according to chairman lampert: “we are moving from an era ... · fuel the company’s...

1—STRAIGHT TALK Summer 2012—

Volume 15, Issue 2 Summer, 2012

This issue of STRAIGHT TALK:Sears Annual Meeting p. 1

Group Life Insurance Plan p. 4

Giving from the Heart p. 5

The 800 Pound Gorilla p. 6

Obituaries p. 8

December 28, 1998 p. 9

Renew Now! p. 10

Lampert's Cons & Pros p. 11

Life after Sears p. 12

Sears Holdings chief Eddie Lampert reiterated to shareholders at Sears’annual meeting last May his multichannel plan of investing heavily in e-and m-commerce operations to help return the company to profitability.

Lampert added that the company is “not planning to just survive” but tothrive as a result of actions it’s taking not only to win back disillusionedshoppers but to get more productivity out of its real estate holdings.

At a media briefing after the meeting, Lampert said, “We’re not just sitting herethinking that things will magically get better. We’re taking a lot of actions.”

However, Lampert admitted that his vision for the company really hasn’tchanged despite six straight years of slidingsales at U.S. stores open at least 12 months.

For years, Lampert said, the challenge hasbeen to move Sears and Kmart away from a20th-century business model focused onserving customers in large stores, and to-ward a future-focused model that involves collecting and analyzing cus-tomer data to target shoppers in physical locations as well as onInternet sites.

His attempts to realize that goal haven’t always worked, he conceded.But, he said, “to transform you have to take certain kinds of risks.”

“Change or Die”Chairman Lampert, President and CEO Lou D’Ambrosio and chief mer-chandising officer Ron Boire said they will continue to beef up the company’swebsite and multichannel Shop Your Way Rewards loyalty program, lookfor new licensing opportunities for its private brands, and improve the in-store experience with better lighting and improved product adjacencies.

“The world is changing; we have to take advantage of that to bring thiscompany forward,” said D’Ambrosio. “If we don’t do it, there are conse-quences. You change or you die.”

Much emphasis is being placed ononline shopping. Lampert told thecrowd of about 250 shareholdersand employees, about half of the at-tendees were employees, that theWeb and mobile devices influencemore consumers’ shopping habits.Therefore innovation in this field willfuel the company’s transformation.

Shop Your Way ProgramInitiatives aimed at boosting Sears’sagging bottom line include invest-ing millions of dollars in its Web andmobile-driven Shop Your Way Re-wards loyalty program and armingassociates with iPads to help cus-tomers shop more quickly and effi-ciently in stores and, ultimatelyspend more money.

According to Chairman Lampert:

“We are moving from an era of guessingto one of knowing.”

Continued on page 2


The Rewards Loyalty Program isbeing used to gain better informa-tion about what customers want.

Why is Sears spending so much timeand cash on technology? Accordingto D’Ambrosio, customers are on theInternet longer than they are watch-ing television. He said that 50% ofcustomers have smart-phones to-day, compared to two years ago.Seventy-percent of these customersuse their smart-phones while shop-ping. And 80% of smart-phone own-ers use the social networks toresearch products.

The company’s focus on technologyand its customer reward programwill allow Sears to avoid joining alist of failed retailers, including Bor-ders, that “didn’t realize howquickly the world is changing,”D’Ambrosio said.

Integrated Retail PlanChairman Lampert is plac-ing most of the company’s“retail eggs” in a strategycalled an “integrated retailplan” which connects theshopping experience inSears stores with thecompany’s web and mobileexperience. This is all tiedinto the Shop Your Way programthat has “tens of millions”of members.

The company’s 2½-year old ShopYour Way Rewards membership pro-gram is the centerpiece of the inte-gration plan. It allows members toearn and spend points across Sears,Kmart and Lands’ End merchan-dise, return items without receiptsand create shopping lists much likeAmazon wish lists.

“We believe customers operate inmany different worlds simulta-neously,” D’Ambrosio said.

The Web focus also dramatically in-creases the amount of merchandiseavailable to customers, he said.While Sears stores house about onemillion items, Sears online market-place has 30 million.

Sears will connect its customer ex-perience in stores, online, in cus-tomers’ homes via its service anddelivery segment and on the phonevia its call center. “I don’t think any-body (else) can pull it all together,”D’Ambrosio added.

“This is a great company with enor-mous assets. We’ve done somethings very well, done some thingspoorly. I think in the end you’ll haveconfidence of where we’re taking thiscompany,” D’Ambrosio said.

Public or Private?There has been much discussion inthe press about whether Lampertwill take Sears Holdings private.However, consider that Lampert andhis funds together already ownroughly 62% of Sears Holdings.

In addition, the seven Board direc-tors (Louis J. D’Ambrosio, William

C. Kundler III, Edward S. Lampert,Steven J. Mnuchin, Ann N. Reese,Emily Scott and Thomas J. Tisch)own an additional significantamount. Some have wonderedwhether Sears Holdings really needsto go private? Isn’t it really a pri-vate company now with some liquid-ity for the principal shareholders tocash-in on the chips now and again?

