Exhibit 10.1

FIRST AMENDMENT TO THIRD AMENDED AND RESTATED

LOAN AGREEMENT

This First Amendment (this “Amendment”), dated as of September 12, 2018, is
entered into by and among (i) JPP, LLC, a Delaware limited liability company, as
agent (in its capacity as administrative agent for the Lenders, together with
its permitted successors and assigns in accordance with Section 7.1 of the Loan
Agreement, the “Agent”), (ii) JPP, LLC, JPP II, LLC and Cascade Investment,
L.L.C. (“Cascade”), collectively, as lenders (together with their respective
permitted successors and assigns, individually or collectively, as the context
may require, “Lender”), (iii) SEARS, ROEBUCK AND CO. (“Sears”), KMART STORES OF
ILLINOIS LLC, KMART OF WASHINGTON LLC, KMART CORPORATION (“KMART”), SHC DESERT
SPRINGS, LLC, INNOVEL SOLUTIONS, INC., SEARS HOLDINGS MANAGEMENT CORPORATION,
MAXSERV, INC., TROY COOLIDGE NO. 13, LLC, SEARS DEVELOPMENT CO. and BIG BEAVER
OF FLORIDA DEVELOPMENT, LLC, collectively as borrowers (individually or
collectively, as the context may require, jointly and severally, together with
their respective permitted successors and assigns, “Borrower”), and (iv) SEARS
HOLDINGS CORPORATION, as guarantor (for purposes of Section 7.30(b) of the Loan
Agreement), and amends that certain Third Amended and Restated Loan Agreement,
dated as of June 4, 2018 (as amended hereby, the “Loan Agreement”; all
capitalized terms used but not defined herein shall have the respective meanings
ascribed to such terms in the Loan Agreement).

WHEREAS, on June 4, 2018, Lender and Borrower entered into the Third Amended and
Restated Loan Agreement; and

WHEREAS, Lender and Borrower desire to amend the Third Amended and Restated Loan
Agreement in connection with Lender’s making the Amendment Date Advance (as
hereinafter defined).

NOW THEREFORE, in consideration of the mutual premises contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby represent, warrant, covenant and
agree as follows:

Section 1. Amendment of Loan Documents. Lender and Borrower hereby agree to
amend the terms of the Loan Agreement as follows:

(a) The following definitions are hereby added to the list of definitions:

“ABL Facility” means the Third Amended and Restated Credit Agreement, dated as
of July 21, 2015, as amended from time to time, with Bank of America, N.A. as
Administrative Agent and Co-Collateral Agent, Wells Fargo Bank, National
Association, as Co-Collateral Agent, under which the borrowers and guarantors
thereunder from time to time have certain obligations, as more fully set forth
therein.

“Amendment Closing Date” means September 12, 2018.”

 

Amendment to Loan Documents

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“Amendment Date Advance” has the meaning set forth in Section 1.1(a).”

“Amendment Date Advance Borrower” means Sears, KMART Stores of Illinois LLC,
KMART of Washington LLC, KMART and Sears Holdings Management Corporation
(individually or collectively, as the context may require, jointly and
severally, together with their respective permitted successors and assign).

“Ground Lease” means, with respect to each Property referenced as a “Ground
Lease Property” on the Property List, any “Pledged Lease” described in the
applicable Mortgage (or any equivalent or similar term by which a ground lease
may be described therein), as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time in accordance herewith.

“Ground Leased Parcel” means, with respect to each relevant Property, any
portion of such Property that is ground leased to Borrower, as lessee, under a
Ground Lease.

“Note A-1” that certain Promissory Note A-1, dated as of the date hereof, in the
maximum principal amount of $70,611,726.86 by Borrower in favor of Cascade,
which together with Note A-2 amends and restates that certain Second Amended and
Restated Promissory Note A, as the same may be replaced by one or more Notes
pursuant to the terms hereof and as otherwise assigned (in whole or in part),
amended, restated, replaced, supplemented or otherwise modified in accordance
herewith.

“Note A-2” that certain Promissory Note A-2, dated as of the date hereof, in the
maximum principal amount of $37,500,000 by Amendment Date Advance Borrower in
favor of Cascade, which together with Note A-1 amends and restates that certain
Second Amended and Restated Promissory Note A, as the same may be replaced by
one or more Notes pursuant to the terms hereof and as otherwise assigned (in
whole or in part), amended, restated, replaced, supplemented or otherwise
modified in accordance herewith.

“Note B-1” that certain Promissory Note B-1, dated as of the date hereof, in the
maximum principal amount of $685,816,996.74 by Borrower in favor of the Initial
Lender, which together with Note B-2 amends and restates that certain Second
Amended and Restated Promissory Note B, as the same may be replaced by one or
more Notes pursuant to the terms hereof and as otherwise assigned (in whole or
in part), amended, restated, replaced, supplemented or otherwise modified in
accordance herewith.

