8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) August 28, 2008 (August 25, 2008)

DSW Inc.

(Exact name of registrant as specified in its charter)

Ohio	001-32545	31-0746639
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

810 DSW Drive, Columbus, Ohio	43219
(Address of principal executive offices)	(Zip Code)

(614) 237-7100

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

     On August 25, 2008, Retail Ventures, Inc. (“RVI”) and DSW Inc. (“DSW”), entered into a Transfer and Assignment Agreement (“Transfer Agreement”), Amendment No. 1 to Amended and Restated Shared Services Agreement (“Shared Services Amendment”), and Amendment No. 1 to Tax Separation Agreement (“Tax Amendment”; and, collectively with the Transfer Agreement and Shared Services Amendment, the “Agreements”). Each of these Agreements are effective as of March 17, 2008.

     RVI currently owns approximately 63% of DSW’s outstanding common stock.

     Under the terms of these Agreements, DSW will provide shared finance and human resources services to RVI and its subsidiaries, including Filene’s Basement. Previously, RVI provided these shared services to DSW. DSW will charge RVI and Filene’s Basement a fixed amount of $4.55 million for the period beginning March 17, 2008 and ending January 31, 2009 for all of the shared services it provides to RVI and Filene’s Basement (including information technology services which it was previously providing).

     Additionally, DSW will pay RVI a management fee of $3.76 million for certain management and oversight services for the period beginning March 17, 2008 and ending January 31, 2009.

     The foregoing summary is qualified in its entirety by reference to the full and complete terms of the Transfer and Assignment Agreement and Amendment No. 1 to Amended and Restated Shared Services Agreement, and Amendment No. 1 to Tax Separation Agreement, copies of which are attached hereto as Exhibit 10.1, 10.2 and 10.3, respectively, and are hereby incorporated by reference into this Item 1.01.

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

     On August 28, 2008, the Company issued a press release regarding its consolidated financial results for the second quarter ended August 2, 2008. A copy of the press release announcing these financial results is attached as Exhibit 99.1 hereto and incorporated by reference herein.

     Pursuant to General Instruction B.2 of Current Report on Form 8-K, the information in this Item 2.02 is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Furthermore, the information in this Item 2.02 shall not be deemed to be incorporated by reference into the filings of the Company under the Securities Act of 1933, as amended.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

     (d) Exhibits.

Exhibit Number	Description
10.1	Transfer and Assignment Agreement among Retail Ventures, Inc., Retail Ventures Services, Inc., DSW Inc., and Filene’s Basement, Inc., dated as of March 17, 2008
10.2	Amendment No. 1 to Amended and Restated Shared Services Agreement between DSW Inc. and Retail Ventures, Inc., dated as of March 17, 2008
10.3	Amendment No. 1 to Tax Separation Agreement between DSW Inc. and Retail Ventures, Inc., dated as of March 17, 2008
99.1	Press Release dated August 28, 2008

Signature

Pursuant to the requirements of the Securities Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	DSW, Inc.
Date: August 28, 2008	By:	/s/ Douglas J. Probst
	Douglas J. Probst
	Executive Vice President and Chief Financial Officer

EX-10.1

Exhibit 10.1

TRANSFER AND ASSIGNMENT AGREEMENT

          TRANSFER AND ASSIGNMENT AGREEMENT (“Agreement”), dated as of March 17, 2008 (the “Effective Date”), by and among DSW Inc., an Ohio corporation (“Buyer” or “DSW”), and Retail Ventures, Inc., an Ohio corporation (“RVI”), Retail Ventures Services, Inc., an Ohio corporation (“RVSI”) and wholly owned subsidiary of RVI, and Filene’s Basement, Inc., a Delaware corporation (“FB”) and wholly owned subsidiary of RVI (RVI, RVSI, and FB, collectively, “Seller” or “RVI Entities”).

          WHEREAS, Seller currently provides certain services on behalf of or for DSW and its subsidiaries, including (i) General Corporate and Financial Services and (ii) Human Resources Services (collectively, the “Provided Services”), pursuant to an Amended and Restated Shared Services Agreement entered into effective as of October 29, 2006, by and between DSW and RVI (the “Shared Services Agreement”);

          WHEREAS, pursuant to the Shared Services Agreement, Buyer or its wholly owned subsidiary, Brand Technology Services LLC, an Ohio limited liability company (“BTS”), provide certain information technology services to the RVI Entities as well as to Value City Department Stores LLC, an Ohio limited liability company (“VC”) and J.S. Overland, Inc. and Retail Ventures Jewelry, Inc., previously wholly owned by RVI;

          WHEREAS, RVI transferred all of the issued and outstanding units of the membership interests of VC to Value City Holdings, Inc. (“VCHI”) and subsequently sold, as of January 23, 2008, 81% of its ownership in VCHI to VCHI Acquisition Co. (“VCHIA”) (the “VC Sale”);

          WHEREAS, (i) Seller desires to transfer certain assets and contracts related to the Provided Services to Buyer, and Buyer desires to acquire such assets and assume such contracts, (ii) Buyer desires to employ certain employees of Sellers currently engaged in providing the Provided Services, (iii) following the consummation of the transactions contemplated by this Agreement, Buyer desires to provide the Provided Services on behalf of or for the RVI Entities, (iv) Buyer has agreed to provide Transition Services to VCHI and VC as provided in the Purchase Agreement, dated as of January 23, 2008 entered into by and between RVI and VCHIA and (v) Buyer and RVI desire to amend the Shared Services Agreement to reflect the foregoing transactions;

          WHEREAS, capitalized terms used herein without definition have the respective meanings assigned thereto in Section 21;

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

1. ASSIGNMENT OF ASSETS AND CONTRACTS; ASSUMPTION OF LIABILITIES

     1.1. Assignment of Assets and Contracts; Assumption of Liabilities

          (a) (i) On the terms and subject to the conditions herein expressed, Seller agrees to transfer, assign and deliver to Buyer, and Buyer agrees to acquire and accept from Seller, on and as of the Effective Date, all of Seller’s right, title and interest in and to the assets described on Schedule 1.1(a)(i) (the “Acquired Assets”) Buyer shall pay Seller the net book value for the Acquired Assets.

               (ii) On the terms and subject to the conditions herein expressed, Seller agrees to transfer, assign and deliver to Buyer, and Buyer agrees to acquire and accept from Seller, on and as of January 31, 2009, all of Seller’s right, title and interest in and to the assets described on Schedule 1.1(a)(ii) (the “IT Acquired Assets”) Buyer shall pay Seller the net book value for the Acquired Assets as of January 31, 2009.