There were many questions andcomments from shareholders. Noone was cut short. A shareholder,Martin Glatzer, expressed dissatis-faction with the size of thecompany’s board. He said that sevenboard members are too small of anumber for the size of Sears Hold-ings. Many companies smaller thanSears have more directors. Anothershareholder objected to Lampertrunning the company. He said thatLampert and all of the directors

should look for another job!

Meeting CommentsAnalysts at the meeting saidthey were impressed withthe transformation plan, butconcerned about how fastand effectively Sears wouldexecute it.

Credit Suisse analyst GaryBalter said, “In terms of

what they say, they are trying hard.The problem is they start with sucha disadvantage.”

Another analyst, Morningstar’s PaulSwinand said that the company stillhas a long way to go in terms of imple-menting the plan across all stores andincreasing customer service.

In response to the many reports ofthis meeting, a Sears observerwrote: “It will be interesting to seewhether or not they can truly strivenot to go the way of Border’s, Mont-

Edward Lampert

Louis J. D’Ambrosio Ron Boire

Era Continued from page 1

Continued on page 3


gomery Ward, Woolworth’s and oth-ers as the idea of becoming an e-commerce powerhouse is hinderedby thousands of outdated/anti-quated retail locations as well as amerchandise mix that is truly allover the board. One can only hopethat they can turn it around … ”

EDITOR’S NOTE: The above article wasassembled from reports of our ownrepresentatives, Dave Silger and BillBarker, N.A.R.S.E. Board members,and also news accounts from theAssociated Press, Chicago Business,Chicago Tribune, Crain’s Chicago,Forbes, New York Post, Reuters U.S.Edition, TWICE, and The WallStreet Journal.

Era Continued from page 2 N.A.R.S.E. Presentation atSears Holdings Annual Meeting

Wednesday, May 2, 2012Good morning. My name is Bill Barker. I am a Sears retiree and mem-ber of the Board of Directors of N.A.R.S.E., the National Association ofRetired Sears Employees, which represents the interests of thousandsof Sears retirees nationwide.

Retirees and their families are vitally concerned about Sears Holding’ssuccess and future growth. This is no doubt due to self-interest, but isalso the honest expectations of retirement after a working life investedin Sears.

Consequently, retirees are rightly concerned about the security of theirpensions, medical and health care, paid-up life insurance, merchan-dise discounts and other benefits they earned during their long anddedicated service to the company.

The insurance benefit is extremely important to many retirees sincethat is the only life insurance that they have. We are also equally con-cerned about all of the recent negative press about Sears.

On a positive note, we appreciate the opportunity that N.A.R.S.E. hadto meet with the Sears Director of Benefits and HR Policy last March.We hope that this meeting will form the basis of having a future, posi-tive dialog between Sears and N.A.R.S.E.

By opening up this line of communication with N.A.R.S.E., for Searsthis will be an additional means of communicating with thousands ofSears retirees nationwide. It will certainly provide you with a true feelfor the pulse of Sears retirees everywhere.

In conclusion, we want Sears to more than survive, but to prosper.And under your leadership, we wish you the best in your efforts to be amajor internet destination and in adapting to meet the changing, com-plex and very competitive retail environment.

We may have retired, but we are alumni and we care about our company.

More than the Big StoreBy John D. Nielsen, Jr.

In his 1987 book, The Big Store,Donald Katz, explained the crisisand foretold the reasons for the cur-rent downfall of retail giant SearsRoebuck and Co. This hit home re-cently in Honolulu with the an-nounced closure of the company’sAla Moana flagship store.

Sears in Hawaii was more than aretailer. To thousands of islandersit represented fairness in employment,a change from the Big Five monopolyof retailing and shipping, and local andmainland goods for sale at fair prices.

It had a wholesale buying office topurchase local Hawaii manufac-tured goods like aloha shirts andsouvenirs for the only departmentin any Sears Store selling Hawaiiangiftware items. The gift-wrapping de-partment, in the store’s exteriormauka wall on the mall level wasthe busiest in the country.

At its peak, Ala Moana was the larg-est and most profitable store in

Sears. Though, the bosses in Chicagostill tried to ship snow tires in thewinter to be sold in the islands. Auwe!

At Sears Ala Moana, you could getyour hair cut at the Sears BarberShop while you had your car tunedup in the automotive departmentfollowing breakfast in the coffeeshop, and then get some candy orheated cashews for a walk throughthe then-largest furniture selectionon its third floor.

Ala Moana became the first Searsstore in the United States to retailLevy’s Jeans in the 1970s. The say-ing “Satisfaction Guaranteed or YourMoney Back” was not just a slogan.For Sears’ employees from the shoedepartment saleslady to the washer-dryer repair guy it was a way of life.

