[ ]
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Preliminary Proxy Statement
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[ ]
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Confidential, for the Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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[X]
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Definitive Proxy Statement
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[ ]
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Definitive Additional Materials
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[ ]
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Soliciting Material Pursuant to §240.14a-12
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[X]
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No fee required.
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[ ]
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11
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(1)
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Title of each class of securities to which transaction applies:
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(2)
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Aggregate number of securities to which transaction applies:
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(3)
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Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined):
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(4)
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Proposed maximum aggregate value of transaction:
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(5)
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Total fee paid:
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[ ]
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Fee paid previously with preliminary materials.
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[ ]
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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(1)
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Amount Previously Paid:
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(2)
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Form, Schedule or Registration Statement No.:
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(3)
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Filing Party:
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(4)
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Date Filed:
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Christopher L. Beers
|
|
Chief Legal Officer & Secretary
|
1.
|
the election of four Class I Directors to serve until the 2022 annual general meeting of Aircastle Limited or until their office shall otherwise be vacated pursuant to our Bye-laws;
|
2.
|
the appointment of Ernst & Young LLP as independent registered public accounting firm for Aircastle Limited for fiscal year 2019 and the authorization of the Directors of Aircastle Limited, acting by the Audit Committee, to determine the independent registered public accounting firm’s fees;
|
3.
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an advisory vote on executive compensation; and
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4.
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any other business properly presented at the Annual Meeting and any adjournment(s) or postponement(s) of the Annual Meeting.
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Christopher L. Beers
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Chief Legal Officer & Secretary
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Page
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GENERAL INFORMATION ABOUT THE MEETING
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Date, Time and Place of Annual General Meeting
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Matters to be Considered at the Annual General Meeting
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Quorum and Voting Requirements
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Voting of Proxy
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Revocability of Proxy
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Persons Making the Solicitation
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Recommendations of the Board of Directors
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Attendance at the Meeting
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CORPORATE GOVERNANCE
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Legal Proceedings Involving Directors, Officers or Affiliates
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Director Independence
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Policies and Practices
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Corporate Governance Guidelines
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Code of Business Conduct and Ethics
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Communications with the Board
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Meetings of the Board
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Board Leadership Structure and Executive Sessions
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Board Oversight of Risk Management
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Committees of the Board
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DIRECTORS’ COMPENSATION
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Cash Compensation
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Restricted Share Grants
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Share Ownership Guidelines for Directors
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Director Award Limits
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OWNERSHIP OF THE COMPANY’S COMMON SHARES
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Security Ownership of Certain Beneficial Owners and Management
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Section 16(a) Beneficial Ownership Reporting Compliance
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Insider Trading Policy
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EXECUTIVE COMPENSATION
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Compensation Discussion and Analysis
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Pay for Performance Philosophy
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What We Pay
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What We Don’t Pay
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2018 Compensation
|
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Long-Term Incentive Plan
|
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How We Make Decisions
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Share Ownership Guidelines
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Tax Implications of Our Compensation
|
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Last Year’s Say on Pay Vote
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Compensation Committee Interlocks and Insider Participation
|
|
Compensation Overview
|
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CEO Compensation Comparison
|
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COMPENSATION COMMITTEE REPORT
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Summary Compensation Table for 2018
|
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Grants of Plan-Based Awards for 2018
|
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Employment Agreements with Named Executive Officers
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Restricted Share and PSU Provisions under the Incentive Plan
|
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Outstanding Equity Awards at Fiscal Year-End for 2018
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Stock Vested for 2018
|
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Potential Payments upon Termination or Change in Control
|
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Equity Compensation Plan Information
|
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AUDIT COMMITTEE REPORT
|
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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
|
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Marubeni Corporation Shareholder Agreement Amendment
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Joint Venture with Ontario Teachers’ Pension Plan
|
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Policies and Procedures For Review, Approval or Ratification of Transactions with Related Persons
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PROPOSAL NO. 1 – ELECTION OF DIRECTORS
|
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PROPOSAL NO. 2 – APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
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Audit Fees, Audit Related Fees, Tax Fees and All Other Fees
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Audit Committee Pre-Approval Policies and Procedures
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PROPOSAL NO. 3 – ADVISORY VOTE ON EXECUTIVE COMPENSATION
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OTHER MATTERS
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CONFIDENTIALITY OF PROXIES
|
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SHAREHOLDER PROPOSALS
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ADDITIONAL INFORMATION
|
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IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON MAY 17, 2019
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|
GENERAL
|
|
APPENDIX A - RECONCILIATION OF NON-GAAP MEASURES TO U.S. GAAP RESULTS
|
1.
|
the election of four Class I Directors to serve until the 2022 annual general meeting of Aircastle or until their office shall otherwise be vacated pursuant to our Bye-laws;
|
2.
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the appointment of Ernst & Young LLP as independent registered public accounting firm for the Company for fiscal year 2019 and the authorization of the Directors of Aircastle, acting by the Audit Committee, to determine the independent registered public accounting firm’s fees;
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4.
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any other business properly presented at the Annual Meeting and any adjournment(s) or postponement(s) of the Annual Meeting.
|
•
|
The affirmative vote of a plurality of the votes cast at the Annual Meeting is sufficient to elect each of the nominees to our Board (Proposal No. 1).
|
•
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The affirmative vote of a majority of the votes cast at the Annual Meeting is required:
|
(i)
|
to appoint Ernst & Young LLP for fiscal year 2019 and to authorize the Board, acting by the Audit Committee, to determine the independent registered public accounting firm’s fees (Proposal No. 2);
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(ii)
|
to approve, on an advisory basis, executive compensation (Proposal No. 3); and
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(iv)
|
to approve any other business properly presented at the Annual Meeting.
|
•
|
By Internet or Telephone
|
•
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By Mail
|
•
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By internet at www.proxyvote.com;
|
•
|
By telephone at 1-800-690-6903; or
|
•
|
By email at sendmaterial@proxyvote.com.
|
•
|
In Person, at the Annual Meeting
|
•
|
FOR
the election of the Director nominees named herein;
|
•
|
FOR
the appointment of Ernst & Young LLP as independent registered public accounting firm for the Company for fiscal year 2019 and the authorization of the Directors of Aircastle, acting by the Audit Committee, to determine the independent registered public accounting firm’s fees; and
|
•
|
FOR
the approval, on an advisory basis, of the compensation of our named executive officers.
|
•
|
a Director who is or has been within the last three years an employee, or whose immediate family member is or has been within the last three years an executive officer, of Aircastle (including any consolidated subsidiary);
|
•
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a Director who has received, or whose immediate family member has received, during any twelve-month period within the last three years, more than US$120,000 in direct compensation from Aircastle (including any consolidated subsidiary), other than Director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service);
|
•
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a Director who (i) is, or whose immediate family is, a current partner of a firm that is the internal or external auditor of Aircastle; (ii) is a current employee of such a firm; (iii) has an immediate family member who is a current employee of such a firm and who personally works on Aircastle’s audit; or (iv) was, or whose immediate family member was, within the last three years a partner or employee of such a firm and personally worked on Aircastle’s audit within that time;
|
•
|
a Director who is or has been within the last three years employed, or whose immediate family member is or has been within the last three years employed as an executive officer of another company where any of Aircastle’s present executive officers at the same time serves or served on that Company’s compensation committee; and
|
•
|
a Director who is a current employee, or whose immediate family member is an executive officer, of a company (or a consolidated subsidiary of such company) that has made payments to, or has received payments from, Aircastle for property or services in an amount which, in any single fiscal year within the last three years, exceeds the greater of US$1,000,000 or 2% of such other company’s consolidated gross revenues.
|
•
|
the source of compensation of such Director, including any consulting, advisory or other compensatory fee paid by Aircastle to such Director; and
|
•
|
whether such Director is affiliated with Aircastle, a subsidiary of Aircastle or an affiliate of a subsidiary of Aircastle.
