S-8 POS

As filed with the Securities and Exchange Commission on August 31, 2011
Registrant No. 333-143699

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

POST EFFECTIVE AMENDMENT NO. 1

TO

FORM S-8

REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933

COLLECTIVE BRANDS, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	43-1813160
(State of Incorporation)	(I.R.S. Employer Identification No.)
3231 S.E. 6th Avenue, Topeka, Kansas	66607-2207
(Address of Principal Executive Offices)	(Zip Code)

COLLECTIVE BRANDS 401(K) PROFIT SHARING PLAN
COLLECTIVE BRANDS PUERTO RICO PROFIT SHARING PLAN
COLLECTIVE BRANDS PERFORMANCE + LIFESTYLE GROUP EMPLOYEE
SAVINGS & INVESTMENT PLAN
(Full Title of Plan)

Harold J. Herman, II
Vice President, Group Counsel and Assistant Secretary

COLLECTIVE BRANDS, INC.
3231 S.E. 6th Avenue
Topeka, Kansas 66607-2207

(785) 233-5171
(Name, Address and Telephone Number of Agent for Service)

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of the “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer þ	Accelerated filer o	Non-accelerated filer o	Smaller reporting company o
		(Do not check if a smaller reporting company)

EXPLANATORY NOTE

     On June 13, 2007, Collective Brands, Inc. (formerly Payless ShoeSource, Inc.), a Delaware corporation (the “Registrant”), registered on Form S-8 File No. 333-143699 the offering and sale of 10,000,000 shares of Registrant’s common stock, par value $.01 per share (“Common Stock”) together with attached preferred stock purchase rights and an indeterminate amount of plan interests constituting separate securities, pursuant to the Payless ShoeSource, Inc. 401(k) Plan and the Payless ShoeSource, Inc. Profit Sharing Plan for Puerto Rico Associates (renamed effective July 1, 2011 the Collective Brands 401(k) Profit Sharing Plan and the Collective Brands Puerto Rico Profit Sharing Plan, respectively). This Post Effective Amendment No. 1 to the 2007 registration statement is being filed to (i) revise the plan names of the plans listed under the 2007 registration statement (ii) add the Collective Brands Performance + Lifestyle Group Employee Savings & Investment Plan and (iii) indicate that effective October 1, 2011, the 10,000,000 shares of Common Stock (and related plan interests), the offering and sale of which are covered by the 2007 registration statement, shall include such offerings and sales under the Collective Brands 401(k) Profit Sharing Plan, the Collective Brands Puerto Rico Profit Sharing Plan and the Collective Brands Performance + Lifestyle Group Employee Savings & Investment Plan. The registration fees in respect of such shares of Common Stock were paid at the time of the filing of the 2007 registration statement.

PART I
INFORMATION REQUIRED IN THE
SECTION 10(a) PROSPECTUS

ITEM 1. PLAN INFORMATION*

ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION*

* The information required by Items 1 and 2 of part 1 of Form S-8 is omitted from this registration statement in accordance with Rule 428 under the Securities Act of 1933 and the “Note” to Part I of Form S-8.

PART II
INFORMATION REQUIRED IN THE
REGISTRATION STATEMENT

ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.

The following documents filed with the Securities and Exchange Commission (the “Commission”) are hereby incorporated by reference:

     (a) The Annual Report of Collective Brands, Inc. (the “Company” or “Registrant”) on Form 10-K (Commission File No. 1-14770) for the Fiscal Year ended January 29, 2011.

     (b) The Quarterly Report of the Registrant on Form 10-Q for the fiscal Quarters ended April 30, 2011 and July 30, 2011. (Commission File No 1-14770).

     (c) The Registrant’s Current Reports on Form 8-K filed on (i) March 2, 2011, (ii) May 18, 2011, (iii) May 24, 2011, (iv) May 26, 201, (v) June 2, 2011 (vi) June 15, 2011 (vii) June 16, 2011 (viii) June 21, 2011 (ix) June 23, 2011 (x) July 6, 2011, (xi) July 22, 2011,(xii) August 17, 2011, and (xiii) August 24, 2011.

     (d) The description of the Registrant’s Common Stock contained under the captions “New Payless Capital Stock” of the Registrant’s Registration Statement on Form S-4 (File No. 333-50577).

     (e) The description of the Rights contained under “Description of Registrant’s Securities to be Registered” contained in the Registrant’s Registration Statement on Form 8-A filed on August 24, 2011

In addition, all documents subsequently filed by the Registrant pursuant to Sections 13(a), 13(c), 14, and 15(d) of the Exchange Act and prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold, are incorporated by reference in this registration statement and are a part hereof from the date of filing of such documents. Any statement contained herein or in a document all or a portion of which is incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this registration statement to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified and amended, to constitute part of this registration statement.

ITEM 4. DESCRIPTION OF SECURITIES.

Not Applicable.

ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.

Not applicable.

ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Registrant’s Restated Certificate of Incorporation (the “Charter”) provides that it will indemnify any person who was or is a party or is threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative (including any action or suit by or in the right of Registrant) by reason of the fact that such person is or was a director, officer, employee or agent of Registrant or is or was serving at the request of Registrant as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, but in each case only if and to the extent permitted under applicable state or federal law. Expenses, including attorneys’ fees, incurred by any such person in defending any such action, suit or proceeding shall be paid or reimbursed by Registrant in advance of the final disposition of such action, suit or proceeding upon receipt by it of an undertaking of such person to repay such expenses if it shall ultimately be determined that such person is not entitled to be indemnified by Registrant.

The Charter further states that the right to indemnification and advancement of expenses provided therein shall not be deemed exclusive of any other rights to which those indemnified may be entitled, and shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, and personal representatives of such a person.

Section 145 of the Delaware General Corporation Law (“DGCL”) permits a corporation to indemnify its directors and officers against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlements actually and reasonably incurred by them in connection with any action, suit or proceeding brought by third parties, if such directors or officers acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reason to believe their conduct was unlawful. In a derivative action, i.e., one by or in the right of the corporation, indemnification may be made only for expenses actually and reasonably incurred by directors and officers in connection with the defense or settlement of an action or suit, and only with respect to a matter as to which they shall have acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made if such person shall have been adjudged liable to the corporation, unless and only to the extent that the court in which the action or suit was brought shall determine upon application that the defendant, officers or directors are fairly and reasonably entitled to indemnity for such expenses despite such adjudication of liability.

As permitted by Section 102(b) (7) of the DGCL, the Charter provides that no director of Registrant will be liable to Registrant or its shareowners for monetary damages for breach of fiduciary duty as a director, except for liability (1) for any breach of the director’s duty of loyalty to Registrant or its shareowners; (2) for acts or omissions not in good faith or which involve intentional misconduct or knowing violation of the law; (3) under Section 174 of the DGCL; or (4) for any transaction from which a director derived an improper benefit.

Registrant has entered into indemnification agreements with each director and certain executive officers of Registrant. Generally, each indemnification agreement provides, among other things, (i) for indemnification to the fullest extent permitted by law against all expenses, judgments, fines, penalties incurred in connection with, and amounts paid in settlement of, any claim against the indemnified party, provided it is determined pursuant to the agreement that the indemnitee is entitled to be indemnified under the applicable standard of conduct under the DGCL; (ii) for advancement of expenses to the indemnitee in connection with the indemnitee’s defense of any threatened or pending claim, provided that if it is determined pursuant to the agreement that the indemnitee would not be permitted to be indemnified under applicable law, Registrant shall be entitled to be reimbursed by the indemnitee for all such amounts previously paid; (iii) for the creation of a trust for the benefit of the indemnitee in the event of a potential change in control of Registrant which shall be funded from time to time at the request of the indemnitee in an amount sufficient to satisfy Registrant’s indemnification obligations under the agreement; and (iv) that no legal action be brought and no cause of action be asserted by or on behalf of Registrant against the indemnitee after the expiration of the earlier of the applicable statute of limitations or two years after the date of accrual of such cause of action. Similar indemnification agreements may be entered into from time to time with additional officers of Registrant. In addition, Registrant has purchased a directors and officers liability insurance policy.

ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.

Not applicable.

ITEM 8. EXHIBITS.

4.1	Collective Brands 401(k) Profit Sharing Plan, as amended and restated effective August 15, 2011*
4.2	Collective Brands Performance + Lifestyle Group Employee Savings & Investment Plan, as amended and restated effective October 1, 2011*
4.3	Collective Brands Puerto Rico Profit Sharing Plan as Amended Effective January 1, 2007, or as otherwise specified*
4.4	Amendment to the Collective Brands Puerto Rico Profit Sharing Plan effective September 1, 2011*
23.1	Consent of Deloitte & Touche LLP.*

* Filed Herewith

ITEM 9. UNDERTAKINGS.

     (a) The Registrant hereby undertakes:

     (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

     (i) to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

     (ii) to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement and;

     (iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the Registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this registration statement;

     (2) That, for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

     (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

     (b) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

     (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers, and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer, or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Topeka, State of Kansas, on the 31^st day of August, 2011.

COLLECTIVE BRANDS, INC.
By:	/s/ Douglas G. Boessen
	Name:	Douglas G. Boessen
	Title:	Division Senior Vice President, Chief Financial Officer

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed below by the following persons in the capacities and on the dates indicated:

By:	/s/ Michael J. Massey	Date: August 31, 2011
	Michael J. Massey
	Chief Executive Officer & President (Principal Executive Officer)
By:	/s/ Douglas G. Boessen	Date: August 31, 2011
	Douglas G. Boessen
	Division Senior Vice President, Chief Financial Officer (Principal Financial and Accounting Officer)
By:	/s/ D. Scott Olivet	Date: August 31, 2011
	D. Scott Olivet
	Chairman of the Board and Director
By:	/s/ Daniel Boggan Jr.	Date: August 31, 2011
	Daniel Boggan Jr.
	Director
By:	/s/ Mylle H. Mangum	Date: August 31, 2011
	Mylle H. Mangum
	Director
By:	/s/ John F. McGovern	Date: August 31, 2011
	John F. McGovern
	Director
By:	/s/ Robert F. Moran	Date: August 31, 2011
	Robert F. Moran
	Director
By:	/s/ Richard L. Markee	Date: August 31, 2011
	Richard L. Markee
	Director
By:	/s/ Matt Ouimet	Date: August 31, 2011
	Matt Ouimet
	Director
By:	/s/ Michael A. Weiss	Date August 31, 2011
	Michael A. Weiss
	Director
By:	/s/ Robert C. Wheeler	Date: August 31, 2011
	Robert C. Wheeler
	Director

The Plan. Pursuant to the requirements of the Act, the Administrative Committee of the Plans has duly caused this Post-Effective Amendment No. 1 to be signed on its behalf by the undersigned thereunto duly authorized, in the City of Topeka, State of Kansas, on the 31^st day of August, 2011.

COLLECTIVE BRANDS 401(K) PROFIT SHARING PLAN

By:	/s/ Betty J. Click
	Betty Click
	Senior Vice President

COLLECTIVE BRANDS PUERTO RICO PROFIT SHARING PLAN

By:	/s/ Sally J. Burk
	Sally Burk
	Vice President

COLLECTIVE BRANDS PERFORMANCE + LIFESTYLE GROUP EMPLOYEE SAVINGS & INVESTMENT PLAN

By:	/s/ Sally J. Burk
	Sally Burk
	Vice President

EXHIBIT INDEX

4.1	Collective Brands 401(k) Profit Sharing Plan, as amended and restated effective August 15, 2011*
4.2	Collective Brands Performance + Lifestyle Group Employee Savings & Investment Plan, as amended and restated effective October 1, 2011*
4.3	Collective Brands Puerto Rico Profit Sharing Plan, as Amended Effective January 1, 2007, or as otherwise specified*
4.4	Amendment to the Collective Brands Puerto Rico Profit Sharing Plan effective September 1, 2011*
23.1	Consent of Deloitte & Touche LLP.*

* Filed Herewith

EX-4.1

Exhibit 4.1

COLLECTIVE BRANDS 401(k)
PROFIT SHARING PLAN

As Amended and Restated Effective August 15, 2011, or as otherwise specified

TABLE OF CONTENTS

	PAGE
SECTION 1 Definitions		2
1.01 Accounts		2
1.02 Administrative Delegate		2
1.03 After-Tax Contributions		2
1.04 Allocation Pay Amount		2
1.05 Associate		2
1.06 Authorized Leave of Absence		3
1.07 Before-Tax Contributions		3
1.08 Beneficiary		3
1.09 Board		3
1.10 Code		3
1.11 Committee		3
1.12 Company		3
1.13 Company Accounts		3
1.14 Company Matching Contributions		3
1.15 Company Profit Sharing Contributions		3
1.16 Effective Date		3
1.17 Employer		3
1.18 ERISA		3
1.19 Fiduciary		4
1.20 Fiscal Year		4
1.21 Group		4
1.22 Highly Compensated Employee		4
1.23 Hour of Service		4
1.24 Investment Fund		5
1.25 May Plan		5
1.26 Member		5
1.27 Member Accounts		5
1.28 Member After-Tax Accounts		5
1.29 Member Before-Tax Accounts		5
1.30 Member Contributions		5
1.31 Member Rollover Contribution Accounts		5
1.32 Military Service		5
1.33 Net Profits		5
1.34 Non-Highly Compensated Employee		6
1.35 Pay		6
1.36 Pooled Investment Account		6
1.37 Plan		6
1.38 Plan Year		6
1.39 Prior Plan		6
1.40 Qualified Domestic Relations Order		6
1.41 Retirement		7
1.42 Rollover Contributions		7

i

	PAGE
1.43 Social Security Wage Base		7
1.44 Total and Permanent Disability or Disability		7
1.45 Transferred Accounts		7
1.46 Trust Agreement		7
1.47 Trust Fund		7
1.48 Trustee		7
1.49 Unit		7
1.50 Unit Value		7
1.51 Valuation Date		7
1.52 Vesting Service		7
1.53 Year of Service		9
SECTION 2 Membership		10
2.01 Conditions of Eligibility		10
2.02 Re-Employment		11
SECTION 3 Company Contributions		12
3.01 Amount of Company Profit Sharing Contribution		12
3.02 Amount of Company Matching Contribution		12
3.03 Allocation of Company Contributions		12
3.04 Profit Sharing Allocation Formula		13
3.05 Investment of the Company Contribution		13
3.06 Return of Company Contributions		13
SECTION 4 Member Contributions		14
4.01 Procedure for Making Contributions		14
4.02 Limitations On And Distributions Of Before-Tax Contributions For Highly Compensated Employees		16
4.03 Distributions of Excess Deferrals		17
4.04 Limitations On And Distributions Of After-Tax Employee Contributions And Matching Contributions For Highly Compensated Employees		18
4.05 Definitions and Special Rules		19
SECTION 5 Investment Provisions		21
5.01 Investment Funds		21
5.02 Investment Direction		21
SECTION 6 Accounts		23
6.01 Member Accounts		23
6.02 Company Accounts		23
6.03 Maintenance of Accounts		23
6.04 Valuation of Accounts		23
6.05 Member Statements		23
6.06 Shares of Collective Brands, Inc. (“Collective Brands Stock”) in the Collective Brands Common Stock Fund		23
6.07 Vesting in Member and Company Accounts		24

ii

	PAGE
SECTION 7 Expenses		28
7.01 Administrative Expenses		28
SECTION 8 Withdrawals During Employment		29
8.01 Withdrawals Prohibited Unless Specifically Authorized		29
8.02 Authorized Withdrawals		29
SECTION 9 Benefits Upon Retirement, Death, Disability or Termination of Employment		32
9.01 Benefits		32
9.02 Beneficiary		32
SECTION 10 Payment of Benefits		33
10.01 Time of Payment		33
10.02 Form of Payment		34
10.03 Indirect Payment of Benefits		34
10.04 Inability to Find Member		34
10.05 Required Minimum Distributions		34
10.06 Commencement of Benefit Distribution to Beneficiary		38
10.07 Commencement of Benefit Distribution to Alternate Payee		38
SECTION 11 Permitted Rollover of Plan Distributions		39
11.01 Rollover to Other Plans		39
11.02 Rollover from Other Plans		39
11.03 Definitions		40
SECTION 12 Loans		41
12.01 Availability of Loans		41
12.02 Amount of Loans		41
12.03 Terms of Loans		41
SECTION 13 Limit on Contributions to the Plan		43
13.01 Limit on Contributions		43
13.02 Adjustment for Excessive Annual Additions		44
SECTION 14 Administration of the Plan		45
14.01 Plan Administrator		45
14.02 Delegation of Authority		45
14.03 Committee and Subcommittees		45
14.04 Accounts and Reports		46
14.05 Non-Discrimination		47
SECTION 15 Management of the Trust Fund		48
15.01 Use of the Trust Fund		48
15.02 Trustees		48
15.03 Investments and Reinvestments		48
SECTION 16 Certain Rights and Obligations of Employers and Members		50
16.01 Disclaimer of Employer Liability		50

iii

	PAGE
16.02 Employer-Associate Relationship		50
16.03 Binding Effect		50
16.04 Corporate Action		50
16.05 Claim and Appeal Procedure		50
16.06 Venue for Litigation		53
16.07 Acquisition Of Assets		53
SECTION 17 Non-Alienation of Benefits		54
17.01 Provisions with Respect to Assignment and Levy		54
17.02 Alternate Application		54
SECTION 18 Amendments		55
18.01 Company’s Rights		55
18.02 Procedure to Amend		55
18.03 Provision Against Diversion		55
SECTION 19 Termination		56
19.01 Right to Terminate		56
19.02 Withdrawal of an Employer		56
19.03 Distribution in Event of Termination of Trust		56
19.04 Administration in Event of Continuance of Trust		56
19.05 Merger, Consolidation or Transfer		56
SECTION 20 Construction		57
20.01 Applicable Law		57
20.02 Gender and Number		57
SECTION 21 Top-Heavy Requirements		58
21.01 Generally		58
21.02 Minimum Allocations		58
21.03 Determination of Top Heaviness		58
21.04 Calculation of Top-Heavy Ratios		59
21.05 Cumulative Accounts and Cumulative Accrued Benefits		59
21.06 Other Definitions		60

iv

COLLECTIVE BRANDS
401(k) PROFIT SHARING PLAN

INTRODUCTION

     Effective April 1, 1996, Payless ShoeSource, Inc. withdrew from and ceased to be a participating Employer in The May Department Stores Company Profit Sharing Plan (the “May Plan”), and established the Payless ShoeSource, Inc. Profit Sharing Plan (the “Plan”). Effective January 1, 1997, a portion of the Plan covering Associates of Payless ShoeSource of Puerto Rico, Inc. was spun off. As of August 1, 1997, Payless amended and restated the Plan, primarily to establish a company matching contribution based on Members’ contributions effective January 1, 1998, to institute automatic enrollment in before-tax contributions by Members, and to comply with certain changes in the law. On June 1, 1998, Payless restructured its corporate organization into a holding company structure with Payless ShoeSource, Inc., a Delaware corporation, as the parent corporation and the named Company for this Plan. Effective March 20, 2000, the Company amended and restated the Plan, primarily to include provisions for loans and the acceptance of rollover contributions from other qualified plans, a change to daily valuation and other miscellaneous changes.

     Effective January 1, 2002, the Company amended and restated the Plan to effect the adoption of mandatory and certain permissive provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 (“EGTRRA”). The EGTRRA amendments to the Plan are intended to be made in good faith compliance with the requirements of EGTRRA and are to be construed in accordance with EGTRRA and guidance issued thereunder. While the EGTRRA amendments are generally effective January 1, 2002, some of the amendments are effective May 1, 2002, as indicated below. In addition, effective May 1, 2002, the Plan was amended to permit Full-Time Associates to participate in the Plan upon the completion of 90 days of employment service with a participating Employer or other member of the Group. Effective January 1, 2003 the Company again amended and restated the Plan to reflect the terms of the final Treasury Regulations governing required minimum distributions. Effective March 28, 2005, the Company amended the Plan to reduce the limit for certain mandatory distributions as described in IRS notice 2005-5. Other amendments made herein are effective on the dates as specified. The Plan was further amended as specified to provide for a guaranteed minimum Company Matching Contribution. Additional amendments were made effective January 1, 2006 to permit Full-Time Associates to make elective contributions to the Plan after completing 60 days of employment and to be eligible to receive the Company Matching Contribution after completing 180 days of employment. The hardship provisions of the Plan were also amended to expand the definition of a “hardship”, consistent with Treasury regulations. The Plan was further amended effective January 1, 2007 to provide for Part-Time Associates to be eligible to participate in the Plan upon turning age 21 and completing a full year of employment and to remove the re-employment provision specified under Section 2.02.

     The Plan is amended as of the dates indicated herein to change the eligibility requirements to participate, change the definition of vesting service, and permit the plan administrator to limit the future contributions a participant may invest in the company stock fund; and effective August 15, 2011, the Plan is restated in its entirety to read as follows:

1

SECTION 1

Definitions

     1.01 Accounts means the Company Accounts and Member Accounts established under Section 6.

     1.02 Administrative Delegate means one or more persons or institutions to which the Committee has delegated certain administrative functions pursuant to a written agreement.

     1.03 After-Tax Contributions means Member Contributions which are not Before-Tax Contributions and which are made by the Member in accordance with Section 4.01(a).

     1.04 Allocation Pay Amount means with respect to each eligible Member, (a) one (1) times the amount of Pay as defined in Section 1.35 up to the Social Security Wage Base (“SSWB”) for the Plan Year, plus (b) two (2) times the amount of such Pay in excess of the SSWB for the Plan Year. Notwithstanding any provision of this Section 1.04 or of Section 3.04 to the contrary, in no event shall the percentage of Members’ Pay to be allocated for any year below the SSWB be less than fifty percent (50%) of the percentage of Pay allocated with respect to Members’ Pay in excess of the SSWB, nor may the latter percentage of Pay (above the SSWB) exceed the former percentage of Pay (below the SSWB) by more than 5.7% (or such other percentage as may be the maximum permitted differential under Code Section 401(1) from time to time).

     In determining each eligible Member’s Allocation Pay Amount, only Pay received during the part of the Plan Year the Member is eligible for the Company Contribution feature of the Plan, pursuant to Section 2, shall be considered, and the SSWB to be applied for such Member shall be proportionally prorated if such eligibility is for less than a full Plan Year.

     Notwithstanding the foregoing, with respect to any Plan Year for which applying the definition of Allocation Pay Amount set forth above would cause the allocation made pursuant to Section 3.04 to violate the permitted disparity limitations of Treas. Reg. Section 1.401(l)-2, Allocation Pay Amount shall be adjusted to permit Section 3.04 to operate in compliance with the limitations of Treas. Reg. Section 1.401(l)-2.

     1.05 Associate means any person who is classified as an employee by an Employer and who receives Pay from an Employer. The term Associate also may include, based upon the express written determination of the Company or the Committee, a U.S. citizen employed, at the request of the Company, by a member of the Group (defined in Section 1.21) to the extent such employee otherwise qualifies for membership under Section 2, in which case such Group member shall be deemed to be an “Employer” hereunder, as to such person or persons only. The term “Associate” shall not include (i) any person covered under a collective bargaining agreement unless and until the Employer and the collective bargaining representatives so agree, (ii) any non-resident alien, and (iii) any “Leased Employee” (as defined in Code Section 414(n), without regard to Section 414(n)(2)(B)).

2

     1.06 Authorized Leave of Absence means any leave of absence authorized by the Employer under rules established by the Employer.

     1.07 Before-Tax Contributions means contributions which the Member elects (in accordance with Section 4.01(b)) to have the Employer make directly to the Plan on behalf of the Member, which election shall constitute an election under Code Section 401(k)(2)(A). The “Member’s Before-Tax Contributions” shall refer to Before-Tax Contributions made to the Plan by the Employer on behalf of the Member.

     1.08 Beneficiary means the person or persons entitled under Section 9.02 to receive any payments payable under this Plan on account of a Member’s death.

     1.09 Board means the Board of Directors of the Company.

     1.10 Code means the Internal Revenue Code of 1986, as amended from time to time.

     1.11 Committee means the Collective Brands Retirement and Investment Committee comprised of three or more members as determined and appointed from time to time by the Board.

     1.12 Company means Collective Brands, Inc., a Delaware corporation, and any other organization which may be a successor to it.

     1.13 Company Accounts means accounts reflecting the portion of each Member’s interest in the Investment Funds which are attributable to Company Matching Contributions (“Company Matching Accounts”) and to Company Profit Sharing Contributions (“Company Profit Sharing Accounts”) and to any contributions made by an Employer under prior plans, as well as to any income and/or earnings attributable to such Company Contributions and prior plan contributions.

     1.14 Company Matching Contributions means contributions made by the Company or an Employer, based on a Member’s Before-Tax and/or After-Tax Contributions, pursuant to Section 3.02.

     1.15 Company Profit Sharing Contributions means discretionary contributions made by the Company or an Employer, based on Net Profits, pursuant to Section 3.01.

     1.16 Effective Date originally meant April 1, 1996. However, the effective date of this amendment and restatement of the Plan shall be August 15, 2011, unless otherwise specified herein.

     1.17 Employer means the Company and, if authorized by the Company to participate herein, any subsidiary of the Company or any affiliated corporation, partnership or sole proprietorship which elects to participate herein.

     1.18 ERISA means the Employee Retirement Income Security Act of 1974, as amended from time to time.

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     1.19 Fiduciary means the Employer, the Trustee, each of the members of the Committee described in Section 14, and any investment manager designated pursuant to Section 15.

     1.20 Fiscal Year means the Company’s Fiscal Year.

     1.21 Group means the Company and any other company which is related to the Company as a member of a controlled group of corporations in accordance with Code Section 414(b), as a trade or business under common control in accordance with Code Section 414(c) or as an affiliated service group in accordance with Code Section 414(m) or the regulations under Code Section 414(o). For the purposes of the Plan, for determining whether or not a person is an employee of the Group and the period of employment of such person, each such other company shall be included in the “Group” only for such period or periods during which such other company is a member with the Company of a controlled group or under common control.

     1.22 Highly Compensated Employee means any Member who (a) was a “five percent owner” as defined in Section 21.06(f)(2) at any time during either the determination year or the look-back year; or (b) received compensation within the meaning of Code Section 415(c)(3) (including the deferrals described in Code Section 415(c)(3)(D)) from the Employer in excess of $110,000 (as adjusted pursuant to Code Section 415(d)) during the look-back year. For purposes of this Section 1.22, compensation within the meaning of Code Section 415(c)(3) shall mean the remuneration as defined in Section 13.01(a).

     For purposes of this Section, the determination year shall be the Plan Year, and the look-back year shall be the 12-month period immediately preceding the determination year. The determination of who is a Highly Compensated Employee, including the determination of the compensation that is considered, will be made in accordance with Code Section 414(q) and the regulations thereunder.

     1.23 Hour of Service means any hour for which an Associate (including a leased employee) is directly or indirectly compensated, or entitled to compensation, by the Employer or by any member of the Group, whether or not such Group member has adopted the Plan, for any of the following:

(a) the performance of duties during the applicable computation period;

(b) a period during which no duties are performed (irrespective of whether the employment relationship has terminated) due to vacation, holiday, illness, incapacity (including disability), layoff, jury duty, Military Service, or Authorized Leave of Absence;

(c) a period for which back pay is awarded or agreed to, provided that no Hour of Service has been credited under subsection (a) or (b) with respect to the same period.

     Hours of Service and applicable computation periods shall be determined in accordance with the requirements of 29 C.F.R. Section 2530.200b.

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     1.24 Investment Fund means any fund for investment of contributions as described in Section 5.01.

     1.25 May Plan means The May Department Stores Company Profit Sharing Plan.

     1.26 Member means any person included in the membership of this Plan as provided in Section 2. A person shall cease to be a Member when he

     (i) has ceased to be employed by the Employer, and

     (ii) has no undistributed account balances under the Plan.

     1.27 Member Accounts means the Member Before-Tax Accounts, the Member After-Tax Accounts and the Member Rollover Contribution Accounts. To the extent an Associate makes a Rollover Contribution pursuant to Section 11.02 and the Associate is otherwise eligible but has not yet completed the participation requirements of Section 2.01, such contribution shall also be a Member Account.

     1.28 Member After-Tax Accounts means the Member Accounts with respect to a Member’s After-Tax Contributions.

     1.29 Member Before-Tax Accounts means the Member Accounts with respect to a Member’s Before-Tax Contributions.

     1.30 Member Contributions means the Member’s Before-Tax Contributions and After-Tax Contributions.

     1.31 Member Rollover Contribution Accounts means the Member Accounts with respect to an Associate’s or Member’s Rollover Contributions.

     1.32 Military Service means effective December 13, 1996, any period of obligatory military service with the Armed Forces of the United States of America, or voluntary service in lieu of such obligatory service, provided that the Associate returns to active employment with the Employer within the period during which the Employer would be required to re-employ the Associate under Federal law. Notwithstanding any provision of this Plan to the contrary, contributions, benefits, loan repayment and service credit with respect to qualified Military Service will be provided in accordance with Code Section 414(u).

     1.33 Net Profits means the consolidated net profits of the Company for any given Fiscal Year, determined by generally accepted accounting principles except that (i) no deduction or provision shall be made for any federal, state or other taxes measured by net income, nor for any contributions to the Trust or to any other pension or profit sharing plan, and (ii) there shall be excluded any proceeds from life insurance of which the Company is beneficiary (whether paid in a single sum or otherwise) and any gains or losses on the sale of capital assets. Such term shall also mean any accumulated and undistributed Net Profits (as defined in the preceding sentence) earned in prior Fiscal Years to the extent that such accumulated and undistributed Net Profits constitute surplus of the Company and its subsidiaries available for contributions hereunder.

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     1.34 Non-Highly Compensated Employee means any Employee who is not a Highly Compensated Employee but who is eligible to participate in the Plan.

     1.35 Pay means the aggregate of (i) all regular pay, commissions, overtime pay, cash incentives, prizes and cash awards, plus (ii) amounts which the Associate elects to have the Employer contribute directly to the Plan on the Associate’s behalf in accordance with Section 4.01(b). Pay shall include any amounts not otherwise includable in the Member’s taxable income pursuant to Code Section 125. Pay shall not include amounts for a pension, a retirement allowance, a retainer or a fee under contract, deferred compensation (including amounts deferred under the Deferred Compensation Plan of The May Department Stores Company and the Deferred Compensation Plan of Payless ShoeSource, Inc.), severance pay, distributions from this Plan, amounts earned before an individual becomes a Member, or items of extraordinary income including but not limited to amounts resulting from the exercise of stock options, spinoff cash, spinoff stock and restricted stock awards. Pay in excess of $245,000 shall be disregarded, although such amount shall be adjusted for cost-of-living increases in accordance with Code Section 401(a)(17)(B).

     Pay shall not include any compensation paid after an individual’s termination of employment. Notwithstanding the preceding, to the extent that the following amounts are otherwise included in the definition of Pay and are paid no later than the later of the date which is 2¹/2 months after termination of employment or the end of the Plan Year that includes the date of termination of employment, such amounts paid after an Associate’s termination of employment shall be deemed Pay: regular pay, including compensation for services during regular working hours, overtime, shift differential, commissions, bonuses or other similar payments, and payment for unused accrued sick, vacation or other leave, but only if the Associate would have been able to use the leave if employment had continued. The rules described in this Section 1.35 with respect to post-employment payments shall not apply to payments to an individual who does not currently perform services for the Employer by reason of qualified military service, to the extent such payments do not exceed the compensation such individual would have received from the Employer if he or she had continued to perform services for the Employer.

     1.36 Pooled Investment Account means an account established pursuant to an administrative services agreement between the Company and the Trustee.

     1.37 Plan means this Collective Brands 401(k) Profit Sharing Plan.

     1.38 Plan Year means a calendar year ending each December 31.

     1.39 Prior Plan means either The May Department Stores Company Profit Sharing Plan, the Volume Shoe Corporation Profit Sharing Plan, or such other qualified plan as may be so designated by the Committee.

     1.40 Qualified Domestic Relations Order means a “qualified domestic relations order” as that term is defined in Code Section 414(p), provided that such order was entered on or after January 1, 1985.

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     1.41 Retirement means a Member’s termination of employment on or after age 55 and after completing at least five (5) Years of Service or attaining the fifth anniversary of participation, as of which date the Member’s benefit shall be nonforfeitable.

     1.42 Rollover Contributions means contributions which the Associate or Member, as applicable, elects to make in accordance with Section 11.02.

     1.43 Social Security Wage Base means, with respect to each Plan Year, the maximum amount of wages which are subject to tax in such year under the Federal Old Age, Survivors and Disability Insurance System.

     1.44 Total and Permanent Disability or Disability means the qualification for disability under Title 11 of the Federal Social Security Act.

     1.45 Transferred Accounts means Member and Company Accounts transferred from the May Plan or as applicable, the Collective Licensing International LLC 401(k) Plan (the “CLI Plan”).

     1.46 Trust Agreement means the agreement or agreements provided for in Section 15 as amended from time to time.

     1.47 Trust Fund means all the assets of the Investment Funds and any other assets which are held in one or more trusts by the Trustee or Trustees for the purposes of this Plan.

     1.48 Trustee means the corporation(s), person or persons which may at any time be acting as Trustee or Trustees under the Trust Agreement.

     1.49 Unit means one of the units representing an interest in an Investment Fund as provided in Section 6.03.

     1.50 Unit Value means the value of each Unit in an Investment Fund as of the Valuation Date as determined pursuant to Section 6.04.

     1.51 Valuation Date means any day that the New York Stock Exchange is open for business or any other date chosen by the Committee. Prior to March 31, 2000, Valuation Date means the last business day of each calendar month and any other date chosen to perform a valuation.

     1.52 Vesting Service for purposes of determining a Member’s vested interest under Section 6.07 prior to January 1, 2012 is based on “elapsed time” and is to be determined in accordance with the following definitions:

(a) “Employment Commencement Date” means the date upon which an Associate first performs an Hour of Service.

(b) “Hour of Service” means an hour for which an Associate is paid or entitled to payment for the performance of duties for the Employer or any other member of the Group.

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(c) “Period of Service” means a period beginning on the Associate’s Employment Commencement Date (or Reemployment Commencement Date, as the case may be) and ending on his Severance from Service Date.

(d) “Severance from Service Date” means the earlier to occur of:

(i) the last date upon which an Associate terminates employment with the Employer or any other member of the Group (either voluntarily or involuntarily), retires or dies; or

(ii) the first anniversary of the date upon which the Associate was first absent from service with the Employer (with or without pay) for any other reason (i.e., vacation, sickness, disability, leave of absence or layoff).

     Notwithstanding the foregoing, the Severance from Service Date of an Associate who is absent from service with the Employer beyond the first anniversary of the first day of such absence on account of maternity or paternity (as described in Code Sections 410(a)(5)(E) or 411(a)(6)(E)) shall be the second anniversary of the first day of such absence; and the period of time between such first and second anniversaries shall not be treated as a Period of Service or as a Period of Severance.

(e) “Period of Severance” means a period beginning on an Associate’s Severance from Service Date and ending upon the Associate’s Reemployment Commencement Date.

(f) “Reemployment Commencement Date” means the first date, following a Severance from Service Date, upon which the Associate performs an Hour of Service for the Employer or any other member of the Group.

(g) “Service Spanning Rules.” In determining whether or not an Associate has completed a twelve month Period of Service for purposes of vesting, the following Periods of Severance shall be treated as Periods of Service:

(i) If an Associate terminates employment with the Employer (either voluntarily or involuntarily) or retires, and then performs an Hour of Service within the twelve month period beginning on the Severance from Service Date, such Period of Severance shall be treated as a Period of Service; and

(ii) If an Associate terminates employment with the Employer (either voluntarily or involuntarily) or retires during an absence from service of twelve months or less for any reason other than a termination or retirement, and then performs an Hour of Service within a period of twelve months from the date the Employee was first absent from service, the Period of Severance shall be treated as a Period of Service.

     Effective with respect to each Associate who performs an Hour of Service on or after January 1, 2012, subject to Section 6.07(c), an Associate shall accrue one year of Vesting

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Service for each Plan Year on or after January 1, 2012, during which he completes 1,000 Hours of Service.

     1.53 Year of Service for purposes of determining eligibility under Section 2 means a year of employment during which the Associate has been paid for not less than 1,000 Hours of Service for an Employer or any other member of the Group. An Associate shall be credited with a year of employment on each anniversary date of his commencement of employment with an Employer during which he earns not less than 1,000 Hours of Service for an Employer or any other member of the Group. Periods of temporary illness, temporary layoff, Military Service, and Authorized Leaves of Absence shall not be deemed as breaking continuity of employment and shall be counted in determining Years of Service. The term “Year of Service” shall also include an employment year during which, except to the extent otherwise provided in Treasury Regulations, a “leased employee” within the meaning of Code Section 414(n) has been paid for not less than 1,000 Hours of Service for the Employer even though during such period the leased employee was not an Associate as defined in Section 1.05. The term “Year of Service” shall include any period required to be included by the Family and Medical Leave Act of 1993.

     The extent to which service with another organization, part or all of whose business operations are acquired by the Company (or by an Employer), shall be credited as “Years of Service” hereunder or as “Vesting Service” under Section 1.52 shall be determined by the Company or by the Committee on a case-by-case basis.

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SECTION 2

Membership

     2.01 Conditions of Eligibility.

(a) Each Associate who on August 14, 2011 was a Member of or is eligible to be a Member of the Plan shall continue to be a Member of this Plan entitled to make Member Contributions pursuant to Section 4 and eligible to share in Company Contributions pursuant to Section 3.

(b) On and after August 15, 2011, each other Associate shall be eligible to become a Member of the Plan when the Associate attains age 21 and meets such other eligibility criteria for Part-Time and Full-Time Associates as set forth below. Once determined eligible, membership commences as of the first day of the month coincident with or following the date the Associate has met the applicable eligibility requirements. Such Associate shall be eligible:

(i) to make Member Contributions pursuant to Section 4;

(ii) to share in Company Matching Contributions pursuant to Section 3.02;

(iii) to share in Company Profit Sharing Contributions, if any, pursuant to Section 3.01.

     Effective January 1, 2006, a Full-Time Associate shall be eligible to make Member Contributions pursuant to Section 4 as of the first day of the month coincident with or following the date he has completed 60 days of employment with the Employer and attained age 21. Further, a Full-Time Associate shall be eligible to receive a Company Matching Contribution coincident with or following the date he has completed 180 days of service with the Company and satisfied the requirements of Section 3.03. For the purposes of the preceding sentence, a “Full-Time Associate” is an Associate classified on the Employer’s records as a Full-Time Associate. In many locations, this means the Associate is normally scheduled to work 32 or more hours per week. However, the Associate’s classification on the Employer’s records, and not the actual number of hours worked in any period, determines Full-Time status. Effective January 1, 2007, a Part-Time Associate shall be eligible to make Member Contributions pursuant to Section 4 as of the first day of the month coincident with or following the date he has completed one full year of employment. Prior to the effective date of January 1, 2007, Part-Time Associates must have completed one full Year of Service to be eligible to make Member Contributions.

     Effective August 15, 2011, a Full-Time Associate or Part-Time Associate shall be eligible to make Member Contributions pursuant to Section 4 as of the first day of the month coincident with or following the date he becomes an Associate and has attained age 21. In addition, a Full-Time Associate or Part-Time Associate shall be eligible to

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receive a Company Matching Contribution if he satisfies the requirements of Section 3.03.

(c) After a Member’s latest employment or reemployment as an Associate, he shall be deemed to have elected to make a three percent (3%) Before-Tax Contribution pursuant to Section 4.01(b), commencing with the first paycheck issued with respect to the first payroll period beginning on or after the first day of the month coincident with or following the date the Employer determines he met the foregoing eligibility requirements and, effective August 15, 2011, the date he has completed 180 days of such employment and attained age 21. Notwithstanding this “deemed” election, an Associate or Member may elect pursuant to procedures established by the Committee to not make, or to suspend making, said three percent (3%) automatic Before-Tax Contribution, or pursuant to Section 4.01(a) or 4.01(b) to make an After-Tax or a Before-Tax Contribution of an amount other than three percent (3%).

(d) Associates employed by the Company’s Puerto Rican Subsidiaries are not eligible for membership hereunder. If any such Associate has Accounts in this Plan, such Accounts shall continue to be revalued as of each succeeding Valuation Date pursuant to Section 6.04.

(e) Notwithstanding any other provisions of the Plan, any individual who is providing services to the Employer in the capacity of, or who is designated by the Employer as an independent contractor, and who is subsequently reclassified as an Associate by court or similar action (whether retroactively or prospectively), shall not be eligible to participate in the Plan, and shall be treated as a member of an excluded class. No such excluded individual shall have any claim for benefits under the Plan for any period during which he is excluded from participation.

     2.02 Re-Employment. A former or inactive Member who is reemployed by the Employer after his prior termination of employment must satisfy the eligibility requirements in Section 2.01 in order to become a Member of the Plan again.

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SECTION 3

Company Contributions

     3.01 Amount of Company Profit Sharing Contribution. The Company or an Employer may contribute to the Trust, as of the end of each Plan Year, a percentage of the Company’s Net Profits as a Company Profit Sharing Contribution. The amount of such contribution, if any, shall be determined by the Board of Directors in its discretion. Any such contribution shall be made as soon as practicable after the close of the Company’s Fiscal Year. All such contributions advanced to the Plan by the Company shall be reimbursed to the Company by the Employer. Notwithstanding the above, prior to January 1, 2009, the amount of any “non-elective contribution” the Company or an Employer determines to contribute for plan year 2008 may be contributed to the Trust as of January 1, 2009 or as soon as practicable after the close of the Company’s Fiscal Year. For this purpose, the term “non-elective contribution” shall have such meaning as set forth in the CLI Plan in effect on December 31, 2008. Eligibility for such “non-elective contribution” shall be determined based upon the rules in effect under the CLI Plan on December 31, 2008.

     3.02 Amount of Company Matching Contribution. The Company shall, in its sole and absolute discretion, contribute to the Trust, as of the end of each Plan Year, a total combined amount as to this Plan and the Payless ShoeSource, Inc. Profit Sharing Plan for Puerto Rico Associates (“Puerto Rico Plan”) equaling up to 2¹/2% of its Net Profits, in the form of a Company Matching Contribution. Such Company Matching Contributions may be made by an Employer, rather than by the Company, as to that Employer’s participating Associates. The total amount of such contribution shall be allocated in proportion to the amount that each Member’s Contributions under Sections 4.01(a) and 4.01(b) for such Plan Year, up to a total of 5% of such Member’s Pay for such Plan Year, bears to the total amount of all Member Contributions up to 5% of such Members’ Pay for such Plan Year. Such Company Matching Contribution shall be determined and paid to the Trustee as soon as practicable after the close of each Fiscal Year. Notwithstanding the above, prior to January 1, 2009, the amount of any “employer matching contribution” the Company or an Employer determines to contribute for Plan Year 2008 for any Member who was employed by Collective Licensing International LLC as of December 31, 2008, may be contributed to the Trust as of January 1, 2009 or as soon as practicable after the close of the Company’s Fiscal Year. For this purpose, the term “employer matching contribution” shall have such meaning as set forth in the Collective Licensing International LLC 401(k) Plan (“CLI Plan”) in effect on December 31, 2008. Eligibility for such “employer matching contribution” shall be determined based upon the rules in effect under the CLI Plan on December 31, 2008. Notwithstanding any of the above, for Plan Year 2009, and pursuant to Section 3.03 below, any Member whose employment terminates during the period beginning on January 1, 2009 and ending on February 25, 2009 during the 2009 Plan Year by reason of Retirement, death or Disability, shall be entitled to a minimum guaranteed Company Matching Contribution of $.25 per $1.00 of Member Contributions up to 5% of Pay in accordance with the Plan terms then in effect.

     3.03 Allocation of Company Contributions. The Company Contributions shall be allocated only to the Company Accounts of Members who are employed by the Employer on the last day of the Plan Year and on behalf of Members whose employment has terminated during

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the Plan Year by reason of Retirement, death or Disability. Company Profit Sharing Contributions shall be credited to eligible Members’ Company Profit Sharing Contribution Accounts. Company Profit Sharing Contributions allocated prior to or as of July 31, 1997 shall be fully vested; Company Profit Sharing Contributions allocated thereafter shall be subject to the vesting provisions of Section 6.07. Company Matching Contributions shall be subject to the vesting provisions of Section 6.07 and to the withdrawal penalty provisions of Section 8.02(a). No Company Matching Contribution shall be made with respect to a Member Before-Tax Contribution in excess of the Code Section 402(g) and 414(v) limit, as revised from time to time.

     3.04 Profit Sharing Allocation Formula. The Company Profit Sharing Contribution, if any, shall be allocated to all Members eligible to share in the contribution according to the ratio that each Member’s Allocation Pay Amount for the Plan Year bears to the total Allocation Pay Amount for all eligible Members for the Plan Year. For this purpose the term eligible Members includes Members in both the Puerto Rico Plan and this Plan.

     3.05 Investment of the Company Contribution. The amounts allocated to each Member pursuant to Section 3.03 shall be credited to his Company Accounts and invested in one or more of the Investment Funds described in Section 5.01 and in the percentages designated by the Member in the investment election filed pursuant to Section 5.02 effective at the time the amount is allocated.

     3.06 Return of Company Contributions.

(a) If, after the Company Contribution has been made and allocated, it should appear that, through oversight or a mistake of fact or law, a Member (or an Associate who should have been considered a Member) who should have been entitled to share in such contribution, receives no allocation or receives an allocation which was less than he should have received, the Company may, at its election and in lieu of reallocating such contribution, make a special make-up contribution for the Company Account of such Member in an amount sufficient to provide for him the same addition to his Company Account as he should have received. Similarly, if a Member received an allocation which was more than he should have received (or an Associate was inappropriately included in the Plan), the Company, at its election, may reallocate such contribution, offset other Company contributions against such allocation, or use such allocation to pay Plan expenses.

(b) Each contribution made to the Trust shall be made on the condition that it is currently deductible by the Company or Employer under Code Section 404 for the taxable year with respect to which the contribution is made. If a contribution subsequently is determined, whether in whole or in part, not to be currently deductible as provided in the preceding sentence, then, within one year of the date of disallowance of the deduction of such Company Contribution, an amount equal to the disallowed deduction shall be returned to the Company or Employer.

(c) Earnings attributable to a contribution that is returned pursuant to Subsection (a) or (b)) above shall not be withdrawn, but losses attributable thereto shall reduce the amount returned to the Company and/or Employer.

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SECTION 4

Member Contributions

     4.01 Procedure for Making Contributions.

(a) After-Tax Contributions. Subject to the limitations set forth in Sections 4.02, 4.03 and 4.04, each Member may contribute to the Plan an amount (in whole percentage points) equal to not less than 1% nor more than 15% (effective May 1, 2002, 75%) of his Pay as he shall have designated pursuant to procedures established by the Company (which may establish lower permissible After-Tax Contributions for Highly Compensated Employees); provided, however, that any Before-Tax Contributions made on behalf of the Member shall reduce, by the percentage which he elects to have contributed pursuant to Section 4.01(b)(i), the percentage of Pay that the Member may contribute pursuant to this Section 4.01(a).

(b) Before-Tax Contributions.

(i) Subject to the limitations set forth below, each Member may elect that his Employer shall contribute directly to the Trust Fund an amount equal to a whole percentage of his Pay, not less than 1% nor greater than such percentage as may be determined from time to time by the Company which amount shall be his Before-Tax Contribution. The maximum Before-Tax Contribution by a Member determined to be a Highly Compensated Employee under Section 4.02, for the Plan Year in question, may be further restricted or limited by the Company or Committee from time to time.

(ii) Pursuant to Section 2.01(c), each eligible Member who has satisfied the requirements of such section shall be deemed to have elected to make a three percent (3%) Before-Tax Contribution, unless the Member elects otherwise in accordance with procedures established by the Committee.

(c) Notwithstanding any election in accordance with Section 4.01(b), if the Committee at any time determines that all or any portion of the Member’s Before-Tax Contributions should be treated as After-Tax Contributions in order for the Before-Tax Contribution provisions of the Plan to qualify as a “qualified cash or deferred arrangement” for purposes of Code Section 401(k), or if the Actual Deferral Percentage standards set forth in Code Section 401(k)(3) are not met at the end of the Plan Year, then the Committee, in its sole and absolute discretion,

(i) may, in accordance with Section 4.02 below, limit the amount which shall be contributed by the Employer as Before-Tax Contributions after the date of such determination on behalf of all or any portion of the Members and,

(ii) may, except with respect to situations in which Section 4.01(h) applies, (and prior to March 15 of the calendar year following the Plan Year in which such contributions are made) declare all or such portion of the Before-Tax

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Contributions theretofore or thereafter made on behalf of all or a portion of the Members to be After-Tax Contributions. Effective January 1, 1997, if Before-Tax Contributions are made to another plan or plans, this Plan and such other plans must be aggregated for purposes of Section 410(b) of the Code (other than the average benefit percentage test).

(d) The Employer shall (i) deduct a Member’s After-Tax Contributions from the Pay of the Member in such installments as the Employer may deem appropriate, (ii) contribute a Member’s Before-Tax Contributions on behalf of the Member, and (iii) reduce the Pay that is paid to the Member directly in cash by an amount equal to the Member’s Before-Tax Contributions in such installments as the Employer shall deem appropriate. The amounts so deducted and so contributed shall be paid by the Employer to the Trustee not later than 15 days following the end of the month with respect to which such amounts are to be so deducted and contributed or within such shorter period of time as may be designated under the Code, ERISA or related regulations. The Employer may, from time to time, make estimated contribution payments to the Trustee during each month.

