Document:

Form of Executive Severance Agreement

 EXHBIT 10.26 
 EXECUTIVE SEVERANCE AGREEMENT 
 By this Executive Severance Agreement dated
and effective as of                     , 20     (“Agreement”), Sears Holdings Corporation and its affiliates and
subsidiaries (“Sears”), and [                    ] (“Executive”), intending to be legally bound, and for good and valuable
consideration, agree as follows: 
 1. Effect of Severance. 

(a) Severance Benefits. If Executive is involuntarily terminated without “Cause” or Executive voluntarily
terminates Executive’s employment for “Good Reason” (as such terms are defined in Section 2 below), Executive shall be entitled to the benefits described in subsection (i), (ii) and (iii) below (collectively referred to
herein as “Severance Benefits”). Executive shall not be entitled to the Severance Benefits if Executive’s employment terminates for any other reason, including due to death or “Disability” (as defined in Section 2
below). Executive shall also not be entitled to Severance Benefits if Executive does not meet all of the other requirements under this Agreement, including under subsection 4(g). 

i. Continuation of Salary. 

1. Sears or the appropriate “Sears Affiliate” (as defined in Section 2 below) shall pay Executive cash
severance equal to Executive’s annual base salary rate as of the date Executive’s employment terminates (“Date of Termination”). Subject to subsection (a)(i)(2) below, payment of such amount (“Salary Continuation”)
shall commence on Executive’s “Separation from Service” (as defined in Section 2 below) and shall be paid in substantially equal installments on each regular salary payroll date for a period of twelve (12) months following
Date of Termination (“Salary Continuation Period”), except as otherwise provided in this Agreement. 

Notwithstanding the foregoing, the Sears or Sears Affiliate obligations under this subsection (a)(i)(1) shall be reduced
on a dollar-for-dollar basis (but not below zero), by the amount, if any, of fees, salary or wages that Executive earns from a subsequent employer (including those arising from self-employment) during the Salary Continuation Period. For avoidance of
doubt, Executive shall not be obligated to seek affirmatively or accept an employment, contractor, consulting or other arrangement in order to mitigate Salary Continuation. Further, to the extent Executive does not execute and timely submit the
General Release and Waiver (in accordance with subsection 4(g) below) by the deadline specified therein, Salary Continuation payments shall terminate and forever lapse, and Executive shall be required to reimburse Sears for any portion of the Salary
Continuation paid during the Salary Continuation Period. 

 2. Notwithstanding anything in this subsection (a)(i) to the contrary, if
the Salary Continuation payable to Executive in accordance with subsection (a)(i)(1) above during the first six (6) months after Executive’s Separation from Service would exceed the “Section 409A Threshold” and if as of the date
of the Separation from Service Executive is a “Specified Employee” (as such terms are defined in Section 2 below), then, payment shall be made to Executive on each regular salary payroll date during the first six (6) months of
the Salary Continuation Period until the aggregate amount received equals the Section 409A Threshold. Any portion of the Salary Continuation in excess of the Section 409A Threshold that would otherwise be paid during such first six
(6) months or any portion of the Salary Continuation that is otherwise subject to Section 409A, shall instead be paid to Executive in a lump sum payment on the date that is six (6) months and one (1) day after the date of
Executive’s Separation from Service. 
 3. All Salary Continuation payments (described under this
subsection (a)(i)) will terminate and forever lapse if Executive is employed by a “Sears Competitor” or “Sears Vendor” (as such terms are defined in subsection 4(c)(ii) and 4(d)(ii) herein, respectively) during the Salary
Continuation Period or in the event of Executive’s breach (in accordance with Section 10 below), and Executive shall be required to reimburse Sears for any portion of the Salary Continuation paid during the Salary Continuation Period.

 ii. Continuation of Benefits. 

1. During the Salary Continuation Period, Executive will be entitled to participate in all benefit
plans and programs (except as specified in this subsection (a)(ii)), as an active associate, in which Executive was eligible to participate on the Date of Termination (subject to the terms and conditions and continued availability of such plans and
programs); provided, however, that Executive will not be eligible to participate in the long-term disability plan (as of the 15th day following the Date of Termination), health care flexible spending account (except on an after-tax basis and only
through the earlier of the end of Salary Continuation Period or the calendar year in which the Separation from Service occurs), Sears paid life insurance and the Sears Holdings 401(k) Savings Plan (or any other defined contribution plan sponsored by
Sears or a Sears Affiliate) during the Salary Continuation Period. Executive and Executive’s eligible dependents shall be entitled to continue to participate, as active participants, in Sears medical and dental plans (subject to the terms and
conditions and continued availability of such plans) during the Salary Continuation Period. 
 2. If Executive
does not timely execute and submit the General Release and Waiver (in accordance with subsection 4(g) herein) by the deadline specified therein, Executive shall be required to reimburse Sears for the portion of the cost for the benefits referred to

  

