GC Services parent ORG GC’s pre-packaged Chapter 11 plan effective

By Sarah Lizee

Olympia, Wash., Nov. 30 – ORG GC Midco, LLC, the parent company of GC Services LP, had its pre-packaged Chapter 11 plan go into effect on Monday, according to a notice filed with the U.S. Bankruptcy Court for the Southern District of Texas.

The plan was confirmed on Nov. 22, as previously reported.

ORG GC Midco has entered into a restructuring support agreement with 100% of its secured term lenders. The plan of reorganization is intended to substantially de-lever the company by reducing its funded debt to about $130.5 million from $210.3 million.

GC Services and the secured term lenders agreed to pursue a consensual balance sheet restructuring through a prearranged plan of reorganization, under which the secured term lenders will become the new indirect owners of the company.

The company said that 100% of the secured term lenders have already voted to accept the plan, which also has the support of ORG GC Midco’s shareholders.

According to the disclosure statement, the restructuring provides that existing term loans of about $210.3 million will be canceled and discharged in exchange for about $71 million of takeback first-lien term loans, about $29 million of takeback second-lien term loans, and preferred and common equity of the reorganized company.

BSP Agency, LLC is the administrative and collateral agent for the loans.

Interest on the first-lien loans is Libor plus 650 basis points. Interest on the second-lien loans is 18% PIK.

Each holder of an allowed existing term loan claim affiliated with Benefit Street Partners LLC will receive its pro rata share of initial new first-lien loans, second-lien loans, new junior holdco preferred equity and 100% of the new holdco common equity.

Each holder of an allowed existing term loan claim affiliated with Goldman Sachs Bank USA will receive its pro rata share of initial new first-lien loans, less the amount of term debtor-in-possession claims outstanding immediately prior to the effective date rolled into initial new first-lien loans, its pro rata share of new second-lien loans, and 100% of the new midco equity.

As a result of receiving 100% of the new midco equity, Goldman Sachs will acquire an indirect interest in 100% of the new holdco senior preferred equity and its pro rata share of new holdco junior preferred equity, both of which will be issued to the reorganized debtor; provided that prior to the effective date, Goldman Sachs may elect to have its pro rata share of the initial first-lien loans, less the amount of term DIP claims outstanding immediately prior to the effective date rolled into initial new first-lien loans, and/or its pro rata share of the new second-lien loans issued to the reorganized debtor.

Holders of existing asset-based lending facility claims are unimpaired and, on the effective date, will be either paid in full or converted on a dollar-for-dollar basis into an exit ABL facility.

Existing equity interests in the debtor will be canceled on the effective date.

The pre-packaged plan provides for the payment of all general unsecured claims in full in the ordinary course of business.

Houston-based GC Services is a provider of business process outsourcing and accounts receivable management solutions. Parent company ORG GC Midco filed bankruptcy on Nov. 8 under Chapter 11 case number 21-90015.

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