Flights, Ticket Sales, Reservations and All
Other Operations Continue as Normal
Restructuring Support Agreement Already Signed
by a Supermajority of Spirit's Bondholders
Voluntary Prearranged Chapter 11 Proceedings
Commenced to Implement the Agreed Deleveraging and Recapitalization
Transactions
Receives Backstopped Commitments for
$350 Million Equity Investment and
$300 Million in
Debtor-in-Possession Financing from Existing Bondholders;
Vendors, Aircraft Lessors and Holders of Secured
Aircraft Indebtedness to Be Paid in the Ordinary Course and
Will Not be Impaired
DANIA
BEACH, Fla., Nov. 18,
2024 /PRNewswire/ -- Spirit Airlines, Inc. ("Spirit"
or the "Company") (NYSE: SAVE) today announced that it has entered
into a restructuring support agreement (the "RSA") supported by a
supermajority of Spirit's loyalty and convertible bondholders on
the terms of a comprehensive balance sheet restructuring. The
restructuring is expected to reduce Spirit's debt, provide
increased financial flexibility, position Spirit for long-term
success and accelerate investments providing Guests with enhanced
travel experiences and greater value.
In connection with the RSA, Spirit has received backstopped
commitments for a $350 million equity
investment from existing bondholders and will complete a
deleveraging transaction to equitize $795
million of funded debt. To implement the RSA, the Company
has commenced a prearranged chapter 11 process in the United States Bankruptcy Court for the
Southern District of New York (the
"Court"). Existing bondholders are also providing $300 million in debtor-in-possession ("DIP")
financing, which, together with Spirit's available cash reserves
and cash provided by operations, is expected to further support the
Company through the chapter 11 process.
Spirit expects to continue operating its business in the normal
course throughout this prearranged, streamlined chapter 11 process.
Guests can continue to book and fly without interruption and can
use all tickets, credits and loyalty points as normal. The chapter
11 process itself will not impact Team Member wages or benefits,
which are continuing to be paid and honored for those employed by
Spirit. Vendors, aircraft lessors and holders of secured aircraft
indebtedness will continue to be paid in the ordinary course and
will not be impaired.
"I am pleased we have reached an agreement with a supermajority
of both our loyalty and convertible bondholders on a comprehensive
recapitalization of the Company, which is a strong vote of
confidence in Spirit and our long-term plan," said Ted Christie, Spirit's President and Chief
Executive Officer. "This set of transactions will materially
strengthen our balance sheet and position Spirit for the future
while we continue executing on our strategic initiatives to
transform our Guest experience, providing new enhanced travel
options, greater value and increased flexibility. I'm extremely
proud of the Spirit team's hard work and dedication, which is key
to our sustained progress in advancing our business and delivering
for our Guests."
As part of the chapter 11 process, Spirit is filing a proposed
Plan of Reorganization (the "Plan") that incorporates the agreed
terms of the RSA and is subject to confirmation by the Court. The
Company has received support from a supermajority of its loyalty
and convertible bondholders and expects to emerge from a
streamlined chapter 11 process in the first quarter of
2025.
In conjunction with the petition, Spirit has filed a series of
first-day motions, which, once approved by the Court, will further
facilitate the Company operating its business in the ordinary
course during the streamlined chapter 11 process.
As a result of the chapter 11 filing, Spirit expects to be
delisted from the New York Stock Exchange in the near term. The
Company expects that its common stock will continue to trade in the
over-the-counter marketplace through the chapter 11 process. The
shares are expected to be cancelled and have no value as part of
Spirit's restructuring.
Additional Information
Additional information about the Company's chapter 11 case,
including access to Court filings and other documents related to
the restructuring process, is available at
https://dm.epiq11.com/SpiritGoForward or by calling Spirit's
restructuring information line at (888) 863-4889 (U.S. toll free)
or +1 (971) 447-0326 (international). Additional information is
also available at www.SpiritGoForward.com.
Advisors
Davis Polk & Wardwell LLP is
serving as the Company's restructuring counsel, Alvarez &
Marsal is serving as restructuring advisor, and Perella Weinberg
Partners LP is acting as investment banker.