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

               (i) The debts, liabilities and obligations of Seller to be performed after the Effective Date under the contracts, agreements, arrangements and understandings set forth and described on Schedule 2 (the “Assigned Contracts”), other than in each case debts, liabilities and obligations on account of breaches or violations by Seller that occurred on or prior to the Effective Date).

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

               (iii) The debts, liabilities and obligations incurred after the Effective Date by Buyer with respect to the New Buyer Employees (provided that Buyer shall also assume the liabilities relating to vacation pay accrued prior to the Effective Date as provided in Section 10.1.1(a) below).

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

     1.2. Restricted Contracts

          The parties understand and agree that, without limiting any representation, warranty, condition, covenant or indemnification contained in this Agreement, if, as of the Closing, Seller shall not have effectively obtained any or all consents of any third party(ies) to the assignment of the Assigned Contracts (each a “Restricted Contract”), in respect of which such third party’s consent to assign is required in order to preserve the value of such Restricted Contract for Seller or otherwise, then (a) the assignment by Seller and the assumption by Buyer of such Restricted Contract shall not become effective at Closing or thereafter until Seller shall have obtained the requisite consent to assign (which Seller shall use commercially reasonable efforts to obtain, together with the cooperation of Buyer), (b) such assignment and assumption shall become effective as aforesaid subsequent to Closing pursuant to such documentation as shall be reasonably acceptable to Buyer and Seller, and (c) Seller shall not take nor permit any action which would impair the full force and effect of such Restricted Contract, or otherwise cause or permit the modification, amendment, or termination of such Restricted Contract (except insofar as consented to by Buyer, which consent shall not be unreasonably withheld or delayed) until the effective assignment thereof as aforesaid. The parties understand and agree that Seller, subsequent to the Closing, shall not be entitled to any of the rights and privileges under any Restricted Contract, all of which shall accrue to the benefit of Buyer, and Seller shall be deemed to hold such Restricted Contract in trust for Buyer. To the extent that Buyer is able to receive the economic rights and privileges under any Restricted Contract, Buyer shall be responsible for the liabilities assumed by Buyer pursuant to Section 1.1 arising under such Restricted Contract.

2. REPRESENTATIONS AND WARRANTIES BY RVI ENTITIES

          The RVI Entities, jointly and severally, represent and warrant to Buyer as follows:

     2.1. Organization and Standing

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

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

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

     2.2. Authorization

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

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

     2.3. Conflicts and Consents

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

     2.4 Assets; Contracts and Agreements

          (a) Seller has, and pursuant to this Agreement will convey, transfer and assign to Buyer, good and marketable title to the Acquired Assets and IT Acquired Assets, free and clear of Encumbrances.

          (b) Schedule 2 contains a complete list, as of the date hereof, of each Assigned Contracts. All of the Assigned Contracts are fully and validly executed by one of the RVI Entities and have been executed by the other parties thereto, and all of the Assigned

Contracts are in full force and effect, constitute legal, valid and binding obligations of the respective parties thereto, and are enforceable in accordance with their respective terms. Seller has performed in all material respects all of the obligations required to be performed by it to date under each such Assigned Contract. No event has occurred which, with or without notice or the passage of time or both, constitutes or would constitute a material breach or default by Seller or any other party under any Assigned Contract or permit any other party to accelerate, terminate, cancel or modify such Assigned Contract. There have been no threatened cancellations by any third person of any Assigned Contract.

     2.5 Disclosure

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

3. REPRESENTATIONS AND WARRANTIES BY BUYER

          Buyer represents and warrants to the RVI Entities as follows:

     3.1. Organization and Standing

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

     3.2. Authorization

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

     3.3. Conflicts and Consents

          The execution and delivery of this Agreement and the other Buyer Documents, the fulfillment of and the compliance with the respective terms and provisions of each, and the consummation of the transactions described in each, do not and will not conflict with or violate

any law, ordinance, regulation, order, award, judgment, injunction or decree applicable to Buyer, or conflict with or result in a breach of or constitute a default under any of the terms, conditions or provisions of Buyer’s organizational documents, or any contract, agreement, lease, commitment, or understanding to which Buyer is a party or by which Buyer is bound.

4. COVENANTS OF SELLER

          Seller covenants and agrees with Buyer that Seller will use commercially reasonable efforts to obtain all third party consents required to assign to Buyer the Acquired Assets and Assigned Contracts set forth on Schedule 2.3. Buyer shall cooperate with Seller with respect to obtaining all such third party consents. All costs incurred or relating to the obtaining of all such third party consents or otherwise arising from the assignment of the Acquired Assets and Assigned Contracts shall be considered an expense and treated as a shared expensed pursuant to the terms of the Shared Services Agreement.

5. CONDITIONS PRECEDENT TO BUYER’S OBLIGATION TO CLOSE

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

     5.1. Representations and Covenants

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

     5.2. Consents

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

     5.3. Delivery by the RVI Entities

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

     5.4. Legal Proceedings

          No action or proceeding by or before any governmental authority shall have been instituted or threatened (and not subsequently dismissed, settled or otherwise terminated) that

might restrain, prohibit or invalidate the transactions contemplated by this Agreement or any other Seller Document, other than an action or proceeding instituted or threatened by Buyer or DSW.

6. CONDITIONS PRECEDENT TO SELLER’S OBLIGATION TO CLOSE

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

     6.1. Representations and Covenants

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

     6.2. Delivery by Buyer

          Buyer shall have delivered to the RVI Entities all agreements and instruments required to be delivered to the RVI Entities pursuant to Section 7.3.1.

     6.3. Legal Proceedings

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

7. THE CLOSING

     7.1. Closing

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

     7.2. Delivery by the RVI Entities

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

          7.2.1. Agreements and Instruments

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

               (i) Bill of Sale and the Assumption Agreement; and

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

          7.2.2. Consents

          Copies of all consents listed on Schedule 2.3.

          7.2.3. Amendment No. 1 to Shared Services Agreement

          Executed Amendment No.1 to Shared Services Agreement.

          7.2.4. Release of Encumbrances

          Evidence of release of Encumbrances, if any, in form and substance reasonably acceptable to Buyer.