“Note B-2” that certain Promissory Note B-2, dated as of the date hereof, in the
maximum principal amount of $37,500,000 by Amendment Date Advance Borrower in
favor of the Initial Lender, which together with Note B-1 amends and restates
that certain Second Amended and Restated Promissory Note B, as the same may be
replaced by one or more Notes pursuant to the terms hereof and as otherwise
assigned (in whole or in part), amended, restated, replaced, supplemented or
otherwise modified in accordance herewith.

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“Potential Release Properties” means each of the Properties on the Property List
designated as “Potential Release Properties”.

“Second Additional Properties” means those certain Properties noted as “Second
Additional Properties” on the Property List and for which Borrower is delivering
Mortgages to Lender on the First Amendment Closing Date.

(b) The definition of “ABL Collateral” is hereby deleted in its entirety and
replaced with the following:

““ABL Collateral” means inventory and accounts receivable and other personal
property that is collateral for the obligations under the ABL Facility. For the
avoidance of doubt, the ABL Collateral does not include any of the Properties.”

(c) The definition of “Delayed Origination Fee” and “Second Delayed Origination
Fee” are hereby deleted in their entirety and replaced with the following:

““Delayed Origination Fee” means, as of the date of determination, an amount
equal to 1.00% times the aggregate Principal Indebtedness outstanding under Note
A-1 and Note A-2.”

““Second Delayed Origination Fee” means, as of the date of determination, an
amount equal to 2.00% times the aggregate Principal Indebtedness outstanding
under Note A-1 and Note A-2.”

d) The definition of “Note A” and “Note B” are hereby deleted in their entirety
and replaced with the following:

““Note A” means, individually or collectively as the context may require, the
Note A-1 and the Note A-2.”

““Note B” means, individually or collectively as the context may require, the
Note B-1 and the Note B-2.”

(e) The definitions of “Material Agreements” and “Officer’s Certificate” are
hereby deleted in its entirety and replaced with the following:

““Material Agreements” means each Ground Lease and each other contract and
agreement in force and effect relating to the Property a default under which or
the termination or cancellation of which could reasonably be expected to result
in a Material Adverse Effect, other than (i) Leases (but including REA’s), (ii)
Multi-Site Agreements and (iii) any agreement (other than REA’s) set forth on
Schedule B of the Title Insurance Policy.”

““Officer’s Certificate” means the officer’s certificate of Borrower, dated as
of the Amendment Closing Date, delivered to Lender and certifying, among other
things, (i) certain organizational documents of Borrower, (ii) the Property
List, (iii) the Allocated Loan Amounts, (iv) the Policies, (v) the Rent Roll,
(vi) the Exception Report and (vii) the organizational chart referred to in
Section 3.1(b).

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(f) Section 1.1(a) of the Loan Agreement is hereby deleted in its entirety and
replaced with the following:

“As of immediately prior to the New Closing Date, the outstanding Principal
Indebtedness was $592,553,155.54. On the New Closing Date, subject to the terms
and conditions of this Agreement, Lender made an additional advance to Borrower
in the amount of $186,527,682.14 (the “Additional Advance”) such that the
Principal Indebtedness immediately following the Additional Advance was
$779,080,837.68. On the New Closing Date, Borrower (i) paid to Cascade an
extension and origination fee in an amount equal to $466,319.21, (ii) paid to
the Initial Lenders an extension and origination fee in an amount equal to
$1,146,198.33, and (iii) reimbursed each Lender for any reasonable and
documented out-of-pocket costs and expenses incurred by such Lender in
connection with the amendment and restatement of this Agreement and any other
matters relating to the Loan. As of immediately prior to the Amendment Closing
Date, the total outstanding Principal Indebtedness was $756,428,723.60,
consisting of $70,611,726.86 under Note A and $685,816,996.74 under Note B. On
the Amendment Closing Date, subject to the terms and conditions of this
Agreement, Lender shall make an additional advance to Amendment Date Advance
Borrower in the aggregate amount of $75,000,000 (the “Amendment Date Advance”)
such that the total Principal Indebtedness immediately following the Amendment
Date Advance will be $831,428,723.60, consisting of: $70,611,726.86 under Note
A-1; $37,500,000 under Note A-2; $685,816,996.74 under Note B-1; $37,500,000
under Note B-2. Amendment Date Advance Borrower covenants and agrees that the
proceeds of the Amendment Date Advance shall be used to repay certain
obligations of Amendment Date Advance Borrower under the ABL Facility. In
connection with the Amendment Date Advance, Sears and KMART delivered to Lender
on the Amendment Closing Date, as collateral for the Loan, executed Mortgages on
the Second Additional Properties. On the Amendment Closing Date, Amendment Date
Advance Borrower shall (A) pay to Cascade an origination fee in respect of its
portion of the Amendment Date Advance in an amount equal to $187,500, (B) pay to
the Initial Lenders in respect of their respective portions of the Amendment
Date Advance an origination fee in an amount equal to $187,500, and
(C) reimburse each Lender for any reasonable and documented out-of-pocket costs
and expenses incurred by such Lender in connection with the amendment of this
Agreement and any other matters relating to the Loan. The Loan (which, for the
avoidance doubt, includes the Additional Advance and the Amendment Date Advance)
shall be represented by the Notes and shall bear interest as described in this
Agreement at a per annum rate equal to the Interest Rate. Interest payable
hereunder shall be computed on the basis of a 360-day year and the actual number
of days elapsed in the related Interest Accrual Period. In addition, (I) to the
extent any portion of the Principal Indebtedness outstanding under Note A-1
and/or Note A-2 remains outstanding on March 12, 2019, Borrower shall pay to
holder of such Note the Delayed Origination Fee on or before March 15, 2019
(with only Amendment Date Advance Borrower bearing the portion thereof
attributable to Note A-2) and (II) to the extent any portion of the Principal
Indebtedness outstanding under Note A-1 and/or Note A-2 remains outstanding on
September 12, 2019, Borrower shall pay to holder of such Note the Second Delayed
Origination Fee on or before September 16, 2019 (with only Amendment Date
Advance Borrower bearing the portion thereof attributable to Note A-2).”

