SECURITIES AND EXCHANGE COMMISSION
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Delaware | 7359 | 27-1840403 | ||
(State or other jurisdiction | (Primary Standard Industrial | (I.R.S. Employer | ||
of incorporation or organization) | Classification Code Number) | Identification Number) |
Grant A. Levy | Robert B. Knauss, Esq. | |
Executive Vice President, | Mark H. Kim, Esq. | |
General Counsel & Secretary | Munger, Tolles & Olson LLP | |
Air Lease Corporation | 355 South Grand Avenue, 35th Floor | |
2000 Avenue of the Stars, Suite 1000N | Los Angeles, CA 90071 | |
Los Angeles, CA 90067 | (213) 683-9100 | |
(310) 553-0555 |
Large accelerated filero | Accelerated filero | Non-accelerated filerþ | Smaller reporting companyo | |||
(Do not check if a smaller reporting company) |
Proposed Maximum | Proposed Maximum | |||||||||||||||||||||
Title of Each Class of | Amount to be | Offering Price Per | Aggregate Offering | Amount of | ||||||||||||||||||
Securities to be Registered | Registered | Share(1) | Price(1) | Registration Fee | ||||||||||||||||||
Class A Common Stock, par value $0.01 per share | 61,810,867 | $ | 28.16 | $ | 1,740,594,015 | $ | 202,083 | (2) | ||||||||||||||
Class B Non-Voting Common Stock, par value $0.01 per share | 1,829,339 | $ | 28.16 | $ | 51,514,187 | $ | 5,981 | (3) | ||||||||||||||
(1) | Estimated solely for the purpose of calculating the amount of the registration fee pursuant to Rule 457(c) under the Securities Act of 1933, as amended, and based on the average of the high and low prices of the Registrant’s Class A Common Stock on April 28, 2011 as reported on the New York Stock Exchange. The Registrant’s Class B Non-Voting Common Stock is not currently listed on any national securities exchange or market system. The Registrant treats the Class A Common Stock and the Class B Non-Voting Common Stock equally and identically, except with respect to voting rights and conversion rights. Accordingly, for both classes of common stock, the Registrant is using the offering price per share of the Class A Common Stock calculated in the manner described above. | |
(2) | $215,296 previously paid. | |
(3) | $5,981 previously paid. | |
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Aircraft Type | 2011 | (1) | 2012 | 2013 | 2014 | 2015 | Thereafter | Total | ||||||||||||||||||||
Airbus A319-100 | 1 | 1 | ||||||||||||||||||||||||||
Airbus A320/321-200 | 5 | 10 | 13 | 12 | 7 | 47 | ||||||||||||||||||||||
Airbus A320/321 NEO(2)(3) | 50 | 50 | ||||||||||||||||||||||||||
Airbus A330-200/300 | 6 | 6 | 12 | |||||||||||||||||||||||||
Boeing 737-700 | 2 | 2 | ||||||||||||||||||||||||||
Boeing 737-800(2) | 2 | 3 | 12 | 12 | 14 | 37 | 80 | |||||||||||||||||||||
Boeing 767-300ER | 2 | 2 | ||||||||||||||||||||||||||
Boeing 777-300ER(3) | 2 | 3 | 5 | |||||||||||||||||||||||||
Boeing 787-9(3) | 4 | 4 | ||||||||||||||||||||||||||
Embraer E175/190 | 11 | 19 | 30 | |||||||||||||||||||||||||
ATR 72-600 | 2 | 8 | 10 | |||||||||||||||||||||||||
Total | 31 | 46 | 25 | 26 | 24 | 91 | 243 | |||||||||||||||||||||
(1) | Of the 31 aircraft that we will acquire in the remainder of 2011, the following nine aircraft will be used aircraft: the Airbus A319-100, one Airbus A320-200, one Airbus A330-200, both Boeing 737-700s, both Boeing 737-800s and both Boeing 767-300ERs. | |
(2) | We have cancellation rights with respect to 14 of the Airbus A320/321 NEO aircraft and four of the Boeing 737-800 aircraft. | |
(3) | As of June 30, 2011, all of the Airbus A320/321 NEO aircraft, the Boeing 777-300ER aircraft and the Boeing 787-9 aircraft were subject to non-binding memoranda of understanding for the purchase of these aircraft. | |
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• | We are a recently organized corporation with a brief operating history and, therefore, we have limited historical operating data from which you can evaluate our future prospects. |
• | The success of our business will depend on our ability to identify high-quality commercial aircraft to acquire at reasonable prices. |
• | Failure to close our aircraft acquisition commitments could negatively impact our share price and financial results. |
• | Our business model depends on the continual leasing and re-leasing of our aircraft, and we may not be able to do so on favorable terms, if at all. |
• | Our credit facilities may limit our operational flexibility, our ability to effectively compete and our ability to grow our business as currently planned. |
• | We will need additional capital to finance our growth, and we may not be able to obtain it on terms acceptable to us, or at all, which may limit our ability to satisfy our commitments to acquire additional aircraft and to compete effectively in the commercial aircraft leasing market. |
• | Changes in interest rates may adversely affect our financial results. |
• | We have a high airline customer concentration, which makes us more vulnerable to the potential that defaults by one or more of our major airline customers would have a material adverse effect on our cash flow and earnings and our ability to meet our debt obligations. |
• | We may be indirectly subject to many of the economic and political risks associated with emerging markets, which could adversely affect our financial results and growth prospects. |
• | From time to time, the aircraft industry has experienced periods of oversupply during which lease rates and aircraft values have declined, and any future oversupply could materially adversely affect our financial results and growth prospects. |
• | Increases in fuel costs could materially adversely affect our lessees and by extension the demand for our aircraft. |
• | A deterioration in the financial condition of the airline industry would have an adverse impact on our ability to lease our aircraft and sustain our revenues. |
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Class A Common Stock offered by the selling stockholders | 61,810,867 shares | |
Class B Non-Voting Common Stock offered by the selling stockholders | 1,829,339 shares | |
Total Common Stock outstanding prior to and after this offering | 100,714,470 shares | |
Use of proceeds | We will not receive any proceeds from the sale of Common Stock by the selling stockholders. See “Use of proceeds.” | |
Dividend policy | We have no current plans to declare or pay any dividends on our Common Stock. See “Dividend policy.” | |
Voting rights | The holders of Class A Common Stock possess all voting power for the election of our directors and all other matters requiring stockholder action, except with respect to amendments to our restated certificate of incorporation that alter or change the powers, preferences, rights or other terms of any outstanding preferred stock if the holders of such affected series of preferred stock are entitled to vote on such an amendment. Holders of our Class A Common Stock are entitled to one vote for each share held and will not have cumulative voting rights in connection with the election of directors. Holders of Class B Non-Voting Common Stock are not entitled to any vote, other than with respect to amendments to the terms of the Class B Non-Voting Common Stock that would significantly and adversely affect the rights or preferences of the Class B Non-Voting Common Stock, including, without limitation, with respect to the convertibility thereof. See “Description of capital stock.” | |
Risk factors | See “Risk factors” for a discussion of certain factors you should consider before deciding to invest in our Common Stock. |
• | 482,625 shares of Common Stock issuable upon the exercise of warrants outstanding as of June 30, 2011 at an exercise price of $20.00 per share; | |
• | 3,225,908 shares of Class A Common Stock issuable upon the exercise of options outstanding as of June 30, 2011 at an exercise price of $20.00 per share; | |
• | 150,000 shares of Class A Common Stock issuable upon the exercise of options outstanding as of June 30, 2011 at an exercise price of $28.80 per share; and | |
• | 2,613,989 shares of Class A Common Stock issuable upon the vesting of restricted stock units outstanding as of June 30, 2011. | |
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For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | months ended | from Inception to | from Inception to | |||||||||||||||||
(in thousands, except share data) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
Operating data: | ||||||||||||||||||||
Rentals of flight equipment | $ | 74,004 | $ | 1,235 | $ | 128,616 | $ | 1,235 | $ | 57,075 | ||||||||||
Interest and other | 340 | 474 | 943 | 474 | 1,291 | |||||||||||||||
Total revenues | 74,344 | 1,709 | 129,559 | 1,709 | 58,366 | |||||||||||||||
Expenses | 63,456 | 46,852 | 113,746 | 47,329 | 119,281 | |||||||||||||||
Income (loss) before taxes | 10,888 | (45,143 | ) | 15,813 | (45,620 | ) | (60,915 | ) | ||||||||||||
Income tax (expense) benefit | (3,865 | ) | 4,002 | (5,614 | ) | 4,002 | 8,875 | |||||||||||||
Net income (loss) | $ | 7,023 | $ | (41,141 | ) | $ | 10,199 | $ | (41,618 | ) | $ | (52,040 | ) | |||||||
Income (loss) per share: | ||||||||||||||||||||
Basic | $ | 0.08 | $ | (2.37 | ) | $ | 0.13 | $ | (4.17 | ) | $ | (1.32 | ) | |||||||
Diluted | $ | 0.08 | $ | (2.37 | ) | $ | 0.13 | $ | (4.17 | ) | $ | (1.32 | ) | |||||||
Weighted average shares outstanding: | ||||||||||||||||||||
Basic | 91,039,329 | 17,394,121 | 78,287,085 | 9,981,375 | 39,511,045 | |||||||||||||||
Diluted | 91,163,657 | 17,394,121 | 78,408,463 | 9,981,375 | 39,511,045 | |||||||||||||||
Other financial data: | ||||||||||||||||||||
Adjusted net income (loss)(1) | $ | 19,459 | $ | (3,315 | ) | $ | 31,172 | $ | (3,792 | ) | $ | 2,520 | ||||||||
Adjusted EBITDA(2) | $ | 62,780 | $ | 3,550 | $ | 108,029 | $ | 3,073 | $ | 32,973 | ||||||||||
Balance sheet data: | ||||||||||||||||||||
Flight equipment subject to operating leases (net of accumulated depreciation) | $ | 2,814,926 | $ | 319,258 | $ | 2,814,926 | $ | 319,258 | $ | 1,629,809 | ||||||||||
Total assets | 3,753,499 | 1,159,859 | 3,753,499 | 1,159,859 | 2,276,282 | |||||||||||||||
Total debt | 1,383,570 | 25,000 | 1,383,570 | 25,000 | 911,981 | |||||||||||||||
Total liabilities | 1,627,151 | 43,719 | 1,627,151 | 43,719 | 1,051,347 | |||||||||||||||
Shareholders’ equity | 2,126,348 | 1,116,140 | 2,126,348 | 1,116,140 | 1,224,935 | |||||||||||||||
Cash flow data: | ||||||||||||||||||||
Net cash flows from: | ||||||||||||||||||||
Operating activities | $ | 48,483 | $ | 209 | $ | 87,032 | $ | 2,019 | $ | 45,124 | ||||||||||
Investing activities | (759,446 | ) | (331,351 | ) | (1,371,323 | ) | (335,601 | ) | (1,854,710 | ) | ||||||||||
Financing activities | 925,688 | 1,087,752 | 1,400,508 | 1,090,443 | 2,138,407 | |||||||||||||||
Other operating data: | ||||||||||||||||||||
Aircraft lease portfolio at period end: | ||||||||||||||||||||
Owned(3) | 65 | 8 | 65 | 8 | 40 | |||||||||||||||
(1) | Adjusted net income (loss) (defined as net income before stock-based compensation expense and non-cash interest expense, which includes the amortization of debt issuance costs and convertible debt discounts) is a measure of both operating performance and liquidity that is not defined by United States generally accepted accounting principles (“GAAP”) and should not be considered as an alternative to net income, income from operations or any other performance measures derived in accordance with GAAP. Adjusted net income is presented as a supplemental disclosure because management believes that it may be a useful performance measure that is used within our industry. We believe adjusted net income provides useful information on our earnings from ongoing operations, our ability to service our long-term debt and other fixed obligations, and our ability to fund our expected growth with internally generated funds. Set forth below is additional detail as to how |
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we use adjusted net income as a measure of both operating performance and liquidity, as well as a discussion of the limitations of adjusted net income as an analytical tool and a reconciliation of adjusted net income to our GAAP net loss and cash flow from operating activities. | ||
Operating Performance: Management and our board of directors use adjusted net income in a number of ways to assess our consolidated financial and operating performance, and we believe this measure is helpful in identifying trends in our performance. We use adjusted net income as a measure of our consolidated operating performance exclusive of income and expenses that relate to the financing, income taxes, and capitalization of the business. Also, adjusted net income assists us in comparing our operating performance on a consistent basis as it removes the impact of our capital structure (primarily one-time amortization of convertible debt discounts) and stock-based compensation expense from our operating results. In addition, adjusted net income helps management identify controllable expenses and make decisions designed to help us meet our current financial goals and optimize our financial performance. Accordingly, we believe this metric measures our financial performance based on operational factors that we can influence in the short term, namely the cost structure and expenses of the organization. | ||
Liquidity: In addition to the uses described above, management and our board of directors use adjusted net income as an indicator of the amount of cash flow we have available to service our debt obligations, and we believe this measure can serve the same purpose for our investors. | ||
Limitations: Adjusted net income has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our operating results or cash flows as reported under GAAP. Some of these limitations are as follows: | ||
• | adjusted net income does not reflect (i) our cash expenditures or future requirements for capital expenditures or contractual commitments, or (ii) changes in or cash requirements for our working capital needs; and | ||
• | our calculation of adjusted net income may differ from the adjusted net income or analogous calculations of other companies in our industry, limiting its usefulness as a comparative measure. |
The following tables show the reconciliation of net income (loss) and cash flows from operating activities, the most directly comparable GAAP measures of performance and liquidity, to adjusted net income: | ||
For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | months ended | from Inception to | from Inception to | |||||||||||||||||
(in thousands) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
Reconciliation of cash flows from operating activities to adjusted net income (loss): | ||||||||||||||||||||
Net cash provided by operating activities | $ | 48,483 | $ | 209 | $ | 87,032 | $ | 2,019 | $ | 45,124 | ||||||||||
Depreciation of flight equipment | (24,644 | ) | (327 | ) | (42,774 | ) | (327 | ) | (19,262 | ) | ||||||||||
Stock-based compensation | (11,753 | ) | (2,255 | ) | (22,660 | ) | (2,255 | ) | (24,044 | ) | ||||||||||
Deferred taxes | (3,866 | ) | 4,002 | (5,614 | ) | 4,002 | 8,875 | |||||||||||||
Amortization of deferred debt issue costs | (2,336 | ) | (875 | ) | (4,664 | ) | (875 | ) | (4,883 | ) | ||||||||||
Extinguishment of debt | (3,349 | ) | — | (3,349 | ) | — | — | |||||||||||||
Amortization of convertible debt discounts | — | (35,798 | ) | — | (35,798 | ) | (35,798 | ) | ||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||||||
Lease receivables and other assets | 14,042 | 1,094 | 16,327 | 1,199 | 8,040 | |||||||||||||||
Accrued interest and other payables | (5,904 | ) | (5,032 | ) | (6,932 | ) | (7,424 | ) | (22,054 | ) | ||||||||||
Rentals received in advance | (3,650 | ) | (2,159 | ) | (7,167 | ) | (2,159 | ) | (8,038 | ) | ||||||||||
Net income (loss) | 7,023 | (41,141 | ) | 10,199 | (41,618 | ) | (52,040 | ) | ||||||||||||
Amortization of debt issue costs | 2,336 | 875 | 4,664 | 875 | 4,883 | |||||||||||||||
Extinguishment of debt | 3,349 | — | 3,349 | — | — | |||||||||||||||
Amortization of convertible debt discounts | — | 35,798 | — | 35,798 | 35,798 | |||||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | 24,044 | |||||||||||||||
Tax effect | (5,002 | ) | (1,102 | ) | (9,700 | ) | (1,102 | ) | (10,165 | ) | ||||||||||
Adjusted net income (loss) | $ | 19,459 | $ | (3,315 | ) | $ | 31,172 | $ | (3,792 | ) | $ | 2,520 | ||||||||
For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | monthsended | from Inception to | from Inception to | |||||||||||||||||
(in thousands) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
Reconciliation of net income (loss) to adjusted net income (loss): | ||||||||||||||||||||
Net income (loss) | $ | 7,023 | $ | (41,141 | ) | $ | 10,199 | $ | (41,618 | ) | $ | (52,040 | ) | |||||||
Amortization of debt issue costs | 2,336 | 875 | 4,664 | 875 | 4,883 | |||||||||||||||
Extinguishment of debt | 3,349 | — | 3,349 | — | — | |||||||||||||||
Amortization of convertible debt discounts | — | 35,798 | — | 35,798 | 35,798 | |||||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | 24,044 | |||||||||||||||
Tax effect | (5,002 | ) | (1,102 | ) | (9,700 | ) | (1,102 | ) | (10,165 | ) | ||||||||||
Adjusted net income (loss) | $ | 19,459 | $ | (3,315 | ) | $ | 31,172 | $ | (3,792 | ) | $ | 2,520 | ||||||||
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(2) | Adjusted EBITDA (defined as net loss before net interest expense, stock-based compensation expense, income tax expense (benefit), and depreciation and amortization expense) is a measure of both operating performance and liquidity that is not defined by GAAP and should not be considered as an alternative to net income, income from operations or any other performance measures derived in accordance with GAAP. Adjusted EBITDA is presented as a supplemental disclosure because management believes that it may be a useful performance measure that is used within our industry. We believe adjusted EBITDA provides useful information on our earnings from ongoing operations, our ability to service our long-term debt and other fixed obligations, and our ability to fund our expected growth with internally generated funds. Set forth below is additional detail as to how we use adjusted EBITDA as a measure of both operating performance and liquidity, as well as a discussion of the limitations of adjusted EBITDA as an analytical tool and a reconciliation of adjusted EBITDA to our GAAP net loss and cash flow from operating activities. | |
Operating Performance: Management and our board of directors use adjusted EBITDA in a number of ways to assess our consolidated financial and operating performance, and we believe this measure is helpful in identifying trends in our performance. We use adjusted EBITDA as a measure of our consolidated operating performance exclusive of income and expenses that relate to the financing, income taxes, and capitalization of the business. Also, adjusted EBITDA assists us in comparing our operating performance on a consistent basis as it removes the impact of our capital structure (primarily one-time amortization of convertible debt discounts) and stock-based compensation expense from our operating results. In addition, adjusted EBITDA helps management identify controllable expenses and make decisions designed to help us meet our current financial goals and optimize our financial performance. Accordingly, we believe this metric measures our financial performance based on operational factors that we can influence in the short term, namely the cost structure and expenses of the organization. | ||
Liquidity: In addition to the uses described above, management and our board of directors use adjusted EBITDA as an indicator of the amount of cash flow we have available to service our debt obligations, and we believe this measure can serve the same purpose for our investors. | ||
Limitations: Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our operating results or cash flows as reported under GAAP. Some of these limitations are as follows: | ||
• | adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments; | ||
• | adjusted EBITDA does not reflect changes in or cash requirements for our working capital needs; | ||
• | adjusted EBITDA does not reflect interest expense or cash requirements necessary to service interest or principal payments on our debt; and | ||
• | other companies in our industry may calculate these measures differently from how we calculate these measures, limiting their usefulness as comparative measures. |
The following tables show the reconciliation of net income (loss) and cash flows from operating activities, the most directly comparable GAAP measures of performance and liquidity, to adjusted EBITDA: |
For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | monthsended | from Inception to | from Inception to | |||||||||||||||||
(in thousands) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
Reconciliation of cash flows from operating activities to adjusted EBITDA: | ||||||||||||||||||||
Net cash provided by operating activities | $ | 48,483 | $ | 209 | $ | 87,032 | $ | 2,019 | $ | 45,124 | ||||||||||
Depreciation of flight equipment | (24,644 | ) | (327 | ) | (42,774 | ) | (327 | ) | (19,262 | ) | ||||||||||
Stock-based compensation | (11,753 | ) | (2,255 | ) | (22,660 | ) | (2,255 | ) | (24,044 | ) | ||||||||||
Deferred taxes | (3,866 | ) | 4,002 | (5,614 | ) | 4,002 | 8,875 | |||||||||||||
Amortization of deferred debt issue costs | (2,336 | ) | (875 | ) | (4,664 | ) | (875 | ) | (4,883 | ) | ||||||||||
Extinguishment of debt | (3,349 | ) | — | (3,349 | ) | — | — | |||||||||||||
Amortization of convertible debt discounts | — | (35,798 | ) | — | (35,798 | ) | (35,798 | ) | ||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||||||
Lease receivables and other assets | 14,042 | 1,094 | 16,327 | 1,199 | 8,040 | |||||||||||||||
Accrued interest and other payables | (5,904 | ) | (5,032 | ) | (6,932 | ) | (7,424 | ) | (22,054 | ) | ||||||||||
Rentals received in advance | (3,650 | ) | (2,159 | ) | (7,167 | ) | (2,159 | ) | (8,038 | ) | ||||||||||
Net income (loss) | 7,023 | (41,141 | ) | 10,199 | (41,618 | ) | (52,040 | ) | ||||||||||||
Net interest expense | 15,495 | 38,107 | 26,782 | 38,107 | 50,582 | |||||||||||||||
Income taxes | 3,865 | 4,002 | 5,614 | 4,002 | (8,875 | ) | ||||||||||||||
Depreciation | 24,644 | 327 | 42,774 | 327 | 19,262 | |||||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | 24,044 | |||||||||||||||
Adjusted EBITDA | $ | 62,780 | $ | 3,550 | $ | 108,029 | $ | 3,073 | $ | 32,973 | ||||||||||
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For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | monthsended | from Inception to | from Inception to | |||||||||||||||||
(in thousands) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
Reconciliation of net income (loss) to adjusted EBITDA: | ||||||||||||||||||||
Net income (loss) | $ | 7,023 | $ | (41,141 | ) | $ | 10,199 | $ | (41,618 | ) | $ | (52,040 | ) | |||||||
Net interest expense | 15,495 | 38,107 | 26,782 | 38,107 | 50,582 | |||||||||||||||
Income taxes | 3,865 | 4,002 | 5,614 | 4,002 | (8,875 | ) | ||||||||||||||
Depreciation | 24,644 | 327 | 42,774 | 327 | 19,262 | |||||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | 24,044 | |||||||||||||||
Adjusted EBITDA | $ | 62,780 | $ | 3,550 | $ | 108,029 | $ | 3,073 | $ | 32,973 | ||||||||||
(3) | As of June 30, 2011, we owned 65 aircraft (of which 13 were new aircraft and 52 were used aircraft) and we managed one aircraft. As of December 31, 2010, we owned 40 aircraft of which four were new aircraft and 36 were used aircraft. | |
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• | impair our liquidity by using a significant portion of our available cash or borrowing capacity to finance the acquisition of aircraft; |
• | significantly increase our interest expense and financial leverage to the extent we incur additional debt to finance the acquisition of aircraft; or |
• | incur or assume unanticipated liabilities, losses or costs associated with the aircraft or other aviation assets that we acquire. |
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• | forfeiting deposits and progress payments and having to pay and expense certain significant costs relating to these commitments, such as actual damages, and legal, accounting and financial advisory expenses, and not realizing any of the benefits of completing the transactions; |
• | defaulting on our lease commitments, which could result in monetary damages and damage to our reputation and relationships with lessees; and |
• | failing to capitalize on other aircraft acquisition opportunities that were not pursued due to our management’s focus on these commitments. |
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• | general market conditions; |
• | the market’s view of the quality of our assets; |
• | the market’s perception of our growth potential; |
• | interest rate fluctuations; |
• | our current and potential future earnings and cash distributions; and |
• | the market price of our Class A Common Stock. |
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• | Mitsubishi Aircraft Corporation in Japan, Sukhoi Company (JSC) in Russia and Aviation Industries of China and Commercial Aircraft Corporation of China Ltd. in China will most likely be producing regional jets in the future that compete with existing equipment from Bombardier and Embraer, and it is unclear how these offerings could adversely impact the demand and liquidity for the current offerings. |
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• | Additionally, manufacturers in China may develop a narrowbody aircraft that competes with established aircraft types from Boeing and Airbus, and the new Chinese product could put downward price pressure on and decrease the liquidity for aircraft from Boeing and Airbus. |
• | New aircraft types that are introduced into the market could be more attractive for the target lessees of our aircraft. |
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• | competition; |
• | fare levels; |
• | passenger and air cargo rates; |
• | passenger and air cargo demand; |
• | geopolitical and other events, including war, acts of terrorism, outbreaks of epidemic diseases and natural disasters; |
• | increases in operating costs, including the price and availability of jet fuel and labor costs; |
• | labor difficulties; |
• | economic conditions and currency fluctuations in the countries and regions in which the lessee operates; and |
• | governmental regulation and associated fees affecting the air transportation business. |
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• | difficulty or inability to finance obligations for, or to finance a portion of, the acquisition of aircraft; |
• | increased risk of default by our lessees resulting from financial market distress, lack of available credit or continuing effects of the global economic recession; |
• | exposure to increased bank or counterparty risk in the current environment, including the risk that our counterparties will not be able to perform their obligations under contracts effectively locking in interest rates for our debt that has a floating interest rate feature and the risk that, if banks issue letters of credit to us in lieu of cash security deposits from our lessees, such banks may fail to pay when we seek to draw on these letters of credit; and |
• | the risk that we will not be able to re-finance any of our debt financings, as they come due, on favorable terms or at all. |
27
28
• | passenger and air cargo demand; |
• | fuel costs and general economic conditions; |
29
• | geopolitical events, including war, prolonged armed conflict and acts of terrorism; |
• | outbreaks of communicable diseases and natural disasters; |
• | governmental regulation; |
• | interest rates; |
• | the availability of credit; |
• | airline restructurings and bankruptcies; |
• | manufacturer production levels and technological innovation; |
• | manufacturers merging or exiting the industry or ceasing to produce aircraft types; |
• | retirement and obsolescence of aircraft models; |
• | reintroduction into service of aircraft previously in storage; and |
• | airport and air traffic control infrastructure constraints. |
• | the particular maintenance, operating history and documentary records of the aircraft; |
• | the number of operators using that type of aircraft; |
• | aircraft age; |
• | the regulatory authority under which the aircraft is operated; |
• | any renegotiation of an existing lease on less favorable terms; |
• | the negotiability of clear title free from mechanics’ liens and encumbrances; |
30
• | any regulatory and legal requirements that must be satisfied before the aircraft can be purchased, sold or re-leased; |
• | compatibility of aircraft configurations or specifications with other aircraft owned by operators of that type; |
• | comparative value based on newly manufactured competitive aircraft; and |
• | the availability of spare parts. |
• | airlines; |
• | financial institutions; |
