Penney’s lawyer Josh Sussberg announced the tentative pact, which will save roughly 70,000 jobs, during a brief hearing in bankruptcy court Wednesday.
Sussberg noted that a letter of intent including details of the pact will be filed with the bankruptcy court in the next day.
The 118-year-old department store based in Plano, Texas, filed for Chapter 11 bankruptcy protection in mid-May, one of the biggest retailers to do so since the pandemic temporarily shut down non-essential stores around the country.
Sussberg said Penney will be left with $1 billion in cash after the deal is completed.
Neither Simon nor Brookfield responded to requests for comment.