Exhibit 10.21

Sears Supplemental 401(k) Savings Plan

SECTION 1

General

     1.1   History, Purpose and Effective Date. Sears, Roebuck and Co. (the
“Company”) has established the Sears 401(k) Savings Plan (the “401(k) Plan”)
formerly known as the Sears 401(k) Profit Sharing Plan, formerly known as the
Savings and Profit Sharing Fund of Sears Employees, to encourage eligible
employees to save a portion of their earnings, to accumulate capital for their
future economic security, to share in the profits of the Company, and to acquire
a proprietary interest in the Company. The Company established as of January
1994, the Sears Supplemental 401(k) Savings Plan, formerly known as the Sears,
Roebuck and Co. Management Supplemental Deferred Profit Sharing Plan (the
“Plan”) to enable certain highly-compensated participants in the 401(k) Plan to
receive the maximum amount of Company matching contributions they would have
been entitled to receive under the 401(k) Plan had the limit on compensation
permitted to be taken into account, with respect to the 401(k) Plan, under
section 401(a)(17) of the Internal Revenue Code of 1986, as amended (the “Code”)
not been reduced effective January 1, 1994. The Plan is intended to constitute a
plan maintained primarily for the purpose of providing deferred compensation for
a select group of management or highly-compensated employees within the meaning
of sections 201(2), 301(a)(3), and 401(a)(1) of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”). The

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following provisions constitute an amendment, restatement and continuation of
the Plan effective as of January 1, 2001.

     1.2   Administration. (a) The Company is the Plan Administrator of the
Plan. The Plan Administrator may delegate all or any part of its
responsibilities and powers to any person or persons selected by it. Any such
delegation may be revoked at any time. The Secretary of the Company (or, on
behalf of the Company, an Assistant Secretary) shall certify to any interested
person the names of the employees of the Company who are, from time to time,
authorized to act on behalf of the Plan Administrator and who are responsible
for the day-to-day operation and administration of the Plan. Any interpretation
of the Plan or factual finding by the Plan Administrator or its delegate and any
decision made by the Plan Administrator or its delegate on any other matter
within its discretion is final and binding on all persons.

     (b)  The Plan Administrator hereby delegates to the plan administrator of
the 401(k) Plan the power and responsibility to take all actions assigned to or
permitted to be taken by the Plan Administrator under Sections 3 and 4 hereof
until such time the delegation is revoked.

     1.3   Plan Year. The term “Plan Year” means the calendar year.

     1.4   Source of Benefit Payments. Any amount payable to or on account of a
Participant under this Plan shall be paid from the general assets of the Company
or from one or more trusts, the assets of which are subject to the claims of the
Company’s general creditors. The amounts payable hereunder shall be reflected on
the accounting records of the Company but shall not be

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construed to create, or require the creation of, a trust, custodial or escrow
account. None of the individuals entitled to benefits under the Plan shall have
any preferred claim on, or any beneficial ownership interest in, any assets of
the Company or to any investment reserves, accounts, trusts or funds that the
Company may purchase, establish or accumulate to aid in providing the benefits
under the Plan, and any rights of such individuals under the Plan shall
constitute only unsecured contractual rights. Nothing contained in the Plan
shall constitute a guarantee by the Company that the assets of the Company shall
be sufficient to pay any benefits to any person. The Plan and any action taken
pursuant to its provisions shall not create a trust or fiduciary relationship of
any kind between the Company and an employee or any other person, or between any
person who may perform services on behalf of the Plan and any other person.

     1.5   Expenses. The expenses of administering the Plan shall be borne by
the Company.

     1.6   Effect on Other Benefit Plans. Any amounts credited or paid under
this Plan shall not be considered to be compensation for the purposes of any
qualified plan (within the meaning of section 401(a) of the Code) maintained by
the Company or any of its subsidiaries. The treatment of such amounts under
other employee benefit plans shall be pursuant to the provisions of such plans.

     1.7   Applicable Laws. The Plan shall be construed and administered in
accordance with the laws of the state of Illinois.

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     1.8   Gender and Number. Where the context admits, words in any gender
shall include any other gender, words in the singular shall include the plural
and the plural shall include the singular.

     1.9   Notices. Any notice or document required to be given to or filed with
the Plan Administrator will be properly filed if delivered or mailed by
registered mail, postage prepaid, to the plan administrator of the 401(k) Plan,
at the Company’s principal executive offices. The Plan Administrator may, by
advance written notice to affected persons, revise such notice procedure from
time to time. Any notice required under the Plan may be waived by the person
entitled to notice.

