<SEC-DOCUMENT>0001193125-22-143906.txt : 20220509
<SEC-HEADER>0001193125-22-143906.hdr.sgml : 20220509
<ACCEPTANCE-DATETIME>20220506191854
ACCESSION NUMBER:		0001193125-22-143906
CONFORMED SUBMISSION TYPE:	DEFA14A
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20220509
DATE AS OF CHANGE:		20220506

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			KOHLS Corp
		CENTRAL INDEX KEY:			0000885639
		STANDARD INDUSTRIAL CLASSIFICATION:	RETAIL-DEPARTMENT STORES [5311]
		IRS NUMBER:				391630919
		STATE OF INCORPORATION:			WI
		FISCAL YEAR END:			0129

	FILING VALUES:
		FORM TYPE:		DEFA14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-11084
		FILM NUMBER:		22902848

	BUSINESS ADDRESS:	
		STREET 1:		N56 W17000 RIDGEWOOD DR
		CITY:			MENOMONEE FALLS
		STATE:			WI
		ZIP:			53051
		BUSINESS PHONE:		262 703 7000

	MAIL ADDRESS:	
		STREET 1:		N56 W17000 RIDGEWOOD DR
		CITY:			MENOMONEE FALLS
		STATE:			WI
		ZIP:			53051

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	KOHLS CORPORATION
		DATE OF NAME CHANGE:	19930328
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<DESCRIPTION>DEFA14A
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<Center><DIV STYLE="width:8.5in" align="left">
 <P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P>
<P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>UNITED STATES </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>SECURITIES AND EXCHANGE COMMISSION </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Washington, D.C. 20549 </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>SCHEDULE&nbsp;14A INFORMATION </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>SECURITIES EXCHANGE ACT OF 1934 </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>(AMENDMENT NO.&nbsp;&nbsp;&nbsp;&nbsp;) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Filed by the
Registrant&nbsp;&nbsp;&#9746; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Filed by a Party other than the Registrant&nbsp;&nbsp;&#9744;</P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Check the appropriate box: </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Preliminary Proxy Statement </P></TD></TR></TABLE>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><B></B>&#9744;<B></B><B></B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) </B></P></TD></TR></TABLE>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Definitive Proxy Statement </P></TD></TR></TABLE>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Definitive Additional Materials </P></TD></TR></TABLE>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Soliciting Material Pursuant to &#167;240.14a-12 </P></TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>KOHL&#146;S CORPORATION </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>(Name of Registrant as Specified In Its Charter) </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>(Name of Person(s) Filing Proxy Statement if other than the Registrant) </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Payment of Filing Fee (Check all boxes that apply): </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">No fee required </P></TD></TR></TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Fee paid previously with preliminary materials </P></TD></TR></TABLE>
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<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11
</P></TD></TR></TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P> <P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>THE FOLLOWING ARTICLE&nbsp;WAS PUBLISHED ON MAY&nbsp;6, 2022: </B></P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Milwaukee Journal Sentinel:</B> Kohl&#146;s Corp. future uncertain as investor fight nears end, sale of
company considered. 4,000 area jobs, corporate headquarters at risk. </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">By Ricardo Torres </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">May 6<SUP STYLE="font-size:85%; vertical-align:top">th</SUP>, 2022 </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">For months, Kohl&#146;s Corp. has been in a fight for the future of the company, marked by challenges from aggressive activist investors alongside multiple
offers to buy the company. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The boardroom battles could have a dramatic impact in southeastern Wisconsin, where Kohl&#146;s has about 4,000 jobs in the
greater Milwaukee area, largely at its Menomonee Falls headquarters, and about 8,000 employees statewide in 41 stores. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The outcomes &#151; a board
takeover or outright sale of the company &#151; could sweep across the 1,100 Kohl&#146;s stores and nearly 100,000 workers across the country. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">It&#146;s
one of the most dramatic possible reshapings of a company currently playing out on Wall Street. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Some answers will come Wednesday at the Kohl&#146;s
annual shareholder meeting. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">At that online meeting, investors will choose the board of directors &#151;&nbsp;a slate is offered by Kohl&#146;s management
and a rival slate is being advanced by activist investor Macellum Capital Management. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">If Macellum wins control of the board, there could be major changes
coming to Kohl&#146;s. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;What will happen is there&#146;ll be restructuring, very likely the CEO will be replaced, a lot of people probably lose
