EXHIBIT A
MORGAN STANLEY AIRCRAFT FINANCE
Report to Noteholders
All amounts in US dollars unless otherwise stated
Payment Date 15th of each month
Convention Modified Following Business Day
Current Payment Date 15-Mar-00
Current Calculation Date 9-Mar-00
Previous Payment Date 15-Feb-00
Previous Calculation Date 9-Feb-00
- ------------------------------------------------------------------------------------------
1. Account Activity Summary between Calculation Dates
- ------------------------------------------------------------------------------------------
Prior Deposits Withdrawals Balance on
Balance Calculation Date
9-Feb-00 9-Mar-00
- ------------------------------------------------------------------------------------------
Expense Account 5,796,529.87 774,806.71 (1,645,925.95) 4,925,410.63
Collection Account 8,329,576.35 11,839,964.39 (8,329,576.35) 11,839,964.39
Aircraft Purchase Account - - - -
Liquidity Reserve cash balance 25,000,000.00 - - 25,000,000.00
- ------------------------------------------------------------------------------------------
Total 39,126,106.22 12,614,771.10 (9,975,502.30) 41,765,375.02
- ------------------------------------------------------------------------------------------
2. Analysis of Expenses Account Activity
- ------------------------------------------------------------------------------------------
Opening Balance on Previous Calculation Date 5,796,529.87
Transfer from Collection Account on previous Payment Date 721,805.73
Permitted Aircraft Accrual
Interim Transfer from Collection Account 26,027.19
Interest Income 26,973.79
Balance on current Calculation Date
- Payments on previous payment date (429,165.65)
- Interim payments (1,216,760.30)
- other
- ------------------------------------------------------------------------------------------
Balance on current Calculation Date 4,925,410.63
- ------------------------------------------------------------------------------------------
3. Analysis of Collection Account Activity
- ------------------------------------------------------------------------------------------
Opening Balance on Previous Calculation Date 8,329,576.35
Collections during period
- lease rentals 10,456,041.00
- maintenance reserves 884,685.02
- other leasing income 105,964.13
- interest income 149,884.93
- lease rental received in error 269,416.50
- interim transfer to Expense A/C (26,027.19)
Transfers from Aircraft Purchase Account -
Drawings under Credit or Liquidity Enhancement Facilities -
Repayment of Drawings under Credit or Liquidity Enhancement Facilities -
Transfer to Expense Account on previous Payment Date
- Required Expense Amount (721,805.73)
- Permitted Aircraft Modifications
Net Swap payments on previous Payment Date (173,868.06)
Aggregate Note Payments on previous Payment Date (7,433,902.56)
Interim Transfer to Expense Account
- ------------------------------------------------------------------------------------------
Balance on current Calculation Date 11,839,964.39
- ------------------------------------------------------------------------------------------
Analysis of Liquidity Reserve Amount
First Collection Account Reserve 15,000,000.00
Second Collection Account Reserve 10,000,000.00
Morgan Stanley Facility 10,000,000.00
ILFC Facility
- Letter of Credit 10,000,000.00
- Cash Security Deposits 19,638,351.00 29,638,351.00
----------------
Liquidity Reserve Amount 64,638,351.00
----------------
Minimum Liquidity Reserve Amount 15,000,000.00
- ------------------------------------------------------------------------------------------
Current Payment Date 15-Mar-00
Current Calculation Date 9-Mar-00
Previous Payment Date 15-Feb-00
Previous Calculation Date 9-Feb-00
- ----------------------------------------------------------------------------------------------------------------
Balance in Collection Account 11,839,964.39
Liquidity Reserve Amount 64,638,351.00
------------------
Available Collections 76,478,315.39
==================
3. Analysis of Collection Account Activity (Continued)
- ----------------------------------------------------------------------------------------------------------------
