaction - related news as well as Morningstar’s $38.50 price target (see appendix for list of brokers and price targets) 6. Represents implied entry price to generate 17.5 - 22.5% IRR based on LTP; assumes offer diluted share count of ~165MM per Norse management (1)(5) Unaffected Share Price: $17.06 Bid Group Offer Price: $24.25 Consensus LTP 8 (1)(5)
PRELIMINARY & CONFIDENTIAL 9 Implied AV / '24E EBITDA Methodology Assumption Implied Share Price Value Implied AV 52 - Week Trading Range 52 - Wk High: 10/18/24 52 - Wk Low: 11/22/23 $4,482 – $6,320 3.8x – 5.4x Analyst Price Target Range (1) High: 11/05/24 Low: 08/27/24 $4,271 – $6,379 3.6x – 5.4x Premia Paid Analysis Premium to Unaffected: 25% - 40% $5,730 – $6,182 4.9x – 5.2x Public Trading Comparables 4.0x - 5.0x '24E EBITDA of $1,178mm $4,711 – $5,889 4.0x – 5.0x Discounted Cash Flow Analysis WACC: 11.0% - 13.0% PGR: 1.5% - 2.5% $5,338 – $7,035 4.5x – 6.0x $14.20 $13.00 $21.30 $15.55 $19.10 $24.65 $25.00 $23.90 $22.25 $28.70 NORSE PRELIMINARY VALUATION ANALYSIS – CENTERVIEW For Reference Only Note: Implied share prices rounded to the nearest $0.05. Illustrative DCF valuation date of August 3, 2024. Assumes mid - year discounting. Public Trading Comparables and DCF Analysis reflect LTP financials. Reflects current debt of $2,690 and cash of $679 as of Q2’24 per company filings. Fully diluted shares outstanding include basic shares of ~164.2mm at Q2’24 as well as full accelerated vesting of dilutive equity securities including options, PSUs and RSUs per Norse management. Assumes EBITDA is unburdened by amortization of developer reimbursements. (1) High reflects TD Cowen; Low reflects UBS. Unaffected Share Price: $17.06 Source: Norse management, LTP, company filings and FactSet as of November 15, 2024. Bid Group Proposal Price: $24.25
PRELIMINARY & CONFIDENTIAL 10 RATING AGENCY PRESENTATION PROCESS UPDATE ▪ Norse has assisted the Bid Group to refine credit model scenarios before convening with the agencies ▪ The Special Committee’s Advisors are seeking further clarification on the Bid Group’s preliminary draft of the ratings agency presentation received on 11/15 ▪ The Bid Group and the Special Committee’s advisors have aligned on presenting three scenarios to the rating agencies during the RAS / RES process, including various financing instruments and debt quantums ▪ Liverpool intends to make a loan to the buyer with a portion of their equity commitment, rather than making a loan to the Nordstrom family – The Special Committee's advisors are assessing the ratings impact of the loan ▪ The Bid Group intends to focus on prioritizing ratings maintenance and diligent capital allocation – The Bid Group intends to maintain dividend payment frequency (following a full repayment of transaction debt) with a smaller dividend payment amount than present levels, with additional shareholder distributions funded from free cash flow – The Bid Group intends to fund the SERP at closing, but may decide not to fund to augment closing liquidity and support Year 1 debt paydown ▪ Once the Special Committee confirms that the Bid Group can proceed with RAS / RES: – In - person NYC meetings with the agencies to be scheduled, which include the attendance of Bid Group principals and Norse representatives (but would not typically include representatives of the Special Committee or their financial advisors) – Ratings views to be requested within two weeks of RAS / RES meetings, with consideration to possibility of expediting turnaround to one week for additional fees
PRELIMINARY & CONFIDENTIAL 11 REMINDER OF POSSIBLE STRATEGIC ALTERNATIVES TO PROPOSED TRANSACTION 4 Monetize Real Estate 3 Enhanced Buyback 2 Dividend Enhancement 1 Continue to Execute LTP • Execute sale leaseback transactions of the Company’s owned real estate portfolio and distribute proceeds to shareholders • Use excess cash flow to establish robust buyback program • Payout excess year - end cash as a dividend each year • Execute Baseline LTP and consistently beat Street estimates Description x Unlock value to distribute to shareholders or reinvest in core business x Streamlined operations and strategic footprint x Execution does not require new counterparty x Enhanced capital return profile x Advantageous in current valuation context relative to historical trading levels x Evolves shareholder base towards long - term oriented investors x Sends long - term confidence signal on future free cash flow generation x Immediate cash realization for shareholders x LTP implies outperformance vs. Street Consensus x Solid foundation for execution with clean inventory position, Canada exit and optimized supply chain Benefits X Increase in rental payments will decrease EBITDA going forward X Challenging environment for real estate sales / elevated cap rate environment X Potential for tax leakage, depending on basis X Increases risk of ratings downgrade X Indirectly increases Family / Liverpool stake X Success varies based on timing of repurchases and valuation at execution X Potentially signals lack of investment opportunities X Investors typically do not seek dividend yield from discretionary consumer sector X Taxable event for shareholders X Potentially signals lack of investment opportunities X Investors likely to expect annual dividend increases going forward X Investors may not re - rate JWN’s multiple even with outperformance X Negative investor sentiment in the sector persists X Weak trading / execution at peers has created an unfavorable backdrop for JWN X JWN may be a target for future activists given its low multiple X Execution risk to LTP Considerations
PRELIMINARY & CONFIDENTIAL 12 REMINDER OF POSSIBLE STRATEGIC ALTERNATIVES TO PROPOSED TRANSACTION 7 Full Sale to Private Equity or Strategic Increase Liverpool Stake via Tender Offer 5 6 Separate Rack • Sell the business to a strategic acquiror or financial sponsor • Liverpool increases its stake via a Tender Offer • Separate Nordstrom Banner and Rack into two distinct businesses with separate management teams and shareholders Description x Immediate monetization for all shareholders x Provides current shareholders an opportunity to tender at a premium x Transitions shareholder base to more of a long - term orientation x Signal of validation from major existing shareholder and strategic investor x Potential value upside if Rack re - rates towards Off - Price peer multiples x Optimize management team and strategy around single distribution channel x Increases specialized operational expertise at each separated business Benefits X Limited universe of strategic acquirors X Limited financing available for sponsors X Likely requires refinancing existing debt X Recent trading levels and public Department Store peers may be valuation reference X Likely to reduce trading volume / liquidity of stock X Transaction may be perceived as a step towards a take - private or entrenchment of family / management X Liverpool's willingness to pay a premium for a larger minority stake X Facilitating increase in Liverpool stake could be seen as inconsistent with rationale for poison pill adoption (i.e., ensuring shareholders receive control premium for sale of control) X Viability of Rack as standalone public entity in light of current scale and recent performance X Potential multiple contraction for Nordstrom Banner X Ongoing dis - synergies and stranded costs from separation Considerations
PRELIMINARY & CONFIDENTIAL APPENDIX A SUPPLEMENTARY MATERIALS 13
PRELIMINARY & CONFIDENTIAL Key Takeaways For U.S. Investors 14 Deficit Debate • Republican sweep opens the door to substantial deficit expansion starting in 2026, as Republicans will pursue a wide array of tax cut extensions • Control of the House of Representatives will influence market expectations for UST yields, as a Republican majority would likely yield a higher deficit expansion Tariffs • Since tariffs can be executed through executive power, they are likely to precede any policies related to fiscal expansion that require deliberation • Unlikely to be limited to China imports as they were in Trump’s first term • Increased risk of tariffs on Europe and Mexico , but implementation may prove difficult - markets will be pricing in a variety of tariffs scenarios Strong Dollar Policy • Policies that Trump has advocated for likely will lead the USD higher, as it did in recent days • Driven primarily by increased tariff risk, geopolitical uncertainty, and expectations for a more expansionary fiscal agenda Corporate Credit Goldilocks at Risk • A Republican sweep widens the band of uncertainty around the US economic baseline, as well as trade policy toward Europe and Asia • Credit is likely to underperform equities as a wider range of outcomes is more of a risk than that it is an opportunity for credit investors M&A Implications • More favorable antitrust and regulatory environment likely to lead to a resurgence in mega deal activity in 2025 • Stronger capital markets will catalyze financial sponsors to lead a wave of M&A activity by deploying capital on the buyside and monetizing assets through M&A, IPO or secondary sales • Cross - border transactions should continue to accelerate , though potential tariff increases may temper this momentum in certain sectors • Corporate tax rate cuts likely to incentivize companies to pursue acquisitions • Shareholder activism to continue to increase for companies of all sizes with M&A as an increasing focus area given expected buyer momentum Source: Wall Street Research Market Reaction Has Been Overwhelmingly Positive, Driven by Improved M&A Backdrop, Interest Rate Environment And Preliminary Messaging On Tax Reform PRELIMINARY MARKET REACTION TO U.S. ELECTION RESULTS
PRELIMINARY & CONFIDENTIAL Selected Commentary o vs. 10/17 $MM o vs. 10/17 $MM o vs. 10/17 $MM $MM Sources Reflects $280mm TD Agreement upfront payment received by the company following prior proposal +$280 $900 +$280 $900 +$280 $900 $620 Company Cash on Balance Sheet – 2,690 – 2,690 – 2,690 2,690 Company Existing Debt Any reductions in new transaction debt funded by incremental cash on balance sheet – 450 (50) 400 (200) 250 450 New Transaction Debt – 1,209 – 1,209 – 1,209 1,209 Family Investor Equity Roll – 382 – 382 – 382 382 Liverpool Equity Roll Updated scenarios no longer reflect direct loan from Liverpool to Family Group (446) – (446) – (446) – 446 Family New Equity Alternate structure with loan made from Liverpool to the Parent SPV (49.9% owned by Liverpool) +610 610 +660 660 +810 810 – Liverpool Loan to Parent SPV Decrease reflects additional amount contemplated for Parent SPV loan (444) 822 (444) 822 (444) 822 1,266 Liverpool New Equity $7,063 $7,063 $7,063 $7,063 Total Sources Reductions in total new equity funded by incremental cash on balance sheet (280) 1,432 (230) 1,482 (80) 1,632 1,712 Memo: Total New Equity RECONCILIATION OF SOURCES & USES SCENARIOS Scenario 1 ($250mm ABL Draw) Scenario 2 ($400mm Term Loan B) Scenario 3 ($450mm ABL Draw) 10/17 Proposal Selected Commentary o vs. 10/17 $MM o vs. 10/17 $MM o vs. 10/17 $MM $MM Uses Unchanged $4,008 Company Equity Value 2,690 Existing Debt 140 SERP Funding 125 Preliminary Transaction Fees 100 Minimum Cash $7,063 Total Uses $24.25 Memo: Price Per Share Preliminary RES / RAS Scenarios 15
PRELIMINARY & CONFIDENTIAL 16 Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 35.8% (20.6%) 32.1% (24.3%) 59.7% 3.0% L1Y ∆ 51.8% (42.8%) (24.5%) (36.4%) 8.0% (36.5%) L2Y ∆ 20.7% (69.2%) (50.1%) 51.0% (31.2%) (59.9%) L3Y ∆ 29.8% (69.5%) (8.1%) (45.1%) (39.9%) (61.4%) L5Y ∆ 0 50 100 150 200 Nov - 19 May - 20 Nov - 20 May - 21 Nov - 21 May - 22 Nov - 22 May - 23 Nov - 23 May - 24 Nov - 24 (39.9%) (69.5%) (8.1%) SECTOR SHARE PRICE PERFORMANCE OVER TIME Source: Capital IQ as of November 15, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of November 15, 2024 3. Represents Macy’s as of unaffected date of December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL Share Price Performance Over Time Indexed to 100; Since November 15, 2019 250 (3) Macy's Unaffected Norse Unaffected (1) (4) Post Norse Unaffected Period To Current (2) May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; Share Price increased +5.1% day after earnings January 22, 2024: Macy’s announces it will not enter into an agreement with Arkhouse and Brigade March 18, 2024: Norse unaffected share price of $17.06 August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; Share Price increased +4.2% day after earnings July 3, 2024: Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal July 15, 2024 Macy’s terminates discussions with Arkhouse and Brigade December 8, 2023: Macy’s unaffected share price of $17.39 May - 24
PRELIMINARY & CONFIDENTIAL 17 Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 15.4x 4.9x 3.5x 3.7x 5.3x 4.7x Today 15.1x 5.2x 3.5x 3.1x 5.2x 4.4x L1Y Avg. 14.5x 5.2x 3.3x 3.2x 5.2x 4.4x L2Y Avg. 13.7x 4.9x 3.4x 3.8x 4.9x 5.0x L3Y Avg. 14.6x 5.0x 4.4x 4.5x 5.2x 5.2x L5Y Avg. 2.0x 0.0x 4.0x 8.0x 10.0x 12.0x Nov - 19 May - 20 Nov - 20 May - 21 Nov - 21 May - 22 Nov - 22 May - 23 May - 24 Nov - 24 5.3x 4.9x 3.5x 5.1x 6.0x 5.5x 4.2x SECTOR VALUATION MULTIPLES OVER TIME Source: Capital IQ as of November 15, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of November 15, 2024 3. Represents Macy’s as of unaffected date of December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL AV / NTM EBITDA Over Time Since November 15, 2019 Macy's Unaffected (3) Norse Unaffected (1) (4) Post Norse Unaffected Period To Current (2) December 8, 2023: Macy’s unaffected multiple of 3.7x November 17, 2022: Kohl’s announces they will not engage in transformative transactions; multiple of 5.6x January 21, 2022: Kohl’s unaffected multiple of 4.0x January 24, 2022: News of takeover offer; Kohl’s affected multiple of 5.1x May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; multiple of 5.1x March 18, 2024: Norse unaffected multiple of 4.7x August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; multiple of 5.5x July 3, 2024: Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal Nov - 23 May - 24
PRELIMINARY & CONFIDENTIAL 18 $17.06 $18.66 $18.74 $19.98 $21.03 $21.14 $22.78 – 15.0 20.0 10 15 20 25 30 3/15 4/1 4/15 4/29 5/13 5/28 6/11 6/26 7/11 7/25 8/8 8/22 9/6 9/20 10/4 11/1 +34.1% 10.0 5.0 (27.1%) (28.1%) NORSE’S SHARE PRICE SINCE UNAFFECTED DATE Source: Capital IQ Note: 1. Market data as November 15, 2024 Share Price Performance and Trading Volume Over Time (1) Since March 18, 2024 Share Price ($) April 18, 2024: Erik and Pete Nordstrom file Schedule 13D; Announce formation of Special Committee May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket. Beats on consensus revenue estimates, misses on EPS, and reaffirms guidance Average Volume: 2.6MM Norse Macy’s Kohl’s March 19, 2024: 35 Reuters report of Norse’s potential take - private Volume (MM) 3/18 March 18, 2024: Unaffected date May 2, 2024: Rumors of Sycamore Partners’ participation on potential take - private transaction 10/18 11/15 Norse Volume (MM) September 4, 2024: Offer Disclosure August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket. In - line with consensus revenue estimates and beats on consensus EBIT and EPS estimates. Raised low - ends of all guidance ranges
PRELIMINARY & CONFIDENTIAL Disclosed Valuation Details Date Price Target Rating Firm Name Discounted Cash Flow 9/4/2024 $38.50 Buy Morningstar ~12.0x FY2025 EPS 11/14/2024 $25.00 Hold TD Cowen 11.7x 2026E EPS 8/28/2024 $24.00 Hold Telsey ~12.0x FY2025 EPS 10/18/2024 $23.00 Hold Gordon Haskett 9.0x NTM P/E Multiple based on CY2026 EPS 9/5/2024 $23.00 Hold Barclays ~5.0x FY2024 AV / EBITDA 8/28/2024 $22.00 Hold Citi ~10x FY2025 EPS 8/27/2024 $22.00 Hold BMO 4.75x Q5 - Q8 AV / EBITDA Estimates 9/4/2024 $21.00 Hold Goldman Sachs 10.0x 2025E EPS 11/15/2024 $20.00 Hold Evercore 4.3x 2026E AV / EBITDA 9/5/2024 $20.00 Sell JP Morgan 10.0x FY2025 P/E 9/4/2024 $20.00 Hold Jefferies 5.0x FY2025 AV / EBITDA 9/5/2024 $20.00 Sell Bank of America ~0.3x FY2026E AV / Sales 11/14/2024 $13.00 Sell UBS 10.0x 2025E P/E and 5.9x 2025E EV/EBITDA 10/31/2024 NA Hold KeyBanc NA 10/28/2024 NA Hold Guggenheim NA 11/1/2024 NA Hold William Blair NA 9/5/2024 NA NA Morgan Stanley $18.36 (2) $21.00 Median (1) $18.28 (2) $20.91 Mean (1) CURRENT SHARE PRICE REPRESENTS A PREMIUM TO PRESENT VALUE OF MEDIAN PRICE TARGETS 19 Source: Wall Street Equity Research as of November 15, 2024 Notes: 1. Morningstar, KeyBanc, Barclays and Morgan Stanley Price Target excluded from median and mean calculations 2. Represents present value share price discounted using Morgan Stanley's estimated cost of equity of Norse of 14.4% as of November 15, 2014 Excluded Brokers with Revised Price Targets Based on Transaction - related News
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PRELIMINARY & CONFIDENTIAL 21 LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by Norse (“the Company”) and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at your direction Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit (c)(xviii)
PRELIMINARY & CONFIDENTIAL PROJECT NORSE PRESENTATION TO THE BOARD OF DIRECTORS DECEMBER 19, 2024
PRELIMINARY & CONFIDENTIAL ▪ Throughout 2023, at the request of the Norse Board of Directors, management worked with Morgan Stanley and Centerview Partners to independently evaluate value creation options due to persistent negative public market investor sentiment around the Department Store category and the industry’s long - term prospects ▪ On February 11 th , 2024, the Special Committee was formed to oversee the process to explore a potential take - private transaction following interest expressed by Erik and Pete Nordstrom in submitting a proposal ▪ On March 19 th , 2024, Reuters reported that the Nordstrom Family was seeking to take the Company private – Following the report, Norse’s stock experienced +9% 1 - day and +18% 3 - day price increases – Consequently, the pre - report price of $17.06 as of March 18 th has been referenced as the “unaffected” share price ▪ At the request of the Special Committee, Morgan Stanley and Centerview Partners engaged in discussions with 19 strategic and financial parties to gauge interest in exploring a transaction – 10 parties executed NDAs and 8 parties received additional due diligence information and met with company management – One party formally indicated interest in an acquisition and one party indicated interest in a sale - leaseback, however ultimately withdrew from the process ▪ On September 3 rd , the Special Committee received a non - binding written proposal for a potential acquisition of the Company, from a Bid Group comprised of members of the Nordstrom Family and Liverpool who collectively already own approximately 43% of Norse’s common stock – Offer to acquire the common stock of the Company for a cash purchase price of $23.00 per share – Offer contemplated pro forma ownership of ~50.1% by members of the Nordstrom Family and ~49.9% by Liverpool – After further discussions between September and November, the Bid Group raised its offer to $24.25 per share plus a special dividend of up to $0.25 per share and a “stub period” dividend based on $0.19 per share regular quarterly dividend at the discretion of the Board upon closing and depending on cash balances at closing o Offer reflects a ~42% premium to the unaffected price, excluding the potential dividends ▪ The Bid Group intends to rollover the Company’s current senior notes totaling $2.7 billion, $2.4 billion of which are redeemable upon a “double - trigger” consisting of (1) a change of control and (2) a ratings downgrade by all of Moody’s, S&P and Fitch – In December 2024, the Bid Group and Company Management held discussions with the rating agencies and received feedback that Moody’s and S&P would downgrade Norse’s Unsecured Debt while Fitch indicated it would hold ratings – The Bid Group is exploring paths to address ratings feedback 2 SITUATION UPDATE Sources: Capital IQ, Norse management
