SC 13D/Amendment No. 63

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

Sole Voting Power

50,725,568 (1)

Shared Voting Power

0

Sole Dispositive Power

50,725,568 (1)

Shared Dispositive Power

99,971,670 (2)

0001193125-18-125918.txt : 20180423 0001193125-18-125918.hdr.sgml : 20180423 20180423080703 ACCESSION NUMBER: 0001193125-18-125918 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20180423 DATE AS OF CHANGE: 20180423 GROUP MEMBERS: EDWARD S. LAMPERT GROUP MEMBERS: ESL INVESTMENTS, INC. GROUP MEMBERS: JPP II, LLC GROUP MEMBERS: JPP, LLC GROUP MEMBERS: RBS PARTNERS, L.P. GROUP MEMBERS: SPE I PARTNERS, LP GROUP MEMBERS: SPE MASTER I, LP SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: SEARS HOLDINGS CORP CENTRAL INDEX KEY: 0001310067 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-DEPARTMENT STORES [5311] IRS NUMBER: 201920798 STATE OF INCORPORATION: DE FISCAL YEAR END: 0201 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-80635 FILM NUMBER: 18767973 BUSINESS ADDRESS: STREET 1: 3333 BEVERLY ROAD CITY: HOFFMAN ESTATES STATE: IL ZIP: 60179 BUSINESS PHONE: 847-286-2500 MAIL ADDRESS: STREET 1: 3333 BEVERLY ROAD CITY: HOFFMAN ESTATES STATE: IL ZIP: 60179 FORMER COMPANY: FORMER CONFORMED NAME: Sears Holdings CORP DATE OF NAME CHANGE: 20041129 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: ESL PARTNERS, L.P. CENTRAL INDEX KEY: 0000923727 IRS NUMBER: 222875193 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 1170 KANE CONCOURSE STREET 2: SUITE 200 CITY: BAY HARBOR STATE: FL ZIP: 33154 BUSINESS PHONE: 305-702-2100 MAIL ADDRESS: STREET 1: 1170 KANE CONCOURSE STREET 2: SUITE 200 CITY: BAY HARBOR STATE: FL ZIP: 33154 FORMER COMPANY: FORMER CONFORMED NAME: ESL PARTNERS LP DATE OF NAME CHANGE: 19940524 SC 13D/A 1 d575962dsc13da.htm SC 13D/AMENDMENT NO. 63 SC 13D/Amendment No. 63

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 63) *

Sears Holdings Corporation

(Name of Issuer)

Common Shares

(Title of Class of Securities)

812350106

(CUSIP Number)

Janice V. Sharry, Esq.

Haynes and Boone, LLP

2323 Victory Avenue, Suite 700

Dallas, Texas 75219

(214) 651-5000

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

April 20, 2018

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ☐

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

*	The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP No. 812350106


1.		Names of Reporting Persons. ESL Partners, L.P.
2.		Check the Appropriate Box if a Member of a Group (See Instructions) (a) ☒ (b) ☐
3.		SEC Use Only
4.		Source of Funds (See Instructions) OO
5.		Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6.		Citizenship or Place of Organization Delaware

(1)

Includes 4,808,465 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Warrants held by Partners, 680,209 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Senior Secured Convertible PIK Toggle Notes held by Partners, 6,231,180 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Senior Unsecured Convertible PIK Toggle Notes held by Partners, and 18,813,200 shares of Holdings Common Stock that JPP II has the right to acquire within 60 days pursuant to the Second Lien Term Loan.

(2)

Includes 32,717,912 shares of Holdings Common Stock held by Mr. Lampert, 6,328,688 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Warrants held by Mr. Lampert, 3,452,290 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Senior Secured Convertible PIK Toggle Notes held by Mr. Lampert, 16,285,980 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Senior Unsecured Convertible PIK Toggle Notes held by Mr. Lampert, and 41,186,800 shares of Holdings Common Stock that JPP has the right to acquire within 60 days pursuant to the Second Lien Term Loan.

(3)

Based upon 107,957,410 shares of Holdings Common Stock outstanding as of March 16, 2018, as disclosed in Holdings’ Annual Report on Form 10-K for the fiscal year ended February 3, 2018, that was filed by Holdings with the SEC on March 23, 2018, 4,808,465 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Warrants held by Partners, 680,209 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Senior Secured Convertible PIK Toggle Notes held by Partners, 6,231,180 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Senior Unsecured Convertible PIK Toggle Notes held by Partners, 18,813,200 shares of Holdings Common Stock that JPP II has the right to acquire within 60 days pursuant to the Second Lien Term Loan, 41,186,800 shares of Holdings Common Stock that JPP has the right to acquire within 60 days pursuant to the Second Lien Term Loan, 6,328,688 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Warrants held by Mr. Lampert, 3,452,290 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Senior Secured Convertible PIK Toggle Notes held by Mr. Lampert, and 16,285,980 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Senior Unsecured Convertible PIK Toggle Notes held by Mr. Lampert.

CUSIP No. 812350106


1.		Names of Reporting Persons. JPP II, LLC
2.		Check the Appropriate Box if a Member of a Group (See Instructions) (a) ☒ (b) ☐
3.		SEC Use Only
4.		Source of Funds (See Instructions) OO
5.		Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6.		Citizenship or Place of Organization Delaware

(1)	Includes 18,813,200 shares of Holdings Common Stock that JPP II has the right to acquire within 60 days pursuant to the Second Lien Term Loan.

(2)	Includes 41,186,800 shares of Holdings Common Stock that JPP has the right to acquire within 60 days pursuant to the Second Lien Term Loan.

(3)

CUSIP No. 812350106


1.		Names of Reporting Persons. SPE I Partners, LP
2.		Check the Appropriate Box if a Member of a Group (See Instructions) (a) ☒ (b) ☐
3.		SEC Use Only
4.		Source of Funds (See Instructions) OO
5.		Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6.		Citizenship or Place of Organization Delaware

(1)	Based upon 107,957,410 shares of Holdings Common Stock outstanding as of March 16, 2018, as disclosed in Holdings’ Annual Report on Form 10-K for the fiscal year ended February 3, 2018, that was filed by Holdings with the SEC on March 23, 2018.

CUSIP No. 812350106


1.		Names of Reporting Persons. SPE Master I, LP
2.		Check the Appropriate Box if a Member of a Group (See Instructions) (a) ☒ (b) ☐
3.		SEC Use Only
4.		Source of Funds (See Instructions) OO
5.		Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6.		Citizenship or Place of Organization Delaware

(1)	Based upon 107,957,410 shares of Holdings Common Stock outstanding as of March 16, 2018, as disclosed in Holdings’ Annual Report on Form 10-K for the fiscal year ended February 3, 2018, that was filed by Holdings with the SEC on March 23, 2018.

CUSIP No. 812350106


1.		Names of Reporting Persons. RBS Partners, L.P.
2.		Check the Appropriate Box if a Member of a Group (See Instructions) (a) ☒ (b) ☐
3.		SEC Use Only
4.		Source of Funds (See Instructions) OO
5.		Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6.		Citizenship or Place of Organization Delaware

(1)

(2)

(3)

CUSIP No. 812350106


1.		Names of Reporting Persons. ESL Investments, Inc.
2.		Check the Appropriate Box if a Member of a Group (See Instructions) (a) ☒ (b) ☐
3.		SEC Use Only
4.		Source of Funds (See Instructions) OO
5.		Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6.		Citizenship or Place of Organization Delaware

(1)

(2)

(3)

CUSIP No. 812350106


1.		Names of Reporting Persons. JPP, LLC
2.		Check the Appropriate Box if a Member of a Group (See Instructions) (a) ☒ (b) ☐
3.		SEC Use Only
4.		Source of Funds (See Instructions) OO
5.		Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6.		Citizenship or Place of Organization Delaware

(1)	Includes 41,186,800 shares of Holdings Common Stock that JPP has the right to acquire within 60 days pursuant to the Second Lien Term Loan.

(2)

CUSIP No. 812350106


1.		Names of Reporting Persons. Edward S. Lampert
2.		Check the Appropriate Box if a Member of a Group (See Instructions) (a) ☒ (b) ☐
3.		SEC Use Only
4.		Source of Funds (See Instructions) OO; PF
5.		Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6.		Citizenship or Place of Organization United States

(1)

(2)

(3)

This Amendment No. 63 to Schedule 13D (this “Amendment”) relates to common shares, par value $0.01 per share (the “Holdings Common Stock”), of Sears Holdings Corporation, a Delaware corporation (“Holdings”). This Amendment amends the Schedule 13D, as previously amended, filed with the Securities and Exchange Commission by ESL Partners, L.P., a Delaware limited partnership (“Partners”), JPP II, LLC, a Delaware limited liability company (“JPP II”), SPE I Partners, LP, a Delaware limited partnership (“SPE I”), SPE Master I, LP, a Delaware limited partnership (“SPE Master I”), RBS Partners, L.P., a Delaware limited partnership (“RBS”), ESL Investments, Inc., a Delaware corporation (“ESL”), JPP, LLC, a Delaware limited liability company (“JPP”), and Edward S. Lampert, a United States citizen, by furnishing the information set forth below. Except as otherwise specified in this Amendment, all previous Items are unchanged. Capitalized terms used herein which are not defined herein have the meanings given to them in the Schedule 13D, as previously amended, filed with the Securities and Exchange Commission (“SEC”).

Item 3. Source and Amount of Funds or Other Consideration.

