"Yes. A tax reorganization. Not a buy out. So again. Its the same f ing company."
therein seems to be the confusion.
sears holdings corporation (shc) and various of its subsidiary companies filed for bankruptcy. at the time those entities filed for bankruptcy they had a lot of f ing stuff. included in that stuff were a lot of properties, pension obligations, thousands of leases and contracts, pension obligations, a lot of debt and around 110 mm shares of outstanding stock.
along comes transform holdco which is 100% owned by eddie lampert. in exchange for $5.2 billion of consideration, transform holdco purchased substantially all of the "go-forward" assets of shc and it subsidiary compamies who jointly filed for bankruptcy. those assets included real estate, the tax attributes (nols and tax credits), and thousands of leases and contracts which were or have not yet been accepted or rejected by either shc and its subsidiaries which jointly filed for bankruptcy or transform holdco.
the deal for that transaction closed on february 11, 2019. transform holdco has until around april 12, 2019 to accept or reject those leases and contracts which were a part of the various sales transactions.
what's left are two distinct and vastly different entities. what i and others have referred to as "old sears", a term with which you take issue but for clarification seems appropriate. so that you can understand it and not be confused, i will continue in this post to refer to what was left behind after transform holdco purchased everything it purchased as shc and its other debtor subsidiaries. what lampert purchased will be called transform holdco.
sears and its other debtor subsidiaries now have left a number of stores and properties at which going out of business sales are being conducted. after those sales are complete, the properties and stores, if they were not ones purchased by transform holdco, will be sold or monetized in some fashion and the consideration received will be paid to those to whom shc and its debtor subsidiaries owe money.
sears and its debtor subsidiaries also owe a lot of debt to creditors which remained with them because all of the assets purchased by transform holdco were purchased and transferred free and clear of any of that debt. those remaining creditor obligations are the responsibility of shc and its debtor subsidiaries to pay off (probably at pennies on the dollar).
sears and its debtor subsidiaries also had pension obligations which did not pass to transform holdco. the pbgc stepped in and assumed control of those two pensions from sears and its debtor subsidiaries without any additional obligation on the part of transform holdco.
sears and its debtor subsidiaries have retained a large number of professional lawyers and advisors which are the source of the various administrative claims against the estate of shc and its debtor subsidiaries. the obligation for paying these administrative claims belongs to shc and its debtor subsidiaries.
because some of the debt of sears and its debtor subsidiaries has a super-priority claim status, those debts will be paid ahead of any administrative claims, which otherwise would have been first in line for reimbursement. interestingly, those super-priority claims belong to lampert entities.
the stock currently trading on the otc exchange as shldq has nothing to do with transform holdco. if you look at the asset purchase agreement the securities of shc and its debtor subsidiaries were specifically excluded from those assets which were purchased by transform holdco. hence, the transactions which were made by transform holdco constituted an asset sale by shc and its debtor subsidiaries to transform holdco, not a stock sale.
it was the structuring of the various transactions which gave rise to the situation referred to as a "tax reorganization" in the asset purchase agreement. the benefits of the "tax reorganization" accrue to transform holdco, not shc and its debtor subsidiaries.
what's left after transform holdco's transactions is one company, 100% owned by eddie lampert, that company being transform holdco, which owns what has been described above and another company composed of shc and its debtor subsidiaries, which "owns" all of the remaining debt and administrative claims as well as the obligation to pay for those things. additionally, shc and its debtor subsidiaries are REQUIRED by the terms of the asset purchase agreement to wind down and liquidate withing three taxable years from the closing of the transaction to transform holdco. it is for the above reasons that shc and its debtor subsidiaries are sometimes referred to as a "shell" or a "worthless shell".
lampert seems willing to walk away from the 55 +/- million shares of shldq stock he holds. in the larger scheme of things, paying himself and all others who own shldq stock doesn't seem to provide any upside but it certainly would mean assuming a lot of downside.
SO, WHEN YOU CLAIM ITS THE SAME F ING COMPANY, I'M AT A COMPLETE LOSS TO UNDERSTAND WHAT THE F YOU ARE TALKING ABOUT.
MAYBE, IF YOU EVEN UNDERSTAND IT, YOU COULD EXPLAIN IT TO US WHO DON'T.
THANKS