PRELIMINARY & CONFIDENTIAL 3 174.9 Diluted Shares Outstanding (2) $4,242 Total Equity Value 2,012 (+) Net Debt (3) $6,254 Total Aggregate Value Aggregate Value / Adj. EBITDA (4) : 5.5x $1,138 Management LTP - FY'24E (5) 4.9x $1,276 Management LTP - FY'25E (5) 5.3x $1,171 Consensus - FY'24E 5.3x $1,179 Consensus - FY'25E Proposal Metric $24.25 BID GROUP PROPOSAL: IMPLIED PREMIA AND MULTIPLES Multiples Premia Source: Norse management, company filings, FactSet and Capital IQ as of December 16, 2024. (3) (4) (5) Note: Dollars in millions, except per share amounts. Figures exclude one - time special dividend of up to $0.25 per share. (1) As of unaffected date of March 18, 2024, the last trading day prior to Reuters' report that the Nordstrom Family was seeking to take the Company private. (2) Fully diluted shares outstanding include basic shares of ~165.0mm as well as full accelerated vesting of dilutive equity securities including options, PSUs and RSUs as of December 16, 2024 per Norse management. Reflects debt of $2,689mm as of Q3’24 per Norse management and cash of $677mm ($397mm as of Q3’24 per Norse management pro forma for $280mm of cash received in Q4’24 in connection with the amended program agreement with TD). Adj. EBITDA figures unburdened by amortization of developer reimbursements. Norse projections per Norse management as approved for each of Centerview’s and Morgan Stanley’s use for its financial analysis and fairness opinion (the “LTP Case”). +42.1% $17.06 Unaffected Price (3/18/24) +27.1% $19.08 30 - Day VWAP ed (1) +29.7% $18.70 60 - Day VWAP ffe ct +85.4% $13.08 52 - Week Low (11/13/23) Un a +4.1% $23.30 52 - Week High (8/1/23) +3.9% $23.35 Current Price (12/16/24) Current +5.5% $22.98 30 - Day VWAP +5.8% $22.92 60 - Day VWAP +43.5% $16.90 52 - Week Low (1/3/24) (2.6%) $24.90 52 - Week High (11/25/24) Proposal Metric $24.25 Share Price Premium to:
PRELIMINARY & CONFIDENTIAL 4 ▪ Members of the Nordstrom family and related trusts (the “Family Group”) and El Puerto de Liverpool S.A.B. de C.V. (“Liverpool”) will form a new entity (“Parent”) to acquire Norse Purchaser ▪ Holders of Norse common stock (other than the Family Group and Liverpool) will receive $24.25 per share ▪ The Family Group and Liverpool (holding ~43% of outstanding shares) will roll their Norse shares in exchange for Parent common stock ▪ The Board is permitted to declare a special dividend of up to $0.25 per share, which will be contingent on the closing ▪ Unvested equity awards will be converted into cash - settled awards Consideration, Equity Awards and Special Dividend ▪ Shareholder approval by (1) two - thirds of outstanding shares and (2) majority of the shareholders other than the Family Group, Liverpool, and the Company’s directors and Section 16 officers ▪ Expiration or termination of HSR waiting period ▪ No order by US court prohibiting merger ▪ No “Below Investment Grade Rating Event” under the Company’s senior notes ▪ Each party’s obligations would also be subject to the accuracy of other party’s representations (subject to customary materiality exceptions) and material compliance with its covenants Conditions ▪ Failure to achieve shareholder approval ▪ US court issues order prohibiting the merger ▪ Occurrence of a Below Investment Grade Rating Event (subject to cure period) ▪ Other party materially breaches its representations or covenants (subject to cure periods), or if Parent refuses to close when required to do so ▪ Company only - Company accepts a superior proposal ▪ Parent only - Board changes its recommendation (only for 10 business days after change) Termination Rights ▪ Company will pay $85MM if deal is terminated because the Board changed its recommendation and $42.5MM if it enters into superior proposal or deal is voted down when there is a competing proposal that is subsequently entered into within 12 months and consummated ▪ Parent will pay $100MM if deal is terminated due to a Below Investment Grade Rating Event and $170MM if deal is terminated because of a Parent material breach or failure to close ▪ In the event of an intentional breach, the breaching party is liable for damages, subject to $300MM cap (inclusive of termination fee) ▪ Company can seek specific performance of Parent’s obligations, except that requiring Parent to close and Liverpool to fund under its equity commitment requires $450MM of debt financing proceeds and $410MM in Company cash (plus amount required to pay the special dividend) ▪ Liverpool and certain members of the Family Group are guaranteeing Parent’s liability for damages in the event of an intentional breach, reverse termination fee, and certain other obligations on a several basis Remedies ▪ Customary no - shop and “fiduciary out” provisions ▪ Customary interim operating covenants ▪ Covenants relating to each party’s interactions with the rating agencies and requiring the Family Group and Liverpool to be consistent with their RES/RAS presentations No - Shop and Other Covenants ▪ Parent will enter into debt commitment papers for an up to $1,200MM ABL and up to $[500]M term loan ▪ Liverpool will commit to contribute $1,712MM to Parent (which may be equity or a loan), and the Company can specifically enforce its commitment ▪ Liverpool will enter into debt commitment papers for a $1,500MM bridge facility to fund its equity commitment, and intends to launch a bond offering during the interim period Financing Structure ▪ Liverpool and the Family Group will enter into Rollover and Support Agreements that contain a voting commitment to vote in favor of the approval of the transaction and requirement to take, or refrain from taking, other actions related to the deal Voting Commitment KEY MERGER TERMS Illustrative Based on Latest Special Committee Proposal
PRELIMINARY & CONFIDENTIAL 5 (490bps) (124bps) +126bps - - - 3.9% 3.9% 3.6% 2.2% 1.7% (2.9%) 3.9% 3.9% 3.6% 3.4% 0.5% (7.8%) % Y/Y Growth - - - - - - - - (40) (78) 1,521 1,406 1,340 1,276 1,178 446 1,521 1,406 1,340 1,276 1,138 367 Adj. EBITDA (1) - - - - (18bps) (141bps) 9.2% 8.8% 8.7% 8.6% 8.1% 10.7% 9.2% 8.8% 8.7% 8.6% 7.9% 9.3% % Net Sales - - - - (17bps) (137bps) 8.9% 8.6% 8.5% 8.4% 7.9% 10.4% 8.9% 8.6% 8.5% 8.4% 7.7% 9.0% % Total Sales - - - - - - - - +4 - - (532) (530) (571) (602) (600) (145) (532) (530) (571) (603) (596) (145) ( - ) Total D&A - - - - - - - - (35) (78) 989 876 769 674 577 301 989 876 769 674 542 222 Adj. EBIT - - - - (20bps) (159bps) 6.0% 5.5% 5.0% 4.6% 4.0% 7.2% 6.0% 5.5% 5.0% 4.6% 3.8% 5.6% % Net Sales - - - - (19bps) (155bps) 5.8% 5.3% 4.9% 4.4% 3.9% 7.0% 5.8% 5.3% 4.9% 4.4% 3.7% 5.5% % Total Sales - - - - - - - - +9 +17 (267) (236) (208) (182) (153) (78) (267) (236) (208) (182) (144) (61) ( - ) Taxes - - - - - - - - (27) (61) 722 639 561 492 424 223 722 639 561 492 398 162 NOPAT - - - - - - - - - - - - 497 493 531 552 538 131 497 493 531 552 538 131 (+) D&A - - - - - - - - (4) (1) 35 37 40 50 62 14 35 37 40 50 58 14 (+) Amort. Of Dev. Reimb. - - - - - - - - +1 - - 202 196 191 187 185 47 202 196 191 187 186 47 (+) Right - of - use Asset Amort. - - - - - - - - (1) - - (288) (279) (272) (267) (264) (67) (288) (279) (272) (267) (266) (67) ( - ) Lease Liabilities - - - - - - - - +225 +189 (28) (49) (51) (104) (80) 182 (28) (49) (51) (104) 145 371 (+/ - ) Change in NWC +5 +5 +5 (8) (22) (37) (474) (457) (440) (422) (477) (142) (469) (452) (435) (430) (500) (179) ( - ) Capex +5 +5 +5 (8) +172 +92 665 580 560 488 387 387 671 584 566 481 559 479 Unlevered FCF December LTP August LTP Δ (December vs. August) Management Projections Management Projections Management Projections Quarters Annuals Quarters Annuals Quarters Annuals Q4 2024E 2024E 2025E 2026E 2027E 2028E Q4 2024E 2024E 2025E 2026E 2027E 2028E Q4 2024E 2024E 2025E 2026E 2027E 2028E Net Sales 3,967 14,320 14,792 15,319 15,910 16,525 4,177 14,498 14,792 15,319 15,910 16,525 (210) (178) - - - - -- - - % Y/Y Growth (7.6%) 0.7% 3.3% 3.6% 3.9% 3.9% (2.7%) 2.0% 2.0% 3.6% 3.9% 3.9% (489bps) (125bps) +127bps - - - Total Revenues 4,074 14,766 15,272 15,819 16,433 17,074 4,291 14,949 15,272 15,819 16,433 17,074 (217) (182) - - - - - - - - NORSE FINANCIAL SUMMARY – LTP COMPARISON In $MM, Unless Otherwise Stated Key Drivers of Change in Plan ▪ Reduced 2024E sales on lower GMV/sales signals as the Company entered the fourth fiscal quarter ▪ Reduced 2024E Adj. EBIT on lower sales and additional promotional mark - downs to support cleaner inventory position by YE ▪ Increased 2024E NWC mostly on TD proceeds received in November 2024 (not accounted for prior) ▪ Increased 2024E capex to reflect targeted $500MM in spend; increased 2025E capex driven by technology capex to support future efficiencies; reduced 2026E - 2028E capex due to slight decrease in capital need post evaluating cost investments Source: LTP Case Note: 1. EBITDA unburdened by amortization of developer reimbursements
PRELIMINARY & CONFIDENTIAL Methodology Metric ($MM) Implied Share Price Agg. Value ($MM) Low High Rounded to the nearest $0.25 Public Trading Comparables (1)(2) LTP Case: AV / FY2024E EBITDA: 3.5x - 5.0x LTP Case: AV / FY2025E EBITDA: 3.5x - 5.0x 1,138 1,276 3,982 4,467 5,689 6,382 Discounted Equity Value (3) LTP Case: 3.5x - 5.0x FY2026E EBITDA 1,340 4,985 6,689 Discounted Cash Flow (1) LTP Case: 3.5x - 5.0x Exit Multiple; 8.7% - 9.7% WACC 5,640 7,432 Reference Only: 52 - Week Trading Range Analyst Price Targets (Undiscounted) ( 4 ) Analyst Price Targets (Discounted) ( 4 )( 5 ) Consensus Trading Comparables : AV / FY 2024 E EBITDA : 3 . 5 x - 5 . 0 x ( 1 )( 2 ) Consensus Trading Comparables : AV / FY 2025 E EBITDA : 3 . 5 x - 5 . 0 x ( 1 )( 2 ) Consensus Discounted Equity Value : 3 . 5 x - 5 . 0 x FY 2026 E EBITDA ( 3 ) 4,985 4,547 4,241 4,099 4,127 4,635 6,383 6,558 5,990 5,855 5,895 6,121 1,171 1,179 1,169 Leveraged Buyout (6) LTP Case: 17.5% - 22.5% Target IRR; Exit Multiple Range of 3.5 - 5.0x 5,572 6,400 $11.25 $14.00 $17.00 $20.75 $17.00 $14.50 $12.75 $12.00 $12.00 $15.00 $21.50 $21.00 $25.00 $26.75 $31.00 $25.00 $26.00 $22.75 $22.00 $22.25 $23.50 $26.50 $0 $10 $20 $30 NORSE PRELIMINARY VALUATION ANALYSIS – MORGAN STANLEY Sources: Capital IQ (unaffected date of March 18, 2024, current as of December 16, 2024); LTP Case; Norse management Notes: 1. Reflects $2,689MM of debt as of fiscal Q3 2024 and $677MM of cash comprised of the Company’s cash balance of $397MM as of fiscal Q3 2024 plus $280MM of incremental cash received in connection with the TD program agreement amendment in November 2024 per Norse Management 2. Fully diluted share count of ~174.9MM provided by Norse Management and reflects ~165.0MM basic shares outstanding as of December 16, 2024 and accelerated vesting of outstanding dilutive securities, including ~0.7MM options, ~1.5MM PSUs, and ~7.6MM RSUs 3. Represents present value of implied year - end 2025E share price based on discounted equity value analysis; share prices and cumulative dividends discounted at a ~14.3% cost of equity of Norse 4. Based on median of analyst price targets as of December 16, 2024 excludes price targets of brokers that have revised price targets based on transaction - related news as well as Morningstar’s $38.50 price target (see appendix for list of brokers and price targets) 5. Reflects undiscounted analyst price targets discounted one year at Norse’s ~14.3% cost of equity 6. Implied entry price implied by 17.5 - 22.5% target IRR based on LTP Case; assumes full diluted share count of ~165.6MM, inclusive of ~165.0MM of basic shares as of December 16, 2024 per Norse Management plus vesting of ~0.6MM of options through February 2025; the remaining unvested RSUs and options are assumed to convert to cash compensation consistent with the Bid Group’s proposal on October 17, 2024 Unaffected Share Price: $17.06 Consensus LTP Case 6 Offer Price: $24.25 Bid Group Offer Price: $24.25 Excludes Potential Special Dividend of up to $0.25 and “Stub Period” Dividend Based on $0.19 Quarterly Dividend
PRELIMINARY & CONFIDENTIAL 7 Implied AV / '24E EBITDA (2) Methodology Assumption Implied Share Price Value Implied AV 52 - Week Trading Range 52 - Wk High: 11/25/24 52 - Wk Low: 01/03/24 $5,238 – $6,649 4.6x – 5.8x Analyst Price Target Range (1) High: 11/27/24 Low: 11/27/24 $4,818 – $6,843 4.2x – 6.0x Premia Paid Analysis Premium to Unaffected: 25% - 40% $6,017 – $6,469 5.3x – 5.7x 4.0x - 5.0x '24E EBITDA of $1,138mm $4,551 – $5,689 4.0x – 5.0x 4.0x - 5.0x '25E EBITDA of $1,276mm $5,106 – $6,382 4.5x – 5.6x Discounted Cash Flow Analysis (4) WACC: 11.00% - 13.00% PGR: 1.5% - 2.5% $5,960 – $7,696 5.2x – 6.8x Public Trading Comparables (2,3) $16.90 $14.50 $21.30 $14.60 $17.75 $21.00 $24.90 $26.00 $23.90 $21.05 $25.00 $30.80 NORSE PRELIMINARY VALUATION ANALYSIS – CENTERVIEW For Reference Only Note: Implied share prices rounded to the nearest $0.05. Fully diluted shares outstanding include basic shares of ~165.0mm as well as full accelerated vesting of dilutive equity securities including options, PSUs and RSUs as of December 16, 2024 per Norse management. Reflects debt of $2,689mm and cash of $397mm as of Q3’24 per Norse management, except where otherwise noted. EBITDA unburdened by amortization of developer reimbursements. (1) High reflects Telsey; Low reflects UBS. (2) Assumes LTP Case. (3) Implied Share Price Values assume debt of $2,689mm as of Q3’24 per Norse management and cash of $677mm ($397mm as of Q3’24 per Norse management pro forma for $280mm of cash received in Q4’24 in connection with the amended program agreement with TD). (4) DCF valuation date of November 2, 2024. Assumes mid - year discounting and LTP Case. (5) Excludes one - time special dividend of up to $0.25 per share and "stub period" dividend based on $0.19 quarterly dividend. Share Price: $17.06 Source: Norse management, LTP Case, company filings and FactSet as of December 16, 2024. Unaffected Bid Group Price Bid Group Disclosure: Proposal Price: $23.00 $24.25 (5)
PRELIMINARY & CONFIDENTIAL LTP Case (December 2024) 1,169 1,521 1,406 1,340 1,179 1,276 1,171 1,138 1,153 1,106 1,455 FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A FY2019A 8.9% 7.9% 7.7% 7.8% 8.4% 7.5% 8.5% 8.6% 7.8% 7.1% 9.4% 567 569 543 784 502 554 542 674 769 876 989 Margin FY2019A (% of Revenue): 5.1% FY2028E FY2027E FY2026E FY2025E FY2024E FY2023A FY2022A 5.8% 5.3% 3.5% 4.9% 3.8% 4.4% 3.7% 3.7% 3.9% 3.2% (1%) +19% +42% 14,693 15,524 15,530 14,885 14,766 15,173 15,272 15,494 15,819 16,433 17,074 (1%) +1% +2% 8 LTP Case vs. Consensus Historical Consensus Sources: Capital IQ as of December 16, 2024; LTP Case; Company Filings Note: 1. Adds back all depreciation and amortization including amortization of developer reimbursements Margin (% of Revenue): FY2023A FY2022A FY2019A (5.4%) 5.0% Growth: (2.1%) Adj. EBIT ($MM) Adj. EBITDA ($MM) (1) Total Revenue ($MM) NORSE’S LTP CASE VS. STREET PROJECTIONS Actual Performance Projections FY’24E – FY26E CAGR 2.0% 3.5% (0.1%) 8.5% (1.0%) 19.1%
PRELIMINARY & CONFIDENTIAL SUPPLEMENTARY MATERIALS 9
PRELIMINARY & CONFIDENTIAL 10 SUPPLEMENTARY MATERIALS A Morgan Stanley Supporting Valuation Analysis B Centerview Supporting Valuation Analysis C Investor Perspectives on Norse's Valuation Multiple
PRELIMINARY & CONFIDENTIAL APPENDIX A MORGAN STANLEY SUPPORTING VALUATION ANALYSIS 11
PRELIMINARY & CONFIDENTIAL 11.5x 8.3x 8.6x 7.5x 10.3x 6.3x 11.7x 11.0x 9.4x 8.8x 10.9x 6.3x 5.2x 4.8x 4.6x 4.1x 5.2x 3.9x 5.2x 5.4x 4.7x 4.4x 5.2x 3.9x 7.9% 7.7% 7.5% 8.1% 8.1% 8.6% 3.7% 3.7% 3.5% 4.0% 3.2% 4.7% 1.6% 1.9% 0.8% 1.5% (4.7%) 0.6% 1.1% 5.2% (1.2%) 5.4% (8.7%) (4.3%) COMPARABLE COMPANY ANALYSIS 12 Sources: Capital IQ as of December 16, 2024; LTP Case Notes: 1. Norse figures add back all depreciation and amortization including amortization of developer reimbursements 2. Norse Current reflects $2,689MM of debt as of fiscal Q3 2024 and $677MM of cash comprised of the Company’s cash balance of $397MM as of fiscal Q3 2024 plus $280MM of incremental cash received in connection with the TD program agreement amendment in November 2024 per Norse Management; Norse Current fully diluted share count of ~174.9MM provided by Norse Management and reflects ~165.0MM basic shares outstanding as of December 16, 2024 and accelerated vesting of outstanding dilutive securities, including ~0.7MM options, ~1.5MM PSUs, and ~7.6MM RSUs 3. Represents Norse as of unaffected date of March 18, 2024 4. Represents Macy’s as of unaffected date of December 8, 2023 CY2025E P / E (x) CY2024E P / E (x) CY2025E AV / EBITDA (x) (1)(2) CY2024E AV / EBITDA (x) (1)(2) CY2024E EBIT Margin (%) CY2024E EBITDA Margin (%) (1) CY’23A – CY’25E EBITDA CAGR (%) (1) CY’23A – CY’25E Revenue CAGR (%) Norse Current Consensus (4) Norse Current Management LTP Norse Unaffected Consensus (3) Norse Unaffected Management LTP (3) Morgan Stanley
PRELIMINARY & CONFIDENTIAL Disclosed Valuation Details Date Price Target Rating Firm Name Discounted Cash Flow 12/5/2024 $38.50 Buy Morningstar 12.3x 2026E EPS 11/27/2024 $26.00 Hold Telsey ~11.0x FY2025E EPS 11/27/2024 $25.00 Hold Gordon Haskett ~5x FY2024E AV / EBITDA 11/26/2024 $25.00 Hold Citi FY25 EPS of $2.05 and 12x P/E. 11/27/2024 $25.00 Hold TD Cowen 4.75x 2Y Forward EV/EBITDA 11/26/2024 $24.00 Hold Goldman Sachs 11.5x FY2025 P/E 11/27/2024 $23.00 Hold Jefferies 11.0x NTM P/E Based on CY2026 EPS 11/26/2024 $23.00 Hold Barclays 22.5x AV/EBITDA FY2025E 11/27/2024 $22.00 Sell Bank of America 10.0x 2026 EPS 11/26/2024 $22.00 Hold Evercore ~10.0x FY2025 EPS 11/29/2024 $22.00 Hold BMO ~4.3x 2026E EBITDA 11/26/2024 $21.00 Sell JP Morgan ~0.3x 2026E AV / Sales 11/27/2024 $14.50 Sell UBS NA 11/27/2024 NA Hold Guggenheim NA 12/9/2024 NA Hold William Blair 12.2x 2025E P/E & 6.8x 2025E AV / EBITDA 12/2/2024 NA Hold KeyBanc NA 11/27/2024 NA NA Morgan Stanley $20.12 (2) $23.00 Median (1) $19.81 (2) $22.65 Mean (1) ANALYST PRICE TARGETS 13 Source: Wall Street Equity Research as of December 16, 2024 Notes: 1. Morningstar, KeyBanc, Barclays, Jefferies and Morgan Stanley Price Target excluded from median and mean calculations 2. Represents present value share price discounted using Morgan Stanley's estimated cost of equity of Norse of 14.3% as of December 16, 2014 For Reference Only Excluded Brokers with Revised Price Targets Based on Transaction - related News Morgan Stanley