Analysis of Current Payment Date Distributions
(I) Required Expense Amount 1,305,625.34
(II) a) Class A Interest but excluding Step-up 3,116,718.47
b) Swap Payments other than subordinated swap payments 378,805.56
(iii)a) Repayment of Primary Eligible Credit Facilities -
b) First Collection Account top-up (Minimum liquidity reserve $15 m) 15,000,000.00
(iv) Class A Minimum principal payment -
(v) Class B Interest 474,018.92
(vi) Class B Minimum principal payment 328,861.26
(vii) Class C Interest 574,482.50
(viii) Class C Minimum principal payment -
(ix) Class D Interest 797,500.00
(x) Class D Minimum principal payment -
(xi) a) Secondary Eligible Credit Facilities (ILFC and Morgan Stanley Facilities) -
b) Second collection account top-up 49,638,351.00
(xii) Class A Scheduled principal -
(xiii) Class B Scheduled principal -
(xiv) Class C Scheduled principal 33,193.00
(xv) Class D Scheduled principal -
(xvi) Permitted accruals for Modifications
(xvii) Step-up interest -
(xviii) Beneficial interest -
(xix) Class A Supplemental principal 4,830,759.35
(xx) Class B Supplemental principal -
(xxi) Class D Redemption Price -
(xxii) Class C Redemption Price -
(xxiii) Class B Redemption Price -
(xxiv) Class A Redemption Price -
(xxv) Subordinated Swap payments -
(xxvi) all remaining amounts to holders of Beneficial interests
Total Payments with respect to Payment Date 76,478,315.39
less collection Account Top Ups (iii) (b) and (xi) (b) above 64,638,351.00
------------------
11,839,964.39
==================
- ----------------------------------------------------------------------------------------------------------------
Current Payment Date 15-Mar-00
Current Calculation Date 9-Mar-00
Previous Payment Date 15-Feb-00
Previous Calculation Date 9-Feb-00
- -------------------------------------------------------------------------------------------
4. Payments on the Notes by Subclass
- -------------------------------------------------------------------------------------------
Subclass Subclass Subclass
(a) Floating Rate Notes A-1* A-2 B-1
- -------------------------------------------------------------------------------------------
Applicable LIBOR 5.88500% 5.88500% 5.8850%
Applicable Margin 0.2100% 0.3500% 0.6500%
Applicable Interest Rate 6.09500% 6.23500% 6.53500%
Day Count Act/360 Act/360 Act/360
Actual Number of Days 29 29 29
Interest Amount Payable 1,963,944.44 1,152,774.03 474,018.92
Step-up Interest Amount Payable - NA NA
- -------------------------------------------------------------------------------------------
Total Interest Paid 1,963,944.44 1,152,774.03 474,018.92
- -------------------------------------------------------------------------------------------
Expected Final Payment Date 15-Mar-00 15-Sep-05 15-Mar-13
Excess Amortisation Date 15-Mar-00 15-Apr-98 15-Apr-98
- -------------------------------------------------------------------------------------------
Original Balance 400,000,000.00 340,000,000.00 100,000,000.00
Opening Outstanding Principal Balance 400,000,000.00 229,515,609.82 90,043,960.05
- -------------------------------------------------------------------------------------------
Extended Pool Factors 100.00% 82.68% 96.07%
expected Pool Factors 100.00% 74.28% 92.12%
- -------------------------------------------------------------------------------------------
Extension Amount - - 328,861.26
expected Pool Factor Amount - - -
Surplus Amortisation 4,830,759.35 -
- -------------------------------------------------------------------------------------------
Total Principal Distribution Amount - 4,830,759.35 328,861.26
- -------------------------------------------------------------------------------------------
Redemption Amount
- - amount allocable to principal
- - amount allocable to premium
- -------------------------------------------------------------------------------------------
Closing Outstanding Principal Balance 400,000,000.00 224,684,850.47 89,715,098.79
- -------------------------------------------------------------------------------------------
*Subclass A-1 will be refinanced on March 15, 2000, the Expected Final Payment Date for this subclass.