     7.3. Delivery by Buyer

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

          7.3.1. Agreements and Instruments

          The following agreements and instruments:

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

               (ii) the Assumption Agreement; and

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

8. SURVIVAL; INDEMNIFICATION

     8.1. Survival of RVI Entities’ Representations

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

     8.2. Indemnification by Seller

          Subject to the conditions and provisions of Section 8.5, Seller agrees to indemnify, defend and hold harmless Buyer and its affiliates from and against any and all demands, claims, complaints, actions or causes of action, suits, proceedings, investigations, arbitrations, assessments, losses, damages, liabilities, costs and expenses, including, but not limited to, interest, penalties and reasonable attorneys’ fees and disbursements, asserted against, imposed upon or incurred by Buyer and/or its affiliates, directly or indirectly, by reason of or resulting from (a) any debt, liability or obligation of or claim against Seller (whether absolute, accrued, contingent or otherwise and whether a contractual, tax or any other type of liability or obligation or claim) not expressly assumed by Buyer pursuant to Section 1.1, (b) any misrepresentation or breach of the representations and warranties of the RVI Entities contained in or made pursuant to this Agreement or any other Seller Document, or (c) any noncompliance by the RVI Entities with any covenants, agreements or undertakings of Seller or RVI contained in or made pursuant to this Agreement or any other Seller Document.

     8.3. Survival of Buyer’s Representations

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

     8.4. Indemnification by Buyer

          Subject to the conditions and provisions of Section 8.5, Buyer agrees to indemnify, defend and hold harmless Seller and its affiliates from and against any and all demands, claims, complaints, actions or causes of action, suits, proceedings, investigations, arbitrations, assessments, losses, damages, liabilities, costs and expenses, including, but not limited to, interest, penalties and reasonable attorneys’ fees and disbursements, asserted against, imposed upon or incurred by Seller and/or its affiliates, directly or indirectly, by reason of or resulting from (a) any debt, liability or obligation of or claim against Seller (whether absolute, accrued, contingent or otherwise and whether a contractual, tax or any other type of liability or obligation or claim) expressly assumed by Buyer pursuant to Section 1.1, (b) any misrepresentation or breach of the representations and warranties of Buyer contained in or made pursuant to this Agreement or any other Buyer Document, or (c) any noncompliance by Buyer with any covenants, agreements or undertakings of Buyer contained in or made pursuant to this Agreement or any other Buyer Document.

     8.5. Conditions of Indemnification

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

          (a) The party seeking indemnification (the “Indemnified Party”) must give the other party or parties, as the case may be (the “Indemnifying Party”), notice of any such Claim

promptly after the Indemnified Party receives notice thereof; provided, however, that failure to give such notice promptly shall not relieve the Indemnifying Party of its obligations under this Section 8 except to the extent that the Indemnifying Party is prejudiced thereby.

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

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

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

9. ADDITIONAL COVENANTS OF THE PARTIES

     9.1. Mutual Covenants

          9.1.1. Additional Actions and Documents

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

          9.1.2. Public Announcements

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

     9.2. Covenants of RVI Entities

          9.2.1. Certain Third Party Warranties

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

     9.3 Northland Furniture

          Buyer shall pay to Seller $110,000 as full settlement of its share of the allocated depreciation for the furniture associated with the Northland building (cost center 01109).

10. EMPLOYEES AND EMPLOYEE BENEFITS

     10.1.1. Employment of New Buyer Employees

          (a) As of the Effective Date, the employees listed on Schedule 3 (the “New Buyer Employees”) shall become employees of Buyer. Buyer shall be responsible for the payment of all wages and other remuneration due to New Buyer Employees with respect to their services as employees of Buyer from and after the Effective Date; provided, however that Buyer shall also be responsible for any accrued vacation pay of a New Buyer Employee earned prior to the Effective Date but not payable prior to the Effective Date. Nothing in this Agreement establishes any right in the New Buyer Employees to payments of any kind relating to termination of employment.

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

          (c) Seller or, as applicable, the appropriate employee benefit plans shall be liable for any claims made or incurred by New Buyer Employees and their beneficiaries through the Effective Date under any employee benefit plans in which the New Buyer Employees

participate. For purposes of the immediately preceding sentence, a charge will be deemed incurred, in the case of hospital, medical or dental benefits, when the services that are the subject of the charge are performed and, in the case of other benefits (such as disability or life insurance), when an event has occurred or when a condition has been diagnosed that entitles the employee to the benefit.

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

          (e) Immediately following the transactions contemplated hereby, all reasonable efforts will be made to quickly transition payroll records and systems from Seller to Buyer, so that all applicable payments are made on Buyer’s behalf. 

          10.1.2. Retirement and Welfare Plans

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

          10.1.3. General Employee Provisions

          (a) Buyer will set its own initial terms and conditions of employment for the New Buyer Employees and others it may hire, including work rules, benefits and salary and wage structure, all as permitted by law; provided, however, that Buyer shall not reduce the job title or compensation of any New Buyer Employee for a period of eighteen (18) months from the Effective Date unless such change is related to a request by a New Buyer Employee in job scope/responsibility. Buyer shall provide Seller with advance notice of the termination of employment by Buyer of any New Buyer Employee employed at a director level or higher who provides shared services.

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

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

          (d) With respect to any claims arising based on acts by Seller in the time period prior to the Effective Date, Buyer shall not have any responsibility, liability or obligation, whether to New Buyer Employees, former employees, their beneficiaries or to any other person, with respect to any employee benefit plans, practices, programs or arrangements (including the establishment, operation or termination thereof and the notification and provision of COBRA coverage extension) maintained by Seller.

          10.1.4. Employee Severance Costs

          Except as otherwise expressly set forth herein, Seller and Buyer shall share equally (50/50) with respect to any claim or liability relating to the termination of an employee (not including New Buyer Employees) from any of the RVI Entities as the result of the VC Sale and subsequent transfer of New Buyer Employees to Buyer.

11. SALES, TRANSFER AND OTHER TAXES

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

12. TERMINATION

          The parties may terminate this Agreement by mutual written agreement at any time prior to the Closing. In addition, either Buyer, on the one hand, or Seller and RVI, on the other hand, may terminate this Agreement if the Closing shall not have occurred on or before June 30, 2008. In the event that this Agreement is terminated pursuant to this Section 12, such termination shall be without any liability or obligation to any party or parties and all further obligations of the parties hereunder shall terminate.

