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so, down 37% is on fire?
looks more like a rush to the exit
The company received court approval in April to access $1 billion in recently arranged financing. Fitch and Moody’s, two leading credit rating agencies, have assigned investment grade ratings to the financing transaction.
The company intends to use the court-supervised process to address obligations accelerated as a result of an adverse litigation decision issued on Feb. 15, 2019, by Judge Jesse Furman in the U.S. District Court of the Southern District of New York.
The company is evaluating all options as part of the Chapter 11 reorganization process regarding the master lease with Uniti Group, Inc., including renegotiation, recharacterization and rejection of the agreement.
win recorded over $500 million in segment income for the quarter ending 3/31
on the bad side, with the goodwill writedown, liabilities now exceed assets.
need to wait and see what can be crammed downed on the creditors to see how that deficit might play out.
the sears that "might" be coming back in 5 years is the sears owned 100% by transform holdco which is 100% owned by esl which is 100% owned by eddie lampert.
the sears on which you have gone "all in" is shldq which has absolutely nothing to do with the sears now owned by eddie.
you seem to be under a delusion there is some type of shared mutual interest in shldq shares and your "common sense" tells you that eddie would not just walk away from his shldq shares so that is why your "all in" position will be saved.
there is no mutual interest. eddie had a choice - buy the shares of the corporation (the shldq shares you both currently have) or buy the assests underlying those shares. he chose the latter. in doing so, he walked away from his shldq shares in exchange for obtaining the nols, tax credits, the real estate, intellectual property, and leaving behind all of the debt and other liabilities associated with shldq.
granted, there is a lawsuit against eddie but anything paid by eddie to make that go away or anything awarded to the plaintiffs at trial will just go to pay down the mountain of debt and there will still be nothing left which would provide any value to shldq shareholders.
don't know if you are even, above or below water on your "all in" position but your feelings that eddie is going to save you and the other common stockholders is misplaced.
you are holding on to a steamingstockpile and it might be good to turn it over before it completely decomposes.
that's why this transaction was called an "asset sale". he could have chosen to purchase the stock but instead he just chose to purchase the assets.
regarding the $35 million of common stock, NOT selling that stock is what permitted eddie to acquire billions of nol's plus almost a billion of mostly foreign tax credits.
if eddie sold his shares that would be considered a change in control and the nol's could not pass to eddie.
eddie already issued shares to shc (look at the apa) which were class b shares of transform holdco. that's the only share exchange there will be.
interesting article from the time of the filing:
https://www.bloomberg.com/opinion/articles/2019-02-27/windstream-bankruptcy-will-destroy-value-eliminate-profits
also an interesting article from lsta. did anybody tune in to their webinar on march 6?
https://www.lsta.org/news-and-resources/news/unraveling-windstream
exactly what benefit is there for eddie issuing new common to old common?
why would he even need to do that?
the old common stock he owns is worth no more than $35 million or so at these prices.
he owns all of the valuable sears assets (100% controlled in his private company transform holdco) and he has no responsibility for the old debt or pensions.
what value is there is getting a bunch of whining common stock shareholder with a new issuance?
suggesting new common stock issuance is either not well thought through or i'm missing something pretty basic.
any rational thoughts on why issuing new stock makes sense are welcome.
when the current por was put forward, it was done so with the explicit comment it was the "best deal" and that if the por was rejected, anything else would be worse than what was being proposed.
so, it would appear if not enough voters like the current por, they will really not like what might follow.
my bet would be if the current por is rejected that judge drain would dismiss the case or throw it into chapt 7.
following is a cut/paste explanation:
The inability of a debtor in bankruptcy to pay its administrative expenses, such as attorneys' and other professional fees. Administrative claims must be paid in full as a condition to confirmation of a Chapter 11 plan of reorganization, unless administrative creditors agree to less than full payment. Therefore, administrative insolvency usually results in conversion of the case to a Chapter 7 liquidation or a dismissal of the case.
