Avenger Flight Group - Case Summary

Business Description

Headquartered at 1450 Lee Wagener Blvd. in Fort Lauderdale, FL, Avenger Flight Group, LLC ("AFG LLC"), together with its Debtor and non-Debtor affiliates (collectively, "Avenger" or the "Company"), operates as a global leader in commercial aviation simulation and flight training.

• Avenger provides a full suite of advanced flight simulator training solutions to a customer base that includes blue-chip passenger airlines, low cost carriers ("LCCs"), regional airlines, charter operators, and training operators.
• In addition to providing access to state-of-the-art full-flight simulators ("FFS") and flight training devices ("FTD"), the Company offers related services, including cabin crew training.

As of the Petition Date, the Company operates across 11 training centers in four countries, comprising:

• 50 FFSes, of which 23 are owned by the Company, 12 are leased, 11 are housed and maintained, and four are subject to servicing agreements.
• 15 FTDs, of which six are owned and nine are serviced by the Company.

Avenger holds what it describes as a critical and strategic position in the "pilot pipeline." With more than 250,000 estimated new pilots needed worldwide by 2032 to account for pilot retirements and industry growth, the Company believes its experience and track record position it to serve an essential market need for years to come. Although the Company maintains an international footprint, together with opportunities for additional growth in emerging markets, it remains headquartered in Fort Lauderdale, where it was founded.

As of the Petition Date, AFG LLC employs approximately 97 employees (the "Employees") across the United States, allocated as follows:

• Dallas – Fort Worth: 49
• Fort Lauderdale: 26
• Las Vegas: 9
• Orlando: 7
• Minneapolis – St. Paul: 6

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Corporate History

Avenger was founded in 2012 with the aim of delivering cost-effective training solutions to rapidly expanding airlines like Spirit. From its formation, the Company sought to capitalize on an underserved opportunity in the aviation industry—providing outsourced aviation simulation to commercial airlines, in particular the growing low cost carrier market, and to flight training schools, becoming the sole provider for the largest flight training school in the United States.

• Avenger's rapid growth largely tracked the explosive growth of Spirit Airlines, while the Company simultaneously established strong relationships with other domestic LCCs including Allegiant, Avelo, and Sun Country.
• As Avenger grew, it also established relationships with international LCCs such as Viva Aerobus, Wizz Air, Iberia Express, and Condor, necessitating the establishment of foreign footprints.

Footprint Expansion and Rationalization

• Avenger began with a single location and two FFSes in Fort Lauderdale, expanding to a second location, and two additional FFSes, in Las Vegas by 2015.
• Over the next decade, the Company established additional domestic facilities—some within an airline customer's existing facilities—in Fort Worth, Irving, Orlando, and Minneapolis, along with overseas facilities in Monterrey, Madrid, Cancun (closed in 2024), Mexico City (at the AeroMexico Training Center), Medellin, Rome (closed in 2022), Warsaw (sold in 2025), Frankfurt, and Tel Aviv (sold in 2025).
  • Avenger's Colombian operations were conducted in partnership with Viva Air Colombia. Following Viva Air Colombia's commencement of bankruptcy proceedings in Colombia and cessation of operations in February 2023, Avenger has had no operations in Medellin for over two years, although two FFSes subject to the EDC Facilities remain in Colombia as of the Petition Date.
  • In 2019, Avenger entered into an agreement with Aviomar concerning Aviomar's use of a B737NG FFS to be housed at Aviomar's premises in Rome. Avenger terminated that agreement in 2022 and relocated the FFS.
  • In June 2025, Avenger's joint venture partner in Poland, Enter Air, purchased Avenger's interest in the joint venture, and in December 2025, Avenger sold its Israeli assets to El Al, its customer in Tel Aviv.

Governance and Management

As of the Petition Date, Hooman Yazhari serves as the sole Independent Manager of Avenger Flight Group Topco, LLC ("Topco") and AFG LLC. AFG LLC's senior management consists of:

• Chief Restructuring Officer: Lawrence Perkins
• Deputy Chief Restructuring Officer: Ben Smith
• Chief Executive Officer: Eduardo Carrasco
• Chief Financial Officer: Marc Sullivan
• Senior Vice President and General Counsel: Elsa Gagnon

• Mr. Perkins has served as CRO of the Debtors since January 20, 2026, and previously served as independent manager of Topco from November 12, 2025 to January 12, 2026 and as independent manager of AFG LLC from August 26, 2025 to January 12, 2026.
• Messrs. Perkins and Smith also serve as Chief Restructuring Officer and Deputy Chief Restructuring Officer, respectively, of each of the other Debtors, while Mr. Carrasco and Ms. Gagnon serve as director or manager, as applicable, of each of the Debtors other than Topco and AFG LLC.