					
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under subsection (a)(ii)(1) immediately above paid by Sears during the Salary Continuation Period, and Executive shall instead be eligible for COBRA continuation coverage under the Sears medical
and dental plans as of Executive’s Date of Termination. 
 3. Subject to subsection (a)(ii)(4) immediately
below, in the event Executive provides services to another employer and is covered by such employer’s health benefits plan or program, the medical and dental benefits provided by Sears hereunder shall be secondary to such employer’s health
benefits plan or program in accordance with the terms of the Sears health benefit plans. 
 4. All of the
benefits described in this subsection (a)(ii) will terminate and forever lapse if Executive is employed by a Sears Competitor or Sears Vendor during the Salary Continuation Period or in the event of Executive’s breach (in accordance with
Section 10 below), and Executive shall be required to reimburse Sears for any portion of the cost for the benefits referred to under subsection (a)(ii)(1) immediately above paid by Sears during the Salary Continuation Period, and Executive
shall instead be eligible for COBRA continuation coverage under the Sears medical and dental plans as of Executive’s Severance from Service date. 
 iii. Outplacement. As of Executive’s Separation from Service, Executive will be immediately eligible for reasonable outplacement services at the expense of Sears or the appropriate Sears
Affiliate. Sears and Executive will mutually agree on which outplacement firm, among current vendors used by Sears, will provide these services. Such services will be provided for up to twelve (12) months from the Separation from Service or
until employment is obtained, whichever occurs first. Outplacement benefits described in this subsection (a)(iii) will terminate and forever lapse if Executive is employed by a Sears Competitor or Sears Vendor or in the event of Executive’s
breach (in accordance with Section 10 below). 
 iv. Other. 

1. In addition to the foregoing Severance Benefits, a lump sum payment will be made to Executive within ten
(10) business days following the Date of Termination in an amount equal to the sum of any base salary and any vacation benefits that have accrued through the Date of Termination to the extent not already paid. No vacation will accrue during the
Salary Continuation Period. 
 2. Notwithstanding the foregoing and anything herein to the contrary, in the
event of Executive’s death during the Salary Continuation Period, any unpaid portion of the Salary Continuation payable in accordance with subsection (a)(i) above shall be paid in a lump sum, within sixty (60) days of death (and no later
than amounts would have been paid absent death), to Executive’s estate, and any eligible dependents who are covered dependents as of the date of death shall incur a qualifying event under COBRA as a result of such death. 

  

					
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 (b) Impact of Termination on Certain Other Plans/Programs.

 i. Annual Incentive Plan. Upon Executive’s Date of Termination, Executive’s entitlement to
any award under the applicable annual incentive plan (“AIP”) sponsored by Sears, shall be determined in accordance with the terms and conditions of the AIP document regarding termination of employment. 

ii. Long-Term Incentive Program(s). Upon Executive’s Date of Termination, Executive’s entitlement to any
award granted to Executive under a long-term incentive program (“LTIP”) sponsored by Sears, shall be determined in accordance with the terms and conditions of the award letter and the LTIP document regarding termination of employment.

 iii. Stock Plan. Upon Executive’s Date of Termination, Executive’s entitlement to any
unvested options, restricted stock or other equity award granted to Executive under a stock plan sponsored by Sears shall be determined in accordance with the terms and conditions of the applicable award agreement and the stock plan document
regarding termination of employment. 
 (c) Post-Termination Forfeiture of Severance Benefits. If Sears
determines after Executive’s Date of Termination that Executive engaged in activity during employment with Sears that Sears determines constituted Cause, Executive shall immediately cease to be eligible for Severance Benefits and shall be
required to reimburse Sears for any portion of the Salary Continuation paid to Executive and for the cost of other Severance Benefits received by Executive during the Salary Continuation Period. 

2. Definitions. For purposes of this Agreement, each capitalized term in this Agreement is either defined in the section, exhibit
or appendix in which it first appears or in this Section 2. The following capitalized terms shall have the definitions as set forth below: 
 (a) “Cause” shall mean (i) a material breach by Executive (other than a breach resulting from Executive’s incapacity due to a Disability) of Executive’s duties and
responsibilities which breach is demonstrably willful and deliberate on Executive’s part, is committed in bad faith or without reasonable belief that such breach is in the best interests of Sears or the Sears Affiliates and is not remedied in a
reasonable period of time after receipt of written notice from Sears specifying such breach; (ii) the commission by Executive of a felony; or (iii) dishonesty or willful misconduct in connection with Executive’s employment.

 (b) “Disability” shall mean disability as defined under the Sears long-term disability plan
(regardless of whether the Executive is a participant under such plan). 

  

					
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 (c) “Good Reason” shall mean, without
Executive’s written consent, (i) a reduction of more than ten percent (10%) in the sum of Executive’s annual base salary and target AIP bonus from those in effect as of the date of this Agreement; (ii) Executive’s
mandatory relocation to an office more than fifty (50) miles from the primary location at which Executive is required to perform Executive’s duties immediately prior to the date of this Agreement; or (iii) any other action or inaction
that constitutes a material breach of the terms of this Agreement, including failure of a successor company to assume or fulfill the obligations under this Agreement. In each case, Executive must provide Sears with written notice of the facts
giving rise to a claim that “Good Reason” exists for purposes of this Agreement, within thirty (30) days of the initial existence of such Good Reason event, and Sears shall have a right to remedy such event within sixty
(60) days after receipt of Executive’s written notice (“the sixty (60) day period”). If Sears remedies the Good Reason event within the sixty (60) day period, the Good Reason event (and
Executive’s right to receive any benefit under this Agreement on account of termination of employment for Good Reason) shall cease to exist. If Sears does not remedy the Good Reason event within the sixty (60) day period, and
Executive does not incur a termination of employment within thirty (30) days following the earlier of: (y) the date Sears notifies Executive that it does not intend to remedy the Good Reason or does not agree that there has been a
Good Reason event, or (z) the expiration of the sixty (60) day period, the Good Reason event (or any claim of Good Reason) shall cease to exist. Notwithstanding the foregoing, if Executive fails to provide written notice to Sears
of the facts giving rise to a claim of Good Reason within thirty (30) days of the initial existence of such Good Reason event, the Good Reason event (and Executive’s right to receive any benefit under this Agreement on
account of termination of employment for Good Reason) shall cease to exist as of the thirty-first
(31st) day following the later of its occurrence or
Executive’s knowledge thereof. 
 (d) “Sears Affiliate” shall mean any person with whom
Sears is considered to be a single employer under Code Section 414 (b) and all persons with whom Sears would be considered a single employer under Code Section 414 (c), substituting “50%” for the “80%” standard
that would otherwise apply. 
 (e) “Section 409A Threshold” shall mean an amount equal to two
times the lesser of (i) Executive’s base salary for services provided to Sears and any Sears Affiliate as an employee for the calendar year preceding the calendar year in which Executive has a Separation from Service; or (ii) the
maximum amount that may be taken into account under a qualified plan in accordance with Code Section 401(a)(17) for the calendar year in which the Executive has a Separation from Service. In all events, this amount shall be limited to the
amount specified under Treasury Regulation Section 1.409A-1(b)(9)(iii)(A) or any successor thereto. 
 (f)
“Separation from Service” shall mean a “separation from service” with Sears (including any Sears Affiliate) within the meaning of Code Section 409A (and regulations issued thereunder). Notwithstanding anything herein
to the contrary, the fact that Executive is treated as having incurred a Separation from Service under Code Section 409A and the terms of this Agreement shall not be determinative, or in any way affect the analysis, of whether Executive has
retired, terminated employment, separated from service, incurred a severance from employment or become entitled to a distribution, under the terms of any retirement plan (including pension plans and 401(k) savings plans) maintained by Sears
(including by a Sears Affiliate). 

