SC 13E3/A

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13E-3

RULE 13e-3 TRANSACTION STATEMENT
(Pursuant to Section 13(e) of the Securities Exchange Act of 1934)

(Amendment No. 5)

SHOPKO STORES, INC.

(Name of the Issuer)

ShopKo Stores, Inc.
Badger Retail Holding, Inc.
Badger Acquisition Corp.
Goldner Hawn Johnson & Morrison Incorporated
Marathon Fund Limited Partnership V
Miltiades Limited Partnership
Marathon Ultimate GP, LLC
Jack W. Eugster

(Name of Person(s) Filing Statement)

Common Stock, par value $0.01 per share

(Title of Class of Securities)

824911101

(CUSIP Number of Class of Securities)

ShopKo Stores, Inc.	Badger Retail Holding, Inc.	Jack W. Eugster
Attention: Steven R. Andrews, Esq.	Badger Acquisition Corp.	c/o ShopKo Stores, Inc.
700 Pilgrim Way	Goldner Hawn Johnson & Morrison Incorporated	700 Pilgrim Way
Green Bay, Wisconsin 54304	Marathon Fund Limited Partnership V	Green Bay, Wisconsin 54304
Telephone: (920) 429-2211	Miltiades Limited Partnership	Telephone: (920) 429-2211
	Marathon Ultimate GP, LLC
	c/o Goldner Hawn Johnson & Morrison Incorporated
	3700 Wells Fargo Center
	90 South Seventh Street
	Minneapolis, Minnesota 55402
	Telephone: (612) 338-5912

(Name, Address and Telephone Number of Person Authorized To Receive Notices
and Communications on Behalf of Persons Filing Statement)

	Copies to:
Thomas A. Cole, Esq. Dennis V. Osimitz, Esq. Sidley Austin Brown & Wood LLP Bank One Plaza 10 South Dearborn Street Chicago, Illinois 60603 Telephone: (312) 853-7000	Eileen T. Nugent, Esq. Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036 Telephone: (212) 735-3000	James C. Melville, Esq. Kaplan Strangis & Kaplan, P.A. 5500 Wells Fargo Center 90 South Seventh Street Minneapolis, Minnesota 55402 Telephone: (612) 375-1138

       This statement is filed in connection with (check the appropriate box):

þ	a.	The filing of solicitation materials or an information statement subject to Regulation 14A, Regulation 14C or Rule 13e-3(c) under the Securities Exchange Act of 1934.
o	b.	The filing of a registration statement under the Securities Act of 1933.
o	c.	A tender offer.
o	d.	None of the above.
		Check the following box if the soliciting materials or information statement referred to in checking box (a) are preliminary copies:  o
		Check the following box if the filing is a final amendment reporting the results of the transaction:  o

Calculation of Filing Fee

Transaction Valuation*	Amount of Filing Fee**
$735,981,173	$86,625

*Calculated solely for purposes of determining the filing fee. The transaction value was determined by adding (A) the product of 30,095,018 shares of ShopKo common stock multiplied by the merger consideration of $24.00 per share, plus (B) $13,700,740.75 expected to be paid upon cancellation of outstanding options.

**The filing fee, calculated in accordance with Exchange Act Rule 0-11(c)(1), was calculated by multiplying the transaction value by 0.0001177.

þ  Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

Amount Previously Paid:	$86,625
Form or Registration No.:	Schedule 14A
Filing Party:	ShopKo Stores, Inc.
Date Filed:	June 13, 2005

TABLE OF CONTENTS

	Item 1. Summary Term Sheet
	Item 2. Subject Company Information
	Item 3. Identity and Background of Filing Person
	Item 4. Terms of the Transaction
	Item 5. Past Contacts, Transactions, Negotiations and Agreements
	Item 6. Purposes of the Transaction and Plans or Proposals
	Item 7. Purposes, Alternatives, Reasons and Effects
	Item 8. Fairness of the Transaction
	Item 9. Reports, Opinions, Appraisals and Certain Negotiations
	Item 10. Source and Amounts of Funds or Other Consideration
	Item 11. Interest in Securities of the Subject Company
	Item 12. The Solicitation or Recommendation
	Item 13. Financial Information
	Item 14. Person/Assets, Retained, Employed, Compensated or Used
	Item 15. Additional Information
	Item 16. Exhibits.
EXHIBIT INDEX
Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated
Illustrative Analysis prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated

SCHEDULE 13E-3

Introduction

     This Amendment No. 5 to Rule 13e-3 Transaction Statement on Schedule 13E-3 (this “Statement”) is being filed with the Securities and Exchange Commission (the “SEC”) pursuant to Section 13(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), by (1) ShopKo Stores, Inc., a Wisconsin corporation (“ShopKo”), the issuer of common stock, par value $0.01 per share (the “Common Stock”), that is subject to the Rule 13e-3 transaction, (2) Badger Retail Holding, Inc., a Delaware corporation (“Badger Retail Holding”), (3) Badger Acquisition Corp., a Wisconsin corporation (“Badger Acquisition”), (4) Goldner Hawn Johnson & Morrison Incorporated, a Minneapolis-based private equity firm (“Goldner Hawn”), (5) Marathon Fund Limited Partnership V, a Delaware limited partnership (“Marathon”), (6) Miltiades Limited Partnership, a Delaware limited partnership (“Miltiades”), (7) Marathon Ultimate GP, LLC, a Delaware limited liability company (“Marathon Ultimate” and, together with Goldner Hawn, Marathon and Miltiades, the “GHJM Investors”), and (8) Mr. Jack W. Eugster (each a “Filing Person” and collectively, the “Filing Persons”).

     On April 7, 2005, Badger Retail Holding, Badger Acquisition and ShopKo entered into an Agreement and Plan of Merger (the “Original Merger Agreement”). On September 9, 2005, the parties entered into a First Amendment to Agreement and Plan of Merger (the “Merger Agreement Amendment”) amending the Original Merger Agreement. The Original Merger Agreement, as amended by the Merger Agreement Amendment, is referred to as the “Merger Agreement” in this Statement. Pursuant to the Merger Agreement, Badger Acquisition will merge with and into ShopKo, with ShopKo continuing as the surviving corporation (the “Merger”). In connection with the Merger, each share of Common Stock issued and outstanding immediately prior to the effective time of the Merger (other than shares held as treasury shares or by any subsidiary of ShopKo, by Badger Retail Holding or by Badger Acquisition) will be converted into the right to receive $25.00 in cash. The Merger Agreement also provides that upon completion of the Merger, all options to acquire shares of Common Stock that are outstanding immediately prior to the effective time of the Merger, whether or not exercisable, will be canceled as of the effective time of the Merger in exchange for a cash payment. Pursuant to the Merger Agreement, each option holder will receive a payment equal to $25.00 times the number of shares of Common Stock subject to each option, less the aggregate exercise price of the option; provided, however, that immediately following the Merger, Badger Retail Holding will cause ShopKo to pay to any optionee who would otherwise receive no payment or less than $100 in respect of an option grant a minimum payment of $100 with respect to any such option grant. All payments made in respect of options will be subject to applicable withholding taxes.