- ------------------------------------------------------------------------
(b) Fixed Rate Notes C-1 D-1
- ------------------------------------------------------------------------
Applicable Interest Rate 6.90000% 8.70000%
Day count 30 / 360 30 / 360
Number of Days 30 30
Interest Amount Payable 574,482.50 797,500.00
- ------------------------------------------------------------------------
Total Interest Paid 574,482.50 797,500.00
- ------------------------------------------------------------------------
Expected Final Payment Date 15-Mar-13 15-Mar-14
Excess Amortisation Date 15-Mar-13 15-Mar-10
Original Balance 100,000,000.00 110,000,000.00
Opening Outstanding Principal Balance 99,910,000.00 110,000,000.00
- ------------------------------------------------------------------------
Extended Pool Factors 100.00% 100.00%
expected Pool Factors 99.88% 100.00%
- ------------------------------------------------------------------------
Extended Amount - -
expected Pool Factor amount 33,193.00 -
- -------------
Surplus Amortisation -
- ------------------------------------------------------------------------
Total Principal Distribution Amount 33,193.00 -
- ------------------------------------------------------------------------
Redemption Amount - -
- - amount allocable to principal - -
- - amount allocable to premium - -
- ------------------------------------------------------------------------
Closing Outstanding Principal Balance 99,876,807.00 110,000,000.00
- ------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Current Payment Date 15-Mar-00
Current Calculation Date 9-Mar-00
Previous Payment Date 15-Feb-00
Previous Calculation Date 9-Feb-00
- -------------------------------------------------------------------------------
5. Floating Rate Note information for next Interest Accrual Period
Start of Interest Accrual Period 15-Mar-00
End of Interest Accrual Period 15-Jun-99
Reference Date 11-Mar-00
- -------------------------------------------------------------------------------
A-1 A-2 B-1
- -------------------------------------------------------------------------------
Applicable LIBOR 6.00375% 6.00375% 6.00375%
Applicable Margin 0.2100% 0.3500% 0.6500%
Applicable Interest Rate 6.21375% 6.3538% 6.6538%
Actual Pool Factor 100.00% 66.08% 89.72%
- -------------------------------------------------------------------------------
- ------------------------------------------------------------------
Fixed Rate Notes C-1 D-1
- ------------------------------------------------------------------
Actual Pool Factor 99.88% 100.00%
- ------------------------------------------------------------------
- -------------------------------------------------------------------------------
6. Payments per $ 100,000 Inital Outstanding Principal Balance of Notes
- -------------------------------------------------------------------------------
(a) Floating Rate Notes A-1 A-2 B-1
- -------------------------------------------------------------------------------
Opening Outstanding Principal Balance 100,000.00 67,504.59 90,043.96
Total Principal Payments - 1,420.81 328.86
Closing Outstanding Principal Balance 100,000.00 66,083.78 89,715.10
Total Interest 490.99 339.05 474.02
Total Premium - - -
- -------------------------------------------------------------------------------
- ------------------------------------------------------------------
(b) Fixed Rate Notes C-1 D-1
- ------------------------------------------------------------------
Opening Outstanding Principal Balance 99,910.00 100,000.00
Total Principal Payments 33.19 -
Closing Outstanding Principal Balance 99,876.81 100,000.00