Sears Ala Moana had more 40-yearplus employees than anywhere else

Continued on page 9


By Richard D. Bruce

Editor’s Note: Over the past yearwe have receivedmany commentsand questionsabout the SearsGroup Life Insur-ance and how thelitigation settledin 2002 impactedsuch insurance.

Richard D. Bruce, the author of thisarticle, was a named plaintiff in thislawsuit. Mr. Bruce was employed atSears for about 34 years. For manyof those years he was in D/707 in avariety of positions including managerof training, policy, benefits and com-pensation; and also manager of execu-tive compensation at headquarters.

Sears Group Life Insurance Plan wasinitially insured by Allstate Life In-surance Company, and was com-monly referred to as “paid-upretirement life insurance” bySears employees.

Effective January 1, 1989, SearsGroup Life Insurance Plan becameinsured by Metropolitan Life Insur-ance Company. This plan wasamended on November 1, 1992, todiscontinue providing any life insur-ance coverage except to retirees andcertain disabled associates. It wasrenamed Sears Retiree Group LifeInsurance Plan (“the Plan”).

Effective August 1, 2010, The Pru-dential Insurance Company ofAmerica became the underwriterand administrator of the Plan.

Eligibility under the PlanEligibility for Retiree Life Insuranceunder the Plan required being in-sured under the Plan as a retiree on

December 31, 1996; or were insuredunder the Plan as an associate onOctober 31, 1992, and you retiredfrom Sears after December 31, 1996,but before January 1, 1998.

To be eligible for Retiree Life Insur-ance at the time you retired youmust have been:• At least 55 years of age with at

least 20 years of continuous ser-vice: or

• At least 60 years of age with at least10 years of continuous service.

The eligible Amount of Retiree LifeInsurance was equal to 40% of theAmount of Life Insurance in effecton August 31, 1987, up to a maxi-mum Amount of Retiree Life Insur-ance of $100,000. (The amount oflife insurance coverage for each em-ployee varied, and was calculated bya formula based on salary).

January 1, 1998 and beyondEffective January 1, 1998, a changewas implemented under the SearsGroup Life Insurance Plan that re-sulted in a reduction of the Sears-provided retiree life insurance overa 10-year period ending withyear 2007.

This reduction in retiree life insur-ance affected approximately 80,000retirees and caused a serious rift be-tween many of these retirees andSears. As a result, a number of suitswere filed against Sears by retireeswho believed they had been prom-ised “free” or “paid up” life insurancefor the rest of their lives. In addition,many retirees protested in angrydemonstrations against Sears.

The various lawsuits by retireeswere eventually consolidated in theUnited States District Court in Chi-

cago, Illinois, and were assigned toJudge James B. Moran.

The parties began negotiations inMarch 2001, at a time when theywere preparing to try the breach offiduciary duty claims of a group oftwelve named plaintiffs. On June 1,2001, Sears moved for summaryjudgment on the breach of fiduciaryduty claims of each of the namedplaintiffs in this first group.

On June 5, 2001, after extensivemediation the parties reached agree-ment to settle the case. On Octo-ber 10, 2001, the Court directed theparties to provide each class mem-ber with a copy of a notice of thesuit and a claim form.

In addition, a copy of the “Settle-ment Announcement Sears RetireeGroup Life Insurance” notice wasrun in a number of newspapers in-cluding the Arizona Republic, Chi-cago Sun-Times, Chicago Tribune,Dallas Morning News, Los AngelesTimes, and the Miami Herald.

Approximately 56,000 retirees filedclaims to participate in the settle-ment. These 56,000 retirees whofiled claims demonstrated they werewilling to swear under oath thatSears had misled them about theirlife insurance benefit. Another 128rejected the settlement, and the re-maining retirees did not file a claim.

A final approval hearing on thesettlement was conducted onMarch 5, 2002, by Judge Moran.

Summary of Settlement TermsWhether or not you filed a ClaimForm, the Settlement Agreement

History of Sears RetireeGroup Life Insurance Plan/Litigation

Continued on page 5


Sears Retiree Giving from the HeartSears, Roebuck & Company “Sears” re-tiree, Joe Shafer, resident of Lawrenceville,Georgia, and retiree of the former At-lanta Catalog Merchandise DistributionCenter “ACMDC” on Ponce de Leon inAtlanta, Georgia, is serving his commu-nity through his generous gift to the Phi-lanthropist Fund at Gwinnett MedicalCenter “GMC” in Lawrenceville, Georgia.

He also serves on the board of GMC. Joesaid, “I serve with enthusiasm, andthrough the years I have seen the facil-ity grow. I have taken steps to ensurethat the growth of the medical centerwill continue.” As part of Joe’s estateplans, he has designated the Gwinnett

Medical Foundation as beneficiary to receive—after his death—an invest-ment account in memory of his deceased wife, Dorothy Brannan Shafer.

