| Item 3.03. | Material Modification to Rights of Security Holders. |
As of the issuance by Air Lease Corporation (the “Company”) of its 4.125% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series C, par value $0.01, with a liquidation preference of $1,000.00 per share (the “Series C Preferred Stock”) on October 13, 2021, the ability of the Company to declare or pay dividends on, or purchase, redeem or otherwise acquire, shares of its common stock or any shares of other stock of the Company that rank junior to the Series C Preferred Stock either as to the payment of dividends and/or as to the distribution of assets upon the liquidation, dissolution or winding up of the Company is subject to certain restrictions in the event that the Company does not declare and pay (or set aside) dividends on the Series C Preferred Stock for the last preceding dividend period. In addition, as of the issuance by the Company of its Series C Preferred Stock on October 13, 2021, the ability of the Company to purchase, redeem or otherwise acquire shares of its 6.150% Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series A, par value $0.01, with a liquidation preference of $25.00 per share (the “Series A Preferred Stock”), 4.650% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series B, par value $0.01, with a liquidation preference of $1,000.00 per share (the “Series B Preferred Stock”) or any shares of other stock of the Company that rank on a parity with the Series C Preferred Stock as to the payment of dividends is subject to certain restrictions in the event that the Company does not declare and pay (or set aside) dividends on the Series C Preferred Stock for the last preceding dividend period.
The terms of the Series C Preferred Stock, including such restrictions, are more fully described in Item 5.03 below, and this description is qualified in its entirety by reference to the Certificate of Designations (as defined in Item 5.03 below), a copy of which is filed as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated herein by reference.
| Item 5.03. | Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year. |
On October 11, 2021, the Company filed a Certificate of Designations (the “Certificate of Designations”) with the Secretary of State of the State of Delaware to establish the preferences, voting powers, limitations as to dividends or other distributions, qualifications, terms and conditions of redemption and other terms and conditions of the Series C Preferred Stock. On October 13, 2021, the Company completed a public offering of, and issued, 300,000 shares (the “Shares”) of the Series C Preferred Stock. The following is a summary description of those terms and the general effect of the issuance of the Shares on the Company’s other classes of registered securities.
The Series C Preferred Stock ranks senior to the Company’s common stock and any other class or series of the Company’s subsequently issued capital stock expressly designated as ranking junior to the Series C Preferred Stock. The Series C Preferred Stock ranks on a parity with the Company’s previously issued Series A Preferred Stock and Series B Preferred Stock. The Series C Preferred Stock ranks junior in right of payment to the Company’s existing and future debt obligations, including any subordinated debt, and liabilities.
The Series C Preferred Stock has no stated maturity and is not subject to mandatory redemption or any sinking fund. In the event of the Company’s liquidation, dissolution or winding up, whether voluntary or involuntary, before any distribution or payment out of the Company’s assets may be made to or set aside for the holders of junior stock, holders of the Series C Preferred Stock are entitled to receive out of the Company’s assets legally available for distribution to its stockholders (i.e., after satisfaction of all the Company’s liabilities to creditors, if any) an amount equal to $1,000.00 per share of the Series C Preferred Stock, plus any dividends that have been declared but not paid prior to the date of payment of distributions to stockholders, without regard to any undeclared dividends.
The Company will pay dividends on the Series C Preferred Stock when, as and if declared by its board of directors (or a duly authorized committee of its board of directors), only out of funds legally available for payment of dividends. Dividends on the Series C Preferred Stock will accrue on the stated amount of $1,000.00 per share of the Series C Preferred Stock at a rate per annum equal to (i) 4.125% from October 13, 2021 to, but excluding, December 15, 2026 (the “First Reset Date”) and (ii) the Five-year U.S. Treasury Rate (as defined in the Certificate of Designations) as of the most recent Reset Dividend Determination Date (as defined in the Certificate of Designations) plus 3.149% for each Reset Period (as defined in the Certificate of Designations) from, and including, the First Reset Date, payable quarterly in arrears. Dividends on the Series C Preferred Stock will not be cumulative and will not be mandatory.
