SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES AND
EXCHANGE ACT OF 1934
February 28, 2000
(Date of Earliest Event Reported)
AIRPLANES LIMITED AIRPLANES U.S. TRUST
(Exact Name of Registrants as Specified in Memorandum of Association or Trust
Agreement)
Jersey, Channel Islands Delaware
(State or Other Jurisdiction of Incorporation or Organization)
33-99970-01 13-3521640
(Commission File (IRS Employer
Number) Identification No.)
Airplanes Limited Airplanes U.S. Trust
22 Grenville Street 1100 North Market Street
St. Helier Rodney Square North
Jersey, JE4 8PX Wilmington, Delaware
Channel Islands 19890-0001
(011 44 1534 609 000) (1-302-651-1000)
(Addresses and Telephone Numbers, Including Area Codes, of
Registrants' Principal Executive Offices)
Item 5. Other Events
Press Release Dated February 28, 2000.
2
AIRPLANES GROUP
Aviation House, Shannon, Ireland
Telephone: +353 61 360000 Fax: 353 61 360113
PRESS RELEASE
Under the terms of the Airplanes Notes, Airplanes Group ("the Company") is
required annually to commission an appraisal of the Company's fleet. A
consequence of this appraisal is to redirect, when appropriate, excess cashflow
to the Class A Notes (i.e., via the Class A Principal Adjustment Amount).
Reductions in appraised values cannot directly affect interest payments to be
made on Class A, B, C and D Notes but can cause the deferral of targeted
principal payments on the Class C and D Notes and the suspension of interest
payments on the Class E Notes.
The Indentures require the Company to obtain annual appraisals of the "base
values" of each of the Company's aircraft from at least three independent
appraisers that are members of the International Society of Transport Aircraft
Trading ("ISAT"). Since 1996, the Company has obtained its annual appraisals
from Airclaims Limited ("Airclaims"), Aircraft Information Services, Inc.
("AISI") and BK Associates ("BK"). The most recent annual appraisals (as of
February 18, 2000) obtained by the Company are: AISI ($3,439 million), BK
($3,409 million) and Airclaims ($3,173 million). The average of these three
appraisals is $3,340 million (the "2000 Appraised Value"), compared with the
$3,493 million as of February 5, 1999 (as adjusted for sales during the period
to February 18, 2000). In the year to February 2000, the annual decline in the
average appraised value was marginally less than the decline in value implied by
the principal payment provisions of the Airplanes Notes, unlike each of the
three years to 1999 where the annual decline was greater than that implied by
the provisions of the Notes. Over the period since 1996, when the Company
acquired its aircraft, the appraised values obtained from the various individual
appraisers have tended to vary in widely different amounts. In light of this
experience, the Company continues to keep under review the number and
composition of appraisers in deciding how best to comply with its appraisal
obligations in the future.
The decrease represented by the average appraised value of the portfolio as of
February 5, 1999 compared with the average appraised value as of January 23,
1998 was approximately $61 million more than the decrease implied by the terms
of the Airplanes Notes. Greater than implied decreases in value occurred across
most of the Company's fleet of aircraft. However, for the period from February
5, 1999 to February 18, 2000, the decline in average appraised value was
approximately $15 million less than the decrease implied by the terms of the
Airplanes Notes.
The decline in aircraft values for the period to February 5, 1999 resulted in a
Principal Adjustment Amount of $34 million on the Class A Notes which began to
be paid from the February 16, 1999 Payment Date. The payment of Class A
Principal Adjustment Amount resulted in a reallocation of cashflows in favour of
the Class A Notes. Accordingly, during this period there was a suspension of
payments of the Class
3
E Minimum Interest Amount and a deferral of payments of the Class C and D
Scheduled Principal Amounts.
On December 15, 1999, arrears of the Class A Principal Adjustment Amounts were
eliminated and payments of the Class C Scheduled Principal Amounts recommenced.
On January 18, 2000, the deferred Class C Scheduled Principal Amounts were paid
in full and on February 15, 2000, the deferred Class D Scheduled Principal
Amounts were paid in full, and payments of the Class E Minimum Interest Amount
recommenced.
As a result of the 2000 Appraised Value, there will not be an immediate
suspension of any payments. However, the Company will continue to pay Class A
Principal Adjustment Amount in accordance with the terms of the Notes and will
pay items more junior in the order of priorities to the extent of available
cashflows. There can be no assurances that variations in future cashflows, which
are currently suffering from adverse pressure on market lease rates, or future
appraisals will not lead to a suspension of Class C and D Scheduled Principal
and Class E Minimum Interest Amounts.
For further information concerning the Company's results of operations, please
see its Quarterly Report on Form 10-Q for the period to December 31, 1999 which
was filed with the Securities and Exchange Commission.
Further information regarding the Appraisals:
Under the terms of the Indentures governing the Airplanes Notes, the Company is
required at the beginning of each year to obtain appraisals of the "base value"
of its aircraft from at least three independent appraisers. The appraisers
ascertained the "base value" of each aircraft on the basis of an open,
unrestricted, stable market environment as of February 18, 2000 with a
reasonable balance of supply and demand, and with full consideration of each
aircraft's "highest and best use", presuming an arm's-length, cash transaction
between willing, able and knowledgeable parties, acting prudently, with an
absence of duress and with a reasonable time available for marketing, adjusted
to account for the maintenance status of each aircraft (with certain assumptions
as to use since the last reported status). The Company's seven aircraft subject
to finance leases have been included at their net book value rather than
appraised value. The 2000 Appraised Value stated above does not reflect the
value of leases, maintenance reserves, security deposits or other collateral, if
any, related to a particular aircraft. An appraisal is only an estimate of value
and there can be no assurance that proceeds received upon any sale of an
aircraft would approximate the base value of that aircraft.
February 28, 2000
For further information please contact: Patrick Blaney or Ed Hansom of Airplanes
Group's Administrative Agent at tel: 353 61 360000
4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each
of the registrants has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.
AIRPLANES LIMITED
Date: February 28, 2000 /s/ Roy M. Dantzic*
----------------------
Director and Officer
Date: February 28, 2000 AIRPLANES U.S. TRUST
/s/ Roy M . Dantzic*
----------------------
Controlling Trustee
and Officer
*By: /s/ Michael Walsh
-----------------
Attorney-in-Fact
5
EXHIBIT INDEX
Exhibit A - Power of Attorney for Airplanes Limited
Exhibit B - Power of Attorney for Airplanes U.S. Trust
6