[SEARS HOLDINGS LETTERHEAD]

Annual base salary at a rate of $650,000.

Your annual incentive opportunity will remain at 75% of your base salary under Sears Holdings Annual Incentive Plan (“AIP”). Any incentive payable under the 2011 AIP will be prorated based on the amount of time spent at each salary level through January 28, 2012, the last day of Sears Holdings 2011 fiscal year. Your 2011 AIP also will continue to be measured 50% against the financial performance of Online BOP and 50% Online Total Gross Margin. Any annual incentive payable with respect to a fiscal year will be paid by April 15^th of the following fiscal year, provided that you are actively employed at the payment date.

You will be required to sign a new Executive Severance Agreement (“Agreement”).  If your employment with SHC is terminated by SHC (other than for Cause, death or Disability) or by you for Good Reason (as such capitalized terms are defined in the Agreement), you will receive twelve (12) months of salary continuation, equal to your base salary at the time of termination, subject to mitigation. Under the Agreement, you will agree, among other things, not to disclose confidential information and for twelve (12) months following employment not to solicit employees.  You also agree not to aid, assist or render services for any “Sears Competitor” or “Sears Vendor” (as such terms are defined in the Agreement) for twelve (12) months following termination of employment. The non-disclosure, non-solicitation, non-compete and non-affiliation provisions apply regardless of whether you are eligible for severance benefits under this Agreement. Please note that upon execution, this Agreement will supersede all previous severance agreements between you and SHC. The enclosed copy of this

This offer is also contingent upon satisfactory completion of a background reference check based on Company policy.