Item 3 is hereby amended and supplemented as follows:

“In a grant of shares of Holdings Common Stock by Holdings on March 30, 2018, pursuant to the Extension Letter between Holdings and Mr. Lampert, Mr. Lampert acquired an additional 159,575 shares of Holdings Common Stock. Mr. Lampert received the shares of Holdings Common Stock as consideration for serving as Chief Executive Officer, and no cash consideration was paid by Mr. Lampert in connection with the receipt of such shares of Holdings Common Stock.”

Item 4. Purpose of Transaction.

Item 4 is hereby amended and supplemented as follows:

“On December 13, 2017, Holdings, through the LC Borrowers, entities wholly-owned and controlled, directly or indirectly by Holdings, entered into a Fourth Amendment (the “Fourth LC Facility Amendment”) to the Amended LC Facility Agreement, with the LC Lenders and other lenders party thereto from time to time and the Issuing Bank, as administrative agent and issuing bank. The Fourth LC Facility Amendment modified the definition of “Default Rate” under the Amended LC Facility Agreement.

The foregoing description of the Fourth LC Facility Amendment does not purport to be complete and is qualified in its entirety by reference to the Fourth LC Facility Amendment, attached hereto as Exhibit 99.63 and incorporated by reference herein.

On February 13, 2018, Holdings, through the LC Borrowers, entities wholly-owned and controlled, directly or indirectly by Holdings, entered into a Fifth Amendment (the “Fifth LC Facility Amendment”) to the Amended LC Facility Agreement, with the LC Lenders and other lenders party thereto from time to time and the Issuing Bank, as administrative agent and issuing bank. The Fifth LC Facility Amendment added additional LC Lenders to the Amended LC Facility Agreement and modified the terms for the consummation of a cashless offer to exchange any outstanding Permitted Debt (as defined in the Amended LC Facility Agreement) for new Permitted Debt.

The foregoing description of the Fifth LC Facility Amendment does not purport to be complete and is qualified in its entirety by reference to the Fifth LC Facility Amendment, attached hereto as Exhibit 99.64 and incorporated by reference herein.

On April 20, 2018, Holdings, through the LC Borrowers, entities wholly-owned and controlled, directly or indirectly by Holdings, entered into a Sixth Amendment (the “Sixth LC Facility Amendment”) to the Amended LC Facility Agreement , with the LC Lenders and other lenders party thereto from time to time and the Issuing Bank, as administrative agent and issuing bank.

The Sixth LC Facility Amendment extends the maturity of the $271 million commitment under the existing LC Facility from its existing maturity date of December 28, 2018 through December 28, 2019. To secure their obligation to participate in letters of credit issued under the LC Facility, the LC Lenders are required to maintain cash collateral on deposit with the Issuing Bank in an amount equal to 102% of the commitments under the LC Facility (the “Lender Deposit”), and in connection with the maturity extension, the LC Borrowers paid the LC Lenders an upfront fee equal to 0.50% of the aggregate amount of the Lender Deposit. The Sixth LC Facility Amendment also requires the LC Borrowers to pay a fee equal to 0.50% of the aggregate amount of the Lender Deposit in connection with the termination of the LC Facility, whether at maturity or otherwise, or of any reduction in the amount of the LC Lenders’ commitments under the LC Facility.

The foregoing description of the Sixth LC Facility Amendment does not purport to be complete and is qualified in its entirety by reference to the Sixth LC Facility Amendment, attached hereto as Exhibit 99.65 and incorporated by reference herein.

On April 13, 2018, the Mezzanine Loan Borrower, JPP and JPP II and any other lenders from time to time (collectively, the “Mezzanine Loan Lenders”) and JPP, LLC, as administrative agent, entered into a First Amendment (the “First Mezzanine Loan Amendment”) to the Mezzanine Loan Agreement (as amended, the “Mezzanine Loan Agreement”). Pursuant to the First Mezzanine Loan Amendment, the Mezzanine Loan Lenders made an additional advance to the Mezzanine Loan Borrower in the aggregate amount of approximately $66.6 million, which amount was secured by the same pledge of equity interests in SRC O.P. LLC (the “Mezzanine Loan Collateral”), the direct parent company of the entities that own the 138 real properties that secure the obligations of the 2018 Secured Loan Borrowers under the 2018 Credit Agreement. JPP and/or JPP II, as Mezzanine Loan Lenders, have syndicated and/or participated a portion of the Mezzanine Loans they provided under the Mezzanine Loan Agreement and may further syndicate or participate all or an additional portion of the Mezzanine Loans from time to time to unaffiliated third parties on the same terms.

On April 20, 2018, the Mezzanine Loan Borrower, the Mezzanine Loan Lenders and JPP, LLC, as administrative agent, entered into a Second Amendment (the “Second Mezzanine Loan Amendment”) to the Mezzanine Loan Agreement. Pursuant to the Second Mezzanine Loan Amendment, the Mezzanine Loan Lenders made an additional advance to the Mezzanine Loan Borrower in the aggregate amount of approximately $72.2 million, which amount was secured by the Mezzanine Loan Collateral. As of April 20, 2018, after giving effect to such borrowing, the aggregate principal amount of the Mezzanine Loans outstanding under the Mezzanine Loan Agreement was approximately $378.9 million.

On April 20, 2018, certain of the Reporting Persons delivered a letter (the “Proposal”) to the Board of Directors of Holdings (the “Board”) pursuant to which those Reporting Persons proposed that the Board consider a divesture by Holdings of all or a portion of (i) its rights to the Kenmore brand name and other related assets (“Kenmore”), (ii) the Home Improvement Business of the Sears Home Services Division (“SHIP”) and (iii) the Parts Direct business of the Sears Home Services division (“Parts Direct”). The Proposal also included a non-binding indication of interest of those Reporting Persons to acquire SHIP and Parts Direct for $500 million. The Proposal indicates that such transaction would be undertaken in connection with (a) an exchange offer with respect to 50% of approximately $600 million in outstanding 2nd lien indebtedness not secured by real estate for equity of Holdings of equal value and (b) a tender offer for 100% of Holdings’ approximately $900 million in outstanding unsecured indebtedness at a discount to par. The Proposal indicates that those Reporting Persons would consider participating in such exchange offer and tender offer, assuming the proceeds of the proposed divestures are sufficient to allow Holdings to substantially reduce its overall leverage. The Proposal also notes that, if Holdings believed it would be helpful, those Reporting Persons would be prepared to submit a proposal for the acquisition of all or a portion of Kenmore.

The Proposal may relate to, or could result in, some or all of the matters referred to in subparagraphs (a)-(j) of Item 4 of Schedule 13D.

The foregoing description of the Proposal does not purport to be complete and is qualified in its entirety by reference to the Proposal, attached hereto as Exhibit 99.66 and incorporated by reference herein.”

Item 5. Interest in Securities of the Issuer.

Item 5 is hereby amended and restated in its entirety as follows:

“(a)-(b) Each Reporting Person declares that neither the filing of this statement nor anything herein shall be construed as an admission that such person is, for the purposes of Section 13(d) or 13(g) of the Act or any other purpose, the beneficial owner of any securities covered by this statement.

Each Reporting Person may be deemed to be a member of a group with respect to Holdings or securities of Holdings for the purposes of Section 13(d) or 13(g) of the Act. Each Reporting Person declares that neither the filing of this statement nor anything herein shall be construed as an admission that such person is, for the purposes of Section 13(d) or 13(g) of the Act or any other purpose, (i) acting (or has agreed or is agreeing to act) with any other person as a partnership, limited partnership, syndicate, or other group for the purpose of acquiring, holding, or disposing of securities of Holdings or otherwise with respect to Holdings or any securities of Holdings or (ii) a member of any syndicate or group with respect to Holdings or any securities of Holdings.

As of the time of filing on April 23, 2018, the Reporting Persons may be deemed to beneficially own the shares of Holdings Common Stock set forth in the table below.


REPORTING PERSON	NUMBER OF SHARES BENEFICIALLY OWNED			PERCENTAGE OF OUTSTANDING SHARES			SOLE VOTING POWER			SHARED VOTING POWER		SOLE DISPOSITIVE POWER			SHARED DISPOSITIVE POWER
ESL Partners, L.P.		150,697,238	(1)(2)		73.2	% (3)		50,725,568	(2)		0		50,725,568	(2)		99,971,670	(1)
JPP II, LLC		60,000,000	(4)(5)		35.7	% (6)		18,813,200	(4)		0		18,813,200	(4)		41,186,800	(5)
SPE I Partners, LP		150,124			0.1	%		150,124			0		150,124			0
SPE Master I, LP		193,341			0.2	%		193,341			0		193,341			0
RBS Partners, L.P.		151,040,703	(1)(7)		73.4	% (3)		51,069,033	(7)		0		51,069,033	(7)		99,971,670	(1)
ESL Investments, Inc.		151,040,703	(1)(7)		73.4	% (3)		51,069,033	(7)		0		51,069,033	(7)		99,971,670	(1)
JPP, LLC		41,186,800	(5)		27.6	% (8)		41,186,800	(5)		0		0			41,186,800	(5)
Edward S. Lampert		151,040,703	(1)(7)		73.4	% (3)		151,040,703	(1)(7)		0		51,069,033	(7)		99,971,670	(1)

(1)

This number includes 32,717,912 shares of Holdings Common Stock held by Mr. Lampert, 6,328,688 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Warrants held by Mr. Lampert, 3,452,290 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Senior Secured Convertible PIK Toggle Notes held by Mr. Lampert, 16,285,980 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Senior Unsecured Convertible PIK Toggle Notes held by Mr. Lampert, and 41,186,800 shares of Holdings Common Stock that JPP has the right to acquire within 60 days pursuant to the Second Lien Term Loan. Mr. Lampert is the sole member of, and may be deemed to indirectly beneficially own securities owned by, JPP. Partners has entered into a Lock-Up Agreement with Mr. Lampert that restricts the purchase and sale of securities owned by Mr. Lampert. Pursuant to the Lock-Up Agreement, Partners may be deemed to have shared dispositive power over, and to indirectly beneficially own, securities owned by Mr. Lampert. RBS, ESL and Mr. Lampert may also be deemed to have shared dispositive power over, and to indirectly beneficially own, such securities.

