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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 For The Fiscal Year Ended January 30, 2010
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission file number 1-10767
 RETAIL VENTURES, INC.
  Ohio
    
    20-0090238(State or other jurisdiction of incorporation or 
organization)
    
    (I.R.S. Employer Identification No.)4150 E. Fifth Avenue, Columbus, Ohio
    
    43219(Address of principal executive offices)
    
    (Zip Code)
   Title of each class:
    
    Name of each exchange on which registered:Common Shares, without par value
    
    New York Stock Exchange
  o Yes þ No
 o Yes þ No
 þ o
 o Yes o No
 o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE




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TABLE OF CONTENTS
 Item No.
    
    PagePART I1. Business
    
    
    51.A Risk Factors
    
    
    111.B Unresolved Staff Comments
    
    
    252. Properties
    
    
    263. Legal Proceedings
    
    
    264. Reserved
    
    
    26PART II5. Market for the Registrants Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities
    
    
    276. Selected Financial Data
    
    
    297. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    317A. Quantitative and Qualitative Disclosures about Market Risk
    
    
    468. Financial Statements and Supplementary Data
    
    
    479. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    479A. Controls and Procedures
    
    
    479B. Other Information
    
    
    47PART III10. Directors, Executive Officers and Corporate Governance
    
    
    4811. Executive Compensation
    
    
    4812. Security Ownership of Certain Beneficial Owners and Management and Related Shareholders Matters
    
    
    4813. Certain Relationships and Related Transactions, and Director Independence
    
    
    4914. Principal Accountant Fees and Services
    
    
    49PART IV15. Exhibits, Financial Statement Schedules
    
    
    50SIGNATURES
    
    
    51Exhibit 10.34.2Exhibit 10.58.2Exhibit 10.75.1Exhibit 10.102Exhibit 10.103Exhibit 12Exhibit 21Exhibit 23Exhibit 24Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
   1




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##### Table of Contents



TABLE OF CONTENTS TO FINANCIAL STATEMENTS
 Report of Independent Registered Public Accounting Firm
    
    
    F-1Consolidated Balance Sheets
    
    
    F-3Consolidated Statements of Operations
    
    
    F-5Consolidated Statements of Shareholders Equity
    
    
    F-7Consolidated Statements of Cash Flows
    
    
    F-9Notes to Consolidated Financial Statements
    
    
    F-11Schedule I:Condensed Balanced Sheets (Parent Company Only)
    
    
    S-1Condensed Statements of Operations (Parent Company Only)
    
    
    S-4Condensed Statements of Cash Flows (Parent Company Only)
    
    
    S-5Index to Exhibits
    
    
    E-1
  2




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PART I
   Cautionary Statement Regarding Forward-Looking Information for Purposes of the Safe Harbor
Provisions of the Private Securities Litigation Reform Act of 1995.
  
    
    our ability to manage and enhance liquidity;
 
    
    DSWs success in opening and operating new stores on a timely and profitable basis;
 
    
    continuation of DSWs supply agreements and the financial condition of its leased
business partners;
 
    
    DSW maintaining good relationships with its vendors;
 
    
    DSWs ability to anticipate and respond to fashion trends;
 
    
    fluctuation of DSWs comparable store sales and quarterly financial performance;
 
    
    the realization of our bankruptcy claims related to liquidating Filenes Basement
and Value City;
 
    
    the impact of the disposition of Filenes Basement and of a majority interest in
Value City and the reliance on remaining subsidiaries to pay indebtedness and
intercompany service obligations;
 
    
    the risk of Value City and liquidating Filenes Basement (Refer to Item 1. Business
for definition of liquidating Filenes Basement) not paying us or their creditors, for
which Retail Ventures may have some liability;
 
    
    the risk of New Filenes Basement (Refer to Item 1. Business for definition of New
Filenes Basement) not paying obligations related to the assets it has assumed from
liquidating Filenes Basement if such obligations are subject to ongoing guarantee by
us;
 
    
    the impact of Value City and Filenes Basement on our liquidity;
 
    
    disruption of DSWs distribution operations;
 
    
    our dependence on DSW for key services;
 
    
    failure to retain our key executives or attract qualified new personnel;
 
    
    DSWs competitiveness with respect to style, price, brand availability and customer
service;
 
    
    declining general economic conditions;
 
    
    risks inherent to international trade with countries that are major manufacturers of
footwear;
  3




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
    
    the success of dsw.com;
 
    
    lease of an office facility;
 
    
    risks related to our cash and investments; and
 
    
    DSWs ability to secure a replacement credit facility upon the expiration of its
existing credit facility.
   4




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ITEM 1. BUSINESS.
 History of Our Business
         5




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General
 DSW.
 Corporate.
   6




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DSW
 Competitive Strengths
  The Breadth of DSWs Product Offerings
  Distinctive and Convenient Store Layout
  The Value Proposition Offered to Customers
    Financial Strength
  Growth Strategy
   7




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Expanding Our Business
  Driving Sales through Enhanced Merchandising
  Investment in Infrastructure
  dsw.com
  Leased Departments
  Merchandise Suppliers and Mix
   8




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Category
    
    Fiscal 2009
    
    
    Fiscal 2008
    
    
    Fiscal 2007Womens
    
    
    66
    %
    
    
    66
    %
    
    
    65
    %Mens
    
    
    15
    %
    
    
    15
    %
    
    
    16
    %Athletic
    
    
    13
    %
    
    
    14
    %
    
    
    14
    %Accessories and Other
    
    
    6
    %
    
    
    5
    %
    
    
    5
    %
 Distribution
  Competition
  Intellectual Property
 ® ®
  Seasonality
  Management Information and Control Systems
   9




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Associates
   Available Information
   10




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ITEM 1A. RISK FACTORS.
  Introductory Note
  Risk Factors Relating to DSW
 DSW plans to open approximately ten stores in fiscal 2010 and is currently evaluating its strategy
for fiscal 2011 and beyond, which could strain its resources and have a material adverse effect on
its business and financial performance.
  DSW may be unable to open all the stores contemplated by its growth strategy on a timely basis, and
new stores it opens may not be profitable or may have an adverse impact on the profitability of
existing stores, either of which could have a material adverse effect on its business, financial
condition and results of operations.
  
    
    identify suitable markets and sites for new store locations with financially stable
co-tenants and landlords;
 
    
    negotiate favorable lease terms;
 
    
    build-out or refurbish sites on a timely and effective basis;
 
    
    obtain sufficient levels of inventory to meet the needs of new stores;
 
    
    obtain sufficient financing and capital resources or generate sufficient operating cash
flows from operations to fund growth;
 
    
    open new stores at costs not significantly greater than those anticipated;
 
    
    successfully open new DSW stores in markets in which DSW currently has few or no stores;
 
    
    control the costs of other capital investments associated with store openings;
 
    
    hire, train and retain qualified managers and store personnel; and
 
    
    successfully integrate new stores into DSWs existing infrastructure, operations,
management and distribution systems or adapt such infrastructure, operations and systems to
accommodate DSWs growth.
  11




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DSW has entered into Supply Agreements with Stein Mart, Gordmans and Filenes Basement. If Stein
Mart, Gordmans or Filenes Basement were to terminate DSWs supply agreements, close a significant
number of stores or liquidate, it could have a material adverse effect on DSWs business and
financial performance.
   DSW launched dsw.com in fiscal 2008, which may not be successful and could adversely affect DSWs
results of operations or distract management from DSWs core business.
  DSW relies on its good relationships with vendors to purchase better-branded merchandise at
favorable prices. If these relationships were to be impaired, DSW may not be able to obtain a
sufficient assortment of merchandise at attractive prices, and DSW may not be able to respond
promptly to changing fashion trends, either of which could have a material adverse effect on DSWs
competitive position, its business and financial performance.
    12




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DSW may be unable to anticipate and respond to fashion trends and consumer preferences in the
markets in which it operates, which could have a material adverse effect on DSWs business,
financial condition and results of operations.
  
    
    variations in local economic conditions, which could affect DSWs customers
discretionary spending and their price sensitivity;
 
    
    unanticipated fashion trends;
 
    
    DSWs success in developing and maintaining vendor relationships that provide DSW access
to in-season merchandise at attractive prices;
 
    
    DSWs success in distributing merchandise to DSW stores in an efficient manner; and
 
    
    changes in weather patterns, which in turn affect consumer preferences.
  DSWs operations are affected by seasonal variability.
  DSWs sales and quarterly financial performance may fluctuate for a variety of reasons, which could
result in a decline in the price of DSWs Class A Common Shares.
  
    
    challenging U.S. economic conditions and, in particular, the retail sales environment;
    
    changes in DSWs merchandising strategy;
    
    timing and concentration of new DSW store openings and related new store and other
start-up costs;
    
    levels of new store expenses associated with new DSW stores;
    
    changes in DSWs merchandise mix;
    
    changes in and regional variations in demographic and population characteristics;
    
    timing of promotional events;
    
    seasonal fluctuations due to weather conditions; and
    
    actions by DSWs competitors.
  13




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DSW is reliant on its information systems and the loss or disruption of services could affect DSWs
ability to implement its growth strategy and have a material adverse effect on DSWs business.
   The loss or disruption of DSWs distribution and fulfillment centers could have a material adverse
effect on DSWs business and operations.
   DSWs failure to retain its existing senior management team and to continue to attract qualified
new personnel could adversely affect DSWs business.
  DSW may be unable to compete favorably in its highly competitive market.
   14




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DSW is dependent on its DSW Rewards program to drive traffic, sales and loyalty.
  The current slowdown in the United States economy has adversely affected consumer confidence and
consumer spending habits.
      15




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DSW relies on foreign sources for its merchandise, and DSWs business is therefore subject to risks
associated with international trade.
  
    
    economic and political instability in countries where these suppliers are located;
    
    international hostilities or acts of war or terrorism affecting the United States or
foreign countries from which DSWs merchandise is sourced;
    
    increases in shipping costs;
    
    transportation delays and interruptions, including increased inspections of import
shipments by domestic authorities;
    
    work stoppages;
    
    adverse fluctuations in currency exchange rates;
    
    U.S. laws affecting the importation of goods, including duties, tariffs and quotas and
other non-tariff barriers;
    
    expropriation or nationalization;
    
    changes in local government administration and governmental policies;
    
    changes in import duties or quotas;
    
    compliance with trade and foreign tax laws; and
    
    local business practices, including compliance with local laws and with domestic and
international labor standards.
  Restrictions in DSWs secured revolving credit facility could limit DSWs operational flexibility.
   16




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DSW may be unable to secure a replacement credit facility upon the termination of its existing
credit facility in July 2010 or the terms of a new replacement credit facility could be materially
different than the terms it has today.
  The investment of DSWs cash and short-term investments are subject to risks that could affect the
liquidity of these investments.
    Risk Factors Relating to Our Discontinued Operations
 RVI has entered into a settlement agreement with liquidating Filenes Basement addressing certain
claims and providing for RVIs assumption of the liquidating Filenes Basement defined benefit
pension plan.
    17




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Value City Department Stores has filed for bankruptcy protection and closed its remaining stores.
Value City owes us approximately $7.3 million as of January 30, 2010 and there is substantial doubt
that we will be able to collect any significant portion of this amount.
   Retail Ventures is subject to various risks associated with the Value City bankruptcy proceedings.
    18




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Certain Other Risk Factors Relating to RVI
 Retail Ventures is a holding company and has generally relied on its subsidiaries to make payments
on its indebtedness and meet its obligations.
    We could have significant liquidity issues at the RVI level which may require us to issue
additional debt or equity or to sell assets, and there can be no assurance that such transactions
can be completed on favorable terms or that such transactions would satisfy all of RVIs liquidity
requirements.
   19




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A sale of equity by RVI to seek to address our significant liquidity issues would dilute existing
shareholders, which dilution could be increased by certain anti-dilution protections under existing
warrants issued by RVI.
   We may be unable to quickly monetize our investment in DSW Common Shares.
   Our ability to use net operating loss carryforwards to reduce future tax payments may be limited if
there is a change in ownership of Retail Ventures.
   20




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Our stock price may fluctuate significantly.
  
    
    developments related to DSW and fluctuations in the market price of DSW shares;
    
    continuing issues relating to Value City and Filenes Basement;
    
    transactions entered into to enhance liquidity at Retail Ventures;
    
    quarterly variations in actual or anticipated operating results;
    
    changes by securities analysts in estimates regarding Retail Ventures;
    
    conditions in the retail industry;
    
    the condition of the stock market; and
    
    general economic conditions.
 SSC and/or its affiliates may compete directly against us.
  Retail Ventures continues to be dependent on DSW to provide us with key services for our business.
  We are controlled by SSC and its affiliates, whose interests may differ from our other
shareholders.
   21




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Some of our directors and officers also serve as directors or officers of DSW, or may have
conflicts of interest because they may own DSW Common Shares or options to purchase DSW Common
Shares, or they may receive cash-based or equity-based awards based on the performance of DSW.
  Risk Factors Relating to Our PIES
 PIES holders bear the full risk of a decline in the market price of the DSW Class A Common Shares
between the pricing date for the PIES and the exchange date.
  The opportunity for equity appreciation provided by an investment in the PIES is less than that
provided by a direct investment in DSW Class A Common Shares.
    22




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The market price of the DSW Class A Common Shares, which may fluctuate significantly, may adversely
affect the market price of the PIES.
  
    
    developments related to DSW;
    
    quarterly variations in DSWs actual or anticipated operating results;
    
    changes by securities analysts in estimates regarding DSW;
    
    conditions in the retail industry;
    
    the condition of the stock market;
    
    general economic conditions; and
    
    sales of DSWs Common Shares by its existing shareholders, including Retail
Ventures, or holders of rights to purchase DSW Common Shares.
  The PIES may adversely affect the market price for DSW Class A Common Shares.
  The adjustments to the exchange ratio do not cover all the events that could adversely affect the
market price of the DSW Class A Common Shares.
   23




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PIES holders have no rights with respect to DSW Class A Common Shares, but may be negatively
affected by some changes made with respect to DSW Class A Common Shares.
  Our obligations under the PIES are effectively junior to our other existing and future secured debt
to the extent of the value of the assets securing that debt and effectively subordinate to the debt
and other liabilities of our subsidiaries.
  The tax consequences of an investment in the PIES are uncertain.
   Settling the PIES with DSW Class A Common Shares may result in a material amount of taxable income
to Retail Ventures.
   24




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In the event of our bankruptcy, the principal amount of the PIES would not represent a debt claim
against us.
  DSW has no obligations with respect to the PIES and does not have to consider PIES holders
interests for any reason.
  PIES holders should carefully consider the risk factors relating to DSW.
  In the event that we or certain of our subsidiaries commence any proceeding seeking liquidation,
reorganization or similar relief under any bankruptcy law, we may suffer material adverse effects
on our business as a result of the acceleration of our obligations under the PIES.
  
 ITEM 1B. UNRESOLVED STAFF COMMENTS.
   25




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ITEM 2. PROPERTIES.
  Alabama
    
    
    2Arizona
    
    
    6Arkansas
    
    
    1California
    
    
    31Colorado
    
    
    10Connecticut
    
    
    3Delaware
    
    
    1Florida
    
    
    22Georgia
    
    
    14Illinois
    
    
    15Indiana
    
    
    7Iowa
    
    
    1Kansas
    
    
    2Kentucky
    
    
    3Louisiana
    
    
    2Maine
    
    
    1Maryland
    
    
    10Massachusetts
    
    
    12Michigan
    
    
    14Minnesota
    
    
    8Mississippi
    
    
    1Missouri
    
    
    4Nebraska
    
    
    2Nevada
    
    
    3New Hampshire
    
    
    1New Jersey
    
    
    10New York
    
    
    18North Carolina
    
    
    6Ohio
    
    
    14Oklahoma
    
    
    2Oregon
    
    
    3Pennsylvania
    
    
    15Rhode Island
    
    
    1Tennessee
    
    
    5Texas
    
    
    30Utah
    
    
    3Virginia
    
    
    13Washington
    
    
    5Wisconsin
    
    
    4Total
    
    
    305
   
 ITEM 3. LEGAL PROCEEDINGS.
  
 ITEM 4. RESERVED.
  26




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PART II
 
 ITEM 5. MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES.
  High
    
    
    LowFiscal 2008:First Quarter
    
    $
    7.46
    
    
    $
    3.77Second Quarter
    
    
    5.58
    
    
    
    3.29Third Quarter
    
    
    5.17
    
    
    
    1.35Fourth Quarter
    
    
    3.53
    
    
    
    0.90Fiscal 2009:First Quarter
    
    $
    2.98
    
    
    $
    1.45Second Quarter
    
    
    3.68
    
    
    
    2.14Third Quarter
    
    
    7.43
    
    
    
    3.10Fourth Quarter
    
    
    9.66
    
    
    
    5.94
     27




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PERFORMANCE GRAPH
  
  Company / Index
    
    1/29/05
    
    
    1/28/06
    
    
    2/3/07
    
    
    2/2/08
    
    
    1/31/09
    
    
    1/30/10RETAIL VENTURES, INC.
    
    $
    100.00
    
    
    $
    192.59
    
    
    $
    305.45
    
    
    $
    107.41
    
    
    $
    36.16
    
    
    $
    125.26RUSSELL 2000
    
    $
    100.00
    
    
    $
    120.86
    
    
    $
    135.19
    
    
    $
    123.50
    
    
    $
    76.16
    
    
    $
    104.96S&P 500 GENERAL
MERCHANDISE STORES
    
    $
    100.00
    
    
    $
    104.37
    
    
    $
    122.77
    
    
    $
    111.53
    
    
    $
    67.71
    
    
    $
    109.33S&P
MIDCAP 400 INDEX
    
    $
    100.00
    
    
    $
    123.18
    
    
    $
    135.57
    
    
    $
    134.06
    
    
    $
    82.57
    
    
    $
    118.37S&P 500 RETAILING INDEX
    
    $
    100.00
    
    
    $
    108.79
    
    
    $
    125.23
    
    
    $
    102.21
    
    
    $
    63.66
    
    
    $
    99.02
  28




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ITEM 6. SELECTED FINANCIAL DATA.
  For the Fiscal Year Ended(1)January 30,
    
    
    January 31,
    
    
    February 2,
    
    
    February 3,
    
    
    January 28,2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006(dollars in thousands, except per share amounts and net sales per selling square foot)Net sales
    
    $
    1,602,605
    
    
    $
    1,462,944
    
    
    $
    1,405,615
    
    
    $
    1,279,060
    
    
    $
    1,144,061Gross profit
    
    $
    712,140
    
    
    $
    621,351
    
    
    $
    583,768
    
    
    $
    550,699
    
    
    $
    484,833Operating profit before change in fair value of
derivative instruments(2)
    
    $
    26,655
    
    
    $
    42,813
    
    
    $
    81,321
    
    
    $
    100,714
    
    
    $
    70,112Change in fair value of derivative instruments
    
    $
    (66,499
    )
    
    $
    85,235
    
    
    $
    248,193
    
    
    $
    (175,955
    )
    
    $
    (144,209
    )Operating (loss) profit
    
    $
    (39,844
    )
    
    $
    128,048
    
    
    $
    329,514
    
    
    $
    (75,241
    )
    
    $
    (74,097
    )(Loss) income from continuing operations
    
    $
    (65,610
    )
    
    $
    109,180
    
    
    $
    261,846
    
    
    $
    (98,714
    )
    
    $
    (109,215
    )Income (loss) from discontinued operations, net of tax
    
    $
    59,880
    
    
    $
    (48,379
    )
    
    $
    (190,525
    )
    
    $
    (28,033
    )
    
    $
    (67,202
    )Net (loss) income attributable to Retail Ventures, Inc.
    