  

					
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 (g) “Specified Employee” shall mean a “specified
employee” under Code Section 409A (and regulations issued thereunder), which shall be determined in accordance with the provisions of Supplement A to the Supplemental Retirement Income Plan (as amended and restated effective
January 1, 2008). 
 3. Intellectual Property Rights. Executive acknowledges that Executive’s development, work
or research on any and all inventions or expressions of ideas, that may or may not be eligible for patent, copyright, trademark or trade secret protection, hereafter made or conceived solely or jointly within the scope of employment at Sears or any
Sears Affiliate, provided such invention or expression of an idea relates to the business of Sears or any Sears Affiliate, or relates to actual or demonstrably anticipated research or development of Sears or any Sears Affiliate, or results from any
work performed by Executive for or on behalf of Sears or any Sears Affiliate, are hereby assigned to Sears, including Executive’s entire rights, title and interest. Executive will promptly disclose such invention or expression of an idea to
Executive’s management and will, upon request, promptly execute a specific written assignment of title to Sears. If Executive currently holds any inventions or expressions of an idea, regardless of whether they were published or filed with the
U.S. Patent and Trademark Office or the U.S. Copyright Office, or is under contract to not so assign, Executive will list them on the last page of this Agreement. 
 4. Protective Covenants. Executive acknowledges that this Agreement provides for additional consideration beyond what Sears or any Sears Affiliate is otherwise obligated to pay. In consideration of
the opportunity for the Severance Benefits, and other good and valuable consideration, Executive agrees to the following: 
 (a) Non-Disclosure of Sears Confidential Information. Executive acknowledges and agrees to be bound by the following, whether or not Executive receives any Severance Benefits under this Agreement:

 i. Non-Disclosure. 

1. Executive will not, during the term of Executive’s employment with Sears or any Sears Affiliate or thereafter,
and other than in the performance of his duties and obligations during his employment with Sears or as required by law or legal process, and except as Sears may otherwise consent or direct in writing, reveal or disclose, sell, use, lecture upon or
publish any “Sears Confidential Information” (as defined in subsection 4(a)(ii) below) until such time as the information becomes publicly known other than as a result of its disclosure, directly or indirectly, by Executive; and

 2. Executive understands that if Executive possesses any proprietary information of another person or company
as a result of prior employment or otherwise, Sears expects and requires that Executive will honor any and all legal obligations that Executive has to that person or company with respect to proprietary information, and Executive will refrain from
any unauthorized use or disclosure of such information. 

  

					
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 ii. Sears Confidential Information. For purposes of this Agreement,
“Sears Confidential Information” means trade secrets and non-public information which Sears or any Sears Affiliate designates as being confidential or which, under the circumstances, should be treated as confidential, including, without
limitation, any information received in confidence or developed by Sears or any Sears Affiliate, its long and short term goals, vendor and supply agreements, databases, methods, programs, techniques, business information, financial information,
marketing and business plans, proprietary software, personnel information and files, client information, pricing, and other information relating to the business of Sears or any Sears Affiliate that is not known generally to the public or in the
industry. 
 iii. Return of Sears Property. All documents and other property that relate to the business
of Sears or any Sears Affiliate are the exclusive property of Sears, even if Executive authored or created them. Executive agrees to return all such documents and tangible property to Sears upon termination of employment or at such earlier time as
Sears may request Executive to do so. 
 iv. Conflict of Interest. During Executive’s employment with
Sears or any Sears Affiliate and during any Salary Continuation Period, except as may be approved in writing by Sears, neither Executive nor members of Executive’s immediate family (which shall refer to Executive, any spouse or any child) will
have financial investments or other interests or relationships with Sears’ or any Sears Affiliate’s customers, suppliers or competitors which might impair Executive’s independence of judgment on behalf of the Company. Also during
Executive’s employment with Sears or any Sears Affiliate and during any Salary Continuation Period, Executive agrees further not to engage in any activity in competition with Sears or any Sears Affiliate and will avoid any outside activity that
could adversely affect the independence and objectivity of Executive’s judgment, interfere with the timely and effective performance of Executive’s duties and responsibilities to Sears or any Sears Affiliate, discredit Sears or any Sears
Affiliate or otherwise conflict with the best interests of Sears or any Sears Affiliate. 
 (b)
Non-Solicitation of Employees. During Executive’s employment with Sears or any Sears Affiliate and for twelve (12) months following Executive’s Date of Termination, whether or not Executive receives any Severance Benefits under
this Agreement, Executive will not, directly or indirectly, solicit or encourage any person to leave her/his employment with Sears or any Sears Affiliate or assist in any way with the hiring of any Sears or any Sears Affiliate employee by any future
employer or other entity. 
 (c) Non-Competition. Executive acknowledges that as a result of
Executive’s position at Sears or any Sears Affiliate, Executive has learned or developed, or will learn or develop, Sears Confidential Information and that use or disclosure of Sears Confidential Information is likely to occur if Executive were
to render advice or services to any Sears Competitor. 
 i. Therefore, for twelve (12) months following
Executive’s Date of Termination, whether or not Executive receives any Severance Benefits under this Agreement, Executive will not, directly or indirectly, aid, assist, participate in, consult with, render services for, accept a position with,
become employed by, or otherwise enter into any relationship with (other than having a passive ownership interest in or being a customer of) any Sears Competitor. 

