Form 20-F ☒
|
Form 40-F ☐
|
Exhibit
|
Title
|
99.1
|
Fly Leasing Limited’s interim report for the three and six months ended June 30, 2019.
|
4.1
|
Purchase Agreement dated July 2, 2019 among the sellers identified therein, Horizon Aircraft Finance II Limited, Horizon Aircraft Finance II LLC and the other purchasers identified therein.
|
Fly Leasing Limited
(Registrant)
|
|||
Date: August 23, 2019
|
By:
|
/s/ Colm Barrington
|
|
Colm Barrington
|
|||
Chief Executive Officer and Director
|
Exhibit
|
Title
|
Fly Leasing Limited’s interim report for the three and six months ended June 30, 2019.
|
|
Purchase Agreement dated July 2, 2019 among the sellers identified therein, Horizon Aircraft Finance II Limited, Horizon Aircraft Finance II LLC and the other purchasers identified therein.
|
Page
|
|
PART I FINANCIAL INFORMATION
|
|
3
|
|
27 | |
36 | |
37 | |
PART II OTHER INFORMATION
|
|
37 | |
37 | |
38 | |
38 | |
38 | |
38 | |
38 |
June 30, 2019
|
December 31, 2018
|
|||||||
Assets
|
||||||||
Cash and cash equivalents
|
$
|
351,892
|
$
|
180,211
|
||||
Restricted cash and cash equivalents
|
63,161
|
100,869
|
||||||
Rent receivables
|
5,864
|
9,307
|
||||||
Investment in finance lease, net
|
12,238
|
12,822
|
||||||
Flight equipment held for sale, net
|
320,359
|
259,644
|
||||||
Flight equipment held for operating lease, net
|
2,788,459
|
3,228,018
|
||||||
Maintenance rights
|
251,797
|
298,207
|
||||||
Deferred tax asset, net
|
16,740
|
6,505
|
||||||
Fair value of derivative assets
|
4,540
|
5,929
|
||||||
Other assets, net
|
130,170
|
124,960
|
||||||
Total assets
|
$
|
3,945,220
|
$
|
4,226,472
|
||||
Liabilities
|
||||||||
Accounts payable and accrued liabilities
|
$
|
23,232
|
$
|
23,146
|
||||
Rentals received in advance
|
16,431
|
21,322
|
||||||
Payable to related parties
|
6,593
|
4,462
|
||||||
Security deposits
|
47,991
|
60,097
|
||||||
Maintenance payment liability, net
|
267,006
|
292,586
|
||||||
Unsecured borrowings, net
|
618,535
|
617,664
|
||||||
Secured borrowings, net
|
2,062,047
|
2,379,869
|
||||||
Deferred tax liability, net
|
52,711
|
36,256
|
||||||
Fair value of derivative liabilities
|
31,621
|
8,558
|
||||||
Other liabilities
|
65,390
|
80,402
|
||||||
Total liabilities
|
3,191,557
|
3,524,362
|
||||||
Shareholders’ equity
|
||||||||
Common shares, $0.001 par value; 499,999,900 shares authorized; 31,038,292 and 32,650,019 shares issued and outstanding at June 30, 2019 and December 31, 2018,
respectively
|
31
|
33
|
||||||
Manager shares, $0.001 par value; 100 shares authorized, issued and outstanding
|
—
|
—
|
||||||
Additional paid-in capital
|
522,050
|
549,123
|
||||||
Retained earnings
|
253,530
|
154,347
|
||||||
Accumulated other comprehensive loss, net
|
(21,948
|
)
|
(1,393
|
)
|
||||
Total shareholders’ equity
|
753,663
|
702,110
|
||||||
Total liabilities and shareholders’ equity
|
$
|
3,945,220
|
$
|
4,226,472
|
Three months
ended
June 30, 2019
|
Three months
ended
June 30, 2018
|
Six months
ended
June 30, 2019
|
Six months
ended
June 30, 2018
|
|||||||||||||
Revenues
|
||||||||||||||||
Operating lease revenue
|
$
|
128,623
|
$
|
99,324
|
$
|
233,875
|
$
|
186,400
|
||||||||
Finance lease revenue
|
156
|
171
|
316
|
345
|
||||||||||||
Equity earnings (loss) from unconsolidated subsidiary
|
54
|
(358
|
)
|
110
|
(246
|
)
|
||||||||||
Gain on sale of aircraft
|
16,078
|
2,945
|
43,698
|
2,945
|
||||||||||||
Interest and other income
|
2,122
|
591
|
3,737
|
1,984
|
||||||||||||
Total revenues
|
147,033
|
102,673
|
281,736
|
191,428
|
||||||||||||
Expenses
|
||||||||||||||||
Depreciation
|
37,303
|
33,895
|
74,888
|
67,628
|
||||||||||||
Interest expense
|
35,439
|
33,644
|
73,618
|
66,567
|
||||||||||||
Selling, general and administrative
|
9,438
|
6,369
|
18,160
|
14,979
|
||||||||||||
Loss (gain) on derivatives
|
255
|
(1,309
|
)
|
272
|
(520
|
)
|
||||||||||
Loss on extinguishment of debt
|
1,541
|
898
|
3,710
|
898
|
||||||||||||
Maintenance and other costs
|
1,625
|
936
|
2,223
|
1,714
|
||||||||||||
Total expenses
|
85,601
|
74,433
|
172,871
|
151,266
|
||||||||||||
Net income before provision for income taxes
|
61,432
|
28,240
|
108,865
|
40,162
|
||||||||||||
Provision for income taxes
|
7,382
|
3,896
|
9,850
|
6,188
|
||||||||||||
Net income
|
$
|
54,050
|
$
|
24,344
|
$
|
99,015
|
$
|
33,974
|
||||||||
Weighted average number of shares:
|
||||||||||||||||
Basic
|
32,053,830
|
27,983,352
|
32,341,674
|
27,983,352
|
||||||||||||
Diluted
|
32,187,115
|
28,045,890
|
32,396,717
|
28,023,419
|
||||||||||||
Earnings per share:
|
||||||||||||||||
Basic
|
$
|
1.69
|
$
|
0.87
|
$
|
3.06
|
$
|
1.21
|
||||||||
Diluted
|
$
|
1.68
|
$
|
0.87
|
$
|
3.06
|
$
|
1.21
|
Three months
ended
June 30, 2019
|
Three months
ended
June 30, 2018
|
Six months
ended
June 30, 2019
|
Six months
ended
June 30, 2018
|
|||||||||||||
Net income
|
$
|
54,050
|
$
|
24,344
|
$
|
99,015
|
$
|
33,974
|
||||||||
Other comprehensive income, net of tax
|
||||||||||||||||
Change in fair value of derivatives, net of deferred tax (1)
|
(14,113
|
)
|
7,350
|
(21,051
|
)
|
8,801
|
||||||||||
Reclassification from other comprehensive loss into earnings due to derivatives that no longer qualified for hedge accounting treatment, net of deferred tax (2)
|
203
|
1,042
|
664
|
1,764
|
||||||||||||
Comprehensive income
|
$
|
40,140
|
$
|
32,736
|
$
|
78,628
|
$
|
44,539
|
(1) |
The associated deferred tax expense was $2.5 million and $3.9 million for the three and six months ended June 30, 2019, respectively. The associated deferred tax expense was $1.0 million and $1.3 million
for the three and six months ended June 30, 2018, respectively.
|
(2) |
The associated deferred tax expense was $0.1 million for each of the three and six months ended June 30, 2019 and 2018.
|
|
|
Manager
Shares
|
|
|
Common Shares
|
|
|
Additional
Paid-in
Capital
|
|
|
Retained
Earnings
|
|
|
Accumulated
Other
Comprehensive
Loss, net
|
|
|
Total
Shareholders’
Equity
|
|
||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||||||
Balance December 31, 2018
|
100
|
$
|
—
|
32,650,019
|
$
|
33
|
$
|
549,123
|
$
|
154,347
|
$
|
(1,393
|
)
|
$
|
702,110
|
|||||||||||||||||
Reclassification from prior period losses into other comprehensive loss due to adoption of new accounting guidance, net of deferred tax of $0.1
million
|
—
|
—
|
—
|
—
|
—
|
168
|
(168
|
)
|
—
|
|||||||||||||||||||||||
Adjusted balance January 1, 2019
|
100
|
—
|
32,650,019
|
33
|
549,123
|
154,515
|
(1,561
|
)
|
702,110
|
|||||||||||||||||||||||
Shares repurchased
|
—
|
—
|
(197,592
|
)
|
(1
|
)
|
(2,694
|
)
|
—
|
—
|
(2,695
|
)
|
||||||||||||||||||||
Net income
|
—
|
—
|
—
|
—
|
—
|
44,965
|
—
|
44,965
|
||||||||||||||||||||||||
Net change in the fair value of derivatives, net of deferred tax of $1.3 million (1)
|
—
|
—
|
—
|
—
|
—
|
—
|
(6,938
|
)
|
(6,938
|
)
|
||||||||||||||||||||||
Reclassification from other comprehensive loss into earnings due to derivatives that no longer qualified for hedge accounting treatment, net of deferred tax of $37,000 (1)
|
—
|
—
|
—
|
—
|
—
|
—
|
461
|
461
|
||||||||||||||||||||||||
Balance March 31, 2019
|
100
|
—
|
32,452,427
|
32
|
546,429
|
199,480
|
(8,038
|
)
|
737,903
|
|||||||||||||||||||||||
Shares issued in connection with SARs exercised
|
—
|
—
|
56,218
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||||||||||||
Shares repurchased
|
—
|
—
|
(1,470,353
|
)
|
(1
|
)
|
(24,379
|
)
|
—
|
—
|
(24,380
|
)
|
||||||||||||||||||||
Net income
|
—
|
—
|
—
|
—
|
—
|
54,050
|
—
|
54,050
|
||||||||||||||||||||||||
Net change in the fair value of derivatives, net of deferred tax of $2.5 million (1)
|
—
|
—
|
—
|
—
|
—
|
—
|
(14,113
|
)
|
(14,113
|
)
|
||||||||||||||||||||||
Reclassification from other comprehensive loss into earnings due to derivatives that no longer qualified for hedge accounting treatment, net of deferred tax of $0.1 million (1)
|
—
|
—
|
—
|
—
|
—
|
—
|
203
|
203
|
||||||||||||||||||||||||
Balance June 30, 2019
|
100
|
$
|
—
|
31,038,292
|
$
|
31
|
$
|
522,050
|
$
|
253,530
|
$
|
(21,948
|
)
|
$
|
753,663
|
(1) |
See Note 10 to Notes to Consolidated Financial Statements.
|
|
Manager
Shares
|
|
|
Common Shares
|
|
|
Additional
Paid-in
Capital
|
|
|
Retained
Earnings
|
|
|
Accumulated
Other
Comprehensive
Income
(Loss), net
|
|
|
Total
Shareholders’
Equity
|
|
|||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||||||
Balance December 31, 2017
|
100
|
$
|
—
|
27,983,352
|
$
|
28
|
$
|
479,637
|
$
|
68,624
|
$
|
(4,580
|
)
|
$
|
543,709
|
|||||||||||||||||
Net income
|
—
|
—
|
—
|
—
|
—
|
9,630
|
—
|
9,630
|
||||||||||||||||||||||||
Net change in the fair value of derivatives, net of deferred tax of $0.2 million (1)
|
—
|
—
|
—
|
—
|
—
|
—
|
1,451
|
1,451
|
||||||||||||||||||||||||
Reclassification from other comprehensive loss into earnings due to derivatives that no longer qualified for hedge accounting treatment, net of deferred tax of $0.1 million (1)
|
—
|
—
|
—
|
—
|
—
|
—
|
722
|
722
|
||||||||||||||||||||||||
Balance March 31, 2018
|
100
|
—
|
27,983,352
|
28
|
479,637
|
78,254
|
(2,407
|
)
|
555,512
|
|||||||||||||||||||||||
Net income
|
—
|
—
|
—
|
—
|
—
|
24,344
|
—
|
24,344
|
||||||||||||||||||||||||
Net change in the fair value of derivatives, net of deferred tax of $1.0 million (1)
|
—
|
—
|
—
|
—
|
—
|
—
|
7,350
|
7,350
|
||||||||||||||||||||||||
Reclassification from other comprehensive loss into earnings due to derivatives that no longer qualified for hedge accounting treatment, net of deferred tax of $0.1 million (1)
|
—
|
—
|
—
|
—
|
—
|
—
|
1,042
|
1,042
|
||||||||||||||||||||||||
Balance June 30, 2018
|
100
|
$
|
—
|
27,983,352
|
$
|
28
|
$
|
479,637
|
$
|
102,598
|
$
|
5,985
|
$
|
588,248
|
(1) |
See Note 10 to Notes to Consolidated Financial Statements.