PRELIMINARY & CONFIDENTIAL $16.10 $20.05 $21.57 $25.80 $17.06 $27.04 $31.54 Current 2024E 2025E AV / NTM Adj. EBITDA of 5.00x Future Share Price (Incl. Dividends) (1) $MM / Share Present Value of Future Share Price (Incl. Dividends) (1) (2) $MM / Share 1. Calculated as NTM EBITDA multiplied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by fully diluted share count of ~174.9MM (provided by Norse Management) which reflects ~165.0MM basic shares outstanding as of December 16, 2024 and accelerated vesting of outstanding dilutive securities, including ~0.7MM options, ~1.5MM PSUs, and ~7.6MM RSUs; inclusive of future value of cumulative dividends per share discounted to present value 2. Discounted to October 31, 2024 valuation date at 14.3% cost of equity of Norse as of December 16, 2024 3. Market data as of unaffected date of March 18, 2024; Current share price as of December 16, 2024 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 1,340 5.0x 1,276 4.3x 1,340 4.3x 1,276 3.5x 1,340 3.5x 1,276 AV / NTM Adj. EBITDA Multiple (x) NTM Adj. EBITDA 6,701 6,381 5,695 5,424 4,690 4,467 Future Aggregate Value (1,442) (1,777) (1,442) (1,777) (1,442) (1,777) ( - ) Net Debt 5,259 4,604 4,253 3,647 3,248 2,690 Future Equity Value 175 175 175 175 175 175 FDSO (1) $30.06 $26.32 $24.32 $20.85 $18.57 $15.38 Future Share Price ($USD) $31.54 $27.04 $25.80 $21.57 $20.05 $16.10 Future Share Price Incl. Dividends 1.25 0.25 1.25 0.25 1.25 0.25 Periods 0.85 0.97 0.85 0.97 0.85 0.97 Discount Factor (2) $25.43 $25.46 $20.57 $20.16 $15.71 $14.87 Discounted Share Price ($USD) $26.77 $26.15 $21.91 $20.86 $17.05 $15.57 Discounted Share Price Incl. Dividends 40.3% 37.1% 14.8% 9.3% (10.6%) (18.4%) Premium / (Discount) to Unaffected 30D VWAP ($19.08) 56.9% 53.3% 28.4% 22.3% (0.1%) (8.7%) Premium / (Discount) to Unaffected ($17.06) (3) 14.6% 12.0% (6.2%) (10.7%) (27.0%) (33.3%) Premium / (Discount) to Current ($23.35) (3) Denotes range on FBF Sources: Capital IQ as of December 16, 2024; LTP Case Notes: ILLUSTRATIVE DISCOUNTED EQUITY VALUE | LTP CASE 3.50x NTM Adj. EBITDA 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x 5.00x NTM Adj. EBITDA 14 Morgan Stanley $15.57 $17.05 $17.06 $20.86 $21.91 $26.15 $26.77 Current 2024E 2025E
PRELIMINARY & CONFIDENTIAL 2025E 2024E 2025E 2024E 2025E 2024E 5.0x 1,169 5.0x 1,179 4.3x 1,169 4.3x 1,179 3.5x 1,169 3.5x 1,179 AV / NTM Adj. EBITDA Multiple (x) NTM Adj. EBITDA 5,845 5,895 4,968 5,011 4,092 4,127 Future Aggregate Value (1,170) (1,520) (1,170) (1,520) (1,170) (1,520) ( - ) Net Debt 4,675 4,375 3,798 3,491 2,921 2,607 Future Equity Value 175 175 175 175 175 175 FDSO (1) $26.73 $25.01 $21.71 $19.96 $16.70 $14.90 Future Share Price ($USD) $27.64 $25.73 $22.63 $20.68 $17.61 $15.62 Future Share Price Incl. Dividends 1.25 0.25 1.25 0.25 1.25 0.25 Periods 0.85 0.97 0.85 0.97 0.85 0.97 Discount Factor (2) $22.61 $24.19 $18.37 $19.30 $14.13 $14.41 Discounted Share Price ($USD) $23.47 $24.89 $19.23 $20.00 $14.99 $15.11 Discounted Share Price Incl. Dividends 23.0% 30.4% 0.8% 4.8% (21.5%) (20.8%) Premium / (Discount) to Unaffected 30D VWAP ($19.08) 37.5% 45.9% 12.7% 17.2% (12.2%) (11.4%) Premium / (Discount) to Unaffected ($17.06) (3) 0.5% 6.6% (17.7%) (14.4%) (35.8%) (35.3%) Premium / (Discount) to Current ($23.35) (3) AV / NTM Adj. EBITDA of 5.00x $15.62 $17.61 $20.68 $22.63 $17.06 $25.73 $27.64 Current 2024E 2025E $15.11 $14.99 $17.06 $20.00 $19.23 Present Value of Future Share Price (Incl. Dividends) (1)(2) $MM / Share $24.89 $23.47 Current 2024E 2025E Future Share Price (Incl. Dividends) (1) $MM / Share For Reference Only ILLUSTRATIVE DISCOUNTED EQUITY VALUE | CONSENSUS 3.50x NTM Adj. EBITDA 4.25x NTM Adj. EBITDA AV / NTM Adj. EBITDA of 3.50x AV / NTM Adj. EBITDA of 4.25x 5.00x NTM Adj. EBITDA 15 Morgan Stanley Denotes range on FBF Source: Capital IQ as of December 16, 2024; Capital IQ consensus estimates as of December 16, 2024 Notes: 1. Calculated as NTM EBITDA multiplied by illustrative Adj. EBITDA multiple subtracted by projected net debt divided by fully diluted share count of ~174.9MM (provided by Norse Management) which reflects ~165.0MM basic shares outstanding as of December 16, 2024 and accelerated vesting of outstanding dilutive securities, including ~0.7MM options, ~1.5MM PSUs, and ~7.6MM RSUs; inclusive of future value of cumulative dividends per share discounted to present value 2. Discounted to October 31, 2024 valuation date at 14.3% cost of equity of Norse as of December 16, 2024 3. Market data as of unaffected date of March 18, 2024; Current share price as of December 16, 2024
PRELIMINARY & CONFIDENTIAL 2028E 2027E 2026E 2025E Q4 2024E FYE February 3 17,074 17,074 16,433 15,819 15,272 4,074 Revenue 3.9% 3.9% 3.6% 3.4% % Growth 1,521 1,521 1,406 1,340 1,276 367 Adjusted EBITDA 8.9% 8.9% 8.6% 8.5% 8.4% 9.0% % Margin (469) (497) (493) (531) (552) (131) ( - ) D&A (35) (35) (37) (40) (50) (14) ( - ) Amort. Of Developer Reimbursements 1,017 989 876 769 674 222 EBIT 6% 6% 5% 5% 4% 5% % Margin (275) (267) (236) (208) (182) (61) ( - ) Tax Expense 27% 27% 27% 27% 27% 27% % Effective Tax Rate 469 497 493 531 552 131 (+) D&A 35 35 37 40 50 14 (+) Amort. Of Developer Reimbursements 202 202 196 191 187 47 (+) Right of Use Asset Amort. (288) (288) (279) (272) (267) (67) (+) (Increase) / Decrease in Lease Liabilities (15) (28) (49) (51) (104) 371 (+) (Increase) / Decrease in NWC (469) (469) (452) (435) (430) (179) ( - ) CapEx 676 671 584 566 481 479 Unlevered Free Cash Flow 44% 44% 42% 42% 38% 130% % Free Cash Flow Conversion (2) Terminal Implied Share Price – Increase in NWC calculated from a 2% revenue growth 5.00x 4.25x 3.50x Terminal EBITDA Exit Multiple into perpetuity 9.7% 9.2% 8.7% 9.7% 9.2% 8.7% 9.7% 9.2% 8.7% Discount Rate Present Value of: 2,328 2,349 2,370 2,328 2,349 2,370 2,328 2,349 2,370 Forecasted Free Cash Flow 5,121 5,226 5,335 4,352 4,442 4,535 3,584 3,658 3,734 Terminal Value 7,449 7,575 7,704 6,680 6,791 6,904 5,912 6,007 6,104 Implied Aggregate Value (2,292) (2,292) (2,292) (2,292) (2,292) (2,292) (2,292) (2,292) (2,292) ( - ) Net Debt (3) 5,156 5,283 5,412 4,388 4,499 4,612 3,620 3,715 3,812 Implied Equity Value 175 175 175 175 175 175 175 175 175 Fully Diluted Shares (4) $29.48 $30.20 $30.94 $25.09 $25.72 $26.37 $20.70 $21.24 $21.79 Implied Price Per Share ($USD) 0% (0%) (1%) (1%) (2%) (2%) (3%) (4%) (4%) Implied Perpetuity Growth Rate 26% 29% 33% 7% 10% 13% (11%) (9%) (7%) % Premium / (Discount) to Current (5) 73% 77% 81% 47% 51% 55% 21% 24% 28% % Premium / (Discount) to Unaffected (6) 6.5x 6.7x 6.8x 5.9x 6.0x 6.1x 5.2x 5.3x 5.4x Implied AV / 2024E EBITDA 5.8x 5.9x 6.0x 5.2x 5.3x 5.4x 4.6x 4.7x 4.8x Implied AV / 2025E EBITDA Key Assumptions • October 31, 2024 valuation date • Financials presented on January - ending fiscal year • 4.25 - year DCF using mid - year discounting convention • WACC range of ~8.7% - 9.7% • Illustrative effective tax rate in years FY24E - FY28E of 27% per Norse management • Terminal year assumptions (1) : – D&A equal to terminal year CapEx Unlevered Free Cash Flow Forecast (1) $MM, unless otherwise noted ILLUSTRATIVE DISCOUNTED CASH FLOW ANALYSIS | LTP CASE Source: LTP Case Notes: 1. Terminal LTM EBITDA assumes 3.9% terminal revenue growth; 8.9% terminal EBITDA margin 2. Free Cash Flow Conversion represents Unlevered Free Cash Flow divided by Adjusted EBITDA 3. Reflects $2,689MM of debt as of fiscal Q3 2024 and $397MM of cash as of fiscal Q3 2024 per Norse Management 4. Fully diluted share count of ~174.9MM provided by Norse Management and reflects ~165.0MM basic shares outstanding as of December 16, 2024 and accelerated vesting of outstanding dilutive securities, including ~0.7MM options, ~1.5MM PSUs, and ~7.6MM RSUs 5. Unaffected date as of March 18, 2024 6. Current market data as of December 16, 2024 Denotes range on FBF 16 Morgan Stanley
PRELIMINARY & CONFIDENTIAL Target Exit Multiple IRR 3.5x 3.9x 4.3x 4.6x 5.0x 17.5% $22.69 $23.67 $24.65 $25.63 $26.60 18.8% $22.40 $23.33 $24.27 $25.20 $26.14 20.0% $22.12 $23.01 $23.91 $24.80 $25.69 21.3% $21.85 $22.71 $23.56 $24.42 $25.27 22.5% $21.60 $22.42 $23.24 $24.06 $24.88 Total (%) Amount ($) Multiple (x) Uses Total (%) Amount ($) Multiple (x) Sources 58% $4,016 3.1x Company Equity Value 39% $2,690 2.1x Rollover of Existing Debt New Transaction Debt 0.4x $450 6% Cash on Balance Sheet 0.7x $830 12% Nordstrom Family Equity Rollover 0.9x $1,209 17% Liverpool Equity Rollover 0.3x $382 5% New Sponsor Equity (5) 1.1x $1,411 20% Total Sources 5.5x $6,972 100% 39% 2,690 2.1x Company Existing Debt 1% 100 0.1x Minimum Cash 2% 125 0.1x Estimated Transaction Fees Special Dividend 0.0x 41 1% Total Uses 5.5x $6,972 100% Key Assumptions • Offer price ($24.25 / share) (1) • Incremental $450MM in transaction debt (2) • Assumes incremental $450MM in transaction debt paid off in FY2025 (~83%) and FY2026 (17%) (3) • Assumes ~$66MM per year in Employee Incentive Plan payments starting FY2025 (3) • Assumes pro forma public company cost impact to SG&A of (~$3MM) in FY2025 and FY2026 and of ~$8MM in FY2027 and FY2028 (3) • Min cash of $100MM • Assumes all excess cash flows paid out to Bid Group as dividends • Assumes Family and Liverpool roll current equity stakes • Effective tax rate of 27% • 4.25 - year hold, with illustrative closing date of Q3 2024 • Entry Multiple based on NTM EBITDA of $1.3Bn (4) • NTM Exit EBITDA of $1.6Bn Illustrative Sources and Uses $MM, unless otherwise noted 17 ILLUSTRATIVE LEVERAGED BUYOUT ANALYSIS | LTP CASE Sources: Capital IQ as of December 16, 2024; LTP Case Notes: 1. Reflects latest Bid Group offer received on October 17, 2024 unless otherwise stated; assumes full diluted share count of ~165.6MM, inclusive of ~165.0MM of basic shares as of December 16, 2024 per Norse Management plus vesting of ~0.6MM of options through February 2025; the remaining unvested RSUs and options are assumed to convert to cash compensation consistent with the Bid Group’s proposal on October 17, 2024 2. Incremental $450MM assumed draw from ABL at an assumed rate of SOFR + 150 bps based on draft commitment letters 3. Based on December 2024 Norse Rating Agency Presentation assumptions; pro forma public company cost impact to SG&A in 2025 and 2026 includes $10MM of incremental credit card costs 4. Reflects $2,689MM of debt as of fiscal Q3 2024 and $397MM of cash as of fiscal Q3 2024 per Norse Management 5. Includes total new equity contributions from Family and Liverpool; includes Liverpool Loan to Parent SPV for new equity contribution; assumes incremental purchase equity on updated share count vs. October 17, 2024 offer funded via SPV loan Exit Multiple / Target IRR Implied $ per Share Entry = Exit for 17.5 - 22.5% IRR Denotes range on FBF A 20% Internal Rate of Return Implies an $24 Entry Price (~4.9x Entry Multiple) Morgan Stanley
PRELIMINARY & CONFIDENTIAL High Low Base Notes Assumption 4.4% 4.4% 4.4% Spot Rate on 10 - Year U.S. Treasury as of 12/16/2024 Risk Free Rate (R f ) 6.0% 6.0% 6.0% Morgan Stanley Estimated Market Risk Premium Market Risk Premium (MRP) 1.66 1.66 1.66 Predicted U.S. Local Beta per Barra Predicted Beta 1.0% (1.0%) +/ - 1.0% from Base Sensitivity Adjustment 15.3% 13.3% 14.3% Calculated Using the Capital Asset Pricing Model Cost of Equity (K E ) 4.9% 4.9% 4.9% Weighted Average Cost of Debt Pre - tax Cost of Debt (K D ) 27.0% 27.0% 27.0% Per Management Guidance Tax Rate (t) 3.5% 3.5% 3.5% Post - tax Cost of Debt (K D ) 47.4% 47.4% 47.4% Based on Current Capital Structure Debt / Total Capitalization 9.7% 8.7% 9.2% KE * E/(D+E) + KD * (1 - t) * D/(D+E) Weighted Average Cost of Capital (WACC) WACC Calculation Key Assumptions • Cost of Equity: Calculated using the Capital Asset Pricing Model • Risk Free Rate: Based on 10 - year U.S. Treasury as of current market date of December 16, 2024 • Predicted Beta: Predicted U.S. Local Beta per Barra as of unaffected date of March 18, 2024 • Cost of Debt: Norse’s current weighted average cost of debt • Tax Rate: Implied long - term tax rate of 27% as provided in LTP Case • Capital Structure: Norse’s current debt / total capitalization ratio (1) ILLUSTRATIVE WEIGHTED AVERAGE COST OF CAPITAL ANALYSIS Sources: Company filings, Capital IQ as of unaffected date of March 18, 2024 and current market date of December 16, 2024 for Risk Free Rate Note: 1. Debt as of October 31, 2024 provided by Norse management and market value of Norse equity as of unaffected date of March 18, 2024 18 Morgan Stanley
PRELIMINARY & CONFIDENTIAL APPENDIX B CENTERVIEW SUPPORTING VALUATION ANALYSIS 19
PRELIMINARY & CONFIDENTIAL 20 NORSE COMPARABLE COMPANIES ANALYSIS Source: Norse management, LTP Case, company filings, FactSet and Capital IQ as of December 16, 2024. Note: Dollars in millions except per share figures. Reflects fiscal years. (1) Norse EBITDA figures add back amortization of developer reimbursement. (2) EBIT and EBITDA reflect adjusted figures. (3) EBIT margin shown as % of total revenue. (4) Debt figures do not include operating leases, but include finance leases and LTM EBITDA does not add back rent. (5) Norse Current figures pro forma for $280mm of cash received in Q4’24 in connection with the amended program agreement with TD. (6) Reflects Norse share price, capitalization, consensus estimates and Management projections as of unaffected date of March 18, 2024. November 2023 LTP Case reviewed by the Board. Selected Department Store Peers Centerview Net Gross EBIT Margin (3) '23A - '25E CAGR AV / Adj. EBITDA (1) Aggregate Market % of 52 - Share Leverage (4) Leverage (4) 2025E 2024E EBIT (2) EBITDA (1,2) Revenue 2025E 2024E Value Cap Wk. High Price Company 1.4x 1.6x 4.6% 4.6% (15.2%) (9.5%) (2.1%) 3.9x 3.8x $7,339 $4,787 (22.4%) $16.72 Macy's 3.7x 3.9x 3.4% 3.2% (16.0%) (8.7%) (4.7%) 5.2x 5.2x 6,387 1,664 (51.3%) 14.31 Kohl's 2.6x 2.7x 4.0% 3.9% (15.6%) (9.1%) (3.4%) 4.5x 4.5x Peer Median (0.6x) 0.6x 9.1% 10.9% (19.6%) (19.2%) (2.2%) 8.6x 7.0x 6,193 6,781 (10.3%) $426.36 Memo: Dillard's 2.0x 2.3x 3.8% 3.7% 0.2% 1.1% 1.6% 5.2x 5.2x 6,095 4,083 (6.2%) $23.35 Current (5) Norse (Cons.) 2.0x 2.3x 4.4% 3.7% 9.0% 5.2% 1.9% 4.8x 5.4x 6,095 4,083 (6.2%) $23.35 Norse (LTP Case) Unaffected (6) 2.0x 2.3x 3.6% 3.5% (2.5%) (1.2%) 0.8% 4.6x 4.7x 5,202 2,891 (26.8%) $17.06 Norse (Cons.) 2.0x 2.3x 4.4% 3.9% 8.5% 5.4% 1.6% 4.1x 4.4x 5,202 2,891 (26.8%) $17.06 Norse (LTP Case)
PRELIMINARY & CONFIDENTIAL 21 DISCOUNTED CASH FLOW ANALYSIS Assumes LTP Case Source: LTP Case, Norse management and Wall Street research. Note: Dollars in millions, except per share amounts and where otherwise noted. Share prices rounded to nearest $0.10. Assumes valuation date and balance sheet information as of November 2, 2024. Reflects fiscal periods. Reflects debt of $2,689mm and cash of $397mm as of Q3’24 per Norse management. Fully diluted shares outstanding include basic shares of ~165.0mm as well as full accelerated vesting of dilutive equity securities including options, PSUs and RSUs as of December 16, 2024 per Norse management. (1) (2) (3) (4) LTP Case. Represents normalized depreciation & net working capital. Change in net working capital reflects midpoint of perpetuity growth rate range. EBITDA unburdened by amortization of developer reimbursements. Reflects sum of Right - of - Use Asset Amortization and Change in Lease Liabilities. Unlevered Free Cash Flow Detail Perpetuity Growth Rate Method Centerview Projection Period (1) Terminal (2) 2028E 2027E 2026E 2025E Q4'24 $16,525 $16,525 $15,910 $15,319 $14,792 $3,967 Net Sales $1,521 $1,521 $1,406 $1,340 $1,276 $367 EBITDA (3) (469) (532) (530) (571) (602) (145) ( - ) Total D&A (284) (267) (236) (208) (182) (61) ( - ) Taxes $768 $722 $639 $561 $492 $162 NOPAT 469 497 493 531 552 131 (+) D&A, Net – 35 37 40 50 14 (+) Developer Reimbursement Amort. (86) (86) (83) (81) (80) (20) ( - ) Cash Lease Expense Adj. (4) (15) (28) (49) (51) (104) 371 ( - /+) Δ in NWC (469) (469) (452) (435) (430) (179) ( - ) Capex $667 $671 $584 $566 $481 $479 Unlevered FCF Implied Share Price Implied Terminal LTM EBITDA Multiple Perpetuity Growth Rate 1.5% 2.0% 2.5% $27.60 $29.10 $30.80 $24.00 $25.20 $26.50 Perpetuity Growth Rate 1.5% 2.0% 2.5% 5.0x 5.2x 5.5x 4.5x 4.7x 5.0x WACC 11.00% 12.00% 13.00% $21.00 $21.90 $23.00 4.1x 4.3x 4.5x
PRELIMINARY & CONFIDENTIAL 22 0.95 Unlevered Beta (7) 60% Debt / Equity (8) 1.37 Levered Beta (9) 7.17% Historical Risk Premium (10) 0.95% Size Premium (11) 15.6% Cost of Equity (12) 7.75% Pre - Tax Cost of Debt (13) 27.0% Tax Rate (14) 5.7% After - Tax Cost of Debt Peer - Based WACC Risk - Free Rate (6) 4.82% WACC (15) 11.9% D / (D+E) 37.6% E / (D+E) 62.4% ILLUSTRATIVE WACC ANALYSIS Source: Company filings, Kroll, Bloomberg and FactSet as of December 16, 2024, except where otherwise noted. Note: U.S. dollars in millions. (1) Represents two - year weekly beta (based on local index) per Bloomberg. (2) Calculated as (Levered Beta / (1 + ((1 - Tax Rate) * Debt / Equity)). (3) Figures exclude finance leases. (4) Reflects Norse figures as of September 3, 2024. (5) Reflects Norse figures as of March 18, 2024. (6) Reflects U.S. 20 - year treasury note yield updated as of December 19, 2024. (7) Reflects Macy’s unlevered beta. (8) Reflects Macy’s debt / equity. (9) Reflects the levering of Macy’s unlevered beta at Macy’s debt / equity ratio. Levered Beta = (Unlevered Beta) * (1 + (1 - Tax Rate) * (Debt / Equity)). (10) Reflects U.S. Long - Horizon Equity Risk Premium per Kroll. (11) Reflects size premium per Kroll Valuation Handbook. (12) Calculated as Risk - Free Rate + (Historical Risk Premium * Levered Beta) + Size Premium. (13) Assumes illustrative cost of debt based on trading yields on bonds for Norse and selected peers. (14) Reflects Norse management long - term tax rate. (15) WACC equals ((Debt/Capitalization) * After - Tax Cost of Debt) + (Equity/Capitalization * Levered Cost of Equity)). Centerview WACC Analysis Beta Levered (1) Unlevered (2) Market Cap. Debt / Equity Company Debt (3) 60% 2,890 4,787 0.95 1.39 Macy's 137% 2,284 1,664 0.59 1.20 Kohl's 66% $2,689 $4,083 1.00 1.48 Norse - Current 68% $2,689 $3,983 1.26 1.88 Norse - Price Disclosure (4 102% $2,939 $2,891 1.11 1.94 Norse - Unaffected (5) 13.2% 12.9% 12.6% 12.3% 11.9% 11.6% 13.0% 12.7% 12.4% 12.1% 11.8% 11.4% 12.9% 12.5% 12.2% 11.9% 11.6% 11.3% 12.7% 12.4% 12.1% 11.8% 11.5% 11.2% WACC Sensitivity Analysis (Peer - Based) (15) Debt / Cap. Debt / Unlevered Beta Equity 0.90 0.95 1.00 1.05 1.10 1.15 33% 50% 43% 75% 50% 100% 56% 125%
PRELIMINARY & CONFIDENTIAL 23 0.50 0.60 0.80 0.70 0.90 1.00 1.10 1.20 1.30 1.40 1.50 Dec - 22 Mar - 23 Jun - 23 Sep - 23 Dec - 23 Mar - 24 Jun - 24 Sep - 24 Dec - 24 BETAS OVER TIME Source: Bloomberg as of December 16, 2024. Note: Represents two - year weekly beta based on the local index. (1) Reflects Norse unlevered beta as of March 18, 2024. (2) Reflects Norse unlevered beta as of September 3, 2024. Rolling Two - Year Weekly Unlevered Beta – Last Two Years 1.00 0.94 0.58 Norse Macy’s Kohl’s 1.26 Pre - Price Disclosure (2) 2Y Avg: 1.16 2Y Avg.: 0.95 2Y Avg: 1.17 1.11 Unaffected (1) Centerview
PRELIMINARY & CONFIDENTIAL 24 SELECTED DEPARTMENT STORE BOND YIELDS Source: FactSet as of December 16, 2024. Note: Dollars in millions. Reflects bonds with greater than $100mm principal balance outstanding for Norse and peers. (1) Represents ICE BofA US High Yield (BB) index and ICE BofA US Issuers High Yield Retail index, respectively. Current US High Yield (BB) index yield of 6.15% and US High Yield Retail index yield of 7.33% (1) Amt. Maturity Issue YTW Out. Date Date 5.89% $350 03/2027 03/2017 5.84% $300 03/2028 03/1998 6.29% $500 04/2030 11/2019 6.31% $425 08/2031 07/2021 7.58% $149 01/2038 12/2007 7.35% $966 01/2044 06/2014 Amt. Maturity Issue YTW Out. Date Date 6.34% $326 04/2029 03/2021 6.68% $425 03/2030 03/2022 7.01% $425 03/2032 03/2022 8.56% $181 07/2034 07/2020 6.64% $367 12/2034 11/2014 7.59% $193 03/2037 03/2007 7.52% $250 01/2042 01/2012 7.19% $250 02/2043 11/2012 YTW Amt. Out. Maturity Issue Date 5.84% $353 07/2025 07/2015 8.81% $500 05/2031 03/2021 10.70% $112 01/2033 11/2002 10.43% $101 12/2037 09/2007 9.39% $427 07/2045 07/2015 Norse Macy's Kohl's Centerview
