1
EXHIBIT 1
MSAF'S PORTFOLIO
THE ACQUISITIONS
On May 19, 1999, an indirect wholly owned subsidiary of MSDW acquired two
aircraft from an affiliate of GE Capital Corporation. On August 6, 1999, another
indirect wholly owned subsidiary of MSDW agreed to acquire 27 aircraft from
ILFC. All but one of these aircraft have been delivered by ILFC. The remaining
aircraft is due to be delivered on or before April 30, 2000. If it is not
delivered, a substitute aircraft may be acquired if certain conditions are met.
The discussion of the portfolio in this Exhibit 1 assumes that MSAF group takes
delivery of the one remaining aircraft. Upon consummation of this offering, we
will acquire these new aircraft-owning subsidiaries and as a result will own the
29 aircraft. The 29 additional aircraft had an aggregate appraised value of
$1,047.8 million as of November 30, 1999. As of February 1, 2000, all of these
aircraft were subject to lease contracts with 24 lessees based in 16 countries.
The following table sets forth certain information as of February 15, 2000
with respect to the 29 additional aircraft (except for appraised values which
are as of November 30, 1999). For more information regarding each lessee, you
should refer to "-- Description of the Lessees" below.
APPRAISED VALUE
ENGINE SERIAL DATE OF AS OF NOVEMBER 30,
TYPE CONFIGURATION NUMBER MANUFACTURE LESSEE 1999
- ---- --------------- ------ ----------- ------ ------------------
($MM)
A300-600R PW 4158 625 Mar-92 China Airlines 51.1
A320-200 CFM 56-5A3 397 Mar-93 Canada 3000 30.8
A320-200 V2500-A1 428 May-94 TransAer 32.1
A320-200 CFM 56-5A3 446 Oct-93 Monarch 30.5
A321-100 V2530-A5 557 Dec-95 Air Macau 38.9
A330-300 CF6-80E1 54 Apr-94 Aer Lingus 80.0
A340-300 CFM 56-5C3G 94 Mar-95 Air Mauritius 91.6
B737-300 CFM 56-3B1 23255 Jun-85 Southwest 14.4
B737-300 CFM 56-3B1 23256 Jul-85 Southwest 15.3
B737-300 CFM 56-3B2 24449 Apr-90 Lithuanian 21.7(1)
B737-300 CFM 56-3B1 26309 Dec-94 Continental 26.3
B737-400 CFM 56-3C1 24707 Jun-91 Air Europa 24.7
B737-400 CFM 56-3C1 25105 Jul-93 Alaska Airlines 26.6
B737-400 CFM 56-3C1 26279 Jun-92 Pegasus 25.7
B737-400 CFM 56-3C1 26291 Aug-93 Asiana 27.6
B737-400 CFM 56-3C1 26308 Oct-94 Asiana 27.9
B737-500 CFM 56-3C1 26304 Sep-94 Braathens 21.2
B747-400 RB211-252H2/19 24955 Sep-91 Cathay Pacific 97.4
B757-200ER RB211-535-E4 23767 Apr-87 Air 2000 29.7
B757-200ER PW 2040 24965 Mar-92 Mexicana 39.1
B757-200ER PW 2037 25044 May-91 F.E.A.T. 37.5
B757-200ER RB211-535-E4-37 26266 Feb-93 Britannia 41.2
B757-200ER PW 2037 28160 Jul-96 TWA 47.8
B767-300ER CF6-80C2B6 24875 Jun-91 Air New Zealand 57.0
B767-300ER CF6-80C2B6F 25132 Feb-92 Asiana 60.1
F-50 PW100-125B 20232 Oct-91 KLM CityHopper 6.3
F-50 PW100-125B 20233 Oct-91 KLM CityHopper 6.2
MD-83 JT8D-219 49657 Apr-88 TWA 19.6
MD-83 JT8D-219 53050 May-90 Aeromexico 19.7
------------------
Total $1,047.8
==================
- ---------------
(1) Aircraft that has not been delivered.
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APPRAISALS
As of November 30, 1999, our portfolio had an aggregate appraised value of
$2,000.9 million. Under our indenture, we are required, at least once each year
and in any case no later than October 31 of each year, to deliver to the trustee
appraisals of the base value of each of the aircraft in our portfolio from at
least three independent appraisers that are members of the International Society
of Transport Aircraft Trading or any similar organization. We have obtained
appraisals from five such appraisers. We have calculated the appraised value of
each aircraft by removing the highest and the lowest appraisal and taking the
average of the remaining three.