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(g) Section 1.2(b) is hereby deleted in its entirety and replaced with the
following:

“At any time prior to October 15, 2018, Borrower shall have the right to request
an additional advance under the Loan in an amount not to exceed $50,000,000,
provided that (i) the making of any such advance and the amount thereof shall be
subject to Lender’s sole discretion (i.e., Lender in its sole discretion may
elect to make no such advance, an advance of less than the amount requested or
an advance of the entirety of the amount requested) and (ii) in the event Lender
shall agree to make any such advance in its sole discretion, such advance shall
be conditioned upon, among other things, (x) the payment of an origination fee
with respect to such advance in an amount equal to 0.5% of the amount so
advanced and (y) the execution of further amendments to the Loan Agreement, the
Notes and such other Loan Documents as Lender shall reasonably deem necessary to
reflect the making of such advance, and, if requested by Lender, the delivery to
Lender of legal opinions with respect to such amendments substantially in the
form of the legal opinions delivered to Lender as of the date hereof. If no such
advance is made pursuant to this Section 1.2(b) because Borrower shall not have
requested any such advance prior to October 15, 2018, or Borrower shall have
requested such an advance but Lender shall have determined in its sole
discretion not to fund any portion of such requested advance, or if prior to
October 15, 2018 Borrower terminates its right to request an additional advance
pursuant to this Section 1.2(b) by written notice to Lender, then, so long as no
Event of Default is continuing, Lender shall reasonably promptly release from
the lien of the Mortgages each of the Potential Release Properties. If Lender
shall determine in its sole discretion to make an additional advance of less
than $50,000,000 because Borrower shall have requested such lesser amount or
Borrower requested a greater amount but Lender determined in its sole discretion
to advance a lesser amount, then, in either such case, so long as no Event of
Default is continuing, Lender shall reasonably promptly release from the lien of
the Mortgages such of the Potential Release Properties (as reasonably determined
by Lender in good faith) that would result in a loan-to-value ratio of
approximately 61.6% (but in no event greater than 65%), based on the Amendment
Date Advance plus any such advance made pursuant to this Section 1.2(b) relative
to the appraised values of the Second Advance Properties set forth in the
appraisals for the Second Advance Properties provided to Lender as of the
Amendment Closing Date.

(h) The following new Section 1.2(e) shall be added immediately following the
end of Section 1.2(d):

“The Loan may be prepaid, in whole or in part, at any time and from time to
time, to the extent not prohibited by any agreement governing other Debt of the
Guarantor and its subsidiaries. Subject to the Co-Lender Agreement, all
prepayments or repayments of the Loan permitted or required hereunder shall be
applied toward the reduction of the Principal Indebtedness among the Notes
and/or the Note Components in the following

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order of priority: (i) first to the holder of Note A (with such payments to be
allocated among Note A-1 and Note A-2 as determined by the holders thereof),
until the Principal Indebtedness outstanding under Note A-1 and Note A-2 is
equal to zero; and (ii) any remaining amounts to the holder of Note B (with such
payments to be allocated among Note B-1 and Note B-2 as determined by the
holders thereof); provided, that the holder of Note A shall have the right to
waive prepayment or repayment of any such amount (other than in connection with
a repayment of the Loan in full at maturity or any other prepayment in full or
repayment in full of the Loan), in which case (x) such prepayment or repayment
shall be applied to Note B and (y) such amount shall reduce the Principal
Indebtedness deemed outstanding under Note A solely for the purpose of
calculating the Delayed Origination Fee and the Second Delayed Origination Fee.
The Loan must be repaid in connection with each release of a Property pursuant
to Section 1.6(a), in the amount required thereby. The entire outstanding
principal balance of the Loan together with interest through the Maturity Date
and all other amounts then due under the Loan Documents, shall be due and
payable by Borrower to Lender on the Maturity Date. Interest will cease to
accrue on any portion of the Principal Indebtedness that has been repaid to
Lender.”

