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United States securities and exchange commission logo
February 22, 2021
Barry L. Biffle
President and Chief Executive Officer
Frontier Group Holdings, Inc.
4545 Airport Way
Denver, CO 80239
Re: Frontier Group
Holdings, Inc.
Draft Registration
Statement on Form S-1
Submitted January
25, 2021
CIK No. 0001670076
Dear Mr. Biffle:
We have reviewed your draft registration statement and have the
following comments. In
some of our comments, we may ask you to provide us with information so
we may better
understand your disclosure.
Please respond to this letter by providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. If you do not believe our comments apply to your facts and
circumstances or do not
believe an amendment is appropriate, please tell us why in your
response.
After reviewing the information you provide in response to these
comments and your
amended draft registration statement or filed registration statement, we
may have additional
comments.
Draft Registration Statement on Form S-1 Submitted January 25, 2021
Summary
Overview, page 1
1. We note your disclosure
on page 1 that the COVID-19 pandemic has presented significant
challenges to the
global airline industry since February 2020, and that you have worked
diligently to navigate
such challenges by implementing disciplined capacity deployment,
protecting liquidity
and cash flow, and further strengthening your health and safety
initiatives. Please
briefly discuss in this section the impact of the pandemic on your
business, operating
results, financial condition and liquidity.
Barry L. Biffle
FirstName LastNameBarry L. Biffle
Frontier Group Holdings, Inc.
Comapany22,
February NameFrontier
2021 Group Holdings, Inc.
February
Page 2 22, 2021 Page 2
FirstName LastName
2. We note your disclosure that in 2019, you had the most fuel efficient
fleet of all U.S.
carriers when measured by fuel gallons consumed per ASM, and your
disclosure that for
the year ended December 31, 2019, you were 43% more fuel efficient
than the weighted
average of other U.S. airlines. Please revise to clarify the source of
such information.
3. We note your disclosure on page 6 that a key feature of your network
includes the
removal of underperforming routes. If material, please revise to
describe the impact of
limitations imposed by the CARES Act or your agreements with Treasury
with respect to
continued service. In addition, please revise your disclosure on page
74 regarding the
primary conditions of the PSP funding to disclose the duration of the
requirement that you
maintain a certain level of scheduled air transportation as deemed
necessary by the
Department of Transportation to ensure that all routes you had
scheduled air travel to
before the downturn due to the COVID-19 pandemic are still served.
Our Competitive Strengths
Our Low-Cost Structure, page 4
4. We note certain of the metrics and related discussion presented under
this section are
presented for periods through December 31, 2019, while others are
presented for periods
through September 30, 2020. Revise this section to provide metrics and
related discussion
for consistent periods. Note that this comment also applies to similar
presentation
appearing on page 101.
Operating Statistics, page 17
5. You define Total Adjusted CASM as the sum of Adjusted CASM and
Adjusted Non-
operating Expenses per ASM. Please address the following:
Disclose the reasons why you believe the presentation of Total
Adjusted CASM
provides useful information to investors, any additional purposes
for which you use
Total Adjusted CASM, and any limitations associated with its use;
Present a detailed reconciliation for Total Adjusted CASM that
quantifies each non-
operating expense excluded; and
Revise the title as it appears confusingly similar to Adjusted
CASM.
Dividend Policy, page 58
6. Please clarify your ability to pay a dividend immediately prior to the
consummation of
this offering as disclosed on page 59, and in other sections of your
prospectus, such as in
the supplemental proforma information in Note 20 on page F-50. In this
regard, for
example, you disclose that in connection with your receipt of
financial assistance under
the PSP and PSP2, and entering into the Treasury Loan Agreement, you
agreed not to
make dividend payments in respect of your common stock through October
1, 2022, and
are prohibited from paying dividends on your common stock through the
date that is one
year after the secured loan provided under the Treasury Loan Agreement
is fully repaid.
Barry L. Biffle
FirstName LastNameBarry L. Biffle
Frontier Group Holdings, Inc.
Comapany22,
February NameFrontier
2021 Group Holdings, Inc.
February
Page 3 22, 2021 Page 3
FirstName LastName
In addition, please clarify throughout your filing the duration of the
restriction on paying
dividends.
Management's Discussion and Analysis of Financial Condition and Results of
Operations, page
69
7. Please discuss and analyze your financial condition and changes in
your financial
condition. Refer to Item 303(a) of Regulation S-K.