(2)

(3)

This is based upon 107,957,410 shares of Holdings Common Stock outstanding as of March 16, 2018, as disclosed in Holdings’ Annual Report on Form 10-K for the fiscal year ended February 3, 2018, that was filed by Holdings with the SEC on March 23, 2018, the 4,808,465 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Warrants held by Partners, the 680,209 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Senior Secured Convertible PIK Toggle Notes held by Partners, the 6,231,180 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Senior Unsecured Convertible PIK Toggle Notes held by Partners, the 18,813,200 shares of Holdings Common Stock that JPP II has the right to acquire within 60 days pursuant to the Second Lien Term Loan, the 41,186,800 shares of Holdings Common Stock that JPP has the right to acquire within 60 days pursuant to the Second Lien Term Loan, the 6,328,688 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Warrants held by Mr. Lampert, the 3,452,290 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Senior Secured Convertible PIK Toggle Notes held by Mr. Lampert, and the 16,285,980 shares of Holdings Common Stock that Mr. Lampert has the right to acquire within 60 days pursuant to the Senior Unsecured Convertible PIK Toggle Notes held by Mr. Lampert. Partners is the sole member of, and may be deemed to indirectly beneficially own securities owned by, JPP II. RBS is the general partner of, and may be deemed to indirectly beneficially own securities owned by, Partners. ESL is the general partner of, and may be deemed to indirectly beneficially own securities owned by, RBS. Mr. Lampert is the sole member of, and may be deemed to indirectly beneficially own securities owned by, JPP and is also the Chairman, Chief Executive Officer and Director of, and may be deemed to indirectly beneficially own securities owned by, ESL.

(4)	This number includes 18,813,200 shares of Holdings Common Stock that JPP II has the right to acquire within 60 days pursuant to the Second Lien Term Loan.

(5)	This number includes 41,186,800 shares of Holdings Common Stock that JPP has the right to acquire within 60 days pursuant to the Second Lien Term Loan.

(6)

(7)

This number includes 20,192,514 shares of Holdings Common Stock held by Partners, 4,808,465 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Warrants held by Partners, 680,209 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Senior Secured Convertible PIK Toggle Notes held by Partners, 6,231,180 shares of Holdings Common Stock that Partners has the right to acquire within 60 days pursuant to the Senior Unsecured Convertible PIK Toggle Notes held by Partners, 18,813,200 shares of Holdings Common Stock that JPP II has the right to acquire within 60 days pursuant to the Second Lien Term Loan, 150,124 shares of Holdings Common Stock held by SPE I and 193,341 shares of Holdings Common Stock held by SPE Master I. Partners is the sole member of, and may be deemed to indirectly beneficially own securities owned by, JPP II. RBS is the general partner of, and may be deemed to indirectly beneficially own securities owned by, Partners, SPE I and SPE Master I. RBS is the general partner of, and may be deemed to indirectly beneficially own securities owned by, Partners. ESL is the general partner of, and may be deemed to indirectly beneficially own securities owned by, RBS. Mr. Lampert is the Chairman, Chief Executive Officer and Director of, and may be deemed to indirectly beneficially own securities owned by, ESL.

(8)

(c) Other than as set forth on Annex B hereto, there have been no transactions in the class of securities reported on that were effected by the Reporting Persons during the past sixty days or since the most recent filing of Schedule 13D, whichever is less.

(d) Not applicable.

(e) Not applicable.”

Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Item 6 is hereby amended and supplemented as follows:

“The information set forth in Item 4 of this Amendment is incorporated by reference into this Item 6.”

Item 7. Material to be Filed as Exhibits.

Item 7 is hereby amended and restated in its entirety as follows:

“The following exhibits are filed as exhibits hereto:


Exhibit		Description of Exhibit

99.1		Amendment, dated March 22, 2005, to the Agreement, dated January 31, 2005, among Kmart Holding Corporation, Sears Holdings Corporation, ESL Partners, L.P., ESL Investors, L.L.C., ESL Institutional Partners, L.P. and CRK Partners II, L.P. (incorporated herein by reference to Exhibit L to the Amendment to Schedule 13D filed on April 1, 2005).

99.2		Acknowledgement, dated March 24, 2005, by Sears Holdings Corporation (relating to the assumption of the Registration Rights Agreement) (incorporated herein by reference to Exhibit K to the Amendment to Schedule 13D filed on April 1, 2005).

99.3		Letter Agreement, dated June 2, 2010, between ESL Partners, L.P. and Edward S. Lampert (incorporated herein by reference to Exhibit 8 to the Amendment to Schedule 13D filed on June 2, 2010).

99.6		Form of Letter (incorporated herein by reference to Exhibit 10.30 to Holdings’ Annual Report on Form 10-K filed on March 20, 2013).

99.7		Loan Agreement, dated September 15, 2014, among Sears, Roebuck and Co., Sears Development Co. and Kmart Corporation, and JPP II, LLC and JPP, LLC (incorporated herein by reference to Exhibit 99.7 to the Amendment to Schedule 13D filed on September 16, 2014).

99.8		Participation Agreement, dated September 22, 2014, among PYOF 2014 Loans, LLC, and JPP II, LLC and JPP, LLC (incorporated herein by reference to Exhibit 99.8 to the Amendment to Schedule 13D filed on September 24, 2014).

99.9		Amended and Restated Participation Agreement, dated September 30, 2014, among PYOF 2014 Loans, LLC, The Fairholme Partnership, LP, and JPP II, LLC and JPP, LLC (incorporated herein by reference to Exhibit 99.9 to the Amendment to Schedule 13D filed on October 1, 2014).



99.10		Form of Subscription Rights Certificate (incorporated herein by reference to Exhibit 99.10 to the Amendment to Schedule 13D filed on October 17, 2014).

99.11		Rights Purchase Agreement, dated as of October 26, 2014, by and between SPE Master I, LP and ESL Partners, L.P. (incorporated herein by reference to Exhibit 99.11 to the Amendment to Schedule 13D filed on October 28, 2014).

99.12		Rights Purchase Agreement, dated as of October 26, 2014, by and between SPE Master I, LP and Mr. Edward S. Lampert (incorporated herein by reference to Exhibit 99.12 to the Amendment to Schedule 13D filed on October 28, 2014).

99.13		Rights Purchase Agreement, dated as of October 26, 2014, by and between SPE I Partners, LP and ESL Partners, L.P. (incorporated herein by reference to Exhibit 99.13 to the Amendment to Schedule 13D filed on October 28, 2014).

99.14		Rights Purchase Agreement, dated as of October 26, 2014, by and between SPE I Partners, LP and Mr. Edward S. Lampert (incorporated herein by reference to Exhibit 99.14 to the Amendment to Schedule 13D filed on October 28, 2014).

99.15		Form of Subscription Rights Certificate (incorporated herein by reference to Exhibit 99.15 to the Amendment to Schedule 13D filed on November 12, 2014).

99.16		Form of Note (incorporated herein by reference to Exhibit 4.3 to the Post-Effective Amendment No. 1 to Form S-3 Registration Statement, filed by Holdings with the Securities and Exchange Commission on October 30, 2014).

99.17		Form of Warrant Certificate (incorporated herein by reference to Exhibit 4.4 to the Post-Effective Amendment No. 1 to Form S-3 Registration Statement, filed by Holdings with the Securities and Exchange Commission on October 30, 2014).

99.18		Amendment to Loan Agreement, entered into on February 25, 2015 and effective as of February 28, 2015, by and between JPP II, LLC and JPP, LLC and Sears, Roebuck and Co., Sears Development Co. and Kmart Corporation (incorporated herein by reference to Exhibit 10.1 to the Form 8-K, filed by Holdings with the Securities and Exchange Commission on February 26, 2015).

99.19		Form of Subscription Rights Certificate (incorporated herein by reference to Exhibit 99.19 to the Amendment to Schedule 13D filed on June 16, 2015).

99.20		Exchange Agreement, dated as of June 26, 2015, by and among ESL Partners, L.P. and Edward S. Lampert and Seritage Growth Properties, L.P. and Seritage Growth Properties (incorporated herein by reference to Exhibit 99.20 to the Amendment to Schedule 13D filed on June 29, 2015).

99.21		Form of Purchase and Sale Agreement, dated as of July 2, 2015, by and among the Participating Limited Partner, RBS Partners, L.P. and RBS Partners, L.P., in its capacity as general partner of either SPE I Partners, LP or SPE Master I, LP (incorporated herein by reference to Exhibit 99.21 to the Amendment to Schedule 13D filed on July 6, 2015).

