GT Real Estate Holdings gets confirmation of Chapter 11 plan

By Sarah Lizee

Olympia, Wash., Dec. 16 – GT Real Estate Holdings, LLC’s Chapter 11 plan was confirmed on Friday by the U.S. Bankruptcy Court for the District of Delaware, according to an order.

The plan was confirmed after some changes were made to language around the plan’s releases.

As previously reported, the company recently reached settlements with its parent and plan sponsor, DT Sports Holding, LLC, the city of Rock Hill, S.C., and York County, S.C.

DT Sports is owned by Carolina Panthers owner David Tepper. GT Real Estate was developed to own and develop a mixed-use community, sports and entertainment venue in Rock Hill, S.C., that would also include a new headquarters and practice facility for the Panthers.

In 2020, GT acquired 234 acres located in York County, S.C. But in March 2022, following default notices and the running of a cure period under agreements with the city, GT suspended work on the project and decided an orderly wind-down was the best path forward.

Under the city settlement, the city will be granted an allowed class 5 claim in the amount of $20 million. Under the county settlement, DT Sports will pay $21.17 million to the county and its claims will be extinguished.

On the effective date of the plan, the reorganized debtor will transfer the project site and materials to the city, subject only to a $60.5 million 8% PIK first-lien note in favor of the plan sponsor and some obligations owed to the state of South Carolina. The city may purchase all of the plan sponsor’s rights under the first-lien note.

The right to receive distributions under the plan on account of certain class 5 claims held by Panthers Football, LLC, the plan sponsor, Tepper Sports Holding, Inc., and Appaloosa Management LP will be assigned or otherwise transferred to the city.

Under the modified plan, class 5 holders that exchange certain voluntary releases now may get proceeds from any sale of the project site once the plan sponsor recovers $10 million of its debtor-in-possession claims. Previously, class 5 claimholders would receive nothing until the DIP claims were paid in full from the sale proceeds.

The $60.5 million city settlement amount provided by the plan sponsor will be the only source of recovery for holders of secured contractor claims and administrative contractor claims. If any proceeds of the settlement amount remain after payment of those claims in full, those proceeds will be used to fund distributions to holders of priority contractor claims, if any, until paid in full. If any settlement amounts remain after that, the proceeds will be distributed to holders of general unsecured claims until paid in full.

A $500,000 general unsecured creditor allocation and the remaining proceeds of the settlement amount following full repayment of the above claims will be the only source of recovery for general unsecured creditors.

The debtor will use any additional cash in its possession and any remaining availability under the DIP credit agreement to fund other payments, including administrative claims.

Any remaining proceeds from the settlement and general unsecured creditor allocation will be returned to the plan sponsor.

Other priority claims and other secured claims will be left unimpaired.

Interests will be canceled.

The Charlotte, N.C.-based real estate company filed Chapter 11 bankruptcy on June 1 under case number 22-10505.

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