Earn-out Agreement

AMENDMENT
TO
EARN-OUT AGREEMENT


THIS AMENDMENT TO EARN-OUT AGREEMENT (this "Amendment") is made as of April 10, 2007 by and among Steven Madden, Ltd., a Delaware corporation, Daniel M. Friedman, Daniel M. Friedman & Associates, Inc. and DMF International, Ltd (each a "Company," and together the "Companies").


RECITALS
--------


WHEREAS, the parties hereto entered into that certain Earn-Out Agreement (the "Earn-Out Agreement"), dated as of February 7, 2006, and;


WHEREAS, Steven Madden, Ltd., a Delaware corporation and Daniel M. Friedman wish to shorten the term of the Earn-Out Agreement;


NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein and in the Earn-Out Agreement, the parties hereby agree as follows:


1. Section 1 Definitions of the Earn-Out Agreement are hereby
amended as follows:


The foregoing definition of "2007 Contingent Purchase Price Payment" is
added before the first definition. The "2007 Contingent Purchase Price
Payment" is defined to say:


"2007 Contingent Purchase Price Payment" shall have the
meaning set forth in section 2(a) hereof.


The definition of "2008 Contingent Purchase Price Payment" is hereby
deleted in its entirety and replaced as follows:


"2008 Contingent Purchase Price Payment" shall have the
meaning set forth in section 2(b) hereof.


The definitions of "2009 Contingent Purchase Price Payment" and "2010
Contingent Purchase Price Payment" are hereby deleted in their
entirety.


The definition of "Contingent Purchase Price Payment" is hereby deleted
in its entirety and replaced as follows:


"Contingent Purchase Price Payment" shall mean each of the
2007 Contingent Purchase Price Payment and the 2008 Contingent
Purchase Price Payment.


The definition of "Earn-Out Year" is hereby deleted in its entirety and
replaced as follows:


"Earn-Out Year" shall mean each of fiscal year 2007 and fiscal
year 2008, which shall end on December 31, 2007 and 2008,
respectively.


The definition of "Earn-Out Multiple" is hereby deleted in its entirety
and replaced as follows:


"Earn-Out Multiple" shall mean 3.64.


The definition of "EBITDA" is hereby deleted in its entirety and
replaced as follows:


"EBITDA" shall mean the Companies' (a) net sales, less,
without duplication, the sum of (i) cost of sales (including,
without limitation, any amounts which, absent the transactions
contemplated by the Stock Purchase Agreement, would have been
payable by Daniel M. Friedman & Associates, Inc. to the
Purchaser pursuant to the terms of the License Agreement (as
hereinafter defined) as if, with respect to such amounts, such
License Agreement is coterminous with this Agreement;
provided, that no royalty shall be payable for the sale of
Steven products in fiscal year 2007 and a 5% royalty shall be
payable for Steven products for fiscal year 2008 and,
therefore, in determining the royalty payable pursuant to the
License Agreement, Madden shall, (x) in 2007, subtract 10%
multiplied by the amount of any Steven product sold and (y) in
2008, subtract 5% multiplied by the amount of any Steven
product sold in order to effectuate the agreed upon royalty
amount, (ii) selling and distribution expenses, (iii) design
and production expenses and ...