99.22		Rule 10b5-1(c) Plan, dated July 2, 2015, by SPE I Partners, LP and RBS Partners, L.P. (incorporated herein by reference to Exhibit 99.22 to the Amendment to Schedule 13D filed on July 6, 2015).

99.23		Rule 10b5-1(c) Plan, dated July 2, 2015, by SPE Master I, LP and RBS Partners, L.P. (incorporated herein by reference to Exhibit 99.23 to the Amendment to Schedule 13D filed on July 6, 2015).

99.24		Letter Agreement, dated January 28, 2016, by and between Holdings and Edward S. Lampert (incorporated herein by reference to Exhibit 10.1 to the Form 8-K, filed by Holdings with the Securities and Exchange Commission on February 3, 2016).

99.25		Joint Filing Agreement (incorporated herein by reference to Exhibit 99.25 to the Amendment to Schedule 13D filed on February 4, 2016).

99.26		Loan Agreement, dated as of April 8, 2016, between Sears, Roebuck and Co., Sears Development Co., Innovel Solutions, Inc., Big Beaver of Florida Development, LLC and Kmart Corporation, and JPP, LLC, JPP II, LLC and Cascade Investment, L.L.C. (incorporated herein by reference to Exhibit 99.26 to the Amendment to Schedule 13D filed on April 12, 2016).

99.27		Co-Lender Agreement, dated as of April 8, 2016, by and among JPP, LLC and JPP II, LLC, and Cascade Investment, L.L.C. and each transferee of a portion of any interest in the loan made in accordance with the Co-Lender Agreement (incorporated herein by reference to Exhibit 99.27 to the Amendment to Schedule 13D filed on April 12, 2016).

99.28		Assignment and Acceptance, dated as of April 8, 2016, by and between Bank of America, N.A., as assignor, and JPP II, LLC, as assignee (incorporated herein by reference to Exhibit 99.28 to the Amendment to Schedule 13D filed on August 26, 2016).



99.29		Assignment and Acceptance, dated as of April 8, 2016, by and between Bank of America, N.A., as assignor, and JPP, LLC, as assignee (incorporated herein by reference to Exhibit 99.29 to the Amendment to Schedule 13D filed on August 26, 2016).

99.30		Second Lien Credit Agreement, dated as of September 1, 2016, by and among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, and JPP, LLC and JPP II, LLC (incorporated herein by reference to Exhibit 10.1 to the Form 8-K, filed by Holdings with the Securities and Exchange Commission on September 2, 2016).

99.31		Pari Passu Joinder Agreement, dated as of September 1, 2016, by JPP, LLC, as agreed to and accepted by Wilmington Trust, National Association, as collateral agent (incorporated herein by reference to Exhibit 99.31 to the Amendment to Schedule 13D filed on September 2, 2016).

99.32		Letter of Credit and Reimbursement Agreement, dated as of December 28, 2016, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, Citibank, N.A., as administrative agent and issuing bank, and JPP, LLC and JPP II, LLC (incorporated herein by reference to Exhibit 10.1 to the Form 8-K, filed by Holdings with the Securities and Exchange Commission on December 30, 2016).

99.33		Loan Agreement, dated as of January 3, 2017, among Sears Roebuck and Co., Kmart Stores of Illinois LLC, Kmart of Washington LLC and Kmart Corporation, collectively as borrower, and JPP, LLC and JPP II, LLC, collectively as initial lender (incorporated herein by reference to Exhibit 10.1 to the Form 8-K, filed by Holdings with the Securities and Exchange Commission on January 4, 2017).

99.34		Omnibus Amendment to Loan Documents and Request for Advance to Loan Agreement, dated as of January 12, 2017 among Sears Roebuck and Co., Kmart Stores of Illinois LLC, Kmart of Washington LLC and Kmart Corporation, collectively as borrower, and JPP, LLC and JPP II, LLC, collectively as initial lender (incorporated herein by reference to Exhibit 10.59 to Holdings’ Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 21, 2017).

99.35		First Amendment dated March 2, 2017, to Letter of Credit and Reimbursement Agreement, dated as of December 28, 2016, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp., Kmart Corporation, the financial institutions party thereto from time to time as L/C Lenders, and Citibank, N.A., as Administrative Agent and Issuing Bank (incorporated herein by reference to Exhibit 10.60 to Holdings’ Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 21, 2017).

99.36		Amended and Restated Loan Facility, dated as of May 22, 2017, by and among Roebuck and Co., Sears Development Co., Innovel Solutions, Inc., Big Beaver of Florida Development, LLC and Kmart Corporation with JPP, LLC, JPP II, LLC, and Cascade Investment, L.L.C. (incorporated herein by reference to Exhibit 10.1 to the Form 8-K, filed by Holdings with the Securities and Exchange Commission on May 24, 2017).

99.37		Amended and Restated Co-Lender Agreement, dated as of May 22, 2017, by and among JPP, LLC and JPP II, LLC, Cascade Investment, L.L.C., Petrus Yield Opportunity Fund, LP, Rimrock High Income Plus (Master) Fund, Ltd., Rimrock Low Volatility (Master) Fund, Ltd, Paragon SHC LLC, Paragon SHC II LLC, and each transferee of a portion of any interest in the loan made in accordance with the Amended and Restated Co-Lender Agreement (incorporated herein by reference to Exhibit 99.37 to the Amendment to Schedule 13D filed on May 24, 2017).

99.38		Amendment to Amended and Restated Loan Agreement, dated as of July 3, 2017, by and among Roebuck and Co., Sears Development Co., Innovel Solutions, Inc., Big Beaver of Florida Development, LLC and Kmart Corporation with JPP, LLC, JPP II, LLC, and Cascade Investment, L.L.C. (incorporated herein by reference to Exhibit 99.38 to the Amendment to Schedule 13D filed on July 10, 2017).

99.39		First Amendment to Second Lien Credit Agreement (incorporated herein by reference to Exhibit 10.1 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on July 7, 2017).

99.40		Line of Credit Loan Proposal to JPP, LLC, dated as of July 13, 2017 (incorporated herein by reference to Exhibit 99.40 to the Amendment to Schedule 13D filed on July 17, 2017).



99.41		Line of Credit Loan Proposal to JPP II, LLC, dated as of July 13, 2017 (incorporated herein by reference to Exhibit 99.41 to the Amendment to Schedule 13D filed on July 17, 2017).

99.42		Line of Credit Lender Joinder Agreement, dated as of July 13, 2017, by and among JPP, LLC, and JPP II, LLC, Sears Holdings Corporation, Sears Roebuck Acceptance Corp., Kmart Corporation, and JPP, LLC, in its capacity as administrative agent and collateral administrator (incorporated herein by reference to Exhibit 99.42 to the Amendment to Schedule 13D filed on July 17, 2017).

99.43		Second Amendment to Letter of Credit and Reimbursement Agreement, dated as of August 1, 2017, by and among Sears Holdings Corporation, Sears Roebuck Acceptance Corp., Kmart Corporation, the financial institutions party thereto from time to time as LC Lenders, and Citibank, N.A., as Administrative Agent and Issuing Bank (incorporated herein by reference to Exhibit 10.1 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on August 3, 2017).

99.44		Form of Assignment and Acceptance Agreement (incorporated herein by reference to Exhibit 99.44 to the Amendment to Schedule 13D filed on August 3, 2017).

99.45		Third Amendment to Letter of Credit and Reimbursement Agreement, dated as of August 9, 2017, by and among Sears Holdings Corporation, Sears Roebuck Acceptance Corp., Kmart Corporation, the financial institutions party thereto from time to time as LC Lenders, and Citibank, N.A., as Administrative Agent and Issuing Bank (incorporated herein by reference to Exhibit 10.1 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on August 10, 2017).

99.46		Amended and Restated Loan Agreement, dated as of October 4, 2017, among Sears Roebuck and Co., Kmart Stores of Illinois LLC, Kmart of Washington LLC, Kmart Corporation, SHC Desert Springs, LLC, Innovel Solutions, Inc., Sears Holdings Management Corporation, Maxserv, Inc. and Troy Coolidge No. 13, LLC collectively as borrower, and JPP, LLC and JPP II, LLC, collectively as initial lender (incorporated herein by reference to Exhibit 10.1 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on October 4, 2017).

99.47		Second Amended and Restated Loan Agreement, dated as of October 18, 2017, among Sears Roebuck and Co., Kmart Stores of Illinois LLC, Kmart of Washington LLC, Kmart Corporation, SHC Desert Springs, LLC, Innovel Solutions, Inc., Sears Holdings Management Corporation, Maxserv, Inc., Troy Coolidge No. 13, LLC, Sears Development Co. and Big Beaver of Florida Development, LLC, collectively as borrower, and JPP, LLC and JPP II, LLC, collectively as initial lender (incorporated herein by reference to Exhibit 10.1 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on October 19, 2017).

99.48		Amendment to Second Amended and Restated Loan Agreement, dated as of October 25, 2017, among Sears Roebuck and Co., Kmart Stores of Illinois LLC, Kmart of Washington LLC, Kmart Corporation, SHC Desert Springs, LLC, Innovel Solutions, Inc., Sears Holdings Management Corporation, Maxserv, Inc., Troy Coolidge No. 13, LLC, Sears Development Co. and Big Beaver of Florida Development, LLC, collectively as borrower, and JPP, LLC and JPP II, LLC, collectively as initial lender (incorporated herein by reference to Exhibit 10.1 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on October 30, 2017).

