Exhibit 10.1

Execution Version                    

THIRD AMENDMENT TO

LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT

THIRD AMENDMENT TO LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT (this
“Amendment”) dated as of August 9, 2017 among

SEARS HOLDINGS CORPORATION, a Delaware corporation (“Holdings”),

SEARS ROEBUCK ACCEPTANCE CORP., a Delaware corporation, and KMART CORPORATION, a
Michigan corporation (the “Borrowers”),

JPP, LLC and JPP II, LLC, as L/C Lenders, and

CITIBANK, N.A., as Administrative Agent (the “Agent”) and Issuing Bank (the
“Issuing Bank”),

in consideration of the mutual covenants herein contained and benefits to be
derived herefrom.

W I T N E S S E T H:

WHEREAS, Holdings, the Borrowers, the L/C Lenders party thereto, the Agent and
the Issuing Bank, are party to that certain Letter of Credit and Reimbursement
Agreement (as amended pursuant to that certain First Amendment to Letter of
Credit and Reimbursement Agreement dated as of March 2, 2017 and pursuant to
that certain Second Amendment to Letter of Credit and Reimbursement Agreement
dated as of August 1, 2017, the “Existing LC Facility Agreement”; the Existing
LC Facility Agreement as amended hereby, the “Amended LC Facility Agreement”);
and

WHEREAS, Holdings, the Borrowers, the Required L/C Lenders, the Issuing Bank and
the Agent have agreed to amend the Existing LC Facility Agreement.

NOW THEREFORE, in consideration of the mutual promises and agreements herein
contained, the parties hereto hereby agree as follows:

 

1. Incorporation of Terms. All capitalized terms not otherwise defined herein
shall have the same meaning as in the Existing LC Facility Agreement.

 

2. Representations and Warranties. Each Borrower hereby represents and warrants
that (i) no Default or Event of Default exists under the Existing LC Facility
Agreement or under any other Loan Document as of the date hereof, and (ii) all
representations and warranties contained in the Amended LC Facility Agreement
and the other Loan Documents are true and correct in all material respects as of
the date hereof, except to the extent that (A) such representations or
warranties are qualified by a materiality standard, in which case they are true
and correct in all respects, and (B) such representations or warranties
expressly relate to an earlier date (in which case such representations and
warranties are true and correct in all material respects as of such earlier
date).

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3. Release by Borrowers. Each Borrower hereby acknowledges and agrees that it
has no actual knowledge of any defenses or claims against any L/C Lender, the
Agent, the Issuing Bank, any of their Affiliates, or any of their respective
officers, directors, employees, attorneys, representatives, predecessors,
successors, or assigns with respect to the Obligations, and that if such
Borrower now has, or ever did have, any defenses or claims with respect to the
Obligations against any L/C Lender, the Agent, the Issuing Bank or any of their
respective officers, directors, employees, attorneys, representatives,
predecessors, successors, or assigns, whether known or unknown, at law or in
equity, from the beginning of the world through this date and through the time
of effectiveness of this Amendment, all of them are hereby expressly WAIVED, and
each Borrower hereby RELEASES each L/C Lender, the Agent, the Issuing Bank and
their respective officers, directors, employees, attorneys, representatives,
predecessors, successors, and assigns from any liability therefor.

 

4. Amendments to Existing LC Facility Agreement. Each of the parties hereto
agrees that, effective as of the Amendment Effective Date (as defined below),
the Existing LC Facility Agreement shall be amended as follows:

 

  a. The definition of “Required L/C Lender” set forth in Section 1.01 of the
Existing LC Facility is hereby amended and restated in its entirety as follows:

“‘Required L/C Lenders’” means, at any time, the holders of more than 50% of the
Aggregate L/C Commitments then in effect, or, if the Aggregate L/C Commitments
have been terminated, the holders of more than 50% of the L/C Lender Exposure
then outstanding; provided that if ESL holds less than 50% of the Aggregate L/C
Commitments, or, if the Aggregate L/C Commitments have been terminated, less
than 50% of the L/C Lender Exposure then outstanding, “Required L/C Lenders”
means all of the L/C Lenders.”

