Avenger Flight Group: Aviation Training Provider Files Chapter 11 Amid Customer Bankruptcies

Avenger Flight Group, a Fort Lauderdale-based commercial aviation training provider, filed for chapter 11 protection in the U.S. Bankruptcy Court for the District of Delaware on February 12, 2026, with first-day filings defining the Petition Date as February 11, 2026. The company reported liabilities between $100 million and $500 million and operates commercial airline training centers across North America, South America, Mexico, and Europe. The filing follows a lender-supported plan to sell its business at a potential chapter 11 auction, with the company blaming its bankruptcy on stress in the budget airline sector.

The filing followed a series of customer bankruptcies that reduced AFG's revenue base. Spirit Airlines — once AFG's largest customer — filed chapter 11 for the second time on August 29, 2025, months after emerging from its first bankruptcy on March 12, 2025. Interjet, AFG's main customer at its Cancun facility, was declared bankrupt by a Mexican judge in 2022 after ceasing operations in December 2020, forcing AFG to exit Cancun in 2024. Colombia's Viva Air — which used AFG's Medellin center — stopped flying on February 27, 2023, less than a month after filing for bankruptcy protection, prompting AFG to cease Medellin operations. The loss of these ultra-low-cost carriers, combined with the Pratt & Whitney engine crisis that temporarily reduced demand for A320neo simulator training, left AFG unable to service its debt.

Debtor	Avenger Flight Group, LLC
Court	Delaware
Case Number	26-10183
Petition Date	February 11, 2026
Judge	Mary F. Walrath
Claims Agent	Debtors’ Application for Authorization to Employ and Retain Kurtzman Carson Consultants, LLC dba Verita Global

Sale Process and DIP Financing

AFG is pursuing a Section 363 sale of substantially all assets, with a credit bid stalking horse providing a floor for value under the Sale/Bid Procedures Motion. The stalking horse bidder, AFG Topco, LP, will credit bid $125 million (aggregate) to acquire substantially all of the debtors' assets, covering all DIP obligations outstanding at closing and a portion of prepetition term loan obligations under the stalking horse APA attached to the motion. The credit bid stands against prepetition term loan debt of not less than $273 million (principal only) described in the First Day Declaration and DIP Motion.

Bid procedures. The proposed bid deadline is not to exceed 50 days after the petition date (approximately April 2, 2026) without stalking horse bidder consent, with a closing deadline of April 12, 2026, as set out in the Sale/Bid Procedures Motion. Qualifying bids must exceed the stalking horse bid by $500,000 plus a $2 million expense reimbursement in cash, with subsequent bidding increments of $500,000 under the proposed bidding procedures. Good faith deposits are set at 10% of the proposed purchase price; the stalking horse bidder is exempt under the sale procedures framework. The stalking horse bidder receives a $2 million expense reimbursement if outbid; break-up fees for other bidders are not permitted under the same motion.

Marketing and outreach. Seabury Securities LLC, the debtors' investment banker, is managing the sale process according to the Cox Declaration. Prior to the petition date, Seabury analyzed the debtors' financial position, prepared marketing and diligence materials, and populated a data room for prospective purchasers, as detailed in the Cox Declaration. Post-petition, Seabury will send a teaser to at least 15 strategic parties and at least 50 financial investors with experience in the aviation training industry under the sale process declaration.

DIP facility. To fund operations during the sale process, AFG secured a senior secured superpriority DIP facility from Wilmington Trust, National Association (as agent), providing $14.5 million in new money plus a $29 million roll-up under the DIP Motion. The facility includes an interim draw of up to $8 million (upon entry of the interim order) and a final draw of up to $6.5 million (upon entry of the final order) as requested in the DIP papers. The roll-up consists of $6 million in bridge loan obligations rolled at the interim stage and $23 million in prepetition term loan obligations rolled at the final stage in the proposed term sheet. The $29 million roll-up represents more than twice the $14.5 million in new money.

DIP pricing. Interest on DIP term loans is set at Term SOFR plus 9.00% per annum, compounded monthly and paid in kind under the DIP Motion. Interest on roll-up loans is Term SOFR plus 9.50% per annum, compounded monthly and paid in kind under the same proposed financing package. The facility carries a 2.00% upfront fee (payable in kind, fully earned upon entry of the interim order) and a 2.00% exit fee (payable in kind on the maturity date, subject to final order approval) as reflected in the DIP term sheet. No DIP financing fees are earned on account of any roll-up loans.

