Document:

EX-10.7

 

Exhibit
10.7

TRANSFER AND ASSIGNMENT AGREEMENT

          TRANSFER AND ASSIGNMENT AGREEMENT (this “Agreement”), dated as of October 29, 2006, by and
among Brand Technology Services LLC, an Ohio limited liability company (“Buyer”) and wholly owned
subsidiary of DSW Inc. (“DSW”), and Retail Ventures, Inc., an Ohio corporation (“RVI”), Retail
Ventures Services, Inc., an Ohio corporation (“RVSI”) and wholly owned subsidiary of Retail
Ventures Inc., Filene’s Basement, Inc., a Delaware corporation (“FB”) and wholly owned subsidiary
of RVI, and Value City Department Stores LLC, an Ohio limited liability company (“VC”) and a wholly
owned subsidiary of RVI (RVI, RVSI, FB, and VC, collectively, “Seller” or “RVI Entities”).

          WHEREAS, Sellers currently provide certain services on behalf of or for DSW and its
subsidiaries, including information technology services, pursuant to a Shared Services Agreement
entered into effective as of January 30, 2005, by and between DSW and RVI (the “Shared Services
Agreement”);

          WHEREAS, Sellers desire to transfer certain information technology agreements to Buyer and
Buyer desires to assume such information technology contracts;

          WHEREAS, Sellers desire to employ certain employees of Sellers currently engaged in providing
information technology services;

          WHEREAS, following the consummation of the transactions contemplated by this Agreement, Buyer
desires to provide certain information technology services on behalf of or for RVI and its
subsidiaries;

          WHEREAS, the RVI Entities have the expectation that Buyer will make investments into
information technology services and to more efficiently operate such assets, such that the RVI
Entities and Buyer will receive enhanced information technology services; and

          WHEREAS, capitalized terms used herein without definition have the respective meanings
assigned thereto in Section 22;

          NOW, THEREFORE, Buyer, Seller and RVI agree as follows:

1. ASSIGNMENT OF CONTRACTS; ASSUMPTION OF LIABILITIES

     1.1. Assignment of Contracts; Assumption of Liabilities

          As of the Effective Date, Buyer shall assume only the liabilities and obligations of Seller
set forth below:

     (a) The debts, liabilities and obligations of Seller to be performed after the Effective Date
under the contracts, agreements, arrangements and understandings set forth and

 

 

described on
Schedule 2 or entered into after the date hereof (other than in each case debts,
liabilities and obligations on account of breaches or violations by Seller that occurred on or
prior to the Effective Date).

          (b) The executive employment agreements listed on Schedule 1.1(b), including the debts,
liabilities and obligations of Seller to be performed after the Effective Date under such executive
employment agreements.

          (c) The debts, liabilities and obligations incurred after the Effective Date by Buyer with
respect to the New Buyer IT Employees.

          Except as specified in this Section 1, Buyer shall not assume or be deemed to assume any
debts, liabilities or obligations of Seller, including, without limitation, any debts, liabilities
or obligations of Seller for acts or omissions of Seller on or before the Effective Date with
respect to the Information Technology Assets or the New Buyer IT Employees.

     1.2. Restricted Contracts

          The parties understand and agree that, without limiting any representation, warranty,
condition, covenant or indemnification contained in this Agreement, if, as of the Closing, Seller
shall not have effectively obtained any or all consents of any third party(ies) to the assignment
of the contracts, agreements, arrangements and understandings set forth and described on
Schedule 2 or entered into after the date hereof as provided in the definition of
Information Technology Assets (each a “Restricted Contract”) contemplated to be assigned to Buyer
hereunder, in respect of which such third party’s consent to assign is required in order to
preserve the value of such Restricted Contract for Seller or otherwise, then (a) the assignment by
Seller and the assumption by Buyer of such Restricted Contract shall not become effective at
Closing or thereafter until Seller shall have obtained the requisite consent to assign (which
Seller shall use commercially reasonable efforts to obtain, together with the cooperation of
Buyer), (b) such assignment and assumption shall become effective as aforesaid subsequent to
Closing pursuant to such documentation as shall be reasonably acceptable to Buyer and Seller, and
(c) Seller shall not take nor permit any action which would impair the full force and effect of
such Restricted Contract, or otherwise cause or permit the modification, amendment, or termination
of such Restricted Contract (except insofar as consented to by Buyer, which consent shall not be
unreasonably withheld or delayed) until the effective assignment thereof as aforesaid. The parties
understand and agree that Seller, subsequent to the Closing, shall not be entitled to any of the
rights and privileges under any Restricted Contract, all of which shall accrue to the benefit of
Buyer, and Seller shall be deemed to hold such Restricted Contract in trust for Buyer. To the
extent that Buyer is able to receive the economic rights and privileges under any Restricted
Contract, Buyer shall be responsible for the liabilities assumed by Buyer pursuant to Section 1.3
arising under such Restricted Contract.

2. REPRESENTATIONS AND WARRANTIES BY RVI ENTITIES

          Sellers, jointly and severally, represent and warrant to Buyer as follows:

- 2 -

 

     2.1. Organization and Standing

          (a) RVSI is a corporation duly organized, validly existing and in good standing under the laws
of the State of Ohio. RVSI has all the requisite corporate power and authority to enter into and
perform the terms of this Agreement, the other Seller Documents to which it is a party and the
transactions contemplated hereby and thereby.

          (b) RVI is a corporation duly organized, validly existing and in good standing under the laws
of the State of Ohio. RVI has all the requisite corporate power and authority to enter into and
perform the terms of this Agreement, the other Seller Documents to which it is a party and the
transactions contemplated hereby and thereby.

          (c) FB is a corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. FB has all the requisite corporate power and authority to enter into and
perform the terms of this Agreement, the other Seller Documents to which it is a party and the
transactions contemplated hereby and thereby.

          (d) VC is an Ohio limited liability company duly organized and in good standing under the laws
of the State of Ohio. VC has all the requisite limited liability company power and authority to
enter into and perform the terms of this Agreement, the other Seller Documents to which it is a
party and the transactions contemplated hereby and thereby.

     2.2. Authorization

          (a) The execution, delivery and performance of this Agreement and of the other Seller
Documents to which it is a party, and the consummation of the transactions contemplated hereby and
thereby have been duly and validly authorized by all necessary actions of Seller (none of which
actions has been modified or rescinded and all of which actions are in full force and effect).
This Agreement constitutes, and upon execution and delivery of each other Seller Document to which
it is a party will constitute, a valid and binding agreement and obligation of Seller, enforceable
in accordance with their respective terms. Except as specified in Section 2.3, the execution,
delivery and performance by Seller of this Agreement and of the other Seller Documents to which it
is a party will not require the consent, approval or authorization of any person, entity or
governmental authority.

          (b) The execution, delivery and performance of this Agreement and of the other Seller
Documents to which it is a party, and the consummation of the transactions contemplated hereby and
thereby have been duly and validly authorized by all necessary actions of RVI (none of which
actions has been modified or rescinded and all of which actions are in full force and effect).
This Agreement constitutes, and upon execution and delivery of each other Seller Document to which
it is a party will constitute, a valid and binding agreement and obligation of RVI, enforceable in
accordance with their respective terms. Except as specified in
Section 2.3, the execution, delivery and performance by RVI of this Agreement and of the other
Seller Documents to which it is a party will not require the consent, approval or authorization of
any person, entity or governmental authority.

- 3 -

 

     2.3. Conflicts and Consents

     Except as set forth on Schedule 2.3, the execution and delivery of this Agreement and
the other Seller Documents to which it is a party, the fulfillment of and the compliance with the
respective terms and provisions of each, and the consummation of the transactions described in
each, do not and will not conflict with or violate any law, ordinance, regulation, order, award,
judgment, injunction or decree applicable to Seller, or conflict with or result in a breach of or
constitute a default under any of the terms, conditions or provisions of Seller’s articles of
incorporation or bylaws, or any contract, agreement, lease, commitment, or understanding to which
Seller is a party or by which Seller is bound.

     2.4 Contracts and Agreements

     Schedule 2 contains a complete list, as of the date hereof, of each contract,
agreement, arrangement and understanding that will be assigned by Sellers to Buyer (collectively,
the “IT Contracts”). With the exception of so-called “shrink-wrap” and electronic on-screen
end-user licenses for mass-market computer software, all of the IT Contracts are fully and validly
executed by Seller and/or its affiliates and have been executed by the other parties thereto, and
all of the IT Contracts are in full force and effect, constitute legal, valid and binding
obligations of the respective parties thereto, and are enforceable in accordance with their
respective terms. Seller has performed in all material respects all of the obligations required to
be performed by it to date under each such IT Contract. No event has occurred which, with or
without notice or the passage of time or both, constitutes or would constitute a material breach or
default by Seller or any other party under any IT Contract or permit any other party to accelerate,
terminate, cancel or modify such IT Contract. There have been no threatened cancellations by any
third person of any IT Contract.

     2.5 Disclosure

     No representation or warranty or other statement made by Seller or RVI in this Agreement, the
Schedules or otherwise in connection with the transactions contemplated by this Agreement contains
any untrue statement or omits to state a material fact necessary to make any of them, in light of
the circumstances in which it was made, not misleading.

3. REPRESENTATIONS AND WARRANTIES BY BUYER

          Buyer represents and warrants to the RVI Entities as follows:

     3.1. Organization and Standing

          Buyer is a limited liability company duly organized, validly existing and in good standing
under the laws of the State of Ohio. Buyer has all the requisite limited liability company power
and authority to enter into and perform the terms of this Agreement and the other Buyer Documents
and to carry out the transactions contemplated hereby and thereby.

- 4 -

 

     3.2. Authorization

          The execution, delivery and performance of this Agreement and of the other Buyer Documents,
and the consummation of the transactions contemplated hereby and thereby, have been duly and
validly authorized by all necessary actions of Buyer (none of which actions has been modified or
rescinded and all of which actions are in full force and effect). This Agreement constitutes, and
upon execution and delivery each such other Buyer Document will constitute, a valid and binding
agreement and obligation of Buyer, enforceable in accordance with their respective terms. The
execution, delivery and performance by Buyer of this Agreement and the other Buyer Documents will
not require the consent, approval or authorization of any person, entity or governmental authority.

     3.3. Conflicts and Consents

          The execution and delivery of this Agreement and the other Buyer Documents, the fulfillment of
and the compliance with the respective terms and provisions of each, and the consummation of the
transactions described in each, do not and will not conflict with or violate any law, ordinance,
regulation, order, award, judgment, injunction or decree applicable to Buyer, or conflict with or
result in a breach of or constitute a default under any of the terms, conditions or provisions of
Buyer’s organizational documents, or any contract, agreement, lease, commitment, or understanding
to which Buyer is a party or by which Buyer is bound.

4. COVENANTS OF SELLER

Seller covenants and agrees with Buyer that Seller willuse commercially reasonable efforts to
obtain all third party consents required to assign to Buyer the Information Technology Assets set
forth on Schedule 2.3. Buyer shall cooperate with Seller with respect to obtaining all
such third party consents. All costs incurred or relating to the obtaining of all such third party
consents or otherwise arising from the assignment of the contracts, agreements, arrangements and
understandings set forth and described on Schedule 2 or entered into after the date hereof
as contemplated by this Agreement shall be considered an expense and treated as a shared expensed
pursuant to the terms of the Shared Services Agreement.

5. CONDITIONS PRECEDENT TO BUYER’S OBLIGATION TO CLOSE

          The obligations of Buyer to proceed with the Closing are subject to the satisfaction (or
waiver by Buyer) at or prior to the Closing of each of the following conditions:

     5.1. Representations and Covenants

          The representations and warranties of the RVI Entities made in this Agreement or in any other
Seller Document shall have been true and correct in all material respects when made, and shall be
true and correct in all material respects on the Closing Date as though such representations and
warranties were made on and as of the Closing Date; and the RVI Entities shall have performed and
complied in all material respects with all covenants and agreements

- 5 -

 

required by this Agreement or
any other Seller Document to be performed or complied with by the RVI Entities prior to the
Closing.

     5.2. Consents

          The parties shall have obtained prior to the Closing all consents necessary to effect valid
assignments to Buyer of all of the Information Technology Assets specified in Schedule 2.3
and all other consents necessary to consummate the transactions contemplated hereby.

     5.3. Delivery by the RVI Entities

          The RVI Entities shall have delivered to Buyer all consents, agreements and instruments
required to be delivered to Buyer pursuant to Section 7.2.

     5.4. Legal Proceedings

          No action or proceeding by or before any governmental authority shall have been instituted or
threatened (and not subsequently dismissed, settled or otherwise terminated) that might restrain,
prohibit or invalidate the transactions contemplated by this Agreement or any other Seller
Document, other than an action or proceeding instituted or threatened by Buyer or DSW.

6. CONDITIONS PRECEDENT TO SELLER’S OBLIGATION TO CLOSE

          The obligations of Seller to proceed with the Closing are subject to the satisfaction (or
waiver by Seller) at or prior to the Closing of each of the following conditions:

     6.1. Representations and Covenants

          The representations and warranties of Buyer made in this Agreement or in any other Buyer
Document shall have been true and correct in all material respects when made, and shall be true and
correct in all material respects on the Closing Date as though such representations and warranties
were made on and as of the Closing Date; and Buyer shall have performed and complied in all
material respects with all covenants and agreements required to be performed or complied with by
Buyer prior to the Closing.

     6.2. Delivery by Buyer

          Buyer shall have delivered to the RVI Entities all agreements and instruments required to be
delivered to the RVI Entities pursuant to Section 7.3.2.

- 6 -

 

     6.3. Legal Proceedings

          No action or proceeding by or before any governmental authority shall have been instituted or
threatened (and not subsequently dismissed, settled or otherwise terminated) that might restrain,
prohibit or invalidate the transactions contemplated by this Agreement or any other Buyer Document,
other than an action or proceeding instituted or threatened by Seller or RVI.

7. THE CLOSING

     7.1. Closing

          The Closing hereunder shall be held on the date hereof (the “Closing Date”).

     7.2. Delivery by the RVI Entities

          At or before the Closing, the RVI Entities shall deliver to Buyer:

          7.2.1. Agreements and Instruments

          The following documents, dated as of the Closing Date, in form satisfactory to Buyer:

               (i) the Assumption Agreement; and

               (ii) such other instruments or documents as Buyer may reasonably request in order to effect
and document the transactions contemplated hereby.

          7.2.2. Consents

          Copies of all consents listed on Schedule 2.3.

          7.2.3. Amendment No. 1 to Shared Services Agreement

          Executed Amendment No. 1 to Shared Services Agreement.

          7.2.4. Release of Encumbrances

          Evidence of release of Encumbrances set forth in Schedule 2.4(a) in form and substance
reasonably acceptable to Buyer.

     7.3. Delivery by Buyer

          At or before the Closing, Buyer shall deliver to the RVI Entities:

- 7 -

 

          7.3.1. Agreements and Instruments

          The following agreements and instruments:

               (i) Amendment No. 1 to Shared Services Agreement;

               (ii) the Assumption Agreement; and

               (iii) such other instruments or documents as Seller may reasonably request in order to effect
and document the transactions contemplated hereby.

8. SURVIVAL; INDEMNIFICATION

     8.1. Survival of RVI Entities’ Representations

          The representations and warranties made by the RVI Entities in this Agreement or pursuant
hereto shall survive the Closing Date for a period of one (1) year.

     8.2. Indemnification by Seller

          Subject to the conditions and provisions of Section 8.5, Seller agrees to indemnify, defend
and hold harmless Buyer and its affiliates from and against any and all demands, claims,
complaints, actions or causes of action, suits, proceedings, investigations, arbitrations,
assessments, losses, damages, liabilities, costs and expenses, including, but not limited to,
interest, penalties and reasonable attorneys’ fees and disbursements, asserted against, imposed
upon or incurred by Buyer and/or its affiliates, directly or indirectly, by reason of or resulting
from (a) any debt, liability or obligation of or claim against Seller (whether absolute, accrued,
contingent or otherwise and whether a contractual, tax or any other type of liability or obligation
or claim) not expressly assumed by Buyer pursuant to Section 1.3, (b) any misrepresentation or
breach of the representations and warranties of the RVI Entities contained in or made pursuant to
this Agreement or any other Seller Document, or (c) any noncompliance by the RVI Entities with any
covenants, agreements or undertakings of Seller or RVI contained in or made pursuant to this
Agreement or any other Seller Document.