(e) Effective with the first payroll period beginning in any calendar month, or as of such other effective time as may be determined by the Committee, a Member may elect to change the rate of his After-Tax Contributions to any other rate permitted by Subsection (a) of this Section 4.01 and may elect to change the amount to be contributed by the Employer directly to the Trust Fund as Before-Tax Contributions to an amount equal to an amount permitted by Subsection (b) of this Section 4.01 with respect to such contributions to be made after the effective date of the election, pursuant to procedures established by the Committee.

(f) Not later than 15 days prior to the beginning of a payroll period of a Member, or not later than such other date as may be determined by the Committee, such Member may elect, pursuant to procedures established by the Committee, (i) to suspend making After-Tax Contributions and (ii) that the Employer should suspend making Before-Tax Contributions on his behalf, all as of the beginning of such payroll period. Not later than 15 days prior to the beginning of a payroll period of a Member, or not later than such other date as may be determined by the Committee, such Member may elect (i) to resume making After-Tax Contributions and, (ii) that the Employer shall resume making Before-Tax Contributions on his behalf, by indicating any amount of contributions permitted under Subsection (a) and designating an amount equal to any amount of Pay as Before-Tax Contributions that is permitted under Subsection (b) hereof.

(g) Contributions pursuant to this Section 4.01 shall be credited to Member Accounts.

(h) Notwithstanding any election in accordance with Subsection (b), the total amount of a Member’s Before-Tax Contributions and other contributions made by the Member under Code Section 401(k) to another plan qualified under Code Section 401(a) for any calendar year shall not exceed $16,500 (as adjusted from time to time by the Secretary of the Treasury or his delegate, pursuant to Code Section 415(d)). If any Member may reach the $16,500 limit (as adjusted) the Committee can direct that all or any portion of

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such Member’s Contributions during such year shall be After-Tax Contributions regardless of such Member’s elections pursuant to Sections 4.01(a) and 4.01(b). Effective May 1, 2002, all employees who are eligible to make elective deferrals under this Plan and who have attained age 50 before the close of the Plan Year shall be eligible to make catch-up contributions in accordance with, and subject to the limitations of, Section 414(v) of the Code. Such catch-up contributions shall not be taken into account for purposes of the provisions of the Plan implementing the required limitations of Sections 402(g) and 415 of the Code. The Plan shall not be treated as failing to satisfy the provisions of the Plan implementing the requirements of Sections 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416 of the Code, as applicable, by reason of the making of such catch-up contributions.

(i) The Committee shall provide each new Member a notice that explains the procedure for making Before-Tax Contributions under Sections 4.01(b) and 2.01(c), including the Member’s right to elect to make no Before-Tax Contribution from his or her Pay and the manner in which the amount of such contributions may be changed. In addition, the Committee shall provide an annual notice to each Member indicating his or her Before-Tax Contributions as a percentage of Pay, describing the right to alter and the procedure for changing such percentage, and explaining the timing for implementation of any such change.

     4.02 Limitations On And Distributions Of Before-Tax Contributions For Highly Compensated Employees.

     The Committee is authorized to reduce to the extent necessary the maximum contributions under Section 4.01(b) for Highly Compensated Employees prior to the close of the Plan Year if the Committee reasonably believes that such reduction is necessary to prevent the Plan from failing both tests in Code Section 401(k)(3). Such adjustments shall be made in accordance with rules prescribed by the Committee. The Committee may implement rules limiting contributions under Section 4.01(b) which may be made on behalf of some or all Highly Compensated Employees so that the limits of Section 401(k)(3) or 401(m)(2) of the Code are satisfied. If for any Plan Year the Plan satisfies neither of the tests set forth in Code Section 401(k)(3), the Trustee shall be directed by the Committee to return to each Highly Compensated Employee his or her portion of the excess contributions (plus the income or less the loss allocable to such excess contributions) for such Plan Year within 12 months after the last day of such Plan Year. A Highly Compensated Employee shall forfeit any Matching Contributions which were contributed on account of any portion of the excess contributions even if such Matching Contributions are vested. Each Highly Compensated Employee’s portion of the excess contributions for a Plan Year shall be determined under a two step process. First, the aggregate amount of excess contributions shall be calculated. This shall be done by reducing the actual deferral percentages of those Highly Compensated Employees with the highest actual deferral percentages to the extent necessary but not below the next highest level of actual deferral percentages. This process shall be repeated, to the extent necessary, until the actual deferral percentage for the group of Highly Compensated Employees satisfies one of the tests set forth in Code Section 401(k)(3). The aggregate amount of excess contributions shall be equal to the sum of all such reductions. Second, the aggregate amount of excess contributions to be returned shall be allocated by reducing the Before-Tax Contributions of those Highly Compensated Employees

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with the highest amount of Before-Tax Contributions to the extent necessary but not below the next highest amount of Before-Tax Contributions. This process shall be repeated, to the extent necessary, until all excess contributions to be returned shall be allocated among the Highly Compensated Employees. The income or loss allocable to a Highly Compensated Employee’s portion of the excess contribution will be determined under such reasonable method as the Committee shall establish, provided the method does not discriminate in favor of Highly Compensated Employees, is used consistently for all Members and for all corrective distributions under the Plan for the Plan Year, and is used by the Plan for allocating income to Members’ accounts.

(a) Coordination With Distributions Of Elective Deferrals. If the Plan is required to distribute both elective deferrals and excess contributions for a Plan Year, the Plan shall:

(i) calculate and distribute the elective deferrals before determining the excess contributions to be distributed to Highly Compensated Employees;

(ii) calculate the actual deferral percentage including the amount of excess elective deferrals distributed pursuant to (i) above; and

(iii) distribute excess contributions to Members by reducing the excess contributions distributed to a Member by the amount of excess elective deferrals distributed to such Member.

(b) Election To Make Additional Contributions. Notwithstanding the above, in accordance with Treasury Regulation Section 1.401(k)-2(a)(6), the Company may elect, in lieu of all or a portion of the corrective distribution described above in this Section, to make additional qualified nonelective contributions or qualified matching contributions which are treated as elective deferrals under the Plan and that, in combination with the elective deferrals, satisfy the actual deferral percentage test. Any such additional qualified nonelective contributions will be credited to a Member Before-Tax Account and shall be allocated to each Member who is not a Highly Compensated Employee in an amount as determined by the Company and will be contributed as a percentage of such Member’s Pay for the Plan Year. Any such additional qualified matching contributions will be credited to a Member Before-Tax Account and shall be allocated to each Member who is not a Highly Compensated Employee and will be contributed as a percentage of the amount contributed by such Member under Section 4.01(b).

(c) Testing Year. The actual deferral percentage of Non-Highly Compensated Employees shall be determined as of the Plan Year preceding the Plan Year for which the Plan must satisfy one of the tests in Code Section 401(k)(3).

     4.03 Distributions of Excess Deferrals.

     If a Member’s elective deferrals for any calendar year exceed $16,500 (or such higher amount prescribed under Section 402(g) of the Code), then the Member may file an election form prescribed by the Committee with the Employer/Company designating in writing the amount of the Member’s Excess Before-Tax Deferrals to be distributed from this Plan. Any such

17

election form must be filed with the Committee no later than the first March 1 following the close of such calendar year in order for the Committee to act on it. If such an election form is timely filed, the Trustee shall distribute to the Member the amount of such Excess Before-Tax Deferrals which the Member has allocated to this Plan together with any income or less any loss allocable to such amount on or before the first April 15 following the close of such calendar year. In the case of a Highly Compensated Employee, any Matching Contributions which were contributed on account of the Excess Before-Tax Deferrals being distributed will be forfeited, even if such Matching Contributions are vested. For purposes of this Section 4.03, the income or loss allocable to such Excess Before-Tax Deferrals will be determined under such reasonable method as the Committee shall establish, provided the method does not discriminate in favor of Highly Compensated Employees, is used consistently for all Members and for all corrective distributions under the Plan for the Plan Year, and is used by the Plan for allocating income to Members’ accounts.

     4.04 Limitations On And Distributions Of After-Tax Employee Contributions And Matching Contributions For Highly Compensated Employees.

     The Committee is authorized to reduce to the extent necessary the maximum amount of Employer Matching Contributions under Section 3.02 and Member After-Tax Contributions contributed on behalf of any Highly Compensated Employee prior to the close of the Plan Year if the Committee reasonably believes that such adjustment is necessary to prevent the Plan from failing both tests in Code Section 401(m)(2). Such reduction shall be made in accordance with rules prescribed by the Committee. Notwithstanding anything herein to the contrary, the tests in Code Section 401(m)(2) shall be treated as satisfied with respect to such Matching Contributions and After-Tax Contributions to the Plan, or a portion of the Plan, if the Plan or such portion is a collectively bargained plan that automatically satisfies Code Section 410(b), in accordance with Treasury Regulation Sections 1.401(m)-1(b)(2) and 1.410(b)-2(b)(7). If for any Plan Year the Plan fails to satisfy either of the tests set forth in Code Section 401(m)(2), the Trustee shall be directed by the Committee to distribute to each Highly Compensated Employee his or her vested portion (and forfeit the nonvested portion) of the excess aggregate contributions (plus the income or less the losses allocable to such excess aggregate contributions) for such Plan Year, within 12 months after the last day of such Plan Year. Each Highly Compensated Employee’s portion of the excess aggregate contributions for a Plan Year shall be determined under a two step process. First, the aggregate amount of excess aggregate contributions shall be calculated. This shall be done by reducing the actual contribution percentages of those Highly Compensated Employees with the highest actual contribution percentages to the extent necessary but not below the next highest level of actual contribution percentages. This process shall be repeated, to the extent necessary, until the actual contribution percentage for the group of Highly Compensated Employees satisfies one of the tests set forth in Code Section 401(m)(2). The aggregate amount of excess aggregate contributions shall be equal to the sum of all such reductions. Second, the aggregate amount of excess aggregate contributions to be distributed or forfeited shall be allocated by first reducing any After-Tax Contributions and then any Matching Contributions made by or on behalf of Highly Compensated Employees with the highest total amount of After-Tax Contributions and Matching Contributions to the extent necessary but not below the next highest total amount of After-Tax Contributions and Matching Contributions. This process shall be repeated, to the extent necessary, until all excess aggregate contributions to be distributed or forfeited shall be allocated among the Highly Compensated Employees. A Highly Compensated

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Employee whose After-Tax Contributions are determined to be excess aggregate contributions shall forfeit any Matching Contributions which were contributed on account of such After-Tax Contributions, even if such Matching Contributions are vested. The income or loss allocable to a Highly Compensated Employee’s portion of the excess aggregate contributions will be determined under such reasonable method as the Committee shall establish, provided the method does not discriminate in favor of Highly Compensated Employees, is used consistently for all Members and for all corrective distributions under the Plan for the Plan Year, and is used by the Plan for allocating income to Members’ accounts.

(a) Election To Make Additional Contributions. Notwithstanding the above, in accordance with Treasury Regulation Section 1.401(m)-2(a)(6), the Company may elect, in lieu of all or a portion of the distribution described above, to either (i) make an additional qualified nonelective contribution that, in combination with Matching Contributions and After-Tax Contributions for the Plan Year, satisfies the actual contribution percentage test or (ii) recharacterize elective contributions as Matching Contributions. Any such additional qualified nonelective contributions will be credited to a Member Before-Tax Account and shall be allocated to each Member who is not a Highly Compensated Employee in an amount as determined by the Company and will be contributed as a percentage of such Member’s Pay for the Plan Year.

(b) The actual contribution percentage of Non-Highly Compensated Employees shall be determined as of the Plan Year preceding the Plan Year for which the Plan must satisfy one of the tests in Code Section 401(m)(2).

4.05 Definitions and Special Rules.

(a) Repeal of Multiple Use Test. The Multiple use test described in Treasury Regulation Section 1.401(m)-2 shall not apply for Plan Years beginning after December 31, 2001.

(b) Special Definitions. All terms used in this Section 4 shall have the meaning given such terms in Code Sections 401(k) and 401(m) and the regulations thereunder.

(c) Special Rule For Early Participation. If the Company applies Code Section 410(b)(4)(B) in determining whether the Plan satisfies Code Section 410(b) by excluding from consideration eligible Associates who have not met minimum age and service requirements, the Company may exclude from consideration all Non-Highly Compensated Employees who have not met the minimum age and service requirements of Code Section 410(a)(1)(A) for purposes of satisfying the tests in Code Sections 401(k)(3) and 401(m)(2).

(d) Highly Compensated Employee In Two Or More Qualified Plans. The actual contribution percentage and the actual deferral percentage of a Highly Compensated Employee who is eligible to participate in two or more qualified plans which have (i) cash or deferred arrangements or (ii) Matching Contributions or After-Tax Contributions features maintained by the Employer or a member of the Group, shall be calculated by treating all such cash or deferred arrangements in which the Highly

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Compensated Employee is eligible to participate as one cash or deferred arrangement for purposes of calculating the actual deferral percentage for such Highly Compensated Employee and all such features in which the Highly Compensated Employee is eligible to participate as one feature for purposes of calculating the actual contribution percentage for such Highly Compensated Employee with respect to years ending within the same calendar year.

(e) Plan Restructuring. The Plan may be aggregated with another plan or other plans or disaggregated under Section 1.401(k)-1(b)(4) and Section 1.401(m)-1(b)(4) of the Treasury Regulations for any Plan Year in order to pass the actual contribution percentage and actual deferral percentage tests set forth in this Section.

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SECTION 5

Investment Provisions

     5.01 Investment Funds.

(a) There shall be established as part of the Trust Fund a reasonable range of investment options. The Committee may from time to time, in its discretion, change, delete or add Investment Funds available within the Trust Fund; provided that unless and until the Plan is amended accordingly, the Plan shall continue to provide a Collective Brands Common Stock Fund as an investment option.

(b) Income from and proceeds of sales of investments in each Investment Fund shall be reinvested in the same Investment Fund. Any income or other taxes payable with respect to a Fund shall be charged to such Fund.

(c) A Trustee may, from time to time, make temporary investments in short term obligations of the United States Government, commercial paper, or other investments of a short term nature, pending investment in an Investment Fund.

     5.02 Investment Direction.

(a) A Member may elect that his Member Contributions be invested in 1% increments totaling 100% in one or more of the Investment Funds. Such election must be made pursuant to procedures prescribed by the Committee. Such election shall be effective until and unless a Member makes a different election for any period, but only as provided for under Subsection 5.02(b) and Subsection 5.02(c). If the Member fails to file a timely initial investment election, he shall be deemed to have elected to have 100% of his Member Contributions invested in the qualified default investment arrangement as may be determined by the Committee. Until such time as the Committee determines otherwise and so notifies Members, a Member’s share of any Company Contributions, when allocated as of Plan Year-end, shall be invested in the same Investment Funds in the same proportions as the Member has elected in connection with investment of his Member Contributions at the time the Company Contribution is contributed to the Trust. Notwithstanding the preceding, effective September 1, 2011, the amount of future contributions that a Member may elect pursuant to this Subsection 5.02(a) to be invested in the Collective Brands Common Stock Fund shall be limited to 20% of such contributions.

(b) A Member may change his election with respect to future Member and Company Contributions effective pursuant to procedures prescribed by the Committee and may not change his election in any other manner except as provided in Subsections 5.02(a) and 5.02(c).

(c) Subject to Section 5.02(a), effective as of the date determined by the Committee, and pursuant to procedures prescribed by the Committee, a Member may elect to have any or all of the value in any of the Investment Funds which are credited to his Member

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and/or Company Accounts transferred and invested in any one or more of the Investment Funds.

(d) Notwithstanding this Section 5.02, effective March 20, 2000, during the black out period as determined by the Committee and the Trustee established to change to daily valuation or a change in recordkeepers, no investment transfers or changes may be made by a Member unless provided in Section 6.06. Notwithstanding anything to the contrary, no loans, withdrawals or distributions shall be made during any such blackout period except as provided by the Committee.

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SECTION 6

Accounts

     6.01 Member Accounts. The Committee shall maintain or cause to be maintained for each Member under each Investment Fund in which his Member Contributions are invested separate Member Accounts which shall reflect the portion of his interest in such Investment Fund which is attributable to his contributions. The Member’s After-Tax Contributions shall be credited to a separate Member After-Tax Account. The Member’s Before-Tax Contributions shall be credited to a separate Member Before-Tax Account. The Member’s or Associate’s Rollover Contributions shall be credited to a separate Member Rollover Contribution Account.

     6.02 Company Accounts. The Committee shall maintain or cause to be maintained for each Member under each Investment Fund in which his Company Contributions are invested separate Company Accounts which shall reflect the portion of his interest in such Investment Fund which is attributable to Company Contributions, as well as to contributions made by an Employer under prior plans and to any income or earnings attributable to such Company Contributions and prior plan contributions. The Member’s Company Matching Contributions shall be credited to a separate Company Matching Contribution Account. The Member’s Company Profit Sharing Contribution, if any, shall be credited to a separate Company Profit Sharing Contribution Account.

     6.03 Maintenance of Accounts. For the purposes of maintaining Accounts pursuant to this Section 6, each Investment Fund shall be divided into Units, and the Interest of each Member in such Investment Fund shall be evidenced by the number of Units in such Investment Fund credited to his Accounts.

     6.04 Valuation of Accounts. As of each Valuation Date the Committee shall determine the value of a Unit in each Account by dividing the current market value of all property in each such Account as of such Valuation Date (after deducting any expenses or other amounts including withdrawals properly chargeable against such Account) by the number of Units then outstanding to the credit of all Members in each such Account.

     6.05 Member Statements. The Committee shall furnish or cause to be furnished to each Member a statement of his Company and Member Accounts, at least once each year, or more frequently if required by applicable law.

     6.06 Shares of Collective Brands, Inc. (“Collective Brands Stock”) in the Collective Brands Common Stock Fund.

(a) Each Member (or beneficiary of a deceased Member) who has Accounts invested in the Collective Brands Common Stock Fund shall, as a named fiduciary within the meaning of Section 403(a)(1) of ERISA, have the right to direct the Trustee with respect to the vote of the number of shares of Collective Brands Stock attributable to Units credited to him in the Collective Brands Common Stock Fund as of the latest practicable Valuation Date prior to or contemporaneous with the record date set by the Company for each meeting of shareowners of the Company. For such purpose the Trustee shall furnish

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to each such Member prior to each such meeting the proxy statement for such meeting, together with a form to be returned to the Trustee on which may be set forth the Member’s instructions as to the manner of voting such shares of stock. Upon receipt of such instructions, the Trustee shall vote such shares in accordance therewith. If a Member’s instructions are not received by the Trustee in a timely manner, the Trustee shall vote such Member’s shares in the same proportion as the shares of Common Stock for which instructions were actually timely received from Members. The Trustee shall not divulge the instructions of any Member.

(b) Each Member (or beneficiary of a deceased Member) who has Accounts invested in the Collective Brands Common Stock Fund shall, as a named fiduciary within the meaning of Section 403(a)(1) of ERISA, have the right with respect to the number of shares of Collective Brands Stock attributable to Units credited to him in the Collective Brands Common Stock Fund as of the latest practicable Valuation Date, to direct the Trustee in writing as to the manner in which to respond to a tender or exchange offer with respect to Collective Brands Stock, and the Trustee shall respond in accordance with the instructions so received. The Trustee shall utilize its best efforts to timely distribute or cause to be distributed to each Member such information as will be distributed to shareowners of the Company in connection with any such tender or exchange offer, together with a form requesting instructions on whether or not such shares will be tendered or exchanged. If the Trustee shall not receive timely direction from a Member as to the manner in which to respond to such a tender or exchange offer, the Trustee shall not tender or exchange any shares of Collective Brands Stock with respect to which such Member has the right of direction. Tenders as a result of a self-tender offer by the Company shall continue notwithstanding any investment change blackout. The Trustee shall not divulge the instructions of any member. The proceeds from the tender or exchange of shares attributable to Units in Collective Brands Common Stock Investment Fund accounts of Members shall be transferred to one of the Investment Funds described in Section 5.01 pursuant to a procedure established by the Committee.

     6.07 Vesting in Member and Company Accounts.

(a) Vesting Schedule. Unless otherwise specified herein, a Member shall have a fully vested interest at all times (i) in his Member Accounts and (ii) in his Company Profit Sharing Contribution Account balance determined as of July 31, 1997. A Member who has completed at least two full Years of Service as of August 1, 1997 also shall be fully vested at all times (i) in his Company Matching Contribution Account and (ii) in his Company Profit Sharing Contribution Account determined at any time after July 31, 1997. The Company Matching Contribution Account of a Member who is not or was not credited with at least two Years of Service as of August 1, 1997 and his Company Profit Sharing Contribution Account attributable to Company Profit Sharing Contributions, if any, based on such Member’s eligibility for such contributions after August 1, 1997, shall vest according to the following schedule:

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Vesting Service	Vested Interest
Fewer than 2 years		0	%
2 years		25	%
3 years		50	%
4 years		75	%
5 years or more		100	%

     Notwithstanding the foregoing, a Member’s interest in his Company Matching Contribution Account and his Company Profit Sharing Contribution Account shall become fully vested if the Member terminates employment on account of Retirement, death or Disability.

     A Member’s interest in any “non-elective contributions” or “employer matching contributions” as defined in the CLI Plan which were attributed to Member’s Account for services rendered through December 31, 2008, shall vest as follows:

Vesting Service	Vested Interest
Fewer than 1 year		0	%
1 year		25	%
2 years		50	%
3 years		75	%
4 years or more		100	%

     Notwithstanding the foregoing, a Member’s interest in any “non-elective contributions” or “employer matching contributions” as described above, shall become fully vested if the Member terminates employment on account of death or Disability.

(b) Cash-out Distributions to Partially Vested Members and Restoration of Forfeitures. If, pursuant to Section 10.01, a partially-vested Member receives a cash-out distribution before he incurs a Forfeiture Break in Service (as defined in Subsection (d) below), the cash-out distribution will result in an immediate forfeiture of the nonvested portion(s) of the Member’s Company Matching and Company Profit Sharing Contribution Account(s). See Subsection (e) below. A partially-vested Member is a Member whose Vested Interest, determined under Section 6.07(a), in either his Company Matching Contribution Account or his Company Profit Sharing Contribution Account, or both, is less than 100%. A cash-out distribution is a distribution of the entire vested portion of the Member’s Account(s).

(i) A partially-vested Member who is reemployed by an Employer after receiving a cash-out distribution of the vested portion of his Account(s) shall have such forfeited amount restored, unless the Member no longer has a right to restoration under this subparagraph (i). The amount restored by the Plan Administrator shall be the same dollar amount as the dollar amount of his

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Account(s) on the Valuation Date immediately preceding the date of the cash-out distribution, unadjusted for any gains or losses occurring subsequent to that Valuation Date but reduced by the amount of the prior cash-out distribution. Restoration of the Member’s Account balance(s) includes restoration of all Code Section 411(d)(6) protected benefits with respect to the restored Account(s) in accordance with applicable Treasury regulations. The Plan Administrator will not restore a reemployed Member’s Account balance(s) under this subparagraph (i) if the Member (1) has incurred a Forfeiture Break in Service (as defined in Subsection (d) below), or (2) terminates employment with the Employer prior to the last day of the Plan Year in which the Member was reemployed.

(ii) If restoration of the Member’s Account(s) is permitted under subparagraph (i) above, the Plan Administrator will restore the Member’s Account(s) on the same day as the date of allocation of the Company Contribution for the Plan Year during which such Member was reemployed by an Employer. To restore the Member’s Account(s), the Plan Administrator, to the extent necessary, will allocate to the Member’s Account(s):

(A) first, the amount, if any, of Member forfeitures otherwise available for allocation under Subsection (e) below;

(B) second, deductible Employer contributions for the Plan Year to the extent made under a discretionary formula; and

(C) third, as otherwise permitted by law.

The Plan Administrator will not take into account any allocation under this Subsection (b) in applying the limitation on allocations under Section 13.

(iii) The deemed cash-out rule applies to a 0% vested Member. A 0% vested Member is a Member whose Account(s) derived from Employer contributions is (are) entirely forfeitable at the time of his termination of employment. Under the deemed cash-out rule, the Plan Administrator will treat the 0% vested Member as having received a cash-out distribution on the date of the Member’s termination of employment or, if the Member’s Account(s) is (are) entitled to an allocation of Employer contributions for the Plan Year in which he terminates employment, on the last day of that Plan Year.

(c) Determination of Vesting Service. For purposes of determining a Member’s Vested Interest in his Company Contributions Account(s) under Subsection (a) above, a Member shall be credited with that number of years of Vesting Service determined by adding together all of the Associate’s Periods of Service, whether or not consecutive, prior to January 1, 2012 plus his years of Vesting Service completed on and after January 1, 2012 determined in accordance with Section 1.52. Notwithstanding the foregoing, Vesting Service shall not include any Period of Service or Hours of Service before the Plan Year in which an Associate attains age eighteen (18). Only whole years of service shall be taken into account for purposes of applying the schedule set forth in

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Subsection (a) above, and, for purposes of determining a Member’s number of whole years of service, non-successive Periods of Service prior to January 1, 2012 must be aggregated, with 365 days of service being deemed to constitute one year. For purposes of determining a Member’s Period of Service prior to January 1, 2012, the Service Spanning rules described in Section 1.52(g) shall apply.

(d) Forfeiture Break in Service. For purposes of this Section 6.07, prior to January 1, 2012, a “Break in Service” is a Period of Severance of at least 365 days. Effective January 1, 2012, a “Break in Service” is a Plan Year in which a person completes 500 or fewer Hours of Service. A “Forfeiture Break in Service” occurs when a Member or former Member incurs 5 consecutive Breaks in Service.

(e) Forfeiture Occurs. A Member’s forfeiture, if any, of his Account balance(s) derived from Company contributions occurs under the Plan on the earlier of:

(i) the last day of the last pay period ending within the Plan Year in which the Member first incurs a Forfeiture Break in Service; or

(ii) the date the Member receives a cash-out distribution.

     The Plan Administrator shall determine the percentage of a Member’s Account(s) forfeiture, if any, under this Subsection (e) solely by reference to the vesting schedule of Section 6.07(a). As of the last day of each Plan Year, the total amount of forfeitures which occurred during such Plan Year shall be calculated and such amount shall be applied (i) to restore under (b) above any amounts previously forfeited from rehired Members’ Accounts, (ii) to pay Administrative Expenses under Section 7.01 and (iii) the balance, if any, shall be added to and allocated with the Company Matching Contribution for that Plan Year.

(f) Former May Plan Members. The provisions of this Subsection (f) apply to a Member who previously was employed by the Employer, when it was part of the Group which included The May Department Stores Company, and who at the termination of his employment had Company Accounts in the May Plan which were forfeited as a result of termination of employment. If such Member has not incurred five consecutive Breaks in Service as defined in Section 6.07(b) and (d), the value of the Member’s Company Account forfeited under the May Plan will be restored under this Plan (in the manner described in Subsection (b) above) and will be 100% vested.

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SECTION 7

Expenses

     7.01 Administrative Expenses. To the extent permitted by applicable law, the costs and expenses for administering this Plan, consisting of Trustee fees and expenses, Investment Manager fees and expenses, fees and expenses of outside experts, expenses of maintaining records under Section 6 of the Plan, and all other administrative expenses of the Plan, shall be paid out of the Trust Fund unless the Company elects to pay them with its own funds. Costs incident to the purchase and sale of securities, such as brokerage fees, commissions and stock transfer fees, are not regarded as administrative expenses and shall be borne by the appropriate Investment Fund as determined by the Trustee or Committee.

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SECTION 8

Withdrawals During Employment

     8.01 Withdrawals Prohibited Unless Specifically Authorized. No withdrawal from the Plan shall be permitted prior to a Member’s termination of employment, except as provided in Section 8.02.

     8.02 Authorized Withdrawals.

(a) Prior to his termination of employment, a Member may elect to withdraw, in cash, any or all of the value in his Member After-Tax Accounts. However, in the event a Member elects to withdraw all or a portion of his After-Tax Contributions made after August 1, 1997, such Member shall forfeit his right to fifty percent (50%) of the Company Matching Contribution, if any, otherwise allocable in connection with his Member Contributions for the Plan Year in which the withdrawal occurs.

(b) Prior to his termination of employment, a Member may elect to withdraw, in the event of a “hardship”, an amount in cash up to (i) the total amount of the Before-Tax Contributions made to the Trust on his behalf, or (ii) the value in his Member Before-Tax Account, whichever is less. In any event the amount withdrawn may not be greater than the amount determined by the Committee as being required to meet the immediate financial need created by the “hardship” and not reasonably available from other resources of the Member, whichever amount is less. The term “hardship” means a heavy financial hardship in light of immediate and heavy financial needs as determined by the Committee in accordance with Internal Revenue Service regulations. The amount of an immediate and heavy financial need may include any amounts necessary to pay any federal, state or local taxes or penalties reasonably anticipated to result from the distribution. The determination shall be made in a nondiscriminatory manner. Hardship shall include but not be limited to the following:

(i) Expenses for (or necessary to obtain) medical care that would be deductible under Code Sections 213(a) and (d) (determined without regard to whether the expenses exceed any applicable threshold amount of adjusted gross income);

(ii) Purchase (excluding mortgage payments) of a principal residence for the Member;

(iii) Payment of tuition, related educational fees, and room and board expenses for the next 12 months of post-secondary education for the Member, his or her spouse, children, or dependents (as defined in Code Section 152);

(iv) The need to prevent the eviction of the Member from his or her principal residence or foreclosure on the mortgage of the Member’s principal residence.

(v) (Effective January 1, 2006). Payments for burial or funeral expenses for a Member’s deceased parent, spouse, children or dependents (as defined in Section 152

29

of the Code and effective January 1, 2006), without regard to Section 152(d)(1)(B).

(vi) (Effective January 1, 2006). Expenses for the repair of damage to Member’s principal residence that would qualify for the casualty deduction under Section 165 of the Code (determined without regard to whether the loss exceeds 10% of adjusted gross income).

     The Committee may adopt written guidelines which identify additional circumstances constituting hardship and which provide procedures to be followed in the administration of hardship withdrawal requests, which guidelines are hereby incorporated herein.

     In addition, such hardship must be one which in the judgment of the Committee, based on the Member’s representations, cannot be relieved (1) through reimbursement or compensation by insurance or otherwise, (2) by reasonable liquidation of the Member’s assets to the extent such liquidation would not itself cause an immediate and heavy financial need, (3) by cessation of Member Contributions under the Plan, (4) by other distributions or loans from employee benefit plans, including this Plan, maintained by the Company or any other employer or (5) by borrowing from commercial sources on reasonable commercial terms. The Member shall be required to submit documentation, to be determined by the Committee, with his hardship withdrawal request to enable the Committee to make a judgment regarding the validity of such hardship withdrawal request. For any Member who has attained age 59¹/2, the “hardship” requirement shall be deemed waived.

(c) A Member who was a Participant in or eligible to be a Participant in the Volume Shoe Corporation Profit Sharing Plan (the “Volume Plan”) as of December 31, 1988 and who had an account balance in the Volume Plan attributable to Employer Contributions made to the Volume Plan before July 31, 1976 and which account became a Company Account under The May Department Stores Company Profit Sharing Plan and which has been transferred to this Plan, shall be entitled to withdraw the market value of such account balance determined (and frozen) as of December 31, 1988.

(d) A Member who has attained age 59 ¹/2, and who was a Participant in or eligible to be a Participant in the CLI Plan as of December 31, 2008, and who had an account balance in the CLI Plan on such date, shall be eligible to withdraw any portion of his vested Transferred Account.

(e) Associates with Member Rollover Contribution Accounts may elect to withdraw their Member Rollover Contribution Accounts prior to termination of employment.

(f) A withdrawal election shall be made pursuant to application procedures established by the Committee. Contribution totals and Account values shall be determined as of the Valuation Date coinciding with or next following the filing of the withdrawal election. If the Member Accounts from which withdrawal is made are in more than one Investment Fund, the withdrawal shall be pro rata from each such Investment Fund except in the case the Member is subject to Section 16 of the Securities Exchange Act of 1934 or has been designated as a “Designated Insider,” in which case

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such Member’s withdrawal will be taken first from such Member’s Investment Funds other than the Collective Brands Common Stock Fund.

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SECTION 9

Benefits Upon Retirement, Death, Disability or Termination of Employment

     9.01 Benefits. Upon a Member’s Retirement, death, Disability, or other termination of employment, the value of his Member Accounts and of his vested Company Accounts shall be determined as of the Valuation Date prior to the date the distribution is calculated. A temporary Authorized Leave of Absence for Military Service or for other purposes approved by the Employer shall not, while any such Authorized Leave of Absence is validly in effect, be regarded as a termination of employment. Effective January 1, 2007, if a Member dies while performing qualified Military Service, then the Member’s spouse or Beneficiary is entitled to any benefits (other than benefit accruals relating to the period of qualified Military Service), and the rights and features accompanying such benefits, that such Member would otherwise be entitled to under the terms of the Plan had the Member been reemployed by the Employer and terminated employment with the Employer on account of death.

     Any person who is a Leased Employee (as defined in Code Section 414(n), without regard to Section 414(n)(2)(B)) of any member of the Group shall be treated for all purposes of the Plan as if he were employed by a member of the Group which has not adopted the Plan. Notwithstanding anything to the contrary in the Plan, a transfer from the status of an employee of the Employer to that of a Leased Employee shall not be considered a termination of employment under the Plan. An individual who has such a transfer shall not have a termination of employment until he ceases to be an employee of the Employer and all members of its Group and is no longer a Leased Employee.

     9.02 Beneficiary. Any benefits payable on account of a Member’s death shall be paid to such Member’s spouse. If such Member has no spouse or if such Member’s spouse shall have consented to the naming of another beneficiary, such benefits shall be paid to the person or persons (including, without limitation, estates, trust, or other entities) last named as beneficiary by such Member on an appropriate form filed with the Committee. A spouse’s consent shall acknowledge the effect of the consent and be in writing, witnessed by a Plan representative or notary public. A spouse’s consent shall be irrevocable. If no beneficiary has been so named or the Member has no designated beneficiary, any payment to be made under this Plan on account of a Member’s death shall be paid to such Member’s spouse, or, if he has no spouse, to such Member’s estate. Whenever permitted by the Code or regulations thereunder, the Committee may waive the requirements that a spouse’s consent be obtained. Such waiver may be on a case by case basis or by categories.

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SECTION 10

Payment of Benefits

     10.01 Time of Payment.

(a) All amounts distributable to a Member or Beneficiary pursuant to Section 9 shall, unless the Member makes an approved election pursuant to Section 10.01(b) or 10.01(c), be paid in a lump sum payment to be made as soon as practicable after the Valuation Date as of which the Account values are determined pursuant to Section 9.01; provided, however, that any additional amounts which may be allocated to a Member’s Company Accounts resulting from a Company Contribution in respect of the calendar year in which employment terminates shall be paid as soon as practicable after such contribution.

     Notwithstanding any provision of this Section 10 to the contrary, if the present value of the nonforfeitable accrued benefit of a Member, including Company Contributions, Member Contributions, Rollover Contributions and earnings thereon (but excluding accumulated deductible employee contributions, if any) exceeds $1,000, no partial or total distribution shall be made unless the Member has consented thereto in writing in the manner required by law.

(b) A Member who was a Member of the CLI Plan as of December 31, 2008, may elect that all Transferred Accounts distributable to him pursuant to Section 9 shall be paid (i) in lump sum or (ii) monthly, quarterly, semi-annual or annual installments over a period not to exceed Member’s assumed life expectancy (or Member and Member’s Beneficiary’s assumed life expectancies) beginning with the Valuation Date as of which the lump sum payment would otherwise be made.

     A Member who was a Member of the May Plan as of June 30, 1990 may elect that all Transferred Accounts distributable to him pursuant to Section 9 shall be paid in annual installments over a period not to exceed ten years beginning with the Valuation Date as of which the lump sum payment would otherwise be made. In the event of the death of a Member prior to the expiration of such period, all amounts which have not been distributed to him shall be paid in a lump sum to his designated Beneficiary or his estate if there is no designated Beneficiary. Subject to the foregoing, each such installment shall be paid as of a Valuation Date and, until all the Accounts of the Member have been fully distributed, they shall continue to be revalued as of each succeeding Valuation Date pursuant to Section 6.04.

     Notwithstanding the above, a Member who as of December 31, 1988 was or was entitled to be a Participant in the Volume Shoe Corporation Profit Sharing Plan may elect that all Transferred Accounts distributable to him pursuant to Section 9 be paid in the form of equal monthly installments over a period not to exceed 120 months. Such payments shall otherwise be made in accordance with the foregoing portion of this Subsection 10.01(b).

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(c) A Member who is entitled to receive a distribution in excess of $1,000 may elect to defer such distribution to the required minimum distribution age, as determined by law from time to time. An election to defer distribution shall conform to such requirements as to form, content, manner, and timing as shall be determined by the Committee and which requirements shall be applied in a manner which does not discriminate in favor of Members who are Highly Compensated Employees. All Accounts of a Member who elects to defer his distribution shall continue to be revalued as of each succeeding Valuation Date pursuant to Section 6.04. A deferred distribution shall be paid when such Member attains the required minimum distribution age or at such earlier or later time as shall be determined by the Committee as permitted by law. In the event of the death of a Member prior to distribution of the deferred amounts, all amounts shall be distributed in a lump sum to his designated Beneficiary or to his estate if there is no designated Beneficiary. The value for payment shall be determined as of the Valuation Date coincident with or next following such Member’s birthday coincident with the Member’s required minimum distribution age or such other payment date determined by the Committee.

     10.02 Form of Payment. All distributions shall be made in the form of cash, except that distributions from the Collective Brands Common Stock Fund shall be made in the form of full shares of Collective Brands Common Stock, as applicable (with payment in cash for a fraction of a share) or in cash if elected by the Member or Beneficiary. The rights extended to a Member hereunder shall also apply to any Beneficiary or alternate payee of such Member.

     10.03 Indirect Payment of Benefits. If any Member or Beneficiary has been adjudged to be legally, physically or mentally incapable or incompetent, payment may be made to the legal guardian or other legal representative of such Member or Beneficiary as determined by the Committee. Such payments shall constitute a full discharge with respect thereto.

     10.04 Inability to Find Member. If a Member or Beneficiary or other person to whom a benefit payment is due cannot be found during the three years subsequent to the date a distribution was required to be made under this Plan, the Accounts shall be forfeited at the end of such three-year period. The value of such Accounts as of the date the distribution was required to be made shall be restored if such Member or Beneficiary or other person makes a claim.

     10.05 Required Minimum Distributions.

     Notwithstanding anything to the contrary contained in the Plan, the entire interest of a Member will be distributed in accordance with Code Section 401(a)(9) and the regulations thereunder beginning no later than the Member’s Required Beginning Date. The provisions of this Section will apply for purposes of determining required minimum distributions for calendar years beginning with the 2003 calendar year. Notwithstanding the other provisions of this Section, distributions may be made under a designation made before January 1, 1984, in accordance with section 242(b)(2) of the Tax Equity and Fiscal Responsibility Act (TEFRA) and the provisions of the Plan that relate to section 242(b)(2) of TEFRA.

(a) If the Member dies before distributions begin, the Member’s entire interest will be distributed, or begin to be distributed, no later than as follows:

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     (1) If the Member’s surviving spouse is the Member’s sole designated beneficiary, then distributions to the surviving spouse will begin by December 31 of the calendar year immediately following the calendar year in which the Member died, or by December 31 of the calendar year in which the Member would have attained age 70¹/2, if later.

     (2) If the Member’s surviving spouse is not the Member’s sole designated beneficiary, then distributions to the designated beneficiary will begin by December 31 of the calendar year immediately following the calendar year in which the Member died.

     (3) If there is no designated beneficiary as of September 30 of the year following the year of the Member’s death, the Member’s entire interest will be distributed by December 31 of the calendar year containing the fifth anniversary of the Member’s death.

     (4) If the Member’s surviving spouse is the Member’s sole designated beneficiary and the surviving spouse dies after the Member but before distributions to the surviving spouse begin, this subsection, other than subsection (a)(1), will apply as if the surviving spouse were the Member.

For purposes of this subsection, unless subsection (a)(4) applies, distributions are considered to begin on the Member’s Required Beginning Date. If subsection (a)(4) applies, distributions are considered to begin on the date distributions are required to begin to the surviving spouse under subsection (a) (1). To the extent the Plan provides for distributions in the form of annuities, if distributions under an annuity purchased from an insurance company irrevocably commence to the Member before the Member’s Required Beginning Date (or to the Member’s surviving spouse before the date distributions are required to begin to the surviving spouse under subsection (a)(1)), the date distributions are considered to begin is the date distributions actually commence.

(b) Unless the Member’s interest is distributed in the form of an annuity purchased from an insurance company or in a single sum on or before the Required Beginning Date, as of the first distribution calendar year distributions will be made in accordance with subsections (c) and (d). To the extent the Plan provides for distributions in the form of annuities, if the Member’s interest is distributed in the form of an annuity purchased from an insurance company, distributions thereunder will be made in accordance with the requirements of Code Section 401(a)(9) and the Treasury regulations.

(c) During the Member’s lifetime, the minimum amount that will be distributed for each distribution calendar year is the lesser of:

     (1) the quotient obtained by dividing the Member’s account balance by the distribution period in the Uniform Lifetime Table set forth in Section 1.401(a)(9)-9 of the Treasury regulations, using the Member’s age as of the Member’s birthday in the distribution calendar year; or

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     (2) if the Member’s sole designated beneficiary for the distribution calendar year is the Member’s spouse, the quotient obtained by dividing the Member’s account balance by the number in the Joint and Last Survivor Table set forth in Section 1.401(a)(9)-9 of the Treasury regulations, using the Member’s and spouse’s attained ages as of the Member’s and spouse’s birthdays in the distribution calendar year.

Required minimum distributions will be determined beginning with the first distribution calendar year and up to and including the distribution calendar year that includes the Member’s date of death.

(d) If the Member dies on or after the date distributions begin and there is a designated beneficiary, the minimum amount that will be distributed for each distribution calendar year after the year of the Member’s death is the quotient obtained by dividing the Member’s account balance by the longer of the remaining life expectancy of the Member or the remaining life expectancy of the Member’s designated Beneficiary, determined as follows:

     (1) The Member’s remaining life expectancy is calculated using the age of the Member in the year of death, reduced by one for each subsequent year.

     (2) If the Member’s surviving spouse is the Member’s sole designated beneficiary, the remaining life expectancy of the surviving spouse is calculated for each distribution calendar year after the year of the Member’s death using the surviving spouse’s age as of the spouse’s birthday in that year. For distribution calendar years after the year of the surviving spouse’s death, the remaining life expectancy of the surviving spouse is calculated using the age of the surviving spouse as of the spouse’s birthday in the calendar year of the spouse’s death, reduced by one for each subsequent calendar year.

     (3) If the Member’s surviving spouse is not the Member’s sole designated beneficiary, the designated beneficiary’s remaining life expectancy is calculated using the age of the beneficiary in the year following the year of the Member’s death, reduced by one for each subsequent year.

If the Member dies on or after the date distributions begin and there is no designated beneficiary as of September 30 of the year after the year of the Member’s death, the minimum amount that will be distributed for each distribution calendar year after the year of the Member’s death is the quotient obtained by dividing the Member’s account balance by the Member’s remaining life expectancy calculated using the age of the Member in the year of death, reduced by one for each subsequent year.

(e) If the Member dies before the date distributions begin and there is a designated beneficiary, the minimum amount that will be distributed for each distribution calendar year after the year of the Member’s death is the quotient obtained by dividing the Member’s account balance by the remaining life expectancy of the Member’s designated beneficiary, determined as provided in subsection (d). If the Member dies before the date

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distributions begin and there is no designated beneficiary as of September 30 of the year following the year of the Member’s death, distribution of the Member’s entire interest will be completed by December 31 of the calendar year containing the fifth anniversary of the Member’s death. If the Member dies before the date distributions begin, the Member’s surviving spouse is the Member’s sole designated beneficiary, and the surviving spouse dies before distributions are required to begin to the surviving spouse under subsection (a)(1), this Section will apply as if the surviving spouse were the Member.

(f) The following definitions shall apply for purposes of this Section:

     (1) Designated beneficiary shall mean the individual who is designated as the beneficiary under the terms of the Plan and is the designated beneficiary under Code Section 401(a)(9) and Section 1.401(a)(9)-1, Q&A-4 of the Treasury regulations.

     (2) A distribution calendar year is a calendar year for which a minimum distribution is required. For distributions beginning before the Member’s death, the first distribution calendar year is the calendar year immediately preceding the calendar year which contains the Member’s Required Beginning Date. For distributions beginning after the Member’s death, the first distribution calendar year is the calendar year in which distributions are required to begin under subsection (a). The required minimum distribution for the Member’s first distribution calendar year will be made on or before the Member’s Required Beginning Date. The required minimum distribution for other distribution calendar years, including the required minimum distribution for the distribution calendar year in which the Member’s Required Beginning Date occurs, will be made on or before December 31 of that distribution calendar year.

     (3) Life expectancy means an individual’s life expectancy as computed by use of the Single Life Table in Section 1.401(a)(9)-9 of the Treasury regulations.

     (4) The Member’s account balance is the account balance as of the last valuation date in the calendar year immediately preceding the distribution calendar year (valuation calendar year) increased by the amount of any contributions made and allocated or forfeitures allocated to the account balance as of dates in the valuation calendar year after the valuation date and decreased by distributions made in the valuation calendar year after the valuation date. The account balance for the valuation calendar year includes any amounts rolled over or transferred to the Plan either in the valuation calendar year or in the distribution calendar year if distributed or transferred in the valuation calendar year.

     (5) Required Beginning Date means the first day of April following the calendar year in which the Member attains age 70¹/2 or, if later, the calendar year in which the Member retires. In the case of a Member who is a “five percent owner” as defined in Section 21.06(f)(2), Required Beginning Date means the

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first day of April following the calendar year in which the Member attains age 70¹/2.

(g) 2009 RMDs. Notwithstanding anything to the contrary in this Section 10.05, a Member, a Member’s surviving spouse or a Member’s sole designated beneficiary who would have been required to receive required minimum distributions under this Section 10.05 for 2009 but for the enactment of Code Section 401(a)(9)(H) (“2009 RMDs”), and who would have satisfied that requirement by receiving distributions that are (i) equal to the 2009 RMDs or (ii) one or more payments in a series of substantially equal distributions (that include the 2009 RMDs) made at least annually and expected to last for the life (or life expectancy) of the Member, the joint lives (or joint life expectancy) of the Member and the Member’s designated beneficiary, or for a period of at least 10 years, will not receive those distributions for 2009 unless the Member or the Member’s designated beneficiary chooses to receive such distributions. Members and designated beneficiaries described in the preceding sentence will be given the opportunity to elect to receive the distributions described in the preceding sentence. In addition, solely for purposes of applying the direct rollover provisions of the Plan, 2009 RMDs will be treated as eligible rollover distributions.

     10.06 Commencement of Benefit Distribution to Beneficiary. Distributions to the Beneficiary entitled under Section 9.02 to receive any payments payable under this Plan on account of a Member’s death shall be made in a lump sum payment not later than December 31 of the calendar year following the calendar year in which the Member died.

     10.07 Commencement of Benefit Distribution to Alternate Payee. Distributions to an alternate payee entitled under Section 17.01 to receive any payments payable under this Plan pursuant to the terms of a Qualified Domestic Relations Order shall be made in accordance with the terms of such Qualified Domestic Relations Order and this Plan on or after the date on which the Member has attained his “earliest retirement age” (as defined under Code Section 414(p)) under the Plan. Notwithstanding the foregoing, distribution to an alternate payee may be made prior to the Member’s attainment of his earliest retirement age if, but only if: (1) the Qualified Domestic Relations Order specifies distribution at that time or permits an agreement between the Plan and the alternate payee to authorize an earlier distribution; (2) the distribution is a single sum distribution of the alternate payee’s entire benefit entitlement under the Plan; and (3) in the event the present value of the alternate payee’s benefits under the Plan exceeds $1,000, the alternate payee consents to any distribution occurring prior to the Member’s attainment of earliest retirement age.

     Nothing in this Section 10.07 shall be construed to permit a Member to (1) receive a distribution at a time not otherwise permitted under the Plan, (2) permit the alternate payee to receive a form of payment not otherwise permitted under the Plan, or (3) cause his Plan accounts to be valued or otherwise determined in a manner not otherwise permitted under the Plan.

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SECTION 11

Permitted Rollover of Plan Distributions

     11.01 Rollover to Other Plans. Notwithstanding any provision of the Plan to the contrary that would otherwise limit a Distributee’s election under this Section, a Distributee may elect, at the time and pursuant to procedures prescribed by the Committee, to have any portion of an Eligible Rollover Distribution paid directly to an Eligible Retirement Plan specified by the Distributee in a direct rollover. Such distribution may commence no less than thirty (30) days nor more than ninety (90) after any notice required under Treas. Reg. Section 1.411(a)-11(c) (or its successor) and explanation of his right to rollover his distribution and tax explanation in accordance with Internal Revenue Rules are given to a Member or other Distributee, provided that the Member has been clearly informed that he has a right to a period of at least thirty (30) days after receiving said notice to consider the decision as to whether to elect a distribution or, if applicable, a distribution option, and the Member nevertheless affirmatively elects distribution preceding the expiration of thirty (30) days. A portion of the distribution shall not fail to be an Eligible Rollover Distribution merely because the portion consists of after-tax Member contributions which are not includible in gross income. However, such portion may be transferred only to (i) an individual retirement account or annuity described in Sections 408(a) or (b) of the Code, or (ii) effective January 1, 2007, a qualified plan described in Section 401(a) of the Code or an annuity contract described in Code Section 403(b) that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not so includible.