in response to your question "who, if anyone, would benefit...?" my answer would be the lawyers, as usual.
there have been recent filings which indicate there are past due administrative claims. one reason shc had for these delinquent claims was that transform was withholding money due shc under the asset purchase agreement.
the recent monthly operating report contained nothing which would indicate any hope this stock is going to do anything other than become worthless.
there was also a docket filed in the last couple of days in which judge drain ruled (largely against transform) on the outstanding motion to require transform to pay the disputed amounts owed to shc.
despite the fantasy arguments that sch will collect so much money from esl/eddie that commons will be "saved" or that eddie will sell his common shares to help pay his legal costs, based on the filings can not see anyway this stock does anything but go to zero.
so little volume recently that the flipping ability is risky at this point. writing is on the wall but it appears some have a hard time reading and comprehending. unfortunate that dd for some seems to be limited to pop psych about why eddie wouldn't walk away from his shares.
disclosure statement hearing postponed until may 29. docket # 3770
probably, and for all other parties as well
they're also past due on $49 million of payments to creditors. so, there are more outflows than just legal payments.
if judge drain is not happy with both sides when they next meet, it wouldn't surprise me to see him dismiss this case and let everybody fight it out in various courts without the protection bankruptcy court provides.
in shldq's monthly operating report (MOR), they state that almost $50 million of payments due creditors is delinquent. in the current reporting period, shldq also report over $37 million in legal fees which brings the total legal fees paid to date to just over $90 million.
administrative involvency looks to be a real risk as was cautioned by judge drain when he approved the asset sale agreement.
sec filing monday morning states otherwise:
As previously reported in a Form 12b-25 filed on April 18, 2019, the Company will not file an Annual Report on Form 10-K for the fiscal year ended February 2, 2019 or any quarterly reports on Form 10-Q for subsequent periods ended prior to the confirmation of the Plan of Liquidation
risks related to the trading of the Company’s common stock and warrants on the OTC Pink Market, particularly because the Plan of Liquidation states that there will not be sufficient funds or other assets in the Estate to allow holders of the Company’s common stock or warrants to receive any distribution of value in respect of their equity interests; risks relating to the Company’s ability to confirm the Plan of Liquidation;
https://www.sec.gov/Archives/edgar/data/1310067/000119312519137141/d736916d8k.htm
as of april 6, total deficit is over $6.6 billion
https://www.sec.gov/Archives/edgar/data/1310067/000119312519137141/d736916dex991.htm
maybe it has something to do with the fact newco has no debt, unlike "old sears" which is holding the bag on over $5 billion of debt.
doesn't seem too surprising at all LOL!
Windstream intends to use the court-supervised process to address debt maturities that were accelerated as a result of a decision by Judge Jesse Furman in the Southern District of New York against Windstream Services, LLC, issued on February 15, 2019.
Effective February 19, 2019, Windstream, Windstream Services and Tony Thomas entered into an employment agreement (the “Employment Agreement”) that replaced and superseded the previous employment agreement dated September 1, 2017, between Mr. Thomas and Windstream which was scheduled to expire on December 31, 2019. The Employment Agreement provides that Mr. Thomas will be employed as President and CEO and serve on the Board of Directors from February 19, 2019 to March 1, 2024, subject to annual renewals thereafter. During the employment period, Mr. Thomas’ annual base salary will not be less than $1,000,000 and his target annual bonus opportunity will not be less than 188% of his base salary. On February 19, 2019, as consideration for execution of the Employment Agreement, Mr. Thomas received a one-time, time-based cash award of $2,000,000 that will vest in full on the third anniversary of the date of grant. Mr. Thomas is also eligible to participate in all equity incentive, employee benefits and perquisite plans, programs and arrangements that are no less favorable to Mr. Thomas than the plans, programs and arrangements provided to other senior executives of Windstream Holdings.