• | aircraft brokers; |
• | public and private partnerships, investors and funds with more capital to invest in aircraft; and |
• | other aircraft leasing companies that we do not currently consider our major competitors. |
31
• | missed or late delivery of aircraft and a potential inability to meet our contractual obligations owed to any of our then lessees, resulting in potential lost or delayed revenues, lower growth rates and strained customer relationships; |
• | an inability to acquire aircraft and related components on terms which will allow us to lease those aircraft to airline customers at a profit, resulting in lower growth rates or a contraction in our aircraft fleet; |
• | a market environment with too many aircraft available, potentially creating downward pressure on demand for the anticipated aircraft in our fleet and reduced market lease rates and sale prices; or |
• | a reduction in our competitiveness due to deep discounting by the manufacturers, which may lead to reduced market lease rates and aircraft values and may affect our ability to remarket or sell at a profit, or at all, some of the aircraft in our fleet. |
32
• | affect our lessees’ ability to make rental and other lease payments; |
• | result in lease restructurings and aircraft and engine repossessions; |
• | increase our costs of maintaining and marketing aircraft; |
• | impair our ability to re-lease aircraft and other aviation assets or re-lease or otherwise sell our assets on a timely basis at favorable rates; or |
• | reduce the sale proceeds received for aircraft or other aviation assets upon any disposition. |
33
• | downward pressure on demand for our aircraft and reduced market lease rates and lease margins; |
• | a higher incidence of lessee defaults, lease restructurings, repossessions and airline bankruptcies and restructurings, resulting in lower lease margins due to maintenance and legal costs associated with repossession, as well as lost revenue for the time our aircraft are off lease and possibly lower lease rates from our new lessees; and |
• | an inability to lease aircraft on commercially acceptable terms, resulting in lower lease margins due to aircraft not earning revenue and resulting in storage, insurance and maintenance costs. |
34
35
36
• | announcements concerning our competitors, the airline industry or the economy in general; | |
• | announcements concerning the availability of the type of aircraft we own; | |
• | general and industry-specific economic conditions; | |
• | changes in the price of aircraft fuel; | |
• | changes in financial estimates or recommendations by securities analysts or failure to meet analysts’ performance expectations; | |
• | additions or departures of key members of management; | |
• | any increased indebtedness we may incur in the future; | |
• | speculation or reports by the press or investment community with respect to us or our industry in general; |
37
• | announcements by us or our competitors of significant contracts, acquisitions, dispositions, strategic partnerships, joint ventures or capital commitments; | |
• | changes or proposed changes in laws or regulations affecting the airline industry or enforcement of these laws and regulations, or announcements relating to these matters; and | |
• | general market, political and economic conditions, including any such conditions and local conditions in the markets in which our lessees are located. |
38
39
• | our status as a recently organized corporation with a limited operating history; |
• | our inability to make acquisitions of, or to lease, aircraft on favorable terms; |
• | our inability to obtain additional financing on favorable terms, if required, to complete the acquisition of sufficient aircraft as currently contemplated or to fund the operations and growth of our business; |
• | our inability to obtain refinancing prior to the time our debt matures; |
• | impaired financial condition and liquidity of our lessees; |
• | deterioration of economic conditions in the commercial aviation industry generally; |
• | increased maintenance, operating or other expenses or changes in the timing thereof; |
• | changes in the regulatory environment; |
• | potential natural disasters and terrorist attacks and the amount of our insurance coverage, if any, relating thereto; and |
• | the other risks identified in this prospectus including, without limitation, those under the sections titled “Risk factors,” “Business” and “Certain relationships and related party transactions.” |
40
41
42
2011 | High | Low | ||||||
April 19, 2011 through June 30, 2011 | $ | 29.94 | $ | 23.02 | ||||
July 1, 2011 through August 19, 2011 | $ | 25.36 | $ | 19.87 |
43
June 30,2011 | ||||
(in thousands, except share data) | Unaudited | |||
Cash and cash equivalents | $ | 445,038 | ||
Restricted cash | 68,862 | |||
Debt financing | 1,383,570 | |||
Shareholders’ equity | ||||
Preferred Stock, $0.01 par value; 50,000,000 shares authorized, no shares issued or outstanding, actual and as adjusted | — | |||
Class A Common Stock, $0.01 par value; 500,000,000 shares authorized, 98,885,131 shares issued and outstanding | 984 | |||
Class B Non-Voting Common Stock, $0.01 par value; 10,000,000 shares authorized, 1,829,339 shares issued and outstanding | 18 | |||
Paid-in capital | 2,167,187 | |||
Accumulated deficit | (41,841 | ) | ||
Total shareholders’ equity | 2,126,348 | |||
Total capitalization | $ | 3,509,918 | ||
44
For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | months ended | from Inception to | from Inception to | |||||||||||||||||
(in thousands, except share data) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
Operating data: | ||||||||||||||||||||
Rentals of flight equipment | $ | 74,004 | $ | 1,235 | $ | 128,616 | $ | 1,235 | $ | 57,075 | ||||||||||
Interest and other | 340 | 474 | 943 | 474 | 1,291 | |||||||||||||||
Total revenues | 74,344 | 1,709 | 129,559 | 1,709 | 58,366 | |||||||||||||||
Expenses | 63,456 | 46,852 | 113,746 | 47,329 | 119,281 | |||||||||||||||
Income (loss) before taxes | 10,888 | (45,143 | ) | 15,813 | (45,620 | ) | (60,915 | ) | ||||||||||||
Income tax (expense) benefit | (3,865 | ) | 4,002 | (5,614 | ) | 4,002 | 8,875 | |||||||||||||
Net income (loss) | $ | 7,023 | $ | (41,141 | ) | $ | 10,199 | $ | (41,618 | ) | $ | (52,040 | ) | |||||||
Income (loss) per share: | ||||||||||||||||||||
Basic | $ | 0.08 | $ | (2.37 | ) | $ | 0.13 | $ | (4.17 | ) | $ | (1.32 | ) | |||||||
Diluted | $ | 0.08 | $ | (2.37 | ) | $ | 0.13 | $ | (4.17 | ) | $ | (1.32 | ) | |||||||
Weighted average shares outstanding: | ||||||||||||||||||||
Basic | 91,039,329 | 17,394,121 | 78,287,085 | 9,981,375 | 39,511,045 | |||||||||||||||
Diluted | 91,163,657 | 17,394,121 | 78,408,463 | 9,981,375 | 39,511,045 | |||||||||||||||
Other financial data: | ||||||||||||||||||||
Adjusted net income (loss)(1) | $ | 19,459 | $ | (3,315 | ) | $ | 31,172 | $ | (3,792 | ) | $ | 2,520 | ||||||||
Adjusted EBITDA(2) | $ | 62,780 | $ | 3,550 | $ | 108,029 | $ | 3,073 | $ | 32,973 | ||||||||||
Balance sheet data: | ||||||||||||||||||||
Flight equipment subject to operating leases (net of accumulated depreciation) | $ | 2,814,926 | $ | 319,258 | $ | 2,814,926 | $ | 319,258 | $ | 1,629,809 | ||||||||||
Total assets | 3,753,499 | 1,159,859 | 3,753,499 | 1,159,859 | 2,276,282 | |||||||||||||||
Total debt | 1,383,570 | 25,000 | 1,383,570 | 25,000 | 911,981 | |||||||||||||||
Total liabilities | 1,627,151 | 43,719 | 1,627,151 | 43,719 | 1,051,347 | |||||||||||||||
Shareholders’ equity | 2,126,348 | 1,116,140 | 2,126,348 | 1,116,140 | 1,224,935 | |||||||||||||||
Cash flow data: | ||||||||||||||||||||
Net cash flows from: | ||||||||||||||||||||
Operating activities | $ | 48,483 | $ | 209 | $ | 87,032 | $ | 2,019 | $ | 45,124 | ||||||||||
Investing activities | (759,446 | ) | (331,351 | ) | (1,371,323 | ) | (335,601 | ) | (1,854,710 | ) | ||||||||||
Financing activities | 925,688 | 1,087,752 | 1,400,508 | 1,090,443 | 2,138,407 | |||||||||||||||
Other operating data: | ||||||||||||||||||||
Aircraft lease portfolio at period end: | ||||||||||||||||||||
Owned(3) | 65 | 8 | 65 | 8 | 40 | |||||||||||||||
(1) | Adjusted net income (loss) (defined as net income before stock-based compensation expense and non-cash interest expense, which includes the amortization of debt issuance costs and convertible debt discounts) is a measure of both operating performance and liquidity that is not defined by United States generally accepted accounting principles (“GAAP”) and should not be considered as an alternative to net income, income from operations or any other performance measures derived in accordance with GAAP. Adjusted net income is presented as a supplemental disclosure because management believes that it may be a useful performance measure that is used within our industry. We believe adjusted net income provides useful information on our earnings from ongoing operations, our ability to service our long-term debt and other fixed obligations, and our ability to fund our expected growth with internally generated funds. Set forth below is additional detail as to how |
45
we use adjusted net income as a measure of both operating performance and liquidity, as well as a discussion of the limitations of adjusted net income as an analytical tool and a reconciliation of adjusted net income to our GAAP net loss and cash flow from operating activities. | ||
Operating Performance: Management and our board of directors adjusted use net income in a number of ways to assess our consolidated financial and operating performance, and we believe this measure is helpful in identifying trends in our performance. We use adjusted net income as a measure of our consolidated operating performance exclusive of income and expenses that relate to the financing, income taxes, and capitalization of the business. Also, adjusted net income assists us in comparing our operating performance on a consistent basis as it removes the impact of our capital structure (primarily one-time amortization of convertible debt discounts) and stock-based compensation expense from our operating results. In addition, adjusted net income helps management identify controllable expenses and make decisions designed to help us meet our current financial goals and optimize our financial performance. Accordingly, we believe this metric measures our financial performance based on operational factors that we can influence in the short term, namely the cost structure and expenses of the organization. | ||
Liquidity: In addition to the uses described above, management and our board of directors use adjusted net income as an indicator of the amount of cash flow we have available to service our debt obligations, and we believe this measure can serve the same purpose for our investors. | ||
Limitations: Adjusted net income has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our operating results or cash flows as reported under GAAP. Some of these limitations are as follows: | ||
• adjusted net income does not reflect (i) our cash expenditures or future requirements for capital expenditures or contractual commitments, or (ii) changes in or cash requirements for our working capital needs; and | ||
• our calculation of adjusted net income may differ from the adjusted net income or analogous calculations of other companies in our industry, limiting its usefulness as a comparative measure. | ||
The following tables show the reconciliation of net income (loss) and cash flows from operating activities, the most directly comparable GAAP measures of performance and liquidity, to adjusted net income: |
For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | months ended | from Inception to | from Inception to | |||||||||||||||||
(in thousands) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
Reconciliation of cash flows from operating activities to adjusted net income (loss): | ||||||||||||||||||||
Net cash provided by operating activities | $ | 48,483 | $ | 209 | $ | 87,032 | $ | 2,019 | $ | 45,124 | ||||||||||
Depreciation of flight equipment | (24,644 | ) | (327 | ) | (42,774 | ) | (327 | ) | (19,262 | ) | ||||||||||
Stock-based compensation | (11,753 | ) | (2,255 | ) | (22,660 | ) | (2,255 | ) | (24,044 | ) | ||||||||||
Deferred taxes | (3,866 | ) | 4,002 | (5,614 | ) | 4,002 | 8,875 | |||||||||||||
Amortization of deferred debt issue costs | (2,336 | ) | (875 | ) | (4,664 | ) | (875 | ) | (4,883 | ) | ||||||||||
Extinguishment of debt | (3,349 | ) | — | (3,349 | ) | — | — | |||||||||||||
Amortization of convertible debt discounts | — | (35,798 | ) | — | (35,798 | ) | (35,798 | ) | ||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||||||
Lease receivables and other assets | 14,042 | 1,094 | 16,327 | 1,199 | 8,040 | |||||||||||||||
Accrued interest and other payables | (5,904 | ) | (5,032 | ) | (6,932 | ) | (7,424 | ) | (22,054 | ) | ||||||||||
Rentals received in advance | (3,650 | ) | (2,159 | ) | (7,167 | ) | (2,159 | ) | (8,038 | ) | ||||||||||
Net income (loss) | 7,023 | (41,141 | ) | 10,199 | (41,618 | ) | (52,040 | ) | ||||||||||||
Amortization of debt issue costs | 2,336 | 875 | 4,664 | 875 | 4,883 | |||||||||||||||
Extinguishment of debt | 3,349 | — | 3,349 | — | — | |||||||||||||||
Amortization of convertible debt discounts | — | 35,798 | — | 35,798 | 35,798 | |||||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | 24,044 | |||||||||||||||
Tax effect | (5,002 | ) | (1,102 | ) | (9,700 | ) | (1,102 | ) | (10,165 | ) | ||||||||||
Adjusted net income (loss) | $ | 19,459 | $ | (3,315 | ) | $ | 31,172 | $ | (3,792 | ) | $ | 2,520 | ||||||||
For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | monthsended | from Inception to | from Inception to | |||||||||||||||||
(in thousands) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
1,6 | ||||||||||||||||||||
Reconciliation of net income (loss) to adjusted net income (loss): | ||||||||||||||||||||
Net income (loss) | $ | 7,023 | $ | (41,141 | ) | $ | 10,199 | $ | (41,618 | ) | $ | (52,040 | ) | |||||||
Amortization of debt issue costs | 2,336 | 875 | 4,664 | 875 | 4,883 | |||||||||||||||
Extinguishment of debt | 3,349 | — | 3,349 | — | — | |||||||||||||||
Amortization of convertible debt discounts | — | 35,798 | — | 35,798 | 35,798 | |||||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | 24,044 | |||||||||||||||
Tax effect | (5,002 | ) | (1,102 | ) | (9,700 | ) | (1,102 | ) | (10,165 | ) | ||||||||||
Adjusted net income (loss) | $ | 19,459 | $ | (3,315 | ) | $ | 31,172 | $ | (3,792 | ) | $ | 2,520 | ||||||||
46
(2) | Adjusted EBITDA (defined as net loss before net interest expense, stock-based compensation expense, income tax expense (benefit), and depreciation and amortization expense) is a measure of both operating performance and liquidity that is not defined by GAAP and should not be considered as an alternative to net income, income from operations or any other performance measures derived in accordance with GAAP. Adjusted EBITDA is presented as a supplemental disclosure because management believes that it may be a useful performance measure that is used within our industry. We believe adjusted EBITDA provides useful information on our earnings from ongoing operations, our ability to service our long-term debt and other fixed obligations, and our ability to fund our expected growth with internally generated funds. Set forth below is additional detail as to how we use adjusted EBITDA as a measure of both operating performance and liquidity, as well as a discussion of the limitations of adjusted EBITDA as an analytical tool and a reconciliation of adjusted EBITDA to our GAAP net loss and cash flow from operating activities. | |
Operating Performance: Management and our board of directors use adjusted EBITDA in a number of ways to assess our consolidated financial and operating performance, and we believe this measure is helpful in identifying trends in our performance. We use adjusted EBITDA as a measure of our consolidated operating performance exclusive of income and expenses that relate to the financing, income taxes, and capitalization of the business. Also, adjusted EBITDA assists us in comparing our operating performance on a consistent basis as it removes the impact of our capital structure (primarily one-time amortization of convertible debt discounts) and stock-based compensation expense from our operating results. In addition, adjusted EBITDA helps management identify controllable expenses and make decisions designed to help us meet our current financial goals and optimize our financial performance. Accordingly, we believe this metric measures our financial performance based on operational factors that we can influence in the short term, namely the cost structure and expenses of the organization. | ||
Liquidity: In addition to the uses described above, management and our board of directors use adjusted EBITDA as an indicator of the amount of cash flow we have available to service our debt obligations, and we believe this measure can serve the same purpose for our investors. | ||
Limitations: Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our operating results or cash flows as reported under GAAP. Some of these limitations are as follows: | ||
• adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments; | ||
• adjusted EBITDA does not reflect changes in or cash requirements for our working capital needs; | ||
• adjusted EBITDA does not reflect interest expense or cash requirements necessary to service interest or principal payments on our debt; and | ||
• other companies in our industry may calculate these measures differently from how we calculate these measures, limiting their usefulness as comparative measures. | ||
The following tables show the reconciliation of net income (loss) and cash flows from operating activities, the most directly comparable GAAP measures of performance and liquidity, to adjusted EBITDA: |
For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | months ended | from Inception to | from Inception to | |||||||||||||||||
(in thousands) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
Reconciliation of cash flows from operating activities to adjusted EBITDA: | ||||||||||||||||||||
Net cash provided by operating activities | $ | 48,483 | $ | 209 | $ | 87,032 | $ | 2,019 | $ | 45,124 | ||||||||||
Depreciation of flight equipment | (24,644 | ) | (327 | ) | (42,774 | ) | (327 | ) | (19,262 | ) | ||||||||||
Stock-based compensation | (11,753 | ) | (2,255 | ) | (22,660 | ) | (2,255 | ) | (24,044 | ) | ||||||||||
Deferred taxes | (3,866 | ) | 4,002 | (5,614 | ) | 4,002 | 8,875 | |||||||||||||
Amortization of deferred debt issue costs | (2,336 | ) | (875 | ) | (4,664 | ) | (875 | ) | (4,883 | ) | ||||||||||
Extinguishment of debt | (3,349 | ) | — | (3,349 | ) | — | — | |||||||||||||
Amortization of convertible debt discounts | — | (35,798 | ) | — | (35,798 | ) | (35,798 | ) | ||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||||||
Lease receivables and other assets | 14,042 | 1,094 | 16,327 | 1,199 | 8,040 | |||||||||||||||
Accrued interest and other payables | (5,904 | ) | (5,032 | ) | (6,932 | ) | (7,424 | ) | (22,054 | ) | ||||||||||
Rentals received in advance | (3,650 | ) | (2,159 | ) | (7,167 | ) | (2,159 | ) | (8,038 | ) | ||||||||||
Net income (loss) | 7,023 | (41,141 | ) | 10,199 | (41,618 | ) | (52,040 | ) | ||||||||||||
Net interest expense | 15,495 | 38,107 | 26,782 | 38,107 | 50,582 | |||||||||||||||
Income taxes | 3,865 | 4,002 | 5,614 | 4,002 | (8,875 | ) | ||||||||||||||
Depreciation | 24,644 | 327 | 42,774 | 327 | 19,262 | |||||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | 24,044 | |||||||||||||||
Adjusted EBITDA | $ | 62,780 | $ | 3,550 | $ | 108,029 | $ | 3,073 | $ | 32,973 | ||||||||||
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For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | months ended | from Inception to | from Inception to | |||||||||||||||||
(in thousands) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
1,6 | ||||||||||||||||||||
Reconciliation of net income (loss) to adjusted EBITDA: | ||||||||||||||||||||
Net income (loss) | $ | 7,023 | $ | (41,141 | ) | $ | 10,199 | $ | (41,618 | ) | $ | (52,040 | ) | |||||||
Net interest expense | 15,495 | 38,107 | 26,782 | 38,107 | 50,582 | |||||||||||||||
Income taxes | 3,865 | 4,002 | 5,614 | 4,002 | (8,875 | ) | ||||||||||||||
Depreciation | 24,644 | 327 | 42,774 | 327 | 19,262 | |||||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | 24,044 | |||||||||||||||
Adjusted EBITDA | $ | 62,780 | $ | 3,550 | $ | 108,029 | $ | 3,073 | $ | 32,973 | ||||||||||
(3) | As of June 30, 2011, we owned 65 aircraft (of which 13 were new aircraft and 52 were used aircraft) and we managed one aircraft. As of December 31, 2010, we owned 40 aircraft of which four were new aircraft and 36 were used aircraft. |
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financial condition and results of operations
Aircraft Type | 2011 | (1) | 2012 | 2013 | 2014 | 2015 | Thereafter | Total | ||||||||||||||||||||
Airbus A319-100 | 1 | 1 | ||||||||||||||||||||||||||
Airbus A320/321-200 | 5 | 10 | 13 | 12 | 7 | 47 | ||||||||||||||||||||||
Airbus A320/321 NEO(2)(3) | 50 | 50 | ||||||||||||||||||||||||||
Airbus A330-200/300 | 6 | 6 | 12 | |||||||||||||||||||||||||
Boeing 737-700 | 2 | 2 | ||||||||||||||||||||||||||
Boeing 737-800(2) | 2 | 3 | 12 | 12 | 14 | 37 | 80 | |||||||||||||||||||||
Boeing 767-300ER | 2 | 2 | ||||||||||||||||||||||||||
Boeing 777-300ER(3) | 2 | 3 | 5 | |||||||||||||||||||||||||
Boeing 787-9(3) | 4 | 4 | ||||||||||||||||||||||||||
Embraer E175/190 | 11 | 19 | 30 | |||||||||||||||||||||||||
ATR 72-600 | 2 | 8 | 10 | |||||||||||||||||||||||||
Total | 31 | 46 | 25 | 26 | 24 | 91 | 243 | |||||||||||||||||||||
(1) | Of the 31 aircraft that we will acquire in the remainder of 2011, the following nine aircraft will be used aircraft: the Airbus A319-100, one Airbus A320-200, one Airbus A330-200, both Boeing 737-700s, both Boeing 737-800s and both Boeing 767-300ERs. | |
(2) | We have cancellation rights with respect to 14 of the Airbus A320/321 NEO aircraft and four of the Boeing 737-800 aircraft. | |
(3) | As of June 30, 2011, all of the Airbus A320/321 NEO aircraft, the Boeing 777-300ER aircraft and the Boeing 787-9 aircraft were subject to non-binding memoranda of understanding for the purchase of these aircraft. | |
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50
51
(dollars in thousands) | June 30, 2011 | December 31, 2010 | |||||
Secured debt | $ | 1,212,671 | $ | 778,896 | |||
Unsecured debt | 170,899 | 133,085 | |||||
Total | $ | 1,383,570 | $ | 911,981 | |||
Composite interest rate(1) | 3.29 | % | 3.32 | % | |||
(1) | This rate does not include the effect of upfront fees, undrawn fees or issuance cost amortization. |
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For the six | For the period | For the period | ||||||||||||||||||
For the three months ended | months ended | from Inception to | from Inception to | |||||||||||||||||
(in thousands, except share data) | June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | December 31, 2010 | |||||||||||||||
Revenues | ||||||||||||||||||||
Rental of flight equipment | $ | 74,004 | $ | 1,235 | $ | 128,616 | $ | 1,235 | $ | 57,075 | ||||||||||
Interest and other | 340 | 474 | 943 | 474 | 1,291 | |||||||||||||||
Total revenues | 74,344 | 1,709 | 129,559 | 1,709 | 58,366 | |||||||||||||||
Expenses | ||||||||||||||||||||
Interest | 10,090 | 1,838 | 19,150 | 1,838 | 11,062 | |||||||||||||||
Amortization of deferred debt issue costs | 2,336 | 875 | 4,664 | 875 | 4,883 | |||||||||||||||
Extinguishment of debt | 3,349 | — | 3,349 | — | — | |||||||||||||||
Amortization of convertible debt discounts | — | 35,798 | — | 35,798 | 35,798 | |||||||||||||||
Interest expense | 15,775 | 38,511 | 27,163 | 38,511 | 51,743 | |||||||||||||||
Depreciation of flight equipment | 24,644 | 327 | 42,774 | 327 | 19,262 | |||||||||||||||
Selling, general and administrative | 11,284 | 5,759 | 21,149 | 6,236 | 24,232 | |||||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | 24,044 | |||||||||||||||
Total expenses | 63,456 | 46,852 | 113,746 | 47,329 | 119,281 | |||||||||||||||
Income (loss) before taxes | 10,888 | (45,143 | ) | 15,813 | (45,620 | ) | (60,915 | ) | ||||||||||||
Income tax (expense) benefit | (3,865 | ) | 4,002 | (5,614 | ) | 4,002 | 8,875 | |||||||||||||
Net income (loss) | $ | 7,023 | $ | (41,141 | ) | $ | 10,199 | $ | (41,618 | ) | $ | (52,040 | ) | |||||||
Amortization of debt issue costs | $ | 2,336 | $ | 875 | $ | 4,664 | $ | 875 | $ | 4,883 | ||||||||||
Extinguishment of debt | 3,349 | — | 3,349 | — | — | |||||||||||||||
Amortization of convertible debt discounts | — | 35,798 | — | 35,798 | 35,798 | |||||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | 24,044 | |||||||||||||||
Tax effect | (5,002 | ) | (1,102 | ) | (9,700 | ) | (1,102 | ) | (10,165 | ) | ||||||||||
Adjusted net income (loss) | $ | 19,459 | $ | (3,315 | ) | $ | 31,172 | $ | (3,792 | ) | $ | 2,520 | ||||||||
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(dollars in thousands) | 2011 | 2012 | 2013 | 2014 | 2015 | Thereafter | Total | |||||||||||||||||||||
Long-term debt obligations | $ | 35,063 | $ | 71,637 | $ | 204,764 | $ | 220,973 | $ | 228,611 | $ | 622,522 | $ | 1,383,570 | ||||||||||||||
Interest payments on debt outstanding(1) | 25,465 | 48,773 | 43,497 | 33,913 | 27,212 | 20,391 | 199,251 | |||||||||||||||||||||
Purchase commitments | 1,289,930 | 1,817,592 | 1,210,000 | 1,408,662 | 1,381,692 | 4,756,915 | 11,864,791 | |||||||||||||||||||||
Operating leases | — | 1,441 | 2,325 | 2,395 | 2,467 | 23,241 | 31,869 | |||||||||||||||||||||
Total | $ | 1,350,458 | $ | 1,939,443 | $ | 1,460,586 | �� | $ | 1,665,943 | $ | 1,639,982 | $ | 5,423,069 | $ | 13,479,481 | |||||||||||||
(1) | As of June 30, 2011, the Company had $709.3 million of debt outstanding under the Warehouse Facility which will come due beginning in June 2013. The outstanding drawn balance at the end of the availability period may be converted at the Company’s option to an amortizing, four-year term loan with an increasing interest rate and has been presented as if such option were exercised in the contractual obligation schedule above. | |
(2) | Future interest payments on floating rate debt are estimated using floating rates in effect at June 30, 2011. | |
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Year-End Data1970-2010
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January 2009 - April 2011
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2011-2015
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(in billions)
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(in billions)
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• | aircraft type and age; |
• | number of aircraft in service today; |
• | number of airlines who operate the aircraft; |
• | production status; |
• | size, capacity, and capability; |
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• | number of aircraft that are currently parked or in storage (a result of either market conditions or an operator decision to park the aircraft, either temporarily or permanently); and |
• | life cycle duration, which is the potential of the aircraft type to be replaced by a newer model. |
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Aircraft | No. of aircraft | |||||||||||||||||||||||||||||||||||
Aircraft | Capacity | in | No. of airline | on operating | Production | |||||||||||||||||||||||||||||||
Manufacturer | type | Model | Body type | (seats) | service | Backlog | operators | lease (apprx) | years (to date) | |||||||||||||||||||||||||||
Boeing | 737NG | -700 | narrow | 126 | 1196 | 289 | 155 | 417 | 14 | |||||||||||||||||||||||||||
-800 | narrow | 162 | 2311 | 1263 | 153 | 1106 | 14 | |||||||||||||||||||||||||||||
777 | 300ER | wide | 365 | 290 | 210 | 27 | 137 | 8 | ||||||||||||||||||||||||||||
Airbus | A320 | A319-100 | narrow | 124 | 1309 | 157 | 146 | 571 | 16 | |||||||||||||||||||||||||||
A320-200 | narrow | 150 | 2709 | 1481 | 232 | 1334 | 23 | |||||||||||||||||||||||||||||
A321-200 | narrow | 185 | 661 | 240 | 68 | 262 | 15 | |||||||||||||||||||||||||||||
A320 NEO | narrow | 150 | 0 | 722 | 11 (customers) | 185 | Beginning 2015 | |||||||||||||||||||||||||||||
A321 NEO | narrow | 185 | 0 | 196 | 5 (customers) | 25 | Beginning 2015 | |||||||||||||||||||||||||||||
A330 | -200 | wide | 253 | 434 | 173 | 75 | 218 | 13 | ||||||||||||||||||||||||||||
ATR | ATR72 | -600 | turboprop | 74 | 2 | 87 | 1 | 0 | 1 | |||||||||||||||||||||||||||
Embraer | Ejet | 170 | narrow | 70-75 | 185 | 3 | 25 | 72 | 8 | |||||||||||||||||||||||||||
175 | narrow | 80-90 | 137 | 18 | 12 | 48 | 7 | |||||||||||||||||||||||||||||
190 | narrow | 90-100 | 355 | 130 | 35 | 157 | 6 |
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Aircraft Fleet
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• | a focus on specific geographic regions; |
• | a focus on a diversified fleet structure (narrowbody or widebody aircraft); |
• | a focus on securitization of aircraft assets; and |