     8.3. Survival of Buyer’s Representations

          The representations and warranties made by Buyer in this Agreement or pursuant hereto shall
survive the Closing Date for a period of one (1) year.

     8.4. Indemnification by Buyer

          Subject to the conditions and provisions of Section 8.5, Buyer agrees to indemnify, defend and
hold harmless Seller and its affiliates from and against any and all demands, claims, complaints,
actions or causes of action, suits, proceedings, investigations, arbitrations, assessments, losses,
damages, liabilities, costs and expenses, including, but not

- 8 -

 

limited to, interest, penalties and
reasonable attorneys’ fees and disbursements, asserted against, imposed upon or incurred by Seller
and/or its affiliates, directly or indirectly, by reason of or resulting from (a) any debt,
liability or obligation of or claim against Seller (whether absolute, accrued, contingent or
otherwise and whether a contractual, tax or any other type of liability or obligation or claim)
expressly assumed by Buyer pursuant to Section 1.3, (b) any misrepresentation or breach of the
representations and warranties of Buyer contained in or made pursuant to this Agreement or any
other Buyer Document, or (c) any noncompliance by Buyer with any covenants, agreements or
undertakings of Buyer contained in or made pursuant to this Agreement or any other Buyer Document.

8.5. Conditions of Indemnification

          The obligations and liabilities of Seller and Buyer hereunder with respect to their respective
indemnities pursuant to this Section 8, resulting from any claim or other assertion of liability by
third parties (hereinafter called collectively, “Claims”), shall be subject to the following terms
and conditions:

          (a) The party seeking indemnification (the “Indemnified Party”) must give the other party or
parties, as the case may be (the “Indemnifying Party”), notice of any such Claim promptly after the
Indemnified Party receives notice thereof; provided, however, that failure to give such notice
promptly shall not relieve the Indemnifying Party of its obligations under this Section 8 except to
the extent that the Indemnifying Party is prejudiced thereby.

          (b) The Indemnifying Party shall have the right to undertake, by counsel or other
representatives of its own choosing, the defense of such Claim.

          (c) In the event that the Indemnifying Party shall elect not to undertake such defense, or
within a reasonable time after notice of any such Claim from the Indemnified Party shall fail to
defend, the Indemnified Party (upon further written notice to the Indemnifying Party) shall have
the right to undertake the defense, compromise or settlement of such Claim, by counsel or other
representatives of its own choosing, on behalf of and for the account and risk of the Indemnifying
Party (subject to the right of the Indemnifying Party to assume defense of such Claim at any time
prior to settlement, compromise or final determination thereof).

          (d) Anything in this Section 8.5 to the contrary notwithstanding, if there is a reasonable
probability that a Claim may materially and adversely affect the Indemnified Party other than as a
result of money damages or other money payments, (i) the Indemnified Party shall have the right, at
its own cost and expense, to participate in the defense, compromise or settlement of the Claim,
(ii) the Indemnifying Party shall not, without the Indemnified Party’s written consent, settle or
compromise any Claim or consent to entry of any judgment which does
not include as an unconditional term thereof the giving by the claimant or the plaintiff to
the Indemnified Party of a release from all liability in respect of such Claim, and (iii) in the
event that the Indemnifying Party undertakes defense of any Claim, the Indemnified Party, by
counsel or other representative of its own choosing and at its sole cost and expense, shall have
the right to consult with the Indemnifying Party and its counsel or other representatives
concerning such

- 9 -

 

Claim and the Indemnifying Party and the Indemnified Party and their respective
counsel or other representatives shall cooperate with respect to such Claim.

9. ADDITIONAL COVENANTS OF THE PARTIES

     9.1. Mutual Covenants

          9.1.1. Additional Actions and Documents

          Each of the parties hereto agrees that it will, at any time, prior to, at or after the Closing
Date, take or cause to be taken such further actions, and execute, deliver and file or cause to be
executed, delivered and filed such further documents and instruments, and obtain such consents, as
may be necessary or reasonably requested in connection with the consummation of the purchase and
sale contemplated by this Agreement or in order to fully effectuate the purposes, terms and
conditions of this Agreement.

          9.1.2. Public Announcements

          Each of Seller and Buyer agrees that it shall consult with the other before issuing any press
release or making any public announcement with respect to the sale of the Information Technology
Assets and shall not issue any such press release or make any such public announcements (either
before or after the Closing Date) prior to such consultation unless otherwise required by any
applicable laws or stock listing requirements.

     9.2. Covenants of RVI Entities

          9.2.1. Certain Third Party Warranties

          If Seller shall have recourse to a warranty, representation or indemnity or similar
contractual protective provision made by a third party to Seller that relates to the transactions
contemplated by this Agreement, Seller shall use its commercially reasonable efforts from and after
the Closing to provide the benefit of such warranty, representation or indemnity or similar
provision, to Buyer upon Buyer’s request.

     9.3 Guarantees.

          9.3.1 RVI, for itself and its successors in interest and assigns, hereby irrevocably and
unconditionally guarantees the full and faithful performance and observation by Seller under
this Agreement of all representations, warranties, covenants, conditions, indemnities and
agreements set forth in this Agreement provided to be performed and observed by Seller. RVI does
hereby waive notice of acceptance of this guaranty, notice of protest or compliance with the terms
and provisions of this Agreement and notice of non-performance or non-observance hereof. Each
default in payment or performance of any obligations hereunder shall

- 10 -

 

give rise to a separate cause
of action under this Section 9 and separate suits may be brought hereunder as each cause of action
arises.

          9.3.2 DSW, for itself and its successors in interest and assigns, hereby irrevocably and
unconditionally guarantees the full and faithful performance and observation by Buyer under this
Agreement of all representations, warranties, covenants, conditions, indemnities and agreements set
forth in this Agreement provided to be performed and observed by Buyer. DSW does hereby waive
notice of acceptance of this guaranty, notice of protest or compliance with the terms and
provisions of this Agreement and notice of non-performance or non-observance hereof. Each default
in payment or performance of any obligations hereunder shall give rise to a separate cause of
action under this Section 9 and separate suits may be brought hereunder as each cause of action
arises.

10. EMPLOYEES AND EMPLOYEE BENEFITS

          10.1.1. Employment of IT Employees

          (a) As of the Effective Date, the employees listed on Schedule 3 (the “New Buyer IT
Employees”) shall become employees of Buyer. Buyer shall be responsible for the payment of all
wages and other remuneration due to New Buyer IT Employees with respect to their services as
employees of Buyer from and after the Effective Date. Nothing in this Agreement establishes any
right in the New Buyer IT Employees to payments of any kind relating to termination of employment.

          (b) Seller shall be responsible for the payment of all wages and other remuneration due to New
Buyer IT Employees with respect to their services as employees of Seller until the Effective Date,
including pro rata bonus payments and all vacation pay earned prior to the Effective Date.

          (c) Seller or, as applicable, the Plans shall be liable for any claims made or incurred by New
Buyer IT Employees and their beneficiaries through the Effective Date under any employee benefit
plans in which the New Buyer IT Employees participate. For purposes of the immediately preceding
sentence, a charge will be deemed incurred, in the case of hospital, medical or dental benefits,
when the services that are the subject of the charge are performed and, in the case of other
benefits (such as disability or life insurance), when an event has occurred or when a condition has
been diagnosed that entitles the employee to the benefit.

          (d) It is the intent of the parties that any equity awards granted (stock options, SARs, etc.)
by the RVI Entities to the New Buyer IT Employees prior to the Effective Date shall
remain outstanding, and New Buyer IT Employees will remain subject to the terms and conditions
of those awards and underlying plans.

          (e) Immediately following the transactions contemplated hereby, all reasonable efforts will be
made to quickly transition payroll records and systems from Sellers to

- 11 -

 

Buyer, so
that all applicable payments are made on Buyer’s behalf, with such
transition to be concluded no later than thirty days following the
Effective Date.

          10.1.2. Retirement and Welfare Plans

          Following the Effective Date, to the extent permitted by law and applicable tax qualification
requirements, and subject to any generally applicable break in service or similar rule, and the
approval of any insurance carrier, third party provider or the like with commercially reasonable
efforts of the RVI Entities and Buyer, each New Buyer IT Employee shall continue to participate in
retirement and welfare benefit plans in which he or she was participating prior to the Closing Date
and shall receive service credit for purposes of eligibility to participate and vesting (but not
for benefit accrual purposes) for employment, compensation, and employee benefit plan purposes with
the Seller prior to the Effective Date. Notwithstanding any of the foregoing to the contrary, none
of the provisions contained herein shall operate to duplicate any benefit provided to any New Buyer
IT Employees or the funding of any such benefit. The RVI Entities and Buyer will also cause all
(a) pre-existing conditions and proof of insurability provisions, for all conditions that all New
Buyer IT Employees and their covered dependents have as of the Effective Date, and (b) waiting
periods under each plan that would otherwise be applicable to newly hired employees to be waived in
the case of clause (a) or clause (b) with respect to New Buyer IT Employees to the same extent
waived or satisfied under the RVI Entities’ employee benefit plans; provided that nothing in this
sentence shall limit the ability of the RVI Entities or the Buyer from amending or entering into
new or different employee benefit plans or arrangements provided such plans or arrangements treat
the New Buyer IT Employees in a substantially similar manner as employees of Buyer are treated.

          10.1.3. General Employee Provisions

          (a) Buyer will set its own initial terms and conditions of employment for the New Buyer IT
Employees and others it may hire, including work rules, benefits and salary and wage structure, all
as permitted by law.

          (b) Seller and Buyer shall give any notices required by applicable law and take whatever other
actions with respect to the plans, programs and policies described in this Section 10 as may be
necessary to carry out the arrangements described in this Section 10.

          (c) Seller and Buyer shall provide each other with such plan documents and summary plan
descriptions, employee data or other information as may be reasonably required to carry out the
arrangements described in this Section 10.

(d) Buyer shall not have any responsibility, liability or obligation, whether to New
Buyer IT Employees, former employees, their beneficiaries or to any other person,
with respect to any employee benefit plans, practices, programs or
arrangements (including the establishment, operation or termination thereof and the
notification and provision of COBRA coverage extension) maintained by Seller.

- 12 -

 

11. SALES, TRANSFER AND OTHER TAXES

          Buyer and Seller shall pay all sales, transfer or other taxes, if any, arising from the
transactions contemplated by this Agreement, regardless of the person on whom any such taxes are
imposed by law. Such payment will be apportioned based upon the Percent of Sales Billing ratio
existing at the date of Closing.

12. TERMINATION

          The parties may terminate this Agreement by mutual written agreement at any time prior to the
Closing. In addition, either Buyer, on the one hand, or Seller and RVI, on the other hand, may
terminate this Agreement if the Closing shall not have occurred on or before December 31, 2006. In
the event that this Agreement is terminated pursuant to this Section 12, such termination shall be
without any liability or obligation to any party or parties and all further obligations of the
parties hereunder shall terminate.

13. NOTICES

     All notices, demands, requests or other communications which may be or are required to be
given or made by any party to any other party pursuant to this Agreement shall be in writing and
shall be hand delivered, mailed by first-class registered or certified mail, return receipt
requested, postage prepaid, delivered by overnight air courier, or transmitted by telegram, telex
or facsimile transmission addressed as follows:

(i) If to Buyer:

Brand Technology Services LLC

4150 East Fifth Avenue

Columbus, Ohio 43219

Attn: Chief Technology Officer

Telecopier Number: 614/872-1464

with a copy (which shall not constitute notice) to:

DSW Inc.

4150 East Fifth Avenue

Columbus, Ohio 43219

Attn:  General Counsel

Telecopier Number: 614/872-1464

- 13 -

 

(ii) If to Seller or RVI:

Retail Ventures, Inc.

3241 Westerville Road

Columbus, Ohio 43224

Attn: Chief Financial Officer

Telecopier Number: 614/473-2721

with a copy (which shall not constitute notice) to:

Retail Ventures, Inc.

3241 Westerville Road

Columbus, Ohio 43224

Attn: General Counsel

Telecopier Number: 614/337-4682

or such other address as the addressee may indicate by written notice to the other party.

          Each notice, demand, request or communication which shall be given or made in the manner
described above shall be deemed sufficiently given or made for all purposes at such time as it is
delivered to the addressee (with the return receipt, the delivery receipt, the affidavit of
messenger or (with respect to a telex) the answerback being deemed conclusive but not exclusive
evidence of such delivery) or at such time as delivery is refused by the addressee upon
presentation.

14. WAIVER

          No delay or failure on the part of any party hereto in exercising any right, power or
privilege under this Agreement or under any other instrument or document given in connection with
or pursuant to this Agreement shall impair any such right, power or privilege or be construed as a
waiver of any default or any acquiescence therein. No single or partial exercise of any such
right, power or privilege shall preclude the further exercise of such right, power or privilege, or
the exercise of any other right, power or privilege. No waiver shall be valid against any party
hereto unless made in writing and signed by the party against whom enforcement of such waiver is
sought and then only to the extent expressly specified therein.

15. BENEFIT AND ASSIGNMENT

          Except as hereinafter specifically provided in this Section 15, no party hereto shall assign
this Agreement, in whole or in part, whether by operation of law or otherwise, without the prior
written consent of Seller (if the assignor is Buyer) or Buyer (if the assignor is Seller or RVI);
and any purported assignment contrary to the terms hereof shall be null, void and of no force and
effect. In no event shall any assignment by Seller or RVI of its rights and obligations under this
Agreement, whether before or after the Closing, release Seller or RVI from its liabilities
hereunder. Notwithstanding the foregoing, Buyer or any permitted assignee of

- 14 -

 

Buyer may assign this Agreement and any and all rights hereunder, in whole or in part, to any
direct or indirect subsidiary of DSW.

          This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and
their respective successors and assigns as permitted hereunder. No person or entity other than the
parties hereto is or shall be entitled to bring any action to enforce any provision of this
Agreement against any of the parties hereto, and the covenants and agreements set forth in this
Agreement shall be solely for the benefit of, and shall be enforceable only by, the parties hereto
or their respective successors and assigns as permitted hereunder.

16. REMEDIES CUMULATIVE

          Except as specifically provided herein, the remedies provided herein shall be cumulative and
shall not preclude the assertion by a party of any other rights or the seeking of any other
remedies against the other parties, or their successors or assigns. Nothing contained herein shall
preclude a party from seeking equitable relief, where appropriate.

17. ENTIRE AGREEMENT; AMENDMENT

          This Agreement, including the Schedules and Exhibits hereto and the other instruments and
documents referred to herein or delivered pursuant hereto, contains the entire agreement among the
parties with respect to the subject matter hereof and supersedes all prior oral or written
agreements, commitments or understandings with respect to such matters. No amendment, modification
or discharge of this Agreement shall be valid or binding unless set forth in writing and duly
executed by the party against whom enforcement of the amendment, modification or discharge is
sought.

18. SEVERABILITY

          If any part of any provision of this Agreement or any other agreement, document or writing
given pursuant to or in connection with this Agreement shall be invalid or unenforceable under
applicable law, such part shall be ineffective to the extent of such invalidity or unenforceability
only, without in any way affecting the remaining parts of such provisions or the remaining
provisions of said agreement.

19. HEADINGS

          The headings of the sections and subsections contained in this Agreement are inserted for
convenience only and do not form a part or affect the meaning, construction or scope thereof.

- 15 -

 

20. GOVERNING LAW

          This Agreement, the rights and obligations of the parties hereto, and any claims or disputes
relating thereto, shall be governed by and construed under and in accordance with the laws of the
State of Ohio, excluding the choice of law rules thereof.

21. DEFINITIONS AND REFERENCES

          As used herein, the following terms shall have the meanings set forth below, unless the
context otherwise requires:

          “Agreement” shall have the meaning set forth in the Preamble.

          “Amendment No. 1 to Shared Services Agreement” means that certain Amendment No. 1 to Shared
Services Agreement, dated as of the Closing Date and executed by DSW and RVI, substantially in the
form attached hereto as Exhibit B.