Our five appraisers, Aircraft Information Services, Inc., BK Associates,
Inc., Airclaims Limited, Morten Beyer and Agnew and Aircraft Value Analysis
Company have provided appraisals of the value of each of our aircraft at normal
utilization rates in an open, unrestricted and stable market, without taking
into account the value of related leases, maintenance reserves or security
deposits as of November 30, 1999, adjusted to account for the reported
maintenance standard of the aircraft. The appraisals were not based on a
physical inspection of the aircraft.
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The appraisals for the portfolio as of November 30, 1999 are set out below.
APPRAISAL OF
--------------------------------------------------------------
AIRCRAFT
ENGINE SERIAL DATE OF AIRCLAIMS BK INFORMATION MORTON BEYER
AIRCRAFT TYPE CONFIGURATION NUMBER MANUFACTURE LIMITED ASSOCIATES SERVICES AND AGNEW
- ------------- --------------- ------ ----------- ---------- ----------- -------------------- ------------
A300-600R PW 4158 555 Mar-90 43,820,038 46,874,794 50,860,000 48,210,000
A300-600R PW 4158 625 Mar-92 45,598,979 53,107,233 56,000,000 53,220,000
A310-300 JT9D-7R4E1 409 Nov-85 18,668,131 27,022,136 21,300,000 29,499,000
A310-300 JT9D-7R4E1 410 Nov-85 18,736,079 27,403,582 21,820,000 30,501,000
A310-300 JT9D-7R4E1 437 Nov-86 21,316,952 33,262,341 27,820,000 33,419,000
A320-200 CFM 56-5A3 279 Feb-92 28,871,688 31,244,598 28,640,000 31,652,000
A320-200 V2500-A1 393 Feb-93 29,931,935 31,187,247 29,090,000 33,098,000
A320-200 CFM 56-5A3 397 Mar-93 30,162,691 31,894,773 30,400,000 33,319,000
A320-200 V2500-A1 414 May-93 30,336,415 30,957,449 29,130,000 33,363,000
A320-200 V2500-A1 428 May-94 31,669,836 32,628,258 30,790,000 33,834,000
A320-200 CFM 56-5A3 446 Oct-93 30,177,866 31,100,000 30,030,000 35,176,000
A321-100 V2530-A5 557 Dec-95 35,247,421 45,988,568 39,160,000 37,638,000
A321-100 V2530-A5 597 May-96 36,085,390 45,156,750 41,930,000 37,567,000
A330-300 CF6-80E1 54 Apr-94 75,194,550 81,864,707 82,310,000 87,754,000
A340-300 CFM 56-5C3G 94 Mar-95 81,144,912 92,319,102 105,920,000 97,684,000
B737-300 CFM 56-3B1 23255 Jun-85 14,620,625 13,547,506 17,440,000 14,837,000
B737-300 CFM 56-3B1 23256 Jul-85 16,395,719 14,501,668 18,040,000 14,961,000
B737-300 CFM 56-3B2 24299 Nov-88 20,001,225 18,790,300 20,570,000 19,140,000
B737-300 CFM 56-3B2 24449 Apr-90 21,065,000 21,990,000 22,930,000 20,575,000
B737-300 CFM 56-3B2 25161 Feb-92 22,674,379 25,511,536 25,010,000 23,784,000
B737-300 CFM 56-3C1 26295 Dec-93 22,596,442 26,024,250 25,560,000 25,546,000
B737-300 CFM 56-3B1 26309 Dec-94 24,232,196 27,700,000 26,050,000 26,602,000
B737-300 CFM 56-3C1 27635 May-95 25,561,933 28,728,600 28,540,000 27,137,000
B737-300F CFM 56-3B2 23811 Oct-87 19,378,488 19,003,082 21,560,000 19,936,000
B737-300QC CFM 56-3C1 23788 May-87 19,405,573 18,099,500 21,780,000 19,782,000
B737-400 CFM 56-3B2 24234 Oct-88 21,619,354 20,194,364 22,780,000 22,435,000
