HOFFMAN ESTATES, Ill.,
April 8, 2016 /PRNewswire/
-- Sears Holdings Corporation (the "Company") (NASDAQ: SHLD)
announced today that certain of its subsidiaries (the "Borrowers")
have entered into a 15 month $500
million committed secured loan facility (the "Loan
Facility") maturing in July 2017.
$250 million was funded under the
Loan Facility today and up to an additional $250 million may be drawn by the Borrowers in the
future. The Loan Facility, together with the previously announced
$750 million Term Loan, will provide
the Company with additional financial flexibility as it executes on
its transformation to a more asset-light integrated retailer
leveraging its membership based Shop Your Way®
program.
"We have an asset rich portfolio which provides us with numerous
options to finance our transformation strategy," said Robert A. Schriesheim, Executive Vice President
and Chief Financial Officer for Sears Holdings. "The expected
closing today of the previously announced $750 million Term Loan, together with this
$500 million facility, provides
$1.25 billion of committed financing.
When considered together with our previously announced intention to
monetize at least $300 million of
assets, this set of actions would result in an aggregate of
$1.5 billion of enhanced liquidity.
As we have consistently demonstrated, we will continue to take
actions to adjust our capital structure and manage our business to
enable us to execute on our transformation while meeting all of our
financial obligations."
The Loan Facility is secured by mortgages on 13 real properties
owned by the Company's subsidiaries and will be secured by an
additional eight real properties beginning on the date any
additional amounts are drawn. The Loan Facility bears interest at a
rate of 8% per annum and is guaranteed by the Company.
Under the terms of the Loan Facility, the Company is required to
retain a broker and use commercially reasonable efforts to
syndicate the Loan Facility. Eastdil Secured has been engaged by
the Company to manage the syndication. Any lender who provides a
portion of the Loan Facility as part of the syndication will be
entitled to share (based on loan amount and time outstanding) in
the origination and funding fees. Entities affiliated with ESL
Investments, Inc., on the one hand, and Cascade Investment, L.L.C.,
on the other, each provided $125
million of the initial $250
million drawn under the Loan Facility and have committed to
provide any portion of the Loan Facility that is not syndicated to
other lenders. Edward S.
Lampert, the Company's Chief Executive Officer and Chairman,
controls ESL Investments, Inc.
The terms of the Loan Facility 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
statements about our intention to obtain the remaining $250 million in advances contemplated by the Loan
Facility and our intention to monetize certain assets.
Forward-looking statements are subject to risks and uncertainties
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. Such statements are based upon the current beliefs and
expectations of our management and are subject to significant risks
and uncertainties. Factors that could cause actual results to
differ from those set forth in the forward-looking statements
include, but are not limited to, those discussed in this release
and those discussed in our most recent Annual Report on Form 10-K
and other filings with the Securities and Exchange Commission. 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