OVERVIEW January 2014

1. OVERVIEW January 2014 PayCheck Direct® is operated by Bluestem Enterprises, Inc.

2. Agenda • Introductions • PayCheck Direct Overview • Program Specifics • Walk-through of site • Merchandising and Pricing • Marketing and Implementation • Wrap-up

3. PayCheck Direct enables employees to buy what they need when they need it through the convenience of payroll deduction • No cost, easy-to-implement benefit for your employees • Easy approval process – no credit check • Avoids predatory practices of credit card and rent-to-own companies • No hidden/surprise fees or interest charges • Especially helpful for those with no credit history • Improves employee financial well-being 12 Months Easy online and phone shopping Simplified approval Process Convenient home delivery Payroll deduction – no writing checks, no online payments No revolving balances with high interest rates and fees http://www.mypaycheckdirect.com/overview-video/

4. Key member value considerations for PayCheck Direct

5. A No Cost Solution That Will Benefit Your Entire Workforce Because of their job… they can • Make a large purchase when cash & credit is not available • Avoid costly alternatives – responsible purchase solution • Get superb convenience and value ONLYsolution for some • Great solution when you WANT • Competitive pricing • Interest free opportunity- Simple and worry free convenience • Save money and build for the future 64% NEEDto utilize a source other than savings to satisfy a $1,000 unplanned expense* 0% 25% 50% 100% 75% - Employee Relevance Spectrum - *National Foundation for Consumer Credit Counseling survey July, 2011.

6. Our customers understand the value proposition and appreciate the easy payment options. We asked the question – “What motivated you to purchase? “Reasonable price and payment plan” “I have wanted one for a long time and I finally could afford it through this program.” “The fact that it would be taken directly out of check.” “Wanted a new TV and liked that it was automatically withdrawn from my checks. Thought it would be easier not to miss the money when I don't see it in the first place” “Price comparing with local retailers on same item & no interest as opposed to using a credit card” “Price, no interest and low payments” “Higher priced items with $$ taken out of my paycheck over 12 months, worked for us.” “Liked the fact of smaller payments and that they are taken out of my weekly paycheck” Source: PayCheck Direct CSAT survey August, 2013

7. PayCheck Direct is part of a $700MM retailer committed to a no-hassle customer experience Bluestem Family of Companies Customer Satisfaction Index* • PayCheck Direct is part of Bluestem Enterprises, Inc., a subsidiary of Bluestem Brands, Inc. – 10 years in business. • Our company is proud to serve millions of customers and has an ACSI score of 84 to reflect their satisfaction – one of the highest in the US.* • For the employer, we assign an account manager with full cross-functional support. • For the employee, toll-free customer support is available to handle all customer needs. • We offer a very customer-friendly return policy. * Source: ACSI proprietary research fielded in Q4, 2012 via telephone and email

8. The Bluestem family of companies, an experienced partner with a 60 year history Distribution Center Top 100 retailer nationally • 3rd largest e-commerce retailer in MN • Distribute nearly 100 Million product catalogs annually • Vendor network of more than 1,400 suppliers • Offer more than 50,000 products • Shipped more than 4 MM products in 2012 from our own warehouse • Serve >3 million customers nationwide • Winner of the Governor’s Safety Award 7 consecutive years. • Winner Top Places to Work in 2013

9. Our Clients

10. We offer a wide variety of merchandise categories to meet your employee’s needs.

11. We continually evolve our assortment with the customer in mind • Experienced Merchandising team at headquarters • Assortment focused on categories of products that employees want and need • High quality, relevant products that employees will enjoy for years to come • Our merchants source the best products from vendors at markets all over the world • Half of our products ship from state of the art warehouse • Tight controls on products shipped by vendor partners • Pricing is competitive with where and how customer shops • Each new item analyzed at time of set up • Regular competitive reviews with resulting pricing adjustments

12. For big-ticket purchases where financing is needed, PayCheck Direct is the best option Pricing comparisons completed 11/18/13 Interest rate calculated based on 23.64% APR with a payoff time period of 12 months. Comparecards.com range for low average FICO Score 23.64% as of 11/18/13.

13. What do employers need to do in support of this program? • Our goal is for the employer to do very little • We meet jointly to discuss implementation • We are able to roll it out when it works best for you since it’s not tied to open enrollment periods as there is no enrollment process • Employer provides a Census File for order validation • Usually requires approximately 15 – 20 minutes per payroll period to process new records for new orders

14. What does the employee need to do to participate? • The employee shops online or by phone. • They register with PayCheck Direct when they place their order. • We validate employment information through the census file. • The order is processed and shipped to the employee’s home. • Payroll deductions begin and continue for 12 months of payroll periods. • No checks to write!