    $
    (26,091
    )
    
    $
    50,841
    
    
    $
    51,442
    
    
    $
    (150,913
    )
    
    $
    (183,418
    )Basic (loss) earnings per share from continuing
operations attributable to Retail Ventures, Inc. common
shareholders
    
    $
    (1.76
    )
    
    $
    2.04
    
    
    $
    5.02
    
    
    $
    (2.73
    )
    
    $
    (3.01
    )Diluted (loss) earnings per share from continuing
operations attributable to Retail Ventures, Inc. common
shareholders
    
    $
    (1.76
    )
    
    $
    2.00
    
    
    $
    4.26
    
    
    $
    (2.73
    )
    
    $
    (3.01
    )Basic earnings (loss) per share from discontinued
operations attributable to Retail Ventures, Inc. common
shareholders
    
    $
    1.23
    
    
    $
    (0.99
    )
    
    $
    (3.96
    )
    
    $
    (0.62
    )
    
    $
    (1.74
    )Diluted earnings (loss) per share from discontinued
operations attributable to Retail Ventures, Inc. common
shareholders
    
    $
    1.23
    
    
    $
    (0.98
    )
    
    $
    (3.35
    )
    
    $
    (0.62
    )
    
    $
    (1.74
    )Basic (loss) earnings per share attributable to Retail
Ventures, Inc. common shareholders
    
    $
    (0.53
    )
    
    $
    1.04
    
    
    $
    1.07
    
    
    $
    (3.35
    )
    
    $
    (4.75
    )Diluted (loss) earnings per share attributable to Retail
Ventures, Inc. common shareholders
    
    $
    (0.53
    )
    
    $
    1.03
    
    
    $
    0.91
    
    
    $
    (3.35
    )
    
    $
    (4.75
    )Total assets
    
    $
    903,465
    
    
    $
    953,762
    
    
    $
    951,966
    
    
    $
    1,301,658
    
    
    $
    1,175,154Working capital
    
    $
    369,204
    
    
    $
    307,776
    
    
    $
    295,862
    
    
    $
    274,439
    
    
    $
    147,746Current ratio
    
    
    2.43
    
    
    
    2.20
    
    
    
    1.98
    
    
    
    1.45
    
    
    
    1.25Long-term obligations, continuing operations
    
    $
    129,757
    
    
    $
    127,576
    
    
    $
    135,293
    
    
    $
    133,053
    
    
    $
    49,678Number of DSW Stores:(3)
    
    
    305
    
    
    
    298
    
    
    
    259
    
    
    
    223
    
    
    
    199DSW net sales per average gross square foot(4)
    
    $
    203
    
    
    $
    196
    
    
    $
    212
    
    
    $
    218
    
    
    $
    217DSW comparable store sales change(5)
    
    
    3.2
    %
    
    
    (5.9
    )%
    
    
    (0.8
    )%
    
    
    2.5
    %
    
    
    5.4
    %
 
 (1)
    
    Fiscal year ended February 3, 2007 consists of 53 weeks. All other years reported
consist of 52 weeks.  29




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##### Table of Contents



(2)
    
    The Company believes that the non-cash change in fair value of derivative
instruments is not directly related to its retail operations and is therefore providing
supplemental adjusted results that exclude this item. This financial measure should facilitate
analysis by investors and others who follow the Companys financial performance.(3)
    
    Includes all DSW stores operating at the end of the fiscal year.(4)
    
    Presented in whole dollars and excludes leased departments. Average gross square
footage represents the monthly average of square feet for DSW stores only for each period
presented and consequently reflects the effect of opening stores in different months
throughout the period. Net sales per average gross square foot is the result of dividing net
sales for DSW stores only for the period presented, by average gross square footage.(5)
    
    Comparable DSW stores and comparable leased departments are those units that have
been in operation for at least 14 months at the beginning of the fiscal year. Stores or leased
departments are added to the comparable base at the beginning of the year and are dropped for
comparative purposes in the quarter that they are closed.  30




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##### Table of Contents



ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
  OVERVIEW
      31




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Key Financial Measures
  CRITICAL ACCOUNTING POLICIES
    32




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##### Table of Contents




    
    Revenue recognition. Revenues from merchandise sales are recognized upon customer receipt
of merchandise are net of returns and sales tax and are not recognized until collectability
is reasonably assured. For dsw.com, we estimate a time lag for shipments to record revenue
when the customer receives the goods. We believe a one day change in our estimate would not
materially impact our revenue. Net sales also include revenue from shipping and handling while
the related costs are included in cost of sales.Revenue from gift cards is deferred and the revenue is recognized upon redemption of the gift
card. Our policy is to recognize income from breakage of gift cards when the likelihood of
redemption of the gift card is remote. In the fourth quarter of fiscal 2007, we determined
that we had accumulated enough historical data to recognize income from gift card breakage.
Miscellaneous income is included in selling, general and administrative expenses. We
recognized $1.1 million, $0.8 million and $0.3 million as other operating income from gift
card breakage during fiscal 2009, 2008 and 2007, respectively, excluding discontinued
operations.
 
    
    Cost of sales and merchandise inventories. Merchandise inventories are stated at the net
realizable value, determined using the first-in, first-out basis, or market, using the
retail inventory method. The retail inventory method is widely used in the retail industry
due to its practicality. Under the retail inventory method, the valuation of inventories at
cost and the resulting gross margins are calculated by applying a calculated cost to retail
ratio to the retail value of inventories. The cost of the inventory reflected on the
consolidated balance sheet is decreased by charges to cost of sales at the time the retail
value of the inventory is lowered through the use of markdowns, which are reductions in
prices due to customers perception of value. Accordingly, earnings are negatively impacted
as merchandise is marked down prior to sale.
    
    
    Investments.DSWs investments are valued using a market based approach using level 1 and
2 inputs. DSWs equity investment is recorded at cost and reviewed for impairment using an
income approach valuation model that uses level 3 inputs such as the financial condition and
future prospects of the entity.
  
    
    Asset Impairment and Long-lived Assets.We must periodically evaluate the carrying amount
of our long-lived assets, primarily property and equipment, and finite life intangible
assets when events and circumstances warrant such a review to ascertain if any assets have
been impaired. The carrying amount of a long-lived asset or asset group is considered
impaired when the carrying value of the asset or asset group exceeds the expected future
cash flows from the asset. Our reviews are conducted at the lowest identifiable level, which
includes a store. The impairment loss recognized is the excess of the carrying amount of the
asset or asset group over its fair value, based on projected discounted cash flows using a
discount rate determined by management. Any impairment loss realized is generally included
in cost of sales. We believe as of January 30, 2010 that the long-lived assets carrying
amounts and useful lives are appropriate. We do not believe that there will be material
changes in the estimates or assumptions we use to calculate asset impairments. To the extent
these future projections or our strategies change, the conclusion regarding impairment may
differ from our current estimates.
  33




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##### Table of Contents




    
    Self-insurance Reserves.We record estimates for certain health and welfare, workers
compensation and casualty insurance costs that are self-insured programs. Self-insurance
reserves include actuarial estimates of both claims filed, carried at their expected
ultimate settlement value, and claims incurred but not yet reported. Our liability
represents an estimate of the ultimate cost of claims incurred as of the balance sheet date.
Health and welfare estimates are calculated utilizing claims development estimates based on
historical experience and other factors. Workers compensation and general liability
insurance estimates are calculated utilizing claims development estimates based on
historical experience and other factors. We have purchased stop loss insurance to limit our
exposure to any significant exposure on a per person basis for health and welfare and on a
per claim basis for workers compensation and casualty insurance. Although we do not
anticipate the amounts ultimately paid will differ significantly from our estimates,
self-insurance reserves could be affected if future claim experience differs significantly
from the historical trends and the actuarial assumptions. For example, for workers
compensation and liability future claims estimates, a 1% increase or decrease to the
assumptions for claims costs and loss development factors would increase or decrease our
self-insurance accrual by approximately $0.1 million.
 
    
    Pension. The obligations and related assets of the defined benefit retirement plan are
included in continuing operations at January 30, 2010 and in operations held for sale at
January 31, 2009, and are presented in Note 10 of the Notes to Consolidated Financial
Statements in this Annual Report on Form 10-K. Plan assets, which consist primarily of
marketable equity and debt instruments, are valued using market quotations. Plan obligations
and the annual pension expense are determined by independent actuaries and through the use
of a number of assumptions. Key assumptions in measuring the plan obligations include the
discount rate and the estimated future return on plan assets. In determining the discount
rate, we utilize the yield on fixed-income investments currently available with maturities
corresponding to the anticipated timing of the benefit payments. Asset returns are based
upon the anticipated average rate of earnings expected on the invested funds of the plans.
At January 30, 2010, the weighted-average actuarial assumptions applied to our plan were a
discount rate of 5.8% and long-term rate of return on plan assets of 7.0%. At January 31,
2009, the weighted-average actuarial assumptions applied to our plan were a discount rate of
6.3% and long-term rate of return on plan assets of 7.0%. To the extent actual results vary
from assumptions, earnings would be impacted.
 
    
    Customer Loyalty Program.We maintain a customer loyalty program for the DSW stores and
dsw.com in which program members earn reward certificates that result in discounts on future
purchases. Upon reaching the target-earned threshold, the members receive reward
certificates for these discounts which expire six months after being issued. We accrue the
anticipated redemptions of the discount earned at the time of the initial purchase. To
estimate these costs, we are required to make assumptions related to customer purchase
levels and redemption rates based on historical experience.
 
    
    Change in fair value of derivative instruments. In accordance with ASC 815, Derivatives
and Hedging, the Company recognizes all derivatives on the balance sheet at fair value. For
derivatives that are not designated as hedges under ASC 815, changes in the fair values are
recognized in earnings in the period of change. The Company uses the Black-Scholes Pricing
Model to calculate the fair value of derivative instruments. For fiscal years ended January
30, 2010 and January 31, 2009, the Company recorded a non-cash charge of $16.8 million and a
non-cash reduction of expense of $35.9 million, respectively, related to the change in fair
value of warrants. For fiscal years ended January 30, 2010 and January 31, 2009, the Company
recorded a non-cash charge of $49.7 million and a non-cash reduction of expense of $49.3
million, respectively, related to the change in the fair value of the conversion feature of
the PIES. At January 30, 2010, if the estimated discount rate were to have increased by 1%,
the effect on the fair value of the warrants would have been $0.1 million and would have
decreased the fair value of the conversion feature of the PIES by approximately $1.9
million.
 
    
    Income taxes. We are required to determine the aggregate amount of income tax expense to
accrue and the amount which will be currently payable based upon tax statutes of each
jurisdiction in which we do business. In making these estimates, we adjust income based on a
determination of generally accepted accounting principles for items that are treated
differently by the applicable taxing authorities. Deferred tax assets and liabilities, as a
result of these differences, are reflected on our balance sheet for temporary differences
that will reverse in subsequent years. A valuation allowance is established against deferred
tax assets when it is more likely than not that some or all of the deferred tax assets will
not be realized. If our management had made these determinations on a different basis, our
tax expense, assets and liabilities could be different. During fiscal 2009, an increase in
valuation reserve of $41.1 million for deferred tax assets was recorded. During fiscal 2008,
a decrease in valuation reserve of $22.6 million for deferred tax assets was recorded.
  
    
    Sale of subsidiary stock.Sales of stock by a subsidiary are accounted for by Retail
Ventures as capital transactions.
  34




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##### Table of Contents



RESULTS OF OPERATIONS
  Seasonality
  Fiscal Year
   Fifty-two weeks endedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Net sales
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of sales (exclusive of depreciation shown below in selling, general and
administrative expenses)
    
    
    (55.6
    )
    
    
    (57.5
    )
    
    
    (58.5
    )Selling, general and administrative expenses
    
    
    (42.8
    )
    
    
    (39.5
    )
    
    
    (35.8
    )Change in fair value of derivative instruments
    
    
    (4.1
    )
    
    
    5.8
    
    
    
    17.7Operating (loss) profit
    
    
    (2.5
    )
    
    
    8.8
    
    
    
    23.4Interest expense
    
    
    (0.8
    )
    
    
    (0.9
    )
    
    
    (1.0
    )Interest income
    
    
    0.1
    
    
    
    0.7
    
    
    
    1.3Interest (expense) income, net
    
    
    (0.7
    )
    
    
    (0.2
    )
    
    
    0.3Non-operating (expense), net
    
    
    (0.2
    )(Loss) income from continuing operations before income taxes
    
    
    (3.4
    )
    
    
    8.6
    
    
    
    23.7Income tax expense
    
    
    (0.7
    )
    
    
    (1.1
    )
    
    
    (5.1
    )Net (loss) income from continuing operations
    
    
    (4.1
    )
    
    
    7.5
    
    
    
    18.6Less: net income attributable to the noncontrolling interests
    
    
    (1.3
    )
    
    
    (0.7
    )
    
    
    (1.4
    )Net (loss) income from continuing operations attributable to Retail Ventures, Inc.
    
    
    (5.4
    )%
    
    
    6.8
    %
    
    
    17.2
    %
  35




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##### Table of Contents



Fiscal Year Ended January 30, 2010 (fiscal 2009) Compared To Fiscal Year Ended January 31, 2009
(fiscal 2008)
 Sales.
 For the fiscalyear endedJanuary 30,2010Net sales for the fiscal year ended January 31, 2009
    
    $
    1,462.9Increase in comparable store sales
    
    
    42.8Net increase in 2008 and 2009 new stores, dsw.com and closed store sales
    
    
    96.9Net sales for the fiscal year ended January 30, 2010
    
    $
    1,602.6
  Gross Profit.
 Selling, General and Administrative Expenses.
   Change in Fair Value of Derivatives.
 Operating (Loss) Profit.
   36




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##### Table of Contents



Interest Expense.
 Interest Income.
 Non-operating (Expense) Income, Net.
 Income Taxes.
 (Loss) Income from Continuing Operations.
 Income (Loss) from Discontinued Operations  Value City Department Stores.
 Income (Loss) from Discontinued Operations  Filenes Basement.
 Noncontrolling interests.
 Fiscal Year Ended January 31, 2009 (fiscal 2008) Compared To Fiscal Year Ended February 2, 2008
(fiscal 2007)
 Sales.
 For the fiscalyear endedJanuary 31,2009Net sales for the fiscal year ended February 2, 2008
    
    $
    1,405.6Decrease in comparable store sales
    
    
    (74.6
    )Net increase in 2007 and 2008 new stores, dsw.com and closed store sales
    
    
    131.9Net sales for the fiscal year ended January 31, 2009
    
    $
    1,462.9
   37




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##### Table of Contents



Gross Profit.
 Selling, General and Administrative Expenses.
  Change in Fair Value of Derivatives.
 Operating (Loss) Profit.
   Interest Expense.
 Interest Income.
 Non-operating (Expense) Income, Net.
 Income Taxes.
 Loss (Income) from Continuing Operations.
 Income (Loss) from Discontinued Operations  Value City Department Stores.
  38




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##### Table of Contents



Income (Loss) from Discontinued Operations  Filenes Basement.
 Noncontrolling Interests.
 Inflation and Deflation
  Liquidity and Capital Resources
       39




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##### Table of Contents



Operating Activities
   Investing Activities
     Financing Activities
   40




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##### Table of Contents



$150 Million Secured Revolving Credit Facility  The DSW Revolving Loan
   $143,750,000 Premium Income Exchangeable Securities SM (PIES)
      41




---



##### Table of Contents



Warrants
   Liquidity and Capital Resources Considerations Relating to the Value City Disposition
     42




---



##### Table of Contents



Liquidity and Capital Resources Considerations Relating to the Filenes Basement Disposition
    Certain Liquidity Issues of RVI
     43




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##### Table of Contents



Contractual Obligations
   Less Than
    
    
    1 - 3
    
    
    3 - 5
    
    
    More ThanContractual
Obligations(7)
    
    Total
    
    
    1 Year
    
    
    Years
    
    
    Years
    
    
    5 YearsContinuing Operations:Long-term debt
    
    $
    133,750
    
    
    
    
    
    
    $
    133,750Interest payments on long-term debt (1)
    
    
    15,507
    
    
    $
    8,861
    
    
    
    6,646Operating lease obligations (2)
    
    
    915,200
    
    
    
    132,916
    
    
    
    247,212
    
    
    $
    216,536
    
    
    $
    318,536Construction commitments  DSW (3)
    
    
    653
    
    
    
    653Pension (4)
    
    
    5,313
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,313Other (5)
    
    
    7,178
    
    
    
    4,786
    
    
    
    1,741
    
    
    
    50
    
    
    
    601Uncertain tax positions (6)
    
    
    10,932
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,932Total continuing operations
    
    $
    1,088,533
    
    
    $
    147,216
    
    
    $
    389,349
    
    
    $
    216,586
    
    
    $
    335,382
 (1)
    
    Projected interest payments are for the PIES and Non-Convertible Loan and are based
on the outstanding principal amount at January 30, 2010 and interest rate per the agreement.(2)
    
    Many of our operating leases require us to pay contingent rent based on sales,
common area maintenance and real estate taxes. Contingent rent, costs and taxes vary year by
year and are based almost entirely on actual costs incurred. As such, they are not included in
the lease obligations presented above. Other non current liabilities of $110.0 million are
primarily comprised of deferred rent liabilities, construction and tenant allowances, and
uncertain tax positions. Deferred rent, which is included in other non current liabilities, is
excluded from this table as our payment obligations are included in the operating lease
obligations. Construction and tenant allowances, which are included in other non current
liabilities, are not contractual obligations as the balance represents cash allowances from
landlords, which are deferred and amortized on a straight-line basis over the original terms
of the lease.(3)
    
    Construction commitments include capital items to be purchased for projects that
were under construction, or for which a lease had been signed, as of January 30, 2010.(4)
    
    Pension is included in the More Than 5 Years column as we are not able to
reasonably estimate the timing of the potential future payments.(5)
    
    Other contractual obligations include purchase commitments, guarantees and
indemnifications. Many of our purchase commitments are cancelable by us without payment or
penalty, and we have excluded such commitments, along with all associate employment and
intercompany commitments.(6)
    
    The amount of obligations related to uncertain tax positions as of January 30,
2010, is $10.9 million, including approximately $1.9 million of accrued interest and
penalties. Uncertain tax benefits are positions taken or expected to be taken on an income tax
return that may result in additional payments to tax authorities. We may not be required to
settle these obligations. Uncertain tax positions are included in the More Than 5 Years
column as we are not able to reasonably estimate the timing of the potential future payments.(7)
    
    Deferred taxes,
noncontrolling interest and payments on RVI restricted stock units are not included in this table.    44