          “Assumption Agreement” means that certain Assumption Agreement, dated as of the Closing Date
and executed by Buyer and Seller, substantially in the form attached hereto as Exhibit A.

          “Buyer” shall have the meaning set forth in the Preamble.

          “Buyer Documents” shall mean, together, this Agreement and the Assumption Agreement.

          “Claims” shall have the meaning set forth in Section 8.5.

          “Closing” means the closing of the assignment and sale of the IT Contracts contemplated
hereunder.

          “Closing Date” means the time and date on which the Closing takes place, as established by
Section 7.1.

          “DSW” shall have the meaning set forth in the Preamble.

          “Encumbrances” shall mean any mortgages, pledges, liens, claims, security interests,
restrictions, defects in title, easements, taxes, encumbrances or charges.

          “Indemnified Party” and “Indemnifying Party” shall have the respective meanings set forth in
Section 8.5(a).

          “IT Contracts” shall have the meaning set forth in Section 2.5(a).

          “IT Employees” shall mean those employees of RVI and its affiliates set forth on Schedule
3, which Schedule 3 includes the job title, date of hire, current compensation paid or
payable, and the employee benefit plans in which such individuals participate.

- 16 -

 

          “New Buyer IT Employees” shall have the meaning set forth in Section 10.1.1(a).

          “Restricted Contract” shall have the meaning set forth in Section 1.4.

          “RVI” shall have the meaning set forth in the Preamble.

          “RVI Entities” shall have the meaning set forth in the Preamble.

          “Seller” shall have the meaning set forth in the Preamble.

          “Seller Documents” shall mean, collectively, this Agreement and the Assumption Agreement.

          “Shared Services Agreement” shall have the meaning set forth in the Preamble.

          All references to clauses, Sections, Exhibits and Schedules are to Sections of, and Exhibits
and Schedules to, this Agreement. For purposes of this Agreement, DSW and its subsidiaries shall
not be deemed to be “affiliates” of RVI or Seller.

22. SIGNATURE IN COUNTERPARTS

          This Agreement may be executed in separate counterparts, none of which need contain the
signatures of all parties, each of which shall be deemed to be an original, and all of which taken
together constitute one and the same instrument. It shall not be necessary in making proof of this
Agreement to produce or account for more than the number of counterparts containing the respective
signatures of, or on behalf of, all of the parties hereto.

- 17 -

 

          IN WITNESS WHEREOF, each of the parties hereto has executed and delivered this Agreement, or
has caused this Agreement to be duly executed and delivered in its name on its behalf, all as of
the day and year first above written.

	 	 	 	 	 
	BRAND TECHOLOGY
SERVICES, LLC	 	 
	 
	 	 	 	 
	By:

	 	/s/Peter Z. Horvath
 

	 	 
	Name: Peter Z. Horvath

Title: President	 	 
	 
	 	 	 	 
	RETAIL VENTURES, INC.	 	 
	 
	 	 	 	 
	By:

	 	/s/James A. McGrady
 

	 	 
	Name: James A. McGrady

Title: Chief Financial Officer	 	 
	 
	 	 	 	 
	RETAIL VENTURES SERVICES, INC.	 	 
	 
	 	 	 	 
	By:

	 	/s/James A. McGrady
 

	 	 
	Name: James A. McGrady

Title: Chief Financial Officer	 	 
	 
	 	 	 	 
	FILENE’S BASEMENT, INC.	 	 
	 
	 	 	 	 
	By:

	 	/s/James A. McGrady
 

	 	 
	Name: James A. McGrady

Title: Chief Financial Officer	 	 
	 
	 	 	 	 
	VALUE CITY DEPARTMENT STORES LLC	 	 
	 
	 	 	 	 
	By:

	 	/s/James A. McGrady
 

	 	 
	Name: James A. McGrady

Title: Chief Financial Officer	 	 
	 
	 	 	 	 
	Agreed Solely for Purposes of Section 9.3.2:

DSW INC.	 	 
	 
	 	 	 	 
	By:

	 	/s/Peter Z. Horvath
 

	 	 
	Name: Peter Z. Horvath

Title: President	 	 

- 18 -EX-10.8

 

Exhibit 10.8

AMENDED AND RESTATED

SHARED SERVICES AGREEMENT

DATED AS OF October 29, 2006

BETWEEN

DSW INC.

AND

RETAIL VENTURES, INC.

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	            SECTION 1.01. Definitions
	 	 	1	 
	            SECTION 1.02. Internal References
	 	 	5	 
	 
	 	 	 	 
	ARTICLE II PURCHASE AND SALE OF SERVICES
	 	 	5	 
	 
	 	 	 	 
	            SECTION 2.01. Purchase and Sale of Retail Ventures Services
	 	 	5	 
	            SECTION 2.02. Purchase and Sale of DSW Services
	 	 	5	 
	            SECTION 2.03 Additional Services
	 	 	5	 
	 
	 	 	 	 
	ARTICLE III SERVICE COSTS; OTHER CHARGES
	 	 	6	 
	 
	 	 	 	 
	            SECTION 3.01. Service Costs Generally
	 	 	6	 
	            SECTION 3.02. Customary Billing
	 	 	6	 
	            SECTION 3.03. Pass-Through Billing
	 	 	6	 
	            SECTION 3.04. Percent of Sales Billing
	 	 	7	 
	            SECTION 3.05. Benefit Billing
	 	 	7	 
	            SECTION 3.06. Invoicing and Settlement of Costs
	 	 	7	 
	 
	 	 	 	 
	ARTICLE IV STANDARD OF PERFORMANCE AND INDEMNIFICATION
	 	 	8	 
	 
	 	 	 	 
	            SECTION 4.01.
	 	 	8	 
	            (i)General Standard of Service
	 	 	8	 
	            SECTION 4.02. Delegation
	 	 	9	 
	            SECTION 4.03. Limitation of Liability
	 	 	9	 
	            SECTION 4.04. Indemnification Related to Retail Ventures Services
	 	 	10	 
	            SECTION 4.05. Indemnification Related to DSW Services
	 	 	11	 
	 
	 	 	 	 
	ARTICLE V TERM AND TERMINATION
	 	 	12	 
	 
	 	 	 	 
	            SECTION 5.01. Term
	 	 	12	 
	            SECTION 5.02. Termination
	 	 	12	 
	            SECTION 5.03. Effect of Termination
	 	 	12	 
	 
	 	 	 	 
	ARTICLE VI INSURANCE MATTERS
	 	 	13	 
	 
	 	 	 	 
	            SECTION 6.01. DSW Insurance Coverage During Transition Period
	 	 	13	 
	            SECTION 6.02. Cooperation; Payment of Insurance Proceeds to DSW; Agreement Not
to Release Carriers
	 	 	13	 
	            SECTION 6.03. DSW Insurance Coverage After the Insurance Transition Period
	 	 	14	 
	            SECTION 6.04. Deductibles and Self-Insured Obligations
	 	 	14	 
	            SECTION 6.05. Procedures with Respect to Insured DSW Liabilities
	 	 	14	 

- i - 

 

	 	 	 	 	 
	 	 	Page	 
	            SECTION 6.06. Insufficient Limits of Liability for Retail Ventures Liabilities
and DSW Liabilities
	 	 	14	 
	            SECTION 6.07. Cooperation
	 	 	15	 
	            SECTION 6.08. No Assignment or Waiver
	 	 	15	 
	            SECTION 6.09. No Liability
	 	 	15	 
	            SECTION 6.10. Additional or Alternate Insurance
	 	 	15	 
	            SECTION 6.11. Forbearance and Prior Insurance Coverage
	 	 	15	 
	            SECTION 6.12. Further Agreements
	 	 	16	 
	 
	 	 	 	 
	ARTICLE VII INFORMATION TECHNOLOGY EXECUTIVE STEERING COMMITTEE
	 	 	16	 
	 
	 	 	 	 
	            SECTION 7.01. Formation
	 	 	16	 
	            SECTION 7.02. Meetings
	 	 	16	 
	            SECTION 7.03. Purpose; Agenda; Minutes
	 	 	16	 
	            SECTION 7.04. Budget/Proposals
	 	 	17	 
	            SECTION 7.05. Information Technology Capital Expenditures
	 	 	17	 
	 
	 	 	 	 
	ARTICLE VIII ADDITIONAL AGREEMENTS
	 	 	18	 
	 
	 	 	 	 
	            SECTION 8.01. Annual Budget
	 	 	18	 
	            SECTION 8.02. Employment Matters
	 	 	18	 
	            SECTION 8.03. Shared Expenses Agreement
	 	 	18	 
	 
	 	 	 	 
	ARTICLE VIII MISCELLANEOUS
	 	 	18	 
	 
	 	 	 	 
	            SECTION 9.01. Prior Agreements
	 	 	18	 
	            SECTION 9.02. Other Agreements
	 	 	19	 
	            SECTION 9.03. Future Litigation and Other Proceedings
	 	 	19	 
	            SECTION 9.04. No Agency
	 	 	19	 
	            SECTION 9.05. Subcontractors
	 	 	19	 
	            SECTION 9.06. Force Majeure
	 	 	19	 
	            SECTION 9.07. Entire Agreement
	 	 	20	 
	            SECTION 9.08. Information
	 	 	20	 
	            SECTION 9.09. Notices
	 	 	20	 
	            SECTION 9.10. Governing Law
	 	 	21	 
	            SECTION 9.11. Severability
	 	 	21	 
	            SECTION 9.12. Amendment
	 	 	21	 
	            SECTION 9.13. Counterparts
	 	 	21	 
	            SECTION 9.14. Authority
	 	 	21	 

- ii -

 

 

SCHEDULES

	 	 	 
	SCHEDULE I:

	 	Services To Be Provided By Retail Ventures, Inc.
	SCHEDULE II:

	 	Services To Be Provided By DSW Inc.
	SCHEDULE III:

	 	Insurance Policies Maintained by Retail Ventures, Inc.

- iii -

 

 

AMENDED AND RESTATED

SHARED SERVICES AGREEMENT

     This Amended and Restated Shared Services Agreement is entered into to be effective as of
October 29, 2006 by and between DSW Inc., an Ohio corporation (“DSW”), and Retail Ventures, Inc. an
Ohio corporation (“Retail Ventures”). DSW and Retail Ventures are sometimes being referred to
herein separately as a “Party” and together as the “Parties”. Capitalized terms used herein and
not otherwise defined shall have the meanings ascribed to them in Article I hereof.

RECITALS

     WHEREAS, the Articles of Incorporation of DSW authorize 170,000,000 Class A common shares,
without par value (the “Class A common shares”) and 100,000,000 Class B common shares, without par
value (the “Class B common shares”);

     WHEREAS, DSW made an initial public offering (the “Offering”) of an amount of Class A common
shares pursuant to a registration statement on Form S-1 under the Securities Act of 1933, as
amended (the “Registration Statement”);

     WHEREAS, immediately following consummation of the Offering, Retail Ventures owned and
continues to own Class B common shares evidencing at least 80.1% of the combined voting power of
the holders of the Class A common shares and the Class B common shares with respect to all
shareholder matters;

     WHEREAS, prior to the consummation of the Offering, Retail Ventures directly or indirectly
provided certain financial, management and other services to the DSW Entities (as defined below),
and DSW directly or indirectly provided certain administrative, management and other services to
the Retail Ventures Entities (as defined below);

     WHEREAS, in connection with the consummation of the Offering, each Party set forth in the
Initial Agreement (as defined below) the principal terms and conditions pursuant to which certain
services were to be provided by it to, and certain services were to be provided to it by, the other
Party; and

     WHEREAS, the Parties now wish to amend and restate the Initial Agreement for purposes of (a)
transferring responsibility for certain Information Technology Services (as defined below) from
Retail Ventures to DSW;(b) modifying certain terms applicable to the Shoe Processing Services (as
defined below); and (c) other amendments to reflect agreed upon changes in shared services, all in
accordance with the terms of this Agreement;

     NOW, THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto,
for themselves and their respective successors and assigns, hereby covenant and agree as follows:

ARTICLE I DEFINITIONS

     SECTION 1.01. Definitions. (a) As used in this Agreement, the following terms shall have the following meanings,
applicable both to the singular and the plural forms of the terms described:

     “Agreement” means this Amended and Restated Shared Services Agreement, together with the
schedules and exhibits hereto, as the same may be amended and supplemented from time to time in
accordance with the provisions hereof.

1

 

     “Agreement Date” means the effective date of this Agreement first set forth above.

     “Billing Party Entities” means (a) with respect to Services for which DSW is the Billing
Party, DSW Entities, and (b) with respect to Services for which Retail Ventures is the Billing
Party, Retail Ventures Entities.

     “Business Day” means a day other than a Saturday, Sunday or other day on which commercial
banks in New York, New York or Columbus, Ohio are authorized or required by law to close.

     “Contract” means any contract, agreement, lease, license, sales order, purchase order,
instrument or other commitment that is binding on any Person or any part of such Person’s property
under applicable law.

     “Department” means a business section or division of a Party.

     “Distribution Date” means the date on which Retail Ventures is no longer required to
consolidate DSW’s results of operations and financial condition (determined in accordance with
generally accepted accounting principles consistently applied) with Retail Ventures’ results of
operations and financial condition.

     “DSW Business” means the specialty branded footwear retail business engaged in by DSW, as more
completely described in the Registration Statement, and any businesses added under the control of
DSW.

     “DSW Entities” means DSW Inc. and its Subsidiaries, and “DSW Entity” means any one of the DSW
Entities.

     “DSW Liabilities” has the meaning set forth in the Master Separation Agreement.

     “DSW Services” means the various services to be provided by DSW on behalf of or for the Retail
Ventures Entities as described in this Agreement and/or in Schedule II.

     “Exchange Agreement” means an agreement between the parties relating to the exchange of Class
A common shares for Class B common shares.

     “Information Technology Services” means those services referenced on Schedule II that were
provided by or on behalf of Retail Ventures before the Information Technology Services Transfer
Date and will be provided by DSW after the Information Technology Services Transfer Date.

     “Information Technology Services Transfer Date” shall mean the date that is mutually agreed
upon by the Parties for transfer of responsibility for
performance of the Information Technology Services from Retail Ventures to DSW.

     “Initial Agreement” means the Shared Services Agreement between DSW and Retail Ventures, dated
as of January 30, 2005, together with the schedules and exhibits thereto.

     “Insurance Policies” means insurance policies pursuant to which a Person makes a true risk
transfer to an insurer.

     “Insurance Proceeds” means those monies: (a) received by an insured from an insurance
carrier; or (b) paid by an insurance carrier on behalf of the insured; or (c) from Insurance
Policies.

2

 

     “Insured DSW Liability” means any DSW Liability to the extent that (i) it is covered under the
terms of Retail Ventures’ Insurance Policies in effect prior to the end of the Insurance Transition
Period, and (ii) DSW is not a named insured under, or otherwise entitled to the benefits of, such
Insurance Policies.

     “Liabilities” means all debts, liabilities, guarantees, assurances, commitments and
obligations, whether fixed, contingent or absolute, asserted or unasserted, matured or unmatured,
liquidated or unliquidated, accrued or not accrued, known or unknown, due or to become due,
whenever or however arising (including, without limitation, whether arising out of any Contract or
tort based on negligence or strict liability) and whether or not the same would be required by
generally accepted principles and accounting policies to be reflected in financial statements or
disclosed in the notes thereto.

     “Master Separation Agreement” means an agreement entered into by the Parties in connection
with the Offering that sets forth the principal arrangements between them regarding the separation
of the DSW business from Retail Ventures.

     “Offering Date” means 12:01 a.m., New York City Time, on June 28, 2005.

     “Person” means any individual, partnership, limited liability company, joint venture,
corporation, trust, unincorporated organization, government (including any department or agency
thereof) or other entity.

     “Receiving Party Entities” means (a) with respect to Services for which DSW is the Billing
Party, Retail Ventures Entities, and (b) with respect to Services for which Retail Ventures is the
Billing Party, DSW Entities.

     “Retail Ventures Entities” means Retail Ventures and its Subsidiaries (other than the DSW
Entities), and “Retail Venture Entity” means any one of the Retail Venture Entities currently in
place on the effective date of the Registration Statement and any businesses added under the
control of Retail Ventures.