(h) The following new Section 2.2 shall be added immediately following the end
of Section 2.1:

“Section 2.2 Post-Amendment Closing Deliveries.

(a) Borrower shall deliver to Lender, at Borrower’s sole cost and expense,
within 15 Business Days following Lender’s written request (which written
request may be via email) an amendment to each of the Mortgages reflecting the
increased amount of the Principal Indebtedness. Each such amendment shall be in
form and substance reasonably acceptable to the applicable local counsel.

(b) If Lender shall receive comments from the title company that issued the
Title Insurance Policies, regarding the enforceability, validity, effectiveness
or insurability of each Mortgage for the Original Properties or the Additional
Properties in light of the Amendment Date Advance, Borrower shall cooperate with
Lender in the preparation, execution and recording of amendments to such
Mortgages (and/or other instruments reasonably required) necessitated by such
comments and the delivery of an appropriate mortgage modification endorsement to
the applicable Title Insurance Policy, all at Borrower’s sole cost and expense.

(c) As a material inducement to Lender making the Loan, Borrower agrees that it
(i) shall deliver Surveys and Title Insurance Policies acceptable to Lender for
each of the Second Additional Properties, (ii) shall use commercially reasonable
efforts to deliver a legal opinion as to the enforceability of each Mortgage
securing a Second Additional Property under the laws of the state in which the
applicable individual Second Additional Property is located, and certain other
matters covered by local counsel opinions previously delivered to Lender in
connection with the Loan (it being understood that the formulation of such
opinions shall be subject to the policies of the counsel providing such opinions
and qualifications required by the various jurisdictions in which the Properties
are located) and (iii) shall deliver such endorsements to each Title Insurance
Policy covering the Original Properties and the Additional Properties as are

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acceptable to Lender to insure the continued priority of the related Mortgage
following the addition of the Second Additional Properties and include the
Second Additional Properties in the “tie-in” endorsement to each such Title
Insurance Policy to the extent available and permissible under the laws of the
state in which the applicable individual Original Property or Additional
Property, as applicable, is located, in each case, (x) with respect to the
Properties noted as “Priority Properties” on the Property List, on or before the
thirtieth (30th) day following the Amendment Closing Date (except for any tie-in
endorsement, which will be finalized promptly following the determination by
Lender of the Potential Release Properties that will remain subject to the lien
of the Mortgages in connection with the making of a Discretionary Advance (if
any) pursuant to Section 1.2(b)) and (y) with respect to all other Original
Properties, Additional Properties and Second Additional Properties, on or before
the ninetieth (90th) day following the Amendment Closing Date or, in each case,
such later date as to which Lender may grant its consent, not to be unreasonably
withheld, delayed or conditioned (so long as Borrower is diligently pursuing the
satisfaction of such items).

(d) If Lender shall receive comments to any Mortgage from local counsel in
connection with the delivery of the opinions delivered pursuant to
Section 2.2(b)(ii), or from the title company issuing the Title Insurance
Policies, in each case, regarding the enforceability, validity, effectiveness or
insurability of such Mortgage (in light of the Amendment Date Advance or
otherwise) or delivery of any Title Insurance Policy or endorsement required
pursuant to Section 2.2(b)(iii), Borrower shall cooperate with Lender in the
preparation, execution and recording of any amendments to such Mortgages
necessitated by such comments and the delivery of an appropriate mortgage
modification endorsement to the applicable Title Insurance Policy, all at
Borrower’s sole cost and expense.”

(i) The following new Section 3.34 shall be added immediately following the end
of Section 3.33:

“Section 3.34. Ground Leased Parcel. Subject to the Exception Report, each of
the following is true with respect to each Ground Lease:

(i) The Ground Lease has an original term (or an original term plus one or more
optional renewal terms) that extends not less than twenty (20) years beyond the
Maturity Date (including any unexercised option periods and automatic renewal
periods);

(ii) The Ground Lease does not prohibit Borrower’s ability to mortgage its
leasehold interest therein, and the Ground Lease is assignable to Lender, its
successors and assigns, without the consent of the ground lessor thereunder, and
in the event it is so assigned, it is further assignable by Lender and its
successors and assigns without the consent of the lessor;

(iii) Borrower has not received any written notice of default and have no
knowledge of any default under any Ground Lease that remains uncured and, to the
Borrower’s knowledge no condition exists that, but for the passage of time or
giving of notice, would result in a default by any party under the terms of the
Ground Lease, and the Ground Lease is in full force and effect as of the
Amendment Closing Date;

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(iv) The Ground Lease or a memorandum of the Ground Lease (with or without
amendments) has been duly recorded, except as set forth on the Exception Report.
To Borrower’s knowledge, there have not been amendments or modifications to the
terms of the Ground Lease since recordation of the Ground Lease (or a memorandum
thereof), with the exception of written instruments which have been recorded or
except as set forth on the Exception Report; and

(v) As of the date hereof, Borrower has not given and, to Borrower’s knowledge,
no Borrower or its affiliate has received any written notice of any material
default(s) under any easements, REA’s, rights-of-way, covenants, conditions,
statutory restrictions (including building, fire and safety, land use and
development, and zoning regulations and restrictions), or declarations affecting
the Ground Leased Parcels, in each case, that are continuing as of the date
hereof and that are not in the process of being contested by appropriate
proceedings conducted diligently and in good faith or being cured, and that in
any case would have a Material Adverse Effect.”