Results of Operations, page 79
8. You present Adjusted CASM in various places in your filing. Your
reconciliations on
pages 82 and 85 reconcile CASM to Adjusted CASM (excluding fuel) but
do not address
Adjusted CASM. Please present a reconciliation of Adjusted CASM or
tell us why you
do not believe one is required. Separately, tell us supplementally how
Adjusted CASM of
$10.21 for the nine months ended September 30, 2020 was calculated.
Liquidity and Capital Resources
Commitments and Contractual Obligations, page 91
9. Tell us whether the amounts presented for your contractual purchase
commitments for
aircraft and engines are based on actual contractual prices, list
prices, or something else.
Business
Competition, page 108
10. You state on page 1 of your submission that you are an ultra low-cost
carrier. In view of
that, explain to us why you believe it is appropriate to include in
your presentation of
Adjusted CASM (Excluding Fuel) and Total Adjusted CASM amounts
attributable to
airlines that are not ultra low-cost carriers.
11. For amounts that were not formulated or provided by carriers in their
public reports,
disclose whether the methods used to calculate the reported amounts
were consistently
applied across all calculations and whether the methods used were
consistent with the
calculations for amounts that were formulated or provided by carriers
in their public
reports.
12. In view of your statement that measures being presented may not be
comparable across all
carriers, explain to us why you believe your tabular comparison
provides information that
is useful to investors.
Operational Performance, page 111
13. We note your disclosure of on-time performance and completion factors.
Explain to us
how you considered providing additional information or context
surrounding these
measures to help investors understand their significance. For example,
explain how you
considered providing similar information for competitors.
Barry L. Biffle
FirstName LastNameBarry L. Biffle
Frontier Group Holdings, Inc.
Comapany22,
February NameFrontier
2021 Group Holdings, Inc.
February
Page 4 22, 2021 Page 4
FirstName LastName
Executive Compensation
Compensation Discussion and Analysis
Components of Compensation for Fiscal Year 2020, page 133
14. You disclose that during the second calendar quarter of 2020, Mr.
Biffle voluntarily
waived his base salary in light of the challenges presented to your
business by COVID-19.
Please revise to clarify the duration of such waiver, and whether Mr.
Biffle has resumed
receiving his base salary in 2021. In addition, please revise to
clarify whether the
summary compensation table reflects such waiver.
Director Compensation Table, page 155
15. Please update this table for your most recently completed fiscal year
end. See Item 402(k)
of Regulation S-K.
Description of Capital Stock
Forum Selection, page 172
16. We note that your forum selection provision identifies the Court of
Chancery of the State
of Delaware (or, if such court does not have subject matter
jurisdiction thereof, the federal
district court of the State of Delaware) as the exclusive forum for
certain litigation,
including any derivative action. Please revise to clarify
whether this provision applies to
actions arising under the Exchange Act. In that regard, we note your
disclosure that
nothing in your current certificate of incorporation or bylaws or your
restated certificate of
incorporation or amended and restated bylaws precludes stockholders
that assert claims
under the Exchange Act from bringing such claims in federal court to
the extent that the
Exchange Act confers exclusive federal jurisdiction over such claims,
subject to
applicable law.
General
17. Please provide us with supplemental copies of all written
communications, as defined in
Rule 405 under the Securities Act, that you, or anyone authorized to
do so on your behalf,
have presented or expect to present to potential investors in reliance
on Rule 163B of the
Securities Act, whether or not you retained, or intend to retain,
copies of those
communications. Please contact Kevin Dougherty to discuss how to
submit the materials,
if any, for our review.
You may contact Yong Kim at (202) 551-3323 or Gus Rodriguez, Accounting
Branch
Chief, at (202) 551-3752 if you have questions regarding comments on the
financial statements
Barry L. Biffle
Frontier Group Holdings, Inc.
February 22, 2021
Page 5
and related matters. Please contact Kevin Dougherty at (202) 551-3271 or Laura
Nicholson,
Special Counsel, at (202) 551-3584 with any other questions.
Sincerely,
FirstName LastNameBarry L. Biffle
Division of
Corporation Finance
Comapany NameFrontier Group Holdings, Inc.
Office of Energy &
Transportation
February 22, 2021 Page 5
cc: Tony Richmond
FirstName LastName