     11.02 Rollover from Other Plans. An Associate eligible to participate in the Plan, regardless of whether he has satisfied the participation requirements of Section 2.01, may transfer to the Plan an Eligible Rollover Distribution provided that such distribution is from an Eligible Retirement Plan other than an individual retirement account described in Code Section 408(a) or an individual retirement annuity described in Code Section 408(b); and, provided further, that this Plan shall not accept the portion of any Eligible Rollover Distribution that is not includible in gross income. If such transfer is not a direct transfer, such a transfer may be made only if the following conditions are met:

(a) the transfer occurs on or before the 60^th day following the Associate’s receipt of the distribution from the Eligible Retirement Plan; and

(b) The amount transferred is equal to any portion of the distribution the Associate received from the Eligible Retirement Plan, not in excess of the fair market value of all property received in such a distribution reduced by employee contributions.

The Committee shall develop such procedures, and may require such information, from a Member desiring to make such a transfer, as it deems necessary or desirable to determine that the proposed transfer will meet the requirements of the Section. Upon approval by the Committee or its Administrative Delegate, the amount transferred shall be deposited in the Trust Fund and shall be credited to the Member’s account. Such rollover amount shall be one hundred percent (100%) vested in the Member, shall share in the income

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allocations in accordance with Section 5, but shall not share in the Company Profit Sharing Contributions, the Company Matching Contributions or the forfeiture allocations. Upon termination of employment, the total amount of the rollover contribution shall be distributed in accordance with the terms of the Plan.

Upon such a transfer by an Associate who is otherwise eligible to participate in the Plan but who has not yet completed the participation requirement of Section 2.01, his rollover amount shall represent his sole interest in the Plan until he becomes a Member.

     11.03 Definitions. The following definitions shall apply for the purposes of this Section 11:

(a) Eligible Rollover Distribution. An Eligible Rollover Distribution is any distribution of all or any portion of the balance to the credit of the distributee, except that an Eligible Rollover Distribution does not include: any distribution that is one of a series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the distributee or the joint lives (or joint life expectancies) of the distributee and the distributee’s beneficiary or for a specified period of ten years or more; any distribution to the extent such distribution is required under Code Section 401(a)(9); and any hardship distribution.

(b) Eligible Retirement Plan. An Eligible Retirement Plan is an individual retirement account described in Code Section 408(a), an individual retirement annuity described in Code Section 408(b), an annuity plan described in Code Section 403(a), an annuity contract described in Code Section 403(b), an eligible plan described in Code Section 457(b) maintained by a state, a political subdivision of a state, or any instrumentality of a state or political subdivision of a state, a qualified trust described in Code Section 401(a), which accepts or will make, as applicable, an Eligible Rollover Distribution, or to the extent permitted by and in accordance with the applicable rules under Code Section 408A, a Roth IRA described in Code Section 408A. This definition shall also apply to an Eligible Rollover Distribution to a Member’s surviving spouse, or a former spouse who is an alternate payee under a Qualified Domestic Relations Order.

(c) Distributee. A Distributee includes a Member or former Member. In addition, the Member or former Member’s surviving spouse and the Member’s or former Member’s spouse or former spouse who is the alternate payee under a Qualified Domestic Relations Order, as defined in Code Section 414(p), are Distributees with regard to the interest of the spouse or former spouse. Moreover, for purposes of Section 11.01, a designated non-spouse Beneficiary may be a Distributee, but only with respect to an Eligible Retirement Plan that is an individual retirement account described in Code Section 408(a), an individual retirement annuity described in Code Section 408(b), or to the extent permitted by and in accordance with the applicable rules under Code Section 408A, a Roth IRA described in Code Section 408A.

(d) Direct Transfer. A Direct Transfer is a payment by the Plan to the Eligible Retirement Plan specified by the Distributee as described in Code Section 401(a)(31).

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SECTION 12

Loans

     12.01 Availability of Loans. Loans shall be permitted under this Plan to Members who are employed with the Employer on the date the loan is made (and subject to the terms of this Section 12, to an interested party as defined in Section 3(14) of ERISA, even if such interested party is no longer an Associate) pursuant to a uniform and non-discriminatory policy of the Committee. Any such loan shall be subject to such conditions and limitations as the Committee deems necessary for administrative convenience and to preserve the tax-qualified status of the Plan. Loans are available to Associates who have a Member Rollover Contribution Account.

     12.02 Amount of Loans. No loan to any Associate, Member or Beneficiary may be made to the extent that such loan, when added to the outstanding balance of all other loans to the Associate, Member or Beneficiary, would exceed the lesser of (a) $50,000 reduced by the excess (if any) of the highest outstanding balance of loans during the one-year period ending on the day before the loan is made, over the outstanding balance of loans from the Plan on the date the loan is made, or (b) one-half the present value of the nonforfeitable accrued benefit of the Member. For the purpose of the above limitation, all loans from all plans of the Employer and other members of the Group are aggregated. Furthermore, any loan shall by its terms require that repayment (principal and interest) be amortized in level payments, not less frequently than quarterly, over a period not extending beyond four and one-half years from the date of the loan. If such loan is used to acquire a dwelling unit which within a reasonable time (determined at the time the loan is made) will be used as the principal residence of the Member, the repayment period shall not extend beyond twenty-nine and one-half years from the date of the loan. An assignment or pledge of any portion of the Member’s interest in the Plan and a loan, pledge, or assignment with respect to any insurance contract purchased under the Plan will be treated as a loan under this paragraph.

     12.03 Terms of Loans.

(a) Loans shall be made available to all Associates, Members and Beneficiaries on a reasonably equivalent basis.

(b) Loans shall not be made available to Highly Compensated Employees in an amount greater than the amount made available to other Employees.

(c) Loans must be adequately secured using not more than fifty percent (50%) of the Member’s vested Account balance, and bear a reasonable interest rate as determined from time to time by the Committee.

(d) An Associate or Member loan for less than $1,000 is not permitted; provided, however, that if such Associate or Member also receives a loan from the Puerto Rico Plan, such minimum amount limitation shall not apply.

(e) In the event of a default, foreclosure on the note and attachment of security will not occur until a distributable event occurs under the Plan with respect to the Member.

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(f) All loans shall be made pursuant to a written Member loan program incorporated herein by reference.

(g) Loans are available from the following accounts, and will be withdrawn from the Members accounts in the following hierarchy:

(a) Member Accounts

(b) Vested Company Accounts

(c) Member Rollover Contribution Accounts

(h) Loans will be taken and repaid from and to the Investment Funds on a pro rata basis, except in the case the Member is subject to Section 16 of the Securities Exchange Act of 1934 or has been designated as a “Designated Insider,” in which case such Member’s loan will be taken first from such Member’s Investment Funds other than the Collective Brands Common Stock Fund.

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SECTION 13

Limit on Contributions to the Plan

     This Section 13 is intended to conform the Plan to the requirements of Code Section 415 and limits the contributions that can be made by and for an individual under the Plan.

     13.01 Limit on Contributions. Notwithstanding any provision of the Plan to the contrary:

(a) The amounts allocated to a Member during the Limitation Year under the Plan and allocated to the Member under any other defined contribution plan to which the Employer or any other member of the Group has contributed shall be proportionately reduced, to the extent necessary, so that the Annual Addition does not exceed the least of:

(1) $49,000; or

(2) 100% of the Member’s remuneration from the Employer or any member of the Group during the Limitation Year; or

(3) such other limits set forth in Code Section 415.

The amount set forth in subparagraph (1) above shall automatically be adjusted to reflect adjustments made by applicable law. Remuneration for purposes of this Section and Sections 1.22 and 21.06(g) means remuneration as defined in Treasury Regulation Section 1.415(c)-2(d)(2), plus amounts that would be reported as wages but for an election under Code Section 125(a), 132(f)(4), 402(e)(3), 402(h)(1)(B), 402(k) or 457(b), but not in excess of $245,000 (as adjusted in accordance with Section 415(d) of the Code) for any Limitation Year, Plan Year or calendar year, as applicable. Such amount shall not include any severance pay, whether paid before or after an Associate’s termination of employment, or any other compensation paid after an individual’s termination of employment. Notwithstanding the preceding sentence, to the extent that the following amounts are otherwise included in the definition of remuneration and are paid no later than the later of the date which is 2¹/2 months after termination of employment or the end of the Limitation Year that includes the date of termination of employment, such amounts paid after an Associate’s termination of employment shall be deemed remuneration: regular pay, including compensation for services during regular working hours, overtime, shift differential, commissions, bonuses or other similar payments; payment for unused accrued sick, vacation or other leave, but only if the Associate would have been able to use the leave if employment had continued; and payment received pursuant to a nonqualified deferred compensation plan sponsored by the Employer, but only if the Associate would have received the payment if employment had continued and only to the extent the payment is includible in the Associate’s gross income. The rules described in this Section 13.01(a) with respect to post-employment payments shall not apply to payments to an individual who does not currently perform services for the Employer by reason of qualified military service, to the extent such payments do not exceed the compensation such individual would have received from the Employer if he or she had continued to perform services for the Employer.

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(b) For purposes of this Section, Limitation Year means the 12 month period commencing on January 1 and ending on December 31.

(c) For purposes of this Section, Annual Additions means the sum for the Limitation Year of Employer contributions, Employee contributions (determined without regard to any rollover contributions as defined in Code Sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3) and 457(e)(16), without regard to catch-up contributions under Code Section 414(v) and without regard to Employee contributions to a simplified employee pension plan which are excludible from gross income under Section 408(k)(6) of the Code) and reallocated forfeitures.

     13.02 Adjustment for Excessive Annual Additions.

(a) If, as a result of the allocation of forfeitures, a reasonable error in estimating a Member’s Pay or other limited facts and circumstances, the Annual Additions under this Plan would cause the maximum Annual Additions to be exceeded for any Member, the Committee shall (1) return any Member Contributions credited for the Limitation Year to the extent that the return would reduce the “excess amount” in the Member’s Accounts, (2) hold any “excess amount” remaining after the return of any Member Contributions in a “Section 415 suspense account”, (3) use the “Section 415 suspense account” in the next Limitation Year (and succeeding Limitation Years if necessary) to reduce either Company Contributions for that Member if that Member is covered by the Plan as of the end of the Limitation Year or if such Member is not covered by the Plan at the end of the Limitation Year to reduce Company Contributions for all Members in the Plan, before any Company Contributions or Member Contributions which would constitute Annual Additions are made to the Plan for such Limitation Year, (4) reduce Company Contributions for such Limitation Year by the amount of the “Section 415 suspense account” allocated and reallocated during such Limitation Year. For purposes of (3) above, the Plan may not distribute “excess amounts” to Members or former Members.

(b) For purposes of this Section, “excess amount” for any Member for a Limitation Year shall mean the excess, if any, of (1) the Annual Additions which would be credited to his account under the terms of the Plan without regard to the limitations of Code Section 415 over (2) the maximum Annual Additions determined pursuant to Section 13.01(a).

(c) For purposes of this Section, “Section 415 suspense account” shall mean an unallocated account equal to the sum of “excess amount” for all Members in the Plan during the Limitation Year. The “Section 415 suspense account” shall not share in any earnings or losses of the Trust Fund.

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SECTION 14

Administration of the Plan

     14.01 Plan Administrator. The Company shall be the Plan Administrator of the Plan for purposes of ERISA and shall be a “named fiduciary” as determined in ERISA Section 402(a)(2).

     14.02 Delegation of Authority.

(a) Authority to administer the Plan has been delegated to the Committee and the Administrative Subcommittee, if any, in accordance with Sections 1.44 (Total and Permanent Disability), 4.01 (Member Contributions), 6.01 (Member Accounts), 6.02 (Company Accounts), 6.05 (Member Statements), 8.02 (Authorized Withdrawals), 13.02 (Adjustment for Excessive Annual Additions), 19.02 (Withdrawal of an Employer) and this Section 14.

(b) Authority with respect to the Investment Funds of the Plan has been delegated to the Trustee in accordance with Sections 7.01 (Administrative Expenses), 5.01(c) (Investment Funds), Section 15 (Management of the Trust Fund) and 6.06 (Shares of Collective Brands, Inc. (Collective Brands Stock) in the Collective Brands Common Stock Fund).

(c) Authority to direct the investment of the Plan’s funds has been delegated to the Investment Subcommittee, if any, in accordance with Sections 15.03(b), 15.03(c) and 15.03(d) (Investments and Reinvestments).

(d) The Committee shall also have the authority and discretion to engage an Administrative Delegate who shall perform, without discretionary authority or control, administrative functions within the frame work of policies, interpretations, rules practices and procedures made by the Committee or other Plan Fiduciary. Any action made or taken by the Administrative Delegate may be appealed by an affected Member to the Committee in accordance with the claims review procedure in Section 16.05. Any decisions which call for interpretations of the Plan provisions not previously made by the Committee shall be made only by the Committee. The Administrative Delegate shall not be considered a fiduciary with respect to the services it provides.

     14.03 Committee and Subcommittees.

(a) The Committee may appoint two subcommittees (an “Administrative Subcommittee” and an “Investment Subcommittee”), each Subcommittee to consist of at least three persons, who need not be members of the Board. The Committee and each Subcommittee, if appointed, shall elect from its members a Chairman and a Secretary, and may appoint one or more Assistant Secretaries who may, but need not be, members of the Committee or such Subcommittee, and may employ such agents, such legal counsel and such clerical, medical, accounting, actuarial and other services as it may from time to time deem advisable to assist in the administration of the Plan. The

45

Committee and each Subcommittee may, from time to time, appoint agents and delegate to such agents such duties as it considers appropriate and to the extent that such duties have been so delegated, the agent shall be exclusively responsible for the proper discharge of such duties.

(b) The Administrative Subcommittee shall have the general responsibility for the administration of the Plan and the carrying out of its provisions, and shall have general powers with respect to Plan administration, including, but not limited to, the powers listed in this Section 14.03. The Administrative Subcommittee shall have the discretionary authority to interpret and construe the Plan, the power to establish rules for the administration of the Plan and the transaction of its business, the power to remedy and resolve inconsistencies and omissions, and the power to determine all questions which arise in the administration, interpretation, or application of the Plan, including but not limited to questions regarding the eligibility, status, Account value and any rights of any Member, Beneficiary, and any other person hereunder.

(c) The Investment Subcommittee shall have the powers provided for in Section 15.03(b).

(d) The Committee and each Subcommittee shall act by a majority of its members and the action of such majority expressed by a vote at a meeting, or in writing without a meeting, shall constitute the action of the Committee or such Subcommittee. All decisions, determinations, actions or interpretations with respect to the Plan by the Committee or either Subcommittee and the individual committee or subcommittee members shall be in the Committee’s, Subcommittee’s or individual member’s sole discretion. The decision, determination, action or interpretation of the Committee or either Subcommittee and the respective individual members of the Committee or Subcommittee in respect to all matters within the scope of its authority shall be conclusive and binding on all persons. No member of the Committee or either Subcommittee shall have any liability to any person for any action or omission except each for his own individual willful misconduct. If a Subcommittee is not appointed, the Committee shall exercise such Subcommittee’s authority and perform its duties as described herein.

(e) Nothing in this Section 14 or in any other provision of the Plan shall be deemed to relieve any person who is a fiduciary under the Plan for purposes of ERISA from any responsibility or liability for any responsibility, obligation or duty which Part 4 of Title I of ERISA shall impose upon such person with respect to this Plan.

     14.04 Accounts and Reports. The Committee shall maintain or cause to be maintained accounts reflecting the fiscal transactions of the Plan and shall keep in convenient form such data as may be necessary for the administration of the Plan. The Committee shall prepare annually a report showing in reasonable detail the assets and liabilities of the Plan and setting forth a brief account of the operation of the Plan for the preceding year.

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     14.05 Non-Discrimination. Neither the Committee nor either Subcommittee shall exercise its discretion in such a way as to result in discrimination in favor of officers, shareholders or Highly Compensated Employees.

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SECTION 15

Management of the Trust Fund

     15.01 Use of the Trust Fund. All assets of the Plan shall be held as a Trust Fund in one or more trusts and shall be used to provide the benefits of this Plan. No part of the corpus or income shall be used for, or diverted to, purposes other than for the exclusive benefit of Members and their Beneficiaries under this Plan and administrative expenses of this Plan.

     15.02 Trustees. The Trust Fund may, at the direction of the Company, be divided into one or more separate trusts, each of which may have a separate Trustee appointed from time to time by the Company and subject to removal by the Company. The Trustee or Trustees of each trust shall have complete authority and discretion with respect to the investment and reinvestment of the assets of each trust, subject, however, to (i) the provisions in the Trust Agreements between the Trustee or Trustees and the Company, and (ii) the provisions of this Plan. Any or all of such separate trusts shall be referred to collectively from time to time as the Trust Fund. Any division of the Trust Fund into one or more separate trusts shall be at the direction of the Company.

     15.03 Investments and Reinvestments. The investment and reinvestment of the assets of the Trust Fund shall be in accordance with the following:

(a) The Company shall have the authority to instruct the Trustee or Trustees to accept and follow the instructions of any designated investment manager (within the meaning of ERISA Section 3(38)) with respect to the investment and reinvestment of the assets constituting a money market or stable value fund, a fixed income fund, a common stock fund, or any other Investment Funds the Company may designate.

(b) The Investment Subcommittee shall have the powers, with respect to investment and reinvestment of the assets constituting the Investment Funds, to promulgate limitations, restrictions, rules or guidelines with respect to the investment policies and classes of investments in which the assets of the Investment Funds may be invested or reinvested by the Trustee or Trustees, including any such investments made pursuant to the instructions of any investment manager. In the event an investment manager designated pursuant to Section 15.03(a) resigns or otherwise is unable to act, the Investment Subcommittee shall have such power and authority as otherwise would be exercisable by such Investment Manager.

(c) In the event that the assets of the Trust Fund shall be divided into one or more separate trusts pursuant to the authority provided for in Section 15.02, then the powers of the Investment Subcommittee as provided for in Section 15.03(b) may be exercised with respect to one or more of such trusts within the discretion of the Investment Subcommittee.

(d) The powers of the Investment Subcommittee as provided in Section 15.03(b) may be exercised at any time or from time to time by the Investment Subcommittee within the discretion of the Investment Subcommittee and shall be pursuant to a written

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agreement between the Investment Subcommittee and the Trustee or Trustees or, if an investment manager has been appointed, between the Investment Subcommittee and the investment manager.

(e) The Trust Agreement between the Company and the Trustee or Trustees implementing the Plan shall contain provisions effectuating the provisions of this Section 15 of the Plan.

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SECTION 16

Certain Rights and Obligations of Employers and Members

     16.01 Disclaimer of Employer Liability.

(a) No liability shall attach to any Employer with respect to a benefit or claim hereunder and Members and their Beneficiaries, and all persons claiming under or through them, shall have recourse only to the Trust Fund for payment of any benefit hereunder.

(b) The rights of the Members, their Beneficiaries and other persons are hereby expressly limited and shall be only in accordance with the provisions of the Plan. Nothing contained herein shall be deemed to give a Member any interest in any specific property of the Trust or any interest other than a right to receive payments pursuant to the provisions of the Plan.

     16.02 Employer-Associate Relationship. Neither the establishment of this Plan nor its communication through a Summary Plan Description (or otherwise) shall be construed as conferring any legal or other rights upon any Associate or any other person to continue in employment or as interfering with or affecting in any manner the right of an Employer to discharge any Associate or otherwise act with relation to him. Each Employer may take any action (including discharge) with respect to any Associate or other person and may treat him without regard to the effect which such action or treatment might have upon him as a Member of this Plan.

     16.03 Binding Effect. Each Member, by executing an enrollment form, beneficiary designation and otherwise agreeing to participate in the Plan agrees for himself, his beneficiary(ies), heirs, successors and assigns to be bound by all of the provisions of the Plan.

     16.04 Corporate Action. With respect to any action permitted or required by the Plan, the Company may act through its appropriate officers.

     16.05 Claim and Appeal Procedure. A Member or Beneficiary or other person who believes that he is being denied a benefit to which he is entitled (hereinafter referred to as “Claimant”) may file a written request for such benefit with the Committee, setting forth his or her claim. The request must be addressed to: The Committee, Collective Brands 401(k) Profit Sharing Plan, 3231 SE Sixth Avenue, Topeka, KS 66607. Notwithstanding anything in the Plan to the contrary, a claim must be filed within one year from the date such claim first accrues or the Claimant will be forever barred from pursuing such claim. A claim by a Claimant shall be deemed to have accrued on the earlier of (i) the date the Claimant’s benefits commence or (ii) the date the Claimant became aware, or should have become aware, that his or her position regarding his or her entitlement to benefits is different from the Plan’s or the Company’s position regarding the Claimant’s entitlement to benefits.

(a) Claim Decision. Upon receipt of a claim, the Committee shall advise the Claimant that a reply will be forthcoming within 90 days and shall in fact deliver such

50

reply in writing within such period. The Committee may, however, extend the reply period for an additional 90 days for reasonable cause. If the reply period will be extended, the Committee shall advise the Claimant in writing during the initial 90-day period indicating the special circumstances requiring an extension and the date by which the benefit determination is expected. If the claim is denied in whole or in part, the Committee will render a written opinion using language calculated to be understood by the Claimant setting forth:

(i) the specific reason or reasons for the denial;

(ii) specific references to pertinent Plan provisions on which the denial is based;

(iii) a description of any additional material or information necessary for the Claimant to perfect the claim and an explanation why such material or such information is necessary;

(iv) appropriate information as to the steps to be taken if the Claimant wishes to submit the claim for review, including a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse benefit determination on review; and

(v) the time limits for requesting a review of the denial and for the actual review of the denial.

(b) Request For Review. Within 60 days after the receipt by the Claimant of the written opinion described above, the Claimant may request in writing that the committee, which shall be comprised of up to three individuals (which may include members of the Committee) appointed by the Company or by the Committee, review the determination of the Committee. Such request must be addressed to: The Committee, Collective Brands 401(k) Profit Sharing Plan, 3231 SE Sixth Avenue, Topeka, KS 66607. The Claimant or his or her duly authorized representative may submit written comments, documents, records or other information relating to the denied claim, which shall be considered in the review under this subsection without regard to whether such information was submitted or considered in the initial benefit determination.

     The Claimant or his or her duly authorized representative shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information which (i) was relied upon by the Committee in making its initial claims decision, (ii) was submitted, considered or generated in the course of making the initial claims decision, without regard to whether such instrument was actually relied upon in making the decision or (iii) demonstrates compliance by the Committee with its administrative processes and safeguards designed to ensure and to verify that benefit claims determinations are made in accordance with governing Plan documents and that, where appropriate, the Plan provisions have been applied consistently with respect to similarly situated claimants. If the Claimant does not request a review of the

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Committee’s determination by the committee within such 60-day period, he shall be barred and estopped from challenging the Committee’s determination.

(c) Review Of Decision. Within a reasonable period of time, ordinarily not later than 60 days, after the committee’s receipt of a request for review, it will review the prior determination. If special circumstances require that the sixty (60) day time period be extended, the committee will so notify the Claimant within the initial sixty (60)-day period indicating the special circumstances requiring an extension and the date by which the committee expects to render its decision on review, which shall be as soon as possible but not later than one hundred twenty (120) days after receipt of the request for review. In the event that the committee extends the determination period on review due to a Claimant’s failure to submit information necessary to decide a claim, the period for making the benefit determination on review shall not take into account the period beginning on the date on which notification of extension is sent to the Claimant and ending on the date on which the Claimant responds to the request for additional information.

     The committee has discretionary authority to determine a Claimant’s eligibility for benefits and to interpret the terms of the Plan. Benefits under the Plan will be paid only if the committee decides in its discretion that the Claimant is entitled to such benefits. The decision of the committee shall be final and non-reviewable, unless found to be arbitrary and capricious by a court of competent review. Such decision will be binding upon the Company and the Claimant.

     If the committee makes an adverse benefit determination on review, the committee will render a written opinion, using language calculated to be understood by the Claimant, setting forth:

(i) the specific reason or reasons for the denial;

(ii) the specific references to pertinent Plan provisions on which the denial is based;

(iii) a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information which (A) was relied upon by the committee in making its decision, (B) was submitted, considered or generated in the course of the committee making its decision, without regard to whether such instrument was actually relied upon by the committee in making its decision or (C) demonstrates compliance by the committee with its administrative processes and safeguards designed to ensure and to verify that benefit claims determinations are made in accordance with governing Plan documents, and that, where appropriate, the Plan provisions have been applied consistently with respect to similarly situated claimants; and

(iv) a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following the adverse benefit determination on such review.

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     16.06 Venue for Litigation. In light of the Plan Administrator’s substantial contacts with the State of Kansas, the fact that the Plan Administrator resides in Kansas and the Company is headquartered in Topeka, Kansas, and the Company’s establishment of, and the Plan Administrator’s maintenance of, this Plan in Kansas, any cause of action brought by a Claimant, Associate, Member, former Associate, former Member or any beneficiary of such an individual involving benefits under the Plan shall be filed and conducted exclusively in the federal courts in the District of Kansas.

     No action at law or in equity shall be brought to recover under the Plan prior to the expiration of 60 days after receipt by the Claimant of the written decision regarding the Claimant’s request for review under the claims procedure, nor shall such action be brought at all unless within three years from receipt by the Claimant of such written decision by the final claims reviewer under the claims procedure.

     16.07 Acquisition Of Assets. If the Employer acquires the assets (through purchase, merger or otherwise) of any other entity and hires persons who had been employed by such entity, the division or other subgroup in which such persons are employed shall be excluded from the groups included in the definition of “Associate” unless the Company communicates to such division or subgroup that such division or subgroup is accruing benefits under the Plan.

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SECTION 17

Non-Alienation of Benefits

     17.01 Provisions with Respect to Assignment and Levy. No benefit payable under this Plan shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, levy or charge, and any attempt so to anticipate, alienate, sell, transfer, assign, encumber, levy upon or charge the same shall be void; nor shall any such benefit be in any manner liable for or subject to the debts, contracts, liabilities, engagements or torts of the person entitled to such benefit, except as specifically provided herein. Notwithstanding the foregoing, the creation, assignment, or recognition of a right to any benefit payable to an alternate payee with respect to a Qualified Domestic Relations Order shall not be treated as an assignment or alienation prohibited by this Section. Any other provision of the Plan to the contrary notwithstanding, if a Qualified Domestic Relations order requires the distribution of all or part of a Member’s benefits under the Plan, the establishment or acknowledgment of the alternate payee’s right to benefits under the Plan in accordance with the terms of such Qualified Domestic Relations Order shall in all events be deemed to be consistent with the terms of the Plan.

     Notwithstanding the above a Member’s benefit will be offset against any amount he or she is ordered or required to pay to the Plan pursuant to an order or requirement which arises under a judgment of conviction for a crime involving the Plan, under a civil judgment entered by a court in an action involving a fiduciary breach, or pursuant to a settlement agreement between the Member and the Department of Labor or the Pension Benefit Guaranty Corporation. Any such offset shall be made pursuant to Section 206(d) of ERISA.

     17.02 Alternate Application. If a Member or Beneficiary under this Plan becomes bankrupt or attempts to anticipate, alienate, sell, transfer, assign, pledge, encumber or charge any benefit under this Plan, except as specifically provided herein, or if any benefit shall, in the discretion of the Committee, cease, and in that event the Committee may hold or apply the same or any part thereof to or for the benefit of such Member or Beneficiary, his spouse, children or other dependents, or any of them, or in such other manner and in such proportion as the Committee may deem proper.

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SECTION 18

Amendments

     18.01 Company’s Rights. The Company reserves the right at any time and from time to time in its sole discretion to alter, amend, or modify, in whole or in part, any or all of the provisions of this Plan, provided, however, no such alteration, amendment or modification shall be made which shall decrease the accrued benefit of any Member. Anything in this Plan to the contrary notwithstanding, the Company in its sole discretion may make any modifications or amendments, additions or deletions in or to this Plan as to benefits or otherwise and retroactively if necessary, and regardless of the effect thereof on the rights of any particular Member or Beneficiary, which it deems appropriate and/or necessary in order to comply with or satisfy any conditions of any law or regulation relating to the qualification of this Plan and the trust or trusts created pursuant hereto and to keep this Plan and said trusts qualified under Code Section 401(a) and to have the trust or trusts declared exempt from taxation under Code Section 501(a).

     18.02 Procedure to Amend. This Plan may be amended by action of the Company’s Board of Directors and evidenced by a written amendment signed by the Company’s Secretary or by any other person so authorized by or pursuant to authority of the Board of Directors.

     18.03 Provision Against Diversion. No part of the assets of the Trust Fund shall, by reason of any modification or amendment or otherwise, be used for, or diverted to, purposes other than for the exclusive benefit of Members and their Beneficiaries under this Plan and administrative expenses of this Plan.

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SECTION 19

Termination

     19.01 Right to Terminate. The Company reserves the right to terminate this Plan, in whole or in part, at any time and, if this Plan shall be terminated either in its entirety or with respect to any Employer included hereunder, the provisions of Section 19.03 shall apply and the Accounts of affected Members shall become (or remain) fully vested and nonforfeitable.

     19.02 Withdrawal of an Employer. If an Employer shall cease to be a participating Employer in this Plan, the Trust Fund and the Accounts of the Members of the withdrawing Employer and their Beneficiaries shall be revalued as if such withdrawal date were a Valuation Date. The Committee shall then direct the Trustee either to distribute the Accounts of the Members of the withdrawing Employer as of the date of such withdrawal on the same basis as if the Plan had been terminated pursuant to Section 19.03 or to deposit in a trust established by the withdrawing Employer pursuant to a plan substantially similar to this Plan assets equal in value to the assets of the Trust Fund allocable to the Accounts of the Members of the withdrawing Employer.

     19.03 Distribution in Event of Termination of Trust. If this Plan is terminated at any time including a partial termination as defined in Code Section 411(d)(3), or if contributions are completely discontinued and the Company determines that the trust shall be terminated, in whole or in part, the Trust Fund and all Accounts shall be revalued as if the termination date were a Valuation Date and the affected Members’ Accounts shall be distributed in accordance with Section 10.

     19.04 Administration in Event of Continuance of Trust. If this Plan shall be terminated in whole or in part or contributions completely discontinued but the Company determines that the trust shall be continued pursuant to the terms of the Trust Agreement, the trust shall continue to be administered as though the Plan were otherwise in effect. Upon the subsequent termination of the trust, in whole or in part, the provisions of Section 19.03 shall apply.

     19.05 Merger, Consolidation or Transfer. In the case of any merger or consolidation with, or transfer of Plan assets or liabilities to, any other plan, each Member shall be entitled to receive a benefit immediately after the merger, consolidation or transfer (if the transferee plan then terminated) which is equal to or greater than the benefit he would have been entitled to receive immediately before the merger, consolidation or transfer (if the Plan had then terminated).

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SECTION 20

Construction

     20.01 Applicable Law. The provisions of this Plan except as otherwise governed by ERISA shall be construed, regulated, administered and enforced according to the laws of the State of Kansas and, whenever possible, to be in conformity with the applicable requirements of ERISA and the Internal Revenue Code.

     20.02 Gender and Number. Wherever applicable, the masculine pronoun as used herein shall include the feminine pronoun and the singular pronoun shall include the plural.

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SECTION 21

Top-Heavy Requirements

     21.01 Generally. For any Plan Year in which the Plan is a Top-Heavy Plan, the provisions of Section 21.02 shall automatically take effect in accordance with Code Section 416.

     21.02 Minimum Allocations.

(a) Minimum Employer Allocations and allocations of Plan forfeitures for a Member who is not a Key Employee shall be required under the Plan for the Plan Year as set forth in Section 21.02(b) and (c).

(b) The amount of the minimum allocation shall be the lesser of the following, percentages of Top-Heavy Compensation: (i) three percent (3%) or, (ii) the highest percentage at which such allocations are made under the Plan for the Plan Year on behalf of a Key Employee. For purposes of this paragraph (b), all defined contribution plans required to be included in an Aggregation Group shall be treated as one plan. This paragraph (b) shall not apply if the Plan is required to be included in an Aggregation Group and the Plan enables a defined benefit plan required to be included in the Aggregation Group to meet the requirement of Code Sections 401(a)(4) or 410. For purposes of this paragraph (b), the calculation of the percentage at which allocations are made for a Key Employee shall be based only on his Top-Heavy Compensation not in excess of $225,000, such amount to be adjusted periodically for increases in the cost of living in accordance with Code Section 401(a)(17). The minimum allocation described in this paragraph (b) shall be in addition to (and shall not be reduced by) any Member Contributions under Section 4 (whether Before-Tax or After-Tax).

(c) For purposes of this Section 21.02, the term “Member” shall be deemed to refer to all Members who have not separated from service at the end of the Plan Year including, without limitation, individuals who declined to make contributions to the Plan.

     12.03 Determination of Top Heaviness.

(a) The determination of whether a plan is Top-Heavy shall be made in accordance with paragraphs (b) through (d) of this Section 21.03.

(b) If the Plan is not required to be included in an Aggregated Group with other plans, then it shall be Top-Heavy only if when considered by itself, it is a Top-Heavy Plan and it is not included in a permissive Aggregation Group that is not a Top-Heavy Group.

(c) If the Plan is required to be included in an Aggregation Group with other plans, it shall be Top-Heavy only if the Aggregation Group, including any permissively aggregated plans, is Top-Heavy.

(d) If a plan is not a Top-Heavy Plan and is not required to be included in an Aggregation Group, then it shall not be Top-Heavy even if it is permissively aggregated in an Aggregation Group which is a Top-Heavy Group.

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     21.04 Calculation of Top-Heavy Ratios. A plan shall be Top-Heavy and an Aggregation Group shall be a Top-Heavy Group with respect to any Plan Year as of the Determination Date if the sum as of the Determination Date of the Cumulative Accrued Benefits and the Cumulative Accounts of Employees who are Key Employees for the Plan Year exceeds 60 percent (60%) of a similar sum determined for all Employees, excluding former Key Employees.

     21.05 Cumulative Accounts and Cumulative Accrued Benefits.

(a) The Cumulative Accounts and Cumulative Accrued Benefits for any Employee shall be determined in accordance with paragraphs (b) through (e) of this Section 21.05.

(b) Cumulative Account shall mean the sum of the amount of an Employee’s accounts under a defined contribution plan (for an unaggregated plan) or under all defined contribution plans included in an Aggregation Group (for aggregated plans) determined as of the most recent plan Valuation Date within a 12-month period ending on the Determination Date, increased by any allocations due after such Valuation Date and before the Determination Date.

(c) Cumulative Accrued Benefit means the sum of the present value of an Employee’s accrued benefits under a defined benefit plan (for an unaggregated plan) or under all defined benefit plans included in an Aggregation Group (for aggregated plans), determined under the actuarial assumptions set forth in such plan or plans, as of the most recent plan Valuation Date within a 12-month period ending on the Determination Date as if the Employee voluntarily terminated service as of such Valuation Date.

(d) Accounts and benefits shall be calculated to include all amounts attributable to both Matching Allocations and Employee contributions but excluding amounts attributable to voluntary deductible Employee contributions.

(e) Accounts and benefits shall be increased by the aggregate distributions during the one-year period ending on the Determination Date made with respect to an Employee under the plan or plans as the case may be or under a terminated plan which, if it had not been terminated, would have been required to be included in the Aggregation Group. In the case of a distribution made for a reason other than severance from employment, death, or disability, this provision shall be applied by substituting “five-year period” for “one-year period.

(f) Rollovers and direct plan-to-plan transfers shall be handled as follows:

(i) If the transfer is initiated by the Employee and made from a plan maintained by one Employer to a plan maintained by another Employer, the transferring plan continues to count the amount transferred under the rules for counting distributions. The receiving plan does not count the amount if accepted after December 31, 1983, but does count it if accepted prior to December 31, 1983.

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(ii) If the transfer is not initiated by the Employee or is made between plans maintained by the Employers, the transferring plan shall no longer count the amount transferred and the receiving plan shall count the amount transferred.

(iii) For purposes of this subsection (f), all Employers aggregated under the rules of Code Sections 414(b), (c) and (m) shall be considered a single employer.

(g) The accrued benefits and accounts of any individual who has not performed services for the Employer during the one-year period ending on the Determination Date shall not be taken into account.

     21.06 Other Definitions.

(a) Solely for purposes of this Section 21, the definitions in paragraphs (b) through (g) of this Section 21.06 shall apply, to be interpreted in accordance with the provisions of Code Section 416 and the regulations thereunder.

(b) Aggregation Group means a plan or group of plans which included all plans maintained by the Employer in which a Key Employee is a participant or which enables any plan in which a Key Employee is a participant to meet the requirements of Code Section 401(a)(4) or Code Section 410, as well as all other plans selected by the Company for permissive aggregation, the inclusion of which would not prevent the group of plans from continuing to meet the requirements of such Code sections.

(c) Determination Date means, with respect to any Plan Year, the last day of the preceding Plan Year.

(d) Employee means any person employed by an Employer and shall also include any Beneficiary of such persons, provided that the requirements of Section 21.02 shall not apply to any person included in a unit of Employees covered by an agreement which the Secretary of Labor finds to be a collective bargaining agreement between Employee representatives and one or more Employers if there is evidence that retirement benefits were the subject of good faith bargaining between such Employee representatives and such Employer or Employers.

(e) Employer means any corporation which is a member of the Group,

(f) Key Employee means any Employee or former Employee (including any deceased Employee) who is, at any time during the Plan Year which includes the Determination Date, any one or more of the following: (1) an officer of an Employer who has annual Pay of more $160,000 (as adjusted under Code Section 416(i)(1)); (2) any person owning (or considered as owning within the meaning of the Code Section 318) more than five percent of the outstanding stock of an Employer or stock possessing more than five percent of the total combined voting power of such stock; (3) a person who would be described in subsection (2) above if “one percent” were substituted for “five percent” each place it appears in subsection (2) above, and who has annual Pay of more than $150,000 (for purposes of determining ownership under this subsection, Code

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Section 318(a)(2)(C) shall be applied by substituting “five percent” for “50 percent” and the rules of subsections (b), (c) and (m) of Code Section 414 shall not apply).

(g) Top-Heavy Compensation means the remuneration as defined in Section 13.01(a). Such compensation shall be considered only if earned while a Member.

     IN WITNESS WHEREOF, the Company has caused this amended Plan to be executed by a duly authorized officer this 10th day of August, 2011.

COLLECTIVE BRANDS, INC.
By:	/s/ Betty J. Click

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EX-4.2

Exhibit 4.2

COLLECTIVE BRANDS PERFORMANCE + LIFESTYLE GROUP

EMPLOYEE SAVINGS & INVESTMENT PLAN

Amended and Restated

Effective as of October 1, 2011

RESTATEMENT OF THE
COLLECTIVE BRANDS PERFORMANCE + LIFESTYLE GROUP
EMPLOYEE SAVINGS & INVESTMENT PLAN

          WHEREAS, The Stride Rite Corporation (“Plan Sponsor”) previously adopted the Collective Brands Performance + Lifestyle Group Employee Savings & Investment Plan (“Plan”); and

          WHEREAS, the Plan Sponsor retained the right to amend the Plan pursuant to Section 8.01 thereof; and

          WHEREAS, the Plan Sponsor desires to amend the Plan to add a company stock fund as an investment option, to permit the Plan Sponsor to limit the future tax deferred contributions a participant may invest in the company stock fund, and to clarify certain other provisions, effective as of the dates indicated herein; and

          WHEREAS, the Plan Sponsor desires to amend the Plan in its entirety effective October 1, 2011;

          NOW, THEREFORE, effective October 1, 2011, except as otherwise provided, the Plan is amended in its entirety to read as follows:

Table of Contents

	Page
ARTICLE I — THE PLAN		1
1.01. Creation of the Plan		1
1.02. Interpretation of Plan and Trust		1
1.03. Purposes of the Plan		1
1.04. Effective Dates		2
1.05. Transfers to Savings Plan II		2
1.06. Transfers from Savings Plan II		2
ARTICLE II — DEFINITIONS		4
2.01. “Account”		4
2.02. “Affiliated Company”		4
2.03. “After-Tax Contributions”		4
2.04. “Agreement”		4
2.05. “Anniversary Date”		4
2.06. “Beneficiary”		4
2.07. “Board of Directors”		5
2.08. “Committee”		5
2.09. “Company”		5
2.10. “Compensation”		5
2.11. “Eligible Employee”		6
2.12. “Employee”		6
2.13. “Entry Date”		7
2.14. “Highly Compensated Employee”		7
2.15. “Hour of Service”		7
2.16. “Investment Fund” or “Investment Funds”		8
2.17. “Matching Contributions”		8
2.18. “Maternity/Paternity Leave of Absence”		8
2.19. “Normal Retirement Age”		9
2.20. “One-Year Break in Service”		9
2.21. “Participant”		9
2.22. “Plan”		9
2.23. “Plan Sponsor”		9
2.24. “Plan Year”		9
2.25. “Salary Reduction/Deduction Agreement”		9
2.26. “Tax Deferred Contributions”		9
2.27. “Total Compensation”		10
2.28. “Trust”		10
2.29. “Trust Agreement”		10
2.30. “Trustee”		10
2.31. “Valuation Date”		10
2.32. “Year of Eligibility Service”		11
2.33. “Year of Vesting Service”		11

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	Page
ARTICLE III — PARTICIPATION		12
3.01. Eligibility for Participation		12
3.02. Determination of Eligibility by Committee		12
3.03. Duration of Eligibility		13
3.04. Salary Reduction/Deduction Agreement		13
3.05. Military and Unpaid Leaves of Absence		15
ARTICLE IV — CONTRIBUTIONS UNDER THE PLAN		17
4.01. Tax Deferred Contributions		17
4.02. After-Tax Contributions		17
4.03. Matching Contributions		17
4.04. Payment of Contributions		17
4.05. Reversion of Certain Contributions Made by the Company		18
4.06. Rollover Contributions		18
4.07. Catch-Up Contributions		19
ARTICLE V — PARTICIPANT’S ACCOUNTS; ALLOCATION OF ASSETS AND CONTRIBUTIONS; PARTICIPANTS’ INVESTMENT ELECTIONS		21
5.01. Participants’ Accounts		21
5.02. Allocation of Tax Deferred Contributions		21
5.03. Allocation of After-Tax Contributions		22
5.04. Allocation of Matching Contributions		22
5.05. Allocation of Rollover Contributions		22
5.06. Valuation of Assets		23
5.07. Distributions and Forfeitures		23
5.08. Election of Investments		24
5.09. Shares of Collective Brands, Inc. (“Collective Brands Stock”) in the Collective Brands Common Stock Fund		25
ARTICLE VI — LIMITATIONS ON CONTRIBUTIONS AND ALLOCATIONS		28
6.01. Contributions to be Deductible		28
6.02. Limitation on Tax Deferred Contributions		28
6.03. Return of Excess Deferrals		32
6.04. Limitation on Matching and After-Tax Contributions		32
6.05. Limitations on Allocations		37
ARTICLE VII — PAYMENTS TO OR FOR THE ACCOUNT OF PARTICIPANTS OR TERMINATED PARTICIPANTS		40
7.01. Restrictions on Payments and Distributions		40
7.02. Retirement from Employment		40
7.03. Disability Retirement		40
7.04. Death Benefits		41
7.05. Termination of Employment Prior to Retirement or Death		43
7.06. Reemployment		44
7.07. Manner and Timing of Distributions		44
7.08. Withdrawals During Employment		49
7.09. Loans to Participants		53

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	Page
7.10. Payments to Incompetents		55
7.11. Discharge of Obligation to Make Payments		56
7.12. Direct Rollovers		56
7.13. Notification Of Eligibility To Receive And Consent To Vested Benefits		58
7.14. Written Explanation Of Rollover Treatment		59
ARTICLE VIII — AMENDMENT AND TERMINATION		60
8.01. Right to Amend or Terminate		60
8.02. Amendment for Tax Exemption		60
8.03. Liquidation of Trust in Event of Termination		60
8.04. Termination of Plan and Trust		61
ARTICLE IX — ADMINISTRATION OF THE PLAN		62
9.01. Named Fiduciaries		62
9.02. Appointment of Committee		63
9.03. Powers of Committee		63
9.04. Action by Committee		64
9.05. Discretionary Action		64
9.06. Evidence on Which Committee May Act		65
9.07. Employment of Agents		65
9.08. Compensation and Expense of Committee		66
9.09. Indemnification of Committee Members		66
9.10. Review of Domestic Relations Orders		66
ARTICLE X — TRUST FUND		68
10.01. Trust Agreement		68
10.02. Combined Trust		68
10.03. Transfer from Other Plans		68
ARTICLE XI — THE COMPANY		69
11.01. No Contract of Employment		69
11.02. No Contract to Maintain Plan		69
11.03. Liability of the Company		69
11.04. Action by the Company		69
11.05. Successor to Business of the Company		70
11.06. Dissolution of the Company		70
ARTICLE XII — ADDITIONAL PARTICIPATING COMPANIES		71
12.01. Participation		71
12.02. Effective Date		71
12.03. Administration		71
12.04. Termination		71
ARTICLE XIII — TOP-HEAVY PROVISIONS		72
13.01. General Rule		72
13.02. Minimum Contribution Provisions		72
13.03. Top-Heavy Plan Definition		73

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	Page
13.04. Former Key Employee		75
13.05. Key Employee		76
13.06. Non-Key Employee		76
13.07. Termination of Top-Heavy Status		76
ARTICLE XIV — MISCELLANEOUS		77
14.01. Spendthrift Provision		77
14.02. Appointment of Person to Receive Payment		77
14.03. Construction		78
14.04. Impossibility of Performance		78
14.05. Definition of Words		78
14.06. Titles		78
14.07. Merger or Consolidation		78
14.08. Claims Procedure		79
14.09. Special Disability Provisions		83
14.10. Special Provisions for Certain Leased Employees		85
14.11. Execution of Plan		86
14.12. USERRA		86
14.13. Death During Qualified Military Service		86
14.14. Venue for Litigation		86
14.15. Acquisition Of Assets		87
14.16. Contribution On Behalf Of Affiliated Company		87
14.17. Separability Of Provisions		87
14.18. Service Of Process		87
ARTICLE XV — MINIMUM DISTRIBUTION REQUIREMENTS		88
15.01. General Rules		88
15.02. Time and Manner of Distribution		89
15.03. Required Minimum Distributions During Participant’s Lifetime		90
15.04. Required Minimum Distributions After Participant’s Death		91
15.05. Definitions		93
15.06. 2009 RMDs		94
APPENDIX A		96
EXHIBIT A		97

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COLLECTIVE BRANDS PERFORMANCE + LIFESTYLE GROUP
EMPLOYEE SAVINGS & INVESTMENT PLAN

Amended and Restated as of October 1, 2011

ARTICLE I — THE PLAN

     1.01. Creation of the Plan. There has been hereby established a profit-sharing plan known as the “COLLECTIVE BRANDS PERFORMANCE + LIFESTYLE GROUP EMPLOYEE SAVINGS & INVESTMENT PLAN” (the “Plan”).

     The Plan is amended and restated to add a company stock fund as an investment option, to permit the Company to limit the future tax deferred contributions a participant may invest in the company stock fund, and to clarify certain other provisions.

     1.02. Interpretation of Plan and Trust. The Plan and Trust are established for the exclusive benefit of the Eligible Employees and their Beneficiaries. So far as possible, this Agreement shall be interpreted in a manner consistent with this intent and with the intent of the Company that the Trust established hereunder shall continue to be a profit sharing plan and to satisfy those provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”) and of the Internal Revenue Code of 1986 (the “Code”) relating to exempt employees’ trusts, as either of them may from time to time be amended. Except as otherwise provided in Section 4.05 hereof, under no circumstances shall any property, whether corpus or income of the Trust hereunder, or any funds contributed to the Trust, ever revert to or be used or enjoyed by the Company or be used for any purpose other than for the exclusive benefit of the Eligible Employees or their Beneficiaries.

     1.03. Purposes of the Plan. The primary purpose of the Plan is to provide Eligible Employees with an opportunity to accumulate savings by means of salary adjustment arrangements and to assist them in obtaining additional security for their retirement. In order to

encourage Eligible Employees to save through salary adjustment, the Company will make a contribution to the Plan which is designed primarily to provide additional funds to be available to the Employee upon retirement, death, or total and permanent disability. Although the primary purpose of the Plan is to provide a means for long-range savings, in certain circumstances the Plan permits withdrawals of contributions during employment.

     1.04. Effective Dates. The effective date of the Plan as restated in its entirety herein is October 1, 2011, except as otherwise expressly provided herein (the “Effective Date”).

     The provisions of this restated Plan shall apply to Participants of the Plan who are credited with at least one (1) Hour of Service on or after the Effective Date. Except as otherwise expressly provided herein, the rights of Participants who are not credited with any Hours of Service on or after the Effective Date shall be governed by the provisions of the Plan as in effect prior to the Effective Date.

     1.05. Transfers to Savings Plan II. Any Accounts maintained for an individual who was a Participant in the Plan prior to January 1, 1995 and who as of January 1, 1995, became covered under The Stride Rite Corporation Employee Savings and Investment Plan II, formerly The Stride Rite Corporation Retail Employee Savings and Investment Plan (the “Savings Plan II”), were transferred to the Savings Plan II in June, 2000. As a result of such transfer, the rights of any individual who was a Participant in the Plan prior to January 1, 1995 but who became a participant in the Savings Plan II commencing January 1, 1995 shall be governed by the provisions of the Savings Plan II.