B737-400 CFM 56-3C1 24707 Jun-91 22,800,670 24,963,604 25,310,000 24,644,000
B737-400 CFM 56-3C1 25104 May-93 25,507,457 26,531,550 27,350,000 27,541,000
B737-400 CFM 56-3C1 25105 Jul-93 24,598,379 26,073,250 27,240,000 27,262,000
B737-400 CFM 56-3C1 25371 Jan-92 24,688,071 24,170,810 26,430,000 25,300,000
B737-400 CFM 56-3C1 26279 Jun-92 24,351,332 24,619,226 26,350,000 26,702,000
B737-400 CFM 56-3C1 26291 Aug-93 25,950,885 26,756,516 27,690,000 28,584,000
B737-400 CFM 56-3C1 26308 Oct-94 25,817,981 28,264,060 28,600,000 29,154,000
B737-500 CFM 56-3B1 25165 Apr-93 20,559,624 17,552,500 19,980,000 20,762,000
B737-500 CFM 56-3C1 26304 Sep-94 20,516,576 20,060,150 22,360,000 23,311,000
B747-300B CF6-80C2 24106 Apr-88 46,632,687 59,943,960 48,480,000 51,991,000
B747-400 RB211-252H2/19 24955 Sep-91 82,013,762 106,527,824 105,760,000 104,476,000
B757-200ER RB211-535-E4 23767 Apr-87 28,008,616 29,791,024 32,830,000 31,259,000
B757-200ER RB211-535-E4 24260 Dec-88 30,423,476 33,021,212 35,580,000 35,424,000
B757-200ER RB211-535-E4-37 24367 Feb-89 28,943,600 31,335,359 36,050,000 33,392,000
B757-200ER PW 2040 24965 Mar-92 34,411,426 39,971,145 42,970,000 41,106,000
B757-200ER PW 2037 25044 May-91 33,135,259 39,209,345 40,720,000 39,271,000
B757-200ER RB211-535-E4-37 26266 Feb-93 35,464,262 41,872,550 44,580,000 42,305,000
B757-200ER PW 2037 26272 Mar-94 33,003,740 42,932,416 44,160,000 42,618,000
B757-200ER PW 2037 28160 Jul-96 37,843,699 49,445,918 49,160,000 50,344,000
B767-200ER CF6-80A 23807 Aug-87 28,838,628 31,079,940 35,160,000 28,539,000
B767-300ER CF6-80C2B6F 24798 Oct-90 49,099,299 53,667,285 56,670,000 57,665,000
B767-300ER CF6-80C2B6 24875 Jun-91 54,444,607 55,072,637 60,730,000 59,425,000
B767-300ER CF6-80C2B6F 25132 Feb-92 56,498,903 59,356,214 65,170,000 62,469,000
B767-300ER CF6-80C2B6F 26256 Apr-93 59,887,960 61,960,315 67,990,000 67,204,000
B767-300ER CF6-80C2B4 26260 Sep-94 60,046,996 64,745,045 68,760,000 68,534,000
engine CF6-80C2B6F 704279 Jul-95 5,951,393 6,282,000 5,710,000 4,506,000
F-50 PW100-125B 20232 Oct-91 6,141,563 7,340,076 6,080,000 5,355,000
F-50 PW100-125B 20233 Oct-91 6,141,563 7,304,406 6,010,000 5,366,000
F-70 TAY MK620-15 11564 Dec-95 11,880,010 14,100,000 13,410,000 14,331,000
F-70 TAY MK620-15 11565 Feb-96 11,087,025 15,200,000 14,910,000 14,430,000
F-70 TAY MK620-15 11569 Mar-96 11,359,096 15,200,000 14,910,000 14,478,000
MD-82 JT8D-217C 49825 Mar-89 15,323,107 17,318,790 20,750,000 19,528,000
MD-83 JT8D-219 49657 Apr-88 16,505,672 20,090,575 20,780,000 20,543,000
MD-83 JT8D-219 49822 Dec-88 16,903,329 18,823,975 20,080,000 21,431,000
MD-83 JT8D-219 49824 Mar-89 17,375,556 21,362,625 21,660,000 22,143,000
MD-83 JT8D-219 53050 May-90 17,016,260 21,120,000 21,360,000 21,078,000
APPRAISAL OF
--------------
AIRCRAFT VALUE APPRAISED
ANALYSIS VALUE AS OF
AIRCRAFT TYPE COMPANY NOVEMBER 30, 1999
- ------------- -------------- -----------------
A300-600R 39,050,000 46,301,611
A300-600R 46,850,000 51,059,078