     “Retail Ventures Services” means the various services to be provided by Retail Ventures on
behalf of or for the DSW Entities as described in this Agreement, in Schedule I and/or in Schedule
III.

     “RVSI” means Retail Ventures Services, Inc., an Ohio corporation and wholly-owned subsidiary
of Retail Ventures.

     “Schedule I” means the first Schedule attached hereto which lists Services to be provided by
Retail Ventures on behalf of or for DSW Entities and sets forth the related Retail Ventures Service
Costs and/or billing methodology.

     “Schedule II” means the second Schedule attached hereto which lists Services to be provided by
DSW on behalf of or for Retail Ventures Entities and sets forth the related DSW Service Costs
and/or billing methodology.

     “Schedule III” means the third Schedule attached hereto which lists the Insurance Policies to
be maintained by Retail Ventures on behalf of or for the DSW Entities and premium expenses and/or
the methodology for calculating the premium expenses to be paid by DSW for insurance coverage under
such Insurance Policies.

     “Schedules” means any one or more of the schedules referred to in and attached to this
Agreement.

3

 

     “Services” means the DSW Services and/or the Retail Ventures Services, as the context may
require.

     “Shoe Processing Services” means the shoe processing services for Value City Department Stores
LLC that are included in the DSW Services described in Section 2 of Schedule II.

     “Subsidiary” means, as to any Person, any corporation, association, partnership, joint venture
or other business entity of which more than 50% of the voting capital stock or other voting
ownership interests is owned or controlled directly or indirectly by such Person or by one or more
of the Subsidiaries of such Person or by a combination thereof.

     “Tax Separation Agreement” means the Tax Separation Agreement attached as Exhibit A to the
Master Separation Agreement.

     (b) Each of the following terms is defined in the Section set forth opposite such term:

	 	 	 
	TERM	 	SECTION
	Annual Budget
	 	8.01
	Actions
	 	4.04(a)
	Applicable Insurance
	 	6.11(a)
	Benefit Billing
	 	3.01
	Benefits Services
	 	3.05(b)
	Billing Party
	 	3.02
	Class A common shares
	 	Preamble
	Class B common shares
	 	Preamble
	Committee
	 	7.01
	Coverage Amount
	 	6.06(a)(i)
	Customary Billing
	 	3.01
	DSW Covered Parties
	 	6.01(a)
	DSW Inc.
	 	Preamble
	DSW Indemnified Person
	 	4.03(b)
	DSW/RVI
Shared Asset
	 	7.05
	RVI
Dedicated Asset
	 	7.05
	RVI Shared
Asset
	 	7.05
	DSW Service Costs
	 	3.01
	Employee Welfare Plans
	 	4.02
	Force Majeure
	 	9.06(a)
	Initial Term
	 	5.01
	Insurance Transition Period
	 	6.01(a)
	Net Sales Ratio
	 	3.04
	Offering
	 	Preamble
	Overallocated Party
	 	6.06(a)(iii)
	Parties
	 	Preamble
	Party
	 	Preamble
	Pass-Through Billing
	 	3.01
	Payment Date
	 	3.06(b)
	Percent of Sales Billing
	 	3.01
	Prior Agreements
	 	9.01
	Receiving Party
	 	3.02
	Registration Statement
	 	Preamble
	Retail Ventures
	 	Preamble
	Retail Ventures Indemnified Person
	 	4.03(a)
	Retail Ventures Insurance Policies
	 	6.01(a)
	Retail Ventures Plans
	 	3.05(a)
	Retail Ventures Service Costs
	 	3.01
	RVI
Dedicated Asset
	 	7.05
	RVI Shared Asset
	 	7.05
	Service Costs
	 	3.06(a)
	Shared Expenses Agreement
	 	8.03
	Terminated Party
	 	5.03(a)
	Terminating Party
	 	5.03(a)
	Underallocated Party
	 	6.06(a)(iii)

4

 

     SECTION 1.02. Internal References. Unless the context indicates otherwise, references to
Articles, Sections and paragraphs shall refer to the corresponding articles, sections and
paragraphs in this Agreement and references to the parties shall mean the parties to this
Agreement.

ARTICLE II

PURCHASE AND SALE OF SERVICES

     SECTION 2.01. Purchase and Sale of Retail Ventures Services.

     (a) Subject to the terms and conditions of this Agreement and in consideration of the Retail
Ventures Service Costs described below, Retail Ventures agrees to provide to the applicable DSW
Entities, or to procure the provision to such entities, and DSW agrees to purchase from Retail
Ventures, the Retail Ventures Services. Unless otherwise specifically agreed by Retail Ventures
and DSW, the Retail Ventures Services shall be substantially similar in scope, quality, and nature
to those customarily provided to, or procured on behalf of, the DSW Entities by Retail Ventures
and/or its Subsidiaries prior to the Offering Date.

     (b) The Parties acknowledge and agree that (i) the Retail Ventures Services to be provided by
the applicable Retail Ventures Entities under this Agreement shall, at DSW’s request, be provided
directly to Subsidiaries of DSW
and (ii) Retail Ventures may satisfy its obligation to provide or to procure the Retail
Ventures Services hereunder by causing one or more of its Subsidiaries, including, but not limited
to, RVSI, to provide or to procure such services. With respect to the Retail Ventures Services
provided to, or procured on behalf of, any Subsidiary of DSW, DSW agrees to pay on behalf of such
Subsidiary all amounts payable by or in respect of such services pursuant to this Agreement.

     SECTION 2.02. Purchase and Sale of DSW Services

     (a) Subject to the terms and conditions of this Agreement and in consideration of the DSW
Service Costs described below, DSW agrees to provide to the applicable Retail Ventures Entities, or
to procure the provision to such entities of, and Retail Ventures agrees to purchase from DSW, the
DSW Services. Unless otherwise specifically agreed by Retail Ventures and DSW, (i) the DSW
Services (other than the Information Technology Services) shall be substantially similar in scope,
quality, and nature to those customarily provided to, or procured on behalf of, the Retail Ventures
Entities by DSW and/or its Subsidiaries prior to the Offering Date, and (ii) the Information
Technology Services shall be, at a minimum, substantially similar in scope, quality, and nature to
those customarily provided to, or procured on behalf of, the Retail Ventures Entities by Retail
Ventures and/or its Subsidiaries prior to the Information Technology Services Transfer Date.

     (b) The Parties acknowledge and agree that (i) the DSW Services to be provided by the
applicable DSW Entities on behalf of Retail Ventures under this Agreement shall, at Retail
Ventures’ request, be provided directly to Subsidiaries of Retail Ventures and (ii) DSW may satisfy
its obligation to provide or to procure the DSW Services hereunder by causing one or more of its
Subsidiaries to provide or to procure such services. With respect to the DSW Services provided to,
or procured on behalf of, any Subsidiary of Retail Ventures, Retail Ventures agrees to pay on
behalf of such Subsidiary all amounts payable by or in respect of such services pursuant to this
Agreement.

     SECTION 2.03 Additional Services.

     (a) In addition to the Retail Ventures Services to be provided or procured by Retail Ventures
in accordance with Section 2.01, if requested by DSW, and to the extent that Retail Ventures and
DSW may mutually agree, Retail Ventures shall provide additional services (including services not
provided by

5

 

Retail Ventures to the DSW Entities prior to the Offering Date) to DSW. The scope of
any such services, as well as the costs and other terms and conditions applicable to such services,
shall be as mutually agreed by Retail Ventures and DSW.

     (b) In addition to the DSW Services to be provided or procured by DSW in accordance with
Section 2.02, if requested by Retail Ventures, and to the extent that Retail Ventures and DSW may
mutually agree, DSW shall provide additional services (including services not provided by DSW to
the Retail Ventures Entities prior to the Offering Date) to Retail Ventures. The scope of any such
services, as well as the costs and other terms and conditions applicable to such services, shall be
as mutually agreed by Retail Ventures and DSW.

ARTICLE III

SERVICE COSTS; OTHER CHARGES

     SECTION 3.01. Service Costs Generally. The Schedules hereto indicate, with respect to the
DSW Services and the Retail Ventures Services, respectively, listed therein, whether the costs to
be charged for Services are to be determined by (i) the customary billing method described in
Section 3.02 (“Customary Billing”), (ii) the pass-through billing method described in Section 3.03
(“Pass-Through Billing”), (iii) the percentage of net sales method described in Section 3.04
(“Percent of Sales Billing”), (iv) a calculation of certain costs related to employee benefit plans
and benefit arrangements described in Section 3.05 (“Benefit Billing”), or (v) another specified
method. Unless otherwise indicated on the Schedules, the Customary Billing method will apply. The
costs to be paid by DSW to Retail Ventures for Retail Venture Services are collectively referred to
herein as the “Retail Ventures Service Costs”. DSW agrees to pay to Retail Ventures in the manner
set forth in Section 3.06 an amount equal to the Retail Ventures Service Costs applicable to each
of the Retail Ventures Services provided or procured by Retail Ventures. The costs to be paid by
Retail Ventures to DSW for the DSW Services are collectively referred to herein as the “DSW Service
Costs”. Retail Ventures agrees to pay to DSW in the manner set forth in Section 3.06 an amount
equal to the DSW Service Costs applicable to each of the DSW Services provided or procured by DSW.

     SECTION 3.02. Customary Billing. The costs of Services as to which the Customary Billing
method applies shall be equal to the costs customarily charged and/or allocated by one Party and/or
one or more of its Subsidiaries or Departments (the “Billing Party”) to the other Party and/or one
or more of its Subsidiaries or Departments (the “Receiving Party”) immediately prior to the
Information Technology Services Transfer Date (it being understood that from and after the
Information Technology Services Transfer Date such costs may be increased by the Billing Party in a
manner consistent with the manner in which such costs were increased from time to time prior to the
Information Technology Services Transfer Date, and consistent with the semi-annual reconciliation
described in Section 8.01).

     SECTION 3.03. Pass-Through Billing. The costs of Services as to which the Pass-Through
Billing method applies shall be equal to the aggregate amount of third-party, out-of-pocket costs
and expenses incurred by a Billing Party on behalf of a Receiving Party (which costs shall include
but not be limited to the costs incurred in connection with obtaining the consent of any party to a
contract or agreement to which any Billing Party is a party where such consent is related to and
reasonably required for the provision of any Service). It is intended that Services provided by
third parties will be billed directly to the Receiving Party by the third party; however, if a
Billing Party incurs any such costs or expenses on behalf of any Receiving Party as well as
businesses operated by the Billing Party, the Billing Party shall allocate any such costs or
expenses in good faith between the various businesses on behalf of which such costs or expenses
were incurred as set

6

 

forth on any Schedule hereto or, if not set forth on a Schedule, then as the
Billing Party shall determine in the exercise
of the Billing Party’s reasonable judgment. The Billing Party shall apply usual and accepted
accounting conventions in making such allocations, and the Billing Party or its agents shall keep
and maintain such books and records as may be reasonably necessary to make such allocations. The
Billing Party shall make copies of such books and records available to the Receiving Party upon
request and with reasonable notice.

     SECTION 3.04. Percent of Sales Billing. Services for which the billing methodology is the
Percent of Sales Billing method shall not be billed individually. Instead, the Billing Party shall
provide all such services for an aggregate annual cost equal to the amount obtained by multiplying
(x) the Billing Party’s projected budget for all services which are the same or similar to the
applicable Services which are to be provided to all Retail Ventures Entities and DSW Entities for
the relevant year, by (y) the projected net sales for the year of the Receiving Party Entities
divided by the aggregate projected net sales of all Retail Ventures Entities and DSW Entities (the
“Net Sales Ratio”). At the end of the applicable fiscal year, actual expenses versus budgeted
expenses for the relevant Service shall be compared and any overage or shortfall shall be allocated
based upon the Net Sales Ratio. The Billing Party’s budget for Services to be provided to the
Receiving Party Entities as contemplated by this Section 3.04 shall be determined on a basis
consistent with the manner in which the Billing Party determines the similar budgets for the
Billing Party Entities.

     SECTION 3.05. Benefit Billing.

     (a) Prior to the Offering Date, certain associates of DSW participated in certain benefit
plans sponsored by Retail Ventures (“Retail Ventures Plans”). On and after the Offering Date, DSW
associates shall continue to be eligible to participate in the Retail Ventures Plans, subject to
the terms of the governing plan documents as interpreted by the appropriate plan fiduciaries. On
and after the Offering Date, subject to regulatory requirements and the provisions of Section 4.01
hereof, Retail Ventures shall continue to provide Benefit Services (as hereafter defined) to and in
respect of DSW associates with reference to Retail Ventures Plans as administered by Retail
Ventures prior to the Offering Date.

     (b) The costs payable by DSW for Retail Ventures Services relating to the administration of
employee plans and benefit arrangements, which are included in Human Resources in Schedule I
(“Benefit Services”), shall be determined and billed as set forth in Schedule I. The Parties
acknowledge and agree that some of the costs associated with certain Retail Ventures Plans will be
paid principally through DSW employee payroll deductions for such plans as specified in Schedule I.
The Parties intend that the Retail Ventures Service Costs relating to the performance of Benefit
Services shall not exceed reasonable compensation for such services as defined under applicable
law.

     (c) Each Party may request changes in the applicable terms of or Retail Ventures Services
relating to the Retail Ventures Plans, approval of which shall not be unreasonably withheld;
provided, however, that changes in the terms and provisions of any of the Retail Ventures Plans
shall be in the sole discretion of Retail Ventures. The Parties agree to cooperate fully with
each other in the administration and coordination of regulatory and administrative
requirements associated with Retail Ventures Plans.

     SECTION 3.06. Invoicing and Settlement of Costs.

     (a) Except as otherwise provided in a Schedule to this Agreement or to the extent that Retail
Ventures and DSW may mutually agree, each Billing Party shall invoice or notify the Chief Executive
Officer or Chief Financial Officer of the Receiving Party on a monthly basis (not later than the
tenth day of

7

 

each month), in a manner substantially similar to and consistent with the billing
practices used in connection with services provided by Retail Ventures to the DSW Entities prior to
the Offering Date and, as applicable, the Information Technology Services Transfer Date (except as
otherwise agreed), of the Service Costs related to services performed or procured by the Billing
Party during the prior calendar month. As used herein, “Service Costs” means the Retail Ventures
Service Costs, if Retail Ventures is the Billing Party, and the DSW Service Costs, if DSW is the
Billing Party. In connection with the invoicing described in this Section 3.06(a), the Billing
Party shall provide to the Receiving Party the same billing data and level of detail as customarily
or similar to that provided to the Receiving Party prior to the Offering Date and, as applicable,
the Information Technology Services Transfer Date and such other related data as may be reasonably
requested by the Receiving Party.

     (b) The Receiving Party agrees to pay to the Billing Party, on or before the 30th day after
the date on which the Billing Party delivers to the Receiving Party an invoice or notice of Service
Costs (or the next Business Day, if such 30th day is not a Business Day) (each, a “Payment Date”),
by wire transfer of immediately available funds payable to the order of the Billing Party, all
amounts so invoiced or noticed by the Billing Party pursuant to Section 3.06(a). If the Receiving
Party fails to pay any monthly payment within 30 days of the relevant Payment Date, the Receiving
Party shall be obligated to pay, in addition to the amount due on such Payment Date, interest on
such amount at the prime, or best, rate announced by National City Bank, compounded monthly from
the relevant Payment Date through the date of payment. Payment can be made via check, ACH or wire
and, except as set forth in Section 3.15(c) of the Master Separation Agreement, offsetting is not
permitted.

ARTICLE IV

STANDARD OF PERFORMANCE AND INDEMNIFICATION

     SECTION 4.01.