     1.06. Transfers from Savings Plan II. Effective as of January 1, 2007, or as soon as practicable thereafter, all assets in The Stride Rite Corporation Employee Savings and Investment Plan II (‘Plan II’) shall be transferred to and merged with this Plan and all

2

participants in Plan II on December 31, 2006 shall be automatically enrolled in this Plan on January 1, 2007. As a result of such transfer, the rights of all participants in Plan II shall henceforth be governed by the provisions of this Plan. All references to “Former Saucony Employees” in Exhibit A to the Plan shall be read to include participants in Plan II who were formerly participants in the Saucony, Inc. 401(k) Plan. All accounts transferred from Plan II shall be maintained in accounts of the same type in this Plan.

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ARTICLE II — DEFINITIONS

     Whenever used in this Agreement, unless the context clearly indicates otherwise, the following words shall have the following meanings:

     2.01. “Account” means each of the bookkeeping accounts maintained to reflect a Participant’s interest under the Plan and his share of the Trust. A Participant may have several Accounts to reflect his interest attributable to various types of contributions under the Plan as more fully described in Section 5.01.

     2.02. “Affiliated Company” means a corporation which, together with the Company, is a member of a controlled group of corporations (as defined in Section 414(b) of the Code), (b) a trade or business (whether or not incorporated) which is under common control (as defined in Section 414(c) of the Code) with the Company, (c) a corporation, partnership, or other entity which, together with the Company, is a member of an affiliated service group (as defined in Section 414(m) of the Code), or (d) any entity required to be aggregated with the Company under Section 414(o) of the Code. For purposes of determining whether an Employee has met the eligibility requirements of Section 3.01, all periods of employment with the Company and with an Affiliated Company shall be recognized.

     2.03. “After-Tax Contributions” means the contributions made by a Participant pursuant to Section 4.02.

     2.04. “Agreement” means this Agreement, as amended from time to time.

     2.05. “Anniversary Date” means December 31 in each year.

     2.06. “Beneficiary” means the person or persons designated by a Participant, pursuant to the provisions of Section 7.04 of this Agreement, to receive distribution of such Participant’s share upon his death, and includes a co-beneficiary or a contingent beneficiary. The term

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     “Beneficiary” also includes a Participant’s surviving spouse if such spouse is deemed to be such Participant’s Beneficiary pursuant to Section 7.04.

     2.07. “Board of Directors” means the board of directors of the Company in office from time to time.

     2.08. “Committee” means the administrative committee constituted under Article IX of this Agreement in office from time to time.

     2.09. “Company” means The Stride Rite Corporation, and also means any successor to all or a major portion of its business which adopts this Plan pursuant to Section 11.05.

     2.10. “Compensation” for any Employee for any period means base salary, commissions, bonuses, unused accrued sick leave pay, vacation leave pay or payment for other leave, which a terminating employee would have been able to use if his or her employment had continued, short-term disability payments paid directly by the Company, overtime paid by the Company to the Employee during the period, and amounts which would have been paid to an Employee as Compensation but for an election by such Employee under Sections 125, 132(f)(4) or 401(k) of the Code; provided, however that “Compensation” shall not include moving allowances, expense reimbursement, payments under any sick leave or disability plan sponsored by the Company under which payments are not made directly by the Company, payments from or contributions to any other benefits program sponsored by the Company, extra compensation of any other nature, payments made by the Company to an Employee that do not constitute income from within the United States for purposes of the Code, or pay paid after an individual’s termination of employment unless the pay is paid within 2¹/2 months after termination of employment, subject to the following provisions of this Section. Notwithstanding the preceding sentence, to the extent that the following amounts are otherwise included in the definition of

5

Compensation and are paid no later than the later of the date which is 2¹/2 months after termination of employment or the end of the Plan Year that includes the date of termination of employment, such amounts paid after an Employee’s termination of employment shall be deemed Compensation: regular pay, including compensation for services during regular working hours, overtime, shift differential, commissions, bonuses or other similar payments, and payment for unused accrued sick, vacation or other leave, but only if the Employee would have been able to use the leave if employment had continued. The exclusions described in this Section 2.10 with respect to post-employment payments shall not apply to payments to an individual who does not currently perform services for the Company by reason of qualified military service under Code Section 414(u)(1), to the extent such payments do not exceed the compensation such individual would have received from the Company if he or she had continued to perform services for the Company.

     Compensation in excess of $245,000 shall be disregarded, although such amount shall be adjusted for cost-of-living increases in accordance with Code Section 401(a)(17)(B).

     2.11. “Eligible Employee” means any Employee other than an Employee covered by a collective bargaining agreement as to which retirement benefits have been a subject of good faith bargaining, unless the collective bargaining agreement specifically provides for participation in this Plan. An individual will not be an Eligible Employee with respect to service performed while he is classified on the Company’s records as being in a category of employment that disqualifies him or her from being an “Eligible Employee”, as described above in this Section 2.11, even if that classification is later retroactively changed.

     2.12. “Employee” means any person who is classified by the Company as being employed by the Company as a common law employee at the time such individual’s services are

6

rendered to the Company, has Federal income tax withheld by the Company and receives a Form W-2 from the Company.

     2.13. “Entry Date” means the first day of each calendar month.

     2.14. “Highly Compensated Employee” means (i) any Employee who was, at any time in the preceding year or the current year, a five percent (5%) owner, as defined in Code Section 416(i)(1), or (ii) any Employee who, in the preceding year received compensation (as defined in Section 6.05) from the Company in excess of $110,000 (as adjusted pursuant to Section 415(d) of the Code). The determination of who is a Highly Compensated Employee will be made in accordance with Code Section 414(q) and the regulations thereunder.

     2.15. “Hour of Service” means:

          (a) Each hour for which an Employee is directly or indirectly paid or entitled to payment by the Company or an Affiliated Company for the performance of duties. These hours shall be credited to the Employee for the Plan Year(s) in which the duties are performed; and

          (b) Each hour for which an Employee is directly or indirectly paid or entitled to payment by the Company or an Affiliated Company on account of a period of time during which no duties are performed (irrespective of whether the employment relationship has terminated) due to vacation, holiday, illness, incapacity (including disability), layoff, jury duty or other similar reason. These hours shall be calculated and credited pursuant to Section 2530.200b-2(b) and (c) of the Department of Labor Regulations which are incorporated herein by reference;

          (c) Each hour for which an Employee would have been credited with an Hour of Service but for a Maternity/Paternity Leave of Absence. No more than 501 Hours of Service

7

will be credited under this paragraph for any single continuous period. Such Hours shall be credited in the Plan Year during which such absence begins if such credit is necessary to avoid a One-Year Break in Service for such year; otherwise, such Hours shall be credited in the immediately following Plan Year;

          (d) Each hour for which back pay, irrespective of mitigation of damages, has been either awarded or agreed to by the Company or an Affiliated Company. The same hours shall not be credited under both paragraph (a) or paragraph (b), as the case may be, and under this paragraph (d). These hours shall be credited to the Employee for the Plan Year(s) to which the award or agreement pertains rather than the Plan Year in which the award, agreement, or payment is made; and

          (e) Each hour credited pursuant to Section 3.05.

     2.16. “Investment Fund” or “Investment Funds” means one or more of the funds established by the Committee for the investment of Plan assets, as more fully described in Section 5.08. Effective October 1, 2011, unless and until the Plan is amended accordingly, the Plan shall provide a Collective Brands Common Stock Fund as an investment option.

     2.17. “Matching Contributions” means the contributions made by the Company pursuant to Section 4.03.

     2.18. “Maternity/Paternity Leave of Absence” means a period of absence from the Company or an Affiliated Company that begins on or after January 1, 1985 for any of the following reasons:

          (a) the Employee’s pregnancy;

          (b) birth of the Employee’s child;

8

          (c) placement of a child with the Employee in connection with the adoption of such child by the Employee; or

          (d) the caring for such child for a period beginning immediately following such birth or placement;

provided, however, that in order for an Employee’s absence to qualify as a Maternity/Paternity Leave of Absence, the Committee may require the Employee to furnish such information (in such form and at such time as it may reasonably require) establishing that the absence from work is an absence described hereunder.

     2.19. “Normal Retirement Age” means age sixty-five.

     2.20. “One-Year Break in Service” means a Plan Year in which an Employee has not completed more than 500 Hours of Service.

     2.21. “Participant” means an Employee who participates in the Plan in accordance with Article III of the Plan.

     2.22. “Plan” means the “COLLECTIVE BRANDS PERFORMANCE + LIFESTYLE GROUP EMPLOYEE SAVINGS & INVESTMENT PLAN” as set forth herein, together with any and all amendments hereto.

     2.23. “Plan Sponsor” means The Stride Rite Corporation.

     2.24. “Plan Year” means the calendar year.

     2.25. “Salary Reduction/Deduction Agreement” means the agreement entered into between the Company and an Employee pursuant to the provisions of Section 3.04.

     2.26. “Tax Deferred Contributions” means the contributions made by the Company pursuant to Section 4.01 of the Plan in consideration of a Participant’s agreement to reduce his salary by a comparable amount pursuant to a Salary Reduction/Deduction Agreement.

9

     2.27. “Total Compensation” means, in the case of each Employee and for each Plan Year, all compensation received by the Employee from the Company during the Plan Year, including base pay, bonuses and overtime pay, plus any amounts that would have been received by the Employee as Total Compensation during the Plan Year but for an election under Sections 125, 132(f)(4) or 401(k) of the Code; provided, however, that “Total Compensation” does not include any contributions under this Plan or any other employee benefit plan, fund, program or arrangement, whether now or hereafter established, any moving or other expense reimbursements, imputed compensation, or property received by the Employee. In no event shall an Employee’s Total Compensation for any Plan Year beginning after December 31, 2010, exceed, for purposes of this Plan, $245,000 (subject to cost-of-living adjustments made by the Secretary of Treasury or his delegate under Section 401(a)(17)(B) of the Code).

     2.28. “Trust” means the sum of the assets held in the trusts established pursuant to the Plan plus all contributions made hereunder and held by the Trustee in a trust or trusts created pursuant hereto, increased by any gains, profits, or income thereon and decreased by any losses thereon, by any expenses properly incurred in the administration of the Plan and Trust, and by any payments made thereon under the Plan.

     2.29. “Trust Agreement” means each agreement entered into by the Company and one or more Trustees to govern the Trust, as the same may be amended from time to time.

     2.30. “Trustee” means one or more individuals or banks, trust companies or other financial institutions who are designated to hold and manage the Trust or any parties thereof.

     2.31. “Valuation Date” means each date that the New York Stock Exchange is open, or such other date or dates as the Committee may designate in its own discretion.

10

     2.32. “Year of Eligibility Service” means (i) the twelve-consecutive-month period beginning on the Employee’s employment commencement date but only if such Employee is credited with 1,000 or more Hours of Service during such period, or (ii) if the Employee is not credited with 1,000 or more Hours of Service in the period described in (i), each Plan Year commencing after his employment commencement date during which he has completed 1,000 or more Hours of Service.

     2.33. “Year of Vesting Service” for any Employee means each Plan Year during which the Employee has completed 1,000 or more Hours of Service.

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ARTICLE III — PARTICIPATION

     3.01. Eligibility for Participation. Each Eligible Employee who was a Participant on September 30, 2011 shall continue to be a Participant on October 1, 2011. Each other Employee, including each future Employee, shall be eligible to become a Participant on the Entry Date coincident with or next following the latest of (i) his attainment of age 21 and his completion of six consecutive months of employment with the Company and (ii) the date he becomes an Eligible Employee. Notwithstanding the preceding, effective January 1, 2011, an individual who has completed 1,000 or more Hours of Service as of the end of a twelve-consecutive-month period that begins on his or her employment commencement date or reemployment commencement date, if applicable (or any annual anniversary thereof) shall be deemed to have satisfied as of the end of such period the service required under this Section for eligibility to become a Participant.

     Notwithstanding any other provisions of the Plan, any individual who is providing services to the Company in the capacity of, or who is designated by the Company as an independent contractor, and who is subsequently reclassified as an Employee by court or similar action (whether retroactively or prospectively), shall not be eligible to participate in the Plan, and shall be treated as a member of an excluded class. No such excluded individual shall have any claim for benefits under the Plan for any period during which he or she is excluded from participation.

     3.02. Determination of Eligibility by Committee. The determination of an Employee’s eligibility for participation under the Plan shall be made by the Committee from the Company’s records, and the Committee’s decisions on these matters shall be conclusive and binding upon all persons.

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     3.03. Duration of Eligibility. A Participant shall continue as an active Participant until the earlier of (i) his termination of employment with the Company and (ii) the date he ceases to be an Eligible Employee, and shall cease to be an active Participant entitled to share in contributions hereunder upon such date. To the extent a former Participant’s Accounts have not been fully distributed, such former Participant shall be treated as a Participant for purposes of applying the provisions of the Plan to such Accounts. A former Participant shall be eligible to become an active Participant under the Plan on the Entry Date coincident with or next following the date he again becomes an Eligible Employee.

     3.04. Salary Reduction/Deduction Agreement. Each Eligible Employee who has satisfied the eligibility requirements of Section 3.01 and who is not an active Participant may elect to become a Participant by entering into a Salary Reduction/Deduction Agreement with the Company. In accordance with procedures established by the Committee, a Salary Reduction/Deduction Agreement may be entered into, suspended, changed or resumed in writing, through a voice response system, by electronic means, or through any other procedures prescribed by the Committee. The terms of any such Salary Reduction/Deduction Agreement shall:

          (a) provide that such Participant agrees either (i) to accept a pre-tax reduction in cash Compensation from the Company, in an amount equal to any whole number percentage of his Compensation from one percent (1%) to eighteen percent (18%) of his Compensation, in consideration of the Company’s agreement to contribute such amount into the Trust on his behalf and/or (ii) to have a portion of his cash Compensation deducted by the Company on an after-tax basis in an amount equal to any whole number percentage of his Compensation from two percent (2%) to six percent (6%) of his Compensation; provided, the sum of the salary reduction and

13

deduction percentages shall not exceed twenty percent (20%); and provided further, that the amount of pre-tax reduction under this Plan and all other plans maintained by the Company shall not exceed $16,500 (as adjusted under Section 402(g) of the Code or such greater dollar amount as may be established by the Secretary of the Treasury under Section 402(g) of the Code) in any calendar year;

          (b) specify the percentage of such Participant’s Compensation reduced and to be paid by the Company on a pre-tax basis and/or to be deducted and to be paid by the Company on an after-tax basis on such Participant’s behalf into the Trust;

          (c) specify the portion of such Participant’s salary reduction and/or deduction to be allocated among the Investment Funds in accordance with Section 5.08;

          (d) designate a Beneficiary or Beneficiaries to receive any payment or distribution which may be due upon such Participant’s death in accordance with Section 7.04; and

          (e) set forth such other or additional information as, in the opinion of the Committee, is desirable or necessary in the operation of the Plan.

     Each Participant who enters into a Salary Reduction/Deduction Agreement may elect to change the percentage rate of his salary reduction or deduction effective only as of any Entry Date, and each Participant may elect to completely suspend his salary reduction or deduction only as of the first day of any regular pay period. Each such change or suspension shall be filed with the Committee, in writing, through a voice response system, by electronic means or through any other procedure prescribed by the Committee, at least fifteen (15) days (or such shorter period as the Committee allows) prior thereto. No change in the percentage of a Participant’s salary reduction or deduction shall be made at any other time by the Participant and the salary

14

reduction or deduction percentage in force at any time shall continue in force unless and until changed in accordance with the provisions of the preceding sentences.

     The participation of a former active Participant or an Eligible Employee who has satisfied the eligibility requirements of Section 3.01 shall commence on the first Entry Date which is not less than thirty (30) days (or such shorter period as the Committee allows) after the completion of such Salary Reduction/Deduction Agreement. In the case of an Eligible Employee becoming eligible for participation for the first time or upon reemployment by the Company, (i) the Committee shall notify such Eligible Employee of his eligibility in advance of the Entry Date on which such Eligible Employee is first eligible and forward to such Employee a Salary Reduction/Deduction Agreement, and (ii) such Eligible Employee shall become a Participant on such Entry Date if such Eligible Employee enters into said agreement with the Company at least thirty (30) days (or such shorter period as the Committee allows) prior to such Entry Date. In all cases, the initiative for applying for participation rests with the individual Eligible Employee.

     3.05. Military and Unpaid Leaves of Absence. Except as otherwise specifically provided, an Employee who leaves the Company to enter the armed services of the United States of America and who returns to its employ under conditions which entitle such Employee to reemployment under applicable Federal laws, or an Employee who, with the approval of the Company and without pay, is absent from work on account of sickness, temporary disability, temporary layoff, jury duty, vacation, or for any other similar reason shall be credited by the Committee with the number of Hours of Service obtained by multiplying the number of hours in such Employee’s regular work week immediately prior to the date such absence began by the duration (in weeks) of the absence (or on such basis as is required by Federal law in connection with service in the armed forces). For purposes of granting leaves of absence and determining

15

the number of credited hours, Employees in similar circumstances shall be treated alike in accordance with the standards set forth by the Company and in this Plan. Nothing herein contained shall restrain the Company’s right to terminate the employment of any Employee, whether or not during a leave of absence. If any Employee shall fail to return from any such absence as required by the Company in accordance with the Plan and applicable Federal law regarding service in the armed forces, such Employee shall retroactively lose all credit for those Hours of Service previously credited to such Employee under this Section 3.05, and his employment shall be deemed terminated as of the commencement of his absence unless the Company shall determine that his employment is terminated as of a later date, except to the extent prohibited under Federal law.

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ARTICLE IV — CONTRIBUTIONS UNDER THE PLAN

     4.01. Tax Deferred Contributions. For each pay period, the Company shall contribute to the Trust on behalf of each Participant who has entered into a Salary Reduction/Deduction Agreement the amount, if any, which has been specified as a pre-tax contribution in said Salary Reduction/Deduction Agreement. Notwithstanding anything elsewhere herein to the contrary, Tax Deferred Contributions shall be subject to the limitations described in Article VI of the Plan.

     4.02. After-Tax Contributions. Except as otherwise provided herein, each Participant may, but shall not be required to, contribute to the Trust such amount or amounts in cash as he may choose, subject to the limitations in Sections 3.04 and 6.04. The Participant’s After-Tax Contributions, if any, under this Section 4.02 shall be payable in cash to the Company at such time or times and in such manner as the Company shall determine. Contributions to the Plan pursuant to this Section 4.02 are not intended to be deductible for Federal income tax purposes.

     4.03. Matching Contributions. Effective April 1, 2009, or as soon thereafter as administratively feasible, the Company shall contribute to the Trust under the Plan for each Participant who makes Tax Deferred Contributions an amount equal to one hundred percent (100%) of the amount of the first 3% of a Participant’s Tax Deferred Contributions and fifty percent (50%) of the next 3% of a Participant’s Tax Deferred Contributions. Matching Contributions shall be made on a regular basis during the Plan Year.

     4.04. Payment of Contributions.

          (a) The Tax Deferred Contributions made by the Company on behalf of each Participant, and the After-Tax Contributions made by each Participant, with respect to each month shall be paid into the Trust by the Company as soon as possible, but in no event later than the fifteenth (15th) business day of the month following such month or such later date permitted

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by law and deposited in the Investment Funds in the proportions designated by the election of such Participant under Section 5.08 of the Plan.

          (b) The Matching Contributions made by the Company on behalf of each Participant with respect to each calendar month shall be made within the time required by law in order for the Company to obtain a deduction of the amount of such payment for Federal income tax purposes for such Plan Year (including extensions thereof), as determined under the applicable provisions of the Code and deposited in the Investment Funds in the proportions designated by the election of such Participant under Section 5.08 of the Plan.

     4.05. Reversion of Certain Contributions Made by the Company. All Tax Deferred and Matching Contributions made pursuant to Sections 4.01 and 4.03 shall be made upon the condition that such contributions are fully deductible for Federal income tax purposes. In the event that any such deduction is disallowed in whole or in part, then the Company may direct the Trustee to return the full amount attributable to such contributions (to the extent disallowed) to the Company at any time within the twelve-month period commencing on the date of disallowance. In the event that the Company shall make Tax Deferred and Matching Contributions pursuant to Sections 4.01 or 4.03 on the basis of a mistake of fact, the Company may direct the Trustee to return the full amount attributable to such contributions to the Company at any time within the twelve-month period commencing on the date of contribution.

     4.06. Rollover Contributions.

          (a) Any Eligible Employee may make a Rollover Contribution of all or any part of a distribution (including spousal death benefits) from (i) a qualified plan described in Section 401(a) or 403(a) of the Code, including after-tax employee contributions, (ii) an annuity contract described in Section 403(b) of the Code, including after-tax employee contributions, (iii)

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an eligible plan under Section 457(b) of the Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state, including any after-tax contributions, or (iv) an individual retirement account or annuity described in Section 408(a) or 408(b) of the Code that is eligible to be rolled-over and would otherwise be includible in gross income.

          (b) Contributions and transfers under this Section 4.06 shall be paid to the Trustee in cash and shall be credited to a separate book account maintained for such individual under the Plan, which account shall be known as his “Rollover Account.” An Eligible Employee’s Rollover Account shall be nonforfeitable at all times.

          (c) Contributions made by an Eligible Employee pursuant to this Section 4.06 shall be disregarded in applying the limitations set forth in Article VI.

          (d) After the receipt of any Rollover Contribution made by an Eligible Employee and after the Account balances of the Participants have been adjusted as provided in Section 5.06, the Committee shall credit such Rollover Contribution to such Eligible Employee’s Rollover Account as of the Valuation Date coincident with or next following the receipt of such Rollover Contribution.

          (e) Any Eligible Employee for whom a Rollover Account is established under the Plan will be deemed to be a Participant for purposes of applying the Plan to such Rollover Account, and shall not otherwise be eligible to become a Participant unless and until he has satisfied the requirements of Article III.

     4.07. Catch-Up Contributions. All Participants who have attained age 50 before the close of the Plan Year shall be eligible to make catch-up contributions in accordance with, and subject to the limitations of, Section 414(v) of the Code. Such catch-up contributions shall not

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be taken into account for purposes of the provisions of the Plan implementing the required limitations of Sections 402(g) and 415 of the Code. The Plan shall not be treated as failing to satisfy the provisions of the Plan implementing the requirements of Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b) or 416 of the Code, as applicable, by reason of the making of such catch-up contributions.

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ARTICLE V — PARTICIPANT’S ACCOUNTS; ALLOCATION OF ASSETS AND
CONTRIBUTIONS; PARTICIPANTS’ INVESTMENT ELECTIONS

     5.01. Participants’ Accounts. The Committee shall maintain the following Accounts for each Participant under the Plan: (a) a Tax Deferred Account to which Tax Deferred Contributions made by the Company for the benefit of such Participant shall be credited; (b) a Company Account to which Matching Contributions contributed with respect to Plan Years beginning before January 1, 2007 for the benefit of such Participant shall be credited; (c) a Company Account II to which Matching Contributions contributed with respect to Plan Years beginning on or after January 1, 2007 shall be credited; (d) a Voluntary Account to which After-Tax Contributions made by such Participant shall be credited; and (e) a Rollover Account to which Rollover Contributions made by an Eligible Employee pursuant to Section 4.06 shall be credited. The rights of each Participant to the amounts allocated to his Tax Deferred, Company Account II, Voluntary and Rollover Accounts shall be fully vested and nonforfeitable at all times.

     5.02. Allocation of Tax Deferred Contributions. At the time of payment of any Tax Deferred Contributions to the Trust, the Company shall deliver to the Committee a schedule showing the name of each Participant and the amount of Tax Deferred Contributions made on his behalf. The schedule shall also contain such other information as the Committee may reasonably require for the proper administration of the Plan. Upon receiving all such schedules with respect to a calendar month or other period ending on a Valuation Date and after the Account balances of the Participants have been adjusted as provided in Section 5.06, the Committee shall credit to the Tax Deferred Account of each Participant listed on such schedules the amount of Tax Deferred Contributions made to the Trust on his behalf as shown therein.

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     5.03. Allocation of After-Tax Contributions. At the time of payment of any After-Tax Contributions made to the Trust, the Company shall deliver to the Committee a schedule showing the name of each Participant and the amount of such After-Tax Contributions made by such Participant. The schedule shall also contain such other information as the Committee may reasonably require for the proper administration of the Plan. Upon receiving such schedule with respect to a calendar month or other period ending on a Valuation Date and after the Account balances of the Participants have been adjusted as provided in Section 5.06, the Committee shall credit to the Voluntary Account of each Participant listed on such schedule the amount of such After-Tax Contribution made to the Trust by such Participant as shown therein.

     5.04. Allocation of Matching Contributions. At the time of payment of any Matching Contributions made to the Trust, the Company shall deliver to the Committee a schedule showing the name of each Participant and the amount of such Matching Contributions made on his behalf. The schedule shall also contain such other information as the Committee may reasonably require for the proper administration of the Plan. Upon receiving such schedule with respect to a calendar month or other period ending on a Valuation Date and after the Account balances of the Participants have been adjusted as provided in Section 5.06, the Committee shall credit to the Company Account II of each Participant listed on such schedule the amount of such Matching Contribution made to the Trust on his behalf as shown therein.

     5.05. Allocation of Rollover Contributions. After the receipt of any Rollover Contribution made by an Eligible Employee and after the Account balances of the Participants have been adjusted as provided in Section 5.06, the Committee shall credit such Rollover Contribution to such Participant’s Rollover Account as of the investment date of such Rollover Contribution.

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     5.06. Valuation of Assets. The Investment Funds shall be valued by the Trustee, no less frequently than as of each Valuation Date, according to such methods as the Trustee may reasonably select in order to determine the fair market value of the assets of each such Investment Fund. Each Account maintained under the direction of the Committee shall be adjusted, no less frequently than as of each Valuation Date, to reflect the effect of income collected and accrued, realized and unrealized profit and losses, expenses, distributions and all other transactions during the applicable period. All expenses of the Trust which are allocable to a Participant Account or Investment Fund shall be charged to such Account or Investment Fund. All such expenses allocable to an Investment Fund shall be charged against all Participant Accounts in the same proportion as the amount credited to such Participant Account and invested in such Investment Fund bears to the total amount invested in such Investment Fund. All such expenses allocable to a Participant Account will be charged against the interest of such Account invested in each Investment Fund in the same proportion as each such interest bears to the total value of the Account. Such valuations and adjustments of the Participants’ Accounts shall be made so as to preserve for each Account of each Participant its beneficial interest in each of the Investment Funds. The value of a Participant Account as of any Valuation Date shall be the sum of the interests of the Participant Account invested in each Investment Fund as of the Valuation Date for each such Investment Fund which is coincident with or immediately preceding the Valuation Date as of which the Participant Account is being valued.

     5.07. Distributions and Forfeitures. Whenever the Trustee shall make any distribution to or in behalf of a Participant in accordance with the provisions of Article VI, Article VII or Article VIII, and whenever a Participant shall forfeit all or any portion of the amount standing to the credit of his Account in accordance with the provisions of Section 6.04 or 7.05, such

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Participant’s Accounts shall be charged with the amount of such distribution or forfeiture. For this purpose, distributions shall also include in-service withdrawals or loans. The Accounts of any Participant shall continue to be maintained under the Plan and shall continue to share in the allocation of income, gain, losses, appreciation, and depreciation of assets pursuant to Section 5.06 until such Accounts have been fully distributed.

     5.08. Election of Investments. Each Participant shall, as of the date on which such Participant first becomes a Participant pursuant to Article III, designate in accordance with the procedures established by the Committee the portion of each of such Participant’s Tax Deferred Account, Voluntary Account, Company Account, Company Account II and Rollover Account to be invested in the Investment Funds available under the Trust. Each Participant may, as of any Entry Date, by use of the investment direction system maintained for such purposes by the Committee or its agent, elect to change such Participant’s investment election with respect to future contributions credited to any of such Participant’s aforementioned Accounts as well as amounts already credited to such Accounts to any other investment allocation permitted by the preceding sentence. Notwithstanding the preceding, effective October 1, 2011, the amount of future contributions that a Participant may elect to be invested in the Collective Brands Common Stock Fund shall be limited to 20% of such contributions. Any investment election made hereunder shall continue to be effective until properly revoked by the Participant. Any redemption fees or other terms of restriction imposed from time to time by any Investment Fund shall apply to or limit a Participant’s request to transfer amounts from one fund to one or more other funds. To the extent there is no investment election in effect with respect to a Participant, the Trustee shall invest amounts contributed to such aforementioned Accounts in respect of such Participant in such Investment Fund as the Committee shall determine on a uniform and

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consistent basis. Neither the Company nor the Committee shall have any liability for any losses that are the direct and necessary result of investment instructions given by a Participant, his Beneficiary, or an alternate payee under a qualified domestic relations order. The Plan is intended to constitute a plan described in Section 404(c) of ERISA and the regulations issued thereunder. For purposes of this Section 5.08, (a) a terminated Participant shall be considered to be a Participant of the Plan to the extent his Account balances under the Plan have not been distributed, (b) an Employee who has not yet satisfied the eligibility requirements of Article III shall be considered to be a Participant of the Plan to the extent he has elected to make a Rollover Contribution pursuant to Section 4.06, (c) while any balance remains in the Account of a Participant after his death, the Beneficiary of such Participant shall direct the investment of the Accounts to the same extent as if the Beneficiary were the Participant, and (d) to the extent required by a qualified domestic relations order, an alternate payee shall direct the investment of that portion of the Participant’s Accounts subject to the order to the same extent as if such alternate payee were the Participant.

     5.09. Shares of Collective Brands, Inc. (“Collective Brands Stock”) in the Collective Brands Common Stock Fund. This Section 5.09 is effective October 1, 2011.

          (a) Each Participant (or beneficiary of a deceased Participant) who has Accounts invested in the Collective Brands Common Stock Fund shall, as a named fiduciary within the meaning of Section 403(a)(1) of ERISA, have the right to direct the Trustee with respect to the vote of the number of shares of Collective Brands Stock attributable to units credited to him in the Collective Brands Common Stock Fund as of the latest practicable Valuation Date prior to or contemporaneous with the record date set by Collective Brands, Inc. for each meeting of shareowners of Collective Brands, Inc. For such purpose the Trustee shall

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furnish to each such Participant prior to each such meeting the proxy statement for such meeting, together with a form to be returned to the Trustee on which may be set forth the Participant’s instructions as to the manner of voting such shares of stock. Upon receipt of such instructions, the Trustee shall vote such shares in accordance therewith. If a Participant’s instructions are not received by the Trustee in a timely manner, the Trustee shall vote such Participant’s shares in the same proportion as the shares of Common Stock for which instructions were actually timely received from Participants. The Trustee shall not divulge the instructions of any Participant.

          (b) Each Participant (or beneficiary of a deceased Participant) who has Accounts invested in the Collective Brands Common Stock Fund shall, as a named fiduciary within the meaning of Section 403(a)(1) of ERISA, have the right with respect to the number of shares of Collective Brands Stock attributable to units credited to him in the Collective Brands Common Stock Fund as of the latest practicable Valuation Date, to direct the Trustee in writing as to the manner in which to respond to a tender or exchange offer with respect to Collective Brands Stock, and the Trustee shall respond in accordance with the instructions so received. The Trustee shall utilize its best efforts to timely distribute or cause to be distributed to each Participant such information as will be distributed to shareowners of Collective Brands, Inc. in connection with any such tender or exchange offer, together with a form requesting instructions on whether or not such shares will be tendered or exchanged. If the Trustee shall not receive timely direction from a Participant as to the manner in which to respond to such a tender or exchange offer, the Trustee shall not tender or exchange any shares of Collective Brands Stock with respect to which such Participant has the right of direction. Tenders as a result of a self-tender offer by Collective Brands, Inc. shall continue notwithstanding any investment change blackout. The Trustee shall not divulge the instructions of any Participant. The proceeds from

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the tender or exchange of shares attributable to units in Common Stock Investment Fund accounts of Participants shall be transferred to one of the Investment Funds pursuant to a procedure established by the Committee.

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ARTICLE VI — LIMITATIONS ON CONTRIBUTIONS AND ALLOCATIONS

     6.01. Contributions to be Deductible. Tax Deferred Contributions (exclusive of catch-up contributions made pursuant to Section 4.07) and Matching Contributions under the Plan with respect to a Plan Year shall not exceed that amount which, when added to the contributions made by the Company for that Plan Year to all other qualified pension or profit sharing plans maintained by the Company, equals the maximum amount allowable as a deduction by the Company pursuant to Section 404 of the Code with respect to such Plan Year.

     6.02. Limitation on Tax Deferred Contributions. This Section 6.02 is applicable with respect to the Plan Year beginning on January 1, 2009. Except for the Plan Year beginning on January 1, 2009, for Plan Years beginning on or after January 1, 2007, the Plan shall meet the provisions of a safe harbor 401(k) plan as provided in Section 401(k)(12) of the Code.

          (a) At any time during the Plan Year, the Company may suspend or reduce the amount of Tax Deferred Contributions (exclusive of catch-up contributions made pursuant to Section 4.07), including without limitation, setting a dollar limit as set forth on Appendix A of the Plan, which shall be a part of the Plan, with respect to any Participant or group of Participants if the Committee determines that such action is necessary to cause the test in either (i) or (ii) below to be met with respect to Tax Deferred Contributions for such Plan Year. Such adjustments shall be made in accordance with rules prescribed by the Committee.

          (i) The Actual Deferral Percentage for the Eligible Employees who are considered Highly Compensated Employees is not more than the Actual Deferral Percentage for all other Eligible Employees multiplied by 1.25; or

          (ii) The excess of the Actual Deferral Percentage for the Eligible Employees who are considered Highly Compensated Employees over the Actual Deferral Percentage for all other Eligible Employees is not more than two (2) percentage points,

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and the Actual Deferral Percentage for the Eligible Employees who are considered Highly Compensated Employees is not more than the Actual Deferral Percentage for all other Eligible Employees multiplied by two (2).

     For the purposes of this subsection (a), “Actual Deferral Percentage” for a specified group of Eligible Employees for a Plan Year shall be the average of the ratios (calculated separately for each Eligible Employee in such group) of (A) the amount of the Tax Deferred Contributions (exclusive of catch-up contributions made pursuant to Section 4.07) credited on behalf of the Eligible Employee for such Plan Year plus any qualified nonelective contributions and qualified matching contributions which the Company elects to treat as elective deferrals in accordance with Section 6.02(d) to (B) the Eligible Employee’s compensation, as defined in Code Section 414(s), for the portion of such Plan Year while the individual is an Eligible Employee.

          (b) The Company may implement rules limiting contributions under Section 4.01 which may be made on behalf of some or all Highly Compensated Employees so that the limits of Section 401(k)(3) or 401(m)(2) of the Code are satisfied. If for any Plan Year the Plan satisfies neither of the tests set forth in Code Section 401(k)(3), the Trustee shall be directed by the Committee to return to each Highly Compensated Employee his or her portion of the excess contributions (plus the income or less the loss allocable to such excess contributions, as determined in accordance with Code Section 401(k) and applicable Treasury Regulations) for such Plan Year within 12 months after the last day of such Plan Year. A Highly Compensated Employee shall forfeit any Matching Contributions which were contributed on account of any portion of the excess contributions even if such Matching Contributions are vested and such forfeited amounts shall be applied in accordance with Section 7.05. Each Highly Compensated

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Employee’s portion of the excess contributions for a Plan Year shall be determined under a two-step process. First, the aggregate amount of excess contributions shall be calculated. This shall be done by reducing the actual deferral percentages of those Highly Compensated Employees with the highest actual deferral percentages to the extent necessary but not below the next highest level of actual deferral percentages. This process shall be repeated, to the extent necessary, until the actual deferral percentage for the group of Highly Compensated Employees satisfies one of the tests set forth in Code Section 401(k)(3). The aggregate amount of excess contributions shall be equal to the sum of all such reductions. Second, the aggregate amount of excess contributions to be returned shall be allocated by reducing the pre-tax contributions of those Highly Compensated Employees with the highest amount of pre-tax contributions to the extent necessary but not below the next highest amount of pre-tax contributions. This process shall be repeated, to the extent necessary, until all excess contributions to be returned shall be allocated among the Highly Compensated Employees. The income or loss allocable to a Highly Compensated Employee’s portion of the excess contribution will be determined under such reasonable method as the Committee shall establish, provided the method does not discriminate in favor of Highly Compensated Employees, is used consistently for all Participants and for all corrective distributions under the Plan for the Plan Year, and is used by the Plan for allocating income to Participants’ Accounts.

          (c) Coordination With Distributions Of Elective Deferrals. If the Plan is required to distribute both elective deferrals and excess contributions for a Plan Year, the Plan shall:

          (i) calculate and distribute the elective deferrals before determining the excess contributions to be distributed to Highly Compensated Employees;

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          (ii) calculate the actual deferral percentage including the amount of excess elective deferrals distributed pursuant to (i) above; and

          (iii) distribute excess contributions to Participants by reducing the excess contributions distributed to a Participant by the amount of excess elective deferrals distributed to such Participant.

          (d) Election To Make Additional Company Contributions. Notwithstanding the above, in accordance with Treasury Regulation Section 1.401(k)-2(a)(6), the Company may elect, in lieu of all or a portion of the corrective distribution described in this Section 6.02 above, to make additional qualified nonelective contributions or qualified matching contributions which are treated as elective deferrals under the Plan and that, in combination with the elective deferrals, satisfy the actual deferral percentage test. Any such additional qualified nonelective contributions will be credited to a Participant’s Tax Deferred Account and shall be allocated to each Participant who is not a Highly Compensated Employee in an amount as determined by the Company and will be contributed as a percentage of such Participant’s Compensation for the Plan Year. Any such additional qualified matching contributions will be credited to the Participant’s Tax Deferred Account and shall be allocated to each Participant who is not a Highly Compensated Employee and will be contributed as a percentage of the amount contributed by such Participant under Section 4.01.

          (e) Testing Year. The actual deferral percentage of Employees who are not Highly Compensated Employees shall be determined as of the Plan Year for which the Plan must satisfy one of the tests in Code Section 401(k)(3).

          (f) Definitions. All terms used in this Section 6.02 shall have the meanings given such terms in Code Sections 401(k) and 401(m) and the regulations thereunder.

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          (g) The Committee shall determine each Plan Year whether the limitation set forth in subsection (a) above is met and its determination shall be final and binding on all persons.

     6.03. Return of Excess Deferrals. If, during any calendar year, more than the maximum permissible dollar amount under Section 3.04(a) of the Plan is allocated pursuant to one or more cash or deferred arrangements to a Participant’s Accounts under this Plan and any other plan described in Sections 401(k), 408(k), or 403(b) of the Code, the following provisions shall apply:

          (a) no later than March 1 of the next succeeding calendar year, the Participant may, but is not required to, allocate all or part of such contributions in excess of the maximum permissible dollar amount (“excess deferrals”) to this Plan. To be effective, such allocation must be in writing, state that excess deferrals have been made on behalf of such Participant for the preceding calendar year, and be submitted to the Committee; and

          (b) to the extent a Participant allocates excess deferrals in a timely manner to this Plan pursuant to (a) above, the Committee shall direct the Trustee to return such excess deferrals, as adjusted for income or losses in accordance with Code Section 402(g) and the applicable Treasury Regulations thereunder, to the Company for distribution to the Participant no later than the April 15 following such allocation. No Participant shall be permitted to have elective deferrals made under this Plan, or any other qualified plan maintained by the Company during any taxable year, in excess of the dollar limitation contained in Section 402(g) of the Code in effect for such taxable year, except to the extent permitted under Section 4.07 of this Plan and Section 414(v) of the Code, if applicable.

     6.04. Limitation on Matching and After-Tax Contributions. Effective January 1, 2010 the Plan satisfies Code Section 401(m)(2) with respect to Matching Contributions by complying

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with the provisions of Code Section 401(m)(11) and the rules of the Internal Revenue Service promulgated thereunder. The limitations set forth in this Section 6.04 shall continue to apply, however, to After-Tax Contributions effective January 1, 2010.

          (a) The tests set forth in Code Section 401(m)(2) and the provisions in this Section 6.04 for purposes of the Plan satisfying such tests shall be applied under this Section with respect to “401(m) Contributions” as defined herein. At any time during the Plan Year, the Company may suspend or reduce the amount of 401(m) Contributions with respect to any Participant or group of Participants if the Committee determines that such action is necessary to cause the test in either (i) or (ii) below to be met with respect to 401(m) Contributions for such Plan Year. Such adjustments shall be made in accordance with rules prescribed by the Committee. The term “401(m) Contributions” shall mean After-tax Contributions and, with respect to the Plan Year beginning on January 1, 2009 only, shall also include Matching Contributions.

          (i) The Actual Contribution Percentage for the Eligible Employees who are considered Highly Compensated Employees is not more than the Actual Contribution Percentage for all other Eligible Employees for the prior Plan Year multiplied by 1.25; or

          (ii) The excess of the Actual Contribution Percentage for the Eligible Employees who are considered Highly Compensated Employees over the Actual Contribution Percentage for all other Eligible Employees for the prior Plan Year is not more than two (2) percentage points, and the Actual Contribution Percentage for the Eligible Employees who are considered Highly Compensated Employees is not more

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than the Actual Contribution Percentage for all other Eligible Employees for the prior Plan Year multiplied by two (2).

     For the purposes of this subsection (a), “Actual Contribution Percentage” for a specified group of Eligible Employees for a Plan Year shall be the average of the ratios (calculated separately for each Eligible Employee in such group) of (A) the amount of 401(m) Contributions credited to the Eligible Employee’s applicable account on behalf of the Eligible Employee for such Plan Year plus any qualified nonelective contributions and elective deferrals which the Company elects to treat as matching contributions in accordance with Section 6.04(c) to (B) the Eligible Employee’s compensation, as defined in Code Section 414(s), for the portion of such Plan Year while the individual is an Eligible Employee.

          (b) Notwithstanding anything herein to the contrary, the tests in Code Section 401(m)(2) shall be treated as satisfied with respect to such 401(m) Contributions to the Plan, or a portion of the Plan, if the Plan or such portion is a collectively bargained plan that automatically satisfies Code Section 410(b), in accordance with Treasury Regulation Sections 1.401(m)-1(b)(2) and 1.410(b)-2(b)(7). If for any Plan Year the Plan fails to satisfy either of the tests set forth in Code Section 401(m)(2), the Trustee shall be directed by the Committee to distribute to each Highly Compensated Employee his or her vested portion (and forfeit the nonvested portion) of the excess aggregate contributions (plus the income or less the losses allocable to such excess aggregate contributions, as determined in accordance with Code Section 401(m) and applicable Treasury Regulations) for such Plan Year within 12 months after the last day of such Plan Year. Each Highly Compensated Employee’s portion of the excess aggregate contributions for a Plan Year shall be determined under a two-step process. First, the aggregate amount of excess aggregate contributions shall be calculated. This shall be done by reducing the actual

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contribution percentages of those Highly Compensated Employees with the highest actual contribution percentages to the extent necessary but not below the next highest level of actual contribution percentages. This process shall be repeated, to the extent necessary, until the actual contribution percentage for the group of Highly Compensated Employees satisfies one of the tests set forth in Code Section 401(m)(2). The aggregate amount of excess aggregate contributions shall be equal to the sum of all such reductions. Second, the aggregate amount of excess aggregate contributions to be distributed or forfeited shall be allocated by first reducing any After-Tax Contributions, and then with respect to any Matching Contributions included as 401(m) Contributions, made by or on behalf of Highly Compensated Employees with the highest total amount of 401(m) Contributions to the extent necessary but not below the next highest total amount of 401(m) Contributions. This process shall be repeated, to the extent necessary, until all excess aggregate contributions to be distributed or forfeited shall be allocated among the Highly Compensated Employees. The income or loss allocable to a Highly Compensated Employee’s portion of the excess aggregate contributions will be determined under such reasonable method as the Committee shall establish, provided the method does not discriminate in favor of Highly Compensated Employees, is used consistently for all Participants and for all corrective distributions under the Plan for the Plan Year, and is used by the Plan for allocating income to Participants’ Accounts.

          (c) Election To Make Additional Company Contributions. Notwithstanding the above, in accordance with Treasury Regulation Section 1.401(m)-2(a)(6), the Company may elect, in lieu of all or a portion of the distribution described above, to either (i) make an additional qualified nonelective contribution that, in combination with 401(m) Contributions for the Plan Year, satisfies the actual contribution percentage test or (ii) recharacterize elective

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contributions as matching contributions. Any such additional qualified nonelective contributions will be credited to a Participant’s Tax Deferred Account and shall be allocated to each Participant who is not a Highly Compensated Employee in an amount as determined by the Company and will be contributed as a percentage of such Participant’s Compensation for the Plan Year.

          (d) Testing Year. The actual contribution percentage of Employees who are not Highly Compensated Employees shall be determined as of the Plan Year preceding the Plan Year for which the Plan must satisfy one of the tests in Code Section 401(m)(2). Notwithstanding the preceding, with respect to the Plan Year beginning on January 1, 2009 only, the actual contribution percentage of Employees who are not Highly Compensated Employees shall be determined as of the Plan Year for which the Plan must satisfy one of the tests in Code Section 401(m)(2).

          (e) Definitions. All terms used in this Section 6.04 shall have the meanings given such terms in Code Sections 401(k) and 401(m) and the regulations thereunder.

          (i) Special Rule For Early Participation. If the Company applies Code Section 410(b)(4)(B) in determining whether the Plan satisfies Code Section 410(b) by excluding from consideration Eligible Employees who have not met minimum age and service requirements, the Company may exclude from consideration all Employees who are not Highly Compensated Employees and who have not met the minimum age and service requirements of Code Section 410(a)(1)(A) for purposes of satisfying the tests in Code Sections 401(k)(3) and 401(m)(2), as applicable.

          (ii) Highly Compensated Employee In Two Or More Qualified Plans. To the extent required by the Code and applicable regulations, the actual contribution

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percentage and the actual deferral percentage of a Highly Compensated Employee who is eligible to participate in two or more qualified plans which have

          (A) cash or deferred arrangements or

          (B) matching contributions or after-tax contributions features maintained by the Company or an Affiliated Company, shall be calculated by treating

          (C) all such cash or deferred arrangements in which the Highly Compensated Employee is eligible to participate as one cash or deferred arrangement for purposes of calculating the actual deferral percentage, as applicable, for such Highly Compensated Employee and

          (D) all such features in which the Highly Compensated Employee is eligible to participate as one feature for purposes of calculating the actual contribution percentage for such Highly Compensated Employee.

          (iii) Plan Restructuring. The Plan may be aggregated with another plan or other plans or disaggregated under Section 1.401(k)-1(b)(4) and Section 1.401(m)-1(b)(4) of the Treasury Regulations for any Plan Year in order to pass the actual contribution percentage and actual deferral percentage tests, as applicable, set forth in Sections 6.02 and 6.04.

     6.05. Limitations on Allocations. Notwithstanding anything hereinabove to the contrary, the “annual additions” credited to the Accounts of any Participant for any Plan Year pursuant to Section 5.02 (dealing with Tax Deferred Contributions), Section 5.03 (dealing with After-Tax Contributions), Section 5.04 (dealing with Matching Contributions, including forfeitures), and this Section 6.05, except to the extent permitted under Section 414(v) of the Code, shall be reduced to the extent that such amounts would cause the sum of all such

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contributions credited to the Accounts of such Participant under the Plan for such Limitation Year to exceed the lesser of (i) $49,000 (as adjusted pursuant to Section 415(d) of the Code), or (ii) one hundred percent (100%) of such Participant’s compensation within the meaning of Code Section 415(c)(3). Compensation within the meaning of Code Section 415(c)(3) shall mean the amount as defined in Treasury Regulation Section 1.415(c)-2(d)(4) (e.g., amounts reported in Box 1 of Form W-2, plus amounts that would have been received and includible in gross income but for an election under Code Section 125(a), 132(f)(4), 402(e)(3), 402(h)(1)(B), 402(k) or 457(b)), but not in excess of $245,000 (as adjusted in accordance with Section 401(a)(17)(B) of the Code) for any Limitation Year. Such amount shall not include any severance pay, whether paid before or after an Eligible Employee’s termination of employment. In addition, such amount shall not include other compensation paid after an individual’s termination of employment. Notwithstanding the preceding sentence, to the extent that the following amounts are otherwise included in the definition of compensation and are paid no later than the later of the date which is 2¹/2 months after termination of employment or the end of the Limitation Year that includes the date of termination of employment, such amounts paid after an Eligible Employee’s termination of employment shall be deemed as such compensation: regular pay, including compensation for services during regular working hours, overtime, shift differential, commissions, bonuses or other similar payments, and payment for unused accrued sick, vacation or other leave, but only if the Eligible Employee would have been able to use the leave if employment had continued. The exclusions described in this Section 6.05 with respect to post-employment payments shall not apply to payments to an individual who does not currently perform services for the Company by reason of qualified military service under Code Section 414(u)(1), to the extent such payments do not exceed the compensation such individual would

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have received from the Company if he or she had continued to perform services for the Company. The compensation limit in (ii) shall not apply to any contribution for medical benefits after separation from service (within the meaning of Section 401(h) or Section 419A(f)(2) of the Code) which is otherwise treated as an annual addition.

     For purposes of this Section, Limitation Year means the Plan Year.

     Code Section 415 and the regulations thereunder are incorporated herein by reference. Notwithstanding the foregoing, excess annual additions will be corrected through the Employee Plans Compliance Resolution System (EPCRS) as outlined under Revenue Procedure 2008-50. The ability to return excess annual additions under the prior Section 415 regulations shall only be permitted for limitation years beginning before July 1, 2007.