PRELIMINARY & CONFIDENTIAL 25 PRECEDENT INDUSTRY TRANSACTIONS Selected U.S. Department Store Transactions Source: Company filings, FactSet and Wall Street research. Note: Dollars in billions. (1) Based on Wall Street broker estimates for CY 2024. AV / LTM EBITDA AV / LTM Revenue Aggregate Value Acquiror Announcement Date Target 6.3x 0.68x $2.8 Sycamore Partners Aug - 15 Belk 9.1x 1.31x 6.1 CPPIB & Ares Sep - 13 Neiman Marcus 10.9x 0.91x 2.9 HBC Jul - 13 Saks 9.1x 0.91x 2.9 Median 8.8x 0.97x 3.9 Average Memo - Unconsumated Transactions Jul - 24 Neiman Marcus HBC Jun - 24 Macy's Arkhouse & Brigade $2.7 ~0.6x ~8.6x 9.2 0.39x 4.2x Macy’s Board unanimously determined that the proposal remains non - actionable and fails to provide compelling value to Macy’s shareholders Transaction remains contingent on additional financing (1) (1) (Proposal Date) Centerview
PRELIMINARY & CONFIDENTIAL 26 Disclosed Valuation Details Date Price Target Rating Firm Name Discounted Cash Flow 12/5/2024 $38.50 Buy Morningstar 12.3x 2026E EPS 11/27/2024 $26.00 Hold Telsey ~11.0x FY2025E EPS 11/27/2024 $25.00 Hold Gordon Haskett ~5x FY2024E AV / EBITDA 11/26/2024 $25.00 Hold Citi FY25 EPS of $2.05 and 12x P/E. 11/27/2024 $25.00 Hold TD Cowen 4.75x 2Y Forward EV/EBITDA 11/26/2024 $24.00 Hold Goldman Sachs 11.5x FY2025 P/E 11/27/2024 $23.00 Hold Jefferies 11.0x NTM P/E Based on CY2026 EPS 11/26/2024 $23.00 Hold Barclays 22.5x AV/EBITDA FY2025E 11/27/2024 $22.00 Sell Bank of America 10.0x 2026 EPS 11/26/2024 $22.00 Hold Evercore ~10.0x FY2025 EPS 11/29/2024 $22.00 Hold BMO ~4.3x 2026E EBITDA 11/26/2024 $21.00 Sell JP Morgan ~0.3x 2026E AV / Sales 11/27/2024 $14.50 Sell UBS NA 11/27/2024 NA Hold Guggenheim NA 12/9/2024 NA Hold William Blair 12.2x 2025E P/E & 6.8x 2025E AV / EBITDA 12/2/2024 NA Hold KeyBanc NA 11/27/2024 NA NA Morgan Stanley $23.00 Median (1) $22.65 Mean (1) $19.81 (2) $20.12 (2) ILLUSTRATIVE ANALYST PRICE TARGETS Excluded Brokers with Revised Price Targets Based on Transaction - related News Analyst price targets above unaffected Norse share price of $17.06 and below current share price of $23.35 Source: Wall Street Equity Research, Market Data as of December 16, 2024. (1) Morningstar, KeyBanc, Barclays and Morgan Stanley price targets excluded from median and mean calculations. Centerview
PRELIMINARY & CONFIDENTIAL 27 2.0x 2.5x 3.0x 3.6x 3.5x 4.1x 4.0x 4.5x 5.2x 5.0x 5.5x 6.0x Dec - 22 Mar - 23 Jun - 23 Sep - 23 Dec - 23 Mar - 24 Jun - 24 Sep - 24 Dec - 24 MULTIPLES OVER TIME Source: Company filings, FactSet as of December 16, 2024. 3.9x +7.4% 5.5x +33.0% 5.2x +0.6% Norse Macy’s Kohl’s AV / NTM EBITDA Multiples – Last Two Years July 4, 2024: HBC / Neiman announced Median Peer NTM Multiple: 4.7x Dec. 8, 2023: Leak of buyout bid from Arkhouse Management & Brigade Capital of $21 per share Median Peer NTM Multiple: 4.9x March 19, 2024: Leak of Norse take - private Median Peer NTM Multiple: 4.9x Centerview
PRELIMINARY & CONFIDENTIAL 28 $0 $5 $10 $20 $16.34 $15 $25 $30 $35 Dec - 22 Mar - 23 Jun - 23 Sep - 23 Dec - 23 Mar - 24 Jun - 24 Sep - 24 Dec - 24 TWO - YEAR SHARE PRICE PERFORMANCE Source: FactSet as of December 16, 2024. Share Price Performance – Last Two Years $23.35 +42.9% +57.7% (18.0%) (44.9%) Norse Macy’s Kohl’s S&P 500 March 19, 2024: Leak of Norse take - private 1 - Day Share Price Reaction: +13.6% September 4, 2024: Norse 13 - D filed; formation of Bid Group and price disclosure 1 - Day Share Price Reaction: (0.2%) February 11, 2024: Special Committee formed May 3, 2024: Sycamore named in Norse take - private leak June 19, 2024: Process letter shared with E&P Centerview
PRELIMINARY & CONFIDENTIAL APPENDIX C INVESTOR PERSPECTIVES ON NORSE'S VALUATION MULTIPLE 29
PRELIMINARY & CONFIDENTIAL 30 Off - Price Retail Kohl's Macy's Current (12/8/2023) Norse Current (3/18/2024) 38.6% (49.3%) (15.2%) (24.3%) 33.0% 3.0% L1Y ∆ 50.3% (44.9%) (18.0%) (36.4%) 42.9% (36.5%) L2Y ∆ 37.2% (70.9%) (33.1%) 51.0% 14.3% (59.9%) L3Y ∆ 31.1% (71.3%) 7.0% (45.1%) (39.9%) (61.4%) L5Y ∆ Norse reports Q3 FY2024 earnings aftermarket; Shares fall (1.1%) on the day 0 50 100 150 200 250 Dec - 19 Jun - 20 Dec - 20 Jun - 21 Dec - 21 Jun - 22 Dec - 22 Jun - 23 Dec - 23 (39.9%) (71.3%) +7.0% SECTOR SHARE PRICE PERFORMANCE OVER TIME Source: Capital IQ as of December 16, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of December 16, 2024 3. Represents Macy’s as of unaffected date of December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL Share Price Performance Over Time Indexed to 100; Since December 16, 2019 300 (3) Macy's Unaffected Norse Unaffected (1) (4) Post Norse Unaffected Period To Current (2) May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; Share Price increased +5.1% day after earnings January 22, 2024: Macy’s announces it will not enter into an agreement with Arkhouse and Brigade March 18, 2024: Norse unaffected share price of $17.06 Jun - 24 Dec - 24 July 3, 2024: Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal December 8, 2023: Macy’s unaffected share price of $17.39 August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; Share Price increased +4.2% day after earnings July 15, 2024 Macy’s terminates discussions with Arkhouse November 26, 2024: and Brigade
PRELIMINARY & CONFIDENTIAL 31 SECTOR VALUATION MULTIPLES OVER TIME Source: Capital IQ as of December 16, 2024 Notes: 1. Represents Norse as of unaffected date of March 18, 2024 2. Market data as of December 16, 2024; for Norse Current Today, reflects $2,689MM of debt as of fiscal Q3 2024 and $397MM of cash as of fiscal Q3 2024 per Norse Management 3. Represents Macy’s as of unaffected date of December 8, 2023 4. Off - Price Retail Peers include ROST, TJX and BURL AV / NTM EBITDA Over Time Since December 16, 2019 Post Norse Unaffected Period To Current December 8, 2023: Macy’s unaffected multiple of 3.7x November 17, 2022: Kohl’s announces they will not engage in transformative transactions; multiple of 5.6x January 21, 2022: Kohl’s unaffected multiple of 4.0x January 24, 2022: News of takeover offer; Kohl’s affected multiple of 5.1x May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket; multiple of 5.1x March 18, 2024: Norse unaffected multiple of 4.7x August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket; multiple of 5.5x Saks parent HBC announced it will acquire Neiman Marcus in a $2.65Bn deal (4) Kohl's Off - Price Retail Macy's Current Macy's Unaffected (3) (12/8/2023) (2) Norse Current Norse Unaffected (1) (3/18/2024) 16.2x 5.2x 3.9x 3.7x 5.5x 4.7x Today 15.3x 5.2x 3.6x 3.1x 5.2x 4.4x L1Y Avg. 14.6x 5.2x 3.3x 3.2x 5.2x 4.4x L2Y Avg. 13.8x 5.0x 3.3x 3.8x 5.0x 5.0x L3Y Avg. 14.7x 5.0x 4.4x 4.5x 5.2x 5.2x L5Y Avg. November 26, 2024: Norse reports Q3 FY2024 earnings aftermarket; multiple of 5.4x 2.0x 0.0x 8.0x 10.0x 12.0x Dec - 19 Jun - 20 Dec - 20 Jun - 21 Dec - 21 Jun - 22 Dec - 22 Jun - 23 Dec - 23 Jun - 24 Dec - 24 July 3, 2024: 5.5x 5.2x 3.9x 6.0x 5.4x 5.0x 4 4 .0 .3 x x
PRELIMINARY & CONFIDENTIAL 32 $17.06 $18.66 $18.74 $19.98 $21.03 $21.14 $22.78 $24.62 – 15.0 20.0 10 15 20 25 30 35 3/15 4/29 5/13 5/28 6/11 6/26 7/11 7/25 8/8 8/22 9/6 9/20 12/16 +36.9% $23.35 10.0 (21.3%) 5.0 (42.9%) NORSE’S SHARE PRICE SINCE UNAFFECTED DATE Source: Capital IQ Note: 1. Market data as December 16, 2024 10/4 10/18 11/1 11/15 12/2 Norse Volume (MM) Share Price Performance and Trading Volume Over Time (1) Since March 18, 2024 Share Price ($) April 18, 2024: Erik and Pete Nordstrom file Schedule 13D; Announce formation of Special Committee May 30, 2024: Norse reports Q1 FY2024 earnings aftermarket. Beats on consensus revenue estimates, misses on EPS, and reaffirms guidance Average Volume: 2.6MM Norse Macy’s Kohl’s March 19, 2024: Reuters report of Norse’s potential take - private Volume (MM) 3/18 4/1 4/15 March 18, 2024: Unaffected date May 2, 2024: Rumors of Sycamore Partners’ participation on potential take - private transaction September 4, 2024: Offer Disclosure August 27, 2024: Norse reports Q2 FY2024 earnings aftermarket. In - line with consensus revenue estimates and beats on consensus EBIT and EPS estimates. Raised low - ends of all guidance ranges November 26, 2024: Norse reports Q3 FY2024 earnings aftermarket. Beats on consensus revenue, EBIT and EPS estimates. Raised low - ends of revenue and comparable sales growth guidance ranges
PRELIMINARY & CONFIDENTIAL 33 LEGAL DISCLAIMER – MORGAN STANLEY We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately. 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PRELIMINARY & CONFIDENTIAL 34 LEGAL DISCLAIMER – CENTERVIEW This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by the Special Committee of the Board of Directors of Norse ("the Special Committee") and for no other purpose. The information contained herein is based upon information supplied by or on behalf of the Company and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by the Company and approved for our use by the Special Committee. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of the Company or any other entity, or concerning the solvency or fair value of the Company or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company, and at the direction of the Special Committee Centerview has relied upon such forecasts, as provided by the Company’s management, with respect to the Company. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of the Company. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Board of Directors of the Company (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of the Company or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview.
Exhibit (c)(xix)
S T R I C T L Y P R I V A T E A N D C O N F I D E N T I A L December 2024 Nordstrom – Valuation Overview
C O N F I D E N T I A L P R O J E C T N A V Y Executive Summary SITUATION OVERVIEW Nordstrom is conducting a sale process for a potential take private transaction Nordstrom created a special committee to analyze any potential offers Liverpool currently owns a ~9.6% stake in Nordstrom and has been Nordstrom’s second - largest minority shareholder since 2022, behind the Nordstrom family Liverpool is participating in such potential take private process in partnership with the Nordstrom family If successful, potential resulting pro - forma ownerships would be: – Liverpool: 49.9%, Nordstrom family 50.1% J.P. Morgan has been engaged by Liverpool to provide views on valuation and M&A advisory on transaction structure as well as negotiations with both its partners and the target Nordstrom’s special committee held a couple of meetings to analyze the offers and concluded on October 18 th that they would recommend accepting a price of US$24.25 per share, valuing Nordstrom’s Equity Value at US$4,008mm 1 VALUATION ASSIGNMENT To perform the valuation analysis, J.P. Morgan relied entirely on projections and long - term views of the Target provided and approved by the management of Liverpool based on the management of Nordstrom (the “Nordstrom Management”) projected figures. Such projections include, among others, perpetuity growth assumptions J.P. Morgan has also consulted publicly available information for some reference data points, all labeled appropriately throughout the Presentation Notes: 1 Considers a number of diluted shares outstanding of ~165.3mm shares for Nordstrom as of December 17, 2024 1
C O N F I D E N T I A L P R O J E C T N A V Y Agenda Page 2 Nordstrom Overview 1 5 Navy Valuation 2 14 Appendix 3
C O N F I D E N T I A L P R O J E C T N A V Y Nordstrom At - A - Glance (For Reference Only) Source: Company public filings, company website, press releases Notes: 1 Considers stake at the time of acquisition (pre - dilution effects since then) COMPANY OVERVIEW BUSINESS SEGMENTS KEY MANAGEMENT Erik Nordstrom Chief Executive Officer Peter Nordstrom President & Chief Brand Officer Cathy Smith Chief Financial Officer Serves customers through 380+ Nordstrom, Nordstrom Local and Nordstrom Rack locations and digitally through the Nordstrom and Rack apps and website In 2024, received a going private transaction proposal from Nordstrom family and Liverpool In 2024 , launched a new digital marketplace, growing its online product assortment In 2023 , Nordstrom Canada commenced a wind - down of its business operations In 2022 , Liverpool acquired a 9.9% passive stake in Nordstrom for 5.9bn pesos (~$294mm at ~US$18.4 per share) 1 In 2021 , partnered with ASOS for the acquisition of a minority interest in the Topshop, Topman, Miss Selfridge and HIIT brands Founded in 1901 and headquartered in Seattle, WA 99 Stores In US 3,000+ Brands Sold 282 Stores In US +5% 2024E Revenue Growth 23 New Stores This Year NORDSTROM NORDSTROM - RACK Leading destination for a breadth of products across brands, styles and prices Premier off - price destination with an industry - leading off - price digital presence GEOGRAPHIC PRESENCE TX MT ID OR IL WY MN SD IA ND KS NE WA WI OK MI MO NY PA FL IN AL GA AR LA VA TN KY OH MS ME NC SC MI WV NJ VT NH MA RI NV UT CO Ann Munson CA HI Steines AZ NM Chief Legal Officer, General Counsel and AK Corporate Secretary 40+ In - house Brands Store presence 2
C O N F I D E N T I A L Nordstrom At - A - Glance (Continued) (For Reference Only) 3 - YEAR SHARE PRICE PERFORMANCE IN USD (REBASED TO 100%) VALUATION AND FINANCIAL SUMMARY ($mm, Except Per Share Data) $22.93 Share Price (12/9/24) 91.8% % 52 - wk High 175.4 4 Shares Outstanding (mm) $4,022 Market Value $2,690 + Debt 6 ($397) - Cash 6 $6,315 Firm Value tes 2 2026E sus Estima 2025E Consen 2024E 2023A 1 FYE 01/31 $15,559 $15,165 $14,863 $14,693 Revenue 2.6% 2.0% 1.2% (5.4%) % Growth $1,222 7 $1,191 $1,178 $1,084 Adj. EBITDA 5 7.9% 7.9% 7.9% 7.4% % Margin $2.10 $2.03 $2.00 $2.12 Adj. EPS 5 3.4% 1.5% (5.7%) 25.4% % Growth 2026E 2025E 2024E Valuation 0.4x 0.4x 0.4x FV / Revenue 5.2x 5.3x 5.4x FV / EBITDA 10.9x 11.3x 11.5x P / E 5.0x 10.0x 15.0x 20.0x 25.0x 30.0x Current 3 - Months 6 - Months 1 - Year 3 - Years 5.0x 5.1x 5.0x 4.6x Nordstrom 5.3x Dept. Stores 6.1x 5.5x 5.4x 5.6x 5.1x 15.6x 15.6x 15.0x 13.6x Off - Price 16.6x Online Retail 19.9x 17.5x 15.5x 14.8x 15.6x 6.1x 5.3x 19.9x 16.6x 0% December - 2021 December - 2022 3 - YEAR FV / NTM EBITDA 50% 100% 150% 200% 250% December - 2023 December - 2024 8.9% (14.1%) Nordstrom Dept. Stores Off - Price Online Retail S&P 500 3 - Months 6 - Months 1 - Year 3 - Years 3.8% 8.1% 40.2% 8.9% 14.9% (6.4%) 2.5% (14.1%) 6.9% 15.9% 37.2% 36.7% 63.9% 54.8% 88.8% (58.3%) 10.6% 12.9% 31.5% 29.7% 0.0x December - 2021 December - 2022 December - 2023 December - 2024 Source: Factset as of December 09, 2024 Note: FY 1/31; Dept. Stores include Macy’s, Kohl’s, Dillard’s; Off - Price includes TJX, Ross Stores, Burlington; Online retail includes Zalando, Revolve Group, Mytheresa; 1 Historical data as provided by Nordstrom Management and public filings; 2 Broker estimates consider credit card revenue within their projections; 3 Considers stake at the time of acquisition (pre - dilution effects since then); 4 Considers 164.9mm basic shares outstanding and dilution from 7.6mm outstanding options with a weighted average strike price of $35 and 10.5mm RSUs; 5 Adjustments for the 2019A - 2023A period include Canada wind - down costs, Trunk Club wind - down costs, supply chain asset impairment, gain on sale of interest in a corporate office building, Attabotics impairments, and other; 6 Considers Debt and Cash as of Q3’24 (November 2, 2024); 7 Extrapolated based on 2025E EBITDA margin due to lack of broker estimates P R O J E C T N A V Y 3 36.7% 29.7% (58.3%)
C O N F I D E N T I A L P R O J E C T N A V Y Adjusted EBITDA FCF 2 Financials Summary – Management Vs. Consensus Estimates Nordstrom management projects an expansion in EBITDA margin, while consensus estimates projects EBITDA margins in line with historicals and Liverpool management expects lower margins Revenue 1 Street Case 24E - 26E CAGR Nordstrom management forecasts reflect higher growth vs. consensus in driven by strong expansion of Rack footprint and further e - commerce penetration through Marketplace Capital Expenditures % Revenue Nordstrom management expects a decline in CapEx through 2026E, while brokers and Liverpool management project a ~4% CAGR from 2024E - 2026E Nordstrom management expects to streamline digital/supply chain spend, resulting in capex savings and higher FCF conversion relative to consensus and Liverpool management COMMENTARY HISTORICAL PROJECTED $bn Source: Factset as of December 9 th , 2024; Liverpool Management & Nordstrom Management projections as of December 9 th , 2024 Notes: Financials reflect FYE 1/31; 1 Includes credit card revenue; 2 Defined as Adj. EBITDA less CapEx; 3 Defined as (Adj. EBITDA – CapEx) / Adj. EBITDA; 4 Extrapolated due to lack of broker estimates $14.7 2023A $1.1 2023A $0.6 2023A $0.5 2023A % Conversion 3 % Growth $15.6 $15.8 $15.3 $15.3 $15.2 $14.9 $14.8 $14.8 $15.8 2024E 2025E 2026E Nordstrom Mgmt. Liverpool Mgmt. 2.3% 3.5% 3.5% 3.6% 3.6% 2.6% 3.4% 3.4% 2.0% 0.5% 0.5% 1.2% (5.4%) $1.2 $1.2 $1.1 $1.2 $1.3 $1.0 $1.1 $1.1 2024E 2025E 2026E $0.5 $0.5 $0.6 $0.5 $0.4 $0.4 $0.5 $0.5 $0.6 2024E 2025E 2026E $0.7 $0.7 $0.7 $0.6 $0.8 $0.9 $0.5 $0.5 $0.6 2024E 2025E 2026E % Margin 7.4% 7.9% 7.4% 6.6% 7.9% 8.0% 6.9% 7.9% 8.2% 7.2% 3.5% 2.7% 3.6% 3.5% 2.8% 3.5% 3.4% 3.4% 3.5% 3.9% 51.6% 66.5% 53.8% 49.4% 64.8% 55.2% 47.9% 54.0% 55.7% 47.5% 1.8% 9.2% 8.5% $1.2 4 4.0% (6.7%) 4.4% 0.1% 21.0% 12.7% (For Reference Only) 4
C O N F I D E N T I A L P R O J E C T N A V Y Agenda Page 2 Nordstrom Overview 1 5 Navy Valuation 2 14 Appendix 3
C O N F I D E N T I A L P R O J E C T N A V Y Key Valuation And Projection Assumptions Liverpool Management projections D&A D&A represents 3.8% of Retail Revenues in 2024E, gradually decreasing to 3.4% by 2033E SG&A Capital Expenditures Capital Expenditures represents 3.5% of Retail Revenues in 2024E, 3.6% from 2025E – 2027E and decreases back to 3.5% from 2028E onwards Capital Expenditures estimates consider expansion (including new store and distribution center openings) and technology investments SG&A considers salaries, marketing, fulfillment and technology expenses, among others, and grows at an average of 3.0% for 2024E – 2028E, reaching a target nominal growth of 3.1% in 2033E Working Capital Working Capital assumes constant days of inventory, receivables and payables for the period in 2024E - 2033E Revenues Retail Revenues are calculated based on an average nominal growth of 3.1% for 2024E – 2028E and reaches a target nominal growth of 3.1% in 2033E Credit Card Revenues represent 3.1% of Retail Revenues in 2024E, increasing to 3.3% in 2026E and remaining constant up to 2033E Source: Liverpool Management projections Notes: 1 Considers outstanding debt of US$2,690mm and Cash & Cash Equivalents of $830mm; 2 As mentioned by Nordstrom’s management, although subject to further diligence; Others General Financial projections as provided by Liverpool Management and historical data as provided by Nordstrom Management and public filings Valuation date as of January 31, 2025 Balance Sheet Items Projected Net Debt as of January 31, 2025, of US$1,860mm 1 Terminal Value Assumptions Terminal growth rate range: 1.5% – 2.5% D&A as % of CapEx for terminal period of 96.9% Effective tax rate of 27.0% 2 Capex as % of Retail revenues for terminal period of 3.5% COGS Retail Gross margin remains constant at 34.6% from 2024E to 2033E 5