• | different financial structures, that is, private or public company funding. |
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Aircraft type | 2011 | 2012 | 2013 | 2014 | 2015 | Thereafter | Total | |||||||||||||||||||||
Airbus A319-100 | 3 | 1 | 3 | 7 | ||||||||||||||||||||||||
Airbus A320-200 | 3 | 3 | 1 | 9 | 16 | |||||||||||||||||||||||
Airbus A321-200 | 3 | 3 | ||||||||||||||||||||||||||
Airbus A330-200 | 5 | 5 | ||||||||||||||||||||||||||
Boeing B737-700 | 1 | 1 | 3 | 5 | ||||||||||||||||||||||||
Boeing B737-800 | 1 | 3 | 6 | 7 | 7 | 24 | ||||||||||||||||||||||
Boeing B767-300ER | 1 | — | 1 | |||||||||||||||||||||||||
Boeing B777-300ER | 4 | 4 | ||||||||||||||||||||||||||
Total | — | 5 | 10 | 7 | 9 | 34 | 65 | |||||||||||||||||||||
Aircraft Type | 2011 | (1) | 2012 | 2013 | 2014 | 2015 | Thereafter | Total | ||||||||||||||||||||
Airbus A319-100 | 1 | 1 | ||||||||||||||||||||||||||
Airbus A320/321-200 | 5 | 10 | 13 | 12 | 7 | 47 | ||||||||||||||||||||||
Airbus A320/321 NEO(2)(3) | 50 | 50 | ||||||||||||||||||||||||||
Airbus A330-200/300 | 6 | 6 | 12 | |||||||||||||||||||||||||
Boeing 737-700 | 2 | 2 | ||||||||||||||||||||||||||
Boeing 737-800(2) | 2 | 3 | 12 | 12 | 14 | 37 | 80 | |||||||||||||||||||||
Boeing 767-300ER | 2 | 2 | ||||||||||||||||||||||||||
Boeing 777-300ER(3) | 2 | 3 | 5 | |||||||||||||||||||||||||
Boeing 787-9(3) | 4 | 4 | ||||||||||||||||||||||||||
Embraer E175/190 | 11 | 19 | 30 | |||||||||||||||||||||||||
ATR 72-600 | 2 | 8 | 10 | |||||||||||||||||||||||||
Total | 31 | 46 | 25 | 26 | 24 | 91 | 243 | |||||||||||||||||||||
(1) | Of the 31 aircraft that we will acquire in the remainder of 2011, the following nine aircraft will be used aircraft: the Airbus A319-100, one Airbus A320-200, one Airbus A330-200, both Boeing 737-700s, both Boeing 737-800s and both Boeing 767-300ERs. | |
(2) | We have cancellation rights with respect to 14 of the Airbus A320/321 NEO aircraft and four of the Boeing 737-800 aircraft. | |
(3) | As of June 30, 2011, all of the Airbus A320/321 NEO aircraft, Boeing 777-300ER aircraft and the Boeing 787-9 aircraft were subject to non-binding memoranda of understanding for the purchase of these aircraft. | |
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June 30, 2011 | Dcember 31, 2010 | |||||||||||||||
Number of | % of | Number of | % of | |||||||||||||
Region | aircraft | total | aircraft | total | ||||||||||||
Europe | 24 | 36.9 | % | 16 | 40.0 | % | ||||||||||
Asia/Pacific | 22 | 33.9 | % | 11 | 27.5 | % | ||||||||||
Central America, South America and Mexico | 8 | 12.3 | % | 5 | 12.5 | % | ||||||||||
U.S. and Canada | 8 | 12.3 | % | 5 | 12.5 | % | ||||||||||
The Middle East and Africa | 3 | 4.6 | % | 3 | 7.5 | % | ||||||||||
Total | 65 | 100.0 | % | 40 | 100.0 | % | ||||||||||
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Region | Existing lessees | |
Europe | Aer Lingus, Air Astana, Air Austral, Air Berlin, Air France, Alitalia, KLM, Norwegian, Sunwing, Sun Express, Transavia, Travel Service and Vueling | |
Asia/Pacific | AirAsia, Air Macau, Air New Zealand, GoAir, Hainan, Kingfisher, MIAT, Mihin Lanka, Shanghai, Sichuan, Skymark, SpiceJet, Spring, SriLankan, Virgin Australia and Xiamen | |
Central America, South America and Mexico | Aeromexico, Avianca, Interjet, TAM and Volaris | |
U.S. and Canada | Air Canada, Caribbean, Continental, Southwest, Spirit and WestJet | |
The Middle East and Africa | Air Arabia, Etihad and South African Airways | |
For the six | For the period | |||||||||||||||
months ended | from Inception to | |||||||||||||||
(dollars in thousands) | June 30, 2011 | December 31, 2010 | ||||||||||||||
Amount of | % of | Amount of | % of | |||||||||||||
Region | rental revenue | total | rental revenue | total | ||||||||||||
Europe | $ | 61,106 | 47.5 | % | $ | 31,157 | 54.6 | % | ||||||||
Asia/Pacific | 35,530 | 27.6 | 11,933 | 20.9 | ||||||||||||
Central America, South America and Mexico | 8,947 | 7.0 | 4,953 | 8.7 | ||||||||||||
U.S. and Canada | 17,178 | 13.4 | 6,309 | 11.0 | ||||||||||||
The Middle East and Africa | 5,855 | 4.5 | 2,723 | 4.8 | ||||||||||||
Total | $ | 128,616 | 100.0 | % | $ | 57,075 | 100.0 | % | ||||||||
June 30, 2011 | December 31, 2010 | |||||||
% of net | % of net | |||||||
Region | book value | book value | ||||||
Europe | 45.8 | % | 42.3 | % | ||||
Asia/Pacific | 27.8 | 26.1 | ||||||
Central America, South America and Mexico | 10.7 | 10.0 | ||||||
U.S. and Canada | 12.3 | 15.6 | ||||||
The Middle East and Africa | 3.4 | 6.0 | ||||||
Total | 100.0 | % | 100.0 | % | ||||
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For the six | For the period | |||||||||||||||
months ended | from Inception to | |||||||||||||||
(dollars in thousands) | June 30, 2011 | December 31, 2010 | ||||||||||||||
Amount of | % of | Amount of | % of | |||||||||||||
Country | rental revenue | total | rental revenue | total | ||||||||||||
France | $ | 28,535 | 22.2 | % | $ | 8,598 | 15.1 | % | ||||||||
Germany | $ | 15,561 | 12.1 | % | $ | 15,153 | 26.5 | % | ||||||||
China | $ | 15,488 | 12.0 | % | $ | 6,091 | 10.7 | % | ||||||||
For the six | For the period | |||||||||||||||
months ended | from Inception to | |||||||||||||||
(dollars in thousands) | June 30, 2011 | December 31, 2010 | ||||||||||||||
Amount of | % of | Amount of | % of | |||||||||||||
Customer(1) | rental revenue | total | rental revenue | total | ||||||||||||
Air France | $ | 20,589 | 16.0 | % | $ | 8,598 | 15.1 | % | ||||||||
Air Berlin | $ | 15,561 | 12.1 | % | $ | 15,153 | 26.5 | % | ||||||||
(1) | A customer is an airline with its own operating certificate. |
• | Capitalize on attractive market opportunities to grow our modern fleet of aircraft. We plan to continue acquiring aircraft and expect that a significant portion of these acquisitions will be subject to existing or new leases that produce immediate positive cash flows. We seek aircraft that produce attractive returns on equity while maintaining diversified lease portfolio characteristics in terms of aircraft type, aircraft age, lease term and geographic location of our lessees. We intend to continue to take advantage of the current economic environment to make opportunistic purchases of aircraft and aircraft portfolios. We plan to expand our fleet with a mix of narrowbody and widebody commercial aircraft that we expect to have long useful lives and that are currently in widespread use by airlines, with a greater focus on acquiring narrowbody aircraft. Based on our ongoing discussions with airlines, we believe narrowbody and certain widebody aircraft will continue to experience strong global airline demand. We have also entered into commitments to purchase select fuel-efficient regional jets and turboprop aircraft, such as the Embraer E175/E190 and ATR72-600 aircraft types. We believe market demand for these types of aircraft will grow as they are well suited for direct service between smaller and medium-sized cities and between such cities and major hub cities. |
• | Continue to develop and grow our long-standing relationships and cultivate new relationships. We believe our management team’s experience in the aircraft leasing industry provides us immediate access to key decision makers at airframe and engine manufacturers and major airlines around the world, thereby enabling us to make prompt acquisitions of new |
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aircraft, enter into new leases, and anticipate airlines’ longer-term needs so as to tailor our fleet and leases to their specific needs. Additionally, we believe our relationships with airframe and engine manufacturers allow us to influence their airframe and engine designs to better meet the needs of our airline customers. In our view, the aircraft leasing industry continues to be relationship-driven, and airframe and engine manufacturers and our airline customers will place a high value on the expertise and experience of our management team. This will help us develop new relationships, while we use ourlong-standing contacts to grow our business. We believe these relationships will help to establish us as a leader in the aircraft leasing industry over time. |
• | Emphasize marketing in high-growth areas of the world. As our portfolio grows, we anticipate that a growing percentage of our aircraft will be located in Asia, the Pacific Rim, Latin America, the Middle East and Eastern Europe, although we will continue to enter into select leasing transactions in North America and Western Europe. We expect aircraft demand to increase in emerging markets over the next several years, as forecasted by AVITAS. We believe a developing infrastructure supporting direct air travel to more destinations within emerging market regions, combined with economic and population growth, an expected increase in the number of low-cost carriers, expansion of existing low-cost carriers, deregulation in air travel, and a significant increase in such areas’ middle class populations, will lead to growth in passenger air travel in these regions. |
• | Enter into strategic ventures. We may, on occasion, enter into strategic ventures with third parties in order to take advantage of favorable financing or other opportunities, to share capitaland/or operating risk,and/or to earn fleet management fees. Given our broad experience in acquiring, leasing, financing and managing aircraft, we believe that third parties seeking to invest in the aircraft leasing industry will view us as an attractive partner. Other than one arrangement whereby we manage one aircraft owned by a third party that is leased to one of our customers, we currently do not participate in, or have any binding commitments to enter into, any strategic ventures with any third parties. |
• | Actively manage our lease portfolio to optimize returns and minimize risk through diversification. In actively managing our aircraft portfolio, we seek to optimize returns and minimize risks by appropriately and prudently diversifying the types of aircraft we acquire, maintaining a low average fleet age, spreading out over a number of years the termination dates for our leases, achieving geographic diversification, and minimizing our exposure to customer concentration. Our acquisition of desirable aircraft types with a low average fleet age helps to maximize the mobility of our assets across global markets, which allows us to achieve a high rate of lease placements on attractive lease terms. Through the implementation of our diversification strategies, we believe that we are in a position to reduce our exposure to industry fluctuations over a particular period of time, economic fluctuations in a particular regional market, changes in customer preferences for particular aircraft, and the credit risk posed by a particular customer. |
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• | Highly experienced management team with diversified aviation and technical experience. Our senior management team, with an average of over 23 years of experience in the aviation industry, has significant experience in all aspects of the aviation and aircraft leasing industries, including the implementation of innovative lease structures, strategic planning, risk diversification, fleet restructuring, aircraft purchasing and financing strategies, and general transactional capabilities. We have separate Sales, Marketing and Commercial Affairs; Finance and Accounting; Legal; Commercial Contracts; Aircraft Procurement and Specifications; and Technical Asset Management departments that are involved in our leasing, sales and purchasing business. Our Technical Asset Management department has in-depth knowledge of aircraft, engines, avionics and the various regulations governing the maintenance of aircraft. This department monitors the fleet while on lease to our airline customers, handles the transfer of the aircraft from one operator to the next and monitors operator compliance with its technical and maintenance obligations under our leases. |
• | Available deployable capital to capture attractive market opportunities. With the net proceeds from our initial public offering, cash on hand, the financing available under the Warehouse Facility and multiple unsecured lines of credit, we have significant purchasing power that we can quickly deploy to acquire additional aircraft. In addition, we may supplement our access to capital with debt guaranteed by government agencies such as Ex-Im Bank and the ECAs and loans from BNDES for qualifying aircraft purchases and other debt financing arrangements. Our access to capital provides us with the flexibility to complete attractive aircraft purchases. |
• | Strong aircraft delivery pipeline. Through our strategic and opportunistic approaches to acquiring aircraft and our strong relationship with airframe manufacturers, as of June 30, 2011, we have entered into binding and non-binding purchase commitments to acquire 234 new aircraft over the next ten years. We |
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believe that our access to this strong aircraft delivery pipeline over this period gives us the ability to provide airline customers with a comprehensive, multi-year solution to their aircraft leasing and fleet needs. This ability represents a significant competitive advantage in developing, renewing and expanding customer relationships as we have new aircraft available for delivery during periods far earlier than most of our airline customers can obtain new aircraft directly from airframe and engine manufacturers. |
• | Young, modern and efficient aircraft fleet. Our aircraft portfolio primarily consists of modern, fuel-efficient narrowbody aircraft. As of June 30, 2011, the weighted average age of the aircraft in our current portfolio was 3.6 years. We believe we have one of the world’s youngest operating lease portfolios. Younger aircraft are more desirable than older aircraft because of their fuel efficiency, lower maintenance costs, and longer remaining useful lives. Furthermore, younger aircraft are more likely to be in compliance with newer environmental standards or are more easily brought up to environmental compliance without costly modifications. We believe our aircraft, and the additional aircraft that we will acquire, are in high demand among our airline customers and are readily deployable to various markets throughout the world. We expect that our fleet of young, high-demand aircraft will enable us to provide stable and growing cash flows to our stockholders over the long term. |
• | Long-standing relationships with a global, diversified customer base. Our management team is well-known in the aviation industry and we are able to benefit from the long-standing relationships that Messrs. Udvar-Házy and Plueger and other key members of management have with more than 200 airlines in over 70 countries. |
• | Strong manufacturer relationships. The supply of commercial passenger aircraft is dominated by a few airframe manufacturers, including Boeing, Airbus, ATR, Embraer and Bombardier. Through our management team’s active and long-standing participation in the aviation industry, we have developed strategic relationships with many of the manufacturers and suppliers of aircraft and aircraft parts, which enables us to leverage competitive acquisition and delivery terms and to influence new aircraft design. |
• | Our management team’s and our board of directors’ significant investment in us aligns the interests of management and our board with those of our other stockholders. Members of our management team (and their families or affiliates) and members of our board of directors have invested an aggregate of approximately $91 million in shares of our Class A Common Stock. We believe that our management team’s and our board of directors’ significant combined ownership stake in our Class A Common Stock, along with additional equity incentive grants, closely aligns our management team’s and our board of directors’ interests with those of our other stockholders. |
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• | the needs of our airline customers at the time of acquisition and their anticipated needs at the end of typical leasing cycles; |
• | an aircraft’s fit within our diversified fleet based on its type, price, age, market value, specifications and configuration, condition and maintenance history, operating efficiency and potential for future redeployment; |
• | an aircraft model’s reliability, long-term utility for airline customers, and appeal to a large segment of the industry; |
• | jurisdiction of the lessee or potential lessee; and |
• | legal and tax implications. |
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• | most of our leases will be for fixed terms, although, where mutually beneficial, we may provide for purchase options or termination or extension rights; |
• | most of our leases will require monthly payment in advance; |
• | most of our leases will generally provide that the lessee’s payment obligations are absolute and unconditional; |
• | our lessees will typically be required to make payment without deduction on account of any amounts that we may owe to the lessee or any claims that the lessee may have against us; |
• | most of our leases will also require lessees to gross up lease payments to cover tax withholdings or other tax obligations, other than withholdings that arise out of transfers of the aircraft to or by us or due to our corporate structure; and |
• | our leases will also generally require that our lessees indemnify us for certain other tax liabilities relating to the leases and the aircraft, including, in most cases, value-added tax and stamp duties. |
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Name | Age | Position | ||||
Steven F. Udvar-Házy | 65 | Chairman and Chief Executive Officer | ||||
John L. Plueger | 57 | President, Chief Operating Officer and Director | ||||
Grant A. Levy | 48 | Executive Vice President, General Counsel and Secretary | ||||
Marc H. Baer | 46 | Executive Vice President, Marketing | ||||
Alex A. Khatibi | 50 | Executive Vice President | ||||
Jie Chen | 47 | Executive Vice President and Managing Director of Asia | ||||
James C. Clarke | 53 | Senior Vice President and Chief Financial Officer | ||||
Gregory B. Willis | 32 | Vice President, Finance, and Chief Accounting Officer | ||||
John D. Poerschke | 49 | Senior Vice President of Aircraft Procurement and Specifications | ||||
John G. Danhakl | 55 | Director | ||||
Matthew J. Hart | 59 | Director | ||||
Robert A. Milton | 51 | Director | ||||
Michel M.R.G. Péretié | 57 | Director | ||||
Antony P. Ressler | 50 | Director | ||||
Wilbur L. Ross, Jr. | 73 | Director | ||||
Ian M. Saines | 49 | Director | ||||
Dr. Ronald D. Sugar | 63 | Director | ||||
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• | Review and adjust each Named Executive Officer’s compensation in order to ensure an appropriate mix of cash and equity, and an appropriate balance of fixed and at-risk compensation, in light of, among other factors, each individual’s particular role and responsibilities, personal motivations, stock ownership exposure and wealth accumulation. |
• | Approve specific performance targets and individual goals for each Named Executive Officer with respect to the at-risk portions of his compensation. |
• | Consult with the compensation committee’s independent consultant to help ensure that the total compensation paid to each Named Executive Officer is appropriate in light of our Company’s compensation objectives, tax and accounting considerations and compensation best practices. |
• | Approve incentive award payouts based on performance actually achieved. |
• | Approve bonus payments based onafter-the-fact evaluations of Company and individual performance. We regard retrospective evaluation as appropriate for our current compensation program because, as a young company, we have a limited ability to forecast performance, we need to consider qualitative milestones as we grow, and for purposes of 2010 bonuses, we lacked appropriate baselines to support performance benchmarking. Commencing with bonuses for 2011, our Company and the compensation committee plan to apply quantitative factors as well as qualitative milestones in the determination of bonus payments. |
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Stock | Option | All other | ||||||||||||||||||||||||||
Name and | Salary | Bonus | awards* | awards* | compensation | Total | ||||||||||||||||||||||
principal position | Year | ($) | ($)(1) | ($)(2) | ($)(2) | ($)(3) | ($) | |||||||||||||||||||||
Steven F. Udvar-Házy | 2010 | $ | 1,622,727 | $ | 2,300,000 | $ | 35,008,520 | $ | 18,807,128 | $ | 29,682 | $ | 57,768,057 | |||||||||||||||
Chairman and Chief Executive Officer | ||||||||||||||||||||||||||||
John L. Plueger | 2010 | $ | 1,125,000 | $ | 1,250,000 | $ | 14,208,620 | $ | 7,600,283 | $ | 5,861 | $ | 24,189,764 | |||||||||||||||
President and Chief Operating Officer | ||||||||||||||||||||||||||||
Grant A. Levy | 2010 | $ | 506,439 | $ | 700,000 | $ | 3,000,000 | $ | 1,236,530 | $ | 3,262 | $ | 5,446,231 | |||||||||||||||
Executive Vice President, General Counsel and Secretary | ||||||||||||||||||||||||||||
Jie Chen | 2010 | $ | 343,750 | $ | 750,000 | $ | 3,000,000 | $ | 1,116,204 | $ | 1,817 | $ | 5,211,771 | |||||||||||||||
Executive Vice President and Managing Director of Asia | ||||||||||||||||||||||||||||
James C. Clarke | 2010 | $ | 149,352 | $ | 120,000 | $ | 300,000 | $ | 123,653 | $ | 62,563 | $ | 755,568 | |||||||||||||||
Senior Vice President and Chief Financial Officer | ||||||||||||||||||||||||||||
* | Stock awards consist of RSUs relating to shares of our Class A Common Stock. Option awards are options to purchase our Class A Common Stock. | |
(1) | Bonus: The amount for Mr. Udvar-Házy represents his annual bonus for 2010, and a $500,000 success bonus, described above under “Compensation discussion and analysis—Elements of the executive compensation program—Specific Purpose Awards.” All other figures represent annual bonuses for 2010. | |
(2) | Stock Awards and Option Awards: These amounts represent the aggregate grant date fair value of awards of RSUs and options to purchase shares of our Class A Common Stock granted to our Named Executive Officers in 2010, computed in accordance with GAAP. Assumptions used in the calculations of these amounts, which do not correspond to the actual value that may be realized by the Named Executive Officer, are included in Note 12 “Equity Based Compensation” to the financial statements included in this prospectus. | |
(3) | All Other Compensation: The amounts shown in this column reflect the following items: |
• | Premium Payments: In 2010, we paid premiums on term life insurance policies for Messrs. Udvar-Házy, Plueger, Levy, Chen and Clarke, in the aggregate amounts of $29,682, $5,861, $3,262, $1,817, and $2,563, respectively. | |
• | Relocation Assistance: In connection with Mr. Clarke’s hiring and relocation from Connecticut to Los Angeles, California, we paid Mr. Clarke an allowance of $60,000 for certain relocation and transitional costs. |
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Grant date | ||||||||||||||||||||
Estimated future | Exercise or | fair value | ||||||||||||||||||
payouts under | base price | of stock | ||||||||||||||||||
equity incentive | of option | and option | ||||||||||||||||||
Grant date(s) | plan awards | awards | awards | |||||||||||||||||
Name | (1) | Type of award | (#) | ($/sh)(2) | ($)(3) | |||||||||||||||
Mr. Udvar-Házy | 6/4/2010 | Options | 1,750,000 | $ | 20.00 | $ | 18,795,960 | |||||||||||||
6/4/2010 | RSUs | 1,750,000 | $ | 35,000,000 | ||||||||||||||||
8/11/2010 | Options | 1,352 | $ | 20.00 | $ | 11,168 | ||||||||||||||
8/11/2010 | RSUs | 426 | $ | 8,520 | ||||||||||||||||
Mr. Plueger | 6/4/2010 | Options | 700,000 | $ | 20.00 | $ | 7,518,384 | |||||||||||||
6/4/2010 | RSUs | 700,000 | $ | 14,000,000 | ||||||||||||||||
8/11/2010 | Options | 10,806 | $ | 20.00 | $ | 81,899 | ||||||||||||||
8/11/2010 | RSUs | 10,431 | $ | 208,620 | ||||||||||||||||
Mr. Levy | 7/14/2010 | Options | 150,000 | $ | 20.00 | $ | 1,236,530 | |||||||||||||
7/14/2010 | RSUs | 150,000 | $ | 3,000,000 | ||||||||||||||||
Mr. Chen | 8/11/2010 | Options | 150,000 | $ | 20.00 | $ | 1,116,204 | |||||||||||||
8/11/2010 | RSUs | 150,000 | $ | 3,000,000 | ||||||||||||||||
Mr. Clarke | 7/14/2010 | Options | 15,000 | $ | 20.00 | $ | 123,653 | |||||||||||||
7/14/2010 | RSUs | 15,000 | $ | 300,000 | ||||||||||||||||
(1) | Grant Date: The grant date for each award is the effective date of grant approved by the compensation committee of our board of directors. | |
(2) | Exercise or base price of option awards: The exercise price for each award is equal to the fair market value of our Class A Common Stock as of the date of grant, as determined by our board of directors and our compensation committee. | |
(3) | Grant date fair value of stock and option awards: The grant date fair value for each award is computed in accordance with GAAP. Assumptions used in the calculations of these amounts, which do not correspond to the actual value that may be realized by the Named Executive Officers, are included in Note 12 “Equity Based Compensation” to the financial statements included in this prospectus. |
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Option awards* | Stock awards* | |||||||||||||||||||||||
Equity | ||||||||||||||||||||||||
Equity incentive | incentive plan | |||||||||||||||||||||||
Equity incentive | plan awards: | awards: | ||||||||||||||||||||||
plan awards: | number of | market value | ||||||||||||||||||||||
number of | unearned | or payout value | ||||||||||||||||||||||
securities | shares, units | of unearned | ||||||||||||||||||||||
underlying | or other | shares, units or | ||||||||||||||||||||||
unexercised | Option | rights that | other rights | |||||||||||||||||||||
unearned | exercise | Option | have not | that have not | ||||||||||||||||||||
options | price | expiration | vested | vested | ||||||||||||||||||||
Name | Grant date | (#)(1) | ($) | date | (#)(2) | ($)(3) | ||||||||||||||||||
Mr. Udvar-Házy | 6/4/2010 | 1,750,000 | $ | 20.00 | 6/4/2020 | |||||||||||||||||||
6/4/2010 | 1,750,000 | $ | 35,000,000 | |||||||||||||||||||||
8/11/2010 | 1,352 | $ | 20.00 | 8/11/2020 | ||||||||||||||||||||
8/11/2010 | 426 | $ | 8,520 | |||||||||||||||||||||
Mr. Plueger | 6/4/2010 | 700,000 | $ | 20.00 | 6/4/2020 | |||||||||||||||||||
6/4/2010 | 700,000 | $ | 14,000,000 | |||||||||||||||||||||
8/11/2010 | 10,806 | $ | 20.00 | 8/11/2020 | ||||||||||||||||||||
8/11/2010 | 10,431 | $ | 208,620 | |||||||||||||||||||||
Mr. Levy | 7/14/2010 | 150,000 | $ | 20.00 | 7/14/2020 | |||||||||||||||||||
7/14/2010 | 150,000 | $ | 3,000,000 | |||||||||||||||||||||
Mr. Chen | 8/11/2010 | 150,000 | $ | 20.00 | 8/11/2020 | |||||||||||||||||||
8/11/2010 | 150,000 | $ | 3,000,000 | |||||||||||||||||||||
Mr. Clarke | 7/14/2010 | 15,000 | $ | 20.00 | 7/14/2020 | |||||||||||||||||||
7/14/2010 | 15,000 | $ | 300,000 | |||||||||||||||||||||
* | Shares underlying the Option Awards and Stock Awards are shares of Class A Common Stock. | |
(1) | Number of securities underlying unexercised unearned options: Option Awards under our 2010 ALC Equity Incentive Plan generally vest in equal installments over a three-year period. The options granted to Messrs. Udvar-Házy and Plueger on June 4, 2010 vest in equal installments on each of June 4, 2011, June 4, 2012 and June 4, 2013. All of the options granted to Messrs. Levy and Clarke and the options granted to Messrs. Udvar-Házy and Plueger on August 11, 2010 vest in equal installments on June 30, 2011, June 30, 2012 and June 30, 2013. The options granted to Mr. Chen vest 662/3% on June 30, 2011 and 331/3% on June 30, 2012. | |
(2) | Number of unearned shares, units or other rights that have not vested: The RSUs granted to Messrs. Udvar-Házy, Plueger, Levy and Clarke vest in cumulative installments as follows: |
• | The first tranche of 25% will vest on June 30, 2011, provided that our Company has attained at least 2% growth in book value per share over the book value as of June 30, 2010, as determined in accordance with GAAP; | |
• | The second tranche of 25% will vest, and any unvested portion of the first tranche will vest, on June 30, 2012, provided that our Company has attained at least 5.06% growth in book value per share over the book value as of June 30, 2010; | |
• | The third tranche of 25% will vest, and any unvested portion of the first and second tranches will vest, on June 30, 2013, provided that our Company has attained at least 9.26% growth in book value per share over the book value as of June 30, 2010; and | |
• | The fourth tranche of 25% will vest, and any unvested portion of the first, second and third tranches will vest, on June 30, 2014, or on any date thereafter up to and including June 30, 2015, provided that our Company has attained at least 13.63% growth in book value per share over the book value as of June 30, 2010. |
