UNDATED – Sears has a little more breathing room to turn its sinking ship around.

A bankruptcy judge on Thursday approved Sears’ plan to auction off about 500 stores. The auction is central to the company’s mission to remain in business. Sears intends to use funds from the sale for its operations, and it will pay rent to the stores’ buyers so they can stay open.

The judge in the case said that another hearing will be held a week before Christmas to consider whether to go ahead with Sears’ effort to stay in business or start the process to close all its remaining stores.

Sears also disclosed in a filing late Wednesday that it has arranged for an additional $350 million loan to fund operations during the bankruptcy process.

Sears’ attorneys conceded was a chance the company might not be able to survive.

Sears is hoping to at least breakeven during the 4h quarter holiday sales.