 

  b. The definition of “L/C Commitment” set forth in Section 1.01 of the
Existing LC Facility is hereby amended by restating in full clause (iii) set
forth therein as follows:

“(iii) by an amount equal to the face amount of any Letter of Credit that has
been returned to the Agent for cancellation prior to the L/C Termination Date,
unless a replacement therefor is issued within 30 days after the Reduction
Election Date (but, in any event, prior to the L/C Termination Date) to the same
or similar beneficiary and the Required L/C Lenders have provided their consent
in writing to the issuance of such replacement (such consent not to be
unreasonably conditioned, delayed or withheld); provided, that (x) the Agent
shall promptly notify each L/C Lender that a Letter of Credit has been returned
to it for cancellation and any L/C Lender may, by written notice to the Agent no
later than

 

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three (3) Business Days after the date of such notification from the Agent (the
“Reduction Election Period”), elect to waive any reduction of its L/C Commitment
pursuant to this clause (iii) so long as the aggregate amount in such L/C
Lender’s Lender Cash Collateral Account would not be less than 102% of its L/C
Commitment Percentage times the Issuer Exposure both immediately before and
immediately after giving effect to such waiver and (y) no later than two
(2) Business Days after the expiration of the Reduction Election Period, the
Agent shall notify each L/C Lender of the election made by each other L/C Lender
pursuant to the foregoing clause (x) and each L/C Lender may by written notice
to the Agent no later than one (1) Business Day after the date of such
notification from the Agent update such election so long as the aggregate amount
in such L/C Lender’s Lender Cash Collateral Account would not be less than 102%
of its L/C Commitment Percentage times the Issuer Exposure both immediately
before and immediately after giving effect to such election (the Business Day
after the date of such notification, the “Reduction Election Date”),”

 

  c. Section 1.01 of the Existing LC Facility Agreement is hereby amended by
adding: the following definitions in alphabetical order:

 

  i. “ESL” means, collectively, JPP, LLC and JPP II, LLC, each a Delaware
limited liability company, and their Affiliates.

 

  ii. “Non-Affiliated Lender” means any L/C Lender that is not ESL.

 

  iii. “Non-Consenting Non-Affiliated Lender” has the meaning specified in
Section 9.16.

 

  iv. “Reduction Election Date” has the meaning specified in the definition of
“L/C Commitment”.

 

  d. Section 5.01(aa) of the Existing LC Facility Agreement is hereby amended
and restated in its entirety as follows: “As of the Amendment No. 2 Effective
Date, except for this Agreement, each Letter of Credit and all Obligations under
this Loan Documents, and except as set forth on Schedule 5.01(aa), none of the
Loan Parties have any Bank Products or Cash Management Services.”

 

  e. Section 6.02(m)(v) of the Existing LC Facility Agreement is hereby deleted.

 

  f. Section 9.16 of the Existing LC Facility Agreement is hereby amended and
restated in its entirety as follows:

“Section 9.16. Replacement of L/C Lenders. If (A) any L/C Lender requests
compensation under Section 2.12 or if the Borrowers are required to pay any
additional amount to any L/C Lender or any Governmental Authority for the
account of any L/C Lender pursuant to Section 2.15, if any L/C Lender does not

 

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consent (a “Non-Consenting Lender”) to a proposed amendment, waiver, consent or
release with respect to any Loan Document that requires the consent of each L/C
Lender and that has been approved by the Required L/C Lenders (to the extent
“Required L/C Lenders” is not defined as all L/C Lenders pursuant to the
definition thereof), then the Borrowers may, at their sole expense and effort,
upon notice to such L/C Lender and the Agent, require such L/C Lender to assign
and delegate, without recourse (in accordance with and subject to the
restrictions contained in, and consents required by, Section 9.07), all of its
interests, rights and obligations under this Agreement and the related Loan
Documents to an assignee that shall assume such obligations (which assignee may
be another L/C Lender, if a L/C Lender accepts such assignment) or (B) a
Non-Affiliated Lender does not consent to a proposed amendment, waiver, consent
or release with respect to this Agreement or any other Loan Document (any such
L/C Lender being referred to as a “Non-Consenting Non-Affiliated Lender”;
provided that if such Non-Affiliated Lender has not given the Agent written
notice of its consent or waiver within five (5) Business Days after request
therefore, such Non-Affiliated Lender shall be deemed to be a Non-Consenting
Non-Affiliated Lender), then, at the sole option of ESL (regardless of whether
ESL is then an L/C Lender), upon written notice to such Non-Consenting
Non-Affiliated Lenders, all of such Non-Consenting Non-Affiliated Lenders’
interests, rights and obligations under this Agreement and the related Loan
Documents shall be assigned and delegated to ESL and ESL shall assume such
obligations; provided that, in each case of clauses (A) and (B) above:

