Entry into a Material Definitive Agreement.

On March 11, 2026, Frontier Airlines, Inc. ("Frontier"), a wholly owned subsidiary of Frontier Group Holdings, Inc. (the "Company"), entered into Amendment No. 20 (the "Amendment") to the A320 Family Aircraft Purchase Agreement, dated September 30, 2011, with Airbus S.A.S. ("Airbus"). The Amendment defers the delivery of 69 A320neo family aircraft that were expected to be delivered between 2027 and 2030 and are now expected to be delivered between 2031 and 2033.

The preceding description is qualified in its entirety by reference to the full text of the Amendment, a copy of which the Company intends to file as an exhibit to its Quarterly Report on Form 10-Q for the quarter ended March 31, 2026.

 

Item 2.05Costs Associated with Exit or Disposal Activities.

Separately, on March 11, 2026, Frontier entered into an agreement with AerCap Holdings N.V. ("AerCap") to terminate the leases associated with 24 A320neo aircraft currently in operation, which were otherwise scheduled to expire in the next two to eight years (the "Early Return Agreement"). These 24 aircraft are expected to be returned during the second quarter of 2026 which will result in a reduction of approximately $400 million in both the Company's operating lease right-of-use assets and operating lease liabilities. Additionally, AerCap agreed to 10 future sale-leaseback transactions for deliveries scheduled for the years 2028 and 2029.

The Early Return Agreement is expected to result in non-cash charges largely comprised of (i) a write-off of non-recoverable capitalized prepaid maintenance balances recorded in other assets and associated with certain engines for which no future maintenance will be performed and (ii) accelerated depreciation related to capitalized maintenance recorded in property, plant and equipment due to shortened useful lives. The Company currently expects to recognize these non-cash charges in the first and second quarters of 2026 and anticipates the charges to range between $125 million and $175 million. Additionally, the Early Return Agreement is expected to result in charges in the range of $75 million to $95 million in connection with early lease termination and return of aircraft and engines to AerCap to be recognized in the first and second quarters of 2026 that will be substantially cash expenditures which will largely be settled in 2028 and 2029.