Fly Leasing Ltd (Form: 20-F, Received: 02/28/2020 17:20:31)

Exhibit 2.2

DESCRIPTION OF THE REGISTRANT’S SECURITIES

REGISTERED PURSUANT TO SECTION 12 OF THE

SECURITIES EXCHANGE ACT OF 1934

As of December 31, 2019, Fly Leasing Limited (“we,” “us” or “our”) had the following series of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”): (i) our common shares, par value $0.001 per share (the “common shares”) and (ii) our American Depositary Shares (the “American Depositary Shares”).

DESCRIPTION OF COMMON SHARES

Our authorized share capital consists of $500,000 divided into 499,999,900 common shares and 100 manager shares, par value $0.001 each. Pursuant to our amended and restated bye-laws (“bye-laws”), subject to any resolution of the shareholders to the contrary, our board of directors is authorized to issue any of our authorized but unissued shares.

Holders of common shares have no pre-emptive, redemption, conversion or sinking fund rights. Holders of common shares are entitled to one vote per share on all matters submitted to a vote of holders of common shares. Unless a different majority is required by law or by our bye-laws, resolutions to be approved by holders of common shares require approval by a simple majority of votes cast at a meeting at which a quorum is present. There are no limitations on the right of non-Bermudians or non-residents of Bermuda to hold or vote our shares except as described herein.

In the event of our liquidation, dissolution or winding up, the holders of common shares are entitled to share equally and ratably in our assets, if any, remaining after the payment of all of our debts and liabilities, subject to any liquidation preference on any issued and outstanding preference shares.

Dividend Rights

Pursuant to Bermuda law, we are restricted from declaring or paying a dividend if there are reasonable grounds for believing that (1) we are, or would after the payment be, unable to pay our liabilities as they become due, or (2) the realizable value of our assets would thereby be less than our liabilities.

There are no restrictions on our ability to transfer funds (other than funds denominated in Bermuda dollars) in and out of Bermuda or to pay dividends to U.S. residents who are holders of our common shares.

Variation of Rights

If at any time we have more than one class of shares, the rights attaching to any class, unless otherwise provided for by the terms of issue of the relevant class, may be varied either: (1) with the consent in writing of the holders of 50% of the issued shares of that class; or (2) with the sanction of a resolution passed by a majority of the votes cast at a general meeting of the relevant class of shareholders at which a quorum consisting of at least two persons holding or representing two-thirds of the issued shares of the relevant class is present. Our bye-laws specify that the creation or issue of shares ranking equally with existing shares will not, unless expressly provided by the terms of issue of existing shares, vary the rights attached to existing shares. In addition, the creation or issue of preference shares ranking prior to common shares will not be deemed to vary the rights attached to common shares or, subject to the terms of any other series of preference shares, to vary the rights attached to any other series of preference shares.

Election and Removal of Directors

Our bye-laws provide that our board shall consist of not less than two and not more than 15 directors as the board may from time to time determine. Our board of directors currently consists of seven directors, each of whom serves a term commencing on their election or appointment and continuing until the next annual general meeting or until their successors are elected or appointed or their office is otherwise vacated. Our bye-laws provide that persons standing for election as directors at a duly constituted and quorate annual general meeting are appointed by shareholders holding shares carrying a plurality of the votes cast on the resolution. Notwithstanding the foregoing, pursuant to our management agreement and our bye-laws, so long as our manager, Fly Leasing Management Co. Limited, or the Manager, holds any of our manager shares, our Manager has the right to appoint the whole number of directors on our board of directors that is nearest to but not more than 3/7th of the number of directors on our board of directors at the time. These directors are not required to stand for election by shareholders other than our Manager.

Any shareholder holding at least five percent of the Company’s common shares may propose for election as a director someone who is not an existing director or is not proposed by our board by giving notice of the intention to propose the person for election. Where a person is to be proposed for election as a director at an annual general meeting by a shareholder, that notice must be given not less than 90 days nor more than 120 days before the anniversary of the last annual general meeting prior to the giving of the notice or, in the event the annual general meeting is called for a date that is not 25 days before or after such anniversary the notice must be given not later than ten days following the earlier of the date on which notice of the annual general meeting was posted to shareholders or the date on which public disclosure of the date of the annual general meeting was made.

A director (other than a director appointed by the Manager pursuant to its appointment right described above) may be removed with or without cause by a resolution including the affirmative vote of shareholders holding shares carrying at least 80% of the votes of all shares then issued and entitled to vote on the resolution, provided that notice of the shareholders meeting convened to remove the director is given to the director. The notice must contain a statement of the intention to remove the director and must be served on the director not less than 14 days before the meeting. The director is entitled to attend the meeting and be heard on the motion for his removal. A director appointed by the Manager pursuant to its appointment right described above may be removed with or without cause by the Manager upon notice from the Manager.

Anti-Takeover Provisions

The following is a summary of certain provisions of our bye-laws that may be deemed to have an anti-takeover effect and may delay, deter or prevent a tender offer or takeover attempt that a shareholder might consider to be in its best interest, including those attempts that might result in a premium over the market price for the shares held by shareholders.

Pursuant to our bye-laws, our preference shares may be issued from time to time, and the board of directors is authorized to determine the rights, preferences, privileges, qualifications, limitations and restrictions.

The authorized but unissued common shares and our preference shares will be available for future issuance by the board of directors, subject to any resolutions of the shareholders. These additional shares may be utilized for a variety of corporate purposes, including future public offerings to raise additional capital, corporate acquisitions and employee benefit plans. The existence of authorized but unissued common shares and preference shares could render more difficult or discourage an attempt to obtain control over us by means of a proxy contest, tender offer, amalgamation or otherwise.

Our bye-laws provide that if a competitor of BBAM LP acquires beneficial ownership of 15% or more of our common shares, then we have the option, but not the obligation, within 90 days of the acquisition of such threshold beneficial ownership, to require that shareholder to tender for all of our remaining common shares, or to sell such number of common shares to us or to third parties at fair market value as would reduce its beneficial ownership to less than 15%. In addition, our bye-laws provide that the vote of each common share held by a competitor of BBAM LP that beneficially owns 15% or more, but less than 50%, of our common shares will be reduced to three-tenths of a vote per share on all matters upon which shareholders may vote.

Certain Provisions of Bermuda Law

We have been designated by the Bermuda Monetary Authority as a non-resident for Bermuda exchange control purposes. This designation allows us to engage in transactions in currencies other than the Bermuda dollar, and there are no restrictions on our ability to transfer funds (other than funds denominated in Bermuda dollars) in and out of Bermuda or to pay dividends to United States residents who are holders of our common shares.

The Bermuda Monetary Authority has given its consent for the issue and free transferability of all of the common shares that underlie the American Depositary Shares, or ADSs, that are the subject of this offering to and between non-residents of Bermuda for exchange control purposes, provided our ADSs remain listed on an appointed stock exchange, which includes the NYSE. Approvals or permissions given by the Bermuda Monetary Authority do not constitute a guarantee by the Bermuda Monetary Authority as to our performance or our creditworthiness. Accordingly, in giving such consent or permissions, the Bermuda Monetary Authority shall not be liable for the financial soundness, performance or default of our business or for the correctness of any opinions or statements expressed in this prospectus. Certain issues and transfers of common shares involving persons deemed resident in Bermuda for exchange control purposes may require the specific consent of the Bermuda Monetary Authority.

In accordance with Bermuda law, share certificates are only issued in the names of companies, partnerships or individuals. In the case of a shareholder acting in a special capacity (for example as a trustee), certificates may, at the request of the shareholder, record the capacity in which the shareholder is acting. Notwithstanding such recording of any special capacity, we are not bound to investigate or see to the execution of any such trust. We will take no notice of any trust applicable to any of our shares, whether or not we have been notified of such trust.

Differences in Corporate Law

You should be aware that the Companies Act 1981 (Bermuda), or the Companies Act, which applies to us, differs in certain material respects from laws generally applicable to Delaware corporations and their shareholders. In order to highlight these differences, set forth below is a summary of certain significant provisions of the Companies Act (including modifications adopted pursuant to our bye-laws) and Bermuda common law applicable to us which differ in certain respects from provisions of the General Corporation Law of the State of Delaware. Because the following statements are summaries, they do not address all aspects of Bermuda law that may be relevant to us and our shareholders or all aspects of Delaware law which may differ from Bermuda law.

Duties of Directors

Our bye-laws provide that our business is to be managed and conducted by our board of directors. At common law, members of the board of directors of a Bermuda company owe a fiduciary duty to the company to act in good faith in their dealings with or on behalf of the company and exercise their powers and fulfill the duties of their office honestly. This duty includes the following essential elements:

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a duty to act in good faith in the best interests of the company;

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a duty not to make a personal profit from opportunities that arise from the office of director;

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a duty to avoid conflicts of interest; and

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a duty to exercise powers for the purpose for which such powers were intended.

The Companies Act imposes a duty on directors and officers of a Bermuda company:

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to act honestly and in good faith with a view to the best interests of the company; and

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to exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.

In addition, the Companies Act imposes various duties on directors and officers of a company with respect to certain matters of management and administration of the company.

Directors and officers generally owe fiduciary duties to the company, and not to the company’s individual shareholders. Our shareholders may not have a direct cause of action against our directors.

Under Delaware law, the business and affairs of a corporation are managed by or under the direction of its board of directors. In exercising their powers, directors are charged with a fiduciary duty of care to protect the interests of the corporation and a fiduciary duty of loyalty to act in the best interests of its shareholders. The duty of care requires that directors act in an informed and deliberative manner and inform themselves, prior to making a business decision, of all material information reasonably available to them. The duty of care also requires that directors exercise care in overseeing and investigating the conduct of corporate employees. The duty of loyalty may be summarized as the duty to act in good faith, not out of self-interest, and in a manner which the director reasonably believes to be in the best interests of the shareholders.

Delaware law provides that a party challenging the propriety of a decision of a board of directors bears the burden of rebutting the applicability of the presumptions afforded to directors by the “business judgment rule.” The business judgment rule is a presumption that in making a business decision, directors acted on an informed basis and that the action taken was in the best interests of the company and its shareholders, and accordingly, unless the presumption is rebutted, a board’s decision will be upheld unless there can be no rational business purpose for the action or the action constitutes corporate waste. If the presumption is not rebutted, the business judgment rule attaches to protect the directors and their decisions, and their business judgments will not be second guessed. Where, however, the presumption is rebutted, the directors bear the burden of demonstrating the entire fairness of the relevant transaction.

Notwithstanding the foregoing, Delaware courts may subject directors’ conduct to enhanced scrutiny in respect of defensive actions taken in response to a threat to corporate control or the approval of a transaction resulting in a sale of control of the corporation.

Interested Directors

Bermuda law and our bye-laws provide that if a director has an interest in a material transaction or proposed material transaction with us or any of our subsidiaries or has a material interest in any person that is a party to such a transaction, the director must disclose the nature of that interest at the first opportunity either at a meeting of directors or in writing to the directors. Our bye-laws provide that, after a director has made such a declaration of interest, he is allowed to be counted for purposes of determining whether a quorum is present and to vote on a transaction in which he has an interest, unless disqualified from doing so by the chairman of the relevant board meeting.

