Case MFW Doc 2443 Filed 07/08/16 Page 1 of 6

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1 Case MFW Doc 2443 Filed 07/08/16 Page 1 of 6 IN THE UNITED BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re: SPORTS AUTHORITY HOLDINGS, INC., et al., 1 Debtors. Chapter 11 Case No (MFW) Jointly Administered Hearing Date: 7/15/2016 at 11:30 AM Objection Deadline: 7/8/2016 at 4:00 PM Related D.I. No.: 2286 JOINDER OF KMART CORPORATION TO CERTAIN LANDLORDS (A) AMENDED AND SUPPLEMENTED REQUEST FOR ADEQUATE PROTECTION AND MOTION OF CERTAIN LANDLORDS PURSUANT TO SECTIONS 361, 363(E), 503(B)(1) AND 105(A) OF THE BANKRUPTCY CODE FOR ENTRY OF AN ORDER REQUIRING THE DEBTORS TO IMMEDIATELY PAY MARCH 2016 STUB RENT FOR CLOSING STORES AS ADEQUATE PROTECTION FOR THE POSTPETITION USE OF THE LANDLORDS' PROPERTY, AND GRANTING SUCH OTHER AND FURTHER RELIEF AS IS JUST AND PROPER, AND (B) MOTION (I) TO COMPEL SURCHARGE OF COLLATERAL, (II) FOR PAYMENT OF MARCH 2016 STUB RENT, AND (III) FOR RELATED RELIEF FOR ORIGINAL "GO-FORWARD" STORES Kmart Corporation ( Kmart ), by and through its undersigned counsel, hereby files this joinder and motion (the Joinder ) with respect to Certain Landlords (A) Amended and Supplemented Request for Adequate Protection and Motion of Certain Landlords Pursuant to Sections 361, 363(e), 503(b)(1) and 105(a) of the Bankruptcy Code for Entry of an Order Requiring the Debtors to Immediately Pay March 2016 Stub Rent for Closing Stores as Adequate Protection for the Postpetition use of the Landlords' Property, and Granting Such Other and Further Relief as is Just and Proper, and (B) Motion (I) to Compel Surcharge of Collateral, (II) for Payment of March 2016 Stub Rent, and (III) for 1 The Debtors and the last four digits of their respective taxpayer identification numbers are as follows: Sports Authority Holdings, Inc. (9008); Slap Shot Holdings, Corp. (8209); The Sports Authority, Inc. (2802); TSA Stores, Inc. (1120); TSA Gift Card, Inc. (1918); TSA Ponce, Inc. (4817); and TSA Caribe, Inc. (5664). The headquarters for the above-captioned Debtors is located at 1050 West Hampden Avenue, Englewood, Colorado

2 Case MFW Doc 2443 Filed 07/08/16 Page 2 of 6 Related Relief for Original "Go-Forward" Stores (D.I. No. 2286) (the Landlords Supplemental Adequate Protection Motion ), and in support thereof Kmart respectfully states as follows: BACKGROUND 1. On March 2, 2016 ( Petition Date ), the above-captioned debtors and debtors-inpossession (collectively, the Debtors ) filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Code ( Bankruptcy Code ). 2. Kmart is the landlord of certain properties that are subject to subleases with debtor TSA Stores, Inc. ( TSA ) and debtor The Sports Authority, Inc. 3. More particularly, Kmart and TSA entered into a sublease (the Coral Springs Lease ) dated March 21, 2012, as may have thereafter been amended from time to time, for premises located in the Royal Eagle Plaza Shopping Center, Coral Springs, Florida (Store No ) (the Coral Springs Store ). 4. In addition, Kmart and The Sports Authority, Inc. entered into a Sublease Agreement dated September 18, 1992 in connection with property located in Suffolk County, New York (Store No ) (the Bohemia Store and, collectively with the Coral Springs Store, the Stores ), which Sublease Agreement was amended from time to time, including but not limited to that certain First Amendment to Sublease between Kmart and TSA as successor to The Sports Authority, Inc. (the Bohemia Lease and, collectively with the Coral Springs Lease, the Kmart Leases ). 5. On or about April 14, 2016, the Court entered the Order (A) Approving Bidding Procedures in Connection with (I) The Sale of Substantially All of the Debtors Assets and (II) the Transfer, Assumption and Assignment of Certain Unexpired Leases of Nonresidential Real 2

