Document:

Employment Agreement

 Exhibit 4.5 

 
 

 
 EMPLOYMENT AGREEMENT 
 This Agreement is between Sears Canada Inc. (“Sears”) and Sharon Driscoll. 
  

	1.	EMPLOYMENT 

  

	1.1	The effective date of this Agreement and your first day in this position is December 21, 2010 (the “Effective Date”). 

 

	1.2	You will be employed with Sears on a regular, full-time basis. 

  

	1.3	Subject to the terms of this Agreement, your position will be Senior Vice-President and Chief Financial Officer, initially reporting to the President and Chief
Executive Officer. Sears may change the reporting relationship at any time in its sole discretion, without prior notice to you and you agree that any such change in the reporting will not constitute a breach of this agreement, a dismissal without
cause or a constructive dismissal of your employment. 

 In this position you will be responsible to perform those
services that are normally or usually associated with that position and such other duties that may be delegated to you. Services include and may not be limited to the responsibility for Sears’ fiscal operating results, the development,
implementation, and leadership of the coporate plan and programs related to accounting, finance, audit, taxation, and treasury. You will be responsible for financial activities related to the development, analysis and interpretation of accounting
and statistical information in order to appraise operating results in terms of profitability, performance against budget and other matters bearing on the financial soundness and operating effectiveness of the company. 

 

	1.4	Sears standard workweek is 40 hours. However, you will be required to devote whatever time is reasonably necessary to complete the requirements of your position, which
may exceed 40 hours per week from time to time, without entitlement to overtime pay. 

  

	1.5	You acknowledge and agree that in order for Sears to meet business demands, Sears may in its sole discretion modify, change, reduce or add to your duties and
responsibilities from time to time, as long as the accountabilities are diminished in relation to the current scope of the role. 

  

	1.6	You agree that no representation or inducement has caused you to leave any previous employment. 

 

	2.	COMPENSATION 

  

	2.1	Effective as of the Effective Date, Sears will pay you a base salary of $375,000.00 per annum, less deductions required by law, paid monthly via direct deposit. Any
salary increases will be administered in accordance with Sears policy. 

  

	2.2	You will receive a signing bonus of $50,000.00 (less statutory deductions). Should you voluntarily terminate your employment within (1) year from the date of
payment, you agree to reimburse Sears the entire amount of the signing bonus and you authorize Sears to deduct the amount from your final pay, including but not limited to regular salary, vacation pay, termination pay and severance pay. Any
incremental amounts owing will be paid to Sears before the termination date. 

  

	2.3	 You are entitled to four (4) weeks of annual vacation time per year, accrued over the course of each calendar year and pro-rated for partial years
of employment. All vacation must be taken annually and where possible, should be taken in periods of one or two 

  

					
	December 2010	  		  	

 
weeks at a time as approved in advance by your manager. Any increases in your annual vacation will be earned based on company policy, which may be amended from time to time. 

 

	2.4	You will continue to be eligible to participate in the Sears flexible benefit plan, under the terms of the plans which may be amended from time to time, commencing on
the first day of your active employment with Sears. You have been provided with a booklet setting out eligibility rules and coverage offered under the plans prior to signing this Agreement. 

 

	2.5	You will continue to be eligible for the Sears salaried Associate Discount Benefit, in accordance with the Associate Discount Policy with which you have been provided
prior to signing this Agreement and which may be amended from time to time. 

  

	2.6	You will continue to be eligible to participate in the Sears defined contribution pension plan, in accordance with the terms of the plan which may be amended from time
to time. 

  

	2.7	You will continue to be eligible to participate in our corporate incentive program, under the terms of that program which may be amended from time to time (the
“Annual Incentive Program”). The Annual Incentive Program is designed to pay out upon achievement of specific corporate, team and individual performance goals. Any payments under the Annual Incentive Program are disbursed after the fiscal
year end. In order to receive payment under the Annual Incentive Program, you must be actively employed on the date of the pay out. For clarity, in the event that your employment with Sears ceases for any reason prior to the pay out date, no period
of notice of termination that was, or ought to have been provided, will be included in calculating active service. 

Each year there is a threshold of corporate performance that is established, and must be met before any payment under the Annual Incentive
Program can be made. 
 At your level, the Annual Incentive Program is designed to pay a target incentive of 60% of your base
salary based upon achievement of specific corporate, team and individual performance goals. Your annual incentive payment under the Annual Incentive Program will be based on your base salary in effect in the applicable fiscal year. 

The determination of the amount of the payout is based upon your achievement of specific goals. 

 

	2.7	You will continue to be eligible to participate in the The Long Term Incentive Plan (LTIP), which is based on cumulative EBITDA goals for a 3 fiscal year cycle with a
new cycle being introduced on an annual basis. The target payout for eligible associates is a percentage of earnings which is pre-set for each LTIP eligible position. At your level, the LTIP is designed to pay a target incentive of 90% of your base
salary. Your LTIP amount will be based on your base salary in effect in the applicable fiscal year. The Plan design, rules and payout for each performance period are subject to approval by the Human Resources and Compensation Committee of the Board
of Directors on an annual basis and subject to change. 

  

	2.8	You will be eligible for all perquisites at the level of Senior Vice-President of Sears plus an additional allowance of three hundred dollars ($300) net per month for
parking. 

  

	3	CESSATION OF EMPLOYMENT 

  

	3.1	Subject to Section 1.4, you may resign from employment with Sears, at any time upon providing two weeks’ written notice, which can be waived in whole or in
part by Sears. 

  

					
	December 2010	  	2	  	

 Sears may terminate your employment at any time for just cause without notice or pay in lieu
of notice, in which event your participation in the Sears group insurance benefits plan, pension plan and Annual Incentive Program shall immediately cease. 
 Should Sears terminate your employment at any time without just cause following the Effective Date, you will be provided with a severance package consisting of the greater of: 

 

	 	(i)	twelve (12) months of base pay, or 

  

	 	(ii)	such base pay in lieu of notice and severance pay, if applicable, as required under the applicable Employment Standards legislation, as may be amended, or

  

	 	(iii)	two (2) weeks’ base pay for each completed year of service to a maximum of seventy eight (78) weeks of base pay (which is inclusive of all termination
and severance pay to which you may be entitled in accordance with the applicable Employment Standards legislation). 