Under Delaware law, such transaction would not be voidable if (1) the material facts as to such interested director’s relationship or interests are disclosed or are known to the board of directors and the board in good faith authorizes the transaction by the affirmative vote of a majority of the disinterested directors, (2) such material facts are disclosed or are known to the shareholders entitled to vote on such transaction and the transaction is specifically approved in good faith by vote of the majority of shares entitled to vote thereon or (3) the transaction is fair as to the company as of the time it is authorized, approved or ratified. Under Delaware law, such interested director could be held liable for a transaction in which such director derived an improper personal benefit.

Voting Rights and Quorum Requirements

Under Bermuda law, the voting rights of our shareholders are regulated by our bye-laws and, in certain circumstances, the Companies Act. Under our bye-laws, at any general meeting, two or more persons present in person at the start of the meeting and representing in person or by proxy shareholders holding shares carrying more than 25% of the votes of all shares entitled to vote on the resolution shall constitute a quorum for the transaction of business. Generally, except as otherwise provided in the bye-laws, or the Companies Act, any action or resolution requiring approval of the shareholders may be passed by a simple majority of votes cast except for the election of directors which requires only a plurality of the votes cast.

Any individual who is a shareholder of our company and who is present at a meeting may vote in person, as may any corporate shareholder that is represented by a duly authorized representative at a meeting of shareholders. Our bye-laws also permit attendance at general meetings by proxy, provided the instrument appointing the proxy is in the form specified in the bye-laws or such other form as the board may determine. Under our bye-laws, each holder of common shares is entitled to one vote per common share held.

Under Delaware law, unless otherwise provided in a company’s certificate of incorporation, each stockholder is entitled to one vote for each share of stock held by the stockholder. Delaware law provides that unless otherwise provided in a company’s certificate of incorporation or bye-laws, a majority of the shares entitled to vote, present in person or represented by proxy, constitutes a quorum at a meeting of stockholders. In matters other than the election of directors, with the exception of special voting requirements related to extraordinary transactions, and unless otherwise provided in a company’s certificate of incorporation or bye-laws, the affirmative vote of a majority of shares present in person or represented by proxy at the meeting entitled to vote is required for stockholder action, and the affirmative vote of a plurality of shares is required for the election of directors.

Dividends

Pursuant to Bermuda law, a company is restricted from declaring or paying a dividend if there are reasonable grounds for believing that: (1) the company is, or would after the payment be, unable to pay its liabilities as they become due or (2) that the realizable value of its assets would thereby be less than its liabilities. Under our bye-laws, each common share is entitled to dividends if, as and when dividends are declared by our board of directors, subject to any preferred dividend right of the holders of any preference shares.

Under Delaware law, subject to any restrictions contained in the company’s certificate of incorporation, a company may pay dividends out of surplus or, if there is no surplus, out of net profits for the fiscal year in which the dividend is declared and for the preceding fiscal year. Delaware law also provides that dividends may not be paid out of net profits if, after the payment of the dividend, capital is less than the capital represented by the outstanding stock of all classes having a preference upon the distribution of assets.

Amalgamations, Mergers and Similar Arrangements

The amalgamation or merger of a Bermuda company with another company or corporation (other than certain affiliated companies) requires the amalgamation agreement to be approved by the company’s board of directors and by its shareholders. Unless the company’s bye-laws provide otherwise, the approval of 75% of the shareholders voting at such meeting is required to approve the amalgamation agreement, and the quorum for such meeting must be two persons holding or representing more than one-third of the issued shares of the company. Our bye-laws provide that a merger or an amalgamation (other than with a wholly owned subsidiary) that has been approved by the board must only be approved by a majority of the votes cast at a general meeting of the shareholders at which the quorum shall be two or more persons present in person and representing in person or by proxy shareholders holding shares carrying more than 25% of the votes of all shares entitled to vote on the resolution. Any merger or amalgamation not approved by our board must be approved by shareholders holding shares carrying not less than 66% of the votes of all shares entitled to vote on the resolution.

Under Bermuda law, in the event of an amalgamation or merger of a Bermuda company with another company or corporation, a shareholder of the Bermuda company who did not vote in favor of the amalgamation or merger and is not satisfied that fair value has been offered for such shareholder’s shares may, within one month of notice of the shareholders meeting, apply to the Supreme Court of Bermuda to appraise the fair value of those shares.

Under Delaware law, with certain exceptions, a merger, consolidation or sale of all or substantially all the assets of a corporation must be approved by the board of directors and a majority of the issued and outstanding shares entitled to vote thereon. Under Delaware law, a shareholder of a corporation participating in certain major corporate transactions may, under certain circumstances, be entitled to appraisal rights pursuant to which such shareholder may receive cash in the amount of the fair value of the shares held by such shareholder (as determined by a court) in lieu of the consideration such shareholder would otherwise receive in the transaction.

Takeovers

An acquiring party is generally able to acquire compulsorily the common shares of minority holders of a company in the following ways:

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By a procedure under the Companies Act known as a “scheme of arrangement.” A scheme of arrangement could be effected by obtaining the agreement of the company and of holders of common shares, representing in the aggregate a majority in number and at least 75% in value of the common shareholders present and voting at a court ordered meeting held to consider the scheme of arrangement. The scheme of arrangement must then be sanctioned by the Bermuda Supreme Court. If a scheme of arrangement receives all necessary agreements and sanctions, upon the filing of the court order with the Registrar of Companies in Bermuda, all holders of common shares could be compelled to sell their shares under the terms of the scheme or arrangement.

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If the acquiring party is a company by acquiring pursuant to a tender offer 90% of the shares or class of shares not already owned by, or by a nominee for, the acquiring party (the offeror), or any of its subsidiaries. If an offeror has, within four months after the making of an offer for all the shares or class of shares not owned by, or by a nominee for, the offeror, or any of its subsidiaries, obtained the approval of the holders of 90% or more of all the shares to which the offer relates, the offeror may, at any time within two months beginning with the date on which the approval was obtained, require by notice any nontendering shareholder to transfer its shares on the same terms as the original offer. In those circumstances, nontendering shareholders will be compelled to sell their shares unless the Supreme Court of Bermuda (on application made within a one-month period from the date of the offeror’s notice of its intention to acquire such shares) orders otherwise.

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Where the acquiring party or parties hold not less than 95% of the shares or a class of shares of the company, by acquiring, pursuant to a notice given to the remaining shareholders or class of shareholders, the shares of such remaining shareholders or class of shareholders. When this notice is given, the acquiring party is entitled and bound to acquire the shares of the remaining shareholders on the terms set out in the notice, unless a remaining shareholder, within one month of receiving such notice, applies to the Supreme Court of Bermuda for an appraisal of the value of their shares. This provision only applies where the acquiring party offers the same terms to all holders of shares whose shares are being acquired.

Delaware law provides that a parent corporation, by resolution of its board of directors and without any shareholder vote, may merge with any subsidiary of which it owns at least 90% of each class of its capital stock. Upon any such merger, dissenting shareholders of the subsidiary would have appraisal rights.

Shareholders’ Suits

Class actions and derivative actions are generally not available to shareholders under Bermuda law. The Bermuda courts, however, would ordinarily be expected to permit a shareholder to commence an action in the name of a company to remedy a wrong to the company where the act complained of is alleged to be beyond the corporate power of the company or illegal, or would result in the violation of the company’s memorandum of association or bye-laws. Furthermore, consideration would be given by a Bermuda court to acts that are alleged to constitute a fraud against the minority shareholders or, for instance, where an act requires the approval of a greater percentage of the company’s shareholders than that which actually approved it.

Our bye-laws contain a provision by virtue of which our shareholders waive any claim or right of action that they have, both individually and on our behalf, against any director or officer in relation to any action or failure to take action by such director or officer, except in respect of any fraud or dishonesty of such director or officer. The operation of this provision as a waiver of the right to sue for violations of federal securities laws may be unenforceable in U.S. courts.

Class actions and derivative actions generally are available to shareholders under Delaware law for, among other things, breach of fiduciary duty, corporate waste and actions not taken in accordance with applicable law. In such actions, the court generally has discretion to permit the winning party to recover attorneys’ fees incurred in connection with such action.

Indemnification of Directors and Officers

Section 98 of the Companies Act provides generally that a Bermuda company may indemnify its directors, officers and auditors against any liability which by virtue of any rule of law would otherwise be imposed on them in respect of any negligence, default, breach of duty or breach of trust, except in cases where such liability arises from fraud or dishonesty of which such director, officer or auditor may be guilty in relation to the company. Section 98 further provides that a Bermuda company may indemnify its directors, officers and auditors against any liability incurred by them in defending any proceedings, whether civil or criminal, in which judgment is awarded in their favor or in which they are acquitted or granted relief by the Supreme Court of Bermuda pursuant to section 281 of the Companies Act.

We have adopted provisions in our bye-laws that provide that we shall indemnify our officers and directors in respect of their actions and omissions, except in respect of their fraud or dishonesty. We also have entered into directors’ service agreements with our directors, pursuant to which we have agreed to indemnify them against any liability brought against them by reason of their service as directors, except in cases where such liability arises from fraud, dishonesty, bad faith, gross negligence, willful default or willful misfeasance. Our bye-laws provide that the shareholders waive all claims or rights of action that they might have, individually or in right of the company, against any of the company’s directors or officers for any act or failure to act in the performance of such director’s or officer’s duties, except in respect of any fraud or dishonesty of such director or officer. Section 98A of the Companies Act permits us to purchase and maintain insurance for the benefit of any officer or director in respect of any loss or liability attaching to him in respect of any negligence, default, breach of duty or breach of trust, whether or not we may otherwise indemnify such officer or director. We have purchased and maintain a directors’ and officers’ liability policy for such a purpose.

Under Delaware law, a corporation may indemnify a director or officer of the corporation against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred in defense of an action, suit or proceeding by reason of such position if (1) such director or officer acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation and (2) with respect to any criminal action or proceeding, such director or officer had no reasonable cause to believe his conduct was unlawful.

Inspection of Corporate Records

Members of the general public have the right to inspect our public documents available at the office of the Registrar of Companies in Bermuda and our registered office in Bermuda, which will include our memorandum of association (including its objects and powers) and certain alterations to our memorandum of association. Our shareholders have the additional right to inspect our bye-laws, minutes of general meetings and audited financial statements, which must be presented to the annual general meeting of shareholders.

The register of members of a company is also open to inspection by shareholders, and by members of the general public without charge. The register of members is required to be open for inspection for not less than two hours in any business day (subject to the ability of a company to close the register of members for not more than 30 days in a year). A company is required to maintain its share register in Bermuda but may, subject to the provisions of the Companies Act, establish a branch register outside of Bermuda. A company is required to keep at its registered office a register of directors and officers that is open for inspection for not less than two hours in any business day by members of the public without charge. Bermuda law does not, however, provide a general right for shareholders to inspect or obtain copies of any other corporate records.

Delaware law permits any shareholder to inspect or obtain copies of a corporation’s shareholder list and its other books and records for any purpose reasonably related to such person’s interest as a shareholder.

Shareholder Proposals

Under Bermuda law, shareholders may, as set forth below and at their own expense (unless the company otherwise resolves), require the company to: (1) give notice to all shareholders entitled to receive notice of the annual general meeting of any resolution that the shareholders may properly move at the next annual general meeting; and/or (2) circulate to all shareholders entitled to receive notice of any general meeting a statement in respect of any matter referred to in the proposed resolution or any business to be conducted at such general meeting. The number of shareholders necessary for such a requisition is either: (1) any number of shareholders representing not less than 5% of the total voting rights of all shareholders entitled to vote at the meeting to which the requisition relates; or (2) not less than 100 shareholders.