DIP maturity. The maturity date is the earliest of: (i) 90 days following the petition date (approximately May 12, 2026), (ii) 30 days following the petition date if the final order has not been entered, (iii) consummation of a sale of all or substantially all assets, (iv) termination of the stalking horse APA for material breach by a seller (without required DIP lender consent), (v) the effective date of a plan of reorganization or liquidation, (vi) court order approving conversion/dismissal or appointment of a trustee/examiner, or (vii) acceleration of DIP obligations, all as specified in the DIP Motion.

Post-petition developments. The court entered the DIP Interim Order on February 13, 2026, approving the $8 million interim draw and rolling up $6 million in bridge loan obligations. The Ad Hoc Group of 1L Lenders filed a Rule 2019 Statement on the same date, disclosing holdings totaling ~$273 million in prepetition term loan claims — Marathon Asset Management at $131.6 million, Arbour Lane Capital at $87.7 million, Cercano Management at $40.7 million, and MidOcean Credit Fund at $13.1 million. The four firms' combined holdings of ~$273 million account for the full prepetition term loan balance, and each has committed to DIP new money. The U.S. Trustee objected to the bid procedures on February 24, 2026.

SIM International settlement. The debtors filed a settlement motion on the petition date seeking approval of a comprehensive agreement with SIM International B.V. and the prepetition lenders. Under the proposed terms, AFG will pay a lease cure of €626,173.77 and transfer SIM Industries A320 full-flight simulators to SIM for €1.00 per unit, followed by a 10-year operational leaseback. SIM USA FFS leases will be assumed by the debtors and assigned to the purchaser's designee. The agreement includes broad mutual releases among the debtors, SIM, and the lenders.

Company Background and Operations

AFG was established in 2013 in Fort Lauderdale, Florida and grew to become the largest privately-owned training organization in the Americas. The company operates a fleet of 50 full-flight simulators and 15 flight training devices across 11 training centers in four countries, serving the commercial aviation pilot training pipeline. As of the petition date, AFG's training centers are located in Fort Lauderdale, Dallas (two locations), Las Vegas, Orlando, Minneapolis, Mexico City, Monterrey, Madrid, Frankfurt, and Tel-Aviv. The company also provides cabin crew training services.

Expansion timeline. In 2014, AFG opened centers in Las Vegas (serving Spirit and Allegiant Air) and Mexico City (Boeing 787 simulator, EMB 170 FTD). The company opened its Dallas facility near DFW Airport in 2016. In 2018, AFG opened a Cancun center that closed in November 2024. In 2019, the company opened facilities in Monterrey (exclusive agreement with Viva Aerobus), Madrid, and Medellin (which ceased operations post-bankruptcy). In 2020, AFG opened Dallas 2 as a 120,000-square-foot facility, and also opened Rome (no longer in portfolio) and Warsaw centers. The company opened an Orlando facility in 2021 and a Minneapolis center (serving Sun Country Airlines) in 2022. In 2024, AFG opened centers in Frankfurt and Tel-Aviv (partnership with El Al).

Business model. AFG generates revenue through several contract structures. Under the Dedicated Provider model, customers commit to exclusivity for advanced flight simulator training (e.g., Spirit Airlines, Aeromexico). The Take-or-Pay structure requires customers to pay a fixed monthly rate for simulator access (e.g., Viva Aerobus). The Minimum Guarantee model commits airlines to a minimum number of hours per year (e.g., Frontier Airlines). The Power by the Hour model allows airlines to utilize excess hourly capacity on an as-needed basis (e.g., Avelo, Iberia Express). The company operates simulators and flight training devices for Airbus (A320 family), Boeing (767, 777), Embraer (170), and ATR aircraft.

Workforce. As of the petition date, AFG employs approximately 97 employees across the United States (per the First Day Declaration) and approximately 106 employees (95 salaried and 11 hourly, per the Wages Motion). The company also engages approximately 13 independent contractors, primarily for flight training services.

Funding history. In May 2016, Seacoast Capital financing (with Patriot Capital) supported capitalization of the Dallas training center and continued expansion. In June 2021, Marathon Asset Management led a $155 million credit facility to AFG, with Arbour Lane, Vulcan Capital, and MidOcean Credit Partners rounding out the lending syndicate. AFG raised $180 million in funding.

Key partnerships. In August 2020, AFG signed a seven-year agreement with ATSG to provide overflow Boeing 767 and 777 flight training services, with the option to extend for three additional years.

Path to Financial Distress

AFG's distress resulted from a combination of factors described in the First Day Declaration: unsustainable debt driven by rapid expansion, the loss of multiple major customers, reduced training demand from the Pratt & Whitney engine crisis, and operational setbacks including the loss of German operations and accounting irregularities.