Total Interest 574.48 725.00
Total Premium - -
- ------------------------------------------------------------------
- -------------------------------------------------------------------------------
Performance to Date versus 1998 Base Case
Mar 3, 1998 - Mar 15, 2000
All amounts in US dollars millions unless otherwise stated
- ------------------------------------------------------------------------------------- ----------------------------------
1998 % of 1998 Base Case Lease Rentals
CASH COLLECTIONS Actual Basecase Variance Actual* Base Case Variance
- ------------------------------------------------------------------------------------- ----------------------------------
[1] Lease Rentals 265.1 265.1 - 100.0% 100.0% 0.0%
[2] - Renegotiated Leases (1.8) - (1.8) -0.7% 0.0% -0.7%
[3] - Rental Resets (2.8) - (2.8) -1.0% 0.0% -1.0%
----------------------------------------- ----------------------------------
[4] Sum of [1]..[3] Contracted Lease Rentals 260.6 265.1 (4.5) 98.3% 100.0% -1.7%
[5] Movement in Current Arrears Balance (3.2) - (3.2) -1.2% -1.2%
less Net Stress-related Costs
[6] - Bad debts (5.8) - -2.2%
[7] - Capitalised arrears (3.5) -1.3%
[8] - Security deposits drawn down 4.5 - -1.7%
[9] - AOG (11.9) - -4.5%
[10] - Other Leasing Income 4.0 - 1.5%
[11] - Repossession (2.2) -0.8%
---------------------------------------- ----------------------------------
[12] Sum of [6]..[11] sub-total (14.9) (11.9) (2.9) -5.6% -4.5% -1.1%
[13] [4]+[5]+[12] Net Lease Rentals 242.6 253.2 (10.6) 91.5% 95.5% -4.0%
-
[14] Interest Earned 4.5 2.8 1.7 1.7% 1.1% 0.6%
[15] Net Maintenance 6.3 - 6.3 2.4% 0.0% 2.4%
---------------------------------------- ----------------------------------
[16] Sum of [13]..[15] Total Cash Collections 253.4 256.1 (2.7) 95.6% 96.6% -1.0%
-
- ------------------------------------------------------------------------------------- ----------------------------------
CASH EXPENSES
Aircraft Operating Expenses
[17] - Insurance (0.7) -0.3%
[18] - Re-leasing and other overheads (1.1) -0.4%
---------------------------------------- ----------------------------------
[19] [17]+[18] subtotal (1.8) (9.3) 7.5 -0.7% -3.5% 2.8%
SG&A Expenses
[20] Aircraft Servicer Fees
- Base Fee (4.3)
- Rent Collected Fee (2.4)
- Rent Contracted Fee (2.5)
- Incentive Fee (0.5)
---------------------------------------- ----------------------------------
[21] [20] sub-total (9.6) (11.5) 1.9 -3.6% -4.4% 0.7%
[22] Other Servicer Fees (5.8) (6.6) 0.9 -2.2% -2.5% 0.3%
---------------------------------------- ----------------------------------
[23] [21]+[22] subtotal (15.4) (18.2) 2.8 -5.8% -6.9% 1.0%
---------------------------------------- ----------------------------------
[24] [19]+[23] Total Cash Expenses (17.2) (27.5) 10.2 -6.5% -10.4% 3.9%
- ------------------------------------------------------------------------------------- ----------------------------------
NET CASH COLLECTIONS
[25] [16] Total Cash Collections 253.4 256.1 (2.7) 95.6% 96.6% -1.0%
[26] [24] Total Cash Expenses (17.2) (27.5) 10.2 -6.5% -10.4% 3.9%
[27] Interest Payments (124.8) (129.8) 5.1 -47.1% -49.0% 1.9%
[28] Swap Payments (12.8) (7.5) (5.3) -4.8% -2.8% -2.0%
[29] Exceptional Item 27.1 27.1 - 10.2% 10.2% 0.0%
---------------------------------------- ----------------------------------
[30] Sum of [25]..[29] TOTAL 125.7 118.4 7.3 47.4% 44.7% 2.8%
======================================== ==================================
- ---------------------------------------------------------------------------------------- -------------------------------
[31] PRINCIPAL PAYMENTS
subclass A1 - -
subclass A2 115.3 108.0 7.3 43.5% 40.7% 2.8%