Delaware law does not include a provision restricting the manner in which nominations for directors may be made by shareholders or the manner in which business may be brought before a meeting although restrictions may be included in a Delaware company’s certificate of incorporation or bye-laws.

Calling of Special Shareholders’ Meetings

Under our bye-laws, a special general meeting may be called by the chairman of the board or the board of directors. Bermuda law also provides that a special general meeting must be called upon the request of shareholders holding not less than 10% of the paid-up capital of the company carrying the right to vote at general meetings.

Delaware law permits the board of directors or any person who is authorized under a corporation’s certificate of incorporation or bye-laws to call a special meeting of shareholders.

Amendment of Organizational Documents

Bermuda law provides that the memorandum of association of a company may be amended by a resolution passed at a general meeting of shareholders of which due notice has been given. Certain amendments to the memorandum of association may require approval of the Bermuda Minister of Finance, who may grant or withhold approval at his or her discretion.

Under Bermuda law, the holders of an aggregate of not less than 20% in par value of a company’s issued share capital have the right to apply to the Bermuda courts for an annulment of any amendment of the memorandum of association adopted by shareholders at any general meeting, other than an amendment which alters or reduces a company’s share capital as provided in the Companies Act. Where such an application is made, the amendment becomes effective only to the extent that it is confirmed by the Bermuda court. An application for an annulment of an amendment of the memorandum of association must be made within 21 days after the date on which the resolution altering the company’s memorandum of association is passed and may be made on behalf of persons entitled to make the application by one or more of their designees as such holders may appoint in writing for such purpose. No application may be made by the shareholders voting in favor of the amendment.

Under Delaware law, amendment of the certificate of incorporation, which is the equivalent of a memorandum of association, of a company must be made by a resolution of the board of directors setting forth the amendment, declaring its advisability, and either calling a special meeting of the shareholders entitled to vote or directing that the proposed amendment be considered at the next annual meeting of the shareholders. Delaware law requires that, unless a different percentage is provided for in the certificate of incorporation, a majority of the voting power of the corporation is required to approve the amendment of the certificate of incorporation at the shareholders meeting. If the amendment would alter the number of authorized shares or par value or otherwise adversely affect the rights or preference of any class of a company’s stock, the holders of the issued and outstanding shares of such affected class, regardless of whether such holders are entitled to vote by the certificate of incorporation, are entitled to vote as a class upon the proposed amendment. However, the number of authorized shares of any class may be increased or decreased, to the extent not falling below the number of shares then issued and outstanding, by the affirmative vote of the holders of a majority of the stock entitled to vote, if so provided in the company’s certificate of incorporation that was authorized by the affirmative vote of the holders of a majority of such class or classes of stock.

Amendment of Bye-laws

Our bye-laws provide that the bye-laws may only be rescinded, altered or amended upon approval by a resolution of our board of directors and by a resolution of our shareholders, adopted by the affirmative votes of at least a majority of all shares entitled to vote on the resolution. Our bye-laws provide that, notwithstanding the foregoing, at any time that the Manager holds any of our manager shares, rescission, alteration or amendment of the bye-law relating to our ability to terminate the Manager’s appointment under our management agreement also requires the approval of the holder of our manager shares.

Under Delaware law, unless the certificate of incorporation or bye-laws provide for a different vote, holders of a majority of the voting power of a corporation and, if so provided in the certificate of incorporation, the directors of the corporation have the power to adopt, amend and repeal the bye-laws of a corporation. Those bye-laws dealing with the election of directors, classes of directors and the term of office of directors may only be rescinded, altered or amended upon approval by a resolution of the directors and by a resolution of shareholders carrying not less than 66% of all shares entitled to vote on the resolution.

DESCRIPTION OF AMERICAN DEPOSITARY SHARES

American Depositary Receipts

All of our issued and outstanding common shares are held by the depositary, Deutsche Bank Trust Company Americas (the “Depositary”) in the form of ADSs. The Depositary is a state chartered New York banking corporation and a member of the United States Federal Reserve System, subject to regulation and supervision principally by the United States Federal Reserve Board and the New York State Banking Department. The Depositary was incorporated as a limited liability bank on March 5, 1903 in the State of New York. The registered office of the Depositary is located at 60 Wall Street, New York, NY 10005 and the registered number is BR1026. The principal executive office of the Depositary is located at 60 Wall Street, New York NY 10005.

Each ADS represents an ownership interest in one common share which we deposit with the custodian under the deposit agreement among ourselves, the Depositary, and ADS holders. Your ADSs are evidenced by what are known as American Depositary Receipts, or ADRs, in the same way a share is evidenced by a share certificate. Your rights as a holder of ADSs is governed by the deposit agreement and our bye-laws.

The following is a summary of the material terms of the deposit agreement. Because it is a summary, it does not contain all the information that may be important to you. For more complete information, you should read the entire deposit agreement and the form of ADR which contains the terms of your ADSs. You can read a copy of the deposit agreement which is filed with the SEC as an exhibit to our registration statement on Form F-6, as filed with the SEC on September 21, 2007, as may be subsequently amended, from the SEC’s website at www.sec.gov. Copies of the deposit agreement and the form of ADR are also available for inspection at the corporate trust office of the Depositary. The Depositary keeps books at its corporate trust office for the registration of ADRs and transfer of ADRs which, at all reasonable times, shall be open for inspection by ADS holders, provided that inspection shall not be for the purposes of communicating with ADS holders in the interest of a business or object other than our business or a matter related to the deposit agreement or the ADSs.

Holding the ADSs

Unless otherwise agreed among us and the Depositary in accordance with the terms of the deposit agreement, the ADSs are held electronically in book-entry form either directly (by having an ADR registered in your name) or indirectly through your broker or other financial institution. If you hold ADSs directly, you are an ADR holder. This description assumes you hold your ADSs directly. If you hold the ADSs indirectly, you must rely on the procedures of your broker or other financial institution to assert the rights of ADR holders described in this section. You should consult with your broker or financial institution to find out what those procedures are.

As an ADR holder, you are not treated as one of our shareholders and you do not have shareholder rights. Bermuda law governs shareholder rights. The Depositary is the holder of the common shares underlying your ADSs, which are registered in its name with Conyers Corporate Services (Bermuda) Limited, the registrar and transfer agent for our common shares. As a holder of ADRs, you have ADR holder rights. A deposit agreement among us, the Depositary and you, as an ADR holder, and the beneficial owners of ADRs sets out ADR holder rights, representations and warranties as well as the rights and obligations of the Depositary. New York law governs the deposit agreement and the ADRs.

Fees and Expenses

Except as described below, we pay all fees, charges and expenses of the Depositary and any agent of the Depositary pursuant to agreements from time to time between us and the Depositary, except that if you elect to withdraw the common shares underlying your ADRs from the Depositary you will be required to pay the Depositary a fee of up to $5.00 per 100 ADSs surrendered or any portion thereof, together with expenses incurred by the Depositary and any taxes or charges, such as stamp taxes or stock transfer taxes or fees, in connection with the withdrawal. We will not receive any portion of the fee payable to the Depositary upon a withdrawal of shares from the Depositary. The Depositary will not make any payments to us, and we will not receive any portion of any fees collected by the Depositary.

Except as specified above in connection with a cancellation of ADSs and withdrawal of common shares from the Depositary, we are required to pay any taxes and other governmental charges incurred by the Depositary or the custodian on any ADR or common share underlying an ADR, including any applicable interest and penalties thereon, any stock transfer or other taxes and other governmental charges in any applicable jurisdiction.

Dividends and Other Distributions

The Depositary has agreed to pay to you the cash dividends or other distributions it or the custodian receives on common shares or other deposited securities, less any fees described below under “–Withholding Taxes, Duties and Other Governmental Charges.” You will receive these distributions in proportion to the number of common shares your ADSs represent as of the record date set by the Depositary with respect to the ADSs.

•

Withholding Taxes, Duties and Other Governmental Charges. Before making a distribution, the Depositary will deduct any withholding taxes, duties or other governmental charges that must be paid. Dividends on our shares are subject to deduction of Irish withholding taxes, unless an exemption to withholding is available. U.S. holders of ADSs (including U.S. citizens or residents) are entitled to claim a refund of Irish withholding taxes on dividends. Unless a U.S. holder of ADSs otherwise specifies, a customary fee of $0.005 per ADS will be deducted from each dividend paid to such holder so that such dividend may be paid gross of Irish withholding taxes. Additionally, dividend payments made within the United States with respect to the shares may be subject to possible U.S. backup withholding. Backup withholding will not apply, however, to a holder who furnishes a correct taxpayer identification number and makes any other required certification or who is otherwise exempt from backup withholding.

•

Shares. The Depositary may distribute additional ADSs representing any common shares we distribute as a dividend or free distribution to the extent permissible by law. If the Depositary does not distribute additional ADRs, the outstanding ADSs will also represent the new common shares.

•

Elective Distributions in Cash or Shares. If we offer holders of our common shares the option to receive dividends in either cash or common shares, the Depositary will, after consultation with us and to the extent permissible by law and reasonably practicable, offer holders of ADSs the option to receive dividends in either cash or ADSs to the extent permissible under applicable law and in accordance with the deposit agreement.

•

Rights to Receive Additional Shares. If we offer holders of our common shares any rights to subscribe for additional common shares or any other rights, the Depositary, after consultation with us and to the extent permissible by law and reasonably practicable, will make these rights available to you as a holder of ADSs. If the Depositary makes rights available to you, it will exercise the rights and purchase the common shares on your behalf subject to your payment of applicable fees, taxes, charges and expenses. The Depositary will then deposit the common shares and issue ADSs to you. It will only exercise rights if you pay it the exercise price and any taxes and other governmental charges the rights require you to pay. U.S. securities laws or Bermuda law may restrict the sale, deposit, cancellation, and transfer of the ADSs issued after exercise of rights. Our intent is not to offer holders any rights to subscribe for additional common shares unless the holders of our ADSs would thereby be offered rights to receive ADSs in an offering registered under U.S. securities laws.

•

Other Distributions. Subject to receipt of timely notice from us with the request to make any such distribution available to you, and provided the Depositary has determined that such distribution is lawful, practicable and feasible and in accordance with the terms of the deposit agreement, the Depositary will send to you anything else we distribute on deposited securities by any means it deems practical in proportion to the number of ADSs held by you, net of any taxes and other governmental charges withheld.

The Depositary is not responsible if it decides that it is unlawful or impractical to make a distribution available to any ADR holders. We have no obligation to register ADSs, common shares, rights or other securities under the Securities Act. We also have no obligation to take any other action to permit the distribution of ADRs, common shares, rights or anything else to ADR holders. This means that you may not receive the distributions we make on our shares or any value for them if it is illegal or impractical for us to make them available to you.

Deposit and Withdrawal

The Depositary delivers ADSs upon deposit of common shares with the custodian. The custodian holds all deposited common shares, including those being deposited by us in connection with the offering to which this prospectus relates, for the account of the Depositary. You thus have no direct ownership interest in the common shares and only have the rights as are set out in the deposit agreement. The custodian also holds any additional securities, property and cash received on, or in substitution for, the deposited common shares. The deposited common shares and any such additional items are all referred to collectively as “deposited securities.”