Joe began working at Sears in the plumbing department after graduatingin 1945 from Lilburn High School in Gwinnett County, Georgia. He said,“My plans were to work through the Christmas rush where I would havesome extra spending money; however, I decided to stay with the com-pany, and approximately 43 years later retired.” He worked in variousdepartments and held several positions throughout his tenure. After re-tiring Shafer and his wife, Dottie, traveled, enjoyed the company of familyand friends, and rarely missed going to a Georgia Bulldog Football game.

Scholarship FundIn 2006 Joe and his wifeDottie created theJ. Floyd and EuniceBrannan scholarshipfund. This fund was ini-tiated in memory ofDottie’s parents and isgiven to students who at-tend a Gwinnett CountyPublic School and whoattend First Baptist Church in Lawrenceville, Georgia. Joe believes ingiving where it helps youth get an even shake in this competitive world.

The Beat Goes OnJoe is a victim of heart problems and says he is now on his third set of pacemakers.

Article is written by Linda Chastain, former Sears employee, Atlanta, Geor-gia, who is a member of the Atlanta Sears Family Club. Joe was recentlyfeatured in a publication of the Gwinnett Medical Center Foundation. He is amember of various organizations, includ-ing the Atlanta Sears Family Club.

provides that Sears cannot furtheraccelerate the life insurance reduc-tion schedule that began in 1998,and it cannot reduce the final in-surance amount to less than $5,000.

1. Class members who timelymailed claim forms that are ap-proved are guaranteed at leastone less annual reduction thanthe scheduled ten reductions.Their final insurance amountwill, therefore, be at least $5,000plus the amount of one year’s re-duction. The “skipped” reductionwill be the reduction previouslyscheduled for the year 2003.

2. Attorney fees and costs of the liti-gation will be paid by Sears, notthe Class. The Court granted feesand costs in the amount of$5.43 million.

3. This Settlement is binding on allclass members who do not re-quest exclusion.

Correspondence dated March 2007,from the Sears Holdings RetirementService Center provided the finalvalue of your basic Sears RetireeGroup Life Insurance, and if youopted to participate in the SearsGroup Retiree Life Insurance Re-placement Plan. This correspon-dence also included “Clarificationsto January 1, 2007 SPDs”which stated:

Notwithstanding the list of annualreductions on page 10 of the SPDunder the section entitled RetireeLife Insurance Reductions, pleasenote that any covered retiree whomade a proper claim under the2001 Settlement Agreement forthe litigation known as In re re-duction (Reduction #6). In otherwords, these retirees were sub-ject to nine (9) instead of ten (10)reductions. This is reflected onyour March 2007 personal state-ment included with this notice.

History Continued from page 4


On December 31, 2012, trillions ofdollars in tax cuts will expire, tril-lions more in new tax hikes underObamaCare will kick in, and a tril-lion in automatic spending cuts willbegin. Happy New year!

As stated by Donald L. Luskin, chiefinvestment officer at Trend MacrolyticsLLC., in The Wall Street Journal:

“Maybe with the date still faraway, the fiscal cliff just doesn’tseem real. It’s certainly beingtreated that way on both sides ofthe political divide.

“On the left, economists claimwith a straight face that evenhuge tax hikes don’t matter—atop tax rate as high as 70%, theyclaim, would have no chilling ef-fects on top earners’ incentives.

“On the right, they just as sol-emnly claim even a small rise inthe top rate for high earners fromtoday’s 35% to the 39.6% sched-uled for after year-end will bringabout economic ruin.”

2013 Tax System?So what is the gorilla contemplatingwith the expiration of the Bush tax cuts?

The 800 Pound Gorilla in the Corner!• Top tax rate on capital gains of

44% (including 3.8% tax on in-vestment income for Obamahealthcare law).

• Capital Gains tax moves from15% to almost 24%.

• Dividend tax moves from 15% toalmost 44%.

• Estate tax lifetime exemptiondrops from 5 million to 1 million.

• Highest ordinary income taxbracket moves from 35% to 44%.

If Congress does not pass legisla-tion, ALL of the above is what ourtax system will be in 2013.

All these tax issues will have to getnegotiated in the lame duck sessionof Congress after what is likely to bean unusually bitter election season.

Federal Reserve Chairman BenBernanke has described the simul-taneous onset of tax increases andspending cuts that will be triggeredon January 1 unless Congress acts,as a “fiscal cliff.”

Combined, the policies would take$7 trillion out of the economy over10 years—about $500 billion ofwhich would occur in 2013.

Can Bernanke Help?On more than one occasion, the Fedchairman has all but begged law-makers not to mess this one up.

“[I]f no action were to be taken, thesize of the fiscal cliff is such thatthere’s I think absolutely no chancethat the Federal Reserve … could orwould have any ability whatsoeverto offset … that effect on theeconomy,” Bernanke said recently.

What Will Congress Do?Given that it’s an election year, andthe balance of power between theparties is up for grabs, many observ-ers expect lawmakers won’t evenbegin to address the fiscal cliff inearnest until after November 6.