13. NOTICES

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

               (i) If to Buyer:

DSW Inc.
810 DSW Drive
Columbus, Ohio 43219
Attn: Chief Financial Officer
Telecopier Number: 614/872-1475

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

DSW Inc.
810 DSW Drive
Columbus, Ohio 43219
Attn: General Counsel
Telecopier Number: 614/872-1475

               (ii) If to Seller or RVI:

Retail Ventures, Inc.
3241 Westerville Road
Columbus, Ohio 43224
Attn: Chief Financial Officer
Telecopier Number: 614/473-2721

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

Retail Ventures, Inc.
3241 Westerville Road
Columbus, Ohio 43224
Attn: General Counsel
Telecopier Number: 614/337-4682

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

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

14. WAIVER

          No delay or failure on the part of any party hereto in exercising any right, power or privilege under this Agreement or under any other instrument or document given in connection with or pursuant to this Agreement shall impair any such right, power or privilege or

be construed as a waiver of any default or any acquiescence therein. No single or partial exercise of any such right, power or privilege shall preclude the further exercise of such right, power or privilege, or the exercise of any other right, power or privilege. No waiver shall be valid against any party hereto unless made in writing and signed by the party against whom enforcement of such waiver is sought and then only to the extent expressly specified therein.

15. BENEFIT AND ASSIGNMENT

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

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

16. REMEDIES CUMULATIVE

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

17. ENTIRE AGREEMENT; AMENDMENT

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

18. SEVERABILITY

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

19. HEADINGS

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

20. GOVERNING LAW

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

21. DEFINITIONS AND REFERENCES

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

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

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

          “Acquired Assets” shall have the meaning set forth in Section 1.1.

          “Assigned Contracts” shall have the meaning set forth in Section 1.1.

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

          “Bill of Sale” shall mean a bill of sale in such form as is mutually agreed upon by the parties to evidence the transfer of the Acquired Assets.

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

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

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

          “Closing” means the closing of the transactions contemplated hereunder.

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

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

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

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

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

          “Restricted Contract” shall have the meaning set forth in Section 1.2.

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

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

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

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

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

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

22. SIGNATURE IN COUNTERPARTS

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

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

DSW INC.
By:	/s/ William L. Jordan
Name: William L. Jordan
Title: Senior Vice President, General Counsel
RETAIL VENTURES, INC.
By:	/s/ James A. McGrady
Name: James A. McGrady
Title: Executive Vice President, Chief Financial Officer
RETAIL VENTURES SERVICES, INC.
By:	/s/ James A. McGrady
Name: James A. McGrady
Title: Executive Vice President, Chief Financial Officer
FILENE’S BASEMENT, INC.
By:	/s/ James A. McGrady
Name: James A. McGrady
Title: Executive Vice President, Chief Financial Officer

EX-10.2

Exhibit 10.2

Execution Copy

AMENDMENT NO. 1
TO
AMENDED AND RESTATED SHARED SERVICES AGREEMENT

     This Amendment No. 1 to Amended and Restated Shared Services Agreement (this “Amendment”) is made and entered into as of March 17, 2008, by and between DSW Inc., an Ohio corporation (“DSW”), and Retail Ventures, Inc., an Ohio corporation (“Retail Ventures”).

Recitals

     WHEREAS, DSW and Retail Ventures entered into an Amended and Restated Shared Services Agreement, dated as of October 29, 2006, relating to their arrangement concerning certain shared services (the “Shared Services Agreement”);

     WHEREAS, Retail Ventures has sold its entire membership interest in Value City Department Stores LLC, an Ohio limited liability company (“Value City”);

     WHEREAS, Retail Ventures, Retail Ventures Services, Inc., an Ohio corporation (“RVSI”) and wholly owned subsidiary of Retail Ventures, Filenes Basement, Inc., a Delaware corporation (“FB”) and wholly owned subsidiary of Retail Ventures (Retail Ventures, RVSI and FB are collectively referred to as the “RVI Entities”), and DSW have entered into a certain Transfer and Assignment Agreement, dated as of March 17, 2008, pursuant to which the RVI Entities transferred certain assets and contracts related to certain shared services including General Corporate and Financial Services and Human Resources Services (the “Transfer and Assignment Agreement”); and

     WHEREAS, the parties desire to amend the Shared Services Agreement as hereinafter set forth.

     NOW, THEREFORE, in consideration of the mutual covenants and agreements described in this Amendment, the parties hereby agree as follows:

Agreement

1. The following definitions shall be added to Article I Definitions of the Shared Services Agreement:

     “General Corporate, Financial and Human Resources Services” means those services referenced on Schedule II that were provided by or on behalf of Retail Ventures before the GCFHR Services Transfer Date and will be provided by DSW after the GCFHR Services Transfer Date.

     “GCFHR Services Transfer Date” shall mean the date that is mutually agreed upon by the Parties for transfer of responsibility for performance of General Corporate, Financial and Human Resources Services from Retail Ventures to DSW.

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2. The definition of “Tax Separation Agreement” in Article I Definitions of the Shared Services Agreement is amended in its entirety to read as follows:

“Tax Separation Agreement” means the Tax Separation Agreement attached as Exhibit A to the Master Separation Agreement, as such Tax Separation Agreement may be amended from time to time by mutual agreement of the parties.

3. Schedules I, II and III to the Shared Services Agreement are hereby replaced in their entirety with the schedules attached to this Amendment.

4. Section 2.02(a) of the Shared Services Agreement shall be amended and restated in its entirety to read as follows:

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

5. Section 3.02 of the Shared Services Agreement shall be amended and restated in its entirety to read as follows:

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

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consistent with the manner in which such costs were increased from time to time prior to the Information Technology Services Transfer Date or the GCFHR Services Transfer Date, as applicable, and consistent with the semi-annual reconciliation described in Section 8.01).

6. Section 3.06(a) of the Shared Services Agreement shall be amended and restated in its entirety to read as follows:

(a) Except as otherwise provided in a Schedule to this Agreement or to the extent that Retail Ventures and DSW may mutually agree, each Billing Party shall invoice or notify the Chief Executive Officer or Chief Financial Officer of the Receiving Party on a monthly basis (not later than the tenth day of each month), in a manner substantially similar to and consistent with the billing practices used in connection with services provided by Retail Ventures to the DSW Entities prior to the Offering Date and, as applicable, the Information Technology Services Transfer Date or the GCFHR Services Transfer Date (except as otherwise agreed), of the Service Costs related to services performed or procured by the Billing Party during the prior calendar month. As used herein, “Service Costs” means the Retail Ventures Service Costs, if Retail Ventures is the Billing Party, and the DSW Service Costs, if DSW is the Billing Party. In connection with the invoicing described in this Section 3.06(a), the Billing Party shall provide to the Receiving Party the same billing data and level of detail as customarily or similar to that provided to the Receiving Party prior to the Offering Date and, as applicable, the Information Technology Services Transfer Date or the GCFHR Services Transfer Date and such other related data as may be reasonably requested by the Receiving Party.

