Sears Holdings Corp. (fka SHLDQ)

[justthefactsmam]

linda,

you are probably one of the few who might read this link although you seem to have gone down this road for your research:

http://www.willamette.com/insights_journal/11/spring_2011_10.pdf

this article and what is going on is confusing for the following reasons:

yes, esl's purchase was a 363 sale which involved the purchase of (some) shc assets as opposed to shc stock.

the linked article seemed to suggest an either/or situation. purchase assets and take whatever benefit as a buyer you can derive from that purchase and leave seller with its stock and nol's, or purchase the stock of the selling corporation and take whatever nol's apply.

BUT, if you look at the language in the apa and ammendment, it appears buyer (esl/transform holdco) is attempting to have its cake and eat it too. esl/transform holdco indicates that while buying the assets under a 363 agreement, it is also attempting to structure this as a tax reorganization.

in point 6 of your comment in which you summarized your thoughts as to what you thought was correct, you said:

"the holdco securities that the debtors received as part of the sale price will either be liquidated or distributed to creditors first and lastly shareholders"

now look at page 148/155 of docket 2456 filed yesterday which addresses the securities the debtors are to receive. it says:

"as soon as practicable after closing, each seller, other than shc, shall distribute securities consideration, pursuant to distribution requirements to its EQUITY HOLDER(S) pursuant to the distribution requirement.

lampert/esl and subs of lampert/esl beneficially own either 48.5% or 49.5% (can't remember which one it is and don't want to go back to the filing to verify, but in either case, it is less than 50% of the stock), however, as discussed in the linked article, lampert/esl and the subs also are secured creditors of the debtors.

i also read somewhere that all of the "less than 5% owners in a bankruptcy" are grouped together as one group for bk consideration. not sure how that impacts "shift in ownership" if that were true.

if, as a creditor, can esl/lampert just control holdco based on its proposed exchange of the $1.3 billion debt for holdco stock, let all commons be wiped out yet still remain in control of holdco because of the stock for debt cancellation consideration?

head is swimming, still not sure i know how this plays out.