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Name
|
|
Audit
|
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Compensation
|
|
Nominating and
Corporate Governance
|
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Investment
|
Ronald W. Allen*
|
|
X
|
|
|
|
|
|
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Giovanni Bisignani
|
|
|
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|
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X
|
|
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Michael J. Cave*
|
|
X
|
|
|
|
|
|
X
|
Douglas A. Hacker*
|
|
X
|
|
X
|
|
|
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Chair
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Michael J. Inglese
|
|
|
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X
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Hajime Kawamura
|
|
|
|
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|
|
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Ronald L. Merriman*
|
|
Chair
|
|
X
|
|
|
|
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Agnes Mura
|
|
|
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X
|
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Chair
|
|
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Charles W. Pollard
|
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|
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Chair
|
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X
|
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X
|
Takayuki Sakakida
|
|
|
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Gentaro Toya
|
|
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Peter V. Ueberroth
|
|
|
|
|
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X
|
|
|
*
|
|
Messrs. Allen, Cave, Hacker and Merriman serve as financial experts on our Audit Committee.
|
•
|
reviewing (i) the audit plans and findings of the independent certified public accountants and our internal audit and risk review staff and (ii) the results of regulatory examinations and monitoring management’s corrective action plans with respect to such plans, findings and results where necessary;
|
•
|
reviewing our financial statements, including any significant financial items and/or changes in accounting policies, with our senior management and independent certified public accountants;
|
•
|
reviewing our accounting and internal control policies and procedures, compliance programs and significant tax and legal matters;
|
•
|
reviewing related party transactions;
|
•
|
making recommendations to our shareholders regarding the annual appointment by our shareholders of the independent certified public accountants (which constitutes the auditor for purposes of Bermuda law) considering their reputation and qualifications and evaluating their independence and performance, as well as setting clear hiring policies for employees or former employees of our independent certified public accounting firm;
|
•
|
overseeing the independent certified public accountants (which constitutes the auditor for purposes of Bermuda law) and evaluating their compensation; and
|
•
|
reviewing the process by which we assess and manage exposure to financial and legal risk.
|
•
|
reviewing the salaries, benefits and share-based grants for executive officers;
|
•
|
reviewing corporate goals and objectives relevant to Chief Executive Officer compensation, evaluating the Chief Executive Officer’s performance in light of those goals and objectives, and determining the Chief Executive Officer’s compensation based on that evaluation;
|
•
|
acting as administrator of the Aircastle Limited Amended and Restated 2014 Omnibus Incentive Plan and prior plans (the “Incentive Plan”); and
|
•
|
reviewing risks relating to the Company’s employment practices and the Company’s compensation and benefits practices.
|
•
|
reviewing the performance of the Board and incumbent Directors and making recommendations to our Board regarding the selection of candidates, qualification and competency requirements for service on the Board and the suitability of proposed nominees;
|
•
|
advising the Board with respect to the corporate governance principles applicable to the Company;
|
•
|
reviewing risks associated with the Company’s management and Director succession planning; and
|
•
|
overseeing the evaluation of the Board and the Company’s management.
|
•
|
Directors are paid an annual cash fee of US$80,000.
|
•
|
The Chairman of the Board is paid an additional annual cash fee of US$50,000.
|
•
|
Each of the chairs of the Audit Committee and Investment Committee is paid an annual cash fee of US$35,000 and each other such committee member is paid an annual cash fee of US$20,000.
|
•
|
The Compensation Committee Chair is paid an annual cash fee of US$25,000 and Compensation Committee members are paid an annual cash fee of US$10,000.
|
•
|
The Nominating and Corporate Governance Committee chair is paid an annual cash fee of US$20,000 and Nominating and Corporate Governance Committee members are paid an annual cash fee of US$10,000.
|
DIRECTOR COMPENSATION FOR 2018
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||
|
|
Fees Earned or
|
|
|
|
All Other
|
|
|
||||
|
|
Paid in Cash
|
|
Stock Awards
|
|
Compensation
|
|
Total
|
||||
Name
|
|
(US$)
|
|
(US$)
(1)
|
|
(US$)
(2)
|
|
(US$)
|
||||
|
|
|
|
|
|
|
|
|
||||
Ronald W. Allen
|
|
100,000
|
|
135,007
|
|
6,580
|
|
241,587
|
||||
|
|
|
|
|
|
|
|
|
||||
Giovanni Bisignani
|
|
90,000
|
|
135,007
|
|
6,580
|
|
231,587
|
||||
|
|
|
|
|
|
|
|
|
||||
Michael J. Cave
|
|
120,000
|
|
135,007
|
|
6,580
|
|
261,587
|
||||
|
|
|
|
|
|
|
|
|
||||
Douglas A. Hacker
|
|
145,000
|
|
135,007
|
|
6,580
|
|
286,587
|
||||
|
|
|
|
|
|
|
|
|
||||
Hajime Kawamura
(3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
||||
Yukihiko Matsumura
(4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
||||
Ronald L. Merriman
|
|
125,000
|
|
135,007
|
|
6,580
|
|
266,587
|
||||
|
|
|
|
|
|
|
|
|
||||
Agnes Mura
|
|
110,000
|
|
135,007
|
|
6,580
|
|
251,587
|
||||
|
|
|
|
|
|
|
|
|
||||
Charles W. Pollard
|
|
135,000
|
|
135,007
|
|
6,580
|
|
276,587
|
||||
|
|
|
|
|
|
|
|
|
||||
Takayuki Sakakida
(3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
||||
Gentaro Toya
(3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
||||
Peter V. Ueberroth
|
|
140,000
|
|
322,127
|
|
15,700
|
|
477,827
|
||||
|
|
|
|
|
|
|
|
|
||||
Michael J. Inglese
(3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
(1)
|
The reported amounts reflect the aggregate fair value on the grant date of the restricted shares granted to our Directors during 2018 determined in accordance with FASB ASC Topic 718. For a summary of the assumptions made in the valuation of these awards, please see Note 8 to our Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2018. The grant date fair value of each restricted share was US
$23.39
. The number of unvested restricted shares granted to each Director in 2018 and held by each Director as of December 31, 2018 was: Mr. Allen 5,772, Mr. Bisignani 5,772, Mr. Cave 5,772, Mr. Hacker 5,772, Mr. Merriman 5,772, Ms. Mura 5,772 and Mr. Pollard 5,772. Mr. Ueberroth was granted a total of 13,772 restricted shares in 2018, compromised of the base director grant of 5,772 restricted shares and an additional 8,000 restricted shares reflecting the pro-rata amount of his annual chairman’s special 20,000 restricted share award.
|
(2)
|
The reported amounts consist of dividend payments made by the Company on restricted common shares granted to each Director in 2018.
|
(3)
|
Our affiliated and management Directors, Messrs. Inglese, Kawamura, Sakakida and Toya are not separately compensated by us for their Board or committee service.
|
(4)
|
Mr. Matsumura resigned from the Board effective May 1, 2018.
|
Position
|
|
Multiple of Base Annual Cash Board Service Fee
|
Relevant Director
|
|
3x
|
Name of Beneficial Owner
|
|
Amount and Nature of Beneficial Ownership
(1) (2)
|
|
Percent
(3)
|
|
Named Executive Officers and Directors
(4)
|
|
|
|
|
|
Michael J. Inglese
(5)
|
|
361,559
|
|
|
*
|
Aaron A. Dahlke
|
|
43,652
|
|
|
*
|
Michael L. Kriedberg
|
|
180,968
|
|
|
*
|
Christopher L. Beers
|
|
79,582
|
|
|
*
|
Roy Chandran
|
|
43,263
|
|
|
*
|
Ronald W. Allen
|
|
109,627
|
|
|
*
|
Giovanni Bisignani
|
|
40,313
|
|
|
*
|
Michael J. Cave
|
|
27,521
|
|
|
*
|
Douglas A. Hacker
|
|
112,767
|
|
|
*
|
Hajime Kawamura
(5)
|
|
—
|
|
|
*
|
Ronald L. Merriman
(6)
|
|
46,752
|
|
|
*
|
Agnes Mura
|
|
31,045
|
|
|
*
|
Charles W. Pollard
(7)
|
|
51,287
|
|
|
*
|
Takayuki Sakakida
(5)
|
|
—
|
|
|
*
|
Gentaro Toya
(5)
|
|
—
|
|
|
*
|
Peter V. Ueberroth
(8)
|
|
425,993
|
|
|
*
|
All Directors and executive officers as a group (16 persons)
|
|
1,554,329
|
|
|
2.1%
|
5% Shareholders
|
|
|
|
|
|
Marubeni Corporation
(9)
|
|
21,605,347
|
|
|
28.8%
|
The Vanguard Group
(10)
|
|
4,726,470
|
|
|
6.3%
|
Dimensional Fund Advisors L.P.