     As a result of the Merger, current shareholders of ShopKo, other than Jack W. Eugster, who will invest in the equity securities of Badger Retail Holding, and Shopko’s executive officers and certain other selected employees who will have an opportunity to invest up to $3 million (in the aggregate for all such persons) in the common equity of Badger Retail Holding and will be eligible to participate in the stock option plan of Badger Retail Holding, will cease to have ownership interests in ShopKo or rights as shareholders of ShopKo, and will not participate in any future earnings or growth of ShopKo or benefit from any appreciation in value of ShopKo. Although, as of the date of this Statement, none of ShopKo’s executive officers or employees has committed to invest in Badger Retail Holding following the merger, the following executive officers and employees of ShopKo, on the basis of potential investments in Badger Retail Holding and options to purchase shares of Badger Retail Holding which Badger Retail Holding currently plans to grant to them, may in the aggregate indirectly own up to 11.1% of the shares of common stock of ShopKo on a fully diluted basis following the Merger: Messrs. Steven R. Andrews, Brian W. Bender, Michael J. Bettiga, Oscar Cavazos, Larry L. Gentry, Michael J. Hopkins, Rodney D. Lawrence, Matthew J. Lynch, Samuel M. Martin, III, Peter J. O’Donnell, Paul Rothamel, Paul G. White and Douglas N. Wurl and Ms. Lynn E. Hempe.

     ShopKo has filed with the SEC a definitive proxy statement (the “Definitive Proxy Statement”) under Regulation 14A of the Exchange Act relating to the special meeting of the shareholders of ShopKo originally scheduled to be held on September 14, 2005 for the purpose of allowing the shareholders of ShopKo to consider and vote upon the proposal to approve the Original Merger Agreement. A copy of the Definitive Proxy Statement is attached hereto as Exhibit (a)(3). A copy of the Original Agreement is attached to the Definitive Proxy Statement as Appendix A and is incorporated herein by reference. The special meeting was convened on September 14, 2005, as originally scheduled, and adjourned until a later date by the chairman of the special meeting to allow for the preparation and filing of supplemental proxy materials with the SEC to allow the shareholders of ShopKo sufficient time to review the supplemental proxy materials. On September 16, 2005, ShopKo publicly announced that the special meeting would be reconvened on October 10, 2005.

     Immediately before the filing of this Statement, ShopKo filed a supplement to the Definitive Proxy Statement (the “Proxy Supplement” and, collectively with the Definitive Proxy Statement, the “Proxy Statement”) under Regulation 14A of the Exchange Act relating to the reconvened special meeting of the shareholders of ShopKo to consider and vote upon the proposal to approve the Merger Agreement. A copy of the Proxy Supplement is attached hereto as Exhibit (a)(6). A copy of the Merger Agreement Amendment is attached to the Proxy Supplement as Appendix A and is incorporated herein by reference. At the special meeting, the approval of the Merger Agreement requires the affirmative vote of shareholders holding a majority of the shares of Common Stock outstanding as of the close of business on the record date of August 1, 2005.

     The cross references below are being supplied pursuant to General Instruction G to Schedule 13E-3 and show the location in the Definitive Proxy Statement or the Proxy Supplement, as applicable, of the information required to be included in response to the items of Schedule 13E-3. The information in the Definitive Proxy Statement and the Proxy Supplement, including all appendices thereto, is expressly incorporated by reference herein in its entirety, and responses to each item herein are qualified in their entirety by the information contained in the Definitive Proxy Statement and the Proxy Supplement and the appendices thereto. Capitalized terms used but not defined herein have the meanings given to them in the Proxy Statement and the Proxy Supplement.

     All information contained in, or incorporated by reference into, this Statement concerning any of the Filing Persons has been provided by such Filing Person and no other Filing Person, including ShopKo, makes any representation as to the accuracy of any information not supplied by such Filing Person.

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     The filing of this Statement will not be construed as an admission by any Filing Person or by any affiliate of a Filing Person that ShopKo is “controlled” by or under common “control” with any other Filing Person or that any other Filing Person is an “affiliate” of ShopKo within the meaning of Rule 13e-3 of the Exchange Act.

Item 1. Summary Term Sheet.

Regulation M-A Item 1001

The information set forth in the Definitive Proxy Statement under the caption “Summary Term Sheet” and in the Proxy Supplement under the caption “Update to the Summary Term Sheet” is incorporated herein by reference.

Item 2. Subject Company Information.

Regulation M-A Item 1002

(a) Name and Address. ShopKo’s name and the address and telephone number of its principal executive offices are as follows:

ShopKo Stores, Inc.
700 Pilgrim Way
Green Bay, Wisconsin 54304
(920) 429-2211

(b) Securities. The information set forth in the Definitive Proxy Statement under the caption “The Special Meeting – Record Date and Voting Information” is incorporated herein by reference.

(c) Trading Market and Price. The information set forth in the Proxy Supplement under the caption “Markets and Market Price” is incorporated herein by reference.

(d) Dividends. The information set forth in the Proxy Supplement under the caption “Markets and Market Price” is incorporated herein by reference.

(e) Prior Public Offerings. None.

(f) Prior Stock Purchases. The information set forth in the Definitive Proxy Statement under the caption “Transactions in ShopKo Common Stock – Purchases” and in the Proxy Supplement under the caption “Transactions in ShopKo Common Stock – Purchases” is incorporated herein by reference.

Item 3. Identity and Background of Filing Person.

Regulation M-A Item 1003

(a) Name and Address. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Parties Involved in the Proposed Transaction”

“Directors and Executive Officers”

The information set forth in the Proxy Supplement under the caption “Update to the Summary Term Sheet” is incorporated herein by reference.

3

(b) Business and Background of Entities. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Parties Involved in the Proposed Transaction”

“Directors and Executive Officers”

The information set forth in the Proxy Supplement under the caption “Update to the Summary Term Sheet” is incorporated herein by reference.

(c) Business and Background of Natural Persons. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference.

“Parties Involved in the Proposed Transaction”

“Directors and Executive Officers”

Item 4. Terms of the Transaction.

Regulation M-A Item 1004

(a) Material Terms. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“The Special Meeting”

“Special Factors”

“Terms of the Merger Agreement”

Appendix A – Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors”

“Summary of Amendment to Original Merger Agreement”

Appendix A – First Amendment to Agreement and Plan of Merger, dated as of September 9, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

(c) Different Terms. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Certain Effects of the Merger”

“Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

Appendix A – Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Certain Effects of the Merger”

“Updates to Special Factors – Purposes, Reasons and Plan for ShopKo after the Merger”

“Updates to Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Summary of Amendment to Original Merger Agreement – Consideration to be Received Pursuant to the Merger; Treatment of Stock Options”

(d) Appraisal Rights. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – No Dissenters’ Rights”

(e) Provisions for Unaffiliated Security Holders. The Filing Persons have made no provisions in connection with the Merger to grant unaffiliated shareholders access to the respective corporate files or any of the Filing Persons or to obtain counsel or appraisal services at the expense of the Filing Persons.

(f) Eligibility for listing or trading. Not applicable.

Item 5. Past Contacts, Transactions, Negotiations and Agreements.

4

(a) Transactions. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Special Factors – Background of the Merger”

“Past Contacts, Transactions, Negotiations and Agreements”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Updates to Special Factors – Background of the Merger”

“Past Contacts, Transactions, Negotiations and Agreements”

(b) Significant Corporate Events. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

“Special Factors – Financing”

“Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Special Factors – Amendment to ShopKo’s Rights Agreement”

“Terms of the Merger Agreement”

“Past Contacts, Transactions, Negotiations and Agreements”

Appendix A – Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Financing”

“Updates to Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Summary of Amendment to Original Merger Agreement”

“Past Contacts, Transactions, Negotiations and Agreements”

Appendix A – First Amendment to Agreement and Plan of Merger, dated as of September 9, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

(c) Negotiations or Contacts. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Special Factors – Background of the Merger”

“Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

(e) Agreements Involving the Subject Company’s Securities. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

“Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Special Factors – Amendment to ShopKo’s Rights Agreement”

“Terms of the Merger Agreement”

“Security Ownership of Certain Beneficial Owners and Management”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Summary of Amendment to Original Merger Agreement”

“Security Ownership of Certain Beneficial Owners and Management”

Item 6. Purposes of the Transaction and Plans or Proposals.