|
Six months ended
|
||||||||
June 30, 2019
|
June 30, 2018
|
|||||||
Cash Flows from Operating Activities
|
||||||||
Net income
|
$
|
99,015
|
$
|
33,974
|
||||
Adjustments to reconcile net income to net cash flows provided by operating activities:
|
||||||||
Finance lease revenue
|
(316
|
)
|
(345
|
)
|
||||
Equity (earnings) loss from unconsolidated subsidiary
|
(110
|
)
|
246
|
|||||
Gain on sale of aircraft
|
(43,698
|
)
|
(2,945
|
)
|
||||
Depreciation
|
74,888
|
67,628
|
||||||
Amortization of debt discounts and debt issuance costs
|
5,369
|
3,961
|
||||||
Amortization of lease incentives and other items
|
3,324
|
5,453
|
||||||
Loss on extinguishment of debt
|
3,710
|
898
|
||||||
Unrealized foreign exchange gain
|
(104
|
)
|
(456
|
)
|
||||
Provision for deferred income taxes
|
9,991
|
6,327
|
||||||
Loss (gain) on derivative instruments
|
198
|
(74
|
)
|
|||||
Security deposits and maintenance payment liability recognized into earnings
|
(26,145
|
)
|
(9,965
|
)
|
||||
Distributions from unconsolidated subsidiary
|
109
|
2,212
|
||||||
Cash receipts from maintenance rights
|
1,741
|
3,013
|
||||||
Changes in operating assets and liabilities:
|
||||||||
Rent receivables
|
(2,011
|
)
|
(2,766
|
)
|
||||
Other assets
|
(3,250
|
)
|
(2,212
|
)
|
||||
Payable to related parties
|
2,131
|
(2,168
|
)
|
|||||
Accounts payable, accrued liabilities and other liabilities
|
(2,054
|
)
|
2,005
|
|||||
Net cash flows provided by operating activities
|
122,788
|
104,786
|
||||||
Cash Flows from Investing Activities
|
||||||||
Distributions from unconsolidated subsidiary
|
205
|
1,275
|
||||||
Rent received from finance lease
|
900
|
900
|
||||||
Swap termination proceeds
|
114
|
—
|
||||||
Investment income from Horizon I Limited equity certificates
|
571
|
—
|
||||||
Purchase of flight equipment
|
(61,381
|
)
|
(69,258
|
)
|
||||
Deposit on aircraft purchases
|
—
|
(30,000
|
)
|
|||||
Proceeds from sale of aircraft, net
|
410,939
|
99,339
|
||||||
Capitalized interest on Portfolio B orderbook
|
(2,433
|
)
|
—
|
|||||
Payments for aircraft improvement
|
(2,832
|
)
|
(170
|
)
|
||||
Payments for lessor maintenance obligations
|
(1,461
|
)
|
(817
|
)
|
||||
Net cash flows provided by investing activities
|
344,622
|
1,269
|
||||||
Cash Flows from Financing Activities
|
||||||||
Security deposits received
|
—
|
1,417
|
||||||
Security deposits returned
|
(1,546
|
)
|
(3,549
|
)
|
||||
Maintenance payment liability receipts
|
33,633
|
38,830
|
||||||
Maintenance payment liability disbursements
|
(12,738
|
)
|
(2,104
|
)
|
||||
Debt extinguishment costs
|
(74
|
)
|
(12
|
)
|
||||
Debt issuance costs
|
(342
|
)
|
(5,534
|
)
|
||||
Proceeds from secured borrowings
|
—
|
49,288
|
||||||
Repayment of secured borrowings
|
(325,317
|
)
|
(175,035
|
)
|
||||
Shares repurchased
|
(27,025
|
)
|
—
|
|||||
Net cash flows used in financing activities
|
(333,409
|
)
|
(96,699
|
)
|
Six months ended
|
||||||||
June 30, 2019
|
June 30, 2018
|
|||||||
Effect of exchange rate changes on unrestricted and restricted cash and cash equivalents
|
$
|
(28
|
)
|
$
|
(47
|
)
|
||
Net increase in unrestricted and restricted cash and cash equivalents
|
133,973
|
9,309
|
||||||
Unrestricted and restricted cash and cash equivalents at beginning of period
|
281,080
|
456,815
|
||||||
Unrestricted and restricted cash and cash equivalents at end of period
|
$
|
415,053
|
$
|
466,124
|
||||
Reconciliation to Consolidated Balance Sheets:
|
||||||||
Cash and cash equivalents
|
$
|
351,892
|
$
|
406,508
|
||||
Restricted cash and cash equivalents
|
63,161
|
59,616
|
||||||
Unrestricted and restricted cash and cash equivalents
|
$
|
415,053
|
$
|
466,124
|
|
• |
The timing and pattern of transfer for the non-lease component and the associated lease component are the same; and
|
|
• |
The stand-alone lease component would be classified as an operating lease if accounted for separately.
|
|
• |
The amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy;
|
|
• |
The policy for timing of transfers between levels; and
|
|
• |
The valuation processes for Level 3 fair value measurements.
|
|
• |
The changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements at the end of the reporting period; and
|
|
• |
The range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements.
|
|
|
Six months ended
|
|
|||||
June 30, 2019
|
June 30, 2018
|
|||||||
(Dollars in thousands)
|
||||||||
Cash paid during the period for:
|
||||||||
Interest
|
$
|
68,624
|
$
|
59,620
|
||||
Taxes
|
120
|
3,880
|
||||||
Noncash Activities:
|
||||||||
Security deposits applied to rent receivables
|
3,224
|
—
|
||||||
Maintenance payment liability applied to rent receivables and other liabilities
|
2,511
|
2,475
|
||||||
Other liabilities applied to maintenance payment liability, security deposits, and rent receivables
|
2,396
|
1,140
|
||||||
Noncash investing activities:
|
||||||||
Aircraft improvement
|
3,662
|
8,257
|
||||||
Noncash activities in connection with purchase of flight equipment
|
470
|
3,578
|
||||||
Noncash activities in connection with sale of flight equipment
|
13,338
|
1,893
|
June 30, 2019
|
December 31, 2018
|
|||||||
Total minimum lease payments receivable
|
$
|
10,500
|
$
|
11,400
|
||||
Estimated unguaranteed residual value of leased asset
|
4,227
|
4,227
|
||||||
Unearned finance income
|
(2,489
|
)
|
(2,805
|
)
|
||||
Net Investment in Finance Lease
|
$
|
12,238
|
$
|
12,822
|
(Dollars in
thousands)
|
||||
July 1 through December 31, 2019
|
$
|
900
|
||
Year ending December 31,
|
||||
2020
|
1,800
|
|||
2021
|
1,800
|
|||
2022
|
1,800
|
|||
2023
|
1,800
|
|||
2024
|
1,800
|
|||
Thereafter
|
600
|
|||
Future minimum rental payments under finance lease
|
$
|
10,500
|
Year ending December 31,
|
(Dollars in
thousands)
|
|||
2019
|
$
|
1,800
|
||
2020
|
1,800
|
|||
2021
|
1,800
|
|||
2022
|
1,800
|
|||
2023
|
1,800
|
|||
Thereafter
|
2,400
|
|||
Future minimum rental payments under finance lease
|
$
|
11,400
|
June 30, 2019
|
December 31, 2018
|
|||||||
Cost
|
$
|
3,441,321
|
$
|
3,900,938
|
||||
Accumulated depreciation
|
(652,862
|
)
|
(672,920
|
)
|
||||
Flight equipment held for operating lease, net
|
$
|
2,788,459
|
$
|
3,228,018
|
June 30, 2019
|
December 31, 2018
|
|||||||||||||||
Europe:
|
||||||||||||||||
Spain
|
$
|
165,033
|
6
|
%
|
$
|
168,534
|
5
|
%
|
||||||||
United Kingdom
|
142,809
|
5
|
%
|
169,763
|
5
|
%
|
||||||||||
Other
|
223,757
|
8
|
%
|
265,554
|
9
|
%
|
||||||||||
Europe — Total
|
531,599
|
19
|
%
|
603,851
|
19
|
%
|
||||||||||
Asia and South Pacific:
|
||||||||||||||||
India
|
580,363
|
21
|
%
|
690,193
|
21
|
%
|
||||||||||
Malaysia
|
408,483
|
15
|
%
|
394,441
|
12
|
%
|
||||||||||
Philippines
|
270,573
|
10
|
%
|
276,237
|
9
|
%
|
||||||||||
Indonesia
|
224,711
|
8
|
%
|
296,390
|
9
|
%
|
||||||||||
China
|
173,083
|
6
|
%
|
177,393
|
5
|
%
|
||||||||||
Other
|
45,516
|
1
|
%
|
161,330
|
6
|
%
|
||||||||||
Asia and South Pacific — Total
|
1,702,729
|
61
|
%
|
1,995,984
|
62
|
%
|
||||||||||
Mexico, South and Central America — Total
|
38,942
|
2
|
%
|
58,202
|
2
|
%
|
||||||||||
North America:
|
||||||||||||||||
United States
|
122,651
|
4
|
%
|
126,498
|
4
|
%
|
||||||||||
Other
|
24,978
|
1
|
%
|
49,320
|
1
|
%
|
||||||||||
North America — Total
|
147,629
|
5
|
%
|
175,818
|
5
|
%
|
||||||||||
Middle East and Africa:
|
||||||||||||||||
Ethiopia
|
308,057
|
11
|
%
|
312,977
|
10
|
%
|
||||||||||
Other
|
22,251
|
1
|
%
|
81,186
|
2
|
%
|
||||||||||
Middle East and Africa — Total
|
330,308
|
12
|
%
|
394,163
|
12
|
%
|
||||||||||
Off-lease
|
37,252
|
1
|
%
|
—
|
—
|
|||||||||||
Total flight equipment held for operating lease, net
|
$
|
2,788,459
|
100
|
%
|
$
|
3,228,018
|
100
|
%
|
Three months ended
|
||||||||||||||||
June 30, 2019
|
June 30, 2018
|
|||||||||||||||
Europe:
|
||||||||||||||||
Spain
|
$
|
4,345
|
3
|
%
|
$
|
4,345
|
4
|
%
|
||||||||
United Kingdom
|
9,884
|
8
|
%
|
7,848
|
8
|
%
|
||||||||||
Other
|
8,789
|
7
|
%
|
10,401
|
11
|
%
|
||||||||||
Europe — Total
|
23,018
|
18
|
%
|
22,594
|
23
|
%
|
||||||||||
Asia and South Pacific:
|
||||||||||||||||
India
|
44,246
|
34
|
%
|
30,721
|
31
|
%
|
||||||||||
Malaysia
|
13,256
|
10
|
%
|
3,275
|
3
|
%
|
||||||||||
Philippines
|
8,599
|
7
|
%
|
7,768
|
8
|
%
|
||||||||||
Indonesia
|
8,562
|
7
|
%
|
7,244
|
7
|
%
|
||||||||||
China
|
7,500
|
6
|
%
|
5,653
|
6
|
%
|
||||||||||
Other
|
5,720
|
4
|
%
|
2,004
|
2
|
%
|
||||||||||
Asia and South Pacific — Total
|
87,883
|
68
|
%
|
56,665
|
57
|
%
|
||||||||||
Mexico, South and Central America — Total
|
1,776
|
1
|
%
|
2,777
|
3
|
%
|
||||||||||
North America:
|
||||||||||||||||
United States
|
4,084
|
3
|
%
|
4,415
|
4
|
%
|
||||||||||
Other
|
1,561
|
2
|
%
|
1,561
|
2
|
%
|
||||||||||
North America — Total
|
5,645
|
5
|
%
|
5,976
|
6
|
%
|
||||||||||
Middle East and Africa:
|
||||||||||||||||
Ethiopia
|
7,505
|
6
|
%
|
7,505
|
7
|
%
|
||||||||||
Other
|
2,796
|
2
|
%
|
3,807
|
4
|
%
|
||||||||||
Middle East and Africa — Total
|
10,301
|
8
|
%
|
11,312
|
11
|
%
|
||||||||||
Total Operating Lease Revenue
|
$
|
128,623
|
100
|
%
|
$
|
99,324
|
100
|
%
|
Six months ended
|
||||||||||||||||
June 30, 2019
|
June 30, 2018
|
|||||||||||||||
Europe:
|
||||||||||||||||
Spain
|
$
|
8,689
|
4
|
%
|
$
|
8,578
|
5
|
%
|
||||||||
United Kingdom
|
19,313
|
8
|
%
|
15,124
|
8
|
%
|
||||||||||
Other
|
17,758
|
8
|
%
|
22,153
|
12
|
%
|
||||||||||
Europe — Total
|
45,760
|
20
|
%
|
45,855
|
25
|
%
|
||||||||||
Asia and South Pacific:
|
||||||||||||||||
India
|
65,355
|
28
|
%
|
47,805
|
26
|
%
|
||||||||||
Malaysia
|
27,132
|
12
|
%
|
6,154
|
3
|
%
|
||||||||||
Philippines
|
17,299
|
7
|
%
|
15,384
|
8
|
%
|
||||||||||
Indonesia
|
18,555
|
8
|
%
|
14,165
|
8
|
%
|
||||||||||
China
|
12,571
|
5
|
%
|
11,305
|
6
|
%
|
||||||||||
Other
|
11,962
|
5
|
%
|
4,013
|
2
|
%
|
||||||||||
Asia and South Pacific — Total
|
152,874
|
65
|
%
|
98,826
|
53
|
%
|
||||||||||
|
||||||||||||||||
Mexico, South and Central America — Total
|
3,356
|
1
|
%
|
7,169
|
4
|
%
|
||||||||||
North America:
|
||||||||||||||||
United States
|
8,160
|
4
|
%
|
8,809
|
5
|
%
|
||||||||||
Other
|
3,122
|
1
|
%
|
3,123
|
1
|
%
|
||||||||||
North America — Total
|
11,282
|
5
|
%
|
11,932
|
6
|
%
|
||||||||||
Middle East and Africa:
|
||||||||||||||||
Ethiopia
|
15,009
|
6
|
%
|
15,009
|
8
|
%
|
||||||||||
Other
|
5,594
|
3
|
%
|
7,609
|
4
|
%
|
||||||||||
Middle East and Africa — Total
|
20,603
|
9
|
%
|
22,618
|
12
|
%
|
||||||||||
Total Operating Lease Revenue
|
$
|
233,875
|
100
|
%
|
$
|
186,400
|
100
|
%
|
|
|
Three months ended
|
|
|
Six months ended
|
|
||||||||||
June 30, 2019
|
June 30, 2018
|
June 30, 2019
|
June 30, 2018
|
|||||||||||||
(Dollars in thousands)
|
||||||||||||||||
End of lease income
|
$
|
28,823
|
$
|
12,612
|
$
|
30,387
|
$
|
12,997
|
||||||||
Amortization of lease incentives