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##### Table of Contents



Recent Accounting Pronouncements
  Off-Balance Sheet Arrangements
   45




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##### Table of Contents



ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
  Investments
 ®
 Secured Revolving Credit Facilities
  Warrants
 VCHI Acquisition Co. Warrants
  Derivatives and Hedging, Contracts in Entitys Own Equit
 Warrants
 Derivatives and Hedging
    46




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##### Table of Contents



Conversion Feature of PIES
  
 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
  
 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
  
 ITEM 9A. CONTROLS AND PROCEDURES.
 Evaluation of Disclosure Controls and Procedures
  Managements Report on Internal Control over Financial Reporting
    Changes in Internal Control over Financial Reporting
  
 ITEM 9B. OTHER INFORMATION.
   47




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##### Table of Contents



PART III
 
 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
 EXECUTIVE OFFICERS, ELECTION OF DIRECTORS OTHER DIRECTOR INFORMATION, COMMITTEES OF
DIRECTORS AND CORPORATE GOVERNANCE INFORMATION
 
 ITEM 11. EXECUTIVE COMPENSATION.
 COMPENSATION OF MANAGEMENT OTHER DIRECTOR INFORMATION COMMITTEES OF DIRECTORS AND CORPORATE
GOVERNANCE INFORMATION  GENERAL
 
 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER
MATTERS.
 SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS and EQUITY
COMPENSATION PLAN INFORMATION
 EQUITY COMPENSATION PLAN TABLE
  Number of securitiesremaining available forNumber of securities to
    
    
    Weighted-average
    
    
    issuance under equitybe issued upon exercise of
    
    
    exercise price of
    
    
    compensation plansoutstanding options,
    
    
    outstanding options,
    
    
    (excluding securitiesPlan Category
    
    warrants and rights
    
    
    warrants and rights
    
    
    reflected in column (a))(a)
    
    
    (b)
    
    
    (c)Equity compensation
plans approved by
security holders
(1)
    
    
    1,003,150
    
    
    $
    7.56
    
    
    
    4,678,743Equity compensation
plans not approved
by security holders
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/ATotal
    
    
    1,003,150
    
    
    $
    7.56
    
    
    
    4,678,743
 (1)
    
    Equity compensation plans approved by shareholders include the 1991 Plan and the 2000
Plan.  48




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##### Table of Contents



ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE.
 CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS and OTHER DIRECTOR INFORMATION, COMMITTEES
OF DIRECTORS
AND CORPORATE GOVERNANCE INFORMATION - CORPORATE GOVERNANCE
PRINCIPLES
 
 ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.
 AUDIT AND
OTHER SERVICE FEES
  49




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##### Table of Contents



PART IV
 
 ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
 Page inForm 10-K15(a)(1) Financial StatementsThe documents listed below are filed as part of this Form 10-K:Report of Independent Registered Public Accounting Firm
    
    
    F-1Consolidated Balance Sheets at January 30, 2010 and January 31, 2009
    
    
    F-3Consolidated Statements of Operations for the years ended January
30, 2010, January 31, 2009 and February 2, 2008
    
    
    F-5Consolidated Statements of Shareholders Equity for the years ended
January 30, 2010, January 31, 2009 and February 2, 2008
    
    
    F-7Consolidated Statements of Cash Flows for the years ended January
30, 2010, January 31, 2009 and February 2, 2008
    
    
    F-9Notes to Consolidated Financial Statements
    
    
    F-1115(a)(2) Consolidated Financial Statement Schedules:Schedule I:Condensed Balanced Sheets (Parent Company Only) at January 30,
2010 and January 31, 2009
    
    
    S-1Condensed Statements of Operations (Parent Company Only) for
the years ended January 30, 2010, January 31, 2009 and
February 2, 2008
    
    
    S-4Condensed Statements of Cash Flows (Parent Company Only) for
the years ended January 30, 2010, January 31, 2009 and
February 2, 2008
    
    
    S-5Schedules not filed are omitted because of the absence of the conditions under which they are
required or because the required information is included in the financial statements or the notes
thereto.15(a)(3) and (b) Exhibits:Index to Exhibits
    
    
    E-1
 15(c) Additional Financial Statement Schedules:
   50




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##### Table of Contents



SIGNATURES
  RETAIL VENTURES, INC.April 14, 2010
    By:
    /s/ James A. McGradyJames A. McGrady, Chief Executive Officer,President, Chief Financial Officer and Treasurer
(Principal Executive Officer and Principal Financial
and Accounting Officer)  Signature
    
    Title
    
    Date*

Jay L. Schottenstein
    
    Chairman of the Board of Directors
    
    April 14, 2010/s/ James A. McGrady

James A. McGrady
    
    Chief Executive Officer, President,
 Chief Financial Officerand Treasurer (Principal Executive Officer and
Principal Financial and Accounting Officer)
    
    April 14, 2010*

Henry L. Aaron
    
    Director
    
    April 14, 2010*

Ari Deshe
    
    Director
    
    April 14, 2010*

Jon P. Diamond
    
    Director
    
    April 14, 2010*

Elizabeth M. Eveillard
    
    Director
    
    April 14, 2010*

Lawrence J. Ring
    
    Director
    
    April 14, 2010*

Harvey L. Sonnenberg
    
    Director
    
    April 14, 2010*

James L. Weisman
    
    Director
    
    April 14, 2010
 *By:
    
    /s/ James A. McGrady

James A. McGrady (Attorney-in-fact)
  51




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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
     Internal Control  Integrated Framework
  
  F-1




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##### Table of Contents



Internal Control  Integrated Framework
    Internal Control  Integrated Framework
   
  F-2




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##### Table of Contents



RETAIL VENTURES, INC.
 
 CONSOLIDATED BALANCE SHEETS
 January 30, 2010 and January 31, 2009
 (in thousands, except share amounts)
 January 30,
    
    
    January 31,2010
    
    
    2009ASSETSCash and equivalents
    
    $
    141,773
    
    
    $
    94,308Restricted cash
    
    
    
    
    
    
    261Short-term investments, net
    
    
    164,265
    
    
    
    101,404Accounts receivable, net
    
    
    6,509
    
    
    
    7,142Accounts receivable from related parties
    
    
    154
    
    
    
    332Inventories
    
    
    262,284
    
    
    
    244,008Prepaid expenses and other current assets
    
    
    22,478
    
    
    
    27,249Deferred income taxes
    
    
    29,560
    
    
    
    22,243Current assets held for sale
    
    
    
    
    
    
    66,678Total current assets
    
    
    627,023
    
    
    
    563,625Property and equipment, at cost:Furniture, fixtures and equipment
    
    
    235,728
    
    
    
    233,616Leasehold improvements
    
    
    162,840
    
    
    
    158,294398,568
    
    
    
    391,910Accumulated depreciation and amortization
    
    
    (189,755
    )
    
    
    (155,555
    )Property and equipment, net
    
    
    208,813
    
    
    
    236,355Goodwill
    
    
    25,899
    
    
    
    25,899Conversion feature of long-term debt
    
    
    28,029
    
    
    
    77,761Deferred income taxes
    
    
    5,657
    
    
    
    805Other assets
    
    
    8,044
    
    
    
    10,524Non current assets held for sale
    
    
    
    
    
    
    38,793Total assets
    
    $
    903,465
    
    
    $
    953,762
   F-3




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##### Table of Contents



RETAIL VENTURES, INC.
CONSOLIDATED BALANCE SHEETS (Continued)
January 30, 2010 and January 31, 2009
(in thousands, except share amounts)
 January 30,
    
    
    January 31,2010
    
    
    2009LIABILITIES AND SHAREHOLDERS EQUITYAccounts payable
    
    $
    120,038
    
    
    $
    93,088Accounts payable to related parties
    
    
    1,239
    
    
    
    3,125Accrued expenses:Compensation
    
    
    27,056
    
    
    
    12,632Taxes
    
    
    29,682
    
    
    
    14,857Gift cards and merchandise credits
    
    
    17,774
    
    
    
    15,491Guarantees from discontinued operations
    
    
    2,800
    
    
    
    2,909Other
    
    
    36,162
    
    
    
    31,175Warrant liability
    
    
    23,068
    
    
    
    6,292Current maturities of long-term debt
    
    
    
    
    
    
    250Current liabilities held for sale
    
    
    
    
    
    
    76,030Total current liabilities
    
    
    257,819
    
    
    
    255,849Long-term obligations, net of current maturities
    
    
    129,757
    
    
    
    127,576Other non current liabilities
    
    
    109,958
    
    
    
    109,290Deferred income taxes
    
    
    2,641
    
    
    
    29,806Non current liabilities held for sale
    
    
    
    
    
    
    36,055Commitments and contingenciesShareholders equity:Common Shares, without par value; 160,000,000
authorized; issued and outstanding, including
7,551 treasury shares, 48,964,530 and 48,691,280
outstanding, respectively
    
    
    313,147
    
    
    
    306,868Accumulated deficit
    
    
    (100,277
    )
    
    
    (76,930
    )Treasury shares, at cost, 7,551 shares
    
    
    (59
    )
    
    
    (59
    )Warrants
    
    
    
    
    
    
    124Accumulated other comprehensive loss
    
    
    (6,942
    )
    
    
    (655
    )Accumulated other comprehensive loss held for sale
    
    
    
    
    
    
    (6,734
    )Total Retail Ventures shareholders equity
    
    
    205,869
    
    
    
    222,614Noncontrolling interests
    
    
    197,421
    
    
    
    172,572Total shareholders equity
    
    
    403,290
    
    
    
    395,186Total liabilities and shareholders equity
    
    $
    903,465
    
    
    $
    953,762
   F-4




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##### Table of Contents



RETAIL VENTURES, INC.
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 Years Ended January 30, 2010, January 31, 2009 and February 2, 2008
 (in thousands, except per share amounts)
 January 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Net sales
    
    $
    1,602,605
    
    
    $
    1,462,944
    
    
    $
    1,405,615Cost of sales (exclusive of depreciation included below in selling,
general and administrative expenses)
    
    
    (890,465
    )
    
    
    (841,593
    )
    
    
    (821,847
    )Selling, general and administrative expenses
    
    
    (685,485
    )
    
    
    (578,538
    )
    
    
    (502,447
    )Change in fair value of derivative instruments
    
    
    (66,499
    )
    
    
    85,235
    
    
    
    248,193Operating (loss) profit
    
    
    (39,844
    )
    
    
    128,048
    
    
    
    329,514Interest expense
    
    
    (13,632
    )
    
    
    (13,603
    )
    
    
    (13,896
    )Interest income
    
    
    2,288
    
    
    
    11,269
    
    
    
    18,631Interest (expense) income, net
    
    
    (11,344
    )
    
    
    (2,334
    )
    
    
    4,735Non-operating (expense) income, net
    
    
    (2,367
    )
    
    
    352(Loss) income from continuing operations before income taxes
    
    
    (53,555
    )
    
    
    126,066
    
    
    
    334,249Income tax expense
    
    
    (12,055
    )
    
    
    (16,886
    )
    
    
    (72,403
    )(Loss) income from continuing operations
    
    
    (65,610
    )
    
    
    109,180
    
    
    
    261,846Income (loss) from discontinued operations, net of tax  Value City
    
    
    9,513
    
    
    
    13,223
    
    
    
    (150,662
    )Income (loss) from discontinued operations, net of tax  Filenes Basement
    
    
    50,367
    
    
    
    (61,602
    )
    
    
    (39,863
    )Total income (loss) from discontinued operations, net of tax
    
    
    59,880
    
    
    
    (48,379
    )
    
    
    (190,525
    )Net (loss) income
    
    
    (5,730
    )
    
    
    60,801
    
    
    
    71,321Less: net income attributable to the noncontrolling interests
    
    
    (20,361
    )
    
    
    (9,960
    )
    
    
    (19,879
    )Net (loss) income attributable to Retail Ventures, Inc.
    
    $
    (26,091
    )
    
    $
    50,841
    
    
    $
    51,442
  F-5




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##### Table of Contents



RETAIL VENTURES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (Continued)
Years Ended January 30, 2010, January 31, 2009 and February 2, 2008
(in thousands, except per share amounts)
 January 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Basic and diluted (loss) earnings per share:Basic (loss) earnings per share from continuing operations
attributable to Retail Ventures, Inc. common shareholders
    
    $
    (1.76
    )
    
    $
    2.04
    
    
    $
    5.02Diluted (loss) earnings per share from continuing operations
attributable to Retail Ventures, Inc. common shareholders
    
    $
    (1.76
    )
    
    $
    2.00
    
    
    $
    4.26Basic earnings (loss) per share from discontinued operations
attributable to Retail Ventures, Inc. common shareholders
    
    $
    1.23
    
    
    $
    (0.99
    )
    
    $
    (3.96
    )Diluted earnings (loss) per share from discontinued operations
attributable to Retail Ventures, Inc. common shareholders
    
    $
    1.23
    
    
    $
    (0.98
    )
    
    $
    (3.35
    )Basic (loss) earnings per share attributable to Retail Ventures,
Inc. common shareholders
    
    $
    (0.53
    )
    
    $
    1.04
    
    
    $
    1.07Diluted (loss) earnings per share attributable to Retail
Ventures, Inc. common shareholders
    
    $
    (0.53
    )
    
    $
    1.03
    
    
    $
    0.91Shares used in per share calculations:Basic shares
    
    
    48,878
    
    
    
    48,669
    
    
    
    48,165Diluted shares
    
    
    48,878
    
    
    
    49,526
    
    
    
    56,794Amounts attributable to Retail Ventures, Inc. common shareholders:(Loss) income from continuing operations, net of tax
    
    $
    (85,971
    )
    
    $
    99,220
    
    
    $
    241,967Discontinued operations, net of tax
    
    
    59,880
    
    
    
    (48,379
    )
    
    
    (190,525
    )Net (loss) income
    
    $
    (26,091
    )
    
    $
    50,841
    
    
    $
    51,442
   F-6




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##### Table of Contents



RETAIL VENTURES, INC.
 
 CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY
 Years Ended January 30, 2010, January 31, 2009 and February 2, 2008
 (in thousands)
 Number of Shares
    
    
    Retail Ventures, Inc. ShareholdersRetained
    
    
    
    
    
    
    
    
    
    
    TotalCommon
    
    
    Earnings
    
    
    
    
    
    
    
    
    
    
    AccumulatedCommon
    
    
    Shares and
    
    
    (Accum-
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    Non-Common
    
    
    Shares in
    
    
    Paid in
    
    
    ulated
    
    
    
    
    
    
    Treasury
    
    
    Comprehen-
    
    
    controllingShares
    
    
    Treasury
    
    
    Capital
    
    
    Deficit)
    
    
    Warrants
    
    
    Shares
    
    
    sive Loss
    
    
    Interests
    
    
    TotalBalance, February 3, 2007
    
    
    47,271
    
    
    
    8
    
    
    $
    276,690
    
    
    $
    (184,461
    )
    
    $
    
    
    
    $
    (59
    )
    
    $
    (550
    )
    
    $
    138,428
    
    
    $
    230,048Income from continuing
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    241,967
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,879
    
    
    
    261,846Loss from discontinued
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (190,525
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (190,525
    )Change in minimum pension
liability, net of income
tax expense of $1,004
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,269
    )
    
    
    
    
    
    
    (1,269
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    70,052Capital transactions of
subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,083
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,042
    
    
    
    5,125Cumulative effect of FIN
48 adoption for
discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (641
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (641
    )Reclassification of stock
appreciation rights
    
    
    
    
    
    
    
    
    
    
    1,934
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,934Stock based compensation
expense, before related
tax effects
    
    
    
    
    
    
    
    
    
    
    947
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    947Exercise of stock options
    
    
    19
    
    
    
    
    
    
    
    71
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    71Exercise of warrants
    
    
    1,333
    
    
    
    
    
    
    
    25,612
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,612Issuance of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    124
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    124Balance,
February 2, 2008
    
    
    48,623
    
    
    
    8
    
    
    $
    305,254
    
    
    $
    (130,577
    )
    
    $
    124
    
    
    $
    (59
    )
    
    $
    (1,819
    )
    
    $
    160,349
    
    
    $
    333,272Income from continuing
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    99,220
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,960
    
    
    
    109,180Loss from discontinued
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (48,379
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (48,379
    )Change in minimum pension
liability, net of income
tax expense of $1,517
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,245
    )
    
    
    
    
    
    
    (2,245
    )Valuation allowance on
pension deferred tax
asset
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,670
    )
    
    
    
    
    
    
    (2,670
    )Unrealized loss on
available-for-sale
securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (655
    )
    
    
    (243
    )
    
    
    (898
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    54,988Capital transactions of
subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,806
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,506
    
    
    
    5,312Stock based compensation
expense, before related
tax effects
    
    
    
    
    
    
    
    
    
    
    1,407
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,407Exercise of stock options
    
    
    68
    
    
    
    
    
    
    
    207
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    207Balance,
January 31, 2009
    
    
    48,691
    
    
    
    8
    
    
    $
    306,868
    
    
    $
    (76,930
    )
    
    $
    124
    
    
    $
    (59
    )
    
    $
    (7,389
    )
    
    $
    172,572
    
    
    $
    395,186
  F-7




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##### Table of Contents



RETAIL VENTURES, INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY (Continued)
Years Ended January 30, 2010, January 31, 2009 and February 2, 2008
(in thousands)
 Number of Shares
    
    
    Retail Ventures, Inc. ShareholdersRetained
    
    
    
    
    
    
    
    
    
    
    TotalCommon
    
    
    Earnings
    
    
    
    
    
    
    
    
    
    
    AccumulatedCommon
    
    
    Shares and
    
    
    (Accum-
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    Non-Common
    
    
    Shares in
    
    
    Paid in
    
    
    ulated
    
    
    
    
    
    
    Treasury
    
    
    Comprehen-
    
    
    controllingShares
    
    
    Treasury
    
    
    Capital
    
    
    Deficit)
    
    
    Warrants
    
    
    Shares
    
    
    sive Loss
    
    
    Interests
    
    
    TotalBalance,
January 31, 2009
    
    
    48,691
    
    
    
    8
    
    
    $
    306,868
    
    
    $
    (76,930
    )
    
    $
    124
    
    
    $
    (59
    )
    
    $
    (7,389
    )
    
    $
    172,572
    
    
    $
    395,186Loss (income) from
continuing operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (85,971
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,361
    
    
    
    (65,610
    )Income from discontinued
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    59,880
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    59,880Change in minimum
pension liability, net
of income tax expense of
$117
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (323
    )
    
    
    
    
    
    
    (323
    )Unrealized loss on
available-for-sale
securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (99
    )
    
    
    (37
    )
    
    
    (136
    )Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,189
    )Reclassification of
unrealized losses on
available-for-sale
securities to an
other-than-temporary
impairment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    754
    
    
    
    281
    
    
    
    1,035Non-cash capital
contribution to
subsidiary
    
    
    
    
    
    
    
    
    
    
    4,670
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,670Capital transactions of
subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,744
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,244
    
    
    
    6,988Stock based compensation
expense, before related
tax effects
    
    
    
    
    
    
    
    
    
    
    997
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    997Exercise of stock options
    
    
    273
    
    
    
    
    
    
    
    612
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    612Cumulative effect of
adoption of new
accounting pronouncement
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (124
    )
    