Upon each deposit of common shares, receipt of related delivery documentation and compliance with the other provisions of the deposit agreement, the Depositary issues an ADR or ADRs in the name of the person entitled thereto evidencing the number of ADSs to which that person is entitled. Alternatively, at your request, risk and expense, the Depositary in its discretion will deliver certificated ADRs at the Depositary’s principal New York office or any other location that it may designate as its transfer office.

You may surrender your ADRs at the Depositary’s office or through instruction provided to your broker. Upon your payment of its fees and charges of, and expenses incurred by, it and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, the Depositary will deliver the common shares and any other deposited securities underlying the ADR to you or a person you designate at the office of the custodian. Or, at your request, risk and expense, the Depositary will deliver the deposited securities at its principal New York office or any other location that it may designate as its transfer office, if feasible.

You have the right to cancel your ADSs and withdraw the underlying common shares at any time subject only to:

•

temporary delays caused by closing of our or the Depositary’s transfer books, or the deposit of common shares in connection with voting at a shareholders’ meeting, or the payment of dividends;

•

the surrender of ADRs evidencing a number of ADSs representing other than a whole number of common shares;

•

the payment of fees, charges, taxes and other governmental charges; or

•

where deemed necessary or advisable by the Depositary or us in good faith due to any requirement of any U.S. or foreign laws, government, governmental body or commission, any securities exchange on which the ADSs or common shares are listed or governmental regulations relating to the ADSs or the withdrawal of the underlying common shares.

U.S. securities laws provide that this right of withdrawal may not be limited by any other provision of the deposit agreement. However, we do not intend to list our common shares for trading on any exchange. Therefore, it may be more difficult to dispose of our common shares than it will be to dispose of our ADSs.

Transmission of Notices to Shareholders

We will promptly transmit to the Depositary those communications that we make generally available to our shareholders together with annual and other reports prepared in accordance with applicable requirements of U.S. securities laws. Upon our request and at our expense, subject to the distribution of any such communications being lawful and not in contravention of any regulatory restrictions or requirements if so distributed and made available to holders, the Depositary will arrange for the timely mailing of copies of such communications to all ADS holders and will make a copy of such communications available for inspection at the Depositary’s Corporate Trust Office, the office of the custodian or any other designated transfer office of the Depositary.

Voting Rights

As soon as practicable upon receipt of timely notice of any meeting at which the holders of our shares are entitled to vote, or of solicitation of consents or proxies from holders of our shares, the Depositary will fix a record date in respect of such meeting or solicitation of consent or proxy. The Depositary will, if requested by us in writing in a timely manner, mail by regular, ordinary mail delivery (or by electronic mail or as otherwise may be agreed between us and the Depositary from time to time) or otherwise distribute to holders of ADSs as of the record date: (a) such information as is contained in such notice of meeting (or solicitation of consent or proxy) received by the Depositary from us, (b) a statement that holders as of the record date will be entitled, insofar as practicable and permitted under applicable law, the terms of the deposit agreement, the terms and conditions of our common shares and of our bye-laws (and subject to such other requirements as we shall notify the Depositary), to instruct the Depositary as to the exercise of the voting rights (or deemed exercise of voting rights), if any, pertaining to the amount of our common shares represented by their respective ADSs, and (c) a statement as to the manner in which such instructions may be given or may be deemed to have been given as described below if no validly-completed instructions are received by the Depositary from a holder of ADSs by the ADS voting cut-off date set by the Depositary for such purpose. Upon the written request of a holder as of such record date, received on or before the ADS voting cut-off date, the Depositary will endeavor, insofar as practicable, to vote or cause to be voted the amount of our common shares represented by the ADSs in accordance with the instructions set forth in such request.

To the extent no such instructions are received by the Depositary on or before the ADS voting cut-off date from holders of a sufficient number of shares so as to enable the Company to meet its quorum requirements with respect to any such meeting of shareholders, the Depositary will, upon our written request and at all times subject to applicable law, the terms of the deposit agreement, the terms and conditions of our common shares and our bye-laws, deem such holder to: (A) have instructed the Depositary to take such action as is necessary to cause the number of underlying shares for which no voting instructions have been received from holders of ADSs so as to meet applicable quorum requirements (currently 25% of our common shares) to be counted for the purposes of satisfying applicable quorum requirements; and (B) have given a power of attorney to the Depositary or the custodian, as its nominee, to cause such equal number of common shares so counted under (A) above being counted for the purposes of establishing a quorum, with respect to any resolution proposed by the Board of Directors of the Company within the agenda set for such meeting, to be voted at any such meeting in proportion to the voting instructions duly-received by the Depositary from holders of ADSs as of the record date by the ADS voting cut-off date; provided, however that, except to the extent we have provided the Depositary with at least 30 days’ written notice of any such meeting, the common shares shall not be so counted and shall not be so voted (proportionately to the voting instructions received by the Depositary from holders of ADSs as of the record date by the ADS voting cut-off date) with respect to any matter as to which the Depositary informs us that the Depositary reasonably believes that with respect to any such resolution: (i) substantial opposition exists or (ii) it materially affects the rights of holders of common shares. For the purposes of this provision of the deposit agreement, by way of example and not limitation, it is agreed that routine matters, such as appointing auditors and directors (except where a competing director or slate of directors is proposed), and resolutions to approve the public offering or private placement of securities, would not materially affect the rights of holders of common shares.

There can be no assurance that holders generally or any holder in particular will receive the notice described above with sufficient time to enable such holder to return voting instructions to the Depositary by the ADS voting cut-off date. In the deposit agreement, we have agreed that we will endeavor to provide at least 30 days’ prior written notice to the Depositary which will enable the timely notification of holders as to limitations on the ability of the Depositary to vote a particular ADS according to the voting instructions received in regard to such ADS. Common shares which have been withdrawn from the Depositary facility and transferred on our register of members to a person other than the Depositary or its nominee may be voted by the holders thereof in accordance with applicable law and our bye-laws. However, holders or beneficial owners of ADSs may not receive sufficient advance notice of shareholder meetings to enable them to withdraw the common shares and vote at such meetings.

Payment of Taxes

You will be responsible for any taxes or other governmental charges payable on your ADSs or on the deposited securities underlying your ADRs. The Depositary may refuse to issue ADSs, deliver ADRs, register the transfer, split-up or combination of ADRs, or allow you to withdraw the deposited securities underlying your ADSs until such payment is made including any applicable interest and penalty thereon. We, the custodian or the Depositary may withhold or deduct the amounts of taxes owed from any distributions to you or may sell deposited securities, by public or private sale, to pay any taxes and any applicable interest and penalties owed. You will remain liable if the proceeds of the sale are not enough to pay the taxes. If the Depositary sells deposited securities, it will, if appropriate, reduce the number of ADSs to reflect the sale and pay to you any proceeds, or send to you any property remaining after it has paid the taxes.

Unless a U.S. holder of ADSs otherwise specifies, a customary fee of $0.005 per ADS will be deducted from each dividend paid to such holder so that such dividend may be paid gross of Irish withholding taxes.

Reclassifications, Recapitalizations and Mergers

If we take actions that affect the deposited securities, including (1) any change in par value, split-up, cancellation, consolidation or other reclassification of deposited securities to the extent permitted by any applicable law, (2) any distribution on the common shares that is not distributed to you and (3) any recapitalization, reorganization, merger, consolidation, liquidation or sale of our assets affecting us or to which we are a party resulting in a distribution of cash or securities to our shareholders, then the cash, common shares or other securities received by the Depositary in connection therewith will become deposited securities and be subject to the deposit agreement and any applicable law, evidence the right to receive such additional deposited securities, and the Depositary may choose to:

•

distribute additional ADSs;

•

call for surrender of outstanding ADSs to be exchanged for new ADSs;

•

distribute cash, securities or other property it has received in connection with such actions;

•

sell any securities or property received at public or private sale on an averaged or other practicable basis without regard to any distinctions among holders and distribute the net proceeds as cash; or

•

treat the cash, securities or other property it receives as part of the deposited securities, and each ADS will then represent a proportionate interest in that property.

Amendment and Termination

We may agree with the Depositary to amend the deposit agreement and the ADSs without your consent for any reason deemed necessary or desirable. You will be given at least 30 days’ notice of any amendment that imposes or increases any fees or charges, except for taxes, governmental charges, delivery expenses or other charges specifically payable by ADS holders under the deposit agreement, or which otherwise materially prejudices any substantial existing right of holders or beneficial owners of ADSs. If an ADS holder continues to hold ADSs after being so notified of these changes, that ADS holder is deemed to agree to that amendment and be bound by the ADRs and the agreement as amended. An amendment can become effective before notice is given if necessary to ensure compliance with a new law, rule or regulation.

At any time we may instruct the Depositary to terminate the deposit agreement, in which case the Depositary will give notice to you at least 30 days prior to termination. The Depositary may also terminate the deposit agreement if it has told us that it would like to resign or we have removed the Depositary and we have not appointed a new Depositary bank within 90 days, in such instances, the Depositary will give notice to you at least 30 days prior to termination. After termination, the Depositary’s only responsibility will be to deliver deposited securities to ADS holders who surrender their ADSs upon payment of any fees, charges, taxes or other governmental charges, and to hold or sell distributions received on deposited securities. After the expiration of six months from the termination date, the Depositary may sell the deposited securities which remain and hold the net proceeds of such sales, uninvested and without liability for interest, for the pro rata benefit of ADS holders who have not yet surrendered their ADSs. After selling the deposited securities, the Depositary has no obligations except to account for those net proceeds and other cash. Upon termination of the deposit agreement, we will be discharged from all obligations except for our obligations to the Depositary.

We intend to maintain a Depositary arrangement for so long as it facilitates U.S. holders in benefiting from an exemption to Irish withholding taxes on dividends on our common shares.

Limitations on Obligations and Liability

The deposit agreement expressly limits our and the Depositary’s obligations and liability.

We and the Depositary:

•

are only obligated to take the actions specifically set forth in the deposit agreement without gross negligence or bad faith;

•

are not liable if either of us by law or circumstances beyond our control is prevented from, or delayed in, performing any obligation under the agreement, including, without limitation, requirements of any present or future law, regulation, governmental or regulatory authority or stock exchange of any applicable jurisdiction, any present or future provision of our memorandum of association and bye-laws, on account of possible civil or criminal penalties or restraint, any provisions of or governing the deposited securities, any act of God, war or other circumstances beyond each of our control as set forth in the deposit agreement;

•

are not liable if either of us exercises or fails to exercise the discretion permitted under the deposit agreement, the provisions of or governing the deposited securities or our memorandum of association and bye-laws;

•

are not liable for any action/inaction on the advice or information of legal counsel, accountants, any person presenting common shares for deposit, holders and beneficial owners (or authorized representatives) of ADRs, or any person believed in good faith to be competent to give such advice or information;

•

are not liable for the inability of any holder to benefit from any distribution, offering, right or other benefit if made in accordance with the provisions of the deposit agreement;

•

have no obligation to become involved in a lawsuit or other proceeding related to any deposited securities or the ADSs or the deposit agreement on your behalf or on behalf of any other party;

•

may rely upon any documents we believe in good faith to be genuine and to have been signed or presented by the proper party; and

•

shall not incur any liability for any indirect, special, punitive or consequential damages for any breach of the terms of the deposit agreement.