Unsustainable debt load. The company's rapid growth from 2013 to 2024 was fueled by high initial capital costs potentially exceeding $10 million per full-flight simulator, resulting in an unsustainable debt burden according to the First Day Declaration. As of the petition date, the prepetition term loan facility carried total outstanding obligations of not less than $273 million (principal only, excluding accrued interest, fees, and expenses) under the DIP Motion.

Customer bankruptcies. Spirit Airlines — once AFG's largest customer — filed chapter 11 on November 18, 2024, emerging on March 12, 2025 after a prepackaged restructuring that converted $795 million of senior secured debt to equity. Spirit filed chapter 11 for the second time on August 29, 2025, months after emerging from its first bankruptcy. Spirit re-entered bankruptcy amid softer U.S. domestic fares and high costs. AerCap sent Spirit a termination notice for 36 future aircraft leases scheduled for delivery between 2027 and 2028, and a default notice on 37 existing leases.

Interjet, the third-largest airline in Mexico and AFG's main customer at its Cancun facility, ceased operations in December 2020. A Mexican judge formally declared Interjet bankrupt in 2022. Former Interjet workers launched a strike and seized assets in January 2021, including airport counters at Mexico City Benito Juárez International. Interjet's bankruptcy forced AFG to exit Cancun in 2024.

Viva Air Colombia, the third-largest airline in Colombia and a customer of AFG's Medellin center, filed for insolvency in February 2023. The airline stopped flying on February 27, 2023, less than a month after filing for bankruptcy protection. The shutdown occurred after Aerocivil initially rejected the Avianca-Viva merger in November 2022 due to competition concerns. The airline had 16 A320 family planes in service the day before it ceased operations. Lessors took back Viva's aircraft as the carrier went into liquidation. AFG ceased operations in Medellin following Viva's liquidation.

Pratt & Whitney engine crisis. On July 25, 2023, RTX announced accelerated inspection requirements for PW1100G-JM geared turbofan engines used in A320neo aircraft, leading to grounded aircraft and temporarily decreased demand for commercial aviation training on that aircraft type. Pratt & Whitney discovered contaminated powdered metal from manufacturing runs between Q4 2015 and Q3 2021 that could cause cracking in high-pressure turbine disks. In July 2023, Pratt announced 200 engines required immediate inspection before regular maintenance, plus 1,000 additional engines within 9-12 months. On September 11, 2023, a major update indicated 600-700 additional shop visits between 2023-2026, with "350 airplanes on the ground" on average. Inspection duration was described as "250 to 300 days" per engine. Roughly 40% of A320neo-family aircraft are powered by PW1100G engines.

RTX (Pratt & Whitney's parent company) recorded a $5.4 billion charge to address the engine issue. The issue contributed to a 21% decrease in RTX's third-quarter sales. The number of affected engines grew to nearly 3,000 potentially affected engines. Over 40 airlines and aircraft lessors globally have been impacted. An estimated 110 inactive A321neo aircraft were reported as powered by the affected engines.

Loss of German operations. AFG defaulted under agreements with SIM International related to its Frankfurt operations, partly due to failure to pay rent to the third-party landlord, as recounted in the First Day Declaration. On approximately August 12, 2025, SIM International exercised rights to take over the company's German customer agreements and assets under the same declaration. As of the petition date, AFG effectively has no German operations. The debtors filed a settlement motion with SIM International on the petition date, proposing a lease cure, simulator transfer, and 10-year leaseback arrangement.

Accounting irregularities. New management discovered significant accounting irregularities, insufficient financial controls, and inadequate processes shortly after their appointment, according to the First Day Declaration.

Loss of revolving credit. Oxford Commercial Finance terminated the $5 million revolving loan agreement on December 29, 2025 under the First Day Declaration. As of the petition date, the debtors do not owe any amounts on the revolving facility.

Governance Upheaval

The path to bankruptcy was marked by governance turnover, with the company cycling through multiple board regimes, equity abandonment by 96.69% owners, and serial management transitions within a seven-month period, as detailed in the First Day Declaration.

2024 restructuring (July 2024). AFG refinanced its secured term loan facility and brought in new equity holders — Seacoast Capital Partners and Patriot Capital according to the First Day Declaration. Pre-restructuring, Seacoast and Patriot owned approximately 45% of the company's equity; post-restructuring, they owned 96.69%. The Board was reconstituted with six members: two Seacoast Managers, two Patriot Managers, and two Creditor Managers appointed by the prepetition term loan lenders.