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ARTICLE VII — PAYMENTS TO OR FOR THE ACCOUNT OF PARTICIPANTS OR TERMINATED PARTICIPANTS

     7.01. Restrictions on Payments and Distributions. No money or other property of the Trust shall be paid out or distributed by the Trustee except (a) for the purchase or other acquisition of appropriate investments, (b) for defraying the expenses, including taxes, if any, of administering the Trust as elsewhere herein provided, (c) for the purpose of making distributions to or for the account of Participants at the written direction of the Committee in accordance with the rules set forth below, (d) for the return of Company contributions pursuant to Section 4.05, (e) for the purpose of complying with the limitations described in Article VI or (f) for the purpose of complying with the terms of a qualified domestic relations order (as described in Section 414(p) of the Code). All benefits payable under the Plan shall be paid or provided for solely from the Trust, and the Company assumes no liability or responsibility therefor.

     7.02. Retirement from Employment. Subject to the provisions of Section 7.07, upon termination of a Participant’s employment with the Company at or after his Normal Retirement Age, the Committee shall direct the Trustee to distribute to the Participant the full amount standing to the credit of such Participant’s Accounts. The Participant shall become fully vested in his Accounts on the date he attains his Normal Retirement Age.

     7.03. Disability Retirement. If a physician acceptable to the Committee shall certify to the Committee, on the basis of such medical evidence as it may reasonably require, that a Participant is totally incapable of performing his assigned duties with the Company and is therefore unable to continue in the employ of the Company by reason of the sickness or disability of such Participant which is causing such total incapacity, the Committee shall direct the Trustee to apply the full amount then standing to the credit of such Participant’s Accounts, exclusive of any amount in the Accounts used as security for a loan outstanding to the Participant pursuant to

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Section 7.09, for his benefit as provided in Section 7.07. The Committee’s determination as to whether a Participant has become sick or disabled so as to be unable to continue in the employ of the Company shall be conclusive and binding on all persons.

     7.04. Death Benefits.

          (a) Upon the death of any Participant who has a surviving spouse, the Committee shall direct the Trustee to distribute the full amount standing to the credit of such Participant’s Accounts to the Participant’s surviving spouse, unless the exception provided by paragraph (b) of this Section 7.04 applies.

          (b) The requirement of subsection (a) of this Section 7.04 shall not apply if (i) the Participant elects to designate a Beneficiary other than his spouse and (A) his spouse consents in writing or in any other method in accordance with applicable law to such election, (B) such election designates a Beneficiary which may not be changed without the consent of the spouse (or the consent of the spouse expressly permits designations by the Participant without any requirement of further consent by the spouse), and (C) the spouse’s consent acknowledges the effect of such election and is witnessed by a Plan representative or a notary public, or (ii) if it is established to the satisfaction of the Committee that the consent of the surviving spouse could not have been obtained because there is no spouse, because the spouse cannot be located, or because of other circumstances prescribed by regulations under Section 417(a)(2) of the Code.

     A former spouse shall be treated as a surviving spouse to the extent benefits must be paid to such former spouse upon the Participant’s death pursuant to a qualified domestic relations order (as defined in Section 414(p) of the Code), except that no consent shall be required from such former spouse with respect to the designation of a Beneficiary to receive benefits not subject to said order.

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          (c) If, and only if, a Participant is permitted under this Section 7.04 to designate a Beneficiary other than his surviving spouse, then such Participant’s Accounts shall be distributed in accordance with this subsection (c). Such a Participant shall have the right to designate one or more Beneficiaries, including contingent Beneficiaries, entitled to receive the amount payable in behalf of such Participant under the provisions of this Plan in the event of death. Such designation shall be made in writing in such manner as the Committee shall determine. A Participant may change such designation from time to time, and may revoke such designation, provided, however, that any subsequent designation must meet the requirements of this Section 7.04. Upon the death of any Participant, the Committee shall direct the Trustee to distribute, for the benefit of such Participant’s Beneficiaries and subject to the provisions of Section 7.07, the full amount standing to the credit of the Participant’s Accounts. If a Participant dies without having designated a Beneficiary, or if none of the designated Beneficiaries survives the Participant, or if the Committee is in doubt as to the effective status of a Beneficiary designation, payment of any sum that would otherwise have been payable to such Beneficiary will be made to the first surviving class of the following classes of successive preference Beneficiaries, all members of each class to share equally: the Participant’s (i) surviving spouse; (ii) surviving issue (including adopted children and stepchildren) by right of representation; (iii) surviving parents; (iv) brothers and sisters or their issue by right of representation; and (v) executors and administrators. If a Beneficiary entitled to receive any amount payable in behalf of a Participant dies before receiving the entire amount to which such Beneficiary is entitled, the undistributed balance, together with any income or loss accumulated thereon, shall be distributed to such Beneficiary’s estate in accordance with Section 7.07.

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     7.05. Termination of Employment Prior to Retirement or Death.

          (a) If any Participant’s employment with the Company and all Affiliated Companies terminates under circumstances other than by reason of retirement, disability or death, as provided for under Sections 7.02 through 7.04, he shall be entitled to a vested benefit equal to the sum of (i) 100% of the amount standing to the credit of his Tax Deferred, Voluntary, Company Account II and Rollover Accounts, plus (ii) if the Participant has at least three (3) Years of Vesting Service, 100% of the amount standing to his Company Account.

          (b) The determination of the amount to which such terminated Participant is entitled in accordance with the foregoing rules shall be made by the Committee and communicated to the Trustee.

          (c) Any amount standing to the credit of a Participant’s Company Account to which he is not entitled at the time of his termination of employment shall be forfeited by him upon the earlier of (i) the payment of the full amount to which such Participant is entitled under the Plan or (ii) five (5) consecutive One-Year Breaks in Service by the Participant. For purposes of the preceding sentence, a terminated Participant who is not entitled to receive any amount under the Plan shall be deemed to have received the entire amount to which he is entitled on the date his employment terminates and shall forfeit his entire Company Account as of that date. All such forfeited amounts shall first be applied as described in Section 7.06(b) and then toward the Matching Contributions required to be made under Section 4.03 for the first pay period ending after the date of the forfeiture.

          (d) Effective January 1, 2002, a Participant’s Tax Deferred Contributions, After-Tax Contributions, catch-up contributions, Matching Contributions, and earnings attributable to these contributions shall be distributed on account of the Participant’s severance

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from service. However, such a distribution shall be subject to the other provisions of the Plan regarding distributions, other than provisions that require a separation from service before such amounts may be distributed.

     7.06. Reemployment. If a terminated Participant is reemployed by the Company, he shall be eligible to become an active Participant upon reemployment pursuant to Section 3.03.

     If such a reemployed Participant was not 100% vested under Section 7.05(a) at the time of his prior termination, the following special provisions shall apply:

          (a) If such a terminated Participant is reemployed after five (5) consecutive One-Year Breaks in Service, he shall have no rights with respect to any amounts previously forfeited from his Company Account.

          (b) If such a terminated Participant is reemployed before the date described in (a) above, the full amount, if any, which was forfeited from his Company Account as a result of his prior termination shall be restored to his Company Account as of the date of reemployment. Such restoration shall be made first from amounts forfeited pursuant to Section 7.05(c) and then, to the extent necessary, from a special Company contribution to be made for the purpose of such restoration.

     7.07. Manner and Timing of Distributions.

          (a) Whenever a Participant’s Accounts become distributable pursuant to the provisions of Section 7.02, 7.03, 7.04 or 7.05, distribution of said Accounts shall be made by the payment or commencement of payments of the amount distributable under such one of the following options as the Participant elects pursuant to paragraph (b) of this Section; subject, however to the requirements of Section 7.07(d) below; and provided, however, that Option B will only be available to Participants whose Accounts become distributable pursuant to the

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provisions of Section 7.02 or 7.03 or upon termination of employment after both completing ten (10) Years of Vesting Service and attaining age fifty-five (55):

Option A: One lump sum payment in cash.

Option B: Payments, in cash, in quarterly installments, over a period of five (5), ten (10) or fifteen (15) years, the aggregate amount to be paid under this option having first been segregated into a separate account for such Participant. The amount of each payment hereunder shall be equal to the total amount in the account remaining to be distributed under this Option B divided by the number of payments remaining to be made under this Option B, inclusive of the current payment.

          (b) A Participant who is eligible under subsection (a) above to elect a distribution pursuant to Option B may elect the form of distribution of his Accounts under either of the options set forth in subsection (a) above by filing a written election with the Committee within sixty (60) days of the time his Accounts become payable. In the event that a Participant has not timely filed such an election, distribution of his Accounts shall be made to such Participant in one lump sum payment pursuant to Option A. The value of a Participant’s Accounts shall be determined as of the distribution date.

          (c) Notwithstanding the provisions of paragraph (b) above, the following provisions shall apply:

          (i) Effective March 28, 2005, if the aggregate benefit payable to a Participant exceeds $1,000 but is less than or equal to $5,000, if the Participant does not elect to have such distribution paid directly to an eligible retirement plan specified by the Participant in a direct rollover in accordance with Section 7.12, or to receive a

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distribution directly in one lump sum payment in cash pursuant to Option A, then the Committee will pay the distribution in a direct rollover to an individual retirement plan designated by the Committee. For this purpose, the value of the aggregate benefit payable to a Participant shall be determined by excluding the portion of the aggregate benefit payable that is attributable to Rollover Contributions (and earnings allocable thereto) within the meaning of Sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii) and 457(e)(16) of the Code.

          (ii) Effective March 28, 2005, if the aggregate benefit payable to a Participant does not exceed $1,000, the Committee shall direct the Trustee to distribute such benefit to the Participant in one lump sum payment in cash pursuant to Option A. For this purpose, the value of the aggregate benefit payable to a Participant shall be determined by including the portion of the aggregate benefit payable that is attributable to Rollover Contributions (and earnings allocable thereto) within the meaning of Sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3)A)(ii) and 457(e)(16) of the Code.

          (d) Notwithstanding any provision to the contrary, in order to comply with Sections 401(a)(9), 411(a)(11), and 414(p) of the Code, the following provisions shall apply:

          (i) If the sum of a Participant’s aggregate Account balances to be distributed upon termination of employment is greater than $5,000 (excluding Rollover Contributions and earnings allocable thereto), such Accounts shall not be distributed in whole or in part until the Participant’s Required Beginning Date or until the Participant dies, whichever is earlier, unless the Participant requests such earlier distribution prior to such distribution date. If the amount standing to the credit of the Participant’s Account

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under the Plan does not exceed $5,000, the Account shall be distributed in accordance with the provisions of paragraph (c) of this Section.

          (ii) In no event shall distribution of benefits to a Participant be made (or commenced) later than the April 1 of the calendar year following the calendar year in which such Participant (A) attains age seventy and one-half (70-1/2), or (B) in the case of a Participant who is not a “five-percent owner” (within the meaning of Section 416(i)(1)(B)(i) of the Code), terminates employment with the Company, whichever is later (the Participant’s “Required Beginning Date”).

          (iii) If a Participant dies before his entire interest has been distributed to him as provided in this Article VII, his entire interest shall be distributed to his Beneficiary no later than December 31 of the calendar year containing the fifth anniversary of the Participant’s death; provided, however, that this requirement shall not apply if distributions have commenced pursuant to Option B of Section 7.07 in which event distributions shall continue for the remainder of the period under such option.

          (iv) If, and to the extent, any portion of a Participant’s Accounts is payable to a former spouse pursuant to a qualified domestic relations order within the meaning of Sections 401(a)(13)(B) and 414(p) of the Code, the provisions of said order shall govern the distribution thereof.

          (e) In the case of a distribution to a Participant, the period of years selected under Option B shall be such that the requirements set forth in both (i) and (ii) below are satisfied at the time distribution to such Participant is to commence.

          (i) If someone other than the Participant’s spouse is designated as his Beneficiary, then the period of years over which installment payments are to be paid shall

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be such that any period of years remaining as of the calendar year in which the Participant attains age seventy and one-half (70-1/2) or any subsequent calendar year shall meet the minimum distribution incidental benefit requirement which shall be determined in accordance with regulations promulgated under Section 401(a)(9) of the Code.

          (ii) No form of payment may be elected which would provide for payments to any Participant during any period longer than the life expectancy of the Participant or the joint life and last survivor expectancies of the Participant and his Beneficiary, actuarially determined at the commencement of such payment.

          (f) In no event shall the distribution of a Participant’s Accounts, unless the Participant or Beneficiary otherwise consents in writing, begin later than the sixtieth (60th) day after the close of the Plan Year in which the latest of the following events occurs:

          (i) the Participant’s sixty-fifth (65th) birthday;

          (ii) the tenth (10th) anniversary of the date on which the Participant first became a Participant; or

          (iii) the Participant’s termination of employment with the Company;

provided, notwithstanding any other provision of the Plan,

          (iv) except for benefits payable pursuant to Section 7.07(c) or Article XV, the Company may require that a Participant file a claim for benefits before benefits will commence; or

          (v) if the amount of the payment required to commence on the date determined under this Section 7.07(f) cannot be ascertained by such date, or if it is not possible to make such payment on such date because the Company has been unable to

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locate a Participant after making reasonable efforts to do so, such payment may be postponed as long as it is made, retroactive to such date, no later than sixty (60) days after the earliest date on which the amount of such benefit can be ascertained or the date on which the Participant is located, whichever is applicable.

          (g) All lump sum distributions shall be made in the form of cash, except that effective October 1, 2011 distributions from the Collective Brands Common Stock Fund shall be made in the form of full shares of Collective Brands Common Stock, as applicable (with payment in cash for a fraction of a share) or in cash if elected by the Participant or Beneficiary. The rights extended to a Participant hereunder shall also apply to any Beneficiary or alternate payee of such Participant.

     7.08. Withdrawals During Employment.

          (a) Upon proper notice given to the Committee at least thirty (30) days in advance of a Valuation Date (or such shorter period as the Committee allows), a Participant may at any time during his employment with the Company withdraw all or any portion of the amount (determined as of such Valuation Date) standing to the credit of his Voluntary Account and/or Rollover Account, excluding any outstanding loan amounts with respect to such Accounts. For purposes of this Section 7.08(a), all amounts attributable to After-Tax Contributions made on or after January 1, 1987 shall be treated as a separate contract for purposes of Section 72 of the Code.

          (b) Upon proper notice given to the Committee at least thirty (30) days (or such shorter period as the Committee allows) prior to a Valuation Date and if the Participant has withdrawn the full amount, if any, available for withdrawal from his Voluntary and Rollover Accounts as provided in subsection (a) above, a Participant who has made either Tax Deferred or

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After-Tax Contributions to the Plan for a period of at least sixty (60) months (whether or not continuous) may at any time during such Participant’s employment withdraw all or any portion of the amount (determined as of such Valuation Date) standing to the credit of the Participant’s Company Account.

          (c) A Participant who has attained age fifty-nine and one-half (59-1/2) shall be entitled to withdraw all or any portion of his vested Accounts. The amount to be withdrawn for any in-service withdrawal pursuant to this Section 7.08(c) shall be charged against the Participants’ Accounts in the following order: his Voluntary Account; his Rollover Account; his vested Company Account; his Company Account II; his Tax Deferred Account.

          (d) Upon proper notice to the Committee at least thirty (30) days (or such shorter period as the Committee allows) prior to a Valuation Date, and if the Participant has withdrawn the full amount, if any, available for withdrawal from his Voluntary, Rollover and Company Accounts as provided in subsections (a) and (b) above, the Participant may at any time during his employment with the Company withdraw all or any portion of the vested amount (determined as of such Valuation Date) standing to the credit of his Tax Deferred and Company Accounts, excluding any outstanding loan amounts with respect to such Accounts, but only in order to meet a “Financial Hardship;” provided, however, that any amount in a Participant’s Tax Deferred Account in excess of the sum of his Tax Deferred Contributions and the earnings credited to his Tax Deferred Account as of December 31, 1988 (to the extent such contributions and earnings have not been previously withdrawn) shall not be available for withdrawal. The determination that the Participant is faced with a Financial Hardship and of the amount required to meet such Financial Hardship which is not reasonably available from other resources of the Participant shall be made by the Committee in accordance with uniform and non-discriminatory

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standards and policies which shall be adopted by the Committee and consistently applied to each application for a withdrawal pursuant to this Section 7.08(d). For purposes of this Section 7.08(c), “Financial Hardship” shall mean an immediate and heavy financial need which such Participant is not able to meet from any other reasonably available resources. In determining that such Participant is not able to meet such Financial Hardship from any other sources, the Committee may reasonably rely upon the written certification of the Participant given in accordance with the regulations under Section 401(k). Subject to the foregoing and the requirements of Section 401(k) of the Code and any regulations thereunder, the term “Financial Hardship” shall mean and include the following:

          (i) the purchase (excluding mortgage payments) of a principal residence of the Participant;

          (ii) the payment of tuition, related educational fees, and room and board expenses, for up to the next 12 months of post-secondary education for the Participant, his spouse, children or dependents (as defined below); or

          (iii) medical expenses described in Section 213(d) of the Code which are incurred by the Participant, his spouse or any dependent (as defined in Section 152 of the Code, without regard to Section 152(b)(1), (b)(2) and (d)(1)(B)), and which are not covered by insurance; or

          (iv) the need to prevent an eviction or mortgage foreclosure on the Participant’s principal residence; or

          (v) the payment for burial or funeral expenses for the Participant’s deceased parent, spouse, children or dependents (as defined in Section 152 of the Code, without regard to Section 152(d)(1)(B)); or

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          (vi) the payment of expenses for the repair of damage to the Participant’s principal residence that would qualify for the casualty deduction under Section 162 of the Code (determined without regard to whether the loss exceeds any applicable threshold amount of adjusted gross income).

     No more than one withdrawal may be made pursuant to this Section 7.08(d) within any Plan Year, provided, however, that up to four withdrawals may be made in a twelve-month period if each is determined by the Committee to be in respect of a “Financial Hardship” described in (ii) above. Any withdrawal made pursuant to this Section 7.08(d) shall be charged against a Participant’s Accounts in the following order: his Tax Deferred Account; his Company Account.

     The amount of any withdrawal made pursuant to this Section 7.08(d) shall include any amounts necessary to pay any Federal, state or local income taxes or penalties reasonably anticipated to result from the distribution.

          (e) Subject to such restrictions as may be applicable to the particular Investment Funds, in the event of an in-service withdrawal of less than the entire balance in a Participant’s Account, amounts shall be withdrawn from the Investment Funds pro rata in proportion to the interest of such Account in each Investment Fund. In the case the Participant is subject to Section 16 of the Securities Exchange Act of 1934 or has been designated as a “Designated Insider,” such Participant’s withdrawal will be taken first from such Participant ‘s Investment Funds other than the Collective Brands Common Stock Fund.

          (f) All withdrawals under this Section 7.08 shall be made as soon as practicable after the Valuation Date next following timely receipt by the Committee of the Participant’s written notice. No more than one withdrawal may be made pursuant to Sections

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7.08(a), (b) and (c) within any Plan Year. No withdrawal shall be made pursuant to this Section 7.08 for less than the lesser of (i) $500 or (ii) the maximum amount available for withdrawal.

     7.09. Loans to Participants. Upon proper application of a Participant submitted to the Committee at least thirty (30) days (or such shorter period as the Committee allows) prior to a Valuation Date, the Committee may direct the Trustee to lend to such Participant such amount or amounts from his Accounts, up to the total aggregate value of such Accounts as of such Valuation Date, as the Committee may determine proper, provided that the aggregate amount of all outstanding loans, including accrued interest, from the Plan and any other qualified plan maintained by the Company or an Affiliated Company to a Participant shall not exceed the lesser of:

          (i) $50,000, reduced by the excess, if any, of the highest outstanding balance of any other loan to the Participant from the Plan or any other plan maintained by the Company during the preceding 12-month period over the outstanding balance of such loans on the date on which such loan is to be made; or

          (ii) fifty percent (50%) of the total aggregate value of the vested amount of said Participant’s Accounts under the Plan and all other plans maintained by an Affiliated Company.

Notwithstanding the foregoing, the minimum amount which may be loaned to a Participant under this Section 7.09 shall be $500, and a Participant may not have more than one loan outstanding under this Section 7.09 at any given time. A Participant’s Accounts may be charged with a reasonable loan administrative fee.

     Loans shall be made available to all Participants on a reasonably equivalent basis, except that the Committee may make reasonable distinctions based upon credit-worthiness, other

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obligations of the Participant and other factors that may adversely affect the ability to assure repayment. The decision as to whether a loan shall or shall not be made in any case shall rest solely within the discretion of the Committee, such discretion to be exercised consistently with the provisions of Section 9.05 and with such procedures as the Committee may establish pursuant to this Section 7.09. Loans approved under this Section 7.09 shall be made as soon as reasonably practicable after the Valuation Date next following timely receipt by the Committee of the Participant’s written application.

     Each such loan shall be made at such reasonable rate of interest as the Committee may determine, shall be subject to such other terms and conditions as the Committee may deem proper, and shall be evidenced by the promissory note of the Participant and secured by fifty percent (50%) of the Participant’s vested interest in the Plan. Each such loan shall be repaid by payroll deduction (unless prohibited by applicable state law) or by such other means as may be authorized by the Committee, shall be amortized over the term of the loan in level payments made not less frequently than quarterly, and shall be repaid within five (5) years unless such loan is used to acquire a dwelling unit which within a reasonable period of time is to be used (determined at the time the loan is made) as the principal residence of the Participant in which case the repayment period shall not exceed twenty (20) years. Notwithstanding the foregoing, a Participant may prepay the entire outstanding balance of a loan as of the last day of any calendar month.

     Each such loan shall be deemed to be an investment made at the direction of such Participant and shall be credited to a separate investment Account for the borrowing Participant. The amount of the loan shall be charged against the Participant’s Accounts in the following

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order: his Tax Deferred Account; his Rollover Account; his Company Account; his Voluntary Account.

     Subject to such restrictions as may be applicable to the particular Investment Funds, in the event of a loan of less than the entire balance of a Participant’s Account, the loan amounts shall be withdrawn from the Investment Funds pro rata in proportion to the interest of such Account in each of such Investment Funds. In the case the Participant is subject to Section 16 of the Securities Exchange Act of 1934 or has been designated as a “Designated Insider,” such Participant’s loan will be taken first from such Participant’s Investment Funds other than the Collective Brands Common Stock Fund. All interest and loan repayments shall be credited to the appropriate Accounts of such Participant and shall be reinvested in the Investment Funds in accordance with the most recent investment election of such Participant with respect to contributions credited to such Accounts. All expenses incurred by the Committee and the Trustee, including reasonable attorneys’ fees and court costs, as a result of a default by a Participant shall be charged against the Participant’s Accounts.

     If any loan under this Section 7.09 is in default, as determined in accordance with the procedures established by the Committee, when any part or all of the amount standing to the credit of a Participant’s Accounts is to be distributed to such Participant or his Beneficiary, the Committee shall direct the Trustee to apply the amount of such distribution in payment of the entire outstanding loan principal, whether or not then due, and any interest theretofore accrued, before distributing the balance, if any, to the Participant or his Beneficiary.

     7.10. Payments to Incompetents. If any person entitled to receive any benefits hereunder is a minor, or is in the judgment of the Committee, legally, physically, or mentally incapable of personally receiving and receipting for any distribution, the Committee may instruct

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the Trustee to make distribution to such other person, persons or institutions who, in the judgment of the Committee, are then maintaining or have custody of such distributee. As a condition to the issuance of such instruction for the distribution to such other person or institution, the Committee may require such person or institution to exhibit or to secure an order, decree or judgment of a court of competent jurisdiction with respect to the incapacity of the person who would otherwise be entitled to receive the benefits.

     7.11. Discharge of Obligation to Make Payments. Whenever the Trustee is required to make any payment or payments to any person in accordance with the provisions of this Article VII or Article VIII, the Committee shall notify the Trustee in writing of such person’s last known address as it appears in the Committee’s records; and the obligations of the Trustee and the Committee to make such payment or payments shall be fully discharged by mailing the same to the address specified by the Committee.

     7.12. Direct Rollovers. Notwithstanding any provision of the Plan to the contrary that would otherwise limit a distributee’s election under this Section, a distributee may elect, at the time and in the manner prescribed by the Committee, to have any portion of an eligible rollover distribution paid directly to an eligible retirement plan specified by the distributee in a direct rollover.

     Definitions. Whenever used in this Section, the following words shall have the following meanings:

          (a) Eligible rollover distribution: Eligible rollover distribution shall have the meaning prescribed by Section 402(f) of the Code. For purposes of this Section 7.12 of the Plan, any amount that is distributed on account of hardship shall not be an “eligible rollover

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distribution” and the distributee may not elect to have any portion of such a distribution paid directly to an “eligible retirement plan.”

     A portion of a distribution shall not fail to be an eligible rollover distribution merely because the portion consists of after-tax employee contributions which are not includible in gross income. However, such portion may be transferred only to (i) an individual retirement account or annuity described in Sections 408(a) or (b) of the Code; or (ii) a qualified trust or to an annuity contract described in Code Section 403(b), if such trust or contract provides for separate accounting for amounts so transferred (including interest thereon), including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not so includible.

          (b) Eligible retirement plan: Eligible retirement plan shall have the meaning prescribed by Section 402(f) of the Code. For purposes of this Section 7.12 of the Plan, an “eligible retirement plan” shall also mean an annuity contract described in Section 403(b) of the Code and an eligible plan under Section 457(b) of the Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this Plan. The definition of “eligible retirement plan” shall also apply in the case of a distribution to a surviving spouse or to a spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in Section 414(p) of the Code. Effective on and after January 1, 2008, “an eligible retirement plan” shall also mean, to the extent permitted by Section 408A of the Code, a Roth IRA described in such Section.

          (c) Distributee: A distributee includes an employee or former employee. In addition, the employee’s or former employee’s surviving spouse and the employee’s or former

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employee’s spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in Section 414(p) of the Code, are distributees with regard to the interest of the spouse or former spouse. Moreover, effective January 1, 2010, a designated non-spouse beneficiary may be a distributee, but only with respect to an eligible retirement plan that is an individual retirement account or annuity described in Section 408(a) or (b) of the Code or to a Roth IRA described in Section 408A of the Code.

          (d) Direct rollover: A direct rollover is a payment by the Plan to the eligible retirement plan specified by the distributee.

     Notwithstanding the foregoing, a distribution may commence less than 30 days after the notice required under Section 1.411(a)-11(c) of the Income Tax Regulations and the notice described in Section 7.14 are given to a Participant, provided that:

          (a) the Committee clearly informs the Participant that the Participant has a right to a period of at least 30 days after receiving the notices to consider the decision of whether or not to elect a distribution (and, if applicable, a particular distribution Option) and whether or not to elect a direct rollover, and

          (b) the Participant, after receiving the notices, affirmatively elects a distribution before the 30 day period has elapsed.

     7.13. Notification Of Eligibility To Receive And Consent To Vested Benefits.

          (a) Notice. In the event that the aggregate vested Account balance of a Participant to be distributed pursuant to Section 7.03 or 7.05 exceeds $5,000 (excluding Rollover Contributions and earnings thereon), such Participant shall receive from the Company, during the period beginning not more than 180 days before the Valuation Date as of which distribution is made, a written notification. The notification shall disclose:

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          (i) the material features and the relative values of his or her benefits under the optional forms of benefit available under the Plan;

          (ii) the value of his or her benefits under the Plan; and

          (iii) his or her right to defer receipt of vested benefits.

          (b) Consent. The Participant’s consent to the distribution of the vested portion of his or her Accounts must be:

          (i) in writing;

          (ii) made after the Participant receives the written notice described in the preceding sentence; and

          (iii) made within 180 days before the Valuation Date as of which distribution to the Participant is to be made.

     7.14. Written Explanation Of Rollover Treatment. The Company shall, when making an eligible rollover distribution, provide a written explanation to the recipient of such distribution of his or her right to roll over such distribution to an eligible retirement plan and, if applicable, his or her right to the special ten year averaging and capital gains tax treatment in the Code. Such written explanation will be provided to the recipient in accordance with rules prescribed by the Internal Revenue Service.

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ARTICLE VIII — AMENDMENT AND TERMINATION

     8.01. Right to Amend or Terminate. The Company reserves the right at any time and from time to time to amend this Plan, or discontinue or terminate the Plan by delivering to the Committee and the Trustee a copy of an amendment or appropriate Board of Directors’ resolution of discontinuance or termination certified by an officer of the Company; provided, however, that except as provided in Section 8.02, the Company shall have no power to amend or terminate this Plan in such manner as would cause or permit (a) any of the Trust assets to be diverted to purposes other than for the exclusive benefit of the Employees of the Company or their Beneficiaries; (b) any reduction in the amount theretofore credited to any Participant; (c) any portion of the Trust assets to revert to or become the property of the Company; (d) the rights and responsibilities of the Committee or the Trustee to be increased without their written consent, and/or (e) the elimination of an optional form of benefit with respect to amounts credited to a Participant’s Accounts before the amendment unless such elimination is permitted pursuant to the regulations under Code Section 411(d)(6). Notwithstanding the foregoing, subject to Sections 9.04, 9.05, 9.06 and 9.07, the Company hereby delegates to the Committee the power to amend Appendix A of the Plan.

     8.02. Amendment for Tax Exemption. The Company reserves the right to amend this Plan and the Trust in such manner as may be necessary or advisable so that said Trust may continue to qualify as an exempt employees’ trust under the provisions of the Code as now in force or as it may hereafter be changed or amended; and any such amendment may be made retroactively.

     8.03. Liquidation of Trust in Event of Termination. In the event of termination or partial termination (within the meaning of Section 411(d)(3) of the Code) of this Plan and the Trust, or complete discontinuance of contributions thereto by the Company, the rights of all

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Participants (or in the case of a partial termination, the rights of Participants affected thereby) to amounts theretofore credited to all their Accounts shall be fully vested and nonforfeitable. In the event of such termination or discontinuance, the Trustee shall, subject to the direction of the Committee, hold the assets of the Trust in accordance with the provisions of the Plan and distribute such assets from time to time to Participants entitled thereto in accordance with such provisions.

     8.04. Termination of Plan and Trust. This Plan and the Trust shall in any event terminate whenever all property held by the Trustee shall have been distributed in accordance with the terms hereof.

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ARTICLE IX — ADMINISTRATION OF THE PLAN

     9.01. Named Fiduciaries. The named fiduciaries with respect to the Plan shall be the Company, the Committee and the Trustee. The Company shall be the “plan administrator” of the Plan for all purposes of ERISA. The responsibilities of the named fiduciaries shall be allocated as provided herein, and each such fiduciary shall have only those responsibilities and obligations that are specifically imposed upon it by this Trust Agreement or by applicable law. It is intended that each of the named fiduciaries shall be responsible for the proper exercise of its own powers, duties, responsibilities, and obligations under the Plan and shall not be responsible for any act or omission of any other fiduciary. The Company and the Committee, as named fiduciaries, shall be entitled to delegate all or any part of their fiduciary responsibilities, and obligations to any other person or entity. In the event of any such delegation, (a) the named fiduciary shall not be liable for any act or omission of the person to whom the responsibility has been delegated as long as the selection and retention of such person is prudent and (b) the person to whom the fiduciary powers and obligations are delegated shall be responsible only for the proper exercise of the powers, duties, responsibilities, and obligations that have been specifically delegated to him. The responsibilities of the named fiduciaries are:

          (i) The Company shall have the sole responsibility to appoint and remove (in accordance with the Trust Agreement) the Trustee and successor Trustee, to appoint and remove or replace the members of the Committee as herein provided, and shall have such other powers and do such other things as are herein specifically provided.

          (ii) The Trustee shall, except as otherwise specifically provided in this Agreement, have the sole responsibility for the investment and control of the assets of the Plan and Trust in accordance with the terms hereof.

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          (iii) The Committee shall have the sole responsibility for the general administration of the Plan and for carrying out its provisions. In addition, the Committee shall have such powers and responsibilities as are herein specifically provided.

The Committee shall conduct its business in accordance with the terms of this Article IX.

     9.02. Appointment of Committee. The Company shall appoint a Committee of three or more persons, any or all of whom may be officers or employees of the Company or any other individuals, to be known as the “Collective Brands Retirement & Investment Committee.” The members of the Committee shall serve at the pleasure of and may be removed by the Company. Vacancies in the Committee arising by resignation, death, removal, or otherwise shall be filled by the Company. The number of members of the Committee shall be as designated by the Company from time to time. The Trustee shall accept and may rely upon a certification by the Company as to the number and identity of the individuals comprising the Committee from time to time.

     9.03. Powers of Committee. The Committee shall have all the discretionary powers and authority necessary in order to carry out its duties and responsibilities in connection with the administration of the Plan and, subject to the Trust Agreement, the Trust as herein provided, and the Committee may make such rules and regulations as it may deem necessary or desirable to carry out the provisions of the Plan and, subject to the Trust Agreement, the Trust. The Committee shall determine any question arising in the administration, interpretation, and application of the Plan and Trust, including any question submitted by the Trustee on a matter necessary for them properly to discharge their duties, and including without limitation all questions concerning eligibility, elections, contributions, designation and benefits under the Plan. The Committee shall construe all terms of the Plan, including any uncertain terms, and shall

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make all factual determinations and determine all questions concerning administration of the Plan. The decision of the Committee shall be conclusive and binding on all persons. The Committee may make any corrections necessary under the Plan to retain the qualified status of the Plan under Section 401(a) of the Code. Such corrections shall include, but are not limited to, any corrections described in the Internal Revenue Service’s Employee Plans Compliance Resolution System and any similar program. Any determination made by the Committee under the Plan or in connection with the administration or interpretation shall be given deference in the event it is subject to judicial review and shall be overturned only if it is arbitrary and capricious.

     9.04. Action by Committee. The Committee shall act by a majority of its members at the time in office and such action may be taken by vote at a meeting or in writing without a meeting. The Committee may by such majority action authorize any one or more of its members to execute any direction or document or take any other action on behalf of the Committee, and in such event any one of the members of the Committee may certify in writing to the Trustee or any other person the taking of such action and the name or names of the members of the Committee so authorized, including himself. The execution of any direction, document, or certificate on behalf of the Committee by any of its members shall constitute his certification of his authority with respect thereto, and the Trustee or other person shall be protected in accepting and relying upon any such direction, document, or certificate and is released from inquiry into the authority of any of the members of the Committee. Notwithstanding anything to the contrary elsewhere herein, no member of the Committee shall take any action as a member of the Committee with respect to any matter concerning himself as a Participant of the Plan.

     9.05. Discretionary Action. Wherever under the provisions of this Agreement the Committee is given any discretionary power or authority, such power or authority shall not be

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exercised in such manner as to cause any discrimination in favor of or against any Employee or class of Employees.

     9.06. Evidence on Which Committee May Act. In taking any action or determining any fact or question which may arise under this Plan and Trust, the Committee may, with respect to the affairs of the Company or its Employees, rely upon any statement by the Company with respect thereto. In the event that any dispute may arise regarding the payment of any sums or regarding any act to be performed by the Committee or the Trustee, the Committee may in its sole discretion direct that such payment be retained or postpone or direct the postponement of the performance of such act until actual adjudication of such dispute shall have been made in a court of competent jurisdiction, or until the Company, the Committee, and/or the Trustee shall have been indemnified against loss to the satisfaction of the Committee; provided, however, that in the event of any such dispute, the Committee may rely upon and act in accordance with any directions received from the Company.

     9.07. Employment of Agents. The Committee may employ agents, including, but not limited to, custodians, accountants, consultants, or attorneys, to exercise and perform such of the powers and duties of the Committee hereunder as the Committee may delegate to them, and otherwise to render such services to the Committee as the Committee may determine, and the Committee may enter into agreements setting forth the terms and conditions of such service. The Committee may appoint an independent public accountant to audit the Plan. The compensation of such agents shall be an expense chargeable in accordance with Section 9.08. The Committee shall be fully protected in delegating any such power or duty to or in acting upon the advice of any such agent, in whole or in part, and except as may be required by Federal law, shall not be

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liable for any act or omission of any such agent, the Committee’s only duty being to use reasonable care in the selection and retention of any such agent.

     9.08. Compensation and Expense of Committee. The members of the Committee shall serve without compensation for services as such. The reasonable expenses of the Committee shall be paid by the Trust; provided, the Company in its sole discretion may elect to pay any of such expenses. To the extent any expenses which are paid out of the Trust are properly allocable to an Investment Fund, they shall be so allocated and charged. Such expenses shall include any expenses incident to the functioning of the Trust, including, but not limited to, attorneys’ fees and the compensation of other agents, accounting and clerical charges, expenses, if any, of being bonded as required by ERISA, recordkeeping fees, consultants’ fees, Plan investment costs and other costs of administering the Trust.

     9.09. Indemnification of Committee Members. The Company shall indemnify and hold harmless each member of the Committee from and against any and all claims, losses, damages, expenses (including reasonable attorneys’ fees approved by the Company), and liability (including any reasonable amounts paid in settlement with the Company’s approval), arising from any act or omission of such member, except when the same is judicially determined to be due to the willful misconduct of such member.

     9.10. Review of Domestic Relations Orders. The Committee shall determine whether any domestic relations order received by the Plan is “qualified” within the meaning of Section 414(p) of the Code. Upon receipt of a domestic relations order, the Committee (a) shall promptly notify the Participant and each alternate payee under said order of the receipt by the Committee of said order and its procedures for determining the qualified status of said order, and (b) shall direct the Trustee to separately account for any amounts payable to an alternate payee

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pursuant to said order. Within a reasonable time thereafter, the Committee shall determine whether such order is a qualified domestic relations order and shall notify the Participant and each alternate payee of such determination.

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ARTICLE X — TRUST FUND

     10.01. Trust Agreement. The Company shall enter into a Trust Agreement with such Trustee as it may determine, creating a Trust for the purpose of providing benefits under the Plan, in such form and containing such provisions as the Company may deem appropriate. All contributions made by the Company under the Plan shall be held, managed and invested by the Trustee in accordance with the provisions of the Trust Agreement for the purposes contemplated by the Plan.

     10.02. Combined Trust. The Trust established pursuant to Section 10.01 may be utilized for the purpose of providing benefits under one or more other qualified plans maintained by the Company, and all references to the Trust under this Agreement shall refer to the portion of such combined Trust consisting of the assets of this Plan. In such event, the Trustee shall maintain adequate records to establish at all times the equitable share of the assets of the combined Trust allocable to this Plan. Such assets shall be used solely to provide benefits under, and expenses and other charges properly allocable to the Plan, and shall not be used for the payment of benefits under, or expenses or other charges properly allocable to, any other plan.

     10.03. Transfer from Other Plans. With the approval of the Trustee, the Company may have assets of any other plan maintained by it or another employer which satisfies the requirements of Section 401(a) of the Code transferred to the Trust and consolidated with assets of this Plan. Any such transfer shall be accompanied by the transfer of such existing records and information as determined by the Trustee to be necessary for the proper administration of the Plan.

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ARTICLE XI — THE COMPANY

     11.01. No Contract of Employment. Neither this Plan nor the Trust shall be construed as creating any contract of employment between the Company and any Participant, Employee, or other person, and nothing herein contained shall give any person the right to be retained in the employ of the Company or otherwise restrain the Company’s right to deal with its employees, including Participants and Employees, and their hiring, discharge, layoff, compensation, and all other conditions of employment in all respects as though this Trust did not exist.

     11.02. No Contract to Maintain Plan. The Company by the creation of the Plan does not enter into any agreement to maintain the Plan or to make any future contributions thereto or reimbursement of expenses incurred hereunder. Each contribution by the Company shall be voluntary, and the Company reserves the right to suspend payment of its contributions hereunder, and no party hereto or Participant or any other person shall have any cause or right of action against the Company by reason of any failure by the Company to make contributions to the Trust, or by reason of any action by the Company in terminating the Plan and Trust.

     11.03. Liability of the Company. Subject to its agreement to indemnify the members of the Committee as provided in Section 9.09, neither the Company nor any person acting in behalf of the Company shall be liable for any act or omission on the part of any member of the Committee, or on the part of the Trustee, or for any act performed or the failure to perform any act by any person with respect to the Plan, or the Trust, the Company’s only duty being to use reasonable care in the selection and retention of the Trustee and the members of the Committee.

     11.04. Action by the Company. Whenever under the terms of this Plan the Company is permitted or required to take any action, such action shall be taken by the Board of Directors, or any duly authorized committee thereof, or by any officer of the Company thereunto duly authorized, by the Board of Directors or otherwise. In such event, any such officer may certify

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to the Committee or the Trustee or any other person the taking of such action and the name or names of the officers so authorized, including himself or herself. The execution of any direction, document, or certificate on behalf of the Company by any of its officers shall constitute a certification of the authority of such officer with respect thereto, and the Committee, the Trustee, or other person shall be protected in accepting and relying upon any such direction, document, or certificate and are released from inquiry into the authority of any officer of the Company.

     11.05. Successor to Business of the Company. Unless this Plan and the Trust be sooner terminated, a successor to the business of the Company, by whatever form or manner resulting, may continue the Plan and Trust by executing an appropriate supplementary agreement and such successor shall ipso facto succeed to all the rights, powers, and duties of the Company hereunder. The employment of any Employee who has continued in the employ of such successor shall not be deemed to have been terminated or severed for any purposes hereunder.

     11.06. Dissolution of the Company. If the Company is dissolved by reason of bankruptcy or insolvency or otherwise, without any provision being made for the continuation of this Plan and the Trust by a successor to the business of the Company, the Plan and the Trust shall terminate, and the Trustee shall proceed in the same manner as though the Plan and the Trust were being terminated by the Company as provided in Section 8.03.

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ARTICLE XII — ADDITIONAL PARTICIPATING COMPANIES

     12.01. Participation. Any subsidiary or affiliate of the Company may, with the consent of the Company, become a participating employer by action of the board of directors of such subsidiary or affiliate adopting the Plan and Trust Agreement as a Plan and Trust Agreement for the benefit of its employees. Any such additional participating employer is hereinafter referred to in this Article XII as a “Participating Subsidiary.”

     12.02. Effective Date. The participation of any Participating Subsidiary shall take effect as of the date of its action to adopt the Plan and Trust Agreement or such other date as it may specify with the Company’s approval.

     12.03. Administration. Each Participating Subsidiary shall be deemed the “Company” and shall have and exercise all the rights, powers, and duties thereof with respect to the Plan as applied to itself and its employees and that part of the Trust which represents Accounts of Participants employed by it. Subject to Section 12.04, each Participating Subsidiary hereby authorizes The Stride Rite Corporation to exercise on its behalf all such rights, powers, and duties, including amendment or termination of the Plan, appointment of the Trustee and the members of the Committee, and serving as the “plan administrator” of the Plan for purposes of ERISA. Each participating employer, including the Company and each Participating Subsidiary, shall make contributions hereunder on behalf of its employees in accordance with Article IV.

     12.04. Termination. If the Plan shall be terminated by any one Participating Subsidiary, the Trust shall be valued and the Accounts of all Participants adjusted pursuant to Section 5.06 and assets representing the Accounts of all Participants employed by such Participating Subsidiary shall be segregated into a separate trust and held subject to the provisions of the Plan, and all rights, powers, and duties of the Company with respect to such separate trust shall be exercised by such Participating Subsidiary.

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ARTICLE XIII — TOP-HEAVY PROVISIONS

     13.01. General Rule. For any Plan Year for which this Plan is a “top-heavy plan” as defined in Section 13.03 below, any other provisions of this Plan to the contrary notwithstanding, this Plan shall be subject to the minimum contribution provisions set by Section 13.02.

     13.02. Minimum Contribution Provisions. Each Participant who is a non-key employee (as defined in Section 13.06 below) and who is an Employee as of the last day of such Plan Year shall be entitled to a minimum contribution equal to the lesser of (a) three percent (3%) of such Participant’s compensation for such Plan Year, or (b) the percentage at which contributions are made for the key employee (as defined in Section 13.05 below) for whom such percentage is the highest for such Plan Year; provided, if such Participant is also a non-key employee covered under a top-heavy defined benefit plan maintained by the Company or an Affiliated Company, such Participant shall be entitled to a minimum benefit under such defined benefit plan instead of the minimum contribution described in this Section 13.02. For purposes of this Section 13.02, “compensation” shall be determined within the meaning of Section 415 of the Code as described in Section 6.05; provided, however, compensation means compensation during the Plan Year or such other consecutive 12-month period over which compensation is otherwise determined under the Plan (the determination period). Effective for purposes of determining whether the Plan satisfies the minimum benefit requirements of Section 416(c) of the Code for Plan Years beginning after December 31, 2001 in which the Plan is determined to be top-heavy, additional Matching Contributions shall be taken into account for purposes of satisfying the minimum contribution requirements of Section 416(c)(2) of the Code and the Plan. The preceding sentence shall apply with respect to additional Matching Contributions under the Plan or, if the Plan provides that the minimum contribution requirement shall be met in another plan, such other plan. Additional Matching Contributions that are used to satisfy the minimum contribution

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requirements shall be treated as matching contributions for purposes of the actual contribution percentage test and other requirements of Section 401(m) of the Code.

     13.03. Top-Heavy Plan Definition. This Plan shall be a “top-heavy plan” for any Plan Year if, as of the determination date (as defined in Section 13.03(a) below), the sum of all Accounts under the Plan for Participants (including former Participants) who are Key Employees (as defined in Section 13.05 below) exceeds sixty percent (60%) of the sum of all Accounts under the Plan for all Participants (excluding the Accounts of Former Key Employees) unless the Plan is part of an aggregation group or if this Plan is part of an aggregation group (as defined in Section 13.03(b) below) which for such Plan Year is a “top-heavy group” (as defined in Section 13.03(c) below). Solely for purposes of this Section 13.03, a Participant’s Account shall include any distribution made in the five (5) year period (one (1) year period effective January 1, 2002) ending on the determination date, and any contribution due but unpaid as of the determination date.

          (a) “Determination date” means for any Plan Year the last day of the immediately preceding Plan Year; provided, the determination date for the first Plan Year shall be the last day of such first Plan Year. If two or more plans are being aggregated, they shall be aggregated by adding together the results for each plan as of the determination dates for such plans that fall within the same calendar year.

          (b) “Aggregation group” means the group of plans, if any, that includes the group of plans that are required to be aggregated and, if the Committee so elects, the group of plans that are permitted to be aggregated.

          (i) The group of plans that are required to be aggregated (the “required aggregation group”) includes:

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          (A) each plan (including any terminated plan maintained within the five (5) year period (one (1) year period effective January 1, 2002) ending on the determination date) of the Company and of any Affiliated Company in which a Key Employee is a member, and

          (B) each other plan (including any terminated plan maintained within the five (5) year period (one (1) year period effective January 1, 2002) ending on the determination date) of the Company and any Affiliated Company which enables a plan in which a Key Employee is a member to meet the requirements of either Section 401(a)(4) or Section 410 of the Code.

          (ii) The plans that are permitted to be aggregated (the “permissive aggregation group”) include any plan that is not part of the “required aggregation group” that the Committee certifies as constituting a plan within the “permissive aggregation group.” Such plans may be added to the “permissive aggregation group” only if, after the addition, the “aggregation group” as a whole continues to meet the requirements of both Section 401(a)(4) and Section 410 of the Code.

          (c) “Top-heavy group” means the “aggregation group” if, as of the applicable determination date, the sum of the present value of the accrued benefits for Key Employees under all defined benefit plans included in the “aggregation group” plus the aggregate of the Accounts of Key Employees under all defined contribution plans included in the “aggregation group” exceeds sixty percent (60%) of the sum of the present value of the accrued benefits for all Key Employees and Non-Key Employees under all such defined benefit plans plus the aggregate Accounts for all Key Employees and Non-Key Employees under such defined contribution plans. Solely for purposes of this subsection (c), the accrued benefits of Non-Key Employees

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shall be determined under (i) the method, if any, that uniformly applies for accrual purposes under all defined benefit plans maintained by the Company and any Affiliated Company, or (ii) if there is no such method, as if such benefit accrued not more rapidly than the slowest accrual rate permitted under Section 411(b)(1)(C) of the Code.

     For purposes of determining whether the Plan is a top-heavy plan under Section 416(g) of the Code for Plan Years beginning after December 31, 2001, the present values of accrued benefits and the amounts of account balances of a Participant as of the determination date shall be increased by the distributions made with respect to the Participant under the Plan and any plan aggregated with the Plan under Section 416(g)(2) of the Code during the one year period ending on the determination date. The preceding sentence shall also apply to distributions under a terminated plan which, had it not been terminated, would have been aggregated with the Plan under Section 416(g)(2)(A)(i) of the Code. In the case of a distribution made for a reason other than severance from employment, death, or disability, this provision shall be applied by substituting “five (5) year period” for “one year period.” The accrued benefits and accounts of any individual who has not performed services for the employer during the one year period ending on the determination date shall not be taken into account.

          (d) In determining whether this Plan constitutes a “top-heavy plan,” the Committee shall follow the rules set forth in Section 416 of the Code and regulations pertaining thereto.

     13.04. Former Key Employee. The term “Former Key Employee” means any person presently or formerly employed by an Affiliated Company (and the Beneficiaries of such person) who during the Plan Year is not classified as a Key Employee but who was classified as a Key Employee in a previous Plan Year; provided, however, that a person who has not performed any

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services for an Affiliated Company at any time during the one-year period ending on the determination date (and the Beneficiaries of any such person) shall not be considered a Former Key Employee.