15. How does an employee qualify? • No credit check is required to make a purchase • To be eligible an employee must: • Be a full-time employee • Be at least 18 years of age • Meet the minimum salary requirement of $18,000 per year • Have a tenure of at least six months

16. If an employee leaves, does the employer end up paying the balance? • No. The employer has no liability for the employees’ obligations • When an employee leaves your company, PayCheck Direct will work with the employee to obtain payment for the item • We’ll work with the employee to pay the remaining by providing them with alternative payment options • We just ask the employer to provide most current information for the terminated employee

17. What if an employee goes on leave? • If a leave is 90 days or less, we will push out the payment period for the employee. • For leaves greater than 90 days, we will bill the employee directly after the first 90 days until they return to work. • When they return to work, payroll billing will resume.

18. Are we allowing/encouraging employees to get in over their heads? • PayCheck Direct believes in responsible lending. • Our purchasing tiers are designed to not exceed 3.5 – 4.0% of gross pay and in most cases are less than 3%.

19. What does your marketing plan include? The key to successful employee engagement and usage of the program is communication. PayCheck Direct will create a program for communicating out the program to your employees. The program will be submitted for your approval prior to execution. Below is an example of a recommended program for a typical calendar year:

20. What marketing communications are presented to our employees? • The website and catalog are co-branded • 3-4 catalog mailings per year • Opportunities exist for messaging to employees through catalogs, email and online • Ample opportunity is available for reinforcing your presence with your employees in these communications. Client Logo

21. What do you expect usage/penetration to be? • An employer can expect employee usage to be 10 - 20% or higher each year with high repurchase rates. • The key to success is in the communication plan approved by the employer. • Program brochures will be developed for distribution during annual open enrollment. • Catalogs will be delivered to employees 3-4 times per year. • Email templates will be created for the program. • PayCheck Direct or employers can send periodic employee emails. • Periodic emails will be made available for hot deals, newsletters, reminders and other program appropriate correspondence.

22. How do we differentiate ourselves from our competition? As of March 1, 2013

23. We are focused on providing an excellent experience for your members • Members may order either on the web or over the phone – 87% of our orders are through the website today • 30-day return policy is standard • Customer Service team is located in our Eden Prairie facility – as we expand we will continue to service onshore • Hours are expanding to 8:30 AM to 8PM CT Beginning in late October • Email available as well at customer.service@mypaycheckdirect.com • Voicemail is also available 24/7 and will be responded to next business day • All orders are followed up with a Customer Satisfaction Survey (CSAT) – results reviewed with the PayCheck Direct team • Members with open orders leaving their employer are given three options for paying off their order • Pay off the balance in full on a credit card • Pay a monthly payment on their credit card • Pay a monthly payment via check (they will receive a statement)

24. Does PayCheck Direct operate in a secure environment? PayCheck Direct is committed to working in a secure environment. We are classified as a level 3 merchant for PCI (Payment Card Industry) compliance. • Installed perimeter firewalls between any wireless networks and the customer data environment, and configured these firewalls to deny or control any traffic from the wireless environment into the customer data environment. • Do not allow any direct routes inbound or outbound for traffic between the Internet and the customer data environment. • Appropriate facility entry controls are in place to limit and monitor physical access to systems in the customer data environment. • Intrusion-detection and/or prevention systems are in-place and up-to-date and used to monitor all traffic in the customer data environment alerting personnel to suspected compromises. • All users are assigned a unique ID before allowing them to access system components or customer data. Passwords must be changed at least every 90 days. Terminated employee privileges are revoked immediately. • All client data for PayCheck Direct employers/employees is firewalled and only used for purposes of conducting business provided for under client agreements.

25. How can PayCheck Direct afford to do this without charging interest? • The likelihood of repayment is substantially higher when payments are made via payroll deduction • This allows us to take on customers without a credit check, making the program available to the broadest possible audience • This significantly reduces the cost of collecting payments and losses associated with bad debt • Employer access to employees reduces marketing costs We pass these savings on to your Employees

26. How did PayCheck Direct decide to enter this business? • We saw a market emerging as a result of the economy and changing perception of other forms of financing. • Existing firms in this space are small and lack the ability to leverage our scale and customer service platforms. • Financial stress on the part of consumers, which decreases productivity at work, is unfortunately growing, creating a real need for new alternatives.

27. PayCheck Direct looks forward to a strong partnership with your organization • Best in class program • Diligent focus on the customer’s experience • Promote membership messaging • Account Manager support • Full support team behind the program • Highly responsive organization