INTERCO(Student)

Copyright

INTERCO HARVARD BUSINESS SCHOOL Case Software Software 22!"#2$ Copyright %1!!1 &y the Presi'e(t a(' )e**ows of Har+ar' Co**ege, Researc Research h Associa Associate te Susan Susan L. Rother Rother prepared prepared this case case under under the superv supervisio ision n of Profes Profes as the basis for class discussion rather than to illustrate either eective or ineective administrative situation.

Page 1

Copyright

sor Scott P. Mason andling of an

Page 2

E-hi&it 1

Exhibit 1

Board of Directors as of May 16, 1988

Har+ey Sa*ig/a(

Chair/a( of the Boar' a(' CEO of I(ter0o

Harry , rogh

Presi'e(t a(' COO of I(ter0o

Ro(a*' L, Ay*war'

Vi0e Chair/a( of the Boar' of I(ter0o

R, St3art oore

Vi0e Presi'e(t of I(ter0o4 Presi'e(t of 5he La(e Co/pa(y6

ar7 H, Lie&er/a(

Vi0e Presi'e(t of I(ter0o4 Presi'e(t of Lo('o(tow(6 a 'i+i

Ri0har' B, Loy('

Vi0e Presi'e(t of I(ter0o4 Chair/a( of the Boar' of Co(+e

Char*es 8, Roths0hi*'6 8r,

Vi0e Presi'e(t of I(ter0o4 Ch Chair/a( of th the Boar' of e egas

:a(e E, Bar(es

Chair/a( of the Boar'6 Presi'e(t6 CEO a(' 'ire0tor of So

Do(a*' E, Lasater

Chair/a( of the Boar'6 CEO a(' 'ire0tor of er0a(ti*e Ba

Lee , Li&er/a(

Chair/a( of the Boar'6 Presi'e(t6 CEO a(' 'ire0tor of La

Ro&ert H, ;3e(o(

Presi'e(t6 CEO a(' 'ire0tor of Pea&o'y Ho*'i(g Co/pa(y


Presi'e(t6 CEO a(' 'ire0tor of U(io( E*e0tri0 Co/pa(y6 a

ari*y( S, Lewis

Ci+i0 *ea'er a(' +o*3(teer

 5ho/as H, O=Leary

Vi0e Chair/a( Chair/a( of the Boar' Boar' a(' 'ire0tor 'ire0tor of B3r*i(gto( B3r*i(gto( No

As of Apri* 1>6 1!?? a** 'ire0tors6 (o/i(ees a(' o@0ers of I(ter0o6 as a gro3p 2 perso(s

Page .

E-hi&it 1

I(0,6 a s3&si'iary of I(ter0o sio( of I(ter0o rse6 I(0,6 a s3&si'iary of I(ter0o tar Appare* 9ro3p6 a 'i+isio( of I(ter0o thwester( Be** Corporatio(6 e(gage' i( the ge(era* te*e0o//3(i0atio(s &3si(ess (0orporatio(6 I(0,6 a &a(7 ho*'i(g 0o/pa(y6 a(' Chair/a( of the Boar' a(' 'ire0tor of *e'e 9as Co/pa(y6 a gas p3&*i0 3ti*ity 6 I(0,6 whi0h is e(gage' i( 0oa* /i(i(g a(' sa*es e*e0tri0 p3&*i0 3ti*ity

ther( I(0,6 a ho*'i(g 0o/pa(y with tra(sportatio(6 e(ergy a(' (at3ra* reso3r0es 0o(0e e(e0ia**y ow(e' 1,1 of the o3tsta('i(g shares of I(ter0o=s 0o//o( sto07,