|
(1,319
|
)
|
(2,361
|
)
|
(2,951
|
)
|
(4,644
|
)
|
(Dollars in
thousands)
|
||||
July 1 through December 31, 2019
|
$
|
168,765
|
||
Year ending December 31,
|
||||
2020
|
310,734
|
|||
2021
|
273,059
|
|||
2022
|
227,952
|
|||
2023
|
188,774
|
|||
2024
|
176,372
|
|||
Thereafter
|
385,455
|
|||
Future minimum rental payments under operating leases
|
$
|
1,731,111
|
Year ending December 31,
|
(Dollars in
thousands)
|
|||
2019
|
$
|
403,535
|
||
2020
|
372,432
|
|||
2021
|
323,232
|
|||
2022
|
272,427
|
|||
2023
|
227,535
|
|||
Thereafter
|
661,006
|
|||
Future minimum rental payments under operating leases
|
$
|
2,260,167
|
Six months ended
|
||||||||
June 30, 2019
|
June 30, 2018
|
|||||||
Maintenance rights, beginning balance
|
$
|
298,207
|
$
|
131,299
|
||||
Acquisitions
|
20,178
|
6,216
|
||||||
Capitalized to aircraft improvements
|
(3,662
|
)
|
(8,209
|
)
|
||||
Maintenance rights settled with retained maintenance payments
|
—
|
(2,159
|
)
|
|||||
Cash receipts from maintenance rights
|
(1,741
|
)
|
(3,013
|
)
|
||||
Maintenance rights associated with aircraft sold
|
(61,185
|
)
|
—
|
|||||
Maintenance rights, ending balance
|
$
|
251,797
|
$
|
124,134
|
|
|
Balance as of
|
|
|||||
June 30, 2019
|
December 31, 2018
|
|||||||
(dollars in thousands)
|
||||||||
Outstanding principal balance:
|
||||||||
2021 Notes
|
$
|
325,000
|
$
|
325,000
|
||||
2024 Notes
|
300,000
|
300,000
|
||||||
Total outstanding principal balance
|
625,000
|
625,000
|
||||||
Unamortized debt discounts and loan costs
|
(6,465
|
)
|
(7,336
|
)
|
||||
Unsecured borrowings, net
|
$
|
618,535
|
$
|
617,664
|
Outstanding principal balance
as of
|
Weighted average
interest rate(1) as of
|
|||||||||||||||||||
June 30,
2019(2)
|
December 31,
2018(2)
|
June 30,
2019
|
December 31,
2018
|
Maturity
date
|
||||||||||||||||
Securitization Notes
|
$
|
—
|
$
|
85,584
|
—
|
3.08
|
%
|
N/A
|
||||||||||||
Nord LB Facility
|
101,185
|
108,882
|
4.25
|
%
|
4.29
|
%
|
January 2020
|
|||||||||||||
Term Loan
|
396,566
|
407,768
|
4.62
|
%
|
5.17
|
%
|
February 2023
|
|||||||||||||
Magellan Acquisition Limited Facility
|
291,955
|
305,226
|
4.17
|
%
|
4.18
|
%
|
December 2025
|
|||||||||||||
Fly Acquisition III Facility
|
159,586
|
190,457
|
4.53
|
%
|
4.10
|
%
|
February 2022
|
|||||||||||||
Fly Aladdin Acquisition Facility
|
352,777
|
467,179
|
4.75
|
%
|
4.59
|
%
|
June 2023
|
|||||||||||||
Fly Aladdin Engine Funding Facility
|
43,093
|
43,829
|
4.95
|
%
|
4.95
|
%
|
December 2021 – April 2022
|
|||||||||||||
Other Aircraft Secured Borrowings
|
746,189
|
807,882
|
4.44
|
%
|
4.44
|
%
|
December 2020 – June 2028
|
|||||||||||||
Total outstanding principal balance
|
2,091,351
|
2,416,807
|
|
|||||||||||||||||
Unamortized debt discounts and loan costs
|
(29,304
|
)
|
(36,938
|
)
|
|
|||||||||||||||
Total secured borrowings, net
|
$
|
2,062,047
|
$
|
2,379,869
|
|
(1) |
Represents the contractual interest rates and effect of derivative instruments and excludes the amortization of debt discounts and debt issuance costs.
|
(2) |
As of June 30, 2019 and December 31, 2018, accrued interest on secured borrowings totaled $9.4 million and $10.9 million, respectively.
|
Type
|
Quantity
|
Maturity Date
|
Hedge
Interest
Rate
|
Swap
Contract
Notional
Amount
|
Credit Risk
Adjusted
Fair Value
|
Gain Recognized in
Accumulated
Comprehensive
Loss
|
|||||||||||||||
Interest rate swap contracts
|
2
|
2/15/2022
|
0.99%-1.07
|
%
|
$
|
49,482
|
$
|
690
|
$
|
604
|
|||||||||||
Accrued interest
|
—
|
26
|
—
|
||||||||||||||||||
Sub-total
|
2
|
$
|
49,482
|
$
|
716
|
$
|
604
|
Type
|
Quantity
|
Maturity Date
|
Contracted
Fixed
Conversion
Rate to U.S.
Dollar
|
Total
Contracted
USD to be
Received
|
Credit Risk
Adjusted
Fair Value
|
Gain Recognized in
Accumulated
Comprehensive
Loss
|
|||||||||||||||
Cross currency swap contract
|
1
|
11/26/25
|
1 EURO to $1.3068 |
$
|
63,543
|
$
|
3,806
|
$
|
3,331
|
||||||||||||
Accrued rent
|
—
|
18
|
—
|
||||||||||||||||||
Sub-total
|
1
|
63,543
|
3,824
|
3,331
|
|||||||||||||||||
Total - designated derivative assets
|
3
|
$
|
4,540
|
$
|
3,935
|
Type
|
Quantity
|
Maturity Date
|
Hedge
Interest
Rate
|
Swap
Contract
Notional
Amount
|
Credit Risk
Adjusted Fair
Value
|
Loss Recognized
in Accumulated
Comprehensive
Loss
|
|||||||||||||||
Interest rate swap contracts
|
39
|
11/9/21-12/8/25
|
1.93%-3.13
|
%
|
$
|
934,735
|
$
|
(30,939
|
)
|
$
|
(26,330
|
)
|
|||||||||
Accrued interest
|
—
|
(297
|
)
|
—
|
|||||||||||||||||
Total – designated derivative liabilities
|
39
|
$
|
934,735
|
$
|
(31,236
|
)
|
$
|
(26,330
|
)
|
Type
|
Quantity
|
Maturity Date
|
Hedge
Interest
Rate
|
Swap
Contract
Notional
Amount
|
Credit Risk
Adjusted Fair
Value
|
Loss Recognized
in Accumulated
Comprehensive
Loss
|
|||||||||||||||
Interest rate swap contracts
|
7
|
1/11/23-6/15/23
|
2.44%-4.30
|
%
|
$
|
31,174
|
$
|
(386
|
)
|
$
|
(98
|
)
|
|||||||||
Accrued interest
|
—
|
1
|
—
|
||||||||||||||||||
Total – dedesignated derivative liabilities
|
7
|
$
|
31,174
|
$
|
(385
|
)
|
$
|
(98
|
)
|
|
|
Three months ended June 30,
|
|
|
Six months ended June 30,
|
|
||||||||||
2019
|
2018
|
2019
|
2018
|
|||||||||||||
Numerator
|
||||||||||||||||
Net income attributable to common shareholders
|
$
|
54,050
|
$
|
24,344
|
$
|
99,015
|
$
|
33,974
|
||||||||
Denominator
|
||||||||||||||||
Weighted average shares outstanding-Basic
|
32,053,830
|
27,983,352
|
32,341,674
|
27,983,352
|
||||||||||||
Dilutive common equivalent shares:
|
||||||||||||||||
SARs
|
133,285
|
62,538
|
55,043
|
40,067
|
||||||||||||
Weighted average shares outstanding-Diluted
|
32,187,115
|
28,045,890
|
32,396,717
|
28,023,419
|
||||||||||||
Earnings per share:
|
||||||||||||||||
Basic
|
||||||||||||||||
Distributed earnings
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
||||||||
Undistributed income
|
$
|
1.69
|
$
|
0.87
|
$
|
3.06
|
$
|
1.21
|
||||||||
Basic earnings per share
|
$
|
1.69
|
$
|
0.87
|
$
|
3.06
|
$
|
1.21
|
||||||||
Diluted
|
||||||||||||||||
Distributed earnings
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
||||||||
Undistributed income
|
$
|
1.68
|
$
|
0.87
|
$
|
3.06
|
$
|
1.21
|
||||||||
Diluted earnings per share
|
$
|
1.68
|
$
|
0.87
|
$
|
3.06
|
$
|
1.21
|
As of June 30, 2019
|
As of December 31, 2018
|
|||||||||||||||
Principal
Amount
Outstanding
|
Fair Value
|
Principal
Amount
Outstanding
|
Fair Value
|
|||||||||||||
Securitization Notes
|
$
|
—
|
$
|
—
|
$
|
85,584
|
$
|
80,770
|
||||||||
Term Loan
|
396,566
|
395,099
|
407,768
|
396,554
|
||||||||||||
2021 Notes
|
325,000
|
333,125
|
325,000
|
329,875
|
||||||||||||
2024 Notes
|
300,000
|
307,890
|
300,000
|
279,390
|
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
June 30, 2019:
|
||||||||||||||||
Derivative assets
|
—
|
$
|
4,540
|
—
|
$
|
4,540
|
||||||||||
Derivative liabilities
|
—
|
31,621
|
—
|
31,621
|
||||||||||||
Investment in equity certificates
|
—
|
5,711
|
—
|
5,711
|
||||||||||||
December 31, 2018:
|
||||||||||||||||
Derivative assets
|
—
|
$
|
5,929
|
—
|
$
|
5,929
|
||||||||||
Derivative liabilities
|
—
|
8,558
|
—
|
8,558
|
||||||||||||
Investment in equity certificates
|
—
|
5,747
|
—
|
5,747
|
|
|
Three months ended
|
|
|||||
June 30, 2019
|
June 30, 2018
|
|||||||
(Dollars in thousands)
|
||||||||
Revenues
|
||||||||
Operating lease revenue
|
$
|
128,623
|
$
|
99,324
|
||||
Finance lease revenue
|
156
|
171
|
||||||
Equity earnings (loss) from unconsolidated subsidiary
|
54
|
(358
|
)
|
|||||
Gain on sale of aircraft
|
16,078
|
2,945
|
||||||
Interest and other income
|
2,122
|
591
|
||||||
Total revenues
|
147,033
|
102,673
|
||||||
Expenses
|
||||||||
Depreciation
|
37,303
|
33,895
|
||||||
Interest expense
|
35,439
|
33,644
|
||||||
Selling, general and administrative
|
9,438
|
6,369
|
||||||
Loss (gain) on derivatives
|
255
|
(1,309
|
)
|
|||||
Loss on extinguishment of debt
|
1,541
|
898
|
||||||
Maintenance and other costs
|
1,625
|
936
|
||||||
Total expenses
|
85,601
|
74,433
|
||||||
Net income before provision for income taxes
|
61,432
|
28,240
|
||||||
Provision for income taxes
|
7,382
|
3,896
|
||||||
Net income
|
$
|
54,050
|
$
|
24,344
|
|
Three months ended
|
Increase/
(Decrease)
|
||||||||||
June 30, 2019
|
June 30, 2018
|
|||||||||||
(Dollars in thousands)
|
||||||||||||
Operating lease revenue:
|
||||||||||||
Operating lease rental revenue
|
$
|
101,108
|
$
|
89,215
|
$
|
11,893
|
||||||
End of lease income
|
28,823
|
12,612
|
16,211
|
|||||||||
Amortization of lease incentives
|
(1,319
|
)
|
(2,361
|
)
|
1,042
|
|||||||
Amortization of lease discounts and other
|
11
|
(142
|
)
|
153
|
||||||||
Total operating lease revenue
|
$
|
128,623
|
$
|
99,324
|
$
|
29,299
|
|
|
Six months ended
|
|
|||||
June 30, 2019
|
June 30, 2018
|
|||||||
(Dollars in thousands)
|
||||||||
Revenues
|
||||||||
Operating lease revenue
|
$
|
233,875
|
$
|
186,400
|
||||
Finance lease revenue
|
316
|
345
|
||||||
Equity earnings (loss) from unconsolidated subsidiary
|
110
|
(246
|
)
|
|||||
Gain on sale of aircraft
|
43,698
|
2,945
|
||||||
Interest and other income
|
3,737
|
1,984
|
||||||
Total revenues
|
281,736
|
191,428
|
||||||
Expenses
|
||||||||
Depreciation
|
74,888
|
67,628
|
||||||
Interest expense
|
73,618
|
66,567
|
||||||
Selling, general and administrative
|
18,160
|
14,979
|
||||||
Loss (gain) on derivatives
|
272
|
(520
|
)
|
|||||
Loss on extinguishment of debt
|
3,710
|
898
|
||||||
Maintenance and other costs
|
2,223
|
1,714
|
||||||
Total expenses
|
172,871
|
151,266
|
||||||
Net income before provision for income taxes
|
108,865
|
40,162
|
||||||
Provision for income taxes
|
9,850
|
6,188
|
||||||
Net income
|
$
|
99,015
|
$
|
33,974
|
|
Six months ended
|
Increase/
(Decrease)
|
||||||||||
June 30, 2019
|
June 30, 2018
|
|||||||||||
(Dollars in thousands)
|
||||||||||||
Operating lease revenue:
|
||||||||||||
Operating lease rental revenue
|
$
|
206,436
|
$
|
178,328
|
$
|
28,108
|
||||||
End of lease income
|
30,387
|
12,997
|
17,390
|
|||||||||
Amortization of lease incentives
|
(2,951
|
)
|
(4,644
|
)
|
1,693
|
|||||||
Amortization of lease discounts and other
|
3
|
(281
|
)
|
284
|
||||||||
Total operating lease revenue
|
$
|
233,875
|
$
|
186,400
|
$
|
47,475
|
Period
|
Total Number
of Shares
Purchased
|
Average Price
Paid Per Share
|
Total Number of Shares
Purchased as Part of a
Publicly Announced
Repurchase Plan
|
Approximate Dollar
Value of Shares that
may yet be Purchased
Under the Plans or
Programs (1)(2)
|
||||||||||
April 1-30, 2019
|
29,597
|
$
|
13.97
|
29,597
|
$
|
46.9 million
|
||||||||
May 1-31, 2019
|
502,954
|
$
|
16.27
|
502,954
|
$
|
38.7 million
|
||||||||
June 1-30, 2019
|
937,802
|
$
|
16.75
|
937,802
|
$
|
23.0 million
|
(1) |
In November 2018, our board of directors approved a $50.0 million share repurchase program expiring in December 2019.