 (the “Severance Period”) 
 and continuance of all benefits (inclusive of
perquisites)during the Severance Period. 
 Any severance payments for base pay, as determined above, shall be made by way of
salary continuance and notwithstanding any other provisions herein, if you secure alternate employment, Sears’ obligations to pay salary continuance and benefits during the Severance Period shall cease, effective on the date of your
reemployment. 
 Upon payment of the amounts specified above, you shall have no claim against Sears in respect of employment for
damages or otherwise, except in respect of payment of monies earned, due or owing to date of termination. Sears shall have no obligation to make the payments described in Sections 3.1(i) and 3.1 (iii) until or unless you execute and deliver to
Sears a release in the form attached hereto as Schedule “A”. Should you elect not to execute and deliver such release, you shall only be entitled to receive such notice of termination, and severance pay, if applicable, to which you are
entitled pursuant to the Employment Standards legislation, as amended from time to time. Your participation in the Annual Incentive Program and the Long-Term Incentive Plan will cease as of the last day of active employment. 

 

	3.4	At the time your employment with Sears ceases, any vacation that you have taken in excess of that which you have accrued to date will be deducted from any outstanding
income owed to you, including but not limited to regular salary, vacation pay, termination pay and/or severance pay 

  

	3.5	You agree to promptly return all Sears property at the time of cessation of employment for any reason. 

 

	4.	PROTECTIVE COVENANTS 

 4.1 In
consideration of the offer set out herein and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, you agree to the following: 
 (a) Non-Disclosure and Non-Solicitation. You acknowledge and agree to be bound by the following: 
 i. Non-Disclosure of Sears Confidential Information. You will not, during the term of your employment with Sears or thereafter, 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 herein) until such time as the information becomes publicly known other than as a result of its disclosure, directly or indirectly, by you.

  

					
	December 2010	  	3	  	

 ii. Sears Confidential Information. For purposes of this Agreement,
“Sears Confidential Information” means trade secrets and non-public information which Sears 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, 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 that is not known generally to the public or in the industry. 

iii. Non-Solicitation of Employees. During your employment with Sears and for two (2) years from the date of
termination, regardless of the reason for such termination, you shall not, directly or indirectly, solicit or encourage any person to leave her/his employment with Sears or assist in any way with the hiring of any Sears employee by any future
employer or other entity. 
 (b) Non-Competition. You acknowledge that as a result of your position at Sears you have
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 you were to render advice or services to any Sears Competitor. 

i. Therefore, should you voluntarily resign from your employment with Sears, for one year from the date of your
resignation, you 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. 
 ii. For purposes of this Agreement, “Sears
Competitor” means: 
 1. Those companies listed on Schedule B hereto, each of which you
acknowledge is a Sears Competitor, whether or not it falls within the categories in subsection 4.1(b)(iii) (2A) below, and further acknowledges that this is not an exclusive list of Sears Competitors and is not intended to limit the generality
of subsection 4.1(b)(iii)(2A), below; and 
 iii. 2.(A) Any party 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, auto parts and/or apparel products, or providing home
improvement, product repair and/or home services, with combined annual revenue in excess of $1 billion, (B) any vendor with combined annual gross sales of services or merchandise to Sears in excess of $200 million, or (C) a party engaged
in any other line of business, in which Sears has commenced business prior to your date of termination, with Sears having annual gross sales in that line of business in excess of $100 million. 

iv. You acknowledge that Sears shall have the right to modify Schedule B 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 your prior written consent, which consent shall not be unreasonably withheld 

v. Compliance with Protective Covenants. You will provide Sears with such information as Sears may from time to
time reasonably request to determine your compliance with this Section 4. You release Sears, its agents and employees, from all liability for any damage arising from any such contacts or communications 

  

					
	December 2010	  	4	  	

 vi. Necessity and Reasonableness. You agree 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. You further agree and acknowledge that the provisions of this Agreement are
reasonable, in particular the definition of “Sears Competitor”. You further recognize and expressly acknowledge that: (i) the application of Section 4 of this Agreement will not have the effect of prohibiting you from earning a
living in a satisfactory manner in the event of the termination your employment for any reason, and (ii) Sears would be subject to an irreparable prejudice should one or several of the provisions of Section 4 be infringed. 

 

	5.	ONGOING OBLIGATIONS OF EMPLOYMENT 

  

	5.1	All Sears associates are required to comply with the Code of Business Conduct (the “Code”), which may be amended from time to time, and to certify their
understanding and compliance in writing on an annual basis. The Code is attached for your review. 

 Additional
information regarding Sears policies and procedures can be obtained on the Sears Intranet. You are encouraged to become familiar with our internal site. 
  

	5.2	As an ongoing requirement of employment with Sears, you agree: 

  

	 	(a)	To continue to maintain legal immigration status to work within the country in which you are, or will be, employed by Sears and to continue to meet the requirements of
the applicable immigration legislation and regulations of that country; 

  

	 	(b)	That you understand and consent to the fact that in the course of employment, Sears will be required, from time to time, to collect, use and disclose personal
information in order to administer the employment relationship; 

  

	 	(c)	That you understand that any information relating to Sears policies, processes, structures, operations, customers, or other associates acquired by you in the course of,
or as a result of, your employment with Sears is confidential. Such information shall be treated as confidential, and may not be disclosed by you to any other person, firm or company without prior written authorization. Confidential information or
material includes but is not limited to financial information, plans, strategies, corporate information, and any other information deemed “confidential”, unless such information is available to the general public or in the public domain;

  

	 	(d)	That you understand that Sears shall retain all rights attached to any of the work, products or results created, produced or manufactured by you arising out of or
related to your employment. Such ownership and the sole right to obtain copyright in such property shall be vested in Sears, and Sears shall be at liberty to effect and be responsible for the registration, use, disbursement and other protection of
such property as it may seem fit. 