Page 

E-hi&it 1

er0a(ti*e Ba(7 Natio(a* Asso0iatio(

r(s

Page >

E-hi&it 2

Exhibit 2

!bsidiaries

A&e S0hra'er Corp, Big Fa(7 Corp, Bowe( Shoe Co,6 I(0, Broyhi** )3r(it3re I('3stries6 I(0, Ca/p0o Ho*'i(gs6 S,A, Ca/p3s Pa0i0 Lt', Ce(tra* Har'ware Co, C*ayto( Operatio(s6 S,A, Co**ege5ow(6 I(0, Co(+erse I(0, De*/ar Sportswear6 I(0, Etha( A**e( I(0, )a0tory O3t*et Co, )i(e=s e(=s Shops6 I(0, )*orshei/ I(0, )*orshei/ Shoe Store Co, of Hawaii )*orshei/ Shoe Store Co,Gi'west )*orshei/ Shoe Store Co,GNorthwest )*orshei/ Shoe Store Co,GSo3th )*orshei/ Shoe Store Co,G
So3r0e Lot3s O(e So3r0e

Page "

E-hi&it .

Exhibit "

Co##o$ toc% &rice 'istory (Mo$th)y*

Mo$th E$d &rices (ad+!sted for stoc% s)its* 1986

.18a(?" 2?)e&?" .1ar?" .$Apr?" .$ay?" .$83(?" .183*?" 2!A3g?" .$Sep?" .1O0t?" 2?No+?" .1De0?"

J.>,1. .! .!,2> .!,"2> .,> #,1?? 1,.#> .,#> $ .,#> ,12> .",?#>

198-

.$8a(?# 2#)e&?# .1ar?# .$Apr?# 2!ay?# .$83(?# .183*?# .1A3g?# .$Sep?# .$O0t?# .$No+?# .1De0?#

.!,#> 2,"2> ,12> .!,"2> $,12> >,.#> >1,2> >.,2> #,> ." .$ .2,2>

1988

2!8a(?? 2!)e&?? .1ar?? 2!Apr?? .1ay?? .$83(?? 2!83*??

.#,12> 2 2 1,12> .,?#> ,#> "?,>

So3r0e I(tera0ti+e Data Corporatio(

Page #

E-hi&it 

Exhibit .

Co##o$ toc% &rice 'istory (Dai)y*

 Dai)y C)osi$/ &rices 2ay?? .ay?? ay?? >ay?? "ay?? !ay?? 1$ay?? 11ay?? 12ay?? 1.ay?? 1"ay?? 1#ay?? 1?ay?? 1!ay?? 2$ay?? 2.ay?? 2ay?? 2>ay?? 2"ay?? 2#ay?? .$ay?? .1ay?? 183(?? 283(?? .83(?? "83(?? #83(?? ?83(?? !83(?? 1$83(?? 1.83(?? 183(?? 1>83(?? 1"83(?? 1#83(?? 2$83(?? 2183(?? 2283(?? 2.83(?? 283(?? 2#83(?? 2?83(??

J$,2> 1,> 1 1,"2> $,"2> $,?#> 1,#> 1,"2> 2 2,12> 2,2> 2 1,> $,"2> $,"2> $,.#> 1,> 2,> 2,"2> 1,2> N,A, .,?#> .,> 2,?#> ,12> .,2> 2 .,?#> .,.#> .,.#> .,> .,"2> 2,> 2,?#> .,"2> .,2> .,12> .,#> .,"2> .,> .,"2> 

183*?? 83*?? >83*?? "83*?? #83*?? ?83*?? 1183*?? 1283*?? 1.83*?? 183*?? 1>83*?? 1?83*?? 1!83*?? 2$83*?? 2183*?? 2283*?? 2>83*?? 2"83*?? 2#83*?? 2?83*?? 2!83*?? 1A3g?? 2A3g?? .A3g?? A3g?? >A3g?? ?A3g??

Page ?

,"2> N,A, >,.#> ,> ,"2> > >,2> >,.#> ",.#> ! >,.#> >,> >?,.#> >?,12> >#,?#> >#,2> >? >?,?#> >!,.#> "#,#> "?,> "?,?#> "#,"2> "# "#,.#> "?,2> #2,>

E-hi&it 

2!83(?? .$83(??

 ,#>

So3r0e I(tera0ti+e Data Corporatio(

Page !

