Penney will result in a deal, which would require a bankruptcy judge's approval, the sources said.

Penney is also in touch with some of its landlords, including Brookfield Asset Management Inc <BAMa.TO> and Simon Property Group <SPG.N>, about possible transactions, the sources said.

Wells Fargo & Co <WFC.N> is also involved in the discussions, one of the sources said.

Brookfield had no immediate comment while Simon and Wells Fargo did not immediately respond to requests for comment.

Penney is in discussions about handing over control to its lenders in exchange for reducing its nearly $5 billion of debt.

If the Plano, Texas-based company does not persuade enough lenders to approve its plan by the following day, July 15, the terms of its bankruptcy loan require J.C.

In July, the lenders will "decide whether the dream lives or the dream dies," said Cathy Hershcopf, a creditors' lawyer, during the hearing.

Penney, said during the hearing that "four major institutions" had signed confidentiality agreements to discuss working with the company and its lenders on the retailer's restructuring.

Sycamore, Brookfield, Simon and Wells Fargo are the four unnamed parties, one of the sources said.

Penney, said during Thursday's court hearing that the company needed to persuade lenders negotiating to take control of the restructured business to keep it alive and that he planned to hold them accountable for how the case ended.

Penney on Thursday said it plans to permanently close 154 stores, and may shut more.