C O N F I D E N T I A L P R O J E C T N A V Y Summary Of Liverpool’s Nordstrom Projections CAGR Liverpool Management Projections Historical FYE – 01/31 ($mm) 24E - 33E 24E - 28E 2033E 2032E 2031E 2030E 2029E 2028E 2027E 2026E 2025E 2024E 2023A 3.3% 3.7% 19,841 19,251 18,680 18,125 17,587 17,065 16,430 15,819 15,272 14,766 14,693 Total Revenues - - 3.1% 3.1% 3.1% 3.1% 3.1% 3.9% 3.9% 3.6% 3.4% 0.5% (5.4%) % Growth 3.3% 3.6% (12,571) (12,197) (11,835) (11,484) (11,143) (10,812) (10,410) (10,023) (9,678) (9,369) (9,303) Cost Of Goods Sold - - 63.4% 63.4% 63.4% 63.4% 63.4% 63.4% 63.4% 63.4% 63.4% 63.4% 63.3% % Of Retail Revenues 3.3% 3.6% 6,642 6,445 6,254 6,068 5,888 5,713 5,501 5,296 5,114 4,951 4,916 Retail Gross Profit - - 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% % Margin Of Retail Revenues 3.0% 3.0% (6,499) (6,306) (6,118) (5,937) (5,760) (5,589) (5,381) (5,210) (5,086) (4,962) (4,824) SG&A - - 33.8% 33.8% 33.8% 33.8% 33.8% 33.8% 33.8% 34.0% 34.4% 34.6% 33.9% % Of Retail Revenues 6.6% 11.1% 771 748 726 705 684 664 640 586 507 436 567 Adj. EBIT - - 3.9% 3.9% 3.9% 3.9% 3.9% 3.9% 3.9% 3.7% 3.3% 3.0% 3.9% % Margin 2.2% 1.8% 655 636 617 599 581 577 568 559 552 538 517 D&A - - 3.4% 3.4% 3.4% 3.4% 3.4% 3.5% 3.6% 3.7% 3.7% 3.8% 3.6% % Of Retail Revenues 4.3% 6.2% 1,427 1,384 1,343 1,303 1,265 1,240 1,208 1,146 1,059 974 1,084 Adj. EBITDA - - 7.2% 7.2% 7.2% 7.2% 7.2% 7.3% 7.4% 7.2% 6.9% 6.6% 7.4% % Margin 3.2% 3.5% 676 656 637 618 599 582 567 554 536 508 569 Capital Expenditures - - 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.6% 3.6% 3.6% 3.5% 4.0% % Of Retail Revenues Sources: Liverpool Management projections Notes: FY 1/31; 6
C O N F I D E N T I A L P R O J E C T N A V Y Summary Of Liverpool’s Nordstrom Projections As of May 2024 2026E 2025E 2024E 2026E 2025E 2024E 2026E 2025E 2024E FYE – 01/31 ($mm) 220 157 162 15,319 14,792 14,320 15,099 14,635 14,158 Retail Revenue 40 bps (10 bps) 110 bps 3.6% 3.3% 0.7% 3.2% 3.4% (0.4%) % Growth (12) (13) (19) 500 479 447 512 492 466 Credit Card Net Revenue 50 bps 180 bps (420 bps) 4.4% 7.3% (5.9%) 3.9% 5.5% (1.7%) % Growth 208 145 141 15,819 15,272 14,766 15,611 15,127 14,625 Total Revenues 40 bps - 100 bps 3.6% 3.4% 0.5% 3.2% 3.4% (0.5%) % Growth (144) (103) (106) (10,023) (9,678) (9,369) (9,879) (9,575) (9,263) Retail Cost Of Goods Sold 76 54 56 5,296 5,114 4,951 5,220 5,060 4,895 Retail Gross Profit - - - 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% % Margin Of Retail Revenues (75) (54) (56) (5,210) (5,086) (4,962) (5,135) (5,032) (4,906) SG&A - - - 34.0% 34.4% 34.6% 34.0% 34.4% 34.6% % Of Retail Revenues (10) (13) (20) 586 507 436 596 520 456 Adj. EBIT 21 24 21 559 552 538 538 528 517 D&A 10 bps 10 bps 20 bps 3.7% 3.7% 3.8% 3.6% 3.6% 3.6% % Of Retail Revenues 12 11 2 1,146 1,059 974 1,134 1,048 972 Adj. EBITDA (10 bps) - - 7.2% 6.9% 6.6% 7.3% 6.9% 6.6% % Margin 4 6 (4) 592 524 466 588 518 470 Adj. EBITDA – Capital Expenditures (8) (6) (6) (554) (536) (508) (546) (530) (502) Capital Expenditures - - - 3.6% 3.6% 3.5% 3.6% 3.6% 3.5% % Of Retail Revenues (4) - (12) (37) (34) 10 (33) (34) 22 (Inc.)/Dec In OWC - - (10 bps) (0.2%) (0.2%) 0.1% (0.2%) (0.2%) 0.2% % Of Retail Revenues As of November 2024 Differences Sources: Liverpool Management projections Notes: FY 1/31; 7
C O N F I D E N T I A L P R O J E C T N A V Y Nordstrom Analysis At Various Prices (For Reference Only) Source: Factset as of December 09, 2024 Note: Analysis does not consider potential transaction fees and expenses; 1 Liverpool Management projections Street Cons. Illustrative Purchase Price Per Share Current Metric ($mm, Except Per Share Items) $34.40 $33.25 $32.10 $30.96 $29.81 $28.66 $27.52 $26.37 $25.22 $24.08 $22.93 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% Implied % Premium To Current Price Implied Premium To: 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% $22.90 3 - Month VWAP 53% 48% 43% 38% 33% 28% 23% 18% 12% 7% 2% $22.43 6 - Month VWAP 70% 65% 59% 53% 48% 42% 36% 31% 25% 19% 14% $20.20 1 - Year VWAP 38% 33% 28% 24% 19% 15% 10% 6% 1% (4%) (8%) $24.99 52 - Week High (As Of 11/25/24) 118% 111% 103% 96% 89% 82% 74% 67% 60% 53% 45% $15.79 52 - Week Low (As Of 12/13/23) 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% (0%) $23.00 Median Analyst Share Price Target 177 177 177 176 176 175 175 175 175 175 175 Fully Diluted Shares Outstanding (MM) $6,095 $5,882 $5,668 $5,454 $5,239 $5,028 $4,826 $4,625 $4,424 $4,223 $4,022 Implied Total Equity Value $2,690 $2,690 $2,690 $2,690 $2,690 $2,690 $2,690 $2,690 $2,690 $2,690 $2,690 (+) Total Debt (As Of 11/02/24) ($397) ($397) ($397) ($397) ($397) ($397) ($397) ($397) ($397) ($397) ($397) ( - ) Cash (As Of 11/02/24) - - - - - - - - - - - (+) Minority Interest (As Of 11/02/24) $8,388 $8,175 $7,961 $7,747 $7,532 $7,321 $7,119 $6,918 $6,717 $6,516 $6,315 Implied Firm Value IMPLIED MULTIPLES 7.1x 6.9x 6.8x 6.6x 6.4x 6.2x 6.0x 5.9x 5.7x 5.5x 5.4x $1,178 FV / 2024E Adj. EBITDA 7.0x 6.9x 6.7x 6.5x 6.3x 6.1x 6.0x 5.8x 5.6x 5.5x 5.3x $1,191 FV / 2025E Adj. EBITDA 8.6x 8.4x 8.2x 8.0x 7.7x 7.5x 7.3x 7.1x 6.9x 6.7x 6.5x $974 FV / 2024E Adj. EBITDA 7.9x 7.7x 7.5x 7.3x 7.1x 6.9x 6.7x 6.5x 6.3x 6.2x 6.0x $1,059 FV / 2025E Adj. EBITDA Mgmt. Case 1 8
C O N F I D E N T I A L P R O J E C T N A V Y Standalone Valuation Analysis COMMENTARY ($MM) Based On Management Projections METRIC ILLUSTRATIVE UNITY SHARE PRICE ($ / SHARE) 1 NORDSTROM EQUITY VALUE ($BN) Source: Liverpool Management projections; FactSet as of December 09, 2024 Note: Assumes valuation date of June 30, 2024, and Net Debt of $2,186mm; 1 Rounded to the nearest $0.50 per share expect 52 - week trading range and analyst price targets; 2 Liverpool management projections; 3 Represents Macy’s affected multiple; 4 Adj. EBITDA as provided by Nordstrom management as of Q3’24; 5 Represents Sycamore / Belk transaction multiple from 2015; 6 Represents Ares / Neiman Marcus transaction multiple from 2013; 7 Brokers estimate a (23%) decline in sales in 2025E NORDSTROM FIRM VALUE ($BN) (For Reference Only) Pre - Family announcement Share Price As Of 04/17: $17.95 Current Share Price: $22.93 Agreed Price As Of 10/18: $24.25 + $0.25 Per Share Special Dividend $2.8bn - $4.4bn $5.1bn - $6.7bn 2025E EBITDA 2 : $1,059 Multiple Range: 4.8x – 6.3x 4.99 FV / 2025E $15.79 $2 EBITDA 52 - Week Trading Range $2.5bn - $4.6bn $4.8bn - $6.9bn 2025E EBITDA 2 : $1,059 Multiple Range: 4.6x – 6.5x 26.00 Median: $23.00 FV / 2025E $14.50 $ EBITDA Broker Price Targets $1.5bn - $3.3bn $3.8bn - $5.6bn 2025E EBITDA 2 : $1,059 43.01 Multiple Range: 3.6x 3 – 5.3x Reference of 9.3x 7 $ Dillard’s Multiple FV / 2025E EBITDA $8.50 $18.50 Trading Multiples $5.1bn - $8.1bn $7.4bn - $10.4bn LTM EBITDA 4 : $1,114 $45.50 Multiple Range: 6.6x 5 – 9.3x 6 FV / LTM ADJ. EBITDA $29.00 Transaction Multiples $3.3bn - $4.5bn $5.2bn - $6.4bn Discount Rate: 9.0% - 10.0% TVGR: 1.5% - 2.5% $27.32 N/A $20.16 Discounted Cash Flow 9
C O N F I D E N T I A L 1/31/2025 Valuation Date 9.00% – 10.00% Illustrative Discount Rate 1.5% – 2.5% Terminal Growth Rate Liverpool Management Projections Through FY 2033E UNLEVERED FREE CASH FLOW SUMMARY Illustrative Discounted Cash Flow Analysis Management Projections Terminal 2033E 2032E 2031E 2030E 2029E 2028E 2027E 2026E 2025E 2024E 01/31 fiscal year end, $mm $19,597 $19,213 $18,643 $18,089 $17,552 $17,031 $16,525 $15,910 $15,319 $14,792 $14,320 Retail Revenue $640 $627 $609 $591 $573 $556 $540 $520 $500 $479 $447 Credit Card Revenue $20,237 $19,841 $19,251 $18,680 $18,125 $17,587 $17,065 $16,430 $15,819 $15,272 $14,766 Revenues 2.0% 3.1% 3.1% 3.1% 3.1% 3.1% 3.9% 3.9% 3.6% 3.4% 0.5% % Growth $6,775 $6,642 $6,445 $6,254 $6,068 $5,888 $5,713 $5,501 $5,296 $5,114 $4,951 Retail Gross Profit 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% 34.6% % Margin Of Retail Revenues $1,455 $1,427 $1,384 $1,343 $1,303 $1,265 $1,240 $1,208 $1,146 $1,059 $974 Adj. EBITDA 7.2% 7.2% 7.2% 7.2% 7.2% 7.2% 7.3% 7.4% 7.2% 6.9% 6.6% % Margin ($668) ($655) ($636) ($617) ($599) ($581) ($577) ($568) ($559) ($552) ($538) Less: Depreciation & Amortization $787 $771 $748 $726 $705 $684 $664 $640 $586 $507 $436 Adj. EBIT ($212) ($208) ($202) ($196) ($190) ($185) ($179) ($173) ($158) ($137) ($118) Less: Taxes 27.0% 27.0% 27.0% 27.0% 27.0% 27.0% 27.0% 27.0% 27.0% 27.0% 27.0% % Tax Rate $574 $563 $546 $530 $514 $499 $484 $467 $428 $370 $318 EBIAT $668 $655 $636 $617 $599 $581 $577 $568 $559 $552 $538 Plus: Depreciation & Amortization 96.9% 96.9% 96.9% 96.9% 96.9% 96.9% 99.2% 100.1% 101.0% 103.0% 106.0% % Capex ($690) ($676) ($656) ($637) ($618) ($599) ($582) ($567) ($554) ($536) ($508) Less: Capex 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.6% 3.6% 3.6% 3.5% % Retail Revenues ($27) ($41) ($39) ($38) ($37) ($36) ($44) ($42) ($37) ($34) $10 Plus: (Inc.)/Dec In OWC (0.1%) (0.2%) (0.2%) (0.2%) (0.2%) (0.2%) (0.3%) (0.3%) (0.2%) (0.2%) 0.1% % Retail Revenues - - - - - - ($56) ($56) ($56) ($56) - Less: Payment Of RSUs $526 $502 $487 $472 $458 $445 $380 $370 $340 $297 $359 Unlevered FCF Source: Public fillings, Liverpool Management projections Notes: Valuation date as of January 31, 2025; Cash flows discounted based on mid - year convention; Multiples calculated in US; Figures consider year end in January 31 st ; P R O J E C T N A V Y 1 Projected Net Debt as of January 31, 2025. Debt calculation does not consider leases; 2 Considers a calculated diluted number of shares outstanding of ~165.3 mm shares for Nordstrom Implied TV / 2033E Adj. EBITDA A + B Firm Value B PV Of Terminal Value A PV Of FCFs Prelim. Terminal Growth Rate Prelim. Terminal Growth Rate Prelim. Terminal Growth Rate 2.5% 2.0% 1.5% 2.5% 2.0% 1.5% 2.5% 2.0% 1.5% 5.7x 5.4x 5.1x 6,375 6,128 5,913 3,858 3,611 3,396 2,517 9.00% Discou nt Rate 5.3x 5.0x 4.8x 5,913 5,709 5,530 = 3,446 3,241 3,063 + 2,467 9.50% 5.0x 4.7x 4.5x 5,513 5,343 5,192 3,094 2,923 2,773 2,419 10.00% % Premium to Current Equity Value Per Share 2 A + B + C Equity Value C Net Debt 1 Prelim. Terminal Growth Rate Prelim. Terminal Growth Rate Prelim. Terminal Growth Rate 2.5% 2.0% 1.5% 2.5% 2.0% 1.5% 2.5% 2.0% 1.5% 19.1% 12.6% 7.0% 27.32 25.82 24.52 4,515 4,268 4,053 (1,860) 9.00% Discou nt Rate 6.9% 1.6% (3.2%) 24.52 23.29 22.20 4,053 3,849 3,670 (1,860) 9.50% (3.6%) (8.1%) (12.1%) 22.10 21.07 20.16 3,653 3,483 3,332 (1,860) 10.00% 10
C O N F I D E N T I A L P R O J E C T N A V Y Selected Trading Multiples Source: Company public filings, Factset as of December 09, 2024 Note: Calendarized to 01/31 FYE; EBITDA figures for European companies adjusted from IFRS to GAAP basis; 1 Represents Macy’s effected share price and multiple (For Reference Only) (For Reference Only) (For Reference Only) Dividend P / E FV / EBITDA FV / Revenue Firm Equity % 52 - Share Yield 2026E 2025E 2026E 2025E 2026E 2025E Value Value Wk High Price $mm, calendarized to 01/31 Based on consensus figures 3.3% 10.9x 11.3x 5.2x 5.3x 0.4x 0.4x $6,315 $4,022 91.8% $22.93 Nordstrom Department Stores 4.2% 6.2x 6.3x 3.8x 3.6x 0.3x 0.3x $7,135 $4,782 75.7% $16.72 Macy’s 1 13.1% 9.9x 10.9x 5.1x 5.3x 0.4x 0.4x $6,489 $1,774 51.6% $15.26 Kohl's 0.2% 19.0x 14.3x 11.2x 9.3x 1.0x 1.0x $6,365 $6,952 91.7% $437.14 Dillard's 5.8% 11.7x 10.5x 6.7x 6.1x 0.6x 0.6x 73.0% Mean 4.2% 9.9x 10.9x 5.1x 5.3x 0.4x 0.4x 75.7% Median Off - Price – (For Reference Only) 1.2% 24.7x 27.5x 16.4x 17.9x 2.3x 2.4x $142,327 $144,180 98.4% $125.90 TJX 0.9% 21.5x 23.3x 14.3x 15.4x 2.1x 2.2x $50,309 $52,445 95.5% $156.24 Ross Stores NA 25.4x 30.4x 13.8x 16.3x 1.6x 1.7x $20,400 $19,545 97.5% $291.34 Burlington 1.1% 23.9x 27.1x 14.8x 16.5x 2.0x 2.1x 97.1% Mean 1.1% 24.7x 27.5x 14.3x 16.3x 2.1x 2.2x 97.5% Median Online Retail – (For Reference Only) NA 22.4x 26.8x 9.6x 10.7x 0.7x 0.7x $8,165 $9,786 99.8% $36.75 Zalando NA NA 44.8x 22.7x 29.1x 1.8x 2.0x $2,458 $2,710 92.7% $36.19 Revolve Group NA 20.3x 21.1x 7.2x 18.0x 0.5x 0.6x $576 $559 78.0% $6.43 MYTE NA 21.4x 30.9x 13.2x 19.3x 1.0x 1.1x 90.2% Mean NA 21.4x 26.8x 9.6x 18.0x 0.7x 0.7x 92.7% Median 11
C O N F I D E N T I A L P R O J E C T N A V Y Selected Operating Multiples Source: Company public filings, Factset as of December 09, 2024 Note: Calendarized to 01/31 FYE; EBITDA figures for European companies adjusted from IFRS to GAAP basis Leverage Ratios 2025E Capex EBITDA Gross Profit Revenue Total Debt Adj. Debt % 2025E Sales 2024E - 2026E CAGR % Margin 2025E % Margin 2025E 2024E - 2026E CAGR 2025E $mm, calendarized to 01/31 Based on consensus figures 2.3x 2.1x 3.5% (2.6%) 7.9% $1,178 36.7% $5,461 2.3% $14,863 Nordstrom Department Stores 1.0x 1.7x 3.9% (4.0%) 9.1% $1,975 39.8% $8,668 (0.5%) $21,779 Macy's 2.3x 3.3x 3.0% 1.6% 7.8% $1,233 35.7% $5,615 2.0% $15,714 Kohl's 0.5x 0.5x 1.9% (19.9%) 10.4% $681 41.1% $2,694 (2.8%) $6,560 Dillard's 1.2x 1.8x 2.9% (7.4%) 9.1% 38.9% (0.4%) Mean 1.0x 1.7x 3.0% (4.0%) 9.1% 39.8% (0.5%) Median Off - Price – (For Reference Only) 0.3x 1.1x 3.4% 9.3% 13.4% $7,951 30.5% $18,137 5.9% $59,424 TJX 0.7x 1.4x 3.7% 8.6% 14.6% $3,270 28.1% $6,290 5.9% $22,414 Ross Stores 1.2x 2.3x 7.0% 17.4% 10.7% $1,251 43.4% $5,067 9.6% $11,682 Burlington 0.8x 1.6x 4.7% 11.8% 12.9% 34.0% 7.1% Mean 0.7x 1.4x 3.7% 9.3% 13.4% 30.5% 5.9% Median Online Retail – (For Reference Only) 0.8x 1.7x 2.6% 12.4% 6.5% $760 40.0% $4,708 5.7% $11,766 Zalando 0.0x 0.7x 0.4% 30.5% 6.9% $84 52.6% $640 9.6% $1,216 Revolve Group 15.8x 11.4x 0.8% NA 3.1% $32 47.5% $483 8.0% $1,018 MYTE 5.5x 4.6x 1.3% 21.4% 5.5% 46.7% 7.8% Mean 0.8x 1.7x 0.8% 21.4% 6.5% 47.5% 8.0% Median (For Reference Only) 12
C O N F I D E N T I A L P R O J E C T N A V Y Selected US Department Stores Transaction Multiples 9.1x 10.0x 5.0x 5.6x 6.0x 10.3x 10.0x 7.9x 10.7x 11.8x 10.7x 9.3x 9.0x 6.6x August 2015 June 2015 September 2013 July 2013 July 2013 October 2016 May 2015 February 2015 January 2014 May 2021 March 2021 June 2017 November 2015 December 2014 Ann. Date Divine Investments SA Acquirer Target FV / LTM EBITDA Median: 10.2x Median: 9.3x Median: 6.0x (For Reference Only) Source: Company public filings, equity research, FactSet 13
C O N F I D E N T I A L P R O J E C T N A V Y Agenda Page 2 Nordstrom Overview 1 5 Navy Valuation 2 14 Appendix 3
C O N F I D E N T I A L P R O J E C T N A V Y Analyst Price Target And Recommendations (For Reference Only) Implied return Target price 1 (US$) Target price date Recommendation Broker 13.4% $26.00 November 27 th , 2024 Hold Broker 1 9.0% $25.00 November 27 th , 2024 Hold Broker 2 6.4% $24.40 December 2 nd , 2024 Hold Broker 3 (8.4%) $21.00 November 26 th , 2024 Sell Broker 4 (4.1%) $22.00 November 28 th , 2024 Hold Broker 5 0.3% $23.00 November 26 th , 2024 Hold Broker 6 (4.1%) $22.00 November 26 th , 2024 Hold Broker 7 9.0% $25.00 November 27 th , 2024 Hold Broker 8 (36.8%) $14.50 November 26 th , 2024 Sell Broker 9 (4.1%) $22.00 November 26 th , 2024 Sell Broker 10 4.7% $24.00 November 27 th , 2024 Hold Broker 11 0.3% $23.00 November 26 th , 2024 Hold Broker 12 0.3% $23.00 Median 1 NORDSTROM - ANALYSTS TARGETS AND RATINGS BROKER COMMENTARY Source: Company public filings, CFIT, Factset as of December 09, 2024 Note: 1 Includes broker estimates not listed “We are encouraged by ongoing momentum in the business, with stronger sales and comp momentum across banners . Further, we were pleased to see product initiatives contribute to stronger full - price sell through… this is balanced by a continued overall lack of leverage in the company’s profitability , where full year operating margin expansion has remained rangebound despite stronger sales momentum.” Broker A, November 27, 2024 “While we recognize an uncertain macro environment, inflationary pressures on the low - income consumer, and merchandising challenges , we believe occasion - based categories should continue to perform well. We continue to favor [Nordstrom’s] off - price, digital, and local market strategy in addition to brand offerings.” Broker B, November 27, 2024 “Longer - term, we remain EW rated, balancing our cautious view on the department store channel against the potential for continued sales acceleration at [Nordstrom] driving operating margin leverage off of multi - year trough levels, as well as the potential for a take - private transaction.” Broker C, November 26, 2024 25% 50% 75% 100% Analyst ratings $15 $18 $21 $27 Price $23.00 $22.93 0% Jan - 24 Mar - 24 May - 24 SELECTED ANALYST RECOMMENDATIONS Aug - 24 Oct - 24 Dec - 24 14
C O N F I D E N T I A L P R O J E C T N A V Y This presentation (the “Valuation Report”) was prepared exclusively for the benefit and internal use of the senior management and board of directors of El Puerto de Liverpool S.A.B. de C.V. (the “Company”) to whom it is directly addressed and delivered in connection with the Transaction (as defined below) and does not carry any right of publication or disclosure, in whole or in part, to any other party. JP Morgan has been retained by the Company to act as financial advisor to the Company in connection with a potential acquisition of Nordstrom, Inc. (together with its subsidiaries and affiliates, the “Counterparty”) (the “Transaction”). This Valuation Report is for discussion purposes only and is incomplete without reference to, and should be viewed solely in conjunction with, the oral briefing provided by JPMorgan. In arriving at our view, we have (i) reviewed certain publicly available business and financial information concerning the Counterparty and the industries in which it operates; (ii) reviewed the publicly available financial terms of certain transactions involving companies we deemed relevant and the consideration received for such companies; (iii) compared the financial and operating performance of the Counterparty with publicly available information concerning certain other companies we deemed relevant and reviewed the current and historical market prices of the Counterparty’s common stock and certain publicly traded securities of such other companies; (iv) reviewed certain internal financial analyses and forecasts prepared by the management(s) of the Company relating to the Counterparty's business; and (v) performed such other financial studies and analyses and considered such other information as we deemed appropriate for the purposes of this Valuation Report. In addition, we have held discussions with certain members of the management of the Counterparty and the Company with respect to the past and current business operations of the Counterparty, the financial condition and future prospects and operations of the Counterparty, and certain other matters we believed necessary or appropriate to our inquiry. The information in this Valuation Report is based upon management forecasts supplied to us and reflects prevailing conditions and our views as of this date, all of which are accordingly subject to change. JPMorgan’s opinions and estimates constitute JPMorgan’s judgment and should be regarded as indicative, preliminary and for illustrative purposes only. In preparing this Valuation Report, we have relied upon and assumed, without assuming responsibility or liability for independent verification, the accuracy and completeness of all information that was publicly available or was furnished to or discussed with us by the Company or otherwise reviewed by or for us. We have not conducted or been provided with any valuation or appraisal of any assets or liabilities, nor have we evaluated the solvency of the Counterparty under any state or federal laws relating to bankruptcy, insolvency or similar matters. In relying on financial analyses and forecasts provided to us, we have assumed that they have been reasonably prepared based on assumptions reflecting the best currently available estimates and judgments by management as to the expected future results of operations and financial condition of the Counterparty to which such analyses or forecasts relate. We express no view as to such analyses or forecasts or the assumptions on which they were based. Actual future results may differ significantly from those suggested in the Valuation Report. Our view is necessarily based on economic, market and other conditions as in effect on, and the information made available to us as of, the date hereof. It should be understood that subsequent