A310-300 15,200,000 22,330,089
A310-300 15,550,000 22,653,220
A310-300 21,800,000 27,627,447
A320-200 29,500,000 29,872,095
A320-200 30,170,000 30,429,727
A320-200 30,075,000 30,819,155
A320-200 30,450,000 30,581,288
A320-200 32,100,000 32,132,698
A320-200 30,225,000 30,500,955
A321-100 40,000,000 38,932,667
A321-100 39,600,000 39,699,000
A330-300 75,750,000 79,974,902
A340-300 84,650,000 91,551,034
B737-300 13,675,000 14,377,542
B737-300 14,200,000 15,286,129
B737-300 20,400,000 19,847,075
B737-300 22,050,000 21,701,667(1)
B737-300 24,900,000 24,564,667
B737-300 25,300,000 25,468,667
B737-300 26,300,000 26,317,333
B737-300 26,200,000 27,292,333
B737-300F 20,100,000 19,804,829
B737-300QC 18,450,000 19,212,524
B737-400 21,600,000 21,884,785
B737-400 24,400,000 24,669,201
B737-400 25,800,000 26,560,517
B737-400 26,400,000 26,571,083
B737-400 25,450,000 25,146,024
B737-400 26,100,000 25,689,742
B737-400 28,500,000 27,648,839
B737-400 26,850,000 27,904,687
B737-500 18,600,000 19,713,208
B737-500 20,600,000 21,158,859
B747-300B 39,870,000 49,034,562
B747-400 79,900,000 97,416,587
B757-200ER 26,800,000 29,686,213
B757-200ER 32,000,000 33,481,737
B757-200ER 30,300,000 31,675,786
B757-200ER 36,300,000 39,125,715
B757-200ER 34,025,000 37,501,782
B757-200ER 39,305,000 41,160,850
B757-200ER 38,750,000 41,433,472
B757-200ER 44,750,000 47,785,306
B767-200ER 25,650,000 29,485,856
B767-300ER 48,700,000 53,145,528(2)
B767-300ER 56,380,000 56,959,212
B767-300ER 58,600,000 60,141,738
B767-300ER 62,300,000 63,621,438
B767-300ER 66,400,000 66,559,682
engine 4,850,000 5,503,798
F-50 6,550,000 6,257,188
F-50 6,330,000 6,160,521
F-70 13,450,000 13,653,333
F-70 13,650,000 14,330,000
F-70 14,650,000 14,679,333
MD-82 16,500,000 17,782,263
MD-83 18,200,000 19,611,192
MD-83 18,400,000 19,101,325
MD-83 18,100,000 20,374,208
MD-83 17,000,000 19,738,087
--------------
Total $2,000,891,389
==============
E-1-3
4
- ---------------
(1) Aircraft that has not been delivered.
(2) This aircraft is not currently capable of extended range missions but ILFC
has agreed to pay for the cost of an extended range modification to the
aircraft upon MSAF's request at any time following the termination or
expiration of the lease for the aircraft. The appraisals of the aircraft
assume that the extended range modification has been carried out.
The aggregate values calculated by each of the five appraisers for the
portfolio are as follows:
AGGREGATE
APPRAISED VALUE
AS OF NOVEMBER 30,
APPRAISER 1999
--------- ------------------
($MM)
Airclaims Limited........................................... 1,833.7
Aircraft Information Services, Inc.......................... 2,107.2
Aircraft Value Analysis Company............................. 1,884.6
BK Associates, Inc.......................................... 2,059.2
Morten Beyer and Agnew...................................... 2,103.1
The following table sets forth certain selected statistics relating to the
appraisals of the portfolio at November 30, 1999.