Corporate Structure

Topco is the direct or indirect parent of each of the Debtors and the Foreign Non-Debtor Subsidiaries. AFG LLC is the Company's principal operating entity, although certain of the Company's domestic and foreign operations, assets, and liabilities lie with other Debtors and Foreign Non-Debtor Subsidiaries.

• United States: Certain Debtors (the "U.S. SPV Debtors") were created to hold the Company's interests in specific FFSes in accordance with the Company's lending or lease facilities, and none have any employees. The U.S. SPV Debtors are AFG Dallas, LLC; AFG Dallas III, LLC; AFG Dallas IV, LLC; AFG Orlando, LLC; AFG Sanford, LLC; and AFG FLL, LLC.
  • Debtor Avenger Flight Training, LLC ("AFT") holds the Debtors' FAA Part 142 certifications and qualifications and has four employees as of the Petition Date.
• EMEA: To facilitate operations in Europe and Asia, the Company formed subsidiaries in, among other countries, Germany, Spain, and Israel (the "EMEA Non-Debtor Subsidiaries"), each directly or indirectly wholly owned by Debtor Avenger Flight Group Europe Corp. ("AFG Europe"), which is in turn wholly owned by Debtor AFG SIM Holding Corp.
  • The EMEA Non-Debtor Subsidiaries are Avenger Spain, Avenger Germany, FTD Germany, FTD Spain, Avenger India, Avenger Italy, Avenger Israel, and Avenger Israel 737.
  • As of the Petition Date, Avenger India and Avenger Italy have no assets, liabilities, or operations. Avenger Israel 737 likewise has none, other than certain limited liabilities with respect to SIM International in connection with the purchase of an undelivered FFS that is no longer required for the Company's business.
  • Debtor AFG EU Operations Corp. was formerly used as part of the Company's European operations but, as of the Petition Date, has no assets, liabilities, or operations.
• Central and South America: Certain Debtors (the "SCA SPV Debtors") were created to hold the Company's interests in specific FFSes located in Mexico and Colombia in accordance with the Company's lending or lease facilities. The SCA SPV Debtors are AFG LATAM SIM Holdings, LLC; AFG LATAM SIM Holdings II, LLC; AFG LATAM SIM Holdings III, LLC; AFG LATAM SIM Holdings IV, LLC; AFG Mexico Corp.; and Avenger Flight Group México II, S. de R.L. de C.V., each incorporated in Florida other than AFG Mexico II.
  • Certain SCA SPV Debtors lease FFSes to Debtor AFG LATAM Holding Corp., which in turn subleases the FFSes to either non-Debtor Avenger Mexico or non-Debtor Avenger Colombia.
  • Non-Debtor Mexico Management, together with Avenger Mexico and Avenger Colombia the "SCA Non-Debtors," employs the Company's twelve employees located in Mexico. Each of the SCA Non-Debtors is wholly owned by Debtor AFG LATAM, LLC.

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Operations Overview

Regulatory Framework and Mandatory Flight Training

Regulators including the Federal Aviation Administration ("FAA") and the European Union Aviation Safety Agency ("EASA") mandate extensive flight training for all airline pilots ("Mandatory Flight Training"), which generally falls into three types:

• Initial training: A preliminary course designed for crewmembers operating a new type of aircraft for the first time, providing essential skills and knowledge covering areas such as aircraft systems and emergency procedures.
• Recurrent training: Ongoing mandatory training to maintain and update a pilot's skills and knowledge after initial certification, occurring at regular intervals—typically every six to twelve months for commercial pilots and every 24 months for general aviation pilots—and including both ground school and simulator sessions covering normal procedures, abnormal situations, and emergencies. The goal is to reinforce safety, correct deviations in routine, and ensure pilots are well-prepared for a wide range of scenarios.
• Upgrade training: Training required for a flight crew member who has served as second in command on a specific type of aircraft to become pilot in command of that same type, covering the knowledge and skills necessary to serve as pilot in command, including proper control of the aircraft and adherence to procedures.