their jobs,&#148; said Margaret Hughes-Morgan, associate professor of management at Marquette University with experience on Wall Street. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Both sides
have dug in </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Macellum has nominated 10 people the Kohl&#146;s board, including Jonathan Duskin, managing partner of the hedge fund. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In response, Kohl&#146;s enacted a shareholder rights plan, often called a &#147;poison pill&#148; to prevent anyone from acquiring more than 10% of the
company. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Both sides have dug in and in recent weeks sent campaign-like missives, complete with aggressive, pointed statements, to shareholders &#151;
primarily large investment institutions. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In April, Kohl&#146;s revealed Macellum made roughly $27&nbsp;million in January trading company stock options.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In response, Macellum accused Kohl&#146;s of running a &#147;flawed and opaque&#148; sales process. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Some clues have emerged into the advice that shareholders are receiving. Two have been favorable, overall,
for current Kohl&#146;s management. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On April&nbsp;29, Institutional Shareholder Services Inc., which produces research and makes recommendations to
shareholders, released a report supporting two of Macellum&#146;s 10 nominees for the board. The activist investor took the report as a win for its side. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Kohl&#146;s pointed out the report does not suggest a change in board control, which is what Macellum is hoping for. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Less than a week later, Glass Lewis, a research firm similar to ISS, published a report endorsing all 13 of Kohl&#146;s&#146; nominations to the board. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Familiar ground covered in 2021 </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The company and the
activist investor have been down this path before. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In 2021, Macellum negotiated with Kohl&#146;s and was able to get three board members elected by
shareholders. Now less than a year later, they&#146;re back for the whole board. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;I will tell you what his ultimate end game is and that is to get
the stock price up,&#148; Hughes-Morgan said. &#147;(Duskin is) going to do whatever he thinks is going to increase the share price.&#148; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Before joining
Marquette, Hughes-Morgan&#146;s most recent position was as a director for the United Bank of Switzerland where she specialized in analysis of biotechnology and pharmaceutical stocks.&nbsp;She also worked at Lehman Brothers as an institutional
salesperson. And Hughes-Morgan worked for the Wall Street Consulting Group, which did research for hedge funds.</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Hughes-Morgan called Kohl&#146;s an
&#147;underperforming company&#148; but said its most recent quarterly reports &#147;weren&#146;t that bad.&#148; </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Timing is everything </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Besides changing the board, Macellum wants to increase revenue and boost Kohl&#146;s stock price by selling the real estate Kohl&#146;s owns and then leasing
the buildings, and spinning off its <FONT STYLE="white-space:nowrap">e-commerce</FONT> website as a separate business.</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On April&nbsp;13, Kohl&#146;s
investor T. Rowe Price, which owns about 5.3% of the company, said it disagrees with the sale-leaseback strategy. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;We would have concerns about such
a transaction, as it could unduly increase leverage of this cyclical company at the wrong point in the cycle, &#148;T. Rowe Price said in a press release, adding it would vote for the Kohl&#146;s slate of board candidates. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Grocery chain also targeted </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Meanwhile, Macellum is pursuing an unrelated fight that could reshape a completely different industry - a chain of grocery stores with some operations in
Wisconsin. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Macellum, along with another firm, Ancora, turned its sights on Michigan-based SpartanNash, a grocery store chain. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">SpartanNash owns four grocery stores in Wisconsin: two Family Fare grocery stores in Chippewa Falls, one Family Fresh market in River Falls and Fresh Madison
Market in Madison. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Combined the four stores employ roughly 350 workers and contribute roughly $400,000 worth of product donations and raised financial
contributions for the local communities throughout Wisconsin. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On April&nbsp;19, six days after T. Rowe Price declined to back Macellum&#146;s plans for