(j) The following new Section 5.12 shall be added immediately following the end
of Section 5.11:

“Section 5.12. Ground Lease.

(a) Except as may be expressly required pursuant to the Ground Lease in effect
as of the Amendment Closing Date, Borrower shall not amend, modify, surrender,
forfeit or consent to the termination of any Ground Lease without Lender’s prior
written consent, which consent, in the absence of an Event of Default, shall not
be unreasonably withheld, conditioned or delayed.

(b) Borrower shall, at their sole cost and expense, promptly and timely perform
and observe all the material terms, covenants and conditions required to be
performed and observed by Borrower as lessee under each Ground Lease (including,
but not limited to, the payment of all rent, additional rent, percentage rent
and other charges required to be paid under each Ground Lease).

(c) Borrower shall not, without Lender’s prior written consent, fail to exercise
any option or right to renew or extend the term of any Ground Lease according to
its terms during the term of this Agreement and shall give prompt written notice
to Lender and shall execute, acknowledge, deliver and record any document
reasonably requested by Lender to evidence the lien of the related Mortgage on
such extended or renewed lease term; provided, however, Borrower shall not be
required to exercise any particular such option or right to renew or extend to
the extent Borrower shall have received the prior written consent of Lender
(which consent, in the absence of an Event of Default, may not be unreasonably
withheld, delayed or conditioned) allowing Borrower to forego exercising such
option or right to renew or extend. If Borrower shall fail to exercise any such
option or right that is required as aforesaid, Lender may exercise the option or
right as Borrower’s agent and attorney-in-fact as provided above in Lender’s own
name or in the name of and on behalf of a nominee of Lender, as Lender may
determine in the exercise of its sole and absolute discretion, subject to the
terms and conditions of the Ground Lease.

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(d) Borrower shall not agree in writing to do any of the following: waive,
excuse, condone or in any way release or discharge any ground lessor under any
Ground Lease of or from such ground lessor’s obligations, covenants and/or
conditions under the related Ground Lease without the prior written consent of
Lender.

(e) Lender’s granting of consent to one amendment, change, agreement or
modification shall not be deemed to be a waiver of the right to require consent
to other, future or successive amendments, changes, agreements or modifications.
Any acquisition of ground lessor’s interest in any Ground Lease by Borrower or
any affiliate of Borrower shall be accomplished by Borrower in such a manner so
as to avoid a merger of the interests of lessor and lessee in such Ground Lease,
unless consent to such merger is granted by Lender, with any acquisition
resulting in such a merger without the consent of Lender being void ab initio.

(f) If Borrower shall be in default under any Ground Lease that could result in
the termination thereof and either (i) are not (or have not given notice that
they are or will be) diligently pursuing a cure of the same within the
applicable cure period or (ii) all applicable cure periods have lapsed, then,
subject to the terms of the applicable Ground Lease, Borrower shall grant Lender
the right (but not the obligation), to cause the default or defaults under such
Ground Lease to be remedied and otherwise exercise any and all rights of
Borrower under the Ground Lease, as may be necessary to prevent or cure any
default, and Lender shall have the right to enter all or any portion of the
related Property at such times and in such manner as Lender deems necessary, to
prevent or to cure any such default.

(g) The actions or payments of Lender to cure any default by Borrower under each
Ground Lease shall not remove or waive, as between Borrower and Lender, the
default that occurred under this Agreement by virtue of the default by Borrower
under any Ground Lease. All sums expended by Lender to cure any such default
shall be paid by Borrower to Lender, upon demand, with interest on such sum at
the Default Rate set forth in this Agreement from the date such sum is expended
to and including the date the reimbursement payment is made to Lender. All such
indebtedness shall be deemed to be secured by the related Mortgage.

(h) Borrower shall notify Lender promptly in writing of the occurrence of any
default that could result in the termination of a Ground Lease (upon any of
Borrower becoming aware of any such default) by the ground lessor under any
Ground Lease or following the receipt by Borrower of any written notice from the
ground lessor under any Ground Lease noting or claiming the occurrence of any
default by Borrower under any Ground Lease that could result in the termination
of such Ground Lease or the occurrence of any event that, with the passage of
time or service of notice, or both, would constitute a default by Borrower under
any Ground Lease. Borrower shall promptly deliver to Lender a copy of any such
written notice of default. Notwithstanding the generality of the foregoing,
Borrower shall use commercially reasonable efforts to cause the ground lessor
under each Ground Lease to give notice of any default thereunder to Lender
concurrent with the giving of notice thereof to Borrower.