Based upon information contained in a Schedule 13G/A filed on February 11, 2019, The Vanguard Group has sole voting power over 36,664 shares, shared voting power over none of the shares, sole dispositive power over 2,962,390 shares and shared dispositive power over 36,664 shares.
so, according to the amended annual report, vanguard is still listed as a 5% owner.
jack, what exactly is it you are seeing in the linked documents which makes you think the common stock will be cancelled?
did you even read the document?
do you even know what is meant by a declaration of worthlessness?
no, didn't think so.
suggest you go back and read docket #5 and work forward from there.
eddie got what he wanted. he doesn't need worthless common shares.
when the moass doesn't materialize, you might be happy to have that toilet paper.
taking a snippet from your quote:
"I think all ICIs are destined to be doomed. Never play against the nature"
"nature" might be brought back in with the combination of oncolytic viruses which have shown some promise priming the immune system when combined with treatments such as keytruda.
not sure there will ever be "the" silver bullet. seems there will be a lot of places at the table for individualized treatment.
The store is not profitable, according to Transform Holdco, which purchased Sears out of bankruptcy.
"As part of Sears Holdings' bankruptcy proceedings, our go-forward company, Transform Holdco LLC, has the right not to acquire various contracts that were entered into by Sears Holdings," a Sears spokesperson said in a statement to Business Insider. "As such, Transform Holdco decided not to acquire the current lease for the unprofitable Sears store at Oakbrook Center and the store will close on April 28."
On April 17, 2019, the Debtors filed their Joint Chapter 11 Plan of Reorganization and the Disclosure Statement related thereto. The Bankruptcy Court will hold a hearing to consider approval of the Disclosure Statement on May 16, 2019.
yeah, eddie sells his commons and loses the nols. smart.
no so much. this was filed over a week ago and you have seen the reaction. low volume and a realization the plan and disclosure statement stated the shares would be declared worthless with one class of debtors receiving 100% of their claims to be paid in cash and another to receive cash for 100% of the approved amount of their claim.
to the extend the litigation against eddie and the others result in any recoveries, that will go to make debtors whole leaving the common shareholders with nothing.
there is probably a good dictionary out there which virtually anyone could access and finally understand what "nothing" and "worthless" actually mean.
will be interesting to see how the indemnification and exculpation arguments go. not interested enough to research it but am sure both shc and the defendants will be looking at the corporate bylaws about how those issues are addressed re: fronting or reimbursing legal fees for d&o's who are sued. seems to put sears in a bind as the company suing who will not want to "honor" those provisions in their bylaws. still think the insurer is going to be dragged into this.
maybe bar can weigh in but suppose it is possible they did it after filing the liquidation plan to keep them out of chapter 7 or being declared administratively insolvent.
if shc can convince the judge there is a possibility of getting any recovery for the estate via this lawsuit, then drain might keep them in the current chapt 11 case to see how it plays out.
while any recoveries would just go to pay debts and still leave nothing for shareholders, that might be enough incentive to keep the case where it is.
if drain were to force this to chapt 7 liquidation with the appointment of a trustee, might that possibly render the suit against esl and the various parties moot?
if they are going into chapt 7, that would seem to indicate there is no "shc" to bring suit.
could an appointed trustee of a chapt 7 case take up the suit?
bar, you're the bk lawyer. what say you?
i'm curious why shc didn't also name it d&o insurance company as a party. have to believe the officers and directors who are being sued will bring a counter claim against the insurance company to indemnify them.
can anyone say FUBAR?
how long are you willing to wait?
how much is fools gold worth?
dragon, now that we have seen a por, do you still think there will be an exchange of new shares for old?
they know how has the nol's. sears retained the portion of the nols associated with the cancellation of debt to esl. also, sears retains nols after the closing date of the sale (february 11, 2019). holdco owns the remaining nol's and tax credits (subject to a favorable irs ruling the asset purchase agreement met the standards as described in the apa in accordance with tax law)
so, assume the irs doesn't rule for holdco then the specific language in the apa provides that els will basically "reject" the nols which would then remain with shc and its debtor subsidiaries.