• Many commercial airlines additionally require their flight crews to undergo airline-specific training focused on company-specific operating procedures, proprietary safety protocols, customer service expectations, and coordination within the airline's unique operational environment.
• Completion of Mandatory Flight Training is essential to the airline industry; a crew member who does not timely complete such training cannot fly. Specific requirements vary by aircraft make and model and by regulatory authority.

Market Dynamics

After pilots reach their required minimum flight hours to join an airline, nearly all subsequent training is conducted in advanced simulators. Because training in physical aircraft can cost as much as 25 times more, commercial airlines use regulatory-approved advanced simulators to deliver mandated initial, recurrent, and upgrade training.

• Airlines, particularly LCCs, have increasingly turned to third-party simulator providers such as Avenger to avoid the high initial capital outlay associated with purchasing from the limited supply of FTDs and FFSes necessary for Mandatory Flight Training, and to quickly add or reduce training capacity based on need.
• Third-party simulator providers are themselves highly regulated. Obtaining FAA certification in the United States under 14 CFR Part 142 involves a large capital outlay and rigorous evaluations and inspections, with Part 142 setting high standards for flight training curriculum, facilities, equipment, instructor qualifications, and safety protocols.
• The aviation industry faces many pilot retirements over the next decade, with approximately 4% of the pilot workforce retiring each year. At the same time, approximately 16,000 new business and commercial aircraft are expected to join the active civil aviation fleet by 2032, with five new crews (ten pilots) requiring training for each new commercial aircraft delivered. Industry experts accordingly project that over 250,000 new commercial airline pilots will be needed and will enter the "pilot pipeline" by 2032.

Contract Structures

Avenger offers customers several optimized contract structures intended to suit individual customer needs while maximizing the use of, and therefore the revenue generated from, the Company's simulators:

• Dedicated Provider: Contracts under which an airline customer commits to exclusivity with the Company for advanced flight simulator training. Customers with such contracts include Viva Aerobus, Aeromexico, and El Al.
• Take-or-Pay: Contracts under which customers, often legacy airlines or airlines with some in-house flight training, pay a fixed monthly rate for the ability to use the Company's advanced flight simulators. Customers with such contracts include Viva Aerobus.
• Minimum Guarantee: Contracts under which an airline partners with Avenger to utilize the Company's advanced flight simulators for a minimum number of hours per year. Customers with such contracts include Frontier Airlines.
• Power by the Hour: Contracts under which airlines and other training providers can utilize Avenger's excess hourly capacity. Customers with such contracts include Avelo, Iberia Express, Air Europa, and DHL Europe.

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Prepetition Obligations

The Debtors note that the description of their capital structure is for informational purposes only and is qualified in its entirety by reference to the documents setting forth the specific terms of such obligations and their related agreements.

Prepetition Term Loan Facility

• Pursuant to a Credit Agreement dated as of June 25, 2021 (the "Prepetition Credit Agreement"), the Prepetition Term Loan Lenders provided a secured term loan facility to certain of the Debtors. AFG LLC is the borrower, with Topco and other guarantors party thereto, and Wilmington Trust, National Association serves as administrative and collateral agent.
  • As of the Petition Date, the Credit Parties were indebted and jointly and severally liable to the Prepetition Term Loan Secured Parties in an aggregate principal amount outstanding of not less than $273,051,488.11, together with accrued and unpaid interest, fees, expenses, disbursements, indemnification obligations, and other charges.
  • The Credit Parties granted the Prepetition Term Loan Agent, for the benefit of the Prepetition Term Loan Secured Parties, a security interest in and continuing lien on all Collateral, including Cash Collateral, and all proceeds, products, accessions, rents, and profits thereof, whether then owned or existing or thereafter acquired or arising.
  • The Prepetition Term Loan Obligations include rescue financing advanced to the Debtors by the Prepetition Term Loan Secured Parties in September and December 2025 (the "Rescue Financing"), which provided critical liquidity to support operations, meet payroll and vendor obligations, and provide runway to negotiate with key stakeholders in the months leading up to the filing. According to the Debtors, the Rescue Financing afforded a more orderly transition into bankruptcy, including negotiated resolutions with key stakeholders, and reduced the need for a debtor-in-possession financing facility on a dollar-for-dollar basis.