The Depositary and its agents shall not incur any liability under the deposit agreement for the failure to carry out any instructions to vote, the manner in which any vote is cast or the effect of any vote or failure to determine that any distribution or action may be lawful or reasonably practicable or allowing any rights to lapse in accordance with the provisions of the deposit agreement, the failure or timeliness of any notice from us, the content of any information submitted to it by us for distribution to you, any investment risk associated with the acquisition of an interest in the deposited securities, the validity or worth of the deposited securities or for any tax consequences that may result from ownership of ADSs, common shares or deposited securities for the creditworthiness of any third party and for any indirect, special, punitive or consequential damage.

We have agreed to indemnify the Depositary under certain circumstances. However, the deposit agreement does not limit our liability under federal securities laws. The Depositary may own and deal in any class of our securities and in the ADSs.

Requirements for Depositary Actions

Before the Depositary issues, delivers or registers a transfer of an ADS, makes a distribution on an ADS, or permits withdrawal of common shares or other property, the Depositary may require:

•

payment of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties for the transfer of any common shares or other deposited securities;

•

production of satisfactory proof of the identity and genuineness of any signature or other information it deems necessary; and

•

compliance with regulations it may establish, from time to time, consistent with the deposit agreement, including presentation of transfer documents.

The Depositary also may suspend the issuance of ADSs, the deposit of common shares, the registration, transfer, split-up or combination of ADSs or the withdrawal of deposited securities, unless the deposit agreement provides otherwise, if the register for ADSs is closed or if we or the Depositary decide any such action is necessary or advisable.

Deutsche Bank Trust Company Americas keeps books for the registration and transfer of ADRs at its offices. You may reasonably inspect such books, except if you have a purpose other than our business or a matter related to the deposit agreement or the ADRs.

Disclosure of Interests

By purchasing ADSs, you agree to comply with our memorandum of association and bye-laws and the laws of Bermuda, the United States of America and any other relevant jurisdiction regarding any disclosure requirements regarding ownership of common shares, all as if the ADSs were, for this purpose, the common shares they represent.

Exhibit 10.25

Letter Agreement

NordLB / Fly Leasing – Loan Agreements

[ ] Airbus and Boeing Aircraft

Aphrodite Aviation Limited (the MSN [ ] Borrower)

Artemis Aviation Limited (the MSN [ ] Borrower)

Clementine Aviation Limited (the MSN [ ] Borrower)

Panda Aviation Limited (the MSN [ ] Borrower)

Victoria Peak Aviation Limited (the MSN [ ] Borrower)

Hobart Aviation Holdings Limited (the Shareholder)

Norddeutsche Landesbank Girozentrale, as lender in relation to the financing of the Aircraft (the Lender)

Norddeutsche Landesbank Girozentrale, as facility agent in relation to the financing of the Aircraft (the Facility Agent)

Norddeutsche Landesbank Girozentrale, as security agent and trustee in relation to the financing of the Aircraft (the Security Trustee)

[ ], 2019

Dear Sirs

[ ] Airbus and Boeing Aircraft

Background

1	We refer to:

(a)

the loan agreement relating to MSN [ ] dated 6 February 2012 between the MSN [ ] Borrower, the Shareholder, the Lender, the Facility Agent and the Security Trustee (as amended, supplemented or varied from time to time (including without limitation pursuant to the letter agreement dated 13 November 2018 between, inter alios, the MSN [ ] Borrower and the Finance Parties), the MSN [ ] Loan Agreement);

(b)

(c)

(d)

(e)

(together, the Loan Agreements; each, a Loan Agreement).

2	In this letter agreement:

(a)

Aircraft means, together, MSN [ ], MSN [ ], MSN [ ], MSN [ ] and MSN [ ];

(b)

Collateral Agreement means the collateral agreement relating to, inter alia, the Aircraft dated 6 February 2012 between, inter alios, the Parties (as amended pursuant to the related letter agreement dated 14 November 2018);

(c)

Collateral Agreement Amendment Letter means the letter agreement relating to the Collateral Agreement dated on or about the date hereof between, inter alios, the Parties,

(d)

Effective Time means the time at which the Facility Agent delivers the Effective Time Notice to the Parties confirming that each of the conditions specified in paragraph 8 has been satisfied (or waived or postponed) in accordance with the provisions of paragraphs 8 to 11;

(e)

Effective Time Notice means a notice from the Facility Agent substantially in the form of the Exhibit;

(f)

Final Repayment Date has the meaning given to that term in each Relevant Loan Agreement;

(g)

Finance Parties means, together, the Lender, the Facility Agent and the Security Trustee;

(h)

MSN [ ] means the [ ] aircraft with manufacturer’s serial number [ ];

(i)

MSN [ ] Advance has the meaning given to the term “Advance” in the MSN [ ] Loan Agreement;

(j)

MSN [ ] Loan Amount means the outstanding principal amount of the MSN [ ] Advance (being the balance remaining follow the application of, inter alia, the Net Sale Proceeds from the sale of MSN [ ] to partially prepay the MSN [ ] Advance) as at the Effective Time (immediately prior to the MSN [ ] Loan Transfer);

(k)

MSN [ ] Loan Transfer means the transfer of the MSN [ ] Advance pursuant to paragraphs 4.1 to 4.3 inclusive;

(l)

MSN [ ] means the [ ] aircraft with manufacturer’s serial number [ ];

(m)

MSN [ ] Advance has the meaning given to the term “Advance” in the MSN [ ] Loan Agreement;

(n)

(o)

MSN [ ] Loan Transfer means the transfer of the MSN [ ] Advance pursuant to paragraphs 5.1 to 5.3 inclusive;

(p)

MSN [ ] means the [ ] aircraft with manufacturer’s serial number [ ];

(q)

MSN [ ] Advance has the meaning given to the term “Advance” in the MSN [ ] Loan Agreement;

(r)

MSN [ ] means the [ ] aircraft with manufacturer’s serial number [ ];

(s)

MSN [ ] Advance has the meaning given to the term “Advance” in the MSN [ ] Loan Agreement;

(t)

MSN [ ] means the [ ] aircraft with manufacturer’s serial number [ ];

(u)

MSN [ ] Advance has the meaning given to the term “Advance” in the MSN [ ] Loan Agreement;

(v)

Obligors means, together, the MSN [ ] Borrower, the MSN [ ] Borrower, the MSN [ ] Borrower, the MSN [ ] Borrower, the MSN [ ] Borrower and the Shareholder;

(w)

Parties means, together, the parties to this letter agreement;

(x)

Relevant Advances means, together, the MSN [ ] Advance, the MSN [ ] Advance and the MSN [ ] Advance;

(y)

Relevant Aircraft means, together, MSN [ ], MSN [ ] and MSN [ ];

(z)

Relevant Aircraft Mortgages has the meaning given to the term “Aircraft Mortgages” in each Relevant Loan Agreement;

(aa)

Relevant Loan Agreements means, together, the MSN [ ] Loan Agreement, the MSN [ ] Loan Agreement and the MSN [ ] Loan Agreement;

(bb)

Relevant Obligors means, together, the MSN [ ] Borrower, the MSN [ ] Borrower, the MSN [ ] Borrower and the Shareholder;

(cc)

Relevant Security Documents has the meaning given to the term “Security Documents” in each Relevant Loan Agreement;

(dd)

Representatives means, together, the Facility Agent and the Security Trustee;

(ee)

Secured Obligations has the meaning given to that term in each Relevant Loan Agreement;

(ff)

Transaction Documents has the meaning given to that term in each Relevant Loan Agreement;

(gg)

any reference to a paragraph or an Exhibit means a paragraph of or exhibit to, respectively, this letter agreement; and

(hh)

words importing the plural shall include the singular and vice versa.

3	The Parties have agreed to enter into this letter agreement in connection with:

(a)

following the sale of MSN [ ], the transfer of the MSN [ ] Advance to the MSN [ ] Borrower, the related termination of the MSN [ ] Loan Agreement and the related increase in the outstanding principal amount of the MSN [ ] Advance;

(b)

(c)

the extension of the Final Repayment Date for each Relevant Advance from 14 January 2020 to 14 May 2021.

4	MSN [ ] Loan Transfer

4.1	With effect from the Effective Time, the MSN [ ] Borrower hereby:

(a)

assigns absolutely to the MSN [ ] Borrower all of its right, title and interest in and to the MSN [ ] Loan Agreement;

(b)

consents to the assumption of obligations pursuant to paragraph 4.2(b); and

(c)

releases each Finance Party from further performance under the MSN [ ] Loan Agreement.

4.2	With effect from the Effective Time, the MSN [ ] Borrower hereby:

(a)

accepts the assignment of rights pursuant to paragraph 4.1(a); and

(b)

agrees to assume and perform all of the obligations of the MSN [ ] Borrower under the MSN [ ] Loan Agreement and to be bound by the terms of the MSN [ ] Loan Agreement instead of the MSN [ ] Borrower.

4.3	With effect from the Effective Time, each Finance Party hereby:

(a)

consents to the assignment of rights pursuant to paragraph 4.1(a) and the assumption of obligations pursuant to paragraph 4.2(b);

(b)

agrees that all rights of the MSN [ ] Borrower under the MSN [ ] Loan Agreement are vested in (and are exercisable by) the MSN [ ] Borrower (to the exclusion of the MSN [ ] Borrower); and

(c)

releases the MSN [ ] Borrower from further performance under the MSN [ ] Loan Agreement.

4.4	With effect from the Effective Time (immediately following the MSN [ ] Loan Transfer):

(a)

each Finance Party hereby releases the MSN [ ] Borrower (as transferee of the MSN [ ] Borrower) and the Shareholder from performance under the MSN [ ] Loan Agreement (as transferred pursuant to the preceding provisions of this paragraph 4);

(b)

each Party hereby agrees that the MSN [ ] Loan Agreement, and all of the rights and obligations of the parties thereto, shall automatically and without further act terminate (in each case except to the extent relating to any provisions which are expressly stated in the MSN [ ] Loan Agreement to survive its termination); and

(c)

in consideration of the foregoing, each Party hereby agrees that the outstanding principal amount of the MSN [ ] Advance will be increased by an amount equal to the MSN [ ] Loan Amount for all purposes of the MSN [ ] Loan Agreement and the other Transaction Documents.

5	MSN [ ] Loan Transfer

5.1	With effect from the Effective Time, the MSN [ ] Borrower hereby:

(a)

assigns absolutely to the MSN [ ] Borrower all of its right, title and interest in and to the MSN [ ] Loan Agreement;

(b)

consents to the assumption of obligations pursuant to paragraph 5.2(b); and

(c)

releases each Finance Party from further performance under the MSN [ ] Loan Agreement.

5.2	With effect from the Effective Time, the MSN [ ] Borrower hereby:

(a)

accepts the assignment of rights pursuant to paragraph 5.1(a); and

(b)

5.3	With effect from the Effective Time, each Finance Party hereby:

(a)

consents to the assignment of rights pursuant to paragraph 5.1(a) and the assumption of obligations pursuant to paragraph 5.2(b);

(b)

agrees that all rights of the MSN [ ] Borrower under the MSN [ ] Loan Agreement are vested in (and are exercisable by) the MSN [ ] Borrower (to the exclusion of the MSN [ ] Borrower); and

(c)

releases the MSN [ ] Borrower from further performance under the MSN [ ] Loan Agreement.