• | The first tranche of 50% will vest on June 30, 2011, provided that our Company has attained at least 2% growth in book value per share over the book value as of June 30, 2010, as determined in accordance with GAAP; |
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• | The second tranche of 50% will vest, and any unvested portion of the first tranche will vest, on June 30, 2012, provided that our Company has attained at least 5.06% growth in book value per share over the book value as of June 30, 2010; | |
• | Any unvested portion of the first and second tranches will vest on June 30, 2013, provided that our Company has attained at least 9.26% growth in book value per share over book value as of June 30, 2010; and | |
• | Any unvested portion of the first and second tranches will vest on June 30, 2014, or any date thereafter up to and including June 30, 2015, provided that our Company has attained at least 13.63% growth in book value per share over the book value as of June 30, 2010. |
(3) | Market Value of Unearned Shares, Units or Other Rights That Have Not Vested: The market value shown is based on the price of our Class A Common Stock on the relevant date of grant, which was $20.00 per share. |
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Voluntary | ||||||||||||||||
termination | ||||||||||||||||
without | Involuntary | |||||||||||||||
good reason/ | termination | Change in | ||||||||||||||
involuntary | without | Termination | control without | |||||||||||||
Executive payments and | termination | cause/for | due to death | a termination of | ||||||||||||
benefits upon termination | for cause | good reason | or disability | employment | ||||||||||||
Compensation severance | $ | 1,800,000 | (a) | $ | 9,900,000 | (b) | $ | 1,800,000 | (a) | $ | — | |||||
Amended and restated deferred bonus plan | $ | — | $ | 191,045 | (c) | $ | 191,045 | (c) | $ | — | ||||||
Acceleration of equity awards | ||||||||||||||||
RSUs | $ | — | $ | — | $ | — | $ | — | (d) | |||||||
Options | $ | — | $ | 18,807,128 | $ | 18,807,128 | $ | 18,807,128 | ||||||||
Benefits and perquisites | ||||||||||||||||
Term life insurance | $ | — | $ | 127,177 | (e) | $ | — | (f) | $ | — | ||||||
Benefits | $ | — | $ | 106,288 | (g) | $ | — | $ | — | |||||||
Total | $ | 1,800,000 | $ | 29,131,638 | $ | 20,798,173 | $ | 18,807,128 | ||||||||
(a) | Represents the amount of Mr. Udvar-Házy’s annual bonus for 2010. | |
(b) | Represents the aggregate of Mr. Udvar-Házy’s annual bonus for 2010, salary continuation at an annual rate of $1.8 million, and payments in 2011 and 2012 of amounts equal to the target annual bonus. | |
(c) | Represents 9.0% of the sum of Mr. Udvar-Házy’s actual salary paid and success bonus paid of $500,000. | |
(d) | Assumes that the compensation committee does not treat performance conditions for RSUs as met in the event that a change in control occurs on December 31, 2010. | |
(e) | Represents the premium payments on the group term and supplementary life insurance policies for Mr. Udvar-Házy that the Company would continue to pay. | |
(f) | The total amount payable under the group term and supplementary life insurance policies for Mr. Udvar-Házy is $5.3 million. | |
(g) | Represents health, dental and vision insurance premiums that would be paid by the Company for continued coverage, based on rates as of December 31, 2010. |
Voluntary | ||||||||||||||||
termination | ||||||||||||||||
without | Involuntary | |||||||||||||||
good reason/ | termination | Change in | ||||||||||||||
involuntary | without | Termination | control without | |||||||||||||
Executive payments and | termination | cause/for | due to death | a termination of | ||||||||||||
benefits upon termination | for cause | good reason | or disability | employment | ||||||||||||
Compensation severance | $ | 1,250,000 | (a) | $ | 7,400,000 | (b) | $ | 1,250,000 | (a) | $ | — | |||||
Amended and restated deferred bonus plan | $ | — | $ | 101,250 | (c) | $ | 101,250 | (c) | $ | — | ||||||
Acceleration of equity awards | ||||||||||||||||
RSUs | $ | — | $ | — | $ | — | $ | — | (d) | |||||||
Options | $ | — | $ | 7,600,283 | $ | 7,600,283 | $ | 7,600,283 | ||||||||
Benefits and perquisites | ||||||||||||||||
Term life insurance | $ | — | $ | 29,215 | (e) | $ | — | (f) | $ | — | ||||||
Benefits | $ | — | $ | 84,088 | (g) | $ | — | $ | — | |||||||
Total | $ | 1,250,000 | $ | 15,214,836 | $ | 8,951,533 | $ | 7,600,283 | ||||||||
(a) | Represents the amount of Mr. Plueger’s annual bonus for 2010. |
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(b) | Represents the aggregate of Mr. Plueger’s annual bonus for 2010, salary continuation at an annual rate of $1.5 million through June 30, 2013, and payments in 2011 and 2012 of amounts equal to the target annual bonus. | |
(c) | Represents 9.0% of Mr. Plueger’s actual salary paid for 2010. |
(d) | Assumes that the compensation committee does not treat performance conditions for RSUs as met in the event that a change in control occurs on December 31, 2010. | |
(e) | Represents the premium payments on the group term and supplementary life insurance policies for Mr. Plueger that the Company would continue to pay. | |
(f) | The total amount payable under the group term and supplementary life insurance policies for Mr. Plueger is $2.3 million. |
(g) | Represents health, dental and vision insurance premiums that would be paid by the Company for continued coverage, based on rates as of December 31, 2010. |
Voluntary | ||||||||||||||||
termination | ||||||||||||||||
without | Involuntary | |||||||||||||||
good reason/ | termination | Change in | ||||||||||||||
involuntary | without | Termination | control without | |||||||||||||
Executive payments and | termination | cause/for | due to death | a termination of | ||||||||||||
benefits upon termination | for cause | good reason | or disability | employment | ||||||||||||
Compensation severance | $ | — | $ | — | $ | — | $ | — | ||||||||
Amended and restated deferred bonus plan | $ | — | $ | — | $ | 43,047 | (a) | $ | — | |||||||
Acceleration of vesting of equity awards | ||||||||||||||||
RSUs | $ | — | $ | — | $ | — | $ | — | (b) | |||||||
Options | $ | — | $ | — | $ | 1,236,530 | $ | 1,236,530 | ||||||||
Benefits and perquisites | ||||||||||||||||
Term life insurance | $ | — | $ | — | $ | — | (c) | $ | — | |||||||
Benefits | $ | — | $ | — | $ | — | $ | — | ||||||||
Total | $ | — | $ | — | $ | 1,279,577 | $ | 1,236,530 | ||||||||
(a) | Represents 8.5% of Mr. Levy’s actual salary paid for 2010. | |
(b) | Assumes that the compensation committee does not treat performance conditions for RSUs as met in the event of a change in control on December 31, 2010. | |
(c) | The total amount payable under the group term life insurance policy for Mr. Levy is $300,000. |
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Voluntary | ||||||||||||||||
termination | ||||||||||||||||
without | Involuntary | |||||||||||||||
good reason/ | termination | Change in | ||||||||||||||
involuntary | without | Termination | control without | |||||||||||||
Executive payments and | termination | cause/for | due to death | a termination of | ||||||||||||
benefits upon termination | for cause | good reason | or disability | employment | ||||||||||||
Compensation severance | $ | — | $ | — | $ | — | $ | — | ||||||||
Amended and restated deferred bonus plan | $ | — | $ | — | $ | 29,219 | (a) | $ | — | |||||||
Acceleration of vesting of equity awards | ||||||||||||||||
RSUs | $ | — | $ | — | $ | — | $ | — | (b) | |||||||
Options | $ | — | $ | — | $ | 1,116,204 | $ | 1,116,204 | ||||||||
Benefits and perquisites | ||||||||||||||||
Term life insurance | $ | — | $ | — | $ | — | (c) | $ | — | |||||||
Benefits | $ | — | $ | — | $ | — | $ | — | ||||||||
Total | $ | — | $ | — | $ | 1,145,423 | $ | 1,116,204 | ||||||||
(a) | Represents 8.5% of Mr. Chen’s actual salary paid for 2010. | |
(b) | Assumes that the compensation committee does not treat performance conditions for RSUs as met in the event of a change in control on December 31, 2010. | |
(c) | The total amount payable under the group term life insurance policy for Mr. Chen is $300,000. |
Voluntary | ||||||||||||||||
termination | ||||||||||||||||
without | Involuntary | |||||||||||||||
good reason/ | termination | Change in | ||||||||||||||
involuntary | without | Termination | control without | |||||||||||||
Executive payments and | termination | cause/for | due to death | a termination of | ||||||||||||
benefits upon termination | for cause | good reason | or disability | employment | ||||||||||||
Compensation severance | $ | — | $ | — | $ | — | $ | — | ||||||||
Amended and restated deferred bonus plan | $ | — | $ | — | $ | 10,455 | (a) | $ | — | |||||||
Acceleration of vesting of equity awards | ||||||||||||||||
RSUs | $ | — | $ | — | $ | — | $ | — | (b) | |||||||
Options | $ | — | $ | — | $ | 123,653 | $ | 123,653 | ||||||||
Benefits and perquisites | ||||||||||||||||
Term life insurance | $ | — | $ | — | $ | — | (c) | $ | — | |||||||
Benefits | $ | — | $ | — | $ | — | $ | — | ||||||||
Total | $ | — | $ | — | $ | 134,108 | $ | 123,653 | ||||||||
(a) | Represents 7.0% of Mr. Clarke’s actual salary paid for 2010. | |
(b) | Assumes that the compensation committee does not treat performance conditions for RSUs as met in the event of a change in control on December 31, 2010. | |
(c) | The total amount payable under the group term life insurance policy for Mr. Clarke is $300,000. |
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Fees earned or | ||||
paid in cash | ||||
Name | ($)(1) | |||
Mr. Danhakl | $ | 83,250 | ||
Mr. Hart | $ | 95,250 | ||
Mr. Milton | $ | 100,583 | ||
Mr. Péretié | $ | 51,500 | ||
Mr. Ressler | $ | 83,250 | ||
Mr. Ross | $ | 26,500 | ||
Mr. Saines | $ | 79,500 | ||
Dr. Sugar | $ | 92,250 | ||
(1) | Fees Earned or Paid in Cash: The amount shown for each non-employee director is comprised of his annual retainer fees, committee and/or chairmanship fees, and meeting fees. |
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• | each person known by us to beneficially own more than five percent of our Common Stock; |
• | each of our named executive officers; |
• | each of our directors; and |
• | all of our executive officers and directors as a group. |
Class A Common | Class B Non-Voting | Warrants to purchase | ||||||||||||||||||||||
Stock | Common Stock | shares of | ||||||||||||||||||||||
Number of shares | Number of shares | Common | ||||||||||||||||||||||
Name of beneficial owner | beneficially owned(1) | % | beneficially owned(1) | % | Stock | Total % | ||||||||||||||||||
Greater than 5% Stockholders | ||||||||||||||||||||||||
Ares Management LLC(2) | 6,944,444 | 7.02% | — | 0.00% | — | 6.90% | ||||||||||||||||||
Commonwealth Bank of Australia(3) | 6,970,653 | 7.05% | — | 0.00% | 268,125 | 7.17% | ||||||||||||||||||
Genefinance S.A.(4) | 3,170,661 | 3.21% | 1,829,339 | 100.00% | 214,500 | 5.17% | ||||||||||||||||||
Leonard Green & Partners, L.P.(5) | 6,944,444 | 7.02% | — | 0.00% | — | 6.90% | ||||||||||||||||||
Steven F. Udvar-Házy(6) | 5,401,522 | 5.43% | — | 0.00% | — | 5.33% | ||||||||||||||||||
Named Executive Officers and Directors | ||||||||||||||||||||||||
Steven F. Udvar-Házy(6) | 5,401,522 | 5.43% | — | 0.00% | — | 5.33% | ||||||||||||||||||
John L. Plueger(7) | 617,416 | * | — | 0.00% | — | * | ||||||||||||||||||
Grant A. Levy(12) | 154,200 | * | — | 0.00% | — | * | ||||||||||||||||||
Jie Chen(13) | 146,302 | * | — | 0.00% | — | * | ||||||||||||||||||
James C. Clarke(8) | 11,038 | * | — | 0.00% | — | * | ||||||||||||||||||
John G. Danhakl(5) | 6,944,444 | 7.02% | — | 0.00% | — | 6.90% | ||||||||||||||||||
Matthew J. Hart | 10,000 | * | — | 0.00% | — | * | ||||||||||||||||||
Robert A. Milton | 182,000 | * | — | 0.00% | — | * | ||||||||||||||||||
Michel M.R.G. Péretié(4) | 3,170,661 | 3.21% | 1,829,339 | 100.00% | 214,500 | 5.17% | ||||||||||||||||||
Antony P. Ressler(2)(9) | 6,944,444 | 7.02% | — | 0.00% | — | 6.90% | ||||||||||||||||||
Wilbur L. Ross, Jr.(10) | 4,250,000 | 4.30% | — | 0.00% | — | 4.22% | ||||||||||||||||||
Ian M. Saines(3) | 6,970,653 | 7.05% | — | 0.00% | 268,125 | 7.17% | ||||||||||||||||||
Dr. Ronald D. Sugar(11) | 50,000 | * | — | 0.00% | — | * | ||||||||||||||||||
All executive officers and directors as a group (17 persons)(14) | 35,192,019 | 35.20% | 1,829,339 | 100.00% | 482,625 | 36.67% | ||||||||||||||||||
* | Represents beneficial ownership of less than 1%. | |
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(1) | Excludes warrants, which are exercisable for Class A Common Stock or Class B Non-Voting Common Stock. These warrants are listed in a separate column. | |
(2) | Consists of 5,555,556 shares of Class A Common Stock held by Ares Corporate Opportunities Fund III, L.P. (“ACOF III”), 724,947 shares of Class A Common Stock held by Ares Special Situations Fund, L.P. (“ASSF”) and 663,941 shares of Class A Common Stock held by Ares Special SituationsFund I-B, L.P. (“ASSF I-B”). The general partner of ACOF III is ACOF Management III, L.P. (“ACOF Management”) and the general partner of ACOF Management is ACOF Operating Manager III, LLC (“ACOF Operating Manager”). The general partner of ASSF and ASSF I-B is ASSF Management, L.P. (“ASSF Management”) and the general partner of ASSF Management is ASSF Operating Manager, LLC (“ASSF Operating Manager”). Each of ACOF Management, ACOF Operating Manager, ASSF Management and ASSF Operating Manager are directly or indirectly controlled by Ares Management LLC (“Ares Management”), which, in turn, is indirectly controlled by Ares Partners Management Company LLC (“Ares Parent,” and together with Ares Management, ACOF III, ACOF Management, ACOF Operating Manager, ASSF, ASSF I-B, ASSF Management and ASSF Operating Manager, the “Ares Entities”). Ares Parent is managed by an executive committee comprised of Mr. Ressler, Michael Arougheti, David Kaplan, Greg Margolies and Bennett Rosenthal. Each of the Ares Entities (other than ACOF III, ASSF and ASSF I-B, with respect to the shares held directly by ACOF III, ASSF and ASSF I-B, respectively) and the members of the executive committee and the partners, members and managers of the Ares Entities expressly disclaims beneficial ownership of these shares of Class A Common Stock. The address of each Ares Entity is 2000 Avenue of the Stars, 12th Floor, Los Angeles, California 90067. | |
(3) | Commonwealth Bank of Australia is the direct beneficial owner of 6,250,000 shares of Class A Common Stock and one warrant to purchase up to 268,125 shares of Common Stock. Commonwealth Bank of Australia also may be deemed to be the beneficial owner of 720,653 shares of Class A Common Stock purchased for the accounts of certain clients of First State Investment Management (UK) Limited (“FSIM”) and its direct, wholly-owned subsidiary, First State Investments International Limited (“FSII”), both of which are indirect, wholly-owned subsidiaries of Commonwealth Bank of Australia. FSIM and FSII may be deemed to be the beneficial owners of the shares held in the accounts of their respective clients by virtue of their voting and investment control over such shares in their capacity as investment advisers to such clients. Mr. Saines does not directly hold any shares or warrants in the Company. As Group Executive of the Institutional Banking and Markets Division of Commonwealth Bank of Australia, Mr. Saines may be deemed to be the beneficial owner of some or all of the foregoing shares; however, Mr. Saines disclaims beneficial ownership of these shares of Class A Common Stock and the warrant, except to the extent of his pecuniary interest therein. The address of Commonwealth Bank of Australia is Level 21, 201 Sussex Street, Sydney, Australia NSW 2000. | |
(4) | Consists of 3,170,661 shares of Class A Common Stock, 1,829,339 shares of Class B Non-Voting Common Stock and one warrant to purchase 214,500 shares of Common Stock all held by Genefinance S.A. Genefinance S.A. is a wholly-owned subsidiary of Société Générale S.A. Société Générale S.A. may be deemed to have shared voting and investment power with respect to these shares of Common Stock and the warrant held by Genefinance S.A. Mr. Péretié does not directly hold any shares or warrants in the Company. As a member of an executive committee of Société Générale S.A., Mr. Péretié may be deemed to be the beneficial owner of the shares of Common Stock and the warrant held by Genefinance S.A. Mr. Péretié disclaims beneficial ownership of these shares of Common Stock and the warrant, except to the extent of his pecuniary interest therein. The address for Genefinance S.A. and Société Générale S.A. is 29 Boulevard Haussmann, 75009 Paris, France. | |
(5) | Consists of 5,341,979 shares of Class A Common Stock held by Green Equity Investors V, L.P. (“GEI V”) and 1,602,465 shares of Class A Common Stock held by Green Equity Investors Side V, L.P. (“GEI Side V”). GEI Capital V, LLC (the general partner of GEI V and GEI Side V), Green V Holdings, LLC (a limited partner of GEI V), Leonard Green & Partners, L.P. (an affiliate of GEI Capital V, LLC) and LGP Management, Inc. (the general partner of Leonard Green & Partners, L.P.) all may be deemed to have shared voting and investment power with respect to the shares of Class A Common Stock beneficially owned by GEI V and GEI Side V. As such they may be deemed to have shared beneficial ownership of such shares of Common Stock. Each of Mr. Danhakl, the other managers of GEI Capital V, LLC, GEI Capital V, LLC, Green V Holdings, LLC, Leonard Green & Partners, L.P. and LGP Management, Inc. disclaims beneficial ownership of the shares of Class A Common Stock reported herein, except to the extent of their pecuniary interest therein. The address for each of GEI V, GEI Side V, GEI Capital V, LLC, Green V Holdings, LLC, Leonard Green & Partners, L.P. and LGP Management, Inc. is 11111 Santa Monica Boulevard, Suite 2000, Los Angeles, California 90025. | |
(6) | Consists of 253,333 shares of Class A Common Stock held directly by Mr. Udvar-Házy; 278,889 shares of Class A Common Stock held directly by Air Intercontinental, Inc.; 101,667 shares of Class A Common Stock held directly by Ocean Equities, Inc.; 35,925 shares of Class A Common Stock held directly by Emerald Financial LLC; 2,700,000 and 1,044,225 shares of Class A Common Stock held directly by two trusts, respectively, of which Mr. Udvar-Házy is the trustee and has sole voting and investment power; 300,000 shares of Class A Common Stock held directly by AL Investors I, LLC; 103,700 shares of Class A Common Stock held directly in the aggregate by Mr. Udvar-Házy’s wife and children; and 583,783 options to purchase Class A Common Stock held directly by Mr. Udvar-Házy that are exercisable within 60 days of June 30, 2011. Mr. Udvar-Házy has sole voting and investment power with respect to the shares held by Air Intercontinental, Inc., of which he is the sole stockholder and one of three directors. The remaining directors, Christine L. Udvar-Házy, his wife, and Steven C. Udvar-Házy, his son, disclaim beneficial ownership of the shares held by Air Intercontinental, Inc., except to the extent of their respective pecuniary interests therein. Mr. Udvar-Házy has sole voting and investment power with respect to the shares held by Ocean Equities, Inc. A trust of which Mr. Udvar-Házy is the trustee is the sole stockholder of Ocean Equities, Inc., and Mr. Udvar-Házy is one of the three directors. The remaining directors, Mrs. Udvar-Házy and Mr. S. C. Udvar-Házy, disclaim beneficial ownership of the shares held by Ocean Equities, Inc., except to the extent of their respective pecuniary interests therein. Mr. Udvar-Házy shares voting and investment power with respect to the shares of Class A Common Stock held by Emerald Financial LLC. A trust of which he is trustee controls a majority of the membership interests in Emerald Financial LLC; in addition, Mr. Udvar-Házy is one of three managers of Emerald Financial LLC, together with Mrs. Udvar-Házy and Karissa K. Udvar-Házy. Mrs. Udvar-Házy and Ms. Udvar-Házy disclaim beneficial ownership of the shares held by Emerald Financial LLC, except to the extent of their respective pecuniary interests therein. Mr. Udvar-Házy has shared voting and investment power over the shares held by AL Investors I, LLC. The members of AL Investors I, LLC are AL 1 Management, LLC, AL Investment Group LLC, and Biscayne 4400 AL, LLC. AL 1 Management, LLC and AL Investment Group LLC each has the power to designate a co-manager of AL Investors I, LLC, and has designated itself as such. Mr. Udvar-Házy is the sole member and manager of AL 1 Management, LLC. Mr. Udvar-Házy disclaims beneficial ownership of the shares held directly by his wife and children, except to the extent of his pecuniary interest therein. |
129
(7) | Consists of 101,147 shares of Class A Common Stock held by Mr. Plueger; 278,334 shares of Class A Common Stock held by a trust of which Mr. Plueger is a co-trustee; 1,000 shares of Class A Common Stock held directly in the aggregate by Mr. Plueger’s children; and 236,935 options to purchase Class A Common Stock held directly by Mr. Plueger that are exercisable within 60 days of June 30, 2011. Mr. Plueger disclaims beneficial ownership of the shares held directly by his children, except to the extent of his pecuniary interest therein. | |
(8) | Consists of 3,788 shares of Class A Common Stock held by Mr. Clarke; 2,250 shares of Class A Common Stock held by RBC Capital Markets, LLC for the benefit of James C. Clarke, of which Mr. Clarke is the sole owner and beneficiary; and 5,000 options to purchase Class A Common Stock held directly by Mr. Clarke that are exercisable within 60 days of June 30, 2011. | |
(9) | Mr. Ressler is a Senior Partner in the Private Equity Group of Ares Management and a member of Ares Parent, both of which indirectly control ACOF III, ASSF and ASSF I-B (collectively, the “Ares Funds”). Mr. Ressler expressly disclaims beneficial ownership of the shares of Class A Common Stock held by the Ares Funds. The address of Mr. Ressler isc/o Ares Management LLC, 2000 Avenue of the Stars, 12th Floor, Los Angeles, California 90067. | |
(10) | Consists of 4,233,000 shares of Class A Common Stock held by WLR Recovery Fund IV, L.P. and 17,000 shares of Class A Common Stock held by WLR IV Parallel ESC, L.P. Mr. Ross is the Chairman and CEO of WL Ross & Company LLC and the managing member of El Vedado LLC, the general partner of WL Ross Group, L.P., which is in turn the managing member of WLR Recovery Associates IV LLC, which is the general partner of WLR Recovery Fund IV, L.P. Invesco Private Capital, Inc. is the managing member of Invesco WLR IV Associates LLC, which is in turn the general partner of WLR IV Parallel ESC, L.P. Invesco WLR IV Associates LLC and WLR Recovery Associates IV LLC have agreed to make investments for WLR IV Parallel ESC, L.P. on a pro rata basis in parallel with WLR Recovery Fund IV, L.P. Invesco WLR IV Associates LLC, Invesco Private Capital, Inc., WLR Recovery Associates IV LLC, WL Ross Group, L.P., El Vedado LLC and Mr. Ross may be deemed to share voting and dispositive power over the shares of Class A Common Stock held by WLR Recovery Fund IV, L.P. and WLR IV Parallel ESC, L.P. Mr. Ross disclaims beneficial ownership over these shares of Class A Common Stock, except to the extent of his pecuniary interest therein. The address for WL Ross Group, L.P. is 1166 Avenue of the Americas, New York, New York 10036. | |
(11) | Consists of 50,000 shares of Class A Common Stock held by a trust of which Dr. Sugar is a co-trustee. | |
(12) | Consists of 102,700 shares of Class A Common Stock held by Mr. Levy; 50,000 options to purchase Class A Common Stock held by Mr. Levy that are exercisable within 60 days of June 30, 2011; and 1,500 shares of Class A Common Stock held directly in the aggregate by Mr. Levy’s children. Mr. Levy disclaims beneficial ownership of the shares held directly by his children, except to the extent of his pecuniary interest therein. | |
(13) | Consists of 46,302 shares of Class A Common Stock held by Mr. Chen; and 100,000 options to purchase Class A Common Stock held by Mr. Chen that are exercisable within 60 days of June 30, 2011. | |
(14) | Includes 1,082,384 options to purchase Class A Common Stock held in the aggregate by the executive officers of the Company that are exercisable within 60 days of June 30, 2011. | |
130
131
Beneficial Ownership | Number of | Beneficial Ownership | ||||||||||||||||||
Before Resale | shares offered | After Resale (93) | ||||||||||||||||||
Class A Common Stock | pursuant to | Class A Common Stock | ||||||||||||||||||
Number of | this | Number of | ||||||||||||||||||
Name of selling stockholder | shares | % | prospectus | shares | % | |||||||||||||||
8 Marzo 91 s.r.l. (1) | 150,000 | * | 150,000 | — | * | |||||||||||||||
Air Intercontinental, Inc. (2)(83) | 278,889 | * | 278,889 | — | * | |||||||||||||||
AL Investors I, LLC (3)(83) | 300,000 | * | 300,000 | — | * | |||||||||||||||
Aletheia Insider Index I, L.P. (4) | 27,430 | * | 27,430 | — | * | |||||||||||||||
Aletheia Insider Index II, L.P. (4) | 40,070 | * | 40,070 | — | * | |||||||||||||||
Aletheia Research and Management, Inc. (4) | 15,000 | * | 15,000 | — | * | |||||||||||||||
American Funds Insurance Series — Growth Fund (5)(‡) | 4,183,448 | 4.25 | % | 4,183,448 | — | * | ||||||||||||||
ANT Capital Ltd (6) | 50,000 | * | 50,000 | — | * | |||||||||||||||
Ares Corporate Opportunities Fund III, L.P. (7) | 5,555,556 | 5.65 | % | 5,555,556 | — | * | ||||||||||||||
Ares Special Situations Fund, L.P. (7) | 724,947 | * | 724,947 | — | * | |||||||||||||||
Ares Special Situations Fund I-B, L.P. (7) | 663,941 | * | 663,941 | — | * | |||||||||||||||
Baer, Marc H. (8) | 119,511 | * | 70,178 | 49,333 | * | |||||||||||||||
Barclays Bank PLC (9) | 500,000 | * | 500,000 | — | * | |||||||||||||||
Barrow, James P. | 75,000 | * | 50,000 | 25,000 | * | |||||||||||||||
Bernstein, Todd M. (10)(‡) | 500 | * | 500 | — | * | |||||||||||||||
BlackRock Corporate High Yield Fund III, Inc. (11)(‡) | 12,900 | * | 12,900 | — | * | |||||||||||||||
BlackRock Corporate High Yield Fund V, Inc. (11)(‡) | 19,100 | * | 19,100 | — | * | |||||||||||||||
BlackRock Funds II — High Yield Bond Portfolio (11)(‡) | 118,000 | * | 118,000 | — | * | |||||||||||||||
Bombardier Inc. (12) | 2,500,000 | 2.54 | % | 2,500,000 | — | * | ||||||||||||||
Bowie, David Martin (13)(‡) | 500 | * | 500 | — | * | |||||||||||||||
Butte, Inc. (14) | 250,000 | * | 250,000 | — | * | |||||||||||||||
Calm Waters Partnership (15) | 50,000 | * | 50,000 | — | * | |||||||||||||||
Carol Cove Investments, LLC (16) | 500,000 | * | 500,000 | — | * | |||||||||||||||
Champagne Capital SAS (17) | 5,000 | * | 5,000 | — | * | |||||||||||||||
Charles M. Levy, a Professional Corporation Profit Sharing Plan (18) | 37,500 | * | 37,500 | — | * | |||||||||||||||
Chiang, Edmund P. (19)(‡) | 2,500 | * | 2,500 | — | * | |||||||||||||||
Clarke, James C. (20) | 8,528 | * | 2,528 | 6,000 | * | |||||||||||||||
COM Investments, LLC (21) | 1,000,000 | 1.02 | % | 1,000,000 | — | * |
132
Beneficial Ownership | Number of | Beneficial Ownership | ||||||||||||||||||
Before Resale | shares offered | After Resale (93) | ||||||||||||||||||
Class A Common Stock | pursuant to | Class A Common Stock | ||||||||||||||||||
Number of | this | Number of | ||||||||||||||||||
Name of selling stockholder | shares | % | prospectus | shares | % | |||||||||||||||
Commonwealth Bank of Australia (22)(‡) | 7,218,125 | 7.32 | % | 6,518,125 | 700,000 | * | ||||||||||||||
Courtenay-Evans, Georgina Fay | 750 | * | 750 | — | * | |||||||||||||||
Credit Suisse Securities (USA) LLC (23)(†) | 600,000 | * | 600,000 | — | * | |||||||||||||||
DBX Convertible Arbitrage 13 Fund (24) | 113,600 | * | 113,600 | — | * | |||||||||||||||
DeMartino, Geoffrey F. (19)(‡) | 1,250 | * | 1,250 | — | * | |||||||||||||||
Eichler, Jr., Peter J., Trustee FBO Peter and Christy Eichler Family Trust UAD 1/23/07 (4)(‡) | 17,500 | * | 17,500 | — | * | |||||||||||||||
Emerald Financial LLC (25)(83) | 35,925 | * | 35,925 | — | * | |||||||||||||||
Emerson, J. Steven IRA R/O II | 87,000 | * | 87,000 | — | * | |||||||||||||||
Emerson, J. Steven Roth IRA | 74,000 | * | 58,000 | 16,000 | * | |||||||||||||||
Emerson Partners (26) | 29,500 | * | 25,000 | 4,500 | * | |||||||||||||||
Erdelji, Gerhard (27)(‡) | 1,000 | * | 1,000 | — | * | |||||||||||||||
Felman, David Samuel (19)(‡) | 1,250 | * | 1,250 | — | * | |||||||||||||||
Fidelity Advisor Series I: Fidelity Advisor Large Cap Fund (28)(‡) | 107,000 | * | 80,200 | 26,800 | * | |||||||||||||||
Fidelity Commonwealth Trust: Fidelity Large Cap Stock Fund (28)(‡) | 95,600 | * | 73,000 | 22,600 | * | |||||||||||||||
Fidelity Contrafund: Fidelity Advisor New Insights Fund (28)(‡) | 672,800 | * | 320,800 | 352,000 | * | |||||||||||||||
Fidelity Contrafund: Fidelity Contrafund (28)(‡) | 3,214,800 | 3.27 | % | 1,624,500 | 1,590,300 | 1.62 | % | |||||||||||||
Fidelity Financial Trust: Fidelity Independence Fund (28)(‡) | 898,800 | * | 500,600 | 398,200 | * | |||||||||||||||
Fourth Avenue Capital Partners LP (29) | 150,000 | * | 150,000 | — | * | |||||||||||||||