    
    
    
    
    
    115
    
    
    
    
    
    
    
    (9
    )Balance,
January 30, 2010
    
    
    48,964
    
    
    
    8
    
    
    $
    313,147
    
    
    $
    (100,277
    )
    
    $
    
    
    
    $
    (59
    )
    
    $
    (6,942
    )
    
    $
    197,421
    
    
    $
    403,290
   F-8




---



##### Table of Contents



RETAIL VENTURES, INC.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 Years Ended January 30, 2010, January 31, 2009 and February 2, 2008
 (in thousands)
 January 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Cash flows from operating activities:Net (loss) income
    
    $
    (5,730
    )
    
    $
    60,801
    
    
    $
    71,321Less: (Income) loss from discontinued operations, net of tax
    
    
    (59,880
    )
    
    
    48,379
    
    
    
    190,525(Loss) income before discontinued operations
    
    
    (65,610
    )
    
    
    109,180
    
    
    
    261,846Adjustments to reconcile net (loss) income to net cash provided by
operating activities:Amortization of debt issuance costs and discount on debt
    
    
    3,530
    
    
    
    3,369
    
    
    
    3,339Stock based compensation expense
    
    
    997
    
    
    
    1,407
    
    
    
    947Capital transactions of subsidiary
    
    
    2,744
    
    
    
    2,806
    
    
    
    3,083Depreciation and amortization
    
    
    46,738
    
    
    
    38,466
    
    
    
    28,298Change in fair value of derivative instruments (related party -
$6,910, ($30,009) and ($151,917))
    
    
    66,499
    
    
    
    (85,235
    )
    
    
    (248,193
    )Gain on the repurchase of the Premium Income Exchangeable
Securities
    
    
    
    
    
    
    (1,486
    )Deferred income taxes and other non current liabilities
    
    
    (38,559
    )
    
    
    (6,263
    )
    
    
    46,379Impairment charges on long-lived assets
    
    
    856
    
    
    
    3,339
    
    
    
    2,081Loss on disposal of assets
    
    
    1,145
    
    
    
    2,235
    
    
    
    261Impairment charges on receivables from Filenes Basement
    
    
    57,884Other-than-temporary impairment charges on investments
    
    
    2,895
    
    
    
    1,134Other
    
    
    8,522
    
    
    
    2,263
    
    
    
    (185
    )Change in working capital, assets and liabilities:Accounts receivable
    
    
    1,532
    
    
    
    6,314
    
    
    
    (5,624
    )Inventories
    
    
    (18,276
    )
    
    
    18,029
    
    
    
    (24,300
    )Prepaid expenses and other assets
    
    
    4,933
    
    
    
    (53
    )
    
    
    (3,606
    )Accounts payable
    
    
    23,037
    
    
    
    (17,566
    )
    
    
    16,419Proceeds from lease incentives
    
    
    7,106
    
    
    
    16,106
    
    
    
    14,002Accrued expenses
    
    
    28,407
    
    
    
    1
    
    
    
    (27,469
    )Net cash provided by operating activities from continuing
operations
    
    
    134,380
    
    
    
    94,046
    
    
    
    67,278Net cash provided by (used in) operating activities from
discontinued operations
    
    
    20,563
    
    
    
    (13,984
    )
    
    
    21,897Cash flows from investing activities:Cash paid for property and equipment
    
    
    (23,080
    )
    
    
    (79,651
    )
    
    
    (98,335
    )Purchases of available-for-sale investments
    
    
    (200,002
    )
    
    
    (205,558
    )
    
    
    (209,855
    )Purchases of held-to-maturity investments
    
    
    (23,983
    )
    
    
    (2,000
    )Maturities and sales of available-for-sale investments
    
    
    153,753
    
    
    
    183,604
    
    
    
    226,000Maturities and sales of held-to-maturity investments
    
    
    6,925
    
    
    
    2,000Transfer of cash from restricted cash
    
    
    10,261Transfer of cash to restricted cash
    
    
    (10,000
    )Purchase of equity investment  related party
    
    
    (1,151
    )Acquisition of tradename
    
    
    
    
    
    
    
    
    
    
    (21
    )Net cash used in investing activities from continuing operations
    
    
    (87,277
    )
    
    
    (101,605
    )
    
    
    (82,211
    )Net cash used in investing activities from discontinued operations
    
    
    (158
    )
    
    
    (4,014
    )
    
    
    (17,731
    )
  F-9




---



##### Table of Contents



RETAIL VENTURES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
Years Ended January 30, 2010, January 31, 2009 and February 2, 2008
(in thousands)
 January 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Cash flows from financing activities:Payment of current maturities on long-term obligations
    
    
    (250
    )Payments on notes to discontinued operations
    
    
    
    
    
    
    
    
    
    
    (25,000
    )Repurchase of Premium Income Exchangeable Securities
    
    
    
    
    
    
    (5,600
    )Proceeds from exercise of warrants
    
    
    
    
    
    
    
    
    
    
    6,000Proceeds from exercise of stock options
    
    
    612
    
    
    
    207
    
    
    
    71Net cash provided by (used in) financing activities from
continuing operations
    
    
    362
    
    
    
    (5,393
    )
    
    
    (18,929
    )Net cash (used in) provided by financing activities from
discontinued operations
    
    
    (25,181
    )
    
    
    17,083
    
    
    
    (17,574
    )Net increase (decrease) in cash and equivalents from continuing
operations
    
    $
    47,465
    
    
    $
    (12,952
    )
    
    $
    (33,862
    )Cash and equivalents from continuing operations, beginning of year
    
    
    94,308
    
    
    
    107,260
    
    
    
    141,122Cash and equivalents from continuing operations, end of year
    
    $
    141,773
    
    
    $
    94,308
    
    
    $
    107,260Net decrease in cash and equivalents from discontinued operations
    
    $
    (4,776
    )
    
    $
    (915
    )
    
    $
    (13,408
    )Cash and equivalents from discontinued operations, beginning of
year
    
    
    4,776
    
    
    
    5,691
    
    
    
    19,099Cash and equivalents from discontinued operations, end of year
    
    $
    
    
    
    $
    4,776
    
    
    $
    5,691
   F-10




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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 1. BUSINESS OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Business Operations
      F-11




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##### Table of Contents



Principles of Consolidation
  Fiscal Year
  Use of Estimates
  Cash and Equivalents
   Investments
   Accounts Receivable
  Concentration of Credit Risk
   F-12




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##### Table of Contents



Concentration of Vendor Risk
  Allowance for Doubtful Accounts
  Beginning
    
    
    
    
    
    
    
    
    
    
    EndingFiscal years ended:
    
    Balance
    
    
    Expenses
    
    
    Deductions
    
    
    BalanceJanuary 30, 2010
    
    $
    1,192
    
    
    $
    5,652
    
    
    $
    (1,501
    )
    
    $
    5,343January 31, 2009
    
    
    399
    
    
    
    2,166
    
    
    
    (1,373
    )
    
    
    1,192February 2, 2008
    
    
    115
    
    
    
    286
    
    
    
    (2
    )
    
    
    399
  Beginning
    
    
    
    
    
    
    
    
    
    
    EndingFiscal year ended:
    
    Balance
    
    
    Expenses
    
    
    Deductions
    
    
    BalanceJanuary 30, 2010
    
    $
    
    
    
    $
    52,559
    
    
    $
    (52,559
    )
    
    $
 Inventories
      F-13




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##### Table of Contents



Property and Equipment
  Furniture, fixtures and equipment
    
    3 to 10 yearsLeasehold improvements
    
    Shorter of the life of the lease or 10 years
 Asset Impairment and Long-Lived Assets
  Goodwill
   Tradenames and Other Intangible Assets
   Equity Investments
   F-14




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##### Table of Contents



Self-insurance Reserves
  Deferred Rent
  Construction and Tenant Allowances
  Accumulated Other Comprehensive Loss
  Sales and Revenue Recognition
   Cost of Sales
   F-15




---



##### Table of Contents



Selling, General and Administrative Expenses
  New Store Costs
  Marketing Expense
  Customer Loyalty Program
  Derivative Financial Instruments
 Derivatives and Hedging
 Noncontrolling Interests
  Earnings Per Share
  Stock-Based Compensation
  Comprehensive (Loss) Income
   F-16




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##### Table of Contents



Legal Proceedings and Claims
  Income Taxes
 Income
Taxes
 Sale of subsidiary stock
  Recent Accounting Pronouncements
 Business Combinations
 Business Combinations
 Derivatives and Hedging
 Derivatives and Hedging, Contracts in
Entitys Own Equity Derivatives and Hedging
  F-17




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##### Table of Contents



Derivatives and Hedging, Contracts in
Entitys Own Equity
 Goodwill and Other Intangible Assets,
General Intangibles Other than Goodwill
 Debt, Debt with Conversion and Other Options
 Earnings Per Share
 Fair Value Measurements and Disclosures
 Fair Value Measurements and Disclosures
  F-18




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##### Table of Contents



Investments  Debt and Equity Securities
 Financial Instruments
 Transfers and Servicing
 Consolidation
 Generally Accepted Accounting
Principles
  2. DISCONTINUED OPERATIONS
 Value City
    F-19




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##### Table of Contents



Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Net sales
    
    
    
    
    
    
    
    
    
    $
    1,172,687Loss before income taxes
    
    
    
    
    
    
    
    
    
    $
    (60,653
    )Income tax benefitIncome (loss) on disposal
    
    $
    9,513
    
    
    $
    13,223
    
    
    
    (90,009
    )Income (loss) from discontinued operations, net of tax  Value City
    
    $
    9,513
    
    
    $
    13,223
    
    
    $
    (150,662
    )
 Filenes Basement
  Total Investment in Filenes Basement as of April 21, 2009
    
    $
    (90,026
    )Disposition Costs:Selling costs to Dispose of Filenes Basement
    
    
    8,760Outstanding Guarantees
    
    
    400Impairment of Fixed Assets not sold
    
    
    1,819Total Disposition Costs
    
    
    10,979Pre-tax gain on disposition of Filenes Basement
    
    
    (79,047
    )Less tax effect
    
    
    (2,860
    )After tax gain on disposition of Filenes Basement
    
    $
    (81,907
    )
   F-20




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##### Table of Contents



Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Net sales
    
    $
    63,351
    
    
    $
    422,099
    
    
    $
    466,289Loss before income taxes
    
    $
    (31,195
    )
    
    $
    (62,003
    )
    
    $
    (25,658
    )Income tax (expense) benefit
    
    
    (345
    )
    
    
    401
    
    
    
    (14,205
    )Gain on sale
    
    
    81,907Income (loss) from
discontinued operations, net
of tax  Filenes Basement
    
    $
    50,367
    
    
    $
    (61,602
    )
    
    $
    (39,863
    )
  F-21




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##### Table of Contents



January 31,2009Cash
    
    $
    4,776Accounts receivable, net
    
    
    1,670Inventories
    
    
    58,384Prepaid expenses and other
    
    
    1,848Total current assets
    
    
    66,678Property and equipment, net
    
    
    33,590Tradenames and intangibles, net
    
    
    4,255Other non current assets
    
    
    948Total non current assets
    
    
    38,793Total assets
    
    $
    105,471Accounts payable, net
    
    $
    18,805Accrued expenses
    
    
    17,642Revolving credit facility
    
    
    39,583Total current liabilities
    
    
    76,030Other non current liabilities
    
    
    36,055Total non current liabilities
    
    
    36,055Total liabilities
    
    $
    112,085
  3. RELATED PARTY TRANSACTIONS
      F-22




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##### Table of Contents



Value City
 4. STOCK BASED COMPENSATION
 Compensation  Stock Compensation
   Retail Ventures Stock Compensation Plans
     F-23




---



##### Table of Contents



Stock Options
   Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Risk-free interest rate
    
    
    2.2
    %
    
    
    2.2
    %
    
    
    4.4
    %Expected volatility of Retail Ventures Common Shares
    
    
    85.3
    %
    
    
    66.5
    %
    
    
    56.1
    %Expected option term
    
    4.9 years
    
    
    5.0 years
    
    
    5.0 yearsExpected dividend yield
    
    
    0.0
    %
    
    
    0.0
    %
    
    
    0.0
    %
  F-24




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##### Table of Contents



Fiscal Year EndedJanuary 30, 2010
    
    
    January 31, 2009
    
    
    February 2, 2008Shares
    
    
    WAEP
    
    
    Shares
    
    
    WAEP
    
    
    Shares
    
    
    WAEPOutstanding beginning of year
    
    
    1,247
    
    
    $
    5.13
    
    
    
    1,312
    
    
    $
    5.97
    
    
    
    1,335
    
    
    $
    5.59Granted
    
    
    50
    
    
    $
    3.73
    
    
    
    250
    
    
    $
    2.89
    
    
    
    50
    
    
    $
    15.09Exercised
    
    
    (259
    )
    
    $
    2.04
    
    
    
    (68
    )
    
    $
    3.05
    
    
    
    (19
    )
    
    $
    3.67Forfeited
    
    
    (212
    )
    
    $
    3.27
    
    
    
    (247
    )
    
    $
    7.95
    
    
    
    (54
    )
    
    $
    5.83Outstanding end of year
    
    
    826
    
    
    $
    6.48
    
    
    
    1,247
    
    
    $
    5.13
    
    
    
    1,312
    
    
    $
    5.97Options exercisable end of year
    
    
    776
    
    
    $
    6.66
    
    
    
    1,045
    
    
    $
    5.74
    
    
    
    1,207
    
    
    $
    5.76
 WeightedAverage
    
    
    AggregateRemaining
    
    
    IntrinsicFiscal Year Ended January 30, 2010
    
    Shares
    
    
    WAEP
    
    
    GDFV
    
    
    Contract Life
    
    
    ValueOptions outstanding
    
    
    826
    
    
    $
    6.48
    
    
    $
    3.81
    
    
    4 years
    
    $
    2,397Options vested or expected to vest
    
    
    822
    
    
    $
    6.49
    
    
    $
    3.82
    
    
    4 years
    
    $
    2,380Options exercisable
    
    
    776
    
    
    $
    6.66
    
    
    $
    3.90
    
    
    3 years
    
    $
    2,170Shares available for additional grants
    
    
    4,679
   Stock Appreciation Rights
    F-25




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##### Table of Contents



Fiscal Year EndedJanuary 30, 2010
    
    
    January 31, 2009
    
    
    February 2, 2008Shares
    
    
    WAEP
    
    
    Shares
    
    
    WAEP
    
    
    Shares
    
    
    WAEPOutstanding beginning of year
    
    
    395
    
    
    $
    12.18
    
    
    
    725
    
    
    $
    11.66
    
    
    
    978
    
    
    $
    9.49Granted
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    140
    
    
    $
    20.72Exercised
    
    
    (14
    )
    
    $
    5.85
    
    
    
    
    
    
    
    
    
    
    
    (205
    )
    
    $
    6.21Forfeited
    
    
    (204
    )
    
    $
    12.25
    
    
    
    (330
    )
    
    $
    11.04
    
    
    
    (188
    )
    
    $
    13.05Outstanding end of year
    
    
    177
    
    
    $
    12.61
    
    
    
    395
    
    
    $
    12.18
    
    
    
    725
    
    
    $
    11.66Options exercisable end of year
    
    
    163
    
    
    $
    12.05
    
    
    
    251
    
    
    $
    9.41
    
    
    
    307
    
    
    $
    7.97
 Restricted Stock Units
    Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Outstanding beginning of year
    
    
    12
    
    
    
    57
    
    
    
    170Granted
    
    
    
    
    
    
    
    
    
    
    47Exercised/Vested
    
    
    (6
    )
    
    
    (35
    )
    
    
    (160
    )Forfeited
    
    
    
    
    
    
    (10
    )Outstanding end of year
    
    
    6
    
    
    
    12
    
    
    
    57
 Restricted Shares
   F-26




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##### Table of Contents



DSW Stock Compensation Plan
  Stock Options
 Compensation  Stock Compensation
   Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Risk-free interest rate
    
    
    1.9
    %
    
    
    2.7
    %
    
    
    4.5
    %Expected volatility of DSW Common Shares
    
    
    57.6
    %
    
    
    48.5
    %
    
    
    39.4
    %Expected option term
    
    4.9 years
    
    
    5.0 years
    
    
    5.0 yearsExpected dividend yield
    
    
    0.0
    %
    
    
    0.0
    %
    
    
    0.0
    %
  Fiscal Year EndedJanuary 30, 2010
    
    
    January 31, 2009
    
    
    February 2, 2008Shares
    
    
    WAEP
    
    
    Shares
    
    
    WAEP
    
    
    Shares
    
    
    WAEPOutstanding beginning of year
    
    
    2,125
    
    
    $
    22.04
    
    
    
    1,520
    
    
    $
    28.65
    
    
    
    1,084
    
    
    $
    22.14Granted
    
    
    946
    
    
    $
    10.17
    
    
    
    1,112
    
    
    $
    12.87
    
    
    
    527
    
    
    $
    41.67Exercised
    
    
    (91
    )
    
    $
    14.55
    
    
    
    (1
    )
    
    $
    12.92
    
    
    
    (13
    )
    
    $
    20.04Forfeited
    
    
    (476
    )
    
    $
    20.21
    
    
    
    (506
    )
    
    $
    21.85
    
    
    
    (78
    )
    
    $
    27.46Outstanding end of year
    
    
    2,504
    
    
    $
    18.20
    
    
    
    2,125
    
    
    $
    22.04
    
    
    
    1,520
    
    
    $
    28.65Options exercisable end of year
    
    
    773
    
    
    $
    23.26
    
    
    
    533
    
    
    $
    24.77
    
    
    
    379
    
    
    $
    20.90
  F-27




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##### Table of Contents



WeightedAverage
    
    
    AggregateRemaining
    
    
    IntrinsicFiscal Year Ended January 30, 2010
    
    Shares
    
    
    WAEP
    
    
    GDFV
    
    
    Contract Life
    
    
    ValueOptions outstanding
    
    
    2,504
    
    
    $
    18.20
    
    
    $
    8.04
    
    
    8 years
    
    $
    21,711Options vested or expected to vest
    
    
    2,375
    
    
    $
    18.32
    
    
    $
    8.09
    
    
    8 years
    
    $
    20,371Options exercisable
    
    
    773
    
    
    $
    23.26
    
    
    $
    9.93
    
    
    6 years
    
    $
    3,616Shares available for additional grants
    
    
    4,481
  Restricted Stock Units
    Fiscal Year EndedJanuary 30, 2010
    
    
    January 31, 2009
    
    
    February 2, 2008Units
    
    
    GDFV
    
    
    Units
    
    
    GDFV
    
    
    Units
    
    
    GDFVOutstanding beginning of year
    
    
    226
    
    
    $
    17.51
    
    
    
    151
    
    
    $
    23.92
    
    
    
    135
    
    
    $
    22.03Granted
    
    
    180
    
    
    $
    10.39
    
    
    
    158
    
    
    $
    12.61
    
    
    
    29
    
    
    $
    28.69Exercised
    
    
    (75
    )
    
    $
    19.77
    
    
    
    (8
    )
    
    $
    26.61
    
    
    
    (10
    )
    
    $
    24.85Forfeited
    
    
    (64
    )
    