$6 billion of nols is NOT $6 billion of value. if shc sells its remaining assets to pay creditors and administrative claims and experiences a tax basis gain on those sales, it wouldn't have to pay taxes on a portion of those gains.
the nols are not taken 1 for 1. in other words, they don't get to reduce 1 dollar in taxes for 1 dollar in nols. the value of the nols is just around 15% or so of their face value.
bottom line, shc and its debtor subsidiaries would realize an actual tax benefit of something along the order of $1.5 billion.
that tax benefit does not dig them out of the hole and they are still bankrupt and the common stock is still worthless.
if the existing plan does not get approved, there are two options: submit a new plan and hope it gets approved or liquidate under chapt 7. if this was the best plan shc and its debtor subsidiaries could present, then it seems implausible a lesser plan would get approved.
so, if you are holding shldq then yes, pray for a manuractured MOASS and get YOASS out of shldq and don't look back.
your only hope if you are currently underwater in shldq is to hope someone is uninformed enough to hit the buy button when you want to sell. glta because at this point luck is all you have.
four new sec filings. don't bother to read if you own this stock because it's probably all fake news:
https://www.sec.gov/Archives/edgar/data/1310067/000119312519111056/d738097d1515d.htm
https://www.sec.gov/Archives/edgar/data/1310067/000119312519111058/d738097d1515d.htm
https://www.sec.gov/Archives/edgar/data/1310067/000119312519111066/0001193125-19-111066-index.htm
https://www.sec.gov/Archives/edgar/data/1310067/000119312519111075/0001193125-19-111075-index.htm
one class is getting 100% of what it is owned paid in cash.
another class is getting 100% of what was approved paid in cash.
yeah, wonder how they are going to vote.
a real mystery
sears net operating losses and tax credits:
Debtors estimate that, as of the Commencement Date, the SHC Tax Group had consolidated net operating losses (“NOLs”) of approximately $6 billion, among other tax attributes (including tax basis in assets).
However, in accordance with the Asset Purchase Agreement, a substantial portion of such NOLs and certain of their other tax attributes are expected to be transferred to Transform as a result of the Sale Transaction (in combination with the subsequent liquidation of the Debtors) qualifying as one or more reorganizations for U.S. federal income tax purposes, subject to reduction with respect to any item of cancellation of debt (“COD”) incurred by such Debtors in the taxable year of the Sale Transaction or
afterwards.
MOASS, YOASS, DUMBASS
imagine that, velvet.
who could ever have figured out something like that without being a lawyer specializing in bankruptcy.
the articles from the wsj and bloomberg must all have been fake news and those authors must have had some type of agenda.
don't you imagine those reporters were short shldq?
fake news, deep state, bs.
i wonder what agenda shc must have in saying something so inflammatory in a legal filing. do you think they might be trying to tell common shareholders their shares will be worthless? who's going to believe that?
boy, they have a lot of nerve. doesn't that mean that eddies shares are worthless as well?
yes, but you know, this is just some bs legal document required to be filed in accordance with bk rules and is probably all FAKE NEWS.
still don't see any shares for sale on craig's list or etsy.
the “Debtors”) propose the following joint chapter 11 plan of liquidation
pursuant to section 1121(a) of the Bankruptcy Code. Capitalized terms used herein shall have the meanings set forth in Article I.A.
(iv) exercise its reasonable business judgment to direct and control the wind down, liquidation, sale and/or abandoning of the remaining Assets of the Debtors under the Plan and in accordance with applicable law as necessary to maximize Distributions to holders of Allowed Claims;
“Wind Down” means, the process of winding down, dissolving, and liquidating the Estates and their Assets in accordance with the Plan.