Kohl&#146;s, Macellum and Ancora sent a letter to the shareholders of SpartanNash expressing their frustrations with the company and suggesting ways to increase the stock price that were similar to the idea for Kohl&#146;s. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In the letter it said the board and company&#146;s leadership saying it is &#147;wed to a flawed corporate structure and has failed to implement basic
operating initiatives while leaving $1&nbsp;billion of owned real estate sitting idle on the balance sheet.&#148;</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The letter also states Macellum and
Ancora believe there is &#147;at least one financial buyer and one real estate firm that have been interested in pursuing transactions with SpartanNash over the past two years. We have also received unsolicited communications from other strategic
buyers willing to pay a meaningful premium for the whole or a part of the company.&#148;</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In the letter Duskin was also suggested as a board candidate for
SpartanNash. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On April&nbsp;26, Reuters reported United Natural Foods Inc. and Oak Street Real Estate Capital are separately working on bids to buy
SpartanNash.</P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Numerous sale bids considered </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">As
Kohl&#146;s fights with Macellum over the future direction of the company, it&#146;s also fielding bids from other companies to buy the business.</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">While
the sales process is separate from the board of directors election, both sides have supporters lined up behind them pressuring the company. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On
March&nbsp;16, Engine Captial LP, which owns roughly 1% of the company, sent a letter to the Kohl&#146;s board saying it should &#147;let shareholders make the ultimate assessment about a sale of Kohl&#146;s.&#148; </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Less than 10 days later on March&nbsp;25, Wisconsin U.S. Sen. Tammy Baldwin, a Democrat, sent a letter to the Kohl&#146;s board urging them to &#147;consider
each bidder&#146;s long-term strategy for the </P>
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company and reject any offer that includes plans to dramatically increase debt; sell off assets (particularly real estate for a &#145;sale-leaseback&#146;); increase shareholder payouts at the
expense of reinvestment; or pursue any other proposal that puts Wisconsin workers and communities at risk by increasing the chance of bankruptcy.&#148;</P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">It&#146;s been reported that Kohl&#146;s has received a $8.6&nbsp;billion oint offer from shopping-mall giant Simon Property and Canada-based Brookfield Asset
Management, which together bought JC Penney when it filed for bankruptcy in 2020. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On April&nbsp;14, Franchise Group, owner of The Vitamin Shoppe, made a
$9&nbsp;billion offer to buy Kohl&#146;s. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In March, Canadian retailer Hudson Bay was reportedly interested in buying Kohl&#146;s. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">And in January, a group led by Acacia Research Corp. made an offer of $9&nbsp;billion to buy Kohl&#146;s, which the company rejected saying it was too low.
</P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Macellum enjoys a trading windfall </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Kohl&#146;s
noted that trades by Macellum at this time resulted in a windfall for the fund. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Kohl&#146;s stated Macellum bought stock options representing
2.6&nbsp;million shares of the company&#146;s common stock between January&nbsp;12 and 21. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Late on Jan. 21, a Friday, reports of the unsolicited
$9&nbsp;billion offer by Acacia to buy Kohl&#146;s became public. Also that day, Duskin said on CNBC that Kohl&#146;s stock could be worth as much a $100 per share with a refreshed board.</P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">When markets opened Jan. 24, Kohl&#146;s stock surged from roughly $47 per share to nearly $64 per share.</P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On Jan. 24, Macellum sold options accounting for roughly 700,000 shares of Kohl&#146;s common stock when the price was at $63.71 per share. Macellum continued
to sell options during the next four days accounting for another roughly 700,000 shares as the stock price hovered between $62.27 and $60.16. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>&#145;Downright shady&#146; trades </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Selling options is
not illegal and Kohl&#146;s is not alleging Macellum violated the law. The company, though, pointed out that in a week, Macellum made roughly $27&nbsp;million selling Kohl&#146;s options after news of a potential buyer became public. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Hughes-Morgan said Duskin is a &#147;savvy investor&#148; and if there was anything illegal done in the process of those trades &#147;he will likely get away
with it because the burden of proof is on the SEC to prove he did anything wrong. But that&#146;s just downright shady.&#148; </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Hughes-Morgan said the trading indicated that Macellum might not be interested in improving Kohl&#146;s, but
rather &#147;they&#146;re just trying to make a quick buck.&#148; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;That kind of pisses me off,&#148; Hughes-Morgan said of Macellum selling