developments may affect our view expressed herein and that we do not have any obligation to update, revise, or reaffirm this view. This Valuation Report does not constitute an opinion as to the fairness, from a financial point of view or otherwise, of the terms of any Transaction, including the consideration to be paid by the Company in any such Transaction, a valuation opinion and we express no view as to the underlying decision by the Company to engage in any such Transaction. We are expressing no view herein as to the price at which the Counterparty’s common stock will trade at any future time. We will receive a fee from the Company for the delivery of the Valuation Report. In addition, the Company has agreed to indemnify us for certain liabilities arising out of our engagement. In the ordinary course of our businesses, we and our affiliates may actively trade the debt and equity securities or financial instruments (including derivatives, bank loans or other obligations) of the Counterparty for our own account or for the accounts of customers and, accordingly, we may at any time hold long or short positions in such securities or other financial instruments. The Valuation Report is provided solely for the benefit of the senior management and the board of directors of the Company in connection with and for the purposes of its evaluation of the Transaction, and is not on behalf of, and shall not confer rights or remedies upon, any shareholder, creditor or any other person other than the board of directors of the Company or be used or relied upon for any other purpose. This Valuation Report may not be disclosed, referred to, or communicated (in whole or in part) to any third party for any purpose whatsoever except with our prior written approval. JPMorgan did not conduct any accounting, financial, legal, tax or any type of audit or due diligence of the Company, its affiliates, the Counterparty or of any third parties. Notwithstanding anything herein to the contrary, the Company and each of their respective employees, representatives or other agents may disclose to any and all persons, without limitation of any kind, the U . S . federal and state income tax treatment and the U . S . federal and state income tax structure of the transactions contemplated hereby and all materials of any kind (including opinions or other tax analyses) that are provided to the Company relating to such tax treatment and tax structure insofar as such treatment and/or structure relates to a U . S . federal or state income tax strategy provided to the Company by JPMorgan . JPMorgan’s policies prohibit employees from offering, directly or indirectly, a favorable research rating or specific price target, or offering to change a rating or price target, to a subject company as consideration or inducement for the receipt of business or for compensation. JPMorgan also prohibits its research analysts from being compensated for involvement in investment banking transactions except to the extent that such participation is intended to benefit investors. IRS Circular 230 Disclosure: JPMorgan Chase & Co. and its affiliates do not provide tax advice. Accordingly, any discussion of U.S. tax matters included herein (including any attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing or recommendation by anyone not affiliated with JPMorgan Chase & Co. of any of the matters addressed herein or for the purpose of avoiding U.S. tax - related penalties. JPMorgan is a marketing name for investment banking businesses of JPMorgan Chase & Co. and its subsidiaries worldwide. Securities, syndicated loan arranging, financial advisory and other investment banking activities are performed by a combination of J.P. Morgan Securities LLC, J.P. Morgan plc, J.P. Morgan Securities Ltd. and the appropriately licensed subsidiaries of JPMorgan Chase & Co. in Asia - Pacific, and lending, derivatives and other commercial banking activities are performed by JPMorgan Chase Bank, N.A. JPMorgan deal team members may be employees of any of the foregoing entities.
Exhibit 16(d)(iv)
COOPERATION AGREEMENT
This Cooperation
Agreement (the “Agreement”) is made as of December 22, 2024 (the “Effective Date”) by and among
Norse Holdings, Inc., a Delaware corporation (“Parent”), El Puerto de Liverpool, S.A.B. de C.V., a Mexican corporation
(sociedad anónima bursátil) (“Liverpool”), and each of the Persons set forth under the heading
“Family Members” on the signature pages hereto (each a “Family Member” and collectively the “Family
Members” and the Family Members together with Liverpool, the “Investors”, with each an “Investor”).
Capitalized terms used herein without definition shall have the respective meanings set forth in the Merger Agreement.
RECITALS
1. Parent
desires to enter into the definitive agreement attached hereto as Exhibit A for the merger (the “Merger”) of
Navy Acquisition Co. Inc., a Washington corporation and wholly-owned direct subsidiary of Parent, with and into Nordstrom, Inc., a Washington
corporation (the “Company”), with the Company surviving such merger (the “Merger Agreement”).
2. Concurrently
herewith, Liverpool is executing a letter agreement in favor of Parent, pursuant to which Liverpool shall agree, subject to the terms
and conditions set forth therein and in accordance with the equity and governance term sheet attached hereto as Exhibit B (the
“Equity and Governance Term Sheet”), to make a specified investment in Parent pursuant to the terms of the equity commitment
letter attached hereto as Exhibit C (the “Liverpool ECL”).
3. Liverpool’s
investment in Parent under the Liverpool ECL will be comprised of up to $931 million in the form of a common equity investment in Parent
and up to $781 million in the form of a loan to Parent (the “Parent Loan”), which loan shall be subject to the terms
and conditions set forth in the term sheet attached hereto as Exhibit D (the “Parent Loan Term Sheet Letter”).
4. Concurrently
herewith, each of the Family Members and Liverpool is executing a rollover, voting and support agreement with the Company, pursuant to
which Liverpool and each of the Family Members has agreed to (a) vote their shares of common stock and any other voting securities of
the Company in favor of the Merger Agreement and the transactions contemplated thereby, and take or abstain from taking certain other
actions and (b) contribute a specified number of shares of Common Stock of the Company to Parent, in each case, pursuant to the terms
and subject to the conditions set forth in the Rollover, Voting and Support Agreements attached hereto as Exhibit E-1 and Exhibit
E-2, respectively (the “Rollover, Voting and Support Agreements”).
5. Concurrently
herewith, Liverpool is executing a limited guaranty in favor of the Company, pursuant to which Liverpool shall guarantee to the Company
payment if and when due of an amount equal to 50% of the Reverse Termination Fee payable by Parent to Company pursuant to Section 8.3(b)
of the Merger Agreement and the other obligations set forth therein, pursuant to the terms and subject to the conditions set forth in
the Limited Guaranty Agreement attached hereto as Exhibit F (the “Liverpool Limited Guaranty Agreement”).
6. Concurrently
herewith, each Family Guarantor (as defined below) is executing a limited guaranty in favor of the Company, pursuant to which each Family
Guarantor shall guarantee to the Company payment if and when due of an amount equal to his, her or its respective Family Pro Rata Portion
of 50% of the Reverse Termination Fee payable by Parent to Company pursuant to Section 8.3(b) of the Merger Agreement and the other obligations
set forth therein, in each case pursuant to the terms and subject to the conditions set forth in the Family Member Limited Guaranty Agreement
attached hereto as Exhibit G (the “Family Member Limited Guaranty Agreement,” and together with the Liverpool
Guaranty Agreement, the “Limited Guaranty Agreements”).
The Investors
and Parent wish to agree to certain terms and conditions that will govern the actions of Parent and the relationship among the Investors
with respect to the Merger Agreement, the Merger, the Liverpool ECL, the Rollover, Voting and Support Agreements and the Limited Guaranty
Agreements.
AGREEMENT
Therefore, the parties hereto hereby
agree as follows:
1. EFFECTIVENESS.
This Agreement shall
become effective on the date hereof and shall terminate (except with respect to Sections 1, 2.2, 2.5.3, 2.6, 2.9, 2.11, 2.12
and Articles 3 (Definitions) and 4) upon the earlier of (a) the closing of the Merger under the Merger Agreement (the
“Closing”), and (b) the termination of the Merger Agreement in accordance with its terms; provided,
that any obligation or liability resulting from failure to comply with the terms of this Agreement shall survive such termination
and any provisions hereof reasonably related to any obligations of Parent that survive the termination of the Merger Agreement and
other Transaction Documents shall survive the termination of this Agreement if terminated under the foregoing clause (b).
2. AGREEMENTS AMONG THE INVESTORS.
2.1 Actions
Related to Merger Agreement. Subject to the terms and conditions of this Agreement and the Merger Agreement, during the period during
which this Agreement shall be effective until such time as either Liverpool or any Family Guarantor becomes a Non-Funding Investor, Liverpool
and the Family Representatives shall jointly administer the operations of Parent and shall use their respective reasonable best efforts
to cause Parent to comply with its obligations under the Merger Agreement, including satisfying the conditions to the closing obligations
of the Company pursuant to the Merger Agreement and exercising its rights under the Merger Agreement. Any Material Decision of Parent
that is to be taken or refrained from being taken in connection with the transactions contemplated by the Merger Agreement shall require
joint prior approval from Liverpool and the Family Representatives. A “Material Decision” is a decision that Parent
must make in connection with the transactions contemplated by the Merger Agreement, which material decisions shall include, without limitation:
(a) determining whether or not the conditions to Closing set forth in Article VII of the Merger Agreement have been satisfied or properly
waived; (b) exercising (or not exercising) the right to terminate the Merger Agreement or not affect the Closing if one or more of
the conditions to the closing obligations of Parent pursuant to the Merger Agreement have not been satisfied (the “Purchaser
Closing Conditions”); (c) any increase or decrease in the amount of, or any change in the form of, merger consideration,
dividends or other payment obligations contained in the Merger Agreement; (d) any change to the structure of the transactions contemplated
by or to be pursued in connection with the Merger and the structure of Parent’s investment in the Company, including the elements
of the structure described in Section 4.8 hereof; (e) any waiver of compliance by the Company or any of its Subsidiaries with
any of its representations, warranties or covenants
contained in the Merger Agreement (including any timeframe by which the Company is required to comply with an action set forth in the
Merger Agreement); (f) any other amendment, change or waiver to any provision of the Merger Agreement or a modification to any material
term of the Financing; (g) determining whether or not to conduct any Company Note Offers and Consent Solicitations, including whether
or not to initiate, its timing, duration, terms and conditions to consummation, the waiver of any conditions and any other decision with
respect to thereto or the Senior Notes, including whether to seek or effectuate their refinancing; and (h) controlling, directing
and settling any stockholder-related suit, claim or proceeding arising in connection with the transactions contemplated by the Merger
Agreement. Any decision that Parent must make in connection with the Liverpool ECL, Limited Guaranty Agreements or the Rollover, Voting
and Support Agreements to which it is a party shall be made by Liverpool or the Family Representatives that is not a party to such agreement
(i.e. any decision of Parent with respect to the Liverpool ECL, Liverpool Limited Guaranty or the Rollover, Voting and Support
Agreement executed by Liverpool shall be made by the Family Representatives and any decision of Parent with respect to the Family Member
Limited Guaranty Agreement or any Rollover, Voting and Support Agreement executed by any Family Member shall be made by Liverpool).
2.2 Breach
of Commitment. If, following satisfaction or waiver of the Purchaser Closing Conditions, any Investor: (a) is unable or
unwilling to comply with its obligations upon the Closing as required by the terms of the Liverpool ECL or the Rollover, Voting and
Support Agreements to which it is a party, (b) fails upon request of (i) the Family Representatives (in the case of Liverpool) or
(ii) Liverpool (in the case of any Family Member), as applicable, to confirm promptly in writing its ability and willingness to
comply timely with its obligations in accordance with the Liverpool ECL or the Rollover, Voting and Support Agreements to which it
is a party, and/or (c) does not timely comply with its obligations pursuant to the Liverpool ECL or the Rollover, Voting and Support
Agreements to which is it is a party as required by the terms of such Liverpool ECL or such Rollover, Voting and Support Agreements,
as applicable, then in any such case, such Investor shall be deemed a “Non- Funding Investor” and (i) the Family
Representatives, if Liverpool is the Non-Funding Investor, or (ii) Liverpool, if any Family Member is the Non- Funding Investor, may
elect on behalf of Parent, to (A) terminate the participation of the Non-Funding Investor in the transactions contemplated by the
Merger Agreement by written notice at any time (provided that the remedy in this clause (A) may only be exercised by Liverpool (in
the event any Family Member is the Non-Funding Investor) and not by the Family Representatives (in the event Liverpool is the
Non-Funding Investor) or (B) obtain specific performance of such Non-Funding Investor’s obligations under the Liverpool ECL or
the Rollover, Voting and Support Agreements, as may be applicable, together with recovery from such Non-Funding Investor of all
costs incurred by Parent and Family Representatives (on behalf of the Family Members) or Liverpool, as may be applicable, in seeking
such specific performance, provided that upon compliance with such specific performance and cost recovery, such Non-Funding
Investor shall receive the benefits of such Liverpool ECL and Rollover, Voting and Support Agreements, as may be applicable, and of
this Agreement.
2.3 Debt
Financing. The Investors shall use their commercially reasonable efforts to cause Parent to, and, if applicable, shall use their commercially
reasonable efforts to cause the Company to, enter into and borrow under the definitive agreements relating to the debt financing to be
provided at the Closing substantially on the terms set forth on Exhibit H hereto as may be amended with the unanimous prior written
consent of Liverpool and the Family Representatives (the “Financing”). For the avoidance of doubt, the Financing may
not be terminated and the terms thereof may not be amended or modified without the unanimous prior written consent of Liverpool and the
Family Representatives.
2.4 Common
Equity and Parent Loan Documentation. Liverpool and the Family Representatives agree to negotiate in good faith with each other such
that the Investors may enter into, concurrently with the Closing, (a) the certificate of incorporation, bylaws and stockholders agreement
of Parent prior to the consummation of the transactions contemplated by the Merger Agreement, (b) the certificate of incorporation, bylaws
and stockholders agreement of the surviving corporation following Parent’s contemplated merger with the Company with respect to
their common equity interests in Parent reflecting the terms set forth in the Equity and Governance Term Sheet and (c) the documentation
necessary or advisable to document the Parent Loan and deliver and perfect any collateral contemplated thereby, in accordance with the
Parent Loan Term Sheet.
2.5 Commitments; Rollover, Voting and Support.
2.5.1 Each
of the Family Members and Liverpool hereby affirms and agrees that (a) it intends to be bound by the provisions set forth in the Liverpool
ECL and the Rollover, Voting and Support Agreements to which it is a party and (b) Parent, acting at the direction of the Investors (unless
(i) Liverpool is at such time a Non-Funding Investor, in which case, Parent shall act at the direction of the Family Representatives or
(ii) any Family Member is at such time a Non-Funding Investor, in which case, Parent shall act at the direction of Liverpool), shall be
entitled to enforce the provisions of the Liverpool ECL and the Rollover, Voting and Support Agreements, as may be applicable, but only
if either (y) the conditions to perform under the Commitments, as applicable, (other than any conditions related to a failure of an Investor
to perform its respective commitments under such documents) are satisfied or have been waived by the applicable Investor seeking to enforce
such commitments, or (z) the Company is permitted to enforce the provisions of the Liverpool ECL or the Rollover, Voting and Support Agreements,
as applicable, under the specific circumstances and as specifically set forth therein and Section 9.12 of the Merger Agreement and does
in fact so enforce, or cause Parent to enforce such provisions. None of the Investors or Parent shall attempt to enforce, or cause Parent
to enforce, any of the Liverpool ECL or Rollover, Voting and Support Agreements unless and until the conditions set forth in items (y)
or (z) of this Section 2.5.1 have been satisfied.
2.5.2 Each
of the Family Members and Liverpool shall comply with the terms of the Rollover, Voting and Support Agreement to which it is a party and
notwithstanding any other provision of this Agreement, compliance by the Family Members and Liverpool with the terms of the Rollover,
Voting and Support Agreement shall not, in and of itself, be deemed to violate this Agreement or any representation, warranty, covenant
or other provision herein.
2.5.3 Each
Family Guarantor and Liverpool shall comply with the terms of the Limited Guaranty Agreements to which it is a party and notwithstanding
any other provision of this Agreement, compliance by the Family Members or Liverpool with the terms of such Limited Guaranty Agreements
shall not, in and of itself, be deemed to violate this Agreement or any representation, warranty, covenant or other provision herein.
Each of the Investors shall cooperate in the defense of any claim with respect to which the Investors are or any of them is, or is alleged
to be, liable to make payments under the Limited Guaranty Agreements, without such cooperation being construed to create joint and several
liability as between Liverpool on the one hand and any Family Member on the other. For the avoidance of doubt, but subject to Section
2.12, (x) Liverpool shall not be required to make any contribution with respect to any amount paid or payable under the Family Member
Guaranty Agreement and (y) no Family Member shall be required to make any contribution with respect to any amount paid or payable under
the Liverpool Guaranty Agreement.