3 Case MFW Doc 2443 Filed 07/08/16 Page 3 of 6 Property; (B) Scheduling Separate Auctions For and Hearings to Approve the Sale of Assets and Unexpired Leases of Nonresidential Real Property Subject to the Debtors Store Closing Plan; (C) Approving Notice of Respective Date, Time and Place for Auctions and for Hearings on Approval of Respective Sales; (D) Approving Procedures for the Assumption and Assignment of Certain Executory Contracts and Unexpired Leases in Connection With the Sales; (E) Approving Form and Manner of Notice Thereof; and (F) Granting Related Relief, [D.I. No. 1186] in connection with certain of the Debtors leases that the Debtors are attempting to assume and assign. 6. On April 28, 2016, Kmart filed its objection to the Debtors proposed cure amounts [D.I. No. 1464] as same pertained to the Kmart Leases (the Cure Objection ). Upon information and belief, as of this date no order has been entered by the Court fixing the proposed cure amounts with respect to the Kmart Leases. 7. On May 6, 2016, the Debtors filed a Notice of Proposed Sale Orders and related documents in connection with an auction to be conducted on May 16, 2016 [D.I. No. 1752]. 8. On May 13, 2016, Kmart filed an objection to the entry of the Proposed Main Sale Order because, among other things, it did not require the payment of cure amounts upon any assumption and assignment of the Kmart Leases. [D.I. No. 1887]. 9. On May 17, 2016, the Debtors filed a Notice of Successful Bids and Next Highest Bids for Certain Main Auction Assets, Executed Agency Agreement, and Proposed Sale Guidelines [D.I. No. 1941]. 10. Also on May 17, 2016, the Debtors filed a Notice of Adjourned Main Auction, providing a new set of dates for the auction of remaining leases. As of this date no bidder has 3

4 Case MFW Doc 2443 Filed 07/08/16 Page 4 of 6 yet been identified as a potential assignee of the Kmart Leases, nor has any information yet been provided to Kmart concerning any potential assignee of the Kmart Leases. 11. The Debtors have continued to use and occupy the Stores at all times since the Petition Date, but have failed to make the payments due under the Kmart Leases from the Petition Date through March 31, 2016 (the Stub Rent Period ). The total amount due for the Stub Rent Period is not less than $117,933.80, plus any additional fees and costs due under the Kmart Leases which have not yet been reconciled, attorneys fees and costs (the Stub Rent ). 12. More particularly, that portion of the Stub Rent owed under the Coral Springs Lease is $39,204.16, and the Stub Rent owed under the Bohemia Lease is $78, Accordingly, on June 24, 2016, Kmart filed its Joinder Of Kmart Corporation To Various Landlords Motions And Request For Entry Of An Order Compelling Payment Of Stub Rent And Administrative Rent And For Adequate Protection Pursuant To Bankruptcy Code Sections 363(e), 365(d)(3), 503(b)(1) And 507(a) [D.I. No. 2298]. 14. To date, the Kmart Leases have not been assumed or rejected by the Debtors, but the Stores have remained open and going out of business sales have been conducted and, upon information and belief, are continuing at the Stores. RELIEF REQUESTED 15. The Landlords Supplemental Adequate Protection Motion seeks entry of an order requiring Debtors to immediately pay March 2016 stub rent, administrative expenses, and adequate protection pursuant to Bankruptcy Code Sections 363(e), 365(d)(3), 503(b)(1), and 507(a). It further outlines the ways in which the Debtors landlords are essentially being forced to pay for the liquidation of the Debtors secured creditors collateral without the ability to surcharge the secured creditors collateral pursuant to section 506(c) and 552(b) or compel their 4

5 Case MFW Doc 2443 Filed 07/08/16 Page 5 of 6 the payment of Stub Rent to landlords. Notably, this Court previously specifically declined to provide the Debtors lenders with a requested waiver of potential liability for such forms of relief consistent with the provisions of Bankruptcy Code section 506(c). 16. Consistent with the foregoing, Kmart hereby joins, adopts, and incorporates herein the points, authorities, and arguments set forth in the Landlords Supplemental Adequate Protection Motion, to the extent not inconsistent with this Joinder. Kmart further independently requests that the Court enter an order requiring Debtors to immediately pay to Kmart all post-petition rent and charges owing under the Kmart Leases, including but not limited to all rent and charges accrued and owing during the Stub Rent Period. 17. The Landlords Supplemental Adequate Protection Motion also pointedly notes that the Debtors lenders held liens on inventory that is being liquidated for their benefit through the going-out-of business/store closing sales. The lenders collateral should therefore be surcharged under 11 U.S.C. 506(c) to provide for payment of Stub Rent. 18. Based upon these circumstances, Kmart fully joins in the Landlords Supplemental Adequate Protection Motion for the reasons stated therein and hereby also requests that any relief granted on the Landlords Supplemental Adequate Protection Motion be extended to it, to the extent not inconsistent with this Joinder. [Balance of page intentionally left blank] 5