(a) the Borrowers shall have paid to the Agent the assignment fee specified in
Section 9.07;

(b) such L/C Lender shall have received payment of an amount equal to its
ratable share of the outstanding Reimbursement Obligations actually funded by
such L/C Lender, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder and under the other Loan Documents from the assignee (to
the extent of such outstanding Reimbursement Obligations, interest and fees) or
the Borrowers (in the case of all other amounts); provided that such L/C Lender
shall not be entitled to a payment under Section 2.07 unless the consent or
waiver being sought pursuant to Section 9.16(B) is an amendment, modification or
waiver of Section 2.07 with the primary purpose of eliminating the payment
described therein;

(c) in the case of any such assignment resulting from a claim for compensation
under Section 2.12 or payments required to be made pursuant to Section 2.15,
such assignment will result in a reduction in such compensation or payments
thereafter;

 

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(d) with respect to the replacement of any Non-Consenting Lender or any
Non-Consenting Non-Affiliated Lender, such amendment, waiver or consent can be
effected as a result of such assignment (together with all other assignments
required by the Agent to be made pursuant to this paragraph); and

(e) such assignment does not conflict with applicable laws.

An L/C Lender shall not be required to make any such assignment or delegation
required by Section 9.16(A) if, prior thereto, as a result of a waiver by such
L/C Lender or otherwise, the circumstances entitling the Borrowers to require
such assignment and delegation cease to apply. Notwithstanding anything herein
to the contrary, each party hereto agrees that an assignment or delegation
required pursuant to Section 9.16(B) shall be effected pursuant to an Assignment
and Acceptance executed by the Borrowers, the Agent and ESL and that the
Non-Consenting Non-Affiliated Lender required to make such assignment need not
be a party thereto, and each L/C Lender hereby authorizes and directs the Agent
to execute and deliver such documentation as may be required to give effect to
an assignment or delegation in accordance with Section 9.16(B) on behalf of a
Non-Consenting Non-Affiliated Lender and any such documentation so executed by
the Agent shall be effective for purposes of documenting an assignment pursuant
to Section 9.07.”

 

5. Conditions to Effectiveness. This Amendment shall become effective on the
date (the “Amendment Effective Date”) that each of the following conditions
precedent has been fulfilled as determined by the Agent:

 

  a. This Amendment shall have been duly executed and delivered by Holdings, the
Borrowers, the Required L/C Lenders, the Issuing Bank and the Agent, and the
Agent shall have received counterparts hereof that, when taken together, bear
the signatures of each of the other parties hereto.

 

  b. All action on the part of Holdings and the Borrowers necessary for the
valid execution, delivery and performance by the Borrowers of this Amendment
shall have been duly taken. The Agent shall have received corporate resolutions
of Holdings authorizing the entrance of Holdings into this Amendment.

 

  c. Since January 30, 2017, there shall not have been any event or effect that
has had or would be reasonably expected to have, individually or in the
aggregate, a Material Adverse Effect.

 

  d. After giving effect to this Amendment and the transactions contemplated
hereunder, Capped Excess Availability shall not be less than $150,000,000.

 

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  e. After giving effect to this Amendment and the transactions contemplated
hereunder, no Default or Event of Default shall have occurred and be continuing
under the Amended LC Facility Agreement.

 

  f. The Borrowers shall have paid all fees, expenses and other amounts due and
owing to the Agent, the Issuing Bank and the L/C Lenders that have executed this
Amendment.