     1.10   Evidence. Evidence required of anyone under the Plan may be by
certificate, affidavit, document or other information which the person acting on
it considers pertinent and reliable, and signed, made or presented by the proper
party or parties.

     1.11   Action by the Company. Any action required or permitted to be taken
by the Company shall be by resolution of its Board of Directors or by a duly
authorized officer of the Company.

SECTION 2

Participation

     2.1   Participants. The key employees of the Company eligible to
participate in the Plan (the “Participants”) and the conditions for such
participation shall be established, from time to time, by the Company; provided,

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however, that Participants shall be limited to a select group of management or
highly-compensated employees within the meaning of sections 201(2), 301(a) (3),
and 401(a) (1) of ERISA. As of the Effective Date of the Plan, only management
employees of all participating employers of the 401(k) Plan are eligible to
participate in the Plan. If the Company determines that participation by one or
more Participants shall cause the Plan to be subject to Part 2, 3 or 4 of Title
I of ERISA, the entire interest of such Participant or Participants under the
Plan shall be immediately paid to such Participant or Participants or shall
otherwise be segregated from the Plan in the discretion of the Company, and such
Participant or Participants shall cease to have any interest under the Plan.

     2.2   Plan Not Contract of Employment. The Plan does not constitute a
contract of employment, and participation in the Plan will not give any employee
the right to be retained in the employ of the Company nor any right or claim to
any benefit under the Plan, unless such right or claim has specifically accrued
under the terms of the Plan.

SECTION 3

Matching Credits and Accounts

     3.1   Accounts. The Plan Administrator shall maintain, or cause to be
maintained, bookkeeping entries (“Accounts”) in the names of all Participants
which shall reflect the amount of Common Share Units credited to each
Participant in accordance with subsections 3.2 and 3.3.

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     3.2   Matching Credits. Subject to such terms, conditions, and limitations
as the Plan Administrator, from time to time, may establish, for each Plan Year
the Account of each Eligible Participant shall be credited with a “Matching
Credit” on the same date Company matching contributions are credited to his
account under the 401(k) Plan for that Plan Year. An individual who is eligible
to participate in the Plan in accordance with subsection 2.1 shall be an
“Eligible Participant” for a Plan Year if he is employed by the Company (or one
of its subsidiaries) on the first day following the close of the Plan Year and
he has made enough before-tax and/or after-tax contributions to the 401(k) Plan
for the Plan Year to be credited with the maximum amount of Company matching
contributions permitted under the 401(k) Plan for such year. An Eligible
Participant’s Matching Credit for each Plan Year shall be equal to the excess of
the total amount of Company matching contributions that would have been paid
under the terms of the 401(k) Plan to the Participant for that Plan Year had the
amount of compensation that could have been taken into account under the 401(k)
Plan been limited to $235,840 rather than $150,000 (or such other amount as may
be prescribed for such Plan Year under section 401(a) (17) of the Code), over
the actual amount of Company matching contributions credited to the account of
such Participant under the 401(k) Plan for such Plan Year. For purposes of the
preceding sentence, effective as of January 1, 1996, the amount of compensation
shall include any amounts deferred under the Sears, Roebuck and Co. Deferred
Compensation Plan. Beginning on January 1, 1995, an Eligible Participant shall
also include those participants who are participating in this Plan

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and meet all the requirements of the Plan except that they are not employed on
the first day following the close of the Plan year, and who are eligible for an
Employer’s Contribution under Section 5 of the 401(k) Plan provisions. Such
Eligible Participant’s Matching Credit for such plan year shall be prorated and
calculated under the same method which the 401(k) Plan administrator uses under
Section 5 of the 401(k) Plan provisions.

     3.3   Common Share Units. Matching Credits shall be converted to whole and
fractional Common Share Units as of the date such Matching Credits are credited
to Particpants’ Accounts, by dividing the dollar amount of each Participant’s
Matching Credits by the “fair market value” of the Company’s common shares
(which is, the closing price of the company’s common shares as reported for that
day or the nearest preceding business day). On the dividend record date for
Company common shares Dividend Equivalents shall be credited to the Accounts of
Participants who have Common Share Units credited to their Accounts as of the
dividend record date, which shall be converted into the number of Common Share
Units which could be purchased with the amount of Dividend Equivalents so
credited in the manner set forth in the preceding sentence. “Dividend
Equivalents” for this purpose means an amount equal to the cash dividend paid on
one of the Company’s common shares on such dividend payment date.