E-hi&it "

Exhibit 6

'istorica) Ba)a$ce heets

INTERCO Co$so)idated Ba)a$ce heet (0s excet er share data* ebr!ary 28, C3rre(t Assets Cash ar7eta&*e se03rities Re0ei+a&*e6 (et I(+e(tories Prepai' e-pe(ses a(' other 03rre(t assets  5ota* 03rre(t assets Property6 P*a(t a(' EK3ip/e(t   La(' B3i*'i(gs a(' i/pro+e/e(ts a0hi(ery a(' eK3ip/e(t Less a003/3*ate' 'epre0iatio( Net Property6 P*a(t a(' EK3ip/e(t Other Assets 5ota* Assets C3rre(t Lia&i*ities   Notes paya&*e C3rre(t /at3rities of *o(g ter/ 'e&t a(' 0apita* *ease o&*igatio(s A00o3(ts paya&*e a(' a00r3e' e-pe(ses I(0o/e ta-es  5ota* C3rre(t Lia&i*ities Lo(gter/ 'e&t6 *ess 03rre(t   /at3rities O&*igatio(s 3('er 0apita* *eases6 *ess 03rre(t /at3rities Other *o(gter/ *ia&i*ities

1986

198-

J1"6?>" 12#6.1 $2622> "#611"

J1"6".1 ".6## "6#>> #..6!$#

J2$6?! 116$.. ?"6"># ?$>6$!>

226>#

2>6"1

.>6"">

J1621"6$?>

J162?"6">

J16.>!62!!

2"6##$ .#6?12 .2$62>" #?6?.? ..6$1? 16?2$

.262"" ">6?11 ."6!! ?"26>#" .##622" ?>6.>$

.26>2> #16#?# .?$6$2 ??6#1 $>621> #!6!!

!!62.? J16#>"6?!.

1>.6.?. J16!2>6.?#

1"6#?? J16!?>6>?"



J"?6?$

J#$6>1#

!6"#

116!1>

?61#2

1?6$.2 126"!! J2!6>?#

21"6."> 1#6.2# J.>?622"

2.!6>1. 6$2 J.#.6..

12#6$!

1.>6$1!

2>#6.2#

>"6!> .62!

>$6>" >>6.?1

16?1. "16#""

J

Shareho*'ers= EK3ity

Page 1$

1988(a*

E-hi&it "

Preferre' sto076 (o par +a*3e Co//o( sto076 J.,#> state' +a*3e Capita* s3rp*3s 16.>"6?# shares iss3e' Retai(e' ear(i(gs Less >61#.6?11 treas3ry shares  5ota* Shareho*'ers= EK3ity   5ota* Lia&i*ities a(' Net
""6$2# 1".6#">

"16#!> 1".6".

>#611. 1>>6$??

1$62$> 16$2#6?!> 16."16?!2 ?16#.! 162?$61>. J16#>"6?!.

!?62" 16$!!6$$" 16226"!$ !"6#> 16.2"621> J16!2>6.?#

6>.! 161#!6!" 16."6#$ 1?>6."# 162>16..# J16!?>6>?"

So3r0e A((3a* report6 1$;=s a )e&r3ary 2!6 1!??

Page 11

E-hi&it "

198-

1988

J2!6#$$ >#6#?! .16#. #?"6#!2

J1!6"22 1"6."" "$6#>! ?#261.>

2>6"22

6!>!

J16..16""

J161.6?1

   ?"?6"#$ .?"6#"2 ?16!$?

   ?!$6??# 126..2 #?6>>>

1!61#$ J16!"26#2

1"6?#? J26$.!62#.

J!#62!#

J1"6$1"

!62??

?6!$$

2#?6?# 1>62! J$$6#2"

2!26$>1 >6". J>26.$

1..6$.

2>>62#!

!62#$ >"61$

$6$.2 ".6?

Page 12

E-hi&it "

"162?> 1>>6$??

."6#21 1>>6$??

!61! 161116>2# 16.##6$! >61. 16.226!1> J16!"26#2

.2611# 161!6?? 161?6?1$ 1!$6#"2 1622?6$? J26$.!62#.

Page 1.