Independent manager appointment (August 2025). Following undisputed events of default, the prepetition term loan agent appointed Lawrence Perkins as an independent manager of AFG LLC and each of its subsidiaries on August 26, 2025, under the First Day Declaration.

Equity abandonment (November 14, 2025). Seacoast and Patriot exercised put options and abandoned their equity, and all four Seacoast/Patriot Managers resigned from the Board as described in the First Day Declaration. The abandonment by the 96.69% equity holders occurred less than four months after the 2024 restructuring that brought them to majority control.

Creditor manager resignations (November 21, 2025). The two Creditor Managers resigned, leaving Perkins as the sole independent manager of the Board, per the First Day Declaration.

Final management transition (January 2026). Perkins resigned on January 12, 2026 under the First Day Declaration. On January 13, 2026, Hooman Yazhari — who had been appointed as Chairman effective March 24, 2025 — was named sole independent manager. At that time, the company operated 12 owned and operated training centers in 6 countries. On January 20, 2026, the company retained Perkins as chief restructuring officer, with Ben Smith as deputy CRO, as described in the Perkins Declaration.

Prior leadership transitions. In September 2024, Pedro Sors transitioned to Strategic Advisor, and Andres Restrepo was named Interim CEO.

Bridge financing during distress. In September 2025, the company received a $5 million bridge loan from the prepetition term loan secured parties under the First Day Declaration. In December 2025, the company received an additional $6 million bridge loan from the prepetition term loan secured parties. These bridge loans are included in the $29 million DIP roll-up ($6 million rolled at the interim stage) described in the DIP Motion.

First-Day Relief and Operational Continuity

The debtors filed first-day motions covering wages, critical vendors, taxes, insurance, utilities, cash management, and lease rejection. Against prepetition term debt of at least $273 million in principal, first-day payment requests total under $3 million across the operating motions.

Wages and Benefits Motion	Seeks authority for ~$315,000 unpaid compensation, ~$105,000 withholding obligations, ~$50,000 reimbursable expenses, and ~$68,000 employee benefits; interim cap $549,000 and final cap $551,000
Critical/Foreign Vendor Motion	Requests interim cap $85,000 for critical vendors, $10,000 for foreign vendors, and $10,000 for lien claims; final caps $150,000, $15,000, and $30,000; estimated 503(b)(9) claims ~$70,000
Tax Motion	Estimates accrued taxes of ~$1.66 million, including sales/use, property, and franchise tax components
Insurance Motion	Covers an annual premium program of ~$1.4 million, with ~$250,000 financed through AFCO Direct
Utilities Motion	Proposes a utility adequate-assurance deposit of ~$41,311.15
Cash Management Motion	Seeks authority to continue using 18 bank accounts across six institutions, with mBank accounts tied to a Polish VAT refund process
Lease Rejection Motion	Requests immediate rejection of selected leases/contracts, including Orlando and Saudi Arabia sites debtors said were no longer needed for go-forward operations

First-day table sources: Wages Motion, Critical Vendors Motion, Taxes Motion, Insurance Motion, Utilities Motion, Cash Management Motion, and Lease Rejection Motion.

Payroll continuity. The Wages Motion describes 106 employees (95 salaried and 11 hourly) and requests authority to pay prepetition payroll-related obligations to avoid attrition during an accelerated sale period. The motion also covers ordinary employee benefit programs and expense reimbursements.

Vendor and utility controls. The Critical Vendors Motion distinguishes among critical, foreign, lien, and 503(b)(9) buckets, with interim caps of $85,000 for critical vendors, $10,000 for foreign vendors, and $10,000 for lien claims. The Utilities Motion proposes an adequate-assurance deposit of ~$41,311.

Administrative systems and compliance. The Cash Management Motion seeks authority to continue using 18 bank accounts across six institutions, including mBank accounts tied to a Polish VAT refund process. The Tax Motion covers ~$1.66 million in accrued taxes, including ~$1.46 million in property taxes. The Insurance Motion seeks authority to maintain an annual premium program of ~$1.4 million, with ~$250,000 financed through AFCO Direct.

Footprint rationalization. The Lease Rejection Motion requests immediate rejection of leases at Orlando and Saudi Arabia sites that were vacated prior to the petition date.

Key Professionals and Case Administration

As of the petition date, AFG's management team includes sole independent manager Hooman Yazhari (since January 13, 2026), chief restructuring officer Lawrence Perkins of SCP (since January 20, 2026), deputy CRO Ben Smith, CEO Eduardo Carrasco, and CFO Marc Sullivan (since March 2025), as identified in the Perkins Declaration.