|
(2)
|
On August 21, 2019, our board of directors approved a new $50 million share repurchase program to replace its current program. Under this program, we may make share repurchases from time to time in the
open market or in privately negotiated transactions.
|
Purchase Agreement dated July 2, 2019 among the sellers identified therein, Horizon Aircraft Finance II Limited, Horizon Aircraft Finance II LLC and the other purchasers identified therein.
|
EXHIBIT A SELLERS AND ASSETS
|
SCHEDULE 1 REPRESENTATIONS AND WARRANTIES OF SELLERS
|
SCHEDULE 2 THE ISSUER GROUP REPRESENTATIONS AND WARRANTIES
|
SCHEDULE 3 PARTICULARS OF THE AIRCRAFT
|
SCHEDULE 4 FORM OF BILL OF SALE
|
SCHEDULE 5 RENT TRANSFER AMOUNTS
|
SCHEDULE 6 THE TRANSFERRING COMPANIES
|
SCHEDULE 7 THE TRANSFERRING TRUSTS
|
SCHEDULE 8 THE TRANSFERRING SUBSIDIARIES
|
SCHEDULE 9 UNOWNED AIRCRAFT
|
SCHEDULE 10 FORM OF SHARE TRANSFER
|
SCHEDULE 11 FORM OF ASSIGNMENT OF BENEFICIAL INTEREST
|
ANNEX 1 DISCLOSURE LETTER
|
(1) |
THE SELLERS LISTED ON EXHIBIT A HERETO;
|
(2) |
HORIZON AIRCRAFT FINANCE II LIMITED, an exempted company incorporated with limited liability under the laws of the Cayman Islands (the Cayman Issuer);
and
|
(3) |
HORIZON AIRCRAFT FINANCE II LLC, a Delaware limited liability company (the US Issuer and, together with the Cayman Issuer, the Issuers).
|
A. |
The Issuer Group has agreed to acquire from the Sellers, as applicable, the Aircraft Interests or the Aircraft (as hereinafter defined) on the terms and conditions set out in this Agreement, including the provisions contained in
Clause 4.
|
B. |
Amounts payable by the Issuer Group for the acquisition by way of sale and purchase from the Sellers of the Aircraft Interests and the Aircraft will be financed, directly or indirectly, in whole or in part, through the issue of
financial instruments (including the Initial Notes and the E Note).
|
1.1 |
Definitions:
|
|
(i) |
an amount (which may be positive or negative) equal to (A) the aggregate amount of all Lease Expenses in respect of such Remaining Aircraft paid by the Issuers pursuant to Clause 5.1 (or, in the case of a Substitute Aircraft, all
such Lease Expenses paid by the Issuers in respect of the relevant replaced Remaining Aircraft through the date of substitution and all Lease Expenses paid in respect of the Substitute Aircraft thereafter) less (B) the aggregate of all
amounts corresponding to Rental Payments and Maintenance Rent transferred to the Collections Account with respect to such Remaining Aircraft pursuant to Section 3.08(f) of the Indenture; plus
|
|
(ii) |
an amount equal to (A) the portion of the Outstanding Principal Balance of the Initial Notes to be redeemed in an Acquisition Balance Redemption on the applicable Redemption Date in respect of such Remaining Aircraft in accordance
with Section 3.10(b) of the Indenture less (B) the balance on deposit in the sub-account in the Aircraft Acquisition Account in respect of such Remaining Aircraft on such Redemption Date; plus
|
|
(iii) |
an amount equal to (A) interest at the rate of 4.13% per annum for the period from the Initial Closing Date to such Redemption Date on the Allocable Repayment Amount in respect of such Remaining Aircraft calculated as of the
applicable Redemption Date less (B) the sum of (1) any Interest Amount previously paid by or on behalf of the Issuers with respect to the Initial Notes to be redeemed in the Acquisition Balance Redemption on or prior to such Redemption
Date and (2) the amount of all Investment Earnings on the amounts on deposit in the sub-account in the Aircraft Acquisition Account relating to such Remaining Aircraft on such Redemption Date; plus
|
|
(iv) |
an amount equal to interest at the rate of 12.00% per annum for the period from the Initial Closing Date to such Redemption Date on the Allocable E Note Amount for such Remaining Aircraft less any amounts distributed to the E Note
Account pursuant to Section 3.09 of the Indenture during such period that is allocable to such Remaining Aircraft (such allocation to be based on the Designated Percentage of such Remaining Aircraft);
|
(a)
|
any Issuer Encumbrance;
|
|
(b) |
any “Permitted Lien” (or other similar term) as defined under the relevant Lease (other than liens created by the relevant Lessor);
|
|
(c) |
any liens created by or through or arising from debt or liabilities or any act or omission of any Lessee, in each case in contravention of the relevant Lease (whether or not such Lease has been terminated) or without the consent of
the relevant Lessor;
|
|
(d) |
any head lease, lease, conditional sale agreement or option permitted under the Leases or purchase options relating to the Aircraft which would constitute a “Permitted Lien” as defined in the Indenture; and
|
|
(e) |
any lien for Taxes, assessments or government charges which are not yet due or payable or which are being contested in good faith and for which an adequate reserve has been established in accordance with U.S. GAAP;
|
(a)
|
owns, leases or is to acquire or lease any of the Aircraft; or
|
|
(b) |
owns or is to acquire any Transferring Subsidiary which owns, leases or is to acquire or lease any of the Aircraft,
|
|
(a) |
is not unable to pay its debts as such debts fall due nor would it be deemed to be unable to pay its debts as such debts fall due within the meaning of the Relevant Solvency Acts; and
|
|
(b) |
would not become unable to pay its debts as such debts fall due nor would be deemed to be unable to pay its debts as such debts fall due within the meaning of the Relevant Solvency Acts; and the word solvency
shall be construed accordingly;
|
1.2 |
Computation of Time Periods:
|
1.3 |
Statutes:
|
1.4 |
Number, Persons:
|
1.5 |
Indenture Definitions:
|
1.6 |
Internal References:
|
|
(1) |
Words such as hereunder, hereto, hereof and herein and other words commencing with here shall unless the context clearly indicates the contrary refer to the whole of this Agreement and not to any particular Clause, sub Clause, paragraph or sub paragraph hereof.
|
|
(2) |
References to this Agreement include the schedules, annexes and exhibits hereto and the Disclosure Letter and any amendments made in accordance with Clause 15.5.
|
|
(3) |
Any reference to any Clause, sub Clause, paragraph or sub paragraph shall be a reference to the Clause, sub Clause, paragraph or sub paragraph of this Agreement in which the reference occurs unless it is indicated that reference to
some other provision is intended.
|
|
(4) |
All references to Schedules, Exhibits and Annexes refer to Schedules, Exhibits and Annexes to this Agreement.
|
1.7 |
Headings:
|
2.1 |
Purchase and Sale:
|
|
2.1.1 |
title to the Transferring Title Aircraft;
|
|
2.1.2 |
the Shares in the Transferring Companies; and/or
|
|
2.1.3 |
the Beneficial Interests in the Transferring Trusts.
|
2.2 |
Purchase Price and Other Payments
|
|
(1) |
The consideration for the Shares in each Transferring Company to be transferred on the applicable Closing Date shall be calculated based on the aggregate Base Purchase Price of the Aircraft owned by such Transferring Company or, if
applicable, a Transferring Subsidiary of such Transferring Company (including for the avoidance of doubt, any Aircraft the Beneficial Interest in which is held by such Transferring Company or a Transferring Subsidiary of such
Transferring Company), on such Closing Date less:
|
|
(a) |
the amount equivalent to Rental Payments (if any) paid prior to such Closing Date pursuant to the Lease of the Aircraft owned by such Transferring Company (or where applicable, a Transferring Subsidiary of such Transferring Company)
which relates to the period on and after the Initial Closing Date;
|
|
(b) |
the amount equivalent to Maintenance Rent (if any) paid prior to such Closing Date pursuant to the Lease of the Aircraft owned by such Transferring Company (or where applicable, a Transferring Subsidiary of such Transferring Company)
which relates to the period on and after the Initial Closing Date; and
|
|
(c) |
any deduction required under Clause 6.2 in respect of the relevant Aircraft;
|
|
(2) |
The obligation of the Issuers or the applicable Issuer Group Member to pay the Purchase Price shall be satisfied and discharged by the payment to or at the direction of the applicable Seller of the Purchase Price for such
Transferring Company in accordance with Clause 4.2.
|
|
(1) |
The consideration for the Beneficial Interests to be transferred on the applicable Closing Date shall be calculated based on the aggregate Base Purchase Price of the Aircraft owned by the relevant Transferring Trust (or any
Transferring Subsidiary of that Transferring Trust) on such Closing Date less:
|
|
(a) |
the amount equivalent to Rental Payments (if any) paid prior to such Closing Date pursuant to the Lease of the Aircraft owned by such Transferring Trust (or any Transferring Subsidiary of that Transferring Trust) which relates to the
period on and after the Initial Closing Date;
|
|
(b) |
the amount equivalent to Maintenance Rent (if any) paid prior to such Closing Date pursuant to the Lease of the Aircraft owned by such Transferring Trust (or any Transferring Subsidiary of that Transferring Trust) which relates to
the period on and after the Initial Closing Date;
|
|
(c) |
any deduction required under Clause 6.2 in respect of the relevant Aircraft;
|
|
(2) |
The obligation of the applicable Issuer or the applicable Issuer Group Member to pay the Purchase Price for a Transferring Trust on the Closing Date shall be satisfied and discharged by the payment to or at the direction of the
applicable Seller of the Purchase Price for such Transferring Trust, in each case in accordance with Clause 4.2.
|
|
(1) |
The consideration for the Transferring Title Aircraft to be transferred on the applicable Closing Date shall be calculated based on the aggregate Base Purchase Price of the Transferring Title Aircraft on such Closing Date less:
|
|
(a) |
the amount equivalent to Rental Payments (if any) paid prior to such Closing Date pursuant to the Lease of the Transferring Title Aircraft which relates to the period on and after the Initial Closing Date;
|
|
(b) |
the amount equivalent to Maintenance Rent (if any) paid prior to such Closing Date pursuant to the Lease of the Transferring Title Aircraft which relates to the period on and after the Initial Closing Date;
|
|
(c) |
any deduction required under Clause 6.2 in respect of the relevant Transferring Title Aircraft;
|
|
(2) |
The obligation of the applicable Issuer or the applicable Issuer Group Member to pay the Purchase Price for a Transferring Title Aircraft on the Closing Date shall be satisfied and discharged by the payment to or at the direction of
the applicable Seller of the Purchase Price for such Transferring Title Aircraft, in each case in accordance with Clause 4.2.
|
|
(3) |
The applicable Issuer shall have received a written confirmation of the applicable Servicer, with respect to the insurances maintained in respect of the Transferring Title Aircraft.
