SENIOR NOTES CONVERSION

NOTICE OF RIGHT TO CONVERT 2.00% CONVERTIBLE SENIOR NOTES

Pursuant to Section 9.1 of the Indenture, dated as of March 23, 2004, among Saks Incorporated (the “Company”), the Subsidiary Guarantors named therein, as guarantors, and The Bank of New York Trust Company, N.A. as trustee (the “Indenture”), the Company hereby notifies holders of its $230 million 2.00% Convertible Senior Notes due March 15, 2024 (the “Convertible Notes”) that they are entitled to convert the Convertible Notes into shares of the Company’s common stock, subject to the terms of the Indenture, due to recent downgrades of the Convertible Notes by Moody’s and Standard & Poor’s.

Holders of the Convertible Notes desiring to exercise their conversion right should contact The Bank of New York Trust Company, N.A., the Conversion Agent for the Convertible Notes, at the following address:

The Bank of New York
Reorganization Department - 7E
101 Barclay Street
New York, NY 10286
Phone: 212-815-2742