SCHEDULE 13D/A: ModivCare Files Chapter 11, Coliseum Capital Joins RSA

ModivCare Inc. has initiated Chapter 11 bankruptcy proceedings with a prearranged plan, which Coliseum Capital Management and its affiliates have joined as consenting creditors.

Summary

• ModivCare Inc. and certain of its subsidiaries voluntarily initiated Chapter 11 bankruptcy proceedings on August 20, 2025, in the United States Bankruptcy Court for the Southern District of Texas.
• The Chapter 11 filing includes a prearranged plan, as contemplated by a Restructuring Support Agreement (RSA) dated August 20, 2025, among the Company and certain first lien lenders and second lien noteholders.
• The RSA outlines a comprehensive restructuring of ModivCare's debt obligations and capital structure, along with a recapitalization of the Company.
• On November 24, 2025, Coliseum Capital Management, LLC, Coliseum Capital, LLC, Coliseum Capital Partners, L.P., Coliseum Capital Partners II, L.P., Adam Gray, and Christopher Shackelton executed a joinder to the RSA, agreeing to be bound by its terms as Consenting Creditors.
• Coliseum Capital Management, LLC, Adam Gray, and Christopher Shackelton collectively beneficially own 4,485,175 shares of ModivCare's common stock, representing 31.2% of the class.
• Key milestones for the Chapter 11 cases include the Bankruptcy Court entering an order confirming the Plan on or prior to December 10, 2025, and the Plan Effective Date occurring on or prior to December 24, 2025.

Sentiment

Score: 3

Explanation: The company is undergoing Chapter 11 bankruptcy, which is a severe negative event. While a prearranged plan and significant creditor support offer a structured path, the underlying financial distress and likely equity impairment are significant concerns for investors.

Positives

• The Chapter 11 filing is accompanied by a prearranged plan and a Restructuring Support Agreement (RSA), indicating a structured approach to debt resolution rather than an unmanaged liquidation.
• Significant creditors, including Coliseum Capital and its affiliates (holding 31.2% of common stock), have joined the RSA, suggesting broad support for the proposed restructuring terms.

Negatives

• ModivCare Inc. has initiated voluntary Chapter 11 bankruptcy proceedings, indicating severe financial distress and an inability to meet its current debt obligations.
• The restructuring involves a comprehensive overhaul of the Company's debt obligations and capital structure, which typically implies significant dilution or impairment for existing equity holders.

Risks

• There is no assurance that the Company will be successful in completing the restructuring, whether on the same or different terms, or at all.
• Failure to meet the specified milestones, such as court confirmation of the Plan by December 10, 2025, or the Plan Effective Date by December 24, 2025, could lead to termination of the RSA.
• The RSA may be terminated upon the occurrence of certain breaches by any party.
• The Company's board of directors may terminate the RSA if it reasonably determines, based on advice of outside legal counsel, that performance under the RSA would be inconsistent with its applicable fiduciary duties.

Future Outlook

The Company intends to pursue the restructuring in accordance with the terms set forth in the RSA and its attached term sheet. The restructuring aims to be completed by the Plan Effective Date on or prior to December 24, 2025, following court confirmation of the Plan by December 10, 2025.

Industry Context

This filing details a company-specific financial restructuring through Chapter 11 bankruptcy. While specific to ModivCare, such events can reflect broader challenges within the healthcare services or non-emergency medical transportation sector, potentially stemming from reimbursement pressures, operational inefficiencies, or high debt loads, which may impact other industry players facing similar headwinds.

Legal Proceedings

• ModivCare Inc. and certain of its subsidiaries voluntarily initiated proceedings under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas.

Stakeholder Impact

• Shareholders: Existing common stock shareholders are highly likely to face significant dilution or impairment of their investment due to the comprehensive restructuring and recapitalization under the Chapter 11 plan.
• Creditors: First lien lenders and second lien noteholders are actively involved in the Restructuring Support Agreement, indicating their participation in shaping the new capital structure, likely involving some concessions but also a defined path to recovery.
• Employees, Customers, Suppliers: While not explicitly detailed, bankruptcy proceedings can introduce uncertainty regarding job security, service continuity, and payment terms, respectively, though a prearranged plan aims to minimize disruption.

Next Steps

• Obtain a Bankruptcy Court order confirming the Plan on or prior to December 10, 2025.
• Achieve the Plan Effective Date on or prior to December 24, 2025.
• Cooperate in good faith to finalize the documents and agreements necessary to consummate and complete the restructuring.

Key Dates

Recommendation

The company has filed for Chapter 11 bankruptcy, which typically results in significant, if not total, loss of value for existing common equity holders. While a prearranged plan is in place, the fundamental event of bankruptcy signals severe financial distress and a high probability of substantial impairment for current shareholders.

Keywords

ModivCare Inc., Chapter 11, Bankruptcy, Restructuring Support Agreement, RSA, Coliseum Capital, Debt Restructuring, Recapitalization, SEC Filing, Schedule 13D/A, Corporate Governance