7. Section 4.01(i) of the Shared Services Agreement shall be amended and restated in its entirety to read as follows:

(i) General Standard of Service. Except as otherwise agreed to in writing by the Parties or as described in this Agreement, and provided that a Party is not restricted by contract with third parties or by applicable law, the Parties agree that (i) the nature, quality, and standard of care applicable to the delivery of the Services hereunder (other than the Information Technology Services and the General Corporate, Financial and Human Resources Services) shall be substantially the same as or consistent with that applicable to the similar services provided by a Party to the other Party prior to the Offering Date, (ii) the nature, quality, and standard of care applicable to the delivery of the Information Technology Services hereunder shall be, at a minimum, substantially the same as or consistent with that applicable to the similar services provided by or on behalf of Retail Ventures prior to the Information Technology Services Transfer Date, and (iii) the nature, quality, and standard of care applicable to the delivery of the General Corporate, Financial and Human Resources Services shall be, at a

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minimum, substantially the same as or consistent with that applicable to the similar services provided by or on behalf of Retail Ventures prior to the GCFHR Services Transfer Date. Retail Ventures shall use its reasonable efforts to ensure that the nature and quality of Services provided to DSW associates under Retail Ventures Plans, either by Retail Ventures directly or through administrators under contract, shall be undifferentiated as compared with the same services provided to or on behalf of Retail Ventures associates under Retail Ventures Plans.

8.   Section 9.09(a) is amended to change all references to “4150 East 5^th Avenue” to “810 DSW Drive.”

9.   In the event that an asset impairment occurs to either party or its subsidiaries because of Value City ceasing to conduct business or a reduction in the sales of Value City, the party on whose books the asset (relating to such impairment) resides at the time of such cessation of business or reduction in sales shall be obligated to take the asset impairment and shall not seek reimbursement from the other party for any charges relating to such asset impairment.

10. In the event that Value City ceases to conduct business, the parties agree that they will jointly share the “fixed cost” portion of the shared service fees allocated to Value City for Fiscal Year 2008 in the same proportion as DSW and the RVI Entities share fees for such service. For purposes of this Agreement, fixed costs shall mean the costs required to provide the shared service function regardless of whether Value City is receiving service (i.e.: deprecation expense and personnel expense).

11. Retail Ventures shall be solely responsible for reasonable allocations of costs of the Services to Value City for which Value City is not liable during the first ninety (90) days as the result of contractual terms and limitations contained in the agreement(s) relating to the sale of Value City to Value City Holdings, Inc. / VCHI Acquisition Co. on January 23, 2008. For purposes of this paragraph, “Services” does not include shoe processing.

12. Capitalized terms used in this Amendment and not defined herein shall have the meanings given to them in the Shared Services Agreement.

13. The provisions of this Amendment shall become effective as of the date hereof and this Amendment shall not otherwise affect any obligation or liability of either party under the Shared Services Agreement occurring or accruing prior to the date of this Amendment.

14. Except as expressly amended herein, all terms and provisions of the Shared Services Agreement shall remain unchanged and in full force and effect.

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     IN WITNESS WHEREOF, the parties hereto have executed this Amendment No. 1 to Amended and Restated Shared Services Agreement as of the date set forth above.

DSW INC.		RETAIL VENTURES, INC.
By:	/s/ William L. Jordan	By:	/s/ James A. McGrady
Title: Senior Vice President, General Counsel		Title: Executive Vice President, CFO

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SCHEDULE I

TO
AMENDED AND RESTATED
SHARED SERVICES AGREEMENT
DATED October 29, 2006
BETWEEN
RETAIL VENTURES, INC.
AND
DSW INC.

Revised Effective March 17, 2008

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

DESCRIPTION OF RETAIL VENTURES	RETAIL VENTURES SERVICE COSTS OR
SERVICE	BILLING METHODOLOGY TO DSW
1. IMPORT MANAGEMENT AND COMPLIANCE	Pass-Through Billing with respect to costs directly related to DSW Entities. Importing fees (including U.S. Customs fees, Duties, Commissions, Ocean Freight, Excel/APL Logistic Carrier fees and other associated expense) are allocated to the businesses by invoice (which historically is a one-to-one relationship to container) to the ratio of the container contents to the whole containers/trailer.
	DSW to pay a percentage of the overhead costs based upon percentage of usage. The overhead allocation percentage will be reviewed and determined annually.
2. Management, Oversight and General (includes deprecation of IT assets related to shared service assets purchased by RVI, expenses associated with the Northland facility lease (pursuant to the terms of the Master Separation Agreement between the parties), compliance assistance, legal services, SSC Corporate services expenses, and DSW’s portion of D&O insurance premiuims.)	DSW to pay $358,334 per month during the term of the agreement.

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SCHEDULE II
TO

AMENDED AND RESTATED
SHARED SERVICES AGREEMENT
DATED October 29, 2006
BETWEEN
RETAIL VENTURES, INC.
AND
DSW INC.

Revised Effective March 17, 2008

SERVICES TO BE PROVIDED BY DSW INC.

		DSW SERVICE COSTS
	DSW SERVICE COSTS OR	OR BILLING
DESCRIPTION OF DSW	BILLING METHODOLOGY TO	METHOLOGY TO
SERVICE	RETAIL VENTURES	FILENE’S BASEMENT
1. GENERAL CORPORATE AND FINANCIAL SERVICES
(i) PAYROLL SERVICES (including preparation and distribution of employee checks; payment of payroll taxes, garnishment and other deductions to appropriate parties; preparation and filing of employer tax returns; and preparation of annual W-2s for employees)	RVI to pay $0 per month during the term of the Agreement.	FB to pay $9,417 per month during the term of the Agreement.
(ii) Sox and AUDITING Fees (including coordination of external audit services and assistance with compliance with Sarbanes-Oxley requirements)	RVI to pay 50% of audit fees relating to the shared audit of internal controls.	N/A
(iii) ACCOUNTS PAYABLE, and SALES AUDIT	RVI to pay $5,417 per month during the term of the Agreement.	FB to pay $31,917 per month during the term of the Agreement.
(iv) GENERAL LEDGER AND PREPARATION OF QUARTERLY, ANNUAL AND OTHER SEC REPORTS; ASSISTANCE WITH THE PREPARATION OF ANNUAL REPORT TO SHAREHOLDERS; AND PREPARATION OF ERISA REPORTS.	RVI to pay $29,500 per month during the term of the Agreement.	FB to pay $20,167 per month during the term of the Agreement.

