HOFFMAN ESTATES, Ill.,
Jan. 23, 2018 /PRNewswire/ -- Sears
Holdings Corporation ("Holdings," "we," "us," "our," or the
"Company") (NASDAQ: SHLD) today announced that it intends to
commence exchange offers (the "Exchange Offers") pursuant to which
it would offer to (1) issue in exchange for its outstanding 8%
Senior Unsecured Notes Due 2019 ("8% Senior Notes") new 8% Senior
Unsecured Notes Due 2019, of a like principal amount, convertible
into common stock of the Company, at a conversion price of
approximately 120 shares per $1,000
in principal amount of indebtedness (or approximately $8.33 in principal amount per share), with
interest on such notes to be payable in kind at the Company's
option ("New 8% Senior Notes"), and (2) issue in exchange for its
outstanding 6 5/8% Senior Secured Notes Due 2018 ("6 5/8% Senior
Secured Notes") new 6 5/8% Senior Secured Notes Due 2019, of a like
principal amount, convertible into common stock of the Company, at
a conversion price of approximately 200 shares per $1,000 in principal amount of indebtedness (or
approximately $5 in principal amount
per share), with interest on such notes to be payable in kind at
the Company's option ("New 6 5/8% Senior Secured Notes"). The
New 8% Senior Notes and New 6 5/8% Senior Secured Notes would be
optionally convertible by the holders thereof, and would be
mandatorily convertible at the Company's option if the volume
weighted average trading price of the common stock on the NASDAQ
exceeds $10 for a prescribed
period.
The Company contemplates that the Exchange Offers would be made
under an exemption from the registration requirements of the
Securities Act of 1933, as amended (the "Securities Act"),
exclusively to certain accredited investors (as defined in Rule 501
of Regulation D under the Securities Act), and to certain non-U.S.
residents pursuant to Regulation S under the Securities Act, in
each case who are holders of 8% Senior Notes or 6 5/8% Senior
Secured Notes.
The Company also intends to pursue (1) an amendment with the
lenders thereunder, certain funds managed by ESL Investments, Inc.
or an affiliate thereof (the "Lenders"), of its outstanding
$300 million principal amount second
lien term loan to include a feature permitting the payment of
interest in kind at the Company's option and to provide that the
Company's obligation under the loan would be convertible into
common stock of the Company, on the same conversion terms as the
New 6 5/8% Senior Secured Notes, and (2) a negotiated exchange,
with certain third parties (the "Noteholders"), of
approximately $95 million in
principal amount of senior unsecured notes maturing between 2027
and 2043 and bearing interest at rates between 6.50% and 7.50% per
annum issued by the Company's subsidiary, Sears Roebuck Acceptance
Corp. (the "SRAC Notes"), for new unsecured notes (the "SRAC
Exchange Notes") maturing in March
2028, which would bear interest at a rate equal to 7.00% per
annum (which interest may be paid in kind at the option of the
Company at rate equal to 12.00% per annum). The SRAC Exchange Notes
would be guaranteed by the same subsidiaries of the Company which
guarantee the 6 5/8% Senior Secured Notes. The Company
contemplates that the negotiated exchange of the SRAC Notes would
be effected under an exemption from the registration requirements
of the Securities Act. The Lenders and Noteholders have each
indicated that they would expect to support the Exchange Offers and
the respective transactions described in this press release and
applicable to them.
The purpose of the Exchange Offers and the other contemplated
transactions described in this press release would be to enhance
the Company's liquidity.
This press release is issued pursuant to Rule 135c under the
Securities Act. This press release is neither an offer to
sell nor the solicitation of an offer to buy New 8% Senior Notes,
New 6 5/8% Senior Secured Notes or any other securities and shall
not constitute an offer, solicitation or sale in any jurisdiction
in which, or to any person to whom, such an offer, solicitation or
sale is unlawful. The securities referenced herein will not
be registered under the Securities Act and may not be offered or
sold without registration unless an exemption from such
registration is available.
About Sears Holdings Corporation
Sears Holdings
Corporation (NASDAQ: SHLD) is a leading integrated retailer focused
on seamlessly connecting the digital and physical shopping
experiences to serve our members - wherever, whenever and however
they want to shop. Sears Holdings is home to Shop Your Way®, a
social shopping platform offering members rewards for shopping at
Sears and Kmart as well as with other retail partners across
categories important to them. The company operates through its
subsidiaries, including Sears, Roebuck and Co. and Kmart
Corporation, with full-line and specialty retail stores
across the United States. For
more information, visit www.searsholdings.com.
Forward-Looking Statements
This press release contains
forward-looking statements intended to qualify for the safe harbor
from liability established by the Private Securities Litigation
Reform Act of 1995. Whenever used, words such as "will,"
"intends," "expects," and other terms of similar meaning are
intended to identify such forward-looking statements.
Forward-looking statements, including these, are based on the
current beliefs and expectations of our management and are subject
to significant risks, assumptions and uncertainties, many of which
are beyond the Company's control, that may cause our actual
results, performance or achievements to be materially different
from any future results, performance or achievements expressed or
implied by these forward-looking statements. Detailed descriptions
of other risks relating to Sears Holdings are discussed in our most
recent Annual Report on Form 10-K and other filings with the
Securities and Exchange Commission. While we believe that our
forecasts and assumptions are reasonable, we caution that actual
results may differ materially. We intend the forward-looking
statements to speak only as of the time made and do not undertake
to update or revise them as more information becomes available,
except as required by law.
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SOURCE Sears Holdings Corporation