SIM International Agreements

• Certain Debtors are party to agreements with SIM International B.V. and its affiliates ("SIM International") relating to the construction by SIM International and lease to the Debtors of FFSes. As of the Petition Date, the Debtors are party to SIM International Agreements related to eleven FFSes.
  • The Lessees under the SIM International Agreements are Avenger Spain, Avenger Germany, AFG Dallas IV, AFG Orlando, AFG Sanford, and AFG FLL.
  • The Debtors' obligations under each agreement are guaranteed by AFG LLC and secured by, among other things, each Lessee's rights in the applicable FFSes.
  • On February 12, 2026, the Company, SIM International, and the Prepetition Term Loan Lenders entered into a settlement agreement (the "SIM International Settlement") providing for a comprehensive settlement of the Company's obligations under the SIM International Agreements and a path forward for the ongoing relationship between SIM International and the Company, as well as the proposed Stalking Horse Bidder or other purchaser of its assets.

EDC Financing

Without acknowledging the validity, priority, enforceability, extent, or allowance of such claims and liens, the Debtors reference two loan agreements with Export Development Canada ("EDC"), as loan agent, lender, and security trustee:

• EDC LATAM Facility: A Loan Agreement dated as of November 1, 2018 with LATAM Sim Holdings, under which the EDC Secured Parties provided loans to certain Debtors for the purchase of one TRU Simulation + Training Canada Inc. A320 flight simulator unit bearing serial number SN-00002635 and certain related assets.
  • The facility is purportedly secured by such assets and certain other related assets, including the equity interests of LATAM SIM Holdings, substantially all of its assets, and the rights and interests of LATAM SIM Holdings and certain of its subsidiaries in certain related leases and subleases.
• EDC LATAM IV Facility: A Loan Agreement dated as of July 11, 2019 with LATAM Sim Holdings IV, under which the EDC Secured Parties provided loans for the purchase of one TRU Simulation + Training Canada Inc. A320 flight simulator unit bearing serial number SN-00002659 and certain related assets.
  • The facility is purportedly secured by such assets and certain other related assets, including the equity interests of LATAM SIM Holdings IV, substantially all of its assets, and the rights and interests of LATAM SIM Holdings IV and certain of its subsidiaries in certain related leases and subleases.

Revolving Facility

• In January 2025, AFG LLC obtained access to a revolving credit facility of up to $5 million in principal from Oxford Commercial Finance, secured by the Collateral as defined in the Revolving Loan Agreement.
  • On December 29, 2025, the Revolving Lender terminated the Revolving Loan Agreement pursuant to its terms, and as of the Petition Date the Debtors do not owe any amounts on the Revolving Facility.

Shareholder Notes

AFG LLC is the borrower under a series of interest-bearing unsecured promissory notes (the "Shareholder Notes") issued to certain parties (the "Unsecured Noteholders"), with principal and amounts outstanding as follows:

• Pedro Sors, 6/4/2020: $300,000 principal; $303,000 outstanding.
• Pedro Sors, 12/1/2020: $150,000 principal; $159,000 outstanding.
• Pedro Sors, 7/15/2024: $1,850,000 principal; $1,961,000 outstanding.
• John Pincavage, 5/31/2019: $200,000 principal; $212,000 outstanding.
• John Pincavage, 6/11/2019: $100,000 principal; $106,000 outstanding.
• John Pincavage, 7/15/2024: $500,000 principal; $530,000 outstanding.
• Elsa Gagnon, 5/31/2019: $150,000 principal; $159,000 outstanding.
• Angela Andrea Restrepo P.A., 12/29/2020: $200,000 principal; $212,000 outstanding.
• Alison Sors, 12/1/2020: $750,000 principal; $795,000 outstanding.
• Vida Mar Enterprises, LLC, 7/15/2024: $200,000 principal; $212,000 outstanding.
• Bardoli Holdings Corp., 4/9/2021: $3,120,000 principal; $474,000 outstanding.

• Pursuant to a Subordination Agreement dated as of June 25, 2021, as amended and restated on July 15, 2024, each of the Unsecured Noteholders other than Bardoli Holdings Corp. subordinated the debt payable to them under the Shareholder Notes to the Prepetition Term Loan Secured Parties.

