Amendment No. 2 to Amended and Restated Merchandising Agreement dated as of July 10, 2017 among (1) the registrant, Sears Authorized Hometown Stores, LLC, and Sears Outlet Stores, L.L.C. and (2) Sears Holdings Corporation, Sears, Roebuck and Co., and Kmart Corporation

This Amendment No. 2 (“Amendment”), dated as of July 10, 2017, is entered into by and between (1) Sears, Roebuck and Co., a New York corporation (“SRC”), Kmart Corporation, a Michigan corporation (“Kmart” and, together with SRC, “Seller”) and Sears Holdings Corporation, a Delaware corporation (“SHC”) and (2) Sears Hometown and Outlet Stores, Inc., a Delaware corporation (“SHOS”), Sears Authorized Hometown Stores, LLC, a Delaware limited liability company (“SAHS”) and Sears Outlet Stores, L.L.C., a Delaware limited liability company (“Outlet Co.” and, together with SHOS and SAHS, “Buyer”), to further amend the Amended and Restated Merchandising Agreement, retroactive to May 1, 2016, as amended by the Amendment to Amended and Restated Merchandising Agreement, dated as of March 8, 2017, by and between Seller, SHC and Buyer (the “Agreement”). SHC, Seller and SHO are hereinafter referred to individually as a “Party” and collectively as the “Parties.” Defined terms used herein but not otherwise defined shall have the meanings ascribed to them in the Agreement.

NOW THEREFORE, in consideration of the above premises and the mutual covenants herein, the Parties agree as follows: