The company is teetering on the brink, due to a lack of funds, and a lack of assets to sell to provide cash to fund continued operation. For the last few years, the company could go to Eddie for loans based on the securitization of assets, like stores, inventory, etc. Now that those are almost totally leveraged, the only real assets are the least desirable properties, Kenore, Home Improvement, and that's probably it.
Eddie is looking to take Kenmore and SHIP for a combined 480m, but he doesn't have the money for it himself. The company is losing 3 million per day, and the existing working capital does not support operations past mid September. The need the cash from those sales just to make it to Christmas. Eddie does not have the money on his own. That's the reason the stock price is tumbling.
It does not matter if Kmart has loyal customers who cream in their pants over the awesomeness of the low prices. It does not matter because when the company does not have the cash to fund operations, then the company will fold. No restructuring will allow a company with no assets and massive debt to survive.
As much as the cheerleader wants to state that Kmart is right sized, and Sears is being right sized, the fact is the infrastructure that supports those stores, and the cost structure associated with it was built for many thousands of stores, not a few hundred. There isn't enough sales from the remaining stores to support that cost structure, thus the continuing massive losses. Those losses directly affect cash flow.
In my estmation, these companies have months to survive. There will be no growth, and there is no future. Stockholders will be wiped out, employees will be terminated, inventory will be liquidated to partially pay down debts, and Eddie will walk away with bilions.