     (i)General Standard of Service. Except as otherwise agreed to in writing by the Parties or as
described in this Agreement, and provided that a Party is not restricted by contract with third
parties or by applicable law, the Parties agree that (i) the nature, quality, and standard of care
applicable to the delivery of the Services hereunder (other than the Information Technology
Services) shall be substantially the same as or consistent with that applicable to the similar
services provided by a Party to the other Party prior to the Offering Date, and (ii) the nature,
quality, and standard of care applicable to the delivery of the Information Technology Services
hereunder shall be, at a minimum,
substantially the same as or consistent with that applicable to the similar services provided
by or on behalf of Retail Ventures prior to the Information Technology Services Transfer Date.
Retail Ventures shall use its reasonable efforts to ensure that the nature and quality of Services
provided to DSW associates under Retail Ventures Plans, either by Retail Ventures directly or
through administrators under contract, shall be undifferentiated as compared with the same services
provided to or on behalf of Retail Ventures associates under Retail Ventures Plans.

     (ii) Service Level Partnership Agreements. Within ninety (90) days of the date of this
Agreement, DSW will enter into Service Level Partnership Agreements with RVI and/or each RVI
entity, with such agreements to include a description of Information Technology Services provided
to each entity and address minimum standards of service each entity should expect.

     SECTION 4.02. Delegation. Subject to Section 4.01 above, DSW hereby delegates to Retail
Ventures final, binding, and exclusive authority, responsibility, and discretion to interpret and
construe the provisions of employee welfare benefit plans in which associates of DSW Entities have

8

 

elected to participate and which are administered by Retail Ventures under this Agreement
(collectively, “Employee Welfare Plans”). Retail Ventures may further delegate such authority to
other parties to:

          (i) provide administrative and other services;

          (ii) reach factually supported conclusions consistent with the terms of the respective
Employee Welfare Plans;

          (iii) make a full and fair review of each claim denial and decision related to the provision
of benefits provided or arranged for under the Employee Welfare Plans pursuant to the requirements
of ERISA, if within 60 days after receipt of the notice of denial, a claimant requests in writing a
review for reconsideration of such decisions (the party adjudicating the claim shall notify the
claimant in writing of its decision on review and such notice shall satisfy all ERISA requirements
relating thereto); and

          (iv) notify the claimant in writing of its decision on review.

     SECTION 4.03. Limitation of Liability.

     (a) Retail Ventures Entities

          (i) DSW agrees that none of the Retail Ventures Entities and their respective directors,
officers, agents, and employees (each, a “Retail Ventures Indemnified Person”) shall have any
liability, whether direct or indirect, in contract or tort or otherwise, to any DSW Entity or any
other Person for or in connection with the Retail Ventures Services rendered or to be rendered by
any Retail Ventures Indemnified Person pursuant to this Agreement, the transactions contemplated
hereby or any Retail Ventures Indemnified Person’s actions or inactions in connection with any
Retail Ventures Services or such transactions, except for damages which have resulted from such
Retail Ventures Indemnified Person’s gross negligence or willful
misconduct in connection with any Retail Ventures Services, actions or inactions.

          (ii) Notwithstanding the provisions of this Section 4.03(a), none of the Retail Venture
Entities shall be liable for any special, indirect, incidental, or consequential damages of any
kind whatsoever (including, without limitation, attorneys’ fees) in any way due to, resulting from
or arising in connection with any of the Retail Ventures Services or the performance of or failure
to perform Retail Ventures’ obligations under this Agreement. This disclaimer applies without
limitation (1) to claims arising from the provision of the Retail Ventures Services or any failure
or delay in connection therewith; (2) to claims for lost profits; (3) regardless of the form of
action, whether in contract, tort (including negligence), strict liability, or otherwise; and (4)
regardless of whether such damages are foreseeable or whether Retail Ventures has been advised of
the possibility of such damages.

          (iii) None of the Retail Venture Entities shall have any liability to any DSW Entity or any
other Person for failure to perform Retail Ventures’ obligations under this Agreement or otherwise,
where (1) such failure to perform is not caused by the gross negligence or willful misconduct of
the Retail Venture Entity designated to perform such obligations and (2) such failure to perform
similarly affects the Retail Venture Entities receiving the same or similar services and does not
have a disproportionately adverse effect on the DSW Entities, taken as a whole.

          (iv) In addition to the foregoing, DSW agrees that, in all circumstances, it shall use
commercially reasonable efforts to mitigate and otherwise minimize damages to the DSW Entities,
individually and collectively,

9

 

whether direct or indirect, due to, resulting from or arising in
connection with any failure by Retail Ventures to comply fully with Retail Ventures’ obligations
under this Agreement.

     (b) DSW Entities

          (i) Retail Ventures agrees that none of the DSW Entities and their respective directors,
officers, agents, and employees (each, a “DSW Indemnified Person”) shall have any liability,
whether direct or indirect, in contract or tort or otherwise, to any Retail Ventures Entity or any
other Person for or in connection with the DSW Services rendered or to be rendered by any DSW
Indemnified Person pursuant to this Agreement, the transactions contemplated hereby or any DSW
Indemnified Person’s actions or inactions in connection with any DSW Services or such transactions,
except for damages which have resulted from such DSW Indemnified Person’s gross negligence or
willful misconduct in connection with any DSW Services, actions or inactions.

          (ii) Notwithstanding the provisions of this Section 4.03(b), none of the DSW Entities shall be
liable for any special, indirect, incidental, or consequential damages of any kind whatsoever
(including, without limitation, attorneys’ fees) in any way due to, resulting from or arising in
connection with any of the DSW Services or the performance of or failure to perform DSW’s
obligations under this Agreement. This disclaimer applies without limitation (1) to claims arising
from the provision of the DSW Services or any failure or delay in connection therewith; (2) to
claims for lost profits; (3) regardless of the form of action, whether in contract, tort (including
negligence),
strict liability, or otherwise; and (4) regardless of whether such damages are foreseeable or
whether DSW has been advised of the possibility of such damages.

          (iii) None of the DSW Entities shall have any liability to any Retail Ventures Entity or any
other Person for failure to perform DSW’s obligations under this Agreement or otherwise, where (1)
such failure to perform is not caused by the gross negligence or willful misconduct of the DSW
Entity designated to perform such obligations and (2) such failure to perform similarly affects the
DSW Entities receiving the same or similar services and does not have a disproportionately adverse
effect on the Retail Ventures Entities, taken as a whole.

          (iv) In addition to the foregoing, Retail Ventures agrees that, in all circumstances, it shall
use commercially reasonable efforts to mitigate and otherwise minimize damages to Retail Ventures
Entities, individually and collectively, whether direct or indirect, due to, resulting from or
arising in connection with any failure by DSW to comply fully with DSW’s obligations under this
Agreement.

     SECTION 4.04. Indemnification Related to Retail Ventures Services.

     (a) DSW agrees to indemnify and hold harmless each Retail Ventures Indemnified Person from and
against any damages related to, and to reimburse each Retail Ventures Indemnified Person for all
reasonable expenses (including, without limitation, attorneys’ fees) as they are incurred in
connection with investigating, preparing, pursuing, or defending, any third party claim, action,
proceeding, or investigation, whether or not in connection with pending or threatened litigation
and whether or not any DSW Indemnified Person or any Retail Ventures Indemnified Person is a party
(collectively, “Actions”), arising out of or in connection with Retail Ventures Services rendered
or to be rendered by any Retail Ventures Indemnified Person pursuant to this Agreement, the
transactions contemplated hereby or any Retail Ventures Indemnified Person’s actions or inactions
in connection with any such Retail Ventures Services or transactions; provided that, DSW shall not
be responsible for any damages incurred by any Retail Ventures Indemnified Person that have
resulted from such Retail Ventures Indemnified Person’s gross negligence or willful misconduct in
connection with any of the advice, actions, inactions,

10

 

or Retail Ventures Services referred to
above (it being understood and agreed that the provision by any Retail Venture Entity of any of the
Retail Ventures Services contemplated by Schedule I hereof without obtaining the consent of any
party to any Contract or agreement to which any Retail Ventures Entity is a party as of the date
hereof shall not constitute gross negligence or willful misconduct by any Retail Ventures Entity,
provided that, the relevant Retail Ventures Entity has used commercially reasonable efforts to
obtain such consent).

     (b) Except as set forth in Section 4.04(c), Retail Ventures agrees to indemnify and hold
harmless each DSW Indemnified Person from and against any damages related to, and to reimburse each
DSW Indemnified Person for all reasonable expenses as they are incurred in connection with
investigating, preparing, or defending, any third party Action arising out of or related to the
gross negligence or willful misconduct of any Retail Ventures Indemnified Person in connection with
the Retail Ventures Services rendered or to be rendered pursuant to this Agreement.

     (c) To the extent that any other Person has agreed to indemnify any Retail Ventures
Indemnified Person or to hold a Retail Ventures Indemnified Person harmless and such Person
provides services to Retail Ventures or any affiliate of Retail Ventures relating directly or
indirectly to any employee plan or benefit arrangement for which Benefit Services are provided
under this Agreement, Retail Ventures will exercise reasonable efforts (x) to make such agreement
applicable to any DSW Indemnified Person so that each DSW Indemnified Person is held harmless or
indemnified to the same extent as any Retail Ventures Indemnified Person and (y) to make available
to each DSW Indemnified Person the benefits of such agreement.

     SECTION 4.05. Indemnification Related to DSW Services.

     (a) Retail Ventures agrees to indemnify and hold harmless each DSW Indemnified Person from and
against any damages related to, and to reimburse each DSW Indemnified Person for all reasonable
expenses (including, without limitation, attorneys’ fees) as they are incurred in connection with
investigating, preparing, pursuing, or defending, any third party Action arising out of or in
connection with DSW Services rendered or to be rendered by any DSW Indemnified Person pursuant to
this Agreement, the transactions contemplated hereby or any DSW Indemnified Person’s actions or
inactions in connection with any such DSW Services or transactions; provided that, Retail Ventures
shall not be responsible for any damages incurred by any DSW Indemnified Person that have resulted
from such DSW Indemnified Person’s gross negligence or willful misconduct in connection with any of
the advice, actions, inactions, or DSW Services referred to above (it being understood and agreed
that the provision by any DSW Entity of any of the DSW Services contemplated by Schedule II hereof
without obtaining the consent of any party to any Contract or agreement to which any DSW Entity is
a party as of the date hereof shall not constitute gross negligence or willful misconduct by any
DSW Entity, provided that, the relevant DSW Entity has used commercially reasonable efforts to
obtain such consent).

     (b) DSW agrees to indemnify and hold harmless the Retail Ventures Indemnified Persons from and
against any damages related to, and to reimburse each Retail Ventures Indemnified Person for all
reasonable expenses as they are incurred in connection with investigating, preparing, or defending,
any third party Action arising out of or related to the gross negligence or willful misconduct of
any DSW Indemnified Person in connection with the DSW Services rendered or to be rendered pursuant
to this Agreement.

11

 

ARTICLE V

TERM AND TERMINATION

     SECTION 5.01. Term. The Initial Agreement was in effect from January 30, 2005 through the
Agreement Date. Except as otherwise provided in this Article V, or in Section 9.06 or as otherwise
agreed in writing by the Parties, (a) this Agreement, (i) as it relates to all Services other than
the Shoe Processing Services, shall have an initial term from the Agreement Date through January
31, 2008, and (ii) as it relates to the Shoe Processing Services, shall have an initial term from
the Agreement Date through January 31, 2011 (in each case, the “Initial Term”), and will be renewed
automatically after the applicable Initial Terms for successive one-year terms unless either Party
elects not to renew this Agreement by notice in writing to the other Party not less than one
hundred and eighty (180) days prior to the end of any term, and (b) a Party’s obligation to provide
or to procure, and the other Party’s obligation to purchase, a Service shall cease as of the
applicable date set forth in the applicable Schedules or such earlier date determined in accordance
with Section 5.02.

     SECTION 5.02. Termination.

     (a) Except as otherwise provided herein or in any Schedule hereto, the Parties may by mutual
agreement from time to time terminate this Agreement with respect to one or more of the Services,
in whole or in part.

     (b) Retail Ventures may terminate any DSW Service at any time if DSW shall have failed to
perform any of its material obligations under this Agreement relating to such DSW Service, Retail
Ventures shall have notified DSW in writing of such failure and such failure shall have continued
for a period of at least thirty (30) days after receipt by DSW of written notice of such failure
from Retail Ventures.

     (c) DSW may terminate any Retail Ventures Service at any time if Retail Ventures shall have
failed to perform any of its material obligations under this Agreement relating to such Retail
Ventures Service, DSW shall have notified Retail Ventures in writing of such failure, and such
failure shall have continued for a period of at least thirty (30) days after receipt by Retail
Ventures of written notice of such failure from DSW.

     (d) On or after October 1, 2007, either Retail Ventures or DSW may terminate the Shoe
Processing Services by giving written notice of such termination to the other Party. Termination
of the Shoe Processing Services shall be effective not less than nine (9) months after the date of
any such termination notice or on any later date that may be specified in such notice.

     SECTION 5.03. Effect of Termination.

     (a) Other than as required by law, upon termination of any Service pursuant to Section 5.02,
or upon termination of this Agreement in accordance with its terms, the Party whose Service is
terminated (the “Terminated Party”) shall have no further obligation to provide the terminated
Service (or any Service, in the case of termination of this Agreement) and the Party terminating
such Service (the “Terminating Party”) shall have no obligation to pay any fees relating to such
terminated Services or to make any other payments hereunder; provided that, notwithstanding such
termination, (i) the Terminating Party shall remain liable to the Terminated Party for fees owed
and payable in respect of Services provided prior to the effective date of the termination; (ii)
the Terminated Party shall continue to charge the Terminating Party for administrative and program
costs relating to benefits paid after but incurred prior to the termination of any Service and
other services required to be provided after the termination of such Service, and the Terminating
Party shall be obligated to pay such expenses in accordance with the terms of this Agreement; and
(iii) the provisions of Articles 4, 5,

12

 

and 9 shall survive any such termination indefinitely. All
program and administrative costs attributable to associates of any DSW Entity under Retail Ventures
Plans that relate to any period after the effective date of any such termination shall be for the
account of and paid by DSW.

     (b) Following termination of this Agreement with respect to any Service provided or procured
by a Party, the Parties agree to cooperate with each other in providing for an orderly transition
of such Service to the other Party or to a successor service provider as designated by the other
Party. Without limiting the foregoing, Retail Ventures agrees to (i) provide to DSW, within 30
days of the termination of any Benefit Service, in a usable format designated by Retail Ventures,
copies of all records relating directly or indirectly to benefit determinations with respect to any
and all associates of a DSW Entity, including, but not limited to, compensation and service
records, correspondence, plan interpretive policies, plan procedures, administration guidelines,
minutes, and any data or records required to be maintained by law and (ii) work with DSW in
developing a transition schedule with respect to such terminated Benefit Service.

ARTICLE VI

INSURANCE MATTERS

     SECTION 6.01. DSW Insurance Coverage During Transition Period.

     (a) As of the Offering Date, Retail Ventures shall maintain insurance coverage under the
Insurance Policies listed in Part (a) of Schedule III (the “Retail Ventures Insurance Policies”).
Throughout the period beginning on the Offering Date and ending upon the earlier of (i) termination
of the Service provided pursuant to this Article VI or (ii) termination or expiration of this
Agreement in accordance with its terms (the “Insurance Transition Period”), Retail Ventures shall,
subject to insurance market conditions and other factors beyond its control, maintain Insurance
Policies covering and for the benefit of the DSW Entities and their respective directors, officers,
and employees (collectively, the “DSW Covered Parties”) which are comparable to those maintained
generally by Retail Ventures covering the DSW Covered Parties prior to the Offering Date; provided,
however, that if Retail Ventures determines that (i) the amount or scope of such insurance coverage
will be reduced to a level materially inferior to the level of insurance coverage in existence
immediately prior to the Insurance Transition Period or (ii) the retention or deductible level
applicable to such insurance coverage, if any, will be increased to a level materially greater than
the levels in existence immediately prior to the Insurance Transition Period, each other than as a
result of the Offering, Retail Ventures shall give DSW notice of such determination as promptly as
practicable. Upon notice of such determination, DSW shall be entitled to no less than sixty (60)
days to evaluate DSW’s options regarding continuance of insurance coverage under said Insurance
Policies and DSW may cancel the DSW Entities’ interest in all or any portion of such insurance
coverage as of any day within such sixty (60) day period.