  

	6.	GENERAL 

  

	6.1	The titles and descriptive headings of the articles of this Agreement are inserted solely for convenience, are not part of this Agreement and do not in any way limit or
amplify this Agreement. 

  

	6.2	In the event of any conflict or inconsistency between the provisions of this Agreement and the provisions of any Schedule hereto or any document herein, the provisions
of this Agreement shall prevail. 

  

					
	December 2010	  	5	  	

	6.3	In the event that any provision, or part thereof contained in this Agreement, or any schedule of this Agreement is prohibited or declared invalid, illegal or
unenforceable by a court or other lawful authority, this Agreement and all schedules to this Agreement shall continue in force, with respect to the enforceable provisions, and all rights and remedies accrued under the enforceable provisions shall
survive any such declaration. 

  

	6.4	This Agreement and any schedules or documents incorporated by reference herein constitute the entire Agreement between Sears and you and supersedes all prior
negotiations and oral and written representations and understandings, if any. 

  

	6.5	No supplement, waiver, amendment, modification or rescission of this Agreement shall be binding unless set forth in writing and signed by Sears.

  

	6.6	This Agreement shall enure to the benefit and be binding upon each party and its heirs, executors, administrators, successors and permitted assigns.

  

	6.7	This Agreement shall be governed by and construed in accordance with the laws in force in the Province of Ontario and shall be treated in all respects as an Ontario
contract. The parties submit to the jurisdiction of the Courts of Ontario with respect to any dispute, claim or other matter arising under this Agreement and the Courts of Ontario shall have exclusive jurisdiction with respect to any such dispute,
claim or other matter. 

  

	6.8	You hereby represent and warrant that you are not party to or bound by the terms of any agreement with any previous employer or any other party that would prevent you
from performing services for Sears. You further represent and warrant to Sears that in the performance of your duties for Sears you shall not improperly bring to Sears or use any trade secrets, confidential information or other proprietary
information of any third party; and that you will not infringe the intellectual property rights of any third party. 

  

	6.9	You acknowledge that you have been given the opportunity to read, evaluate and discuss the provisions of this Agreement and the attached documents with your personal
advisors and with representatives of Sears. 

  

	6.10	In consideration of accepting this agreement from Sears, you expressly authorize Sears to deduct and withhold any documented amounts owing to Sears, including but not
limited to any vacation taken in excess of accrued entitlement, from any sums owing by Sears to you. You acknowledge that this paragraph constitutes a formula from which a specific amount may be calculated and is good and sufficient authorization
for the purposes of all applicable legislation. 

 IN WITNESS WHEREOF the parties hereto by their duly authorized
representatives have executed this Agreement as of the date first above mentioned. 
  

					
	SEARS CANADA INC.	    	SHARON DRISCOLL	  	 
			
	Per:     /s/ Dene
Rogers                                        
                  	    	 /s/ Sharon Driscoll
	  	
	 Name: Dene Rogers
	    	Signature	  	
	 Title:   President and
	    	  
	  	
	             Chief Executive Officer
	    	(Witness Name – please print)	  	
		    	  
	  	
		    	(Witness Signature)	  	

  

					
	December 2010	  	6	  	

 Schedule A 
 SETTLEMENT AND RELEASE AGREEMENT 
 IN CONSIDERATION of the provision of the terms
set out in the Letter of Termination dated ______ and hereto attached and the Minutes of Settlement entered into between Sears Canada Inc. and _________________ dated _______ and hereto attached and other good and valuable consideration, the
sufficiency of which is hereby acknowledged, I, _________________, on behalf of myself, my heirs, successors, administrators and assigns (hereinafter collectively referred to as the “Releasor”), agree to hereby release and forever
discharge Sears Canada Inc., its parents, affiliates and associated companies, subsidiaries, officers, directors, employees, servants, agents and their successors and assigns, (collectively, “Sears”) jointly and severally from any and all
actions, causes of actions, contracts, covenants, whether express or implied, but not limited to, any bonus claims of any nature and kind whatsoever, any vacation pay entitlements, claims and demands for damages, including any disability claims,
loss of benefit claims, indemnity, costs, interest, loss or injury of every nature and kind whatsoever and howsoever arising, whether statutory or otherwise and specifically including, but not limited to, any claim under the applicable Employment
Standards legislation (including but not limited to claims for wages, notice, severance, vacation pay or termination pay), Human Rights Code, Labour Relations Act, Occupational Health and Safety Act and Workplace Safety and
Insurance Act, and any successor legislation, which I may heretofore have had, may now have, or may hereinafter have, in any way relating to my engagement by, hiring by, my employment with or the cessation of my engagement/employment by Sears.

 I AGREE not to make any claims or demands, or commence, maintain or prosecute any action, cause or proceeding for damages, compensation, loss
or any other relief whatsoever against Sears arising out of my employment with Sears or the termination of that employment. I further agree that this Settlement and Release Agreement shall operate conclusively as an estoppel and complete bar in the
event of any such claim, action or proceeding, and may be plead as such, and that I will be liable to Sears for its costs and expenses, including reasonable legal fees, incurred in responding thereto. For clarity, I further agree that, as a
condition of this Settlement and Release Agreement, I will take all necessary steps to ensure the withdrawal or dismissal of such claim or complaint. 
 I ACKNOWLEDGE AND AGREE that I shall not make any claim or demand or take any action or proceeding in connection with any matter covered by this Settlement and Release Agreement against any other person
or corporation who might claim contribution or indemnity from Sears by virtue of the said claim or proceeding. I agree that if any such claim, demand, action or proceeding is made by me, Sears may raise this document as an estoppel and complete bar
to any such claim, demand, action or proceeding and that I will be liable to Sears for its costs and expenses, including reasonable legal fees, incurred in responding thereto. 
 AND FOR THE SAID CONSIDERATION, I hereby confirm that I have considered whether I have any possible claim against Sears in respect of the applicable Human Rights Code, and confirm that I
either have no such claim or that this Settlement and Release Agreement expressly compensates me for any such claim and that I seek no further right or remedy in respect of any possible claim. 