(11)
|
|
6,620,410
|
|
|
8.8%
|
_______________
|
|
|
|
|
|
* Less than 1%
|
|
|
|
|
(1)
|
Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Common shares subject to options or warrants currently exercisable or exercisable within 60 days of the date hereof, are deemed outstanding for computing the percentage of the person holding such options or warrants but are not deemed outstanding for computing the percentage of any other person.
|
(2)
|
Consists of common shares held, including restricted shares, shares underlying share options exercisable within 60 days and shares underlying warrants exercisable within 60 days.
|
(3)
|
Percentage amount assumes the exercise by such persons of all options and warrants exercisable within 60 days to acquire common shares and no exercise of options or warrants by any other person.
|
(4)
|
The address of each officer or Director listed in the table below is: c/o Aircastle Advisor LLC, 201 Tresser Boulevard, Suite 400, Stamford, CT 06901.
|
(5)
|
Our affiliated and management Directors, Messrs. Inglese, Kawamura, Sakakida and Toya are not separately compensated by us for their Board or committee service. Common shares of Aircastle are directly held by Marubeni Aviation Holding Cooperatief, U.A. and indirectly held by Marubeni and Marubeni Aviation Corporation.
|
(6)
|
Includes 35,009 common shares held indirectly by the Merriman Family Trust.
|
(7)
|
Includes 34,916 common shares held indirectly by the Pollard Family Trust.
|
(8)
|
Includes 220,000 common shares held indirectly by the Ueberroth Family Trust.
|
(9)
|
Information for Marubeni is based solely upon a Schedule 13D
filed by Marubeni with the SEC on February 23, 2016, which indicates that Marubeni beneficially held an aggregate of
21,605,347
common shares. Marubeni reported it held all
21,605,347
shares with shared voting and dispositive power. The address of Marubeni is 4-2 Ohtemachi 1-Chome Chiyoda-Ku, Tokyo 100-8088, Japan.
|
(10)
|
Information regarding The Vanguard Group is based solely upon a Schedule 13G filed by The Vanguard Group with the SEC on February 11, 2019, which indicates that The Vanguard Group beneficially held an aggregate of
4,726,470
common shares. Of these shares, The Vanguard Group reported it held 53,878 shares with sole voting power, 7,971 shares with shared voting power, 4,668,843 shares with sole dispositive power and 57,627 shares with shared dispositive power. The address of The Vanguard Group is 100 Vanguard Blvd., Malvern, PA 19355.
|
(11)
|
Information regarding Dimensional Fund Advisors L.P. (“Dimensional”) is based solely upon a Schedule 13G filed by Dimensional with the SEC on February 8, 2019, which indicates that Dimensional beneficially held an aggregate of
6,620,410
common shares. Of these shares, Dimensional reported it held 6,520,155 shares with sole voting power and 6,620,410 shares with sole dispositive power. The address of Dimensional is Building One, 6300 Bee Cave Road, Austin, TX 78746.
|
Name
|
|
Title
|
Michael J. Inglese
|
|
Chief Executive Officer
|
Aaron A. Dahlke
|
|
Chief Financial Officer
|
Michael L. Kriedberg
|
|
Chief Commercial Officer
|
Christopher L. Beers
|
|
Chief Legal Officer & Secretary
|
Roy Chandran
|
|
EVP - Corporate Finance & Strategy
|
•
|
Annual Corporate Performance
: Achievement of internal corporate financial metrics focused on: (i) adjusted return on equity; (ii) cash flow per share; and (iii) growth through new investments;
|
•
|
Individual Performance
: Achievement of individual performance goals set at the beginning of each year; and
|
•
|
Long-Term Corporate Performance
: Longer term adjusted return on equity and total shareholder return relative to a broad index of relevant publicly listed companies.
|
Position
|
Corporate Performance
|
|
Individual
Performance
|
CEO
|
85%
|
|
15%
|
Other NEOs
|
80%
|
|
20%
|
Metric
|
|
2018 Target
|
|
Performance
Range
|
|
Weighted Score
|
Adjusted Return on Equity
(1)
|
|
8.79%
|
|
25-150%
|
|
25%
|
Cash Flow per Share
(2)
|
|
$6.30
|
|
85-115%
|
|
50%
|
New Investments
(3)
(in billions)
|
|
$1.40
|
|
50-150%
|
|
25%
|
(1)
|
Adjusted Return on Equity is Adjusted Net Income divided by the average shareholders’ equity. Adjusted Net Income, or ANI, is net income before certain expenses related to our financings and interest rate derivative accounting, share-based compensation expense and other items we have deemed unusual when viewed in the context of our ongoing business. Our presentation of ANI may not be comparable to similarly-titled measures used by other companies. A reconciliation between non-GAAP performance metrics and U.S. GAAP results is included as Appendix A to this proxy statement.
|
(2)
|
Cash Flow per Share for a period is Cash Flow from Operations before changes in working capital plus principal payments from our finance leases and distributions from our joint venture investment divided by the total weighted average number of shares outstanding plus contingently issuable shares related to the Company’s PSUs, for that period. A reconciliation between non-GAAP performance metrics and U.S. GAAP results is included as Appendix A to this proxy statement.
|
(3)
|
New Investments measures the total annual amount invested in aviation assets.
|
•
|
motivate our NEOs by providing the large majority of their overall compensation through an incentive compensation program that ties awards to corporate financial metrics and individual performance goals which we believe will build shareholder value; and
|
•
|
align each NEO’s incentives with those of shareholders by delivering a substantial portion of their incentive compensation in the form of restricted share grants and performance based equity awards.
|
•
|
Change in control benefits based on a single trigger;
|
•
|
Deferred compensation plans;
|
•
|
Company cars or aircraft;
|
•
|
Income tax gross-ups; and
|
•
|
Special or enhanced pension or retirement programs.
|
Metric
|
|
2018
Target
|
|
Weighting
|
|
2018 Performance
|
|
Performance Range
|
|
Performance
|
|
Weighted Score
|
|
Adjusted Return on Equity
(1)
|
|
8.79%
|
|
25%
|
|
13.08%
|
|
25-150%
|
|
148.8%
|
|
49.4
|
%
|
Cash Flow per Share
(1)
|
|
$6.30
|
|
50%
|
|
$6.65
|
|
85-115%
|
|
105.7%
|
|
68.8
|
%
|
New Investments (in billions)
|
|
$1.40
|
|
25%
|
|
$1.44
|
|
50-150%
|
|
102.5%
|
|
26.3
|
%
|
|
|
|
|
|
|
|
|
|
|
Total
|
144.5
|
%
|
(1)
|
A reconciliation between non-GAAP performance metrics and U.S. GAAP results is included as Appendix A to this proxy statement.
|
•
|
Acquired 39 aircraft in 2018 for $1.44 billion, all narrow-body aircraft. We believe these investments improved the quality of the Company’s portfolio and its earnings base.
|
•
|
Sold fourteen aircraft for proceeds of $338.8 million with a gain on sale of $36.8 million, including two wide-bodies, further improving the quality of our portfolio.
|
•
|
Acquired ten Airbus A320 Neos and increased the share of current generation narrow-body aircraft in our portfolio from 66% to 72% of net book value, dramatically improving the quality of our portfolio.
|
•
|
Placed, sold or committed to sell 45 aircraft with scheduled lease expirations in 2018 and 2019. As a result, we now have just two narrow-body aircraft left to place returning in the fourth quarter of 2019 and only two wide-body aircraft to place before 2020.
|
•
|
Achieved excellent aircraft utilization with our aircraft being on lease 99.6% of the time
(1)
and a net cash interest margin of 7.8%
(2)
.
