Spirit Airlines provided an update on its restructuring process regarding a new proposal (the "New Proposal") for an alternative restructuring plan submitted by Frontier Group Holdings, Inc., the parent company of Frontier Airlines, Inc.

On Feb. 4, 2025, Frontier submitted the New Proposal to Spirit. Under the terms of the New Proposal, which was subject to various conditions, Spirit's stakeholders would receive $400 million principal amount of second-lien debt issued by Frontier and 19.0% of Frontier's common equity following the proposed combination. The New Proposal would not require the Company to complete its previously announced $350 million equity rights offering, and required a waiver of the Bankruptcy Court-approved $35 million termination fee that would otherwise be owed under the Backstop Commitment Agreement, dated Nov. 18, 2024, by and among the Company and the other stakeholders party thereto (the "Backstop Commitment Agreement"). Notably, the New Proposal did not address certain material risks and issues previously identified by the Company, including that the New Proposal would deliver less in value to the Company's stakeholders than contemplated by the Company's existing plan of reorganization, is uncertain as to timing and completion, would result in extended and materially more costly and uncertain chapter 11 proceedings, and has uncertainties with regard to needed regulatory and court approvals. The Company's management and Board of Directors, consistent with their fiduciary duties, carefully reviewed the New Proposal in consultation with the Company's external legal and financial advisors.

On Feb. 4, 2025, as required by the Restructuring Support Agreement dated Nov. 18, 2024, by and among the Company, certain of its subsidiaries and the Consenting Stakeholders (as defined therein), the Company shared the New Proposal with the advisors for certain holders of the Company's (i) 8.00% Senior Secured Notes due 2025 (the holders, the "Senior Secured Noteholders") and (ii) 4.75% Convertible Senior Notes due 2025 (the holders, the "2025 Convertible Noteholders") and 1.00% Convertible Senior Notes due 2026 (the holders, together with the 2025 Convertible Noteholders, the "Convertible Noteholders").

On Feb. 6, 2025, the Company entered into confidentiality agreements (collectively, the "NDAs") with certain Senior Secured Noteholders and Convertible Noteholders (the "NDA Parties"). Pursuant to the NDAs, the Company shared Frontier's New Proposal with the NDA Parties.

On Feb. 7, 2025, Spirit submitted a counterproposal to Frontier (the "Spirit Counterproposal"). The aggregate value of the debt ($600 million) and equity ($1.185 billion) to be provided to Spirit stakeholders under the Spirit Counterproposal was equal to the amount of value that Frontier claimed it was providing to Spirit stakeholders under Frontier's New Proposal; the Spirit Counterproposal proposed market-based mechanisms to determine the amount of the equity in the combined company equity proposed for Spirit stakeholders. The Spirit Counterproposal would not require the Company to complete its previously announced equity rights offering but would require Frontier to pay the $35 million termination fee that would otherwise be owed under the Backstop Commitment Agreement.

On Feb. 10, 2025, Frontier rejected the Spirit Counterproposal in its entirety and reiterated the Feb. 4 New Proposal.

Spirit will continue swiftly to advance and conclude its restructuring process, which will significantly deleverage the Company and position it for long-term success. The hearing to consider confirmation of Spirit's plan of reorganization is currently scheduled for Feb. 13, 2025 at 10am EST. Approximately 99.99% of all voting creditors have voted to accept the plan, and all but two objections have already been resolved. The Company expects to complete the restructuring in the first quarter of 2025.

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.