Freshford Master Fund, Ltd (30) | 25,400 | * | 25,400 | — | * | |||||||||||||||
Freshford Partners, LP (31) | 74,600 | * | 74,600 | — | * | |||||||||||||||
Galex Ltd, LP (32) | 4,727 | * | 4,727 | — | * | |||||||||||||||
Genefinance S.A. (33)(‡) | 3,385,161 | 3.43 | % | 3,385,161 | — | * | ||||||||||||||
Gommeren, Kristiaan Franciscus | 50,000 | * | 50,000 | — | * | |||||||||||||||
Green Equity Investors V, L.P. (34) | 5,341,979 | 5.43 | % | 5,341,979 | — | * | ||||||||||||||
Green Equity Investors Side V, L.P. (34) | 1,602,465 | 1.63 | % | 1,602,465 | — | * | ||||||||||||||
Hart, Matthew J. (35) | 10,000 | * | 10,000 | — | * | |||||||||||||||
Házy Family Community Trust 5/28/85 (36)(83) | 2,700,000 | 2.74 | % | 2,700,000 | — | * | ||||||||||||||
HighVista I Limited Partnership (37) | 252,412 | * | 252,412 | — | * | |||||||||||||||
HighVista II Limited Partnership (37) | 178,393 | * | 178,393 | — | * | |||||||||||||||
HighVista III, Ltd. (38) | 60,753 | * | 60,753 | — | * | |||||||||||||||
HighVista V Limited Partnership (37) | 8,442 | * | 8,442 | — | * | |||||||||||||||
Hill, Blake A. (39)(‡) | 3,000 | * | 3,000 | — | * | |||||||||||||||
IAM Mini-Fund 21 Limited (24) | 51,200 | * | 51,200 | — | * | |||||||||||||||
J. Ralph and Cheri B. Atkin Living Trust, dated Nov. 2, 1999 (40) | 5,000 | * | 5,000 | — | * | |||||||||||||||
Jamal, Zul (19)(‡) | 2,500 | * | 2,500 | — | * | |||||||||||||||
KBW Financial Services Master Fund, Ltd. (41)(‡) | 325,000 | * | 325,000 | — | * | |||||||||||||||
Kemp, Arlynn T. Roth IRA | 1,871 | * | 1,871 | — | * | |||||||||||||||
Kemp, Gregory A. Roth IRA | 5,902 | * | 5,902 | — | * |
133
Beneficial Ownership Before Resale | Number of shares offered | Beneficial Ownership After Resale (93) | ||||||||||||||||||
Class A Common Stock | pursuant to | Class A Common Stock | ||||||||||||||||||
Number of | this | Number of | ||||||||||||||||||
Name of selling stockholder | shares | % | prospectus | shares | % | |||||||||||||||
Khatibi, Alex A. (42) | 119,511 | * | 70,178 | 49,333 | * | |||||||||||||||
Kiraz 1 Gayrimenkul Ve Yatirim Danismanligi Anonim Sirketi (43) | 2,500,000 | 2.54 | % | 2,500,000 | – | * | ||||||||||||||
Klein, Barak M. (19)(‡) | 2,000 | * | 2,000 | – | * | |||||||||||||||
Kobayashi, Ko (19)(‡) | 2,500 | * | 2,500 | – | * | |||||||||||||||
KORE Fixed Income Fund, Ltd (44) | 125,000 | * | 125,000 | – | * | |||||||||||||||
Kournetas, Nicholas G. (19)(‡) | 6,250 | * | 6,250 | – | * | |||||||||||||||
LabMorgan Corporation (45)(‡) | 1,000,000 | 1.02 | % | 1,000,000 | – | * | ||||||||||||||
LAC, LC (46) | 12,500 | * | 12,500 | – | * | |||||||||||||||
Lai, Stanley Philip (19)(‡) | 1,250 | * | 1,250 | – | * | |||||||||||||||
Lee, Kiley Kim (19)(‡) | 1,250 | * | 1,250 | – | * | |||||||||||||||
Levy, Grant A. (47) | 131,800 | * | 80,300 | 51,500 | * | |||||||||||||||
Levy Family Trust of 1997 f/b/o Lyda A. Levy, as her separate property (48) | 12,500 | * | 12,500 | – | * | |||||||||||||||
Mahmoodzadegan-Gappy Trust (19)(49)(‡) | 5,000 | * | 5,000 | – | * | |||||||||||||||
Malta Hedge Fund, L.P. (50) | 19,700 | * | 19,700 | – | * | |||||||||||||||
Malta Hedge Fund II, L.P. (50) | 115,400 | * | 115,400 | – | * | |||||||||||||||
Malta Offshore, Ltd. (51) | 39,300 | * | 39,300 | – | * | |||||||||||||||
Malta Partners, L.P. (50) | 5,600 | * | 5,600 | – | * | |||||||||||||||
Matza, Robert | 7,500 | * | 7,500 | – | * | |||||||||||||||
McCann, Daniel Anthony (13)(52)(‡) | 1,000 | * | 1,000 | – | * | |||||||||||||||
Miller Qualified Investments LLC (53) | 12,500 | * | 12,500 | – | * | |||||||||||||||
Milton, Robert A. (35) | 182,000 | * | 182,000 | – | * | |||||||||||||||
Moelis & Company LLC (54)(†) | 54,000 | * | 54,000 | – | * | |||||||||||||||
Moran, Jeffrey J. & Terry F. JTWROS | 75,000 | * | 75,000 | – | * | |||||||||||||||
Naggar, Joseph and Kate | 5,000 | * | 5,000 | – | * | |||||||||||||||
Nomura Waterstone Market Neutral Fund (24) | 11,500 | * | 11,500 | – | * | |||||||||||||||
Ocean Equities, Inc. (55)(83) | 101,667 | * | 101,667 | – | * | |||||||||||||||
Pairstech Premium Fund (56) | 20,000 | * | 15,000 | 5,000 | * | |||||||||||||||
Perrone, William | 1,000 | * | 1,000 | – | * | |||||||||||||||
Plueger Family Trust (57) | 278,334 | * | 278,334 | – | * | |||||||||||||||
Poerschke, John D. (58) | 30,862 | * | 25,862 | 5,000 | * | |||||||||||||||
Pothier, David | 5,000 | * | 5,000 | – | * | |||||||||||||||
PPM America Private Equity Fund III LP (59)(‡) | 1,500,000 | 1.52 | % | 1,500,000 | – | * | ||||||||||||||
Prime Capital Master SPC - GOT WAT MAC Segregated Portfolio (24) | 34,800 | * | 34,800 | – | * | |||||||||||||||
Putnam Variable Trust - Putnam VT Voyager Fund (60)(‡) | 34,828 | * | 34,828 | – | * | |||||||||||||||
Putnam Voyager Fund (60)(‡) | 140,172 | * | 140,172 | – | * | |||||||||||||||
Quintessence Fund L.P. (61) | 120,350 | * | 120,350 | – | * | |||||||||||||||
QVT Fund LP (61) | 1,129,650 | 1.15 | % | 1,129,650 | – | * | ||||||||||||||
R3 Capital Partners Master, L.P. (11)(‡) | 500,000 | * | 500,000 | – | * | |||||||||||||||
Rathbun, Joel Robert (19)(‡) | 1,500 | * | 1,500 | – | * |
134
Beneficial Ownership | Number of | Beneficial Ownership | ||||||||||||||||||
Before Resale | shares offered | After Resale (93) | ||||||||||||||||||
Class A Common Stock | pursuant to | Class A Common Stock | ||||||||||||||||||
Number of | this | Number of | ||||||||||||||||||
Name of selling stockholder | shares | % | prospectus | shares | % | |||||||||||||||
Reicon Direct Investments 7, LLC (62) | 25,000 | * | 25,000 | — | * | |||||||||||||||
Ricks Holdings, LLC (63) | 50,000 | * | 50,000 | — | * | |||||||||||||||
RRRR Investments, LLC (64) | 50,000 | * | 50,000 | — | * | |||||||||||||||
Samuelian Family Trust, Dated 11-2-07 (65) | 25,000 | * | 25,000 | — | * | |||||||||||||||
Sasso Family Trust (91)(‡) | 1,250 | * | 1,250 | — | * | |||||||||||||||
Scott J. Seymour and Kathleen T. Goette Seymour Family Trust dated 18 Jan. 1995 (66) | 17,500 | * | 10,000 | 7,500 | * | |||||||||||||||
Singer Associates (67) | 2,500 | * | 2,500 | — | * | |||||||||||||||
SM ALC, LLC (68) | 75,000 | * | 75,000 | — | * | |||||||||||||||
SOAM Azul I, LLC (69) | 45,000 | * | 45,000 | — | * | |||||||||||||||
SOAM Capital Partners, L.P. (70) | 200,000 | * | 200,000 | — | * | |||||||||||||||
Sorenson Capital Partners, L.P. (71) | 720,025 | * | 720,025 | — | * | |||||||||||||||
Sorenson Capital Partners II, L.P. (72) | 166,079 | * | 166,079 | — | * | |||||||||||||||
Steven F. Udvar-Házy Separate Property Trust (36)(83) | 1,044,225 | 1.06 | % | 1,043,125 | 1,100 | * | ||||||||||||||
Sugar Family Trust UAD 7/19/2001 (73) | 50,000 | * | 50,000 | — | * | |||||||||||||||
Sunrise Partners Limited Partnership (74)(‡) | 291,495 | * | 250,000 | 41,495 | * | |||||||||||||||
Tatung Company of America, Inc. (75) | 12,500 | * | 12,500 | — | * | |||||||||||||||
The Christopher Binyon Sarofim 1996 Trust (76) | 75,000 | * | 75,000 | — | * | |||||||||||||||
The Cranley Trust (77) | 250,000 | * | 250,000 | — | * | |||||||||||||||
The Moelis Family Trust (78)(‡) | 12,500 | * | 12,500 | — | * | |||||||||||||||
The Obsidian Master Fund (11)(‡) | 100,000 | * | 100,000 | — | * | |||||||||||||||
The Raich Trust dated September 17, 2001 (79)(‡) | 5,000 | * | 5,000 | — | * | |||||||||||||||
Tuckman, Adam | 2,500 | * | 2,500 | — | * | |||||||||||||||
Udvar-Házy, Christine L. (80)(83) | 52,500 | * | 51,000 | 1,500 | * | |||||||||||||||
Udvar-Házy, Courtney C. (81)(83) | 10,300 | * | 10,000 | 300 | * | |||||||||||||||
Udvar-Házy, Karissa K. (81)(83) | 12,800 | * | 12,500 | 300 | * | |||||||||||||||
Udvar-Házy, Steven C. (82)(83) | 17,800 | * | 17,500 | 300 | * | |||||||||||||||
Udvar-Házy, Trenton S. (82)(83) | 10,300 | * | 10,000 | 300 | * | |||||||||||||||
Variable Insurance Products Fund V: Asset Manager: Growth Portfolio (28)(‡) | 20,000 | * | 10,900 | 9,100 | * | |||||||||||||||
Variable Insurance Products Fund V: Asset Manager Portfolio (28)(‡) | 108,000 | * | 59,100 | 48,900 | * | |||||||||||||||
Wagner, Leon | 12,500 | * | 12,500 | — | * | |||||||||||||||
Waterstone Market Neutral MAC 51 Ltd. (24) | 148,900 | * | 148,900 | — | * | |||||||||||||||
Waterstone Market Neutral Master Fund Ltd. (24) | 1,067,600 | 1.09 | % | 1,067,600 | — | * | ||||||||||||||
Waterstone MF Fund, Ltd. (24) | 197,400 | * | 197,400 | — | * | |||||||||||||||
West Rim Capital Investment Partners, L.P. (84) | 21,335 | * | 21,335 | — | * | |||||||||||||||
West Rim Capital Investment Partners II, L.P. (85) | 17,032 | * | 17,032 | — | * | |||||||||||||||
West Rim Capital Partners II, L.P. (86) | 506,332 | * | 506,332 | — | * |
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Beneficial Ownership | Number of | Beneficial Ownership | ||||||||||||||||||
Before Resale | shares offered | After Resale (93) | ||||||||||||||||||
Class A Common Stock | pursuant to | Class A Common Stock | ||||||||||||||||||
Number of | this | Number of | ||||||||||||||||||
Name of selling stockholder | shares | % | prospectus | shares | % | |||||||||||||||
West Rim Capital Partners II-A, L.P. (86) | 18,334 | * | 18,334 | — | * | |||||||||||||||
West Rim Capital Partners II-B, L.P. (86) | 42,223 | * | 42,223 | — | * | |||||||||||||||
West Rim Capital Special Investors, LLC (87) | 1,440 | * | 1,440 | — | * | |||||||||||||||
West Rim Capital Special Investors B, LLC (87) | 7,200 | * | 7,200 | — | * | |||||||||||||||
Wetherington, Michael Joseph (88)(‡) | 3,500 | * | 3,500 | — | * | |||||||||||||||
Willis, Gregory B., II (89) | 19,070 | * | 13,070 | 6,000 | * | |||||||||||||||
Winthrop, Jon R. | 17,500 | * | 17,500 | — | * | |||||||||||||||
WLR IV Parallel ESC, L.P. (90)(‡) | 17,000 | * | 17,000 | — | * | |||||||||||||||
WLR Recovery Fund IV, L.P. (90)(‡) | 4,233,000 | 4.30 | % | 4,233,000 | — | * | ||||||||||||||
Subtotal | 62,724,889 | 63.75 | % | 59,306,528 | 3,418,361 | 3.47 | % | |||||||||||||
Other Selling Stockholders (92) | 2,504,339 | 2.55 | % | 2,504,339 | — | * | ||||||||||||||
Total | 65,229,228 | — | 61,810,867 | 3,418,361 | 3.47 | % |
Beneficial Ownership | Number of | Beneficial Ownership | ||||||||||||||||||
Before Resale | shares offered | After Resale (93) | ||||||||||||||||||
Class B Non-Voting Common Stock | pursuant to | Class B Non-Voting Common Stock | ||||||||||||||||||
Number of | this | Number of | ||||||||||||||||||
shares | % | prospectus | shares | % | ||||||||||||||||
Genefinance S.A. (33) | 1,829,339 | 100.00 | % | 1,829,339 | — | * |
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* | Less than 1.0%. | |
(†) | Broker-dealer. | |
(‡) | Affiliate of broker-dealer. | |
(1) | Antonello Isabella, as the majority shareholder of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(2) | Steven F. Udvar-Házy has sole voting and investment power with respect to the shares held by this selling stockholder, of which he is the sole stockholder and one of three directors. Mr. Udvar-Házy is the Chief Executive Officer and Chairman of the board of directors of the Company. The remaining directors, Christine L. Udvar-Házy and Steven C. Udvar-Házy, disclaim beneficial ownership of the shares held by the selling stockholder, except to the extent of their respective pecuniary interests therein. | |
(3) | Steven F. Udvar-Házy has shared voting and investment power over the shares held by this selling stockholder. Mr. Udvar-Házy is the Chief Executive Officer and Chairman of the board of directors of the Company. The members of the selling stockholder are AL 1 Management, LLC, AL Investment Group LLC, and Biscayne 4400 AL, LLC. AL 1 Management, LLC and AL Investment Group LLC each has the power to designate a co-manager of the selling stockholder, and has designated itself as such. Mr. Udvar-Házy is the sole member and manager of AL 1 Management, LLC. | |
(4) | Peter J. Eichler, Jr. has voting and investment power over the shares held by this selling stockholder. | |
(5) | This selling stockholder is an investment company registered under the Investment Company Act of 1940, as amended. Capital Research and Management Company (“CRMC”), an investment adviser registered under the Investment Advisers Act of 1940, as amended, is the investment adviser to this selling stockholder. CRMC provides investment advisory services to this stockholder through its division Capital World Investors (“CWI”). In that capacity, CWI may be deemed to be the beneficial |
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owner of the shares of Class A Common Stock held by this selling stockholder. CWI, however, disclaims such beneficial ownership. The selling stockholder has advised that Donnalisa Parks Barnum, Gregg E. Ireland, Gregory D. Johnson, Michael T. Kerr and Ronald B. Morrow, as portfolio counselors for the selling stockholder, are primarily responsible for the portfolio management of the selling stockholder. | ||
(6) | Adam Said has voting and investment power over the shares held by this selling stockholder. | |
(7) | The general partner of Ares Corporate Opportunities Fund III, L.P. (“ACOF III”) is ACOF Management III, L.P. (“ACOF Management”) and the general partner of ACOF Management is ACOF Operating Manager III LLC (“ACOF Operating Manager”). The general partner of Ares Special Situations Fund, L.P. (“ASSF”) and Ares Special Situations Fund I-B, L.P. (“ASSF I-B”) is ASSF Management, L.P. (“ASSF Management”) and the general partner of ASSF Management is ASSF Operating Manager, LLC (“ASSF Operating Manager”). Each of ACOF Management, ACOF Operating Manager, ASSF Management, and ASSF Operating Manager are directly or indirectly controlled by Ares Management LLC (“Ares Management”), which in turn is indirectly controlled by Ares Partners Management Company LLC (“Ares Parent,” and together with Ares Management, ACOF III, ACOF Management, ACOF Operating Manager, ASSF, ASSF I-B, ASSF Management and ASSF Operating Manager, the “Ares Entities”). Ares Parent is managed by an executive committee comprised of Antony P. Ressler (a member of the board of directors of the Company), Michael Arougheti, David Kaplan, Greg Margolies, and Bennett Rosenthal. Each of the Ares Entities (other than ACOF III, ASSF and ASSF I-B, with respect to the shares held directly by ACOF III, ASSF and ASSF I-B, respectively) and the members of the executive committee and the partners, members and managers of the Ares Entities expressly disclaims beneficial ownership of these shares of Class A Common Stock. | |
(8) | Consists of 71,178 shares of Class A Common Stock and 48,333 options to purchase Class A Common Stock that are exercisable within 60 days of May 1, 2011. The selling stockholder is Executive Vice President, Marketing, of the Company. | |
(9) | Steve Stancarone, as Assistant Vice President of this selling stockholder, may be deemed to have voting and investment power over the shares held by such stockholder. Mr. Stancarone expressly disclaims beneficial ownership of such securities. Barclays Capital Inc., an affiliate of the selling stockholder, acted as an underwriter in our initial public offering of Class A Common Stock. | |
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(10) | This selling stockholder is an employee of RBC Capital Markets and was an employee of FBR Capital Markets & Co. at the time he purchased his shares. RBC Capital Markets and FBR Capital Markets & Co. participated as underwriters in our initial public offering of Class A Common Stock. In addition, FBR Capital Markets & Co. acted as initial purchaser and placement agent in our private placement of Common Stock in June and July 2010. At the time of the purchase of the shares that may be sold pursuant to this prospectus, the selling stockholder represented that the stockholder was acquiring the shares for the stockholder’s own account (and not for the account of others) for investment purposes and not with a view to, or for offer or sale in connection with, a distribution in violation of the Securities Act. | |
(11) | BlackRock, Inc. is the ultimate parent holding company of BlackRock Financial Management, Inc., which, as sub-advisor to BlackRock Corporate High Yield Fund III, Inc. and BlackRock Corporate High Yield Fund V, Inc. and as investment advisor to BlackRock Funds II — High Yield Bond Portfolio and The Obsidian Master Fund, has voting and investment power over the securities held by such funds. In addition, BlackRock, Inc. is the ultimate parent holding company of BlackRock Investment Management, LLC, which, as investment manager to R3 Capital Partners Master, L.P., has voting and investment power over the securities held by such fund. On behalf of BlackRock Investment Management, LLC and BlackRock Financial Management, Inc., the respective investment manager or sub-advisor to the applicable referenced funds, Joshua Tarnow, as a Managing Director at BlackRock Investment Management, LLC and BlackRock Financial Management, Inc., has voting and investment power over the referenced securities held by such funds. Mr. Tarnow expressly disclaims beneficial ownership of all shares held by the referenced stockholder funds. | |
(12) | Janine Bombardier, J.R. Andre Bombardier, Claire Bombardier Beaudoin and Huguette Bombardier Fontaine together indirectly control, through holding companies, 79.09% of the outstanding Class A shares and 0.08% of the outstanding Class B subordinate shares, and 54.33% of all the voting rights attached to all of the issued and outstanding voting shares of this selling stockholder. In addition, Janine Bombardier and J.R. Andre Bombardier are each a director of this selling stockholder. | |
(13) | This selling stockholder is an employee of FBR Capital Markets & Co., a broker-dealer. FBR Capital Markets & Co. participated as an underwriter in our initial public offering of Class A Common Stock. In addition, FBR Capital Markets & Co. acted as initial purchaser and placement agent in our private placement of Common Stock in June and July 2010. At the time of the purchase of the shares that may be sold pursuant to this prospectus, the selling stockholder represented that the stockholder was acquiring the shares for the stockholder’s own account (and not for the account of others) for investment purposes and not with a view to, or for offer or sale in connection with, a distribution in violation of the Securities Act. The selling stockholder has voting and investment power over his shares. | |
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(14) | Joseph Kerrigan, as president of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(15) | Richard S. Strong, as managing partner of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(16) | Gabriel Brener and Alvaro Pascotto, as managers and owners of the managers and members of this selling stockholder, have voting and investment power over the shares held by such stockholder. | |
(17) | Gaetan Japy, as shareholder and president of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(18) | Charles M. Levy and Lydia Levy share voting and investment power over the shares held by this selling stockholder. | |
(19) | This selling stockholder is an employee of Moelis & Company LLC, a broker-dealer. Moelis & Company LLC acted as our financial advisor in our private placement of Common Stock in June and July 2010. At the time of the purchase of the shares that may be sold pursuant to this prospectus, the selling stockholder represented that the stockholder was acquiring the shares for the stockholder’s own account (and not for the account of others) for investment purposes and not with a view to, or for offer or sale in connection with, a distribution in violation of the Securities Act. | |
(20) | Consists of 1,278 shares of Class A Common Stock held directly by the selling stockholder; 2,250 shares of Class A Common Stock held by RBC Capital Markets, LLC for the benefit of the selling stockholder, of which such stockholder is the sole owner and beneficiary; and 5,000 options to purchase Class A Common Stock held directly by the selling stockholder that are exercisable within 60 days of May 1, 2011. The selling stockholder is Senior Vice President and Chief Financial Officer of the Company. | |
(21) | Craig O. McCau, as sole member of this selling stockholder, has voting and investment power over the shares held by such stockholder. |
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(22) | Commonwealth Bank of Australia is the direct beneficial owner of 6,250,000 shares of Class A Common Stock and one warrant to purchase up to 268,125 shares of Common Stock. The shares and percentages disclosed for Commonwealth Bank of Australia in the tables above assume that the foregoing warrant is exercised for 268,125 shares of Class A Common Stock, although such warrant is exercisable for shares of either Class A Common Stock or Class B Non-Voting Common Stock. Commonwealth Bank of Australia also may be deemed to be the beneficial owner of 700,000 shares of Class A Common Stock purchased for the accounts of certain clients of First State Investment Management (UK) Limited (“FSIM”) and its direct, wholly-owned subsidiary, First State Investments International Limited (“FSII”), both of which are indirect, wholly-owned subsidiaries of Commonwealth Bank of Australia. FSIM and FSII may be deemed to be the beneficial owners of the shares held in the accounts of their respective clients by virtue of their voting and investment control over such shares in their capacity as investment advisers to such clients. ASB Group Investments Limited, an indirect, wholly-owned subsidiary of Commonwealth Bank of Australia, is the trustee of one such account and may also be deemed to be the beneficial owner of 895 of those 700,000 shares of Class A Common Stock. Ian M. Saines, a member of the board of directors of the Company, may be deemed to be the beneficial owner of some or all of the foregoing shares and the warrant in his capacity as Group Executive of the Institutional Banking and Markets Division of Commonwealth Bank of Australia; however, Mr. Saines disclaims beneficial ownership of these shares of Class A Common Stock, the warrant and the shares underlying the warrant, except to the extent of his pecuniary interest therein. Mr. Saines does not have voting and investment power over the shares of Class A Common Stock and the warrant. Ralph Norris, as Chief Executive Officer of Commonwealth Bank of Australia, may be deemed to have voting and investment power over the shares of Class A Common Stock and the warrant held directly by Commonwealth Bank of Australia. Habib Subjally, as head of Global Equities at Colonial First State Global Asset Management, part of the Wealth Management Division of Commonwealth Bank of Australia, has voting and investment power over the shares purchased for the accounts of certain clients of FSIM and FSII. | |
(23) | This selling stockholder acted as joint book-running manager of our initial public offering of Class A Common Stock. David Hermer, a managing director of the selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(24) | Shawn Bergerson, as chief executive officer of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(25) | Steven F. Udvar-Házy shares voting and investment power with respect to the shares of Class A Common Stock held by this selling stockholder. Mr. Udvar-Házy is the Chief Executive Officer and Chairman of the board of directors of the Company. A trust of which he is trustee controls a majority of the membership interests in the selling stockholder; in addition, Mr. Udvar-Házy is one of three managers of the selling stockholder, together with Christine L. Udvar-Házy and Karissa K. Udvar-Házy. Mrs. Udvar-Házy and Ms. |
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Udvar-Házy disclaim beneficial ownership of the shares held by the selling stockholder, except to the extent of their respective pecuniary interests therein. | ||
(26) | J. Steven Emerson has voting and investment power over the shares held by this selling stockholder. | |
(27) | This selling stockholder is an employee of Roth Capital Partners, a broker-dealer. At the time of the purchase of the shares that may be sold pursuant to this prospectus, the selling stockholder represented that the stockholder was acquiring the shares for the stockholder’s own account (and not for the account of others) for investment purposes and not with a view to, or for offer or sale in connection with, a distribution in violation of the Securities Act. The selling stockholder purchased the shares for investment purposes. | |
(28) | This selling stockholder is an investment company registered under Section 8 of the Investment Company Act of 1940 (the “Fund”), and advised by Fidelity Management & Research Company (“Fidelity”), 82 Devonshire Street, Boston, Massachusetts, 02109, a wholly owned subsidiary of FMR LLC and an investment adviser registered under Section 203 of the Investment Advisers Act of 1940. Edward C. Johnson 3d and FMR LLC, through its control of Fidelity and the Fund, each has sole power to dispose of the securities owned by the Fund. Members of the family of Edward C. Johnson 3d, Chairman of FMR LLC, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders’ voting agreement, members of the Johnson family may be deemed, under | |
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the Investment Company Act of 1940, to form a controlling group with respect to FMR LLC. Neither FMR LLC nor Edward C. Johnson 3d, Chairman of FMR LLC, has the sole power to vote or direct the voting of the shares owned directly by the Fund, which power resides with the Fund’s Board of Trustees. Matthew Fruhan, as an employee of Fidelity and the current portfolio manager for each of Fidelity Advisor Series I: Fidelity Advisor Large Cap Fund and Fidelity Commonwealth Trust: Fidelity Large Cap Stock Fund, has investment discretion with respect to each of such fund’s assets. William Danoff, as an employee of Fidelity and the current portfolio manager for each of Fidelity Contrafund: Fidelity Advisor New Insights Fund and Fidelity Contrafund: Fidelity Contrafund, has investment discretion with respect to each of such fund’s assets. Robert Bertelson, as an employee of Fidelity and the current portfolio manager for Fidelity Financial Trust: Fidelity Independence Fund, has investment discretion with respect to such fund’s assets. Geoff Stein and Robert Bertelson, as employees of Fidelity and the current portfolio managers for Variable Insurance Products Fund V: Asset Manager: Growth Portfolio and Variable Insurance Products Fund V: Asset Manager Portfolio, have investment discretion with respect to each of such fund’s assets. | ||
(29) | Fourth Avenue Capital Partners GP LLC is the general partner of this selling stockholder and, as such, Fourth Avenue Capital Partners GP LLC may be deemed to beneficially own the shares held by the selling stockholder. This selling stockholder has advised that Daniel Gold, Nicholas Brumm, Tracy Fu, and Arthur Chu, as managing members of Fourth Avenue Capital Partners GP LLC, have voting and investment power over the shares held by the selling stockholder. | |
(30) | Michael Doheny, as director of this selling stockholder, has voting and investment power over the shares held by the selling stockholder. | |
(31) | Michael Doheny, as managing member of this selling stockholder’s general partner, has voting and investment power over the shares held by such stockholder. | |
(32) | Gregory A. Kemp is manager of GAK Management LLC, this selling stockholder’s general partner, and as such, Mr. Kemp has voting and investment power over the shares held by such stockholder. | |
(33) | Genefinance S.A. holds 3,170,661 shares of Class A Common Stock, 1,829,339 shares of Class B Non-Voting Common Stock and one warrant to purchase 214,500 shares of Common Stock. The shares and percentages disclosed for Genefinance S.A. in the tables above assume that the foregoing warrant is exercised for 214,500 shares of Class A Common Stock, although such warrant is exercisable for shares of either Class A Common Stock |
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or Class B Non-Voting Common Stock. Subject to Genefinance S.A.’s internal approval procedures, Arnaud Jacquemin and Denis Devers, as employees of Société Générale S.A. and directors of Genefinance S.A., exercise voting and investment power over the shares of Common Stock, the warrant and the shares of Common Stock underlying the warrant held by Genefinance S.A. These individuals disclaim beneficial ownership of such securities except to the extent of any pecuniary interest therein. Genefinance S.A. is a wholly owned subsidiary of Société Générale S.A., and Société Générale S.A. may therefore be deemed to have shared investment power and voting power with respect to these shares of Common Stock, the warrant and the shares of Common Stock underlying the warrant. Michel Péretié, a member of the board of directors of the Company, may be deemed to be the beneficial owner of these shares of Common Stock, the warrant, and the shares of Common Stock underlying the warrant in his capacity as a member of the executive committee of Société Générale S.A; however, Mr. Péretié disclaims beneficial ownership of these shares of Common Stock, the warrant, and the shares underlying the warrant, except to the extent of his pecuniary interest therein. The selling stockholder is an affiliate of SG Americas Securities, LLC, which participated as an underwriter in our initial public offering of Class A Common Stock. | ||