     (b) DSW shall promptly pay or reimburse Retail Ventures, as the case may be, for premium
expenses, deductibles or retention amounts, and any other costs and expenses which Retail Ventures
may incur in connection with the insurance coverages maintained pursuant to this Section 6.01,
including but not limited to any retroactive or subsequent premium adjustments. DSW’s share of
such costs and expenses shall be calculated as set forth in Part (b) of Schedule III.

     SECTION 6.02. Cooperation; Payment of Insurance Proceeds to DSW; Agreement Not to Release
Carriers. Each Party shall share such information as is reasonably necessary in order to permit the
other Party to manage and conduct its insurance matters in an orderly fashion. Retail Ventures, at
the request of DSW, shall cooperate with and use commercially reasonable efforts to assist DSW in
recovering Insurance Proceeds under the Retail Ventures

13

 

Insurance Policies for claims relating to
the DSW Business, the assets of DSW or DSW Liabilities, whether such claims arise under any
Contract or agreement, by operation of law or otherwise, existing or arising from any past acts or
events occurring or failing to occur or alleged to have occurred or to have failed to occur or any
conditions existing or alleged to have existed before the Offering Date, on the Offering Date or
during the Insurance Transition Period, and Retail Ventures
shall promptly pay any such recovered
Insurance Proceeds to DSW. Neither Retail Ventures nor DSW, nor any of their respective
Subsidiaries, shall take any action which would intentionally jeopardize or otherwise interfere
with the other Party’s ability to collect any proceeds payable pursuant to any Insurance Policy.
Except as otherwise contemplated by this Agreement or any other agreement between the Parties,
after the Offering Date, neither Retail Ventures nor DSW (and each Party shall ensure that no
affiliate of such Party), without the consent of the other Party, shall provide any insurance
carrier with a release, or amend, modify or waive any rights under any such policy or agreement, if
such release, amendment, modification or waiver would adversely affect any rights or potential
rights of the other Party (or its Subsidiary) thereunder. However, nothing in this Section 6.02
shall (A) preclude any Retail Ventures Entity or any DSW Entity from presenting any claim or from
exhausting any policy limit, (B) require any Retail Ventures Entity or any DSW Entity to pay any
premium or other amount or to incur any Liability, or (C) require any Retail Ventures Entity or DSW
Entity to renew, extend or continue any policy in force.

     SECTION 6.03. DSW Insurance Coverage After the Insurance Transition Period. From and after
expiration of the Insurance Transition Period, DSW shall be responsible for obtaining and
maintaining insurance programs for the DSW Entities’ risk of loss and such insurance arrangements
shall be separate and apart from Retail Ventures’ insurance programs.

     SECTION 6.04. Deductibles and Self-Insured Obligations. DSW shall reimburse Retail Ventures
for all amounts necessary to exhaust or otherwise to satisfy all applicable self-insured
retentions, amounts for fronted policies, deductibles and retrospective premium adjustments and
similar amounts not covered by Insurance Policies in connection with DSW Liabilities and Insured
DSW Liabilities to the extent that Retail Ventures is required to pay any such amounts.

     SECTION 6.05. Procedures with Respect to Insured DSW Liabilities.

     (a) DSW shall reimburse Retail Ventures for all amounts incurred to pursue insurance
recoveries from Insurance Policies for Insured DSW Liabilities.

     (b) The defense of claims, suits or actions giving rise to potential or actual Insured DSW
Liabilities shall be managed (in conjunction with Retail Ventures’ insurers, as appropriate) by the
Party that would have had
responsibility for managing such claims, suits or actions had such Insured DSW Liabilities
been DSW Liabilities.

     SECTION 6.06. Insufficient Limits of Liability for Retail Ventures Liabilities and DSW
Liabilities.

     (a) In the event that there are insufficient limits of liability available under Retail
Ventures’ Insurance Policies in effect prior to the Distribution Date to cover the Liabilities of
Retail Ventures and/or DSW that would otherwise be covered by such Insurance Policies, then to the
extent that other insurance is not available to Retail Ventures and/or DSW for such Liabilities an
adjustment will be made in accordance with the following procedures:

          (i) To the extent the Parties are able to specifically quantify and verify the actual
Liabilities incurred by each Party to the exclusion

14

 

of the other Party, each Party will be
allocated an amount equal to the product of (A) the actual Liabilities incurred by such Party,
divided by the total actual Liabilities incurred by the Parties, times (B) the lesser of (1) the
available limits of liability under Retail Ventures’ Insurance Policies in effect prior to the
Distribution Date net of uncollectible amounts attributable to insurer insolvencies and (2) the
proceeds received from Retail Ventures’ Insurance Policies if the Liabilities are the subject of
disputed coverage claims and, following consultation with each other, Retail Ventures and/or DSW
agree to accept less than full policy limits from Retail Ventures’ and DSW’s insurers (such
available limits and/or proceeds being referred to as the “Coverage Amount”).

     (ii) To the extent that the Parties are unable to specifically quantify and verify any such
Liabilities or any part of such Liabilities to each Party (to the exclusion of the other Party),
each Party will be allocated an amount equal to their shared percentage of the Coverage Amount.

     (iii) A Party who receives more than its share of the Coverage Amount (the “Overallocated
Party”) agrees to reimburse the other Party (the “Underallocated Party”) to the extent that the
Liabilities of the Underallocated Party that would have been covered under such Insurance
Policies is less than the Underallocated Party’s share of the Coverage Amount.

     (iv) This Section 6.06 shall terminate ten (10) years following the end of the Insurance
Transition Period, unless terminated sooner in accordance with the provisions of this Agreement.

     SECTION 6.07. Cooperation. Retail Ventures and DSW shall cooperate with each other in all
respects, and shall execute any additional documents which are reasonably necessary, to effectuate
the provisions of this Article VI.

     SECTION 6.08. No Assignment or Waiver. This Agreement shall not be considered as an
attempted assignment of any policy of insurance or as a contract of insurance and shall not be
construed to waive any right or remedy of any Retail Ventures Entity in respect of any
Insurance Policy or any other contract or policy of insurance.

     SECTION 6.09. No Liability. DSW does hereby, for itself and as agent for each other DSW
Entity, agree that no Retail Ventures Entity or Retail Ventures Indemnified Person shall have any
Liability whatsoever as a result of the insurance policies and practices of Retail Ventures and its
Subsidiaries as in effect at any time prior to the end of the Insurance Transition Period,
including as a result of the level or scope of any such insurance, the creditworthiness of any
insurance carrier, the terms and conditions of any policy, or the adequacy or timeliness of any
notice to any insurance carrier with respect to any claim or potential claim or otherwise.

     SECTION 6.10. Additional or Alternate Insurance. Notwithstanding any other provision of this
Agreement, during the Insurance Transition Period, Retail Ventures and DSW shall work together to
evaluate insurance options and secure additional or alternate insurance for DSW and/or Retail
Ventures if desired by and cost effective for DSW and Retail Ventures. Nothing in this Agreement
shall be deemed to restrict any DSW Entity from acquiring at its own expense any other Insurance
Policy in respect of any Liabilities or covering any period.

     SECTION 6.11. Forbearance and Prior Insurance Coverage.

     (a) From and after the date of this Agreement, Retail Ventures shall not, and shall cause each
of its Subsidiaries not to, take or fail to take any action if such action or inaction, as the case
may be, would adversely affect

15

 

the applicability of any insurance in effect on the effective date
of this Agreement that covers all or any part of the assets, liabilities, business or employees of
any DSW Entity with respect to events occurring prior to the Offering Date (“Applicable
Insurance”), it being understood that in no event shall any Retail Venture Entity be obligated to
pay premiums with respect to periods after the Offering Date in respect of Applicable Insurance.

     (b) Retail Ventures agrees that, from and after the Offering Date, all Applicable Insurance
directly or indirectly applicable to any assets, liabilities, business or employees of any DSW
Entity shall be for the benefit of the DSW Entity, it being understood that such Applicable
Insurance shall also be for the benefit of the Retail Venture Entities to the extent directly or
indirectly applicable to any assets, liabilities, business or employees of the Retail Venture
Entities. Without limiting the generality of the foregoing, upon DSW’s reasonable request, Retail
Ventures shall use its reasonable efforts to modify, amend or assign all Applicable Insurance
policies and arrangements so that DSW is the direct beneficiary of such Applicable Insurance with
all rights to enforce, obtain the benefit of and take all other action in respect of such
Applicable Insurance; provided that, if the modifications, amendments or assignments contemplated
by this Section 6.11(b) are not permissible, Retail Ventures shall, and shall cause each of its
Subsidiaries to, use its reasonable efforts to enter into such other arrangements as DSW may
reasonably request to ensure that DSW and the Subsidiaries of DSW are entitled to the benefit (to
the fullest extent set forth in the relevant policies and arrangements) of any Applicable
Insurance.

     SECTION 6.12. Further Agreements. The Parties acknowledge that they intend to allocate
financial obligations without violating any laws regarding insurance, self-insurance or other
financial responsibility. If it is determined that any action undertaken pursuant to this
Agreement or any related agreement is violative of any insurance, self-insurance or related
financial responsibility law or regulation, the Parties agree to work together to do whatever is
necessary to comply with such law or regulation while trying to accomplish, as much as possible,
the allocation of financial obligations as intended in this Agreement or any such related
agreement.

ARTICLE VII

INFORMATION TECHNOLOGY EXECUTIVE STEERING COMMITTEE

     SECTION 7.01. Formation. Not later than 10 business days after the Agreement Date, the
Parties shall appoint members to an information technology executive steering committee (the
“Committee”) which shall consist of: three (3) members appointed by DSW; three (3) members
appointed by Retail Ventures; and the Chairman of each of DSW and RVI and his or her designee. A
member appointed by DSW shall chair the Committee. If either Party decides at any time to replace
an appointed Committee member, it may do so by written notice to the other Party.

     SECTION 7.02. Meetings. The Committee shall meet, in person and/or by telephone, at such
times and places as it may select but, in any event, it shall meet at least twice per year
thereafter. Reasonable notice must be given in advance of all meeting dates. The first such
meeting shall be held as soon as practicable, but in no event later than ninety (90) days after the
Information Technology Services Transfer Date. To constitute a quorum for purposes of Committee
decisions, each Party must be represented by at least two of the three members appointed by each
Party. Committee members can give their proxy for voting on Committee decisions to other Committee
members.

     SECTION 7.03. Purpose; Agenda; Minutes. As of the Information Technology Services Transfer
Date, the Committee shall be responsible for identifying and reaching agreement on annual and
interim proposed changes to

16

 

the information technology infrastructure and information technology
services to be maintained and provided by DSW, and, as necessary, the billing methodologies .
Minutes of each Committee meeting shall be recorded.

     SECTION 7.04. Budget/Proposals. Prior to December 31, 2006 and each subsequent year so long
as this Agreement is in effect, the Parties agree to work together and to cooperate with each other
in good faith to develop an annual budget (“IT Annual Budget”) to reflect the estimated annual
Service Costs to each Party
for each of the Information Technology Services to be provided and/or procured by the other
Party as contemplated by this Agreement. In the budgeting process, the Parties agree to use their
reasonable efforts to harmonize the interests of the Parties to have quality services at affordable
costs and to recover the costs of performing and/or procuring the Services. On or before December
31 of each calendar year, an Annual Budget for the next calendar year shall be submitted to the
Committee for review and approval. The Committee may make exceptions to the billing methodologies
described on Schedule II and in Article III. Additionally, either Party may present to the
Committee an interim proposal for a specific change to DSW’s information technology infrastructure,
and any such proposal shall include, at a minimum, (a) a statement of the anticipated outcomes of
the proposed change, (b) an identification of the human resources, facilities and equipment that
would be required to implement the proposed change, (c) a budget for the proposed change and a
proposed allocation of the cost of the proposed change between the Parties, and (d) an estimated
time schedule for implementation of the proposed change. The Committee may request additional
information, accept a proposal as presented, accept a proposal subject to mutually agreed upon
modifications, or reject a proposal. If a Party’s proposal is rejected, then the proposing Party
shall nevertheless be free to implement the proposal independently so long as such implementation
has no cost or material adverse impact on the other Party.

      SECTION 7.05. Information Technology Capital Expenditures. Before DSW shall be obligated to
acquire any new or replacement information technology asset (equipment, computer software, etc.)
that will be used for the benefit of any Retail Ventures Entity, the Committee shall determine
whether such asset is a shared asset to be used for the benefit of one or more of the Retail
Ventures Entities and one or more of the DSW Entities (each, a “DSW/RVI Shared Asset”), a shared
asset that will be used primarily for the benefit of two or more of the Retail Ventures Entities
(each, an “RVI Shared Asset”) or a dedicated asset that will be used primarily for the benefit of a
single Retail Ventures Entity (each, an “RVI Dedicated Asset”).

     (a) DSW shall retain title to each DSW/RVI Shared Asset and to each RVI Shared Asset and shall
recover the cost of each such asset in accordance with Sections 5 and 6 of Schedule II hereto.
Retail Ventures hereby gives DSW the guarantee set forth in Schedule IV of timely payment by each
of the Retail Ventures Entities of the amounts described in Sections 5 and 6 of Schedule II hereto
that are applicable to each DSW/RVI Shared Asset and each RVI Shared Asset.

     (b) Each RVI Dedicated Asset will be treated as follows:

     (i) Promptly upon acquisition by DSW of an RVI Dedicated Asset that is to be used at a
facility of a Retail Ventures Entity (e.g., a point-of-sale device) or an RVI Dedicated Asset that
is to be provided to an employee of a Retail Ventures Entity (e.g., a laptop computer), DSW shall
transfer title to such RVI Dedicated Asset to the applicable Retail Ventures Entity, and the
applicable Retail Ventures Entity shall reimburse DSW for the purchase price, license fee and/or
other consideration paid by DSW for such asset not later than thirty (30) days after acquisition of
such asset. Retail Ventures hereby gives to DSW the guarantee set forth in Schedule IV of timely
payment to DSW by the applicable Retail Ventures Entity of the
purchase price, license fee and/or other consideration paid by DSW for each RVI Dedicated Asset; and

     (ii) DSW shall retain title to any RVI Dedicated Asset that is to be used at a DSW data center
or other DSW facility and shall recover the cost of such RVI Dedicated Asset in accordance with
Sections 5 and 6 of Schedule II hereto. Retail Ventures hereby gives to DSW the guarantee set
forth in Schedule IV of timely payment to DSW by the applicable Retail Ventures Entity of such
amounts, and Retail Ventures hereby agrees to purchase each RVI Dedicated Asset from DSW, for an
amount equal to the net book value of such RVI Dedicated Asset on the date of purchase by Retail
Ventures, on the earliest date that such RVI Dedicated Asset is no longer used for the benefit of
the Retail Ventures Entity due to the sale of the equity or of all or substantially all of the
assets of such Retail Ventures Entity, the cessation of operations of such Retail Ventures Entity
or a strategic decision by such Retail Ventures Entity to cease use of such RVI Dedicated Asset.

ARTICLE VIII

ADDITIONAL AGREEMENTS

     SECTION 8.01. Annual Budget. Prior to December 31, 2006 and each subsequent year so long as
this Agreement is in effect, the Parties agree to work together and to cooperate with each other in
good faith to develop an annual budget (“Annual Budget”) to reflect the estimated annual Service
Costs to each Party for each of the Services to be provided and/or procured by the other Party as
contemplated by this Agreement. In the budgeting process, the Parties agree to use their
reasonable efforts to harmonize the interests of the Parties to have quality services at affordable
costs and to recover the costs of performing and/or procuring the Services. On or before December
31 of each calendar year, an Annual Budget for the next calendar year shall be submitted to the
respective Controller or Chief Financial Officer of each of the Parties for review and approval.
Such approval shall constitute approval of the Annual Budget by the Party represented by such
person. During the months of July and January of each year so long as this Agreement is in effect,
the Parties shall conduct a semi-annual reconciliation of actual Service Costs to budgeted Service
Costs to determine if there are any significant discrepancies between such costs and, if so,
whether the payments for services should be adjusted accordingly.

     SECTION 8.02. Employment Matters. During the Initial Term, neither Party shall, directly or
indirectly, solicit active employees of the other Party without the other Party’s consent; provided
that each Party agrees to give such consent if such Party believes, in good faith, that its consent
is necessary to avoid the resignation of an employee from one Party that the other Party would like
to employ.