Dealing with the fiscal policy pile-up in less than seven weeks will bea hot mess. Indeed, former Repub-lican Senator Alan Simpson is pre-

dicting the lame-duck session ofCongress will be “chaos.”

One potential outcome: A pack-age that extends some tax cutsand postpones some spendingcuts, effectively punting the realdebate to the new Congress in 2013.

House Budget Chairman Paul Ryan,a leading Republican on fiscalpolicy, has said publicly that hewould welcome that outcome if itwere proposed by President Obama.

And a temporary package to buytime also seems to be the defaultexpectat ion among many onCapitol Hill.

Continued on page 7


The terms of that package couldvery well be determined in tandemwith the debate over raising thedebt ceiling, which will make thingsmessier still.

What Can You Do?So, what exactly will you encounterif next year arrives without any al-terations to the current tax law?You’ll face higher income tax rates,more taxes on investment income,fewer tax breaks for families, thereturn of so-called stealth taxes anda tougher estate tax.

What can you do to prepare for theworst-case tax increase scenario? Insome instances, quite a bit if youstart your tax planning now. Inother tax situations, not so much.But you might be able to make ad-justments elsewhere to offset thechanges if tax cuts expire.

You might also start lobbying yourCongressional representatives if youare concerned about the higher taxrates. Let them know what the “fis-cal cliff” will mean for you.

As Doug Mataconis suggested in theOutside the Beltway website recently,

“ … it’s a game of chicken, andwhen both sides already knowthat neither one wants to allowthe tax cuts (or the payroll taxholiday) to expire because of theimpact it would have on theeconomy, that gives the GOP asignificant negotiating advantage.

“So, count on the Bush Tax Cutsstaying around for at least an-other two years absent some kindof comprehensive tax reform inthe first year in office whoeverhappens to take the oath of officeon January 20, 2013. At thatpoint, shouldn’t we start callingthem the Obama Tax Cuts, ormaybe the Romney Tax Cuts?”

Gorilla Continued from page 6

Buoyed by the reaction to his firstnovel, Doug began to unravel the taleof a new hero, a loner who soughtto right impossible wrongs, acts per-petrated by a level of people protectedfrom society through their positionsand power. Cloaked in secrecy, thecharacter seeks to remove these vil-lains from our government. His strictrules, which protect that secrecy,work well but are hard to maintain.

Perhaps the best description of hiswork would come from the words ofothers. “While keeping you on theedge of your seat!” says BarbaraBarth of Lilburn, Georgia.

Dahlgren’s second novel, The SONSilas Rising is a political thriller thatgrabs you in at the beginning andkeeps you focused to the end.

That book is the first of series thatnow includes two sequels, The OnlyConstant, and The Basics of Funda-mentals. A fourth is scheduled forrelease this fall, 2012.

From a review of the first “SON”book, a reader wrote, “For those wholoved Jack Bauer, of TV’s ‘24’ fame,Dahlgren’s Jon Crane will catch yourinterest. Crane is the dark hero of‘The SON.’ Hero or Avenger? As a con-cerned citizen, Jonathan Crane is likeno one you have ever met. Some read-ers call Crane a cross between Dex-ter and James Bond and the book asintriguing as any in the Bourne series.”

Another reviewer on Amazon stated,“Dahlgren is up there with JohnGrisham and James Patterson forpage-turning excitement and antici-pation! A real life Batman andRobin—but without the fictional ‘Me-tropolis’—all the bad guys are ‘hid-ing’ in Washington, D.C.!”

Dahlgren’s stories are described as“wonderfully intricate, combiningpolitical intrigue, international drugsmuggling, inventive retribution andthe latest technology into a fast-paced thriller.”

Elliott Brack, of the GwinnettForum.com,added his own review of “The SON”in his column dated April 12, 2011:“Let’s put it this way: I finished thebook at 12:08 a.m., well past my nor-mal bedtime, and in three days, sim-ply because the book is socompelling. (This book is) as good aread as those by major thriller au-thors. The story line focuses on thedeath of four members of Congressover several months …. all from ap-parently natural causes. Not so, aswe learn from one uniquely talentedperson, with innovative techniquesthat go undetected. And now a fifthmember of Congress is being tar-geted … and people all over the na-tion are getting worried. The book ishard to put down.”

Dahlgren’s writing style is takenfrom what he calls “solid, depend-able character study.” Based on thepersonalities of people he has metthrough his over 35 years in busi-ness, his characters are some youmay recognize as folks you know.You may even see yourself onthe pages.

Dahlgren’s works are fiction, but asthe writer calls them, “Plausible Fic-tion.” Stories that the reader canbelieve “could happen” with gadgetsyou have to “look up” to prove theywere “made up.”

Doug and his wife of nearly 45 yearsstill live in the Atlanta area. Theyhave three grown children andtwo granddaughters.

Life Continued from page 12


Blair G. Holden, 79, of Richland, Michigan,passed away after a brief illness in PuntaGorda, Florida, on February 26, 2012. Blairwas a regional vice president of N.A.R.S.E.and one of the founding members of the re-tiree organization.