  

					
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 ii. For purposes of this Agreement, “Sears Competitor” means:

 1. Those companies listed on Appendix A, each of which Executive acknowledges is a Sears Competitor,
whether or not it falls within the categories in subsection (ii)(2) immediately below, and further acknowledges that this is not an exclusive list of Sears Competitors and is not intended to limit the generality of subsection (ii)(2) immediately
below; and 
 2. Any party (A) engaged in any retail business (whether in a department store, specialty
store, discount store, direct marketing, or electronic commerce or other business format), that consists of selling furniture, appliances, electronics, hardware, lawn/garden, auto parts, food/consumables, toys, seasonal, fitness/sporting goods,
apparel and/or pharmacy products, or providing home improvement, product repair and/or home services, with combined annual revenue in excess of $1 billion, or (B) a party engaged in any other line of business, in which Sears (including any
Sears Affiliate) has commenced business prior to the end of Executive’s employment, having annual gross sales in that line of business in excess of $100 million. 

iii. Executive acknowledges that Sears shall have the right to propose modifications to Appendix A periodically to
include (1) emergent Competitors in Sears existing lines of business and (2) Competitors in lines of business that are new for Sears, in each case, with the prior written consent of Executive, which consent shall not be unreasonably
withheld. 
 iv. Executive further acknowledges that Sears (or Sears Affiliates) does business throughout the
United States, Puerto Rico, U.S. Virgin Islands, Guam and Canada and that this non-compete provision applies in any state or province (as applicable) of the United States, Puerto Rico, U.S. Virgin Islands, Guam and Canada, in which Sears does
business. 
 (d) Restriction on Post-Employment Affiliation with Sears Vendors. Executive acknowledges
that as a result of Executive’s position at Sears or any Sears Affiliate, Executive has learned or developed, or will learn or develop, Sears Confidential Information and that use or disclosure of Sears Confidential Information is likely to
occur if Executive were to render advice or services to any “Sears Vendor” (as defined herein). 
 i.
Therefore, for twelve (12) months from Executive’s Date of Termination, whether or not Executive receives any Severance Benefits under this Agreement, Executive will not, directly or indirectly, aid, assist, participate in, consult with,
render services for, accept a position with, become employed by, or otherwise enter into any relationship with (other than having a passive ownership interest in or being a customer of) any Sears Vendor. 

  

					
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 ii. For purposes of this Agreement, “Sears Vendor” means, the
vendors, if any, listed in Appendix A as well as any vendor with combined annual gross sales of services or merchandise to Sears in excess of $200 million. 

(e) Compliance with Protective Covenants. Executive will provide Sears with such information as Sears may from time
to time reasonably request to determine Executive’s compliance with this Section 4. Executive authorizes Sears to contact Executive’s future employers and other entities with which Executive has any business relationship to determine
Executive’s compliance with this Agreement or to communicate the contents of this Agreement to such employers and entities. Executive releases Sears, Sears Affiliates, their agents and employees, from all liability for any damage arising from
any such contacts or communications. 
 (f) Necessity and Reasonableness. Executive agrees that the
restrictions set forth herein are necessary to prevent the use and disclosure of Sears Confidential Information and to otherwise protect the legitimate business interests of Sears and Sears Affiliates. Executive further agrees and acknowledges that
the provisions of this Agreement are reasonable. 
 (g) General Release and Waiver. Upon Executive’s
Date of Termination (whether initiated by Sears or Executive in accordance with subsection 1(a) above) potentially entitling Executive to Severance Benefits, Executive will execute a binding general release and waiver of claims in a form to be
provided by Sears (“General Release and Waiver”), which is incorporated by reference under this Agreement. This General Release and Waiver will be in a form substantially similar to the attached sample. If the General Release and Waiver is
not signed within the time required by the waiver or is signed but subsequently revoked, Executive will not continue to receive any Severance Benefits otherwise payable under subsection 1(a) above. Further, Executive shall be obligated to reimburse
Sears for any portion of (i) the Salary Continuation paid during the Salary Continuation Period under subsection (1)(a)(i) herein, and (ii) the cost for the benefits provided during the Salary Continuation Period under subsection
(1)(a)(ii) herein. A sample of this General Release and Waiver is provided as Exhibit A to this Agreement. 
 (h) Exception Request. Notwithstanding the foregoing, Executive may request a waiver or a specific exception to the non-competition provisions of this Agreement by written request to the Senior
Vice President and President, Talent & Human Capital Services or Senior Vice President, General Counsel and Corporate Secretary (or the equivalent) of Sears. Such a request will be given reasonable consideration and may be granted, in whole
or in part, or denied at Sears’ absolute discretion. 
 5. Irreparable Harm. Executive acknowledges that irreparable
harm would result from any breach by Executive of the provisions of this Agreement, including without limitation subsections 4(a), 4(b), 4(c) and 4(d), and that monetary damages alone would not provide adequate relief for any such breach.
Accordingly, if Executive breaches or threatens to breach this Agreement, Executive consents to injunctive relief in favor of Sears without the necessity of Sears posting a bond. Moreover, any award of injunctive relief shall not preclude Sears from
seeking or recovering any lawful compensatory damages which may have resulted from a breach of this Agreement, including a forfeiture of any future payments and a return of any payments and benefits already received by Executive. 