subclass B1 10.3 10.3 (0.0) 3.9% 3.9% 0.0%
subclass C1 0.1 0.1 0.0 0.0% 0.0% 0.0%
subclass D1 - -
---------------------------------------- ----------------------------------
Total 125.7 118.4 7.3 47.4% 44.7% 2.8%
======================================== ==================================
0.0
- -------------------------------------------------------------------------------------------------------------------------
Debt Balances
subclass A1 400.00 400.00
subclass A2 224.68 232.01
subclass B1 89.72 89.72
subclass C1 99.88 99.88
subclass D1 110.00 110.00
-----------------------------
924.28 931.61
-----------------------------
- ---------------------------------------------------------------------------------------------------------
Coverage Ratios 1998
---------------
Closing Actual Base Case
- ---------------------------------------------------------------------------------------------------------
Net Cash Collections 125.7 118.4
Add Back Interest and Swap Payments 137.6 137.3
--------
Add Back Permitted Accruals 1.6
--------
a Net Cash Collections 264.9 255.7
b Swaps 12.8 7.5
c Class A Interest 79.3 83.9
d Class A Minimum 15.2 22.2
e Class B Interest 11.9 12.4
f Class B Minimum 10.3 10.3
g Class C Interest 14.1 14.0
h Class C Minimum 0.0 0.0
I Class D Interest 19.5 19.5
j Class D Minimum - -
k Class A Scheduled - -
l Class B Scheduled - -
m Class C Scheduled 0.1 0.1
n Class D Scheduled 0.0 -
o Permited Aircraft Modifications 1.6 -
p Class A Supplemental 100.1 85.8
---------------------------
Total 264.9 255.7
---------------------------
[1] Interest Coverage Ratio
Class A 2.88 2.80
Class B 2.22 2.03
Class C 1.85 1.70
Class D 1.62 1.51
[2] Debt Coverage Ratio
Class A 1.62 1.51
Class B 1.62 1.51
Class C 1.62 1.51
Class D 1.62 1.51
Loan-to-Value Ratios( in US dollars)
[3] Assumed Portfolio Value 1,115,510,000 1,001,284,585
[4] Adjusted Portfolio Value 948,988,469
Liquidity Reserve Amount
Of which - Cash 25,000,000 25,000,000 25,000,000
- Accrued Expenses 5,458,700
- Letter of
Credit held 40,000,000 39,638,351 39,638,351
--------------- --------------------------
Subtotal 65,000,000 70,097,051 64,638,351
Less Lessee Security
Deposits (20,000,000) (19,038,351) (19,038,351)
Subtotal 45,000,000 51,058,700 45,600,000
[5] Total Asset Value 1,160,510,00 1,000,047,169 1,046,884,585
Note Balances as at February 15, 2000
Class A 740,000,000 63.8% 624,684,850 62.5% 632,007,823 60.4%
Class B 100,000,000 72.4% 89,715,099 71.4% 89,715,099 68.9%
Class C 100,000,000 81.0% 99,876,807 81.4% 99,876,807 78.5%
Class D 110,000,000 90.5% 110,000,000 92.4% 110,000,000 89.0%
------------- -------------------------------
Total 1,050,000,000 924,276,756 931,599,729
- ---------------------------------------------------------------------------------------------------------
*Assumed Cash Collections and Cash Expenses have been adjusted for non-delivery
of an aircraft.
[1] Interest Coverage Ratio is equal to Net Cash Collections (excl. interest
and swap payments) expressed as a ratio of the interest payable on each
subclass of Notes that rank senior in priority of payment to the relevant
subclass of Notes.
[2] Debt Service Ratio is equal to Net Cash Collections (excl. interest and
swap payments) expressed as a ratio of the interest and minimum and scheduled
principal payments payable on each subclass of Notes that ranks equally with or
senior to the relevant subclass of Notes in the priority of payments.
[3] Assumed Portfolio Value represents the Inital Appraised Value of each
aircraft in the Portfolio multipled by the Depreciation Factor at Calculation
date divided by the Depreciation Factor at Closing date.