     SECTION 8.03. Shared Expenses Agreement. The Parties agree to share certain costs and
expenses related to the store facilities located at Four

17

 

Union Square, New York, New York, pursuant
to the terms and conditions set forth in the Shared Expenses Agreement between the Parties (the
“Shared Expenses Agreement”).

ARTICLE VIII

MISCELLANEOUS

     SECTION 9.01. Prior Agreements. In the event there is any conflict between the provisions of
this Agreement, on the one hand, and the provisions of prior services agreements among any Retail
Venture Entity and any DSW Entity (the “Prior Agreements”), on the other hand, the provisions of
this Agreement shall govern and such provisions in the Prior Agreements are deemed to be amended so
as to conform with this Agreement.

     SECTION 9.02. Other Agreements. In the event there is any inconsistency between the
provisions of this Agreement and the respective provisions of the Master Separation Agreement, the
Tax Separation Agreement and the Exchange Agreement, respectively, the respective provisions of the
Master Separation Agreement, the Tax Separation Agreement and the Exchange Agreement shall govern.

     SECTION 9.03. Future Litigation and Other Proceedings. In the event that DSW (or any of its
Subsidiaries or any of its or their respective officers or directors) or Retail Ventures (or any of
its Subsidiaries or any of its or their respective officers or directors) at any time after the
date hereof initiates or becomes subject to any litigation or other proceedings before any
governmental authority or arbitration panel with respect to which the Parties have no prior
agreements (as to indemnification or otherwise), the Party (and its Subsidiaries and its and their
respective officers and directors) that has not initiated and is not subject to such litigation or
other proceedings shall comply, at the other Party’s expense, with any reasonable requests by the
other Party for assistance in connection with such litigation or other proceedings (including by
way of provision of information and making available of associates or employees as witnesses). In
the event that DSW (or any of its Subsidiaries or any of its or their respective officers or
directors) and Retail Ventures (or any of its Subsidiaries or any of its or their respective
officers or directors) at any time after the date hereof initiate or become subject to any
litigation or other proceedings before any governmental authority or arbitration panel with respect
to which the Parties have no prior agreements (as to indemnification or otherwise), each Party (and
its officers and directors) shall, at their own expense, coordinate their strategies and actions
with respect to such litigation or other proceedings to the extent such coordination would not be
detrimental to their respective interests and shall comply, at the expense of the requesting Party,
with any reasonable requests of the other Party for assistance in connection therewith (including
by way of provision of information and making available of employees as witnesses).

     SECTION 9.04. No Agency. Nothing in this Agreement shall constitute or be deemed to
constitute a partnership or joint venture between the Parties hereto or, except to the extent
provided in Section 4.02, constitute or be deemed to constitute any Party the agent or employee of
the other Party for any purpose whatsoever, and neither Party shall have authority or power to bind
the other Party or to contract in the name of, or create a liability against, the other Party in
any way or for any purpose.

     SECTION 9.05. Subcontractors. Either Retail Ventures or DSW may hire or engage one or more
subcontractors to perform all or any of its obligations under this Agreement; provided that,
subject to Section 4.03, Retail Ventures and DSW, as the case may be, shall in all cases remain
primarily responsible for all obligations undertaken by it in this Agreement with respect to the
scope, quality and nature of the Services provided to the other Party and, provided further, that,
in each case, the use of a subcontractor to perform

18

 

such Party’s obligations would not
substantially increase the costs to the other Party without the prior written consent of the other
Party.

     SECTION 9.06. Force Majeure.

     (a) For purposes of this Section 9.06, “Force Majeure” means an event beyond the control of
either Party, which by its nature could not have been foreseen by such Party, or, if it could have
been foreseen, was unavoidable, and includes without limitation, acts of God, storms, floods,
riots, fires, sabotage, civil commotion or civil unrest, interference by civil or military
authorities, acts of war (declared or undeclared) and failure of energy sources.

     (b) Without limiting the generality of Section 4.03, neither Party shall be under any
liability for failure to fulfill any obligation under this Agreement, so long as and to the extent
to which the fulfillment of such obligation is prevented, frustrated, hindered, or delayed as a
consequence of circumstances of Force Majeure; provided that such Party shall have exercised all
commercially reasonable due diligence to minimize to the greatest extent possible the effect of
Force Majeure on its obligations hereunder.

     (c) Promptly on becoming aware of Force Majeure causing a delay in performance or preventing
performance of any obligations imposed by this Agreement (and termination of such delay), the Party
affected shall give written notice to the other Party giving details of the same, including
particulars of the actual and, if applicable, estimated continuing effects of such Force Majeure on
the obligations of the Party whose performance is prevented or delayed. If such notice shall have
been duly given, and actual delay resulting from such Force Majeure shall be deemed not to be a
breach of this Agreement, the period for performance of the obligation to which it relates shall be
extended accordingly; provided that if Force Majeure results in the performance of a Party being
delayed by more than 60 days, the other Party shall have the right to terminate this Agreement with
respect to any Service affected by such delay forthwith by written notice.

     SECTION 9.07. Entire Agreement. This Agreement (including the Schedules constituting a part of this Agreement) and any
other writing signed by the Parties that specifically references or is specifically related to this
Agreement constitute the entire agreement among the Parties with respect to the subject matter
hereof and supersede all prior agreements, understandings and negotiations, both written and oral,
between the Parties with respect to the subject matter hereof. This Agreement is not intended to
confer upon any Person other than the Parties hereto any rights or remedies hereunder.

     SECTION 9.08. Information. Subject to applicable law and privileges, each Party hereto
covenants with and agrees to provide to the other Party all information regarding itself and
transactions under this Agreement that the other Party reasonably believes is required to comply
with all applicable federal, state, county and local laws, ordinances, regulations and codes,
including, but not limited to, securities laws and regulations.

     SECTION 9.09. Notices. Any notice, instruction, direction or demand under the terms of this
Agreement required to be in writing shall be duly given upon delivery, if delivered by hand,
facsimile transmission, or mail (with postage prepaid), to the following addresses:

	 	(a)	 	If to DSW, to:
	 
	 	 	 	Peter Horvath

DSW Inc.

4150 East 5th Avenue

Columbus, OH 43219

Fax: (614) 872-1464

19

 

	 	 	 	With a copy to:
	 
	 	 	 	DSW Inc.

Attn: General Counsel

	 	 	 	4150 East 5th Avenue

Columbus, Ohio 43219

Fax: (614) 872-1464
	 
	 	(b)	 	If to Retail Ventures, to:
	 	 	 	Jim McGrady

Retail Ventures, Inc.

3241 Westerville Road

Columbus, OH 43224

Fax: 614-473-2721
	 
	 	 	 	With a copy to:
	 
	 	 	 	Retail Ventures, Inc.

Attn: General Counsel

3241 Westerville Road

Columbus, Ohio 43224

Fax: 614-337-4682

or to such other addresses or telecopy numbers as may be specified by like notice to the other
Party.

     SECTION 9.10. Governing Law. This Agreement shall be construed in accordance with and
governed by the substantive internal laws of the State of Ohio, excluding its conflict of laws
rules.

     SECTION 9.11. Severability. If any terms or other provision of this Agreement or the
Schedules or exhibits hereto shall be determined by a court, administrative agency or arbitrator to
be invalid, illegal or unenforceable, such invalidity or unenforceability shall not render the
entire Agreement invalid. Rather, this Agreement shall be construed as if not containing the
particular invalid, illegal or unenforceable provision, and all other provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially adverse to either
Party. Upon such determination that any term or other provision is invalid, illegal or
unenforceable, the Parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the Parties as closely as possible in an acceptable manner to the end that
the transactions contemplated hereby are fulfilled to the fullest extent permitted under applicable
law.

     SECTION 9.12. Amendment. This Agreement may only be amended by a written agreement executed
by both Parties hereto.

     SECTION 9.13. Counterparts. This Agreement may be executed in separate counterparts, each of
which shall be deemed an original and all of which, when taken together, shall constitute one and
the same agreement.

     SECTION 9.14. Authority. Each of the Parties represent to the other Party that (a) it has
the corporate or other requisite power and authority to execute, deliver and perform this
Agreement, (b) the execution, delivery and performance of this Agreement by it have been duly
authorized by all necessary corporate or other actions, (c) it has duly and validly executed and
delivered this Agreement, and (d) this Agreement is its legal, valid and binding obligation,
enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors’ rights generally and general
equity principles.

20

 

     IN WITNESS WHEREOF, the Parties have caused this Agreement to be signed by their duly
authorized representatives.

	 	 	 	 	 
	 	DSW INC.

 	 
	 	By:  	/s/Peter Z. Horvath
 	 
	 	Name: Peter Z. Horvath  	 
	 	Title: President  	 
	 
	 	RETAIL VENTURES, INC.

 	 
	 	By:  	/s/ James A. McGrady
 	 
	 	Name: James A. McGrady  	 
	 	Title: Chief Financial Officer  	 
	 

21

 

SCHEDULE I

TO

AMENDED AND RESTATED

SHARED SERVICES AGREEMENT

DATED October 29, 2006

BETWEEN

RETAIL VENTURES, INC.

AND

DSW INC.

 

SERVICES TO BE PROVIDED BY RETAIL VENTURES, INC. AND RETAIL VENTURES

SERVICES, INC.

	 	 	 	 	 
	DESCRIPTION OF RETAIL VENTURES
SERVICE	 	RETAIL VENTURES SERVICE COSTS OR
BILLING METHODOLOGY TO DSW
	 
	 	 	 	 
	1.

	 	GENERAL CORPORATE AND FINANCIAL
SERVICES:	 	 
	 
	 	 	 	 
	 

	 	(i) PAYROLL SERVICES (including
preparation and distribution of
employee checks; payment of
payroll taxes, garnishment and
other deductions to appropriate
parties; preparation and filing of
employer tax returns; and
preparation of annual W-2s for
employees)
	 	Billing pro-rata based upon number
of DSW employee checks and Form
W-2s issued by Retail Ventures.
To be billed weekly in arrears.
	 
	 	 	 	 
	 

	 	(ii) TREASURY SERVICES (including
cash management; processing and
paying invoices and purchase
orders; monthly consolidation of
financial statements; and
preparation of checks for
vendor payment and employee
reimbursement)
	 	DSW to pay $1,000.00 per month and
any stand-alone cash management
software and corresponding support
costs if added for DSW Services
only.
	 
	 	 	 	 
	 

	 	(iii) Sox and AUDITING Fees
(including coordination of
external audit services and
assistance with compliance with
Sarbanes-Oxley requirements)
	 	Shared costs to be allocable based
on Percent of Sales Billing.
	 
	 	 	 	 
	 

	 	(iv) ACCOUNTS PAYABLE, GENERAL
LEDGER, SALES AUDIT, BUDGET
SERVICES- AND INVENTORY
CONTROL. GENERAL LEDGER INCLUDES,
BUT IS NOT LIMITED TO, PREPARATION
OF QUARTERLY,
	 	Overhead costs to be allocated
based on time spent by associates,
which will be reviewed and
determined annually.
	 
	 	 	 	 
	 

	 	 	 	Sales Audit charges to include fees
	 
	 	 	 	 
	 

	 	ANNUAL AND OTHER SEC REPORTS;
ASSISTANCE WITH THE PREPARATION OF
ANNUAL REPORT TO SHAREHOLDERS AND
EARNINGS RELEASES; AND PREPARATION
OF ERISA REPORTS.
	 	associated with software
agreements that support DSW
Entities.

1

 

	 	 	 	 	 
	DESCRIPTION OF RETAIL VENTURES
SERVICE	 	RETAIL VENTURES SERVICE COSTS OR
BILLING METHODOLOGY TO DSW
	 
	 	 	 	 
	 

	 	(v) TAX SERVICES (including
preparation and filing of all
federal, state and local tax
returns, reports and
other required filings;
coordination and management of tax
audits and other similar
proceedings; and
assistance with tax planning,
tax strategy and compliance
with the Tax Separation Agreement)
	 	See Tax Separation Agreement
between DSW and Retail Ventures.
	 
	 	 	 	 
	 

	 	(vi) Controller Services
	 	Cost to be shared by DSW and
Retail Ventures on a 50/50 basis.
	 
	 	 	 	 
	 

	 	(vii) SSC Corporate Services
	 	Charges incurred on behalf of DSW
entities will be allocated to DSW.
Charges billed to other cost
centers listed in these Agreement
Schedules will be billed under the
applicable cost center’s
methodology. General, unallocable
charges to be allocated based on
Percent of Sales billing.
	 
	 	 	 	 
	2.

	 	HUMAN RESOURCES (ALL COST CENTERS)
	 	Pass-Through Billing with respect
to costs directly related to DSW
Entities.
	 
	 	 	 	 
	 

	 	 	 	DSW to pay pro-rata share of
overhead costs per employee of DSW
Entities, subject to adjustment
semi-annually.
	 
	 	 	 	 
	3.

	 	IMPORT MANAGEMENT AND COMPLIANCE
	 	Pass-Through Billing with respect
to costs directly related to DSW
Entities. Importing fees
(including U.S. Customs fees,
Duties, Commissions, Ocean
Freight, Excel/APL Logistic
Carrier fees and other associated
expense) are allocated to the
businesses by invoice (which
historically is a one-to-one
relationship to container) to the
ratio of the container contents to
the whole containers/trailer.
	 
	 	 	 	 
	 

	 	 	 	DSW to pay a percentage of the
overhead costs based upon
percentage of usage. The overhead
allocation percentage will be
reviewed and determined annually.

2

 

	 	 	 
	DESCRIPTION OF RETAIL VENTURES
SERVICE

	 	RETAIL VENTURES SERVICE COSTS OR
BILLING METHODOLOGY TO DSW
	 
	 	 
	4. LEGAL SERVICES (including general legal
advice from in-house legal staff;
preparation and review of SEC filings and
proxy materials; assistance with corporate
resolutions and preparations for
shareholders meetings; overseeing and
managing legal policy and strategy
regarding litigation and regulatory
compliance)

	 	Pass-Through Billing with respect
to costs directly related to DSW
Entities.

Department overhead costs and
general, unallocable professional
fees to be allocated based on
Percent of Sales Billing.
	 
	 	 
	5. RISK MANAGEMENT (including management of
insurance and workers compensation
coverage; administration of claims
services; negotiation and acquisition of
insurance coverages including, but not
limited to, property and business
interruption, casualty (including workers
compensation), director and officer
liability and other liability coverages)

	 	a) Insurance premium costs billed
as specified in Schedule III.

b) Overhead costs are billed on
the weighted value of
administrative time directed to
DSW entities for (i) Workers’
Compensation, (ii) General
Liability and (iii) Property & All
Other Lines combined with the
ratio of the number of claims that
are directly related to DSW
Entities to the total number of
claims for (i) Workers’
Compensation, (ii) General
Liability and (iii) Property & All
Other Lines.
	 
	 	 
	6. INTERNAL AUDIT

	 	Overhead costs to be allocated
based on Percent of Sales Billing.
	 
	 	 
	7. RVI CORPORATE EXECUTIVE OVERHEAD
ALLOWANCE

	 	DSW will pay 35% of the total
overhead of this cost center that
is associated with the CFO of RVI.
It will exclude the costs
associated with the CEO of RVI.
	 
	 	 
	8. DISTRIBUTION SERVICES

	 	DSW will pay 10% of total overhead
costs for this department.
	 
	 	 
	9. LETTERS OF CREDIT ASSOCIATED WITH
WORKERS’ COMPENSATION AND IBNR

	 	DSW to be billed 15% of costs
associated with letters of credit
for workers compensation and IBNR.
	 
	 	 
	10.
DEPRECIATION OF IT ASSETS (CURRENT COST CENTERS including 01109,
01321, 01325, 01326, 01328, 01329, 01330, 01331, 01332, 01333)

	 	Service fee charged to DSW for
depreciation expenses associated with IT Assets used to provide
shared service. The billable charge for depreciation expenses is
based on Percent of Sales Billing, unless otherwise agreed by the
Parties or determined by the Information Technology Executive
Steering Committee.