|
Named Executive Officer
|
Incentive Compensation
(1)
|
Rationale
|
|
|
|
Michael J. Inglese
|
$935,550 cash $935,555 restricted share grant
|
Mr. Inglese led the Company’s development and execution of its strategic and operational business plan. Under Mr. Inglese’s leadership, the Company met its new investment plan, generated strong cash flow in excess of plan and exceeded its adjusted return on equity targets even before factoring accelerated maintenance revenue.
|
Aaron A. Dahlke
|
$554,400 cash $277,204 restricted share grant
|
Mr. Dahlke led the Company’s finance, corporate planning and IT efforts. His work resulted in the Company’s clear operating plan, improved aircraft portfolio and earnings base, strong financial results and secure IT infrastructure. He also made significant contributions towards the Company’s management of collections and repossessions.
|
Michael L. Kriedberg
|
$1,039,500 cash $0 restricted share grant
|
Mr. Kriedberg led the Company’s aircraft acquisitions, placements and sales efforts. In this regard, he played a key role in directing the Company’s new investment, sales and placement activities in a highly competitive environment. Mr. Kriedberg intends to retire in the beginning of 2020 and as part of his Retirement and Transition Agreement, Mr. Kriedberg received a 125% target cash bonus but no restricted share grant for 2018.
|
Christopher L. Beers
|
$693,00 cash $346,506 restricted share grant
|
Mr. Beers led the Company’s legal organization and human resources function. His legal team directed, documented and executed the substantial volume of transaction activity and he was instrumental in managing our repossessions and collections. He also managed changes in key personnel.
|
Roy Chandran
|
$562,400 cash $281,192 restricted share grant
|
Mr. Chandran led our capital markets activities and is responsible for evaluating strategic transactions, managing the investor relations and pricing functions. During 2018, the Company received an investment grade credit rating from three rating agencies: Standard & Poor’s. Moody’s and Fitch.
|
(1)
|
All restricted share awards were granted in early 2019 and grants vest in equal installments on January 1, 2020, 2021 and 2022, subject to the terms and conditions of the Incentive Plan.
|
Relative Percentile
|
Vesting Percentage
|
80
th
or higher
|
200%
|
55
th
|
100%
|
30
th
|
50%
|
below 30
th
|
0%
|
Actual AROE Performance
|
Applicable Percentage
|
Annual AROE Target plus 2%
|
200%
|
Annual AROE Target
|
100%
|
Annual AROE Target less 2%
|
50%
|
Below Annual AROE Target less 2%
|
0%
|
Name
|
|
Target/Maximum
Number of PSUs
(1)
|
|
Target/Maximum
Number of
TSR PSUs
|
|
Target/Maximum
Number of
AROE PSUs
|
Michael J. Inglese
|
|
132,312/264,624
|
|
66,156/132,312
|
|
66,156/132,312
|
Aaron A. Dahlke
|
|
32,498/64,996
|
|
16,249/32,498
|
|
16,249/32,498
|
Michael L. Kriedberg
|
|
40,622/81,244
|
|
20,312/40,624
|
|
20,310/40,620
|
Christopher L. Beers
|
|
53,389/106,778
|
|
26,695/53,390
|
|
26,694/53,388
|
Roy Chandran
|
|
32,498/64,996
|
|
16,249/32,498
|
|
16,249/32,498
|
(1)
|
All awards were made in February 2018.
|
PSU Award
|
|
TSR Payout Tracking
(1)
|
|
AROE Payout Tracking
(2)
|
March 2016
|
|
0%
|
|
140.0%
|
March 2017
|
|
0%
|
|
135.0%
|
June 2017
|
|
0%
|
|
132.5%
|
February 2018
|
|
0%
|
|
200.0%
|
(1)
|
Our TSR from the beginning of the performance period through December 31, 2018, relative to the S&P400 is as follows: March 2016 PSU TSR Awards were in the 27th percentile which would have resulted in a payout below threshold or 0% of the target award; March 2017 PSU TSR Awards were in the 33rd percentile which would have resulted in a payout below threshold or 0% of the target award; June 2017 PSU TSR Awards were in the 24th percentile which would have resulted in a payout below threshold or 0% of the target award; and February 2018 PSU TSR Awards were in the 28th percentile which would have resulted in a payout below threshold or 0% of the target award.
|
(2)
|
See table below for AROE tracking percentages.
|
2016 LTIP Actual Share Payout of Target
|
||
TRS Payout
|
AROE Payout
|
Total Payout
|
0%
|
140.0%
|
70.0%
|
•
|
the use of multiple corporate financial performance metrics, rather than relying on a single measure;
|
•
|
the use of ranges for these financial performance metrics, so that the earning of the awards is not an “all or nothing” proposition;
|
•
|
the use of performance-based and time-based equity awards vesting over a three-year period, increasing the focus on longer-term performance and shareholder value growth;
|
•
|
greater weighting on performance-based equity versus time-based equity; and
|
•
|
the adoption of robust share ownership guidelines and a recoupment policy.
|
Position
|
|
Multiple of Base Salary
|
Chief Executive Officer
|
|
6x
|
Chief Financial Officer
|
|
2x
|
Chief Commercial Officer
|
|
2x
|
Chief Legal Officer
|
|
2x
|
|
|
|
|
|
|
|
|
Stock Awards (US$)
(1)
|
|
|
|
|
||||||||
Name and Principal Position
|
|
Fiscal
Year
|
|
Salary (US$)
|
|
Cash Bonus(US$)
|
|
Annual Equity Award
|
|
Long Term Incentive Plan
|
|
All Other
Compensation (US$)
(2)
|
|
Total
(US$)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Michael J. Inglese
|
|
2018
|
|
675,000
|
|
|
935,550
|
|
|
935,555
|
|
|
2,850,000
|
|
|
110,288
|
|
|
5,506,393
|
|
Chief Executive Officer
|
|
2017
|
|
673,077
|
|
|
716,580
|
|
|
1,591,574
|
|
|
2,475,000
|
|
|
87,388
|
|
|
5,543,619
|
|
(formerly Chief Financial Officer)
(4)
|
|
2016
|
|
541,667
|
|
|
595,540
|
|
|
297,762
|
|
|
1,100,000
|
|
|
80,179
|
|
|
2,615,148
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Aaron A. Dahlke
|
|
2018
|
|
400,000
|
|
|
554,400
|
|
|
277,204
|
|
|
700,000
|
|
|
32,874
|
|
|
1,964,478
|
|
Chief Financial Officer
|
|
2017
|
|
362,901
|
|
|
424,640
|
|
|
312,330
|
|
|
425,956
|
|
|
19,871
|
|
|
1,545,698
|
|
(formerly Chief Accounting Officer)
(4)
|
|
2016
|
|
300,000
|
|
|
242,428
|
|
|
47,474
|
|
|
160,000
|
|
|
21,230
|
|
|
771,132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Michael L. Kriedberg
(3)
|
|
2018
|
|
600,000
|
|
|
1,039,500
|
|
|
—
|
|
|
874,998
|
|
|
131,595
|
|
|
2,646,093
|
|
Chief Commercial Officer
|
|
2017
|
|
562,500
|
|
|
636,960
|
|
|
849,457
|
|
|
1,499,993
|
|
|
155,787
|
|
|
3,704,697
|
|
|
|
2016
|
|
486,667
|
|
|
535,986
|
|
|
267,976
|
|
|
990,000
|
|
|
149,952
|
|
|
2,430,581
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Christopher L. Beers
|
|
2018
|
|
500,000
|
|
|
693,000
|
|
|
346,506
|
|
|
1,150,000
|
|
|
71,564
|
|
|
2,761,070
|
|
Chief Legal Officer & Secretary
|
|
2017
|
|
454,167
|
|
|
540,800
|
|
|
420,396
|
|
|
900,000
|
|
|
67,829
|
|
|
2,383,192
|
|
|
|
2016
|
|
400,000
|
|
|
395,222
|
|
|
197,621
|
|
|
730,000
|
|
|
71,898
|
|
|
1,794,741
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Roy Chandran
(4)
|
|
2018
|
|
400,000
|
|
|
562,400
|
|
|
281,192
|
|
|
700,000
|
|
|
34,944
|
|
|
1,978,536
|
|
EVP Corporate Finance & Strategy
(formerly EVP Capital Markets)
(4)
|
|
2017
|
|
395,833
|
|
|
424,640
|
|
|
312,330
|
|
|
350,844
|
|
|
24,386
|
|
|
1,508,033
|
|
(1)
|
The amounts reported in the “Annual Equity Awards” column of the table above for 2018, 2017 and 2016 reflect the aggregate fair value on the grant date of the stock awards granted to our named executive officers determined in accordance with FASB ASC Topic 718. The amounts reported in the “Long Term Incentive Plan” column of the table above for 2018, 2017 and 2016 reflect the target value of the award. The fair value on the grant date of the award is reported on page 29.
