2. Amendment to Article 1 of Loan Agreement. The provisions of Article 1 of the LoanAgreement are hereby amended as follows: a. By deleting the definitions of “NCB” and “NCBC” in their entirety andsubstituting the following new definitions in their stead:““**NCB**”: PNC Bank, a national banking association (as successor to NationalCity Bank), and its successors and assigns.”““**NCBC**”: PNC Bank, a national banking association (as successor to NationalCity Bank (as successor to National City Business Credit, Inc.)), and itssuccessors and assigns.” b. By adding the following new definition in the proper alphabetical order:““**First Amendment Effective Date**”: January 6, 2010.”3. Amendments to Article 5 of Loan Agreement. The provisions of Article 5 of the LoanAgreement are hereby amended as follows: a. The provisions of Section 5.16 of the Loan Agreement are hereby amended asfollows: i. By deleting clause (b) thereof in its entirety andsubstituting in its stead the following new clause (b):“(b) (i) (A) On one occasion between the First Amendment EffectiveDate and January 31, 2010, and (B) on one occasion between February 1,2010 and April 30, 2010, DSW may make cash payments for the purpose ofpurchasing from the Parent a portion of DSW’s capital stock if (w) noDefault or Event of Default shall have occurred and be continuing at thetime of declaration or payment thereof, (x) the aggregate amount soexpended does not exceed $10,000,000 on each such occasion, (y)immediately after giving effect to the making of such payment, (1) theLoan Parties’ cash, cash equivalents and short-term investments shall beequal to or greater than $200,000,000, and (2) there shall be no RevolvingCredit Loans then outstanding, and (z) the Loan Parties shall haveprovided to the Administrative Agent evidence, in form and substancesatisfactory to the Administrative Agent, of satisfaction of theconditions contained in clause (y) above on a basis satisfactory to theAdministrative Agent, provided that any payments not made duringthe period described in clause (i)(A) above shall be deemed waived andshall not be permitted to be made during the period described in clause(i)(B) above or on any other occasion; and(ii) in addition to amounts to be paid under clause (i) hereof, own,redeem, retire, purchase, or acquire any of any Loan Party’s capitalstock; provided that the Loan Parties may make cash payments for any suchpurposes if:(A) no Default or Event of Default shall have occurred and becontinuing at the time of declaration or payment thereof; and(B) after giving effect to the making of any such cashpayment, the aggregate amount so expended for such purposessubsequent to the Effective Date does not exceed $1,500,000; and(C) after giving effect to the making of any such cashpayment, the aggregate amount so expended for such purposes in anyfiscal year of the Borrowers does not exceed $500,000.”
 
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 ii. By adding the following new language at the beginning ofclause (c) thereof:“Except as permitted pursuant to clause (b) hereof,” b. The provisions of Section 5.20(a) of the Loan Agreement are hereby amended bydeleting the word “or” at the end of clause (iii) thereof, re-numbering clause (iv)thereof as clause (v), and inserting the following new clause (iv) in its stead:“(iv) transactions permitted pursuant to Section 5.16(b)(i) hereof, or”4. Amendments to Article 18.1 of Loan Agreement. The provisions of Section 18.1 of theLoan Agreement are hereby amended by deleting the notice address provided for theAdministrative Agent and substituting the following new notice address in its stead:“If to the Administrative Agent:       PNC Bank  1965 E. Sixth Street  Cleveland, Ohio 44114  Attention : Anthony Alexander  Fax : (216) 222-8155*With a copy to*:       Riemer & Braunstein LLP  Three Center Plaza  Boston, Massachusetts 02108  Attention : David S. Berman, Esquire  Fax : (617) 880-3456”5. Representations and Warranties. The Borrowers hereby restate and reaffirm allrepresentations, warranties, and covenants set forth in the Loan Agreement and the other LoanDocuments as of the date hereof.6. Conditions Precedent to Effectiveness. This First Amendment shall not be effectiveuntil each of the following conditions precedent has been fulfilled to the satisfaction of theAdministrative Agent: a. This First Amendment shall have been duly executed and delivered by theparties hereto, and shall be in full force and effect and shall be in form andsubstance satisfactory to the Administrative Agent and the Majority Lenders. b. All action on the part of the Borrowers necessary for the valid execution,delivery and performance by the Borrowers of this First Amendment and all otherdocumentation, instruments, and agreements to be executed in connection herewith shallhave been duly and effectively taken and evidence thereof satisfactory to theAdministrative Agent shall have been provided to the Administrative Agent. c. No Default or Event of Default shall be then occurring. d. The Loan Parties shall have executed and delivered to the AdministrativeAgent such other documents, instruments, and agreements as may be required by theAdministrative Agent.
 
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7. Miscellaneous. a. This First Amendment may be executed in several counterparts and by eachparty on a separate counterpart, each of which, when so executed and delivered, shallbe an original, and all of which, together with the Loan Agreement, shall constituteone instrument. This First Amendment shall constitute a Loan Document for allpurposes. b. This First Amendment expresses the entire understanding of the parties withrespect to the transactions contemplated hereby. No prior negotiations or discussionsshall limit, modify, or otherwise affect the provisions hereof. c. Each of the Borrowers hereby ratifies, confirms, and reaffirms allrepresentations, warranties, and covenants set forth in the Loan Agreement and theother Loan Documents as of the date hereof. Except as expressly modified herein, allterms and conditions of the Loan Agreement and the other Loan Documents remain in fullforce and effect. d. Any determination that any provision of this First Amendment or anyapplication hereof is invalid, illegal or unenforceable in any respect and in anyinstance shall not affect the validity, legality, or enforceability of such provisionin any other instance, or the validity, legality or enforceability of any otherprovisions of this First Amendment. e. The Loan Parties shall pay on demand all reasonable costs and expenses of theAdministrative Agent, including, without limitation, reasonable attorneys’ fees inconnection with the preparation, negotiation, execution and delivery of this FirstAmendment. f. This First Amendment and all rights and obligations hereunder, includingmatters of construction, validity, and performance, shall be governed by the law ofState of Ohio.[**SIGNATURE PAGES FOLLOW**]
 
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IN WITNESS WHEREOF, the parties have duly executed this First Amendment as of the day and yearfirst above written.      DSW INC., as Lead Borrower and as a Borrower