Monday, April 15, 2019

Sears Asks for More Time to File Chapter 11 Plan

Sears Holdings Corporation and its debtor affiliates, as debtors and debtors in possession in the above-captioned chapter 11 cases (collectively, the “Debtors” and, together with their non-debtor affiliates, “Sears” or the “Company”), file this motion (the “Motion”) for entry of an order further extending the periods during which the Debtors have the exclusive right to file a chapter 11 plan (the “Exclusive Filing Period”) and to solicit acceptances thereof (the “Exclusive Solicitation Period,” and together with the Exclusive Filing Period, the “Exclusive Periods”) by two (2) months through and including June 12, 2019 and August 13, 2019, respectively.

*The Debtors are seeking another modest extension of the Exclusive Periods at this critical juncture of their chapter 11 cases in furtherance of their fiduciary duties and to continue to try to broker a consensual chapter 11 plan among their various stakeholders. Despite receiving only a two-month initial extension of the Exclusive Periods pursuant to the first exclusivity order entered on February 15, 2019 (ECF No. 2626) (the “First Exclusivity Order”), the Debtors have made significant progress on a chapter 11 plan. Since the First Exclusivity Order was entered, the Debtors have drafted a proposed chapter 11 plan and accompanying disclosure statement and distributed the plan to their key stakeholders, including the Official Committee of Unsecured Creditors (the “Creditors’ Committee”), the Pension Benefit Guaranty Fund (the “PBGC”) and Cyrus Capital Partners, L.P (“Cyrus”). The Debtors have been working cooperatively with these parties and have conducted numerous calls and inperson meetings to negotiate the terms of the plan.

*Unfortunately, just over a month after obtaining approval of the sale transaction (the “Sale Transaction”) with Transform Holdco LLC (the “Buyer”) for substantially all of the Debtors’ assets, the Debtors have had to divert limited resources to take action to enforce the terms of the asset purchase agreement dated as of January 17, 2019 (as amended, “Asset Purchase Agreement”) against the Buyer to ensure that assets belonging to the Debtors’ estates are rightfully turned over to the Debtors. The Debtors have been pressing forward with their chapter 11 plan negotiations while simultaneously pursuing these assets. The outcome of this dispute will impact the analysis underpinning the plan, further bolstering the Debtors’ need for a modest extension of the Exclusive Periods.

1 comment:

Anonymous said...

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