|
(2)
|
The amounts reported in the “All Other Compensation” column represent dividends paid on unvested shares, company contributions made during 2018 to each named executive officer’s 401(k) plan account, and certain insurance premiums paid by the Company.
|
(3)
|
Under Mr. Kriedberg’s retirement and transition agreement in September 2018, (a) the target shares for his original 2018 Long Term Incentive Plan Award were reduced by 1/3 and the performance period was shortened from three to two years and (b) he was to receive no 2018 Annual Equity Award and his 2018 Cash Target Bonus was increased from 100% to 125%. In lieu of a 2017 award under our long-term incentive plan, Mr. Kriedberg was given a special performance share award in March of 2017 in the amount of $1,499,993, conditioned upon achieving a minimum cash flow in 2017, which was satisfied in March 2018, to ensure his retention during our leadership transition.
|
(4)
|
On June 9, 2017, Messrs. Inglese, Dahlke and Chandran were promoted to Chief Executive Officer, Chief Financial officer and EVP Corporate Finance & Strategy.
|
(1)
|
The Summary Compensation Table values are comprised of the values from the SEC-required table on page 29 where Base Salary = Salary; Cash Bonus = Non-Equity Incentive Compensation; RSA = Annual Equity Award; LTIP = Long Term Incentive Plan; and Other = All Other Compensation of $110,288.
|
(2)
|
The Realized Pay values are comprised of Base Salary received in 2018; Actual Cash Bonus for 2018, paid in the first quarter of 2019; RSA is the dollar value of restricted share awards that vested during calendar year 2018; LTIP is the dollar value of our long-term incentive awards that vested during 2018; and Other is All Other Compensation from the SEC-required table on page 29.
|
|
|
|
|
|
|
|
|
Stock Awards (US$)
(1)
|
|
|
|
|
||||||||
Name and Principal Position
|
|
Fiscal
Year
|
|
Salary (US$)
|
|
Non-Equity Incentive Plan Compensation (US$)
|
|
Annual Equity Award
|
|
Long Term Incentive Plan
|
|
All Other Compensation (US$)
(2)
|
|
Total (US$)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Michael J. Inglese
|
|
2018
|
|
675,000
|
|
|
935,550
|
|
|
1,091,583
|
|
(3)
|
3,442,058
|
|
|
110,288
|
|
|
6,254,479
|
|
Chief Executive Officer
|
|
2017
|
|
673,077
|
|
|
716,580
|
|
|
797,762
|
|
|
1,672,656
|
|
|
87,388
|
|
|
3,947,463
|
|
(formerly Chief Financial Officer)
(5)
|
|
2016
|
|
541,667
|
|
|
595,540
|
|
|
516,004
|
|
|
874,074
|
|
|
80,179
|
|
|
2,607,464
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Aaron A. Dahlke
|
|
2018
|
|
400,000
|
|
|
554,400
|
|
|
312,330
|
|
(3)
|
755,710
|
|
|
32,874
|
|
|
2,055,314
|
|
Chief Financial Officer
|
|
2017
|
|
362,901
|
|
|
424,640
|
|
|
47,474
|
|
|
285,656
|
|
|
19,871
|
|
|
1,140,542
|
|
(formerly Chief Accounting Officer)
(5)
|
|
2016
|
|
300,000
|
|
|
242,428
|
|
|
84,678
|
|
|
127,145
|
|
|
21,230
|
|
|
775,481
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Michael L. Kriedberg
(4)
|
|
2018
|
|
600,000
|
|
|
1,039,500
|
|
|
749,463
|
|
(3)
|
1,013,759
|
|
|
131,595
|
|
|
3,534,317
|
|
Chief Commercial Officer
|
|
2017
|
|
562,500
|
|
|
636,960
|
|
|
367,976
|
|
|
1,613,655
|
|
|
155,787
|
|
|
3,336,878
|
|
|
|
2016
|
|
486,667
|
|
|
535,986
|
|
|
516,004
|
|
|
786,678
|
|
|
149,952
|
|
|
2,475,287
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Christopher L. Beers
|
|
2018
|
|
500,000
|
|
|
693,000
|
|
|
420,396
|
|
(3)
|
1,444,308
|
|
|
71,564
|
|
|
3,129,268
|
|
Chief Legal Officer & Secretary
|
|
2017
|
|
454,167
|
|
|
540,800
|
|
|
197,621
|
|
|
680,332
|
|
|
67,829
|
|
|
1,940,749
|
|
|
|
2016
|
|
400,000
|
|
|
395,222
|
|
|
365,726
|
|
|
580,082
|
|
|
71,898
|
|
|
1,812,928
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Roy Chandran
(5)
|
|
2018
|
|
400,000
|
|
|
562,400
|
|
|
312,330
|
|
(3)
|
761,238
|
|
|
34,944
|
|
|
2,070,912
|
|
EVP Corporate Finance & Strategy
(formerly EVP Capital Markets)
(5)
|
|
2017
|
|
395,833
|
|
|
424,640
|
|
|
74,426
|
|
|
256,941
|
|
|
24,386
|
|
|
1,176,226
|
|
(1)
|
The amounts reported in the Annual Equity Award column for 2018, 2017 and 2016 reflect the aggregate fair value on the grant date of the restricted share awards granted to our NEOs determined in accordance with FASB ASC Topic 718. The amounts reported in the Long-Term Incentive Plan column for 2018, 2017 and 2016 reflect the aggregate fair value on the grant date of the AROE PSUs and the TSR PSUs granted to our NEOs determined in accordance with FASB ASC Topic 718 based on the probable achievement of the applicable AROE and TSR performance conditions as of the grant date. The aggregate fair value on the grant date that would have been included for the AROE PSUs and TSR PSUs, assuming that the highest level of the performance conditions would be achieved, is as follows: Mr. Inglese US$5,700,000; Mr. Dahlke US$1,400,000; Mr. Kriedberg US$1,749,996 ; Mr. Beers US$2,300,000; and Mr. Chandran US$1,400,000. For a summary of the assumptions made in the valuation of these awards, please see Note 8 to our Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2018. See “Grants of Plan-Based Awards” below for additional information regarding restricted share awards and PSUs made to our NEOs in 2018, 2017 and 2016.
|
(2)
|
The amounts reported in this column consist of: (i) the following dividend payments made by the Company on unvested restricted common shares for each named executive officer in 2018: Mr. Inglese US$97,648; Mr. Dahlke US$20,234; Mr. Kriedberg US$118,784; Mr. Beers US$58,514; and Mr. Chandran US$22,304 and (ii) Company contributions made during 2018 to each named executive officer’s 401(k) plan account and certain insurance premiums paid by the Company.
|
(3)
|
Represents restricted share awards granted in 2018 in respect of performance for fiscal year 2017. Stock awards in respect of performance for fiscal year 2018 were approved by the Compensation Committee and communicated to the named executive officers in February 2019. The aggregate grant date fair value of restricted share awards in respect of performance in fiscal year 2018, which vest over three years and were communicated in February 2019 are as follows: Mr. Inglese US
$935,555
; Mr. Dahlke US
$277,204
; Mr. Kriedberg US
$0
; Mr. Beers US
$346,506
; and Mr. Chandran US
$281,192
.
|
(4)
|
Under Mr. Kriedberg’s Retirement and Transition Agreement, (a) the target shares for his original 2018 Long Term Incentive Plan Award were reduced by 1/3 and the performance period was shortened from three to two years and (b) he was to receive no 2018 Annual Equity Award and his 2018 Cash Target Bonus was increased from 100% to 125%. In lieu of a 2017 award under our long-term incentive plan, Mr. Kriedberg was given a special performance share award in March of 2017 in the amount of US$1,499,993, conditioned upon achieving a minimum cash flow in 2017, which was satisfied in March 2018, to ensure his retention during our leadership transition.