(34) | Voting and investment power with respect to the shares of Class A Common Stock offered for sale pursuant to this prospectus by Green Equity Investors V, L.P. and Green Equity Investors Side V, L.P. may be deemed to be shared by their general partner GEI Capital V, LLC, Green V Holdings, LLC (a limited partner of GEI Capital V, LLC), Leonard Green & Partners, L.P. (an affiliate of GEI Capital V, LLC), and LGP Management, Inc. (the general partner of Leonard Green & Partners, L.P.), each of which disclaims beneficial ownership of such shares except to the extent of its pecuniary interest therein. Each of John G. Danhakl, Peter J. Nolan, Jonathan D. Sokoloff, Jonathan A. Seiffer, John M. Baumer, Timothy J. Flynn, James D. Halper, Michael J. Connolly, Todd M. Purdy, and Michael S. Solomon may also be deemed to share voting and investment power with respect to such shares due to their respective positions with LGP Management, Inc., and each of them disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein. John G. Danhakl is also a member of the board of directors of the Company. | |
(35) | This selling stockholder is a member of the board of directors of the Company. | |
(36) | Steven F. Udvar-Házy is the trustee of this selling stockholder and has sole voting and investment power over the shares held by such stockholder. Mr. Udvar-Házy is the Chief Executive Officer and Chairman of the board of directors of the Company. | |
(37) | The sole general partner of this selling stockholder (the “Fund”) is HighVista GP Limited Partnership (the “GP”). The GP has both voting and investment discretion for the assets of the Fund, including its holdings in the Company. The GP has delegated voting and investment discretion for the Fund’s assets to HighVista Strategies LLC. The stockholder has further advised that Dan Jick and Brian Chu, as members of High Vista Strategies LLC, have voting and investment power over the shares held by the selling stockholder. | |
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(38) | This selling stockholder (the “Fund”) has entered into an investment advisory agreement with HighVista Strategies LLC. Under that agreement, HighVista Strategies LLC may exercise voting and investment discretion on behalf of the Fund, including over its holdings in the Company. The stockholder has further advised that Dan Jick and Brian Chu, as members of HighVista Strategies LLC, have voting and investment power over the shares held by the selling stockholder. | |
(39) | This selling stockholder is an employee of FBR Capital Markets International Ltd., which is an affiliate of FBR Capital Markets & Co. FBR Capital Markets & Co. participated as an underwriter in our initial public offering of Class A Common Stock. In addition, FBR Capital Markets & Co. acted as initial purchaser and placement agent in our private placement of Common Stock in June and July 2010. At the time of the purchase of the shares that may be sold pursuant to this prospectus, the selling stockholder represented that the stockholder was acquiring the shares for the stockholder’s own account (and not for the account of others) for investment purposes and not with a view to, or for offer or sale in connection with, a distribution in violation of the Securities Act. The selling stockholder has voting and investment power over his shares. | |
(40) | J. Ralph Atkin and Cheri B. Atkin, as trustees of this selling stockholder, have voting and investment power over the shares held by such stockholder. | |
(41) | KBW Asset Management, Inc., investment manager for this selling stockholder, controls voting and disposition of the shares held by such stockholder. | |
(42) | Consists of 71,178 shares of Class A Common Stock and 48,333 options to purchase Class A Common Stock that are exercisable within 60 days of May 1, 2011. The selling stockholder is an Executive Vice President of the Company. | |
(43) | Esas Holding is the majority shareholder of this selling stockholder. Şevket Sabancı, Zerin Sabancı, Emine Kamışlı, Ali İsmail Sabancı, Can Köseoğlu, and Kazım Köseoğlu are direct and/or, by reason of their interests in Esas Holding, indirect equity holders in the selling stockholder. Emine Kamışlı is also Chairman of the selling stockholder. | |
(44) | Voting and investment power over the shares held by this selling stockholder are shared by such stockholder and J. Gary Kosinski, investment advisor to the selling stockholder. However, Mr. Kosinski disclaims beneficial ownership of such shares. | |
(45) | Luis Valdich, Cristina Kim, and Jing Wang, each of whom is a director of this selling stockholder, have voting and investment power over the shares held by such stockholder. J. P. Morgan Securities LLC, an affiliate of this selling stockholder, acted as joint book-running manager of our initial public offering of Class A Common Stock. |
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(46) | Ron Lindorf, the manager of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(47) | Consists of 80,300 shares of Class A Common Stock held by the selling stockholder; 50,000 options to purchase Class A Common Stock held by the selling stockholder that are exercisable within 60 days of May 1, 2011; and 1,500 shares of Class A Common Stock held directly in the aggregate by the selling stockholder’s children. The selling stockholder disclaims beneficial ownership of the shares held directly by his children, except to the extent of his pecuniary interest therein. The selling stockholder is Executive Vice President, General Counsel and Secretary of the Company. | |
(48) | Charles Levy and Lydia A. Levy, as trustees of this selling stockholder, have voting and investment power over the shares held by the stockholder. | |
(49) | Navid Mahmoodzadegan, as trustee of this selling stockholder, has voting and investment power over the shares held by such stockholder. Mr. Mahmoodzadegan is a partner of Moelis & Company LLC, a broker-dealer. Moelis & Company LLC acted as our financial advisor in our private placement of Common Stock in June and July 2010. | |
(50) | Sandler O’Neill Asset Management, LLC (“SOAM”), by reason of its position as management company for this selling stockholder, may be deemed to beneficially own the shares of Class A Common Stock owned by the selling stockholder. SOAM Holdings, LLC (“Holdings”), by reason of its position as general partner of the selling stockholder, may be deemed to beneficially own the shares of Class A Common Stock owned by such stockholder. Terry Maltese, by reason of his position as managing member of SOAM and Holdings, may be deemed to beneficially own the shares of Class A Common Stock owned by the selling stockholder. However, Mr. Maltese disclaims beneficial ownership of the shares of Class A Common Stock held by the selling stockholder, except for his pecuniary interest therein. Mr. Maltese has voting and investment power over the shares held by the selling stockholder. | |
(51) | Sandler O’Neill Asset Management, LLC (“SOAM”), by reason of its position as investment manager for this selling stockholder, may be deemed to beneficially own the |
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shares of Class A Common Stock owned by the selling stockholder. Terry Maltese, by reason of his position as managing member of SOAM, may be deemed to beneficially own the shares of Class A Common Stock owned by the selling stockholder. However, Mr. Maltese disclaims beneficial ownership of the shares of Class A Common Stock owned by the selling stockholder, except for his pecuniary interest therein. Mr. Maltese has voting and investment power over the shares held by the selling stockholder. | ||
(52) | This selling stockholder is a Managing Director of FBR Capital Markets & Co., a broker-dealer. | |
(53) | Mark J. Miller, as Chief Executive Officer and member of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(54) | Kenneth Moelis is the managing member of Moelis & Company Manager LLC, which indirectly controls this selling stockholder, and as such, Mr. Moelis has voting and investment power over the shares held by such stockholder. The selling stockholder acted as our financial advisor in our private placement of Common Stock in June and July 2010. | |
(55) | Steven F. Udvar-Házy has sole voting and investment power with respect to the shares held by this selling stockholder. Mr. Udvar-Házy is the Chief Executive Officer and Chairman of the board of directors of the Company. A trust of which Mr. Udvar-Házy is the trustee is the sole stockholder of the selling stockholder, and Mr. Udvar-Házy is one of the three directors. The remaining directors, Christine L. Udvar-Házy and Steven C. Udvar-Házy, disclaim beneficial ownership of the shares held by the selling stockholder, except to the extent of their respective pecuniary interests therein. | |
(56) | Linda Garbarino is Chief Financial Officer of Pairstech Capital Management, the investment manager of this selling stockholder, and as such, Ms. Garbarino has voting and investment power over the shares held by such stockholder. |
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(57) | John L. Plueger and Celeste J. Lesperance, as trustees of this selling stockholder, have voting and investment power over the shares held by such stockholder. Mr. Plueger is President and Chief Operating Officer of the Company, as well as a member of the board of directors of the Company. As of May 1, 2011, Mr. Plueger was deemed to beneficially own, in addition to these shares, 236,935 options to purchase Class A Common Stock that are exercisable within 60 days of May 1, 2011, and an aggregate of 1,000 shares of Class A Common Stock owned by his sons. Mr. Plueger disclaims beneficial ownership of the shares owned by his sons, except to the extent of his pecuniary interest therein. | |
(58) | Consists of 25,862 shares of Class A Common Stock and 5,000 options to purchase Class A Common Stock that are exercisable within 60 days of May 1, 2011. The selling stockholder is Senior Vice President of Aircraft Procurement and Specifications of the Company. | |
(59) | PPM America Capital Partners III, LLC (the “General Partner”) is the general partner of this selling stockholder and may be deemed to be a beneficial owner of the shares held by the stockholder. Bruce D. Gorchow, as President and Member of the General Partner, and Scott D. Rooth, as Executive Partner and Member of the General Partner, have voting and investment power over the shares held by the selling stockholder. | |
(60) | This selling stockholder’s account is managed by Putnam Investment Management, LLC, which, through a series of holding companies, is owned by Great-West Lifeco Inc., a publicly traded company. | |
(61) | QVT Financial LP is the investment manager of this selling stockholder and has voting and investment control over the securities held by the selling stockholder. QVT Financial GP LLC is the general partner of QVT Financial LP and as such has complete discretion in the management and control of the business affairs of QVT Financial LP. QVT Associates GP LLC is the general partner of the selling stockholder and has voting and investment control over the securities held by the selling stockholder. Accordingly, each of QVT Financial LP, QVT Financial GP LLC and QVT Associates GP LLC may be deemed to beneficially own the securities held by the selling stockholder. The managing members of QVT Associates GP LLC and QVT Financial GP LLC are Daniel Gold, Nicholas Brumm, Arthur Chu and Tracy Fu; these managing members have voting and investment power over the shares held by the selling stockholder. Each of Daniel Gold, Nicholas Brumm, Arthur Chu and Tracy Fu disclaims beneficial ownership of the shares held by the selling stockholder. | |
(62) | Managing Directors Theodore J. Davies and Reid T. Funston have voting and investment power over the shares held by the selling stockholder. |
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(63) | Nathan Ricks, as manager of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(64) | John E. McCaw Jr., as managing member of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(65) | Stephen E. Samuelian, as trustee of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(66) | Scott J. Seymour and Kathleen T. Goette Seymour, as trustees for this selling stockholder, have voting and investment power over the shares held by such stockholder. | |
(67) | Linda Singer, Juliette Singer, Lauren Goldfarb and Stuart Singer own the interests in this selling stockholder and as such have voting and investment power over the shares held by such stockholder. | |
(68) | Robert S. Feidelson, as manager of this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(69) | Terry Maltese, by reason of his position as managing member of this selling stockholder, may be deemed to beneficially own the shares of Class A Common Stock owned by such stockholder. However, Mr. Maltese disclaims beneficial ownership of such shares except for his pecuniary interest therein. Mr. Maltese has voting and investment power over the shares held by the selling stockholder. | |
(70) | SOAM Ventures, LLC is the management company for this selling stockholder and is an affiliate of Sandler O’Neill Asset Management, LLC (“SOAM”). As such, SOAM may be deemed to beneficially own the shares of Class A Common Stock owned by this selling stockholder. SOAM Venture Holdings, LLC (“Ventures”), by reason of its position as general partner of the selling stockholder, may be deemed to beneficially own the shares of Class A Common Stock owned by such stockholder. Terry Maltese, by |
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reason of his position as managing member of SOAM and Ventures, may be deemed to beneficially own the shares of Class A Common Stock owned by the selling stockholder. However, Mr. Maltese disclaims beneficial ownership of the shares of Class A Common Stock held by the selling stockholder except for his pecuniary interest therein. Mr. Maltese has voting and investment power over the shares held by the selling stockholder. | ||
(71) | Sorenson Partners, LLC is the general partner of this selling stockholder, and West Rim Capital I, LLC is the managing member of Sorenson Partners, LLC. As managers of West Rim Capital I, LLC, Fraser Bullock, Ronald Mika and Tim Layton have voting and investment power over the shares held by the selling stockholder. | |
(72) | West Rim Capital Associates II, L.P. is the general partner of this selling stockholder. As limited partners of West Rim Capital Associates II, LP, Fraser Bullock, Ronald Mika, Tim Layton, Matthew Lehman, Luke Sorenson and Curtis Toone have voting and investment power over the shares held by the selling stockholder. | |
(73) | Ronald D. Sugar and Valerie S. Sugar are trustees of this selling stockholder and as such have voting and investment power over the shares held by such stockholder. Dr. Sugar is a member of the board of directors of the Company. | |
(74) | S. Donald Sussman, as the president of this selling stockholder’s general partner, and Gary Kosinski, as investment adviser to the selling stockholder, share voting and investment power with respect to the shares held by such stockholder and included in this prospectus. Mr. Sussman shares voting and investment power over other shares of the Company held by the selling stockholder with another investment advisor. Messrs. Sussman and Kosinski disclaim beneficial ownership of the shares held by the selling stockholder. | |
(75) | Andrew Sun, as President, Chief Operating Officer, and Director of this selling stockholder, has voting and investment power over the shares held by such stockholder. |
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(76) | Barbara P. Robinson and Christopher B. Sarofim, as trustees of this selling stockholder, have voting and investment power over the shares held by such stockholder. Mr. Sarofim is the sole beneficiary of the stockholder. | |
(77) | Alberto Beeck, as investment advisor to this selling stockholder, has voting and investment power over the shares held by such stockholder. | |
(78) | Kenneth Moelis and Julie Moelis, as trustees of this selling stockholder, have voting and investment power over the shares held by such stockholder. Mr. Moelis is Chief Executive Officer of Moelis & Company LLC, a broker-dealer. Moelis & Company LLC acted as our financial advisor in our private placement of Common Stock in June and July 2010. At the time of the purchase of the shares that may be sold pursuant to this prospectus, the selling stockholder represented that the stockholder was acquiring the shares for the stockholder’s own account (and not for the account of others) for investment purposes and not with a view to, or for offer or sale in connection with, a distribution in violation of the Securities Act. | |
(79) | Jeffrey Raich and Robin Raich, as trustees of this selling stockholder, have voting and investment power over the shares held by such stockholder. Mr. Raich is an employee of Moelis & Company LLC, a broker-dealer. Moelis & Company LLC acted as our financial advisor in our private placement of Common Stock in June and July 2010. At the time of the purchase of the shares that may be sold pursuant to this prospectus, the selling stockholder represented that the stockholder was acquiring the shares for the stockholder’s own account (and not for the account of others) for investment purposes and not with a view to, or for offer or sale in connection with, a distribution in violation of the Securities Act. | |
(80) | Steven F. Udvar-Házy, the Chief Executive Officer and Chairman of the board of directors of the Company, may be deemed to beneficially own the shares of Class A Common Stock held directly by the selling stockholder, his wife. However, Mr. Udvar-Házy disclaims beneficial ownership of the shares held directly by the selling stockholder, except to the extent of his pecuniary interest therein. | |
(81) | Steven F. Udvar-Házy, the Chief Executive Officer and Chairman of the board of directors of the Company, may be deemed to beneficially own the shares of Class A Common Stock held directly by the selling stockholder, his daughter. However, Mr. Udvar-Házy disclaims beneficial ownership of the shares held directly by the selling stockholder, except to the extent of his pecuniary interest therein. | |
(82) | Steven F. Udvar-Házy, the Chief Executive Officer and Chairman of the board of directors of the Company, may be deemed to beneficially own the shares of Class A Common Stock held directly by the selling stockholder, his son. However, Mr. Udvar-Házy disclaims beneficial ownership of the shares held directly by the selling stockholder, except to the extent of his pecuniary interest therein. |
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(83) | Steven F. Udvar-Házy, the Chief Executive Officer and Chairman of the board of directors of the Company, may be deemed to beneficially own an aggregate of 5,148,189 shares of Class A Common Stock, representing approximately 5.20% of the outstanding shares of Class A Common Stock of the Company. These 5,148,189 shares consist of 278,889 shares of Class A Common Stock held directly by Air Intercontinental, Inc.; 101,667 shares of Class A Common Stock held directly by Ocean Equities, Inc.; 35,925 shares of Class A Common Stock held directly by Emerald Financial LLC; 2,700,000 and 1,044,225 shares of Class A Common Stock held directly by two trusts, respectively, of which Mr. Udvar-Házy is the trustee and has sole voting and investment power; 583,783 options to purchase Class A Common Stock that are exercisable within 60 days of May 1, 2011; 300,000 shares of Class A Common Stock held directly by AL Investors I, LLC; and 103,700 shares of Class A Common Stock held directly in the aggregate by Mr. Udvar-Házy’s wife and children. Mr. Udvar-Házy has sole voting and investment power with respect to the shares held by Air Intercontinental, Inc., of which he is the sole stockholder and one of three directors. The remaining directors, Christine L. Udvar-Házy, his wife, and Steven C. Udvar-Házy, his son, disclaim beneficial ownership of the shares held by Air Intercontinental, Inc., except to the extent of their respective pecuniary interests therein. Mr. Udvar-Házy has sole voting and investment power with respect to the shares held by Ocean Equities, Inc. A trust of which Mr. Udvar-Házy is the trustee is the sole stockholder of Ocean Equities, Inc., and Mr. Udvar-Házy is one of the three directors. The remaining directors, Mrs. Udvar-Házy and Mr. S. C. Udvar-Házy, disclaim beneficial ownership of the shares held by Ocean Equities, Inc., except to the extent of their respective pecuniary interests therein. Mr. Udvar-Házy shares voting and investment power with respect to the shares of Class A Common Stock held by Emerald Financial LLC. A trust of which he is trustee controls a majority of the membership interests in Emerald Financial LLC; in addition, Mr. Udvar-Házy is one of three managers of Emerald Financial LLC, together with Mrs. Udvar-Házy and Karissa K. Udvar-Házy. Mrs. Udvar-Házy and Ms. Udvar-Házy disclaim beneficial ownership of the shares held by Emerald Financial LLC, except to the extent of their respective pecuniary interests therein. Mr. Udvar-Házy has shared voting and investment power over the shares held by AL Investors I, LLC. The members of AL Investors I, LLC are AL 1 Management, LLC, AL Investment Group LLC, and Biscayne |
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4400 AL, LLC. AL 1 Management, LLC and AL Investment Group LLC each has the power to designate a co-manager of AL Investors 1, LLC, and has designated itself as such. Mr. Udvar-Házy is the sole member and manager of AL 1 Management, LLC. Mr. Udvar-Házy disclaims beneficial ownership of the shares held directly by his wife and children, except to the extent of his pecuniary interest therein. An aggregate of 4,560,606 shares of Class A Common Stock that may be deemed to be beneficially owned by Mr. Udvar-Házy are being included in this prospectus. As suming that all such shares are sold, Mr. Udvar-Házy may be deemed to beneficially own approximately 1.0% of the outstanding shares of Class A Common Stock of the Company following this offering. | ||
(84) | West Rim Capital I, LLC is the general partner of this selling stockholder. As managers of West Rim Capital I, LLC, Fraser Bullock, Ronald Mika, and Tim Layton have voting and investment power over the shares held by the selling stockholder. | |
(85) | West Rim Capital Advisors, L.P. is the general partner of this selling stockholder. As limited partners of West Rim Capital Advisors, L.P., Fraser Bullock, Ronald Mika, Tim Layton, Matthew Lehman, Luke Sorenson and Curtis Toone have voting and investment power over the shares held by the selling stockholder. | |
(86) | West Rim Capital Associates II, L.P. is the general partner of this selling stockholder. As limited partners of West Rim Capital Associates II, LP, Fraser Bullock, Ronald Mika, Tim Layton, Matthew Lehman, Luke Sorenson and Curtis Toone have voting and investment power over the shares held by the selling stockholder. | |
(87) | West Rim Capital I, LLC is the manager of this selling stockholder. As managers of West Rim Capital I, LLC, Fraser Bullock, Ronald Mika, and Tim Layton have voting and investment power over the shares held by the selling stockholder. | |
(88) | This selling stockholder has represented that he is an employee of BHMS, which is affiliated with broker-dealers registered with FINRA and the SEC. The selling stockholder’s spouse, Kristin Wetherington, is Chief Executive Officer and an indirect minority owner of Capital Institutional Services, a broker-dealer registered with FINRA and the SEC. At the time of the purchase of the shares that may be sold pursuant to this prospectus, the selling stockholder represented that the stockholder was acquiring the shares for the stockholder’s own account (and not for the account of others) for investment purposes and not with a view to, or for offer or sale in connection with, a distribution in violation of the Securities Act. |
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(89) | Consists of 14,070 shares of Class A Common Stock and 5,000 options to purchase Class A Common Stock that are exercisable within 60 days of May 1, 2011. The selling stockholder is Vice President, Finance, and Chief Accounting Officer of the Company. | |
(90) | Wilbur L. Ross, Jr., a member of the board of directors of the Company, is the Chairman and CEO of WL Ross & Company LLC and the managing member of El Vedado LLC, the general partner of WL Ross Group, L.P., which is in turn the managing member of WLR Recovery Associates IV LLC, which is the general partner of WLR Recovery Fund IV, L.P. Invesco Private Capital, Inc. is the managing member of Invesco WLR IV Associates LLC, which is in turn the general partner of WLR IV Parallel ESC, L.P. Invesco WLR IV Associates LLC and WLR Recovery Associates IV LLC have agreed to make investments for WLR IV Parallel ESC, L.P. on a pro rata basis in parallel with WLR Recovery Fund IV, L.P. Invesco WLR IV Associates LLC, Invesco Private Capital, Inc., WLR Recovery Associates IV LLC, WL Ross Group, L.P., El Vedado LLC and Mr. Ross may be deemed to share voting and dispositive power over the shares of Class A Common Stock held by WLR Recovery Fund IV, L.P. and WLR IV Parallel ESC, L.P. Mr. Ross disclaims beneficial ownership over these shares of Class A Common Stock, except to the extent of his pecuniary interest therein. | |
(91) | Felix Augusto Sasso, as trustee of this selling stockholder, has voting and investment power over the shares held by such stockholder. Mr. Sasso is an employee of Moelis & Company LLC, a broker-dealer that acted as financial advisor to the Company in connection with our private placement of Common Stock in June and July 2010. At the time of the purchase of the shares that may be sold pursuant to this prospectus, the selling stockholder represented that the stockholder was acquiring the shares for the stockholder’s own account (and not for the account of others) for investment purposes and not with a view to, or for offer or sale in connection with, a distribution in violation of the Securities Act. | |
(92) | The selling stockholders with respect to these shares, which include 1,829,339 shares of Class A Common Stock to be issued upon conversion of the Class B Non-Voting Common Stock currently held by Genefinance S.A., have not yet been identified. We will file a post-effective amendment to the registration statement of which this prospectus forms a part, or will supplement this prospectus, as may be appropriate, to identify the selling stockholders of these shares prior to the sale of such shares pursuant to this prospectus. | |
(93) | Assumes that each named selling stockholder sells all of the shares of our Common Stock it is offering for sale under this prospectus and neither acquires nor disposes of any other shares, or right to purchase other shares of our Common Stock subsequent to the date as of which we obtained information regarding its holdings. Because the selling stockholders are not obligated to sell all or any portion of the shares of our Common Stock shown as offered by them, we cannot estimate the actual number of shares (or the actual percentage of the class) of our Common Stock that will be held by any selling stockholder upon completion of the offering. |
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Management/board member/beneficial holder | Amount of loan | |||
Ares Corporate Opportunities Fund III, L.P. | $ | 20,000,000 | ||
Ares Special Situations Fund, L.P. | $ | 2,609,811 | ||
Ares Special SituationsFund I-B, L.P. | $ | 2,390,189 | ||
Green Equity Investors V, L.P. | $ | 19,231,125 | ||
Green Equity Investors Side V, L.P. | $ | 5,768,875 | ||
Steven F. Udvar-Házy | $ | 8,976,258 | ||
John L. Plueger | $ | 510,012 | ||
Robert A. Milton | $ | 360,000 | ||
Other Members of Management and the Board of Directors | $ | 153,738 | ||
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• | such time as all of the registrable shares covered by the shelf registration statement have been sold in accordance with such shelf registration statement; | |
• | such time as all registrable shares are eligible for sale without any volume or manner of sale restrictions or compliance by us with any current public information requirements pursuant to Rule 144 (or any successor or analogous rule) under the Securities Act and are listed for trading on a national securities exchange; and | |