I AGREE that the terms and conditions of this Settlement and Release Agreement are confidential and I undertake not to divulge or communicate its
contents, in whole or in part, directly or indirectly, to anyone other than to receive professional advice. 
 I AGREE that in the event I
should file any legal complaint with respect to the cessation of my employment with Sears contemplated hereunder, I will immediately reimburse Sears for any and all consideration provided pursuant to this Settlement and Release Agreement.

  

					
	December 2010	  	7	  	

 I AGREE not to, at any time, publicly comment in any adverse fashion, whether verbally or in writing, about
any Sears present or former employees, officers, or directors. 
 I ACKNOWLEDGE AND AGREE to indemnify and save harmless Sears from any and all
claims or demands under the Income Tax Act of Canada, the Income Tax Act of the applicable Province the Canada Pension Plan, the Employment Insurance Act of Canada, including any regulations made under the Employment
Insurance Act, and any other statute or regulations for or in respect of any failure on Sears to withhold income tax, Canada Pension Plan premiums, employment insurance premiums or benefit overpayments or any other tax premium, payment of levy
from all or any part of the consideration and any interest or penalties relating to the failure to withhold any costs or expenses incurred in defending such claims or demands. 
 I ACKNOWLEDGE AND AGREE that during my employment I acquired confidential information which is the exclusive property of the Sears which I shall not use in any manner without the express written
permission of Sears. I recognize that all material and information that has been disclosed to me during my employment is confidential information that could be used to the detriment of the Sears. As such, I will fulfill my obligations to hold
confidential the information I received during my employment with Sears. I acknowledge and agree that the requirement to keep confidential the information acquired by me during my employment is reasonable and necessary for the protection of Sears.

 I ACKNOWLEDGE AND AGREE that the giving of the consideration herein is not deemed to be any admission of liability on the part of Sears and,
in fact, liability is expressly denied. 
 I ACKNOWLEDGE AND AGREE that in the event that any provision of this Settlement and Release Agreement
is deemed void, invalid or unenforceable by a court of competent jurisdiction, the remaining provisions shall remain in full force and effect. 

THIS SETTLEMENT AND RELEASE AGREEMENT has been made in, and shall be construed in accordance with the laws of the Province of Ontario, and shall enure to
the benefit of, and be binding upon me and my heirs, executors, administrators, legal and personal representatives, successors, and assigns. 

I DECLARE THAT I fully understand the terms of this Settlement and Release Agreement and have had the opportunity to obtain independent legal advice
prior to executing this document, and that I have signed this document freely, voluntarily and without constraint. I voluntarily accept the consideration offered for the purpose of making full and final compromise and settlement of all claims as
noted above. 
 IN WITNESS WHEREOF I have executed this Settlement and Release Agreement at ________________, 

DATE: _____________________________, 200_ 
  

			
	 SIGNED, SEALED AND DELIVERED IN THE PRESENCE OF

		
	 _____________________________

Associate Name
	  	 _____________________________

        WITNESS

		
	 _____________________________

Print name:
	  	 _____________________________

Print name:

  

					
	December 2010	  	8	  	

 Schedule B 
 The following companies (including in each case subsidiaries controlled by the company and successors to the business of the company in Canada): 
 Hudson’s Bay Company (Hbc) (including the Zellers Inc. and Home Outfitters divisions), Canadian Tire Corporation Limited, Wal-Mart Canada Corporation, Best Buy Canada Ltd., Gap Inc. (including the
Banana Republic and Old Navy divisions), Office Depot Inc., InterTAN Canada Ltd.(currently doing business as “The Source by Circuit City”), The Home Depot Inc., Le Group RONA Inc. (RONA), Home Hardware Stores Limited, Reitmans (Canada)
Limited, Loblaw Companies Limited, Staples, The Business Depot, Ltd. 

  

					
	December 2010	  	9Employment Agreement

 Exhibit 4.6 

 
 

 
 EMPLOYMENT AGREEMENT 
 This Agreement is between Sears Canada Inc. (“Sears”) and Tom Fitzgerald. 
  

	1.	EMPLOYMENT 

 The effective
date of this Agreement and your first day in this position is May 16, 2011 (the “Effective Date”). This offer and the agreement arising from this offer is subject to the approval of the Human Resource and Compensation Committee and
the Board of Directors of Sears Canada Inc. In addition, if the requirements of Sections 6 and 7 are not satisfied before the first day of work, then this Agreement, at Sears’s option, is terminated and if so, the offer of employment contained
herein is rescinded. 
  

	1.1	You will be employed with Sears on a regular, full-time basis. 

  

	1.2	You will initially be employed to work at Sears Toronto location, however, Sears may, at its sole discretion, appoint another work location in the future that is not
more than thirty miles from Toronto, Ontario. 

  

	1.3	Your position will be EVP, and Chief Administrative Officer reporting to the President and CEO. You will be responsible for Finance, Supply Chain, Merchandise
Procurement (corporate procurement and corporate sourcing), Logistics, Store Operations, and Information Technology. A more detailed description of your duties and responsibilities will be discussed with you upon commencement in the role.

  

	1.4	Sears standard workweek is 40 hours. However, you will be required to devote whatever time is necessary to complete the requirements of your position, which may exceed
40 hours per week from time to time, without entitlement to overtime pay. 

  

	1.5	You acknowledge and agree that in order for Sears to meet business demands, Sears may in its sole discretion modify, change, reduce or add to your duties and
responsibilities from time to time and you agree that any such change in duties will not constitute a breach of this agreement, a dismissal without cause or a constructive dismissal of your employment. In the event your reporting relationship
changes such that you no longer report to the President and CEO, then if you notify Sears within 30 days of such change in writing, and Sears does not rectify the reporting relationship, then you may immediately notify Sears in writing that you are
electing to have your employment deemed terminated without cause and the applicable provisions of section 4 will apply. 

  

	1.6	You agree that no representation or inducement has caused you to leave any previous employment. 

 

	2.	COMPENSATION 

  

	2.1	Sears will pay you a base salary of $650,000 (CDN) per annum, less deductions required by law, paid monthly via direct deposit. Any salary increases will be
administered in accordance with Sears’ policy. 