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		DSW SERVICE COSTS
	DSW SERVICE COSTS OR	OR BILLING
DESCRIPTION OF DSW	BILLING METHODOLOGY TO	METHOLOGY TO
SERVICE	RETAIL VENTURES	FILENE’S BASEMENT
(v) TAX SERVICES (including preparation and filing of all federal, state and local tax returns, reports and other required filings; coordination and management of tax audits and other similar proceedings; and assistance with tax planning, tax strategy and compliance with the Tax Separation Agreement)	RVI to pay $3,750 per month during the term of the Agreement.	FB to pay $8,667 per month during the term of the Agreement.
2. HUMAN RESOURCES (ALL COST CENTERS)	When pre-approved by RVI, Pass-Through Billing with respect to costs directly related to RVI Entities. RVI to pay $0 per month during the term of the Agreement for overhead costs.	When pre-approved by FB, Pass-Through Billing with respect to costs directly related to FB. FB to pay $25,583 per month during the term of the Agreement for overhead costs.
3. RISK MANAGEMENT (including management of insurance and workers compensation coverage; administration of claims services; negotiation and acquisition of insurance coverages including, but not limited to, property and business interruption, casualty (including workers compensation), director and officer liability and other liability coverages)	a) Insurance premium costs billed as specified in Schedule III. RVI to pay $0 per month during the term of the Agreement for overhead costs.	a) Insurance premium costs billed as specified in Schedule III. B) FB to pay $6,333 per month during the term of the Agreement for overhead costs.
4. INTERNAL AUDIT	RVI to pay $16,417 per month during the term of the Agreement for overhead costs.Shared Section 404 audit fees from outside auditor to be split 50/50.	FB to pay $24,583 per month during the term of the Agreement for overhead costs.

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		DSW SERVICE COSTS
	DSW SERVICE COSTS OR	OR BILLING
DESCRIPTION OF DSW	BILLING METHODOLOGY TO	METHOLOGY TO
SERVICE	RETAIL VENTURES	FILENE’S BASEMENT
5. INFORMATION TECHNOLOGY (ALL COST CENTERS)	Pass-Through Billing with respect to costs directly related to Retail Ventures Entities (100% allocated cost centers).	Pass-Through Billing with respect to costs directly related to Retail Ventures Entities (100% allocated cost centers).
	RVI to pay $0 per month during the term of the Agreement with respect to overhead, Services and depreciation shared by DSW Entities and Retail Ventures Entities.	FB to pay $246,866 per month during the term of the Agreement with respect to overhead, Services and depreciation shared by DSW Entities and Retail Ventures Entities.
6. Legal Services	When pre-approved by RVI, Pass-Through Billing with respect to costs directly related to RVI Entities.	N/A
Total monthly fixed charges	$55,084	$373,533

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SCHEDULE III

TO
AMENDED AND RESTATED
SHARED SERVICES AGREEMENT
DATED October 29, 2006
BETWEEN
RETAIL VENTURES, INC.
AND
DSW INC.

Amended Effective March 17, 2008

INSURANCE POLICIES MAINTAINED BY RETAIL VENTURES

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

(a)	LIST OF INSURANCE POLICIES
(a)	Liability: Zurich American Insurance Co. #ACO903070302 – primary — $1MM/occurrence (DSW only) Zurich American Insurance Co., #ACO382218606 – primary — $1MM/occurrence (RVI only) National Union Fire Ins. Co., #9835015 – umbrella — $25MM/occ/agg Zurich American Insurance Co.,#AEC508637504 – excess GL — $25MM/occ/agg Lexington Insurance, #1172913 – excess GL — $25MM/occ/agg National Union Fire, #8766505 – excess GL — $25MM/occ/agg Liberty International, #LQ1B7107876407 – excess GL — $50MM/occ/agg Great American Insurance, #TUE 3-57-97-71-06 – excess GL — $25MM/occ/agg National Surety, #SHX-000-90474420 – excess GL — $25MM/occ/agg
(b)	Property: FM Global Insurance, #NC346 — $1,000,000,000 blanket limit FM Global Insurance, #NC346 – earthquake — $5MM agg Arrowhead Group, #309153XF-1 – excess earthquake — $10MM/occ/agg (DSW only) Insurance Company of the West, #XHO216132702 – excess earthquake — $15MM/occ/agg (DSW only) Federal Flood Policies – various locations & policy numbers — $500K
(c)	Automobile Travelers Indemnity Insurance Co., #TC2J-CAP-393K3380 — $2MM CSL
(d)	Cargo Lloyd’s of London, #CC106040Z, $10MM/occ/agg Lloyd’s of London, #MC106070Z, excess cargo, $5MM/occ/agg
(e)	Workers Compensation Travelers Insurance Company, #TC2HUB-466K1644– statutory limits Travelers Insurance Company, #TRJUB-466K1656 – retro AZ, MA & WI

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	Ohio – Self-Insured under S1200005342 Arch Insurance, #11WCX5942600, excess WC over Ohio SI, statutory limits
(f)	Directors and Officers Liability Insurance (DSW only) Federal Insurance Co. (Chubb) #6802-9501 – primary — $10MM XL Specialty Insurance, #ELU106200-08, excess D&O — $10MM Allied World Assurance Co., #C007705/003, excess D&O — $10MM RSUI Indemnity Company, #NHS630008, excess D&O, $10MM AXIS Reinsurance Company, #MAN714919012008, excess D&O — $10MM Travelers Insurance, #ECO6801162, excess D&O, $10MM US Specialty (HCC), #14-MGU-08-A17173, excess D&O — $10MM Great American Insurance, #DFX3911869, excess D&O — $5MM Houston Casualty Insurance, #14MG09A9263, Side A coverage — $15MM (RVI only) Federal Insurance Co. (Chubb) #8169-6117 – primary — $10MM XL Specialty Insurance, #ELU106226-08, excess D&O — $10MM Allied World Assurance (AWAC), #C007628/003, excess D&O — $10MM RSUI Indemnity Company, #NHS630024, excess D&O, $10MM AXIS Reinsurance Company, #MAN714352012008, excess D&O — $10MM Travelers Insurance, #ECO6801163, excess D&O, $10MM US Specialty (HCC), #14-MGU-08-A17183, excess D&O — $10MM Great American Insurance, #DFX0009650, excess D&O — $10MM Liberty Mutual Insurance, #DO3AT361551004, excess D&O — $10MM National Union Fire (AIG), #703-48-31, excess D&O — $10MM XL Specialty Insurance, #14MG-09-A9265, Side A coverage — $15MM
(g)	Executive Protection Insurance National Union Fire, #6790009, crime — $10MM/occ/agg National Union Fire, #647-7736, K&R — $10MM unlimited National Union Fire, #668-72-32, fiduciary — $5MM
(h)	Other AIG Cat Excess, #5348415, excess punitive damages — $25MM/occ/agg Hanseatic Insurance, #HIPD201225, excess punitive damages — $25MM/occ/agg AIG Cat Excess, #5348416, excess punitive damages — $25MM/occ/agg AIG Cat Excess, #5348417, excess punitive damages — $25MM/occ/agg Continental Insurance Co., #PST 28 352 9925, foreign package — $1MM/occ Safeonline, LLC, Binder#9BQKJ , Cyber Risk (first party) — $5MM (DSW only) ACE American Lloyd’s, Binder #9BQKF, Cyber Risk (third party) $5MM (DSW only)