E-hi&it #

Exhibit -

'istorica) I$co#e tate#e$ts

INTERCO Co$so)idated tate#e$t of Ear$i$/s (0s* 1986

198-

1988(a*

irst 3!arter 198-

J26?.26.? ."61$ 26?"?6>2

J26!"6!$2 .261#> 26!#!6$##

J.6.162. 2!62.# .6.#$6""$

J#?1621 "62!. #?#6#1

16!.262>?

26$$$62.

262?6"$

>226#>!

"?16??" 2>6>2.

#126?"1 2?6$?2

#!!6$2> ..6>.>

1!!61> #6.>1

26".!6""#

26#16.""

.611#62$$

#2!62>>

22?6?># 1$!6$$?

2.#6#11 1116!.#

2>.6"$ 1$?6>#

>262#" 2>62#"

J11!6?!

J12>6##

J1>6$$.

J2"6>1

Operati(g i(0o/e&

21?62$

2..6"1?

2>#6#>?

>.6..

Operati(g 0ash Mow0

2"#6#>"

2?#61..

.1!62#>



 4ear E$ded ebr!ary 28, I(0o/e Net sa*es Other i(0o/e Costs a(' E-pe(ses Cost of sa*es Se**i(g6 ge(era* a(' a'/i(istrati+e e-pe(ses I(terest e-pe(se

Ear(i(gs &efore i(0o/e ta I(0o/e ta-es Net ear(i(gs

So3r0e A((3a* report a(' 1$; a )or the year e('e' )e&r3ary 2!6 1!?? & Operati(g i(0o/e eK3a* to the s3/ of ear(i(g &efore i(0o/e ta-es a(' i(terest e0 Operati(g 0ash Mow eK3a* to the s3/ of operati(g i(0o/e a(' 'epre0iatio( e-pe(

Page 1

E-hi&it #

$ded May " 1988

J##?61$# "6?" #?6!#1 >226!2 2$1612! !61#! #..62>$ >16!$ 2>6#"2 J.$6"?!

>621! 

pe(se *ess other i(0o/e e

Page 1>

E-hi&it ?

Exhibit 8

B!si$ess e/#e$t I$for#atio$

 4ear E$ded ebr!ary 28,

198-

1988

rst 3!arter 198-

J!$#6?.. "16#?> >>?62?" !$6?$ J26?.26.?

J?1#6""$ !?6.2 "".6>21 !"#6.!# J26!"6!$2

J?1.61!? >.262>1 ?!$611 161$>6>". J.6.162.

J1"$6..! 1?61.? 2$!6>.> 2".6$! J#?1621

J""6#1" .26$?> ?6#> 1$>6111 J2>26.?#

J#62"! $6"1$ >261." 12.6#"" J2".6#?1

J2$62$ .!61$1 !262$ 1!6$!$ J.$$6".>

J"#$ 161." 1>6### .?6.1! J"#6>"2

J."61$ .61#

J.261#> .$61".

J2!62.# 26?##

J"62!. 1622?

2>6.?$ 2>6>2.

2">6#!. 2?6$?2

2?"6!!> ..6>.>

>!6"2# #6.>1

1986

Net a)es to 5$a)iated C!sto#ers7 Appare* 9e(era* retai* )ootwear )3r(it3re 5ota*

Oerati$/ Ear$i$/s7 Appare* 9e(era* retai* )ootwear )3r(it3re 5ota* Other i(0o/e Corporate e-pe(se Ear(i(gs &efore i(terest a(' ta-es I(terest e-pe(se

Ear(i(gs &efore i(0o/e ta-es

J22?6?>#

J2.#6#11

J2>.6"$

Ide$tiab)e ssets at 4ear E$d7 Appare* 9e(era* retai* )ootwear )3r(it3re

Corporate Assets 5ota*

J>"6!#2 2.6$$ 2!162!2 "1?6!?$ J16"$162?

J">6"$1 2?6".! !#6#$" "$61$" J16?>26$>2

J2>6.>$ 2>261!> >!>6?"1 "??6?>. J16!"262>!

1>>6">

#.6..>

2.6.2#

J16#>"6?!.