STATISTICAL SUMMARY ($MM)
------------------- -------
Average aggregate of 3 appraisals with highest and lowest
removed................................................... 2,000.9
Average aggregate of all 5 appraisals....................... 1,997.5
Median aggregate of 3 appraisals with highest and lowest
removed................................................... 2,014.7
Median aggregate of all 5 appraisals........................ 2,014.7
Difference between highest and lowest aggregate appraisal... 273.5
Difference between highest and lowest aggregate appraisal as
a percentage of the average aggregate of 3 appraisals with
the highest and lowest removed............................ 13.7%
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5
PORTFOLIO INFORMATION
All of the jet aircraft hold or are capable of holding a noise certificate
issued under Chapter 3 of Volume 1, Part II of Annex 16 of the Chicago
Convention or have been shown to comply with the Stage 3 noise levels set out in
Section 36.5 of Appendix C of Part 36 of the United States Federal Aviation
Regulations.
The following table sets forth the exposure as of February 15, 2000 of our
portfolio by type of aircraft calculated by reference to the number of aircraft
and their appraised value as of November 30, 1999.
% OF PORTFOLIO BY
APPRAISED VALUE
NUMBER OF ENGINE AS OF NOVEMBER 30,
MANUFACTURER TYPE OF AIRCRAFT AIRCRAFT BODY TYPE STAGE 1999
- ------------ ---------------- ----------- --------- ------ ------------------
Airbus (30.21%).............. A300-600R 2 Widebody 3 4.86%
A310-300 3 Widebody 3 3.63%
A320-200 6 Narrowbody 3 9.21%
A321-100 2 Narrowbody 3 3.93%
A330-300 1 Widebody 3 4.00%
A340-300 1 Widebody 3 4.58%
Boeing (66.76%).............. B737-300 9 Narrowbody 3 9.69%(1)
B737-300F 1 Freighter 3 0.99%
B737-400 8 Narrowbody 3 10.29%
B737-500 2 Narrowbody 3 2.05%
B747-300B 1 Widebody 3 2.45%
B747-400 1 Widebody 3 4.87%
B757-200ER 8 Narrowbody 3 15.08%
B767-200ER 1 Widebody 3 1.47%
B767-300ER 5 Widebody 3 15.04%
MD-82 1 Narrowbody 3 0.89%
MD-83 4 Narrowbody 3 3.94%
Fokker N.V.(2.75%)........... F-50 2 Turboprop 3 0.62%
F-70 3 Narrowbody 3 2.13%
General Electric (0.28%)..... Engine engine n/a 3 0.28%
----------- -------
Total...................... 61 + engine 100.00%
=========== =======
- ---------------
(1) Includes aircraft that has not been delivered.
E-1-5
6
The following table sets forth the exposure as of February 15, 2000 of our
portfolio to the lessees calculated by reference to the appraised value of the
aircraft as of November 30, 1999.
% OF PORTFOLIO BY
APPRAISED VALUE
NUMBER OF AS OF NOVEMBER 30,
LESSEE AIRCRAFT 1999
- ------ ----------- ------------------
Asiana Airlines, Inc........................................ 4 8.44%
Trans World Airlines Inc. (TWA)............................. 4 5.28%
Cathay Pacific Airways Limited.............................. 1 4.87%
China Airlines, Limited..................................... 2 4.86%
Air 2000 Limited............................................ 2 4.67%
Air Mauritius LTD........................................... 1 4.58%
Aer Lingus, PLC............................................. 1 4.00%
Britannia Airways Ltd....................................... 2 3.53%
Air Pacific Limited......................................... 1 3.33%
Translift Airways Ltd. (TRANSAER)........................... 2 3.14%
Flying Colours Airlines Limited............................. 2 3.10%
Aerovias De Mexico, S.A. De C.V. (AEROMEXICO)............... 2 3.06%
New Zealand International Airlines Limited (AIR NEW
ZEALAND).................................................. 1 2.85%
Alaska Airlines Inc......................................... 2 2.66%
Flugfelagid Atlanta H.F. (AIR ATLANTA ICELANDIC)............ 1 2.45%
Region Air (BVI) Ltd........................................ 2 2.25%
Malev Hungarian Airlines, PLC............................... 3 2.13%
Braathens ASA............................................... 2 2.05%
Air Alfa Airlines, S.A...................................... 1 1.98%
Compania Mexicana de Aviacion, S.A. De C.V. (MEXICANA)...... 1 1.96%
Companhia de Transportes Aereos Air Macau, Sarl (AIR
MACAU).................................................... 1 1.95%
Far Eastern Air Transport Corporation (F.E.A.T.)............ 1 1.87%
National Airlines........................................... 1 1.67%
Canada 3000 Airlines........................................ 1 1.54%
Monarch Airlines Limited.................................... 1 1.52%
Canadian Airlines International Ltd......................... 1 1.49%
Southwest Airlines Co....................................... 2 1.48%
B.R.A. Transportes Aereos Ltda. (B.R.A.).................... 1 1.38%
Transavia Airlines.......................................... 1 1.36%
Continental Airlines Inc.................................... 1 1.32%
Pegasus Hava Tasimaciligi, A.S.............................. 1 1.28%