Regulation M-A Item 1006

(b) Use of Securities Acquired. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

5

“Summary Term Sheet”

“Special Factors – Background of the Merger”

“Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Special Factors – Certain Effects of the Merger”

“Special Factors – Financing”

“Special Factors – Debt Tender Offer”

“Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Special Factors – Amendment to ShopKo’s Rights Agreement”

“Terms of the Merger Agreement”

Appendix A – Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors — Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Updates to Special Factors – Certain Effects of the Merger”

“Updates to Special Factors – Financing”

“Updates to Special Factors – Debt Tender Offer”

“Updates to Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Summary of Amendment to Original Merger Agreement”

“Markets and Market Price”

Appendix A – First Amendment to Agreement and Plan of Merger, dated as of September 9, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

Item 7. Purposes, Alternatives, Reasons and Effects.

Regulation M-A Item 1013

(a) Purposes. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

“Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Special Factors – Certain Effects of the Merger”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Updates to Special Factors – Certain Effects of the Merger”

(b) Alternatives. The information set forth in the Definitive Proxy Statement under the caption “Special Factors — Background of the Merger” is incorporated herein by reference.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

(c) Reasons. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

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“Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Special Factors – Certain Effects of the Merger”

“Special Factors – Considerations Relating to the Proposed Merger”

“Special Factors – Financing”

“Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Special Factors – Estimated Fees and Expenses of the Merger”

“Special Factors – Material U.S. Federal Income Tax Consequences ”

“Special Factors – No Dissenters’ Rights”

“Terms of the Merger Agreement”

Appendix A – Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Updates to Special Factors – Certain Effects of the Merger”

“Updates to Special Factors – Considerations Relating to the Proposed Merger”

“Updates to Special Factors – Financing”

“Updates to Special Factors – Debt Tender Offer”

“Updates to Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Updates to Special Factors – Estimated Fees and Expenses of the Merger”

“Summary of Amendment to Original Merger Agreement”

Appendix A – First Amendment to Agreement and Plan of Merger, dated as of September 9, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

Item 8. Fairness of the Transaction.

Regulation M-A Item 1014

(a) Fairness. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

“Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Special Factors — Financial Projections”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated”

“Updates to Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Updates to Special Factors – Position of the GHJM Investors as to the Fairness of the Merger”

“Updates to Special Factors – Position of Mr. Jack W. Eugster as to the Fairness of the Merger”

“Updates to Special Factors – Position of Badger Retail Holding and Badger Acquisition as to the Fairness of the Merger”

“Updates to Special Factors – Financial Projections”

Appendix B – Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated, dated September 9, 2005

(b) Factors Considered in Determining Fairness. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

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“Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Special Factors — Financial Projections”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated”

“Updates to Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Updates to Special Factors – Position of the GHJM Investors as to the Fairness of the Merger”

“Updates to Special Factors – Position of Mr. Jack W. Eugster as to the Fairness of the Merger”

“Updates to Special Factors – Position of Badger Retail Holding and Badger Acquisition as to the Fairness of the Merger”

“Updates to Special Factors – Financial Projections”

Appendix B – Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated, dated September 9, 2005

(c) Approval of Security Holders. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“The Special Meeting – Record Date and Voting Information”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

(d) Unaffiliated Representative. The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated”
 
Appendix B – Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated, dated September 9, 2005

(e) Approval of Directors. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

(f) Other Offers. None.

Item 9. Reports, Opinions, Appraisals and Certain Negotiations.

Regulation M-A Item 1015

(a) Report, opinion or appraisal. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

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The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated”

Appendix B — Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated, dated September 9, 2005

(b) Preparer and summary of the report, opinion or appraisal. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated”

Appendix B — Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated, dated September 9, 2005

(c) Availability of Documents. The reports, opinions or appraisals referenced in this Item 9 will be made available for inspection and copying at the principal executive offices of the Company during its regular business hours by any interested holder of ShopKo common stock or any representative who has been designated in writing.

Item 10. Source and Amounts of Funds or Other Consideration.

Regulation M-A Item 1007

(a) Source of Funds. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

“Special Factors – Purposes, Reasons and Plans for ShopKo after the Merger”

“Special Factors – Financing”

“Special Factors – Estimated Fees and Expenses of the Merger”

“Terms of the Merger Agreement”

Appendix A – Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Purposes, Reasons and Plans after the Merger”

“Updates to Special Factors – Financing”

“Updates to Special Factors – Debt Tender Offer”

“Updates to Special Factors – Estimated Fees and Expenses of the Merger”

“Summary of Amendment to Original Merger Agreement”

“Appendix A — First Amendment to Agreement and Plan of Merger, dated as of September 9, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

(b) Conditions. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

9

“Special Factors – Financing”

“Terms of the Merger Agreement”

Appendix A – Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Updates to Special Factors – Financing”

“Summary of Amendment to Original Merger Agreement”

Appendix A – First Amendment to Agreement and Plan of Merger, dated as of September 9, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

(c) Expenses. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Financing”

“Special Factors – Estimated Fees and Expenses of the Merger”

“Terms of the Merger Agreement”

Appendix A – Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to Summary Term Sheet”

“Updates to Special Factors – Financing”

“Updates to Special Factors – Estimated Fees and Expenses of the Merger”

“Summary of Amendment to Original Merger Agreement”

Appendix A – First Amendment to Agreement and Plan of Merger, dated as of September 9, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

(d) Borrowed Funds. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Financing”

Appendix A – Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to Summary Term Sheet”

“Updates to Special Factors – Financing”

Appendix A – First Amendment to Agreement and Plan of Merger, dated as of September 9, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc.

Item 11. Interest in Securities of the Subject Company.

Regulation M-A Item 1008

(a) Securities Ownership. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Special Factors – Certain Effects of the Merger”

“Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Security Ownership of Certain Beneficial Owners and Management”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Updates to Special Factors – Certain Effects of the Merger”

“Updates to Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Security Ownership of Certain Beneficial Owners and Management”

(b) Securities Transactions. The information set forth in the Definitive Proxy Statement under the caption “Transactions in ShopKo Common Stock” and in the Proxy Supplement under the caption “Transactions in ShopKo Common Stock” is incorporated herein by reference.

Item 12. The Solicitation or Recommendation.

Regulation M-A Item 1012

(d) Intent to Tender or Vote in a Going-Private Transaction. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“The Special Meeting – Record Date and Voting Information”

“Special Factors – Background of the Merger”

10

“Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

(e) Recommendation of Others. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“Special Factors – Background of the Merger”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

Item 13. Financial Information.

Regulation M-A Item 1010

(a) Financial Information. The information set forth in the Definitive Proxy Statement under the caption “Where Shareholders Can Find More Information” is incorporated herein by reference.

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Selected Historical Financial Data”

“Where Shareholders Can Find More Information”

(b) Pro Forma Information. Not applicable.

Item 14. Person/Assets, Retained, Employed, Compensated or Used.