     13.05. Key Employee. The term “Key Employee” means any person presently or formerly employed by an Affiliated Company (and the Beneficiaries of such person) who is a “key employee” as that term is defined in Section 416(i) of the Code and the regulations thereunder; provided, however, that a person who has not performed any services for an Affiliated Company at any time during the one-year period ending on the determination date (and the Beneficiaries of any such person) shall not be considered a Key Employee.

     13.06. Non-Key Employee. The term “Non-Key Employee” means any person presently or formerly employed by an Affiliated Company (and the Beneficiaries of such person) who is not a Key Employee or a Former Key Employee; provided, however, that a person who has not performed any services for an Affiliated Company at any time during the one-year period ending on the determination date (and the Beneficiaries of any such person) shall not be considered a Non-Key Employee.

     13.07. Termination of Top-Heavy Status. If the Plan has been deemed to be top-heavy for one or more Plan Years and thereafter ceases to be top-heavy, the provisions of this Article XIII shall cease to apply to the Plan effective as of the day following the determination date on which it is determined to no longer be top-heavy.

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ARTICLE XIV — MISCELLANEOUS

     14.01. Spendthrift Provision. To the maximum extent permitted by law, it is a condition of the Plan, to which all rights of each Participant shall be subject, that no beneficial right or interest of any Participant in the Plan or in the Trust shall be assignable or transferable in whole or in part, either directly or indirectly, by operation of law or otherwise, including but not by way of limitation, execution, levy, garnishment, attachment, pledge, bankruptcy, alienation, transfer, encumbrance, mortgage, or in any other manner, but excluding devolution by death or acquisition by a guardian or committee of a mental incompetent, and no rights or interest of any Participant in the Plan or in the Trust shall be liable for or subject to any obligation or liability of such Participant except (a) as provided by Section 401(a)(13)(C) of the Code with respect to judgments, orders, and decrees issued, and settlement agreements entered into, on and after August 5, 1997, and (b) obligations of a Participant under a qualified domestic relations order (as described in Section 414(p) of the Code) or obligations to the Trust pursuant to Section 7.09.

     14.02. Appointment of Person to Receive Payment. Upon the appointment by a court having jurisdiction of a legal representative for a Participant or Beneficiary, following a judicial determination that such Participant or Beneficiary is of unsound mind, any payment or distribution hereunder shall thereafter be made to such legal representative. In the event any amount shall become payable hereunder to any person (or the Beneficiary or estate of such person), and if after written notice from the Trustee mailed to such person’s last known address as shown on the Committee’s records, such person or personal representative shall not have presented himself to the Trustee or notified the Trustee in writing of his address within one (1) year after the mailing of such notice, then the Committee may in its discretion appoint one or more of the spouse and blood relatives of such person to receive such amount, including any

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amount thereafter becoming due to such person (or estate), in the proportions determined by them. Any action of the Committee hereunder shall be binding and conclusive upon all persons.

     14.03. Construction. In any question of interpretation or other matter of doubt, the Trustee, the Committee, and the Company may rely upon the opinion of counsel for the Company or any other attorney at law designated by the Company with the approval of the Trustee. The provisions of this Agreement shall be construed, administered, and enforced according to the laws of the United States and, to the extent permitted by such laws, by the laws of the Commonwealth of Massachusetts. All contributions to the Trust shall be deemed to be made in the Commonwealth of Massachusetts.

     14.04. Impossibility of Performance. In case it becomes impossible for the Company, the Committee, or the Trustee to perform any act under this Plan and Trust, that act shall be performed which in the judgment of the Committee will most nearly carry out the intent and purpose of this Plan and Trust. All parties to this Agreement or in any way interested in this Plan and Trust shall be bound by any acts performed under such condition.

     14.05. Definition of Words. Feminine or neuter pronouns shall be substituted for those of the masculine form, and the plural shall be substituted for the singular, in any place or places herein where the context may require such substitution or substitutions.

     14.06. Titles. The titles of articles and sections are included only for convenience and shall not be construed as a part of this Agreement or in any respect affecting or modifying its provisions.

     14.07. Merger or Consolidation. In the event that this Plan is merged with or consolidated with any other plan, or the assets or liabilities accrued under this Plan are transferred to any other plan, each Participant’s benefit under such other plan shall be at least as

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great immediately after such merger, consolidation, or transfer (if such plan were then to terminate) as the benefit to which such Participant would have been entitled under this Plan immediately before such merger, consolidation, or transfer (if the Plan were then to terminate).

     14.08. Claims Procedure.

          (a) If a Participant, Beneficiary, alternate payee, or their authorized representative (hereinafter the “Claimant”) asserts a right to a benefit under the Plan which has not been received, the Claimant must file a claim for such benefit with the Committee on forms provided by the Committee.

     Upon receipt of a claim, the Committee shall advise the Claimant that a reply will be forthcoming within 90 days and shall in fact deliver such reply in writing within such period. If special circumstances apply, the 90-day period may be extended by an additional 90 days; provided, written notice of the extension is provided to the Claimant during the initial 90-day period and such notice indicates the special circumstances requiring an extension of time and the date by which the Committee expects to render its decision on the claim.

     If the Committee wholly or partially denies the claim, the Committee shall provide written notice to the Claimant within the time limitations of the immediately preceding paragraph. Such notice shall set forth:

          (i) the specific reasons for the denial of the claim;

          (ii) specific reference to pertinent provisions of the Plan on which the denial is based;

          (iii) a description of any additional material or information necessary to perfect the claim and an explanation of why such material or information is necessary;

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          (iv) a description of the Plan’s claims review procedures, and the time limitations applicable to such procedures; and

          (v) appropriate information as to the steps to be taken if the Claimant wishes to submit the claim for review, including a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA if the claim denial is appealed to the Committee and the Committee fully or partially denies the claim.

          (b) A Claimant whose application for benefits is denied may request a full and fair review of the decision denying the claim by filing, in accordance with such procedures as the Committee may establish, a written appeal which sets forth the documents, records and other information relating to the claim within 60 days after receipt by the Claimant of the notice of the denial from the Committee. In connection with such appeal and upon request by the Claimant, a Claimant may review (or receive free copies of) all documents, records or other information relevant to the Claimant’s claim for benefit, all in accordance with such procedures as the Committee may establish. If a Claimant fails to file an appeal within such 60-day period, he shall have no further right to appeal.

          (c) A decision on the appeal by the Committee shall include a review by the Committee that takes into account all comments, documents, records and other information submitted by the Claimant relating to the claim, without regard to whether such information was submitted or considered in the initial claim determination. The Committee shall render its decision on the appeal not later than 60 days after the receipt by the Committee of the appeal. If special circumstances apply, the 60-day period may be extended by an additional 60 days; provided, written notice of the extension is provided to the Claimant during the initial 60-day period and such notice indicates the special circumstances requiring an extension of time and the

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date by which the Committee expects to render its decision on the claim on appeal. In the event that the Committee extends the determination period on appeal due to a Claimant’s failure to submit information necessary to decide a claim, the period for making the benefit determination on appeal shall not take into account the period beginning on the date on which notification of extension is sent to the Claimant and ending on the date on which the Claimant responds to the request for additional information.

     The Committee has discretionary authority to determine a Claimant’s eligibility for benefits and to interpret the terms of the Plan. Benefits under the Plan will be paid only if the Committee decides in its discretion that the Claimant is entitled to such benefits. The decision of the Committee shall be final and non-reviewable, unless found to be arbitrary and capricious by a court of competent review. Such decision will be binding upon the Company and the Claimant.

     If the Committee wholly or partly denies the claim on appeal, the Committee shall provide written notice to the Claimant within the time limitations described above. Such notice shall set forth:

          (i) the specific reasons for the denial of the claim;

          (ii) specific reference to pertinent provisions of the Plan on which the denial is based;

          (iii) a statement of the Claimant’s right to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the Claimant’s claim for benefits; and

          (iv) a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA.

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          (d) In no event may a claim for benefits be filed by a Claimant more than 120 days after the applicable “Notice Date,” as defined in (i) through (iv) below.

          (i) In any case where benefits are paid to the Claimant as a lump sum, the Notice Date shall be the date of payment of the lump sum.

          (ii) In any case where benefits are paid to the Claimant in the form of an annuity or in installments, the Notice Date shall be the date of the first payment.

          (iii) In any case where the Committee (prior to the filing of a claim for benefits under this Section 14.08) determines that an individual is not entitled to benefits from the Plan and the Committee provides written notice to such individual of its determination, the Notice Date shall be the date of the individual’s receipt of such notice.

          (iv) In any case where the Committee provides an individual, in connection with a distributable event under the Plan, a written statement of his or her vested account balance as of a specific date, the Notice Date shall be the latest date of the individual’s receipt of such notice.

          (e) In no event may any legal proceeding regarding entitlement to benefits or any aspect of benefits under the Plan be commenced later than the earliest of (i) two (2) years after the applicable Notice Date; or (ii) one (1) year after the date a claimant receives a decision from the Committee regarding his appeal; or (iii) the latest date otherwise prescribed by applicable law. In addition, no action at law or in equity shall be brought to recover under the Plan prior to the expiration of 60 days after receipt by the Claimant of the written decision regarding the Claimant’s request for review under the claims procedure.

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     14.09. Special Disability Provisions.

          (a) Notwithstanding anything herein, if a Claimant is denied a benefit because he or she is determined not to be disabled and he or she makes a claim pursuant to such denial, the provisions of this Section 14.09 shall apply. Upon receipt of a claim, the reply period shall be forty-five (45) days. If, prior to the end of such 45-day period, the claims reviewer determines that, due to matters beyond the control of the Plan, a decision cannot be rendered, the period for making the determination may be extended for up to thirty (30) days, and the claims reviewer shall notify the Claimant, prior to the expiration of such 45-day period, of the circumstances requiring an extension and the date by which the Plan expects to render a decision. If, prior to the end of the first 30-day extension period, the claims reviewer determines that, due to matters beyond the control of the Plan, a decision cannot be rendered within that extension period, the period for making the determination may be extended for up to an additional thirty (30) days, and the claims reviewer shall notify the Claimant, prior to the expiration of the first 30-day extension period, of the circumstances requiring the extension and the date by which the Plan expects to render a decision. In the case of any extension described in this paragraph, the notice of extension shall specifically explain the standards on which entitlement to a benefit is based, the unresolved issues that prevent a decision on the claim and the additional information needed to resolve those issues, and the Claimant shall be afforded forty-five (45) days within which to provide the specified information. If information is requested, the period for making the benefit determination shall be tolled from the date on which notification of an extension is sent to the Claimant until the date on which the Claimant responds to the request for information.

          (b) Within one hundred eighty (180) days after receiving the written notice of an adverse disposition of the claim, the Claimant may request in writing, and shall be entitled to,

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a review of the benefit determination. In deciding an appeal of any adverse benefit determination that is based in whole or in part on a medical judgment, the Plan shall consult with a health care professional who has appropriate training and experience in the field of medicine involved in the medical judgment. Such health care professional shall be an individual who is neither an individual who was consulted in connection with the adverse benefit determination that is the subject of the appeal nor the subordinate of any such individual. The medical or vocational experts whose advice was obtained on behalf of the Plan in connection with the Claimant’s adverse benefit determination will be identified to the Claimant. If the Claimant does not request a review within one hundred eighty (180) days after receiving written notice of the original’s disposition of the claim, the Claimant shall be deemed to have accepted the original written disposition.

          (c) A decision on review shall be rendered in writing by the Plan within a reasonable period of time, but ordinarily not later than forty-five (45) days after receipt of the Claimant’s request for review by the Plan, unless the Plan determines that special circumstances require an extension of time for processing the claim. If the Plan determines that an extension of time for processing is required, written notice of the extension shall be furnished to the Claimant prior to the termination of the initial forty-five (45) day period. In no event shall such extension exceed a period of forty-five (45) days from the end of the initial period. The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the Plan expects to render the determination on review. In the event the extension is due to a Claimant’s failure to submit information necessary to decide the claim, the Claimant shall be afforded forty-five (45) days within which to provide the specified information, and the period for making the benefit determination on review shall be tolled from the date on which

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notification of the extension is sent to the Claimant until the date on which the Claimant responds to the request for additional information.

          (d) In the case of an adverse benefit determination on review, in addition to the information described above, the notice shall state: “You and your Plan may have other voluntary alternative dispute resolution options, such as mediation. One way to find out what may be available is to contact your local U.S. Department of Labor Office and your State insurance regulatory agency.”

     14.10. Special Provisions for Certain Leased Employees. A “leased employee” shall receive credit for Hours of Service for the entire period during which he is a leased employee of the Company as if he were an Employee of the Company; provided, however, a leased employee shall not be an Employee eligible to participate in the Plan as long as he remains a leased employee. For purpose of this Section 14.10, the term leased employee means any person (a) who is not an Employee of the Company or an Affiliated Company and (b) who pursuant to an agreement between the Company or an Affiliated Company and any other person (a “leasing organization”) has performed services for the Company or an Affiliated Company on a substantially full-time basis for a period of at least one (1) year and such services are performed under the primary direction or control by the Company. Notwithstanding the foregoing, if leased employees constitute less than twenty percent (20%) of the Company’s or Affiliated Company’s non-highly compensated workforce within the meaning of Section 414(n)(5) of the Code, a person who is covered by a money purchase pension plan maintained by the leasing organization which provides a non- integrated employer contribution rate of at least ten percent (10%) of compensation, immediate participation, and full vesting shall not be considered a leased employee. In the case of a leased employee or an Employee, Years of Vesting Service shall be

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determined by taking into account any period for which the individual would have been a leased employee but for the fact that he or she had not performed services for the Company or an Affiliated Company on a substantially full-time basis for a period of at least one year. A transfer from the status of an employee of the Company to that of a leased employee shall not be considered a termination of employment under the Plan. An individual who has such a transfer shall not have a termination of employment until he or she ceases to be an employee of the Company and all Affiliated Companies and is no longer a leased employee.

     14.11. Execution of Plan. This Plan may be executed in any number of counterparts and each fully executed counterpart shall be deemed an original.

     14.12. USERRA. Notwithstanding any provision of this Plan to the contrary, contributions, benefits, and service credit with respect to qualified military service shall be provided in accordance with Section 414(u) of the Code.

     14.13. Death During Qualified Military Service. Effective January 1, 2007, if a Participant dies while performing qualified military service (as defined in Code Section 414(u)), the Participant’s spouse or beneficiary is entitled to any benefits (other than benefit accruals relating to the period of qualified military service), and the rights and features accompanying those benefits, that would have been provided under the Plan had the Participant been reemployed by the Company or an Affiliated Company and separated from service on account of death.

     14.14. Venue for Litigation. Any cause of action brought by a Claimant, Eligible Employee, Participant, former Eligible Employee, former Participant or any beneficiary of such an individual involving benefits under the Plan shall be filed and conducted exclusively in the federal courts in the District of Kansas.

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     14.15. Acquisition Of Assets. If the Plan Sponsor acquires the assets (through purchase, merger or otherwise) of any other entity and hires persons who had been employed by such entity, the division or other subgroup in which such persons are employed shall be excluded from the groups included in the definition of “Eligible Employee” unless the Plan Sponsor communicates to such division or subgroup that such division or subgroup is accruing benefits under the Plan.

     14.16. Contribution On Behalf Of Affiliated Company. If an Affiliated Company contributes to the Plan and the contribution is accepted by the Plan with the consent of the Plan Sponsor, the Affiliated Company will be deemed to have adopted the Plan with the consent of the Plan Sponsor with respect to the category of employees on behalf of whom the contribution was made.

     14.17. Separability Of Provisions. If any provision of this Plan shall be for any reason invalid or unenforceable, the remaining provisions shall nevertheless be carried into effect.

     14.18. Service Of Process. The Company or the Committee shall constitute the Plan’s agent for service of process.

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ARTICLE XV — MINIMUM DISTRIBUTION REQUIREMENTS

     15.01. General Rules.

          (a) Effective Date. The provisions of this Article XV will apply for purposes of determining required minimum distributions for calendar years beginning with the 2002 calendar year.

          (b) Coordination with Minimum Distribution Requirements Previously in Effect. Required minimum distributions for 2002 under this Article XV will be determined as follows. If the total amount of 2002 required minimum distributions under the Plan made to the distributee prior to the adoption date of this Article XV equals or exceeds the required minimum distributions determined under this Article XV, then no additional distributions will be required to be made for 2002 on or after such date to the distributee. If the total amount of 2002 required minimum distributions under the Plan made to the distributee prior to the adoption date of this Article XV is less than the amount determined under this Article XV, then required minimum distributions for 2002 on and after such date will be determined so that the total amount of required minimum distributions for 2002 made to the distributee will be the amount determined under this Article XV.

          (c) Precedence. The requirements of this Article XV will take precedence over any inconsistent provisions of the Plan.

          (d) Requirements of Treasury Regulations Incorporated. All distributions required under this Article XV will be determined and made in accordance with the Treasury regulations under Section 401(a)(9) of the Code.

          (e) TEFRA Section 242(b)(2) Elections. Notwithstanding the other provisions of this Article XV, distributions may be made under a designation made before January 1, 1984, in accordance with Section 242(b)(2) of the Tax Equity and Fiscal

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Responsibility Act (“TEFRA”) and the provisions of the Plan that relate to Section 242(b)(2) of TEFRA.

     15.02. Time and Manner of Distribution.

     (a) Required Beginning Date. The Participant’s entire interest will be distributed, or begin to be distributed, to the Participant no later than the Participant’s Required Beginning Date.

     (b) Death of Participant Before Distributions Begin. If the Participant dies before distributions begin, the Participant’s entire interest will be distributed, or begin to be distributed, no later than as follows:

          (i) If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary, then distributions to the surviving spouse will begin by December 31 of the calendar year immediately following the calendar year in which the Participant died, or by December 31 of the calendar year in which the Participant would have attained age 70¹/2, if later.

          (ii) If the Participant’s surviving spouse is not the Participant’s sole Designated Beneficiary, then distributions to the Designated Beneficiary will begin by December 31 of the calendar year immediately following the calendar year in which the Participant died.

          (iii) If there is no Designated Beneficiary as of September 30 of the year following the year of the Participant’s death, the Participant’s entire interest will be distributed by December 31 of the calendar year containing the fifth anniversary of the Participant’s death.

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          (iv) If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary and the surviving spouse dies after the Participant but before distributions to the surviving spouse begin, this Section 15.02(b), other than Section 15.02(b)(i), will apply as if the surviving spouse were the Participant.

     For purposes of this Section 15.02(b) and Section 15.04, unless Section 15.02(b)(iv) applies, distributions are considered to begin on the Participant’s Required Beginning Date. If Section 15.02(b)(iv) applies, distributions are considered to begin on the date distributions are required to begin to the surviving spouse under Section 15.02(b)(i). If distributions under an annuity purchased from an insurance company irrevocably commence to the Participant before the Participant’s Required Beginning Date (or to the Participant’s surviving spouse before the date distributions are required to begin to the surviving spouse under Section 15.02(b)(i)), the date distributions are considered to begin is the date distributions actually commence.

          (c) Forms of Distribution. Unless the Participant’s interest is distributed in the form of an annuity purchased from an insurance company or in a single sum on or before the Required Beginning Date, as of the first Distribution Calendar Year distributions will be made in accordance with Sections 15.03 and 15.04 of this Article XV. If the Participant’s interest is distributed in the form of an annuity purchased from an insurance company, distributions thereunder will be made in accordance with the requirements of Section 401(a)(9) of the Code and the Treasury regulations.

     15.03. Required Minimum Distributions During Participant’s Lifetime.

          (a) Amount of Required Minimum Distribution for each Distribution Calendar Year. During the Participant’s lifetime, the minimum amount that will be distributed for each Distribution Calendar Year is the lesser of:

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          (i) the quotient obtained by dividing the Participant’s Account balance by the distribution period in the Uniform Lifetime Table set forth in Section 1.401(a)(9)-9 of the Treasury regulations, using the Participant’s age as of the Participant’s birthday in the Distribution Calendar Year; or

          (ii) if the Participant’s sole Designated Beneficiary for the Distribution Calendar Year is the Participant’s spouse, the quotient obtained by dividing the Participant’s Account balance by the number in the Joint and Last Survivor Table set forth in Section 1.401(a)(9)-9 of the Treasury regulations, using the Participant’s and spouse’s attained ages as of the Participant’s and spouse’s birthdays in the Distribution Calendar Year.

          (b) Lifetime Required Minimum Distributions Continue Through Year of Participant’s Death. Required minimum distributions will be determined under this Section 15.03 beginning with the first Distribution Calendar Year and up to and including the Distribution Calendar Year that includes the Participant’s date of death.

     15.04. Required Minimum Distributions After Participant’s Death.

          (a) Death On or After Date Distributions Begin.

          (i) Participant Survived by Designated Beneficiary. If the Participant dies on or after the date distributions begin and there is a Designated Beneficiary, the minimum amount that will be distributed for each Distribution Calendar Year after the year of the Participant’s death is the quotient obtained by dividing the Participant’s Account balance by the longer of the remaining Life Expectancy of the Participant or the remaining Life Expectancy of the Participant’s Designated Beneficiary, determined as follows:

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          (A) The Participant’s remaining Life Expectancy is calculated using the age of the Participant in the year of death, reduced by one for each subsequent year.

          (B) If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary, the remaining Life Expectancy of the surviving spouse is calculated for each Distribution Calendar Year after the year of the Participant’s death using the surviving spouse’s age as of the spouse’s birthday in that year. For Distribution Calendar Years after the year of the surviving spouse’s death, the remaining Life Expectancy of the surviving spouse is calculated using the age of the surviving spouse as of the spouse’s birthday in the calendar year of the spouse’s death, reduced by one for each subsequent calendar year.

          (C) If the Participant’s surviving spouse is not the Participant’s sole Designated Beneficiary, the Designated Beneficiary’s remaining Life Expectancy is calculated using the age of the beneficiary in the year following the year of the Participant’s death, reduced by one for each subsequent year.

          (ii) No Designated Beneficiary. If the Participant dies on or after the date distributions begin and there is no Designated Beneficiary as of September 30 of the year after the year of the Participant’s death, the minimum amount that will be distributed for each Distribution Calendar Year after the year of the Participant’s death is the quotient obtained by dividing the Participant’s Account balance by the Participant’s remaining Life Expectancy calculated using the age of the Participant in the year of death, reduced by one for each subsequent year.

          (b) Death Before Date Distributions Begin.

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          (i) Participant Survived by Designated Beneficiary. If the Participant dies before the date distributions begin and there is a Designated Beneficiary, the minimum amount that will be distributed for each Distribution Calendar Year after the year of the Participant’s death is the quotient obtained by dividing the Participant’s Account balance by the remaining Life Expectancy of the Participant’s Designated Beneficiary, determined as provided in Section 15.04(a).

          (ii) No Designated Beneficiary. If the Participant dies before the date distributions begin and there is no Designated Beneficiary as of September 30 of the year following the year of the Participant’s death, distribution of the Participant’s entire interest will be completed by December 31 of the calendar year containing the fifth anniversary of the Participant’s death.

          (iii) Death of Surviving Spouse Before Distributions to Surviving Spouse Are Required to Begin. If the Participant dies before the date distributions begin, the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary, and the surviving spouse dies before distributions are required to begin to the surviving spouse under Section 15.02(b)(i), this Section 15.04(b) will apply as if the surviving spouse were the Participant.

     15.05. Definitions.

          (a) Designated Beneficiary. The individual who is designated as the “Beneficiary” under Section 7.04 of the Plan and is the Designated Beneficiary under Section 401(a)(9) of the Code and Section 1.401(a)(9)-4, of the Treasury regulations.

          (b) Distribution Calendar Year. A calendar year for which a minimum distribution is required. For distributions beginning before the Participant’s death, the first

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Distribution Calendar Year is the calendar year immediately preceding the calendar year which contains the Participant’s Required Beginning Date. For distributions beginning after the Participant’s death, the first Distribution Calendar Year is the calendar year in which distributions are required to begin under Section 15.02(b). The required minimum distribution for the Participant’s first Distribution Calendar Year will be made on or before the Participant’s Required Beginning Date. The required minimum distribution for other Distribution Calendar Years, including the required minimum distribution for the Distribution Calendar Year in which the Participant’s Required Beginning Date occurs, will be made on or before December 31 of that Distribution Calendar Year.

          (c) Life Expectancy. Life Expectancy as computed by use of the Single Life Table in Section 1.401(a)(9)-9 of the Treasury regulations.

          (d) Participant’s Account Balance. The Account balance as of the last valuation date in the calendar year immediately preceding the Distribution Calendar Year (valuation calendar year) increased by the amount of any contributions made and allocated or forfeitures allocated to the Account balance as of dates in the valuation calendar year after the valuation date and decreased by distributions made in the valuation calendar year after the valuation date. The Account balance for the valuation calendar year includes any amounts rolled over or transferred to the Plan either in the valuation calendar year or in the Distribution Calendar Year if distributed or transferred in the valuation calendar year.

          (e) Required Beginning Date. The date specified in Section 7.07(d)(ii) of the Plan.

     15.06. 2009 RMDs. Notwithstanding anything to the contrary in this Article XV, a Participant, a Participant’s surviving spouse or a Participant’s sole designated beneficiary who

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would have been required to receive required minimum distributions under this Article XV for 2009 but for the enactment of Code Section 401(a)(9)(H) (“2009 RMDs”), and who would have satisfied that requirement by receiving distributions that are (a) equal to the 2009 RMDs or (b) one or more payments in a series of substantially equal distributions (that include the 2009 RMDs) made at least annually and expected to last for the life (or life expectancy) of the Participant, the joint lives (or joint life expectancy) of the Participant and the Participant’s designated beneficiary, or for a period of at least 10 years, will not receive those distributions for 2009 unless the Participant or the Participant’s designated beneficiary chooses to receive such distributions. Participants and designated beneficiaries described in the preceding sentence will be given the opportunity to elect to receive the distributions described in the preceding sentence. In addition, notwithstanding Section 7.14, and solely for purposes of applying the direct rollover provisions of the Plan, 2009 RMDs will be treated as eligible rollover distributions.

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COLLECTIVE BRANDS PERFORMANCE + LIFESTYLE GROUP

EMPLOYEE SAVINGS & INVESTMENT PLAN

APPENDIX A

Limitation on Tax Deferred Contributions

     The amount of Tax Deferred Contributions made by the Company during the Plan Year commencing on January 1, _____ on behalf of a Participant who is a Highly Compensated Employee shall not exceed $_________.

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EXHIBIT A

COLLECTIVE BRANDS PERFORMANCE + LIFESTYLE GROUP

EMPLOYEE SAVINGS & INVESTMENT PLAN

Applicable to Certain Individuals
Who Were Participants in the
Saucony, Inc. 401(k) Plan (“Saucony Plan”)
as of September 16, 2005 and December 31, 2005

     The provisions of this Exhibit A shall apply to those individuals covered herein and shall be made part of the Collective Brands Performance + Lifestyle Group Employee Savings & Investment Plan (the “Plan”), as amended and restated effective January 1, 2001, and as subsequently amended, with respect to such individuals.

     1. All individuals who were eligible to participate in the Saucony Plan (“Former Saucony Employees”) on September 16, 2005 shall not be eligible to participate in this Plan until January 1, 2006 and then only to the extent provided herein.

     2. All Former Saucony Employees who are employed in one of the “Specified Groups” (as defined below) on December 31, 2005 shall be eligible to participate in this Plan effective January 1, 2006, subject to the terms and conditions of this Plan. For this purpose, the “Specified Groups” include the following:

A. All Lexington, Massachusetts Based Associates

B. All Field Sales Associates

C. All Distribution Associates

D. All Richmond Customer Service Employees

E. All Regional Retail Vice Presidents

F. All Retail District Managers

G. All Peabody, Massachusetts Based Employees (including Customer Service)

H. All Peabody, Massachusetts Based Distribution Employees

I. All Western Massachusetts Based Distribution Employees

J. All Sales Teams

K. All Union Employees

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     3. For eligibility and vesting purposes, Former Saucony Employees shall receive service under the Plan from their date of hire by Saucony, Inc.

     4. All Former Saucony Employees shall remain vested in the vested portion of their Accounts attributable to Matching Contributions and Employer Profit Sharing Contributions (if applicable).

     5. All Former Saucony Employees shall continue to vest in the unvested portion of their Accounts attributable to Matching Contributions and Employer Profit Sharing Contributions (if applicable) contributed to their Accounts on or prior to December 31, 2005 in accordance with the vesting schedule specified in the Saucony Plan (i.e., a three-year graded vesting schedule).

     6. All Former Saucony Employees (other than union employees covered by the Teamsters Local 25 collective bargaining agreement at the Peabody Warehouse (the “Peabody Union Employees”)) shall vest in the portion of their Accounts attributable to Matching Contributions contributed to their Company Account on or after January 1, 2006 in accordance with the vesting schedule specified in Section 7.05 of this Plan.

     7. All Peabody Union Employees shall vest in the portion of their Accounts attributable to Matching Contributions contributed to their Company Account on or after January 1, 2006 in accordance with the vesting schedule specified in the Saucony Plan (i.e., a three-year graded vesting schedule).

     8. Notwithstanding the foregoing, in the event that a Former Saucony Employee’s employment is terminated in connection with a reduction in force related to the merger of Saucony, Inc. and The Stride Rite Corporation, such a Former Saucony Employee shall become 100% vested in all of his Accounts.

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     9. If a withdrawal under the Plan by a Former Saucony Employee is made with respect to an account subject to a graded vesting schedule and such account was not 100% vested at the time of such withdrawal, then the Company shall separately record the portion of such account that was not vested at the time of the withdrawal, and the vested amount of such portion from time to time shall equal an amount (“X”) determined by the following formula:

     X = P(AB + (R X D)) — (R X D)

     For purposes of applying such formula: “P” is the vested percentage at the relevant time; “AB” is the account balance at the relevant time; “D” is the amount previously withdrawn by the Participant; and “R” is the ratio of the account balance at the relevant time to the account balance after the withdrawal.

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     IN WITNESS WHEREOF the Company, by its duly authorized officer, has caused these presents to be signed and its corporate seal affixed, this 21^st day of July, 2011.

THE STRIDE RITE CORPORATION
By:	/s/ Sally J. Burk
	Name:	Sally Burk
	Title:	Vice President

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EX-4.3

Exhibit 4.3

PAYLESS SHOESOURCE, INC.
PROFIT SHARING PLAN
FOR PUERTO RICO ASSOCIATES

As Amended Effective January 1, 2007, or as otherwise specified.

TABLE OF CONTENTS

	PAGE
SECTION 1		7
Definitions		7
1.01 Accounts		7
1.02 Administrative Delegate		7
1.03 After-Tax Contributions		7
1.04 Allocation Pay Amount		7
1.05 Associate		7
1.06 Authorized Leave of Absence		8
1.07 Before-Tax Contributions		8
1.08 Beneficiary		8
1.09 Board		8
1.10 US Code		8
1.11 Committee		8
1.12 Company or Payless		8
1.13 Company Accounts		8
1.14 Company Matching Contributions		9
1.15 Company Profit Sharing Contributions		9
1.16 Effective Date		9
1.17 Employer or Payless PR		9
1.18 ERISA		9
1.19 Fiduciary		9
1.20 Fiscal Year		9
1.21 Group		9
1.22 Hour of Service		9
1.23 Investment Fund		10
1.24 May Plan		10
1.25 Member		10
1.26 Member Accounts		10
1.27 Member After-Tax Accounts		10
1.28 Member Before-Tax Account		10
1.29 Member Contributions		10
1.30 Member Rollover Contribution Accounts		10
1.31 Military Service		10
1.32 Net Profit		11

i

	PAGE
1.33 Pay		11
1.34 Pooled Investment Account		11
1.35 Plan		11
1.36 Plan Year		11
1.37 PR Code		11
1.38 Prior Plan		11
1.39 Qualified Domestic Relations Order		12
1.40 Retirement		12
1.41 Rollover Contributions		12
1.42 Social Security Wage Base		12
1.43 Total and Permanent Disability or Disability		12
1.44 Transferred Accounts		12
1.45 Trust Agreement		12
1.46 Trust Fund		12
1.47 Trustee		12
1.48 Unit		12
1.49 Unit Value		12
1.50 Valuation Date		12
1.51 Year of Service		13
1.52 Vesting Service		13
SECTION 2		14
Membership		14
2.01 Conditions of Eligibility.		14
SECTION 3		16
Company Contributions		16
3.01 Amount of Company Profit Sharing Contribution		16
3.02 Amount of Company Matching Contribution		16
3.03 Allocation of Company Contributions		16
3.04 Profit Sharing Allocation Formula		17
3.05 Investment of the Company		17
3.06 Return of Company Contributions		17
SECTION 4		19
Member Contributions		19
4.01 Procedure for Making Contributions.		19
4.02 Limitations on Before-Tax Contributions.		21
4.03 Distributions of Excess Deferrals		24
4.04 Limitations on After-Tax Contributions		24

ii

	PAGE
4.05 Limitations on Company Matching Contributions		24
4.06 Aggregate Limitations		25
SECTION 5		25
Investment Provisions		25
5.01 Investment Funds.		25
5.02 Investment Direction.		25
SECTION 6		26
Accounts		26
6.01 Member Accounts		26
6.02 Company Accounts		26
6.03 Maintenance of Accounts		26
6.04 Valuation of Accounts		27
6.05 Member Statements		27
6.06 Shares of Payless ShoeSource, Inc. (“Payless Stock”) in the Payless Common Stock Fund		27
6.07 Vesting in Member and Company Accounts		28
SECTION 7		31
Expenses		31
7.01 Administrative Expenses		31
SECTION 8		31
Withdrawals During Employment		31
8.01 Withdrawals Prohibited Unless Specifically Authorized		31
8.02 Authorized Withdrawals.		31
SECTION 9		33
Benefits Upon Retirement, Death, Disability, or Termination of Employment		33
9.01 Benefits		33
9.02 Beneficiary		33
SECTION 10		34
Payment of Benefits		34
10.01 Time of Payment		34
10.02 Form of Payment		35
10.03 Indirect Payment of Benefits		35
10.04 Inability to Find Member		35
10.05 Required Minimum Distributions		35
10.06 Commencement of Benefit Distribution to Beneficiary		39
10.07 Commencement of Benefit Distribution to Alternate Payee		39
SECTION 11		40
Permitted Rollover of Plan Distributions		40
11.01 Rollover Amount to Other Plans		40
11.02 Rollover Amount from Other Plans		40
11.03 Definitions		41

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	PAGE
SECTION 12		42
Loans		42
12.01 Availability of Loans		42
12.02 Amounts of Loans		42
12.03 Terms of Loans		42
SECTION 13		43
Limit on Contributions to the Plan		43
13.01 Limit on Contributions		43
13.02 Adjustment for Excessive Annual Additions		44
SECTION 14		45
Administration of the Plan		45
14.01 Plan Administrator		45
14.02 Delegation of Authority		45
14.03 Committee and Subcommittees		46
14.04 Accounts and Reports		47
14.05 Non-Discrimination		47
SECTION 15		47
Management of the Trust Fund		47
15.01 Use of the Trust Fund		47
15.02 Trustees		47
15.03 Investments and Reinvestments		47
SECTION 16		48
Certain Rights and Obligations of Employers and Members		48
16.01 Disclaimer of Employer Liability		48
16.02 Employer-Associate Relationship		49
16.03 Binding Effect		49
16.04 Corporate Action		49
16.05 Claim and Appeal Procedure		49
SECTION 17		49
Non-Alienation of Benefits		49
17.01 Provisions With Respect to Assignment and Levy		49
17.02 Alternate Application		50
SECTION 18		50
Amendments		50
18.01 Company’s Rights		50
18.02 Procedure to Amend		51
18.03 Provision Against Diversion		51
SECTION 19		51
Termination		51
19.01 Right to Terminate		51
19.02 Withdrawal of an Employer		51

iv

	PAGE
19.03 Distribution in Event of Termination of Trust		51
19.04 Administration in Event of Continuance of Trust		51
19.05 Merger, Consolidation or Transfer		52
SECTION 20		52
Construction		52
20.01 Applicable Law		52
20.02 Gender and Number		52

v

PAYLESS SHOESOURCE, INC.
PROFIT SHARING PLAN FOR PUERTO RICO ASSOCIATES

INTRODUCTION

     Effective April 1, 1996, Payless ShoeSource, Inc. (“Payless”) withdrew from and ceased to be a participating Employer in The May Department Stores Company Profit Sharing Plan (the “May Plan”) and established the Payless ShoeSource, Inc. Profit Sharing Plan (the “Payless Plan”). The Payless Plan, as adopted, covered eligible Associates employed in Puerto Rico by Payless ShoeSource of Puerto Rico, Inc. (“Payless PR”). Effective January 1, 1997, a portion of the Payless Plan covering Associates employed by Payless PR was spun off and established a new plan, Payless ShoeSource, Inc. Profit Sharing Plan for Puerto Rico Associates (the “Plan”), which was adopted by Payless PR as an adopting Employer.

     Effective March 20, 2000, or as otherwise specified, Payless amended and restated the Plan primarily to include provisions for loans, the acceptance of rollover contributions from other qualified plans, a change to daily valuation, other miscellaneous changes and to comply with the tax laws of Puerto Rico. Such amendment and restatement applies only to Associates or former Associates who were employed by an Employer on or after the effective date(s) of the respective amended provisions, and the rights and benefits of persons thereunder are to be determined solely in accordance with the provisions of the Plan in effect on the date an Associate’s employment was or is terminated. Notwithstanding the preceding sentence, the change in valuation date became effective for all Associates and former Associates, without regard to employment after the effective date.

     Effective May 1, 2002, the Plan was amended and restated primarily to permit Full-Time Associates to participate in the Plan upon the completion of 90 days of employment service with a participating Employer or other member of the Group. The Plan was also amended and restated effective January 1, 2003 to reflect new terms governing required minimum distributions. The Plan was further amended as specified to provide for a guaranteed minimum Company Matching Contribution. Additional amendments were made effective January 1, 2006 to permit Full-Time Associates to make elective contributions to the Plan after completing 60 days of employment and to be eligible to receive the Company Matching Contribution after completing 180 days of employment. Additionally, the Plan was amended to provide further clarification on the definition of a “hardship”. The Plan was further amended effective January 1, 2007 to provide for part-Time Associates to be eligible to participate in the Plan upon turning age 21 and completing a full year of employment and to remove the re-employment provision specified under Section 2.02.

     The terms and provisions of this new Plan are as follows:

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SECTION 1

Definitions

     1.01 Accounts means the Company Accounts and Member Accounts established under Section 6.

     1.02 Administrative Delegate means one or more persons or institutions to which the Committee has delegated certain administrative functions pursuant to a written agreement.

     1.03 After-Tax Contributions means Member Contributions which are not Before-Tax Contributions and which are made by the Member in accordance with Section 4.01(a).

     1.04 Allocation Pay Amount means with respect to each eligible Member, (a)  one (1)  times the amount of Pay as defined in Section 1.33 up to the Social Security Wage Base (“SSWB”) for the Plan Year, plus (b)  two (2)  times the amount of such Pay in excess of the SSWB for the Plan Year. Notwithstanding any provision of this Section 1.04 or of Section 3.03 to the contrary, in no event shall the percentage of Members’ Pay to be allocated for any year below the SSWB be less than fifty percent (50%) of the percentage of Pay allocated with respect to Members’ Pay in excess of the SSWB, nor may the latter percentage of Pay (above the SSWB) exceed the former percentage of Pay (below the SSWB) by more than 5.7% (or such other percentage as may be the maximum permitted differential under US Code Section 401(1) from time to time).

     In determining each eligible Member’s Allocation Pay Amount, only Pay received during the part of the Plan Year the Member is eligible for the Company Contribution feature of the Plan, pursuant to Section 2, shall be considered, and the SSWB to be applied for such Member shall be proportionally prorated if such eligibility is for less than a full Plan Year.

     Notwithstanding the foregoing, with respect to any Plan Year for which applying the definition of Allocation Pay Amount set forth above would cause the allocation made pursuant to Section 3.03 to violate the permitted disparity limitations of US Treas. Reg. Section 1.401(l)-2, Allocation Pay Amount shall be adjusted to permit Section 3.03 to operate in compliance with the limitations of US Treas. Reg. Section 1.401(l)-2.

     1.05 Associate means any person employed by Payless PR who receives Pay from Payless PR. The term Associate also may include, based upon the express written determination of the Company or the Committee, a person who receives Pay from sources within Puerto Rico and who is employed, at the request of the Company or the Employer, by a member of the Group (defined in Section 1.21) to the extent such employee otherwise qualifies for membership under Section 2, in which case such Group member shall be deemed to be an “Employer” hereunder, as to such person or persons only. The term

7

“Associate” shall not include (i)  any person covered under a collective bargaining agreement unless and until the Employer and the collective bargaining representatives so agree, (ii)  any non-resident alien who received no earned income from the Employer from sources within Puerto Rico, and (iii)  any “leased employee” within the meaning of US Code Section 414(n)(2). The term “Associate” may include, where appropriate, Associates of Payless or other related Employers who are transferred to the Employer or as otherwise may be necessary or appropriate in construing the Plan under applicable law. In the event that an individual who was not classified as an employee or a common-law employee is legally reclassified as an employee or a common-law employee of the Employer, such employee shall only be considered to be an employee at the time of such reclassification, or, if later, at the time that such individual is initially treated as an employee or common-law employee on the payroll records of the Company.

     1.06 Authorized Leave of Absence means any leave of absence authorized by the Employer under rules established by the Employer.

     1.07 Before-Tax Contributions means contributions which the Member elects (in accordance with Section 4.01(b)) to have the Employer make directly to the Plan on behalf of the Member, which election shall constitute an election under PR Code Section 1165(e)(2)(A). The “Member’s Before-Tax Contributions” shall refer to Before-Tax Contributions made to the Plan by the Employer on behalf of the Member.

     1.08 Beneficiary means the person or persons entitled under Section 9.02 to receive any payments payable under this Plan on account of a Member’s death.

     1.09 Board means the Board of Directors of the Company.

     1.10 US Code means the U.S. Internal Revenue Code of 1986, as amended from time to time.

     1.11 Committee means the Profit Sharing Committee comprised of three or more members as determined and appointed from time to time by the Board. Unless determined otherwise by the Board, the Committee shall constitute the Profit Sharing Committee of the Payless ShoeSource, Inc. 401(k) Profit Sharing Plan from time to time.

     1.12 Company or Payless means Payless ShoeSource, Inc., a Delaware corporation, and any other organization which may be a successor to it.

     1.13 Company Accounts means accounts reflecting the portion of each Member’s interest in the Investment Funds which are attributable to Company Matching Contributions (“Company Matching Accounts”) and to Company Profit Sharing Contributions (“Company Profit Sharing Accounts”) and to any contributions made by an Employer under Prior Plans, as well as to any income and/or earnings attributable to such Company Contributions and Prior Plan contributions.

8

     1.14 Company Matching Contributions means contributions made by the Company, based on a Member’s Before-Tax and/or After-Tax Contributions, pursuant to Section 3.02.

     1.15 Company Profit Sharing Contributions means discretionary contributions made by the Company, based on Net Profits, pursuant to Section 3.01.

     1.16 Effective Date means March 20, 2000 or as otherwise specified herein.

     1.17 Employer or Payless PR means Payless ShoeSource of Puerto Rico, Inc. and any other entity affiliated with the Company which elects, with the consent of the Company, to participate herein.

     1.18 ERISA means the Employee Retirement Income Security Act of 1974, as amended from time to time, to the extent applicable to the Plan.

     1.19 Fiduciary means the Employer, the Trustee, each of the members of the Committee described in Section 14, and any investment manager designated pursuant to Section 15.

     1.20 Fiscal Year means the Company’s Fiscal Year.

     1.21 Group means the Company, the Employer, and any other company which is related to the Company or Employer as a member of a controlled group of corporations in accordance with ERISA Section 210(c), or as a trade or business under common control in accordance with ERISA Section 210(d). For the purposes of the Plan, for determining whether or not a person is an employee of the Group and the period of employment of such person, each such other company shall be included in the “Group” only for such period or periods during which such other company is a member with the Company or Employer of a controlled group or under common control. In determining Hours of Service, Years of Service and Vesting Service for all purposes hereunder, employment with any member of the Group shall be included. Members of an affiliated service group under US Code Section 414(m) will also be part of the Group.

     1.22 Hour of Service means any hour for which an Associate (including a leased employee) is directly or indirectly compensated, or entitled to compensation, by the Company, the Employer or any other member of the Group, whether or not such Group member has adopted the Plan, for any of the following:

          (a)  the performance of duties during the applicable computation period;

          (b) a period during which no duties are performed (irrespective of whether the employment relationship has terminated) due to vacation, holiday, illness, incapacity (including disability), layoff, jury duty, Military Service, or Authorized Leave of Absence;

9

          (c)  a period for which back pay is awarded or agreed to, provided that no Hour of Service has been credited under subsection (a)  or (b)  with respect to the same period.

     Hours of Service and applicable computation periods shall be determined in accordance with the requirements of 29 C.F.R. Section 2530.200b.

     1.23 Investment Fund means any fund for investment of contributions as described in Section 5.01.

     1.24 May Plan means The May Department Stores Company Profit Sharing Plan.

     1.25 Member means any person included in the membership of this Plan as provided in Section 2.

     1.26 Member Accounts means the Member Before-Tax Accounts, the Member After-Tax Accounts and the Member Rollover Contribution Accounts. To the extent an Associate makes a Rollover Contribution pursuant to Section 11.02 and the Associate is otherwise eligible but has not yet completed the participation requirements of Section 2.01, such contribution shall also be a Member Account.

     1.27 Member After-Tax Accounts means the Member Accounts with respect to a Member’s After-Tax Contributions.

     1.28 Member Before-Tax Accounts means the Member Accounts with respect to a Member’s Before-Tax Contributions.

     1.29 Member Contributions means the Member’s Before-Tax Contributions and After-Tax Contributions.

     1.30 Member Rollover Contribution Accounts means the Member Accounts with respect to an Associate’s or Member’s Rollover Contributions.

     1.31 Military Service means effective December 13, 1996, any period of obligatory military service with the Armed Forces of the United States of America, or voluntary service in lieu of such obligatory service, provided that the Associate returns to active employment with the Employer within the period during which the Employer would be required to re-employ the Associate under Federal law. Notwithstanding any provision of this Plan to the contrary, contributions, benefits and service credit with respect to qualified Military Service will be provided in accordance with the Uniform Services Employment and Reemployment Rights Act and US Code Section 414(u).

10

     1.32 Net Profits means the consolidated net profits of the Company for any given Fiscal Year, determined by generally accepted accounting principles except that (i)  no deduction or provision shall be made for any federal, state or other taxes measured by net income nor for any contributions to the Trust or to any other pension or profit sharing plan, and (ii)  there shall be excluded any proceeds from life insurance of which the Company or the Employer is beneficiary (whether paid in a single sum or otherwise) and any gains or losses on the sale of capital assets. Such term shall also mean any accumulated and undistributed Net Profits (as defined in the preceding sentence) earned in prior Fiscal Years to the extent that such accumulated and undistributed Net Profits constitute surplus of the Company and its subsidiaries available for contributions hereunder.

     1.33 Pay means the aggregate of (i)  all regular pay, commissions, overtime pay, cash incentives, and prizes and cash awards, plus (ii)  amounts which the Associate elects to have the Employer contribute directly to the Plan on the Associate’s behalf in accordance with Section 4.01(b). Pay shall include any amounts not otherwise includable in the Member’s taxable income pursuant to US Code Section 125. Pay shall not include amounts for a pension, a retirement allowance, a retainer or a fee under contract, deferred compensation (including amounts deferred under the Deferred Compensation Plan of Payless ShoeSource, Inc.), severance pay, distributions from this Plan or items of extraordinary income including but not limited to amounts resulting from the exercise of stock options, spinoff cash, spinoff stock and restricted stock awards. Pay in excess of $170,000 shall be disregarded, although such amount shall be adjusted at the same time and in such manner as permitted under US Code Section 415(d).

     1.34 Pooled Investment Account means an account established pursuant to an administrative services agreement between the Company and the Trustee.

     1.35 Plan means this Payless ShoeSource, Inc. Profit Sharing Plan for Puerto Rico Associates, as amended from time to time.

     1.36 Plan Year means a calendar year ending each December 31.

     1.37 PR Code means the Puerto Rico Internal Revenue Code of 1994, as amended from time to time.

     1.38 Prior Plan means The May Department Stores Company Profit Sharing Plan, the Volume Shoe Corporation Profit Sharing Plan, the Payless ShoeSource, Inc. Profit Sharing Plan and such other qualified plan as may be so designated by the Committee.

     1.39 Qualified Domestic Relations Order means a “qualified domestic relations order” as that term is defined in ERISA Section 206(d)(3), provided that such order was entered on or after January 1, 1985.

11

     1.40 Retirement means a Member’s termination of employment on or after age 55 and after completing at least five (5)  Years of Service or attaining the fifth anniversary of participation, as of which date the Member’s benefit shall be nonforfeitable.

     1.41 Rollover Contributions means contributions which the Associate or Member, as applicable, elects to make in accordance with Section 11.02.

     1.42 Social Security Wage Base means, with respect to each Plan Year, the maximum amount of wages which are subject to tax in such year under the Federal Old Age, Survivors and Disability Insurance System.

     1.43 Total and Permanent Disability or Disability means the qualification for disability benefits under Title 11 of the Federal Social Security Act.

     1.44 Transferred Accounts means Member and Company Accounts transferred from a Prior Plan.

     1.45 Trust Agreement means the agreement or agreements provided for in Section 14, as amended from time to time.

     1.46 Trust Fund means all the assets of the Investment Funds, including assets transferred from a Prior Plan, which are held in one or more trusts by the Trustee or Trustees for the purposes of this Plan.