He spent 37 years with Sears, Roebuck, and the last 16as the general manager of the Frandor store in Lansing,Michigan. His career at Sears gave his family the oppor-tunity to live in several states, including South Dakota,the agreed favorite.

Blair was a 1955 graduate of the University of Wiscon-sin–Madison where he participated in the Army ROTC,ultimately achieving the rank of captain. His sports loy-alties were split between the Badgers and his adoptedMichigan State Spartans.

He spent 20 happy years enjoying retirement to the fullest.He loved sailing at Gulf Lake in Richland, Michigan, where heand his wife Olga spent their retirement years. His wife, threedaughters, five grandchildren, and three siblings survive him.

Anthony Norris, Tony as he was known tocoworkers, friends and family, passed away onFebruary 19, 2012. Tony was born in Somerseton June 8, 1944, and spent his formative yearsin England. He then served with the BritishMerchant Navy and the Australian Army prior

to immigrating to the United States and working with Sears.

After suffering the effects of a spinal tumor which lefthim paralyzed, a quadriplegic, he returned to work as acomputer and merchandise specialist in Department 615,a position he held until he retired.

Tony was an advocate for the disabled, creating a pro-gram that allowed children with disabilities to spend timewith him at work, and he was actively involved at the IllinoisCenter for Rehabilitation and Education in Chicago. Becauseof his advocacy and positive attitude, Tony was inductedinto the National Hall of Fame for Persons with Disabilities.

He was also very active with the Chicago based “SearsRetiree Volunteer Club” which was initially sponsored bySears and continues to work voluntarily with Chicago PublicSchools, the Food Depository and various other charities.

Known for his quick wit and story telling, Tony was lovedby all and will be missed.

Bernard (Bud) Defano, a found-ing member of N.A.R.S.E. andmembership chairman of our or-ganization for many years, passedaway January 26, 2012, fromprostate cancer and kidney fail-

ure. He was 84.

Bud began working for Sears in the Chicagocatalog plant when he was a sophomore in highschool wrapping packages and working in therug division and in the boiler room in the Searsheating plant. After graduating from college,he worked in the headquarters constructiondepartment as an electrical engineer and inthe same capacity in later years in the Mid-west Territory.

He was promoted to construction manager andlater to real estate manager in the territory.He retired from the company in 1985 after 43years with Sears.

In addition to being a very active member ofN.A.R.S.E. during his retirement years, he alsoenjoyed hunting and woodcarving. His duckcarvings were so realistic that you felt you couldactually feel their feathers.

Bud entered one of his duck carvings in theChicago Botanical Gardens Wood Carving Ex-position winning third place and then winningfirst place in a later year exposition with a full-sized carving of a carousel horse. He also carvedtoys for his children, grandchildren and manyothers. In fact, one of our board members hasone of his duck carvings.

Bud and his wife Angie were married 62½years. They had three boys, Matthew, Josephand Robert, and seven grandchildren. He hadtwo sisters, one who preceded him in deathand another living in Arizona.

Up to the time of his illness, he attended everyone of our monthly meetings. Bud was not onlyan artist but also a good friend. We will misshis presence and advice at our future meetings.

Obituaries


in the United States or internation-ally. Many UH graduates got theirstart in business in Sears’ manage-ment training program and neverleft. It even had candidates for stateand citywide elected office speak toemployees in its third floor lunch-room before work.

My love affair with Sears in Hawaiibegan for my family and me whenDad became the general manager.

Big Store Continued from page 3

Do you remember? This photo-graph was taken at the Annual“Big Ticket” Luncheon that washeld at Bailey’s Restaurant inElmhurst, Illinois, onDecember 28, 1998.All of these Sears,Roebuck and Co. re-tirees had some con-nect ion with “BigTicket” merchandise,speci f ical ly withD / 6 2 0 — s e w i n gm a ch in e s andvacuum cleaners.

Pictured, from left toright are: Lew Orlow,George O’Hare, MelSchultz, Al Sneed, DanDanhauer, Hugo Bliss,and Charles Harper.Lew Orlow, whopassed away duringNovember 2004, pro-vided this photo to usmany years ago.

Lew Orlow was a sales managerin 620. George O’Hare said thathe dedicated 68 years of mer-chandising, training and salespromotion at Sears, Roebuck andCo. “It was actually only 34 years,but I worked twice as hard,” he

said. When George retired in1984 he became a fu l l - t imemotivational speaker.

DECEMBER 28, 1998time in a number of positions inD/620. And Charles Harper wasnational merchandise manager ofD/620 during his earlier years at

Sears and retired as Sears corpo-rate secretary.

This group of “Big Ticketers” got to-gether on a regular basis to relivethe “good old days” at Sears, Roe-buck and Co.

