We advised the ad hoc group that negotiated and backstopped the restructuring

Davis Polk advised an ad hoc group of lenders and noteholders in connection with the chapter 11 restructuring of Air Methods Corporation. The ad hoc group negotiated the terms of the restructuring, which reduced the company’s leverage by approximately $1.7 billion. Air Methods filed its prepackaged chapter 11 cases in the United States Bankruptcy Court for the Southern District of Texas on October 24, 2023.

In connection with the restructuring, certain members of the ad hoc group backstopped an $80 million new-money DIP financing facility. The DIP package included a roll-up of prepetition term loans of $65 million that converted into exit term loans upon emergence. New capital for the reorganized company included (i) a $185 million debt rights offering for exit term loans with a stapled equity feature and (ii) a private placement to finance a $27 million cash-out option for lenders and noteholders to receive cash in lieu of equity, all of which was backstopped (or, in the case of the private placement, fully committed) by certain members of the ad hoc lender group.

The restructuring and plan of reorganization received unanimous support and achieved a fully consensual confirmation within 43 days of filing. Of those who voted on the plan, 100% of Air Method’s prepetition lenders and unsecured noteholders voted in favor of the plan. Air Methods received confirmation of its plan following an uncontested hearing on December 6, 2023, and it emerged from chapter 11 on December 28, 2023.

Air Methods is the nation’s leading air medical service, delivering lifesaving care to more than 100,000 people every year. With more than 40 years of air medical experience, Air Methods is the preferred partner for hospitals and one of the nation’s largest community-based providers of air medical services.

The Davis Polk restructuring team included partners Damian S. Schaible and Adam L. Shpeen, counsel Stephen D. Piraino and Robert (Bodie) Stewart and associates David Kratzer and Hailey W. Klabo. The finance team included counsel Jon Finelli and associates Timothy H. Oyen and Carly (Yoona) Cha. Partner Michael Davis and counsel Jacob S. Kleinman provided mergers and acquisitions advice. Associates Moses Farzan Nekou and Kerim K. Aksoy provided capital markets advice. Partner Corey M. Goodman provided tax advice. Members of the Davis Polk team are based in the New York and Washington DC offices.

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