     1.47 Trustee means the corporation(s), person or persons which may at any time be acting as Trustee or Trustees under the Trust Agreement.

     1.48 Unit means one of the units representing an interest in an Investment Fund as provided in Section 6.03.

     1.49 Unit Value means the value of each Unit in an Investment Fund as of the Valuation Date as determined pursuant to Section 6.04.

     1.50 Valuation Date means any day that the New York Stock Exchange is open for business or any other date chosen by the Committee. Prior to March 31, 2000, Valuation Date means the last business day of each calendar month and any other date chosen to perform a valuation.

     1.51 Year of Service for purposes of determining eligibility under Section 2 means a year of employment during which the Associate has been paid for not less than 1,000 Hours of Service for an Employer or any other member of the Group. An Associate shall be credited with a year of employment on each anniversary date of his commencement of employment with an Employer during which he earns not less than 1,000 Hours of Service for an Employer or any other member of the Group. Periods of temporary illness, temporary layoff, Military Service, and Authorized Leaves of Absence

12

shall not be deemed as breaking continuity of employment and shall be counted in determining Years of Service. The term “Year of Service” shall also include an employment year during which, except to the extent otherwise provided in the US Treasury Regulations, a “leased employee” within the meaning of US Code Section 414(n) has been paid for not less than 1,000 Hours of Service for the Employer even though during such period the leased employee was not an Associate as defined in Section 1.05. The term “Year of Service” shall include any period required to be included by the Family and Medical Leave Act of 1993.

The extent to which service with another organization, part or all of whose business operations are acquired by the Company (or by an Employer), shall be credited as “Years of Service” hereunder or as “Vesting Service” under Section 1.52 shall be determined by the Company or by the Committee on a case-by-case basis.

     1.52 Vesting Service for purposes of determining a Member’s vested interest under Section 6.07 is based on “elapsed time” and is to be determined in accordance with the following definitions:

          (a)  “Employment Commencement Date” means the date upon which an Associate first performs an Hour of Service.

          (b)  “Hour of Service” means an hour for which an Associate is paid or entitled to payment for the performance of duties for the Employer or any other member of the Group.

          (c)  “Period of Service” means a period beginning on the Associate’s Employment Commencement Date (or Reemployment Commencement Date, as the case may be) and ending on his Severance from Service Date.

          (d) “ Severance from Service Date” means the earlier to occur of:

          (i) the last date upon which an Associate terminates employment with the Employer or any other member of the Group (either voluntarily or involuntarily), retires or dies; or

          (ii) the first anniversary of the date upon which the Associate was first absent from service with the Employer (with or without pay) for any other reason (i.e., vacation, sickness, disability, leave of absence or layoff).

Notwithstanding the foregoing, the Severance from Service Date of an Associate who is absent from service with the Employer beyond the first anniversary of the first day of such absence on account of maternity or paternity (as described in ERISA Sections 202(b)(5)(A) or 203(b)(3)(E)) shall be the second anniversary of the first day of such absence; and the period of time between such first and second anniversaries shall not be treated as a Period of Service or as a Period of Severance.

13

          (e)  “Period of Severance” means a period beginning on an Associate’s Severance from Service Date and ending upon the Associate’s Reemployment Commencement Date.

          (f)  “Reemployment Commencement Date” means the first date, following a Severance from Service Date, upon which the Associate performs an Hour of Service for the Employer or any other member of the Group.

          (g)  “Service Spanning Rules” In determining whether or not an Associate has completed a twelve month Period of Service for purposes of vesting, the following Periods of Severance shall be treated as Periods of Service:

          (i) If an Associate terminates employment with the Employer (either voluntarily or involuntarily) or retires, and then performs an Hour of Service within the twelve month period beginning on the Severance from Service Date, such Period of Severance shall be treated as a Period of Service; and

          (ii) If an Associate terminates employment with the Employer (either voluntarily or involuntarily) or retires during an absence from service of twelve months or less for any reason other than a termination or retirement, and then performs an Hour of Service within a period of twelve months from the date the Employee was first absent from service, the Period of Severance shall be treated as a Period of Service.

SECTION 2

Membership

2.01 Conditions of Eligibility.

          (a)  Each Associate who on April 30, 2002, was a Member of or is eligible to be a Member of the Plan shall continue to be a Member of the Plan entitled to make Member Contributions pursuant to Section 4 and eligible to share in Company Contributions pursuant to Section 3.

          (b)  Each other Associate shall be eligible to become a Member of the Plan when the Associate attains age 21 and meets such other eligibility criteria for part-Time and Full Time Associates as set forth below. Once determined eligible, membership commences as of the first day of the month coincident with or following the date the Associate has met the applicable eligibility requirements. Such Associate shall be eligible:

          (i) to make Member Contributions pursuant to Section 4;

14

          (ii) to share in Company Matching Contributions pursuant to Section 3.02;

          (iii) to share in Company Profit Sharing Contributions, if any, pursuant to Section 3.01.

Notwithstanding the foregoing, effective January 1, 2006, a Full Time Associate shall be eligible to make Member Contributions pursuant to Section 4 as of the first day of the month coincident with or following the date he has completed 60 days of employment with the Employer and attained age 21. Further, a Full-Time Associate shall be eligible to receive a Company Matching Contribution coincident with or following the date he has completed 180 days of service with the Company and satisfied the requirements of Section 3.03. For the purpose of the preceding sentence, a “Full Time Associate” is an Associate classified on the Employer’s records as a Full Time Associate. In many locations, this means the Associate is normally scheduled to work 32 or more hours per week. However, the Associate’s classification on the Employer’s records, and not the actual number of hours worked in any period, determines Full Time status. Effective January 1, 2007, a Part Time Associate shall be eligible to make Member contributions pursuant to Section 4 as of the first day of the month coincident with or following the date he has completed one full year of employment. Prior to the effective date of January 1, 2007, Part Time Associates must have completed one full Year of Service to be eligible to make Member Contributions. Part Time Associates must complete one full year of employment and satisfy the requirements under Section 3.03 to be eligible to receive a Company Matching Contribution.

          (c)  Each Member shall be deemed to have elected to make a three percent (3%) Before-Tax Contribution pursuant to Section 4.01(b), commencing with the paycheck issued with respect to the first payroll period beginning on or after the first day of the month coincident with or following the date he met the foregoing eligibility requirements. Notwithstanding this “deemed” election, an Associate or Member may elect pursuant to procedures established by the Committee to not make, or to suspend making, said three percent (3%) automatic Before-Tax Contribution, or pursuant to Section 4.01(a) or (b)  to make an After-Tax or a Before-Tax Contribution of an amount other than three percent (3%).

          (d)  Only Associates employed by the Company’s Puerto Rican subsidiaries are eligible for membership hereunder. Any other Associate who has Accounts in this Plan, such Accounts shall continue to be revalued as of each succeeding Valuation Date pursuant to Section 6.04.

15

SECTION 3

Company Contributions

     3.01 Amount of Company Profit Sharing Contribution. The Company or an Employer may contribute to the Trust, as of the end of each Plan Year, a percentage of the Company’s Net Profits as a Company Profit Sharing Contribution. The amount of such contribution, if any, shall be determined by the Board of Directors in its discretion. Any such contribution shall be made as soon as practicable after the close of the Company’s Fiscal Year. All such contributions advanced to the Plan by the Company shall be reimbursed to the Company by the Employer.

     3.02 Amount of Company Matching Contribution. The Company, in its discretion, shall contribute to the Trust, as of the end of each Plan Year, such that the amount contributed to this Plan and to the Payless ShoeSource, Inc. Profit Sharing Plan shall be equal to 2¹/2% of Net Profits, until determined otherwise by the Board of Directors, in the form of a Company Matching Contribution. Effective beginning with the 2005 Plan Year, the Board has determined that a minimum guaranteed Company Matching Contribution of $.25 per $1.00 of Member Contributions up to 5% of Pay will be contributed each Plan Year by the Company. Such Company Matching Contributions may be made by an Employer, rather than by the Company, as to that Employer’s participating Associates. The total amount of such contribution shall be allocated in proportion to the amount that each Member’s Contributions under Sections 4.01(a) and (b), up to a total of 5% of such Member’s Pay for a Plan Year, bears to the total amount of all Member Contributions up to 5% of such Members’ Pay for a Plan Year. Such Company Matching Contribution shall be determined and paid to the Trustee as soon as practicable after the close of each Fiscal Year and shall be reimbursed to the Company by the Employer when paid.

     3.03 Allocation of Company Contributions. The Company Contributions shall be allocated only to the Company Accounts of Members who are employed by the Employer on the last day of the Plan Year and on behalf of Members whose employment has terminated during the Plan Year by reason of Retirement, death or Disability. Company Profit Sharing Contributions shall be credited to eligible Members’ Company Profit Sharing Contribution Accounts. Company Profit Sharing Contributions allocated prior to or as of July 31, 1997 shall be fully vested; Company Profit Sharing Contributions allocated thereafter shall be subject to the vesting provisions of Section 6.07. Company Matching Contributions shall be subject to the vesting provisions of Section 6.07 and to the withdrawal penalty provisions of Section 8.02(a). No Company Matching Contribution shall be made with respect to a Member Before-Tax Contribution in excess of the PR Code Section 1165(e)(7)(A) limit, as referred to in Section 4.01(h) and as revised from time to time.

     3.04 Profit Sharing Allocation Formula. The Company Profit Sharing Contribution, if any, shall be allocated to all Members eligible to share in the contribution

16

according to the ratio that each Member’s Allocation Pay Amount for the Plan Year bears to the total Allocation Pay Amount for all eligible Members for the Plan Year. For this purpose the term “eligible Members” includes Members in both the Payless ShoeSource, Inc. 401(k) Profit Sharing Plan and this Plan.

     3.05 Investment of the Company Contribution. The amounts allocated to each Member pursuant to Section 3.03 shall be credited to his Company Accounts and invested in one or more of the Investment Funds described in Section 5.01 and in the percentages designated by the Member in the investment election filed pursuant to Section 5.02 effective at the time the amount is allocated.

     3.06 Return of Company Contributions.

          (a)  If, after the Company Contribution has been made and allocated, it should appear that, through oversight or a mistake of fact or law, a Member (or an Associate who should have been considered a Member) who should have been entitled to share in such contribution, receives no allocation or received an allocation which was less than he should have received, the Company may, at its election and in lieu of reallocating such contribution, make a special make-up contribution for the Company Account of such Member in an amount sufficient to provide for him the same addition to his Company Account as he should have received. Similarly, if a Member received an allocation which was more than he should have received (or a Member was inappropriately included in the Plan), the Company, at its election, may reallocate such contribution, offset other Company contributions against such allocation, or use such allocation to pay Plan expenses.

          (b)  To the extent permitted by ERISA, each contribution made to the Trust shall be made on the condition that it is currently deductible by the Employer under PR Code Section 1023(A) for the taxable year with respect to which the contribution is made. If a contribution subsequently is determined, whether in whole or in part, not to be currently deductible as provided in the preceding sentence, then, within one year of the date of disallowance of the deduction of such Company Contribution, an amount equal to the disallowed deduction shall be returned to the Company and/or Employer, as applicable.

          (c)  Earnings attributable to a contribution that is returned pursuant to Subsection (a)  or (b) above shall not be withdrawn, but losses attributable thereto shall reduce the amount returned to the Company and/or Employer.

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SECTION 4

Member Contributions

     4.01 Procedure for Making Contributions.

          (a) After-Tax Contributions. Subject to any limitations set forth in the PR Code from time to time, each Member may designate, pursuant to procedures established by the Company, and contribute to the Plan an amount equal to not less than 1% nor more than 15% (in whole percentage points) of his Pay as he shall have designated pursuant to procedures established by the Company (which may establish lower permissible After-Tax Contributions for Highly Compensated Employees); provided, however, that a Member shall not contribute, or elect to have contributed on his behalf, amounts with respect to Pay received by him after the close of the calendar year during which his employment terminated and further provided that any Before-Tax Contributions made on behalf of the Member shall reduce by the percentage which he elects to have contributed pursuant to Section 4.01(b)(i), the percentage of Pay that the Member may contribute pursuant to this Section 4.01(a). Notwithstanding any provision in the Plan to the contrary, in no event may After-Tax Contributions exceed 10% of the Members accumulated Pay since he or she became a Member in the Plan without taking into consideration any Member’s After-Tax Contribution subject to Company Matching Contributions.

     (b) Before-Tax Contributions.

     (i) Subject to the limitations set forth below, each Member may elect that his Employer shall contribute directly to the Trust Fund an amount equal to a whole percentage of his Pay, not less than 1% nor greater than such percentage as may be determined from time to time by the Company which amount shall be his Before-Tax Contribution. The maximum Before-Tax Contribution by a Member who is determined to be a Highly Compensated Employee under Section 4.02, for the Plan Year in question, may be further restricted or limited by the Company or the Committee from time to time.

     (ii) Pursuant to Section 2.01(c), each eligible Member shall be deemed to have elected to make a three percent (3%) Before-Tax Contribution, unless the Member elects otherwise in accordance with procedures established by the Committee.

          (c) Notwithstanding any election in accordance with Section 4.01 (b), if the Committee at any time determines that all or any portion of the Member’s Before-Tax Contributions should be treated as After-Tax Contributions in order for the Before-Tax Contribution provisions of the Plan to quality as a “qualified cash or deferred arrangement” for purposes of Section 1165(e) of the PR Code, or if the Actual Deferral

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Percentage standards set forth in the PR Code are not met at the end of the Plan Year; then the Committee, in its sole and absolute discretion, (i) may, in accordance with Section 4.02(b) below, limit the amount which shall be contributed by the Employer as Before-Tax Contributions after the date of such determination on behalf of all or any portion of the Members and (ii) shall distribute any excess Before-Tax Contributions made with respect to the Plan Year to the affected Members as soon as practicable after the end of the Plan Year.

          (d) The Employer shall (i) deduct a Member’s After-Tax Contributions from the Pay of the Member in such installments as the Employer may deem appropriate, (ii) contribute a Member’s Before-Tax Contributions on behalf of the Member, and (iii) reduce the Pay that is paid to the Member directly in cash by an amount equal to the Member’s Before-Tax Contributions in such installments as the Employer shall deem appropriate. The amounts so deducted and so contributed shall be paid by the Employer to the Trustee not later than 15 days following the end of the month with respect to which such amounts are to be so deducted and contributed or within such shorter period of time as may be designated under the Code, ERISA or related regulations. The Employer may, from time to time, make estimated contribution payments to the Trustee during each month.

          (e) Effective with the paycheck issued with respect to the first payroll period beginning in any calendar month, or as of such other effective time as may be determined by the Committee, a Member may elect to change the rate of his After-Tax Contributions to any other rate permitted by Subsection (a) of this Section 4.01 and may elect to change the amount to be contributed by the Employer directly to the Trust Fund as Before-Tax Contributions to an amount equal to an amount permitted by Subsection (b) of this Section 4.01 with respect to such contributions to be made after the effective date of the election, pursuant to procedures established by the Committee.

          (f) Not later than 15 days prior to the beginning of a payroll period of a Member, or not later than such other date as may be determined by the Committee, such Member may elect, pursuant to procedures established by the Committee, (i) to suspend making After-Tax Contributions and (ii) that the Employer should suspend making Before-Tax Contributions on his behalf, all as of the beginning of such payroll period. Not later than 15 days prior to the beginning of a payroll period of a Member, or not later than such other date as may be determined by the Committee, such Member may elect (i) to resume making After-Tax Contributions and (ii) that the Employer shall resume making Before-Tax Contributions on his behalf, by indicating any amount of contributions permitted under Subsection (a) and designating an amount equal to any amount of Pay as Before-Tax Contributions that is permitted under Subsection (b) hereof.

          (g) Contributions pursuant to this Section 4.01 shall be credited to Member Accounts.

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          (h) Notwithstanding any election in accordance with paragraph (b) of this Section 4.01, the total amount of a Member’s Before-Tax Contributions for any calendar year shall not exceed $8,000 or 10% of the Member’s annual Pay or such other amount as may be adjusted from time to time under applicable Puerto Rico law (the “Deferral Limit”). In addition, Before-Tax Contributions by a Member will be further limited by contributions to an individual retirement account as described in PR Code Section 1169. If a Member reaches the Deferral Limit, the Committee can direct that all or any portion of such Member’s Contributions during such year shall be After-Tax Contributions regardless of such Member’s elections pursuant to Sections 4.01(a) and 4.01(b).

          (i) As of April 1, 2000, all then currently existing flat dollar Member Contributions shall be converted to Member Contributions based on 1% increments calculated by dividing such flat dollar amount by the Member’s Pay for the prior year and rounding the product to the nearest whole percent; provided, that no flat dollar contribution shall be converted to a percent contribution of less than 1%.

          (j) Notwithstanding this Section 4.01, effective March 20, 2000, during the black out period as determined by the Committee and the Trustee established to change to daily valuation or a change in recordkeepers, no contribution rate changes or suspensions may be made by a Member except as provided by the Committee.

4.02 Limitations on Before-Tax Contributions.

          (a) Notwithstanding the foregoing provisions of this Section 4, the Committee shall limit the amount of Before-Tax Contributions made on behalf of each “Highly Compensated Employee” (as hereinafter defined) to the extent necessary to ensure that either of the following tests is satisfied:

          (i) The “Actual Deferral Percentage” (as hereinafter defined) of the group of eligible Highly Compensated Employees for the Plan Year is not more than the Actual Deferral Percentage of all other eligible Associates (“non-Highly Compensated Employees”) multiplied by 1.25; or

          (ii) The excess of the Actual Deferral Percentage for the group of eligible Highly Compensated Employees over that of all other eligible Associates for the Plan Year is not more than two percentage points, and the Actual Deferral Percentage for the group of eligible Highly Compensated Employees for the Plan Year is not more than the Actual Deferral Percentage of all other eligible Associates multiplied by 2.0.

          (iii) To the extent permitted by the Act, the Actual Deferral Percentage for non-Highly Compensated Employees used in satisfying the tests set forth in (i) and/or (ii) above may be, for any Plan Year, the Actual Deferral Percentage for non-Highly Compensated Employees for the immediately

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preceding Plan Year, as determined by the Company in the manner permitted by law.

     For the purposes of this Section 4.02, Section 4.04 and Section 4.05, “eligible” means eligible to be a Member of this Plan pursuant to Section 2.01(b)(1).

     For purposes of Sections 4.02, 4.04 and 4.05, the term “Highly Compensated Employee” shall mean any employee whose Pay is greater than the Pay of two-thirds of all eligible employees, taking into account only Pay which is considered for the purpose of Section 4.01. To the extent permitted by the PR Code and its regulations, the Committee may elect to include all other non-eligible employees for the purposes of determining compliance by the Plan with the actual deferral percentage test of PR Code Section 1165.

     For purposes of this Section 4.02, the term “Actual Deferral Percentage” shall mean, for a specified group of Associates for a Plan Year, the average of the ratios (calculated separately for each person in such group) of

          (i) The aggregate of the Before-Tax Contributions (and such other contributions which, in accordance with applicable rules and regulations promulgated under the PR Code, may be aggregated with such Before-Tax Contributions for purposes of demonstrating compliance with the requirements of the PR Code) which are actually payable to the Trust on behalf of each such Associate, to

          (ii) Such Associate’s Pay for such Plan Year.

     In the event it is determined prior to any payroll period that the amount of Before-Tax Contributions elected to be made thereafter would cause the limitation prescribed in this Section 4.02 to be exceeded, the amount of Before-Tax Contributions allowed to be made on behalf of Highly Compensated Employees (and/or such other Members as the Committee may prescribe) shall be reduced to a rate determined by the Committee, and any elections of future Before-Tax Contributions which exceed the rate determined by the Committee shall be deemed to be After-Tax Contributions for the remainder of the Plan Year, notwithstanding the limitations on contribution rate changes in Section 4.01(e). Except as is hereinafter provided, the Members to whom such reduction is applicable and the amount of such reduction shall be determined pursuant to such uniform and nondiscriminatory rules as the Committee shall prescribe.

          (b) Notwithstanding the provisions of the foregoing paragraph, with respect to any Plan Year in which Before-Tax Contributions on behalf of Highly Compensated Employees exceed the applicable limit set forth in this Section 4.02, the Committee shall reduce the amount of the excess Before-Tax Contributions made on behalf of the Highly Compensated Employees (by reducing such contributions in order of Actual Deferral Percentages beginning with the highest), and shall distribute such excess Before-Tax Contributions (along with earnings attributable to such excess Before-Tax

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Contributions, as determined pursuant to such rules and regulations as shall be prescribed by the Puerto Rico Department of the Treasury) to the affected Highly Compensated Employees as soon as practicable after the end of such Plan Year, and in all events prior to the end of the next following Plan Year. Any excess Before-Tax Contributions to be returned to Highly Compensated Employees shall be calculated (i.e., reduced) and distributed by first reducing the Before-Tax Contributions of the Highly Compensated Employees with the largest dollar amount(s) of Before-Tax Contributions (rather than with the highest Percentage(s) to the extent required or permitted under the Act. In lieu of such distribution of excess Before-Tax Contributions, the Committee may, to the extent permitted by applicable rules and regulations (and (i) except with respect to situations in which Section 4.01 (h) applies, and (ii) prior to March 15 of the calendar year following the Plan Year in which such contributions are made or such later date as may be permitted under the PR Code), recharacterize as After-Tax Contributions for such Plan Year all or a portion of the Before-Tax Contributions for Members who are Highly Compensated Employees to the extent necessary to comply with the applicable limit set forth in this Section 4.02.

     In lieu of either distributing or recharacterizing excess Before-Tax Contributions, the Company may, to the extent permitted by applicable rules and regulations, make a qualified nonelective contribution on behalf of non-Highly Compensated Employees in an amount sufficient to satisfy one of the non-discrimination tests set forth above, which Company contribution (if any) shall be reimbursed by the Employer. Allocation of any such qualified non-elective contribution would be to the Member Before-Tax Accounts of each non-Highly Compensated Employee in the same proportion that such Member’s Before-Tax Contributions for the year bears to the total Member Before-Tax Contributions for the year for all non-Highly Compensated Employees of the Employer. However, the maximum annual addition credited to a Member’s Account shall be limited by Section 4.06.

          (c) Notwithstanding any provision of Sections 4.02(c) to the contrary, if Before-Tax Contributions on behalf of Highly Compensated Employees in excess of the applicable limit set forth in Section 4.02 either are distributed or are recharacterized, any Company Matching Allocation which would have been attributable to the amounts distributed or recharacterized shall be held unallocated in a suspense account and, as of the end of the Plan Year, forfeited and added to and allocated with Company Contributions in the next following Plan Year.

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4.03 Distributions of Excess Deferrals

          (a) Notwithstanding any other provision of the Plan, Excess Before-Tax Deferrals (as hereinafter defined) and earnings allocable thereto as determined pursuant to such rules and regulations as are prescribed by the Puerto Rico Department of the Treasury, may be distributed no later than April 15 (or such later date as may be permitted under the PR Code) to Members who claim such allocable Excess Before-Tax Amounts (which shall be the “Excess Before-Tax Deferrals” plus earnings, if any) for the preceding calendar year.

          (b) For purposes of this Section 4.03, “Excess Before-Tax Deferral” means the amount of Pay which a Member has elected to have the Employer contribute to the Trust rather than receive it in cash, which is a Member Contribution under Section 4.01 for a calendar year that the Member allocates to this Plan pursuant to the claim procedure set forth in subsection 4.03(c) hereof.

          (c) The Member’s claim shall be in writing; shall be submitted to the Committee no later than March 1 (or such other date as the Committee may specify); shall specify the amount of the Member’s Excess Before-Tax Deferral for the preceding calendar year; and shall be accompanied by the Member’s written statement that if such amounts are not distributed, the Excess Before-Tax Deferrals, when added to amounts deferred under other plans or arrangements described in PR Code Section 1165(e) exceeds the limit imposed on the Member in accordance with the applicable provisions of the PR Code for the year in which the deferral occurred.

          (d) Notwithstanding any provision of Sections 3 or 4 to the contrary, any Company Matching Allocation which would have been attributable to an Excess Before-Tax Deferral distributed to a Member under Section 4.02(a) shall not be retained or distributed (unless and to the extent permitted under the PR Code and so determined by the Company in a uniform, nondiscriminatory manner), but shall be held unallocated in a suspense account and, as of the end of the Plan Year, forfeited and added to and allocated with Company Contributions in the next following Plan Year.

     4.04 Limitations on After-Tax Contributions. Notwithstanding the foregoing provisions of this Section 4, the Company or the Committee, in their respective discretion, may limit the amount of After-Tax Contributions made by or on behalf of each eligible Member to the extent determined appropriate.

     4.05 Limitations on Company Matching Contributions. Notwithstanding the foregoing provisions of Sections 3.02 or this Section 4, the Company or the Committee, in their respective discretion, may limit the amount of Company Matching Contributions allocated on behalf of each eligible Member to the extent determined appropriate.

     4.06 Aggregate Limitations. To the extent required under the PR Code or as so determined by the Company or the Committee, in their respective discretion, Company Matching Contributions and Member After-Tax Contributions may be aggregated on a Member by Member basis and limited, as determined appropriate.

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SECTION 5

Investment Provisions

     5.01 Investment Funds.

          (a) There shall be established as part of the Trust Fund a reasonable range of investment options. The Committee may from time to time, in its discretion, change, delete or add Investment Funds available within the Trust Fund; provided that unless and until the Plan is amended accordingly, the Plan shall provide a Payless Common Stock Fund as an investment option.

          (b) Income from and proceeds of sales of investments in each Investment Fund shall be reinvested in the same Investment Fund. Any income or other taxes payable with respect to a Fund shall be charged to such Fund.

          (c) A Trustee may, from time to time, make temporary investments in short term obligations of the United States Government, commercial paper, or other investments of a short term nature, pending investment in an Investment Fund.

     5.02 Investment Direction.

          (a) A Member may elect that his Member Contributions for each Payroll period be invested in 1% increments totaling 100% in one or more of the Investment Funds. Such election must be made pursuant to procedures prescribed by the Committee. Such election shall be effective until and unless a Member makes a different election for any period, but only as provided for under Subsection 5.02(b) and Subsection 5.02(c). If the Member fails to file a timely initial investment election, he shall be deemed to have elected to have 100% of his Member Contributions and his Company Profit Sharing Contributions invested in the stable, fixed income investment as may be determined by the Committee and 100% of his Company Matching Contributions in the Payless Common Stock Fund. Until such time as the Committee determines otherwise and so notifies Members, a Member’s share of any Company Contributions, when allocated as of Plan Year-end, shall be invested in the same Investment Funds in the same proportions as the Member has elected in connection with investment of his Member Contributions at the time the amount is allocated.

          (b) A Member may change his election with respect to future Member and Company Contributions effective pursuant to procedures prescribed by the Committee, and may not change his election in any other manner except as provided in Subsection 5.02(c).

          (c) Effective as of the date determined by the Committee and pursuant to procedures prescribed by the Committee, a Member may elect to have any or all of the

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value in any of the Investment Funds which are credited to his Member and/or Company Accounts transferred and invested in any one or more of the Investment Funds.

          (d) Notwithstanding this Section 5.02, effective March 20, 2000, during the black out period as determined by the Committee and the Trustee established to change to daily valuation or a change in recordkeepers, no investment transfers or changes may be made by a Member unless provided in Section 6.06. Notwithstanding anything to the contrary, no loans, withdrawals or distributions shall be made during any such blackout period except as provided by the Committee.

SECTION 6

Accounts

     6.01 Member Accounts. The Committee shall maintain or cause to be maintained for each Member under each Investment Fund in which his Member Contributions are invested separate Member Accounts which shall reflect the portion of his interest in such Investment Fund which is attributable to his contributions. The Member’s After-Tax Contributions shall be credited to a separate Member After-Tax Account. The Member’s Before-Tax Contributions shall be credited to a separate Member Before-Tax Account. The Member’s or Associate’s Rollover Contribution shall be credited to a separate Member Rollover Contribution Account.

     6.02 Company Accounts. The Committee shall maintain or cause to be maintained for each Member under each Investment Fund in which his Company Contributions are invested separate Company Accounts which shall reflect the portion of his interest in such Investment Fund which is attributable to Company Contributions, as well as to contributions made by an Employer under Prior Plans and to any income or earnings attributable to such Company Contributions and Prior Plan contributions. The Member’s Company Matching Contributions shall be credited to a separate Company Matching Contribution Account. The Member’s Company Profit Sharing Contribution, if any, shall be credited to a separate Company Profit Sharing Contribution Account.

     6.03 Maintenance of Accounts. For the purposes of maintaining Accounts pursuant to this Section 6, each Investment Fund, shall be divided into Units, and the Interest of each Member in such Investment Fund shall be evidenced by the number of Units in such Investment Fund credited to his Accounts.

     6.04 Valuation of Accounts. As of each Valuation Date the Committee shall determine the value of a Unit in each Account by dividing the current market value of all property in each such Account as of such Valuation Date (after deducting any expenses or other amounts including withdrawals property chargeable against such Account) by the number of Units then outstanding to the credit of all Members in each such Account.

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     6.05 Member Statements. The Committee shall furnish or cause to be furnished to each Member a statement of his Company and Member Accounts, at least once each year, or more frequently if required by applicable law.

     6.06 Shares of Payless ShoeSource, Inc. (“Payless Stock”) in the Payless Common Stock Fund.

          (a) Each Member (or beneficiary of a deceased Member) who has Accounts invested in the Payless Common Stock Fund shall, as a named fiduciary within the meaning of Section 403(a)(1) of ERISA, have the right to direct the Trustee with respect to the vote of the number of shares of Payless Stock attributable to Units credited to him in the Payless Common Stock Fund as of the latest practicable Valuation Date prior to or contemporaneous with the record date set by the Company for each meeting of shareowners of the Company. For such purpose the Trustee shall furnish to each such Member prior to each such meeting the proxy statement for such meeting, together with a form to be returned to the Trustee on which may be set forth the Member’s instructions as to the manner of voting such shares of stock. Upon receipt of such instructions, the Trustee shall vote such shares in accordance therewith. If Member’s instructions are not received by the Trustee in a timely manner, the Trustee shall vote such Member’s shares in the same proportion as the shares of Common Stock for which instructions were actually received from Members. The Trustee shall not divulge the instructions of any Member.

          (b) Each Member (or beneficiary of a deceased Member) who has Accounts invested in the Payless Common Stock Fund shall, as a named fiduciary within the meaning of Section 403(a)(1) of ERISA, have the right with respect to the number of shares of Payless Stock attributable to Units credited to him in the Payless Common Stock Fund as of the latest practicable Valuation Date, to direct the Trustee in writing as to the manner in which to respond to a tender or exchange offer with respect to Payless Stock, and the Trustee shall respond in accordance with the instructions so received. The Trustee shall utilize its best efforts to timely distribute or cause to be distributed to each Member such information as will be distributed to shareowners of the Company in connection with any such tender or exchange offer, together with a form requesting instructions on whether or not such shares will be tendered or exchanged. If the Trustee shall not receive timely direction from a Member as to the manner in which to respond to such a tender or exchange offer, the Trustee shall not tender or exchange any shares of Payless Stock with respect to which such Member has the right of direction. Tenders as a result of a self-tender offer by the Company shall continue notwithstanding any investment change blackout. The Trustee shall not divulge the instructions of any member. The proceeds from the tender or exchange of shares attributable to Units in Payless Common Stock Investment Fund accounts of Members shall be transferred to one of the Investment Funds described in Section 5.01 and pursuant to a procedure established by the Committee.

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     6.07 Vesting in Member and Company Accounts

          (a) Vesting Schedule. A Member shall have a fully vested interest at all times (i) in his Member Accounts and (ii) in his Company Profit Sharing Contribution Account balance determined as of July 31, 1997. A Member who has completed at least two full Years of Service as of August 1, 1997 also shall be fully vested at all times (i) in his Company Matching Contributions Account and (ii) in his Company Profit Sharing Contribution Account determined at any time after July 31, 1997. The Company Matching Contribution Account of a Member who is not or was not credited with at least two Years of Service as of August 1, 1997 and his Company Profit Sharing Contribution Account attributable to Company Profit Sharing Contributions, if any, based on such Member’s eligibility for such contributions after August 1, 1997, shall vest according to the following schedule:

Vesting Service	Vested Interest
Fewer than 2 years	0%
2 years	25%
3 years	50%
4 years	75%
5 years or more	100%

Notwithstanding the foregoing, a Member’s interest in his Company Matching Contribution Account and his Company Profit Sharing Contribution Account shall become fully vested upon the Member’s Retirement, death or Disability.

          (b) Cash-Out Distributions to Partially Vested Members and Restoration of Forfeitures. If, pursuant to Section 10.01, a partially-vested Member receives a cash-out distribution before he incurs a Forfeiture Break in Service (as defined in Subsection (e) below), the cash-out distribution will result in an immediate forfeiture of the nonvested portion(s) of the Member’s Company Matching and Company Profit Sharing Contribution Account(s). See Subsection (e) below. A partially-vested Member is a Member whose Vested Interest, determined under Section 6.07(a), in either his Company Matching Contribution Account or his Company Profit Sharing Contribution Account, or both, is less than 100%. A cash-out distribution is a distribution of the entire vested portion of the Member’s Account(s).

          (i) A partially-vested Member who is reemployed by an Employer after receiving a cash-out distribution of the vested portion of his Account(s) shall have such forfeited amount restored, unless the Member no longer has a right to restoration under this subparagraph (i). The amount restored by the Plan Administrator shall be the same dollar amount as the dollar amount of his Account(s) on the Valuation Date immediately preceding the date of the cash-out distribution, unadjusted for any gains or losses occurring subsequent to that

27

Valuation Date but reduced by the amount of the prior cash-out distribution. Restoration of the Member’s Account balance(s) includes restoration of all US Code Section 411(d)(6) protected benefits with respect to the restored Account(s) in accordance with applicable Treasury regulations. The Plan Administrator will not restore a reemployed Member’s Account balance(s) under this subparagraph (i) if the Member has incurred a Forfeiture Break in Service (as defined in Subsection (d) below).

          (ii) If restoration of the Member’s Account(s) is permitted under subparagraph (i) above, the Plan Administrator will restore the Member’s Account(s) as of the last day of the Plan Year during which such Member was reemployed by an Employer. To restore the Member’s Account(s), the Plan Administrator, to the extent necessary, will allocate to the Member’s Account(s):

          (A) first, the amount, if any, of Member forfeitures otherwise available for allocation under Subsection (e) below;

          (B) second, deductible Employer contributions for the Plan Year to the extent made under a discretionary formula; and

          (C) third, as otherwise permitted by law.

The Plan Administrator will not take into account any allocation under this subsection (b) in applying the limitation on allocations under Section 13.

          (iii) The deemed cash-out rule applies to a 0% vested Member. A 0% vested Member is a Member whose Account(s) derived from Employer contributions is (are) entirely forfeitable at the time of his termination of employment. Under the deemed cash-out rule, the Plan Administrator will treat the 0% vested Member as having received a cash-out distribution on the date of the Member’s termination of employment or, if the Member’s Account(s) is (are) entitled to an allocation of Employer contributions for the Plan Year in which he terminates employment, on the last day of that Plan Year.

          (c) Determination of Vesting Service. For purposes of determining a Member’s Vested Interest in his Company Contributions Account(s) under subsection (a) above, a Member shall be credited with that number of years of Vesting Service determined by adding together all of the Associate’s Periods of Service, whether or not consecutive. Notwithstanding the foregoing, Vesting Service shall not include any Period of Service before the Plan Year in which an Associate attains age eighteen (18). Only whole years of service shall be taken into account for purposes of applying the schedule set forth in subsection (a) above, and, for purposes of determining a Member’s number of whole years of service, non-successive Periods of Service must be aggregated, with 365 days of service being deemed to constitute one year. For purposes of determining a

28

Member’s Period of Service, the Service Spanning rules described in Section 1.52(g) shall apply.

          (d) Forfeiture Break in Service. For purposes of this Section 6.07, a “Break in Service” is a Period of Severance of at least 365 consecutive days. A “Forfeiture Break in Service” occurs when a Member of former Member incurs 5 consecutive Breaks in Service.

          (e) Forfeiture Occurs. A Member’s forfeiture, if any, of his Account balance(s) derived from Company contributions occurs under the Plan on the earlier of:

          (i) the last day of the last pay period ending within the Plan Year in which the Member first incurs a Forfeiture Break in Service; or

          (ii) the date the Member receives a cash-out distribution.

     The Plan Administrator shall determine the percentage of a Member’s Account(s) forfeiture, if any, under this Subsection (e) solely by reference to the vesting schedule of Section 6.07(a). As of the last day of each Plan Year, the total amount of forfeitures which occurred during such Plan Year shall be calculated and such amount shall be applied (i) to restore under (b) above any amounts previously forfeited from rehired Members’ Accounts and (ii) the balance, if any, shall be added to and allocated with the Company Matching Contribution for that Plan Year.

          (f) Former May Plan Members. The provisions of this subsection (g) apply to a Member who previously was employed by the Employer, when it was part of the Group which included The May Department Stores Company, and who at the termination of his employment had Company Accounts in the May Plan which were forfeited as a result of termination of employment. If such Member has not incurred five consecutive one-year Breaks in Service as defined in Section 6.07(d), the value of the Member’s Company Account forfeited under the May Plan will be restored under this Plan (in the manner described in Subsection (b) above) and will be 100% vested.

SECTION 7

Expenses

     7.01 Administrative Expenses. To the extent permitted by applicable law, the costs and expenses for administering this Plan, consisting of Trustee fees and expenses, Investment Manager fees and expenses, fees and expenses of outside experts, expenses of maintaining records under Section 6 of the Plan, and all other administrative expenses of

29

the Plan, shall be paid out of the Trust Fund unless the Company or the Employer elects to pay them with its own funds. Costs incident to the purchase and sale of securities, such as brokerage fees, commissions and stock transfer fees, are not regarded as administrative expenses and shall be borne by the appropriate Investment Fund as determined by the Trustee or Committee.

SECTION 8

Withdrawals During Employment

     8.01 Withdrawals Prohibited Unless Specifically Authorized. No withdrawal from the Plan shall be permitted prior to a Member’s termination of employment, except as provided in Section 8.02.

     8.02 Authorized Withdrawals.

          (a) Prior to his termination of employment, a Member may elect to withdraw, in cash, any or all of the value in his Member After-Tax Accounts. However, in the event a Member elects to withdraw all or a portion of his After-Tax Contributions made after August 1, 1997, such Member shall forfeit his right to fifty percent (50%) of the Company Matching Contribution, if any, otherwise allocable in connection with his Member Contributions for the Plan Year in which the withdrawal occurs.

          (b) Prior to his termination of employment, a Member may elect to withdraw, in the event of a “hardship”, an amount in cash equal to (i) the total amount of the Before-Tax Contributions made to the Trust on his behalf, or (ii) the value in his Member Before-Tax Account whichever is less provided, however, that no withdrawal will be permitted to the extent that loans from the Plan are available to the Member. In any event the amount withdrawn may not be greater than the amount determined by the Committee as being required to meet the immediate financial need created by the “hardship” and not reasonably available from other resources of the Member, whichever amount is less. The term “hardship” means a heavy financial hardship in light of immediate and heavy financial needs as determined by the Committee in accordance with the PR Code regulations. The amount of an immediate and heavy financial need may include any amounts necessary to pay any federal, state or local taxes or penalties reasonably anticipated to result from the distribution. The determination shall be made in a nondiscriminatory manner. Hardship shall include but not be limited to the following:

          (i) Medical expenses described in PR Code Section 1023(aa)(2)(P), previously incurred by the Member, the Member’s spouse, or any of the Member’s dependents (as defined in PR Code Section 1025);

          (ii) Purchase (excluding mortgage payments) of a principal residence for the Member;

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          (iii) Payment of tuition, related educational fees, and room and board expenses for the next 12 months of post-secondary education for the Member, his or her spouse, children, or dependents (as defined in PR Code Section 1025);

          (iv) The need to prevent the eviction of the Member from his or her principal residence or foreclosure on the mortgage of the Member’s principal residence.

          (v) (Effective January 1, 2006). Payments for burial or funeral expenses for a Member’s deceased parent, spouse, children or dependents so long as consistent with the PR Code.

          (vi) (Effective January 1, 2006). Expenses for the repair of damage to Member’s principal residence that would qualify for the casualty deduction, if any, under the PR Code.

The Committee may adopt written guidelines which identify additional circumstances constituting hardship and which provide procedures to be followed in the administration of hardship withdrawal requests, which guidelines are hereby incorporated herein.

     In addition, such hardship must be one which in the judgment of the Committee, based on the Member’s representations, cannot be relieved (1) through reimbursement or compensation by insurance or otherwise, (2) by reasonable liquidation of the Member’s assets to the extent such liquidation would not itself cause an immediate and heavy financial need, (3) by cessation of Member Contributions under the Plan or (4) by other distributions from employee benefit plans maintained by the Company or any other employer or by borrowing from commercial sources on reasonable commercial terms. The Member shall be required to submit documentation, to be determined by the Committee, with his hardship withdrawal request to enable the Committee to make a judgment regarding the validity of such hardship withdrawal request. For any Member who has attained age 59 1/2, the “hardship” requirement shall be deemed waived.

          (c) A Member who was a Participant in or eligible to be a Participant in the Volume Shoe Corporation Profit Sharing Plan (the “Volume Plan”) as of December 31, 1988 and who had an account balance in the Volume Plan attributable to Employer Contributions made to the Volume Plan before July 31, 1976 and which account became a Company Account under The May Department Stores Company Profit Sharing Plan and which has been transferred to this Plan, shall be entitled to withdraw the market value of such account balance determined (and frozen) as of December 31, 1988.

          (d) Associates with Member Rollover Contribution Accounts may elect to withdraw their Member Rollover Contribution Accounts prior to termination of employment.

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          (e) A withdrawal election shall be made pursuant to application procedures established by the Committee. Contribution totals and Account values shall be determined as of the Valuation Date coinciding with or next following the filing of the withdrawal election. If the Member Accounts from which withdrawal is made are in more than one Investment Fund, the withdrawal shall be pro rata from each such Investment Fund except in the case the Member is subject to Section 16 of the Securities Exchange Act of 1934 or has been designated as a “Designated Insider,” in which case such Member’s withdrawal will be taken first from such Member’s Investment Funds other than the Payless Common Stock Fund.

SECTION 9

Benefits Upon Retirement, Death, Disability, or Termination of Employment

     9.01 Benefits. Upon a Member’s Retirement, Death, Disability, or other termination of employment, the value of his Member Accounts and of his vested Company Accounts shall be determined as of the Valuation Date prior to the date the distribution is calculated. A temporary Authorized Leave of Absence for Military Service or for other purposes approved by the Company and/or the Employer shall not, while any such Authorized Leave of Absence is validly in effect be regarded as a termination of employment.

     9.02 Beneficiary. Any benefits payable on account of a Member’s death shall be paid to such Member’s spouse. If such Member has no spouse or if such Member’s spouse shall have consented to the naming of another beneficiary, such benefits shall be paid to the person or persons (including, without limitation, estates, trust, or other entities) last named as beneficiary by such Member on an appropriate form filed with the Committee. A spouse’s consent shall acknowledge the effect of the consent and be in writing, witnessed by a Plan representative or notary public. A spouse’s consent shall be irrevocable. If no beneficiary has been so named or the named beneficiary does not survive the Member, any payment to be made under this Plan on account of a Member’s death shall be paid to such Member’s spouse, or, if he has no spouse, to such Member’s estate. Whenever permitted by ERISA or regulations thereunder, the Committee may waive the requirements that a spouse’s consent be obtained. Such waiver may be on a case by case basis or by categories.

SECTION 10

Payment of Benefits

     10.01 Time of Payment.

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          (a) All amounts distributable to a Member or Beneficiary pursuant to Section 9 shall, unless the Member makes an approved election pursuant to Section 10.01 (b) or 10.01 (c), be paid in a lump sum payment to be made as soon as practicable after the request is received, provided however, that any additional amounts which may be allocated to a Member’s Company Accounts resulting from a Company Contribution in respect of the calendar year in which employment terminates shall be paid as soon as practicable after such contribution.

     Notwithstanding any provision of this Section 10 to the contrary, if the present value of the nonforfeitable accrued benefit of a Member, including Company and Member Contributions (but excluding accumulated deductible employee contribution, if any) exceeds (or for distributions prior to March 22, 1999, ever has exceeded) $5,000, no partial or total distribution shall be made unless the Member has consented thereto in writing in the manner required by law.

          (b) Any Member who was a Member of the May Plan as of June 30, 1990 may elect that all Transferred Accounts distributable to him pursuant to Section 9 shall be paid in annual installments over a period not to exceed ten years beginning with the Valuation Date as of which the lump sum payment would otherwise be made. In the event of the death of a Member prior to the expiration of such period, all amounts which have not been distributed to him shall be paid in a lump sum to his designated Beneficiary or his estate if there is no designated Beneficiary. Subject to the foregoing, each such installment shall be paid as of a Valuation Date and, until all the Accounts of the Member have been fully distributed, they shall continue to be revalued as of each succeeding Valuation Date pursuant to Section 6.04.

     Notwithstanding the paragraph above, any Member who as of December 31, 1988 was or was entitled to be a Participant in the Volume Shoe Corporation Profit Sharing Plan may elect that all Transferred Accounts distributable to him pursuant to Section 9 be paid in the form of equal monthly installments over a period not to exceed 120 months. Such payments shall otherwise be made in accordance with the foregoing portion of this Subsection 10.01 (b).

          (c) A Member who is entitled to receive a distribution in excess of $5,000 may elect to defer such distribution to the required minimum distribution age, as determined by law from time to time. An election to defer distribution shall conform to such requirements as to form, content, manner, and timing as shall be determined by the Committee and which requirements shall be applied in a manner which does not discriminate in favor of Members who are highly compensated employees (within the meaning of Code Section 414(q)). All Accounts of a Member who elects to defer his distribution shall continue to be revalued as of each succeeding Valuation Date pursuant to Section 6.04. A deferred distribution shall be paid when such Member attains the required minimum distribution age or at such earlier or later time as shall be determined by the Committee as permitted by law. In the event of the death of a Member prior to distribution of the deferred amounts, all amounts shall be distributed in a lump sum to his

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designated Beneficiary or to his estate if there is no designated Beneficiary. The value for payment shall be determined as of the Valuation Date coincident with or next following such Member’s birthday coincident with the Member’s required minimum distribution age or such other payment date determined by the Committee.

     10.02 Form of Payment. All distributions shall be made in the form of cash, except that distributions from the Payless Common Stock Fund shall be made in the form of full shares of Payless Common Stock, as applicable (with payment in cash for a fraction of a share) or in cash if elected by the Member or Beneficiary. The rights extended to a Member hereunder shall also apply to any Beneficiary or alternate payee of such Member.

     10.03 Indirect Payment of Benefits. If any Member or Beneficiary has been adjudged to be legally, physically or mentally incapable or incompetent, payment may be made to the legal guardian or other legal representative of such Member or Beneficiary as determined by the Committee. Such payments shall constitute a full discharge with respect thereto.

     10.04 Inability to Find Member. If a Member or Beneficiary or other person to whom a benefit payment is due cannot be found during the three years subsequent to the date a distribution was required to be made under this Plan, the Accounts shall be forfeited at the end of such three-year period. The value of such Accounts as of the date the distribution was required to be made shall be restored if such Member or Beneficiary or other person makes a claim.

10.05 Required Minimum Distributions.

          Notwithstanding anything to the contrary contained in the Plan, the entire interest of a Member will be distributed in accordance with Code Section 401(a)(9) and the regulations thereunder beginning no later than the Member’s Required Beginning Date. The provisions of this Section will apply for purposes of determining required minimum distributions for calendar years beginning with the 2003 calendar year. Notwithstanding the other provisions of this Section, distributions may be made under a designation made before January 1, 1984, in accordance with section 242(b)(2) of the Tax Equity and Fiscal Responsibility Act (TEFRA) and the provisions of the Plan that relate to section 242(b)(2) of TEFRA.

     (a) If the Member dies before distributions begin, the Member’s entire interest will be distributed, or begin to be distributed, no later than as follows:

     (1) If the Member’s surviving spouse is the Member’s sole designated beneficiary, then distributions to the surviving spouse will begin by December 31 of the calendar year immediately following the calendar year in which the Member died, or by December 31 of the calendar year in which the Member would have attained age 70¹/2, if later.

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     (2) If the Member’s surviving spouse is not the Member’s sole designated beneficiary, then distributions to the designated beneficiary will begin by December 31 of the calendar year immediately following the calendar year in which the Member died.

     (3) If there is no designated beneficiary as of September 30 of the year following the year of the Member’s death, the Member’s entire interest will be distributed by December 31 of the calendar year containing the fifth anniversary of the Member’s death.

     (4) If the Member’s surviving spouse is the Member’s sole designated beneficiary and the surviving spouse dies after the Member but before distributions to the surviving spouse begin, this subsection, other than subsection (a)(1), will apply as if the surviving spouse were the Member.

For purposes of this subsection, unless subsection (a)(4) applies, distributions are considered to begin on the Member’s Required Beginning Date. If subsection (a)(4) applies, distributions are considered to begin on the date distributions are required to begin to the surviving spouse under subsection (a)(1). To the extent the Plan provides for distributions in the form of annuities, if distributions under an annuity purchased from an insurance company irrevocably commence to the Member before the Member’s Required Beginning Date (or to the Member’s surviving spouse before the date distributions are required to begin to the surviving spouse under subsection (a)(1)), the date distributions are considered to begin is the date distributions actually commence.