China Hainan Airlines....................................... 1 1.27%
Olympic Airways............................................. 1 1.26%
Air Malta................................................... 1 1.23%
Air Espana S.A. (AIR EUROPA)................................ 1 1.23%
Lithuanian Airlines......................................... 1 1.08%(1)
Viacao Aerea Sao Paulo, S.A. Brazilian Airlines (VASP)...... 1 0.99%
Flugleidir H.F. (ICELANDAIR)................................ 1 0.99%
Societe D'Exploitation Aeropostale S.A. (L'AEROPOSTALE)..... 1 0.96%
Air Liberte, S.A............................................ 1 0.95%
KLM Cityhopper B.V.......................................... 2 0.62%
Koninklyke Luchtvaart Maatschappij N.V. (KLM)............... engine 0.28%
Off-lease................................................... 1 1.09%(2)
----------- -------
Total..................................................... 61 + engine 100.00%
=========== =======
- ---------------
(1) Aircraft that has not been delivered.
(2) This aircraft is currently the subject of a non-binding letter of intent for
lease with a carrier based in the Middle East.
E-1-6
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The following table sets forth the exposure as of February 15, 2000 of our
portfolio to countries in which the lessees are based calculated by reference to
the appraised value of the aircraft as of November 30, 1999.
% OF PORTFOLIO BY
APPRAISED VALUE
NUMBER OF AS OF NOVEMBER 30,
COUNTRY AIRCRAFT 1999
- ------- ----------- ------------------
United Kingdom.............................................. 7 12.82%
United States of America.................................... 10 12.41%
South Korea................................................. 4 8.44%
Ireland..................................................... 3 7.14%
Taiwan...................................................... 3 6.73%
Mexico...................................................... 3 5.02%
Hong Kong................................................... 1 4.87%
Mauritius................................................... 1 4.58%
Iceland..................................................... 2 3.44%
Fiji........................................................ 1 3.33%
Turkey...................................................... 2 3.26%
Canada...................................................... 2 3.03%
New Zealand................................................. 1 2.85%
Brazil...................................................... 2 2.37%
The Netherlands............................................. 3 + engine 2.26%
Singapore................................................... 2 2.25%
Hungary..................................................... 3 2.13%
Norway...................................................... 2 2.05%
Macau....................................................... 1 1.95%
France...................................................... 2 1.91%
China....................................................... 1 1.27%
Greece...................................................... 1 1.26%
Malta....................................................... 1 1.23%
Spain....................................................... 1 1.23%
Lithuania................................................... 1 1.08%(1)
Off-lease................................................... 1 1.09%(2)
----------- -------
Total..................................................... 61 + engine 100.00%
=========== =======
- ---------------
(1) Aircraft that has not been delivered.
(2) This aircraft is currently the subject of a non-binding letter of intent
for lease with a carrier based in the Middle East.
The following table sets forth the exposure as of February 15, 2000 of our
portfolio by regions in which the lessees are domiciled calculated by reference
to number of aircraft and their appraised value as of November 30, 1999.
% OF PORTFOLIO BY
APPRAISED VALUE
NUMBER OF AS OF NOVEMBER 30,
REGION(1) AIRCRAFT 1999
- --------- ----------- ------------------
Developed
Europe.................................................... 18 + engine 27.41%
North America............................................. 12 15.44%
Pacific................................................... 4 9.97%
Emerging
Asia...................................................... 8 16.44%
Latin America............................................. 5 7.39%
Europe and Middle East.................................... 6 6.65%
Other
Other..................................................... 7 5.61%(2)
Off-lease................................................. 1 1.09%(3)
----------- -------
Total.................................................. 61 +
engine..... 100.00%
=========== =======
- ---------------
(1) Regions are defined according to designations published by Morgan Stanley
Capital International.
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(2) Includes aircraft that has not been delivered.