Akin Gump Strauss Hauer & Feld LLP is acting as legal
counsel and Evercore is acting as financial advisor to the ad hoc
group of loyalty noteholders.
Paul Hastings LLP is acting as legal counsel and Ducera Partners
LLC is acting as financial advisor to the convertible
bondholders.
About Spirit Airlines
Spirit Airlines (NYSE: SAVE) is a leading low-fare carrier
committed to delivering the best value in the sky by offering an
enhanced travel experience with flexible, affordable options.
Spirit serves destinations throughout the
United States, Latin
America and the Caribbean
with its Fit Fleet®, one of the youngest and most fuel-efficient
fleets in the U.S. Spirit is committed to inspiring positive change
in the communities it serves through the Spirit Charitable
Foundation. Discover elevated travel options with exceptional value
at spirit.com.
Investor Inquiries:
Spirit Investor Relations
investorrelations@spirit.com
Media Inquiries:
Spirit Media Relations
Media_Relations@spirit.com
FGS Global
Spirit@fgsglobal.com
Cautionary Statement Regarding Forward Looking
Statements
This press release contains various forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended (the "Securities Act"), and Section 21E of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") which are
subject to the "safe harbor" created by those sections.
Forward-looking statements are based on our management's beliefs
and assumptions and on information currently available to our
management. All statements other than statements of historical
facts are "forward-looking statements" for purposes of these
provisions. In some cases, you can identify forward-looking
statements by terms such as "may," "will," "should," "could,"
"would," "expect," "plan," "anticipate," "believe," "estimate,"
"project," "predict," "potential," and similar expressions intended
to identify forward-looking statements. Forward-looking statements
include, but are not limited to, statements regarding Spirit's
expectations with respect to operating in the normal course, the
Chapter 11 process, the DIP and potential delisting of Spirit's
common stock by the New York Stock Exchange. Forward-looking
statements are subject to risks, uncertainties and other important
factors that could cause actual results and the timing of certain
events to differ materially from future results expressed or
implied by such forward-looking statements. Factors include, among
others, risks attendant to the bankruptcy process, including the
Company's ability to obtain court approval from the Court with
respect to motions or other requests made to the Court throughout
the course of Chapter 11, including with respect the DIP; the
effects of Chapter 11, including increased legal and other
professional costs necessary to execute the Company's restructuring
process, on the Company's liquidity (including the availability of
operating capital during the pendency of Chapter 11); the effects
of Chapter 11 on the interests of various constituents and
financial stakeholders; the length of time that the Company will
operate under Chapter 11 protection and the continued availability
of operating capital during the pendency of Chapter 11; objections
to the Company's restructuring process, the DIP, or other pleadings
filed that could protract Chapter 11; risks associated with
third-party motions in Chapter 11; Court rulings in the Chapter 11
and the outcome of Chapter 11 in general; the Company's ability to
comply with the restrictions imposed by the terms and conditions of
the DIP and other financing arrangements; employee attrition and
the Company's ability to retain senior management and other key
personnel due to the distractions and uncertainties; risks
associated with the potential delisting or the suspension of
trading in its common stock by the New York Stock Exchange, the
impact of litigation and regulatory proceedings; and other factors
discussed in the Company's Annual Report on Form 10-K and
subsequent quarterly reports on Form 10-Q filed with the SEC and
other factors, as described in the Company's filings with the
Securities and Exchange Commission, including the detailed factors
discussed under the heading "Risk Factors" in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2023, as supplemented in the
Company's Quarterly Report on Form 10-Q for the fiscal quarters
ended March 31, 2024 and June 30, 2024. Furthermore, such forward-looking
statements speak only as of the date of this release. Except as
required by law, we undertake no obligation to update any
forward-looking statements to reflect events or circumstances after
the date of such statements. Risks or uncertainties (i) that are
not currently known to us, (ii) that we currently deem to be
immaterial, or (iii) that could apply to any company, could also
materially adversely affect our business, financial condition, or
future results. Additional information concerning certain factors
is contained in the Company's Securities and Exchange Commission
filings, including but not limited to the Company's Annual Report
on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports
on Form 8-K.
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SOURCE Spirit Airlines, Inc.