(i) Within ten (10) business days after receipt of written demand by Lender,
Borrower shall use commercially reasonable efforts to obtain from the ground
lessor under each Ground Lease and promptly after receipt furnish to Lender the
estoppel certificate of the ground lessor stating the date through which rent
has been paid and whether or not there are any defaults thereunder and
specifying the nature of such claimed defaults, if any.

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(j) Subject to the terms and conditions of the Ground Lease, Borrower shall
reasonably promptly execute, acknowledge and deliver to Lender such instruments
as may be reasonably required to permit Lender to cure any default under any
Ground Lease (subject to the provisions of clause (f) above) or permit Lender to
take such other action reasonably required to enable Lender to cure or remedy
the matter in default (subject to clause (f) above) and preserve the security
interest of Lender under the Loan Documents with respect to each Ground Lease
Property. Borrower irrevocably appoints Lender as its true and lawful
attorney-in-fact to do, in its name or otherwise, after the occurrence of an
Event of Default, any and all acts and to execute any and all documents that are
reasonably necessary to preserve any rights of Borrower under or with respect to
each Ground Lease, including, without limitation, the right to effectuate any
extension or renewal of each Ground Lease (subject to clause (c) above), or to
preserve any rights of Borrower whatsoever in respect of any part of each Ground
Lease (and the above powers granted to Lender are coupled with an interest and
shall be irrevocable).

(k) Notwithstanding anything to the contrary contained in this Agreement with
respect to each Ground Lease:

(i) The lien of the related Mortgage attaches to all of Borrower’s rights and
remedies at any time arising under or pursuant to Subsection 365(h) of the
Bankruptcy Code, 11 U.S.C. Sections 101 et seq., including, without limitation,
all of Borrower’s rights, as debtor, to remain in possession of the related
Property.

(ii) Borrower shall not, without Lender’s written consent, elect to treat the
Ground Lease as terminated under Subsection 365(h)(l) of the Bankruptcy Code.
Any such election made without Lender’s prior written consent shall be void.

(iii) As security for the Obligations, Borrower unconditionally assigns,
transfers and sets over to Lender all of Borrower’s claims and rights to the
payment of damages arising from any rejection by the lessor under the Ground
Lease under the Bankruptcy Code. Lender and Borrower shall proceed jointly or in
the name of Borrower in respect of any claim, suit, action or proceeding
relating to the rejection of the Ground Lease, including, without limitation,
the right to file and prosecute any proofs of claim, complaints, motions,
applications, notices and other documents in any case in respect of lessor under
the Bankruptcy Code. This assignment constitutes a present, irrevocable and
unconditional assignment of the foregoing claims, rights and remedies, and shall
continue in effect until all of the Obligations shall have been satisfied and
discharged in full. Any amounts received by Lender or Borrower as damages
arising out of the rejection of the Ground Lease as aforesaid shall be applied
to all costs and expenses of Lender (including, without limitation, attorney’s
fees and costs) incurred in connection with the exercise of any of its rights or
remedies in accordance with the applicable provisions of this Agreement.

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(iv) If, pursuant to Subsection 365(h) of the Bankruptcy Code, Borrower seek to
offset, against the rent reserved in the Ground Lease, the amount of any damages
caused by the nonperformance by the lessor of any of its obligations thereunder
after the rejection by lessor of the Ground Lease under the Bankruptcy Code,
then Borrower shall not affect any offset of the amounts so objected to by
Lender. If Lender has failed to object as aforesaid within ten (10) days after
notice from Borrower in accordance with the first sentence of this clause,
Borrower may proceed to offset the amounts set forth in Borrower’s notice.

(v) If any action, proceeding, motion or notice shall be commenced or filed in
respect of any lessor of all or any part of the applicable Property in
connection with any case under the Bankruptcy Code, Lender and Borrower shall
cooperatively conduct and control any such litigation with counsel agreed upon
between Borrower and Lender in connection with such litigation. Borrower shall,
upon demand, pay to Lender all costs and expenses (including attorneys’ fees and
costs) incurred in connection with the cooperative prosecution or conduct of any
such proceedings. All such costs and expenses shall be secured by the lien of
the related Mortgage.

(vi) Borrower shall notify Lender (upon any of Borrower becoming aware of the
same) of any filing by or against the lessor under the Ground Lease of a
petition under the Bankruptcy Code, setting forth any information available to
Borrower as to the date of such filing, the court in which such petition was
filed, and the relief sought in such filing. Borrower shall deliver to Lender
any and all notices, summonses, pleadings, applications and other documents
received by Borrower in connection with any such petition and any proceedings
relating to such petition.

