We are advising Spirit Airlines in connection with entry into an RSA and negotiation of a prearranged chapter 11 plan

Davis Polk is advising Spirit Airlines, Inc. and its subsidiaries (collectively, “Spirit” or the “company”) in connection with a case commenced by the company under chapter 11 of the United States Bankruptcy Code. Spirit intends to use the restructuring process to implement a prearranged plan of reorganization that will 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, all without impacting its guests, vendors or other commercial counterparties.

On November 18, 2024, Spirit entered into a restructuring support agreement (the RSA) with a supermajority of Spirit’s loyalty and convertible bondholders.  In connection with the RSA, Spirit 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. Existing bondholders are also providing $300 million in debtor-in-possession financing.

To implement the RSA, the company commenced a prearranged chapter 11 process in the United States Bankruptcy Court for the Southern District of New York (the Bankruptcy Court). At a hearing on November 18, 2024, the Bankruptcy Court granted Spirit all of the relief requested in the company’s first-day motions, including the authority to pay all vendors and employees and to continue operating in the ordinary course. Spirit expects to emerge from its streamlined chapter 11 process in the first quarter of 2025.

Spirit is the seventh largest airline in the United States and a leading ultra low-cost carrier committed to delivering value to its guests by offering an enhanced travel experience with flexible, affordable options. Spirit employs over 21,000 direct employees and independent contractors, and serves destinations throughout the United States, Latin America and the Caribbean with one of the youngest and most fuel-efficient fleets in the United States.

The Davis Polk restructuring team includes partners Marshall S. Huebner and Darren S. Klein, counsel Christopher Robertson and associates Sophy Ma, Moshe Melcer, Destiny Iisha Reyes, Kayleigh Yerdon, Vincent Cahill, Audrey Youn, David J. Beer and Eva Wang. The capital markets team includes partner Yasin Keshvargar, counsel Chris Van Buren and associate Sean Kennelly. The finance team includes partner David Hahn, counsel Bernard Tsepelman and associate Zach Strother. Partners Louis Goldberg and Brian Wolfe and associates F. Adam Abulawi and Jeff Wu are providing corporate advice. The litigation team includes partner Benjamin S. Kaminetzky and associates Michael V Pucci, Kevin E. Sette and Rachael E. Jones. Partner Patrick E. Sigmon, counsel Leslie J. Altus and associates Dov Sussman and Caroline Peters are providing tax advice. Partner Travis Triano and associate Justin Alexander Kasprisin are providing executive compensation advice. Partner Frank Azzopardi and counsel Samantha Lefland are providing intellectual property advice. Members of the Davis Polk team are based in the New York and Washington DC offices.

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