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(b) CALCULATION OF PREMIUM

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

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

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

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

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

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

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

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

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EX-10.3

Exhibit 10.3

Execution Copy

AMENDMENT TO TAX SEPARATION AGREEMENT

     This Amendment to Tax Separation Agreement (this “Amendment”) is made and entered into as of March 17, 2008, by and among Retail Ventures, Inc., an Ohio corporation (“RVI”), each RVI Affiliate (as defined in the Tax Separation Agreement), DSW Inc., an Ohio corporation, and each DSW Affiliate (as defined in the Tax Separation Agreement).

Recitals

     WHEREAS, the parties entered into a certain Tax Separation Agreement, dated as of July 5, 2005, relating to their arrangement concerning certain tax matters and tax and accounting services (the “Tax Separation Agreement”);

     WHEREAS, RVI has sold its entire membership interest in Value City Department Stores LLC, an Ohio limited liability company; and

     WHEREAS, the parties desire to amend the Tax Separation Agreement as hereinafter set forth.

     NOW, THEREFORE, in consideration of the mutual covenants and agreements described in this Amendment, the parties hereby agree as follows:

Agreement

1. The definition of “Shared Services Agreement” in Section 1. Definitions is amended in its entirety to read as follows:

“Shared Services Agreement” means the Shared Services Agreement, dated effective as of January 30, 2005, by and between RVI and DSW, as such Shared Services Agreement may be amended from time to time by mutual agreement of the parties.

2. Section 2.05 is amended in its entirety to read as follows:

2.05. Tax & Accounting Services Agreement.

     (a) In General. DSW shall prepare for RVI any Tax Return described in Section 2.01 of this Agreement and provide other Tax related services to RVI, as set forth on Schedule 2.05(a) attached hereto (the “Tax & Accounting Services”). In consideration for the Tax & Accounting Services, RVI shall (i) pay to DSW its respective share, as provided in the Shared Services Agreement, of any and all costs associated with the maintenance and operation of DSW’s tax department (including any and all overhead expenses) for each month in which the Tax & Accounting Services are to be performed, and (ii) reimburse DSW its respective share, as provided in the Shared Services Agreement, of any and all third party fees and expenses incurred by DSW; provided, however, that, (i) RVI shall reimburse DSW for

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one hundred percent (100%) of any and all third party fees and expenses incurred by DSW solely in connection with the performance of the Tax & Accounting Services, and (ii) RVI shall not be required to reimburse DSW for any portion of any third party fees and expenses incurred by DSW solely for the benefit of DSW or any DSW Affiliate. Payment and reimbursement with respect to Tax & Accounting Services performed in a particular month shall be made within twenty (20) days of the end of such month in immediately available funds as instructed by DSW; provided, however, that, upon termination of the rights and obligations pursuant to this Section 2.05, payment and reimbursement with respect to all Tax & Accounting Services performed through and including the effective date of the termination shall be made at least two (2) days prior to the effective date of the termination. Either party shall have the right to terminate all rights and obligations pursuant to this Section 2.05 effective upon one hundred and eighty (180) days written notice to the other party of its cancellation of the Tax & Accounting Services.

     (b) Right to Review. DSW shall provide RVI with (i) any Income Tax Return to be prepared by DSW for RVI pursuant to the Tax & Accounting Services at least twenty (20) days prior to the due date of such Tax Return or as is otherwise consistent with past practice and (ii) any Non-Income Tax Return to be prepared by DSW for RVI pursuant to the Tax & Accounting Services at least four (4) days prior to the due date of such Tax Return or as is otherwise consistent with past practice. RVI shall have the right to comment on any such Tax Return and DSW shall reasonably consider all comments made by RVI.

     (c) Information. RVI shall timely provide all information reasonably requested by DSW to prepare all Tax Returns, compute all estimated Tax payments (for purposes of Section 7.01 of this Agreement) and perform the Tax & Accounting Services, and all such information shall be provided in a manner reasonably requested by DSW. DSW shall provide RVI with all Tax Returns prepared for RVI pursuant to the Tax & Accounting Services and copies of any notices or communications from any Taxing Authority relating to any Tax or Tax Return of RVI or any RVI Affiliate covered by the Tax & Accounting Services. RVI shall execute and deliver to DSW a power of attorney authorizing the appropriate DSW employees to sign as “paid preparer” any Tax Return prepared by DSW for RVI pursuant to the Tax & Accounting Services.

3. Section 3.05 is amended in its entirety to read as follows:

     3.05. Computation. DSW shall provide RVI with a written calculation in reasonable detail (including copies of all work sheets and other materials used in preparation thereof) setting forth the amount of any DSW Separate Tax Liability or estimated DSW Separate Tax Liability (for purposes of Section 7.01 of this Agreement) and any Taxes related to the DSW Business. RVI shall have the right to review and comment on such calculation. Any dispute with respect to such calculation shall be resolved pursuant to Section 10.03 of this Agreement; provided, however, that, notwithstanding any dispute with respect to any such calculation, in no event shall any payment attributable to the amount of any DSW Separate Tax Liability or estimated DSW Separate Tax Liability be paid later than the date provided in Section 7 of this Agreement.

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4. Section 7.03 is amended in its entirety to read as follows:

     7.03. Redetermination Amounts. In the event of a redetermination of any Tax Item reflected on any Consolidated Return or Combined Return (other than Tax Items relating to Distribution Taxes), as a result of a refund of Taxes paid, a Final Determination or any settlement or compromise with any Taxing Authority which in any case would affect the DSW Separate Tax Liability, DSW shall prepare a revised pro forma Tax Return in accordance with Section 2.04(b) of this Agreement for the relevant taxable period reflecting the redetermination of such Tax Item as a result of such refund, Final Determination, settlement or compromise. DSW shall pay to RVI, or RVI shall pay to DSW, as appropriate, an amount equal to the difference, if any, between the DSW Separate Tax liability reflected on such revised pro forma Tax Return and the DSW Separate Tax liability for such period as originally computed pursuant to this Agreement.