(l) If Lender, its nominee, designee, successor, or assignee acquires title
and/or rights of Borrower under the Ground Lease by reason of foreclosure of the
applicable Mortgage, deed in lieu of foreclosure or otherwise, insofar as
Borrower may be concerned and subject to the provisions of the Ground Lease,
such party shall (x) succeed to all of the rights of and benefits accruing to
Borrower under the Ground Lease, and (y) be entitled to exercise all of the
rights and benefits accruing to Borrower under the Ground Lease. At such time as
Lender shall request, Borrower agree to execute and deliver and use commercially
reasonable efforts to cause any third party to execute and deliver to Lender
such documents as Lender and its counsel may reasonably require in order to
insure that the provisions of this section will be validly and legally
enforceable and effective against Borrower and all parties claiming by, through,
under or against Borrower.

(m) Anything contained herein to the contrary notwithstanding, it shall
constitute an immediate Event of Default if (i) a default by any Borrower occurs
under the Ground Lease and continues beyond the expiration of any applicable
cure period set forth therein, such that the landlord thereunder would have the
right to terminate the applicable Ground Lease, (ii) there occurs any event or
condition that gives the lessor under the Ground Lease a right to terminate or
cancel the Ground Lease, (iii) any Ground Lease shall be terminated, cancelled
or forfeited for any reason or under any circumstance whatsoever, or (iv) any of
the terms, covenants or conditions of the Ground Lease shall in any manner be
modified, changed, supplemented, altered, or amended without the prior written
consent of Lender, except as expressly required pursuant to the terms and
conditions of the Ground Lease.”

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(k) Section 7.27 is hereby deleted in its entirety and replaced with the
following:

“Joint and Several Liability.

(a) The representations, covenants, warranties and obligations of Borrower
hereunder are joint and several. In the event of (i) any payment by any one or
more of the Borrower of any amount in excess of its respective Proportional
Amount, or (ii) the foreclosure of, or the delivery of deeds in lieu of
foreclosure relating to, any of the Collateral owned by one or more of the
Borrowers, each Borrower (the “Overpaying Borrower”) that has paid more than its
Proportional Amount or whose Collateral or assets have been utilized to satisfy
obligations under the Loan or otherwise for the benefit of one or more other
Borrowers shall be entitled, after payment in full of the Indebtedness and the
satisfaction of all the Borrowers’ other obligations to the Lender under the
Loan Documents, to contribution from each of the benefited Borrowers (i.e., the
Borrowers, other than the Overpaying Borrower, who have paid less than their
respective Proportional Amount or whose Collateral or assets have not been so
utilized to satisfy obligations under the Loan), for the amounts so paid,
advanced or benefited, up to such benefited Borrower’s then current Proportional
Amount. Such right to contribution shall be subordinate in all respects to the
Loan. As used herein, the “Proportional Amount” with respect to any Borrower
shall equal the amount derived as follows: (a) the ratio of the aggregate amount
of the Loan allocable to the Property or Properties in which such Borrower has
an interest to the then outstanding Principal Indebtedness; times (b) the
aggregate amount paid or payable by the Borrowers under the Loan Documents
(including interest). Notwithstanding the foregoing or anything in this
Agreement or the other Loan Documents to the contrary, no Borrower other than
Amendment Date Advance Borrower shall have any liabilities or obligations
hereunder or under any other Loan Documents in connection with the Amendment
Date Advance or the Second Additional Properties.

(b) Notwithstanding the foregoing or anything in this Agreement or the other
Loan Documents to the contrary, the maximum amount of the Principal Indebtedness
that each of the following Borrowers shall be liable for under the Loan
Documents shall be limited to the amount listed next to each such Borrower’s
name below:

(i) Maxserv, Inc. - $25,410,000.

(ii) Troy Coolidge No. 13, LLC - $4,070,000

(iii) Sears Holdings Management Corporation - $321,070,000

(iv) SHC Desert Springs, LLC - $7,370,000

(v) KMART Stores of Illinois LLC - $78,520,000

(vi) KMART of Washington LLC - $84,790,000.

Section 2. Miscellaneous.

(a) All of the terms and conditions of the Loan Agreement are incorporated
herein by reference with the same force and effect as if fully set forth herein.
Except as expressly amended hereby, the Loan Agreement and each of the other
Loan Documents remains in full force and effect in accordance with its terms.

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(b) Borrower hereby represents and warrants that (i) Borrower has the power and
authority to enter into this Amendment, to perform its obligations under the
Loan Agreement as amended hereby, (ii) Borrower has by proper action duly
authorized the execution and delivery of this Amendment by Borrower and
(iii) this Amendment has been duly executed and delivered by Borrower and
constitutes Borrower’s legal, valid and binding obligations, enforceable in
accordance with its terms, subject to bankruptcy, insolvency and similar laws of
general applicability relating to or affecting creditors’ rights and to general
equity principles.

(c) This Amendment shall be governed by and construed and interpreted in
accordance with the laws of the State of New York without regard to principles
of conflicts of law.