Real Property Leases

• As of the Petition Date, the Debtors are party to eleven real property leases with nine different landlords, relating to the Company's locations in Fort Lauderdale, Fort Worth, Irving, Las Vegas, Madrid, Orlando, Minneapolis, Monterrey, and Medellin. The Company subleases portions of nine of the Leased Premises to certain of its customers.
• The Debtors pay approximately $370,000 per month in rent on account of the Real Property Leases and receive approximately $140,000 per month in rent from sublessors of the Leased Premises.
• As of the Petition Date, the Debtors owe approximately $255,000 to certain of the Lessors on account of their obligations under the Real Property Leases.

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Events Leading to Bankruptcy

Unsustainable Debt Load

Avenger's rapid growth was accompanied by a burgeoning debt load. With a limited supply of new FFSes—by some estimates, only approximately 50 new FFSes are made yearly—and high initial capital costs potentially in excess of $10 million for a new FFS, the Company's debt load associated with its growth has become unsustainable.

• The Company maintains that, with a rationalized balance sheet and focused geographic footprint, Avenger's long-term prospects are strong, noting that new FFSes can hold value in excess of 60% of initial cost over a decade after acquisition and, with proper maintenance and certification renewals, may have a service life in excess of a quarter century.

Industry Headwinds and Customer Bankruptcies

The Company has also faced unexpected industry headwinds, creating further pressure on its balance sheet. Avenger focused on operating FFSes for the Airbus A320, the most popular aircraft type ever and the one used most commonly by the Company's LCC customer base; as of the Petition Date, over 55% of the Company's owned and operated FFSes are A320s.

• On July 25, 2023, RTX Corporation, the parent company of Pratt & Whitney, announced that it had determined that a condition in the manufacturing of certain engine parts used in the PW1100G-JM geared turbofan engines—the engines used to power A320neo aircraft—required accelerated inspection and repair. Hundreds of A320neo aircraft have been, and are expected to be, grounded for inspection and repair, and the airline industry has in turn temporarily decreased hiring of new crews to fly the A320, causing decreased demand for commercial aviation training for that make and model.
• Headwinds in the LCC airline industry have further strained the Debtors' operations, most notably the two chapter 11 filings of Avenger's once-largest customer, Spirit Airlines, in 2024 and 2025.
• The Company exited Cancun in 2024 after its main customer at that location, Interjet, was adjudicated bankrupt in Mexico in 2022.
• In early 2023, Viva Air Colombia, the Company's partner in Colombia, suddenly commenced bankruptcy proceedings and liquidated. Avenger has since had no operations in Medellin for nearly three years, although it continues to accrue liabilities related to the Leased Premises and two FFSes subject to the EDC Facilities.

Defaults Related to German Operations

When Avenger Germany entered into the applicable SIM International Agreements for the operational lease of FFSes to be located in Frankfurt, the Company lacked the liquidity to pay large down payments to SIM International for the three new FFSes. To facilitate the transactions, the Company and SIM International entered into agreements (the "SIM International Germany Agreements") under which the Company assigned revenues generated from its Frankfurt operations to SIM International to secure repayment of those down payments, among other things.

• Avenger defaulted under the SIM International Germany Agreements, both as a result of a payment default to SIM International and due to the Company's failure to pay rent to its third-party landlord, which under German law gave the landlord the right to cancel the lease.
• On or about August 12, 2025, SIM International notified Avenger that it was exercising its rights under the SIM International Germany Agreements to, among other things, take over the Company's German customer agreements and assets. As of the Petition Date, the Company effectively has no German operations, and non-Debtor Avenger Germany's continuing obligations, including to its employees, are offset by SIM International on a monthly basis against amounts owed by Avenger Germany to SIM International.

Prepetition Financial, Operational, and Organizational Restructuring

Beginning in 2023, Avenger explored opportunities to streamline its balance sheet through a recapitalization or other financing transaction. Through 2023 and 2024, the Company received interest from new financing sources, though none of the proposals were actionable, as none came close to providing sufficient financing to address the Company's existing Prepetition Term Loan Obligations.