[4] Adjusted Portfolio Value represents the Base Value of each aircraft in the
Portfolio as detemined by the most recent Appraisal multipled by the
Depreciation Factor at Calculation date divided by the Depreciation Factor at
Closing date.
The lower of the Assumed Portfolio Value or 105% of the Adjusted Portfolio
Value is used to calculate the principal repayment amounts to Noteholders
[5] Total Asset Value is equal to Total Assumed Portfolio Value plus Liquidity
Reserve Amount minus Lessee Security Deposits.
MSAF Performance to DAte
Description of Report Line Items
- -----------------------------------------------------------------------------------------------------------------------------
Note: Report Line Name Description
- -----------------------------------------------------------------------------------------------------------------------------
CASH COLLECTIONS
[1] Lease Rentals Assumptions per the March 1998 Prospectus
[2] - Renegotiated Leases Change in contracted rental cash flow caused by a renegotiated lease
[3] - Rental Resets Re-leasing events where new lease
rate deviated from the 1998 Base Case
[4] Sum of [1]....[3] Contracted Lease Rentals Current Contracted Lease Rentals due as at the latest Calculation Date
[5] Movement in Current Arrears Current contracted lease rentals not received as at the
Balance latest Calculation Date, excluding Bad debts
less Net Stress related Costs
[6] - Bad debts Arrears owed by former lessees and deemed irrecoverable.
[7] - Capitalised arrears Current arrears that have been capitalised and
restructured as a Note Payable.
[8] - Security deposits drawn Security deposits received following a lesse default
[9] - AOG Lost of rental due to an aircraft being off-lease and
non-revenue earning
[10] - Other Leasing Income Includes lease termination payments, rental guarantees and late
payments charges
[11] - Repossession Legal and technical costs incurred in repossessing aircraft.
[12] Sum of [6]..[11] sub-total
[13] [4]+[5]+[12] Net Lease Rental Contracted Lease Rentals less Movement in Current Arrears Balance
and Net Stress related costs
[14] Interest Earned Interest earned on monthly cash balances
[15] Net Maintenance Maintenance Revenue Reserve received less and reimbursements to lessees.
[16] Sum of [13].[15] Total Cash Collections Net Lease Rentals + Interest Earned + Net Maintenance
- ------------------------------------------------------------------------------------------------------------------------------
CASH EXPENSES
Aircraft Operating Expenses All operational costs related to the leasing of aircraft.
[17] - Insurance Premium for contingent insurance policies
[18] - Re-leasing and other Costs associated transferring an aircraft from one lessee to another
[19] [17]+[18] subtotal
SG&A Expenses
[20] Aircraft Servicer Fees Monthly and annual fees paid to Aircraft Servicer
- Base Fee Fixed amount per month per aircraft
- Rent Contracted Fee 1.00% of rental contracted for the month
- Rent Collected Fee 1.25% of rental received for the month
- Incentive Fee Annual fee paid to Servicer for performance above an annually agreed target
[21] [20] subtotal
[22] Other Servicer Fees Administrative Agent, trustee and professional fees paid to other service
providers.
[23] [21]+[22] subtotal
[24] [19]+[23] Total Cash Expenses Aircraft Operating Expenses + SG&A Expenses
- -------------------------------------------------------------------------------------------------------------------------------
NET CASH COLLECTIONS
[25] [16] Total Cash Collections line 16 above
[26] [24] Total Cash Expenses line 24 above
[27] Interest Payments Interest paid on all outstanding debt
[28] Swap payments Net swap payments (paid) /received
[29] Proceeds from Aircraft Sales Proceeds, net of fees and expenses, from the sale of aircraft
[30] Sum if [25].[29] Exceptional Items Includes adjustment for aircraft included in the 1998 Basecase but not
acquired by MSAF
TOTAL
- ------------------------------------------------------------------------------------------------------------------------------
[31]