(3) This aircraft is currently the subject of a non-binding letter of intent
for lease with a carrier based in the Middle East.
The following table sets forth the exposure as of February 15, 2000 of our
portfolio by year of aircraft manufacture calculated by reference to the
appraised value of the aircraft as of November 30, 1999. The weighted average
age of the fleet as of February 1, 2000 was approximately 8.1 years.
% OF PORTFOLIO BY
APPRAISED VALUE
NUMBER OF AS OF NOVEMBER 30,
YEAR OF MANUFACTURE AIRCRAFT 1999
- ------------------- ----------- ------------------
1985........................................................ 4 3.73%
1986........................................................ 1 1.38%
1987........................................................ 4 4.90%
1988........................................................ 6 8.13%
1989........................................................ 3 3.49%
1990........................................................ 4 7.04%(1)
1991........................................................ 6 11.44%
1992........................................................ 7 12.78%
1993........................................................ 11 17.66%
1994........................................................ 7 14.78%
1995........................................................ 4 + engine 8.85%
1996........................................................ 4 5.82%
----------- -------
Total..................................................... 61 + engine 100.00%
=========== =======
- ---------------
(1) Includes aircraft that has not been delivered.
The following table sets forth the exposure as of February 1, 2000 of our
portfolio by seat category calculated by reference to the appraised value of our
aircraft as of November 30, 1999.
% OF PORTFOLIO BY
APPRAISED VALUE
NUMBER OF AS OF NOVEMBER 30,
SEAT CATEGORY AIRCRAFT 1999
------------- ----------- ------------------
<50................ F-50......................................... 2 0.62%
51-120............. B737-500, F-70............................... 5 4.18%
121-170............ A320-200, B737-300, B737-400, MD-82, MD-83... 28 34.02%(1)
171-240............ A321-100, B757-200ER......................... 10 19.01%
241-350............ A310-300, A330-300, B767-200ER, B767-300ER... 10 24.14%
351+............... A300-600R, A340-300, B747-300B, B747-400..... 5 16.76%
Other.............. B737-300F (freighter), Engine................ 1 + engine 1.27%
----------- -------
Total........................................................... 61 + engine 100.00%
=========== =======
- ---------------
(1) Includes aircraft that has not been delivered.
E-1-8
9
MSAF GROUP PORTFOLIO ANALYSIS
The following table sets forth additional information on our portfolio as
of February 1, 2000 (except for appraised values, which are as of November 30,
1999).
ENGINE SERIAL DATE OF
REGION(1) COUNTRY OF LESSEE LESSEE TYPE CONFIGURATION NUMBER MANUFACTURE
- --------- ----------------- ------ ---- ------------- ------ -----------
Europe................... France Air Liberte MD-83 JT8D-219 49822 Dec-88
(Developed) France L'Aeropostale B737-300QC CFM 56-3C1 23788 May-87
Ireland Aer Lingus A330-300 CF6-80E1 54 Apr-94
Ireland TransAer A320-200 V2500-A1 414 May-93
Ireland TransAer A320-200 V2500-A1 428 May-94
The Netherlands KLM Engine CF6-80C2B6F 704279 Jul-95
The Netherlands KLM Cityhopper F50 PW100-125B 20232 Oct-91
The Netherlands KLM Cityhopper F50 PW100-125B 20233 Oct-91
The Netherlands Transavia B737-300 CFM 56-3C1 27635 May-95