|
|
2.2.4 |
Schedule 5 sets forth the amount of Rental Payments and Maintenance Rent (if any) received by (or deemed received by) a Seller on or prior to the Initial Closing Date in respect of each Aircraft (set out on an Aircraft-by-Aircraft
basis), in each case, which relates to any period on and after the Initial Closing Date. On the Initial Closing Date, pursuant to the Funds Flow, the Managing Agent shall transfer from the Aircraft Acquisition Account to the applicable
Collections Account (or retain in the applicable Collections Account in accordance with the Funds Flow) an amount equal to the aggregate amounts set forth on such Schedule 5. Within five Business Days after each Determination Date on or
prior to the end of the Delivery Period, each Seller shall (or shall cause the Servicer to) deliver a certificate (which may be included in the monthly report delivered to the Issuers pursuant to Section 9.01 of Schedule 2.02(a) of the
Servicing Agreement (the Monthly Services Report) in lieu of a separate certificate) to the applicable Issuer and the Managing Agent with respect to each Aircraft for which a Closing Date (or
Non-Delivery Date) has, at the time of such Determination Date, not yet occurred, certifying (on an Aircraft-by-Aircraft basis) the amount of Rental Payments and Maintenance Rent (if any) received by (or deemed received by) a Seller on
or prior to such Determination Date pursuant to the Lease of each such Aircraft (other than any amount that was previously set forth on Schedule 5 or in a certificate (or Monthly Services Report) previously delivered pursuant to this
Clause 2.2.4). After receipt of each such certificate, the Managing Agent shall, pursuant to Section 3.08(f) of the Indenture, transfer from the relevant sub-accounts in the Aircraft Acquisition Account for such Aircraft to the
applicable Collections Account (or in the case of any such amount constituting Segregated Funds, the Lessee-Funded Account) an amount equal to the amount set forth therein.
|
|
(1) |
If at any time following the transfer of an Aircraft or Aircraft Interest to an Issuer or the applicable Issuer Group Member, a Seller receives any Rent Payment or any Maintenance Rent in respect of such Aircraft or the Aircraft
Interests to which such Aircraft relates, it shall, to the extent that such payments relate to any period commencing on or after the Initial Closing Date, promptly pay such amounts to the Issuer Group.
|
|
(2) |
If at any time following the transfer of an Aircraft or Aircraft Interest to an Issuer or the applicable Issuer Group Member, an Issuer Group Member receives any Rent Payment, any Maintenance Rent or any other amount in respect of
such Aircraft or the Aircraft Interests to which such Aircraft relates (including, without limitation, any such amount which an Issuer or the applicable Issuer Group Member may have received as a result of (i) any cash or equity held by
Transferring Company or Transferring Trust as of the relevant Closing Date being transferred with such Transferring Company or Transferring Trust on such Closing Date and/or (ii) certain funds and/or bank accounts held by a Transferring
Company or Transferring Trust as of the relevant Closing Date remaining with such Transferring Company or Transferring Trust following the relevant Closing), it shall, to the extent that such amounts relate to any period prior to the
Initial Closing Date, promptly pay such amounts to the applicable Seller.
|
2.3 |
No Liens
|
|
2.3.1 |
The Shares in each Transferring Company shall be sold free from all Liens (other than Permitted Liens) and with the benefit of all rights attached or accruing thereto.
|
|
2.3.2 |
The Beneficial Interests in each Transferring Trust shall be sold free from all Liens (other than Permitted Liens) and with the benefit of all rights attached or accruing thereto.
|
|
2.3.3 |
Each Transferring Title Aircraft shall be sold free from all Liens (other than Permitted Liens) and with the benefit of all rights attached or accruing thereto.
|
3.1 |
Closing of the sale and purchase of the Shares in each Remaining Company shall take place on each Closing Date on or by which the conditions specified in this Clause 3.1 and in Clause 14 are or have been satisfied (or waived) in
relation to that Remaining Company. On the Initial Closing Date, the Initial Aircraft and Initial Aircraft Interests shall be tendered by the applicable Seller to an Issuer for delivery hereunder by the sale of the relevant Aircraft and
Aircraft Interests. Closing of the sale and purchase of the Shares in each Transferring Company to be delivered on the Initial Closing Date shall be subject to the conditions in Clause 14 and to the following conditions in relation to
that Transferring Company:
|
|
3.1.1 |
such Seller shall deliver to the applicable Issuer Group Member the following insofar as they relate either to the sale and purchase of the Shares in that Transferring Company:
|
|
(a) |
a duly executed transfer instrument (in substantially the form appended at Schedule 10 or such other form as may be agreed between such Seller and the applicable Issuer Group Member) in favor of such Issuer or the applicable Issuer
Group Member in respect of all the Shares in that Transferring Company together with all existing share certificates issued in respect of such Transferring Company, or in the case of any lost share certificate an indemnity in lieu
thereof in terms reasonably satisfactory to such Issuer;
|
|
(b) |
a duly certified copy of the Register of Members of such Transferring Company, showing such Issuer or the applicable Issuer Group Member as the sole holder of the Shares of such Transferring Company;
|
|
(c) |
a duly certified copy of the Register of Members of any relevant Transferring Subsidiary Company, showing the relevant Transferring Company as the sole holder of the Shares of such Transferring Subsidiary Company; and
|
|
(d) |
a copy of the trust agreement in respect of any relevant Transferring Subsidiary Trust, showing that the relevant Transferring Company is the sole beneficiary of such Transferring Subsidiary Trust;
|
|
(2) |
written notification by such Seller to the Issuers (with a copy to the Managing Agent) in respect of the Aircraft, if any, owned or leased by the relevant Transferring Company (or, where relevant, any Transferring Subsidiary of such
Transferring Company), which shall be delivered no less than one Business Day prior to the relevant Closing Date (the Delivery Notice) and shall contain the information described in Warranty 8.1
in Part 1 of Schedule 1 hereto with respect to such Aircraft;
|
|
(3) |
a copy of any power of attorney under which any document required to be delivered to the applicable Issuer Group Member under this Clause has been executed and such other documents including any waivers or consents as the applicable
Issuer Group Member may require to enable such Issuer Group Member to be registered as holders of the Shares of the relevant Transferring Company;
|
|
(4) |
the copies of the certificate of incorporation or formation or registration and certificates of incorporation or formation or registration on change of name and the seals, statutory books (duly written up to date), books of account,
and all other constitutional documents, books, documents or records and papers of the relevant Transferring Company or evidence satisfactory to the applicable Issuer Group Member that they are held by or to the order of the relevant
Transferring Company;
|
|
(5) |
the written resignations of the directors and the other officers (if any) from their respective offices in the Transferring Company, with written acknowledgments from each of them in a form reasonably acceptable to the applicable
Issuer Group Member;
|
|
(6) |
resolutions of the members of the Transferring Company to change the Constitution (or equivalent constitutional and organizational documents) of such Transferring Company, each of the said Constitution (or equivalent constitutional
and organizational documents) to conform with those as agreed with the applicable Issuer;
|
|
(7) |
insofar as not already provided to the applicable Issuer Group Member, a copy of each Lease (and, where applicable, head lease and intermediate lease) to which the relevant Transferring Company (and, where relevant, any Transferring
Subsidiary of such Transferring Company) is party (or to which such Transferring Company or Transferring Subsidiary, as the case may be, will become party on such Closing) which, in each case, shall be in compliance with the
requirements of the Indenture; and
|
|
(8) |
insofar as not already provided to the applicable Issuer Group Member, a copy of delivery acknowledgments or Bills of Sale in the possession of the relevant Seller evidencing the title of the relevant Aircraft.
|
3.2 |
Closing of the sale and purchase of the Beneficial Interest in each Remaining Trust shall take place on each Closing Date on or by which the conditions specified in this Clause 3.2 and in Clause 14 are or have been satisfied in
relation to that Remaining Trust. Closing of the sale and purchase of each Transferring Trust to be delivered on the Initial Closing Date shall be subject to the conditions in Clause 14 and to the following conditions in relation to
that Transferring Trust:
|
|
3.2.1 |
the applicable Seller shall deliver to the applicable Issuer Group Member the following insofar as they relate either to the sale and purchase of the Beneficial Interest in that Transferring Trust:
|
|
(1) |
with respect to each Transferring Trust, a Trust Assignment Agreement (in the form appended at Schedule 11 in respect of the Irish Transferring Trusts) in respect of the relevant Beneficial Interest, duly executed by the relevant
Trustor, the relevant Issuer Group Member and, if applicable, the owner trustee of such Transferring Trust;
|
|
(2) |
a copy of the relevant Trust Agreement;
|
|
(3) |
a duly certified copy of the Register of Members of any relevant Transferring Subsidiary Company, showing the relevant Transferring Trust as the sole holder of the Shares of such Transferring Subsidiary Company;
|
|
(4) |
a copy of the trust agreement in respect of any relevant Transferring Subsidiary Trust, showing that the relevant Transferring Trust is the sole beneficiary of such Transferring Subsidiary Trust;
|
|
(5) |
with respect to each Transferring Trust, a Delivery Notice by such Seller to the Issuers (with a copy to the Managing Agent) in respect of the Aircraft owned by the Transferring Trust (or any Transferring Subsidiary of that
Transferring Trust) to be transferred which shall be delivered no less than one Business Day prior to the relevant Closing Date and shall contain the information described in Warranty 8.1 in Part 1 of Schedule 1 hereto with respect to
such Transferring Trust, any relevant Transferring Subsidiary and the relevant Aircraft;
|
|
(6) |
a certificate of a duly authorized officer of the owner trustee of the Transferring Trust attaching copies of the constitutive documents of such owner trustee and certifying the signatures of each of the directors or other officers
of such owner trustee authorized to sign the Other Transaction Documents to which it is a party;
|
|
(7) |
insofar as not already provided to the applicable Issuer or applicable Issuer Group Member, a copy of each Lease (and, where applicable, head lease and intermediate lease) to which the relevant Transferring Trust (and any
Transferring Subsidiary of that Transferring Trust) is party (or to which such Transferring Trust (or any Transferring Subsidiary of that Transferring Trust) will become party on such Closing) which, in each case, shall be in compliance
with the requirements of the Indenture; and
|
|
(8) |
insofar as not already provided to the applicable Issuer Group Member, a copy of delivery acknowledgments or Bills of Sale in the possession of the relevant Seller evidencing the title of the relevant Aircraft.
|
3.3 |
Closing of the sale and purchase of a Transferring Title Aircraft shall take place on each Closing Date on or by which the conditions specified in this Clause 3.3 and in Clause 14 are or have been satisfied. Closing of the sale and
purchase of the Transferring Title Aircraft to be delivered on the Initial Closing Date shall be subject to the conditions in Clause 14 and to the following conditions:
|
|
3.3.1 |
the applicable Seller shall deliver to the applicable Issuer Group Member the following insofar as they relate to the sale and purchase of the relevant Transferring Title Aircraft:
|
|
(1) |
a copy of the relevant Bill of Sale transferring title to the relevant Transferring Title Aircraft from the relevant Aircraft Owner to the relevant Issuer Group Member duly executed by the relevant Aircraft Owner in a form reasonably
satisfactory to the applicable Issuer Group Member, and, insofar as not already provided to the applicable Issuer Group Member, copies of bills of sale in the possession of the relevant Seller for such Transferring Title Aircraft
(including each applicable Engine) showing the chain of title from the relevant manufacturer;
|
|
(2) |
copies of the assignments of warranty in relation to the relevant airframe and engines referred to in Clause 13.2 duly consented to by the relevant manufacturer, but only to the extent unexpired assignable warranties from the
airframe and engine manufacturers having material value exist with respect to the applicable Transferring Title Aircraft (provided that any such consents may be obtained within 90 days after such
Closing Date);
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|
(3) |
the conditions precedent to the effectiveness of the Novation Agreement, as applicable, for the applicable Transferring Title Aircraft which are expressed to be for the benefit of the relevant Issuer Group Member shall have been
satisfied in all material respects (or waived by the relevant Issuer Group Member);
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|
(4) |
a copy of a Delivery Notice by such Seller to the Issuers (with a copy to the Managing Agent) in respect of the relevant Transferring Title Aircraft to be transferred, which shall be delivered no less than one Business Day prior to
the relevant Closing Date and shall contain the information described in Warranty 8.1 in Part 1 of Schedule 1 hereto with respect to such Transferring Title Aircraft; and
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|
(5) |
insofar as not already provided to the applicable Issuer Group Member, a copy of each Lease (and, where applicable, head lease and/or sublease) relating to such Transferring Title Aircraft, together with all amendments thereto,
which, in each case, shall be in compliance with the requirements of the Indenture.
|
4.1 |
The applicable Seller acknowledges and agrees with the Issuers that the applicable Issuer Group Member has relied on such Seller’s representations and agreements set forth in Clause 8 that it will use its reasonable commercial
efforts to meet all conditions precedent to the transfer of the Remaining Aircraft or the Transferring Companies and Transferring Trusts with respect to such Remaining Aircraft to the applicable Issuer Group Member prior to two hundred
and seventy (270) days after the Initial Closing Date (or, for no more than five (5) of the Remaining Aircraft, three hundred and sixty five (365) days after the Initial Closing Date) (the Delivery
Expiry Date), and that the Issuers have obtained financing for the purpose of purchasing all of the Remaining Aircraft or the Remaining Entities with the Remaining Aircraft.
|
4.2 |
Following the Initial Closing Date, at any time and from time to time, until the full amount of the Purchase Price in respect of all Aircraft has been paid, subject to receipt by the Issuers (with a copy to the Managing Agent) of a
Delivery Notice specifying a date and time for payment (which shall be a Business Day and a time during normal banking hours in New York City) from or on behalf of the applicable Sellers at least one (1) Business Day prior to the
proposed date of payment and the satisfaction of the other relevant conditions precedent to Closing set out in this Agreement, the Issuers shall, on such proposed payment date, for the account of the relevant Issuer Group Member, pay to
the applicable Seller thereof the Purchase Price for each Aircraft and/or Aircraft Interest listed in the applicable notice as being sold by such Seller.