3

 

SCHEDULE II

TO

AMENDED AND RESTATED

SHARED SERVICES AGREEMENT

DATED October 29, 2006

BETWEEN

RETAIL VENTURES, INC.

AND

DSW INC.

SERVICES TO BE PROVIDED BY DSW INC.

	 	 	 	 	 
	DESCRIPTION OF DSW SERVICE	 	DSW SERVICE COSTS OR BILLING METHODOLOGY
TO RETAIL VENTURES
	 
	 	 	 	 
	1.

	 	SHOE MERCHANDISING:	 	 
	 
	 	 	 	 
	 

	 	(i) PLANNING AND
ALLOCATION SUPPORT for
Value City Department
Stores, LLC
	 	Value City to pay the amount per month
reflecting the agreed value of the use of
DSW systems services.
	 
	 	 	 	 
	2.

	 	DISTRIBUTION	 	 
	 
	 	 	 	 
	 

	 	(i) DISTRIBUTION
SERVICES AND
TRANSPORTATION
MANAGEMENT for Value
City Department Stores,
LLC and Filene’s
Basement
	 	(i) Retroactive to October 1, 2006, Value
City to pay 60¢ per pair to process shoes
during the term of the Agreement, with no
extra charge for overhead variances or any
other cost associated with processing
Value City’s shoes. In the event that the
“Reasonable Expectation Program” installed
at DSW, or any other cost reduction
realized by DSW, results in an actual cost
to process Value City shoes that is less
than 60¢ per pair, the cost per pair to
process shoes for Value City shall be
reduced based on quarterly actual cost.
The per-pair cost set forth herein shall
remain in effect through January 30, 2011
or any earlier date on which Retail
Ventures or DSW terminates shoe processing
services for Value City in accordance with
the Agreement.

(ii) Transportation Costs- both inbound
and outbound transportation costs
(inclusive of wages, associated payroll
costs, occupancy expenses and operating
expenses) are allocated to the respective
businesses according to current month
activity, which is based on merchandise
receipts as determined by dollar value.
Value City may use its own carriers for
inbound transportation. In the event that
Value City uses its own carriers for
inbound transportation, such merchandise
receipts shall be excluded from the
allocation of expenses and

1

 

	 	 	 	 	 
	DESCRIPTION OF DSW SERVICE	 	DSW SERVICE COSTS OR BILLING METHODOLOGY
TO RETAIL VENTURES
	 
	 	 	 	 
	 

	 	 	 	DSW shall have
no responsibility or accountability for
the merchandise until it is received at
the DSW distribution center.
	 
	 	 	 	 
	 

	 	 	 	(iii) Professional fees to be billed on
the weighted average cost per case of the
pools that Value City Shoes utilizes.
	 
	 	 	 	 
	3.

	 	PROPERTY MANAGEMENT
	 	Overhead costs to be allocated based
on time spent by associates, which will be
reviewed and determined annually.
Related outside contractors/consultant
costs, including legal services,
allocated based on pass-through
billing.
	 
	 	 	 	 
	4.

	 	STORE DESIGN AND
CONSTRUCTION MANAGEMENT
	 	A 5% service fee based on total
development costs per project, plus
expenses incurred by DSW on RVI
projects. Overhead costs allocated on
the proportion of RVI projects to total
projects (extraordinary projects to be
determined on a project by project
basis). Standard American Institute of
Architects (AIA) form of “Agreement
between Owner and Design/Builder” to be
used as design and construction
management agreement between DSW and
Retail Ventures.
	 
	 	 	 	 
	5.

	 	INFORMATION TECHNOLOGY
(ALL COST CENTERS)
	 	Pass-Through Billing with respect to costs
directly related to Retail Ventures
Entities. Percent of Sales Billing with
respect to overhead and Services shared by
DSW Entities and Retail Ventures Entities,
unless otherwise agreed by the Parties or
determined by the Information Technology
Executive Steering Committee.
	 
	 	 	 	 
	6.

	 	DEPRECIATION OF IT ASSETS	 	Service fee charged to Retail Ventures for
depreciation expenses associated with IT
Assets used to provide shared service.
The billable charge for depreciation
expenses is based on Percent of Sales
Billing, unless otherwise agreed by the
Parties or determined by the Information
Technology Executive Steering Committee.

2

 

	 	 	 	 	 
	DESCRIPTION OF DSW SERVICE	 	DSW SERVICE COSTS OR BILLING METHODOLOGY
TO RETAIL VENTURES
	 
	 	 	 	 
	7.

	 	Legal Services
	 	Pass-Through Billing with respect to costs
directly related to RVI Entities.
	 
	 	 	 	 
	 

	 	 	 	Professional fees related to shared
services provided by DSW to be allocated
based upon Percent of Sales Billing unless
otherwise agreed.
	 
	 	 	 	 
	 

	 	 	 	Any overhead costs for time spent on
matters performed on behalf of RVI
Entities shall be at an agreed upon price.

3

 

SCHEDULE III

TO

AMENDED AND RESTATED

SHARED SERVICES AGREEMENT

DATED October 29, 2006

BETWEEN

RETAIL VENTURES, INC.

AND

DSW INC.

 

INSURANCE POLICIES MAINTAINED BY RETAIL VENTURES

     The Insurance Polices described in Part (a) below shall be maintained by
Retail Ventures, Inc. (“Retail Ventures”) on behalf of DSW Inc. (“DSW”) and its Subsidiaries
pursuant to the terms of the Amended and Restated Shared Services Agreement between Retail Ventures
and DSW dated October 29, 2006, of which this Schedule is a part. The insurance premiums related
to such policies to be paid by DSW, or for which Retail Ventures shall be reimbursed by DSW, are
set forth or described in Part (b) of this Schedule. Capitalized terms not otherwise defined in
this Schedule shall have the respective meanings assigned to them in the Amended and Restated
Shared Services Agreement.

	(a)	 	LIST OF INSURANCE POLICIES

	 	(i)	 	Liability:

Steadfast Insurance Co. #SCO3822186-02 – primary – $1MM/occurrence

XL Insurance Co. #US00007102LI04A – umbrella — $25MM/occ/agg

Ohio Casualty Co. #ECO(05)52976611, excess GL – $25MM/occ/agg

American Guarantee # AEC5086837500 – excess GL – $50MM/occ/agg

Liberty Mutual Ins. #LQ1-B71 –078764032 – excess GL – $50MM/occ/agg

ACE Ins. Group #HXW776336 — excess GL – $25MM/occ/agg

Great American Ins. #TUE357977102 – excess GL – $25MM/occ/agg
	 
	 	(ii)	 	Property

FM Global Insurance #NB918 — $1,000,000,000 blanket limit

Ace/Westchester #I20651258002 – excess flood – $10MM

Great American #CPP5385581 & #ACG4285581 – excess flood – $5MM

Arrowhead Group #303219EQ1 – excess earthquake – $3MM

North Shore Mgmt. #NSM24310 – excess earthquake – $12MM

FM Global #NB918 – Swanson primary earthquake – $1MM

Federal Flood Policies – various locations & policy numbers — $500K

1

 

	 	(iii)	 	Automobile

St. Paul Travelers #TC2JCAP393K338 – $2MM combined single limit
	 
	 	(iv)	 	Cargo

Lloyd’s #CD044747 – primary cargo – $10MM/conveyance

Lloyd’s #CD044765 – excess cargo – $5MM/conveyance
	 
	 	(v)	 	Worker Compensation

St. Paul Travelers #TC2JUB466K1644 – statutory limits

St. Paul Travelers #TRJUB466K1656 – retro AZ, MA & WI only

Ohio –Self-insured under S120005342

West Virginia – Self-insured (effective no later than 1/1/07)
	 
	 	(vi)	 	Director and Officer Liability Insurance

Chubb #6802-9501 – primary — $10MM

XL Specialty #ELU09312106___– excess D&O – $10MM

AWAC US #___AW6294743 – excess D&O – $10MM

RSUI #___NHS621943 – excess D&O – $10MM

AXIS #___RAN714919012006 – excess D&O – $10MM

Arch Insurance Co. #___DOX0007876-01 – excess D&O – $10MM

Houston Casualty #___14_MGU-06-A12538 – excess D&O – $10MM

Great American #___NSX5236478 – excess D&O – $10MM

Liberty Mutual #___D03AT366109002 – excess D&O – $10MM

National Union (AIG) #___6726927 – excess D&O – $10MM

XL Specialty #___ELU09312206 – Side A coverage – $10MM
	 
	 	(vii)	 	Executive Protection Insurance

National Union (AIG) #006082944 – crime – $10MM

National Union (AIG) #647-5648 – special crime (K&R) – $10MM
	 
	 	(viii)	 	Other

Fireman’s Fund #MXI97900076 – motor truck cargo – $250K/vehicle

XL Insurance #XLPUN1502904 – excess punitives – $25MM agg

Magna Carta #MCPD201467 – excess punitives – $25MM agg

National Union #006731374 – fiduciary

Continental Insurance Company #PST283529925 – foreign package — $1MM/occ

	(b)	 	CALCULATION OF PREMIUM
	 
	 	 	(i) DSW shall promptly pay or reimburse Retail Ventures 100% of premium expenses,
deductibles or retention amounts Retail Ventures may incur in connection with Insurance
Policies that relate solely to the DSW Business.

2

 

(ii) DSW shall promptly pay or reimburse Retail Ventures 50% of premium expenses,
deductibles or retention amounts Retail Ventures may incur in connection with Retail
Ventures’ Director and Officer Liability Insurance and Executive Protection Insurance.

(iii) DSW shall promptly pay or reimburse Retail Ventures its proportionate share of premium
expenses, deductibles or retention amounts Retail Ventures may incur in connection with
Insurance Policies that relate the Retail Ventures Business and the DSW Business. The
“Retail Ventures Business” means any business of Retail Ventures other than the DSW
Business. DSW’s proportionate will be calculated as follows:

     (A) LIABILITY INSURANCE costs shall be prorated based on the ratio of DSW’s sales as
compared to total sales.

     (B) PROPERTY INSURANCE costs shall be prorated based on the ratio of the value of DSW
property covered by the insurance policy as compared to the total value of all property
covered by the insurance policy. [“VALUE OF PROPERTY” IS DEFINED AS RETAIL INVENTORY,
FIXTURES, LEASEHOLDS, REAL PROPERTY, RENTAL INCOME AND BUSINESS INTERRUPTION.]

     (C) AUTOMOBILE INSURANCE costs shall be charged on each insured vehicle owned or leased
by DSW which is covered by the insurance policy.

     (D) CARGO INSURANCE costs shall be prorated based on the ratio of the duties paid for
DSW imports covered by the insurance policy as compared to the total duties paid for all
imports covered by the insurance policy.

     (E) WORKERS COMPENSATION costs shall be prorated based on an actual per state rate
against projected payrolls plus estimated claims cost per location.

     (F) EXECUTIVE PROTECTION AND OTHERS—Executive Protection Insurance (or crime), and
foreign package coverage shall be prorated based on the ratio of sales for DSW as compared
to the total sales covered by the policy. Fiduciary coverage for benefit plans shall be
allocated based on 401K deposit percentages. Federal Flood Program policies are allocated
to each location for which a policy is required to be purchased based on its Federal Flood
Zone determination.

3

 

SCHEDULE IV

TO

AMENDED AND RESTATED

SHARED SERVICES AGREEMENT

DATED October 29, 2006

BETWEEN

RETAIL VENTURES, INC.

AND

DSW INC.

 

GUARANTEE

THIS GUARANTEE is made by RETAIL VENTURES, INC. (the “Guarantor”) in favor of DSW, INC. (“DSW”) in
respect of the obligations of any one or more of the subsidiaries of the Guarantor other than DSW
or any DSW subsidiary (the “Obligor(s)”) that may arise under that certain Amended and Restated
Shared Services Agreement between the Guarantor and DSW, dated as of October 29, 2006 (the “Shared
Services Agreement”) to pay to DSW certain amounts that may become due under and in accordance
with Section 7.05 of the Shared Services Agreement (each, an “Obligation”).

In consideration of DSW acquiring certain information technology assets (equipment, computer
software, etc.) for the benefit of one or more Obligors, the receipt and sufficiency of which are
hereby acknowledged by the Guarantor, the Guarantor hereby agrees as follows:

	 	1)	 	To the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable discharge or
defense of a surety or guarantor, the Guarantor hereby absolutely, irrevocably and
unconditionally guarantees to DSW and its assignees the timely payment to DSW or its
assignees of all Obligations. Without limiting the generality of the foregoing, DSW may
at any time and from time to time, without notice to or consent of the Guarantor and
without impairing or releasing the obligations of the Guarantor, (a) agree with any
Obligor to make any change in the terms of any obligation or liability of such Obligor to
DSW, (b) take or fail to take any action of any kind in respect of any security for any
obligation or liability of any Obligor to DSW, (c) exercise or refrain from exercising any
rights against any Obligor, or (d) compromise or subordinate any obligation or liability
of any Obligor to DSW, including any security therefor.
	 
	 	2)	 	In the event that an Obligor shall fail to make timely payment to DSW of all or any
portion of an Obligation when due, the Guarantor shall remit to DSW, on the business day
immediately following DSW’s request, payment of the full amount of such Obligation. The
Guarantor hereby expressly waives diligence, presentment, demand of payment, protest and
all notices whatsoever, and any requirement for DSW to pursue or exhaust any of its rights
or remedies against the Obligor with respect to performance of any of the Obligations, and
the Guarantor hereby waives any right to require that DSW seek enforcement of any
performance against an Obligor or any other person, prior to any action against the
Guarantor under the terms of this Guarantee.
	 
	 	3)	 	DSW shall not be obligated to file any claim relating to an Obligation in the event
that an Obligor becomes subject to any insolvency, bankruptcy, receivership, assignment
for the benefit of creditors or reorganization of such Obligor, or any similar proceedings
by or against such Obligor or the assets of such Obligor, in order to maintain DSW’s
rights under this Guarantee, and the failure of DSW to so file shall not affect the
Guarantor’s obligations hereunder. The liability of the Guarantor shall not be released,
reduced, impaired or affected by or as a result of any insolvency, bankruptcy,
receivership, assignment for the benefit of creditors or reorganization of an Obligor, or
any similar proceedings instituted by or against an Obligor or the assets of an Obligor.
The obligations of the Guarantor hereunder shall be automatically reinstated if and to the
extent that for any reason any payment by or on behalf of any Obligor in respect of an
Obligation is rescinded or must be otherwise restored by DSW, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise, and the Guarantor agrees that it
will indemnify DSW on demand for all reasonable costs and expenses (including, without
limitation, fees and expenses of counsel) incurred by DSW in connection with such
rescission or restoration, including any such costs and expenses

4

 

	 	 	 	incurred in defending against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any bankruptcy, insolvency or
similar law.
	 
	 	4)	 	This Guarantee is a guarantee of payment and not of collection, is a continuing
guarantee, and shall apply to all Obligations whenever arising.
	 
	 	5)	 	This Guarantee shall remain in effect for the entire term of the Shared Services
Agreement and thereafter until all Obligations of each Obligor have been indefeasibly
satisfied in full.
	 
	 	6)	 	This Guarantee shall inure to the benefit of and be enforceable by DSW and its
successors, assign(s) or other transferee(s) and shall be deemed to have been made under,
and shall be governed by, the laws of the State of Ohio, excluding its conflicts of laws
rules. None of the terms of this Guarantee may be waived, altered, modified or amended
except in writing signed by the Guarantor and DSW.
	 
	 	7)	 	All notices or other communications to the Guarantor or DSW shall be in writing and
shall be given in the same manner and with the same effect as set forth in Section 9.09 of
the Shared Services Agreement. The address of Guarantor is as follows:
	 
	 	 	 	Retail Ventures, Inc.
3241 Westerville Road
Columbus, Ohio 43224

IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be duly executed and delivered by
its duly authorized officers effective as of the 29th day of October, 2006.

	 	 	 	 	 
	 	 	RETAIL VENTURES, INC.
	 
	 	 	 	 
	 

	 	By:	 	/s/ James A. McGrady
	 

	 	 	 	 
	 

	 	Name:

Title:
	 	James A. McGrady

Chief Financial Officer

5

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00114-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00114-of-00352.parquet"}]]