5.4	With effect from the Effective Time (immediately following the MSN [ ] Loan Transfer):

(a)

(b)

(c)

6	Relevant Advances and Relevant Aircraft

6.1	With effect from the Effective Time, each Party hereby agrees:

(a)

that the Final Repayment Date for each Relevant Advance will be extended from 14 January 2020 to 14 May 2021; and

(b)

as a result, that the definition of “Final Repayment Date” in clause 1.1 of each Relevant Loan Agreement is deleted in its entirety and replaced with the following new definition:

“Final Repayment Date means 14 May 2021 provided that if such date is not a Business Day, it shall be the next succeeding Business Day.”.

6.2	With effect from the Effective Time, each Party hereby further agrees and confirms that:

(a)

principal and interest in relation to each Relevant Advance will continue to be repaid or paid (as applicable) on a “pay as you earn” basis in accordance with the provisions of schedule 11 to each Relevant Loan Agreement (and otherwise in accordance with the provisions of each Relevant Loan Agreement); and

(b)

except as contemplated by paragraphs 4.4(c), 5.4(c) and 6.1, the economic terms applicable to each Relevant Advance will remain unaltered.

7	Security Confirmation

Each Relevant Obligor hereby:

(a)

confirms that all of the security granted in favour of the Security Trustee pursuant to the Relevant Security Documents for the Secured Obligations (as amended pursuant to this letter agreement) remains in full force and effect; and

(b)

acknowledges that the security granted by it pursuant to or in connection with the Relevant Aircraft Mortgages and each other Relevant Security Document shall remain unaffected and any reference to a Relevant Loan Agreement in the Relevant Aircraft Mortgages and each other Relevant Security Document shall be a reference to that Relevant Loan Agreement as amended by this letter agreement.

Conditions Precedent

8	The occurrence of the Effective Time shall be subject to the satisfaction (or waiver or postponement in accordance with the terms of this letter agreement) of each of the following conditions precedent (except for the items specified in paragraph 8(f)):

Amendment Agreement:

(a)

The Facility Agent shall have received a fully executed copy of this letter agreement and the Collateral Agreement Letter Agreement.

Corporate Documents:

(b)

The Facility Agent shall have received each of the following corporate documents:

(i)

a copy of a corporate certificate of each Obligor attaching:

(A)

a certified true copy of its constitutive documents;

(B)

a certified true copy of its board resolutions that authorise the execution by it of this letter agreement and the transactions contemplated thereby;

(C)

a certified true copy of the power of attorney or letter of delegation of authority relating to the execution by it of this letter agreement;

(D)

an incumbency certificate detailing the persons entitled to execute this letter agreement on its behalf; and

(E)

a list of its directors and secretary; and

(ii)

evidence that the process agent appointed by each Relevant Obligor in England in relation to this letter agreement shall have accepted such appointment.

Legal Opinions:

(c)

The Facility Agent shall have received each of the following signed legal opinions (each addressed and delivered to each Finance Party):

(i)

Irish legal opinion of McCann FitzGerald; and

(ii)

English legal opinion of Vedder Price LLP.

Sale of MSN [ ] and MSN [ ]:

(d)

The sale of each of MSN [ ] and MSN [ ] must have completed and the related Net Sale Proceeds (as defined in each of the MSN [ ] Loan Agreement and the MSN [ ] Loan Agreement) must have been paid and applied in accordance with the provisions of the Collateral Agreement.

Other:

(e)

The following further conditions precedent shall have been satisfied:

(i)

no Total Loss shall have occurred in relation to any Relevant Aircraft;

(ii)

no Event of Default shall have occurred and be continuing under any Loan Agreement;

(iii)

no Illegality Event shall have occurred and be continuing under any Loan Agreement; and

(iv)

the Facility Agent shall have received such documentation and other evidence as it shall have required (acting reasonably) in relation to each Obligor so as to comply with all applicable “know your customer” or similar identification procedures.

MSN [ ] and MSN [ ] – CAAC Mortgage Registration:

(f)

Within thirty (30) days of the date upon which the Effective Time occurs, the MSN [ ] Borrower and the MSN [ ] Borrower, as applicable, will deliver to the Security Trustee CAAC countersigned copies of the mortgage application update forms relating to MSN [ ] and MSN [ ], necessary to update the expiry date of the mortgage interests of the Security Trustee with respect to MSN [ ] and MSN [ ] with the CAAC.

9	When making any determination with respect to any condition precedent set forth in paragraph 8, the Facility Agent will act on the instructions of the Lender.

10	Each document or other written item to be delivered to the Facility Agent pursuant to paragraph 8 must be in form and substance satisfactory to the Facility Agent (acting reasonably).

If any of the conditions precedent set forth in paragraph 8 are not satisfied in accordance with the provisions of paragraph 8, the Facility Agent (acting on the instructions of the Lender) shall be entitled to waive or postpone (in whole or in part) satisfaction of any such condition upon such terms as it may think fit. Any such waiver or postponement must be made in writing.

Miscellaneous

12	Each Party hereby represents and warrants that:

(a)

this letter agreement has been duly authorised and executed by it; and

(b)

this letter agreement constitutes its legal, valid and binding obligations, enforceable against it in accordance with its terms (except to the extent that enforcement may be limited by applicable insolvency and similar laws affecting the rights of creditors generally).

13	Each of the Parties hereby agrees and confirms that this letter agreement is a “Loan Document” (and, accordingly, a “Transaction Document”) for the purposes of each Relevant Loan Agreement (as amended by this letter agreement) and the other Transaction Documents.

14	The Parties agree that, save as amended by this letter agreement, each Relevant Loan Agreement remains in full force and effect.

15	A person who is not a party to this letter agreement has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce or enjoy the benefit of any term of this letter agreement.

This letter agreement may be executed in any number of counterparts and on separate counterparts, each of which when executed shall constitute an original, and all counterparts shall together constitute one and the same instrument. Delivery of an executed counterpart signature page of this letter agreement by e-mail (pdf) or fax shall be as effective as delivery of a manually executed counterpart of this letter agreement. In relation to each counterpart, upon confirmation by or on behalf of the signatory that the signatory authorises the attachment of such counterpart signature page to the final text of this letter agreement, such counterpart signature page shall take effect together with such final text as a complete authoritative counterpart.

Governing Law and Jurisdiction

17	This letter agreement and any non-contractual obligations arising out of or in connection with it are governed by and shall be construed in accordance with English law.

18	The provisions of clauses 35.2 to 35.6 inclusive of each Relevant Loan Agreement apply mutatis mutandis to this letter agreement.

IN WITNESS WHEREOF the Parties have caused this letter agreement to be executed as a deed by the duly authorised representatives of the Parties and this letter agreement is intended to be and is hereby delivered the day and year first above written.

Execution Page 1

Letter Agreement

NordLB / Fly Leasing – Loan Agreements

[ ] Airbus and Boeing Aircraft

MSN [ ] Borrower

SIGNED AND DELIVERED AS A DEED by		)
		)
		)
as attorney for		)
APHRODITE AVIATION LIMITED		)
in the presence of:		)

Signature of Witness:
Name of Witness:
Address of Witness:

Occupation of Witness:

MSN [ ] Borrower

SIGNED AND DELIVERED AS A DEED by		)
		)
		)
as attorney for		)
ARTEMIS AVIATION LIMITED		)
in the presence of:		)

Signature of Witness:
Name of Witness:
Address of Witness:

Occupation of Witness:

Execution Page 2

Letter Agreement

NordLB / Fly Leasing – Loan Agreements

[ ] Airbus and Boeing Aircraft

MSN [ ] Borrower

SIGNED AND DELIVERED AS A DEED by		)
		)
		)
as attorney for		)
CLEMENTINE AVIATION LIMITED		)
in the presence of:		)

Signature of Witness:
Name of Witness:
Address of Witness:

Occupation of Witness:

MSN [ ] Borrower

SIGNED AND DELIVERED AS A DEED by		)
		)
		)
as attorney for		)
PANDA AVIATION LIMITED		)
in the presence of:		)

Signature of Witness:
Name of Witness:
Address of Witness:

Occupation of Witness:

Execution Page 3

Letter Agreement

NordLB / Fly Leasing – Loan Agreements

[ ] Airbus and Boeing Aircraft

MSN [ ] Borrower

SIGNED AND DELIVERED AS A DEED by		)
		)
		)
as attorney for		)
VICTORIA PEAK AVIATION LIMITED		)
in the presence of:		)

Signature of Witness:
Name of Witness:
Address of Witness:

Occupation of Witness:

Shareholder

SIGNED AND DELIVERED AS A DEED by		)
		)
		)
as attorney for		)
HOBART AVIATION HOLDINGS LIMITED		)
in the presence of:		)

Signature of Witness:
Name of Witness:
Address of Witness:

Occupation of Witness:

Execution Page 4

Letter Agreement

NordLB / Fly Leasing – Loan Agreements

[ ] Airbus and Boeing Aircraft

Lender

EXECUTED AS A DEED by	)
NORDDEUTSCHE LANDESBANK GIROZENTRALE	)
acting by:	)

Name:		Name:
Title: Authorised Signatory		Title: Authorised Signatory

Facility Agent

EXECUTED AS A DEED by	)
NORDDEUTSCHE LANDESBANK GIROZENTRALE	)
acting by:	)

Name:		Name:
Title: Authorised Signatory		Title: Authorised Signatory

Security Trustee

EXECUTED AS A DEED by	)
NORDDEUTSCHE LANDESBANK GIROZENTRALE	)
acting by:	)

Name:		Name:
Title: Authorised Signatory		Title: Authorised Signatory

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
American Depositary Shares	FLY	New York Stock Exchange
Common Shares, par value of $0.001 per share		New York Stock Exchange*

Large accelerated filer ☐	Accelerated filer ☒	Non-accelerated filer ☐
		Emerging growth company ☐

	Page

PART I

Item 1. Identity of Directors, Senior Management and Advisers — Not Applicable	3
Item 2. Offer Statistics and Expected Timetable — Not Applicable	3
Item 3. Key Information	3
Item 4. Information on the Company	28
Item 4A. Unresolved Staff Comments — Not Applicable	37
Item 5. Operating and Financial Review and Prospects	37
Item 6. Directors, Senior Management and Employees	56
Item 7. Major Shareholders and Related Party Transactions	59
Item 8. Financial Information	68
Item 9. The Offer and Listing	69
Item 10. Additional Information	69
Item 11. Quantitative and Qualitative Disclosures About Market Risk	82
Item 12. Description of Securities Other Than Equity Securities	83

PART II

Item 13. Defaults, Dividend Arrearages and Delinquencies — Not Applicable	84
Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds	84
Item 15. Controls and Procedures	84
Item 16A. Audit Committee Financial Expert	85
Item 16B. Code of Ethics	85
Item 16C. Principal Accountant Fees and Services	85
Item 16D. Exemptions from the Listing Standards for Audit Committees — Not Applicable	86
Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers	86
Item 16F. Change in Registrant’s Certifying Accountant — Not Applicable	86
Item 16G. Corporate Governance	86
Item 16H. Mine Safety Disclosure	86

PART III

Item 17. Financial Statements	F - 1
Item 18. Financial Statements	F - 2
Item 19. Exhibits	F - 41