|
4.3 |
With respect to each Remaining Aircraft, upon the occurrence of the Non-Delivery Date with respect to such Remaining Aircraft, the relevant Seller shall pay to the Issuers, for the account of the relevant Issuer Group Member, the
Aircraft Non-Delivery Amount (if a positive number) for such Remaining Aircraft on such date.
|
4.4 |
Except as otherwise provided in this Agreement, neither the applicable Seller nor the Issuers nor the applicable Issuer Group Member shall have any obligation to make any payments with respect to an Aircraft to the extent such
payments relate to any period following the earlier of the Closing Date of the sale of the Aircraft or the Aircraft Interest relating to such Aircraft and the Non-Delivery Date for such Aircraft or Aircraft Interest.
|
5.1 |
Notwithstanding that the Issuers do not own the Remaining Aircraft, the Issuers (acting jointly and severally) shall pay all Lease Expenses incurred and relating to events that occurred after the Initial Closing Date with respect to
each Remaining Aircraft as notified by the Sellers. All Lease Expenses described in this Section shall be paid as “Expenses” or “Maintenance and Modification Expenses” or directly from the Maintenance Reserve Account to the extent
permitted under Section 3.04(b) of the Indenture (as applicable) in respect of the relevant Remaining Aircraft in accordance with the terms of the Indenture.
|
5.2 |
Each Seller agrees to transfer each Remaining Aircraft, Remaining Trust and Remaining Company and to notify the Issuers immediately if such Seller reasonably believes that it will have to deliver a Termination Notice with respect to
any Remaining Aircraft, Remaining Trust or Remaining Company or proposed delivery of a Substitute Aircraft.
|
5.3 |
No Seller will be responsible for legal fees and expenses of the E Note Holder (or any Equity Certificate Investor) incurred in connection with the transactions contemplated by this Agreement; provided
that, the applicable Seller shall pay for all costs and expenses of the parties as specified below herein incurred in connection with the acquisition of the Aircraft and the Aircraft Interests pursuant hereto: (i) all costs and
expenses of such Seller, the Issuers and any relevant Issuer Group Member for the purpose of purchasing such Aircraft or Aircraft Interest, exclusive of any amounts payable in respect of the shares, equity or other capital of such
Issuer Group Member, (ii) reasonable legal fees of such Seller, such Issuer Group Member, the Security Trustee and the Initial Purchasers incurred in connection with the drafting, negotiating and delivering, as applicable, any relevant
Trust Assignment, Novation Agreement, Notice and Acknowledgement and other conditions precedent to the occurrence of the relevant Closing hereunder, and any other related documentation and advice and for the legal fees and other costs
and expenses of the relevant Lessee that are payable or reimbursable to the relevant Lessee under the applicable Lease in connection therewith, (iii) its own legal fees (including those of its local counsel) and the costs of any
required filings or registrations incurred in connection with the applicable transfer of an Aircraft or Aircraft Interest, (iv) its own legal fees (including those of their local counsel) and the costs and expenses of all filings and
registrations (including with respect to the relevant Aircraft or Lease ownership and security interests under the Uniform Commercial Code or under the Cape Town Convention) and any other security interest relating to the relevant
Aircraft or Aircraft Interest or related Lease and other collateral granted under the Security Trust Agreement in connection with the relevant Closing, and any costs and expenses incurred in connection with obtaining each legal opinion
required to be delivered in connection with the relevant Closing and (v) the fees of each Appraiser charged in connection with obtaining each appraisal required to be delivered hereunder in respect of the relevant Aircraft.
|
6. |
SUBSTITUTION AND TERMINATION
|
6.1 |
Substitution:
|
|
6.1.1 |
such Substitute Aircraft is subject to a Lease having aggregate Rental Payments for the remaining term of such Lease (aggregated across the Leases in respect of each Substitute Aircraft replacing such Remaining Aircraft) with
a present value that is no less than 90% of the present value of the aggregate Rental Payments for the remaining term of the Lease for the Remaining Aircraft subject to substitution (aggregated across such Leases) (with an
applied discount rate of 2% for purposes of both such present value calculations);
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|
6.1.2 |
the average age of each such Substitute Aircraft is not greater than the average age of the Remaining Aircraft subject to substitution, plus twelve (12) months;
|
|
6.1.3 |
the aggregate Base Purchase Price of the Substitute Aircraft replacing a Remaining Aircraft subject to substitution is equal to or less than the Base Purchase Price for the Remaining Aircraft subject to substitution unless an
amount equal to the excess has been funded to the Aircraft Acquisition Account using the proceeds of Additional Advances, and shall otherwise be mutually acceptable to the applicable Seller and the Issuers;
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|
6.1.4 |
each Substitute Aircraft is, at the time of the substitution thereof, subject to a Lease containing the Core Lease Provisions;
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|
6.1.5 |
the weighted average remaining term of each Lease of each Substitute Aircraft is, at the time of substitution thereof, greater than or equal to the weighted average remaining term of the Lease of the Remaining Aircraft
subject to substitution;
|
|
6.1.6 |
the addition of such Substitute Aircraft shall not result in a breach of the Concentration Limits;
|
|
6.1.7 |
not more than five (5) Remaining Aircraft may be replaced for Substitute Aircraft;
|
|
6.1.8 |
prior written notice of such Substitute Aircraft shall be provided to the Rating Agencies; and
|
|
6.1.9 |
such Substitute Aircraft must be of a Permitted Aircraft Type.
|
6.2 |
Effect of Substitution
|
6.3 |
Termination:
|
7. |
NON-DELIVERY EVENTS
|
7.1 |
Definition:
|
|
7.1.1 |
with respect to a particular Aircraft or Aircraft Interest, upon delivery of a Termination Notice, or upon termination of this Agreement pursuant to Clause 6.3, in each case with respect to such Aircraft or Aircraft Interest;
|
|
7.1.2 |
with respect to all Aircraft or Aircraft Interests with respect to which the Closing Date has not yet occurred at such time, upon the earlier to occur of:
|
|
(1) |
the applicable Seller becoming or being declared insolvent, or an examiner or receiver or liquidator or similar officer being appointed over such Seller or over all or a substantial part of its assets, or such Seller making
an arrangement for the benefit of its creditors generally or such Seller taking steps (or steps being taken and not discharged within 21 days) for the winding up or dissolution of such Seller or for the appointment of an
examiner to it;
|
|
(2) |
an Event of Default has occurred under the Indenture; and
|
|
(3) |
the Delivery Expiry Date.
|
7.2 |
Effect of Non-Delivery Event:
|
8. |
REPRESENTATIONS AND WARRANTIES OF SELLERS
|
8.1 |
Subject to Clause 8.2, each relevant Seller hereby represents and warrants with respect to such Seller and the relevant Aircraft or Aircraft Interest being transferred by such Seller in the terms of Schedule 1.
|
8.2 |
Each relevant Seller hereby warrants and represents to the applicable Issuer and the applicable Issuer Group Member that, save as disclosed in the Disclosure Letter (as updated and supplemented from time to time pursuant to
Clause 13.1):
|
|
8.2.1 |
each of the Warranties is true, correct and not misleading in all material respects on the Initial Closing Date with respect to the facts and circumstances existing at such time (and to the extent only that such Warranties
relate to the relevant Seller and any Aircraft, Transferring Company (including, where relevant, any Transferring Subsidiary of such Transferring Company) and/or Transferring Trust (including, where relevant, any Transferring
Subsidiary of that Transferring Trust), the Aircraft Interests which are being transferred on the Initial Closing Date by such Seller); and
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|
8.2.2 |
each of the Warranties is true, correct and not misleading in all material respects on each Closing Date with respect to the facts and circumstances existing at such time (and to the extent only that such Warranties relate to
the relevant Seller and any Aircraft, Transferring Company (including, where relevant, any Transferring Subsidiary of such Transferring Company) and/or Transferring Trust (including, where relevant, any Transferring Subsidiary
of such Transferring Trust) or the Aircraft Interests which are being transferred on such Closing Date by such Seller).
|
8.3 |
Separate and Independent:
|
8.4 |
Notice and Remedy for Breach:
|
|
8.4.1 |
At any time after the Closing of any Aircraft or Aircraft Interest, upon becoming aware of any breach of Warranty, the relevant Seller shall notify the Issuers or the Issuers shall be entitled to deliver to such Seller a
notice specifying the Warranty or Warranties which is or are untrue or incorrect by reference to the facts and circumstances subsisting at the relevant Closing Date with details of such facts or circumstances (a Breach Notice).
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|
8.4.2 |
The relevant Seller shall, on receipt or delivery by such Seller or applicable Issuer of a Breach Notice, have a period of 30 days (or such longer period as the Issuers may agree in writing) from the date of receipt by such
Seller or the Issuer, as applicable, of the Breach Notice to remedy the matter giving rise to the breach of Warranty (if capable of remedy) specified in such Breach Notice.
|
8.5 |
Disclaimer:
|
9. |
INDEMNITIES
|
9.1 |
Indemnities
|
|
9.1.1 |
The Issuers hereby jointly and severally agree to indemnify each Seller and their respective Affiliates, and any of their successors and assigns, officers, directors, servants, agents and employees (each a Seller Indemnified Party) from and against any claims, damages, losses, costs, expenses, fees (including reasonable counsel’s fees), payments, demands, liabilities, actions, proceedings,
penalties or fines (together, the Losses) which any Seller Indemnified Party may incur or suffer, (i) in relation to any Aircraft or Aircraft Interest to the extent it is attributable to
the period from and after the Closing for the relevant Aircraft or Aircraft Interest (subject to the provisions of Section 5.1 hereof) or (ii) in relation to any misrepresentation or breach of warranty, covenant or agreement
made or to be performed by the Issuer Group pursuant to this Agreement (together the Issuer Indemnity), provided that the Issuer Indemnity
provided pursuant to this Clause 9.1.1 shall not extend to any claim on account of any Taxes (which shall be subject to Clause 10.1) and provided further that the Issuer Indemnity shall
not extend to Losses arising from (x) the gross negligence, fraud or willful misconduct of any Seller Indemnified Party or (y) any misrepresentation or breach of warranty, covenant or agreement made by or to be performed by any
Seller Indemnified Party pursuant to this Agreement.
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|
9.1.2 |
Each Seller, severally and not jointly, hereby agrees to indemnify the Issuers, each Issuer Group Member and their respective Affiliates, and any of their successors and assigns, officers, directors, servants, agents and
employees (each an Issuer Indemnified Party) from and against any Losses which any Issuer Indemnified Party may incur or suffer, (i) in relation to any Aircraft or Aircraft Interest such
Seller sells hereunder to the extent it is attributable to the period prior to the Closing for such Aircraft or Aircraft Interest (subject to the provisions of Section 5.1 hereof) or (ii) in relation to any misrepresentation or
breach of warranty, covenant or agreement made or to be performed by such Seller pursuant to this Agreement (together the Seller Indemnity), provided
that the Seller Indemnity provided pursuant to this Clause 9.1.2 shall not extend to any claim on account of any Taxes (which shall be subject to Clause 10.1) and provided further that
the Seller Indemnity shall not extend to Losses arising from (x) the gross negligence, fraud or willful misconduct of any Issuer Indemnified Party or (y) any misrepresentation or breach of warranty, covenant or agreement
made by or to be performed by any Issuer Indemnified Party pursuant to this Agreement.
|
9.2 |
Notice of Claims:
|
|
9.2.1 |
Subject to Section 9.2.2, a Seller Indemnified Party or an Issuer Indemnified Party (each an Indemnified Party), as the case may be, shall give the Issuers and any relevant Seller (as
the case may be) (the Indemnifying Party) notice of any matter which such Indemnified Party has determined has given, or could give, rise to a right of indemnification under this
Agreement, within ninety (90) days of such determination. The notice shall state the amount of the Loss, if known, and the method of its calculation and shall contain a reference to the provisions of this Agreement in respect of
which such right of indemnification is claimed or arises.