    $
    15.30
    
    
    
    (75
    )
    
    $
    19.08
    
    
    
    (3
    )
    
    $
    27.96Outstanding end of year
    
    
    267
    
    
    $
    12.61
    
    
    
    226
    
    
    $
    17.51
    
    
    
    151
    
    
    $
    23.92
 Director Stock Units
   F-28




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##### Table of Contents



5. INVESTMENTS
  ®
   Short-term Investments, net
    
    
    Long-term Investments, netFiscal Year Ended
    
    
    Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    January 30,
    
    
    January 31,2010
    
    
    2009
    
    
    2010
    
    
    2009Available-for-sale:Tax exempt, tax advantaged and taxable bonds
    
    $
    124,107
    
    
    $
    65,829Variable rate demand notes
    
    
    
    
    
    
    16,580Tax exempt commercial paper
    
    
    8,100
    
    
    
    2,000Certificates of deposit
    
    
    15,000
    
    
    
    14,000Auction rate securities
    
    
    
    
    
    
    3,650
    
    
    $
    2,500
    
    
    $
    2,400Other-than-temporary impairment included in earnings
    
    
    
    
    
    
    
    
    
    
    (2,500
    )
    
    
    (1,134
    )Unrealized losses included in accumulated other comprehensive loss
    
    
    
    
    
    
    (655
    )Total available-for-sale investments
    
    $
    147,207
    
    
    $
    101,404
    
    
    
    
    
    
    $
    1,266Held-to-maturity:Tax exempt term notes
    
    
    17,058Equity
investment  related party
    
    
    
    
    
    
    
    
    
    
    1,151Total investments
    
    $
    164,265
    
    
    $
    101,404
    
    
    $
    1,151
    
    
    $
    1,266
  F-29




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##### Table of Contents



6. LEASES
   Operating LeasesUnrelated
    
    
    RelatedFiscal Year
    
    Total
    
    
    Party
    
    
    Party2010
    
    $
    132,916
    
    
    $
    119,442
    
    
    $
    13,4742011
    
    
    128,051
    
    
    
    114,125
    
    
    
    13,9262012
    
    
    119,161
    
    
    
    104,853
    
    
    
    14,3082013
    
    
    111,664
    
    
    
    97,967
    
    
    
    13,6972014
    
    
    104,872
    
    
    
    91,206
    
    
    
    13,666Future Years
    
    
    318,536
    
    
    
    255,692
    
    
    
    62,844Total minimum lease payments
    
    $
    915,200
    
    
    $
    783,285
    
    
    $
    131,915
  Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Continuing operations:Minimum rentals:Unrelated parties
    
    $
    109,626
    
    
    $
    103,382
    
    
    $
    92,396Related parties
    
    
    10,887
    
    
    
    11,178
    
    
    
    10,561Contingent rentals:Unrelated parties
    
    
    31,871
    
    
    
    28,261
    
    
    
    25,391Total continuing operations
    
    $
    152,384
    
    
    $
    142,821
    
    
    $
    128,348
   F-30




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##### Table of Contents



7. LONG TERM OBLIGATIONS
  January 30,
    
    
    January 31,2010
    
    
    2009Continuing Operations:Credit facilities:Senior Loan Agreement  related parties
    
    
    
    
    
    $
    250Premium Income Exchangeable Securities (PIES)
    
    $
    133,750
    
    
    
    133,750Discount on PIES
    
    
    (3,993
    )
    
    
    (6,174
    )129,757
    
    
    
    127,826Less: current maturities
    
    
    
    
    
    
    (250
    )Total long term obligations of continuing operations
    
    $
    129,757
    
    
    $
    127,576Letters of credit outstanding under DSW revolving credit facility
    
    $
    17,440
    
    
    $
    17,709Availability under DSW revolving credit facility
    
    $
    132,560
    
    
    $
    132,291
  $150 Million Secured Revolving Credit Facility  The DSW Revolving Loan
     F-31




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##### Table of Contents



$143,750,000 Premium Income Exchangeable Securities SM (PIES)
    January 30,
    
    
    January 31,2010
    
    
    2009Contractual interest expense
    
    $
    9,444
    
    
    $
    9,550Amortization of debt discount
    
    
    2,181
    
    
    
    2,020Total interest expense
    
    $
    11,625
    
    
    $
    11,570Effective interest rate
    
    
    8.6
    %
    
    
    8.6
    %
   January 30,
    
    
    January 31,2010
    
    
    2009Risk-free interest rate
    
    
    1.3
    %
    
    
    3.0
    %Expected volatility of Common Shares
    
    
    70.9
    %
    
    
    58.0
    %Expected option term
    
    1.6 years
    
    
    2.6 yearsExpected dividend yield
    
    
    0.0
    %
    
    
    0.0
    %
  F-32




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##### Table of Contents



Other Debt Items
    Fiscal Year
    
    Amount20102011
    
    $
    133,750201220132014Future yearsTotal
    
    $
    133,750
 8. FAIR VALUE MEASUREMENTS
  
    
    Level 1 inputs are unadjusted quoted prices in active markets for identical assets or
liabilities that are publicly accessible. Active markets have frequent transactions with
enough volume to provide ongoing pricing information.
 
    
    Level 2 inputs are other than level 1 inputs that are directly or indirectly observable.
These can include unadjusted quoted prices for similar assets or liabilities in active
markets, unadjusted quoted prices for identical assets or liabilities in inactive markets,
or other observable inputs.
 
    
    Level 3 inputs are unobservable inputs.
  Balance as of January 30, 2010
    
    
    Balance as of January 31, 2009Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3Assets:Cash and equivalents
    
    $
    141,773
    
    
    $
    141,773
    
    
    
    
    
    
    
    
    
    
    $
    94,308
    
    
    $
    94,308Restricted Cash
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    261
    
    
    
    261Short-term investments, net
    
    
    164,265
    
    
    
    
    
    
    $
    164,265
    
    
    
    
    
    
    
    101,404
    
    
    
    
    
    
    $
    99,559
    
    
    $
    1,845Long-term investments, net
    
    
    1,151
    
    
    
    
    
    
    
    
    
    
    $
    1,151
    
    
    
    1,266
    
    
    
    
    
    
    
    
    
    
    
    1,266Conversion feature of long-term
debt
    
    
    28,029
    
    
    
    
    
    
    
    28,029
    
    
    
    
    
    
    
    77,761
    
    
    
    
    
    
    
    77,761$
    335,218
    
    
    $
    141,773
    
    
    $
    192,294
    
    
    $
    1,151
    
    
    $
    275,000
    
    
    $
    94,569
    
    
    $
    177,320
    
    
    $
    3,111Liabilities:Warrant liability
    
    $
    23,068
    
    
    
    
    
    
    $
    23,068
    
    
    
    
    
    
    $
    6,292
    
    
    
    
    
    
    $
    6,292$
    23,068
    
    
    
    
    
    
    $
    23,068
    
    
    
    
    
    
    $
    6,292
    
    
    
    
    
    
    $
    6,292
  F-33




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##### Table of Contents



January
30, 2010
    
    
    January 31, 2009Short-term
    
    
    Long-term
    
    
    Short-term
    
    
    Long-terminvestments,
    
    
    investments,
    
    
    investments,
    
    
    investments,net
    
    
    net
    
    
    net
    
    
    netCarrying value at the beginning of the period
    
    $
    1,845
    
    
    $
    1,266
    
    
    $
    70,005
    
    
    $
    12,500Maturities and sales
    
    
    
    
    
    
    
    
    
    
    (68,855
    )
    
    
    (7,600
    )Purchase of equity investment
    
    
    
    
    
    
    1,151Transfer out of level 3
    
    
    
    
    
    
    (1,266
    )
    
    
    (1,150
    )Transfers between short-term and long-term
investments, net
    
    
    (1,845
    )
    
    
    1,845
    
    
    
    2,500
    
    
    
    (2,500
    )Reclassification of unrealized losses on
available-for-sale securities to an
other-than-temporary impairment
    
    
    
    
    
    
    655Unrealized losses included in accumulated
other comprehensive loss
    
    
    
    
    
    
    
    
    
    
    (655
    )Other-than-temporary impairment included in
earnings
    
    
    
    
    
    
    (2,500
    )
    
    
    
    
    
    
    (1,134
    )Carrying value at the end of the period
    
    $
    
    
    
    $
    1,151
    
    
    $
    1,845
    
    
    $
    1,266
  Balance as ofJanuary 30,2010
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3Assets:Long-lived assets to be held and used
    
    $
    1,004
    
    
    
    
    
    
    
    
    
    
    $
    1,004$
    1,004
    
    
    
    
    
    
    
    
    
    
    $
    1,004
    F-34




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##### Table of Contents



January 30,
    
    
    January 31,Balance Sheet Location
    
    2010
    
    
    2009Warrants
    
    Warrant liability
    
    $
    (23,068
    )
    
    $
    (6,292
    )Conversion feature of long-term debt
    
    Conversion feature of long-term debt
    
    
    28,029
    
    
    
    77,761Total
    
    
    
    $
    4,961
    
    
    $
    71,469
  January 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Warrants
    
    $
    (16,768
    )
    
    $
    49,314
    
    
    $
    93,618Conversion feature of long-term debt
    
    
    (49,731
    )
    
    
    35,921
    
    
    
    154,575(Expense) income related to the
change in fair value of derivative
instruments
    
    $
    (66,499
    )
    
    $
    85,235
    
    
    $
    248,193
 9. EARNINGS PER SHARE
  Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Assumed exercise of dilutive weighted average shares
outstanding
    
    
    48,878
    
    
    
    48,669
    
    
    
    48,165Assumed exercise of dilutive stock appreciation rights
    
    
    
    
    
    
    6
    
    
    
    227Assumed exercise of dilutive stock options
    
    
    
    
    
    
    144
    
    
    
    527Assumed exercise of dilutive warrants
    
    
    
    
    
    
    707
    
    
    
    7,875Number of shares for computation of dilutive earnings per share
    
    
    48,878
    
    
    
    49,526
    
    
    
    56,794
  Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008VCHI warrants
    
    
    
    
    
    
    150
    
    
    
    150Stock options
    
    
    187
    
    
    
    974
    
    
    
    334SARs
    
    
    124
    
    
    
    445
    
    
    
    499Total of all potentially dilutive instruments
    
    
    311
    
    
    
    1,569
    
    
    
    983
  F-35




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##### Table of Contents



10. PENSION BENEFIT PLANS
   January 30,
    
    
    January 31,2010
    
    
    2009Change in projected benefit obligation:Projected benefit obligation at beginning of year
    
    $
    16,341
    
    
    $
    16,307Interest cost
    
    
    974
    
    
    
    935Benefits paid
    
    
    (752
    )
    
    
    (715
    )Actuarial loss (gain)
    
    
    1,110
    
    
    
    (186
    )Projected benefit obligation at end of year
    
    $
    17,673
    
    
    $
    16,341Accumulated benefit obligation at end of year
    
    $
    17,673
    
    
    $
    16,341Change in plan assets:Fair market value at beginning of year
    
    $
    11,548
    
    
    $
    14,563Actual gain (loss) on plan assets
    
    
    1,688
    
    
    
    (2,661
    )Employer contributions
    
    
    
    
    
    
    500Benefits paid
    
    
    (752
    )
    
    
    (715
    )Other
    
    
    (124
    )
    
    
    (139
    )Fair market value at end of year
    
    $
    12,360
    
    
    $
    11,548
   Fiscal Year
    
    Amount2010
    
    $
    8262011
    
    
    8232012
    
    
    8602013
    
    
    8812014
    
    
    9162015  2020
    
    
    5,498
  January 30,
    
    
    January 31,2010
    
    
    2009Other non current liabilities
    
    $
    (5,313
    )
    
    $
    (4,793
    )Accumulated other comprehensive loss
    
    $
    (6,942
    )
    
    $
    (7,389
    )
  F-36




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##### Table of Contents



Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Interest cost
    
    $
    974
    
    
    $
    935
    
    
    $
    907Expected return on plan assets
    
    
    (755
    )
    
    
    (1,125
    )
    
    
    (1,212
    )Amortization of transition asset
    
    
    (38
    )
    
    
    (38
    )
    
    
    (38
    )Amortization of net loss
    
    
    570
    
    
    
    442
    
    
    
    244Net periodic benefit cost
    
    $
    751
    
    
    $
    214
    
    
    $
    (99
    )
  Remaining unrecognized benefit obligation existing at transition
    
    $
    (35
    )Unrecognized net loss
    
    
    291Total
    
    $
    256
  Fiscal Year EndedJanuary 30,
    
    
    January 31,2010
    
    
    2009Discount rate
    
    
    5.8
    %
    
    
    6.3
    %Expected long-term rate of return
    
    
    7.0
    %
    
    
    7.0
    %
  Equity securities
    
    
    45-65
    %Fixed securities
    
    
    35-55
    %
  Fiscal Year EndedJanuary 30,
    
    
    January 31,2010
    
    
    2009Equity securities
    
    
    53.5
    %
    
    
    52.4
    %Fixed securities
    
    
    46.0
    %
    
    
    47.1
    %Other
    
    
    0.5
    %
    
    
    0.5
    %Total
    
    
    100.0
    %
    
    
    100.0
    %
  F-37




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##### Table of Contents




    
    Level 1 inputs are unadjusted quoted prices in active markets for identical assets or
liabilities that are publicly accessible. Active markets have frequent transactions with
enough volume to provide ongoing pricing information.
 
    
    Level 2 inputs are other than level 1 inputs that are directly or indirectly observable.
These can include unadjusted quoted prices for similar assets or liabilities in active
markets, unadjusted quoted prices for identical assets or liabilities in inactive markets,
or other observable inputs.
 
    
    Level 3 inputs are unobservable inputs.
  Fiscal Year EndedJanuary 30, 2010
    
    
    January 31, 2009Total
    
    
    Level 1
    
    
    Level 2
    
    
    Total
    
    
    Level 1
    
    
    Level 2Assets:Cash and equivalents
    
    $
    64
    
    
    $
    64
    
    
    
    
    
    
    $
    62
    
    
    $
    62Fixed income
    
    
    5,679
    
    
    
    
    
    
    $
    5,679
    
    
    
    5,438
    
    
    
    
    
    
    $
    5,438Large cap funds
    
    
    5,339
    
    
    
    
    
    
    
    5,339
    
    
    
    4,980
    
    
    
    
    
    
    
    4,980Small and mid cap funds
    
    
    1,278
    
    
    
    
    
    
    
    1,278
    
    
    
    1,068
    
    
    
    
    
    
    
    1,068Fair market value at
end of year
    
    $
    12,360
    
    
    $
    64
    
    
    $
    12,296
    
    
    $
    11,548
    
    
    $
    62
    
    
    $
    11,486
 11. OTHER BENEFIT PLANS
  12. WARRANTS
 Warrants
 Derivatives and Hedging
   F-38




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##### Table of Contents



Derivatives and
Hedging
  ConversionTerm Warrants
    
    
    WarrantsJanuary 30,
    
    
    January 31,
    
    
    January 31,2010
    
    
    2009
    
    
    2009Assumptions:Risk-free interest rate
    
    
    0.8
    %
    
    
    1.3
    %
    
    
    0.3
    %Expected volatility of Common Shares
    
    
    123.0
    %
    
    
    95.9
    %
    
    
    114.3
    %Expected option term
    
    2.4 years
    
    
    3.4 years
    
    
    0.4 yearsExpected dividend yield
    
    
    0.0
    %
    
    
    0.0
    %
    
    
    0.0
    %
 VCHI Acquisition Co. Warrants
  Derivatives and Hedging, Contracts in Entitys Own Equit
 13. COMMITMENTS AND CONTINGENCIES
   F-39




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##### Table of Contents



Guarantees and Liabilities related to Discontinued Operations
  Value City
   Filenes Basement
  Contractual Obligations
  14. INCOME TAXES
  Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Current:Federal
    
    $
    41,924
    
    
    $
    16,178
    
    
    $
    30,259State and local
    
    
    6,935
    
    
    
    (1,231
    )
    
    
    6,528Total current tax expense
    
    
    48,859
    
    
    
    14,947
    
    
    
    36,787Deferred:Federal
    
    
    (30,531
    )
    
    
    3,779
    
    
    
    33,133State and local
    
    
    (6,273
    )
    
    
    (1,840
    )
    
    
    2,483Total deferred tax expense (benefit)
    
    
    (36,804
    )
    
    
    1,939
    
    
    
    35,616Income tax expense
    
    $
    12,055
    
    
    $
    16,886
    
    
    $
    72,403
  F-40




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##### Table of Contents



Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Income tax (benefit) expense at federal statutory rate of 35%
    
    $
    (18,744
    )
    
    $
    43,978
    
    
    $
    116,987Warrant liability marked to market
    
    
    5,872
    
    
    
    (12,572
    )
    
    
    (54,058
    )Jobs credit
    
    
    (175
    )
    
    
    (198
    )
    
    
    (232
    )State and local taxes, net
    
    
    (1,519
    )
    
    
    273
    
    
    
    7,461Tax exempt interest
    
    
    (495
    )
    
    
    (550
    )
    
    
    (1,476
    )Valuation allowance
    
    
    20,793
    
    
    
    (16,034
    )
    
    
    (780
    )Uncertain tax positions
    
    
    601
    
    
    
    56Provision to return adjustments
    
    
    (1,490
    )
    
    
    (2,359
    )
    
    
    183Change in subsidiary basis
    
    
    4,844
    
    
    
    3,644
    
    
    
    4,013Other
    
    
    2,368
    
    
    
    648
    
    
    
    305Income tax expense
    
    $
    12,055
    
    
    $
    16,886
    
    
    $
    72,403
  F-41




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##### Table of Contents



Fiscal Year EndedJanuary 30,
    
    
    January 31,2010
    
    
    2009Deferred tax assets:Basis differences in inventory
    
    $
    5,314
    
    
    $
    4,074Construction and tenant allowances
    
    
    4,178
    
    
    
    2,335Stock compensation
    
    
    7,536
    
    
    
    6,417State net operating loss & credits
    
    
    24,449
    
    
    
    18,883Federal net operating loss
    
    
    111,498
    
    
    
    81,467Federal tax credit
    
    
    14,886
    
    
    
    14,886Capital loss carryforward
    
    
    16,017Benefit from unrecognized tax position
    
    
    8,273
    
    
    
    794Guarantees
 Value City
    
    
    1,110
    
    
    
    5,131Workers compensation
    
    
    880
    
    
    
    1,390Accrued expenses
    
    
    5,865
    
    
    
    4,284Accrued rent
    
    
    13,358
    
    
    
    13,157PIES
    
    
    525
    
    
    
    (23,298
    )Unredeemed gift cards
    
    
    1,749
    
    
    
    1,202Bad debt reserve
    
    
    1,774
    
    
    
    164Pension
    
    
    2,061Other
    
    
    3,872
    
    
    
    2,250Total deferred tax assets
    
    
    223,345
    
    
    
    133,136Less: Valuation allowance
    
    
    (91,790
    )
    
    
    (50,721
    )131,555
    
    
    
    82,415Deferred tax liabilities:Basis in subsidiary
    
    
    (84,981
    )
    
    
    (80,137
    )Basis differences in property and equipment
    
    
    (9,138
    )
    