5.	Capitalized terms used in this Amendment and not defined herein shall have the meanings given to them in the Tax Separation Agreement.
6.	The provision of this Amendment shall become effective as of the date hereof.

7. Except as expressly amended herein, all terms and provisions of the Tax Separation Agreement shall remain unchanged and in full force and effect.

     IN WITNESS WHEREOF, the parties hereto have executed this Amendment to Tax Separation Agreement as of the date set forth above.

RETAIL VENTURES, INC.
on behalf of itself and each of the RVI Affiliates
By:	/s/ James A. McGrady
Title: Executive Vice President, Chief Financial Officer
DSW INC.
on behalf of itself and each of the DSW Affiliates
By:	/s/ William L. Jordan
Title: Senior Vice President, General Counsel

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EX-99.1

Exhibit 99.1

For Release at 7:00 AM Eastern on August 28, 2008

DSW INC. REPORTS 2008 SECOND QUARTER FINANCIAL RESULTS;
REITERATES ANNUAL OUTLOOK

COLUMBUS, Ohio, August 28, 2008/PRNewswire/ — DSW Inc. (NYSE: DSW), a leading branded footwear specialty retailer, announced net income of $11.0 million on net sales of $357.2 million for the second quarter ended August 2, 2008, compared with net income of $6.5 million on net sales of $348.7 million for the second quarter ended August 4, 2007. Same store sales decreased 6.9% for the comparable period versus an increase of 5.9% last year.

Diluted earnings per share were $0.25 for the second quarter this year compared with $0.15 last year. The Company said the year-over-year increase in second quarter earnings was attributed to merchandise margin rate.

Six Month Results

Net income was $21.2 million on net sales of $723.4 million for the six months ended August 2, 2008, compared with net income of $30.3 million on net sales of $705.7 million for the six months ended August 4, 2007. Same store sales decreased 6.2% for the comparable six month period versus an increase of 0.9% last year.

Diluted earnings per share were $0.48 for the six months ended August 2, 2008, compared with $0.68 for the same period last year.

2008 Outlook

For the fiscal year ending January 31, 2009, the Company reiterates its estimated annual same store sales in the negative mid-single digits and annual earnings per diluted share in the range of $0.75 to $0.85. The Company plans to open at least 35 DSW stores during the year.

Webcast and Conference Call

To hear the Company’s live earnings conference call, log on to www.dswinc.com today at 8:00 AM Eastern, Thursday, August 28, 2008 or call 1-866-800-8649 and reference passcode 89256908. To hear a replay of the earnings call, which will be available approximately two hours after the conference call ends, dial 1-888-286-8010, followed by passcode 39833458. An audio replay of the conference call, as well as additional financial information, will also be available at www.dswinc.com.

About DSW Inc. DSW Inc. is a leading branded footwear specialty retailer that offers a wide selection of brand name and designer dress, casual and athletic footwear for women and men. As of August 28, 2008, DSW operated 278 stores in 37 states and operated an e-commerce site, www.dsw.com. DSW also supplied footwear to 383 leased locations in the United States. For store locations and additional information about DSW, visit www.dswinc.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Any statements in this release that are not historical facts, including the statements made in our “Outlook,” are forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on the Company’s current expectations and involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. These factors include, but are not limited to: our success in opening and operating new stores on a timely and profitable basis; continuation of our supply agreements with our leased departments; maintaining good relationships with our vendors; our ability to anticipate and respond to fashion trends; fluctuation of our comparable store sales and quarterly financial performance; disruption of our distribution operations; impact of the change in the shared services agreement; the risk of Value City Department Stores (“Value City”) deciding to discontinue operations or otherwise not pay its obligations for the transition services; impact of the disposition of a majority interest in Value City by Retail Ventures on the allocation of expenses pursuant to the shared services agreement with RVI; failure to retain our key executives or attract qualified new personnel; our competitiveness with respect to style, price, brand availability and customer service; declining general economic conditions; risks inherent to international trade with countries that are major manufacturers of footwear; the success of our e-commerce business; liquidity risks related to our investments; and security risks related to our electronic processing and transmission of confidential customer information. Additional factors that could cause our actual results to differ materially from our expectations are described in the Company’s latest annual or quarterly report, as filed with the SEC. All forward-looking statements speak only as of the time when made. The Company undertakes no obligation to revise the forward-looking statements included in this press release to reflect any future events or circumstances.

Source: DSW Inc.
CONTACT: Investor Relations for DSW Inc., 1-614-872-1474

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DSW INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)

	August 2,		February 2,
	2008		2008
ASSETS
Cash and equivalents	$	57,687	$	61,801
Short-term investments		75,480		70,005
Accounts receivable, net		11,881		14,343
Inventories		286,869		262,037
Prepaid expenses and other current assets		24,850		23,134
Deferred income taxes		21,903		20,302
Total current assets		478,670		451,622
Property and equipment, net		220,554		192,772
Long-term investments		5,760		12,500
Goodwill		25,899		25,899
Tradenames and other intangibles, net		4,095		4,522
Deferred income taxes and other assets		3,646		6,567
Total assets	$	738,624	$	693,882
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts payable	$	125,192	$	114,595
Accrued expenses		60,567		54,310
Total current liabilities		185,759		168,905
Deferred income taxes and other non-current liabilities		95,782		91,497
Total shareholders’ equity		457,083		433,480
Total liabilities and shareholders’ equity	$	738,624	$	693,882

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DSW INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(Unaudited)

	Three Months Ended						Six Months Ended
	August 2,			August 4,			August 2,			August 4,
	2008			2007			2008			2007
Net Sales	$	357,175		$	348,718		$	723,439		$	705,715
Cost of sales		(256,081	)		(267,368	)		(525,298	)		(515,109	)
Gross profit		101,094			81,350			198,141			190,606
Operating Expense		(83,415	)		(73,024	)		(164,456	)		(145,062	)
Operating Profit		17,679			8,326			33,685			45,544
Interest income, net		420			1,948			1,143			3,667
Earnings before income taxes		18,099			10,274			34,828			49,211
Income tax provision		(7,142	)		(3,753	)		(13,583	)		(18,946	)
Net Income	$	10,957		$	6,521		$	21,245		$	30,265
Basic and diluted earnings per share:
Basic	$	0.25		$	0.15		$	0.48		$	0.69
Diluted	$	0.25		$	0.15		$	0.48		$	0.68
Shares used in per share calculations:
Basic		43,999			43,953			43,983			43,947
Diluted		44,242			44,338			44,195			44,349

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