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|
9.2.2 |
If an Indemnified Party receives written notice of any third party claim or potential claim (Third Party Claim) against it which is or may be the subject of a claim by it under the
Issuer Indemnity or the Seller Indemnity (as the case may be), the obligations and liabilities of the Indemnifying Party under this Clause 9 shall be subject to the following terms and conditions:
|
|
(1) |
the Indemnified Party shall give written notice thereof to the Indemnifying Party within sixty (60) days of receipt of such notice provided that failure to give such notice shall not
release the Indemnifying Party from any of its obligations under this Clause 9 except to the extent it has been materially prejudiced by such failure;
|
|
(2) |
the Indemnifying Party shall be entitled to assume and control the defense of such Third Party Claim and take such further action to contest, resist or appeal the validity, applicability and amount of such claim in
appropriate administrative or judicial proceedings either:
|
|
(a) |
in the name of the Indemnified Party (provided that the Indemnifying Party shall indemnify and secure the Indemnified Party to its reasonable satisfaction against all losses costs
damages and expenses which may be incurred thereby), or
|
|
(b) |
in its own name,
|
9.3 |
To Be Made Free From Deductions:
|
9.4 |
Recovery From Third Parties:
|
9.5 |
VAT / Consumption Tax:
|
|
9.5.1 |
Each amount that the Issuer Group must pay under this Agreement is stated inclusive of VAT. If VAT is payable in respect of any amount payable under this Agreement, the applicable Seller shall pay (and bear the cost of) any
such VAT to the relevant tax authority and such Seller shall only be entitled to recover any such VAT from the Issuer Group in accordance with Clauses 9.5.2 and 9.5.3 below.
|
|
9.5.2 |
The applicable Seller’s entitlement to recover from the Issuer Group any VAT arising pursuant to this Clause 9.5 shall be limited to the VAT amount in respect of which the Issuer Group has received a corresponding refund or
other form of credit from the relevant Governmental Authority.
|
|
9.5.3 |
To the extent that it is necessary to obtain a refund of VAT arising in respect of an amount payable under this Agreement, the applicable Issuer Group Member shall register for VAT in the relevant jurisdiction and take all
reasonable steps to recover such VAT, except, in the case of any VAT, to the extent that, in the Issuer Group Member’s reasonable judgment any such action would subject such Issuer Group Member to any material unreimbursed cost
or expense (which such Issuer Group Member would not have otherwise being required to bear) or would materially prejudice the legal or commercial position of such Issuer Group Member.
|
10. |
TAXES
|
10.1 |
Tax Indemnity
|
10.2 |
If any Seller or Issuer Group Member is notified of the commencement of any audit or other administrative or judicial proceeding in respect of Taxes for which an indemnity may be sought pursuant to this Clause 10, then such
receiving party shall inform the other party and the Issuers (unless the Issuers received the relevant notice) in writing of such proceeding within forty five (45) days after the relevant notice was received by the receiving
party, and the receiving party shall give the other party such information with respect thereto as the other party may reasonably request; provided that the failure of an Issuer Group Member to so inform another party shall not
limit such Issuer Group Member’s rights to indemnification under this Clause 10, except as provided in the last sentence of this Clause 10.3. The party required to indemnify the other party for such Taxes pursuant to this Clause
10 (the Tax Indemnifying Party) may discharge, at any time, its indemnification obligation under this Clause 10 by paying to the other party or the relevant taxing authority, as the case
may be, the amount payable pursuant to this Clause 10. Except in cases where the Tax Indemnifying Party have discharged their obligations pursuant to the preceding sentence, the Tax Indemnifying Party may, at its own expense,
take control of the conduct of any such audit or other administrative or judicial proceeding unless otherwise prohibited by applicable law (in which case, the Tax Indemnifying Party shall be entitled to participate in the
conduct of such audit or other administrative or judicial proceeding); provided, however, that if the Tax Indemnifying Party enters into any settlement of such audit or other administrative or judicial proceeding,
and such settlement results in an increase in Taxes under this Clause 10, then the Tax Indemnifying Party shall indemnify and hold harmless the relevant Issuer Indemnified Party against such increase. If the Tax Indemnifying
Party takes control of the conduct of such audit or other administrative or judicial proceeding, the Tax Indemnifying Party shall have the sole discretion as to the conduct of such audit or other proceeding; provided that the
relevant Seller at its request may participate in (but no control) such proceeding. Whether or not the Tax Indemnifying Party chooses to defend or prosecute any claim, the applicable Seller and Issuer Group Member shall
cooperate in the defense or prosecution thereof. No Tax Indemnifying Party shall be liable under this Clause 10 for any settlements effected without its consent (not to be unreasonably withheld), or resulting from any audit or
other administrative or judicial proceeding to the extent (but only to the extent) any failure to notify the Tax Indemnifying Party of such audit or other administrative or judicial proceeding materially prejudices such Tax
Indemnifying Party from contesting the Tax in which the Tax Indemnifying Party is responsible under this Clause 10.
|
10.3 |
Each Seller and each Issuer Group Member agree to treat sales with respect to each Aircraft and Aircraft Interest hereunder as occurring on the relevant Closing Date for U.S. and Irish corporate income tax purposes.
|
10.4 |
The applicable Seller and Issuer Group Member of any Aircraft or Aircraft Interest shall act reasonably in agreeing to the delivery location for the relevant Aircraft, which shall be in a jurisdiction where both such Seller
and Issuer Group Member have determined, in each of their sole but reasonable discretion, that there are no material Taxes (other than net or overall gross income Taxes imposed on such Seller) that would be imposed upon either
or both Issuers, such Issuer Group Member, such Seller (including by application of this Clause 10) or such Aircraft as a result of the transfer of title to, or the beneficial interest in, the applicable Aircraft or Aircraft
Interest to such Issuer Group Member. Notwithstanding anything to the contrary herein, such Issuer Group Member’s agreement (or lack of objection) to any delivery location shall not prejudice, impair, limit or otherwise modify
such Issuer Group Member’s rights to indemnification under this Clause 10. The Issuers and the relevant Issuer Group Member both covenant that they shall timely pay (or shall cause the timely payment of) all Transfer Taxes.
|
10.5 |
Each Seller hereby covenants that any tax sharing agreements, tax settlement agreements, arrangements, policies or guidelines, formal or informal, express or implied that may exist between any relevant Transferring Company
(including, where relevant, any Transferring Subsidiary of such Transferring Company) or Transferring Trust (including, where relevant, any Transferring Subsidiary of such Transferring Trust) and such Seller or any Affiliate
thereof (a Tax Sharing Agreement) shall terminate as of the Closing Date and, except as specifically provided herein, any obligation to make payments by any party under any Tax Sharing
Agreement shall be cancelled as of the Closing Date.
|
11. |
LIMITATIONS ON WARRANTIES AND INDEMNITIES
|
11.1 |
Time Limit on Claims:
|
11.2 |
Financial Limit on Claims:
|
|
11.2.1 |
all Sellers and their respective Affiliates arising out of or resulting from or by reason of any claims under or pursuant to (i) the Warranties, and/or (ii) this Agreement shall not exceed $250,000,000 in the aggregate; provided that no financial limit shall apply to any claim in respect of any Unlimited Warranty;
|
|
11.2.2 |
the Issuer Group arising out of or resulting from or by reason of any claims under or pursuant to (i) the Issuer Warranties, (ii) the Issuer Indemnity and/or (iii) this Agreement shall not exceed the sum of the Base Purchase
Prices of all Aircraft. Each Seller hereby agrees and acknowledges, on behalf of itself and each other Seller Indemnified Party, that any Seller Indemnified Party shall be entitled to payment of a claim under the Issuer
Indemnity only to the extent there are sufficient funds available therefor in accordance with the provisions of Section 3.09(a) or (b) (as applicable) of the Indenture and only after payment of any Prior Ranking Amounts; and
|
|
11.2.3 |
the Sellers and their respective Affiliates shall only be liable in respect of any claims under or pursuant to (i) the Warranties, and/or (ii) this Agreement, in each case if the aggregate liability of such Persons for any
individual claim would exceed in aggregate $100,000. In the event that such claim exceeds $100,000, such Persons shall be liable (subject to Sections 9, 10 and 11) for the full amount of such claim.
|
12. |
REPRESENTATIONS AND WARRANTIES OF THE ISSUER GROUP
|
13. |
ADDITIONAL COVENANTS AND AGREEMENTS
|
13.1 |
Further Action:
|
13.2 |
Manufacturers’ Warranties/ Further Assurance:
|
14. |
CONDITIONS
|
14.1 |
Conditions To Obligations of Sellers:
|
|
14.1.1 |
the conditions set forth in Clause 3 with respect to such Aircraft or Aircraft Interest shall have been satisfied;
|
|
14.1.2 |
in the case of a Transferring Company (or any relevant Transferring Subsidiary of such Transferring Company) compliance with rules regarding provision of financial assistance, if any, in the jurisdiction of incorporation of
such Transferring Company (or any relevant Transferring Subsidiary of such Transferring Company), to include in the case of any Transferring Company (or any relevant Transferring Subsidiary of such Transferring Company) which is
incorporated in Ireland compliance with the procedure set out in section 82 of the Irish Companies Act 2014;
|
|
14.1.3 |
unless consented to by the applicable Issuer, no enactment, amendment or modification to a statute, order or statutory instrument passed after the date of this Agreement shall have caused any Warranty of the applicable Seller
to be untrue or incorrect;
|
|
14.1.4 |
all authorizations, consents, orders and approvals of Government Authorities and officials listed in the Disclosure Letter (as updated pursuant to Clause 13.1) having been obtained in form and substance reasonably
satisfactory to the applicable Seller;
|
|
14.1.5 |
the representations and warranties of the Issuer Group contained in Schedule 2 being true and correct in all material respects when made and on the applicable Closing Date, other than such representations and warranties as
are made on another date, and the covenants and agreements contained in this Agreement to be complied with by the Issuer Group on or before Closing having been complied with in all material respects, and such Seller having
received a duly executed certificate of the applicable Issuer Group Member to such effect on the date of such Closing;
|
|
14.1.6 |
no Action having been commenced by or before any Governmental Authority against any Seller, the Issuer Group, such Transferring Trust (or any relevant Transferring Subsidiary of such Transferring Trust) or Transferring
Company (or any relevant Transferring Subsidiary of such Transferring Company) or any of them seeking to restrain or materially and adversely alter the transactions contemplated by this Agreement which, in the reasonable, good
faith determination of the applicable Seller, is likely to render it impossible or unlawful for any of the parties to perform their obligations hereunder, provided however that this
condition shall not apply to any Action directly or indirectly solicited or encouraged by such Seller;
|
|
14.1.7 |
the applicable Issuer or applicable Issuer Group Member having performed or having satisfied in all material respects all covenants, agreements and conditions on its part to be performed or satisfied by it under this
Agreement and no material default on the part of the applicable Issuer Group Member having occurred and being still in existence, or resulting from the execution, delivery or performance of this Agreement under any Other
Transaction Document;
|
|
14.1.8 |
receipt of a copy of the resolution of the board of directors of the applicable Issuer or applicable Issuer Group Member duly authorizing the execution, delivery and performance by the such Issuer or such Issuer Group Member
of this Agreement and the transactions contemplated hereby and thereby;
|
|
14.1.9 |
receipt of a certificate of a director or of the secretary of the applicable Issuer or applicable Issuer Group Member certifying the names and signatures of each of the directors or other officers of such Issuer or such
Issuer Group Member authorized to sign this Agreement and the documents to be delivered hereunder and thereunder;
|
|
14.1.10 |
in the case of any Aircraft that is a Substitute Aircraft, receipt by the applicable Seller of any amounts owing to it pursuant to Clause 6.2; and
|
|
14.1.11 |
receipt of an insurance and, if applicable, reinsurance certificate in respect of the relevant Aircraft evidencing that the relevant Seller and such other persons as such Seller shall specify are named as an additional
insureds for liability insurances for the tail period set forth in the relevant Lease.