  

	2.2	You are entitled to four (4) weeks of annual vacation time per year. All vacation must be taken annually and where possible, should be taken in periods of one or
two weeks at a time as approved in advance by your manager. Future entitlement will be earned based on company policy, which may be amended from time to time. 

 

	2.3	You will be eligible to participate in the Sears Flexible Benefit Plan, under the terms of the plan which may be amended from time to time, commencing on the first of
the month following or coincident with your date of hire. A booklet setting out eligibility rules and coverage offered under the plan will be mailed directly to your home. 

  

					
	April 26, 2011	  		  	

	2.4	You will be eligible for the Sears Associate Discount Benefit, in accordance with the Associate Discount Policy which may be amended from time to time.

  

	2.5	You may be eligible to participate in the Sears Defined Contribution Pension Plan, in accordance with the terms of the plan which may be amended from time to time. The
details and coverage levels will be discussed with you in more detail after the Effective Date. 

  

	2.6	You will be eligible to participate in our corporate incentive program, under the terms of the program as amended from time to time (the “Annual Incentive
Program”). The Annual Incentive Program provides a Target Incentive Opportunity of 75% of your base salary at your pay band. In order to receive payout under the Annual Incentive Program, you must be actively employed on the date of payout. The
term “actively employed” does not include any period of reasonable or statutory notice or any period of deemed employment or salary continuance. More information on the Annual Incentive Program will be provided to you upon your
commencement in the role. 

  

	2.7	For fiscal 2011, you are eligible to receive a Target Incentive Opportunity of 75% of your base pay (“2011 Target AIP”) (for the avoidance of doubt, this
amount which equals $346,875 has been pro-rated to your date of employment). Should Sears not meet the targets established for a payout at that level under the 2011 AIP, you will receive a special incentive payment, paid in accordance with the terms
of the 2011 AIP equal to 75% of the 2011 Target AIP less your actual payout under the 2011 AIP based on Sears’ performance (“Your Actual 2011 AIP Award”). In the event that Sears fiscal 2011 performance exceeds levels associated with
a 75% 2011 Target AIP payout under the 2011 AIP, you shall not be eligible for a payment under this section 2.7. In order to be eligible to receive the amounts set out in this subsection 2.7, you must be actively employed on the date of payout. The
term “actively employed” does not include any period of reasonable or statutory notice or any period of deemed employment or salary continuance. 

  

	2.8	You will be eligible to participate in the 2011-2013 Long Term Incentive plan (LTIP) cycle under the terms of the plan which may be amended from time to time. The
target payout for eligible associates is a percentage of earnings which is pre-set for each LTIP eligible position. At your level, the LTIP is designed to pay a target incentive of 200% of your base pay. Your LTIP amount will be based on your base
salary in effect in the applicable fiscal year. In order to receive a payout under the LTIP, you must be actively employed on the date of payout. The term “actively employed” does not include any period of reasonable or statutory notice or
any period of deemed employment or salary continuance. Notwithstanding the terms of the LTIP, the target incentive of 200% of your base salary for the 2011-2013 LTIP cycle will not be pro-rated to your date of employment. 

 

	3.	SIGNING BONUS AND RELOCATION 

  

	3.1	 Sears will provide you a one-time signing bonus of $220,000 CDN (gross) (the “Signing Bonus”) and Sears will provide you with a one-time
payment of $150,000 CDN (net) (the “Relocation Payment”), to assist you with your relocation for your move to Toronto, Ontario. The first 50% installment of the Signing Bonus ($110,000) CDN (gross) shall be payable to you within 30 days of
your start date and the remaining installment ($110,000) CDN (gross) shall be payable upon your move to Toronto, or at such earlier time to fund a down payment for you on a place of living in Ontario. The first 50% installment of The Relocation
Payment ($75,000) CDN (net) shall be payable to you within 30 days of your start date. The remaining installment ($75,000) CDN (net) shall be payable upon your 

  

					
	April 26, 2011	  	2	  	

	 	
move to Toronto, Ontario. Should you resign from your employment with Sears at any time after the Effective Date and within 12 months from your relocation to Toronto, Ontario, you agree to
reimburse Sears 100% of the Signing Bonus and 100% of the Relocation Payment and you authorize Sears to deduct this amount from your final pay, including but not limited to regular salary and vacation pay. Should you resign from your employment with
Sears between 13 and 24 months from the date of your move to Toronto, you agree to reimburse Sears 50% of the Signing Bonus and 50% of the Relocation Payment and you authorize Sears to deduct this amount from your final pay, including but not
limited to regular salary and vacation pay. Should Sears decide to terminate your employment, on a without cause basis, you will not be required to repay the Signing Bonus or the Relocation Payment. Should you be terminated with cause, you’ll
be required to repay the Signing Bonus and the Relocation Payment in accordance with the same schedule as your resignation set out above. 

  

	3.2	You will be provided with reasonable expenses to assist you with commuting from the effective date of your agreement to September 1, 2011. These include but are
not limited to meals and transportation to and from an airport and up to a maximum of $2,000 CDN (net) per month for lodging. Relocation to Toronto, Ontario must occur within six (6) months from the Effective Date of this Agreement.

  

	3.3	For fiscal 2012, you are eligible to receive a special retention bonus of $300,000 CDN gross reduced by the sum of (1) the amount Your Actual 2011 AIP Award
exceeds 75% of your 2011 Target AIP and (2) the amount of your actual 2012 AIP award. This amount will be payable in accordance with the terms of the 2012 AIP. In order to be eligible to receive the amounts set out in this subsection 3.3, you
must be actively employed on the date of payout. The term “actively employed” does not include any period of reasonable or statutory notice or any period of deemed employment or salary continuance. 

 

	4.	CESSATION OF EMPLOYMENT 

  

	4.1	You may resign from Sears at any time upon providing two weeks written notice, which can be waived in whole or in part by Sears. 

 

	4.2	Sears may terminate your employment at any time for cause without notice or pay in lieu of notice, in which event your participation in the Sears benefits plan, pension
plan and Annual Incentive Plan shall immediately cease. 