    
    (4,007
    )Prepaid expenses
    
    
    (4,215
    )
    
    
    (4,773
    )Other
    
    
    (645
    )
    
    
    (256
    )Total deferred tax liabilities
    
    
    (98,979
    )
    
    
    (89,173
    )Total net
    
    $
    32,576
    
    
    $
    (6,758
    )
  Fiscal Year EndedJanuary 30,
    
    
    January 31,2010
    
    
    2009Current deferred tax asset
    
    $
    29,560
    
    
    $
    22,243Non current deferred tax asset
    
    
    5,657
    
    
    
    805Non current deferred tax liability
    
    
    (2,641
    )
    
    
    (29,806
    )Net deferred
tax asset (liability)
    
    $
    32,576
    
    
    $
    (6,758
    )
  F-42




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##### Table of Contents



Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Beginning Balance
    
    $
    1,277
    
    
    $
    3,028
    
    
    $
    2,004(Decreases)
 Tax Positions taken in the prior period
    
    
    (208
    )
    
    
    (1,760
    )
    
    
    (1,123
    )Increases  Tax positions taken in the current period
    
    
    7,970
    
    
    
    9
    
    
    
    2,147Ending Balance
    
    $
    9,039
    
    
    $
    1,277
    
    
    $
    3,028
  15. SEGMENT REPORTING
    F-43




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##### Table of Contents



Category
    
    Fiscal 2009
    
    
    Fiscal 2008
    
    
    Fiscal 2007Womens
    
    
    66
    %
    
    
    66
    %
    
    
    65
    %Mens
    
    
    15
    %
    
    
    15
    %
    
    
    16
    %Athletic
    
    
    13
    %
    
    
    14
    %
    
    
    14
    %Accessories and Other
    
    
    6
    %
    
    
    5
    %
    
    
    5
    %
  TotalIntersegment
    
    
    ContinuingAs of and for the Year ended January 30, 2010
    
    DSW
    
    
    Corporate
    
    
    Eliminations
    
    
    OperationsNet sales
    
    $
    1,602,605
    
    
    
    
    
    
    
    
    
    
    $
    1,602,605Operating profit (loss)
    
    
    93,455
    
    
    $
    (133,299
    )
    
    
    
    
    
    
    (39,844
    )Depreciation and amortization
    
    
    46,260
    
    
    
    478
    
    
    
    
    
    
    
    46,738Interest expense
    
    
    1,414
    
    
    
    12,218
    
    
    
    
    
    
    
    13,632Interest income
    
    
    2,217
    
    
    
    71
    
    
    
    
    
    
    
    2,288Income tax (expense) benefit
    
    
    (37,150
    )
    
    
    25,095
    
    
    
    
    
    
    
    (12,055
    )Capital expenditures
    
    
    21,785
    
    
    
    
    
    
    
    
    
    
    
    21,785Total assets
    
    
    850,756
    
    
    
    52,709
    
    
    
    
    
    
    
    903,465
 TotalIntersegment
    
    
    ContinuingAs of and for the Year ended January 31, 2009
    
    DSW
    
    
    Corporate
    
    
    Eliminations
    
    
    OperationsNet sales
    
    $
    1,462,944
    
    
    
    
    
    
    
    
    
    
    $
    1,462,944Operating profit
    
    
    42,813
    
    
    $
    85,235
    
    
    
    
    
    
    
    128,048Depreciation and amortization
    
    
    36,336
    
    
    
    2,130
    
    
    
    
    
    
    
    38,466Interest expense
    
    
    794
    
    
    
    12,809
    
    
    
    
    
    
    
    13,603Interest income
    
    
    3,400
    
    
    
    7,869
    
    
    
    
    
    
    
    11,269Income tax (expense) benefit
    
    
    (17,383
    )
    
    
    497
    
    
    
    
    
    
    
    (16,886
    )Capital expenditures
    
    
    80,974
    
    
    
    20
    
    
    
    (2,336
    )
    
    
    78,658Total assets
    
    
    719,615
    
    
    
    128,676
    
    
    
    
    
    
    
    848,291
 TotalIntersegment
    
    
    ContinuingAs of and for the Year ended February 2, 2008
    
    DSW
    
    
    Corporate
    
    
    Eliminations
    
    
    OperationsNet sales
    
    $
    1,405,615
    
    
    
    
    
    
    
    
    
    
    $
    1,405,615Operating profit
    
    
    81,321
    
    
    $
    248,193
    
    
    
    
    
    
    
    329,514Depreciation and amortization
    
    
    25,055
    
    
    
    3,243
    
    
    
    
    
    
    
    28,298Interest expense
    
    
    1,178
    
    
    
    12,718
    
    
    
    
    
    
    
    13,896Interest income
    
    
    7,148
    
    
    
    11,483
    
    
    
    
    
    
    
    18,631Income tax expense
    
    
    (33,516
    )
    
    
    (38,887
    )
    
    
    
    
    
    
    (72,403
    )Capital expenditures
    
    
    102,451
    
    
    
    (715
    )
    
    
    
    
    
    
    101,736
  F-44




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##### Table of Contents



16. QUARTERLY FINANCIAL DATA (UNAUDITED)
  Thirteen weeks endedMay 2,
    
    
    August 1,
    
    
    October 31,
    
    
    January 30,Year ended January 30, 2010
    
    2009
    
    
    2009
    
    
    2009
    
    
    2010Net sales
    
    $
    385,846
    
    
    $
    369,490
    
    
    $
    444,621
    
    
    $
    402,648Cost of sales (exclusive of depreciation
included below in selling, general and
administrative expenses)
    
    
    (217,600
    )
    
    
    (210,267
    )
    
    
    (238,549
    )
    
    
    (224,049
    )Selling, general and administrative expenses
    
    
    (214,988
    )
    
    
    (151,290
    )
    
    
    (164,862
    )
    
    
    (154,345
    )Change in fair value of derivative instruments
    
    
    (1,388
    )
    
    
    (8,689
    )
    
    
    (30,701
    )
    
    
    (25,721
    )Operating (loss) profit
    
    
    (48,130
    )
    
    
    (756
    )
    
    
    10,509
    
    
    
    (1,467
    )Interest expense
    
    
    (3,215
    )
    
    
    (3,227
    )
    
    
    (3,236
    )
    
    
    (3,954
    )Interest income
    
    
    471
    
    
    
    794
    
    
    
    626
    
    
    
    397Interest expense, net
    
    
    (2,744
    )
    
    
    (2,433
    )
    
    
    (2,610
    )
    
    
    (3,557
    )Non-operating (expense) income
    
    
    (395
    )
    
    
    528
    
    
    
    (754
    )
    
    
    (1,746
    )(Loss) income from continuing operations
before income taxes
    
    
    (51,269
    )
    
    
    (2,661
    )
    
    
    7,145
    
    
    
    (6,770
    )Income tax (expense) benefit
    
    
    (665
    )
    
    
    (1,763
    )
    
    
    (11,079
    )
    
    
    1,452Loss from continuing operations
    
    
    (51,934
    )
    
    
    (4,424
    )
    
    
    (3,934
    )
    
    
    (5,318
    )(Loss) income from discontinued operations,
net of tax  Value City
    
    
    (43
    )
    
    
    624
    
    
    
    (498
    )
    
    
    9,430Income (loss) from discontinued operations,
net of tax  Filenes Basement
    
    
    21,670
    
    
    
    22,708
    
    
    
    203
    
    
    
    5,786Total income (loss) from discontinued
operations, net of tax
    
    
    21,627
    
    
    
    23,332
    
    
    
    (295
    )
    
    
    15,216Net (loss) income
    
    
    (30,307
    )
    
    
    18,908
    
    
    
    (4,229
    )
    
    
    9,898Less: net income attributable to the
noncontrolling interests
    
    
    (2,649
    )
    
    
    (2,810
    )
    
    
    (9,900
    )
    
    
    (5,002
    )Net (loss) income attributable to Retail
Ventures, Inc.
    
    $
    (32,956
    )
    
    $
    16,098
    
    
    $
    (14,129
    )
    
    $
    4,896
  F-45




---



##### Table of Contents



Thirteen weeks endedMay 2,
    
    
    August 1,
    
    
    October 31,
    
    
    January 30,Year ended January 30, 2010
    
    2009
    
    
    2009
    
    
    2009
    
    
    2010Basic and diluted (loss) earnings per share(1):Basic loss per share from continuing operations
attributable to Retail Ventures, Inc. common shareholders
    
    $
    (1.12
    )
    
    $
    (0.15
    )
    
    $
    (0.28
    )
    
    $
    (0.21
    )Diluted loss per share from continuing operations
attributable to Retail Ventures, Inc. common shareholders
    
    $
    (1.12
    )
    
    $
    (0.15
    )
    
    $
    (0.28
    )
    
    $
    (0.21
    )Basic earnings (loss) per share from continuing
operations attributable to Retail Ventures, Inc. common
shareholders
    
    $
    0.44
    
    
    $
    0.48
    
    
    $
    (0.01
    )
    
    $
    0.31Diluted earnings (loss) per share from discontinued
operations attributable to Retail Ventures, Inc. common
shareholders
    
    $
    0.44
    
    
    $
    0.48
    
    
    $
    (0.01
    )
    
    $
    0.31Basic (loss) earnings per share from discontinued
operations attributable to Retail Ventures, Inc. common
shareholders
    
    $
    (0.68
    )
    
    $
    0.33
    
    
    $
    (0.29
    )
    
    $
    0.10Diluted (loss) earnings per share attributable to Retail
Ventures, Inc. common shareholders
    
    $
    (0.68
    )
    
    $
    0.33
    
    
    $
    (0.29
    )
    
    $
    0.10
 (1)
    
    (Loss) earnings per share calculations for each quarter are based on the applicable weighted average
shares outstanding for each period and may not necessarily be equal
to the full year per share amount.  F-46




---



##### Table of Contents



Thirteen weeks endedMay 3,
    
    
    August 2,
    
    
    November 1,
    
    
    January 31,Year ended January 31, 2009
    
    2008
    
    
    2008
    
    
    2008
    
    
    2009Net sales
    
    $
    366,264
    
    
    $
    357,175
    
    
    $
    391,355
    
    
    $
    348,150Cost of sales (exclusive of depreciation included
below in selling, general and administrative expenses)
    
    
    (211,098
    )
    
    
    (198,515
    )
    
    
    (218,946
    )
    
    
    (213,034
    )Selling, general and administrative expenses
    
    
    (139,160
    )
    
    
    (140,981
    )
    
    
    (151,492
    )
    
    
    (146,905
    )Change in fair value of derivative instruments
    
    
    37,168
    
    
    
    16,733
    
    
    
    7,858
    
    
    
    23,476Operating profit
    
    
    53,174
    
    
    
    34,412
    
    
    
    28,775
    
    
    
    11,687Interest expense
    
    
    (3,541
    )
    
    
    (3,649
    )
    
    
    (3,241
    )
    
    
    (3,172
    )Interest income
    
    
    2,898
    
    
    
    2,676
    
    
    
    2,894
    
    
    
    2,801Interest expense, net
    
    
    (643
    )
    
    
    (973
    )
    
    
    (347
    )
    
    
    (371
    )Non-operating income (expense)
    
    
    
    
    
    
    
    
    
    
    1,486
    
    
    
    (1,134
    )Income from continuing operations before income taxes
    
    
    52,531
    
    
    
    33,439
    
    
    
    29,914
    
    
    
    10,182Income tax (expense) benefit
    
    
    (6,622
    )
    
    
    (7,617
    )
    
    
    (10,410
    )
    
    
    7,763Income from continuing operations
    
    
    45,909
    
    
    
    25,822
    
    
    
    19,504
    
    
    
    17,945(Loss) income from discontinued operations, net of tax
 Value City
    
    
    (3,621
    )
    
    
    10,494
    
    
    
    2,035
    
    
    
    4,315Loss from
discontinued operations, net of tax 
Filenes Basement
    
    
    (9,331
    )
    
    
    (14,628
    )
    
    
    (6,562
    )
    
    
    (31,081
    )Total loss from discontinued operations, net of tax
    
    
    (12,952
    )
    
    
    (4,134
    )
    
    
    (4,527
    )
    
    
    (26,766
    )Net income (loss)
    
    
    32,957
    
    
    
    21,688
    
    
    
    14,977
    
    
    
    (8,821
    )Less: net income attributable to the noncontrolling
interests
    
    
    (3,806
    )
    
    
    (3,954
    )
    
    
    (4,988
    )
    
    
    2,788Net income (loss) attributable to Retail Ventures, Inc.
    
    $
    29,151
    
    
    $
    17,734
    
    
    $
    9,989
    
    
    $
    (6,033
    )
  F-47




---



##### Table of Contents



Thirteen weeks endedMay 3,
    
    
    August 2,
    
    
    November 1,
    
    
    January 31,Year ended January 31, 2009
    
    2008
    
    
    2008
    
    
    2008
    
    
    2009Basic and diluted earnings (loss) per share(1):Basic earnings per share from continuing operations
attributable to Retail Ventures, Inc. common shareholders
    
    $
    0.87
    
    
    $
    0.45
    
    
    $
    0.30
    
    
    $
    0.43Diluted earnings per share from continuing operations
attributable to Retail Ventures, Inc. common shareholders
    
    $
    0.82
    
    
    $
    0.45
    
    
    $
    0.30
    
    
    $
    0.43Basic loss per share from discontinued operations
attributable to Retail Ventures, Inc. common shareholders
    
    $
    (0.27
    )
    
    $
    (0.08
    )
    
    $
    (0.09
    )
    
    $
    (0.55
    )Diluted loss per share from discontinued operations
attributable to Retail Ventures, Inc. common shareholders
    
    $
    (0.25
    )
    
    $
    (0.08
    )
    
    $
    (0.09
    )
    
    $
    (0.55
    )Basic earnings (loss) per share attributable to Retail
Ventures, Inc. common shareholders
    
    $
    0.60
    
    
    $
    0.36
    
    
    $
    0.21
    
    
    $
    (0.12
    )Diluted earnings (loss) per share attributable to Retail
Ventures, Inc. common shareholders
    
    $
    0.56
    
    
    $
    0.36
    
    
    $
    0.20
    
    
    $
    (0.12
    )
 (1)
    
    Earnings (loss) per share calculations for each quarter are based on the applicable weighted average
shares outstanding for each period and may not necessarily be equal to the full year per share amount. 17. SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION (in thousands)
 Fiscal Year EndedJanuary 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Cash paid during the period for:Interest to non related parties
    
    $
    9,523
    
    
    $
    9,358
    
    
    $
    9,523Income taxes
    
    $
    30,168
    
    
    $
    12,804
    
    
    $
    35,401Noncash investing and operating activities:Balance of accounts payable and accrued expenses due to
property and equipment purchases
    
    $
    1,962
    
    
    $
    3,282
    
    
    $
    11,895Capital contribution to subsidiary
    
    $
    4,670Additional paid in capital transferred from warrant
liability for warrant exercises
    
    
    
    
    
    
    
    
    
    $
    19,612Reclassification of SARs from non current liability to equity
    
    
    
    
    
    
    
    
    
    $
    1,934Issuance of VCHI Warrants
    
    
    
    
    
    
    
    
    
    $
    124
  F-48




---



##### Table of Contents



SCHEDULE I
 RETAIL VENTURES, INC. (Parent Company Only)
 
 CONDENSED BALANCE SHEETS
January 30, 2010 and January 31, 2009
(in thousands)
 January 30,
    
    
    January 31,2010
    
    
    2009ASSETSCash and equivalents
    
    $
    16,753
    
    
    $
    39,526Restricted cash
    
    
    
    
    
    
    261Accounts receivable, net
    
    
    1,102
    
    
    
    1,542Accounts receivable from related parties
    
    
    1,049
    
    
    
    1,582Prepaid expenses
    
    
    1,715
    
    
    
    2,458Other
    
    
    431
    
    
    
    367Current assets held for sale
    
    
    
    
    
    
    66,678Total current assets
    
    
    21,050
    
    
    
    112,414Property and equipment, net
    
    
    2,388
    
    
    
    2,989Investment in subsidiary
    
    
    327,460
    
    
    
    293,012Conversion feature of long-term debt
    
    
    28,029
    
    
    
    77,761Other assets
    
    
    2,259
    
    
    
    3,445Non current assets held for sale
    
    
    
    
    
    
    38,793Total assets
    
    $
    381,186
    
    
    $
    528,414
  S-1




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##### Table of Contents



SCHEDULE I
 RETAIL VENTURES, INC. (Parent Company Only)
CONDENSED BALANCE SHEETS (Continued)
January 30, 2010 and January 31, 2009
(in thousands)
 January 30,
    
    
    January 31,2010
    
    
    2009LIABILITIES AND SHAREHOLDERS EQUITYAccounts payable
    
    $
    973
    
    
    $
    177Accounts payable to related parties
    
    
    761
    
    
    
    2,411Accrued expenses:Guarantees from discontinued operations (a)
    
    
    2,800
    
    
    
    2,909Other
    
    
    6,515
    
    
    
    12,291Warrant liability
    
    
    23,068
    
    
    
    6,292Current maturities of long-term debt
    
    
    
    
    
    
    250Current liabilities held for sale
    
    
    
    
    
    
    76,030Total current liabilities
    
    
    34,117
    
    
    
    100,360Long-term obligations, net of current maturities (b)
    
    
    129,757
    
    
    
    127,576Other non current liabilities (c)
    
    
    8,802
    
    
    
    12,003Deferred income taxes
    
    
    2,641
    
    
    
    29,806Non current liabilities held for sale
    
    
    
    
    
    
    36,055Commitments and contingenciesShareholders equity:Common Shares, without par value; 160,000,000 authorized;
issued and outstanding, including 7,551 treasury shares,
48,964,530 and 48,691,280 outstanding, respectively
    
    
    313,147
    
    
    
    306,868Accumulated deficit
    
    
    (100,277
    )
    
    
    (77,585
    )Treasury shares, at cost, 7,551 shares
    
    
    (59
    )
    
    
    (59
    )Warrants
    
    
    
    
    
    
    124Accumulated other comprehensive loss
    
    
    (6,942
    )Accumulated other comprehensive loss held for sale
    
    
    
    
    
    
    (6,734
    )Total shareholders equity
    
    
    205,869
    
    
    
    222,614Total liabilities and shareholders equity
    
    $
    381,186
    
    
    $
    528,414
 (a)
    
    RVI completed the
disposition of an 81% ownership interest in its Value City business
segment on January 23, 2008, and on April 21, 2009, RVI
disposed of its Filenes Basement operations. As of
January 30, 2010, RVI had recorded a current liability of
$2.4 million for guarantees related to Value City and
$0.4 million for the guarantees of Filenes Basement. As of
January 31, 2009, RVI had recorded a current liability of
$2.9 million for guarantees related to Value City. See (c) below
and Note 13 of Notes to Consolidated Financial Statements in this
Annual Report on Form 10-K.(b)
    
    See Note 7 of Notes to
Consolidated Financial Statements in this Annual Report on Form 10-K.  S-2




---



##### Table of Contents



(c)
    