Regulation M-A Item 1009

(a) Solicitations or Recommendations. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“The Special Meeting – Expenses of Proxy Solicitation”

“Special Factors – Background of the Merger”

“Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Special Factors – Estimated Fees and Expenses of the Merger”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

“Updates to Special Factors – Estimated Fees and Expenses of the Merger”

(b) Employees and Corporate Assets. The information set forth in the Definitive Proxy Statement under the following captions is incorporated herein by reference:

“Summary Term Sheet”

“The Special Meeting – Expenses of Proxy Solicitation”

“Special Factors – Background of the Merger”

“Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

The information set forth in the Proxy Supplement under the following captions is incorporated herein by reference:

“Update to the Summary Term Sheet”

“Updates to Special Factors – Background of the Merger”

“Updates to Special Factors – Reasons for the Merger; Recommendations of the Special Committee and of Our Board of Directors; Fairness of the Merger”

“Updates to Special Factors – Interests of ShopKo Directors and Executive Officers in the Merger”

Item 15. Additional Information.

Regulation M-A Item 1011

(b) Other Material Information. The information set forth in the Proxy Supplement and the appendices thereto filed

11

contemporaneously herewith is incorporated in its entirety herein by reference.

Item 16. Exhibits.

Regulation M-A Item 1016

(a)(1)	Letter to Shareholders of ShopKo Stores, Inc., incorporated herein by reference to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on August 9, 2005
(a)(2)	Letter to Shareholders of ShopKo Stores, Inc., incorporated herein by reference to the Supplement to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on September 20, 2005
(a)(3)	Notice of Special Meeting of Shareholders of ShopKo Stores, Inc., incorporated herein by reference to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on August 9, 2005
(a)(4)	Notice of Reconvened Special Meeting of Shareholders of ShopKo Stores, Inc., incorporated herein by reference to the Supplement to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on September 20, 2005
(a)(5)	Definitive Proxy Statement of ShopKo Stores, Inc., incorporated herein by reference to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on August 9, 2005
(a)(6)	Supplement to the Definitive Proxy Statement of ShopKo Stores, Inc., incorporated herein by reference to the Supplement to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on September 20, 2005
(b)(1)	Real Estate Debt Commitment Letter, dated April 6, 2005, between Bank of America, N.A. and Goldner Hawn Johnson & Morrison Incorporated*
(b)(2)	Alternative Real Estate Loan Commitment Letter, dated June 10, 2005, between Bank of America, N.A. and Goldner Hawn Johnson & Morrison Incorporated*
(b)(3)	Senior Debt Commitment Letter, dated April 7, 2005, among Bank of America, N.A., Back Bay Capital Funding LLC, Banc of America Securities LLC and Goldner Hawn Johnson & Morrison Incorporated and Waiver Letter, dated June 10, 2005, by and among Bank of America, N.A., Back Bay Capital Funding LLC, Banc of America Securities LLC and Goldner Hawn Johnson & Morrison Incorporated*
(c)(1)	Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated dated April 7, 2005 incorporated herein by reference to Appendix B of the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on August 9, 2005
(c)(2)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Board of Directors of ShopKo Stores, Inc., dated February 9, 2004*
(c)(3)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated May 6, 2004*
(c)(4)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Board of Directors of ShopKo Stores, Inc., dated May 26, 2004*
(c)(5)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., August 25, 2004*
(c)(6)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated September 1, 2004*
(c)(7)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated October 27, 2004*
(c)(8)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated April 2, 2005*
(c)(9)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated April 7, 2005*
(c)(10)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated July 27, 2005**
(c)(11)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated August 23, 2005 relating to certain matters raised by the plaintiffs’ amended complaint filed on July 21, 2005 in connection with In re ShopKo Stores, Inc. Shareholder Litigation, Case No. 05-CV-677***
(c)(12)	Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated dated September 9, 2005 incorporated herein by reference to Appendix B of the Supplement to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on September 20, 2005
(c)(13)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated September 9, 2005
(c)(14)	Illustrative Analysis prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated September 9, 2005
(d)(1)	Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc., incorporated herein by reference to Appendix A of the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on August 9, 2005
(d)(2)	Equity Commitment Letter, dated April 7, 2005, among Marathon Fund Limited Partnership V, Jack W. Eugster, Badger Retail Holding, Inc. and Badger Acquisition Corp.*
(d)(3)	First Amendment to Agreement and Plan of Merger, dated as of September 9, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc., incorporated herein by reference to Appendix A of the Supplement to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on September 20, 2005
(f)	None
(g)	None

* Previously filed on June 13, 2005.

** Previously filed on August 3, 2005.

*** Previously filed on September 1, 2005.

12

     After due inquiry and to the best of my knowledge and belief, I certify that the information in this statement is true, complete and correct.

Dated: September 20, 2005

SHOPKO STORES, INC.
By:	/s/ STEVEN R. ANDREWS
Name:	Steven R. Andrews
Title:	Senior Vice President

BADGER RETAIL HOLDING, INC.
By:	/s/ MICHAEL T. SWEENEY
Name:	Michael T. Sweeney
Title:	Chief Executive Officer

BADGER ACQUISITION CORP.
By:	/s/ MICHAEL T. SWEENEY
Name:	Michael T. Sweeney
Title:	Chief Executive Officer

GOLDNER HAWN JOHNSON & MORRISON INCORPORATED
By:	/s/ MICHAEL S. ISRAEL
Name:	Michael S. Israel
Title:	Managing Director

MARATHON FUND LIMITED PARTNERSHIP V
By:	MILTIADES LIMITED PARTNERSHIP
Its:	General Partner
By:	MARATHON ULTIMATE GP, LLC
Its:	General Partner
By:	/s/ MICHAEL T. SWEENEY
Name:	Michael T. Sweeney
Title:	Manager

MILTIADES LIMITED PARTNERSHIP
By:	MARATHON ULTIMATE GP, LLC
Its:	General Partner
By:	/s/ MICHAEL T. SWEENEY
Name:	Michael T. Sweeney
Title:	Manager

MARATHON ULTIMATE GP, LLC
By:	/s/ MICHAEL T. SWEENEY
Name:	Michael T. Sweeney
Title:	Manager