99.49		Second Amendment to Amended and Restated Loan Agreement, dated as of October 25, 2017, among Sears Roebuck and Co., Sears Development Co., Innovel Solutions Inc., Big Beaver of Florida Development, LLC and Kmart Corporation, collectively as borrower, and JPP, LLC, JPP II, LLC and Cascade Investment, L.L.C. collectively as initial lenders (incorporated herein by reference to Exhibit 10.2 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on October 30, 2017).

99.50		Term Loan Credit Agreement, dated as of January 4, 2018, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, as borrowers, the subsidiaries of Sears Holdings Corporation party thereto, the lenders party thereto from time to time, and JPP, LLC, as administrative and collateral agent (incorporated herein by reference to Exhibit 10.1 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on January 10, 2018).



99.51		Second Amendment to Second Lien Credit Agreement, dated as of January 9, 2018, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, the guarantors party thereto, the lenders party thereto, and JPP, LLC, as administrative agent and collateral administrator (incorporated herein by reference to Exhibit 10.2 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on January 10, 2018).

99.52		Amendment to Term Loan Credit Agreement, dated as of January 29, 2018, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, as borrowers, the subsidiaries of Sears Holdings Corporation party thereto, the lenders and other entities party thereto, and JPP, LLC, as administrative and collateral agent (incorporated herein by reference to Exhibit 10.1 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on January 31, 2018).

99.53		Third Amendment to Second Lien Credit Agreement, dated as of February 7, 2018, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, as borrowers, the subsidiaries of Sears Holdings Corporation party thereto, the lenders party thereto, and JPP, LLC, as administrative and collateral administrator (incorporated herein by reference to Exhibit 10.2 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on February 13, 2018).

99.54		Third Amendment to Term Loan Credit Agreement, dated as of February 7, 2018, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, as borrowers, the subsidiaries of Sears Holdings Corporation party thereto, the lenders party thereto, and JPP, LLC, as administrative and collateral administrator (incorporated herein by reference to Exhibit 10.3 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on February 13, 2018).

99.55		Second Amendment to Second Amended and Restated Loan Agreement, dated as of March 8, 2018, among Sears Roebuck and Co., Kmart Stores of Illinois LLC, Kmart of Washington LLC, Kmart Corporation, SHC Desert Springs, LLC, Innovel Solutions, Inc., Sears Holdings Management Corporation, Maxserv, Inc. and Troy Coolidge No. 13, LLC collectively as borrower, and JPP, LLC and JPP II, LLC, collectively as initial lender (incorporated herein by reference to Exhibit 10.1 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on March 14, 2018).

99.56		Indenture, dated as of March 20, 2018, by and among Sears Holdings Corporation, the guarantors party thereto and Computershare Trust Company, N.A., as trustee (attaching form of 6 5/8% Senior Secured Convertible PIK Toggle Note due 2019) (incorporated herein by reference to Exhibits 4.2 and 4.3 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on March 23, 2018).

99.57		Second Supplemental Indenture, dated as of March 20, 2018, by and between Sears Holdings Corporation, as obligor, and Computershare Trust Company, N.A., as trustee (attaching form of 8% Senior Unsecured Convertible PIK Toggle Note due 2019) (incorporated herein by reference to Exhibits 4.4 and 4.5 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on March 23, 2018).

99.58		Fourth Amendment to the Second Lien Credit Agreement, dated as of March 20, 2018, by and among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, the lenders party thereto, and JPP, LLC, as administrative agent and collateral administrator (incorporated herein by reference to Exhibit 10.1 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on March 23, 2018).

99.59		Mezzanine Loan Agreement, dated as of March 14, 2018, among SRC Sparrow 2, LLC, as borrower, JPP, LLC and JPP II, LLC, as lenders, and JPP, LLC, as administrative agent (incorporated herein by reference to Exhibit 10.92 to Holdings’ Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 23, 2018).

99.60		Fifth Amendment to the Third Amended and Restated Credit Agreement, dated as of March 21, 2018, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp., Kmart Corp., the lenders party thereto, Bank of America, N.A., as administrative agent, and the other parties thereto (incorporated herein by reference to Exhibit 10.4 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on March 23, 2018).



99.61		Sixth Amendment to the Third Amended and Restated Credit Agreement, dated as of March 21, 2018, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp., Kmart Corp., the lenders party thereto, Bank of America, N.A., as administrative agent, and the other parties thereto (incorporated herein by reference to Exhibit 10.5 to Holdings’ Current Report on Form 8-K filed with the Securities and Exchange Commission on March 23, 2018).

99.62		Joint Filing Agreement (incorporated herein by reference to Exhibit 99.62 to the Amendment to Schedule 13D filed on March 23, 2018).

99.63		Fourth Amendment to Letter of Credit and Reimbursement Agreement, dated as of December 13, 2018, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, as borrowers, JPP, LLC, JPP II, LLC and the other lenders party thereto, as lenders, and Citibank, N.A., as administrative agent (incorporated herein by reference to Exhibit 10.79 to Holdings’ Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 23, 2018).

99.64		Fifth Amendment to Letter of Credit and Reimbursement Agreement, dated as of February 13, 2018, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, as borrowers, JPP, LLC, JPP II, LLC and the other lenders party thereto, as lenders, and Citibank, N.A., as administrative agent (filed herewith).

99.65		Sixth Amendment to Letter of Credit and Reimbursement Agreement, dated as of April 20, 2018, among Sears Holdings Corporation, Sears Roebuck Acceptance Corp. and Kmart Corporation, as borrowers, JPP, LLC, JPP II, LLC, Crescent 1, L.P., Canary SC Fund, L.P., CYR Fund, L.P. and CMH VI, L.P., as lenders, and Citibank, N.A., as administrative agent (filed herewith).

99.66		Letter from ESL Investments, Inc. to the Board of Directors of Sears Holdings Corporation, dated April 20, 2018 (filed herewith).”

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.


Date: April 23, 2018	ESL PARTNERS, L.P.

	By: RBS Partners, L.P., as its general partner

	By: ESL Investments, Inc., as its general partner

	By:	/s/ Edward S. Lampert
	Name:	Edward S. Lampert
	Title:	Chief Executive Officer

	JPP II, LLC

	By: ESL Partners, L.P., as its sole member

	By: RBS Partners, L.P., as its general partner

	By: ESL Investments, Inc., as its general partner

	By:	/s/ Edward S. Lampert
	Name:	Edward S. Lampert
	Title:	Chief Executive Officer

	SPE I PARTNERS, LP

	By: RBS Partners, L.P., as its general partner

	By: ESL Investments, Inc., as its general partner

	By:	/s/ Edward S. Lampert
	Name:	Edward S. Lampert
	Title:	Chief Executive Officer

	SPE MASTER I, LP

	By: RBS Partners, L.P., as its general partner

	By: ESL Investments, Inc., as its general partner

	By:	/s/ Edward S. Lampert
	Name:	Edward S. Lampert
	Title:	Chief Executive Officer

	RBS PARTNERS, L.P.

	By: ESL Investments, Inc., as its general partner

	By:	/s/ Edward S. Lampert
	Name:	Edward S. Lampert
	Title:	Chief Executive Officer


				ESL INVESTMENTS, INC.
				By:		/s/ Edward S. Lampert
				Name:		Edward S. Lampert
				Title:		Chief Executive Officer
				JPP, LLC
				By:		/s/ Edward S. Lampert
				Name:		Edward S. Lampert
				Title:		Sole Member
				EDWARD S. LAMPERT
				By:		/s/ Edward S. Lampert

ANNEX B

RECENT TRANSACTIONS BY THE REPORTING PERSONS IN THE SECURITIES OF

SEARS HOLDINGS CORPORATION


Entity	Date of Transaction		Description of Transaction	Shares Acquired			Price Per Share
Edward S. Lampert		03/30/2018	Grant of Shares Pursuant to a Letter between Edward S. Lampert and Holdings		159,575		$	0
Edward S. Lampert		04/15/2018	Acquisition from Holdings of 6 ⁵⁄₈% Senior Secured Convertible PIK Toggle Notes		110,690	(1)		(2	)
ESL Partners, L.P.		04/15/2018	Acquisition from Holdings of 6 ⁵⁄₈% Senior Secured Convertible PIK Toggle Notes		21,809	(1)		(2	)

(1)

Represents the number of shares of Holdings Common Stock that may be acquired within 60 days upon the conversion of 6 5/8% Senior Secured Convertible PIK Toggle Notes into shares of Holdings Common Stock. The 6 5/8% Senior Secured Convertible PIK Toggle Notes are convertible at the option of an eligible holder into shares of Holdings Common Stock at the conversion price of 200 shares of Holdings Common Stock per $1,000 in principal amount of such notes, or $5.00 per share of Holdings Common Stock.

(2)	Holdings elected to pay interest on the 6 ⁵⁄₈% Senior Secured Convertible PIK Toggle Notes in-kind by increasing the principal amount of the 6 ⁵⁄₈% Senior Secured Convertible PIK Toggle Notes held by such reporting person.

EX-99.64 2 d575962dex9964.htm EX-99.64 EX-99.64

Exhibit 99.64

EXECUTION VERSION

FIFTH AMENDMENT TO

LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT

FIFTH AMENDMENT TO LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT (this “Amendment”) dated as of February 13, 2018, among

SEARS HOLDINGS CORPORATION, a Delaware corporation (“Holdings”),

SEARS ROEBUCK ACCEPTANCE CORP., a Delaware corporation, and KMART CORPORATION, a Michigan corporation (the “Borrowers”), and

the L/C Lenders party hereto,

in consideration of the mutual covenants herein contained and benefits to be derived herefrom.