     (b) Unless the Member’s interest is distributed in the form of an annuity purchased from an insurance company or in a single sum on or before the Required Beginning Date, as of the first distribution calendar year distributions will be made in accordance with subsections (c) and (d). To the extent the Plan provides for distributions in the form of annuities, if the Member’s interest is distributed in the form of an annuity purchased from an insurance company, distributions thereunder will be made in accordance with the requirements of Code Section 401(a)(9) and the Treasury regulations.

     (c) During the Member’s lifetime, the minimum amount that will be distributed for each distribution calendar year is the lesser of:

     (1) the quotient obtained by dividing the Member’s account balance by the distribution period in the Uniform Lifetime Table set forth in section 1.401(a)(9)-9 of the Treasury regulations, using the Member’s age as of the Member’s birthday in the distribution calendar year; or

     (2) if the Member’s sole designated beneficiary for the

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distribution calendar year is the Member’s spouse, the quotient obtained by dividing the Member’s account balance by the number in the Joint and Last Survivor Table set forth in section 1.401(a)(9)-9 of the Treasury regulations, using the Member’s and spouse’s attained ages as of the Member’s and spouse’s birthdays in the distribution calendar year.

Required minimum distributions will be determined beginning with the first distribution calendar year and up to and including the distribution calendar year that includes the Member’s date of death.

     (d) If the Member dies on or after the date distributions begin and there is a designated beneficiary, the minimum amount that will be distributed for each distribution calendar year after the year of the Member’s death is the quotient obtained by dividing the Member’s account balance by the longer of the remaining life expectancy of the Member or the remaining life expectancy of the Member’s designated Beneficiary, determined as follows:

     (1) The Member’s remaining life expectancy is calculated using the age of the Member in the year of death, reduced by one for each subsequent year.

     (2) If the Member’s surviving spouse is the Member’s sole designated beneficiary, the remaining life expectancy of the surviving spouse is calculated for each distribution calendar year after the year of the Member’s death using the surviving spouse’s age as of the spouse’s birthday in that year. For distribution calendar years after the year of the surviving spouse’s death, the remaining life expectancy of the surviving spouse is calculated using the age of the surviving spouse as of the spouse’s birthday in the calendar year of the spouse’s death, reduced by one for each subsequent calendar year.

     (3) If the Member’s surviving spouse is not the Member’s sole designated beneficiary, the designated beneficiary’s remaining life expectancy is calculated using the age of the beneficiary in the year following the year of the Member’s death, reduced by one for each subsequent year.

If the Member dies on or after the date distributions begin and there is no designated beneficiary as of September 30 of the year after the year of the Member’s death, the minimum amount that will be distributed for each distribution calendar year after the year of the Member’s death is the quotient obtained by dividing the Member’s account balance by the Member’s remaining life expectancy calculated using the age of the Member in the year of death, reduced by one for each subsequent year.

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     (e) If the Member dies before the date distributions begin and there is a designated beneficiary, the minimum amount that will be distributed for each distribution calendar year after the year of the Member’s death is the quotient obtained by dividing the Member’s account balance by the remaining life expectancy of the Member’s designated beneficiary, determined as provided in subsection (d). If the Member dies before the date distributions begin and there is no designated beneficiary as of September 30 of the year following the year of the Member’s death, distribution of the Member’s entire interest will be completed by December 31 of the calendar year containing the fifth anniversary of the Member’s death. If the Member dies before the date distributions begin, the Member’s surviving spouse is the Member’s sole designated beneficiary, and the surviving spouse dies before distributions are required to begin to the surviving spouse under subsection (a)(1), this Section will apply as if the surviving spouse were the Member.

     (f) The following definitions shall apply for purposes of this Section:

     (1) Designated beneficiary shall mean the individual who is designated as the beneficiary under the terms of the Plan and is the designated beneficiary under Code Section 401(a)(9) and section 1.401(a)(9)-1, Q&A-4 of the Treasury regulations.

     (2) A distribution calendar year is a calendar year for which a minimum distribution is required. For distributions beginning before the Member’s death, the first distribution calendar year is the calendar year immediately preceding the calendar year which contains the Member’s Required Beginning Date. For distributions beginning after the Member’s death, the first distribution calendar year is the calendar year in which distributions are required to begin under subsection (a). The required minimum distribution for the Member’s first distribution calendar year will be made on or before the Member’s Required Beginning Date. The required minimum distribution for other distribution calendar years, including the required minimum distribution for the distribution calendar year in which the Member’s Required Beginning Date occurs, will be made on or before December 31 of that distribution calendar year.

     (3) Life expectancy means an individual’s life expectancy as computed by use of the Single Life Table in section 1.401(a)(9)-9 of the Treasury regulations.

     (4) The Member’s account balance is the account balance as of the last valuation date in the calendar year immediately preceding the distribution calendar year (valuation calendar year) increased by the amount of any contributions made and allocated or forfeitures allocated to the account balance as of dates in the valuation calendar year after the

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valuation date and decreased by distributions made in the valuation calendar year after the valuation date. The account balance for the valuation calendar year includes any amounts rolled over or transferred to the Plan either in the valuation calendar year or in the distribution calendar year if distributed or transferred in the valuation calendar year.

     (5) Required Beginning Date means the first day of April following the calendar year in which the Member attains age 70¹/2 or, if later, the calendar year in which the Member retires. In the case of a Member who is a “five percent owner” as defined in Section 21.07(f)(3), Required Beginning Date means the first day of April following the calendar year in which the Member attains age 70¹/2.

     10.06 Commencement of Benefit Distribution to Beneficiary. Distributions to the Beneficiary entitled under Section 10.02 to receive any payments payable under this Plan on account of a Member’s death shall be made in a lump sum payment not later than December 31 of the calendar year following the calendar year in which the Member died.

     10.07 Commencement of Benefit Distribution to Alternate Payee. Distributions to an alternate payee entitled under Section 16.01 to receive any payments payable under this Plan pursuant to the terms of a Qualified Domestic Relations Order shall be made in accordance with the terms of such Qualified Domestic Relations Order and this Plan on or after the date on which the Member has attained his “earliest retirement age” (as defined under ERISA Section 206(d)(3)) under the Plan. Notwithstanding the foregoing, distribution to an alternate payee may be made prior to the Member’s attainment of his earliest retirement age if, but only if: (1) the Qualified Domestic Relations Order specifies distribution at that time or permits an agreement between the Plan and the alternate payee to authorize an earlier distribution; (2) the distribution is a single sum distribution of the alternate payee’s entire benefit entitlement under the Plan; and (3) in the event the present value of the alternate payee’s benefits under the Plan exceeds $5,000, the alternate payee consents to any distribution occurring prior to the Member’s attainment of earliest retirement age.

     Nothing in this Section 10.07 shall be construed to permit a Member to (1) receive a distribution at a time not otherwise permitted under the Plan, (2) permit the alternate payee to receive a form of payment not otherwise permitted under the Plan, or (3) cause his Plan accounts to be valued or otherwise determined in a manner not otherwise permitted under the Plan.

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SECTION 11

Permitted Rollover of Plan Distributions

     11.01 Rollover Amount to Other Plans. Notwithstanding any provision of the Plan to the contrary that would otherwise limit a distributee’s election under this Section, a distributee may elect, at the time and pursuant to procedures prescribed by the Committee, to have his entire Plan distribution paid directly to a qualified retirement plan described in the PR Code Section 1165(a) or to an individual retirement account as described in PR Code Section 1165(b)(2) specified by him.

     11.02 Rollover Amount from Other Plans. An Associate eligible to participate in the Plan, regardless of whether he has satisfied the participation requirements of Section 2.01, may transfer to the Plan an Eligible Rollover Distribution provided that such distribution is from an Eligible Retirement Plan. If such transfer is not a direct transfer, such a transfer may be made only if the following conditions are met:

          (a) the transfer occurs on or before the 60^th day following the Associate’s receipt of the distribution from the Eligible Retirement Plan; and

          (b) the amount transferred is equal to any portion of the distribution the Associate received from the Eligible Retirement Plan, not in excess of the fair market value of all property received in such a distribution reduced by employee contributions, as defined in US Code Section 402 (a)(5)(E).

The Committee shall develop such procedures, and may require such information, from a Member desiring to make such a transfer, as it deems necessary or desirable to determine that the proposed transfer will meet the requirements of the Section. Upon approval by the Committee or its Administrative Delegate, the amount transferred shall be deposited in the Trust Fund and shall be credited to the Member’s account. Such rollover amount shall be one hundred percent (100%) vested in the Member, shall share in the income allocations in accordance with Section 5, but shall not share in the Company Profit Sharing Contributions, the Company Matching Contributions or the forfeiture allocations. Upon termination of employment, the total amount of the rollover contribution shall be distributed in accordance with the terms of the Plan.

Upon such a transfer by an Associate who is otherwise eligible to participate in the Plan but who has not yet completed the participation requirements of Section 2.01, his rollover amount shall represent his sole interest in the Plan until he becomes a Member.

     11.03 Definitions. The following definitions shall apply for the purposes of this Section 11:

(a) Eligible Rollover Distribution. An eligible rollover distribution is any distribution of all or any portion of the balance of the credit of the distributee as defined in Code Section 402(c), except that an eligible rollover distribution does not include: any distribution that is one of a series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy)

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of the distributee or the joint lives (or joint life expectancies) of the distributee and the distributee’s beneficiary or for a specified period of ten years or more; any distribution to the extent such distribution is required under Code Section 401(a)(9); and the portion of any distribution that is not includable in gross income (determined without regard to the exclusion for net unrealized appreciation with respect to employer securities).

(b) Eligible Retirement Plan. An eligible retirement plan is an individual retirement account described in Code Section 408, an individual retirement annuity described in Code Section 401(b), an annuity plan described in Code Section 403(a), or a qualified trust described in Code Section 401(a), which accepts or will make, as applicable, an Eligible Rollover Distribution. However, in the case of an Eligible Rollover Distribution to a Member’s surviving spouse, an eligible retirement plan is an individual retirement account or individual retirement annuity.

(c) Distributee. A distributee includes a Member or former Member. In addition, the Member or former Member’s surviving spouse and the Member’s or former Member’s spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in Code Section 414(p), are distributees with regard to the interest of the spouse or former spouse.

(d) Direct Transfer. A direct rollover is a payment by the Plan to the eligible retirement plan specified by the distributee as described in US Code Section 401(a)(31).

SECTION 12

Loans

     12.01 Availability of Loans. Loans shall be permitted under this Plan as established by the policy of the Committee. Any such loan shall be subject to such conditions and limitations as the Committee deems necessary for administrative convenience and to preserve the tax-qualified status of the Plan.

     12.02 Amounts of Loans. No loan to any Member or Beneficiary may be made to the extent that such loan, when added to the outstanding balance of all other loans to the Member or Beneficiary, would exceed the lesser of (a) $50,000 reduced by the excess (if any) of the highest outstanding balance of loans during the one-year period ending on the day before the loan is made, over the outstanding balance of loans from the Plan on the date the loan is made, or (b) one-half the present value of the nonforfeitable accrued benefit of the Member. For the purpose of the above limitation, all loans from all plans of the Employer and other member of a group of employers described in US Code Sections 414(b), 414(c), 414(m), and 414(o) are aggregated. Furthermore, any loan shall by its terms require that repayment (principal and interest) be amortized in level payments, not

40

less frequently than quarterly, over a period not extending beyond five years from the date of the loan. If such loan is used to acquire a dwelling unit which within a reasonable time (determined at the time the loan is made) will be used as the principal residence of the Member, the repayment period shall not extend beyond twenty nine and one-half years from the date of the loan. An assignment or pledge of any portion of the Member’s interest in the Plan and a loan, pledge, or assignment with respect to any insurance contract purchased under the Plan, will be treated as a loan under this paragraph.

     12.03 Terms of Loans.

          (a) Loans shall be made available to all Members and Beneficiaries on a reasonably equivalent basis.

          (b) Loans shall not be made available to Highly Compensated Employees (as defined in US Code Section 414(q)) in an amount greater than the amount made available to other Employees.

          (c) Loans must be adequately secured using not more than fifty percent (50%) of the Member’s Vested Account balance, and bear a reasonable interest rate as determined from time to time by the Committee.

          (d) A Member loan for less than $1,000 is not permitted; provided, however, that if such Member also receives a loan from the Payless ShoeSource, Inc. 401(k) Profit Sharing Plan, such minimum amount limitation shall not apply.

          (e) In the event of default, foreclosure on the note and attachment of security will not occur until a distributable event occurs in the Plan.

          (f) No loans will be made to any Member who on any day during the Company’s applicable fiscal year is a beneficial owner of more than five percent (5%) of the outstanding stock of the Company.

          (g) All loans shall be made pursuant to a written Member loan program incorporated herein by reference.

          (h) Loans are available from the following accounts, and will be withdrawn from the Member’s accounts in the following hierarchy:

(1) Member Accounts

(2) Vested Company Accounts

(3) Member Rollover Contribution

          (i) Loans will be taken and repaid from and to the Investment Funds on a pro rata basis, except in the case the Member is subject to Section 16 of the Securities Exchange Act of 1934 or has been designated as a “Designated Insider,” in which case

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such Member’s loan will be taken first from such Member’s Investment Funds other than the Payless Common Stock Fund.

SECTION 13

Limit on Contributions to the Plan

     This Section 13 is intended to conform the Plan to the requirements of US Code Section 415 and limits the contributions that can be made by and for an individual under the Plan.

     13.01 Limit on Contributions. Notwithstanding any provision of the Plan to the contrary:

(a) The amounts allocated to a Participant during the Limitation Year under the Plan and allocated to the Participant under any other defined contribution plan to which the Employer or any other member of the Group has contributed shall be proportionately reduced, to the extent necessary, so that the Annual Addition does not exceed the least of:

     (1) $30,000; or

     (2) 25% of the Participant’s remuneration from the Employer or any member of the Group during the Limitation Year; or

     (3) such other limits set forth in US Code Section 415.

The amount set forth in subparagraph (1) above shall automatically be adjusted to reflect adjustments made by applicable law. Remuneration for purposes of this Section means remuneration as defined in US Treasury Regulation Section 1.415-2(d) and shall also include the deferrals described in US Code Section 415(c)(3)(D).

     (b) For purposes of this Section, Limitation Year means the 12 month period commencing on January 1 and ending on December 31.

     (c) For purposes of this Section, Annual Additions means the sum for the Limitation Year of Employer contributions, Employee contributions (determined without regard to any rollover contributions as defined in US Code Sections 402(a)(5), 403(a)(4), 403(b)(8) and 408(d)(3) and without regard to Employee contributions to a simplified employee pension plan which are excludible from gross income under US Code Section 408(k)(6)) and forfeitures.

     13.02 Adjustment for Excessive Annual Additions

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          (a) If, as a result of the allocation of forfeitures, a reasonable error in estimating a Member’s Pay or other facts and circumstances to which US Treasury Regulation Section 1.415-6(b)(6) shall be applicable, the “annual additions” under this Plan would cause the maximum “annual additions” to be exceeded for any Member, the Committee shall (1) return any Member Contributions credited for the “limitation year” to the extent that the return would reduce the “excess amount” in the Member’s Accounts, (2) hold any “excess amount” remaining after the return of any Member Contributions in a “Section 415 suspense account”, (3) use the “Section 415 suspense account” in the next “limitation year” (and succeeding “limitation years” if necessary) to reduce either Company Contributions for that Member if that Member is covered by the Plan as of the end of the “limitation year” or if such Member is not covered by the Plan at the end of the “limitation year” to reduce Company Contributions for all Members in the Plan, before any Company Contributions or Member Contributions which would constitute “annual additions” are made to the Plan for such “limitation year,” (4) reduce Company Contributions for such “limitation year” by the amount of the “Section 415 suspense account” allocated and reallocated during such “limitation year.” For purposes of (3) above, the Plan may not distribute “excess amounts” to Members or former Members.

          (b) For purposes of this Section, “excess amount” for any Member for a “limitation year” shall mean the excess, if any, of (1) the “annual additions” which would be credited to his account under the terms of the Plan without regard to the limitations of US Code Section 415 over (2) the maximum “annual additions” determined pursuant to Section 13.01(a).

          (c) For purposes of this Section, “Section 415 suspense account” shall mean an unallocated account equal to the sum of “excess amount” for all Members in the Plan during the “limitation year.” The “Section 415 suspense account” shall not share in any earnings or losses of the Trust Fund.

SECTION 14

Administration of the Plan

     14.01 Plan Administrator. The Company shall be the Plan Administrator of the Plan for purposes of ERISA and shall be a “named fiduciary” as determined in ERISA Section 402(a)(2).

     14.02 Delegation of Authority.

          (a) Authority to administer the Plan has been delegated to the Committee and the Administrative Subcommittee, if any, in accordance with Sections 1.43 (Total and Permanent Disability), 4.01 (Member Contributions), 6.01 (Member Accounts), 6.02 (Company Accounts), 6.05 (Member Statements), 8.02 (Authorized

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Withdrawals), 13.02 (Adjustment for Excessive Annual Additions), 20.02 (Withdrawal of an Employer) and this Section 14.

          (b) Authority with respect to the Investment Funds of the Plan has been delegated to the Trustee in accordance with Sections 5.01(c) (Investment Funds), 6.06 (shares of Payless ShoeSource, Inc. (“Payless Stock”) in the Payless Common Stock Fund), 7.01 (Administrative Expenses) and 15 (Management of the Trust Fund).

          (c) Authority to direct the investment of the Plan’s funds has been delegated to the Investment Subcommittee, if any, in accordance with Section 15.03(b), (c) and (d) (Investments and Reinvestments).

          (d) The Committee shall also have the authority and discretion to engage on Administrative Delegate who shall perform, without discretionary authority or control, administrative functions within the frame work of policies, interpretations, rules practices and procedures made by the Committee or other Plan Fiduciary. Any action made or taken by the Administrative Delegate may be appealed by an affected Member to the Committee in accordance with the claims review procedure in Section 16.05. Any decisions which call for interpretations of the Plan provisions not previously made by the Committee shall be made only by the Committee. The Administrative Delegate shall not be considered a fiduciary with respect to the services it provides.

     14.03 Committee and Subcommittees.

          (a) The Committee may appoint two subcommittees (an Administrative Subcommittee” and an “Investment Subcommittee”), each Subcommittee to consist of at least three persons, who need not be members of the Board. The Committee and each Subcommittee, if appointed, shall elect from its members a Chairman and a Secretary, and may appoint one or more Assistant Secretaries who may, but need not be, members of the Committee or such Subcommittee, and may employ such agents, such legal counsel and such clerical, medical, accounting, actuarial and other services as it may from time to time deem advisable to assist in the administration of the Plan. The Committee and each Subcommittee may, from time to time, appoint agents and delegate to such agents such duties as it considers appropriate and to the extent that such duties have been so delegated, the agent shall be exclusively responsible for the proper discharge of such duties.

          (b) The Administrative Subcommittee shall have the general responsibility for the administration of the Plan and the carrying out of its provisions, and shall have general powers with respect to Plan administration, including, but not limited to, the powers listed in this Section 14.03. The Administrative Subcommittee shall have the power to interpret and construe the Plan, the power to establish rules for the administration of the Plan and the transaction of its business, the power to remedy and resolve inconsistencies and omissions, and the power to determine all questions which arise in the administration, interpretation, or application of the Plan, including but not

44

limited to questions regarding the eligibility, status, Account value and any rights of any Member, Beneficiary, and any other person hereunder.

          (c) The Investment Subcommittee shall have the powers provided for in Section 15.03(b).

          (d) The Committee and each Subcommittee shall act by a majority of its members and the action of such majority expressed by a vote at a meeting, or in writing without a meeting, shall constitute the action of the Committee or such Subcommittee. All decisions, determinations, actions or interpretations with respect to the Plan by the Committee or either Subcommittee and the individual committee or subcommittee members shall be in the Committee’s, Subcommittee’s or individual member’s sole discretion. The decision, determination, action or interpretation of the Committee or either Subcommittee and the respective individual members of the Committee or Subcommittee in respect to all matters within the scope of its authority shall be conclusive and binding on all persons. No member of the Committee or either Subcommittee shall have any liability to any person for any action or omission except each for his own individual willful misconduct. If a Subcommittee is not appointed, the Committee shall exercise such Subcommittee’s authority and perform its duties as described herein.

          (e) Nothing in this Section 14 or in any other provision of the Plan shall be deemed to relieve any person who is a fiduciary under the Plan for purposes of ERISA from any responsibility or liability for any responsibility, obligation or duty which Part 4 of Title I of ERISA shall impose upon such person with respect to this Plan.

     14.04 Accounts and Reports. The Committee shall maintain or cause to be maintained accounts reflecting the fiscal transactions of the Plan and shall keep in convenient form such data as may be necessary for the administration of the Plan. The Committee shall prepare annually a report showing in reasonable detail the assets and liabilities of the Plan and setting forth a brief account of the operation of the Plan for the preceding year.

     14.05 Non-Discrimination. Neither the Committee nor either Subcommittee shall exercise its discretion in such a way as to result in discrimination in favor of officers, shareholders or highly compensated employees (within the meaning of US Code Section 414(q)).

SECTION 15

Management of the Trust Fund

     15.01 Use of the Trust Fund. All assets of the Plan shall be held as a Trust Fund in one or more trusts and shall be used to provide the benefits of this Plan. No part of the corpus or income shall be used for, or diverted to, purposes other than for the exclusive

45

benefit of Members and their Beneficiaries under this Plan and administrative expenses of this Plan.

     15.02 Trustees. The Trust Fund may, at the direction of the Company, be divided into one or more separate trusts, each of which may have a separate Trustee appointed from time to time by the Company and subject to removal by the Company. The Trustee or Trustees of each trust shall have complete authority and discretion with respect to the investment and reinvestment of the assets of each trust, subject, however, to (i) the provisions in the Trust Agreements between the Trustee or Trustees and the Company, and (ii) the provisions of this Plan. Any or all of such separate trusts shall be referred to collectively from time to time as the Trust Fund. Any division of the Trust Fund into one or more separate trusts shall be at the direction of the Company.

     15.03 Investments and Reinvestments. The investment and reinvestment of the assets of the Trust Fund shall be in accordance with the following:

          (a) The Company shall have the authority to instruct the Trustee or Trustees to accept and follow the instructions of any designated investment manager (within the meaning of ERISA Section 3(38)) with respect to the investment and reinvestment of the assets in any Investment Funds the Company may designate.

          (b) The Investment Subcommittee shall have the powers, with respect to investment and reinvestment of the assets constituting the Investment Funds, to promulgate limitations, restrictions, rules or guidelines with respect to the investment policies and classes of investments in which the assets of the Funds may be invested or reinvested by the Trustee or Trustees, including any such investments made pursuant to the instructions of any investment manager. In the event an investment manager designated pursuant to Section 15.03(a) resigns or otherwise is unable to act, the Investment Subcommittee shall have such power and authority as otherwise would be exercisable by such Investment Manager.

          (c) In the event that the assets of the Trust Fund shall be divided into one or more separate trusts pursuant to the authority provided for in Section 15.02, then the powers of the Investment Subcommittee as provided for in Section 15.03(b) may be exercised with respect to one or more of such trusts within the discretion of the Investment Subcommittee.

          (d) The powers of the Investment Subcommittee as provided in Section 14.03(b), may be exercised at any time or from time to time by the Investment Subcommittee within the discretion of the Investment Subcommittee and shall be pursuant to a written agreement between the Investment Subcommittee and the Trustee or Trustees or, if an investment manager has been appointed, between the Investment Subcommittee and the investment manager.

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          (e) The Trust Agreement between the Company (and/or the Employer) and the Trustee or Trustees implementing the Plan shall contain provisions effectuating the provisions of this Section 15 of the Plan.

SECTION 16

Certain Rights and Obligations of Employers and Members

     16.01 Disclaimer of Employer Liability.

          (a) No liability shall attach to the Company or any Employer with respect to a benefit or claim hereunder and Members and their Beneficiaries, and all persons claiming under or through them, shall have recourse only to the Trust Fund for payment of any benefit hereunder.

          (b) The rights of the Members, their Beneficiaries and other persons are hereby expressly limited and shall be only in accordance with the provisions of the Plan. Nothing contained herein shall be deemed to give a Member any interest in any specific property of the Trust or any interest other than a right to receive payments pursuant to the provisions of the Plan.

     16.02 Employer-Associate Relationship. Neither the establishment of this Plan nor its communication through a Summary Plan Description (or otherwise) shall be construed as conferring any legal or other rights upon any Associate or any other person to continue in employment or as interfering with or affecting in any manner the right of the Company or the Employer to discharge any Associate or otherwise act with relation to him. The Company and the Employer may take any action (including discharge) with respect to any Associate or other person and may treat him without regard to the effect which such action or treatment might have upon him as a Member of this Plan.

     16.03 Binding Effect. Each Member, by executing an enrollment form, beneficiary designation and otherwise agreeing to participate in the Plan agrees for himself, his beneficiary(ies), heirs, successors and assigns to be bound by all of the provisions of the Plan.

     16.04 Corporate Action. With respect to any action permitted or required by the Plan, the Company and/or the Employer may act through its appropriate officers:

     16.05 Claim and Appeal Procedure. A Member or beneficiary may file with the Committee or its designee at any time a written claim in connection either with a benefit payable hereunder or otherwise. The Committee or its designee, normally within 90 days after receipt of a written claim, shall render a written decision on the claim, unless an additional 90 days is required by special circumstances which shall be explained to the claimant. If the claim is denied, either in whole or in part, the decision shall include the reason or reasons for the denial; a specific reference to the Plan provision or provisions

47

which are the basis for the denial; a description of any additional material or information necessary for the claimant to perfect the claim; an explanation as to why the information or material is necessary; and an explanation of the Plan’s entire claim procedure. The claimant may file with the Committee, within 60 days after receiving the written decision from the Committee, a written notice of request for review of the Committee’s decision. The review shall be made by a committee of up to three individuals (which may include members of the Committee) appointed by the Company or by the Committee. Said committee shall render a written decision on the claim containing the specific reasons for their decision, including a reference to the Plan’s provisions, normally within 60 days after receipt of the request for review, unless an additional 60 days is required by special circumstances which shall be explained to the claimant. If a Member or beneficiary does not file written notice of a claim with the Committee or its designee at the times set forth above, he shall have waived any right to a benefit other than as originally proposed by the Company or the Committee.

SECTION 17

Non-Alienation of Benefits

     17.01 Provisions With Respect to Assignment and Levy. No benefit payable under this Plan shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, levy or charge, and any attempt so to anticipate, alienate, sell, transfer, assign, encumber, levy upon or charge the same shall be void; nor shall any such benefit be in any manner liable for or subject to the debts, contracts, liabilities, engagements or torts of the person entitled to such benefit, except as specifically provided herein. Notwithstanding the foregoing, the creation, assignment, or recognition of a right to any benefit payable to an alternate payee with respect to a Qualified Domestic Relations Order shall not be treated as an assignment or alienation prohibited by this Section. Any other provision of the Plan to the contrary notwithstanding, if a Qualified Domestic Relations order requires the distribution of all or part of a Member’s benefits under the Plan, the establishment or acknowledgment of the alternate payee’s right to benefits under the Plan in accordance with the terms of such Qualified Domestic Relations Order shall in all events be deemed to be consistent with the terms of the Plan.

          Notwithstanding the above a Member’s benefit will be offset against any amount he or she is ordered or required to pay to the Plan pursuant to an order or requirement which arises under a judgment of conviction for a crime involving the Plan, under a civil judgment entered by a court in an action involving a fiduciary breach, or pursuant to a settlement agreement between the Participant and the Department of Labor or the Pension Benefit Guaranty Corporation. Any such offset shall be made pursuant to Section 206(d) of ERISA.

     17.02 Alternate Application. If a Member or Beneficiary under this Plan becomes bankrupt or attempts to anticipate, alienate, sell, transfer, assign, pledge, encumber or charge any benefit under this Plan, except as specifically provided herein, or

48

if any benefit shall, in the discretion of the Committee, cease, and in that event the Committee may hold or apply the same or any part thereof to or for the benefit of such Member or Beneficiary, his spouse, children or other dependents, or any of them, or in such other manner and in such proportion as the Committee may deem proper.

SECTION 18

Amendments

     18.01 Company’s Rights. The Company reserves the right at any time and from time to time in its sole discretion to alter, amend, or modify, in whole or in part, any or all of the provisions of this Plan, provided, however, no such alteration, amendment or modification shall be made which shall decrease the accrued benefit of any Member. Anything in this Plan to the contrary notwithstanding, the Company in its sole discretion may make any modifications or amendments, additions or deletions in or to this Plan as to benefits or otherwise and retroactively if necessary, and regardless of the effect thereof on the rights of any particular Member or Beneficiary, which it deems appropriate and/or necessary in order to comply with or satisfy any conditions of any law or regulation relating to the qualification of this Plan and the trust or trusts created pursuant hereto and to keep this Plan and said trusts qualified under US Code Section 401(a) and the applicable PR Code section(s) and to have the trust or trusts declared exempt from taxation under US Code Section 501(a) and the applicable PR Code section(s).

     18.02 Procedure to Amend. This Plan may be amended by action of the Company’s Board of Directors and evidenced by a written amendment signed by the Company’s Secretary or by any other person so authorized by or pursuant to authority of the Board of Directors.

     18.03 Provision Against Diversion. No part of the assets of the Trust Fund shall, by reason of any modification or amendment or otherwise, be used for, or diverted to, purposes other than for the exclusive benefit of Members and their Beneficiaries under this Plan and administrative expenses of this Plan.

SECTION 19

Termination

     19.01 Right to Terminate. The Company reserves the right to terminate this Plan, in whole or in part, at any time and, if this Plan shall be terminated, the provisions of Section 19.03 shall apply and the Accounts of affected Members shall become (or remain) fully vested and nonforfeitable.

     19.02 Withdrawal of an Employer. If an Employer shall cease to be a participating Employer in this Plan, the Trust Fund and the Accounts of the Members of the withdrawing Employer and their Beneficiaries shall be revalued as if such withdrawal

49

date were a Valuation Date. The Committee shall then direct the Trustee either to distribute the Accounts of the Members of the withdrawing Employer as of the date of such withdrawal on the same basis as if the Plan had been terminated pursuant to Section 19.03 or to deposit in a trust established by the withdrawing Employer pursuant to a plan substantially similar to this Plan assets equal in value to the assets of the Trust Fund allocable to the Accounts of the Members of the withdrawing Employer.

     19.03 Distribution in Event of Termination of Trust. If this Plan is terminated at any time including a partial termination as defined in US Code Section 411(d)(3), or if contributions are completely discontinued and the Company determines that the trust shall be terminated, in whole or in part, the Trust Fund and all Accounts shall be revalued as if the termination date were a Valuation Date and the affected Members’ Accounts shall be distributed in accordance with Section 10.

     19.04 Administration in Event of Continuance of Trust. If this Plan shall be terminated in whole or in part or contributions completely discontinued but the Company determines that the trust shall be continued pursuant to the terms of the Trust Agreement, the trust shall continue to be administered as though the Plan were otherwise in effect. Upon the subsequent termination of the trust, in whole or in part, the provisions of Section 19.03 shall apply.

     19.05 Merger, Consolidation or Transfer. In the case of any merger or consolidation with, or transfer of Plan assets or liabilities to, any other plan each Member shall be entitled to receive a benefit immediately after the merger, consolidation or transfer (if the transferee plan then terminated) which is equal to or greater than the benefit he would have been entitled to receive immediately before the merger, consolidation or transfer (if the Plan had then terminated).

SECTION 20

Construction

     20.01 Applicable Law. The provisions of this Plan except as otherwise governed by ERISA shall be construed, regulated, administered and enforced according to the laws of Puerto Rico and, whenever possible, to be in conformity with the applicable requirements of ERISA, of the US Code to the extent applicable and of the PR Code of 1994.

     20.02 Gender and Number. Wherever applicable, the masculine pronoun as used herein shall include the feminine pronoun and the singular pronoun shall include the plural.

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     IN WITNESS WHEREOF, the Company has caused this amended and restated Plan to be executed by a duly authorized officer effective January 1, 2007.

PAYLESS SHOESOURCE, INC.
 

By:  

PAYLESS SHOESOURCE OF
PUERTO RICO, INC.
 

By:  

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EX-4.4

Exhibit 4.4

AMENDMENT TO THE
COLLECTIVE BRANDS PUERTO RICO PROFIT SHARING PLAN

               WHEREAS, Collective Brands, Inc. and certain of its subsidiaries (the “Company”) previously adopted the Collective Brands Puerto Rico Profit Sharing Plan (the “Plan”); and

               WHEREAS, the Company reserved the right to amend the Plan pursuant to Section 18.01 thereof; and

               WHEREAS, effective August 15, 2011, the Company desires to amend the Plan to change the eligibility requirements to participate, change the definition of vesting service, permit the Plan Administrator to limit future contributions a Member may invest into the Company Stock Fund and;

               NOW, THEREFORE, effective as of August 15, 2011 or as soon thereafter as administratively feasible, the Plan is amended as following:

     1. Section 1.11 is amended as follows:

     Committee means the Collective Brands Retirement and Investment Committee comprised of three or more members as determined and appointed from time to time by the Board.

     2. Section 1.12 is amended as follows:

     Company means Collective Brands, Inc., a Delaware corporation, and any other organization which may be a successor to it.

     3. Section 1.25 is amended as follows:

     Member means any person included in the membership of this Plan as provided in Section 2. A person shall cease to be a Member when he

(i)	has ceased to be employed by the Employer, and
(ii)	has no undistributed account balances under the Plan.

     4. Section 1.52 is amended as follows:

               Vesting Service for purposes of determining a Member’s vested interest under Section 6.07, prior to January 1, 2012, is based on “elapsed time” and is to be determined in accordance with the following definitions:

               (a) “Employment Commencement Date” means the date upon which an Associate first performs an Hour of Service.

               (b) “Hour of Service” means an hour for which an Associate is paid or entitled to payment for the performance of duties for the Employer or any other member of the Group.

               (c) “Period of Service” means a period beginning on the Associate’s Employment Commencement Date (or Reemployment Commencement Date, as the case may be) and ending on his Severance from Service Date.

               (d) “Severance from Service Date” means the earlier to occur of:

              (i) the last date upon which an Associate terminates employment with the Employer or any other member of the Group (either voluntarily or involuntarily), retires or dies; or

              (ii) the first anniversary of the date upon which the Associate was first absent from service with the Employer (with or without pay) for any other reason (i.e., vacation, sickness, disability, leave of absence or layoff).

Notwithstanding the foregoing, the Severance from Service Date of an Associate who is absent from service with the Employer beyond the first anniversary of the first day of such absence on account of maternity or paternity (as described in ERISA Sections 202(b)(5)(A) or 203(b)(3)(E)) shall be the second anniversary of the first day of such absence; and the period of time between such first and second anniversaries shall not be treated as a Period of Service or as a Period of Severance.

               (e) “Period of Severance” means a period beginning on an Associate’s Severance from Service Date and ending upon the Associate’s Reemployment Commencement Date.

               (f) “Reemployment Commencement Date” means the first date, following a Severance from Service Date, upon which the Associate performs an Hour of Service for the Employer or any other member of the Group.

               (g) “Service Spanning Rules” In determining whether or not an Associate has completed a twelve month Period of Service for purposes of vesting, the following Periods of Severance shall be treated as Periods of Service:

              (i) If an Associate terminates employment with the Employer (either voluntarily or involuntarily) or retires, and then performs an Hour of Service within the twelve month period beginning on the Severance from Service Date, such Period of Severance shall be treated as a Period of Service; and

              (ii) If an Associate terminates employment with the Employer (either voluntarily or involuntarily) or retires during an absence from service of twelve months or less for any reason other than a termination or retirement, and then performs an Hour of Service within a period of twelve months from the date

       the Employee was first absent from service, the Period of Severance shall be treated as a Period of Service.

          Effective with respect to each Associate who performs a Hour of Service on or after January 1, 2012, subject to Section 6.07(c), an Associate shall accrue one year of Vesting Service for each Plan Year on or after January 1, 2012, during which he completes 1,000 Hours of Service.

     5. Section 2.01 is amended as follows:

(a) Each Associate who on August 14, 2011 was a Member of or is eligible to be a Member of the Plan shall continue to be a Member of this Plan entitled to make Member Contributions pursuant to Section 4 and eligible to share in Company Contributions pursuant to Section 3.

(b) On or after August 15, 2011, each other Associate shall be eligible to become a Member of the Plan when the Associate attains age 21 and meets such other eligibility criteria for Part-Time and Full-Time Associates set forth below. Once determined eligible, membership commences as of the first day of the month coincident with or following the date the Associate has met the applicable eligibility requirements. Such Associate shall be eligible:

(i)	to make Member Contributions pursuant to Section 4;
(ii)	to share in Company Matching Contributions pursuant to Section 3.02;
(iii)	to share in Company Profit Sharing Contributions, if any, pursuant to Section 3.01.

Effective August 15, 2011, a Full-Time Associate or Part-Time Associate shall be eligible to make Member Contributions pursuant to Section 4 as of the first day of the month coincident with or following the date he becomes an Associate and has attained age 21. In addition, a Full-Time Associate or Part-Time Associate shall be eligible to receive a Company Matching Contribution if he satisfies the requirements of Section 3.03.

Notwithstanding the foregoing, effective January 1, 2006, a Full Time Associate shall be eligible to make Member Contributions pursuant to Section 4 as of the first day of the month coincident with or following the date he has completed 60 days of employment with the Employer and attained age 21. Further, a Full-Time Associate shall be eligible to receive a Company Matching Contribution coincident with or following the date he has completed 180 days of service with the Company and satisfied the requirements of Section 3.03. For the purpose of the preceding sentence, a “Full Time Associate” is an Associate classified on the Employer’s records as a Full Time Associate. In many locations, this means the Associate is normally scheduled to work 32 or more hours per week. However, the Associate’s classification on the Employer’s records, and not the actual number of hours worked in any period, determines Full Time status. Effective January 1, 2007, a Part Time Associate shall be eligible to make Member contributions pursuant to Section 4 as of the first day of the month coincident with or following the

date he has completed one full year of employment. Prior to the effective date of January 1, 2007, Part Time Associates must have completed one full Year of Service to be eligible to make Member Contributions. Part Time Associates must complete one full year of employment and satisfy the requirements under Section 3.03 to be eligible to receive a Company Matching Contribution.

               (c) Each Member shall be deemed to have elected to make a three percent (3%) Before-Tax Contribution pursuant to Section 4.01(b), commencing with the paycheck issued with respect to the first payroll period beginning on or after the first day of the month coincident with or following the date he met the foregoing eligibility requirements and, effective August 15, 2011, the date he has completed 180 days of such employment and attained age 21. Notwithstanding this “deemed” election, an Associate or Member may elect pursuant to procedures established by the Committee to not make, or to suspend making, said three percent (3%) automatic Before-Tax Contribution, or pursuant to Section 4.01(a) or (b) to make an After-Tax or a Before-Tax Contribution of an amount other than three percent (3%).

               (d) Only Associates employed by the Company’s Puerto Rican subsidiaries are eligible for membership hereunder. Any other Associate who has Accounts in this Plan, such Accounts shall continue to be revalued as of each succeeding Valuation Date pursuant to Section 6.04.

6. Section 3.02 is amended as follows:

Amount of Company Matching Contribution. The Company shall, in its sole and absolute discretion, contribute to the Trust, as of the end of each Plan year, a total combined amount as to this Plan and the Collective Brands 401(k) Profit Sharing Plan equaling up to 2 ¹/2 % of its Net Profits, in the form of a Company Matching Contribution. Such Company Matching Contribution may be made by an Employer, rather than by the Company, as to that Employer’s participating Associates. The total amount of such contribution shall be allocated in proportion to the amount that each member’s Contributions under Sections 4.01(a) and 4.01(b) for such Plan Year, up to a total of 5% of such Member’s Pay for such Plan Year, bears to the total amount of all Member Contributions up to 5% of such Member’s Pay for such Plan Year. Such Company Matching Contribution shall be determined and paid to the Trustee as soon as practicable after the close of each Fiscal Year. Notwithstanding any of the above, for Plan Year 2009, and pursuant to Section 3.03 below, any Member whose employment terminates during the period beginning on January 1, 2009 and ending on February 25, 2009 during the 2009 Plan Year by reason of Retirement, death or Disability, shall be entitled to a minimum guaranteed Company Matching Contribution of $.25 per $1.00 of Member Contributions up to 5% of Pay in accordance with the Plan terms then in effect.

7. Amend Section 4.01(a) as follows:

After-Tax Contributions. Subject to any limitations set forth in the PR Code from time to time, each Member may designate, pursuant to procedures established by the

Company, and contribute to the Plan an amount equal to not less than 1% nor more than 15% (in whole percentage points) of his Pay as he shall have designated pursuant to procedures established by the Company (which may establish lower permissible After-Tax Contributions for Highly Compensated Employees); provided, however, that any Before-Tax Contributions made on behalf of the Member shall reduce by the percentage which he elects to have contributed pursuant to Section 4.01(b)(i), the percentage of Pay that the Member may contribute pursuant to this Section 4.01(a). Notwithstanding any provision in the Plan to the contrary, in no event may After-Tax Contributions exceed 10% of the Members accumulated Pay since he or she became a Member in the Plan without taking into consideration any Member’s After-Tax Contribution subject to Company Matching Contributions.

8. Amend Section 4.01(b)(ii) as follows:

Pursuant to Section 2.01(c), each eligible Member who has satisfied the requirements of such section shall be deemed to have elected to make a three percent (3%) Before-Tax Contribution, unless the Member elects otherwise in accordance with procedures established by the Committee.

9. Amend Section 5.01(a) as follows:

There shall be established as part of the Trust Fund a reasonable range of investment options. The Committee may from time to time, in its discretion, change, delete or add Investment Funds available within the Trust Fund; provided that unless and until the Plan is amended accordingly, the Plan shall provide a Collective Brands Common Stock Fund as an investment option.

10. Amend Section 5.02 as follows:

               (a) A Member may elect that his Member Contributions for each Payroll period be invested in 1% increments totaling 100% in one or more of the Investment Funds. Such election must be made pursuant to procedures prescribed by the Committee. Such election shall be effective until and unless a Member makes a different election for any period, but only as provided for under Subsection 5.02(b) and Subsection 5.02(c). If the Member fails to file a timely initial investment election, he shall be deemed to have elected to have 100% of his Member Contributions and his Company Profit Sharing Contributions invested in the qualified default investment arrangement as may be determined by the Committee. Until such time as the Committee determines otherwise and so notifies Members, a Member’s share of any Company Contributions, when allocated as of Plan Year-end, shall be invested in the same Investment Funds in the same proportions as the Member has elected in connection with investment of his Member Contributions at the time the Company Contribution is contributed to the Trust. Notwithstanding the preceding, effective September 1, 2011, or as soon thereafter as administratively feasible, the amount of future contributions that a Member may elect pursuant to this Subsection 5.02(a) to be invested in the Collective Brands Common Stock Fund shall be limited to 20% of such contributions.

               (b) A Member may change his election with respect to future Member and Company Contributions effective pursuant to procedures prescribed by the Committee, and may not change his election in any other manner except as provided in Subsections 5.02(a) and 5.02(c).

               (c) Subject to 5.02(a), effective as of the date determined by the Committee and pursuant to procedures prescribed by the Committee, a Member may elect to have any or all of the value in any of the Investment Funds which are credited to his Member and/or Company Accounts transferred and invested in any one or more of the Investment Funds.

               (d) Notwithstanding this Section 5.02, effective March 20, 2000, during the black out period as determined by the Committee and the Trustee established to change to daily valuation or a change in recordkeepers, no investment transfers or changes may be made by a Member unless provided in Section 6.06. Notwithstanding anything to the contrary, no loans, withdrawals or distributions shall be made during any such blackout period except as provided by the Committee.

     11. Amend Section 6.06 as follows:

          Shares of Collective Brands, Inc. (“Collective Brands Stock”) in the Collective Brands Common Stock Fund.

               (a) Each Member (or beneficiary of a deceased Member) who has Accounts invested in the Collective Brands Common Stock Fund shall, as a named fiduciary within the meaning of Section 403(a)(1) of ERISA, have the right to direct the Trustee with respect to the vote of the number of shares of Collective Brands Stock attributable to Units credited to him in the Collective Brands Common Stock Fund as of the latest practicable Valuation Date prior to or contemporaneous with the record date set by the Company for each meeting of shareowners of the Company. For such purpose the Trustee shall furnish to each such Member prior to each such meeting the proxy statement for such meeting, together with a form to be returned to the Trustee on which may be set forth the Member’s instructions as to the manner of voting such shares of stock. Upon receipt of such instructions, the Trustee shall vote such shares in accordance therewith. If Member’s instructions are not received by the Trustee in a timely manner, the Trustee shall vote such Member’s shares in the same proportion as the shares of Common Stock for which instructions were actually received from Members. The Trustee shall not divulge the instructions of any Member.

               (b) Each Member (or beneficiary of a deceased Member) who has Accounts invested in the Collective Brands Common Stock Fund shall, as a named fiduciary within the meaning of Section 403(a)(1) of ERISA, have the right with respect to the number of shares of Collective Brands Stock attributable to Units credited to him in the Collective Brands Common Stock Fund as of the latest practicable Valuation Date, to direct the Trustee in writing as to the manner in which to respond to a tender or

exchange offer with respect to Collective Brands Stock, and the Trustee shall respond in accordance with the instructions so received. The Trustee shall utilize its best efforts to timely distribute or cause to be distributed to each Member such information as will be distributed to shareowners of the Company in connection with any such tender or exchange offer, together with a form requesting instructions on whether or not such shares will be tendered or exchanged. If the Trustee shall not receive timely direction from a Member as to the manner in which to respond to such a tender or exchange offer, the Trustee shall not tender or exchange any shares of Collective Brands Stock with respect to which such Member has the right of direction. Tenders as a result of a self-tender offer by the Company shall continue notwithstanding any investment change blackout. The Trustee shall not divulge the instructions of any member. The proceeds from the tender or exchange of shares attributable to Units in Collective Brands Common Stock Investment Fund accounts of Members shall be transferred to one of the Investment Funds described in Section 5.01 and pursuant to a procedure established by the Committee.

     12. Amend Section 6.07(c) and (d) as follows:

               (c) Determination of Vesting Service. For purposes of determining a Member’s Vested Interest in his Company Contributions Account(s) under subsection (a) above, a Member shall be credited with that number of years of Vesting Service determined by adding together all of the Associate’s Periods of Service, whether or not consecutive, prior to January 1, 2012 plus his years of Vesting Service completed on and after January 1, 2012 determined in accordance with Section 1.52. Notwithstanding the foregoing, Vesting Service shall not include any Period of Service or Hours of Service before the Plan Year in which an Associate attains age eighteen (18). Only whole years of service shall be taken into account for purposes of applying the schedule set forth in subsection (a) above, and, for purposes of determining a Member’s number of whole years of service, non-successive Periods of Service prior to January 1, 2012 must be aggregated, with 365 days of service being deemed to constitute one year. For purposes of determining a Member’s Period of Service, prior to January 1, 2012, the Service Spanning rules described in Section 1.52(g) shall apply.

               (d) Forfeiture Break in Service. For purposes of this Section 6.07, prior to January 1, 2012, a “Break in Service” is a Period of Severance of at least 365 consecutive days. Effective January 1, 2012, a “Break in Service” is a Plan Year in which a person completes 500 or fewer Hours of Service. A “Forfeiture Break in Service” occurs when a Member of former Member incurs 5 consecutive Breaks in Service.

     13. Amend section 10.02 as follows:

Form of Payment. All distributions shall be made in the form of cash, except that distributions form the Collective Brands Common Stock Fund shall be made in the form of full shares of Collective Brands Common Stock, as applicable (with payment in cash for a fraction of a share) or in cash if elected by the Member of Beneficiary. The rights extended to a Member hereunder shall also apply to any Beneficiary or alternate payee of such Member.

     14. Amend section 12.03(i) as follows:

               Loans will be taken and repaid from and to the Investment Funds on a pro rata basis, except in the case the Member is subject to Section 16 of the Securities Exchange Act of 1934 or has been designated as a “Designated Insider,” in which case such Member’s loan will be taken first from such Member’s Investment Funds other than the Collective Brands Common Stock Fund.

     15. Amend Section 14.02(b) as follows:

               (b) Authority with respect to the Investment Funds of the Plan has been delegated to the Trustee in accordance with Sections 5.01(c) (Investment Funds), 6.06 (shares of Collective Brands, Inc. (“Collective Brands Stock”) in the Collective Brands Common Stock Fund), 7.01 (Administrative Expenses) and 15 (Management of the Trust Fund).

          Except to conform to this amendment, no other provision of the Plan, as amended, is made by this amendment.

               IN WITNESS WHEREOF, the Company has executed this amendment as of this _____ day of _____ , 2011.

COLLECTIVE BRANDS, INC.
 

By:  

PAYLESS SHOESOURCE OF
PUERTO RICO, INC.
 

By:  

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in this Post-Effective Amendment No. 1 to Registration Statement No. 333-143699 on Form S-8 of our reports dated March 25, 2011, relating to the financial statements and financial statement schedule of Collective Brands, Inc. and subsidiaries (the “Company”) and the effectiveness of the Company’s internal control over financial reporting, appearing in the Annual Report on Form 10-K of the Company for the year ended January 29, 2011.

/s/ DELOITTE & TOUCHE LLP  

Kansas City, Missouri 

August 31, 2011