Contract analysis

I. Executive Summary The purpose of this memorandum is to analyze the applicability of the Foreign Investment in Real Property Tax Act of 1980 ("FIRPTA"), as codified in Sections 897 and 1445 of the Internal Revenue Code of 1986, as amended (the "Code" or "IRC"), to the proposed acquisition by Cascade Retail Holdings Inc. ("Cascade," "CRH," or the "Buyer"), a Delaware corporation publicly traded on the Nasdaq Stock M

II. Background of the Transaction A. Transaction Structure The Transaction is structured as a stock purchase in which Cascade will acquire 100% of the issued and outstanding capital stock of NovaMart from the Selling Stockholders. The Transaction is not structured as an asset purchase, a merger, or any other form of business combination. No election under IRC Section 338(h)(10) is contemplated in connection with the

1. Ridgeline Equity Partners, LP — a Delaware limited partnership (EIN 83-4127896), holding approximately 41.2% of NovaMart's outstanding common stock. Ridgeline's principal place of business is located at 200 Park Avenue South, 14th Floor, New York, New York 10003. Ridgeline is a domestic entity organized under the laws of the State of Delaware and is not a foreign person for purposes of FIRPTA.

2. Brindoval Ventures Fund III, LP — a Delaware limited partnership (EIN 94-6238154), holding approximately 22.8% of NovaMart's outstanding common stock. Brindoval's principal place of business is located at 555 Mission Street, Suite 2900, San Francisco, California 94105. Brindoval is a domestic entity organized under the laws of the State of Delaware and is not a foreign person for purposes of FIRPTA.

3. Julian Reeves — an individual, United States citizen, Founder and Chief Executive Officer of NovaMart, holding approximately 18.5% of NovaMart's outstanding common stock. Mr. Reeves resides in Austin, Texas.

4. Priya Narasimhan — an individual, United States citizen, Co-Founder and Chief Technology Officer of NovaMart, holding approximately 8.3% of NovaMart's outstanding common stock. Ms. Narasimhan resides in Austin, Texas.

5. Other management and employee stockholders — holding approximately 9.2% of NovaMart's outstanding common stock in the aggregate, including shares issuable upon exercise of vested stock options under NovaMart's 2018 Equity Incentive Plan. Based on a review of NovaMart's capitalization table, employment records, and W-9 forms collected in connection with due diligence, all of these stockholders are believed to be U.

III. Statutory Framework — FIRPTA and IRC Section 1445 A. Overview of FIRPTA (IRC Section 897) The Foreign Investment in Real Property Tax Act of 1980 ("FIRPTA") was enacted to ensure that foreign persons who invest in U.S. real property are subject to U.S. federal income tax on gains derived from the disposition of such property. Prior to the enactment of FIRPTA, foreign investors could in many cases dispose of U.S.

IV. Analysis — Applicability of FIRPTA Withholding to the NovaMart Acquisition A. NovaMart's Status as a Domestic Corporation NovaMart Global Inc. is a corporation organized and existing under the laws of the State of Delaware. NovaMart's status as a Delaware corporation has been confirmed through a Certificate of Good Standing issued by the Delaware Secretary of State, which has been obtained as part of the due dili

V. Recommended Approach — Non-Foreign Person Certificate A. Entity-Level Certificate from NovaMart Based on the analysis set forth in this memorandum, we recommend that NovaMart Global Inc. deliver to Cascade at closing a FIRPTA Non-Foreign Person Certificate in accordance with Treasury Regulations Section 1.1445-2(b)(2). The certificate is the most efficient and reliable mechanism for eliminating Cascade's withholdi

VI. Treatment of Escrow Amount As described in Section II.A above, $96,000,000 of the aggregate purchase price (representing 8% of $1,200,000,000) will be deposited into an indemnification escrow account maintained by Marlowe Asset Management Trust Company, N.A. (contact: Patricia Keane, Vice President, Escrow Services). The escrow is being established to secure the Selling Stockholders' indemnification obligations u

VII. State Tax Considerations FIRPTA is exclusively a federal tax regime. There is no state-level equivalent of FIRPTA, in the sense that no state imposes a tax on foreign persons' dispositions of interests in real property holding corporations that mirrors the federal FIRPTA framework. However, several states impose withholding requirements on non-residents (including foreign persons and out-of-state domestic person