JACK W. EUGSTER
 

/s/ JACK W. EUGSTER

13

EXHIBIT INDEX

(a)(1)	Letter to Shareholders of ShopKo Stores, Inc., incorporated herein by reference to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on August 9, 2005
(a)(2)	Letter to Shareholders of ShopKo Stores, Inc., incorporated herein by reference to the Supplement to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on September 20, 2005
(a)(3)	Notice of Special Meeting of Shareholders of ShopKo Stores, Inc., incorporated herein by reference to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on August 9, 2005
(a)(4)	Notice of Reconvened Special Meeting of Shareholders of ShopKo Stores, Inc., incorporated herein by reference to the Supplement to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on September 20, 2005
(a)(5)	Definitive Proxy Statement of ShopKo Stores, Inc., incorporated herein by reference to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on August 9, 2005
(a)(6)	Supplement to the Definitive Proxy Statement of ShopKo Stores, Inc., incorporated herein by reference to the Supplement to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on September 20, 2005
(b)(1)	Real Estate Debt Commitment Letter, dated April 6, 2005, between Bank of America, N.A. and Goldner Hawn Johnson & Morrison Incorporated*
(b)(2)	Alternative Real Estate Loan Commitment Letter, dated June 10, 2005, between Bank of America, N.A. and Goldner Hawn Johnson & Morrison Incorporated*
(b)(3)	Senior Debt Commitment Letter, dated April 7, 2005, among Bank of America, N.A., Back Bay Capital Funding LLC, Banc of America Securities LLC and Goldner Hawn Johnson & Morrison Incorporated and Waiver Letter, dated June 10, 2005, by and among Bank of America, N.A., Back Bay Capital Funding LLC, Banc of America Securities LLC and Goldner Hawn Johnson & Morrison Incorporated*
(c)(1)	Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated, dated April 7, 2005 incorporated herein by reference to Appendix B of the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on August 9, 2005
(c)(2)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Board of Directors of ShopKo Stores, Inc., dated February 9, 2004*
(c)(3)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated May 6, 2004*
(c)(4)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Board of Directors of ShopKo Stores, Inc., dated May 26, 2004*
(c)(5)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., August 25, 2004*
(c)(6)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated September 1, 2004*
(c)(7)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated October 27, 2004*
(c)(8)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated April 2, 2005*
(c)(9)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated April 7, 2005*
(c)(10)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated July 27, 2005**
(c)(11)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated August 23, 2005 relating to certain matters raised by the plaintiffs’ amended complaint filed on July 21, 2005 in connection with In re ShopKo Stores, Inc. Shareholder Litigation, Case No. 05-CV-677***
(c)(12)	Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated dated September 9, 2005 incorporated herein by reference to Appendix B of the Supplement to Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on September 20, 2005
(c)(13)	Discussion Materials prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated September 9, 2005
(c)(14)	Illustrative Analysis prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated for the Special Committee of the Board of Directors of ShopKo Stores, Inc., dated September 9, 2005
(d)(1)	Agreement and Plan of Merger, dated as of April 7, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc., incorporated herein by reference to Appendix A of the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on August 9, 2005
(d)(2)	Equity Commitment Letter, dated April 7, 2005, among Marathon Fund Limited Partnership V, Jack W. Eugster, Badger Retail Holding, Inc. and Badger Acquisition Corp.*
(d)(3)	First Amendment to Agreement and Plan of Merger, dated as of September 9, 2005, by and among Badger Retail Holding, Inc., Badger Acquisition Corp. and ShopKo Stores, Inc., incorporated herein by reference to Appendix A of the Supplement to the Definitive Proxy Statement on Schedule 14A filed by ShopKo Stores, Inc. with the Securities and Exchange Commission on September 20, 2005
(f)	None
(g)	None

* Previously filed on June 13, 2005.
** Previously filed on August 3, 2005.

*** Previously filed on September 1, 2005.

14

EX-99.(C)(13)

The Special Committee of the Board of Directors Confidential Discussion Materials Prepared for: September 9, 2005 CONFIDENTIAL Strictly Confidential Regarding Project Silver

Table of Contents Presentation to the Special Committee of the Board of Directors Regarding Project Silver 1. Overview of Proposed Transaction 2. Silver Update 3. Valuation Analysis Merrill Lynch prohibits (a) employees from, directly or indirectly, offering a favorable research rating or specific price target, or offering to change such rating or price target, as consideration or inducement for the receipt of business or for compensation, and (b) Research Analysts from being compensated for involvement in investment banking transactions except to the extent that such participation is intended to benefit investor clients.

Merrill Lynch prohibits (a) employees from, directly or indirectly, offering a favorable research rating or specific price target, or offering to change such rating or price target, as consideration or inducement for the receipt of business or for compensation, and (b) Research Analysts from being compensated for involvement in investment banking transactions except to the extent that such participation is intended to benefit investor clients.

Overview of Proposed Transaction

1 Selected Terms of GHJM Proposal

2 Transaction Summary (Dollars in Millions, Except per Share Data) ____________________ Note: Year represents calendar year. Fiscal year ends January following the calendar year. Financial projections based on Silver management estimates. Current price, 52-week high and 52-week low based on closing prices. (1) Accounted for using the treasury stock method, based on 30.2 million basic shares per 10-Q dated September 2, 2005, 2.0 million in-the-money options with an average exercise price of $15.46 and 0.1 million restricted shares as of March 25, 2005, per Silver management. (2) Net debt is calculated using an average annual revolver draw to account for operational seasonality. Unadjusted net debt is $241 million as of July 31, 2005. (3) Excludes transaction expenses. (4) Includes license revenues.

Note:	Year represents calendar year. Fiscal year ends January following the calendar year. Financial projections based on Silver management estimates. Current price, 52-week high and 52-week low based on closing prices.
(1)	Accounted for using the treasury stock method, based on 30.2 million basic shares per 10-Q dated September 2, 2005, 2.0 million in-the-money options with an average exercise price of $15.46 and 0.1 million restricted shares as of March 25, 2005, per Silver management.
(2)	Net debt is calculated using an average annual revolver draw to account for operational seasonality. Unadjusted net debt is $241 million as of July 31, 2005.
(3)	Excludes transaction expenses.
(4)	Includes license revenues.

Silver Update

3 __________________ Source: Company SEC filings and press releases. Historical Same Store Sales Trends SILVER PLATINUM 2001 2002 2003 2004 2005 2001 2002 2003 2004 2005 Silver continues to post negative sales trends despite positive industry results. Most recently, Silver reported negative 9.3% comp store sales for the month of August

Source: Company SEC filings and press releases.

4 (Dollars in Millions, Except per Share Data) Public Market Overview ____________________ Note: Year represents calendar year. Fiscal year ends January following the calendar year. Projections based on Silver Management estimates. (1) Diluted shares accounted for under the treasury stock method. Based on 30.2 million basic shares per 10-Q dated September 2, 2005, 2.0 million in- the-money options with an average exercise price of $15.46 and 0.1 million restricted shares as of March 25, 2005, per Silver management. Net debt is adjusted using an average annual revolver draw to account for operational seasonality. Unadjusted net debt is $241 million as of July 31, 2005. Includes license revenues.

Note:	Year represents calendar year. Fiscal year ends January following the calendar year. Projections based on Silver Management estimates.
(1)	Diluted shares accounted for under the treasury stock method. Based on 30.2 million basic shares per 10-Q dated September 2, 2005, 2.0 million in-the-money options with an average exercise price of $15.46 and 0.1 million restricted shares as of March 25, 2005, per Silver management.
(2)	Net debt is adjusted using an average annual revolver draw to account for operational seasonality. Unadjusted net debt is $241 million as of July 31, 2005.
(3)	Includes license revenues.

5 Last Five Years ____________________ Source: FactSet Database. Note: Current price as of September 8, 2005. Current price, 52-week high and 52-week low based on closing prices. Current $25.52 52-Wk High $26.02 52-Wk Low $16.07 Offer Price $25.00 Stock Price Performance

Source:	FactSet Database.
Note: Current price as of September 8, 2005. Current price, 52-week high and 52-week low based on closing prices.

6 Percent of Volume Which Traded Within Stock Price Range Percent of Volume Which Traded Below Stock Price ____________________ Source: FactSet closing price data as of September 8, 2005. Trading Volume Analysis Last Three Years Last Twelve Months Last Three Years Last Twelve Months More than 75% of Silver's shares have traded below $20.00 in the past three years

Source: FactSet closing price data as of September 8, 2005.

Valuation Analysis

(1) In the copy of these discussion materials distributed by Merrill Lynch to the special committee of the ShopKo board of directors on September 9, 2005, this figure was inadvertently listed as +2.6% rather than +2.8%.