• Through that process, Avenger reached agreement with its existing stakeholders on the terms of restructuring transactions consummated in July 2024 (the "2024 Restructuring"), through which the Company refinanced its secured term loan facility with its existing lenders and obtained equity financing. Following the 2024 Restructuring, the relevant equity holders, who previously owned approximately 45% of the Company's equity, owned 96.69%.
• Topco's board of managers (the "Board") thereafter consisted of six individuals—two appointed by Seacoast (the "Seacoast Managers"), two appointed by Patriot (the "Patriot Managers"), and two appointed by the Prepetition Term Loan Lenders (the "Creditor Managers").

Following the 2024 Restructuring, several members of senior management were relieved of their positions, including the former CEO, CFO, and Vice President of Finance. The Company subsequently rebuilt its leadership and advisory bench:

• In March 2025, Marc Sullivan, an experienced financial professional with a substantial background in turnaround situations, was appointed Chief Financial Officer.
• In April 2025, Hooman Yazhari was retained as an advisor to the Board and Board observer, and was given the title of Chairman.
• In May 2025, the Company retained SierraConstellation Partners, LLC ("SCP") as a consultant to assist with the preparation of cash flow models.
• Shortly after their appointment, the new management team discovered significant accounting irregularities that affected all financial statements, insufficient financial controls, and inadequate processes. Management has since worked to accurately restate the Company's financials and implement proper processes and controls, which as of the Petition Date have been successfully implemented at all of the Debtors and continue to be implemented at certain Foreign Non-Debtor Subsidiaries. None of the finance or accounting personnel responsible for the prior irregularities and lack of controls remain employed by the Company.

Avenger concurrently worked to right-size its operations. Between 2022 and the Petition Date, the Company's nascent and planned operations in Italy, Saudi Arabia, India, and Portugal were wound down, and in 2025 the Company sold its operations in Warsaw, Poland and Tel Aviv, Israel to its partners in each country.

Stakeholder Negotiations and Governance Changes

In August 2025, following certain undisputed events of default, the Prepetition Term Loan Agent exercised post-default rights under the Pledge and Security Agreement dated as of June 25, 2021 and appointed Lawrence Perkins as independent manager of AFG LLC and each of its subsidiaries. Mr. Perkins thereafter member-managed AFG LLC and its subsidiaries while the Board continued to manage Topco. Mr. Perkins has stated that he has no prior connection to the Prepetition Term Loan Secured Parties of which he is aware, and understands that Mr. Yazhari has no such prior connection.

• Starting around mid-October 2025, as its liquidity situation became more acute, the Company began engaging with the Prepetition Term Loan Secured Parties regarding a comprehensive restructuring.
• To ensure operations continued without interruption, in connection with the fifteenth and sixteenth amendments to the Prepetition Credit Agreement, the Prepetition Term Loan Secured Parties provided the Debtors with $11 million in new liquidity in the form of bridge financing—$5 million in September 2025 and $6 million in December 2025. Absent this bridge financing, the Debtors state they would have been required to seek a larger DIP facility and commence chapter 11 cases earlier, without the benefit of consensual resolutions with key stakeholders and in a rushed and less organized fashion.
• The Debtors and the Prepetition Term Loan Secured Parties engaged in a series of negotiations over several months regarding the contours of a comprehensive restructuring involving the commencement of these Chapter 11 Cases to execute a value-maximizing sale of the Debtors' assets free and clear of all encumbrances.

Concurrently, the Company engaged in arm's-length discussions with SIM International, which had noticed alleged defaults under the SIM International Agreements in February 2024 and August 2025 and had taken action with respect to the Company's German operations. Those discussions culminated in the SIM International Settlement, which includes significant concessions from SIM International and secures an ongoing relationship with improved equipment to support Avenger's turnaround and growth plan. The settlement, which will be the subject of a forthcoming motion, provides:

• The Company will make the Lease Cure Payment to SIM International upon the closing of a Sale, equal to the aggregate remaining amount of payments due from the Company to SIM International under the SIM International Agreements as of the Petition Date.
• Upon the closing of the settlement agreement, the Company's obligations under the Frankfurt SIM International Agreements will be deemed to have terminated as of August 19, 2025.
• The Company and SIM International will mutually terminate or reject the SIM International Agreement for the FFS in Israel.
• The SIM International Agreements for the FFSes in Spain will remain in full force and effect, with the Company or NewCo, as applicable, assuming certain obligations contained in related agreements.
• The Debtors will assume, and as applicable assign to NewCo, the SIM International Agreements related to four Airbus A320 FFSes in the United States, with each party making material concessions—for example, SIM International will perform upgrades to such FFSes at its own expense.
• The Debtors will transfer all rights in four A320 FFSes to SIM International, which will perform upgrades thereon at its own expense and lease such FFSes to the Company or NewCo, as applicable.