  

					
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 6. Non-Disparagement. Executive will not take any actions that would reasonably be
expected to be detrimental to the interests of Sears or any Sears Affiliate, nor make derogatory statements, either written or oral to any third party, or otherwise publicly disparage Sears or any Sears Affiliate, its products, services, or present
or former employees, officers or directors, and will not authorize others to make derogatory or disparaging statements on Executive’s behalf. This provision does not and is not intended to preclude Executive from entering into any relationship
with a Sears Competitor or Sears Vendor after such relationship is permissible under subsection 4(c) or 4(d), respectively, nor does it preclude Executive from providing truthful testimony in response to legal process or governmental inquiry.

 7. Cooperation. Executive agrees, without receiving additional compensation, to fully and completely cooperate with
Sears, both during and after the period of employment with Sears or any Sears Affiliate (including any Salary Continuation Period), with respect to matters that relate to Executive’s period of employment, in all investigations, potential
litigation or litigation in which Sears is involved or may become involved other than any such investigations, potential litigation or litigation between Sears and Executive. Sears will reimburse Executive for reasonable travel and out-of-pocket
expenses incurred in connection with any such investigations, potential litigation or litigation. 
 8. Future Enforcement or
Remedy. Any waiver, or failure to seek enforcement or remedy for any breach or suspected breach, of any provision of this Agreement by Sears or Executive in any instance shall not be deemed a waiver of such provision in the future. 

9. Acting as Witness. Executive agrees that both during and after the period of employment with Sears or any Sears Affiliate
(including any Salary Continuation Period), Executive will not voluntarily act as a witness, consultant or expert for any person or party in any action against or involving Sears or any Sears Affiliate or corporate relative of Sears, unless subject
to judicial enforcement to appear as a fact witness only. 
 10. Breach by Executive. In the event of a breach by
Executive of any of the provisions of this Agreement, including without limitation the non-competition provisions (Section 4) and the non-disparagement provision (Section 6) of this Agreement, the obligation of Sears or any Sears Affiliate to pay
Salary Continuation or to provide other Severance Benefits under this Agreement will immediately cease and any Salary Continuation payments already received and the value of any other Severance Benefits already received will be returned by Executive
to Sears. Further, Executive agrees that Sears shall be entitled to recovery of its attorneys’ fees and other associated costs incurred as a result of any attempt to redress a breach by Executive or to enforce its rights and protect its
interests under the Agreement. 
 11. Severability. If any provision(s) of this Agreement shall be found invalid,
illegal, or unenforceable, in whole or in part, then such provision(s) shall be modified or restricted so as to effectuate as nearly as possible in a valid and enforceable way the provisions hereof, or shall be deemed excised from this Agreement, as
the case may require, and this Agreement shall be construed and enforced to the maximum extent permitted by law, as if such provision(s) had been originally incorporated herein as so modified or restricted or as if such provision(s) had not been
originally incorporated herein, as the case may be. 

  

					
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 12. Governing Law. This Agreement will be governed under the internal laws of the
state of Illinois without regard to principles of conflicts of laws. Executive agrees that the state and federal courts located in the state of Illinois shall have exclusive jurisdiction in any action, lawsuit or proceeding based on or arising out
of this Agreement, and Executive hereby: (a) submits to the personal jurisdiction of such courts; (b) consents to the service of process in connection with any action, suit, or proceeding against Executive; and (c) waives any other
requirement (whether imposed by statute, rule of court, or otherwise) with respect to personal jurisdiction, venue or service of process. 
 13. Right to Jury. Executive agrees to waive any right to a jury trial on any claim contending that this Agreement or the General Release and Waiver is illegal or unenforceable in whole or in part,
and Executive agrees to try any claims brought in a court or tribunal without use of a jury or advisory jury. Further, should any claim arising out of Executive’s employment, termination of employment or Salary Continuation Period (if any) be
found by a court or tribunal of competent jurisdiction to not be released by the General Release and Waiver, Executive agrees to try such claim to the court or tribunal without use of a jury or advisory jury. 