Retained professionals. Pachulski Stang Ziehl & Jones LLP serves as debtors' counsel. Seabury Securities LLC is managing the sale process as investment banker. Kurtzman Carson Consultants, LLC dba Verita Global serves as claims and noticing agent. The DIP agent, Wilmington Trust, is represented by Alston & Bird LLP. The Ad Hoc Group of 1L Lenders is represented by Proskauer Rose LLP and Landis Rath & Cobb LLP as local Delaware counsel. SIM International is represented by Freshfields US LLP and Potter Anderson & Corroon LLP.

Case administration. The first-day hearing took place on February 13, 2026 before Judge Walrath, with all first-day interim orders entered the same day. The court set omnibus hearing dates for March 6, 2026 and March 13, 2026. The Section 341 meeting of creditors is noticed for March 12, 2026.

Frequently Asked Questions

Why did Avenger Flight Group file for bankruptcy?

AFG filed for bankruptcy due to a combination of factors: unsustainable debt from rapid expansion (potentially exceeding $10 million per full-flight simulator), the loss of multiple major customers (Spirit Airlines' chapter 22, Interjet's 2022 bankruptcy, Viva Air Colombia's 2023 liquidation), the Pratt & Whitney engine crisis that temporarily reduced demand for A320neo simulator training, the loss of German operations to SIM International, and accounting irregularities discovered by new management.

What is Avenger Flight Group's business?

AFG is a global commercial aviation simulation and flight training provider operating a fleet of 50 full-flight simulators and 15 flight training devices across 11 training centers in four countries (United States, Mexico, Spain, and Israel). The company provides type rating and recurrent training for commercial airline pilots, primarily serving ultra-low-cost carriers and major airlines. AFG generates revenue through dedicated provider contracts, take-or-pay agreements, minimum guarantee commitments, and power-by-the-hour capacity sales.

How many employees does Avenger Flight Group have?

As of the petition date, AFG employs approximately 97 to 106 employees (sources vary slightly) across the United States, plus approximately 13 independent contractors primarily engaged for flight training services. The company filed a first-day motion seeking to pay approximately $315,000 in prepetition unpaid compensation to employees.

What happened to Spirit Airlines and how did it affect Avenger Flight Group?

Spirit Airlines — once AFG's largest customer — filed chapter 11 on November 18, 2024, emerged on March 12, 2025 after a prepackaged restructuring, and filed chapter 11 for the second time on August 29, 2025. Spirit's two chapter 11 filings within nine months reduced training demand for AFG. Spirit's chapter 22 filing came after softer U.S. domestic fares and high costs that remained after its restructuring, compounded by AerCap's termination of lease agreements covering 36 future aircraft deliveries and notice of default on 37 existing aircraft leases.

What was the Pratt & Whitney engine crisis and how did it impact Avenger Flight Group?

On July 25, 2023, RTX Corporation announced accelerated inspection and repair requirements for PW1100G-JM geared turbofan engines used in A320neo aircraft due to contaminated powdered metal discovered in manufacturing. The crisis led to grounded aircraft and temporarily decreased demand for commercial aviation training on that aircraft type, affecting AFG given that approximately 40% of A320neo family aircraft are powered by PW1100G engines. RTX recorded a $5.4 billion charge to address the issue, and nearly 3,000 engines were potentially affected, with over 40 airlines and aircraft lessors globally impacted.

What is the stalking horse bid in Avenger Flight Group's bankruptcy?

The stalking horse bidder, AFG Topco, LP, will credit bid $125 million (aggregate) to acquire substantially all of the debtors' assets. The credit bid will cover all DIP obligations outstanding at closing and a portion of prepetition term loan obligations. The stalking horse bidder receives a $2 million expense reimbursement if outbid. Qualifying overbids must exceed the stalking horse bid by $500,000 plus the $2 million expense reimbursement in cash, with subsequent bidding increments of $500,000. The bid deadline is approximately April 2, 2026, with a closing deadline of April 12, 2026.

What happened to Avenger Flight Group's operations in Germany, Medellin, and Cancun?

AFG defaulted under agreements with SIM International related to its Frankfurt operations, partly due to failure to pay rent. On approximately August 12, 2025, SIM International exercised rights to take over the company's German customer agreements and assets; as of the petition date, AFG effectively has no German operations. AFG ceased operations in Medellin following the February 2023 liquidation of Viva Air Colombia, which filed for insolvency and stopped flying less than a month later. AFG exited Cancun in 2024 following the 2022 bankruptcy of Interjet, which was the facility's main customer.

Who is the claims agent for Avenger Flight Group?

Kurtzman Carson Consultants, LLC dba Verita Global serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest.

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