SEARS HOLDINGS CORPORATION (NASDAQ:SHLD) Files An 8-K Entry into a Material Definitive Agreement

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SEARS HOLDINGS CORPORATION (NASDAQ:SHLD) Files An 8-K Entry into a Material Definitive Agreement

Item1.01

Entry into a Material Definitive Agreement

On January5, 2017, Sears Holdings Corporation, a Delaware
corporation (Sears Holdings), entered into a purchase and sale
agreement (the Purchase Agreement) with Stanley Black Decker,
Inc., a Connecticut corporation (Stanley), to which, on the terms
and subject to the conditions set forth therein, Stanley will
purchase the Craftsman business, including the Craftsman brand
name and related intellectual property rights (the Business),
from Sears Holdings (the Transaction).

The aggregate consideration payable in the Transaction consists
of (i)a $525 million payment at the closing of the Transaction,
subject to certain adjustments set forth in the Purchase
Agreement, (ii)a $250 million payment on the third anniversary of
the closing of the Transaction and (iii)contingent payments
payable on a quarterly basis during the 15-year period following
the closing of the Transaction (with the first payment, covering
the initial 12 quarters, due on the third anniversary of the
closing of the Transaction) based on a specified percentage of
aggregate worldwide net sales (as defined in the Purchase
Agreement) of Stanley and its affiliates of Craftsman branded
products.

The Purchase Agreement contains certain customary
representations, warranties and covenants by each party,
including a covenant by Sears Holdings to operate the Business in
all material respects in the ordinary course of business
consistent with past practice from the signing of the Purchase
Agreement until the closing of the Transaction.

The Transaction is subject to customary closing conditions,
including the expiration or early termination of the applicable
waiting periods under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended. The Transaction is further
subject to the execution of an amendment or waiver of the Pension
Plan Protection and Forbearance Agreement, dated as of March18,
2016, by and between Sears Holdings, certain of its affiliates
and the Pension Benefit Guaranty Corporation. There is no
financing condition to the Transaction. The Transaction is
expected to close during 2017.

The Purchase Agreement provides that, following the closing of
the Transaction, each party will have certain indemnification
obligations, including with respect to breaches of
representations, warranties and covenants, subject to specified
limitations. The Purchase Agreement may be terminated under
certain circumstances, including by either party if the closing
of the Transaction has not occurred by September30, 2017.

The Purchase Agreement contemplates the entry by the parties into
a license agreement as of the closing of the Transaction, to
which Stanley will license to Sears Holdings certain intellectual
property rights related to the Business (the Licensed IP), and
Sears Holdings will have the right to use the Licensed IP and to
continue to sell Craftsman branded products in certain
distribution channels, including stores owned and operated by
Sears Holdings under the Sears and Kmart brands and related
ecommerce sites. The license will be royalty-free during the
15-year period following the closing of the Transaction, and will
have a royalty rate of 3% of net sales (as defined in the license
agreement) thereafter. The license agreement may be terminated by
Stanley if Sears Holdings materially breaches any of the material
terms of the license agreement, subject to a notice and cure
period, or if Sears Holdings ceases to sell or sublicense
products branded with the Licensed IP, such that no such products
are sold for any consecutive six-month period. The parties have
also agreed to enter into a transition services agreement as of
the closing of the Transaction, to which Sears Holdings will
provide certain services in support of the Business to Stanley
during a limited transition period.

The foregoing description of the Purchase Agreement and the
Transaction does not purport to be complete and is subject to,
and qualified in its entirety by, the full text of the Purchase
Agreement, which is attached as Exhibit 2.1 to this Current
Report on Form8-K and incorporated by reference herein.

The Purchase Agreement has been included to provide investors
with information regarding its terms and is not intended to
provide any other factual information about Sears Holdings or
Stanley. The representations, warranties and covenants contained
in the Purchase Agreement were made only for purposes of such
agreement as of the specific dates therein, were solely for the
benefit of the parties to the Purchase Agreement, may be subject
to limitations agreed upon by the contracting parties, including
being qualified by confidential disclosures made for the purposes
of allocating contractual risk between the parties to the
Purchase Agreement instead of establishing these matters as
facts, and may be subject to standards of materiality applicable
to the contracting parties that differ from those applicable to
investors. For the foregoing reasons, the representations,
warranties and covenants should not be relied upon as statements
of factual information.

Forward-Looking Statements

This Current Report on Form 8-K contains forward-looking
statements intended to qualify for the safe harbor from liability
established by the Private Securities Litigation Reform Act of
1995, including, but not limited to, statements about the
Transaction. Forward-looking statements are subject to risks and
uncertainties that may cause the Companys 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 the Companys
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 Form 8-K and
those discussed in the Companys most recent Annual Report on Form
10-K and other filings with the U.S. Securities and Exchange
Commission. The Company intends the forward-looking statements to
speak only as of the time made and does not undertake to update
or revise them as more information becomes available, except as
required by law.


Item8.01
Other Events

On January5, 2017, Sears Holdings and Stanley issued a joint
press release announcing the execution of the Purchase Agreement.
The press release is attached hereto as Exhibit 99.1 and is
incorporated by reference herein.


Item9.01
Financial Statements and Exhibits

(d) Exhibits

Exhibit2.1 Purchase and Sale Agreement, dated as of January 5, 2017, by
and between Sears Holdings Corporation and Stanley Black
Decker, Inc.*
Exhibit99.1 Press Release, dated January 5, 2017.

*Schedules and exhibits have been omitted to Item601(b)(2) of
Regulation S-K. Sears Holdings hereby undertakes to furnish
supplementally copies of any omitted schedule or exhibit to the
U.S. Securities and Exchange Commission upon request.

to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.


SEARSHOLDINGS CORPORATION

By: /s/ Robert A. Riecker
Robert A. Riecker
ControllerandHeadofCapitalMarketActivities

Dated: January10, 2017


EXHIBIT INDEX

Exhibit2.1 Purchase and Sale Agreement, dated as of January 5, 2017, by
and between Sears Holdings Corporation and Stanley Black
Decker, Inc.*
Exhibit99.1 Press Release, dated January 5, 2017.

*Schedules and exhibits have been omitted


About SEARS HOLDINGS CORPORATION (NASDAQ:SHLD)

Sears Holdings Corporation is an integrated retailer. The Company is the parent company of Kmart Holding Corporation (Kmart) and Sears, Roebuck and Co. (Sears). It operates through two segments: Kmart and Sears Domestic. It operates approximately 940 Kmart stores across over 50 states, Guam, Puerto Rico and the United States Virgin Islands. Kmart stores carry an array of products across various merchandise categories, including seasonal merchandise, toys, lawn and garden equipment, food and consumables and apparel, including products sold under labels, such as Jaclyn Smith, Joe Boxer and Alphaline and certain Sears brand products (such as Kenmore, Craftsman and DieHard) and services. Its Sears Domestic segment’s operations consist of full-line stores, specialty stores, commercial sales and home services. Full-line stores offer an array of products and service offerings across various merchandise categories, including appliances, consumer electronics/connected solutions and tools.

SEARS HOLDINGS CORPORATION (NASDAQ:SHLD) Recent Trading Information

SEARS HOLDINGS CORPORATION (NASDAQ:SHLD) closed its last trading session up +0.04 at 9.14 with 1,625,902 shares trading hands.