|
(5)
|
On June 9, 2017, Messrs. Inglese, Dahlke and Chandran were promoted to Chief Executive Officer, Chief Financial Officer and EVP Corporate Finance & Strategy.
|
Name and Grant Type
|
Grant Date
(1)
|
Estimated Future Payouts Under Non-Equity Incentive Plan Awards
|
Estimated Future Payouts Under Equity Incentive Plan Awards
(2)
|
|
All Other Stock Awards:
Number of
Shares of Stock or Units (#)
(1)
|
Grant Date Per Share Fair Value (US$)
(1)
|
Grant Date Fair Value
of Stock Awards
(US$)
(1)
|
|||||||||||
Threshold
(US$)
|
Target
(US$)
|
Maximum
(US$)
|
Threshold
(#)
|
Target
(#)
|
Maximum
(#)
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Michael J. Inglese
|
|
|
|
1,350,000
|
|
|
|
|
|
|
|
|
||||||
RSA
|
2/9/2018
|
|
|
|
|
|
|
|
50,677
|
|
21.54
|
|
1,091,583
|
|
||||
PSU TSR
|
2/9/2018
|
|
|
|
33,078
|
|
66,156
|
|
132,312
|
|
|
|
23.03
|
|
1,523,573
|
|
||
PSU AROE
|
2/9/2018
|
|
|
|
|
48,928
|
|
97,856
|
|
(3)
|
|
18.94 - 20.73
|
|
1,918,485
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Aaron A. Dahlke
|
|
|
|
800,000
|
|
|
|
|
|
|
|
|
||||||
RSA
|
2/9/2018
|
|
|
|
|
|
|
|
14,500
|
|
21.54
|
|
312,330
|
|
||||
PSU TSR
|
2/9/2018
|
|
|
|
8,125
|
|
16,249
|
|
32,498
|
|
|
|
23.03
|
|
374,214
|
|
||
PSU AROE
|
2/9/2018
|
|
|
|
|
9,798
|
|
19,596
|
|
(3)
|
|
18.94 - 20.73
|
|
381,495
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Michael L. Kriedberg
|
|
|
|
750,000
|
|
|
|
|
|
|
|
|
||||||
RSA
|
2/9/2018
|
|
|
|
|
|
|
|
34,794
|
|
21.54
|
|
749,463
|
|
||||
PSU TSR
|
2/9/2018
|
|
|
|
10,156
|
|
20,312
|
|
40,624
|
|
|
|
14.37
|
|
291,883
|
|
||
PSU AROE
|
2/9/2018
|
|
|
|
|
18,058
|
|
36,116
|
|
(3)
|
|
18.94 - 20.73
|
|
721,875
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Christopher L. Beers
|
|
|
|
1,000,000
|
|
|
|
|
|
|
|
|
||||||
RSA
|
2/9/2018
|
|
|
|
|
|
|
|
19,517
|
|
21.54
|
|
420,396
|
|
||||
PSU TSR
|
2/9/2018
|
|
|
|
13,348
|
|
26,695
|
|
53,390
|
|
|
|
23.03
|
|
614,786
|
|
||
PSU AROE
|
2/9/2018
|
|
|
|
|
21,038
|
|
42,076
|
|
(3)
|
|
18.94 - 20.73
|
|
829,522
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Roy Chandran
|
|
|
|
800,000
|
|
|
|
|
|
|
|
|
||||||
RSA
|
2/9/2018
|
|
|
|
|
|
|
|
14,500
|
|
21.54
|
|
312,330
|
|
||||
PSU TSR
|
2/9/2018
|
|
|
|
8,125
|
|
16,249
|
|
32,498
|
|
|
—
|
|
23.03
|
|
374,214
|
|
|
PSU AROE
|
2/9/2018
|
|
|
|
|
9,906
|
|
19,812
|
|
(3)
|
|
18.94 - 20.73
|
|
387,024
|
|
(1)
|
Represents restricted share awards granted in 2018 in respect of performance for fiscal year 2017. Stock awards in respect of performance for fiscal year 2018 were approved by the Compensation Committee and communicated to the named executive officers in February 2019. The aggregate grant date fair value of restricted share awards in respect of performance in fiscal year 2018, which vest over three years and were communicated in February 2019 are as follows: Mr. Inglese US
$935,555
; Mr. Dahlke US
$277,204
; Mr. Kriedberg US
$0
; Mr. Beers US
$346,506
; and Mr. Chandran US
$281,192
.
|
(2)
|
Represents PSUs granted in 2018 which were designed to align management with shareholders by rewarding exceptional performance over a three year period while enhancing retention for executives and certain senior professionals. All PSUs granted during 2018 vest and their performance period ends on December 31, 2020. The amounts reflect the aggregate fair value on the grant date of the PSUs granted to our named executive officers determined in accordance with FASB ASC Topic 718. For a summary of the assumptions made in the valuation of these awards, please see Note 8 to our Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2018.
|
(3)
|
The maximum AROE PSUs represent 200% of target based on actual performance against the February 2018 AROE target. The remaining 123,730 of target AROE PSUs will be considered granted upon the Compensation Committee’s setting the target AROE for the respective period.
|
|
|
Stock Awards
|
||||||||||
Name
|
|
Number of Shares
or Units of Stock
that Have
Not Vested (#)
|
|
Market Value of
Shares or Units of
Stock that Have
Not Vested (US$)
(1)
|
|
Equity Incentive Plan Awards; Number of Unearned Shares, Units or Other Rights that have Not Vested (#)
(7)
|
|
Equity Incentive Plan Awards; Market or Payout Value of Unearned Shares, Units or Other Rights that have Not Vested (US$)
(1)
|
||||
Michael J. Inglese
|
|
85,656
|
|
(2)
|
1,476,709
|
|
|
212,882
|
|
|
3,670,082
|
|
Aaron A. Dahlke
|
|
17,749
|
|
(3)
|
305,993
|
|
|
44,698
|
|
|
770,592
|
|
Michael L. Kriedberg
|
|
99,028
|
|
(4)
|
1,707,243
|
|
|
40,622
|
|
|
700,323
|
|
Christopher L. Beers
|
|
51,328
|
|
(5)
|
884,895
|
|
|
80,476
|
|
|
1,387,406
|
|
Roy Chandran
|
|
19,565
|
|
(6)
|
337,301
|
|
|
41,275
|
|
|
711,583
|
|
(1)
|
Valued at a common share price of US
$17.24
, the reported closing price for our common shares on the NYSE on December 31, 2018, the last trading day of 2018. PSUs were valued assuming achievement of the applicable performance metrics as described below in footnote 7.
|
(2)
|
These
85,656
restricted shares vest in increments of 39,963, 28,801 and 16,892 each January 1, commencing January 1, 2019.
|
(3)
|
These
17,749
restricted shares vest in increments of 7,374, 5,542 and 4,833 each January 1, commencing January 1, 2019.
|
(4)
|
These
99,028
restricted shares vest in increments of 28,252, 17,091 and 11,598 each January 1, commencing January 1, 2019 and 21,043 and 21,044 each March 31, commencing on March 31, 2019.
|
(5)
|
In connection with his appointment as our General Counsel in November 2014, Mr. Beers received a grant of 45,000 restricted common shares, vesting in one-fifth increments each January 1, commencing January 1, 2016. His total of
51,328
restricted shares vest in increments of 26,367, 18,455 and 6,506 each January 1, commencing January 1, 2019.
|
(6)
|
These
19,565
restricted shares vest in increments of 8,788, 5,944 and 4,833
each January 1, commencing January 1, 2019.