  

	4.3	Should Sears decide to terminate your employment, on a without cause basis within the first month of your effective date, you will receive 3 months of base pay of
severance which will be subject to standard deductions. For each completed month of service after your first month of service prior to your move to Toronto, Ontario, you will be eligible for an additional month of base pay of severance subject to
standard deductions. 

  

	4.4	Should Sears decide to terminate your employment, on a without cause basis after you have moved to Toronto, Ontario, and no future agreement is executed which
supersedes this current agreement, you will be provided with the greater of: (i) twelve (12) months of base pay and 75% of your targeted AIP or (ii) 2 weeks notice (or base pay in lieu of notice or a combination thereof) for each
completed year of service to a maximum of seventy eight (78) weeks of base pay (which is inclusive of all termination and severance pay to which you may be entitled in accordance with the applicable Employment Standards legislation). Any AIP
bonus paid pursuant to this section, will be paid in a lump sum at the time that AIP payments relating to such period are to be made to other Associates of Sears. 

 Any severance payments for base pay, as determined above, shall be made by way of salary continuance and notwithstanding any other provisions herein, Sears obligations

  

					
	April 26, 2011	  	3	  	

	 	
hereunder shall be reduced on a dollar-for-dollar basis (but not below zero), by the amount, if any, of fees, salary, wages or other compensation that you earn from a subsequent employer
(including those arising from self-employment) during the salary continuation period. 

  

	4.5	Upon termination of your employment with Sears for any reasons under the terms of this Agreement (whether initiated by you or Sears), you will execute a binding general
release and waiver of claims in a form attached as Schedule “A” hereto, which is incorporated by reference herein. Upon payment of this amount, you shall have no claim against Sears in respect of employment for damages or otherwise, except
in respect of payment of monies earned, due or owing to date of termination. Sears shall have no obligation to make the payments described in Section 4.3, or 4.4 until or unless you execute and deliver to Sears a release in the form attached
hereto as Schedule “A”. Should you elect not to execute and deliver such release or should you subsequently revoke such release, you shall only be entitled to receive such notice of termination, and severance pay, if applicable, to which
you are entitled pursuant to the Employment Standards legislation, as amended from time to time. 

 In the absence
of cause, you would be entitled to continue in the Sears benefits plans and pension plan during the severance period in accordance with the applicable Employment Standards legislation. Your participation in the Annual Incentive Program and Long-Term
Incentive Program will cease as of the last day of active employment. 
  

	4.6	At the time your employment with Sears ceases, any vacation that you have taken in excess of that which you have accrued to date will be deducted from any outstanding
income owed to you, including but not limited to regular salary, vacation pay, termination pay and/or severance pay. 

  

	4.7	You agree to promptly return all Sears property at the time of cessation of employment for any reason. 

 

	4.8	For the purposes of this agreement “cause” shall mean (i) a material breach by you (other than a breach resulting from your incapacity due to a
disability) of your duties and responsibilities which breach is demonstrably willful and deliberate on your part, is committed in bad faith or without reasonable belief that such breach is in the best interests of Sears and is not remedied in a
reasonable period of time after receipt of written notice from Sears specifying such breach; (ii) the commission by you of a felony; or (iii) dishonesty or willful misconduct in connection with your employment. 

 

	5.	PROTECTIVE COVENANTS 

  

	5.1	In consideration of the offer set out herein and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, you agree to the
following: 

 (a) Non-Disclosure and Non-Solicitation. You acknowledge and agree to be bound by the
following: 
 i. Non-Disclosure of Sears Confidential Information. You will not, during the term of your
employment with Sears or thereafter, 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 herein) until such time as the
information becomes publicly known other than as a result of its disclosure, directly or indirectly, by you. 

ii. Sears Confidential Information. For purposes of this Agreement, “Sears Confidential
Information” means trade secrets and non-public information which Sears designates as being confidential or which, under the circumstances, should be treated 

  

					
	April 26, 2011	  	4	  	

 
as confidential, including, without limitation, any information received in confidence or developed by Sears, 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 that is not
known generally to the public or in the industry. 
 iii. Non-Solicitation of Employees. During your
employment with Sears and for two (2) years from the date of termination, regardless of the reason for such termination, you shall not, directly or indirectly, solicit or encourage any person to leave her/his employment with Sears or assist in
any way with the hiring of any Sears employee by any future employer or other entity. 
 (b) Non-Competition. You
acknowledge that as a result of your position at Sears you have 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 you were to render
advice or services to any Sears Competitor. 
 i. Therefore, should you voluntarily resign from your employment
with Sears, you will not, for one (1) year from the date of your resignation, 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. 
 ii. For purposes of this Agreement, “Sears Competitor” means: 
 1. Those Canadian operations of the companies listed on Schedule B hereto, each of which you acknowledge is a Sears Competitor, whether or not it falls within the categories in subsection
4.1(b)(ii) (2), below, and further acknowledges that this is not an exclusive list of Sears Competitors and is not intended to limit the generality of subsection 4.1 (b)(ii)(2), below; and 

2.(A) Any party 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, auto parts and/or apparel products, or providing home improvement, product repair and/or home services, with combined
annual revenue from Canadian operations in excess of $1 billion, (B) any vendor with combined annual gross sales of services or merchandise to Sears in excess of $200 million, or (C) a party engaged in any other line of business, in which
Sears has commenced business prior to your date of resignation with Sears having annual gross sales in that line of business in excess of $100 million. 
 iii. You acknowledge that Sears shall have the right to modify Schedule B periodically to include (1) emergent Canadian competitors in Sears existing lines of business and (2) Canadian
competitors in lines of business that are new for Sears, in each case, with your prior written consent, which consent shall not be unreasonably withheld. 
 (c) Compliance with Protective Covenants. You will provide Sears with such information as Sears may from time to time reasonably request to determine your compliance with this Section 4. You
release Sears, its agents and employees, from all liability for any damage arising from any such contacts or communications. 