2.5.4 Prior
to the Closing, none of any Family Member or Liverpool shall transfer, directly or indirectly, its rights or obligations under the Liverpool
ECL or any Rollover, Voting and Support Agreement to which it is a party, other than: (a) a transfer permitted as provided for in the
applicable Liverpool ECL or Rollover, Voting and Support Agreement (including by operation of law in the event of the death of a Family
Member); (b) with respect to a Family Member, a transfer to a transferee of common stock of the Company in a permitted transfer under
the Rollover, Voting and Support Agreement or the NDA-Standstill Agreement; and (c) a transfer approved by (i) Liverpool, in the
case of any transfer by any Family Member, or (ii) Family Representatives, in the case of any transfer by Liverpool, provided, in each
case, that the transferee shall be bound by the provisions of this Agreement applicable to the transferor.
2.6 Merger Agreement Payments.
2.6.1 Parent
shall, and the Investors shall use their reasonable best efforts to cause Parent to, arrange that any termination fee or other payment
due to Parent as a result of the termination of or non-performance under the Merger Agreement paid by the Company or any of its affiliates
(other than the Investors) pursuant to the Merger Agreement (a “Company Termination Payment”) shall be promptly distributed
as follows; provided that an Investor whose participation in the transactions contemplated by the Merger Agreement has been terminated
pursuant to Section 2.2 hereof shall not be entitled to receive any portion of the Company Termination Payment:
(a) First,
reimbursement to Parent and, after such reimbursement, to each Investor of all out-of-pocket costs and expenses paid or payable in connection
with (i) its due diligence review of the Company, (ii) the Rating Evaluation Service review with S&P Global Ratings and the Rating
Assessment Service with Moody’s and Fitch, (iii) the negotiation, delivery and execution of this Agreement, the Liverpool ECL, the Rollover,
Voting and Support Agreements, the Limited Guaranty Agreements and the Merger Agreement and the other agreements and documents contemplated
hereby or thereby or entered into in connection herewith or therewith, and (iv) any actions taken in accordance with the terms of this
Agreement, the Liverpool ECL, the Rollover, Voting and Support Agreements, the Limited Guaranty Agreements and the Merger Agreement and
the other agreements and documents contemplated hereby or thereby or entered into in connection herewith or therewith, including regulatory
filings made or to be made pursuant to the Merger Agreement, including, without limitation, filing fees, the reasonable fees, expenses
and disbursements of attorneys, accountants, financial advisors, consultants and other advisors retained by the Investors or Parent incurred
in connection with the foregoing (collectively, the “Expenses”); and
(b) Second,
distribution of the balance of the Company Termination Payment to each Family Member in accordance with each Family Member’s pro
rata ownership of the Company (to an account designated by the Family Representatives for their distribution to the Family Members) and
to Liverpool in accordance with their respective Pro Rata Portions.
2.6.2 Notwithstanding
the foregoing, if the aggregate amount of Expenses incurred by the Investors (the “Aggregate Expenses”) exceeds the
amount of the Company Termination Payment received by Parent from the Company (the “Company Reimbursement Amount”),
each Investor shall be entitled to receive a portion of the Company Reimbursement Amount equal to the proportion that the Expenses incurred
by such Investor represent of the Aggregate Expenses.
2.6.3
In the event that a Reverse Termination Fee or any Additional Obligations become payable to the Company by Parent pursuant to the terms
and conditions of the Merger Agreement (“Parent MGA Payment”) and (a) Liverpool, on the one hand, or any Family Member, on
the other hand (any such Person, for purposes of this Section 2.6.3, a “Triggering Person”), has become a Non-Funding
Investor or (b) a Triggering Person determines that it does not intend to fulfill its Commitments upon the Closing because the Triggering
Person has concluded that one or more of the Purchaser Closing Conditions have not been satisfied and, in the case of Liverpool being
the Triggering Person, the Family Representatives (here, the “Non-Triggering Person”), or in the case of the Family
Representatives making such determination, Liverpool (here, the “Non-Triggering Person”) disagreed with such conclusion
(as evidenced in writing to the Triggering Person) and it is later determined by a court of competent jurisdiction that such Purchaser
Closing Condition(s) had been satisfied at the time that the Triggering Person claimed that such Purchaser Closing Condition(s) had not
been satisfied, then, in addition to all other remedies provided for herein, the Triggering Person shall be required to pay all the Expenses
the Non-Triggering Person incurred.
2.7 Information.
Parent shall keep Liverpool and the Family Representatives informed, on a current basis, of developments relating to the Merger, including
the likely Closing Date. If Parent receives any notice under the Merger Agreement, Parent shall promptly notify Liverpool and the Family
Representatives. Each of Liverpool, on the one hand, and Family Representatives, on the other hand, agrees to promptly communicate to
the other any information it becomes aware of which is material or would reasonably be expected to be material in the context of the Merger
Agreement, the transactions contemplated thereby and the due diligence being conducted in connection therewith, provided that each of
Liverpool, on the one hand, and Family Representatives, on the other hand, shall not be required to communicate such information where
it is not permitted to disclose such information as a result of any fiduciary or similar duties or any confidentiality obligation owed
to any third party that is not an Affiliate.
2.8 Regulatory
Matters. Each of Liverpool, on the one hand, and Family Representatives, on the other hand, shall work together in good faith to determine
the filings that are required by applicable antitrust, competition, foreign investment, fair trade, “know your customer,”
anti-money laundering or anti-bribery laws or regulations or other applicable laws or regulations relating to or in connection with the
transactions contemplated hereby (“Regulatory Laws”). Subject to appropriate confidentiality undertakings, each of
Liverpool, on the one hand, and Family Representatives, on the other hand, undertakes to provide all information reasonably necessary
to assess whether any filings or notifications are required under any Regulatory Laws, and if so, all information reasonably necessary
to complete and submit such filings and notifications in accordance with Regulatory Laws.
2.9 Expense Responsibility.
2.9.1 Subject
to Section 2.2, Section 2.6.2, Section 2.6.3, Section 2.11 and Section 2.12, each of Liverpool, on the one hand,
and the Family Guarantors, on the other hand, shall be responsible for and bear 50% of the Expenses incurred by Parent in the event the
Closing does not occur; provided that, prior to the Closing, each Investor shall use its commercially reasonable efforts to cause
Parent not to incur any expenses other than those expressly set forth on Exhibit I-1.
2.9.2 Upon
the Closing of the Merger, the Investors shall cause the Company to reimburse each Investor for all Expenses paid or payable through the
Closing by such Investor, including, without limitation, the fees and expenses of the advisors as set forth on Exhibit I-2 (and,
for the avoidance of doubt, if upon the Closing an Investor has not yet paid an applicable payee of Expenses the Expenses due to such
payee, then, in lieu of reimbursing the Investor for such Expenses, the Investor may direct the Company to pay the payee directly).
2.10 Appointment of Family Representatives.
2.10.1 Each
Family Member hereby irrevocably appoints the Family Representatives as the representative, attorney- in-fact and agent of such Family
Member, with full power of substitution to act in the name, place and stead of such Family Member in accordance with the terms and provisions
of this Agreement and to act on behalf of such Family Member in any amendment of this Agreement and to do or refrain from doing all such
further acts and things, and to execute all such documents, as the Family Representatives will deem necessary or appropriate in conjunction
with this Agreement, including the power:
(a) to
take all action reasonably necessary or desirable in connection with the obligations of such Family Member to consummate the transactions
contemplated by this Agreement (the “Transactions”);
(b) to defend, negotiate, settle and otherwise control claims in connection with this Agreement;
(c) to
give or agree to, on behalf of all or any Family Member, any and all consents, waivers, amendments or modifications deemed by the Family
Representatives, in their sole and absolute discretion, to be necessary or appropriate under this Agreement and the execution or delivery
of any documents that may be necessary or appropriate in connection therewith;
(d) to
dispute or refrain from disputing, on behalf of all or any Family Member, any claim made by Liverpool under this Agreement or any litigation
or arbitration involving this Agreement;
(e) to
negotiate and compromise, on behalf of such Family Member, any dispute that may arise under, and exercise or refrain from exercising any
remedies available under, this Agreement, and to execute, on behalf of each Family Member, any settlement agreement, release or other
document with respect to such dispute or remedy;
(f) to
engage attorneys, accountants, agents or consultants on behalf of the Family Members in connection with this Agreement and to pay any
fees related thereto;
(g) to
give and receive all notices and communications to be given or received under this Agreement and to receive service of process in connection
with any claims under this Agreement and the Transactions; and
(h) to
take all actions that, under this Agreement may be taken by or on behalf of any Family Member and to do or refrain from doing any further
act or deed on behalf of such Family Member that the Family Representatives deem necessary or appropriate in their sole discretion relating
to the subject matter of this Agreement as fully and completely as such Family Member could do if personally present.
2.10.2 The
Family Representatives will not be liable to the Family Members for any act taken or omitted by the Family Representatives as permitted
under this Agreement, except if such act is taken or omitted in bad faith or by material and intentional misconduct. The Family Representatives
will also be fully protected against Family Members in relying upon any written notice, demand, certificate or document that they or any
one of them in good faith believe to be genuine (including facsimiles thereof).
2.10.3
The Family Members agree to indemnify the Family Representatives for, and to hold the Family Representatives harmless against, any
loss, liability or expense incurred without willful misconduct or bad faith on the part of the Family Representatives, arising out
of or in connection with the Family Representatives’ carrying out their duties under this Agreement, including costs and
expenses of successfully defending the Family Representatives against any claim of liability with respect thereto. The Family
Representatives may consult with counsel of their own choice and will have full and complete authorization and protection for any
action taken and suffered by them in good faith and in accordance with the opinion
of such counsel.
2.10.4 The
Family Members agree that the agency described in this Section 2.10 is coupled with an interest, is irrevocable without the consent
of the Family Representatives and will survive the death, incapacity, bankruptcy, dissolution or liquidation of any Family Member. All
decisions and actions by the Family Representatives (to the extent authorized by this Agreement) will be binding upon all Family Members,
no Family Member will have the right to object, dissent, protest or otherwise contest the same.
2.10.5 In
furtherance, and not in limitation, of the foregoing provisions of this Section 2.10, each Family Member hereby provides the Family
Representatives with the power (including as representative, attorney-in-fact and agent, with full power of substitution to act in the
name, place and stead thereof) to similarly take such actions or refrain from taking such actions on behalf of such Family Member as provided
to the Family Representatives by the Family Members pursuant hereto.
2.10.6 Liverpool
shall be entitled to conclusively rely (without any verification or other inquiry) on any action or decision of the Family Representatives
(including any notice delivered to, or received from, the Family Representatives) taken or made hereunder.
2.11 Representations
and Warranties; Covenants. Each Investor hereby represents, warrants and covenants, severally as to itself only, to each other
Investor that:
2.11.1 Such
Investor (if not a natural person) is duly organized, validly existing, and in good standing (or equivalent status, if applicable) under
the laws of the jurisdiction in which it was formed. Such Investor has the right, full power, capacity and authority, as applicable, to
execute and deliver this Agreement and to perform his, her or its obligations hereunder.
2.11.2 The
execution, delivery, and performance of this Agreement by such Investor: (a) does not violate the charter or governance documents of such
Investor (if not a natural person), or any contract, agreement, commitment, lease, order, judgment, or decree to which such Investor is
a party; and (b) if not a natural person, has been duly authorized by the Investor and all necessary action has been taken by the
Investor’s board, managers, members, or other requisite governance bodies or persons, as applicable, has been taken for such authorization
to be effective.
2.11.3 This
Agreement is valid and binding upon such Investor, subject to bankruptcy, reorganization and other similar laws affecting the enforcement
of creditors’ rights generally.
2.11.4 If
such Investor is married, and any of the shares of common stock of the Company owned or otherwise held by such Investor constitute community
property or otherwise need spousal or similar consent for any Transaction Document to which such Investor is a party to be legal, valid
and binding, then such Transaction Document has been duly and validly authorized by all necessary spousal or community property action.
2.11.5
If the transactions contemplated by the Merger Agreement are consummated, such Investor shall use its commercially reasonable efforts
to cause the Company to enter into employment agreements with each of Erik Nordstrom, James F. Nordstrom, Jr. and Peter Nordstrom, inclusive
of the terms set forth on Exhibit B, and such other terms as may be mutually agreed between each of Erik Nordstrom, James F. Nordstrom,
Jr. and Peter Nordstrom, on the one hand, and Liverpool, on the other, and one or more management incentive plans containing the terms
and conditions as may be mutually agreed by the Family Representatives and Liverpool. For the avoidance of doubt, this Agreement (including
the terms set forth on Exhibit B) does not constitute, and in no event shall be deemed to constitute, an employment agreement
between any Investor or any of its current or future Affiliates (or, following consummation of the transactions contemplated by the Merger
Agreement, the Company), on the one hand, and any of Erik Nordstrom, James F. Nordstrom, Jr. or Peter Nordstrom, on the other hand.
2.11.6 To
the extent such Investor or Family Member is employed by or manages the Company or any of its Subsidiaries, subject to their fiduciary
duties under applicable Law based upon the advice of outside counsel, such Person in their role as a director, officer or employee of
the Company or its Subsidiaries, shall not take or cause the Company or its Subsidiaries to act or fail to act, in a manner that would
or would reasonably be expected to, cause a material inaccuracy in the Company’s representations and warranties in any Transaction
Document, a material breach of the Company’s covenants and agreements in any Transaction Document, a Below Investment Grade Rating
Event or a decrease in Company Cash on Hand below the Company Cash Amount.
2.12 Indemnification.
To the extent that any Parent MGA Payments become payable to the Company pursuant to the terms and subject to the conditions of the Merger
Agreement primarily as a result of either Liverpool’s, on the one hand, or any Family Member’s, on the other hand, breach
of its obligations under the Merger Agreement, the Liverpool ECL, the Limited Guaranty Agreements, the Rollover, Voting and Support Agreements,
any other Transaction Document or this Agreement, either Liverpool, on the one hand, or the Family Guarantors in accordance with the Family
Pro Rata Portion, on the other hand, if any Family Member is the breaching Investor (such breaching Investor, or the Family Members, in
the case of any breaching Family Member, the “Indemnifying Investor”), shall be solely responsible and liable for (and
in the case of the Family Members shall be severally and not jointly liable for) and shall indemnify and hold harmless either Liverpool,
on the one hand, or the Family Members, on the other hand, that is not an Indemnifying Investor and such Investor’s Affiliates (collectively,
the “Indemnified Investor Parties”) with respect to, and shall pay, the portion of the Parent MGA Payments and any
reasonable, documented out-of-pocket costs and expenses incurred by the Indemnified Investor Parties to the extent arising from such breach
(including any associated Expenses); provided, that the foregoing will not apply to any losses, damages or payments, as applicable,
of an Indemnified Investor Party to the extent found by a final non- appealable decision of a court of competent jurisdiction to have
resulted primarily from the gross negligence, bad faith, fraud or willful misconduct of such Indemnified Investor Party.
3. DEFINITIONS. For purposes of this Agreement, the following terms shall have the following meanings:
3.1 “Commitments”
mean the various commitments made by the parties hereto, including pursuant the Liverpool ECL, the Rollover, Voting and Support Agreements
and the Limited Guaranty Agreements, with each such commitment being a “Commitment”.
3.2 “Family Guarantor” means each of parties identified on Exhibit J hereto.
3.3
“Family Pro Rata Portion” means the percentage allocation ascribed to each Family Guarantor set forth on Exhibit
J hereto.
3.4 “Family
Representatives” means, at any time, at least two of Peter Nordstrom, Erik Nordstrom and James F. Nordstrom, Jr. (except for
any of the foregoing who is a Non-Funding Investor at such time).
3.5 “Funding
Investor” shall mean each Investor unless such Investor becomes a Non-Funding Investor, in which event such Investor shall have
none of the rights provided to a Funding Investor hereby.
3.6 “NDA-Standstill
Agreement” shall mean that Letter Agreement (as amended, supplemented and/or joined), dated April 17, 2024, by and among the
Company and each Family Member.
3.7 “Person”
shall mean any individual, partnership, corporation, trust, business trust, limited liability company, limited partnership, limited liability
partnership, joint stock company, trust, unincorporated association, joint venture, company or other entity.
3.8 “Pro
Rata Portion” means (a) with respect to Liverpool, 50%, and (b) with respect to Family Members, or Family Guarantors, as the
case may be collectively, 50%.
4. MISCELLANEOUS.
4.1 Amendment.
This Agreement may be amended or modified and the provisions hereof may be waived, only by an agreement in writing signed by Liverpool
and the Family Representatives.
4.2 Severability.
In the event that any provision hereof would, under applicable law, be invalid or unenforceable in any respect, such provision shall be
construed by modifying or limiting it so as to be valid and enforceable to the maximum extent compatible with, and possible under, applicable
law. The provisions hereof are severable, and in the event any provision hereof should be held invalid or unenforceable in any respect,
it shall not invalidate, render unenforceable or otherwise affect any other provision hereof.
4.3 Remedies.
Neither Parent nor any other party hereto will have the right to recover lost profits, diminution in value (including loss in value of
the common stock of the Company) or benefit of the bargain damages or any special, indirect, or consequential damages (other than recovery
of Expenses or costs as set forth in Section 2.2 or the Parent MGA Payments pursuant to Section 2.6.3 or the indemnification
obligations pursuant to Section 2.11) from any other party to this Agreement.
4.4 No
Recourse. Notwithstanding anything that may be expressed or implied in this Agreement, and notwithstanding the fact that Parent and
the Investors may be corporations, partnerships or limited liability companies, and trusts, Parent and each Investor covenants, agrees
and acknowledges that no recourse under this Agreement or any documents or instruments delivered in connection with this Agreement shall
be had against any former, current or future directors, officers, agents, affiliates, general or limited partners, members, managers,
trustees, trust beneficiaries or stockholders of Parent or any Investor or any former, current or future directors, officers, agents,
affiliates, employees, general or limited partners, members, managers, trustees, trust beneficiaries or stockholders of any of the foregoing,
as such, whether by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any statute, regulation
or other applicable law, it being expressly agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed
on or otherwise be incurred by any current or future director, officer, employee, general or limited partner or member, manager, trustee
or beneficiary of Parent or any Investor or of any partner, member, manager or affiliate thereof, as such, for any obligation of Parent
or any Investor under this Agreement or any documents or instruments delivered in connection with this Agreement for any claim based on,
in respect of or by reason of such obligations or their creation; provided, that for the avoidance of doubt, each Person that executes
this Agreement and thereby becomes a party to this Agreement shall be liable for its obligations under this Agreement as and to the extent
set forth herein.
4.5 Governing
Law; Jurisdiction; JURY WAIVER. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF DELAWARE APPLICABLE TO CONTRACTS EXECUTED IN AND TO BE PERFORMED IN THAT STATE. Each party hereto irrevocably and
unconditionally consents to submit to the exclusive personal jurisdiction of the state courts of the Delaware Court of Chancery, any
other court of the State of Delaware or any federal court sitting in the State of Delaware for such actions, suits or proceedings
arising out of or relating to this Agreement and the transactions contemplated hereby (and agrees not to commence any such action,
suit or proceeding except in such courts). Notwithstanding the foregoing, any party hereto may commence an action, suit or
proceeding with any governmental entity anywhere in the world for the sole purpose of seeking recognition and enforcement of a
judgment of any court referred to in the preceding sentence. Each party hereto irrevocably and unconditionally waives any objection
to the laying of venue of any action, suit or proceeding arising out of or relating to this Agreement and the transactions
contemplated hereby in state courts of the Delaware Court of Chancery, any other court of the State of Delaware or any federal court
sitting in the State of Delaware, and further waives the right to, and agrees not to, plead or claim that any such action, suit or
proceeding brought in any such court has been brought in an inconvenient forum. Service of any process, summons, notice or document
by U.S. registered mail to each party at the address set forth on the signature page hereto shall be effective service of process
for any action, suit or proceeding brought against such party in any court of competent jurisdiction. EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
4.6 Exercise
of Rights and Remedies. The parties hereto agree that no failure or delay by the other party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof
or the exercise of any other right, power or privilege hereunder. No party’s waiver of any right, power or privilege hereunder,
and a party’s consent to any action that requires its consent hereunder, shall be effective only if given in writing by such party.
4.7 Other
Agreements; Assignment. This Agreement, together with the agreements referenced herein, constitutes the entire agreement, and
supersedes all prior agreements, understandings, negotiations and statements, both written and oral, among the parties or any of their
affiliates with respect to the subject matter contained herein except for such other agreements as are referenced herein which shall continue
in full force and effect in accordance with their terms. Other than as provided herein, this Agreement shall not be assigned without the
prior written consent of the parties hereto.
4.8 Tax
Structure. Parent and each Investor shall cooperate to structure the contribution of the common stock of the Company to the Investors
pursuant to any Rollover, Voting and Support Agreements to which such Investors are a party shall on a tax deferred basis. Parent and
each Investor shall also cooperate to structure the merger transaction consistent with existing Internal Revenue Service and applicable
state rulings concluding that the creation of Parent followed by the merger of Acquisition Sub into the Company with the Investors exchanging
Company stock for Parent stock, and with the other shareholders of the Company receiving cash (the “Merger Transaction Tax Result”).
In addition, neither of the Parent nor any Investor may take any action to amend, modify or waive any provision of the Merger Agreement
or any related agreement (including this Agreement) if such amendment, waiver or modification would result in a material adverse change
in the ability of any Investor to contribute common stock on a tax deferred basis pursuant to any Rollover, Voting and Support Agreement
to which it is a party or fully realize the Merger Transaction Tax Result.
4.9 Press
Release; Communications. Liverpool and the Family Representatives will coordinate any and all notices, releases, statements,
communications to the general public or the press and any required filings, in each case, relating to this Agreement, the Merger Agreement,
the documents relating to the Financing or the transactions contemplated hereby or thereby. Such releases, statements, communications
and/or filings shall be made only at such times and in such manner as may be agreed upon by Liverpool and the Family Representatives;
provided, that Liverpool and the Family Representatives shall be entitled to issue such press releases and to make such public
statements as are required by applicable laws and regulations (including securities laws and regulations), in which case the other Investor
shall be advised thereof and Liverpool and the Family Representatives shall use their reasonable efforts to cause a mutually agreeable
release or announcement to be issued; provided, further, that to the extent practicable, any required filing shall be approved
by Liverpool and the Family Representatives, as applicable, with such approval not to be unreasonably withheld, conditioned or delayed
prior to the public disclosure thereof. Once and solely to the extent such information has been made available to the general public in
accordance with this Agreement, this Section 4.9 shall no longer apply to such information (other than in the case of any such
required filings, which shall to the extent practicable be subject to the prior approval of the Investors).