(d) Borrower hereby (1) unconditionally ratifies and confirms, renews and
reaffirms all of its obligations under the Loan Agreement and each of the other
Loan Documents, (2) acknowledges and agrees that such obligations remain in full
force and effect, binding on and enforceable against it in accordance with the
terms, covenants and conditions of the Loan Agreement as amended hereby and the
other Loan Documents, in each case, without impairment, and (3) represents,
warrants and covenants that it is not in default under the Loan Agreement or any
of the other Loan Documents beyond any applicable notice and cure periods, and
there are no defenses, offsets or counterclaims against the Indebtedness.

(e) Sears Holdings Corporation hereby (1) unconditionally approves and consents
to the execution by Borrower of this Amendment and the modifications to the Loan
Documents effected thereby, (2) unconditionally ratifies, confirms, renews and
reaffirms all of its obligations under the Guaranty and the Environmental
Indemnity (collectively, the “Guarantor Documents”), (3) acknowledges and agrees
that its obligations under the Guarantor Documents remain in full force and
effect, and shall continue to remain in full force during each Extension Term,
binding on and enforceable against it in accordance with the terms, covenants
and conditions of such documents without impairment and reaffirms such
obligations under the Guarantor Documents to guaranty the obligations of
Borrower under the Loan Agreement and other Loan Documents, and (4) represents,
warrants and covenants that (i) it is not in default under the Guaranty beyond
any applicable notice and cure periods, (ii) there are no defenses, offsets or
counterclaims against its obligations under the Guaranty and (iii) it has the
power and authority to enter into this Amendment and has by proper action duly
authorized its execution and delivery of this Amendment.

(f) Borrower shall reimburse Lender for all reasonable out-of-pocket fees and
expenses of legal counsel incurred by Lender in connection with this Amendment.

(g) This Amendment may be executed in any number of counterparts, each of which
when so executed and delivered shall be an original, but all of which shall
together constitute one and the same instrument. Copies of originals, including
copies delivered by facsimile, pdf or other electronic means, shall have the
same import and effect as original counterparts and shall be valid, enforceable
and binding for the purposes of this Amendment.

[Signatures appear on following page]

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The parties hereto are executing this Amendment as of the date first above
written.

 

AGENT AND LENDER:

JPP, LLC,

a Delaware limited liability company, as Agent and Lender

By:  

/s/ Edward S. Lampert

Name: Edward S. Lampert Title: Authorized Signatory LENDER:

JPP II, LLC,

a Delaware limited liability company, as Lender

By:  

/s/ Edward S. Lampert

Name: Edward S. Lampert Title: Authorized Signatory

[Signatures continue on following page.]

 

Dove – First Amendment to Third A&R Loan Agreement

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LENDER:

CASCADE INVESTMENT, L.L.C.,

a Washington limited liability company

By:  

/s/ Michael Larson

Name: Michael Larson Title: Business Manager

[Signatures continue on following page.]

 

Dove – First Amendment to Third A&R Loan Agreement

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BORROWER:

SEARS, ROEBUCK AND CO.,

a New York corporation

By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: Chief Financial Officer

KMART CORPORATION,

a Michigan corporation

By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: Chief Financial Officer

KMART STORES OF ILLINOIS LLC,

an Illinois limited liability company

By: Kmart Corporation, a Michigan corporation, as Sole Member By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: Chief Financial Officer

KMART OF WASHINGTON LLC,

a Washington limited liability company

By: Kmart Corporation, a Michigan corporation, as Sole Member By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: Chief Financial Officer

[Signatures continue on following page.]

 

Dove – First Amendment to Third A&R Loan Agreement

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SHC DESERT SPRNGS, LLC,

a Delaware limited liability company

By: Kmart Corporation, a Michigan corporation, as Sole Member By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: Chief Financial Officer

INNOVEL SOLUTIONS, INC.,

a Delaware corporation

By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: Chief Financial Officer

SEARS HOLDINGS MANAGEMENT CORPORATION,

a Delaware corporation

By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: President

MAXSERV, INC.,

a Delaware corporation

By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: Vice President

[Signatures continue on following page.]

 

Dove – First Amendment to Third A&R Loan Agreement

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TROY COOLIDGE NO. 13, LLC,

a Michigan limited liability company

By: Kmart Corporation, a Michigan corporation, as Sole Member By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: Chief Financial Officer

BIG BEAVER OF FLORIDA DEVELOPMENT, LLC,

a Florida limited liability company

By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: President

SEARS DEVELOPMENT CO.,

a Delaware corporation

By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: President

 

Dove – First Amendment to Third A&R Loan Agreement

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Solely with respect to Section 2(e) hereof: GUARANTOR:

SEARS HOLDINGS CORPORATION,

a Delaware corporation

By:  

/s/ Robert A. Riecker

  Name: Robert A. Riecker   Title: Chief Financial Officer

[Signatures continue on following page.]

 

Dove – First Amendment to Third A&R Loan Agreement