6 Case MFW Doc 2443 Filed 07/08/16 Page 6 of 6 CONCLUSION WHEREFORE, Kmart respectfully requests that the Court (i) enter an order granting the relief requested herein and in the Landlords Supplemental Adequate Protection Motion, and (ii) grant Kmart such other and further relief as may be just and proper. Dated: July 8, 2016 FOX ROTHSCHILD LLP By: /s/l. John Bird L. John Bird (DE No. 5310) Citizens Bank Center 919 North Market Street, Suite 300 Wilmington, DE Telephone: (302) Facsimile: (302) and- Richard M. Meth, Esq. FOX ROTHSCHILD LLP 75 Eisenhower Parkway, Suite 200 Roseland, New Jersey Telephone: Facsimile: rmeth@foxrothschild.com 6

7 Case MFW Doc Filed 07/08/16 Page 1 of 3 CERTIFICATE OF SERVICE I hereby certify that on the 28 th day of July, 2016, I caused copies of the foregoing Joinder Of Kmart Corporation To Certain Landlords (A) Amended And Supplemented Request For Adequate Protection And Motion Of Certain Landlords Pursuant To Sections 361, 363(E), 503(B)(1) And 105(A) Of The Bankruptcy Code For Entry Of An Order Requiring The Debtors To Immediately Pay March 2016 Stub Rent For Closing Stores As Adequate Protection For The Postpetition Use Of The Landlords' Property, And Granting Such Other And Further Relief As Is Just And Proper, And (B) Motion (I) To Compel Surcharge Of Collateral, (II) For Payment Of March 2016 Stub Rent, And (III) For Related Relief For Original "Go-Forward" Stores to be served upon the parties on the annexed service list as noted thereon. /s/ L. John Bird L. John Bird (DE No. 5310) ACTIVE v1 07/08/2016

8 Case MFW Doc Filed 07/08/16 Page 2 of 3 Via & First Class Mail: Michael R. Nestor Andrew J. Magaziner YOUNG CONAWAY STARGATT & TAYLOR, LLP Rodney Square 1000 North King Street Wilmington, DE mnestor@ycst.com; amagaziner@ycst.com Counsel to the Debtors Robert A. Klyman Matthew J. Williams GIBSON, DUNN & CRUTCHER LLP 333 South Grand Avenue Los Angeles, CA rklyman@gibsondunn.com; mjwilliams@gibsondunn.com Counsel to the Debtors SERVICE LIST Bradford J. Sandler, Esq. Robert J. Feinstein, Esq. & Jeffery N. Pomerantz, Esq. PACHULSKI STANG ZIEHL & JONES LLP 919 N. Market Street, 17th Floor Wilmington, DE bsandler@pszjlaw.com; rfeinstein@pszjlaw.com; jpomerantz@pszjlaw.com Proposed Counsel to the Committee Donald E. Rothman, Esq. RIEMER & BRAUNSTEIN LLP Three Center Plaza Boston, Massachusetts drothman@riemerlaw.com Counsel to Bank of America, N.A., in its capacity as (A) DIP Agent under the proposed Debtor-in-Possession Credit Agreement, and (B) Administrative Agent and Collateral Agent under the Second Amended and Restated Credit Agreement, dated as of May 17, 2012 Robert J. Stark, Esq. and Bennett S. Silverberg, Esq. BROWN RUDNICK LLP Seven Times Square New York, NY rstark@brownrudnick.com; bsilverberg@brownrudnick.com Counsel to (A) Wilmington Savings Fund Society, FSB as Administrative Agent and Collateral Agent under the May 3, 2006 Amended and Restated Credit Agreement and November 16, 2010 amended and restated and (B) certain Term Lenders under the May 3, 2006 Amended and Restated Credit Agreement and amended and restated November 16, 2010 ACTIVE v1 07/08/2016

9 Case MFW Doc Filed 07/08/16 Page 3 of 3 Kevin J. Simard, Esq. CHOATE, HALL & STEWART LLP Two International Place Boston, Massachusetts ksimard@choate.com Counsel to Wells Fargo Bank, National Association, in its capacity as FILO Agent under the Second Amendment to Second Amended and Restated Credit Agreement, dated as of November 3, 2015 John J. Rapisardi, Esq. O MELVENY & MEYERS LLP 7 Times Square Broadway, New York, NY jrapisardi@omm.com Counsel for certain holders of 11.5% Senior Subordinated Notes Due February 19, 2018 under the Securities Purchase Agreement, dated as of May 3, 2006 Via First Class Mail: Hannah J. McCollum, Esq. OFFICE OF THE UNITED STATES TRUSTEE for the District of Delaware 844 King Street, Suite 2207 Lockbox 35 Wilmington, DE U.S. Trustee ACTIVE v1 07/08/2016