|
14.2 |
Conditions To Obligations of The Issuer Group:
|
|
14.2.1 |
the conditions set forth in Clause 3 with respect to such Aircraft or Aircraft Interest shall have been satisfied;
|
|
14.2.2 |
in the case of a Transferring Company and any Transferring Subsidiary of such Transferring Company, compliance with rules regarding provision of financial assistance, if any, in the jurisdiction of incorporation of such
Transferring Company and Transferring Subsidiary;
|
|
14.2.3 |
the relevant Seller, Transferring Trust (or any relevant Transferring Subsidiary of such Transferring Trust) or Transferring Company (or any relevant Transferring Subsidiary of such Transferring Company) being the owner of
the Aircraft specified in the applicable Delivery Notice (or, in the case of a Transferring Title Aircraft which is a Non-Owned Aircraft, having the right upon valid tender by the relevant Aircraft Owner pursuant to the terms of
the relevant Aircraft Purchase Agreement to take title (or nominate another Person to take title) to such Aircraft);
|
|
14.2.4 |
all authorizations, consents, orders and approvals of Government Authorities and officials listed in the Disclosure Letter (as updated pursuant to Clause 13.1 hereof) having been obtained in form and substance reasonably
satisfactory to the Issuers;
|
|
14.2.5 |
subject to such matters as may be disclosed in the Disclosure Letter (as updated pursuant to Clause 13.1 hereof), the Warranties being true and correct in all material respects on the applicable Closing Date, other than such
Warranties as are made on another date, and the covenants and agreements contained in this Agreement to be complied with by the Sellers on or before the relevant Closing having been complied with in all material respects in
relation to such Aircraft, Seller, Transferring Trust (and any relevant Transferring Subsidiary of such Transferring Trust) or Transferring Company (and any relevant Transferring Subsidiary of such Transferring Company) and the
applicable Issuer Group Member having received a duly executed certificate from the relevant Seller to such effect on the date of such Closing;
|
|
14.2.6 |
no Action having been commenced or threatened by or before any Governmental Authority against the relevant Seller, the Issuer Group, any relevant Transferring Trust (or any relevant Transferring Subsidiary of such
Transferring Trust) or Transferring Company (or any relevant Transferring Subsidiary of such Transferring Company) or any of them seeking to restrain or materially and adversely alter the transactions contemplated hereby which
the Issuers reasonably believe is likely to render it impossible or unlawful for any of the parties to perform their obligations hereunder; provided however that this condition shall not
apply to any Action solicited or encouraged by the Issuers or any other Issuer Group Member;
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|
14.2.7 |
the Other Transaction Documents relating to such Aircraft, Transferring Company (and any relevant Transferring Subsidiary of such Transferring Company) or Transferring Trust (and any relevant Transferring Subsidiary of such
Transferring Trust) or the relevant Seller having been duly entered into and having become unconditional in all respects save for any conditions relating to this Agreement or the satisfaction of the conditions precedent
hereunder;
|
|
14.2.8 |
receipt of copies of the reports of the Appraisers (including, if applicable, with respect to Substitute Aircraft);
|
|
14.2.9 |
receipt of the Disclosure Letter, if any, (including any updated and/or supplements to the applicable Closing Date) in form and substance reasonably satisfactory to the Issuers;
|
|
14.2.10 |
receipt of a broker’s letter and insurance certificate with respect to the relevant Aircraft, if any, owned by such Seller (or, in the case of a Transferring Title Aircraft which is a Non-Owned Aircraft, which the Seller has
the right upon valid tender by the relevant Aircraft Owner pursuant to the terms of the relevant Aircraft Purchase Agreement to take title (or nominate another Person to take title) to such Aircraft), Transferring Trust (or any
relevant Transferring Subsidiary of such Transferring Trust) or Transferring Company (or any relevant Transferring Subsidiary of such Transferring Company) evidencing compliance with the requirements set forth in Exhibit D of
the Indenture and the related Lease;
|
|
14.2.11 |
receipt of evidence (including the results of any applicable customary lien search) satisfactory to the applicable Issuer Group Member that there are is no mortgage, charge, pledge of or other security over the Aircraft or
over the Shares in such Transferring Company (or any relevant Transferring Subsidiary of such Transferring Company) or the Beneficial Interest in such Transferring Trust (or any relevant Transferring Subsidiary of such
Transferring Trust) (as the case may be), or that any such security has been released (or will be released after Closing in a manner reasonably satisfactory to the Issuers);
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|
14.2.12 |
a copy of the organizational or constitutional documents of each relevant Transferring Company (and any Transferring Subsidiary of such Transferring Company) or Transferring Trust (and any relevant Transferring Subsidiary of
such Transferring Trust), if any, certified as of such Closing Date to be a true, complete and up-to-date copy by a director, manager, secretary or other officer of such Transferring Company (or any Transferring Subsidiary of
such Transferring Company) or Transferring Trust (or any relevant Transferring Subsidiary of such Transferring Trust), as applicable, and in a form satisfying the requirements of the Indenture;
|
|
14.2.13 |
a copy of resolutions of the directors and/or board of managers or other applicable governing body of the relevant Seller (and, if different, any applicable Aircraft Owner and/or Trustor), in each case certified as of such
Closing Date to be a true, complete and up to date copy and as being in full force and effect and not amended or rescinded by a director, manager, secretary or other officer of the relevant Seller (and, if different, any
applicable Aircraft Owner and/or Trustor), approving or authorizing the transactions contemplated by this Agreement, including an incumbency certificate (or equivalent document) of the Person or Persons authorized to execute and
deliver on behalf of such relevant Seller (and, if different, any applicable Aircraft Owner and/or Trustor) this Agreement and any notices or other documents to be given pursuant hereto or thereto;
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|
14.2.14 |
The following legal opinions in the Agreed Form shall be delivered dated as of the applicable Closing Date:
|
|
(a) |
an opinion of counsel as to the laws of the jurisdiction of such Person in respect of the applicable Seller (and, if different, any applicable Aircraft Owner and/or Trustor) as to its incorporation, formation or registration
and its execution, delivery and performance of the documents to which it is a party contemplated by this Agreement and related matters;
|
|
(b) |
an opinion of counsel as to the laws of the jurisdiction of such Person in respect of any relevant Transferring Company (and any Transferring Subsidiary of such Transferring Company), Transferring Trust (and any relevant
Transferring Subsidiary of such Transferring Trust) or the applicable Issuer Group Member (and as applicable, an Issuer) as to its incorporation, formation or registration and its execution, delivery and performance of the
documents to which it is a party contemplated by this Agreement and related matters;
|
|
(c) |
an opinion of independent or in-house counsel, as applicable, to the relevant Guarantor as to such Guarantor’s incorporation, formation or registration and such Guarantor’s execution, delivery and performance of the relevant
Guaranty;
|
|
(d) |
an opinion of New York counsel as to the enforceability of the documents governed by New York law entered into in connection with the Closing and related matters;
|
|
(e) |
an opinion of counsel as to any applicable filings or registrations with the FAA and/or the International Registry as required under the Security Trust Agreement in connection with the Closing; and
|
|
(f) |
an opinion of counsel as to the laws of the jurisdiction of the Lessee and the jurisdiction of registration of the Aircraft (if different) as to such matters in such jurisdiction as are contemplated in the Agreed Form
thereof;
|
|
14.2.15 |
if, on the relevant Closing Date, any Security Deposit or Maintenance Rent held or supported under the Lease for the relevant Aircraft is in the form of a letter of credit, guarantee, promissory note or other instrument, and
not already issued in the name of the Servicer or any relevant Transferring Company, Transferring Trust or Transferring Subsidiary, the applicable Seller shall cause such letter of credit, guarantee or other instrument to be
duly endorsed, amended or reissued in favor of the relevant Issuer Group Member within ninety (90) days of the relevant Closing Date;
|
|
14.2.16 |
any relevant Transferring Company (and any Transferring Subsidiary of such Transferring Company) or Transferring Trust (and any relevant Transferring Subsidiary of such Transferring Trust), or if none, the applicable Issuer
Group Member, and the applicable Issuer shall have duly executed and delivered each document required by an Issuer Group Member under the Related Documents in connection with the Closing, including a Collateral Supplement or
Grantor Supplement (as applicable), accession agreements and guaranties in the forms set forth in the Security Trust Agreement and agreements with the Service Providers, any powers of attorney in favor of a Service Provider
required thereunder, an FAA security document (if applicable) and any local law security document required to be provided pursuant to the Security Trust Agreement;
|
|
14.2.17 |
in the case of a Transferring Company, the applicable Seller having delivered to the applicable Issuer Group Member a solvency certificate in respect of such Transferring Company and a solvency certificate in respect of such
Seller, in each case in a form agreed with the applicable Issuer on the date hereof and on each Closing Date;
|
|
14.2.18 |
insofar as it has not been already provided to the applicable Issuer or applicable Issuer Group Member or is not held by a Transferring Company or Transferring Trust (or a subsidiary of it), receipt by the applicable Issuer
or applicable Issuer Group Member of a copy of the applicable Lease relating to the Aircraft owned by or leased by (as applicable) the relevant Aircraft Owner, Transferring Trust or Transferring Company (or its subsidiaries),
along with the tangible chattel paper original of such Lease (or if an original was never so designated or such original has been lost, a certificate from the applicable Seller to such effect) on the applicable Closing Date; and
|
|
14.2.19 |
all the conditions precedent to the effectiveness of the Novation Agreement, as applicable, for the applicable Aircraft which are expressed to be for the benefit of the Issuer Group Member shall have been satisfied.
|
14.3 |
Legal Opinions:
|
14.4 |
Further Condition and Agreement:
|
15. |
MISCELLANEOUS
|
15.1 |
Waiver:
|
15.2 |
Notices:
|
|
15.2.1 |
be in writing delivered personally, or by prepaid courier delivery services such as Federal Express, DHL or other similar services, or facsimile (confirmed, in the case of facsimile, by prepaid airmail letter sent within 24
hours of dispatch but so that non-receipt of such confirmation shall not affect in any way the validity of the facsimile in question). Notices may be sent by e-mail (including pdf or other attachment to e-mail) if the receiving
party has provided the sending party an e-mail address in the address information at 15.2.3 below (as such address information may have been updated in accordance with this Clause 15);
|
|
15.2.2 |
be deemed to have been received, subject as otherwise provided in this Agreement in the case of an e-mail, upon the date the sender’s receipt of an acknowledgment from the intended recipient (such as by the return receipt
requested function, return e-mail or other written acknowledgment), in the case of a facsimile, at the time of dispatch with confirmed answerback of the addressee appearing at the beginning and end of the communication, (provided, however, that, in the case of a facsimile or an e-mail, if the date of dispatch is not a Business Day in the country of the addressee it shall be deemed to have been received at the
opening of business on the next such Business Day and provided further that such notice or communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been
sent at the opening of business on the next Business Day for the recipient), and in the case of a letter, when delivered personally; provided, however, that if personal delivery or
delivery by courier of a notice is tendered but refused, such notice shall be effective upon such tender; and
|
|
15.2.3 |
be sent:
|
15.3 |
Severability:
|
15.4 |
Assignment; Third Party Beneficiary:
|
15.5 |
Amendment:
|
15.6 |
Applicable Law and Jurisdiction:
|
|
15.6.1 |
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
|
|
15.6.2 |
Each party hereto hereby submits to the nonexclusive jurisdiction of the United States District Court for the Southern District of New York and of any New York State court sitting in New York County for the purposes of all
legal proceedings arising out of or relating to this Agreement and each other Transaction Document or the transactions contemplated hereby or thereby. Each of the parties hereto irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the laying of the venue of any such proceeding brought in such a court and any claim that any such proceeding brought in such a court has been brought in an
inconvenient forum. Each Issuer agrees that the process by which any suit, action or proceeding in any such court is begun may be served on it by being delivered to Corporation Service Company (the “Agent”), 1180 Avenue of the Americas, Suite 210, New York, New York 10036 U.S.A., its designee, appointee and agent to receive, accept and acknowledge for and on its behalf such service of legal process. Without
limiting the effect of the immediately preceding sentence, each of the parties hereto hereby irrevocably consents to the service of any and all process in any such action or proceeding by the mailing of copies to it or in any
other manner permitted by Applicable Law.
|
|
15.6.3 |
TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES THE RIGHT TO DEMAND A TRIAL BY JURY, IN ANY SUCH SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF THIS AGREEMENT, THE OTHER
TRANSACTION DOCUMENTS, OR THE SUBJECT MATTER HEREOF OR THEREOF OR THE OVERALL TRANSACTION BROUGHT BY ANY OF THE PARTIES HERETO OR THEIR SUCCESSORS OR ASSIGNS.
|
|
15.6.4 |
Nothing in this Clause 15.6 limits the right of each of the parties hereto to bring proceedings against another party hereto in connection with this Agreement (i) in any other court of competent jurisdiction; or (ii)
concurrently in more than one jurisdiction.
|
15.7 |
Survival After Closing:
|
15.8 |
Entire Agreement; Counterparts:
|
15.9 |
Issuer Limited Recourse:
|
FLY AIRCRAFT HOLDINGS TWENTY LIMITED
|
|||
By:
|
/s/ Declan Cotter
|
|
|
Name: Declan Cotter
|
|||
Title: Director
|
JUPITER AVIATION 2 LLC
|
|||
By:
|
/s/ Michael Blumenthal
|
||
Name: Michael Blumenthal
|
|||
Title: Manager
|
FLY AIRCRAFT HOLDINGS THIRTY-TWO LIMITED
|
|||
By:
|
/s/ Declan Cotter
|
||
Name: Declan Cotter
|
|||
Title: Director
|
FLY AIRCRAFT HOLDINGS THIRTY-ONE LIMITED
|
|||
By:
|
/s/ Declan Cotter
|
||
Name: Declan Cotter
|
|||
Title: Director
|
SAP MERIDIAN 17 LP
|
|||
By:
|
/s/ Vincent Cannon
|
||
Name: Vincent Cannon
|
|||
Title: Vice President
|
MERAH AIRCRAFT 5 LIMITED
|
|||
By:
|
/s/ Declan Cotter
|
||
Name: Declan Cotter
|
|||
Title: Director
|
WELLS FARGO TRUST COMPANY, NATIONAL ASSOCIATION, NOT IN ITS INDIVIDUAL CAPACITY BUT SOLELY AS OWNER TRUSTEE OF THE 737 MSN 34596 TRUST
|
|||
By:
|
/s/ J. Brent Allen
|
||
Name: J. Brent Allen
|
|||
Title: Vice President
|
FLY AIRCRAFT HOLDINGS ONE LIMITED
|
|||
By:
|
/s/ Declan Cotter
|
||
Name: Declan Cotter
|
|||
Title: Director
|
FLY AIRCRAFT HOLDINGS TWENTY-FOUR LIMITED
|
|||
By:
|
/s/ Declan Cotter
|
||
Name: Declan Cotter
|
|||
Title: Director
|
WELLS FARGO TRUST COMPANY, NATIONAL ASSOCIATION, NOT IN ITS INDIVIDUAL CAPACITY BUT SOLELY AS OWNER TRUSTEE OF THE B&B AIR ACQUISITION 34953 TRUST
|
|||
By:
|
/s/ J. Brent Allen
|
||
Name: J. Brent Allen
|
|||
Title: Vice President
|
AMETHYST AIRCRAFT LEASING LIMITED
|
|||
By:
|
/s/ Declan Cotter
|
||
Name: Declan Cotter
|
|||
Title: Director
|
JUPITER AVIATION 1 LLC
|
|||
By:
|
/s/ Michael Blumenthal
|
||
Name: Michael Blumenthal
|
|||
Title: Manager
|
CARNELIAN AIRCRAFT LEASING LIMITED
|
|||
By:
|
/s/ Declan Cotter
|
||
Name: Declan Cotter
|
|||
Title: Director
|
SAP MERIDIAN AVIATION 25 LIMITED
|
|||
By:
|
/s/ Maurice Prendergast
|
||
Name: Maurice Prendergast
|
|||
Title: Director
|
HORIZON AIRCRAFT FINANCE II LIMITED
|
|||
By:
|
/s/ Colm Davis
|
||
Name: Colm Davis
|
|||
Title: Director
|
HORIZON AIRCRAFT FINANCE II LLC
|
|||
By:
|
/s/ Edward L. Truitt Jr.
|
||
Name: Edward L. Truitt Jr.
|
|||
Title: Independent Manager
|