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 25, 1997
(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.)
Aiplanes 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 25, 1997
PRESS RELEASE
AIRPLANES GROUP
Under the terms of the Airplanes Notes, Airplanes Group (the "Company") is
required annually to commission an appraisal of the Airplanes Fleet. The
purpose of the appraisal is to redirect, when appropriate, excess cashflow to
the Class A Notes (i.e., via the Class A Principal Adjustment Amount) and to
increase the collateral coverage for each Class of Notes. Reductions in
appraised values cannot affect interest payments to be made on Class A, B, C
and D Notes but can cause the suspension interest payments on the Class E
Notes.
The Company has obtained desktop appraisals of the "base value" of each of the
Company's 229 aircraft from three independent aircraft value appraisers;
Airclaims Limited ("Airclaims"), Aircraft Information Services, Inc. ("AISI")
and BK Associates, Inc. ("BK"). On the basis of these three appraisals, as of
February 25, 1997, the average appraised base value of the Company's portfolio
of aircraft was approximately $4,207 million (the "1997 Appraised Value")
compared with $4,527 million as of October 31, 1995. Airclaims' 1997
appraised base value was $3,975 million, AISI's was $4,446 million and BK's
was $4,279 million.
The decrease represented by the average appraised value of the portfolio at
February 25, 1997 compared with the average appraised value at October 31, 1995
is approximately $155 million more than the expected decrease implied by the
terms of the Airplanes Notes. Greater than expected decreases in value
occurred across the Company's fleet of aircraft, with significant percentage
decreases being experienced by the Company's older wide-body aircraft (A300s
and DC10-30s), the Company's F100s and, to a lesser extent, the Company's
MD80s and B737-
500s.
However, the Company's strong operating performance to date has allowed
cashflow to exceed March 1996 expectations resulting in greater than expected
amortization of the Company's Class A notes. The outstanding principal balance
of the Company's Class A notes at February 18, 1997 was approximately $2,704
million compared with the $2,727 million that was assumed would be outstanding
at that time. Accordingly, given the Target Principal Balance implied by the
1997 Appraised Value, Principal Adjustment Amounts of approximately $39
million in aggregate will be required to be paid from available cash flow and
applied to reduce the outstanding principal balance of the Company's Subclass
A-5 Notes. Until the required Principal Adjustment Amount payments have been
made, there will be no further payments of interest on the Company's Class E
Notes and no payments in respect of conversions or modifications of aircraft
nor any other payments ranking more junior than Principal Adjustment Amounts
in the priority of payments set forth in the indentures that govern the Notes.
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, commencing with 1997, 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
25, 1997 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
period of 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 11 aircraft subject to finance
leases have been included at their net book value rather than appraised value.
The 1997 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 25, 1997
For further information please contact: Patrick Blaney at tel + 353 61 360000
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 25, 1997 /s/ Roy M. Dantzic*
--------------------
Director and Officer
Date: February 25, 1997 AIRPLANES U.S. TRUST
/s/ Roy M . Dantzic*
--------------------
Controlling Trustee
and Officer
*By: /s/ Michael Walsh
-----------------
Attorney-in-Fact
EXHIBIT INDEX
Exhibit A - Power of Attorney for Airplanes Limited
Exhibit B - Power of Attorney for Airplanes U.S. Trust