14. Employment-at-Will. This Agreement does not constitute a contract of employment, and Executive acknowledges that
Executive’s employment with Sears or any Sears Affiliate is terminable “at-will” by either party with or without cause and with or without notice. 
 15. Other Plans, Programs, Policies and Practices. If any provision of this Agreement conflicts with any other plan, programs, policy, practice or other Sears document, then the provisions of this
Agreement will control, except as otherwise precluded by law. Executive shall not be eligible for any benefits under the Sears Holdings Corporation Master Transition Pay Plan or the Kmart Corporation Master Severance Pay Plan or any successor
severance plan or program. 
 16. Entire Agreement. This Agreement, including any exhibits or appendices hereto, contains
and comprises the entire understanding and agreement between Executive and Sears (including any Sears Affiliate) and fully supersedes any and all prior agreements or understandings between Executive and Sears with respect to the subject matter
contained herein, and may be amended only by a writing signed by the Chief Executive Officer, Senior Vice President and President, Talent & Human Capital Services or Senior Vice President, General Counsel and Corporate Secretary (or
equivalent) of Sears. 
 17. Confidentiality. Executive agrees that the existence and terms of the Agreement, including
any compensation paid to Executive, and discussions with Sears (including any Sears Affiliate) regarding this Agreement, shall be considered confidential and shall not be disclosed or communicated in any manner except: (a) as required by law or
legal process; (b) to Executive’s spouse or domestic partner, or (c) to Executive’s financial/legal advisors, all of whom shall agree to keep such information confidential. 

18. Tax Withholding. Any compensation paid or provided to Executive under this Agreement shall be subject to any applicable
federal, state or local income and employment tax withholding requirements. 

  

					
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 19. Notices. All notices and other communications hereunder shall be in writing and
shall be given by hand delivery to the other parties or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows: 
  

					
	 If to the Executive:

 
 If to Sears:
	 	 At the most recent address on file at Sears.

 
 Sears Holdings Corporation
 3333 Beverly Road
 Hoffman Estates, Illinois 60179

		 	Attention to both:	 	Senior Vice President and President, Talent & Human Capital Services
		 		 	Senior Vice President, General Counsel and Corporate Secretary

 20. Assignment. Sears may assign its rights under this Agreement to any successor in interest,
whether by merger, consolidation, sale of assets, or otherwise. This Agreement shall be binding whether it is between Sears and Executive or between any successor or assignee of Sears or affiliate thereof and Executive. 

21. Section 409A Compliance. To the extent that a payment or benefit under this Agreement is subject to Code
Section 409A, it is intended that this Agreement as applied to that payment or benefit comply with the requirements of Code Section 409A, and the Agreement shall be administered and interpreted consistent with this intent. 

22. Counterparts. This Agreement may be executed in one or more counterparts, which together shall constitute a valid and binding
agreement. 
 IN WITNESS WHEREOF, Executive and Sears, by its duly authorized representative, have executed this Agreement on
the dates stated below, effective as of the date first set forth above. 
  

							
	EXECUTIVE	 		 	SEARS HOLDINGS CORPORATION
				
	 	 		 	BY:	 	 
	[                ]	 		 	
	 	 		 	 
	Date	 		 	Date	 	

  

					
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 EXHIBIT A 
 NOTICE: YOU MAY CONSIDER THIS GENERAL RELEASE AND WAIVER FOR UP TO TWENTY-ONE (21) DAYS. YOU MAY NOT SIGN IT UNTIL ON OR AFTER YOUR LAST DAY OF WORK. IF YOU DECIDE TO SIGN IT, YOU MAY REVOKE THE
GENERAL RELEASE AND WAIVER WITHIN SEVEN (7) DAYS AFTER SIGNING. ANY REVOCATION WITHIN THIS PERIOD MUST BE IMMEDIATELY SUBMITTED IN WRITING TO GENERAL COUNSEL, SEARS HOLDINGS CORPORATION, 3333 BEVERLY ROAD, HOFFMAN ESTATES, IL 60179. YOU
MAY WISH TO CONSULT WITH AN ATTORNEY BEFORE SIGNING THIS DOCUMENT. 
 GENERAL RELEASE AND WAIVER 

In consideration for the benefits that I will receive under the attached Executive Severance Agreement, I, and any person acting by,
through, or under me hereby release Sears Holdings Corporation, its current and former agents, subsidiaries, affiliates, employees, officers, stockholders, successors, and assigns (“Sears”) from any and all claims arising out of my
employment or the termination thereof. This General Release and Waiver is to be broadly construed to encompass all claims of any kind or character whatsoever, whether known or unknown, based upon any matter occurring prior to my execution of this
General Release and Waiver and including, but without limiting the generality of the foregoing, any and all claims under the Age Discrimination in Employment Act (“ADEA”), Title VII of the Civil Rights Act of 1964, Section 1981 of the
Civil Rights Act of 1866, the Americans with Disabilities Act (“ADA”), the Employee Retirement Income Security Act (“ERISA”), the Worker Adjustment and Retraining Notification Act (“WARN”), the Family and Medical Leave
Act (“FMLA”) and any other federal, state or local constitution, statute, regulation, or ordinance, and any and all common law claims including, but not limited to, claims for wrongful or retaliatory discharge, intentional infliction of
emotional distress, negligence, defamation, invasion of privacy, and breach of contract. This General Release and Waiver does not apply to any claims or rights that may arise after the date that I signed this General Release and Waiver. I understand
that Sears is not admitting to any violation of my rights or any duty or obligation owed to me. 
 Excluded from this General
Release and Waiver are any claims which cannot be waived by law, including but not limited to (1) the right to file a charge with or participate in an investigation conducted by certain government agencies, and (2) any rights or claims to
benefits accrued under benefit plans maintained by Sears pursuant to ERISA. I do, however, waive my right to any monetary recovery should any agency or other third party pursue any claims on my behalf. I represent and warrant that I have not filed
any complaint, charge, or lawsuit against Sears with any governmental agency and/or any court. 
 I have read this General
Release and Waiver and I understand its legal and binding effect. I am acting voluntarily and of my own free will in executing this General Release and Waiver. 
 I have had the opportunity to seek, and I was advised in writing to seek, legal counsel prior to signing this General Release and Waiver. 