Kohl&#146;s stock options. &#147;(Kohl&#146;s) is a real company, with real people. Poorly run or not, it&#146;s going to impact people&#146;s lives. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;These activist investors, all they&#146;re interested in is money.&#148; </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>In and out of Big Lots </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Peter Sommerhauser, an attorney
for Godfrey and Kahn, has worked in mergers and acquisitions since he arrived in Milwaukee in 1969. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;Sometimes activists are necessary because a
company isn&#146;t performing appropriately and hasn&#146;t changed direction and hasn&#146;t hired the right people and just proceeds as if nothing&#146;s changed,&#148; Sommerhauser said. &#147;And sometimes it&#146;s not for the right
reasons.&#148; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Sommerhauser worked as outside legal counsel for Kohl&#146;s in 1986 and was on the board of directors for Kohl&#146;s for more than 20
years. He was part of the board that hired current Kohl&#146;s CEO Michelle Gass but is currently not on the board.</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;There&#146;s a lot of people
investing with activists, it&#146;s basically a hedge fund and they can get in and out of companies quickly and they can make a lot of money,&#148; Sommerhauser said. &#147;And they&#146;re not restricted the same way companies are in terms of
communication. You can make a lot of money as an activist.&#148; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">One of the companies Macellum got in and out of quickly was Big Lots. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In 2020, Macellum along with Ancora, which together owned about 9.8% of the company, successfully added three members to Big Lots board, including Aaron
Goldstein, a partner and portfolio manager at Macellum. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">At the time Duskin said: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;We are pleased to have reached this resolution with Big Lots and appreciate the collaborative dialogue and engagement we have had with the board. We
believe this level of board refreshment and the formation of a capital allocation planning committee are positive steps that will support the board&#146;s efforts to deliver increasing value to shareholders.&#148;</P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">While Macellum invested in the company, Big Lots did several sale-leasebacks of its property but not all of it. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Duskin credits Macellum&#146;s strategy with helping Big Lots stock move from roughly $12 in March 2020 to $70 roughly a year later. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Now, two years later, two of the three board members that were elected are no longer on the board, including
Goldstein, and Macellum has divested its Big Lots holdings. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">But activists investors are now going after the remaining Big Lots property that wasn&#146;t
part of the sale-leaseback transaction. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On March&nbsp;15, Mill Road Capital, which owns 5% of Big Lots sent a letter to shareholders saying
&#147;management has done a great job&#148; but it believes the stock price could be higher in the $55 to $70 per share range &#147;which could be unlocked in a sale leaseback transaction.&#148; </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The final paragraph in the Mill Road Capital letter to shareholders references what&#146;s going on with Kohl&#146;s currently to increase the share
price.</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;We also believe that the recent acquisition proposals received by Kohl&#146;s Corporation support our view that there are currently credible
buyers for retail assets that possess growth potential, attractive transaction financing, and a discounted valuation,&#148; the letter states. &#147;Consequently, we strongly believe the best path to present value maximization for shareholders is
for Big Lots&#146; board of directors to engage an independent financial advisor in the near term to actively solicit acquisition proposals for the company.&#148;</P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Future of Kohl&#146;s uncertain </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">As shareholders go to a
contested board vote, Kohl&#146;s future is uncertain. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Kohl&#146;s is banking on a strategy that includes its partnership with Sephora and growing that
into a $2&nbsp;billion business as it rolls out several hundred Sephora at Kohl&#146;s stores.</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Duskin is hoping shareholders back his plan for a new
board.</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Hughes-Morgan remains skeptical of the activist investor&#146;s motivation. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;I don&#146;t think he wants to take over the company and run it for the next 10 years,&#148; Hughes-Morgan said. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;I think he wants to get enough clout in the company to make them make some decisions that are going to increase the stock price, whatever that may
be.&#148; </P>
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