We arrived in Honolulu in 1967. Ahundred Sears employees dressedin bright-colored muumuus andaloha shirts met us at Honolulu Air-port with more leis than I got at mygraduation from Iolani School sixyears later. We still meet and greetemployees and retirees everywherein Hawaii. They will always be ourextended ohana.

Mahalo Sears Hawaii!

Mel Schultz was manager of fieldadvertising services. Al Sneed wasa buyer in D/620. DannyDanhauer, who held numerous BigTicket positions at Sears, retired asnational merchandise manager ofD/657. Hugo Bliss also served his


We again thank you for your pastand present support for our retireeorganization, which has beenaround since 1997. Straight Talk,with informative articles and com-ments about your company, the re-tail industry in general, and whatthe “feds” are doing with retiree ben-efits, could not be printed andmailed without your support and thesupport of many others. In addition,the N.A.R.S.E. Web site,www.narse.org would not exist with-out your financial contributions.

Also, with your financial and moralsupport, the fact that you are aN.A.R.S.E. member, along with thou-sands of other retirees, is vitally im-portant because when large numbersof retirees band together, this notonly attracts attention from the me-dia, but also from our own company.

Today, N.A.R.S.E. is the oldest, ac-tive retiree organization in the coun-try. We meet the second Friday of everymonth, except for August. During eachof our meetings, we provide a toll-freeconference call for our board memberslocated around the country and oth-ers to join in on our meeting. We sin-cerely value all of our members’ input.

At our May meeting we elected ourBoard and officers for the next threeyears. Our Directors are:

Ron Olbrysh, Lombard, IL,Chairman

Ernie Arms, Hinsdale, ILBill Barker, Wilmette, ILDick Bruce, Elmust, ILClaude Ireson, Bonita Springs, FLKen Johnson, Lake Forest, ILLeo McCormack, Naperville, ILMel Schultz, Northbrook, ILDave Silgers, Sleepy Hollow, ILKeith Tice, Glen Ellyn, ILLloyd VanSchoyck, Chandler, AZSandra Wheeler, Atlanta, GA

Our Officers are:

Art Levin, President, Sun City, AZKeith Tice, SecretaryLeo McCormack, TreasurerErnie Arms,

VP Electronic CommunicationsBill Barker, VP Club RelationsLloyd Van Schoyck, VP LegislationGeorge O’Hara, VP Media Relations,

Hinsdale, IL

And finally, our Regional VicePresidents are:

Tom Douglas, San Diego, CARichard Foulke, Fallston, MDWalter McDade, Sandyville, OHTom Nally, Springfield, VARuth Pilant, Riesel, TXTom Myers, Bradenton, FL

We are a non-profit, volunteer or-ganization with no paid employees.Our Board members and officers willcontinue representing your interestsand keeping you informed on Searsactivities and federal issues. In otherwords, N.A.R.S.E. is not only inter-ested in what Sears is doing but alsohow our Congressional representa-tives are impacting our lives.

Because of our mission, I am ask-ing you, if you have not already doneso, to renew your N.A.R.S.E. mem-bership for 2012. Enclosed is aMembership/Renewal Applicationform and mailing envelope.

If you have already renewed, thenplease pass the application formto someone you feel could benefitfrom membership in our organi-zation. If you have any comments,suggestions or questions, you maycontact me, Ron Olbrysh, [email protected].

As we have said many times before,we are here to keep you informedand to be your independent voice toour company, now known as SearsHoldings. Your continuing financialsupport directs N.A.R.S.E. to con-tinue to live up to our slogan firstheard outside of the Art Institute ofChicago in 1998:

IF YOU HAVE NOT RENEWED YOUR 2012 N.A.R.S.E.MEMBERSHIP YET, PLEASE DO SO TODAY!

We Are Not Going Away!

Photos from previous N.A.R.S.E. meetings.


In the May 12, 2012, issue of Forbesmagazine, contributor AdamHartung suggested five chief execu-tives who should have already beenfired. Unfortunately, our SearsHoldings Chairman, EdwardLampert, was in this infamousgroup that included Cisco, GE, Wal-Mart, and Microsoft.

While Mr. Lampert told sharehold-ers at SHC’s Annual Meeting in Maythat the company is not planningto just survive but to thrive as a re-sult of actions it is taking to winback customers and to help returnthe company to profitability,Mr. Hartung’s dismal view is basedupon the following:

“OK, Mr. Lampert is the Chairmanand not the CEO—but there is nodoubt who calls the shots at Sears.And as Mr. Lampert has called theshots, he’s missed every target.

“Once the most critical force in re-tailing, since Mr. Lampert took overSears has become wholly irrelevant.Hoping that Mr. Lampert couldmake hay out of the vast real estateholdings, and once glorious brandsCraftsman, Kenmore and Diehard toturn around the struggling giant,the stock initially took off rising from$30 in 2004 to $170 in 2007 as JimCramer of “Mad Money” fame floggedthe stock over and over on his rant-a-thon show.

even valuing its stores at a third ofcomparable publicly traded retailproperties imply a value of about$5 billion.