    Includes, as of
January 31, 2009, an estimated maximum potential liability of
$12.9 million, of which $2.9 million is classified as
short-term, for the guarantees of Value City commitments including,
but not limited to: amounts owed under certain guarantees with
various financing institutions for Value City inventory purchases
made prior to the disposition date; amounts owed for guaranteed
severance for certain Value City employees; amounts owed under lease
obligations for certain equipment leases; amounts owed under certain
employee benefit plans if the plans are not fully funded on a
termination basis; amounts owed for certain workers compensation
claims for events prior to the disposition date; amounts owed under
certain income tax liabilities and the guarantee of other amounts totaling $2.4 million.  S-3




---



##### Table of Contents



SCHEDULE I
 RETAIL VENTURES, INC. (Parent Company Only)
 
 CONDENSED STATEMENTS OF OPERATIONS
Years Ended January 30, 2010, January 31, 2009 and February 2, 2008
(in thousands)
 January 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Selling, general and administrative expenses
    
    $
    (66,800
    )Change in fair value of derivative instruments
    
    
    (66,499
    )
    
    $
    85,235
    
    
    $
    248,193Operating (loss) profit
    
    
    (133,299
    )
    
    
    85,235
    
    
    
    248,193Interest expense
    
    
    (12,218
    )
    
    
    (12,809
    )
    
    
    (12,718
    )Interest income
    
    
    71
    
    
    
    7,869
    
    
    
    11,483Interest (expense), net
    
    
    (12,147
    )
    
    
    (4,940
    )
    
    
    (1,235
    )Non-operating income, net
    
    
    
    
    
    
    1,486(Loss) income from continuing operations before income taxes
    
    
    (145,446
    )
    
    
    81,781
    
    
    
    246,958Income tax benefit (expense)
    
    
    25,095
    
    
    
    497
    
    
    
    (38,887
    )Equity in earnings of subsidiary, net of tax
    
    
    34,380
    
    
    
    16,942
    
    
    
    33,896(Loss) income from continuing operations
    
    
    (85,971
    )
    
    
    99,220
    
    
    
    241,967Income (loss) from discontinued operations, net of tax
    
    
    59,880
    
    
    
    (48,379
    )
    
    
    (190,525
    )Net (loss) income
    
    $
    (26,091
    )
    
    $
    50,841
    
    
    $
    51,442
  S-4




---



##### Table of Contents



SCHEDULE I
 RETAIL VENTURES, INC. (Parent Company Only)
 
 CONDENSED STATEMENTS OF CASH FLOWS
Years Ended January 30, 2010, January 31, 2009 and February 2, 2008
(in thousands)
 January 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Cash flows from operating activities:Net (loss) income
    
    $
    (26,091
    )
    
    $
    50,841
    
    
    $
    51,442Less: (Income) loss from discontinued operations, net of tax
    
    
    (59,880
    )
    
    
    48,379
    
    
    
    190,525(Loss) income before discontinued operations
    
    
    (85,971
    )
    
    
    99,220
    
    
    
    241,967Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities:Amortization of debt issuance costs and discount on debt
    
    
    3,412
    
    
    
    3,251
    
    
    
    3,221Stock based compensation expense
    
    
    997
    
    
    
    1,407
    
    
    
    947Capital transactions of subsidiary
    
    
    2,744
    
    
    
    2,806
    
    
    
    3,083Depreciation and amortization
    
    
    478
    
    
    
    2,130
    
    
    
    3,243Change in fair value of derivative instruments  related party
($6,910, ($30,009) and ($151,917))
    
    
    66,499
    
    
    
    (85,235
    )
    
    
    (248,193
    )Gain on the repurchase of the Premium Income Exchangeable Securities
    
    
    
    
    
    
    (1,486
    )Deferred income taxes and other non current liabilities
    
    
    (23,217
    )
    
    
    3,296
    
    
    
    53,326Loss on disposal of assets
    
    
    121
    
    
    
    559
    
    
    
    31Impairment charges on receivables from Filenes Basement
    
    
    57,884Other
    
    
    5,217
    
    
    
    (655
    )
    
    
    (3,121
    )Equity in earnings of subsidiary, net of tax
    
    
    (34,380
    )
    
    
    (16,942
    )
    
    
    (33,896
    )Change in working capital, assets and liabilities:Accounts receivable
    
    
    1,693
    
    
    
    (3,679
    )
    
    
    435Prepaid expenses and other assets
    
    
    698
    
    
    
    438
    
    
    
    (1,179
    )Accounts payable
    
    
    (2,381
    )
    
    
    (492
    )
    
    
    (3,265
    )Accrued expenses
    
    
    (17,122
    )
    
    
    (4,754
    )
    
    
    (17,393
    )Net cash (used in) provided by operating activities from continuing
operations
    
    
    (23,328
    )
    
    
    (136
    )
    
    
    (794
    )Net cash provided by (used in) operating activities from
discontinued operations
    
    
    20,563
    
    
    
    (13,984
    )
    
    
    21,897Cash flows from investing activities:Transfer of property and equipment to subsidiary
    
    
    
    
    
    
    2,540
    
    
    
    605Transfer of cash from restricted cash
    
    
    10,261Transfer of cash to restricted cash
    
    
    (10,000
    )
    
    
    (4
    )
    
    
    (257
    )Investment in subsidiary
    
    
    (68
    )
    
    
    (2,940
    )
    
    
    (3,083
    )Net cash
provided by (used in) investing activities from continuing operations
    
    
    193
    
    
    
    (404
    )
    
    
    (2,735
    )Net cash used in investing activities from discontinued operations
    
    
    (158
    )
    
    
    (4,014
    )
    
    
    (17,731
    )
  S-5




---



##### Table of Contents



SCHEDULE I
 RETAIL VENTURES, INC. (Parent Company Only)
CONDENSED STATEMENTS OF CASH FLOWS (Continued)
Years Ended January 30, 2010, January 31, 2009 and February 2, 2008
(in thousands)
 January 30,
    
    
    January 31,
    
    
    February 2,2010
    
    
    2009
    
    
    2008Cash flows from financing activities:Payment of current maturities on long-term obligations
    
    
    (250
    )Payments on notes to discontinued operations
    
    
    
    
    
    
    
    
    
    
    (25,000
    )Repurchase of Premium Income Exchangeable Securities
    
    
    
    
    
    
    (5,600
    )Proceeds from exercise of warrants
    
    
    
    
    
    
    
    
    
    
    6,000Proceeds from exercise of stock options
    
    
    612
    
    
    
    207
    
    
    
    71Net cash provided by (used in) financing activities from continuing
operations
    
    
    362
    
    
    
    (5,393
    )
    
    
    (18,929
    )Net cash (used in) provided by financing activities from
discontinued operations
    
    
    (25,181
    )
    
    
    17,083
    
    
    
    (17,574
    )Net decrease in cash and equivalents from continuing operations
    
    $
    (22,773
    )
    
    $
    (5,933
    )
    
    $
    (22,458
    )Cash and equivalents from continuing operations, beginning of year
    
    
    39,526
    
    
    
    45,459
    
    
    
    67,917Cash and equivalents from continuing operations, end of year
    
    $
    16,753
    
    
    $
    39,526
    
    
    $
    45,459Net decrease in cash and equivalents from discontinued operations
    
    $
    (4,776
    )
    
    $
    (915
    )
    
    $
    (13,408
    )Cash and equivalents from discontinued operations, beginning of year
    
    
    4,776
    
    
    
    5,691
    
    
    
    19,099Cash and equivalents from discontinued operations, end of year
    
    $
    
    
    
    $
    4,776
    
    
    $
    5,691
  S-6




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##### Table of Contents



ExhibitNo.
    
    Description2.1
    
    
    Agreement and Plan of Merger among Value City Department Stores, Inc., Retail Ventures, Inc. (the Company)
and Value City Merger Sub, Inc., effective as of October 8, 2003. Incorporated by reference to Exhibit 2 to
Form 8-K (file no. 1-10767) filed on October 8, 2003.2.2
    
    
    Purchase Agreement, dated as of January 23, 2008, by and between Retail Ventures, Inc. and VCHI Acquisition
Co. Incorporated herein by reference to Exhibit 2.1 to Form 8-K (file no 1-10767) filed January 24, 2008.2.3
    
    
    Purchase Agreement, dated as of April 21, 2009 by and between Retail Ventures, Inc. and FB II Acquisition
Corp. Incorporated herein by reference to Exhibit 2.1 to Form 8-K (file no 1-10767) filed April 27, 2009.3.1
    
    
    Amended Articles of Incorporation of the Company. Incorporated by reference to Exhibit 3(a) to Form 8-K (file
No. 1-10767) filed on October 8, 2003.3.2
    
    
    Amended Code of Regulations of the Company. Incorporated by reference to Exhibit 3(b) to Form 8-K (file No.
1-10767) filed on October 8, 2003.4.1
    
    
    Amended Common Stock Purchase Warrant issued by Retail Ventures, Inc. to Cerberus Partners, L.P. Incorporated
by reference to Exhibit 4.1 to Form 8-K (file no. 1-10767) filed October 19, 2005.4.2
    
    
    Amended Common Stock Purchase Warrant issued by Retail Ventures, Inc. to Schottenstein Stores Corporation.
Incorporated by reference to Exhibit 4.2 to Form 8-K (file no. 1-10767) filed October 19, 2005.4.3
    
    
    Form of Term Loan Warrant issued by Retail Ventures, Inc. to Millennium Partners, L.P. Incorporated by
reference to Exhibit 4.1 to Form 10-Q (file no. 1-10767) filed December 8, 2005.4.4
    
    
    Form of Conversion Warrant issued by Retail Ventures, Inc. issued to Cerberus Partners, L.P. and
Schottenstein Stores Corporation. Incorporated by reference to Exhibit 4.1 to Form 8-K (file no. 1-10767)
filed July 11, 2005.4.5
    
    
    Exchange Agreement, dated July 5, 2005, between Retail Ventures, Inc. and DSW Inc. Incorporated by reference
to Exhibit 10.4 to Form 8-K (file no. 1-10767) filed July 11, 2005.4.6
    
    
    Second Amended and Restated Registration Rights Agreement, dated July 5, 2005, among Retail Ventures, Inc.,
Cerberus Partners, L.P., Schottenstein Stores Corporation and Back Bay Capital Funding LLC. Incorporated by
reference to Exhibit 4.2 to Form 8-K (file no. 1-10767) filed July 11, 2005.4.7
    
    
    Specimen of Common Share Certificate. Incorporated by reference to Exhibit 4.7 to Form 10-K (file no.
1-10767) filed April 13, 2006.4.8
    
    
    Indenture, dated as of August 16, 2006, by and between Retail Ventures, Inc. and HSBC Bank USA, National
Association, as indenture trustee (Form of 6.625% Mandatorily Exchangeable Notes Due September 15, 2011 filed
as Exhibit A thereto). Incorporated by reference to Exhibit 4.1 to Form 8-K (file no. 001-10767) filed on
August 22, 2006.4.9
    
    
    Collateral Agreement, dated as of August 16, 2006, by and between Retail Ventures, Inc., as pledgor, and HSBC
Bank USA, National Association, as collateral agent, indenture trustee and securities intermediary.
Incorporated by reference to Exhibit 4.2 to Form 8-K (file no. 001-10767) filed on August 22, 2006.4.10
    
    
    Form of Exchange Request by Retail Ventures, Inc. to DSW Inc. Incorporated by reference to Exhibit 4.5 to
Registration Statement on Form S-3/A (file no. 333-134225) filed on July 17, 2006.4.11
    
    
    Pledge Agreement, dated as of August 16, 2006, made by Retail Ventures, Inc. with and in favor of Cerberus
Partners, L.P. Incorporated by reference to Exhibit 10.4 to Form 8-K (file no. 001-10767) filed on August
22, 2006.4.12
    
    
    Pledge Agreement, dated as of August 16, 2006, made by Retail Ventures, Inc. with and in favor of
Schottenstein Stores Corporation. Incorporated by reference to Exhibit 10.5 to Form 8-K (file no. 001-10767)
filed on August 22, 2006.4.13
    
    
    Common Stock Purchase Warrant, dated January 23, 2008, issued by Retail Ventures, Inc. to VCHI Acquisition
Co. Incorporated by reference to Exhibit 4.13 to Form 10-K (file no. 1-10767) filed April 25, 2008.10.1
    
    
    Corporate Services Agreement, dated June 12, 2002, between the Company and SSC. Incorporated by reference to
Exhibit 10.6 to Form 10-Q (file no. 1-10767) filed June 18, 2002.
  E-1




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##### Table of Contents



ExhibitNo.
    
    Description10.1.1
    
    
    Amendment to Corporate Services Agreement, dated July 5, 2005, among Schottenstein Stores Corporation, Retail
Ventures, Inc. and Schottenstein Management Company, together with Side Letter Agreement, dated July 5, 2005,
among DSW Inc., Schottenstein Stores Corporation, Retail Ventures, Inc. and Schottenstein Management Company.
Incorporated by reference to Exhibit 10.5 to Form 8-K (file no. 1-10767) filed July 11, 2005.10.3
    
    
    Master Separation Agreement, dated July 5, 2005, between Retail Ventures, Inc. and DSW Inc. Incorporated by
reference to Exhibit 10.1 to Form 8-K (file no. 1-10767) filed July 11, 2005.10.4
    
    
    Amended and Restated Shared Services Agreement, dated as of October 29, 2006, between Retail Ventures, Inc.
and DSW Inc. Incorporated by reference to Exhibit 10.8 to form 10-Q (file no. 1-10767) filed December 6.
2006.10.4.1
    
    
    Amendment No. 1 to Amended and Restated Shared Services Agreement between DSW, Inc. and Retail Ventures,
Inc., dated as of March 17, 2008. Incorporated by reference to Exhibit 10.2 to Form 8-K (file no. 1-10767)
filed August 28, 2008.10.5
    
    
    Tax Separation Agreement, dated July 5, 2005, among Retail Ventures, Inc. and its affiliates and DSW Inc. and
its affiliates. Incorporated by reference to Exhibit 10.3 to Form 8-K (file no. 1-10767) filed July 11, 2005.10.5.1
    
    
    Amendment No. 1 to Tax Separation Agreement between DSW Inc. and Retail Ventures, Inc., dated as of March 17,
2008. Incorporated by reference to Exhibit 10.3 to Form 8-K (file no. 1-10767) filed August 28, 2008.10.7
    #
    
    Form of Indemnification Agreement entered into on December 22, 2005 between Retail Ventures, Inc. and each of
its directors and executive officers. Incorporated by reference to Exhibit 10.1 to Form 8-K (file no.
1-10767) filed December 23, 2005.10.18
    #
    
    Form of Restricted Stock Agreement between the Company and certain employees. Incorporated by reference to
Exhibit 10.27 to Amendment No. 1 to Form S-1 Registration Statement (file no. 33-47252) filed April 27, 1992.10.32
    
    
    Industrial Space Lease-Net, dated March 22, 2000, between 4300 East Fifth Avenue, LLC, an affiliate of SSC,
as landlord, and Shonac Corporation, as tenant, re: Building 6, Columbus International Aircenter, Columbus,
OH. Incorporated by reference to Exhibit 10.60 to Form 10-K (file no. 1-10767) filed April 28, 2000.10.33
    
    
    Lease, dated August 30, 2002, by and between Jubilee Limited Partnership, an affiliate of SSC, and Shonac
Corporation, re: Troy, MI DSW store. Incorporated by reference to Exhibit 10.44 to Form 10-K (file no.
1-10767) filed April 29, 2004.10.33.1
    
    
    Assignment and Assumption Agreement, dated October 23, 2002, between Shonac Corporation, as assignor, and DSW
Shoe Warehouse, Inc., as assignee, re: Troy, MI DSW store. Incorporated by reference to Exhibit 10.29.1 to
Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.34
    
    
    Lease, dated October 8, 2003, by and between Jubilee Limited Partnership, an affiliate of SSC, and Shonac
Corporation, re: Denton, TX DSW store. Incorporated by reference to Exhibit 10.46 to Form 10-K (file no.
1-10767) filed April 29, 2004.10.34.1
    
    
    Assignment and Assumption Agreement, dated December 18, 2003 between Shonac Corporation, as assignor, and DSW
Shoe Warehouse, Inc., as assignee, re: Denton, TX DSW store. Incorporated by reference to Exhibit 10.30.1 to
Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.34.2
    *
    
    Lease Amendment, dated February 1, 2010 between Jubilee Limited Partnership, an affiliate of Schottenstein
Stores Corporation, and DSW Shoe Warehouse, Inc. re: Denton, TX DSW store.10.35
    
    
    Lease, dated October 28, 2003, by and between JLP-RICHMOND LLC, an affiliate of SSC, and Shonac Corporation,
re: Richmond, VA DSW store. Incorporated by reference to Exhibit 10.47 to Form 10-K (file no. 1-10767) filed
April 29, 2004.10.35.1
    
    
    Assignment and Assumption Agreement, dated December 18, 2003, between Shonac Corporation, as assignor, and
DSW Shoe Warehouse, Inc., as assignee, re: Richmond, VA DSW store. Incorporated by reference to Exhibit
10.31.1 to Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.36
    #
    
    Employment Agreement, dated June 21, 2000, between James A. McGrady and the Company. Incorporated by
reference to Exhibit 10.46 (also listed as Exhibit 10.61) to Form 10-K (file no. 1-10767) filed May 4, 2001.10.36.1
    #
    
    Amendment to June 22, 2000 employment agreement between the Company and James A. McGrady effective June 22,
2008. Incorporated by reference to Exhibit 10.1 to Form 8-K (file no. 1-10767) filed July 3, 2008.
  E-2




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##### Table of Contents



ExhibitNo.
    
