GNC reorganization plan accepted by majority of voting creditors

By Sarah Lizee

Olympia, Wash., Oct. 8 – GNC Holdings, Inc.’s amended joint Chapter 11 plan of reorganization was accepted by a majority of voting creditors, according to ballot report filed Oct. 8 with the U.S. Bankruptcy Court for the District of Delaware.

Specifically, all 25 holders of $94,884,118.02 of tranche B-2 term loan secured claims voted to accept the plan.

Meanwhile, 462 holders, or 87.83% in number, of $325,109,972.34, or 97.55% in amount, of general unsecured claims, tranche B-2 term loan deficiency claims and convertible unsecured notes claims voted to accept the plan, while 64 holders, or 12.17% in number, of $8,179,118.55, or 2.45% in amount, voted to reject the plan.

As previously reported, under the plan, the company said it will restructure its pre-bankruptcy funded debt obligations with the proceeds of $525 million in new debt as well as the exchange of a portion of its pre-bankruptcy obligations for new common equity.

GNC’s ABL first-in, last-out term loan claims will be entirely rolled up into a debtor-in-possession ABL FILO facility. The DIP claims will be converted into exit FILO loans on the plan effective date.

The company’s pre-bankruptcy ABL loans have been paid in full in cash in accordance with the interim DIP financing order.

DIP new-money term loans and the roll-up term loan will be converted into exit facilities.

Holders of tranche B-2 term loan secured claims will receive a share of 100% of the new common equity in the reorganized company and exit loans.

If specified class 4 conditions are met, holders of general unsecured claims, convertible unsecured notes claims and tranche B-2 term loan deficiency claims will receive a share of second-lien take-back notes if a sale is completed or, if a restructuring is completed, new warrants or cash. If the conditions are not met, these creditors will receive a share of proceeds remaining after payment of other claims if a sale is completed or no distribution if a restructuring is completed.

Holders of existing equity interests will receive no distribution.

The plan confirmation hearing is scheduled for Oct. 14.

GNC Holdings is a Pittsburgh-based health, wellness and performance retailer. The company filed bankruptcy on June 23 under Chapter 11 case number 20-11662.

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