7 Financial Projections Overview [85%] Key factors contributing to the strong skepticism about the projections include: Negative historical and current sales declines, significantly below industry trends ((9.3%) comps in August) Lack of confidence regarding Silver's ability to grow sales while closing and selling stores Sustainability of the business model given low projected CapEx coupled with underinvestment over last few years Fiercely competitive environment, particularly the increasing penetration of Wal-Mart super centers Currently no CEO and significant historical challenges recruiting strong managment The company has not had the opportunity to revise its 5-year plan since March 2005 The 2005 Base Case forecast has been modified to reflect current business trends, highlights including: Prior Forecast Current Forecast Sales +2.8% (1) (3.3%) Gross Profit $865mm $842mm Gross Margin 26.6% 27.5% EBITDA $191mm $187mm The current strength in gross margin cannot offset the declining sales trends which potentially have very negative long-term implications As noted in the proxy and numerous special committee meetings, the special committee has significant doubts whether these projections are achievable, given the current shortfall of 2005 results, which not only brings into question the 2006 projections but also the significant turnaround and increase in projected EBITDA in 2008 and 2009

8 Summary Silver Historical and Projected Financials ____________________ Source: Historical figures from Company filings; projections reflect Base Case provided by Silver management. Note: Dollars in millions, except per share data. (1) Store revenues excludes license fee revenue. [85%] As noted in the proxy and numerous special committee meetings, the special committee has significant doubts whether these projections are achievable, given the current shortfall of 2005 results, which not only brings into question the 2006 projections but also the significant turnaround and increase in projected EBITDA in 2008 and 2009

Source: Historical figures from Company filings; projections reflect Base Case provided by Silver management.
Note: Dollars in millions, except per share data.
(1)	Store revenues excludes license fee revenue.

9 Key Projection Assumptions ____________________ Source: Base Case assumptions provided by Silver management. 2004-2009 Revenue CAGR of 1.1% Silver revenue growth: 0.1% Platinum revenue growth: 3.3% No new store growth; assumes the closing of 10 Silver stores and 55 Platinum stores from 2006-2008 Marginal gross margin improvement as a result of merchant consolidation EBITDA improvement initiatives: IT Systems/Merchant consolidation: $10mm EBITDA contribution by 2009 Headcount reductions: $3mm EBITDA contribution by 2009 Identification/exit of underperforming stores: lost revenue of $189mm and EBITDA improvement of $5mm by 2009

Source: Base Case assumptions provided by Silver management.

10 Seasonal Debt Adjustment (Dollars in Millions) ____________________ Source: Silver SEC filings and Silver management. [110%] To account for the seasonality of Silver's operations and cash needs, net debt is calculated using an annual average revolver draw Adjusted net debt has decreased from $341mm to $291mm since our April analysis for three primary reasons: Unexpected sale of Colorado stores Reduction of working capital as a result of lower inventory from lower sales Lower CapEx budget as the board delayed purchases ahead of proposed transaction Lower sales expectations could lead to sustainably lower inventory position, yet the property sales and reduction in CapEx are a result of timing differences and are more one-time in nature

Source: Silver SEC filings and Silver management.

Note:	Net debt of $290 million is calculated using an average annual revolver draw to account for operational seasonality. Assumes 30.2 million basic shares per 10-Q dated September 2, 2005, 0.1 million restricted shares and “in-the-money” options as applicable as of March 25, 2005, per Silver management. All figures rounded to nearest $0.25 except for 3-Year Closing Stock Prices. Year represents calendar year. Fiscal year ends January following the calendar year. 30-day prior stock price of $18.09 is prior to original announcement in April 2005.
(1)	Present Value as of July 31, 2005.
(2)	Analysis assumes all financing other than that provided by the capital lease rollover, the asset-backed loan, the last out revolver and any non-equity like component of the real estate facility in the GHJM proposed structure is funded from equity. To calculate illustrative valuations, the non-equity component as described was fixed and the equity contribution was varied. All borrowing rates and fees assumed in proposed GHJM structure, as provided by GHJM on September 8, 2005, apply for illustrative purposes.

Sources: SEC filings, Wall Street research and company press releases.

13 Selected Retail Public Comparables ____________________ Note: Dollars in millions, except per share data. Closing prices from FactSet as of September 8, 2005. Source: SEC filings. It is important to note that the closest retail comparables are listed on the prior page. We do not believe there are any good public comparables to this business. We have selected the following list of retailers given their smaller size, regional geography and overlap in certain product categories

Note: Dollars in millions, except per share data. Closing prices from FactSet as of September 8, 2005.
Source:	SEC filings.

			Offer		Trans.		Transaction Value / LTM									Premium to Prior:
Date	Target	Acquiror	Value		Value		Sales			EBITDA			EBIT			1-Day			30-Day			90-Day
3/17/2005	Toys R Us	Bain Capital / KKR / Vornado	$	6,607.3	$	8,184.3		0.72	x		11.2	x		21.8	x		58.3	%(1)		58.4	%(1)		84.7	%(1)
1/9/2005	Hollywood Entertainment	Movie Gallery		852.0		1,015.0		1.40			4.4			6.9			NA			NA			NA
12/2/2004	Eye Care Centers of America	Moulin International / Golden Gate		NA		450.0		1.16			8.3			11.7			NA			NA			NA
11/17/2004	Sears, Roebuck and Co.	Kmart		10,806.4		13,751.4		0.40			7.4			14.1			7.7	%		19.8	%		41.8	%
10/14/2004	* Hollywood Entertainment	Leonard Green & Partners		669.2		874.6		0.50			3.7			5.1			NA			NA			NA
7/29/2004	Mervyn’s	Sun Capital & Cerberus		1,650.0		1,650.0		0.47			5.9			9.4			NA			NA			NA
7/26/2004	Duane Reade	Rex Corner Holdings		410.4		690.2		0.49			9.7			20.2			NA			NA			NA
6/21/2004	Galyans Trading Company	Dick’s Sporting Goods		308.9		365.2		0.51			10.7			50.2	(3)		1.5	%		23.9	%		7.1	%
4/23/2004	Loehmann’s Holdings	Crescent Capital Investments		178.1		169.1		0.46			6.9			11.5			4.7	%		14.1	%		26.6	%
3/29/2004	Hollywood Entertainment	Leonard Green & Partners		905.8		1,209.5		0.72			4.9			6.5			27.7	%		21.4	%		(1.0	%)
12/23/2003	Duane Reade	Rex Corner Holdings		416.1		703.5		0.52			9.4			16.5			11.7	%		25.5	%		(2.0	%)
10/17/2003	GNC	Apollo Management		735.0		750.0		0.55			5.8	(2)		NA			NA			NA			NA
7/29/2003	Elder Beerman	The Bon-Ton Stores		99.3		209.4		0.32			5.3			10.0			10.6	%		13.8	%		117.6	%(3)
12/2/2002	Vitamin Shoppe	Bear Stearns Merchant Banking		NA		320.0		1.22			7.1			NA			NA			NA			NA
7/12/2001	William Carter	Berkshire Partners		252.5		424.1		0.85			7.3			10.8			NA			NA			NA
5/17/2000	Petco Animal Supplies	Leonard Green / TPG		486.9		589.3		0.57			6.3			11.2			49.8	%		90.3	%(3)		NA
5/10/1999	Pamida Holdings Corp	ShopKo Stores Inc		104.4		272.4		0.40			6.5			8.2			27.8	%		NM			NM
5/4/1999	Galyans Trading Company	Freeman Spogli		83.3		157.2		0.48			6.6			12.1			NA			NA			NA
11/12/1998	Hills Stores Co	Ames Department Stores Inc	NA			299.4		0.17			5.0			22.0			9.5	%		(14.8	%)(3)		(55.8	%)(3)
4/15/1998	Advance Auto Parts	Freeman Spogli		NA		518.8		0.61			8.1			12.2			NA			NA			NA
10/9/1997	Big Five Sporting Goods	Leonard Green Partners		162.8		250.0		0.62			7.6			10.4			NA			NA			NA
			Maximum					1.40	x		11.2	x		22.0	x		49.8	%		25.5	%		41.8	%
			Mean					0.63	x		7.1	x		12.3	x		16.8	%		19.7	%		14.5	%
			Median					0.52	x		6.9	x		11.4	x		10.6	%		20.6	%		7.1	%
			Minimum					0.17	x		3.7	x		5.1	x		1.5	%		13.8	%		(2.0	%)
	Silver	GHJM	$	777	$	1,067		0.34	x		5.5	x		9.7	x		9.6	%(4)		38.2	%		33.5	%

