HOFFMAN ESTATES, Ill.,
July 7, 2017 /PRNewswire/ -- Sears
Holdings Corporation (NASDAQ: SHLD) today announced that it has
entered into an amendment to its existing Second Lien Credit
Facility dated September 1,
2016. The amended credit facility provides an uncommitted
line of credit facility (the "Line of Credit Facility") under which
subsidiaries of the Company may from time to time borrow line of
credit loans ("Line of Credit Loans"), subject to applicable
borrowing base limitations, in an aggregate principal amount not to
exceed $500 million at any time
outstanding. Individual Line of Credit Loans under the Line of
Credit Facility are expected to have maturities of up to 179 days
and will be on pricing and other terms to be agreed with the
lenders that are or become party to the Second Lien Credit
Facility. Mr. Edward S. Lampert, the
Company's Chief Executive Officer and Chairman, is the sole
stockholder, chief executive officer and director of ESL
Investments, Inc. ("ESL"), which controls the Agent under the Line
of Credit Facility. ESL has indicated that it is considering
participating in the Line of Credit Facility as a lender, but ESL
is under no obligation to do so. The Company intends to discuss
additional Line of Credit Facility advances with additional lenders
from time to time.
"This facility is intended to provide the Company with the
flexibility to generate additional liquidity on an as-needed basis.
Any extensions of credit under this facility are collateralized by
a second lien on certain of our inventory, receivables and related
assets. This adjustment to our capital structure demonstrates that
Sears Holdings will continue to take actions to generate liquidity
and manage our business while meeting all of our financial
obligations," said Rob Riecker,
Sears Holdings' Chief Financial Officer.
Additionally, in June the Company closed on over $200 million of real estate transactions, which
resulted in a paydown of the April
2016 Real Estate Loan from $500
million to $347 million. These actions also increased
availability under the short term borrowing basket in the Company's
ABL credit facility, pursuant to which the Company can raise up to
$1.0 billion in loans that can mature
within the June 2020 ABL maturity.
After the partial loan repayment, the real estate loan will be
utilizing approximately $350 million
of the $1.0 billion basket compared
to $500 million previously.
Additional net proceeds of $57
million from the real estate transactions were used to
reduce the outstanding balance on our revolving credit
facility.
The terms of the Line of Credit Facility and, to the extent
funded by ESL, the initial Line of Credit Loans were approved by
the Related Party Transactions Subcommittee of the Board of
Directors of the Company, with advice from Centerview Partners and
Weil Gotshal & Manges, the Subcommittee's outside financial and
legal advisors.
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, including, but not limited to, statements about
our transformation through our integrated retail strategy, our
plans to redeploy and reconfigure our assets, our liquidity, our
ability to borrow under the Line of Credit Facility, which is
uncommitted, and our ability to exercise financial flexibility as
we meet our obligations. Whenever used, words such as "will,"
"intend," "expect," 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 risks,
uncertainties and factors 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.
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.
NEWS MEDIA CONTACT:
Sears Holdings Public
Relations
(847) 286-8371
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SOURCE Sears Holdings Corporation