He goes on to state “the company’snet inventory is $5.5 billion. Andcatalog retailer Land’s End, whichthe company is considering selling,could be worth another $1.2 billionto $1.6 billion, Credit Suisse says.Finally, consider the value of brandssuch as Kenmore, which has a 17%share in major appliances, as wellas DieHard and Craftsman.”

When you add all of this up, the sumof Sears parts seems to be well inexcess of its $8.2 billion enterprisevalue, or its market value plus netdebt, according to Jakab.

He adds that you can say what youwill about his retailing instincts,“but Mr. Lampert is a master of fi-nancial engineering and seems tohave learned his lesson aboutmicromanaging. And, as a lockupperiod expires for some investors inhis hedge fund this summer,Mr. Lampert has an incentive tocrystallize some value atSears soon.”

ESL Investments, Mr. Lampert’shedge fund, notified its partners inApril that it was relocating its head-quarters from Greenwich, Connecti-cut, to Miami, Florida, effectiveJune 1, 2012.

Five CEOs Who Should Have Already Been Fired“But when it was clear results wereconstantly worsening, as revenuesand same-store-sales kept declining,the stock fell out of bed droppinginto the $30s in 2009 and againin 2012.

“Hope springs eternal in the micro-managing Mr. Lampert. Everyoneknows of his personal fortune (#367on Forbes list of billionaires.) ButMr. Lampert has destroyed Sears.The company may already be so fargone as to be unsavable. The stockprice is based upon speculation ofasset sales. Mr. Lampert had noidea, from the beginning, how to cre-ate value from Sears, and he surelyshould have been gone manymonths ago as the hyped expecta-tions demonstrably never happened.”

Lampert SkepticsHowever, last month in an articlein The Wall Street Journal, SpencerJakab noted “Chairman EdwardLampert may deserve the benefit ofthe doubt this time. Once hailed asthe next Warren Buffett, the hedgefund manager’s quirky ideas aboutretailing, along with the revolvingdoor in Sears’s executive suite, mayhave bred too much pessimism.”

Mr. Jakab said that of the more than4,000 stores at the end of 2011,Sears Holdings still owned 821 andhas other properties also. ThoughSHC has skimped on renovations,


There Certainly Is Life after SearsUpon leaving Sears, some retireessimply enjoy life by traveling, spend-ing more time with family andgrandchildren, doing volunteer work,etc. However, there is an Atlanta,Georgia, retiree, Doug Dahlgren,who is a self-published authorwhose books are available on-linethrough Amazon.com,BarnesNoble.com, andBooks-a-million.com.

Born in Sault Ste. Marie,Michigan, but raised atrue southerner, Dougspent most of his highschool years in SouthGeorgia. Moving withfamily to the Atlanta area in 1964,he has spent his adult life there.

Doug started his career at Sears in1971. After discharge from the U.S.Army, he interviewed for a positionat the newly opening Northlake Mallstore, Unit 1275, in North Atlanta.Within eighteen months, he waspromoted to division manager at

Buckhead store, in downtown At-lanta, Unit 1235. He was a divisionmanager there for over ten years.

When that store was marked forclosing in 1983, Doug transferredto Division 400 and had a success-ful 20-year run as a representa-

tive to businesses andgovernment agencies inNorthwest Georgia. Thecompany ceased thatoperation nationallyin 2002.

Doug retired from Searsin 2003 after 32 yearswith the company.

He began writing novels shortly af-ter that. His novels are fiction …action, thrillers and fun fiction. Hisfirst book, It Was Thursday is shortby novel standards. Doug calls it theunnerving tale of an event thatshould never happen. But this storyshows us how it could, if it ever did.

Continued on page 7

CAST YOURVOTE!

2012 is a very important electionyear. This year is the United Statespresidential election that will takeplace on Tuesday, November 6,2012. Incumbent President BarackObama is running for a second term,and his presumptive Republicanchallenger will be former Massachu-setts Governor Mitt Romney.

As specified in the Constitution,the 2012 presidential election willcoincide with the United StatesSenate elections where one-thirdof the Senators will face re-elec-tion (33 seats), and the UnitedStates House of Representativeselections (which occurs every twoyears) to elect all of the membersfor the 113th Congress.

On Election Day we have the “power”to make changes in the laws thatgovern and dictate how corporationstreat retirees.

We should make it our business toknow which of the candidates for of-fice actually represent our prioritiesand do whatever we can to help getthat candidate elected.

We hope this year that you will alsocast your vote for N.A.R.S.E. and ei-ther renew your membership for2012 or join us.

N.A.R.S.E. needs your support tocontinue its mission of communica-tion with retirees and the media.Send your support by mailing yourcheck with the enclosed member-ship/renewal form today.

And don't forget to cast your voteon November 6 for the candidate ofyour choice.

according to chairman lampert: “we are moving from an era ... · fuel the company’s...

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