J16!2>6.?#

J16!?>6>?"

Page 1"

J>262#"

E-hi&it ?

Dereciatio$ Exe$se7 Appare* 9e(era* retai* )ootwear )3r(it3re

J116!"> ?62! ?62?" 2$6!#1

J12612. !6$#! 1$6".? 216"#>

J126>21 !6"?1 1.61$# 2"62$?

J1.6.. "61"! ?611 2#62#?

J?6?"! ?61"# #6?" 26#2$

J!622$ 1$6#.> !62." ."61??

Caita) Exe$dit!res7 Appare* 9e(era* retai* )ootwear )3r(it3re

So3r0e 1!?? A((3a* reports a(' 1$;

Page 1#

E-hi&it ?

E$ded May " 1988

J1.?6?." 1!62$! 22"6"#2 2".6.!$ J##?61$#

J2# 126!? 1!6#$$ .261!" J"61# J"6?" !6!2? "16$?. !61#!

J>16!$

Page 1?

E-hi&it ?

Page 1!

E-hi&it !

Exhibit 9

!##ary of the Ta%eo:er O;er

City Caita) ssociates, <=&= O;er

Date

?A3g??

Pri0e per share

J#$,$$

Pre/i3/ to sto07 o(e'ay priora

1#,!$

Pre/i3/ to sto07 o(e/o(th prior

>!,1$

Pre/i3/ to >2wee7 *ow

1.#,.$

Pre/i3/ to >2wee7 high

1#,2$

Va*3e of eK3ity

J26"22,?

Net 'e&t

.1?,>

Va*3e of r/

J26!1,.

a)es

 Fear e('i(g 22!?? Esti/ate of year e('i(g 22?

>a)!e of ir# as a M!)ti)e of7 Oerati$/ Cash )o?

Oerati$/ I$co#e

$,!-

!,2-

11,-

$,!

?,?

1$,#

So3r0e A'apte' with /i(or /o'i0atio(s i( ter/i(o*ogy fro/
Page 2$

E-hi&it !

>a)!e of E@!ity as a M!)ti)e of7 Net Boo%   I$co#e >a)!e

1?,1-

2,2-

1#

2,2

o,6 I(0, prese(tatio( 3rt of Cha(0ery

Page 21

E-hi&it 1$

Exhibit 1

&re#i!#s &aid $a)ysis

 Dea*sa

:era/e &re#i!# &aid o:er toc% &rice O(e Day  22
1; 1!??

1!

"2,.$

!>,>$

1>!,>$

1",#$

2; 1!??

!

"?,"$

!1,.$

1?2,?$

.1,>$

.; 1!??&

12

.",>$

!,!$

1?1,.$

2,"$

1!??

$

>",$$

?$,!$

1#1,.$

1>,?$

1#,!$

>!,1$

1.#,.$

1#,2$

Ra*es

So3r0e
Page 22

E-hi&it 1$

3g3st ?6 1!??, Ci+i* A0tio( Co3(ty6 E-hi&it 2.,

Page 2.

E-hi&it 11

Exhibit 11

Co#arab)e Tra$sactio$ $a)ysis

a, P3r0hase Pri0e 3*tip*es &y B3si(ess Seg/e(t !r$it!re Ma$!fact!ri$/ Co#a$ies

$$o!$ce#e$t Date c@!irorATar/et

//re/ate &rice (0MM*(a*

Net I$co#e

&!rchase Boo%   >a)!e(b*

1211!?#

La:Boyi(0ai'

J".,>$

22,$-

2,1-

111#1!?"

IN5ERCOLa(e

>2.,#

1!,.

2,?

?!,.

1,1

1,?

?121!?"

Chi0ago Pa0i0 9e(era* i**s )3r(it3r

".1!?"

as0oHe(re'o(

2"$,!

.1,"

2,"

??1!??

Ra*es Proposa*

J26!1,.$

1?,1-

2,2-

So3r0e
oot?ear Ma$!fact!ri$/ Co#a$ies

$$o!$ce#e$t Date c@!irorATar/et

//re/ate &rice (0MM*(a*

Net I$co#e

&!rchase Boo%   >a)!e(b*

2>1!??

