July 10th
Some people, myself included, expected that SHLD was going to file Chapter 11 on July 10, 2017.
The reason is that they repaid a $500 million loan to ESL, controlled by the CEO of SHLD, and July 10 would have been beyond the two year look back period for preferred or preferential payments.
The thinking was that there was no reason to delay a Chapter 11 filing beyond that date since every day the company goes on, they lose more money. The equity was wiped out long ago, and now they will be cutting into other liabilities.
Anyone, especially vendors, that are shipping product to SHLD as unsecured liabilities has to be out of their minds, since the instant SHLD files chapter 11 they are going to take a big loss.
I do hold some put options that still may end up profitable since the stock seems to be sliding from above $8 to below $7 at record speed.
Louis J. Desy Jr.