 

6. Binding Effect. The terms and provisions hereof shall be binding upon and
inure to the benefit of the parties hereto, the L/C Lenders, the Issuing Bank
and their respective successors and assigns.

 

7. Expenses. The Borrowers shall reimburse the Agent and the L/C Lenders for all
reasonable and documented out-of-pocket expenses incurred in connection
herewith, including, without limitation, reasonable attorneys’ fees.

 

8. Multiple Counterparts. This Amendment may be executed in multiple
counterparts, each of which shall constitute an original and together which
shall constitute but one and the same instrument. Delivery of an executed
counterpart of a signature page of this Agreement by facsimile or in electronic
(i.e. “pdf” or “tif”) format shall be effective as delivery of a manually
executed counterpart of this Agreement.

 

9. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES THEREOF OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK
GENERAL OBLIGATIONS LAW.

 

10. Jurisdiction. Section 9.11 of the Existing LC Facility Agreement is hereby
incorporated by reference, mutatis mutandis, as if it were fully set forth in
this Amendment.

 

11. WAIVER OF JURY TRIAL. EACH OF HOLDINGS, THE BORROWERS, THE AGENT, THE
ISSUING BANK AND THE L/C LENDERS HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT
OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AMENDMENT OR THE OTHER LOAN
DOCUMENTS OR THE ACTIONS OF THE AGENT, THE ISSUING BANK OR ANY L/C LENDER IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF OR THEREOF.

 

12.

L/C Lender Reaffirmation. Each L/C Lender hereby confirms its assignments,
pledges and grants of security interests, as applicable, under the Cash
Collateral Agreement, and agrees that such assignments, pledges and grants of
security interests shall continue to be in full force and effect, shall continue
to secure full payment and performance of the

 

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  “Obligations” (as defined in the Cash Collateral Agreement) of such L/C
Lender, and shall accrue to the benefit of the Secured Party for its benefit and
the benefit of the Agent and the Issuing Bank.

 

13. No Novation. Neither this Amendment nor the Amended LC Facility Agreement
shall extinguish the Obligations under and as defined in the Cash Collateral
Agreement or discharge or release the priority of the Cash Collateral Agreement
or any other security therefor. Nothing contained herein or in the Amended LC
Facility Agreement shall be construed as a substitution or novation of the
Obligations under and as defined in the Cash Collateral Agreement or instruments
securing the same, which shall remain in full force and effect. Nothing implied
in this Amendment, the Amended LC Facility Agreement or in any other document
contemplated hereby or thereby shall be construed as a release or other
discharge of any L/C Lender from any of its Obligations under and as defined in
the Cash Collateral Agreement.

[Remainder of page intentionally left blank; Signature pages follow.]

 

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IN WITNESS WHEREOF, this Amendment has been duly executed and delivered by each
of the parties hereto as of the date first above written.

 

HOLDINGS: SEARS HOLDINGS CORPORATION By:  

/s/ Robert A. Riecker

Name:   Robert A. Riecker Title:   Chief Financial Officer BORROWERS: SEARS
ROEBUCK ACCEPTANCE CORP. By:  

/s/ Robert A. Riecker

Name:   Robert A. Riecker Title:   Vice President, Finance KMART CORPORATION By:
 

/s/ Robert A. Riecker

Name:   Robert A. Riecker Title:   Controller and Head of Capital Market
Activities

[Signature page to LC and Reimbursement Agreement Amendment]

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Citibank, N.A., as Agent and as Issuing Bank By:  

/s/ Christopher Marino

  Name:   Christopher Marino   Title:   Vice President and Director

[Signature page to LC and Reimbursement Agreement Amendment]

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JPP, LLC, as an L/C Lender By:  

/s/ Edward S. Lampert

  Name:   Edward S. Lampert   Title:   Member JPP II, LLC, as an L/C Lender By:
  RBS Partners, L.P., as Manager By:   ESL Investments, Inc., as General Partner
By:  

/s/ Edward S. Lampert

  Name:   Edward S. Lampert   Title:   Chairman and Chief Executive Officer

[Signature page to LC and Reimbursement Agreement Amendment]