The ramifications of the Iso-8 impact on Earth forced a massive restructuring of the United States' defense network. At the time, the country's primary peace keeping agency was S.H.I.E.L.D., led by colonel Nick Fury. Due to S.H.I.E.L.D. unable to get the situation under control it was decided that S.H.I.E.L.D. was no longer an effective organization. In the wake of this controversy, Thunderbolts leader Norman Osborn manipulated the U.S. government into allowing him to serve as director of a replacement agency called H.A.M.M.E.R. Under Osborn's leadership, H.A.M.M.E.R. had administrative control over the entire 50-State Initiative.
In an effort to make H.A.M.M.E.R.'s image more palatable to the general public, Osborn reorganized the Avengers, filling their ranks with members of the Thunderbolts. Two previous members of the team who remained on Osborn's Avengers were the Sentry and Ares, the God of War