Note: Dollars in millions.
Note: Leonard Green acquisition of Hollywood Entertainment not completed, as Movie Gallery subsequently agreed to acquire Hollywood Entertainment.
Sources: SEC filings, Wall Street research and company press releases.
* Initial transactions renegotiated; prior transactions not included in high, mean, median and minimum calculations for transaction multiples.
(1)	1-Day, 30-Day, and 90-Day premiums shown are relative to August 11, 2004, date of Toys “R” Us’s public announcement of intention to explore strategic alternatives. Price premiums excluded from maximum, median, mean and minimum calculations.
(2)	Reflects EBITA.
(3)	Excluded from maximum, median, mean and minimum calculations.
(4)	Represents premium to closing price on April 5, 2005.

15 DCF - EBITDA Multiple Method DCF - Exit in 2007 [115%] DCF - Exit in 2009 ____________________ Note: Dollars in millions, except per share data. Present values as of July 31, 2005. Net debt of $291 million is calculated using an average annual revolver draw to account for operational seasonality. Unadjusted net debt is $241 million as of July 31, 2005. Assumes 30.2 million basic shares per 10-Q dated September 2, 2005, 0.1 million restricted shares and "in-the-money" options as applicable as of March 25, 2005, per Silver management. Projections reflect Base Case provided by Silver Management.

Note: Dollars in millions, except per share data. Present values as of July 31, 2005. Net debt of $291 million is calculated using an average annual revolver draw to account for operational seasonality. Unadjusted net debt is $241 million as of July 31, 2005. Assumes 30.2 million basic shares per 10-Q dated September 2, 2005, 0.1 million restricted shares and “in-the-money” options as applicable as of March 25, 2005, per Silver management. Projections reflect Base Case provided by Silver Management.

Note:	This analysis should be viewed as a preliminary valuation review only and is not an appraisal. The properties have not been valued individually and have not been physically inspected. Broad valuation “rules of thumb”, in conjunction with a review of certain previous analyses completed by the Company, were utilized to arrive at a preliminary conclusion of a reasonable value range for the Silver portfolio.
(1)	Owned retail assets were valued assuming net market rent for each asset would fall between approximately 3.00% and 3.50% of 2004 gross sales provided by the Company. This imputed net market rent was then capitalized to a value estimate at a range of 8.00% to 8.50%. The high value estimate assumes a 3.50% market rent to sales ratio and an 8.00% cap rate. The low valuation assumes an 8.50% cap with a 3.00% rent to sales ratio. The resulting price per square foot for the owned assets was compared to the per square foot pricing of recent sales of other big box retail stores (such as Target, Wal-Mart, Costco, etc.) in the midwest and other comparable regions across the country. (Sales in more expensive areas, such as California, the northeast, etc. were not included.)
(2)	Silver Express store value estimate of $108/sf provided by management.
(3)	No value is assumed for the leased assets. While our analysis indicates that the Platinum contract rents may be slightly below market, any residual value attributable to the leasehold position appears to be more than offset by the costs of finding a new tenant and of tenant work that would be required.
(4)	Silver and Platinum ground leased assets valued at $50/sf for building (leasehold) only for base scenario. High and low values are plus and minus 20% of the base value respectively.
(5)	Owned “other assets” consists primarily of distribution warehouse properties, the Company’s corporate office and assorted vacant parcels. Value estimates were provided by the Company for these assets.
(6)	Assumes 30.2 million basic shares per 10-Q dated September 2, 2005, 0.1 restricted shares and “in-the-money” options at liquidation value per share as of March 25, 2005, per Silver management.
(7)	This analysis assumes a liquidation of the Silver portfolio, therefore the owned assets are assumed to be sold vacant. A negative adjustment to value is made to account for releasing of the assets and retrofitting of the space for a new tenant. The approximately $15/sf adjustment is based on the assumption of one year of rent loss due to vacancy for the owned assets (average market rent is estimated at approximately $5.67/sf) and approximately a $10/sf work allowance to retrofit the space.
(8)	Assumes assets divested over two-year period, assumes 11% discount and mid-year discounting. Tax basis of property (land, land bank, site improvements, building and leasehold interests) of $481 million at October 31, 2004 reduced annually by approximately $21 million in FY’05 and $21 million in FY’06, in line with historical depreciation rates.
(9)	Other net assets consists of other current assets ($60 million), current liabilities ($451 million), long-term debt ($235 million), other long-term obligations ($23 million) and deferred income taxes ($23 million).
(10)	Prescription files valued at a range of $0.24-$0.28 per $1 of Silver retail sales, $0.17-$0.21 per $1 of Platinum retail sales, based on Silver guidance. Proceeds in excess of net tax basis taxed at statutory tax rate of 35%.

17 Future Share Price Analysis FY EPS Estimates (1) Potential Future Share Price @ Forward P/E Multiple (14.3x) ____________________ Note: Year represents calendar year. Fiscal year ends January following the calendar year. (1) Based on Silver management estimates. (2) Based on the mid-point of an assumed discount rate range of 12.0% - 16.0%. Discounted to September 8, 2005. (3) Stock price as of September 8, 2005. Present Value of Share Price Based on 14.3x Forward P/E Multiple (2) Current Stock Price (3): $25.52 Prem./(Disc.) To Current Price: (12.1%) (40.1%) (48.4%) (27.8%) (26.1%) GHJM Offer Prem./(Disc.): 11.4% 63.5% 89.9% 35.6% 32.5%

Note: Year represents calendar year. Fiscal year ends January following the calendar year.
(1)	Based on Silver management estimates.
(2)	Based on the mid-point of an assumed discount rate range of 12.0% — 16.0%. Discounted to September 8, 2005.
(3)	Stock price as of September 8, 2005.

18 Share Repurchase Analysis Base Case ____________________ Note: Fiscal year ends in January of following year. Projections from Silver management. (1) Credit stats adjusted per Moody's methodology. [95%] Status Quo case assumes no annual share repurchases Share Repurchase case assumes $25 million annual share repurchase Initial share repurchase at market with future share prices based on constant P/E multiple to forward EPS (i.e., share price grows at EPS growth rate) Opportunity cost of share repurchase assumes LIBOR + 250 bps interest rate on debt Assumptions

Note: Fiscal year ends in January of following year. Projections from Silver management.
(1)	Credit stats adjusted per Moody’s methodology.

19 Future Share Price Analysis Including Share Repurchase FY EPS Estimates (1) Potential Future Share Price @ Forward P/E Multiple (14.3x) Present Value of Share Price Based on 14.3x Forward P/E Multiple (2) Prem./(Disc.) To Current Price: (10.4%) (39.9%) (47.4%) (21.6%) (17.6%) GHJM Offer Prem./(Disc.): 9.4% 63.1% 86.3% 25.0% 18.9% Current Stock Price (3): $25.52 ____________________ Note: Year represents calendar year. Fiscal year ends January following the calendar year. (1) Based on Silver management estimates. (2) Based on the mid-point of an assumed discount rate range of 12.0% - 16.0%. Discounted to September 8, 2005. (3) Stock price as of September 8, 2005.