(d) Necessity and Reasonableness. You agree 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. You further agree and 

  

					
	April 26, 2011	  	5	  	

 
acknowledge that the provisions of this Agreement are reasonable, in particular the definition of “Sears Competitor”. You further recognize and expressly acknowledge that: (i) the
application of Section 4 of this Agreement will not have the effect of prohibiting you from earning a living in a satisfactory manner in the event of your resignation of employment, and (ii) Sears would be subject to an irreparable
prejudice should one or several of the provisions of Section 4 be infringed. 
  

	6.	ONGOING OBLIGATIONS OF EMPLOYMENT 

  

	6.1	This offer is conditional upon successful completion of all educational verifications, and confirmation that you are legally entitled to work in Canada. All Sears
associates are required to comply with the Code of Business Conduct (the “Code”), which may be amended from time to time, and to certify their understanding and compliance in writing on an annual basis. The Code is attached for your
review. Please review the Code before the start of your employment, and ensure that you get clarification from your manager if you are unclear on any requirements contained in the Code. 

Additional information regarding Sears policies and procedures can be obtained on the Sears Intranet. You are encouraged to become
familiar with our internal site. 
  

	6.2	As an ongoing requirement of employment with Sears, you agree: 

  

	 	(a)	To continue to maintain legal immigration status to work within the country in which you are, or will be, employed by Sears and to continue to meet the requirements of
the applicable immigration legislation and regulations of that country; 

  

	 	(b)	That you understand and consent to the fact that in the course of employment, Sears will be required, from time to time, to collect, use and disclose personal
information in order to administer the employment relationship; 

  

	 	(c)	That you understand that any information relating to Sears policies, processes, structures, operations, customers, or other associates acquired by you in the course of,
or as a result of, your employment with Sears is confidential. Such information shall be treated as confidential, and may not be disclosed by you to any other person, firm or company without prior written authorization. Confidential information or
material includes but is not limited to financial information, plans, strategies, corporate information, and any other information deemed “confidential”, unless such information is available to the general public or in the public domain;
and 

  

	 	(d)	That you understand that Sears shall retain all rights attached to any of the work, products or results created, produced or manufactured by you arising out of or
related to your employment. Such ownership and the sole right to obtain copyright in such property shall be vested in Sears, and Sears shall be at liberty to effect and be responsible for the registration, use, disbursement and other protection of
such property as it may seem fit. 

  

	7.	GENERAL 

  

	7.1	The titles and descriptive headings of the articles of this Agreement are inserted solely for convenience, are not part of this Agreement and do not in any way limit or
amplify this Agreement. 

  

	7.2	In the event of any conflict or inconsistency between the provisions of this Agreement and the provisions of any Schedule hereto or any document herein, the provisions
of this Agreement shall prevail. 

  

	7.3	In the event that any provision, or part thereof contained in this Agreement, or any schedule of this Agreement is prohibited or declared invalid, illegal or
unenforceable by a court or other lawful authority, this Agreement and all schedules to this Agreement shall continue in force, with respect to the enforceable provisions, and all rights and remedies accrued under the enforceable provisions shall
survive any such declaration. 

  

					
	April 26, 2011	  	6	  	

	7.4	This Agreement and any schedules or documents incorporated by reference herein constitute the entire Agreement between Sears and you and supersedes all prior
negotiations and oral and written understandings, if any. 

  

	7.5	No supplement, waiver, amendment, modification or rescission of this Agreement shall be binding unless set forth in writing and signed by Sears.

  

	7.6	This Agreement shall ensure to the benefit and be binding upon each party and its heirs, executors, administrators, successors and permitted assigns.

  

	7.7	This Agreement shall be governed by and construed in accordance with the laws in force in the Province of Ontario and shall be treated in all respects as an Ontario
contract. The parties submit to the jurisdiction of the Courts of Ontario with respect to any dispute, claim or other matter arising under this Agreement and the Courts of Ontario shall have exclusive jurisdiction with respect to any such dispute,
claim or other matter. 

  

	7.8	You hereby represent and warrant that you are not party to or bound by the terms of any agreement with any previous employer or any other party that would prevent you
from performing services for Sears. You further represent and warrant to Sears that in the performance of your duties for Sears you shall not improperly bring to Sears or use any trade secrets, confidential information or other proprietary
information of any third party; and that you will not infringe the intellectual property rights of any third party. 

  

	7.9	You acknowledge that you have been given the opportunity to read, evaluate and discuss the provisions of this Agreement and the attached documents with your personal
advisors and with representatives of Sears. 

  

	7.10	In consideration of accepting this agreement from Sears, you expressly authorize Sears to deduct and withhold any documented amounts owing to Sears, including but not
limited to any vacation taken in excess of accrued entitlement, from any sums owing by Sears to you. You acknowledge that this paragraph constitutes a formula from which a specific amount may be calculated and is good and sufficient authorization
for the purposes of all applicable legislation. 

  

	7.11	You acknowledge that this agreement is conditional upon the successful completion of references, background check and verification of your educational credentials and
approval of pending work permit to legally entitle you to work in Canada. In the event that these checks do not meet Sears standards, you understand that this agreement is terminated and that you are not entitled to notice or pay in lieu of such
notice in the event of such termination of this agreement. 

 If the terms and conditions herein contained are acceptable, please
return an executed copy of this Agreement. This Agreement is open for your acceptance until 8:00 p.m. EST on April 26, 2011, at which time, if not accepted, it shall be deemed null and void. 

 

					
	SEARS CANADA INC.	 		 	
			