|
(7)
|
Represents the TSR PSUs at target and the AROE PSUs at maximum for AROE PSUs deemed granted in 2018 and 2017 determined in accordance with FASB ASC Topic 718. See “Grants of Plan-Based Awards for 2018” above for additional information regarding PSUs granted to our named executive officers in 2018. The remaining 123,730 of target AROE PSUs will be considered granted upon the Compensation Committee’s setting the target AROE for the respective period. For a summary of the assumptions made in the valuation of these awards, please see Note 8 to our Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2018. All performance share unit awards granted during 2016 vested and their performance period ended on December 31, 2018 (and are not included in this table, but in accordance with SEC Rules are reported in the “Stock Vested for 2018” table below), all performance share unit awards granted during 2017 vest and their performance period ends on December 31, 2019 and all performance share unit awards granted during 2018 vest and their performance period ends on December 31, 2020.
|
|
Stock Awards
|
|||
Name
|
Number of Shares
Acquired on Vesting (#)
|
Value Realized
on Vesting
(US$)
(1)(2)
|
||
Michael J. Inglese
|
72,604
|
|
1,580,935
|
|
Aaron A. Dahlke
|
9,311
|
|
200,726
|
|
Michael L. Kriedberg
|
119,545
|
|
2,616,328
|
|
Christopher L. Beers
|
44,723
|
|
968,244
|
|
Roy Chandran
|
14,603
|
|
314,909
|
|
(1)
|
The aggregate dollar value realized is calculated based on the US
$23.39
per share price of our common shares on December 31, 2017, the last business day preceding the vesting date, which was January 1, 2018, for Messrs. Inglese, Dahlke, Beers and Chandran. Mr. Kriedberg’s award was calculated based on the US
$23.39
per share price of our common shares on December 31, 2017, for US$1,527,624, which vested on January 1, 2018, and the US$19.86 per share price of our common shares on March 29, 2018, for US$417,934, which vested on March 30, 2018.
|
(2)
|
Includes the value realized upon vesting and settlement of the 2016 LTIP awards. The aggregate dollar value realized is calculated based on the US
$20.21
per share price of our common shares on February 21, 2019, the last business day preceding the delivery date, which was February 22, 2019, for Messrs. Inglese, Dahlke, Kriedberg, Beers and Chandran.
|
Circumstances of Termination
|
||||||||||||||
Name/Benefit
|
Voluntary
resignation
by
executive (US$)
|
Termination by us for
cause (US$)
|
Termination
by us
without
cause (US$)
|
Termination by us
without
cause or by executive for good reason following
change in
control (US$)
(1)
|
Termination
by
executive
for good
reason (US$)
|
Normal
retirement (US$)
|
Death or
Disability (US$)
|
|||||||
|
|
|
|
|
|
|
|
|||||||
Michael J. Inglese
|
|
|
|
|
|
|
|
|||||||
Cash Severance
|
—
|
|
—
|
|
1,350,000
|
|
2,700,000
|
|
1,350,000
|
|
—
|
|
—
|
|
Pro-rata Bonus
|
—
|
|
—
|
|
675,000
|
|
675,000
|
|
675,000
|
|
—
|
|
675,000
|
|
COBRA Reimbursement
|
—
|
|
—
|
|
45,420
|
|
45,420
|
|
45,420
|
|
—
|
|
45,420
|
|
Vacation
|
72,692
|
|
72,692
|
|
72,692
|
|
72,692
|
|
72,692
|
|
72,692
|
|
72,692
|
|
Market Value of Accelerated Vesting of Restricted Shares
|
—
|
|
—
|
|
1,476,709
|
|
1,476,709
|
|
1,476,709
|
|
—
|
|
1,476,709
|
|
Market Value of Accelerated Vesting of Performance Share Units
|
—
|
|
—
|
|
2,681,224
|
|
3,684,869
|
|
2,681,224
|
|
—
|
|
4,152,806
|
|
|
|
|
|
|
|
|
|
|||||||
Aaron A. Dahlke
|
|
|
|
|
|
|
|
|||||||
Cash Severance
|
—
|
|
—
|
|
800,000
|
|
1,600,000
|
|
800,000
|
|
—
|
|
—
|
|
Pro-rata Bonus
|
—
|
|
—
|
|
400,000
|
|
400,000
|
|
400,000
|
|
—
|
|
400,000
|
|
COBRA Reimbursement
|
—
|
|
—
|
|
45,420
|
|
45,420
|
|
45,420
|
|
—
|
|
45,420
|
|
Vacation
|
43,077
|
|
43,077
|
|
43,077
|
|
43,077
|
|
43,077
|
|
43,077
|
|
43,077
|
|
Market Value of Accelerated Vesting of Restricted Shares.
|
—
|
|
—
|
|
305,993
|
|
305,993
|
|
305,993
|
|
—
|
|
305,993
|
|
Market Value of Accelerated Vesting of Performance Share Units
|
—
|
|
—
|
|
612,371
|
|
801,177
|
|
612,371
|
|
—
|
|
881,481
|
|
|
|
|
|
|
|
|
|
|||||||
Michael L. Kriedberg
|
|
|
|
|
|
|
|
|||||||
Cash Severance
|
—
|
|
—
|
|
562,500
|
|
562,500
|
|
562,500
|
|
—
|
|
—
|
|
Pro-rata Bonus
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
COBRA Reimbursement
|
—
|
|
—
|
|
45,420
|
|
45,420
|
|
45,420
|
|
—
|
|
45,420
|
|
Vacation
|
64,615
|
|
64,615
|
|
64,615
|
|
64,615
|
|
64,615
|
|
64,615
|
|
64,615
|
|
Market Value of Accelerated Vesting of Restricted Shares.
|
—
|
|
—
|
|
1,707,243
|
|
1,707,243
|
|
1,707,243
|
|
—
|
|
1,707,243
|
|
Market Value of Accelerated Vesting of Performance Share Units
|
—
|
|
—
|
|
630,260
|
|
700,289
|
|
630,260
|
|
—
|
|
700,323
|
|
|
|
|
|
|
|
|
|
|||||||
Christopher L. Beers
|
|
|
|
|
|
|
|
|||||||
Cash Severance
|
—
|
|
—
|
|
1,000,000
|
|
2,000,000
|
|
1,000,000
|
|
—
|
|
—
|
|
Pro-rata Bonus
|
—
|
|
—
|
|
500,000
|
|
500,000
|
|
500,000
|
|
—
|
|
500,000
|
|
COBRA Reimbursement
|
—
|
|
—
|
|
45,420
|
|
45,420
|
|
45,420
|
|
—
|
|
45,420
|
|
Vacation
|
53,846
|
|
53,846
|
|
53,846
|
|
53,846
|
|
53,846
|
|
53,846
|
|
53,846
|
|
Market Value of Accelerated Vesting of Restricted Shares.
|
—
|
|
—
|
|
884,895
|
|
884,895
|
|
884,895
|
|
—
|
|
884,895
|
|
Market Value of Accelerated Vesting of Performance Share Units
|
—
|
|
—
|
|
1,056,924
|
|
1,410,185
|
|
1,056,924
|
|
—
|
|
1,573,460
|
|
|
|
|
|
|
|
|
|
|||||||
Roy Chandran
|
|
|
|
|
|
|
|
|||||||
Cash Severance
|
—
|
|
—
|
|
800,000
|
|
1,600,000
|
|
800,000
|
|
—
|
|
—
|
|
Pro-rata Bonus
|
—
|
|
—
|
|
400,000
|
|
400,000
|
|
400,000
|
|
—
|
|
400,000
|
|
COBRA Reimbursement
|
—
|
|
—
|
|
45,420
|
|
45,420
|
|
45,420
|
|
—
|
|
45,420
|
|
Vacation
|
43,077
|
|
43,077
|
|
43,077
|
|
43,077
|
|
43,077
|
|
43,077
|
|
43,077
|
|
Market Value of Accelerated Vesting of Restricted Shares.
|
—
|
|
—
|
|
337,301
|
|
337,301
|
|
337,301
|
|
—
|
|
337,301
|
|
Market Value of Accelerated Vesting of Performance Share Units
|
—
|
|
—
|
|
593,317
|
|
753,789
|
|
593,317
|
|
—
|
|
818,297
|
|
(1)
|
As described below, the total amount of payments for each named executive officer may be subject to reduction to the extent necessary to avoid an excise tax under Section 4999 of the Internal Revenue Code.
