| Item 1.01. | Entry into a Material Definitive Agreement. |
On December 13, 2024, Air Lease Corporation (the “Company”) and ALC Aircraft Financing Designated Activity Company (the “Ireland Borrower” and together with the Company, the “Borrowers”) entered into the Credit Agreement dated as of December 13, 2024 (as amended or supplemented from time to time, the “Credit Agreement”), by and among the Borrowers, the several lenders from time to time party thereto (the “Lenders”) and Sumitomo Mitsui Trust Bank, Limited, New York Branch, as administrative agent (the “Administrative Agent”). The Credit Agreement provides for a $966.5 million unsecured term loan (the “Term Loan”) that matures on December 13, 2027. The Term Loan is comprised of two tranches, with the Company as the borrower for $351.5 million in commitments under Tranche A and the Ireland Borrower, a wholly owned, indirect subsidiary of the Company as the borrower for $615.0 million in commitments under Tranche B. The Company is jointly and severally liable with the Ireland Borrower for borrowings under Tranche B. The Borrowers have submitted a borrowing notice to draw the full amounts of the Term Loan commitments on December 20, 2024. The Term Loan contains an accordion feature that allows the Borrowers, at their option within six months of the closing date, to increase total commitments up to an additional $33.5 million, subject to the satisfaction of customary conditions including the agreement of lenders to provide the same.
Borrowings under the Credit Agreement accrue interest at the Term SOFR Rate (as defined in the Credit Agreement) plus a margin of 1.125% per year. The margin is subject to increase or decrease based on declines or improvements in the credit ratings for the Company’s debt. The Borrowers, at their option, may voluntarily prepay the principal of the Term Loan without penalty or premium at any time in whole or in part, subject to certain breakage costs. The Term Loan contains customary covenants and events of default consistent with the Company’s syndicated unsecured revolving credit facility.
Some of the lenders party to the Credit Agreement and their affiliates have engaged in, and may in the future engage in, investment banking and other commercial dealings in the ordinary course of business with the Company or its affiliates. They have received, or may in the future receive, customary fees and commissions for these transactions.
The foregoing description of the Credit Agreement is qualified in its entirety by reference to the complete text of the Credit Agreement, which is filed as Exhibit 10.1 and incorporated herein by reference.
| Item 2.03. | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
| Item 7.01. | Regulation FD Disclosure. |
On December 16, 2024, the Company issued a press release announcing entry into the Credit Agreement. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