	(Dollars in thousands, except per share data) Years ended
	2019		2018		2017		2016			2015
Statement of income data:
Operating lease revenue	$	464,399	$	399,514	$	346,894	$	313,582		$	429,691
Gain on sale of aircraft	$	97,323	$	13,398	$	3,926	$	27,195		$	28,959
Total revenues	$	575,024	$	418,299	$	353,251	$	345,039		$	462,397
Total expenses	$	328,620	$	322,650	$	339,321	$	381,428		$	434,200
Net income (loss)	$	225,877	$	85,723	$	2,598	$	(29,112	)	$	22,798
Earnings (loss) per share:
Basic	$	7.15	$	2.88	$	0.09	$	(0.88	)	$	0.52
Diluted	$	7.12	$	2.88	$	0.09	$	(0.88	)	$	0.52
Dividends declared and paid per share	$	—	$	—	$	—	$	—		$	1.00

	(Dollars in thousands) As of December 31,
	2019		2018		2017		2016		2015
Balance sheet data:
Total assets	$	3,665,159	$	4,226,472	$	3,595,615	$	3,447,009	$	3,424,480
Total liabilities	$	2,786,882	$	3,524,362	$	3,051,906	$	2,853,774	$	2,767,516
Total shareholders’ equity	$	878,277	$	702,110	$	543,709	$	593,235	$	656,964
Number of shares outstanding		30,898,410		32,650,019		27,983,352		32,256,440		35,671,400

Facility ⁽¹⁾	Principal Amount Outstanding at December 31, 2019 ⁽²⁾		Number of Aircraft Financed		Maturity Date
Nord LB Facility	$	65.3 million		3	May 2021
Fly Aladdin Acquisition Facility	$	272.3 million		15	June 2023

Lessee		Aircraft Type	Airframe Type	Date of Manufacture
1.	Aeromexico	B737-700	Narrow-body	2005
2.	Aeromexico	B737-700	Narrow-body	2005
3.	Air China	B737-800	Narrow-body	2007
4.	Air Europa	B787-8	Wide-body	2017
5.	Air India	B787-8	Wide-body	2015
6.	Air India	B787-8	Wide-body	2014
7.	Air India	B787-8	Wide-body	2014
8.	Air Moldova	A319-100	Narrow-body	2006
9.	AirAsia Berhad	A320-200	Narrow-body	2013
10.	AirAsia Berhad	A320-200	Narrow-body	2013
11.	AirAsia Berhad	A320-200	Narrow-body	2012
12.	AirAsia Berhad	A320-200	Narrow-body	2012
13.	AirAsia Berhad	A320-200	Narrow-body	2012
14.	AirAsia Berhad	A320-200	Narrow-body	2011
15.	AirAsia Berhad	A320-200	Narrow-body	2011
16.	AirAsia Berhad	A320-200	Narrow-body	2010
17.	AirAsia Berhad	A320-200	Narrow-body	2010
18.	AirAsia Berhad	A320-200	Narrow-body	2010
19.	AirAsia Berhad	A320-200	Narrow-body	2009
20.	AirAsia India	A320-200	Narrow-body	2014
21.	AirAsia India	A320-200	Narrow-body	2014
22.	Alaska Airlines	A320-200	Narrow-body	2007
23.	American Airlines	B737-800	Narrow-body	2013
24.	American Airlines	A319-100	Narrow-body	2000
25.	American Airlines	A319-100	Narrow-body	2000
26.	American Airlines	A319-100	Narrow-body	2000
27.	American Airlines	A319-100	Narrow-body	2000
28.	Chang’An Airlines	B737-800	Narrow-body	2006
29.	Condor	A321-200	Narrow-body	2015
30.	easyJet	A319-100	Narrow-body	2007
31.	Ethiopian Airlines	B777-200LRF⁽¹⁾	Wide-body	2015
32.	Ethiopian Airlines	B777-200LRF⁽¹⁾	Wide-body	2015
33.	Finnair	A320-200⁽²⁾	Narrow-body	2003
34.	flydubai	B737-800	Narrow-body	2010
35.	flydubai	B737-800	Narrow-body	2010
36.	Fly Gangwon	B737-800	Narrow-body	2012
37.	Garuda Indonesia	B737-800	Narrow-body	2010
38.	Go2Sky	B737-800	Narrow-body	2007
39.	Go2Sky	B737-800	Narrow-body	1998
40.	Icelandair	B757-200SF⁽¹⁾	Narrow-body	1990
41.	Indigo	A320-200	Narrow-body	2005
42.	Indigo	A320-200	Narrow-body	2005
43.	Indonesia AirAsia	A320-200	Narrow-body	2013
44.	Indonesia AirAsia	A320-200	Narrow-body	2012
45.	Lucky Air Airlines	B737-800	Narrow-body	2007
46.	Lucky Air Airlines	B737-800	Narrow-body	2007
47.	Malaysian Airlines	B737-800	Narrow-body	2012
48.	Malaysian Airlines	B737-800	Narrow-body	2012
49.	Malaysian Airlines	B737-800	Narrow-body	2012
50.	Malaysian Airlines	B737-800	Narrow-body	2011
51.	Malaysian Airlines	B737-800	Narrow-body	2011
52.	Malaysian Airlines	B737-800	Narrow-body	2011
53.	Malaysian Airlines	B737-800	Narrow-body	2011
54.	Nordavia Airline	B737-700	Narrow-body	2006
55.	Oman Air S.A.O.C.	B737-800	Narrow-body	2009
56.	Philippine Airlines	A321-200	Narrow-body	2014

Lessee		Engine Type	Date of Manufacture
1.	AirAsia Berhad	CFM56-5B4/3	2011
2.	AirAsia Berhad	CFM56-5B6/3	2011
3.	AirAsia Berhad	CFM56-5B4/3	2008
4.	AirAsia Berhad	CFM56-5B6/3	2008
5.	AirAsia Berhad	CFM56-5B6/P	2006
6.	AirAsia Japan	CFM56-5B6/3	2009
7.	Indonesia AirAsia	CFM56-5B6/3	2015

Aircraft Manufacturer	Aircraft Type		Number of Aircraft
Airbus		A319-100		6
		A320-200⁽¹⁾		24
		A321-200		3
		A321neo		1
		A330-200		1
		A330-300		2
		Total		37
Boeing		B737-700		3
		B737 MAX 8		2
		B737-800		34
		B757-200SF		1
		B777-200LRF		2
		B787-8		4
		Total		46
Total				83

Airframe Type	Number of Aircraft
Narrow-body^{(1) (2)}		74
Wide-body⁽³⁾		9
Total		83

	Years ended
	2019					2018				2017
Europe:
Spain	$	17,475	4	%		$	17,267	4	%	$	11,199	3	%
United Kingdom		79,022	17	%	⁽¹⁾		31,259	8	%		29,182	8	%
Turkey		2,041	—				12,114	3	%		17,103	5	%
Germany		951	—				—	0	%		26,457	8	%
Other⁽²⁾		31,815	7	%			32,670	8	%		29,911	9	%
Europe — Total		131,304	28	%			93,310	23	%		113,852	33	%
Asia and South Pacific:
India		103,422	22	%			87,492	22	%		64,381	18	%
Malaysia		55,189	12	%			26,748	7	%		8,767	3	%
Philippines		34,217	7	%			35,009	9	%		29,825	9	%
Indonesia		32,882	7	%			32,336	8	%		16,308	5	%
China		23,320	5	%			21,103	5	%		22,611	6	%
Other		18,550	5	%			18,756	4	%		10,496	3	%
Asia and South Pacific — Total		267,580	58	%			221,444	55	%		152,388	44	%
Mexico, South and Central America — Total		5,425	1	%			11,415	3	%		17,565	5	%
North America:
United States		16,267	4	%			20,147	5	%		17,647	5	%
Other		4,991	1	%			6,242	2	%		6,237	2	%
North America — Total		21,258	5	%			26,389	7	%		23,884	7	%
Middle East and Africa:
Ethiopia		30,019	6	%			30,019	8	%		30,018	9	%
Other		9,431	2	%			17,612	4	%		9,918	2	%
Middle East and Africa — Total		39,450	8	%			47,631	12	%		39,936	11	%
Total Lease Revenue	$	465,017	100	%		$	400,189	100	%	$	347,625	100	%

Year of Scheduled Lease Expiration	Narrow-body			Wide-body			Engines		Total
Off-lease		1			—			—		1
2020		9			—			—		9
2021		12			1			—		13
2022		18			—			6		24
2023		8			—			1		9
2024		5	⁽¹⁾		—			—		5
2025		4	⁽²⁾		2			—		6
2026		4			—			—		4
2027		1			2	⁽³⁾		—		3
2028		3			3			—		6
2029		7			1			—		8
2030		—			—			—		—
2031		2			—			—		2
Total		74			9			7		90

	Years ended					Increase/ (Decrease)
	2019		2018			Increase/ (Decrease)
	(Dollars in thousands)
Revenues
Operating lease revenue	$	464,399	$	399,514		$	64,885
Finance lease revenue		618		675			(57	)
Equity earnings (loss) from unconsolidated subsidiary		2,717		(54	)		2,771
Gain on sale of aircraft		97,323		13,398			83,925
Interest and other income		9,967		4,766			5,201
Total revenues		575,024		418,299			156,725
Expenses
Depreciation		140,798		144,084			(3,286	)
Interest expense		137,133		144,742			(7,609	)
Selling, general and administrative		35,304		31,185			4,119
Loss (gain) on derivatives		2,720		(2,382	)		5,102
Loss on modification and extinguishment of debt		9,590		2,474			7,116
Maintenance and other costs		3,075		2,547			528
Total expenses		328,620		322,650			5,970
Net income before provision for income taxes		246,404		95,649			150,755
Provision for income taxes		20,527		9,926			10,601
Net income	$	225,877	$	85,723		$	140,154

	Years ended						Increase/
	2018			2017			(Decrease)
	(Dollars in thousands)
Revenues
Operating lease revenue	$	399,514		$	346,894		$	52,620
Finance lease revenue		675			731			(56	)
Equity (loss) earnings from unconsolidated subsidiary		(54	)		496			(550	)
Gain on sale of aircraft		13,398			3,926			9,472
Interest and other income		4,766			1,204			3,562
Total revenues		418,299			353,251			65,048
Expenses
Depreciation		144,084			133,227			10,857
Aircraft impairment		—			22,000			(22,000	)
Interest expense		144,742			127,782			16,960
Selling, general and administrative		31,185			30,671			514
Gain on derivatives		(2,382	)		(192	)		(2,190	)
Loss on modification and extinguishment of debt		2,474			23,309			(20,835	)
Maintenance and other costs		2,547			2,524			23
Total expenses		322,650			339,321			(16,671	)
Net income before provision for income taxes		95,649			13,930			81,719
Provision for income taxes		9,926			11,332			(1,406	)
Net income	$	85,723		$	2,598		$	83,125

If redeemed during the 12-month period commencing on October 15 of the years set forth below:	Redemption Price
2019		101.594	%
2020 and thereafter		100.000	%

Name	Age	Position
Colm Barrington	74	Chief Executive Officer and Director
Julie Ruehl	54	Chief Financial Officer
Joseph M. Donovan	65	Director and Chairman
Erik G. Braathen	64	Director
Eugene McCague	61	Director
Robert S. Tomczak	58	Director
Susan M. Walton	59	Director
Steven Zissis	60	Director