4.10 Non-Circumvention.
Each party hereto agrees that it shall not indirectly accomplish that which it is not permitted to accomplish directly under this Agreement.
4.11 No
Third Party Beneficiaries. The parties hereby agree that their hereby agree that their respective representations, warranties and
covenants set forth herein are solely for the benefit of the parties hereto and their respective successors and permitted assigns, and
nothing set forth in this Agreement shall be construed to confer upon or give to any Person, other than the parties hereto and their respective
successors and permitted assigns, any benefits, rights or remedies under or by reason of, or any rights to enforce the obligations set
forth herein.
4.12 General.
Nothing in this Agreement shall be deemed to constitute a partnership between any of the parties, nor constitute any part the agent of
any other party for any purpose. This Agreement may be executed in counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument. Notwithstanding anything in this Agreement to the contrary, in
no event shall the obligations of any party set forth in this Agreement convey to any other party or any other person voting power in
the election of directors of the Company, sole or shared ownership of any shares of common stock of the Company, or sole or shared power
to vote any shares of common stock of the Company or to direct the exercise of voting power of any such shares. For the convenience of
the parties, this Agreement may be executed by PDF, facsimile or other electronic means and in counterparts, each of which shall be deemed
to be an original, and both of which, taken together, shall constitute one agreement binding on both parties hereto.
[Signature Page Follows]
IN WITNESS WHEREOF, each of the undersigned has duly
executed this Agreement as of the date first above written.
| EL
PUERTO DE LIVERPOOL, S.A.B. DE C.V. |
| | |
| By: | /s/ Graciano
Francisco Guichard González |
| Name: | Graciano
Francisco Guichard González |
| Title: | Chairman
of the Board |
| | | |
| By: | /s/ Enrique
Güijosa Hidalgo |
| Name: | Enrique Güijosa
Hidalgo |
| Title: | Chief Executive
Officer |
| | | |
| Address: | [***] |
| Attention: | Gonzalo
Gallegos |
| | | Jacobo Apichoto |
| | | |
| Email: | [***] |
[Signature Page to Cooperation
Agreement]
IN WITNESS WHEREOF, each of the undersigned has duly executed this
Agreement as of the date first above written.
| |
NORSE HOLDINGS, INC. |
| |
|
|
| |
By: |
/s/ Erik B. Nordstrom |
| |
Name: |
Erik B. Nordstrom |
| |
Title: |
Co-Chief Executive Officer Address: |
| |
|
|
| |
c/o Norse Holdings,
Inc. |
| |
|
| |
1617 Sixth Avenue |
| |
|
| |
Seattle, WA 98101 |
[Signature Page
to Cooperation Agreement]
| ERIK B. NORDSTROM |
| | |
| /s/ Erik B. Nordstrom |
| Erik B. Nordstrom |
| | |
| Address: | [**] |
[Signature Page to Cooperation
Agreement]
| | JULIE A. NORDSTROM |
| | |
| /s/ Julie A. Nordstrom |
| Julie A. Nordstrom |
| | |
| | Address: | [**] |
[Signature Page to Cooperation
Agreement]
| | PETER F. NORDSTROM |
| | | |
| /s/ Peter F. Nordstrom |
| Peter E. Nordstrom |
| | |
| | Address: | [**] |
[Signature Page to Cooperation
Agreement]
| BRANDY F. NORDSTROM |
| | |
| /s/ Brandy
F. Nordstrom |
| Brandy F. Nordstrom |
| | |
| | Address: | [**] |
[Signature Page to Cooperation
Agreement]
| | JAMES F. NORDSTROM, JR. |
| | | |
| /s/ James F. Nordstrom,
Jr. |
| James F. Nordstrom, Jr. |
| | |
| | Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
KATHARINE T.
NORDSTROM 2007
TRUST AGREEMENT |
| |
|
|
| |
By:
|
/s/ James F. Nordstrom,
Jr. |
| |
Name: |
James F. Nordstrom, Jr. |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
JULIA K. NORDSTROM 2007
TRUST AGREEMENT |
| |
|
|
| |
By: |
/s/ James F.
Nordstrom, Jr. |
| |
Name: |
James F. Nordstrom, Jr. |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
AUDREY G. NORDSTROM 2007
TRUST AGREEMENT |
| |
|
|
| |
By: |
/s/ James F.
Nordstrom, Jr. |
| |
Name: |
James F. Nordstrom, Jr. |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
LISA NORDSTROM |
| |
|
|
| |
/s/ Lisa Nordstrom |
| |
Lisa Nordstrom |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
|
ANNE E. GITTINGER |
| |
|
|
/s/ Anne E. Gittinger |
|
Anne E. Gittinger |
| |
| |
| |
Address: | [**] |
[Signature Page to Cooperation
Agreement]
| | 1976 ELIZABETH J. NORDSTROM TRUST |
| FBO ANNE GITTINGER |
| | | |
| By: | /s/ Anne E. Gittinger |
| | Name: | Anne E. Gittinger |
| | Title: | Trustee |
| | | |
| Address: | [**] |
[Signature Page to Cooperation Agreement]
| |
ANNE E. GITTINGER TRUST |
| |
U/W EVERETT W. NORDSTROM |
| |
|
|
| |
By: |
/s/ Charles W. Riley, Jr. |
| |
Name: |
Charles W. Riley, Jr. |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
SUSAN E. DUNN |
| |
|
| |
/s/ Susan E. Dunn |
| |
Susan E. Dunn |
| |
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
SUSAN E. DUNN TRUST |
| |
U/W ELIZABETH J. NORDSTROM |
| |
|
|
| |
By: |
/s/ Susan E. Dunn |
| |
Name: |
Susan E. Dunn |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
ESTATE
OF BRUCE A. NORDSTROM |
| |
|
| |
By: |
/s/
Margaret Jean O’Roark Nordstrom |
| |
Name: |
Margaret
Jean O’Roark Nordstrom |
| |
Title: |
Co-Executor |
| |
|
|
| |
By: |
/s/
Peter E. Nordstrom |
| |
Name: |
Peter
E. Nordstrom |
| |
Title: |
Co-Executor |
| |
|
|
| |
By: |
/s/
Erik B. Nordstrom |
| |
Name: |
Erik
B. Nordstrom |
| |
Title: |
Co-Executor |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
1976 BRUCE A. NORDSTROM TRUST |
| |
(AKA 1976 ELIZABETH J. NORDSTROM TRUST FBO BRUCE A. NORDSTROM) |
| |
|
|
| |
By: |
/s/ Peter E. Nordstrom |
| |
Name: |
Peter E. Nordstrom |
| |
Title: |
Co-Trustee |
| |
|
|
| |
By: |
/s/ Erik B. Nordstrom |
| |
Name: |
Erik B. Nordstrom |
| |
Title: |
Co-Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
TRUST A U/W FRANCES W. NORDSTROM |
| |
|
|
| |
By: |
/s/ Peter E. Nordstrom |
| |
Name: |
Peter E. Nordstrom |
| |
Title: |
Co-Trustee |
| |
|
|
| |
By: |
/s/ Erik B. Nordstrom |
| |
Name: |
Erik B. Nordstrom |
| |
Title: |
Co-Trustee |
| |
|
|
| |
By: |
/s/ Charles W. Riley, Jr. |
| |
Name: |
Charles W. Riley, Jr. |
| |
Title: |
Co-Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
MARGARET JEAN O’ROARK NORDSTROM |
| |
|
| |
/s/ Margaret Jean O’Roark Nordstrom |
| |
Margaret Jean O’Roark Nordstrom |
| |
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
BRUCE AND JEANNIE NORDSTROM 2010 MFN TRUST |
| |
|
|
| |
By: |
/s/ Peter E. Nordstrom |
| |
Name: |
Peter E. Nordstrom |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
PETE AND BRANDY NORDSTROM 2010 MFN TRUST |
| |
|
|
| |
By: |
/s/ Erik B. Nordstrom |
| |
Name: |
Erik B. Nordstrom |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
BRUCE AND JEANNIE NORDSTROM 2012 CFN TRUST |
| |
|
|
| |
By: |
/s/ Peter E. Nordstrom |
| |
Name: |
Peter E. Nordstrom |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
PETE AND BRANDY NORDSTROM CFN TRUST |
| |
|
|
| |
By: |
/s/ Erik B. Nordstrom |
| |
Name: |
Erik B. Nordstrom |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
PETE AND BRANDY NORDSTROM 2012 CHILDREN’S TRUST |
| |
|
|
| |
By: |
/s/ Erik B. Nordstrom |
| |
Name: |
Erik B. Nordstrom |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
LEIGH E. NORDSTROM |
| |
|
|
| |
/s/ Leigh E. Nordstrom |
| |
Leigh E. Nordstrom |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
SAMUEL C. NORDSTROM |
| |
|
| |
/s/ Samuel C. Nordstrom |
| |
Samuel C. Nordstrom |
| |
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
SARA D. NORDSTROM |
| |
|
| |
/s/ Sara D. Nordstrom |
| |
Sara D. Nordstrom |
| |
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
ERIK AND JULIE NORDSTROM 2012 |
| |
SARA D. NORDSTROM TRUST |
| |
|
|
| |
By: |
/s/ Peter E. Nordstrom |
| |
Name: |
Peter E. Nordstrom |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
LN 1989 TRUST JWN |
| |
|
|
| |
By: |
/s/ Linda Nordstrom |
| |
Name: |
Linda Nordstrom |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
LN HOLDINGS JWN LLC |
| |
|
|
| |
By: |
/s/ Kimberly Mowat Bentz |
| |
Name: |
Kimberly Mowat Bentz |
| |
Title: |
Manager |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
LN HOLDINGS JWN II
LLC |
| |
|
|
| |
By: |
/s/ Kimberly Mowat Bentz |
| |
Name: |
Kimberly Mowat Bentz |
| |
Title: |
Manager |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
LN MEDINA FAMILY LLC |
| |
|
|
| |
By: |
/s/ Kimberly Mowat Bentz |
| |
Name: |
Kimberly Mowat Bentz |
| |
Title: |
Manager |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
ALEXANDRA F. NORDSTROM |
| |
|
|
| |
/s/ Alexandra F. Nordstrom |
| |
Alexandra F. Nordstrom |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
BLAKE & MOLLY NORDSTROM 2012 TRUST |
| |
FBO ALEXANDRA F. NORDSTROM |
| |
|
|
| |
By: |
/s/ Alexandra F. Nordstrom |
| |
Name: |
Alexandra F. Nordstrom |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
ANDREW L. NORDSTROM |
| |
|
|
| |
/s/ Andrew L. Nordstrom |
| |
Andrew L. Nordstrom |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
BLAKE AND MOLLY NORDSTROM |
| |
2012 TRUST FBO ANDREW L NORDSTROM |
| |
|
|
| |
By: |
/s/ Andrew L. Nordstrom |
| |
Name: |
Andrew L. Nordstrom |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
MOLLY NORDSTROM |
| |
|
| |
/s/ Molly Nordstrom |
| |
Molly Nordstrom |
| |
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
BWN TRUST U/W BLAKE W. NORDSTROM |
| |
|
|
| |
By: |
/s/ Molly Nordstrom |
| |
Name: |
Molly Nordstrom |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
MARI MOWAT WOLF |
| |
|
|
| |
/s/ Mari Mowat Wolf |
| |
Mari Mowat Wolf |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
KIMBERLY MOWAT BENTZ |
| |
|
|
| |
/s/ Kimberly Mowat Bentz |
| |
Kimberly Mowat Bentz |
| |
|
| |
Address: |
[**] |
[Signature Page to Cooperation
Agreement]
| |
BLAKE MOWAT BENTZ 1991 TRUST |
| |
|
|
| |
By: |
/s/ Kimberly Mowat Bentz |
| |
Name: |
Kimberly Mowat Bentz |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
| |
KYLE ANDREW BENTZ TRUST 1993 |
| |
|
|
| |
By: |
/s/ Kimberly Mowat Bentz |
| |
Name: |
Kimberly Mowat Bentz |
| |
Title: |
Trustee |
| |
|
|
| |
Address: |
[**] |
[Signature Page to Cooperation Agreement]
SC 13E3
EX-FILING FEES
0000072333
0-11
true
false
0000072333
1
2025-03-04
2025-03-04
0000072333
1
2025-03-04
2025-03-04
0000072333
2
2025-03-04
2025-03-04
0000072333
2025-03-04
2025-03-04
iso4217:USD
xbrli:pure
xbrli:shares
Ex-Filing Fees
CALCULATION OF FILING FEE TABLES
SC 13E-3
NORDSTROM, INC.
Nordstrom, Inc.
Norse Holdings, Inc.
Navy Acquisition Co. Inc.
El
Puerto de Liverpool, S.A.B. de C.V.
Anne
E. Gittinger
Anne
E. Gittinger Trust u/w Everett W. Nordstrom
1976
Elizabeth J. Nordstrom Trust FBO Anne Gittinger
Charles
W. Riley, Jr., solely in his capacity as trustee of Anne E. Gittinger Trust u/w Everett W. Nordstrom and as co-trustee of Trust A u/w
Frances W. Nordstrom and not in any individual capacity
Estate
of Bruce A. Nordstrom
1976
Bruce A. Nordstrom Trust (aka 1976 Elizabeth J. Nordstrom Trust FBO Bruce A. Nordstrom)
Trust
A u/w Frances W. Nordstrom
Margaret
Jean O'Roark Nordstrom, in her capacity as co-executor of the Estate of Bruce A. Nordstrom
Peter
E. Nordstrom
Erik
B. Nordstrom
James
F. Nordstrom, Jr.
Katharine
T. Nordstrom 2007 Trust Agreement
Julia
K. Nordstrom 2007 Trust Agreement
Audrey
G. Nordstrom 2007 Trust Agreement
Erik
and Julie Nordstrom 2012 Sara D. Nordstrom Trust
Bruce
and Jeannie Nordstrom 2010 MFN Trust
Pete
and Brandy Nordstrom 2010 MFN Trust
Bruce
and Jeannie Nordstrom 2012 CFN Trust
Pete
and Brandy Nordstrom 2012 CFN Trust
Pete
and Brandy Nordstrom 2012 Children’s Trust
(Exact Name of Registrant and Name of Persons Filing Statement)
Table 1 to Paragraph (a)(7)
| |
|
|
|
|
|
|
|
|
|
|
| Line Item Type |
|
Notes |
|
Transaction
Valuation |
|
Fee Rate |
|
Amount
of
Filing Fee |
| |
|
|
|
|
|
|
|
|
|
|
| Fees to be Paid |
|
(1) |
|
$ |
2,674,529,169.01 |
|
0.00015310 |
|
$ |
409,470.42 |
| |
|
|
|
|
|
|
| Total Transaction Valuation: |
|
$ |
2,674,529,169.01 |
|
|
|
|
|
| Total Fees Due for Filing: |
|
|
|
|
|
|
$ |
409,470.42 |
| Total Fees Previously Paid: |
|
|
|
|
|
|
|
0.00 |
| Total Fee Offsets: |
|
|
|
|
|
|
$ |
409,470.42 |
| Net Fee Due: |
|
|
|
|
|
|
$ |
0.00 |
__________________________________________
Offering Note(s)
| (1) | |
Aggregate number of securities to which transaction applies: As of January 31, 2025, the maximum number of Nordstrom, Inc.’s common stock, no par value
per share (the “Nordstrom Common Stock”), to which this transaction applies is estimated to be 110,833,623, which consists of (1) 98,322,348 shares of
Nordstrom Common Stock entitled to receive the maximum payable per share merger consideration of $24.50 (which excludes any Rollover Shares); (2)
2,409,817 shares of Nordstrom Common Stock underlying outstanding and unexercised stock options to purchase shares of Nordstrom Common Stock,
which have an exercise price per share that is less than $24.50 (such options, the “In-the-Money Options”); (3) 7,581,470 shares of Nordstrom Common Stock
underlying outstanding restricted stock units, which may be entitled to receive the maximum payable per share merger consideration of $24.50; and (4)
2,519,988 shares of Nordstrom Common Stock underlying outstanding performance-based restricted stock units, which may be entitled to receive the
maximum payable per share merger consideration of $24.50 (assuming maximum performance). Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): Estimated solely for
the purposes of calculating the filing fee, as of January 31, 2025, the underlying value of the transaction was calculated based on the sum of (1) the product of
98,322,348 shares of Nordstrom Common Stock and the maximum payable per share merger consideration of $24.50; (2) the product of 2,409,817 shares of
Nordstrom Common Stock underlying the In-the-Money Options and $7.53 (which is the difference between the per share merger consideration of $24.50 and
the weighted average exercise price of the In-the-Money Options of $16.97); (3) the product of 7,581,470 shares of Nordstrom Common Stock underlying
outstanding restricted stock units and the maximum payable per share merger consideration of $24.50; and (4) 2,519,988 shares of Nordstrom Common
Stock underlying outstanding performance-based restricted stock units and the maximum payable per share merger consideration of $24.50. In accordance
with Section 14(g) of the Securities Exchange Act of 1934, as amended, the filing fee was determined by multiplying the sum calculated in the preceding
sentence by .00015310. |
Table 2 to Paragraph (a)(7)
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Line Item Type |
|
Notes |
|
Registrant or Filer Name |
|
Form or Filing Type |
|
File Number |
|
Initial Filing Date |
|
Filing Date |
|
Fee Offset Claimed |
|
Fee Paid
with Fee
Offset Source |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Fee Offset Claims |
|
|
|
|
|
Schedule 14A |
|
001-15059 |
|
03/04/2025 |
|
|
|
$ |
409,470.42 |
|
|
|
| Fee Offset Sources |
|
(1) |
|
Nordstrom, Inc. |
|
Schedule 14A |
|
001-15059 |
|
|
|
03/04/2025 |
|
|
|
|
$ |
409,470.42 |
__________________________________________
Explanation of the basis for claimed offset:
| (1) | |
Nordstrom, Inc. previously paid $409,470.42 upon the filing of its Schedule 14A on March 4, 2025 in connection with the transaction reported hereby. |
v3.25.0.1
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-Section 12
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v3.25.0.1
Offerings - Offering: 1
|
Mar. 04, 2025
USD ($)
|
| Offering: |
|
| Fee Previously Paid |
false
|
| Rule 0-11 |
true
|
| Transaction Valuation |
$ 2,674,529,169.01
|
| Fee Rate |
0.01531%
|
| Amount of Registration Fee |
$ 409,470.42
|
| Offering Note |
Aggregate number of securities to which transaction applies: As of January 31, 2025, the maximum number of Nordstrom, Inc.’s common stock, no par value
per share (the “Nordstrom Common Stock”), to which this transaction applies is estimated to be 110,833,623, which consists of (1) 98,322,348 shares of
Nordstrom Common Stock entitled to receive the maximum payable per share merger consideration of $24.50 (which excludes any Rollover Shares); (2)
2,409,817 shares of Nordstrom Common Stock underlying outstanding and unexercised stock options to purchase shares of Nordstrom Common Stock,
which have an exercise price per share that is less than $24.50 (such options, the “In-the-Money Options”); (3) 7,581,470 shares of Nordstrom Common Stock
underlying outstanding restricted stock units, which may be entitled to receive the maximum payable per share merger consideration of $24.50; and (4)
2,519,988 shares of Nordstrom Common Stock underlying outstanding performance-based restricted stock units, which may be entitled to receive the
maximum payable per share merger consideration of $24.50 (assuming maximum performance). Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): Estimated solely for
the purposes of calculating the filing fee, as of January 31, 2025, the underlying value of the transaction was calculated based on the sum of (1) the product of
98,322,348 shares of Nordstrom Common Stock and the maximum payable per share merger consideration of $24.50; (2) the product of 2,409,817 shares of
Nordstrom Common Stock underlying the In-the-Money Options and $7.53 (which is the difference between the per share merger consideration of $24.50 and
the weighted average exercise price of the In-the-Money Options of $16.97); (3) the product of 7,581,470 shares of Nordstrom Common Stock underlying
outstanding restricted stock units and the maximum payable per share merger consideration of $24.50; and (4) 2,519,988 shares of Nordstrom Common
Stock underlying outstanding performance-based restricted stock units and the maximum payable per share merger consideration of $24.50. In accordance
with Section 14(g) of the Securities Exchange Act of 1934, as amended, the filing fee was determined by multiplying the sum calculated in the preceding
sentence by .00015310.
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- DefinitionThe rate per dollar of fees that public companies and other issuers pay to register their securities with the Commission. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
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v3.25.0.1
| X |
- DefinitionThe initial filing date of the earlier registration statement with which the earlier (offsetting) fee was paid for a claimed offset. If the offset fee was paid with an amendment, do not provide the amendment date under this element; instead, provide the date of the initial filing (i.e. the "parent" filing) . Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 457
-Subsection p
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-Name Securities Act
-Number 230
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| X |
- DefinitionThe amount of offsetting fees being claimed. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 457
-Subsection p
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-Name Securities Act
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| X |
- DefinitionThe fee prevoiusly paid from which an offset is being derived. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 457
-Subsection p
Reference 2: http://www.xbrl.org/2003/role/presentationRef
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| X |
- DefinitionThe EDGAR File Number of the earlier registration statement with which the earlier (offsetting) fee was paid. If the offset filing for the offset has a Securities Act File Number and an Investment Company Act File Number, the Securities Act File Number should be used. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 457
-Subsection p
Reference 2: http://www.xbrl.org/2003/role/presentationRef
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-Name Securities Act
-Number 230
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| X |
- DefinitionThe name of the registrant that filed the earlier registration statement with which the earlier (offsetting) fee was paid. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 457
-Subsection p
Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
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| X |
- DefinitionThe filing date of the earlier registration statement with which the earlier (offsetting) fee was paid in an offset. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 457
-Subsection p
Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 457
-Subsection b
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| Namespace Prefix: |
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| X |
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v3.25.0.1
| X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
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| Namespace Prefix: |
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| Balance Type: |
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|
| X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
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| Namespace Prefix: |
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| Period Type: |
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|
| X |
- ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
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