     3.4   Adjustment of Accounts. The amounts credited to a Participant’s
Account in accordance with subsection 3.3 shall be adjusted from time to time to
reflect a change in the Company’s outstanding common shares, by reason of any

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stock split, stock dividend, recapitalization, merger, consolidation,
combination, stock exchange or similar corporate change, as determined by the
Plan Administrator or its delegate in its sole discretion.

SECTION 4

Payment of Plan Benefits

     4.1   Vesting. A Participant at all times shall have a fully vested and
nonforfeitable interest in the amounts credited or required to be credited to
his Account under Section 3.

     4.2   Distribution. The fair market value of a Participant’s Account shall
be determined as of the first day of the month following the date on which the
Participant terminates employment with the company and its subsidiaries, and
shall be distributed in a lump sum in cash as soon thereafter as practicable.
Subsequent payments of pro-rated Matching Credits for the year in which
employment is terminated shall be paid at the fair market value of the date such
Matching Credits are credited to Participant’s Account and shall be paid as soon
as practicable, thereafter.

     4.3   Distribution upon Death; Beneficiary Designation. Each Participant
from time to time, by signing a form furnished by the plan administrator of the
401(k) Plan in accordance with the terms of subsection 11.4 of the 401(k) Plan,
may designate any legal or natural person or persons who are to be paid if he
dies before he receives his benefits under the Plan. A beneficiary designation

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form will be effective only when the signed form is filed with the plan
administrator of the 401(k) Plan while the Participant is alive and will cancel
all beneficiary designation forms filed earlier. The rules established by the
plan administrator of the 401(k) Plan for the beneficiary designation forms
shall apply to each Participant under this Plan. If a deceased Participant
failed to designate a beneficiary, in accordance with the above procedure, then
the Plan Administrator shall pay the Participant’s benefits under the Plan, as
soon as practicable after the participant’s death, in a lump sum cash payment
under the rules of subsection 11.4 of the 401(k) Plan. If the Participant dies
before he receives his benefit under the Plan the fair market value of his
Account shall be paid to his designated beneficiary or beneficiaries as soon as
practicable after his death in a lump sum cash payment.

     4.4   Distributions to Persons under Legal Disability. Notwithstanding the
provisions of this Section 4, if, in the Plan Administrator’s opinion, a
Participant or beneficiary is under a legal disability or is in any way
incapacitated so as to be unable to manage his financial affairs, the Plan
Administrator may direct that payment be made to a relative or friend of such
person for his benefit until claim is made by a conservator or other person
legally charged with the care of his person or his estate, and such payment
shall be in lieu of any such payment to such Participant or beneficiary.
Thereafter, any benefits under the Plan to which such Participant or beneficiary
is entitled, shall be paid to such conservator or other person legally charged
with the care of his person or his estate.

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     4.5   Benefits May Not be Assigned. Benefits payable under the Plan are
expressly declared to be unassignable and nontransferable. Neither the
Participant nor any other person shall have any voluntary or involuntary right
to sell, assign, pledge, anticipate, mortgage or otherwise encumber, transfer,
hypothecate or convey in advance of actual receipt, any benefits payable under
the Plan. No part of the benefits payable to a Participant shall be subject to
seizure or sequestration for payment of any debts, judgments, alimony or
separate maintenance owed by the Participant or any other person, or be
transferred by operation of law in the event of the Participant’s or any other
person’s bankruptcy or insolvency.

     4.6   Withholding for Tax Liability. The Plan Administrator may withhold or
cause to be withheld from any payment of benefits or from any wages payable to a
Participant made pursuant to the Plan any taxes required to be withheld and such
sum as the Plan Administrator may reasonably estimate to be necessary to cover
any taxes for which the Company may be liable and which may be assessed with
regard to such payment.

SECTION 5

Amendment and Termination

     While it is expected that the Plan will continue, the Company may terminate
the Plan or amend it from time to time, except that no amendment will reduce a
Participant’s interest in the Plan to less than an amount equal to the

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amount he would have been entitled to receive if he had resigned from the
Company on the day of the amendment. The Company may terminate the Plan at any
time provided that it has made adequate provisions for any amount payable by it
under the terms of the Plan, as in effect on the date of termination. Upon
termination of the Plan, the Company, in its discretion which would be applied
in a uniform manner to all Participants, may cause a lump sum payment of all
benefits for all Participants at substantially the same time.

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