    Description10.37
    #
    
    Employment Agreement, dated as of April 29, 2004, between Julia A. Davis and the Company. Incorporated by
reference to Exhibit 10.51 to Form 10-K (file no. 1-10767) filed April 29, 2004.10.42
    #
    
    Employment Agreement, effective November 1, 2004, between Retail Ventures, Inc. and Heywood Wilansky.
Incorporated by reference to Exhibit 10.1 to Form 8-K/A (file no. 1-10767) filed November 24, 2004.10.42.1
    #
    
    Amendment to November 1, 2004 employment agreement between the Company and Heywood Wilansky effective
December 9, 2008. Incorporated by reference to Exhibit 10.1 to Form 8-K (file no. 1-10767) filed December
15, 2008.10.43
    #
    
    Employment Agreement, effective October 10, 2003, between Value City Department Stores, Inc. and Steven E.
Miller. Incorporated by reference to Exhibit 10.43 to Form 10-K (file no. 1-10767) filed April 14, 2005.10.47
    
    
    Sublease, dated May 2000, by and between SSC, as sublessor, and Shonac Corporation dba DSW Shoe Warehouse, as
sublessee, re: Pittsburgh, PA DSW store. Incorporated by reference to Exhibit 10.48 to Form 10-K (file no.
1-10767) filed April 14, 2005.10.47.1
    
    
    Assignment and Assumption Agreement, dated January 8, 2001, between Shonac Corporation, as assignor, and DSW
Shoe Warehouse, Inc., as assignee, re: 451 Clariton Boulevard, Pittsburgh, PA DSW store. Incorporated by
reference to Exhibit 10.48.1 to Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.48
    
    
    Lease, dated May 2000, by and between Jubilee-Richmond LLC, an affiliate of SSC, and DSW Shoe Warehouse, Inc.
(as assignee of Shonac Corporation), re: Glen Allen, VA DSW store. Incorporated by reference to Exhibit 10.49
to Form 10-K (file no. 1-10767) filed April 14, 2005.10.49
    
    
    Lease, dated February 28, 2001, by and between Jubilee-Springdale, LLC, an affiliate of SSC, and Shonac
Corporation dba DSW Shoe Warehouse, re: Springdale, OH DSW store. Incorporated by reference to Exhibit 10.50
to Form 10-K (file no. 1-10767) filed April 14, 2005.10.49.1
    
    
    Assignment and Assumption Agreement, dated May 11, 2001, between Shonac Corporation, as assignor, and DSW
Shoe Warehouse, Inc., as assignee, re: Springdale, OH DSW store. Incorporated by reference to Exhibit 10.50.1
to Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.50
    
    
    Agreement of Lease, dated 1997, between Shoppes of Beavercreek Ltd., an affiliate of SSC, and Shonac
Corporation (assignee of SSC d/b/a Value City Furniture through Assignment of Tenants Leasehold Interest and
Amendment No. 1 to Agreement of Lease, dated February 28, 2001), re: Beavercreek, OH DSW store. Incorporated
by reference to Exhibit 10.51 to Form 10-K (file no. 1-10767) filed April 14, 2005.10.50.1
    
    
    Assignment and Assumption Agreement, dated May 11, 2001, between Shonac Corporation, as assignor, and DSW
Shoe Warehouse, Inc., as assignee, re: Beavercreek, OH DSW store. Incorporated by reference to Exhibit
10.51.1 to Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.51
    
    
    Lease, dated February 28, 2001, by and between JLP-Chesapeake, LLC, an affiliate of SSC, and Shonac
Corporation, re: Chesapeake, VA DSW store. Incorporated by reference to Exhibit 10.52 to Form 10-K (file no.
1-10767) filed April 14, 2005.10.51.1
    
    
    Assignment and Assumption Agreement, dated May 11, 2001, between Shonac Corporation, as assignor, and DSW
Shoe Warehouse, Inc., as assignee, re: Chesapeake, VA DSW store. Incorporated by reference to Exhibit 10.52.1
to Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.52
    
    
    Ground Lease Agreement, dated April 30, 2002, by and between Polaris Mall, LLC, a Delaware limited liability
company, and SSC-Polaris LLC, an affiliate of SSC, as modified by Sublease agreement, dated April 30, 2002,
by and between SSC-Polaris LLC, as sublessor, and DSW Shoe Warehouse, Inc. as sublease (assignee of Shonac
Corporation), re: Columbus, OH (Polaris) DSW store. Incorporated by reference to Exhibit 10.53 to Form 10-K
(file no. 1-10767) filed April 14, 2005.10.52.1
    
    
    Assignment and Assumption Agreement, dated August 6, 2002, between Shonac Corporation, as assignor, and DSW
Shoe Warehouse, Inc., as assignee, re: Columbus, OH (Polaris) DSW store. Incorporated by reference to Exhibit
10.53.1 to Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.53
    
    

Lease, dated August 30, 2002, by and between JLP-Cary LLC, an affiliate of SSC, and Shonac Corporation, re: Cary, NC DSW store. Incorporated by reference to Exhibit 10.54 to Form 10-K (file no. 1-10767) filed April
14, 2005.10.53.1
    
    
    Assignment and Assumption Agreement, dated October 23, 2002, between Shonac Corporation, as assignor and DSW
Shoe Warehouse, Inc., as assignee, re: Cary, NC DSW store. Incorporated by reference to Exhibit 10.54.1 to
Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.
  E-3




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##### Table of Contents



ExhibitNo.
    
    Description10.54
    
    
    Lease, dated August 30, 2002, by and between JLP-Madison LLC, an affiliate of SSC, and Shonac Corporation,
re: Madison, TN DSW store. Incorporated by reference to Exhibit 10.55 to Form 10-K (file no. 1-10767) filed
April 14, 2005.10.54.1
    
    
    Assignment and Assumption Agreement, dated October 23, 2002, between Shonac Corporation, as assignor, and DSW
Shoe Warehouse, Inc., as assignee, re: Madison, TN DSW store. Incorporated by reference to Exhibit 10.55.1 to
Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.55
    
    
    Lease, dated July 19, 2000, by and between Jubilee Limited Partnership, an affiliate of SSC, and Value City
Department Stores, Inc., as modified by Lease Modification Agreement, dated November 2, 2000, re: 3704 W.
Dublin-Granville Rd., Columbus, OH DSW/Filenes combo store. Incorporated by reference to Exhibit 10.56 to
Form 10-K (file no. 1-10767) filed April 14, 2005.10.55.1
    
    
    Assignment and Assumption of Lease Agreement, dated January 22, 2008, between Value City Department Stores
LLC, Retail Ventures, Inc. and Jubilee-Sawmill LLC, an affiliate of SSC, re: 3704 W. Dublin-Granville Rd.,
Columbus, OH DSW/Filenes combo store. Incorporated by reference to Exhibit 10.55.1 to Form 10-K (file no.
1-10767) filed April 25, 2008.10.57
    
    
    Lease, dated September 24, 2004, by and between K&S Maple Hill Mall, L.P., an affiliate of SSC, and Shonac
Corporation, re: Kalamazoo, MI DSW store. Incorporated by reference to Exhibit 10.58 to Form 10-K (file no.
1-10767) filed April 14, 2005.10.57.1
    
    
    Assignment and Assumption Agreement, dated February 28, 2005, between Shonac Corporation, as assignor, and
DSW Shoe Warehouse, Inc., as assignee, re: Kalamazoo, MI DSW store. Incorporated by reference to Exhibit
10.58.1 to Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.58
    
    
    Lease, dated November 2004, by and between KSK Scottsdale Mall, L.P., an affiliate of SSC, and Shonac
Corporation, re: South Bend, IN DSW store. Incorporated by reference to Exhibit 10.59 to Form 10-K (file no.
1-10767) filed April 14, 2005.10.58.1
    
    
    Assignment and Assumption Agreement, dated March 18, 2005, between Shonac Corporation, as assignor, and DSW
Shoe Warehouse, Inc., as assignee, re: South Bend, IN DSW store. Incorporated by reference to Exhibit 10.59.1
to Form 10-K/A Amendment No. 2 (file no. 1-10767) filed May 12, 2005.10.58.2
    *
    
    Lease Amendment, dated February 1, 2010, between Shonac Corporation, as assignor, and DSW Shoe Warehouse,
Inc., as assignee, re: South Bend, IN DSW store. Incorporated by reference to Exhibit 10.59.1 to Retail
Ventures Form 10-K/A (file no. 1-10767) filed May 12, 2005.10.61
    #
    
    Sample Nonqualified Stock Option Award Agreement issued by the Company pursuant to the 2000 Stock Incentive
Plan. Incorporated by reference to Exhibit 10.62 to Form 10-K (file no. 1-10767) filed April 14, 2005.10.62
    #
    
    Sample Price Protected Stock Option Award Agreement issued by the Company pursuant to the 2000 Stock
Incentive Plan. Incorporated by reference to Exhibit 10.63 to Form 10-K (file no. 1-10767) filed April 14,
2005.10.63
    #
    
    Sample Equity Compensation Approval Notice and Agreement issued by the Company to certain employees.
Incorporated by reference to Exhibit 10.64 to Form 10-K (file no. 1-10767) filed April 14, 2005.10.65
    #
    
    Form of Indemnification Agreement between the Company and its directors and officers. Incorporated by
reference to Exhibit 10(b) to Registration Statement on Form S-8 (file no. 333-117341) filed July 13, 2004.10.68
    
    
    Agreement of Sublease, dated June 12, 2000, between Jubilee Limited Partnership, an affiliate of SSC, and DSW
Shoe Warehouse, Inc. (assignee of DSW Inc.), re: Baileys Crossroads, VA DSW Store. Incorporated by reference
to Exhibit 10.1 to Form 10-Q (file no. 1-10767) filed June 9, 2005.10.71
    #
    
    Employment Agreement, effective as of January 29, 2006, by and between Jed L. Norden and the Company.
Incorporated by reference to Exhibit 10.1 to Form 8-K (file no. 1-10767) filed February 2, 2006.10.72
    
    
    Agreement of Lease, dated April 7, 2006, by and between JLP  Harvard Park, LLC, an affiliate of SSC, as
landlord, and DSW Inc., as tenant, re: Chagrin Highlands, Warrensville, Ohio DSW store. Incorporated by
reference to Exhibit 10.72 to Form 10-K (file no. 1-10767) filed April 13, 2006.10.74
    #
    
    Summary of Director Compensation. Incorporated by reference to Exhibit 10.74 to Form 10-K (file no. 1-10767)
filed April 13, 2006.10.75
    
    
    Loan and Security Agreement, between DSW Inc. and DSW Shoe Warehouse, Inc., as the Borrowers, and National
City Business Credit, Inc., as Administrative Agent and Collateral Agent for the Revolving Credit Lenders.
Incorporated by reference to Exhibit 10.11 to DSW Inc.s Form 10-K (file no. 001-32545) filed on April 13,
2006.
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##### Table of Contents



ExhibitNo.
    
    Description10.75.1
    *
    
    First Amendment, dated January 6, 2010, to the Loan and Security Agreement, between DSW Inc. and DSW Shoe
Warehouse, Inc., as the Borrowers, and National City Business Credit, Inc., as Administrative Agent and
Collateral Agent for the Revolving Credit Lenders.10.76
    
    
    Agreement of Lease, dated April 13, 2006, between JLP  Harvard Park, LLC, an affiliate of SSC, as landlord,
and Filenes Basement, Inc. as tenant, re: Chagrin, OH Filenes Basement store. Incorporated by reference to
Exhibit 10.1 to Form 10-Q (file no. 1-10767) filed June 8, 2006.10.77
    
    
    Agreement of Lease, dated June 30, 2006, between JLPK  Levittown NY LLC, an affiliate of Schottenstein
Stores Corporation and DSW Inc., re: Levittown, NY DSW store. Incorporated by reference to Exhibit 10.1 to
Form 10-Q (file no. 1-10767) filed December 6, 2006.10.78
    
    
    Agreement of Lease, dated November 27, 2006, between JLP  Lynnhaven VA LLC, an affiliate of Schottenstein
Stores Corporation and DSW Inc., re: Lynnhaven, Virginia DSW store. Incorporated by reference to Exhibit 10.2
to Form 10-Q (file no. 1-10767) filed December 6, 2006.10.79
    
    
    Agreement of Lease, dated November 30, 2006, between 4300 Venture 34910 LLC, an affiliate of Schottenstein
Stores Corporation, and DSW Inc., re: Home office. Incorporated by reference to Exhibit 10.3 to Form 10-Q
(file no. 1-10767) filed December 6, 2006.10.80
    
    
    Agreement of Lease, dated November 30, 2006, between 4300 East Fifth Avenue LLC, an affiliate of
Schottenstein Stores Corporation, and DSW Inc., re: Trailer Parking spaces for home office. Incorporated by
reference to Exhibit 10.4 to Form 10-Q (file no. 1-10767) filed December 6, 2006.10.81
    
    
    Lease Amendment, dated November 30, 2006 between 4300 Venture 6729 LLC, an affiliate of Schottenstein Stores
Corporation, and DSW Inc., re: warehouse and corporate headquarters. Incorporated by reference to Exhibit
10.5 to Form 10-Q (file no. 1-10767) filed December 6, 2006.10.82
    
    
    Agreement of Lease, dated June 30, 2006, between JLPK  Levittown NY LLC, an affiliate of Schottenstein
Stores Corporation and Filenes Basement, re: Levittown, NY Filenes Basement store. Incorporated by
reference to Exhibit 10.6 to Form 10-Q (file no. 1-10767) filed December 6, 2006.10.83
    
    
    IT Transfer and Assignment Agreement dated October 29, 2006. Incorporated by reference to Exhibit 10.7 to
Form 10-Q (file no. 1-10767) filed December 6, 2006.10.84
    
    
    Agreement of Lease, dated December 15, 2006, between American Signature, Inc., an affiliate of SSC, and DSW
Shoe Warehouse, Inc., re: Langhorne, Pennsylvania DSW store. Incorporated herein by reference to Exhibit
10.84 to Form 10-K (file no. 1-10767) filed April 5, 2007.10.85
    #
    
    Sample Restricted Stock Unit Award Agreement issued by the Company to certain employees. Incorporated herein
by reference to Exhibit 10.85 to Form 10-K (file no. 1-10767) filed April 5, 2007.10.86
    #
    
    Sample Stock Appreciation Right Award Agreement issued by the Company to certain employees. Incorporated
herein by reference to Exhibit 10.86 to Form 10-K (file no. 1-10767) filed April 5, 2007.10.87
    
    
    Agreement of Lease, dated July 9, 2007, between Jubilee Limited Partnership, an affiliate of Schottenstein
Stores Corporation, and Filenes Basement, re: Aventura, FL Filenes Basement store. Incorporated herein by
reference to Exhibit 10.1 to Form 10-Q (file no. 1-10767) filed September 13, 2007.10.88
    
    
    Second Amended and Restated Senior Loan and Security Agreement, dated as of January 23, 2008, by and among
Filenes Basement, as borrower, the revolving credit lenders party thereto and National City Business Credit,
Inc. as administrative agent and collateral agent. Incorporated herein by reference to Exhibit 10.1 to Form
8-K (file no. 1-10767) filed on January 24, 2008.10.88.1
    
    
    First Amendment to Second Amended and Restated Loan and Security Agreement entered into by and among Filenes
Basement, Inc., National City Business Credit, Inc., Wells Fargo Retail Finance LLC and Wachovia Capital
Finance Corporation (Central) on September 12, 2008. Incorporated herein by reference to Exhibit 10.1 to
Form 8-K (file no. 1-10767) filed September 18, 2008.10.88.2
    
    
    Second Amendment to Second Amended and Restated Loan and Security Agreement entered into by and among
Filenes Basement, Inc., National City Business Credit, Inc., Wells Fargo Retail Finance, LLC and Wachovia
Capital Finance Corporation (Central) on February 11, 2009. Incorporated herein by reference to Exhibit 10.1
to Form 8-K (file no. 1-10767) filed February 13, 2009.
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##### Table of Contents



ExhibitNo.
    
    Description10.89
    
    
    Agreement to Acquire Leases and Lease Properties, dated October 3, 2007. Incorporated herein by reference to
Exhibit 10.1 to Form 8-K (file no. 1-10767) filed October 4, 2007.10.89.1
    
    
    First Amendment to Agreement to Acquire Leases and Lease Properties, dated effective as of February 15, 2008.
Incorporated herein by reference to Exhibit 10.1 to Form 8-K (file no. 1-10767) filed January 28, 2008.10.90
    #
    
    2007 Retail Ventures, Inc. Cash Incentive Compensation Plan. Incorporated by reference to Exhibit 10.90 to
Form 10-K (file no. 1-10767) filed April 25, 2008.10.93
    
    
    Last Out Participation Agreement entered into by and among National City Business Credit, Inc. and Retail
Ventures, Inc. on February 11, 2009. Incorporated herein by reference to Exhibit 10.2 to Form 8-K (file no.
1-10767) filed February 13, 2009.10.94
    #
    
    Second Amended and Restated Retail Ventures, Inc. 1991 Stock Option Plan. Incorporated
by reference to Exhibit 10.94 to Form 10-K (file no. 1-10767) filed April 30, 2009.10.95
    #
    
    Retail Ventures, Inc. Second
Amended and Restated 2000 Stock Incentive Plan (the 2000 Stock Incentive Plan). Incorporated by
reference to Exhibit 10.95 to Form 10-K (file no. 1-10767) filed April 30, 2009.10.96
    #
    
    Second Amended and Restated
Retail Ventures, Inc. Non-Employee Director Stock Option Plan. Incorporated by reference to
Exhibit 10.96 to Form 10-K (file no. 1-10767) filed April 30, 2009.10.97
    
    
    Second Amended and Restated
Guaranty, dated as of January 23, 2008, by and among Retail Ventures, Inc., Retail Ventures
Services, Inc., Retail Ventures Licensing, Inc. and Retail Ventures Imports, Inc., as guarantors,
the revolving credit lenders party thereto and National City Business Credit, Inc., as
administrative and collateral agent. Incorporated by reference to Exhibit 10.97 to Form 10-K
(file no. 1-10767) filed April 30, 2009.10.98
    
    
    Consent and Ratification Agreement, dated as of April 21, 2009, by and among Filenes Basement, Inc. as
borrower, Retail Ventures, Inc., FB II Acquisition Corp. as purchaser, the revolving credit lenders party
thereto and National City Business Credit, Inc., as administrative and collateral agent. Incorporated herein
by reference to Exhibit 10.1 to Form 8-K (file no 1-10767) filed April 27, 2009.10.99
    
    
    Sub-license Agreement between
Retail Ventures Licensing, Inc. and Filenes Basement, Inc., effective January 23, 2008.
Incorporated by reference to Exhibit 10.99 to Form 10-K (file no. 1-10767) filed April 30, 2009.10.100
    
    
    Agreement of Lease, dated October 1, 2007, between 4300 Venture 34910 LLC, an affiliate of Schottenstein
Stores Corporation and eTailDirect LLC re: fulfillment center. Incorporated by reference to Exhibit 10.1 to
Form 8-K (file no. 1-32545) filed March 6, 2008.10.100.1
    
    
    Lease Amendment to Agreement of Lease, dated September 29, 2009, between 4300 Venture 34910 LLC, an affiliate
of Schottenstein Stores Corporation and eTailDirect LLC re: fulfillment center. Incorporated by reference to
Exhibit 10.1 to Form 10-Q (file no. 1-32545) filed December 3, 2009.10.101
    
    
    Settlement Agreement, dated as of September 25, 2009, by and among Retail Ventures, Inc., DSW Inc., FB
Liquidating Estate, Inc., FB Services LLC, FB Leasing Services LLC and the Official Committee of Unsecured
Creditors. Incorporated herein by reference to Exhibit 10.2 to Form 10-Q (file no. 1-10767) filed December
15, 2009.10.102
    #*
    
    Retail Ventures, Inc. Restricted Stock Award Agreement dated February 22, 2010, with James A. McGrady.10.103
    #*
    
    Retail Ventures, Inc. Restricted Stock Award Agreement dated February 22, 2010, with Julia A. Davis.12
    *
    
    Ratio of Earnings to Fixed Charges.21
    *
    
    List of Subsidiaries.23
    *
    
    Consent of Independent Registered Public Accounting Firm.24
    *
    
    Power of Attorney.31.1
    *
    
    Rule 13a-14(a)/15d-14(a) Certification  Principal Executive Officer.31.2
    *
    
    Rule 13a-14(a)/15d-14(a) Certification  Principal Financial Officer.32.1
    *
    
    Section 1350 Certification  Principal Executive Officer.32.2
    *
    
    Section 1350 Certification  Principal Financial Officer.
 
 *
    
    Filed herewith.#
    
    Management contract or compensatory plan or arrangement.  E-6