	Shares Beneficially Owned
Name	Number		Percent
AirAsia Group Berhad ⁽¹⁾		3,333,333		10.8	%
Onex Corporation ⁽²⁾		3,110,143		10.1	%
Summit Aviation Partners LLC ⁽³⁾		2,261,214		7.3	%
Morgan Stanley ⁽⁴⁾		2,242,234		7.3	%
Donald Smith & Co., Inc. ⁽⁵⁾		2,068,405		6.7	%

Period	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of a Publicly Announced Repurchased Plan		Approximate Dollar Value of Shares that may yet be Purchased Under the Plans or Programs⁽¹⁾
January 1-31, 2019		—	$	—		—	$	50.0 million
February 1-28, 2019		—	$	—		—	$	50.0 million
March 1-31, 2019		197,592	$	13.59		197,592	$	47.3 million
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
July 1-31, 2019		84,016	$	16.99		84,016	$	21.5 million
August 1-31, 2019		258,476	$	16.78		258,476	$	17.2 million
September 1-30, 2019		—	$	—		—	$	50.0 million
October 1-31, 2019		—	$	—		—	$	50.0 million
November 1-30, 2019		—	$	—		—	$	50.0 million
December 1-31, 2019		—	$	—		—	$	50.0 million

	Page
Report of Independent Registered Public Accounting Firm	F-3
Consolidated Balance Sheets of Fly Leasing Limited as of December 31, 2019 and 2018	F-4
Consolidated Statements of Income of Fly Leasing Limited for the years ended December 31, 2019, 2018 and 2017	F-5
Consolidated Statements of Comprehensive Income of Fly Leasing Limited for the years ended December 31, 2019, 2018 and 2017	F-6
Consolidated Statements of Shareholders’ Equity of Fly Leasing Limited for the years ended December 31, 2017, 2018 and 2019	F-7
Consolidated Statements of Cash Flows of Fly Leasing Limited for the years ended December 31, 2019, 2018 and 2017	F-8
Notes to Consolidated Financial Statements	F-10
Schedule I — Condensed Financial Information of Parent	F-38

	December 31,
	2019			2018

Assets
Cash and cash equivalents	$	285,565		$	180,211
Restricted cash and cash equivalents		52,738			100,869
Rent receivables		14,264			9,307
Investment in finance lease, net		11,639			12,822
Flight equipment held for sale, net		144,119			259,644
Flight equipment held for operating lease, net		2,720,000			3,228,018
Maintenance rights		290,958			298,207
Deferred tax asset, net		11,675			6,505
Fair value of derivative assets		4,824			5,929
Other assets, net		129,377			124,960
Total assets	$	3,665,159		$	4,226,472
Liabilities
Accounts payable and accrued liabilities	$	22,746		$	23,146
Rentals received in advance		16,391			21,322
Payable to related parties		10,077			4,462
Security deposits		40,726			60,097
Maintenance payment liability, net		219,371			292,586
Unsecured borrowings, net		619,407			617,664
Secured borrowings, net		1,695,525			2,379,869
Deferred tax liability, net		57,935			36,256
Fair value of derivative liabilities		27,943			8,558
Other liabilities		76,761			80,402
Total liabilities		2,786,882			3,524,362
Shareholders’ equity
Common shares, $0.001 par value; 499,999,900 shares authorized; 30,898,410 and 32,650,019 shares issued and outstanding at December 31, 2019 and 2018, respectively		31			33
Manager shares, $0.001 par value; 100 shares authorized, issued and outstanding		—			—
Additional paid-in capital		516,254			549,123
Retained earnings		380,392			154,347
Accumulated other comprehensive loss, net		(18,400	)		(1,393	)
Total shareholders’ equity		878,277			702,110
Total liabilities and shareholders’ equity	$	3,665,159		$	4,226,472

	Manager Shares				Common Shares						Additional					Accumulated Other			Total
	Shares		Amount		Shares			Amount			Paid-in Capital			Retained Earnings		Comprehensive Loss, net			Shareholders’ Equity
Balance December 31, 2016		100	$	—		32,256,440		$	32		$	536,922		$	66,026	$	(9,745	)	$	593,235
Shares issued in connection with SARs exercised		—		—		1,481			—			—			—		—			—
Shares repurchased		—		—		(4,274,569	)		(4	)		(57,285	)		—		—			(57,289	)
Net income		—		—		—			—			—			2,598		—			2,598
Net change in the fair value of derivatives, net of deferred tax of $0.6 million⁽¹⁾		—		—		—			—			—			—		3,926			3,926
Reclassification from other comprehensive loss into earnings due to derivatives that no longer qualified for hedge accounting treatment, net of deferred tax of $0.2 million⁽¹⁾		—		—		—			—			—			—		1,239			1,239
Balance December 31, 2017		100	$	—		27,983,352		$	28		$	479,637		$	68,624	$	(4,580	)	$	543,709
Shares issued in connection with AirAsia transactions		—		—		4,666,667			5			69,486			—		—			69,491
Net income		—		—		—			—			—			85,723		—			85,723
Net change in the fair value of derivatives, net of deferred tax of $0.7 million⁽¹⁾		—		—		—			—			—			—		(530	)		(530	)
Reclassification from other comprehensive loss into earnings due to derivatives that no longer qualified for hedge accounting treatment, net of deferred tax of $0.3 million⁽¹⁾		—		—		—			—			—			—		3,717			3,717
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⁽¹⁾															168		(168	)		—
Adjusted balance January 1, 2019		100		—		32,650,019			33			549,123			154,515		(1,561	)		702,110
Shares issued in connection with SARs exercised		—		—		258,828			—			—			—		—			—
Shares repurchased		—		—		(2,010,437	)		(2	)		(32,869	)		—		—			(32,871	)
Net income		—		—		—			—			—			225,877		—			225,877
Net change in the fair value of derivatives, net of deferred tax of $3.5 million⁽¹⁾		—		—		—			—			—			—		(19,668	)		(19,668	)
Reclassification from other comprehensive loss into earnings due to derivatives that no longer qualified for hedge accounting treatment, net of deferred tax of $0.4 million⁽¹⁾		—		—		—			—			—			—		2,829			2,829
Balance December 31, 2019		100	$	—		30,898,410		$	31		$	516,254		$	380,392	$	(18,400	)	$	878,277

	December 31, 2019			December 31, 2018
Total minimum lease payments receivable	$	9,600		$	11,400
Estimated unguaranteed residual value of leased asset		4,227			4,227
Unearned finance income		(2,188	)		(2,805	)
Net Investment in Finance Lease	$	11,639		$	12,822

Year ending December 31,	(Dollars in thousands)
2020	$	1,800
2021		1,800
2022		1,800
2023		1,800
2024		1,800
Thereafter		600
Future minimum rental payments under finance lease	$	9,600

	December 31, 2019			December 31, 2018
Cost	$	3,334,996		$	3,900,938
Accumulated depreciation		(614,996	)		(672,920	)
Flight equipment held for operating lease, net	$	2,720,000		$	3,228,018

Year ending December 31,
2020	$	2,573
2021		3,221
2022		2,821
2023		1,614
2024		736
Thereafter		303
Future amortization of lease incentives	$	11,268

	December 31, 2019			December 31, 2018
Maintenance rights, net beginning balance	$	298,207		$	131,299
Acquisitions		94,664			189,864
Capitalized to aircraft improvements		(6,739	)		(9,240	)
Maintenance rights settled with retained maintenance payments		(3,996	)		(2,369	)
Cash receipts from maintenance rights		(4,637	)		(3,013	)
Maintenance rights associated with aircraft sold		(86,541	)		(8,334	)
Maintenance rights, net ending balance	$	290,958		$	298,207

	December 31, 2019		December 31, 2018
Portfolio B orderbook value	$	100,935	$	103,951
Equity certificates		16,048		5,747
Value added tax receivables, net		7,714		6,016
Investment in unconsolidated subsidiary		259		2,908
Other assets		4,421		6,338
Total other assets	$	129,377	$	124,960

	Balance as of
	December 31, 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			(5,593	)			(7,336	)
Unsecured borrowings, net		$	619,407			$	617,664

	Outstanding principal balance as of December 31,						Weighted average interest rate⁽¹⁾ as of December 31,
	2019⁽²⁾			2018⁽²⁾			2019			2018			Maturity date
Securitization Notes	$	—		$	85,584			—			3.08	%	—
Nord LB Facility		65,290			108,882			3.59	%		4.29	%	May 2021
Term Loan		385,364			407,768			4.15	%		5.17	%	August 2025
Magellan Acquisition Limited Facility		278,684			305,226			4.11	%		4.18	%	December 2025
Fly Acquisition III Facility		—			190,457			—			4.10	%	—
Fly Aladdin Acquisition Facility		272,343			467,179			4.85	%		4.59	%	June 2023
Fly Aladdin Engine Funding Facility		42,339			43,829			4.95	%		4.95	%	December 2021 – April 2022
Other Aircraft Secured Borrowings		673,463			807,882			4.07	%		4.44	%	December 2020 – June 2028
Total outstanding principal balance		1,717,483			2,416,807
Unamortized debt discounts and loan costs		(21,958	)		(36,938	)
Total secured borrowings, net	$	1,695,525		$	2,379,869

Year ending December 31,
2020	$	172,684
2021		241,435
2022		169,409
2023		408,302
2024		113,733
Thereafter		611,920
Future minimum principal payments due	$	1,717,483

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	$	58,592	$	4,805	$	4,204
Accrued rent						—		19		—
Total - designated derivative asset		1			$	58,592	$	4,824	$	4,204

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		30	2/9/23-12/8/25		2.28%-3.13	%	$	792,636	$	(26,559	)	$	(22,615	)
Accrued interest								—		(932	)		—
Total – designated derivative liabilities		30					$	792,636	$	(27,491	)	$	(22,615	)

	December 31, 2019			December 31, 2018
Deferred tax asset:
Net operating loss carry forwards	$	142,685		$	177,663
Net unrealized losses on derivative instruments		3,794			773
Basis difference on acquisition of GAAM Australian assets		6,575			6,619
Other		124			168
Valuation allowance		(33,929	)		(37,429	)
Total deferred tax asset		119,249			147,794
Deferred tax liability:
Excess of tax depreciation over book depreciation		(165,343	)		(171,725	)
Miscellaneous book/tax differences		(166	)		(112	)
Net earnings of non-European Union member subsidiaries		—			(3,654	)
Withholding tax on Australian unrepatriated earnings		—			(2,054	)
Total deferred tax liability		(165,509	)		(177,545	)
Deferred tax liability, net	$	(46,260	)	$	(29,751	)

	December 31, 2019		December 31, 2018
Current tax payable	$	308	$	50
Lease discount		24,965		25,539
Lease incentive obligation		15,634		14,020
Deferred rent		15,715		15,067
Refundable deposits		3,210		3,420
Other		16,929		22,306
Total other liabilities	$	76,761	$	80,402

	Number of shares		Weighted average exercised price		Weighted average remaining contractual life (in years)
Outstanding and vested at January 1, 2017		821,117	$	12.74		4.1
SARs exercised		24,137		12.73
Outstanding at December 31, 2017		796,980	$	12.74		3.1
SARs exercised		—		—
Outstanding at December 31, 2018		796,980	$	12.74		2.1
SARs exercised		782,955		12.73
Outstanding and exercisable at December 31, 2019		14,025		12.95		1.6