NIECo*e Haa(

J!>,$$

.",2-

N,,

".1!?#

oa0Korse Shoe

.12,>

2,>

1,?

.1$1!?#

Ree&o7AVIA

1!1

$,"

",#

Page 2

E-hi&it 11

!1?1!?"

Ree&o7Ro07port

1",1

.$,#

N,,

#.11!?"

IN5ERCOCo(+erse

2$2,#

.#,1

1,?

??1!??

Ra*es Proposa*

J26!1,.$

1?,1-

2,2-

So3r0e
Exhibit 11 (co$ti$!ed*

Co#arab)e Tra$sactio$ $a)ysis

are) Co#a$ies

$$o!$ce#e$t Date c@!irorATar/et

2?1!??

esray
//re/ate &rice (0MM*(a*

Net I$co#e

&!rchase Boo%   >a)!e(b*

J1>#,$

N,,

1,"-

221!??

a*a(ta(hatta( I('3

12!,#

N,,

1,

.1#1!?"

< A0K3isitio(
>$,#

21

2,>

111!?>


>>1,!

1!,"

1,>

Ra*es Proposa*

J26!1,.$

1?,1-

2,2-

??1!??

So3r0e
Page 2>

E-hi&it 11

Ce$tra) 'ard?are Di:isio$

//re/ate &rice (0MM*(a*

Net I$co#e

&!rchase Boo%   >a)!e(b*

a(age/e(t 9ro3p Pay*ess Cashways

J161?!,$

22,$-

2,.-

Ra*es Proposa*

J26!1,.$

1?,1-

2,2-

$$o!$ce#e$t Date c@!irorATar/et

"21!??

??1!??

So3r0e
Exhibit 11 (co$ti$!ed*

Co#arab)e Tra$sactio$ $a)ysis

&, Va*3e Ra(ges &y B3si(ess Seg/e(t

B!si$ess e/#e$t

Appare* 9e(era* retai* )ootwear )3r(it3re

B!si$ess e/#e$t

Appare*

1988 a)es

M!)ti)e Ra$/e

>a)!e Ra$/e

Media$ >a)!e

J?1.,2$ >.2,. ?!$, 161$>,"$

,  ,! ,"  ," ,>  2,1 ,?  2,1

J .2>,.  J #.1,! .1!,  .1!, >,2  16?"!,? ??,>  26.21,? J16!#,  J>622,!

J>"!,2$ .1!, 16..>,"$ 16.#,.$ .6""1,>$

1988 Oerati$/ I$co#e

M!)ti)e Ra$/e

>a)!e Ra$/e

Media$ >a)!e

J2$,2$

1$,"  2,$

J 21,1  J ?,?

J21,1$

Page 2"

E-hi&it 11

9e(era* retai* )ootwear )3r(it3re

B!si$ess e/#e$t

Appare* 9e(era* retai* )ootwear )3r(it3re

.!,1 !2,2 1!,1

1.,1  1.,1 1.,$  2",$ 11,1  2$,.

>12,2  >12,2 161!?,"  26.!#,2 J16">>,$  J.6$2",# J.6>#!,!  J"62$,!

>12,2 262"?,1$ 16#"",?$ J6#"1,2$

1988 Oerati$/ Cash )o?

M!)ti)e Ra$/e

>a)!e Ra$/e

Media$ >a)!e

J.2,#$ ?,? 1$>,. 1#>,.

!,2  1.,# !,2  !,2 !,2  2.,! ?,1  1>,?

Page 2#

J .$$,?  ?,!  !"?,?  J161!,!  J.61.?, 

J ?,$ ?,! 26>1",# J26#"!,# J"61?.,.

J.$$,?$ ?,! !#$,# 16#$!,2$ J.62!,"$

E-hi&it 11

rice M!)ti)es(a* Oerati$/ a)es I$co#e

Oerati$/ Cash )o?

$,?-

11,#-

?,1-

1,"

11,1

!,"

1

12

!,!

2,1

2$,.