make Distributions to Holders of Allowed Claims as set forth in, and
implement the Wind Down pursuant to, the Plan;
(iv) exercise its reasonable business judgment to direct and control the wind down, liquidation, sale and/or abandoning of the remaining Assets of the Debtors under the Plan and in accordance with applicable law as necessary to maximize Distributions to holders of Allowed Claims;
(xiii) prepare and file on behalf of the Debtors and any non-Debtor
subsidiaries, certificates of dissolution and any and all other corporate and company documents necessary to effectuate the Wind Down without further action under applicable law, regulation, order, or rule, including any action by the stockholders, members, the board of directors, or board of directors or similar governing body of the
Debtors;
Section 11.10 of the Plan: Limitations on Executable Assets with Respect to the D&O Claims
Any recovery by or on behalf of the Liquidating Trust (and the beneficiaries thereof) on account of any Preserved Cause of Action against any of the Specified Directors and Officers, solely in his or her capacity as a director of the Debtors prior to the Effective Date, or officer of the Debtors prior to the closing of the Sale Transaction, as applicable, including in each case by way of settlement or judgment, shall be limited to the Debtors’ available D&O Policies’ combined imits, after payment from such D&O Policies of any and all covered costs and expenses incurred by the covered parties in connection with the defense of any D&O Claim (the “Insurance Coverage”). No party, including the
Liquidating Trustee, shall execute, garnish or otherwise attempt to collect on any settlement of or judgment in the D&O Claims upon any assets of the Specified Directors and Officers except to the extent
necessary to trigger the Insurance Coverage. In the event Insurance Coverage is denied for any settlement or judgment in the Liquidating Trust’s favor, the Specified Directors and Officers shall assign any claims for coverage or other rights of recovery they may have against the D&O Policy insurers to the Liquidating Trust
bar,
putting aside the yippee feeling that lawyers are going to make a lot of money bringing suit against lampert, how do you view this?
seems from what i have read that all of the actions shc is now taking against lampert were actually approved by the bod and possibly outside consultants.
wouldn't lampert have some type of counter suit against the insurance company providing D&O coverage? realize it's better to bring suit against a party who has money than one who doesn't (nuisance action hoping for settlement), but this seems like an uphill battle to me.
i worked for sears in the late 80's early 90's and they were on a downward spiral then. its not a matter of dispute that sears needed money and eddie provided it. have no love lost for eddie but guess, while this suit was not an unforeseen action, it just seems a little misplaced.
from the plan of reorganization for sears holdings filed yesterday:
well, this is only an opinion, and is just from the court filed plan but what the hey, it's probably just fake news.
class 1 claims will be paid 100% in cash. interesting because i'm certain that must be incorrect because they were in line to get shares. hmmm, maybe they know something. MOASS coming!
class 2 claims will be paid in cash for 100% of their allowed claim. wow, really thought they were getting shares as well in exchange for their debt. who the hell would want cash in the full amount of their approved claim? they certainly are not thinking outside of the box and guess they are not one of the privileged few who are in the know. MOASS coming!
guess with all of the share still available will continue looking on craig's list and etsy. july is the final approval time frame so plenty of time for the stock to start trading on craig's list or etsy. wonder if stock traded there has to be registered?
i'm sure eddie will know what to do when it comes time to dump his shares. will just have to trust in him becasue HE'S DA MAN!
there is an omnibus hearing today with judge drain. i am certain he will let everybody know, in no uncertain terms, that sears in an american icon and that eddie has a plan. after all, drain said eddie was a smart billionaire and could look out for himself. hope he doesn't make it so clear that even those who don't read believe him or else my financing arrangements of this morning might go to waste. keeping an eye on craig's list and etsy but nothing there yet. maybe once the rush to the exit occurs it will show up.
this could be part of the reason for recent stock $ movement.
Our common stock is considered a “penny stock,” which is likely to limit its liquidity and make it more difficult for us to raise additional capital in the future.
The market price of our common stock is, and will likely remain for the foreseeable future, less than $5.00 per share, and therefore will be a “penny stock” according to SEC rules, unless our common stock is listed on a national securities exchange.
We do not expect to pay dividends on our common stock.
We have no plans to pay dividends on our common stock for the foreseeable future. Because we do not plan to pay dividends on our common stock, our stock may be less attractive to some investors, which could adversely affect our stock price.