	

	 		 	

	 Dene Rogers
 President and
CEO
	 		 	Tom Fitzgerald

  

					
	April 26, 2011	  	7	  	

 Schedule A 
 SETTLEMENT AND RELEASE AGREEMENT 
 IN CONSIDERATION of the provision of the terms set
out in the Letter of Termination dated              and hereto attached and other good and valuable consideration, the sufficiency of which is hereby acknowledged, I,
                            , on behalf of myself, my heirs, successors, administrators and assigns
(hereinafter collectively referred to as the “Releasor”), agree to hereby release and forever discharge Sears Canada Inc., its parents, affiliates and associated companies, subsidiaries, officers, directors, employees, servants, agents and
their successors and assigns, (collectively, “Sears”) jointly and severally from any and all actions, causes of actions, contracts, covenants, whether express or implied, but not limited to, any bonus claims of any nature and kind
whatsoever, any vacation pay entitlements, claims and demands for damages, including any disability claims, loss of benefit claims, indemnity, costs, interest, loss or injury of every nature and kind whatsoever and howsoever arising, whether
statutory or otherwise and specifically including, but not limited to, any claim under the applicable Employment Standards legislation (including but not limited to claims for wages, notice, severance, vacation pay or termination pay), Human
Rights Code, Labour Relations Act, Occupational Health and Safety Act and Workplace Safety and Insurance Act, and any successor legislation, which I may heretofore have had, may now have, or may hereinafter have, in any way relating to my
engagement by, hiring by, my employment with or the cessation of my engagement/employment by Sears. 
 I AGREE not to make any claims or
demands, or commence, maintain or prosecute any action, cause or proceeding for damages, compensation, loss or any other relief whatsoever against Sears arising out of my employment with Sears or the termination of that employment. I further agree
that this Settlement and Release Agreement shall operate conclusively as an estoppel and complete bar in the event of any such claim, action or proceeding, and may be plead as such, and that I will be liable to Sears for its costs and expenses,
including reasonable legal fees, incurred in responding thereto. For clarity, I further agree that, as a condition of this Settlement and Release Agreement, I will take all necessary steps to ensure the withdrawal or dismissal of such claim or
complaint. 
 I ACKNOWLEDGE AND AGREE that I shall not make any claim or demand or take any action or proceeding in connection with any matter
covered by this Settlement and Release Agreement against any other person or corporation who might claim contribution or indemnity from Sears by virtue of the said claim or proceeding. I agree that if any such claim, demand, action or 

proceeding is made by me, Sears may raise this document as an estoppel and complete bar to any such claim, demand, action or proceeding and that I will
be liable to Sears for its costs and expenses, including reasonable legal fees, incurred in responding thereto. 
 AND FOR THE SAID
CONSIDERATION, I hereby confirm that I have considered whether I have any possible claim against Sears in respect of the applicable Human Rights Code, and confirm that I either have no such claim or that this Settlement and Release
Agreement expressly compensates me for any such claim and that I seek no further right or remedy in respect of any possible claim. 
 I AGREE
that the terms and conditions of this Settlement and Release Agreement are confidential and I undertake not to divulge or communicate its contents, in whole or in part, directly or indirectly, to anyone other than to receive professional advice.

 I AGREE that in the event I should file any legal complaint with respect to the cessation of my employment with Sears contemplated hereunder,
I will immediately reimburse Sears for any and all consideration provided pursuant to this Settlement and Release Agreement. 

  

					
	April 26, 2011	  	8	  	

 I AGREE not to, at any time, publicly comment in any adverse fashion, whether verbally or in writing, about
any Sears present or former employees, officers, or directors. 
 I ACKNOWLEDGE AND AGREE to indemnify and save harmless Sears from any and all
claims or demands under the Income Tax Act of Canada, the Income Tax Act of the applicable Province the Canada Pension Plan, the Employment Insurance Act of Canada, including any regulations made under the Employment
Insurance Act, and any other statute or regulations for or in respect of any failure on Sears to withhold income tax, Canada Pension Plan premiums, employment insurance premiums or benefit overpayments or any other tax premium, payment of levy
from all or any part of the consideration and any interest or penalties relating to the failure to withhold any costs or expenses incurred in defending such claims or demands. 
 I ACKNOWLEDGE AND AGREE that during my employment I acquired confidential information which is the exclusive property of the Sears which I shall not use in any manner without the express written
permission of Sears. I recognize that all material and information that has been disclosed to me during my employment is confidential information that could be used to the detriment of the Sears. As such, I will fulfill my obligations to hold
confidential the information I received during my employment with Sears. I acknowledge and agree that the requirement to keep confidential the information acquired by me during my employment is reasonable and necessary for the protection of Sears.

 I ACKNOWLEDGE AND AGREE that the giving of the consideration herein is not deemed to be any admission of liability on the part of Sears and,
in fact, liability is expressly denied. 
 I ACKNOWLEDGE AND AGREE that in the event that any provision of this Settlement and Release Agreement
is deemed void, invalid or unenforceable by a court of competent jurisdiction, the remaining provisions shall remain in full force and effect. 

THIS SETTLEMENT AND RELEASE AGREEMENT has been made in, and shall be construed in accordance with the laws of the Province of Ontario, and shall enure to
the benefit of, and be binding upon me and my heirs, executors, administrators, legal and personal representatives, successors, and assigns. 

I DECLARE THAT I fully understand the terms of this Settlement and Release Agreement and have had the opportunity to obtain independent legal advice
prior to executing this document, and that I have signed this document freely, voluntarily and without constraint. I voluntarily accept the consideration offered for the purpose of making full and final compromise and settlement of all claims as
noted above. 
 IN WITNESS WHEREOF I have executed this Settlement and Release Agreement at
            , 
 DATE:
                                    , 2011 SIGNED, SEALED AND
DELIVERED IN THE PRESENCE OF: 
  

					
	 	 		 	 
			
	Associate Name	 		 	WITNESS
			
	 	 		 	 
			
	Print name:	 		 	Print name:

  

  

					
	April 26, 2011	  	9	  	

 Schedule B 
 The following companies (including in each case subsidiaries controlled by the company and successors to the business of the company in Canada): 
 Hudson’s Bay Company (Hbc) (including the Zellers Inc. and Home Outfitters divisions), Canadian Tire Corporation Limited, Wal-Mart Canada Corporation, Best Buy Canada Ltd., Gap Inc. (including the
Banana Republic and Old Navy divisions), Office Depot Inc., InterTAN Canada Ltd. (currently doing business as “The Source by Circuit City”), The Home Depot Inc., Le Group RONA Inc. (RONA), Home Hardware Stores Limited, Reitmans (Canada)
Limited, Loblaw Companies Limited, Staples, The Business Depot, Ltd, Lowes, Target Corporation, Kohl’s, Shoppers Drug Mart. 

  

					
	April 26, 2011	  	10

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