1>,?

$,!-

11,-

!,2-

st ?6 1!??, Ci+i* t*e Co3(ty6 E-hi&it 2., 'e&t o3tsta('i(g

rice M!)ti)es(a* Oerati$/ a)es I$co#e

Oerati$/ Cash )o?

1,>-

1,1

12,2

$,>

1.

!,2

2,1

2,"

2.,.

Page 2?

E-hi&it 11

1,#

2"

2.,!

$,!

2,#

1?,2

$,!-

11,-

!,2-

st ?6 1!??, Ci+i* t*e Co3(ty6 E-hi&it 2., 'e&t o3tsta('i(g

rice M!)ti)es(a* Oerati$/ a)es I$co#e

Oerati$/ Cash )o?

$,?-

2,$-

1.,#-

$,

N,,

N,,

$,!

1$,"

!,2

$,"

1$,"

!,2

$,!-

11,-

!,2-

st ?6 1!??, Ci+i* t*e Co3(ty6 E-hi&it 2., 'e&t o3tsta('i(g

Page 2!

E-hi&it 11

rice M!)ti)es(a* Oerati$/ a)es I$co#e

Oerati$/ Cash )o?

$,"-

1.,1-

!,2-

$,!-

11,-

!,2-

st ?6 1!??, Ci+i* t*e Co3(ty6 E-hi&it 2., 'e&t o3tsta('i(g

Page .$

E-hi&it 11

Page .1

E-hi&it 12

Exhibit 12

Disco!$ted Cash )o? $a)ysis

ss!#tio$s

Sa*es growtha Operati(g /argi( ra(ge& Capita* e-pe('it3res0 I(0rease i( wor7i(g i(+est/e(t

!r$it!re ro! oot?ear ro! are) ro!

#,#$

",.$

#,1$

1.,11,1

!,11$,

",#,$

1-

1-

1-

12,>$

12,>$

12,>$

 5a- rate

M!)ti)e of Cash )o? i$ 4ear 1  1.=x 1=x 16=x  5er/i(a* +a*3e J /i**io(s

6#",$$

>6$?>,$$

>62,$$

I/p*ie' sto07 pri0e Dis0o3(t rate 1$,$$ 11,$$ 12,$$ 1.,$$

J?$,$$ # "? ".

J?,$$ ## #2 ""

J??,$$ ?1 #> "!

So3r0e A'apte' with /i(or /o'i0atio(s i( ter/i(o*ogy fro/
5e(year a((3a* 0o/po3(' growth rate ProQe0te' operati(g /argi( i( 1!?! a(' i( 1!!? As a /3*tip*e of 'epre0iatio( As a per0e(t of the 0ha(ge i( sa*es i( 1!! forwar'

Page .2

E-hi&it 12

Retai) ro!

Tota)

#,"$

#,2$

",>#,>

!,21$,1

1-

1-

#,>$

11,"$ 1,$$

6 I(0, prese(tatio( to the I(ter0o f the State of De*aware i( a('

Page ..

E-hi&it 1.

Exhibit 1"

Refere$ce Ra$/e Retai$ Core Co#a$ies Case (0 #i))io$s Excet &er 

e/#e$t

)3r(it3re 9ro3p )ootwear 9ro3p  5ota* Afterta- Di+estit3re Pro0ee's Net Corporate A'Q3st/e(tsa Ra(ge Per Share Ra(ge&

Ra$/e

J16>2>  J16#>$ ##> 

!$$

J26.$$  J26">$ J >??  J ".! ..> 

2#.

J26>>.  J.6$1" J"?,$$  J?$,$$

So3r0e /i**io( f3**y'i*3te' shares o3tsta('i(g

Page .

E-hi&it 1.

 

are*

6 1!??, Ci+i* A0tio( No, 1$116 *e' i( the Co3rt of Cha(0ery of the State of De*aware i o3(ty6 E-hi&it 2., * estate whi0h 0o3*' &e 3('erstate'

Page .>

E-hi&it 1.

a(' for New Cast*e Co3(ty6 E-hi&it 2.,

Page ."