• | the first anniversary of the effective date of the registration statement, assuming that the registrable shares can be sold under Rule 144 without limitation as to manner of sale or volume restrictions. |
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• | 1% of the total number of shares of our Class A Common Stock then outstanding, which equals 988,851 shares as of June 30, 2011; and |
• | the average weekly trading volume of our Class A Common Stock on the NYSE during the four calendar weeks preceding the date on which notice of the sale is filed with the SEC. |
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• | a citizen or resident of the United States; |
• | a corporation created or organized in the United States or under the laws of the United States, any state thereof or the District of Columbia; |
• | an estate, the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or |
• | a trust if (a) a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust or (b) such trust has made a valid election to be treated as a U.S. person for U.S. federal income tax purposes. |
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• | the gain is effectively connected with a trade or business carried on by thenon-U.S. holder within the United States (and, if required by an applicable tax treaty, is attributable to a U.S. permanent establishment of suchnon-U.S. holder); or |
• | we are or have been a U.S. real property holding corporation, which we refer to as an “USRPHC,” for U.S. federal income tax purposes at any time within the shorter of the five-year period preceding such disposition or suchnon-U.S. holder’s holding period of our Common Stock and either (a) our Common Stock was not regularly traded on an established securities market at any time during the calendar year in which the disposition occurs, or (b) thenon-U.S. holder owns or owned (actually or constructively) more than five percent of the total fair market value of shares of our Common Stock at any time during the five-year period preceding the date of disposition. We are not, and do not anticipate that we will become, a USRPHC for United States federal income tax purposes. |
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• | directly by the selling stockholders and their successors, which includes their donees, pledgees or transferees or their successors-in-interest; or | ||
• | through underwriters, broker-dealers or agents, who may receive compensation in the form of discounts, commissions or agent’s commissions from the selling stockholders or the purchasers of the Common Stock. These discounts, concessions or commissions may be in excess of those customary in the types of transactions involved. |
• | fixed prices; | ||
• | prevailing market prices at the time of sale; | ||
• | prices related to such prevailing market prices; | ||
• | varying prices determined at the time of sale; or | ||
• | negotiated prices. |
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• | on any national securities exchange or quotation system on which the Class A Common Stock may be listed or quoted at the time of the sale; | ||
• | in the over-the-counter market; | ||
• | in privately negotiated transactions; | ||
• | by pledge to secure debts or other obligations; | ||
• | in put or call transactions; | ||
• | in underwritten offerings; | ||
• | through purchases by a broker or dealer as principal and resale by such broker or dealer for its own account pursuant to this prospectus; | ||
• | in ordinary brokerage transactions and transactions in which the broker solicits purchasers; | ||
• | in exchange distributions and/or secondary distributions; | ||
• | in any other transactions other than on such exchanges or services or in the over-the-counter market; | ||
• | through the writing of options (including the issuance by the selling stockholders of derivative securities), whether the options or such other derivative securities are listed on an options exchange or otherwise; | ||
• | through the settlement of short sales made after the effectiveness of the registration statement of which this prospectus is a part; or | ||
• | through any combination of the foregoing. |
• | engage in short sales of the Class A Common Stock in the course of hedging their positions; | ||
• | sell the Class A Common Stock short and deliver the Class A Common Stock to close out short positions; | ||
• | loan or pledge the Class A Common Stock to broker-dealers or other financial institutions that in turn may sell the Class A Common Stock; | ||
• | enter into option or other transactions with broker-dealers or other financial institutions that require the delivery to the broker-dealer or other financial institution of the Class A Common Stock, which the broker-dealer or other financial institution may resell under the prospectus; or | ||
• | enter into transactions in which a broker-dealer purchases as a principal for resale for its own account or through other types of transactions. |
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Page | ||||
Unaudited Financial Statements as of June 30, 2011, the three months ended June 30, 2011 and 2010, the six months ended June 30, 2011 and the period from Inception to June 30, 2010 | ||||
F-2 | ||||
F-3 | ||||
F-4 | ||||
F-5 | ||||
F-6 | ||||
Audited Consolidated Financial Statements as of December 31, 2010 and for the period from Inception to December 31, 2010 | ||||
F-13 | ||||
F-14 | ||||
F-15 | ||||
F-16 | ||||
F-17 | ||||
F-18 |
F-1
(in thousands, except share data) | June 30, 2011 | December 31, 2010 | ||||||
Assets | ||||||||
Cash and cash equivalents | $ | 445,038 | $ | 328,821 | ||||
Restricted cash | 68,862 | 48,676 | ||||||
Flight equipment subject to operating leases | 2,876,962 | 1,649,071 | ||||||
Less accumulated depreciation | (62,036 | ) | (19,262 | ) | ||||
2,814,926 | 1,629,809 | |||||||
Deposits on flight equipment purchases | 319,102 | 183,367 | ||||||
Deferred debt issue costs — less accumulated amortization of $9,418 and $4,754 as of June 30, 2011 and December 31, 2010, respectively | 47,974 | 46,422 | ||||||
Deferred taxes | 3,261 | 8,875 | ||||||
Other assets | 54,336 | 30,312 | ||||||
Total assets | $ | 3,753,499 | $ | 2,276,282 | ||||
Liabilities and Shareholders’ Equity | ||||||||
Accrued interest and other payables | $ | 28,986 | $ | 22,054 | ||||
Debt financing | 1,383,570 | 911,981 | ||||||
Security deposits and maintenance reserves on flight equipment leases | 199,390 | 109,274 | ||||||
Rentals received in advance | 15,205 | 8,038 | ||||||
Total liabilities | 1,627,151 | 1,051,347 | ||||||
Shareholders’ Equity | ||||||||
Preferred Stock, $0.01 par value; 50,000,000 shares authorized; no shares issued or outstanding | — | — | ||||||
Class A Common Stock, $0.01 par value; authorized 500,000,000 shares; issued and outstanding 98,885,131 and 63,563,810 shares at June 30, 2011 and December 31, 2010, respectively | 984 | 636 | ||||||
Class B Non-Voting Common Stock, $0.01 par value; authorized 10,000,000 shares; issued and outstanding 1,829,339 shares | 18 | 18 | ||||||
Paid-in capital | 2,167,187 | 1,276,321 | ||||||
Accumulated deficit | (41,841 | ) | (52,040 | ) | ||||
Total shareholders’ equity | 2,126,348 | 1,224,935 | ||||||
Total liabilities and shareholders’ equity | $ | 3,753,499 | $ | 2,276,282 | ||||
F-2
For the six | For the period | |||||||||||||||
For the three months ended | months ended | from Inception to | ||||||||||||||
June 30, | June 30, | June 30, | ||||||||||||||
(in thousands, except share data) | 2011 | 2010 | 2011 | 2010 | ||||||||||||
Revenues | ||||||||||||||||
Rental of flight equipment | $ | 74,004 | $ | 1,235 | $ | 128,616 | $ | 1,235 | ||||||||
Interest and other | 340 | 474 | 943 | 474 | ||||||||||||
Total revenues | 74,344 | 1,709 | 129,559 | 1,709 | ||||||||||||
Expenses | ||||||||||||||||
Interest | 10,090 | 1,838 | 19,150 | 1,838 | ||||||||||||
Amortization of deferred debt issue costs | 2,336 | 875 | 4,664 | 875 | ||||||||||||
Extinguishment of debt | 3,349 | — | 3,349 | — | ||||||||||||
Amortization of convertible debt discounts | — | 35,798 | — | 35,798 | ||||||||||||
Interest expense | 15,775 | 38,511 | 27,163 | 38,511 | ||||||||||||
Depreciation of flight equipment | 24,644 | 327 | 42,774 | 327 | ||||||||||||
Selling, general and administrative | 11,284 | 5,759 | 21,149 | 6,236 | ||||||||||||
Stock-based compensation | 11,753 | 2,255 | 22,660 | 2,255 | ||||||||||||
Total expenses | 63,456 | 46,852 | 113,746 | 47,329 | ||||||||||||
Income (loss) before taxes | 10,888 | (45,143 | ) | 15,813 | (45,620 | ) | ||||||||||
Income tax (expense) benefit | (3,865 | ) | 4,002 | (5,614 | ) | 4,002 | ||||||||||
Net income (loss) | $ | 7,023 | $ | (41,141 | ) | $ | 10,199 | $ | (41,618 | ) | ||||||
Net income (loss) attributable to common shareholders per share | ||||||||||||||||
Net income (loss) | ||||||||||||||||
Basic | $ | 0.08 | $ | (2.37 | ) | $ | 0.13 | $ | (4.17 | ) | ||||||
Diluted | $ | 0.08 | $ | (2.37 | ) | $ | 0.13 | $ | (4.17 | ) | ||||||
Weighted-average shares outstanding | ||||||||||||||||
Basic | 91,039,329 | 17,394,121 | 78,287,085 | 9,981,375 | ||||||||||||
Diluted | 91,163,657 | 17,394,121 | 78,408,463 | 9,981,375 | ||||||||||||
F-3
Class A | Class B Non-Voting | |||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Common Stock | ||||||||||||||||||||||||||||||||||
Paid-in | Accumulated | |||||||||||||||||||||||||||||||||||
(in thousands, except share data) | Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Total | |||||||||||||||||||||||||||
Balance at December 31, 2010 | — | $ | — | 63,563,810 | $ | 636 | 1,829,339 | $ | 18 | $ | 1,276,321 | $ | (52,040 | ) | $ | 1,224,935 | ||||||||||||||||||||
Class A Common Stock issuance | — | — | 34,825,470 | 348 | — | — | 868,206 | — | 868,554 | |||||||||||||||||||||||||||
Issuance of restricted stock units, net | — | — | 495,851 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Stock based compensation | — | — | — | — | — | — | 22,660 | — | 22,660 | |||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | 10,199 | 10,199 | |||||||||||||||||||||||||||
Balance at June 30, 2011 | — | $ | — | 98,885,131 | $ | 984 | 1,829,339 | $ | 18 | $ | 2,167,187 | $ | (41,841 | ) | $ | 2,126,348 | ||||||||||||||||||||
F-4
For the six | For the period | |||||||
months ended | from Inception to | |||||||
(dollars in thousands) | June 30, 2011 | June 30, 2010 | ||||||
Operating Activities | ||||||||
Net income (loss) | $ | 10,199 | $ | (41,618 | ) | |||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||
Depreciation of flight equipment | 42,774 | 327 | ||||||
Stock-based compensation | 22,660 | 2,255 | ||||||
Deferred taxes | 5,614 | (4,002 | ) | |||||
Amortization of deferred debt issue costs | 4,664 | 875 | ||||||
Extinguishment of debt | 3,349 | — | ||||||
Amortization of convertible debt discounts | — | 35,798 | ||||||
Changes in operating assets and liabilities: | ||||||||
Lease receivables and other assets | (16,327 | ) | (1,199 | ) | ||||
Accrued interest and other payables | 6,932 | 7,424 | ||||||
Rentals received in advance | 7,167 | 2,159 | ||||||
Net cash provided by operating activities | 87,032 | 2,019 | ||||||
Investing Activities | ||||||||
Acquisition of flight equipment under operating lease | (1,177,551 | ) | (319,585 | ) | ||||
Payments for deposits on flight equipment purchases | (169,143 | ) | (15,850 | ) | ||||
Acquisition of furnishings, equipment and other assets | (24,629 | ) | (166 | ) | ||||
Net cash used in investing activities | (1,371,323 | ) | (335,601 | ) | ||||
Financing Activities | ||||||||
Issuance of common stock and warrants | 868,554 | 1,059,707 | ||||||
Issuance of convertible notes | — | 60,000 | ||||||
Proceeds from debt financings | 945,750 | 29,300 | ||||||
Payments in reduction of debt financings | (474,161 | ) | (4,300 | ) | ||||
Restricted cash | (20,186 | ) | (16,394 | ) | ||||
Debt issue costs | (9,565 | ) | (47,006 | ) | ||||
Changes in security deposits and maintenance reserves on flight equipment leases | 90,116 | 9,136 | ||||||
Net cash provided by financing activities | 1,400,508 | 1,090,443 | ||||||
Net increase in cash | 116,217 | 756,861 | ||||||
Cash at beginning of period | 328,821 | — | ||||||
Cash at end of period | $ | 445,038 | $ | 756,861 | ||||
Supplemental Disclosure of Cash Flow Information | ||||||||
Cash paid during the period for interest, including capitalized interest of $4,214 at June 30, 2011 and capitalized interest of $66 at June 30, 2010 | $ | 22,801 | $ | 294 | ||||
Supplemental Disclosure of Noncash Activities | ||||||||
Deposits on flight equipment purchases applied to acquisition of flight equipment under operating leases | $ | 33,408 | $ | 250 | ||||
F-5
F-6
Notes to Consolidated Financial Statements
June 30, 2011
(Unaudited)
(dollars in thousands) | June 30, 2011 | December 31, 2010 | ||||||
Warehouse facility | $ | 709,252 | $ | 554,915 | ||||
Secured term financing | 503,419 | 223,981 | ||||||
Unsecured financing | 170,899 | 133,085 | ||||||
Total | $ | 1,383,570 | $ | 911,981 | ||||
(dollars in thousands) | June 30, 2011 | December 31, 2010 | ||||||
Non-recourse | $ | 740,242 | $ | 573,222 | ||||
With recourse | 472,429 | 205,674 | ||||||
Total | $ | 1,212,671 | $ | 778,896 | ||||
Number of aircraft pledged as collateral | 40 | 29 | ||||||
Net book value of aircraft pledged as collateral | $ | 1,939,832 | $ | 1,266,762 | ||||
a. | Warehouse Facility | ||
On April 1, 2011, the Company executed an amendment to the Company’s non-recourse, revolving credit facility (the “Warehouse Facility”) that took effect on April 21, 2011. This facility, as amended, provides us with financing of up to $1.25 billion, modified from the original facility size of $1.5 billion. We are able to draw on this facility, as amended, during an availability period that ends in June 2013. Prior to the amendment of the Warehouse Facility, the Warehouse Facility accrued interest during the availability period based on LIBOR plus 3.25% on drawn balances and at a rate of 1.00% on undrawn balances. Following the amendment, the Warehouse Facility accrues interest during the availability period based on LIBOR plus 2.50% on drawn balances and 0.75% on undrawn balances. Pursuant to the amendment, the advance level under the facility was increased from 65.0% of the appraised value of the pledged aircraft and 50.0% of the pledged cash to 70.0% of the appraised value of the pledged aircraft and 50.0% of the pledged cash. The outstanding drawn balance at the end of the availability period may be converted at our option to an amortizing, four-year term loan with an interest rate of LIBOR plus 3.25% for the initial three years of the term and margin step-ups during the remaining year that increase the interest to LIBOR plus 4.75%. As a result of amending the Warehouse Facility, we recorded an extinguishment of debt charge of $3.3 million from the write-off of deferred debt issue costs when the amendment became effective on April 21, 2011. | |||
During the second quarter of 2011, the Company drew $104.9 million under the Warehouse Facility and incrementally pledged $163.1 million in aircraft collateral. As of June 30, 2011, the Company had borrowed $709.3 million under the Warehouse Facility and pledged 28 aircraft as collateral with a net book value of $1.2 billion. As of December 31, 2010, the Company had borrowed $554.9 million under the Warehouse Facility and pledged 23 aircraft as collateral with a net book value of $930.0 million. The Company had pledged cash collateral and lessee deposits of $67.5 million and $48.3 million at June 30, 2011 and December 31, 2010, respectively. | |||
F-7
Notes to Consolidated Financial Statements
June 30, 2011
(Unaudited)
b. | Secured Term Financing | ||
During the second quarter of 2011, two of our wholly-owned subsidiaries entered into two separate secured term facilities, with recourse to the Company, aggregating $82.8 million. The two facilities consisted of a three-year $20.3 million facility at a floating rate of LIBOR plus 2.75% and a $62.5 million facility with an eight-year $56.0 million tranche at a rate of LIBOR plus 2.99% and a two-year $6.5 million tranche at a rate of LIBOR plus 2.10%. In connection with these facilities, the Company pledged $129.0 million in aircraft collateral. | |||
The outstanding balance on our secured term facilities was $503.4 million and $224.0 million at June 30, 2011 and December 31, 2010, respectively. | |||
c. | Unsecured Financing | ||
During the second quarter of 2011, the Company issued $120.0 million in senior unsecured notes in a private placement to institutional investors. The notes have a five-year term and a coupon of 5.0%. In addition, we entered into two five-year and one three-year unsecured term facilities totaling $17.0 million with interest rates ranging from 3.0% to 4.0%. | |||
We ended the second quarter of 2011 with a total of nine unsecured term facilities. The total amount outstanding under our unsecured term facilities was $170.9 million and $13.1 million as of June 30, 2011 and December 31, 2010, respectively. | |||
In addition, we increased the capacity of one of our existing three-year revolving unsecured credit facilities from $25.0 million to $30.0 million. The Company ended the second quarter of 2011 with a total of 12 bilateral revolving unsecured credit facilities aggregating $313.0 million, each with a borrowing rate of LIBOR plus 2.00%. We did not have any amounts outstanding under our bilateral revolving unsecured credit facilities as of June 30, 2011 compared to $120.0 million outstanding as of December 31, 2010. | |||
d. | Maturities | ||
Maturities of debt outstanding as of June 30, 2011 are as follows: | |||
(dollars in thousands) | ||||
Years ending December 31, | ||||
2011 | $ | 35,063 | ||
2012 | 71,637 | |||
2013 | 204,764 | |||
2014 | 220,973 | |||
2015 | 228,611 | |||
Thereafter | 622,522 | |||
Total | $ | 1,383,570 | (1) | |
(1) | As of June 30, 2011, the Company had $709.3 million of debt outstanding under the Warehouse Facility which will come due beginning in June 2013. The outstanding drawn balance at the end of the availability period may be converted at the Company’s option to an amortizing, four-year term loan with an increasing interest rate and has been presented as if such option were exercised in the maturity schedule, above. |
F-8
a. | Aircraft Acquisition | ||
As of June 30, 2011, we had commitments to acquire a total of 234 new and nine used aircraft for delivery as follows: | |||
Aircraft Type | 2011(1) | 2012 | 2013 | 2014 | 2015 | Thereafter | Total | |||||||||||||||||||||
Airbus A319-100 | 1 | — | — | — | — | — | 1 | |||||||||||||||||||||
Airbus A320/321-200 | 5 | 10 | 13 | 12 | 7 | — | 47 | |||||||||||||||||||||
Airbus A320/321 NEO(2)(3) | — | — | — | — | — | 50 | 50 | |||||||||||||||||||||
Airbus A330-200/300 | 6 | 6 | — | — | — | — | 12 | |||||||||||||||||||||
Boeing 737-700 | 2 | — | — | — | — | — | 2 | |||||||||||||||||||||
Boeing 737-800(2) | 2 | 3 | 12 | 12 | 14 | 37 | 80 | |||||||||||||||||||||
Boeing 767-300ER | 2 | — | — | — | — | — | 2 | |||||||||||||||||||||
Boeing 777-300ER(3) | — | — | — | 2 | 3 | — | 5 | |||||||||||||||||||||
Boeing 787-9(3) | — | — | — | — | — | 4 | 4 | |||||||||||||||||||||
Embraer E175/190 | 11 | 19 | — | — | — | — | 30 | |||||||||||||||||||||
ATR 72-600 | 2 | 8 | — | — | — | — | 10 | |||||||||||||||||||||
Total | 31 | 46 | 25 | 26 | 24 | 91 | 243 | |||||||||||||||||||||
(1) | Of the 31 aircraft that we will acquire in the remainder of 2011, the following nine aircraft will be used aircraft: the A319-100, one A320-200, one A330-200, both 737-700s, both 737-800s and both 767-300ERs. | |
(2) | We have cancellation rights with respect to 14 of the Airbus A320/321 NEO aircraft and four of the Boeing 737-800 aircraft. | |
(3) | As of June 30, 2011, the Airbus A320/321 NEO aircraft, the Boeing 777-300ER aircraft and the Boeing 787-9 aircraft were subject to non-binding memoranda of understanding for the purchase of these aircraft. | |
Commitments for the acquisition of these aircraft at an estimated aggregate purchase price (including adjustments for inflation) of approximately $11.9 billion at June 30, 2011 are as follows: |
(dollars in thousands) | ||||
Years ending December 31, | ||||
2011 | $ | 1,289,930 | ||
2012 | 1,817,592 | |||
2013 | 1,210,000 | |||
2014 | 1,408,662 | |||
2015 | 1,381,692 | |||
Thereafter | 4,756,915 | |||
Total | $ | 11,864,791 | ||
We have made non-refundable deposits on the aircraft for which we have commitments to purchase of $319.1 million and $183.4 million as of June 30, 2011 and December 31, 2010, respectively. If we are unable to satisfy our purchase commitments we may be forced to forfeit our deposits. Further, we would be exposed to breach of contract claims by our lessees and manufacturers. | |||
F-9
Notes to Consolidated Financial Statements
June 30, 2011
(Unaudited)
b. | Office Lease | ||
The Company’s lease for office space provides for step rentals over the term of the lease. Those rentals are considered in the evaluation of recording rent expense on a straight-line basis over the term of the lease. Tenant improvement allowances received from the lessor are deferred and amortized in selling, general and administrative expenses against rent expense. Commitments for minimum rentals under the non-cancelable lease term at June 30, 2011 are as follows: | |||
(dollars in thousands) | ||||
Years ending December 31, | ||||
2011 | $ | — | ||
2012 | 1,441 | |||
2013 | 2,325 | |||
2014 | 2,395 | |||
2015 | 2,467 | |||
Thereafter | 23,241 | |||
Total | $ | 31,869 | ||
5. | Net Earnings Per Share | |
Basic net earnings per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted into common stock; however, potential common equivalent shares are excluded if the effect of including these shares would be anti-dilutive. The Company’s two classes of common stock, Class A and Class B Non-Voting, have equal rights to dividends and income, and therefore, basic and diluted earnings per share are the same for each class of common stock. | ||
Diluted net earnings per share takes into account the potential conversion of stock options, restricted stock units and warrants using the treasury stock method. For the three months ended June 30, 2011 and 2010, the Company excluded 3,375,908 and 2,450,000 shares related to stock options which are potentially dilutive securities from the computation of diluted earnings per share because including these shares would be anti-dilutive. For the six months ended June 30, 2011 and the period from inception to June 30, 2010, the Company excluded 3,375,908 and 2,450,000 shares related to stock options which are potentially dilutive securities from the computation of diluted earnings per share because including these shares would be anti-dilutive. In addition, the Company excluded 2,613,989 and 2,450,000 shares related to restricted stock units for which the performance metric had yet to be achieved as of June 30, 2011 and 2010, respectively. | ||
The following table sets forth the reconciliation of basic and diluted net income (loss) per share: | ||
For the three months ended June 30, | For the six months ended June 30, | For the period from Inception to June 30, | ||||||||||||||
(in thousands, except share data) | 2011 | 2010 | 2011 | 2010 | ||||||||||||
Numerator: | ||||||||||||||||
Net income (loss) available to common shareholders—basic and diluted EPS | $ | 7,023 | $ | (41,141 | ) | $ | 10,199 | $ | (41,618 | ) | ||||||
Denominator: | ||||||||||||||||
Basic earnings per share—weighted average common shares | 91,039,329 | 17,394,121 | 78,287,085 | 9,981,375 | ||||||||||||
Effect of dilutive securities | 124,328 | — | 121,378 | — | ||||||||||||
Diluted earnings per share—weighted average common shares | 91,163,657 | 17,394,121 | 78,408,463 | 9,981,375 | ||||||||||||
Net income (loss) per share: | ||||||||||||||||
Basic | $ | 0.08 | $ | (2.37 | ) | $ | 0.13 | $ | (4.17 | ) | ||||||
Diluted | $ | 0.08 | $ | (2.37 | ) | $ | 0.13 | $ | (4.17 | ) | ||||||
F-10
Notes to Consolidated Financial Statements
June 30, 2011
(Unaudited)
6. | Fair Value Measurements | |
a. | Assets and Liabilities Measured at Fair Value on a Recurring and Non-recurring Basis | ||
The Company had no assets or liabilities which are measured at fair value on a recurring or non-recurring basis as of June 30, 2011 or December 31, 2010. | |||
b. | Fair Value of Financial Instruments | ||
The carrying value reported on the balance sheet for cash and cash equivalents, restricted cash and other payables approximates their fair value. | |||
The fair value of debt financing is estimated based on the quoted market prices for the same or similar issues, or on the current rates offered to the Company for debt of the same remaining maturities. The estimated fair value of debt financing as of June 30, 2011 was $1,396.7 million compared to a book value of $1,383.6 million. The estimated fair value of debt financing as of December 31, 2010 was $931.2 million compared to a book value of $912.0 million. | |||
7. | Equity Based Compensation | |
In accordance with the Amended and Restated Air Lease Corporation 2010 Equity Incentive Plan (the “Plan”), the maximum number of shares of Common Stock that may be issued under the Plan, including in settlement of Stock Options (“Stock Options”) and Restricted Stock Units (“RSUs”), is approximately 8,193,088 shares as of June 30, 2011. From inception of the Plan through June 30, 2011, the Company had granted 3,375,908 Stock Options and 3,457,964 RSUs. | ||
The Company recorded $11.8 million and $2.3 million of stock-based compensation expense for the three months ended June 30, 2011 and 2010, respectively. Stock-based compensation expense for the six months ended June 30, 2011 and the period from inception to June 30, 2010, totaled $22.7 million and $2.3 million, respectively. | ||
a. | Stock Options | ||
The Company uses the Black-Scholes option pricing model to determine the fair value of stock options. The fair value of stock-based payment awards on the date of grant is determined by an option-pricing model using a number of complex and subjective variables. These variables include expected stock price volatility over the term of the awards, actual and projected employee stock option exercise behaviors, a risk-free interest rate and expected dividends. | |||
Estimated volatility of the Company’s common stock for new grants is determined by using historical volatility of the Company’s peer group. Due to our limited operating history, there is no historical exercise data to provide a reasonable basis which the Company can use to estimate expected terms. Accordingly, the Company uses the “simplified method” as permitted under Staff Accounting Bulletin No. 110. The risk-free interest rate used in the option valuation model is derived from U.S. Treasury zero-coupon issues with remaining terms similar to the expected term on the options. The Company does not anticipate paying any cash dividends in the foreseeable future and therefore uses an assumed dividend yield of zero in the option valuation model. In accordance with ASC Topic 718, Compensation —Stock Compensation, the Company estimates forfeitures at the time of grant and revises those estimates in subsequent periods if actual forfeitures differ from those estimates. The average assumptions used to value stock-based payments are as follows: | |||
For the six | For the period | |||||||||||||||
For the three months ended | months ended | from Inception to | ||||||||||||||
June 30, | June 30, | June 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Dividend yield | None | None | None | None | ||||||||||||
Expected term | 5.9 years | 6.0 years | 5.9 years | 6.0 years | ||||||||||||
Risk-free interest rate | 2.4 | % | 2.5 | % | 2.4 | % | 2.5 | % | ||||||||
Volatility | 50.2 | % | 55.1 | % | 50.2 | % | 55.1 | % | ||||||||
Forfeiture rate | 0.0 | % | 0.0 | % | 0.0 | % | 0.0 | % | ||||||||
F-11
Notes to Consolidated Financial Statements
June 30, 2011
(Unaudited)
A summary of Stock Option activity in accordance with the Plan as of June 30, 2011 and 2010, and changes for the six-month period and the period from inception then ended follows: | |||
Remaining | Aggregate | |||||||||||||||
Exercise | concractual term | intrinsic value | ||||||||||||||
Shares | price | (in years) | (in thousands) | |||||||||||||
Options outstanding at inception | — | |||||||||||||||
Granted | 2,450,000 | $ | 20.00 | 9.9 | ||||||||||||
Exercised | — | |||||||||||||||
Cancelled | — | |||||||||||||||
Options outstanding at June 30, 2010 | 2,450,000 | $ | 20.00 | 9.9 | ||||||||||||
Options exercisable at June 30, 2010 | — | |||||||||||||||
Options outstanding at January 1, 2011 | 3,225,908 | $ | 20.00 | 9.5 | $ | 1,612 | ||||||||||
Granted | 150,000 | 28.80 | 9.8 | |||||||||||||
Exercised | — | |||||||||||||||
Cancelled | — | |||||||||||||||
Options outstanding at June 30, 2011 | 3,375,908 | $ | 20.39 | 9.0 | $ | 13,839 | ||||||||||
Options exercisable at June 30, 2011 | 1,125,292 | $ | 20.00 | 9.0 | $ | 4,828 | ||||||||||