I was given at least twenty-one (21) days to consider signing this General Release and Waiver. Any immaterial modification of this
General Release and Waiver does not restart the twenty-one (21) day consideration period. 

  
 Page 1 of 2

 Return both pages of the signed General Release and Waiver 

 GENERAL RELEASE AND WAIVER (continued) 

I understand that, if I sign the General Release and Waiver, I can change my mind and revoke it within seven (7) days after signing
it by notifying the General Counsel of Sears in writing at Sears Holdings Corporation, 3333 Beverly Road, Hoffman Estates, Illinois 60179. I understand that this General Release and Waiver will not be effective until after this seven (7) day
revocation period has expired. 
  

			
	Date: SAMPLE ONLY—DO NOT DATE	  	Signed by: SAMPLE ONLY—DO NOT SIGN
		
		  	Witness by: SAMPLE ONLY—DO NOT SIGN

  
 Page 2 of 2

 Return both pages of the signed General Release and WaiverLetter from Registrant to Ronald D. Boire

 EXHIBIT 10.38 
 [SEARS HOLDINGS LETTERHEAD] 
 February 10, 2012 

Ronald D. Boire 
 [Address Omitted] 

Dear Ron, 
 The purpose of this letter is to
restate your original offer letter dated December 31, 2011, as agreed to by you and Sears Holdings Corporation (“SHC”). Your start date is January 8, 2012. This letter serves as confirmation of our restated offer, as approved by
the Compensation Committee of SHC’s Board of Directors (“Compensation Committee”). 
 The key elements of your compensation
package are as follows: 
  

	 	•	 	 Your position is Executive Vice President, Chief Merchandising Officer and President, Sears FLS and Kmart Formats. 

 

	 	•	 	 Annual base salary at a rate of $800,000. 

  

	 	•	 	 Participation in the Sears Holdings Corporation Annual Incentive Plan (“AIP”) with an annual incentive opportunity of 150% of your base
salary. If your start date is before January 29, 2012, your target incentive under the 2011 AIP will be prorated from your start date through January 28, 2012, the last day of SHC’s 2011 fiscal year. If your start date is
after January 29, 2012, your target incentive under the 2012 AIP will be prorated from your start date through February 2, 2013, the last day of SHC’s 2012 fiscal year. Notwithstanding the foregoing, with respect to SHC’s 2012
fiscal year, you will be eligible to receive an incentive payment equal to the greater of (a) the actual incentive earned and payable to you under the 2012 AIP or (b) $600,000 (“Special Incentive Award”). The Special Incentive
Award will be reduced by any amount payable to you under the 2012 AIP. Any incentive payable with respect to a fiscal year (including the Special Incentive Award) will be paid by April 15th of the following fiscal year, provided that you are actively
employed at the payment date subject to the Executive Severance Agreement (as referred to below). Further details regarding your AIP target award will be provided to you following your start date. 

 

	 	•	 	 You received, were eligible to receive or will be eligible to receive the following grants of restricted stock under the Sears Holdings Corporation
2006 Stock Plan and subject to the terms of the applicable form of restricted stock award agreement provided by SHC for each grant: 

  

	 	•	 	 An initial grant of 75,000 shares of restricted stock. The grant date is January 9, 2012. The restricted shares granted will be scheduled to vest
one-third on each of the first three (3) anniversaries of the grant date. 

  

	 	•	 	 A second grant of restricted stock with a value of $1,000,000 contingent upon you and your spouse relocating to the greater Chicago metropolitan area.
The number of restricted shares granted will be determined using the market closing price of Sears Holdings shares on the grant date (rounded to the nearest whole share). The grant date will be the first business day of the month following the date
you and your spouse actually relocate to the greater Chicago metropolitan area. If granted, the restricted shares granted will be scheduled to vest in full on the second anniversary of the grant date. 

 Ronald D. Boire 
 February 10, 2012 
 Page 2 

 

	 	•	 	 A match grant of restricted stock (“match grant”) in an amount equal to the number of SHC shares purchased by you in the market within the
first ten (10) clear trading days after the formal public announcement of your hiring, up to a maximum purchase price by you of $250,000, exclusive of commission (“your aggregate stock purchases”). The match grant date will be the
second business day following the date upon which the General Counsel of SHC, Dane Drobny, receives written notice and confirmation of the completion of your aggregate stock purchases. The restricted shares granted under this additional grant will
be scheduled to vest on a graduated basis, with fifty percent (50%) of the total shares granted vesting on each of the first two (2) anniversaries of the grant date. 

 

	 	•	 	 You will be eligible to receive a special sign-on bonus. This sign-on bonus will be payable as follows: 

 

	 	•	 	 $200,000 (gross), 25% of which will be payable within thirty (30) days following your start date and the balance will be paid in three
(3) equal installments beginning on the first payroll period of each subsequent calendar quarter. Notwithstanding the foregoing payment schedule, the gross amount of the sign-on bonus will vest in equal monthly increments over the twelve
(12) month period beginning as of your start date. In the event you voluntarily terminate your employment with SHC or are terminated by SHC for Cause (as defined in the Executive Severance Agreement) within twelve (12) months of your start
date, you will be required to repay the unvested amount of the paid portion of the sign-on bonus. 

  

	 	•	 	 $200,000 (gross), 25% of which will be payable as soon as administratively feasible following the first anniversary of your start date and the balance
will be paid in three (3) equal installments beginning on the first payroll period of each subsequent calendar quarter, provided you remain actively employed through your first anniversary. Notwithstanding the foregoing payment schedule, the
gross amount of the sign-on bonus will vest in equal monthly increments over the twelve (12) month period beginning as of the first anniversary of your start date. In the event you voluntarily terminate your employment with SHC or are
terminated by SHC for Cause within twelve (12) months of the first anniversary of your start date, you will be required to repay the unvested amount of the paid portion of the sign-on bonus. 