Note: Year represents calendar year. Fiscal year ends January following the calendar year.
(1)	Based on Silver management estimates.
(2)	Based on the mid-point of an assumed discount rate range of 12.0% — 16.0%. Discounted to September 8, 2005.
(3)	Stock price as of September 8, 2005.

20 LBO Analysis - Offer Price of $25.00 Per Share ____________________ Note: Assumes transaction closes on July 31, 2005 for illustrative purposes. Year represents calendar year. Fiscal year ends January following the calendar year. Dollars in millions, except per share data. Fees and expenses include approximately $90 million of transaction fees and expenses, and additional prepayment fees and tender premiums. (1) Spread to LIBOR calculated to achieve initial stated rate of L+350 bps on entire $700 million real estate facility. Analysis assumes each of three available one-year extensions are exercised after the initial 2-year facility term. Analysis assumes purchase of interest rate protection agreement capping LIBOR at 4.10% for the term of the facility. (2) Debt balance as of July 31, 2005 from Company 10-Q. Estimated cash of $41.4 million not utilized as a source of funds. Sources of Funds Sources of Funds Uses of Funds Uses of Funds Returns Summary Returns Summary Traditional LBO Structure GHJM Proposed Structure (1) (1)

Note:	Assumes transaction closes on July 31, 2005 for illustrative purposes. Year represents calendar year. Fiscal year ends January following the calendar year. Dollars in millions, except per share data. Fees and expenses include approximately $90 million of transaction fees and expenses, and additional prepayment fees and tender premiums.
(1)	Spread to LIBOR calculated to achieve initial stated rate of L+350 bps on entire $700 million real estate facility. Analysis assumes each of three available one-year extensions are exercised after the initial 2-year facility term. Analysis assumes purchase of interest rate protection agreement capping LIBOR at 4.10% for the term of the facility.
(2)	Debt balance as of July 31, 2005 from Company 10-Q. Estimated cash of $41.4 million not utilized as a source of funds.

21 Disclaimer Merrill Lynch prohibits (a) employees from, directly or indirectly, offering a favorable research rating or specific price target, or offering to change such rating or price target, as consideration or inducement for the receipt of business or for compensation, and (b) Research Analysts from being compensated for involvement in investment banking transactions except to the extent that such participation is intended to benefit investor clients. This presentation is confidential, for your private use only, and may not be shared with others (other than your advisors) without Merrill Lynch's written permission, except that you (and each of your employees, representatives or other agents) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the proposal and all materials of any kind (including opinions or other tax analyses) that are provided to you relating to such tax treatment and tax structure. For purposes of the preceding sentence, tax refers to U.S. federal and state tax. This proposal is for discussion purposes only. Merrill Lynch is not an expert on, and does not render opinions regarding, legal, accounting, regulatory or tax matters. You should consult with your advisors concerning these matters before undertaking the proposed transaction.

EX-99.(C)(14)

1 Illustrative Analysis Overview of the Following Analysis [85%] At the request of the Special Committee, in light of their well-documented concerns regarding the attainability of management's Base Case projections, Merrill Lynch has performed a supplemental mechanical analysis These projections and the resulting analysis are for illustrative purposes only and were neither utilized nor relied upon by Merrill Lynch for the rendering of its opinion as to the fairness of the current $25.00 per share offer

(1)	Supplied by Silver management.
(2)	In the copy of these discussion materials distributed by Merrill Lynch to the special committee of the ShopKo board of directors on September 9, 2005, this figure was inadvertently listed as +2.6% rather than +2.8%.

2 Illustrative Analysis Concerns Highlighted by the Special Committee [85%] Key factors contributing to the strong skepticism about the projections include: Negative historical and current sales declines, significantly below industry trends ((9.3%) comps in August) Lack of confidence regarding Silver's ability to grow sales while closing and selling stores Sustainability of the business model given low projected CapEx coupled with underinvestment over last few years Fiercely competitive environment, particularly the increasing penetration of Wal-Mart super centers Currently no CEO and significant historical challenges recruiting strong management The company has not had the opportunity to revise its 5-year plan since March 2005 The 5-year plan from March 2005 was created due to a Board directive to demonstrate "what would need to happen in order to generate certain ROE targets," as opposed to a more fundamental approach to forecasting The Base Case forecast for 2005 only has been modified to reflect current business trends, highlights including: March Forecast(1) Current Forecast(1) Sales +2.8%(2) (3.3%) Gross Profit $865mm $842mm Gross Margin 26.6% 27.5% EBITDA $191mm $187mm The current strength in gross margin cannot offset the declining sales trends which potentially have very negative long-term implications As noted in the proxy and numerous Special Committee meetings, the special committee has significant doubts whether the March 2005 projections are achievable, given the current shortfall of 2005 results, which not only brings into question the 2006 projections but also the significant turnaround and increase in projected EBITDA in 2008 and 2009 ____________________

Source: Base Case projections provided by Silver management, adjusted as directed by the Special Committee.

(1) Excludes license fee revenues.

3 Illustrative Analysis Summary Historical and Illustrative Adjusted Projected Financials [85%] Illustrative financials are based on Base Case from management with the following adjustments: 5% reduction in 2005E EBITDA and 10% reduction in annual EBITDA for the remainder of the forecast period Additional capital expenditures in the amount of $25.6mm distributed evenly over 2006 and 2007 to compensate for the capital expenditure reductions in 2005

Note:	Net debt of $290 million is calculated using an average annual revolver draw to account for operational seasonality. Assumes 30.2 million basic shares per 10-Q dated September 2, 2005, 0.1 million restricted shares and “in-the-money” options as applicable as of March 25, 2005, per Silver management. All figures rounded to nearest $0.25 except for 3-Year Closing Stock Prices. Year represents calendar year. Fiscal year ends January following the calendar year. 30-day prior stock price of $18.09 is prior to original announcement in April 2005.
(1)	Present Value as of July 31, 2005.
(2)	Analysis assumes all financing other than that provided by the capital lease rollover, the asset-backed loan, the last out revolver and the non-equity like component of the real estate facility in the GHJM proposed structure is funded from equity. To calculate illustrative valuations, the non-equity component as described was fixed and the equity contribution was varied. All borrowing rates and fees assumed in proposed GHJM structure, as provided by GHJM on September 8, 2005, apply for illustrative purposes.

4 Illustrative Analysis Illustrative Valuations for Selected Alternatives Offer Price: $25.00 Multiples Analysis 5.5x - 6.5x 2005E EBITDA of $177.8 mm Status Quo 14.3x Forward EPS 14% Discount Rate Premium Analysis 15% - 25% Premium to 30-Day Prior Stock Price of $18.09 3-Year Closing Stock Prices Acquisition Comparables Share Repurchase 14.3x Forward EPS 14% Discount Rate Discounted Cash Flow Analysis (1) Liquidation Analysis Present Value of Projected Share Price Multiples Analysis 5.0x - 6.0x 2005E EBITDA of $177.8 mm Public Compara- bles 10% - 12% WACC 5.0x - 6.0x 2007E EBITDA of $150.0 mm 10% - 12% WACC 5.0x - 6.0x 2009E EBITDA of $173.8 mm Traditional LBO (2) 25% Targeted Return 4.5x - 5.5x 2009E EBITDA of $173.8 mm Valuation Summary - Illustrative Purposes Only