W I T N E S S E T H:

WHEREAS, Holdings, the Borrowers, and the L/C Lenders party thereto, and Citibank, N.A., as the Agent and the Issuing Bank, are party to that certain Letter of Credit and Reimbursement Agreement (as amended pursuant to that certain First Amendment to Letter of Credit and Reimbursement Agreement dated as of March 2, 2017, that certain Second Amendment to Letter of Credit and Reimbursement Agreement dated as of August 1, 2017, that certain Third Amendment to Letter of Credit and Reimbursement Agreement dated as of August 9, 2017, and that certain Fourth Amendment to Letter of Credit and Reimbursement Agreement, dated as of December 13, 2017, the “Existing LC Facility Agreement”; the Existing LC Facility Agreement as amended hereby, the “Amended LC Facility Agreement”); and

WHEREAS, Holdings, the Borrowers, and the Required L/C Lenders have agreed to amend the Existing LC Facility Agreement.

NOW THEREFORE, in consideration of the mutual promises and agreements herein contained, the parties hereto hereby agree as follows:

1.	Incorporation of Terms. All capitalized terms not otherwise defined herein shall have the same meaning as in the Existing LC Facility Agreement.

2.	Amendments to Existing LC Facility Agreement. Each of the parties hereto agrees that, effective as of the Amendment Effective Date (as defined below), Section 6.02(j) of the Existing LC Facility Agreement shall be amended by adding the following sentence at the end thereof:

“The consummation of a cashless offer to exchange outstanding Permitted Debt for new Permitted Debt shall not be prohibited by this Section 6.02(j) so long as the maturity date of such new Permitted Debt is no earlier than the earlier of (1) the maturity date of the Debt being exchanged and (2) the date that is one year after the L/C Termination Date.”

Conditions to Effectiveness. This Amendment shall become effective on the date (the “Amendment Effective Date”) that this Amendment shall have been duly executed and delivered by Holdings, the Borrowers, and the Required L/C Lenders, and the Borrowers shall have received counterparts hereof that, when taken together, bear the signatures of each of the parties hereto.

4.	Binding Effect. The terms and provisions hereof shall be binding upon and inure to the benefit of the parties hereto, the L/C Lenders and their respective successors and assigns.

Multiple Counterparts. This Amendment may be executed in multiple counterparts, each of which shall constitute an original and together which shall constitute but one and the same instrument. Delivery of an executed counterpart of a signature page of this Amendment by facsimile or in electronic (i.e. “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Amendment.

6.	Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

7.	Jurisdiction. Section 9.11 of the Existing LC Facility Agreement is hereby incorporated by reference, mutatis mutandis, as if it were fully set forth in this Amendment.

WAIVER OF JURY TRIAL. EACH OF HOLDINGS, THE BORROWERS AND THE L/C LENDERS HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AMENDMENT OR THE OTHER LOAN DOCUMENTS OR THE ACTIONS OF THE AGENT, THE ISSUING BANK OR ANY L/C LENDER IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF OR THEREOF.

[Remainder of page intentionally left blank; Signature pages follow.]

-2-

IN WITNESS WHEREOF, this Amendment has been duly executed and delivered by each of the parties hereto as of the date first above written.


HOLDINGS:

SEARS HOLDINGS CORPORATION

By:		/s/ Robert A. Riecker
Name:		Robert A. Riecker
Title:		Chief Financial Officer

BORROWERS:

SEARS ROEBUCK ACCEPTANCE CORP.

By:		/s/ Robert A. Riecker
Name:		Robert A. Riecker
Title:		Vice President, Finance

KMART CORPORATION

By:		/s/ Robert A. Riecker
Name:		Robert A. Riecker
Title:		Chief Financial Officer

[Signature page to LC and Reimbursement Agreement Amendment]


JPP, LLC, as an L/C Lender

By:		/s/ Edward S. Lampert
Name:		Edward S. Lampert
Title:		Member

JPP II, LLC, as an L/C Lender

By: RBS Partners, L.P., as Manager

By: ESL Investments, Inc., as General Partner

By:		/s/ Edward S. Lampert
Name:		Edward S. Lampert
Title:		Chairman and Chief Executive Officer

[Signature page to LC and Reimbursement Agreement Amendment]


CRESCENT 1, L.P.
CANARY SC FUND, L.P.
CYR FUND, L.P.
CMH VI, L.P.,
each as an L/C Lender

By:	Cyrus Capital Partners, L.P., as Investment Manager

	By:	/s/ Jennifer M. Pulick
	Name:	Jennifer M. Pulick
	Title:	Authorized Signatory

[Signature page to LC and Reimbursement Agreement Amendment]

EX-99.65 3 d575962dex9965.htm EX-99.65 EX-99.65

Exhibit 99.65

SIXTH AMENDMENT TO

LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT

SIXTH AMENDMENT TO LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT (this “Amendment”) dated as of April 20, 2018 among SEARS HOLDINGS CORPORATION, a Delaware corporation (“Holdings”), SEARS ROEBUCK ACCEPTANCE CORP., a Delaware corporation, and KMART CORPORATION, a Michigan corporation (the “Borrowers”), JPP, LLC, JPP II, LLC, CRESCENT 1, L.P., CANARY SC FUND, L.P., CYR FUND, L.P. and CMH VI, L.P., as L/C Lenders, and CITIBANK, N.A., as Administrative Agent (the “Agent”) and Issuing Bank (the “Issuing Bank”), in consideration of the mutual covenants herein contained and benefits to be derived herefrom.

W I T N E S S E T H:

WHEREAS, Holdings, the Borrowers, the L/C Lenders party thereto, the Agent and the Issuing Bank, are party to that certain Letter of Credit and Reimbursement Agreement (as amended pursuant to that certain First Amendment to Letter of Credit and Reimbursement Agreement dated as of March 2, 2017, that certain Second Amendment to Letter of Credit and Reimbursement Agreement dated as of August 1, 2017, that certain Third Amendment to Letter of Credit and Reimbursement Agreement dated as of August 9, 2017, that certain Fourth Amendment to Letter of Credit and Reimbursement Agreement dated as of December 13, 2017, and that certain Fifth Amendment to Letter of Credit and Reimbursement Agreement dated as of February 13, 2018, the “Existing LC Facility Agreement”; the Existing LC Facility Agreement as amended hereby, the “Amended LC Facility Agreement”); and

WHEREAS, Holdings, the Borrowers, the L/C Lenders party hereto, the Issuing Bank and the Agent have agreed to amend the Existing LC Facility Agreement pursuant to Section 9.01 of the Amended LC Facility Agreement.

NOW THEREFORE, in consideration of the mutual promises and agreements herein contained, the parties hereto hereby agree as follows:

1. Incorporation of Terms. All capitalized terms not otherwise defined herein shall have the same meaning as in the Existing LC Facility Agreement.

2. Representations and Warranties. Each Borrower hereby represents and warrants that (i) no Default or Event of Default exists under the Existing LC Facility Agreement or under any other Loan Document as of the date hereof, and (ii) all representations and warranties contained in the Amended LC Facility Agreement and the other Loan Documents are true and correct in all material respects as of the date hereof, except to the extent that (A) such representations or warranties are qualified by a materiality standard, in which case they are true and correct in all respects, and (B) such representations or warranties expressly relate to an earlier date (in which case such representations and warranties are true and correct in all material respects as of such earlier date).

3. Release by Borrowers. Each Borrower hereby acknowledges and agrees that it has no actual knowledge of any defenses or claims against any L/C Lender, the Agent, the Issuing Bank, any of their Affiliates, or any of their respective officers, directors, employees, attorneys, representatives, predecessors, successors, or assigns with respect to the Obligations, and that if such Borrower now has, or ever did have, any defenses or claims with respect to the Obligations against any L/C Lender, the Agent, the Issuing Bank or any of their respective officers, directors, employees, attorneys, representatives, predecessors, successors, or assigns, whether known or unknown, at law or in equity, from the beginning of the world through this date and through the time of effectiveness of this Amendment, all of them are hereby expressly WAIVED, and each Borrower hereby RELEASES each L/C Lender, the Agent, the Issuing Bank and their respective officers, directors, employees, attorneys, representatives, predecessors, successors, and assigns from any liability therefor.