|
•
|
except with respect to Mr. Kriedberg, who will be entitled to receive certain severance payments and benefits pursuant to his Retirement and Transition Agreement (as discussed above) rather than his employment agreement (as described below), if the employment of such named executive officer is terminated without “cause” or with “good reason” (as defined in such employment agreement), and if he signs a general release of claims and complies with the covenants described below, then he will be entitled to receive: (i) an amount equal to the sum of the base salary and target annual cash bonus for the year of termination, payable over a one-year period (two times such amount and payable in a lump sum if the termination occurs within 120 days prior to or within two years following a “change in control” as defined in such employment agreement); (ii) a pro-rata annual bonus for the year of termination; (iii) reimbursement of COBRA premiums for up to twelve months; and (iv) accelerated vesting of all outstanding restricted share awards;
|
•
|
if any amounts to be paid to such named executive officer would constitute “excess parachute payments” subject to the excise tax imposed under Section 4999 of the Internal Revenue Code, the amount will be reduced to the extent necessary to avoid the excise tax, but only if such reduction results in a higher after-tax payment to him; and
|
•
|
such named executive officer covenants not to compete with Aircastle for six months following termination of his employment for any reason and will not solicit the employees of Aircastle or the clients or customers of Aircastle for competing business, in each case, for a period of twelve months following termination.
|
•
|
if his employment is terminated without “cause” or with “good reason” (as defined in his employment agreement), in lieu of the severance entitlements provided in his employment agreement, Mr. Kriedberg will be entitled to receive the compensation that he would have received under the Retirement and Transition Agreement had he remained employed through the Retirement Date, on January 1, 2020, plus Company-paid COBRA benefits from the date of such termination of employment through December 31, 2020; and
|
•
|
the post-employment non-compete provisions of Mr. Kriedberg’s employment agreement continue to apply provided that beginning on the date that is three months after his termination of employment, he will be permitted to serve as a board member to (i) any commercial jet aircraft leasing business (x) that is an investment vehicle with portfolios managed by third parties or (y) having an owned and/or managed portfolio of less than $1.5 billion and (ii) any vehicles which own commercial aircraft that are managed/serviced by others. In addition, for a period of twelve months after the termination of his employment, Mr. Kriedberg may not be employed in a senior commercial role in any business in the commercial jet aircraft leasing business or any other business which constitutes a material part of the Company’s business as of the termination date.
|
Plan Category
|
|
Number of securities
to be issued upon
exercise of outstanding
options, warrants
and rights
|
|
Weighted-average
exercise price of
outstanding options,
warrants and rights
|
|
Number of securities
remaining available for
future issuance under
equity compensation plans (excluding securities
reflected in column (a))
|
||||
|
|
(a)
|
|
(b)
|
|
(c)
|
||||
Equity compensation plans approved by security holders
|
|
1,061,033
|
|
(1)
|
$
|
—
|
|
|
5,220,284
|
|
Equity compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
|
|
|
|
5,220,284
|
|
(1)
|
Represents 1,061,033 common shares subject to outstanding PSU awards (assuming payout at maximum), noting that the maximum payout for the 2017 AROE PSU was established at 70% of target for the March 21, 2017, awards, 65% of target for the June 9, 2017 awards and 200% of target for the 2018 AROE PSU awards.
|
Name
|
|
Age
|
|
Position
|
Ronald W. Allen
|
|
77
|
|
Class I Director
|
Douglas A. Hacker
|
|
63
|
|
Class I Director
|
Jun Horie
|
|
55
|
|
Class I Director
|
Michael J. Inglese
|
|
58
|
|
Class I Director
|
|
2018
(US$)
|
2017
(US$)
|
||
Audit Fees
(1)
|
2,015,000
|
|
2,199,440
|
|
Audit-Related Fees
(2)
|
—
|
|
—
|
|
Tax Fees
(3)
|
646,000
|
|
604,296
|
|
All Other Fees
|
3,600
|
|
3,300
|
|
(1)
|
Represents fees for the audit of the Company’s consolidated financial statements and internal control over financial reporting, the reviews of interim financial statements included in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, certain Current Reports on Form 8-K, audits of IBJ Air joint venture, consultations concerning financial accounting and reporting standards, statutory audits and services rendered relating to the Company’s registration statements.
|
(2)
|
Represents fees related primarily to account for potential acquisitions.
|
(3)
|
Represents fees related primarily to assistance with tax compliance matters, including international, federal and state tax return preparation, and consultations regarding tax matters.
|
•
|
Achievement of corporate financial metrics, focused on operational and financial performance, in the form of adjusted return on equity, cash flow per share, and sustainable growth through new investments.
|
•
|
Achievement of individualized performance goals set at the beginning of each year.
|
|
Christopher L. Beers
|
Chief Legal Officer & Secretary
|
(Dollars in thousands)
|
Year Ended
December 31, 2018
|
||
Net income
|
$
|
247,919
|
|
Gain on mark-to-market of interest rate derivative contracts
|
(1,632
|
)
|
|
Loan termination payment
|
(838
|
)
|
|
Write-off of deferred financing fees
|
300
|
|
|
Stock compensation expense
|
11,488
|
|
|
Adjusted net income
|
$
|
257,237
|
|
|
|
||
2018 Average shareholders’ equity
|
$
|
1,967,059
|
|
Adjusted return on equity
|
13.08
|
%
|
(Dollars and weighted average shares in thousands)
|
Year Ended
December 31, 2018
|
||
Net cash provided by operating activities
|
$
|
522,592
|
|
Add back:
Changes on certain assets and liabilities:
|
|
||
Accounts receivable
|
12,328
|
|
|
Other assets
|
(5,065
|
)
|
|
Accounts payable, accrued expenses and other liabilities
|
(10,526
|
)
|
|
Lease rentals received in advance
|
(32,868
|
)
|
|
Cash flow from operations before working capital
|
486,461
|
|
|
Collections on finance leases
|
33,861
|
|
|
Cash flow
|
$
|
520,322
|
|
|
|
||
Cash flow per share
|
$
|
6.65
|
|
Weighted average shares
|
78,225
|
|
(Dollars in thousands)
|
|
|
|
|
|||||||||||||||||||||
Quarter
|
|
Lease Rental Revenue
|
|
Cash Interest Expense
|
|
Net Cash Interest Margin
|
|
Average NBV of Flight Equipment
|
|
Annualized Lease Rental Yield
(1)
|
|
Annualized Cash Interest / Average NBV of Flight Equipment
|
|
Annualized Net Cash Interest Margin
(2)
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Q4 2018
|
|
|
$200,027
|
|
|
|
$60,348
|
|
|
|
$139,679
|
|
|
|
$7,136,627
|
|
|
11.2
|
%
|
|
3.4
|
%
|
|
7.8
|
%
|
(1)
|
Lease rental yield is defined as operating and finance and sales-type lease rental revenue plus finance and sales-type lease collections divided by average monthly net book value (including finance and sales-type leases) for the period calculated on a quarterly basis, annualized.
|
(2)
|
Net cash interest margin is defined as lease rentals from operating leases, interest income and cash collections from finance and sales-type leases minus interest on borrowings, net settlements on interest rate derivatives and other liabilities adjusted for loan termination payments divided by the average net book of flight equipment (which includes net investment on finance and sales-type leases) for the period calculated on a quarterly and annualized basis.
|
1.
|
Election of Directors: Nominees: Ronald W. Allen, Douglas A. Hacker, Jun Horie and Michael J. Inglese.
|
FOR all nominees [ ]
|
WITHHOLD AUTHORITY [ ]
to vote for all nominees
|
FOR all nominees,
EXCEPT [ ]
|
Write-In Nominee
|
|
|
|
|
FOR [ ]
|
AGAINST [ ]
|
ABSTAIN [ ]
|
FOR [ ]
|
AGAINST [ ]
|
ABSTAIN [ ]
|
Change of Address and/
|
I PLAN TO ATTEND ANNUAL MEETING. If you
|
or Comments Mark Here [ ]
|
check this box to the right an admission
|
|
ticket will be sent to you. [ ]
|
(Please sign, date and return this
|
Votes MUST be indicated
|
proxy card in the enclosed envelope.)
|
in black or blue ink. [ x ]
|