 

	 	•	 	 $200,000 (gross), 25% of which will be payable as soon as administratively feasible following the second anniversary of your start date and the balance
will be paid in three (3) equal installments beginning on the first payroll period of each subsequent calendar quarter, provided you remain actively employed through your second anniversary. Notwithstanding the foregoing payment schedule, the
gross amount of the sign-on bonus will vest in equal monthly increments over the twelve (12) month period beginning as of the second anniversary of your start date. In the event you voluntarily terminate your employment with SHC or are
terminated by SHC for Cause within twelve (12) months of the second anniversary of your start date, you will be required to repay the unvested amount of the paid portion of the sign-on bonus. 

If you are required to repay any portion of this sign-on bonus as provided above, you will be required to repay the applicable unvested
amount, including any taxes withheld, unless prohibited by law, to SHC within thirty (30) days of your last day worked. 
  

	 	•	 	 You represent and warrant to SHC that (a) as of your start date with SHC, you are not subject to any obligation, written or oral, containing any
non-competition provision or any other restriction (including, without limitation, any confidentiality provision) that would result in any restriction on your ability to accept and perform this or any other position with SHC or any of its affiliates
and (b) you are not (i) a member of any board of directors, board of trustees or similar governing body of any for-profit, non-profit or not-for-profit entity, or (ii) a party to any agreement, written or oral, with any entity under
which you would receive remuneration for your services, except as 

 Ronald D. Boire 
 February 10, 2012 
 Page 3 

 

	 	disclosed to and approved by SHC in advance of your start date. You agree that you will not (A) become a member of any board or body described in clause (b)(i) of the
preceding sentence or (B) become a party to any agreement described in clause (b)(ii) of the preceding sentence, in each case without the prior written consent of SHC, such consent not to be unreasonably withheld. Further, you agree you
will not disclose or use, in violation of an obligation of confidentiality, any information that you acquired as a result of any previous employment or otherwise. 

 

	 	•	 	 As required, you signed an Executive Severance Agreement (“Agreement”). If your employment with SHC is terminated by SHC (other than for
Cause, death or Disability) or by you for Good Reason (as such capitalized terms are defined in the Agreement), you will receive twelve (12) months of salary continuation, equal to your base salary at the time of termination, subject to
mitigation. Under the Agreement, you agree, among other things, not to disclose confidential information and for twelve (12) months following termination of employment not to solicit employees. You also agree not to aid, assist or render
services for any “Sears Competitor” or “Sears Vendor” (as such terms are defined in the Agreement) for twelve (12) months following termination of employment. The non-disclosure, non-solicitation, non-compete and
non-affiliation provisions apply regardless of whether you are eligible for severance benefits under this Agreement. This offer was contingent upon you signing this Agreement. 

 

	 	•	 	 You will be eligible to receive four (4) weeks paid vacation, which will be pro-rated during your first year of service based on your start date.
Added to this, you will qualify for six (6) paid National Holidays each year. You also will be eligible for up to four (4) personal days per year, after completing six (6) months of service. 

 

	 	•	 	 You will be eligible to participate in all retirement, health and welfare programs on a basis no less favorable than other executives at your level, in
accordance with the applicable terms, conditions and availability of those programs. 

  

	 	•	 	 Your office and primary place of employment will be the Hoffman Estates, Illinois Support Center. You will be provided commuter benefits during
employment and until your relocation to the greater Chicago metropolitan area. These commuter benefits will include (a) weekly round trip commercial air transportation (business class) between the New York and the greater Chicago
metropolitan area, (b) temporary housing allowance of $3,000 per month in the Hoffman Estates area (to be included in your last paycheck each month), (c) ground transportation (i) between your home in New York and the local airport
for travel to the Hoffman Estates office, and (ii) to and from Chicago area airports when commuting to your home in New York (subject to the company’s standard corporate travel policy), (d) shipment of your personal vehicle from your
home in New York to the greater Chicago metropolitan area and (e) breakfast and dinner during commuter travel in the Hoffman Estates area (subject to the meal reimbursement expense requirements set forth in the company’s standard corporate
travel policy). To the extent these commuter benefits are taxable imputed income to you, they will be included in your W-2 wages and the company will add to your pay a cash gross-up equal to 35% of the imputed income amount, to defray a portion
of the taxes due on the imputed income. You will be required to track your commuter expenses separate from your business expenses. Commuter-related expenses cannot be charged to your corporate One Card. You also will be reimbursed for
business travel and other business-related expenses in accordance with the company’s standard corporate travel policy, as appropriate. Eligible business expenses should be charged to your corporate One Card. 

 

	 	•	 	 This offer also was contingent upon satisfactory completion of a background reference check, employment authorization verification and pre-employment
drug test, which were all completed satisfactorily. 

 Ronald D. Boire 
 February 10, 2012 
 Page 4 
 Ron, we are excited about the important contributions you will make to the company and look forward to your acceptance of our offer. If you need additional information or clarification, please call.

 To accept, sign below and return this letter along with your signed Executive Severance Agreement to my attention. 

 

			
	Sincerely,	 	
		
	/s/ Dane A. Drobny	 	 
	Dane A. Drobny	 	

  

			
	Accepted:	 	
		
	/s/ Ronald D. Boire	 	 2/10/2012

	Ronald D. Boire	 	 Date

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