Avenger experienced additional governance changes in the months leading to the Petition Date:

• On November 14, 2025, Seacoast and Patriot abruptly informed the Company that they were exercising their put options and abandoning the equity they had received in the 2024 Restructuring, and that the four Seacoast Managers and Patriot Managers were resigning from the Board.
• On November 21, 2025, the two Creditor Managers resigned and the Prepetition Term Loan Lenders appointed Mr. Perkins as the sole independent manager of the Board.
• On January 12, 2026, Mr. Perkins resigned as manager of the Board and was named CRO of the Company as of January 20, 2026. As of January 13, 2026, Mr. Yazhari was named the sole independent manager of the Board and, in connection therewith, resigned from all existing positions he held with the Company, including his role as Chairman, and waived all rights and claims he may have had against the Company arising prior to his appointment as Independent Manager.

Chapter 11 Filing, DIP Financing, and Sale Process

The Company has faced both internal and external challenges, including a high debt load, general industry headwinds, and the bankruptcies of some of its major customers. In the months leading up to the Petition Date, the Debtors engaged with many of their major stakeholders—including the Prepetition Term Loan Secured Parties, SIM International, and key equipment lessors—regarding a holistic restructuring to be effectuated through the chapter 11 process. Each of the Debtors commenced a voluntary case under chapter 11 in the U.S. Bankruptcy Court for the District of Delaware and will continue to operate their business and manage their properties as debtors in possession.

• As of the Petition Date, the Debtors secured a commitment for a $43.5 million senior secured superpriority debtor-in-possession financing facility, which includes $14.5 million in new money, to be provided by the Prepetition Term Loan Secured Parties and secured by liens on substantially all of the Debtors' assets. The DIP Facility is designed to bridge the Debtors to the closing of a value-maximizing sale.
  • The Debtors negotiated with the DIP Lenders and Prepetition Term Loan Lenders to develop a 13-week budget approved by the Required DIP Lenders, setting forth projected cash receipts and cash disbursements, as well as a sale timeline that would induce the DIP Lenders to commit to the facility and the Prepetition Term Loan Lenders to consent to the use of Cash Collateral.
  • Prior to the Petition Date, the Debtors' advisors prepared a teaser describing the DIP loan opportunity and approached various alternative funding sources. None of these potential third-party lenders were prepared to offer debtor-in-possession financing, particularly on a junior basis to the existing Prepetition Term Loan Obligations. Fully unsecured postpetition financing was not available, and other potential sources, including on a junior secured basis, were likewise unavailable.
  • Absent the funding available under the DIP Facility and immediate access to Cash Collateral, the Debtors state they would be unable to sustain operations, pay their employees or vendors, or achieve a successful restructuring through the chapter 11 process.
• The Debtors have filed the Bid Procedures Motion seeking, among other things, approval of procedures for the marketing and ultimate sale of their assets and for a designee or designees of the Prepetition Term Loan Secured Parties (the "Stalking Horse Bidder") to serve as stalking horse bidder, pursuant to a credit bid, for the purchase of substantially all of the Debtors' assets, subject to a court-approved overbidding process.
  • Negotiations with the Stalking Horse Bidder were conducted at arm's length and in good faith, with the Debtors and the Stalking Horse Bidder each represented by separate counsel.
  • The proposed dates governing the sale, marketing, and auction process are within the milestones required under the DIP financing; the Debtors state that failure to adhere to these milestones could compromise their ability to maximize the value of their assets as a going concern.
  • The Stalking Horse APA provides for an Expense Reimbursement of $2,000,000, payment of which is subject to a number of conditions, including that it is payable solely from the proceeds of an "Alternative Transaction" as defined in the Stalking Horse APA.

The Debtors' decision to file these Chapter 11 Cases and pursue the sale process was informed by the challenges they face and several months of exploration and deliberation by the Company's board of directors and management, with the assistance of their advisors, and only after all other alternatives were first considered. The Debtors believe that their significant efforts to reach consensus prior to the Petition Date provide a clear path to realizing a value-maximizing going concern transaction for the benefit of all of their stakeholders.