General Growth Properties files third amended reorganization plan

By Caroline Salls

Pittsburgh, Aug. 30 - General Growth Properties, Inc. filed a third amended plan of reorganization and related disclosure statement Friday with the U.S. Bankruptcy Court for the Southern District of New York, according to an 8-K filed Monday with the Securities and Exchange Commission.

Under the amended plan, General Growth will satisfy its debt and other claims in full, provide a substantial recovery for equity holders and implement a recapitalization with $7 to $8.5 billion of new capital.

As previously reported, General Growth will split itself into two separate publicly traded companies at emergence, and current shareholders will receive common stock in both companies.

The investment agreements with affiliates of Brookfield Asset Management, Fairholme Capital Management and Pershing Square Capital Management will provide $8.55 billion of capital commitments to General Growth in connection with its plan for emergence from Chapter 11.

In addition, the company said the Teacher Retirement System of Texas has agreed to invest $500 million in shares of New General Growth Properties common stock at $10.25 per share. This will replace the plan sponsors' $500 million equity backstop.

Creditor treatment

Treatment of creditors under the amended plan will include:

• Holders of administrative expense claims, priority tax claims, secured tax claims, priority non-tax claims, Rouse 8% note claims, Rouse 3 5/8% note claims and 2006 bank loan claims will be paid in full;

• General Growth Properties administrative expense claims will be reinstated and satisfied, settled or waived in the ordinary course of business;

• Holders of debtor-in-possession loan claims will be paid in full with accrued interest either in cash or shares of new common stock;

• Holders of mechanics' lien claims and general unsecured claims will be paid in full with post-bankruptcy interest;

• Holders of other secured claims will either be paid in full, have their claims reinstated or receive the collateral securing the claim;

• Holders of Rouse 5 3/8% note claims, Rouse 6¾% note claims and Rouse 7.2% note claims, will be paid cash for accrued interest and, at the election of the noteholders, have their claims reinstated or receive a new Rouse note, or, at the election of the company, these claims will be rendered unimpaired by means other than cure or reinstatement;

• Holders of TRUPS claims, GGP/Homart II, LLC Partner note claims and GGP/Ivanhoe Inc. affiliate partner note claims will, at the option of the company, be cured and reinstated with payment of accrued interest in cash or have the claims otherwise rendered unimpaired;

• Exchangeable note claims will either be cured and reinstated with payment of accrued interest in cash, be paid in cash for the principal amount plus interest or be otherwise rendered unimpaired;

• Holders of General Growth TRS retained debt claims will have their underlying agreement assumed and cure amounts paid or otherwise be left unimpaired;

• Holders of project level debt guaranty claims will receive a replacement guaranty;

• Holders of Hughes heirs obligation claims will have their share of the obligation value paid either through a Hughes heirs note, new General Growth and Spinco common stock or cash or otherwise have their claim left unimpaired;

• Holders of GGPLP LLC preferred equity units will receive cash for accrued dividends and reinstatement in reorganized GGPLP LLC;

• Holders of GGP LP preferred equity units will receive cash for accrued dividends and reinstatement in reorganized GGP LP, as well as a share of Spinco common stock as if their units had been converted immediately before the distribution record date;

• Holders of REIT preferred stock interests will receive cash and reinstatement;

• Holders of GGP LP common units will receive a cash distribution of $0.19 plus reinstatement plus a share of the Spinco share distribution; and

• Holders of General Growth common stock will receive new General Growth common stock and new Spinco common stock.

As previously reported, the plan confirmation hearing is scheduled for Oct. 21.

General Growth, a Chicago-based real estate investment trust that owns regional shopping malls, master planned community developments and commercial office buildings, filed for bankruptcy on April 16, 2009. Its Chapter 11 case number is 09-11977.

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