VIII. Form of FIRPTA Non-Foreign Person Certificate A form FIRPTA Non-Foreign Person Certificate has been prepared by Calderwood & Harkness LLP as a separate closing deliverable and is designated as Document 66 in the master closing checklist. The form certificate will be circulated to NovaMart's counsel at Calloway, Brandt & Loewe LLP (Richard Calloway and Simone Adesanya) for review and comment in advance of closin

IX. Risk Factors and Contingencies A. Failure to Deliver Certificate The principal risk identified in this memorandum is the failure by NovaMart to deliver the FIRPTA Non-Foreign Person Certificate at closing. If NovaMart were to fail or refuse to deliver the certificate, Cascade would be without the regulatory safe harbor provided by Treasury Regulations Section 1.1445-2(b)(2) and would be obligated to withhold 15%

X. Coordination with Other Tax Matters This memorandum addresses exclusively the FIRPTA withholding analysis applicable to the Transaction. Several related tax matters are addressed in separate memoranda and documents prepared by the undersigned and the Calderwood & Harkness tax group: Tax Structure Memorandum. The overall tax structure of the Transaction — including the treatment of the Transaction as a stock purcha

XI. Action Items and Recommendations Based on the analysis set forth in this memorandum, we recommend the following action items:

1. Finalize the Form FIRPTA Non-Foreign Person Certificate. The draft form certificate (Document 66 in the closing checklist) should be finalized and circulated to NovaMart's counsel at Calloway, Brandt & Loewe LLP (Richard Calloway and Simone Adesanya) for review and comment. Any comments should be reviewed by the Calderwood & Harkness tax group to ensure that the certificate complies with the requirements of Treasu

2. Include the FIRPTA Certificate in the Master Closing Checklist. The FIRPTA Non-Foreign Person Certificate should be included as a required closing deliverable under SPA Article VII and should be tracked on the master closing checklist as Document 66. Responsibility for delivery should be assigned to NovaMart's counsel.

3. Confirm the Identity of the Signing Officer. Coordination with NovaMart should confirm whether the FIRPTA certificate will be signed by Douglas "Doug" Whitfield, CFO, or Amanda Trevino, General Counsel (or another authorized officer). The signing officer should be identified in advance of closing to avoid last-minute delays.

4. Cascade to Retain the Executed Certificate. Upon receipt of the executed FIRPTA certificate at closing, Cascade must retain the original certificate for a period of five (5) years following the calendar year in which the closing occurs, as required by Treasury Regulations Section 1.1445-2(b)(3). We recommend that the certificate be maintained in Cascade's permanent tax files and that a copy be included in the clos

5. Obtain Bring-Down Confirmation. A bring-down confirmation from NovaMart's General Counsel, Amanda Trevino, should be obtained at or immediately prior to closing, confirming that no foreign persons have been identified among NovaMart's stockholders, option holders, or other equity holders as of the closing date. This confirmation is a precautionary measure that supplements the entity-level FIRPTA certificate.

6. No IRS Withholding Certificate Application. No application for a withholding certificate under IRC Section 1445(b)(4) is necessary or recommended in connection with this Transaction. The non-foreign person certificate is the appropriate and sufficient mechanism for avoiding withholding.

7. No FIRPTA Withholding at Closing. No FIRPTA withholding should be deducted from the purchase price or the escrow amount at closing, provided the NovaMart FIRPTA Non-Foreign Person Certificate is duly executed and delivered. The full purchase price of $1,200,000,000 should be distributed in accordance with the funds flow memorandum without any FIRPTA reduction.

XII. Conclusion Based on the foregoing analysis, FIRPTA withholding under IRC Section 1445 is not required in connection with the acquisition by Cascade Retail Holdings Inc. of 100% of the outstanding capital stock of NovaMart Global Inc., provided that NovaMart delivers a duly executed non-foreign person certificate at closing in the form prepared by Calderwood & Harkness LLP and in compliance with Treasury Regulati

XIII. Contact Information Please direct any questions regarding this memorandum to: Sylvia Hartwell Partner, Tax Group Calderwood & Harkness LLP 599 Lexington Avenue, 38th Floor New York, New York 10022 Telephone: (212) 555-7800 Email: shartwell@calderwoodharkness.com Sandra Chiu Engagement Partner Whitmore & Paige LLP 100 Federal Street, Suite 2500 Boston, Massachusetts 02110 Telephone: (617) 555-3200 Email: schiu@w