4. Amendments to Existing LC Facility Agreement. Each of the parties hereto agrees that, effective as of the Amendment Effective Date (as defined below), the Existing LC Facility Agreement shall be amended as follows:

(a) The definition of “L/C Commitment” set forth in Section 1.01 of the Existing LC Facility Agreement is hereby amended by restating in full clause (iii) set forth therein to add the blue double-underlined text (indicated textually in the same manner as the following example: double-underlined):

“(iii) by an amount equal to the face amount of any Letter of Credit (A) that has been returned to the Agent for cancellation or (B) that has been reduced (other than any such reduction resulting from a drawing thereon) in accordance with a request by any of the Borrowers, in each case, prior to the L/C Termination Date unless a replacement therefor is issued within 30 days (or in the case of the Amendment No. 6 Replaced Letters of Credit, 60 days) (“Replacement Letter of Credit”) after the Reduction Election Date (but, in any event, prior to the L/C Termination Date) to the same or similar beneficiary (or, solely in the case of the Amendment No. 6 Replaced Letters of Credit, an additional beneficiary) and the Required L/C Lenders have provided their consent in writing to the issuance of such Replacement Letter of Credit (such consent not to be unreasonably conditioned, delayed or withheld); provided, that (x) the Agent shall promptly notify each L/C Lender that a Letter of Credit has either (A) been returned to it for cancellation or (B) been reduced as described in clause (B) above and any L/C Lender may, by written notice to the Agent no later than three (3) Business Days after the date of such notification from the Agent (the “Reduction Election Period”), elect to waive any reduction of its L/C Commitment pursuant to this clause (iii) so long as the aggregate amount in such L/C Lender’s Lender Cash Collateral Account would not be less than 102% of its L/C Commitment Percentage times the Issuer Exposure both immediately before and immediately after giving effect to such waiver and (y) no later than two (2) Business Days after the expiration of the Reduction Election Period, the Agent shall notify each L/C Lender of the election made by each other L/C Lender pursuant to the foregoing clause (x) and each L/C Lender may by written notice to

the Agent no later than one (1) Business Day after the date of such notification from the Agent update such election so long as the aggregate amount in such L/C Lender’s Lender Cash Collateral Account would not be less than 102% of its L/C Commitment Percentage times the Issuer Exposure both immediately before and immediately after giving effect to such election (the Business Day after the date of such notification, the “Reduction Election Date”); provided further that, excluding the Amendment No. 6 Replaced Letters of Credit, not more than three Replacement Letters of Credit may be issued by the Issuing Bank in the aggregate.

(a) The definition of “L/C Termination Date” set forth in Section 1.01 of the Existing LC Facility Agreement is hereby amended and restated as follows: “‘L/C Termination Date’” means December 28, 2019”.

(b) Section 1.01 of the Existing LC Facility Agreement is hereby amended by adding the following definitions in alphabetical order:

“Amendment No. 6 Effective Date” means April [ ], 2018.

“Amendment No. 6 Replaced Letters of Credit” means the Letters of Credit which are intended to replace the reduced amount of Letter of Credit #69608878 in the amount of $107,765,148.00 in accordance with the request by the Borrowers to Agent, dated as of April 18, 2018.

“Extension Fee. The Borrowers jointly and severally agree to pay to the Agent for the account of each L/C Lender an upfront fee equal to 1.0% of the aggregate amount of funds on deposit from such L/C Lender in the Lender Cash Collateral Account of such L/C Lender as of the Amendment No. 6 Effective Date, which amount shall be earned in full as of the Amendment No. 6 Effective Date and payable (i) 50% of such amount on the Amendment No. 6 Effective Date and (ii) the remaining 50% of such amount payable, as to any portion of the L/C Commitments, upon reduction or termination of such portion of the L/C Commitments of the L/C Lenders after the Amendment No. 6 Effective Date (whether as a result of the occurrence of the L/C Termination Date, the exercise of remedies due to an Event of Default including pursuant to Section 7.01(e), or otherwise, but excluding any reduction pursuant to clauses (iii) or (iv) of the definition of “L/C Commitment” due to the failure of the Required L/C Lenders to provide their consent in writing as contemplated thereby).

(d) Section 9.16(b) of the Existing LC Facility Agreement is hereby amended and restated in full as follows:

(b) such L/C Lender shall have received payment of an amount equal to its ratable share of the outstanding Reimbursement Obligations actually funded by such L/C Lender, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents from the assignee (to the extent of such outstanding Reimbursement Obligations, interest and fees) or the Borrowers (in the case of all other amounts), including, for the avoidance of doubt, the unpaid portion of the Extension Fee payable pursuant to Section 2.05(b), as if the L/C Commitments of such L/C Lender were being terminated rather than assigned;

(e) Add a new Section 9.22 as follows:

“L/C Lenders. Each of the L/C Lenders, for the benefit of the Agent and Issuing Bank, is and expressly agrees to continue to be, at all times prior to the termination in full of this Agreement and final discharge of the Obligations, a “Lender” or an “Affiliate of a Lender” under the Amended Credit Agreement.”

5. Conditions to Effectiveness. This Amendment shall become effective on the date (the “Amendment Effective Date”) that each of the following conditions precedent has been fulfilled as determined by the Agent:

(a) This Amendment shall have been duly executed and delivered by Holdings, the Borrowers, the L/C Lenders parties hereto, the Agent and the Issuing Bank, and the Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto.

(b) The Agent’s receipt of the following, each of which shall be originals or pdf copies (followed promptly by originals) unless otherwise specified, each properly executed by an Authorized Officer of the signing Loan Party, each dated as of the Amendment Effective Date (or, in the case of certificates of governmental officials, a recent date before the Amendment Effective Date) and each in form and substance satisfactory to Agent:

i. a reaffirmation agreement (the “Amendment Reaffirmation Agreement”) reaffirming (i) the guaranty and the liens granted under the Guarantee and Collateral Agreement (as amended prior to the date hereof) duly executed and delivered by each Loan Party to the Guarantee and Collateral Agreement and (ii) the liens granted under the Collateral Agreement.

ii. such certificates of resolutions or other action, incumbency certificates and/or other certificates of Authorized Officers of each Loan Party as the Agent may reasonably require evidencing (A) the authority of each Loan Party to enter into this Amendment and the other documents or instruments executed or to be executed in connection with this Amendment to which such Loan Party is a party or is to be a party and (B) the identity, authority and capacity of each Authorized Officer thereof authorized to act as an Authorized Officer in connection with this Amendment and such other documents to which such Loan Party is a party or is to be a party;

iii. copies of each Loan Party’s organization or other governing documents and such other documents and certifications as the Agent may reasonably require to evidence that each Loan Party is duly organized or formed, and that each Loan Party is validly existing and in good standing in its jurisdiction of organization (or in the case of this clause (iii), a certification by an Authorized Officer of each Loan Party that the applicable organization or other governing documents delivered to the Agent in connection with Amendment No. 2 Effective Date remain in full force and effect and have not been amended, modified, revoked or rescinded since such date);

iv. (A) an opinion of (i) in house counsel to the Loan Parties, (ii) Wachtell, Lipton, Rosen & Katz , counsel to the Loan Parties and (iii) Dykema Gossett PLLC, local counsel to the Loan Parties organized in the states of Michigan, Texas and Illinois, in each case, addressed to the Agent and each Lender as to such matters as the Agent may reasonably request and (B) [reserved];

v. a certificate signed by an Authorized Officer of Holdings and the Borrowers certifying (A) the conditions specified in this Section 5 have been satisfied or will be substantially simultaneously with the Amendment Effective Date, (B) the representations and warranties and other conditions made by each Loan Party in or pursuant to this Amendment (including Sections 2, 5.c and 5.d hereof) and the other Loan Documents are true and correct on and as of the date hereof in all material respects, before and after giving effect to the Amendment, as though made on and as of such date, except to the extent that (a) such representations or warranties are qualified by a materiality standard, in which case they shall be true and correct in all respects, and (b) such representations or warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct in all material respects as of such earlier date), (C) both immediately before and immediately after giving effect to the Amendment, no event has occurred and is continuing that constitutes a Default or an Event of Default, (D) that no Collateral Coverage Event (as defined in the Indenture for the Existing Second Lien Notes) shall exist as of the date hereof, (E) to the Solvency of the Loan Parties, taken as a whole, as of the Amendment Effective Date after giving effect to the transactions contemplated hereby, and (F) that attached to such certificates are the true and correct executed copies of the Guarantee and Collateral Agreement (as amended) and the Existing Intercreditor Agreement (as amended or amended and restated);

vi. results of searches or other evidence reasonably satisfactory to the Agent (in each case dated as of a date reasonably satisfactory to the Agent) indicating the absence of Liens on the assets of the Loan Parties, except for Liens permitted by Section 6.02(a) of the Amended LC Facility Agreement;

vii. such other customary certificates, documents or consents as the Agent reasonably may require; and

viii. an Existing Agent Acknowledgement and Consent, duly executed by the Existing Agent and Holdings, and the Borrowers.

(c) Since February 3, 2018, there shall not have been any event, circumstance or effect that has had or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

(d) After giving effect to this Amendment and the transactions contemplated hereunder, Capped Excess Availability shall not be less than $150,000,000.

(e) The Borrowers shall have paid all fees, expenses and other amounts due and owing to the Agent, the Issuing Bank and the L/C Lenders that have executed this Amendment.

6. L/C Lender Consent. Notwithstanding any minimum amounts required for any Letters of Credit to be issued under the Existing LC Facility Agreement, the L/C Lenders hereby consent to the (i) Amendment No. 6 Replaced Letters of Credit (as defined in the Amendment) and (ii) the issuance by the Issuing Bank of such Amendment No. 6 Replaced Letters of Credit.

7. Binding Effect. The terms and provisions hereof shall be binding upon and inure to the benefit of the parties hereto, the L/C Lenders, the Issuing Bank and their respective successors and assigns.

8. Expenses. The Borrowers shall reimburse the Agent and the L/C Lenders for all reasonable and documented out-of-pocket expenses incurred in connection herewith, including, without limitation, reasonable attorneys’ fees.

9. Multiple Counterparts. This Amendment may be executed in multiple counterparts, each of which shall constitute an original and together which shall constitute but one and the same instrument. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or in electronic (i.e. “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Agreement.

10. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

11. Jurisdiction. Section 9.11 of the Existing LC Facility Agreement is hereby incorporated by reference, mutatis mutandis, as if it were fully set forth in this Amendment.

12. WAIVER OF JURY TRIAL. EACH OF HOLDINGS, THE BORROWERS, THE AGENT, THE ISSUING BANK AND THE L/C LENDERS HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AMENDMENT OR THE OTHER LOAN DOCUMENTS OR THE ACTIONS OF THE AGENT, THE ISSUING BANK OR ANY L/C LENDER IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF OR THEREOF.

13. L/C Lender Reaffirmation. Each L/C Lender hereby confirms its assignments, pledges and grants of security interests, as applicable, under the Cash Collateral Agreement, and agrees that such assignments, pledges and grants of security interests shall continue to be in full force and effect, shall continue to secure full payment and performance of the “Obligations” (as defined in the Cash Collateral Agreement) of such L/C Lender, and shall accrue to the benefit of the Secured Party for its benefit and the benefit of the Agent and the Issuing Bank.

14. No Novation. Neither this Amendment nor the Amended LC Facility Agreement shall extinguish the Obligations under and as defined in the Cash Collateral Agreement or discharge or release the priority of the Cash Collateral Agreement or any other security therefor. Nothing contained herein or in the Amended LC Facility Agreement shall be construed as a substitution or novation of the Obligations under and as defined in the Cash Collateral Agreement or instruments securing the same, which shall remain in full force and effect. Nothing implied in this Amendment, the Amended LC Facility Agreement or in any other document contemplated hereby or thereby shall be construed as a release or other discharge of any L/C Lender from any of its Obligations under and as defined in the Cash Collateral Agreement.

[Remainder of page intentionally left blank; Signature pages follow.]

IN WITNESS WHEREOF, this Amendment has been duly executed and delivered by each of the parties hereto as of the date first above written.


HOLDINGS:

SEARS HOLDINGS CORPORATION



By:


Name:
Title:

BORROWERS:

SEARS ROEBUCK ACCEPTANCE CORP.



By:


Name:
Title:

KMART CORPORATION



By:


Name:
Title:

[Signature page to LC and Reimbursement Agreement Sixth Amendment]


Citibank, N.A., as Agent and Issuing Bank

By:
		Name:
		Title:

[Signature page to LC and Reimbursement Agreement Sixth Amendment]


JPP, LLC, as an L/C Lender

By:
		Name:
		Title:

JPP II, LLC, as an L/C Lender

By:		RBS Partners, L.P., as Manager

By:		ESL Investments, Inc., as General Partner

By:
		Name:
		Title:

[Signature page to LC and Reimbursement Agreement Sixth Amendment]


CRESCENT 1, L.P.
CANARY SC FUND, L.P.
CYR FUND, L.P.
CMH VI, L.P., as L/C Lenders

By: Cyrus Capital Partners, L.P., as Investment Manager

	By:
		Name:
		Title:

[Signature page to LC and Reimbursement Agreement Sixth Amendment]

EX-99.66 4 d575962dex9966.htm EX-99.66 EX-99.66

Exhibit 99.66

April 20, 2018

Board of Directors

Sears Holdings Corporation

3333 Beverly Road

Hoffman Estates, Illinois 60179

Ladies and Gentlemen,

Funds affiliated with ESL Investments are the largest stockholders of, and substantial lenders to, Sears Holding Corporation (“Sears”). We continue to see value in Sears and its underlying assets and believe strongly that with an appropriate runway Sears will be able to complete its transformation to respond to the challenging retail environment. We also are of the view that the portfolio of Sears’ assets has substantial value that is not being reflected in the capital markets or being maximized under the current organizational structure. These assets include the Kenmore brand and related assets (“Kenmore”), the Home Improvement business of the Sears Home Services division (“SHIP”), and the Parts Direct business of the Sears Home Services division (“Parts Direct”).

We understand that Sears has marketed certain of these assets for nearly two years but, with the exception of the Craftsman divestiture, has been unable to reach agreement with potential purchasers on acceptable terms. We are writing to confirm the view that we have recently expressed to you that Sears should aggressively pursue a divestiture of all or a portion of Kenmore, SHIP and Parts Direct and to express ESL’s interest in participating in such divestitures. In our view, pursuing these divestitures now will demonstrate the value of Sears’ portfolio of assets, will provide an important source of liquidity to Sears and could avoid any deterioration in the value of such assets. In particular:

•

ESL believes that Kenmore is an iconic brand with substantial value and Sears should aggressively pursue a divestiture of all, or a portion of, Kenmore in the near term. If Sears believes it would be helpful, ESL would be prepared to submit a proposal for such a transaction and believes it would be able to close such a transaction within 90 days.

•

ESL is pleased to submit a non-binding indication of interest to acquire SHIP and Parts Direct on the terms set forth below.

Additionally, if requested by the Sears Board of Directors, ESL also would be open to making an offer for Sears’ real estate (including the assumption of the $1.2 billion of debt obligations secured by such real estate), with the expectation of entering into an ongoing master lease for some or all of the stores to allow for their continued operation.

ESL would like to emphasize that its principal interest is seeing that the Kenmore, SHIP and Parts Direct businesses are divested in the near term at a full and fair value, regardless of whether ESL or a third party is the ultimate buyer, so that Sears is able to improve its debt profile and liquidity position. As a result, to ensure a fair process, ESL hereby confirms that:

•

Edward S. Lampert and Kunal S. Kamlani will not participate on behalf of Sears (as officer or director) in any discussions, deliberations, negotiations or decisions with respect to a potential transaction in which ESL participates as a buyer, except to the extent specifically requested by the committee referred to below.

•

ESL will not participate in any such transaction as a buyer unless such transaction is both (i) recommended by the related party transaction committee (or another committee of independent directors) of the Sears Board of Directors, which is fully empowered to consider such transaction, and (ii) approved by the holders of a majority of the shares of Sears held by disinterested stockholders.

•

ESL would accept that any transaction in which ESL participates as a buyer would be subject to a “go shop” process on reasonable terms.

We believe that adherence to the foregoing procedures will ensure that any transaction with ESL will be on fair and reasonable terms.

Key terms of our proposal to acquire SHIP and Parts Direct are set out below:

Valuation: We are interested in acquiring 100% of the equity of SHIP and Parts Direct based on an enterprise value of $500 million. The purchase price would be paid in cash and SHIP and Parts Direct would be acquired on a debt-free and cash-free basis with normalized levels of working capital.

Other Agreements: We would expect that Sears will enter into certain interim and long-term agreements with SHIP and Parts Direct to enable the continued operation of those businesses as they operate today. These agreements would include transition services agreements with Sears for a period of time, a brand licensing agreement for SHIP and Parts Direct and other customary ancillary documents for a transaction of this type. Our proposal is also subject to receiving the required consents to assign the supplier agreements to the buyer from the suppliers of each of SHIP and Parts Direct.

Financing: The cash consideration for the transaction would be financed with equity contributions from ESL and third party debt financing. At the appropriate time, we would also be open to discussing with you the possibility of partnering with third parties who might be interested in contributing equity financing. We do not anticipate any financing condition, since we plan to have our financing fully committed at the time we sign a definitive agreement.

Exchange and Tender Offers: The transaction would be undertaken in connection with (i) an exchange offer with respect to 50% of approximately $600 million in outstanding 2^nd lien indebtedness not secured by real estate for equity in Sears of equal value, and (ii) a tender offer for 100% of Sears’ approximately $900 million in outstanding unsecured indebtedness at a discount to par reflective of the current trading prices or, alternatively, for Sears equity. ESL believes that the exchange offer and the tender offer would be beneficial to the debt holders, by providing liquidity, to Sears, by reducing its debt obligations, and to equity holders, by reducing risk and giving Sears time to pursue value maximizing strategies. Assuming the proceeds from the contemplated divestitures is sufficient to allow Sears to substantially reduce its overall leverage, ESL would consider participating in such exchange offer and tender offer.

Timing and Advisors: We are prepared to move as quickly as possible to complete customary due diligence for a transaction of this nature and enter into definitive agreements. We believe that an expedited process is in the best interest of all parties involved. We have retained Moelis & Company as financial advisor and Cleary Gottlieb Steen & Hamilton LLP as legal counsel. Please feel free to reach out to any of the below regarding this Proposal.

Lawrence S. Chu

Moelis & Company

Managing Director

(212) 883-4588

LC@moelis.com

Christopher E. Austin

Benet O’Reilly

Cleary Gottlieb Steen & Hamilton LLP

Partner

(212) 225-2434

CAustin@cgsh.com
BOReilly@cgsh.com

This letter reflects ESL’s non-binding indication of interest. Nothing in this letter should be considered to constitute or create a binding obligation or commitment of ESL to proceed with, or consummate, any transaction. Any transaction among the parties will be subject to, and qualified in its entirety by, the execution and delivery of a mutually acceptable definitive agreement.

This proposal, including the exchange offer and tender offer and any alternative transactions with third parties, are part of a comprehensive solution to create a viable and healthy Sears, and will allow Sears to reduce its debt, extend its maturity profile and alleviate its liquidity challenges.

We are very enthusiastic about our ownership interest in Sears and its future, and will remain so whether or not a transaction is consummated. We are available to discuss the foregoing at your convenience.

Very truly yours,

ESL INVESTMENTS, INC.

Edward S. Lampert

Chairman and CEO