The Company recorded $3.0 million and $0.6 million of stock-based compensation expense related to employee Stock Options for the three months ended June 30, 2011 and 2010, respectively. Stock-based compensation expense related to employee Stock Options for the six months ended June 30, 2011 and the period from inception to June 30, 2010, totaled $5.8 million and $0.6 million, respectively. | |||
b. | Restricted Stock Unit Plan | ||
The following is a summary of activity relating to RSUs: | |||
For the six | For the period | |||||||||||||||
For the three months ended | months ended | from Inception to | ||||||||||||||
June 30, | June 30, | June 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Beginning restricted stock units | 3,225,907 | — | 3,225,907 | — | ||||||||||||
Shares awarded | 232,057 | 2,450,000 | 232,057 | 2,450,000 | ||||||||||||
Shares vested | (843,975 | ) | — | (843,975 | ) | — | ||||||||||
Shares forfeited | — | — | — | — | ||||||||||||
Ending restricted stock units | 2,613,989 | 2,450,000 | 2,613,989 | 2,450,000 | ||||||||||||
At June 30, 2011, the outstanding RSUs are expected to vest as follows: 2012—895,477; 2013—874,530; 2014—843,982. The Company recorded $8.7 million and $1.7 million of stock-based compensation expense related to RSUs for the three months ended June 30, 2011 and 2010, respectively. Stock-based compensation expense related to RSUs for the six months ended June 30, 2011 and the period from inception to June 30, 2010, totaled $16.9 million and $1.7 million, respectively. | |||
As of June 30, 2011, there was $59.4 million of unrecognized compensation cost, adjusted for estimated forfeitures, related to unvested stock-based payments granted to employees. Total unrecognized compensation cost will be adjusted for future changes in estimated forfeitures and is expected to be recognized over a weighted average remaining period of 2.6 years. | ||
8. | Subsequent Events | |
During July 2011, one of our wholly-owned subsidiaries entered into a twelve-year $70.9 million secured term facility, with recourse to the Company, at a floating rate of LIBOR plus 1.50%. In addition, the Company entered into two separate fixed-rate amortizing unsecured facilities including a five-year $5.0 million facility with an interest rate of 3.85% and a three-year $35.0 million facility with an interest rate of 3.25%. | ||
F-12
F-13
(In thousands, except share data) | December 31, 2010 | |||
Assets | ||||
Cash and cash equivalents | $ | 328,821 | ||
Restricted cash | 48,676 | |||
Flight equipment subject to operating leases | 1,649,071 | |||
Less accumulated depreciation | (19,262 | ) | ||
1,629,809 | ||||
Deposits on flight equipment purchases | 183,367 | |||
Deferred debt issue costs — less accumulated amortization of $4,754 | 46,422 | |||
Deferred taxes | 8,875 | |||
Other assets | 30,312 | |||
Total assets | $ | 2,276,282 | ||
Liabilities and Shareholders’ Equity | ||||
Accrued interest and other payables | $ | 22,054 | ||
Debt financing | 911,981 | |||
Security deposits and maintenance reserves on flight equipment leases | 109,274 | |||
Rentals received in advance | 8,038 | |||
Total liabilities | 1,051,347 | |||
Shareholders’ Equity | ||||
Preferred Stock, $0.01 par value; 50,000,000 shares authorized no shares issued or outstanding | — | |||
Class A Common Stock, $0.01 par value; 500,000,000 shares authorized 63,563,810 shares issued and outstanding | 636 | |||
Class B Non-Voting Common Stock, $0.01 par value; 10,000,000 shares authorized 1,829,339 shares issued and outstanding | 18 | |||
Paid-in capital | 1,276,321 | |||
Accumulated deficit | (52,040 | ) | ||
Total shareholders’ equity | 1,224,935 | |||
Total liabilities and shareholders’ equity | $ | 2,276,282 | ||
F-14
For the period | ||||
from Inception to | ||||
(In thousands, except share data) | December 31, 2010 | |||
Revenues | ||||
Rental of flight equipment | $ | 57,075 | ||
Interest and other | 1,291 | |||
Total revenues | 58,366 | |||
Expenses | ||||
Interest | 11,062 | |||
Amortization of deferred debt issuance cost | 4,883 | |||
Amortization of convertible debt discounts | 35,798 | |||
Interest expense | 51,743 | |||
Depreciation of flight equipment | 19,262 | |||
Selling, general and administrative | 24,232 | |||
Stock-based compensation | 24,044 | |||
Total expenses | 119,281 | |||
Loss before taxes | (60,915 | ) | ||
Income tax benefit | 8,875 | |||
Net loss | $ | (52,040 | ) | |
Net loss attributable to common shareholders per share | ||||
Net loss | ||||
Basic | $ | (1.32 | ) | |
Diluted | $ | (1.32 | ) | |
Weighted-average shares outstanding | ||||
Basic | 39,511,045 | |||
Diluted | 39,511,045 | |||
F-15
Consolidated Statement of Shareholders’ Equity
For the period from Inception to December 31, 2010
Class B Non-Voting | ||||||||||||||||||||||||||||||||||||
Preferred Stock | Class A Common Stock | Common Stock | Paid-in | Accumulated | ||||||||||||||||||||||||||||||||
(In thousands, except share data) | Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Total | |||||||||||||||||||||||||||
Balance at inception | — | $ | — | — | $ | — | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||
Class A Common Stock issuance | — | — | 55,750,972 | 558 | — | — | 1,026,082 | — | 1,026,640 | |||||||||||||||||||||||||||
Class B Non-Voting Common Stock issuance | — | — | — | — | 6,308,844 | 63 | 124,852 | — | 124,915 | |||||||||||||||||||||||||||
Class B conversion to Class A | — | — | 4,479,505 | 45 | (4,479,505 | ) | (45 | ) | — | — | — | |||||||||||||||||||||||||
Issuance of warrants | — | — | — | — | — | — | 5,578 | — | 5,578 | |||||||||||||||||||||||||||
Conversion of convertible notes | — | — | 3,333,333 | 33 | — | — | 59,967 | — | 60,000 | |||||||||||||||||||||||||||
Convertible debt discounts | — | — | — | — | — | — | 35,798 | — | 35,798 | |||||||||||||||||||||||||||
Stock based compensation | — | — | — | — | — | — | 24,044 | — | 24,044 | |||||||||||||||||||||||||||
Net (Loss) | — | — | — | — | — | — | — | (52,040 | ) | (52,040 | ) | |||||||||||||||||||||||||
Balance at December 31, 2010 | — | $ | — | 63,563,810 | $ | 636 | 1,829,339 | $ | 18 | $ | 1,276,321 | $ | (52,040 | ) | $ | 1,224,935 | ||||||||||||||||||||
F-16
For the period | ||||
from Inception to | ||||
(dollars in thousands) | December 31, 2010 | |||
Operating Activities | ||||
Net loss | $ | (52,040 | ) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Depreciation of flight equipment | 19,262 | |||
Stock-based compensation | 24,044 | |||
Deferred taxes | (8,875 | ) | ||
Amortization of deferred debt issue costs | 4,883 | |||
Amortization of convertible debt discounts | 35,798 | |||
Changes in operating assets and liabilities: | ||||
Lease receivables and other assets | (8,040 | ) | ||
Accrued interest and other payables | 22,054 | |||
Rentals received in advance | 8,038 | |||
Net cash provided by operating activities | 45,124 | |||
Investing Activities | ||||
Acquisition of flight equipment under operating lease | (1,649,071 | ) | ||
Payments for deposits on flight equipment purchases | (183,367 | ) | ||
Acquisition of furnishings, equipment and other assets | (22,272 | ) | ||
Net cash used in investing activities | (1,854,710 | ) | ||
Financing Activities | ||||
Issuance of common stock and warrants | 1,157,133 | |||
Issuance of convertible notes | 60,000 | |||
Proceeds from debt financings | 916,921 | |||
Payments in reduction of debt financings | (4,940 | ) | ||
Restricted cash | (48,676 | ) | ||
Debt issue costs | (51,305 | ) | ||
Changes in security deposits and maintenance reserves on flight equipment leases | 109,274 | |||
Net cash provided by financing activities | 2,138,407 | |||
Net increase in cash | 328,821 | |||
Cash at inception | — | |||
Cash at end of period | $ | 328,821 | ||
Supplemental Disclosure of Cash Flow Information | ||||
Cash paid during the period for interest, excluding capitalized interest of $1,769 | $ | 12,723 | ||
Supplemental Disclosure of Noncash Activities | ||||
Conversion of convertible notes to Class A Common Stock | $ | 60,000 | ||
F-17
1. | Summary of Significant Accounting Policies |
a. | Organization |
b. | Principles of Consolidation |
c. | Rental of Flight Equipment |
F-18
d. | Initial Direct Costs |
e. | Cash and Cash Equivalents |
f. | Restricted Cash |
g. | Flight Equipment |
F-19
h. | Capitalized Interest |
i. | Fair Value Measurements |
j. | Income Taxes |
F-20
k. | Deferred Costs |
l. | Stock-based Compensation |
m. | Use of Estimates |
2. | Debt Financing |
(dollars in thousands) | December 31, 2010 | |||
Warehouse credit facility | $ | 554,915 | ||
Secured term debt financing | 223,981 | |||
Unsecured financing | 133,085 | |||
Total | $ | 911,981 | ||
a. | Warehouse Facility |
F-21
b. | Secured Financing |
c. | Seller Financing |
d. | Unsecured Credit Facilities |
e. | Shareholder Promissory Note |
F-22
f. | Shareholder Revolving Loan |
g. | Underwriter Promissory Note |
h. | Shareholder Promissory Note |
i. | Convertible Notes |
F-23
j. | Maturities |
(dollars in thousands) | ||||
Years ending December 31, | ||||
2011 | $ | 29,605 | ||
2012 | 128,494 | |||
2013 | 192,007 | |||
2014 | 129,457 | |||
2015 | 145,435 | |||
Thereafter | 286,983 | |||
Total | $ | 911,981 | (1) | |
(1) | As of December 31, 2010 the Company had $554.9 million of debt outstanding under the Warehouse Facility which will come due beginning in May 2012. The outstanding drawn balance at the end of the initial two-year period of the Warehouse Facility may be converted at the Company’s option to an amortizing, four-year term loan with an increasing interest rate. |
3. | Shareholders’ Equity |
F-24
4. | Rental Income |
(dollars in thousands) | ||||
Years ending December 31, | ||||
2011 | $ | 197,870 | ||
2012 | 176,545 | |||
2013 | 153,650 | |||
2014 | 138,601 | |||
2015 | 118,142 | |||
Thereafter | 289,000 | |||
Total | $ | 1,073,808 | ||
F-25
Aircraft Type | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | Total | |||||||||||||||||||||||||||||||||||||||||||
Airbus A319-100 | 1 | 3 | 1 | 1 | 1 | 7 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Airbus A320-200 | 2 | 2 | 1 | 1 | 1 | 1 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||
Airbus A321-200 | 1 | 1 | 2 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Airbus A330-200 | 1 | 1 | 2 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Boeing B737-700 | 1 | 1 | 1 | 1 | 1 | 5 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Boeing B737-800 | 1 | 1 | 3 | 1 | 4 | 1 | 3 | 14 | ||||||||||||||||||||||||||||||||||||||||||||||||
Boeing B777-300ER | 1 | 1 | 2 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | 3 | 4 | 8 | 1 | 6 | 6 | 6 | 1 | 1 | — | 3 | 1 | 40 | |||||||||||||||||||||||||||||||||||||||||||
5. | Concentration of Risk |
a. | Geographical and Credit Risks |
December 31, 2010 | ||||
Air Berlin | 26.5% | |||
Air France | 15.1% | |||
F-26
December 31, 2010 | ||||||
Europe | 42.3 | % | ||||
Asia/Pacific | 26.1 | |||||
Central America, South America and Mexico | 10.0 | |||||
U.S. and Canada | 15.6 | |||||
Middle East | 6.0 | |||||
Total | 100.0 | % | ||||
b. | Currency Risk |
6. | Income Taxes |
For the Period | ||||
from Inception to | ||||
(dollars in thousands) | December 31, 2010 | |||
Current: | ||||
Federal | $ | — | ||
State | — | |||
— | ||||
Deferred: | ||||
Federal | (8,547 | ) | ||
State | (328 | ) | ||
Income tax benefit | $ | (8,875 | ) | |
For the Period | ||||||||||
from Inception to | ||||||||||
December 31, 2010 | ||||||||||
(dollars in thousands) | Amount | Percent | ||||||||
Income taxes at statutory federal rate | $ | (21,320 | ) | (35.0 | )% | |||||
State income taxes, net of federal income tax effect | (213 | ) | (0.4 | ) | ||||||
Nondeductible interest — convertible note | 12,529 | 20.6 | ||||||||
Other | 129 | 0.2 | ||||||||
$ | (8,875 | ) | (14.6 | )% | ||||||
F-27
ASSETS (LIABILITIES) | ||||
Equity compensation | $ | 8,616 | ||
Net operating losses | 5,726 | |||
Rents received in advance | 2,920 | |||
Accrued bonus | 2,575 | |||
Other | 489 | |||
Aircraft depreciation | (11,451 | ) | ||
Total assets | $ | 8,875 | ||
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7. | Commitments and Contingencies |
a. | Aircraft Acquisition |
Aircraft Type | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | Total | ||||||||||||||||||||||||
A320/321-200 | 10 | 9 | 13 | 12 | 7 | 51 | ||||||||||||||||||||||||||
A330-200/300 | 2 | 4 | 6 | |||||||||||||||||||||||||||||
B737-800(1) | 5 | 3 | 12 | 12 | 12 | 12 | 9 | 65 | ||||||||||||||||||||||||
B777-300ER | 1 | 1 | ||||||||||||||||||||||||||||||
E190 | 4 | 8 | 3 | 15 | ||||||||||||||||||||||||||||
ATR72-600 | 2 | 8 | 10 | |||||||||||||||||||||||||||||
Total | 24 | 32 | 28 | 24 | 19 | 12 | 9 | 148 | ||||||||||||||||||||||||
(1) | Four of the five Boeing B737-800s that we will acquire in 2011 will be used aircraft. |
(dollars in thousands) | ||||
Years ending December 31, | ||||
2011 | $ | 1,172,086 | ||
2012 | 1,259,316 | |||
2013 | 1,089,748 | |||
2014 | 1,057,055 | |||
2015 | 818,378 | |||
Thereafter | 791,475 | |||
Total | $ | 6,188,058 | ||
b. | Office Lease |
F-29
(dollars in thousands) | ||||
Years ending December 31, | ||||
2011 | $ | 217 | ||
2012 | 1,441 | |||
2013 | 2,325 | |||
2014 | 2,395 | |||
2015 | 2,467 | |||
Thereafter | 23,389 | |||
Total | $ | 32,234 | ||
8. | Net Loss Per Share |
For the period | ||||
from Inception to | ||||
(In thousands, except share data) | December 31, 2010 | |||
Numerator: | ||||
Net loss available to common shareholders — basic and diluted EPS | $ | (52,040 | ) | |
Denominator: | ||||
Weighted average common shares outstanding — basic and diluted EPS | 39,511,045 | |||
Net loss per share: | ||||
Basic | $ | (1.32 | ) | |
Diluted | $ | (1.32 | ) | |
F-30
9. | Interest |
For the period | ||||
from Inception to | ||||
December 31, 2010 | ||||
Interest on borrowings | $ | 12,831 | ||
Less capitalized interest | (1,769 | ) | ||
Interest | 11,062 | |||
Amortization of deferred debt issuance cost | 4,883 | |||
Amortization of convertible debt discounts | 35,798 | |||
Interest expense | $ | 51,743 | ||
10. | Fair Value Measurements |
a. | Assets and Liabilities Measured at Fair Value on a Recurring Basis |
b. | Assets and Liabilities Measured at Fair Value on a Non-recurring Basis |
11. | Fair Value of Financial Instruments |
F-31
12. | Equity Based Compensation |
a. | Incentive Stock Options |
Dividend yield | 0.0% | |||
Expected term | 6.0 years | |||
Risk-free interest rate | 2.3% | |||
Volatility | 52.7% | |||
Forfeiture rate | 0.4% | |||
F-32
Remaining | Aggregate | |||||||||||||||
Exercise | Contractual Term | Intrinsic Value | ||||||||||||||
Shares | Price | (in years) | (in thousands) | |||||||||||||
Options outstanding at inception | — | |||||||||||||||
Granted | 3,225,908 | $ | 20.00 | $ | — | |||||||||||
Exercised | — | |||||||||||||||
Cancelled | — | |||||||||||||||
Options outstanding as of December 31, 2010 | 3,225,908 | $ | 20.00 | 9.5 | $ | — | ||||||||||
Options exercisable at December 31, 2010 | — | |||||||||||||||
b. | Restricted Stock Unit Plan |
June 4, | July 14, | August 4, 2010 | August 11, 2010 | Total | ||||||||||||||||
(dollars in thousands) | 2010 | 2010 | ||||||||||||||||||
Options | $ | 26,314 | $ | 4,998 | $ | 61 | $ | 1,209 | $ | 32,582 | ||||||||||
RSU | 49,000 | 11,847 | 150 | 3,217 | 64,214 | |||||||||||||||
Total | $ | 75,314 | $ | 16,845 | $ | 211 | $ | 4,426 | $ | 96,796 | ||||||||||
13. | Subsequent Events |
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F-34
![(LOGO)](https://capedge.com/proxy/S-1A/0000950123-11-079177/v59248a4v5924800.gif)
Information not required in prospectus
Item 13. | Other expenses of issuance and distribution |
Amount | ||||
SEC registration fee | $ | 221,277 | ||
FINRA filing fee | 75,500 | |||
Printing expenses | 10,000 | |||
Legal fees and expenses | 400,000 | |||
Accounting fees and expenses | 10,000 | |||
Miscellaneous | 8,223 | |||
Total | $ | 725,000 | ||
Item 14. | Indemnification of directors and officers |
II-1
Item 15. | Recent sales of unregistered securities |
II-2
II-3
Exhibit | ||||
No. | Description | |||
3 | .1* | Restated Certificate of Incorporation of Air Lease Corporation | ||
3 | .2* | Amended and Restated Bylaws of Air Lease Corporation | ||
4 | .1* | Form of Specimen Stock Certificate | ||
4 | .2* | Registration Rights Agreement, dated as of June 4, 2010, between Air Lease Corporation and FBR Capital Markets & Co., as the initial purchaser/placement agent | ||
5 | .1 | Opinion of Munger, Tolles & Olson LLP | ||
10 | .1* | Warehouse Loan Agreement, dated as of May 26, 2010, among ALC Warehouse Borrower, LLC, as Borrower, the Lenders from time to time party hereto, and Credit Suisse AG, New York Branch, as Agent | ||
10 | .2* | Pledge and Security Agreement, dated as of May 26, 2010, among Air Lease Corporation, as Parent, ALC Warehouse Borrower, LLC, as Borrower, the subsidiaries of the Borrower from time to time party hereto, Deutsche Bank Trust Company Americas, as Collateral Agent, and Credit Suisse AG, New York Branch, as Agent | ||
10 | .3* | Amended and Restated Air Lease Corporation 2010 Equity Incentive Plan | ||
10 | .4* | Form of Restricted Stock Unit Award Agreement | ||
10 | .5* | Form of Option Award Agreement | ||
10 | .6 | Warrant No. 3 to purchase 214,500 shares of Common Stock, dated August 25, 2010 (in replacement of Warrant No. 1 to purchase 214,500 shares of Common Stock, dated June 4, 2010) | ||
10 | .7* | Warrant No. 2 to purchase 268,125 shares of Common Stock, dated June 4, 2010 |
II-4
Exhibit | ||||
No. | Description | |||
10 | .8* | Employment Agreement, dated as of February 5, 2010, by and between Air Lease Corporation and Steven F. Udvar-Házy | ||
10 | .9* | Amendment to Employment Agreement, dated as of August 11, 2010, by and between Air Lease Corporation and Steven F. Udvar-Házy | ||
10 | .10* | Employment Agreement, dated as of March 29, 2010, by and between Air Lease Corporation and John L. Plueger | ||
10 | .11* | Amendment to Employment Agreement, dated as of August 11, 2010, by and between Air Lease Corporation and John L. Plueger | ||
10 | .12* | Form of Indemnification Agreement with directors and officers | ||
10 | .13*† | A320 Family Purchase Agreement, dated July 19, 2010, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .14*† | A330-200 Purchase Agreement, dated September 2, 2010, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .15*† | Purchase Agreement Number PA-03524, dated as of September 30, 2010, by and between Air Lease Corporation and The Boeing Company | ||
10 | .16*† | Purchase Agreement, dated October 5, 2010, by and between Air Lease Corporation and Embraer — Empresa Brasileira de Aeronáutica S.A. | ||
10 | .17* | Amended and Restated Deferred Bonus Plan | ||
10 | .18* | Form of Grant Notice for Non-Employee Director Restricted Stock Units | ||
10 | .19*† | Amendment N° 1 to the A320 Family Purchase Agreement, dated December 1, 2010, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .20*† | Amendment N° 2 to the A320 Family Purchase Agreement, dated December 1, 2010, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .21*† | Amendment N° 1 to the A330-200 Purchase Agreement, dated December 1, 2010, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .22*† | Amendment N° 2 to the A330-200 Purchase Agreement, dated January 6, 2011, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .23*† | Amendment N° 3 to the A330-200 Purchase Agreement, dated January 14, 2011, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .24*† | Amendment N° 4 to the A330-200 Purchase Agreement, dated February 11, 2011, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .25*† | Amendment No. 1 to the Purchase Agreement COM0188-10, dated January 4, 2011, by and between Air Lease Corporation and Embraer S.A. (f/k/a Embraer — Empresa Brasileira de Aeronáutica S.A.) | ||
10 | .26*† | Amendment No. 2 to the Purchase Agreement COM0188-10, dated February 11, 2011, by and between Air Lease Corporation and Embraer S.A. (f/k/a Embraer — Empresa Brasileira de Aeronáutica S.A.) | ||
10 | .27*† | Aircraft Sale and Purchase Agreement, dated November 5, 2010, by and among Air Lease Corporation, the other purchasers listed in Schedule 1 thereto and the sellers listed in Schedule 1 thereto | ||
10 | .28*† | Amendment No. 4 to the Purchase AgreementCOM0188-10, dated March 21, 2011, by and between Air Lease Corporation and Embraer S.A. (f/k/a Embraer — Empresa Brasileira de Aeronáutica S.A.) | ||
10 | .29*† | Amendment No. 5 to the Purchase AgreementCOM0188-10, dated March 21, 2011, by and between Air Lease Corporation and Embraer S.A. (f/k/a Embraer — Empresa Brasileira de Aeronáutica S.A.) | ||
10 | .30*† | Amendment No. 3 to the Purchase AgreementCOM0188-10, dated February 28, 2011, by and between Air Lease Corporation and Embraer S.A. (f/k/a Embraer — Empresa Brasileira de Aeronáutica S.A.) |
II-5
Exhibit | ||||
No. | Description | |||
10 | .31* | First Amendment to Warehouse Loan Agreement, dated as of April 1, 2011, among ALC Warehouse Borrower, LLC, as Borrower, the Lenders from time to time party hereto, and Credit Suisse AG, New York Branch, as Agent | ||
10 | .32† †† | Supplemental Agreement No. 1 to Purchase Agreement Number PA-03524, dated as of June 30, 2011, by and between Air Lease Corporation and The Boeing Company | ||
10 | .33† †† | Purchase Agreement PA-03658, dated August 5, 2011, by and between Air Lease Corporation and The Boeing Company | ||
21 | .1 | List of Subsidiaries of Air Lease Corporation | ||
23 | .1 | Consent of KPMG LLP | ||
23 | .2 | Consent of Munger, Tolles & Olson LLP (included in Exhibit 5.1) | ||
23 | .3 | Consent of AVITAS, Inc. | ||
24 | .1†† | Power of Attorney | ||
* | Incorporated by reference to the exhibit of the same number filed with the Registrant’s Registration Statement on Form S-1 (File No. 333-171734) for our initial public offering. | |
** | To be filed by amendment. | |
† | The registrant has omitted confidential portions of the referenced exhibit and filed such confidential portions separately with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 406 promulgated under the Securities Act of 1933, as amended. | |
†† | Previously filed. |
Item 17. | Undertakings |
II-6
AIR LEASE CORPORATION | ||||||
By: | /s/ John L. Plueger | |||||
Title: President & Chief Operating Officer |
Signature | Title | Date | ||
/s/ Steven F. Udvar-Házy | Principal Executive Officer | August 22, 2011 | ||
/s/ James C. Clarke | Principal Financial Officer | August 22, 2011 | ||
/s/ Gregory B. Willis | Principal Accounting Officer | August 22, 2011 | ||
/s/ Steven F. Udvar-Házy | Director | August 22, 2011 | ||
/s/ John L. Plueger | Director | August 22, 2011 | ||
* | Director | August 22, 2011 | ||
* | Director | August 22, 2011 | ||
* | Director | August 22, 2011 | ||
* | Director | August 22, 2011 | ||
* | Director | August 22, 2011 | ||
* | Director | August 22, 2011 | ||
II-7
Signature | Title | Date | ||
* | Director | August 22, 2011 | ||
* | Director | August 22, 2011 | ||
By: /s/ John L. Plueger | ||||
Attorney-in-Fact |
II-8
Exhibit | ||||
No. | Description | |||
3 | .1* | Restated Certificate of Incorporation of Air Lease Corporation | ||
3 | .2* | Amended and Restated Bylaws of Air Lease Corporation | ||
4 | .1* | Form of Specimen Stock Certificate | ||
4 | .2* | Registration Rights Agreement, dated as of June 4, 2010, between Air Lease Corporation and FBR Capital Markets & Co., as the initial purchaser/placement agent | ||
5 | .1 | Opinion of Munger, Tolles & Olson LLP | ||
10 | .1* | Warehouse Loan Agreement, dated as of May 26, 2010, among ALC Warehouse Borrower, LLC, as Borrower, the Lenders from time to time party hereto, and Credit Suisse AG, New York Branch, as Agent | ||
10 | .2* | Pledge and Security Agreement, dated as of May 26, 2010, among Air Lease Corporation, as Parent, ALC Warehouse Borrower, LLC, as Borrower, the subsidiaries of the Borrower from time to time party hereto, Deutsche Bank Trust Company Americas, as Collateral Agent, and Credit Suisse AG, New York Branch, as Agent | ||
10 | .3* | Amended and Restated Air Lease Corporation 2010 Equity Incentive Plan | ||
10 | .4* | Form of Restricted Stock Unit Award Agreement | ||
10 | .5* | Form of Option Award Agreement | ||
10 | .6 | Warrant No. 3 to purchase 214,500 shares of Common Stock, dated August 25, 2010 (in replacement of Warrant No. 1 to purchase 214,500 shares of Common Stock, dated June 4, 2010) | ||
10 | .7* | Warrant No. 2 to purchase 268,125 shares of Common Stock, dated June 4, 2010 | ||
10 | .8* | Employment Agreement, dated as of February 5, 2010, by and between Air Lease Corporation and Steven F. Udvar-Házy | ||
10 | .9* | Amendment to Employment Agreement, dated as of August 11, 2010, by and between Air Lease Corporation and Steven F. Udvar-Házy | ||
10 | .10* | Employment Agreement, dated as of March 29, 2010, by and between Air Lease Corporation and John L. Plueger | ||
10 | .11* | Amendment to Employment Agreement, dated as of August 11, 2010, by and between Air Lease Corporation and John L. Plueger | ||
10 | .12* | Form of Indemnification Agreement with directors and officers | ||
10 | .13*† | A320 Family Purchase Agreement, dated July 19, 2010, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .14*† | A330-200 Purchase Agreement, dated September 2, 2010, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .15*† | Purchase Agreement Number PA-03524, dated as of September 30, 2010, by and between Air Lease Corporation and The Boeing Company | ||
10 | .16*† | Purchase Agreement, dated October 5, 2010, by and between Air Lease Corporation and Embraer — Empresa Brasileira de Aeronáutica S.A. | ||
10 | .17* | Amended and Restated Deferred Bonus Plan | ||
10 | .18* | Form of Grant Notice for Non-Employee Director Restricted Stock Units | ||
10 | .19*† | Amendment N° 1 to the A320 Family Purchase Agreement, dated December 1, 2010, by and between Air Lease Corporation and Airbus S.A.S. |
II-9
Exhibit | ||||
No. | Description | |||
10 | .20*† | Amendment N° 2 to the A320 Family Purchase Agreement, dated December 1, 2010, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .21*† | Amendment N° 1 to the A330-200 Purchase Agreement, dated December 1, 2010, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .22*† | Amendment N° 2 to the A330-200 Purchase Agreement, dated January 6, 2011, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .23*† | Amendment N° 3 to the A330-200 Purchase Agreement, dated January 14, 2011, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .24*† | Amendment N° 4 to the A330-200 Purchase Agreement, dated February 11, 2011, by and between Air Lease Corporation and Airbus S.A.S. | ||
10 | .25*† | Amendment No. 1 to the Purchase Agreement COM0188-10, dated January 4, 2011, by and between Air Lease Corporation and Embraer S.A. (f/k/a Embraer — Empresa Brasileira de Aeronáutica S.A.) | ||
10 | .26*† | Amendment No. 2 to the Purchase Agreement COM0188-10, dated February 11, 2011, by and between Air Lease Corporation and Embraer S.A. (f/k/a Embraer — Empresa Brasileira de Aeronáutica S.A.) | ||
10 | .27*† | Aircraft Sale and Purchase Agreement, dated November 5, 2010, by and among Air Lease Corporation, the other purchasers listed in Schedule 1 thereto and the sellers listed in Schedule 1 thereto | ||
10 | .28*† | Amendment No. 4 to the Purchase AgreementCOM0188-10, dated March 21, 2011, by and between Air Lease Corporation and Embraer S.A. (f/k/a Embraer — Empresa Brasileira de Aeronáutica S.A.) | ||
10 | .29*† | Amendment No. 5 to the Purchase AgreementCOM0188-10, dated March 21, 2011, by and between Air Lease Corporation and Embraer S.A. (f/k/a Embraer — Empresa Brasileira de Aeronáutica S.A.) | ||
10 | .30*† | Amendment No. 3 to the Purchase AgreementCOM0188-10, dated February 28, 2011, by and between Air Lease Corporation and Embraer S.A. (f/k/a Embraer — Empresa Brasileira de Aeronáutica S.A.) | ||
10 | .31* | First Amendment to Warehouse Loan Agreement, dated as of April 1, 2011, among ALC Warehouse Borrower, LLC, as Borrower, the Lenders from time to time party hereto, and Credit Suisse AG, New York Branch, as Agent | ||
10 | .32† †† | Supplemental Agreement No. 1 to Purchase Agreement Number PA-03524, dated as of June 30, 2011, by and between Air Lease Corporation and The Boeing Company | ||
10 | .33† †† | Purchase Agreement PA-03658, dated as of August 5, 2011, by and between Air Lease Corporation and The Boeing Company | ||
21 | .1 | List of Subsidiaries of Air Lease Corporation | ||
23 | .1 | Consent of KPMG LLP | ||
23 | .2 | Consent of Munger, Tolles & Olson LLP (included in Exhibit 5.1) | ||
23 | .3 | Consent of AVITAS, Inc. | ||
24 | .1†† | Power of Attorney | ||
* | Incorporated by reference to the exhibit of the same number filed with the Registrant’s Registration Statement on Form S-1 (File No. 333-171734) for our initial public offering. | |
** | To be filed by amendment. | |
† | The registrant has omitted confidential portions of the referenced exhibit and filed such confidential portions separately with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 406 promulgated under the Securities Act of 1933, as amended. | |
†† | Previously filed. |
II-10