Sears Holdings Corp. (fka SHLDQ)

[justthefactsmam]

Your statement that there is “SEC filing proof that Holdings Common Stock will be used in the near future: Conversion price: $5 for 200 shares in exchange for $1000 of debt” is not only misleading, but inaccurate.

You have chosen to make a mathematical calculation as to what the breakeven share price would need to be but that is not what the filing says. Instead the sec filing clearly states:
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Loan may be converted into shares of Holdings Common Stock at the option of an eligible holder at a conversion rate of 200 shares of Holdings Common Stock per $1,000 in principal amount of indebtedness outstanding under the Second Lien Term Loan (subject to adjustment)
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That indebtedness could be converted now and $1000 of indebtedness could be exchanged for 200 shares of shldq which at Friday’s closing price of $0.5801 would mean receiving stock worth slightly over $116 in exchange for giving up $1000 of a debt instrument.

Now, maybe it is possible that esl is making nice with these debtholders and indicating there could be an ipo of newco which could be exchanged for debt and it is possible that ipo would be priced at or in excess of $5/share which would make going along with esl’s bid a better bet for debtholders than challenging his offer in court and pushing for liquidation.

since part of esl's bid is extinguishing the debt owed to esl by shc, he needs to get those other debtholders on board. even extinguishing his debt allows esl to keep firm control of common shares.