Brazilian airline Azul S.A. has reached an agreement with the Official Committee of Unsecured Creditors and a group of secured noteholders, marking a major milestone in its ongoing Chapter 11 restructuring process in the United States.
Under the deal, unsecured creditors will have the option to receive either a share of up to US$20 million in cash or an interest in a trust fund created for their benefit. Azul will contribute to this “GUC Trust” a package that includes warrants valued at a company equity of US$3.8 billion—representing up to 5.5% of the airline’s equity once it emerges from restructuring.
The trust will also have rights to receive three annual payments of up to US$6.5 million between 2027 and 2029, dependent on Azul meeting specific financial performance targets, as well as US$2.5 million to US$5 million to cover trustee and administrative expenses.
Azul noted that the value of warrants contributed will be adjusted based on any cash recoveries taken by unsecured creditors instead of trust participation. The agreement also establishes a “convenience class” under the company’s reorganisation plan to simplify smaller creditor claims.
The company said the deal “represents a significant milestone” towards completing its restructuring, paving the way for a “consensual and orderly resolution” that preserves flight operations, strengthens its capital structure, and provides sustainable long-term value to stakeholders.
Azul also filed a revised version of its reorganisation plan and an updated disclosure statement with the US Bankruptcy Court for the Southern District of New York. The documents outline how the airline intends to treat various creditor groups and summarise key details of the plan.
The airline stressed that the information in the disclosure statement should not be interpreted as financial projections or investment guidance, but as documentation prepared solely for court purposes within the Chapter 11 process.
Azul’s restructuring has been underway since May 2025, when it signed Restructuring Support Agreements with its key lenders and strategic partners. The company continues to operate normally as it seeks to emerge from bankruptcy with a stronger financial foundation.