Norway Braathens B737-500 CFM 56-3B1 25165 Apr-93
Norway Braathens B737-500 CFM 56-3C1 26304 Sep-94
Spain Air Europa B737-400 CFM 56-3C1 24707 Jun-91
United Kingdom Air 2000 B757-200ER RB211-535-E4 23767 Apr-87
United Kingdom Air 2000 B767-300ER CF6-80C2B6F 26256 Apr-93
United Kingdom Britannia B767-200ER CF6-80A 23807 Aug-87
United Kingdom Britannia B757-200ER RB211-535-E4-37 26266 Feb-93
United Kingdom Flying Colours A320-200 V2500-A1 393 Feb-93
United Kingdom Flying Colours B757-200ER RB211-535-E4-37 24367 Feb-89
United Kingdom Monarch A320-200 CFM 56-5A3 446 Oct-93
North America............ Canada Canada 3000 A320-200 CFM 56-5A3 397 Mar-93
(Developed) Canada Canadian A320-200 CFM 56-5A3 279 Feb-92
United States of America Alaska Airlines B737-400 CFM 56-3C1 25104 May-93
United States of America Alaska Airlines B737-400 CFM 56-3C1 25105 Jul-93
United States of America Continental B737-300 CFM 56-3B1 26309 Dec-94
United States of America National B757-200ER RB211-535-E4 24260 Dec-88
Airlines
United States of America Southwest B737-300 CFM 56-3B1 23255 Jun-85
United States of America Southwest B737-300 CFM 56-3B1 23256 Jul-85
United States of America TWA B757-200ER PW 2037 28160 Jul-96
United States of America TWA MD-83 JT8D-219 49824 Mar-89
United States of America TWA MD-82 JT8D-217C 49825 Mar-89
United States of America TWA MD-83 JT8D-219 49657 Apr-88
Pacific.................. Hong Kong Cathay Pacific B747-400 RB211-252H2/19 24955 Sep-91
(Developed) New Zealand Air New Zealand B767-300ER CF6-80C2B6 24875 Jun-91
Singapore Region AA A310-300 JT9D-7R4E1 409 Nov-85
Singapore Region AA A310-300 JT9D-7R4E1 410 Nov-85
Europe and Middle East... Greece Olympic B737-400 CFM 56-3C1 25371 Jan-92
(Emerging) Hungary Malev F70 TAY MK620-15 11564 Dec-95
Hungary Malev F70 TAY MK620-15 11565 Feb-96
Hungary Malev F70 TAY MK620-15 11569 Mar-96
Turkey Air Alfa A321-100 V2530-A5 597 May-96
Turkey Pegasus B737-400 CFM 56-3C1 26279 Jun-92
Asia..................... China China Hainan B737-300 CFM 56-3C1 26295 Dec-93
(Emerging) South Korea Asiana B767-300ER CF6-80C2B6F 24798 Oct-90
South Korea Asiana B767-300ER CF6-80C2B6F 25132 Feb-92
South Korea Asiana B737-400 CFM 56-3C1 26291 Aug-93
South Korea Asiana B737-400 CFM 56-3C1 26308 Oct-94
Taiwan China Airlines A300-600R PW 4158 555 Mar-90
Taiwan China Airlines A300-600R PW 4158 625 Mar-92
Taiwan F.E.A.T. B757-200ER PW 2037 25044 May-91
Latin America............ Brazil B.R.A. A310-300 JT9D-7R4E1 437 Nov-86
(Emerging) Brazil VASP B737-300 CFM 56-3B2 24299 Nov-88
Mexico Aeromexico B757-200ER PW 2037 26272 Mar-94
Mexico Aeromexico MD-83 JT8D-219 53050 May-90
Mexico Mexicana B757-200ER PW 2040 24965 Mar-92
Other.................... Fiji Air Pacific B767-300ER CF6-80C2B4 26260 Sep-94
Iceland Icelandair B737-300 CFM 56-3B2 23811 Sep-87
Iceland Air Atlantic
Icelandic B747-300 CF6-80C2 24106 Apr-88
Lithuania Lithuanian B737-300 CFM 56-3B2 24449 Apr-90
Macau Air Macau A321-100 V2530-A5 557 Dec-95
Malta Air Malta B737-300 CFM 56-3B2 25161 Feb-92
Mauritius Air Mauritius A340-300 CFM 56-5C3G 94 Mar-95
Off-lease................ -- -- B737-400 CFM 56-3B2 24234 Oct-88
Total
% OF PORTFOLIO
APPRAISED BY APPRAISED
VALUE AS OF VALUE AS OF
NOVEMBER 30, NOVEMBER 30,
REGION(1) 1999 1999
- --------- ------------ --------------
($MM)
Europe................... 19.1 0.95%
(Developed) 19.2 0.96%
80.0 4.00%
30.6 1.53%
32.1 1.61%
5.5 0.28%
6.3 0.31%
6.2 0.31%
27.3 1.36%
19.7 0.99%
21.2 1.06%
24.7 1.23%
29.7 1.48%
63.8 3.19%
29.5 1.47%
41.2 2.06%
30.4 1.52%
31.7 1.58%
30.5 1.52%
North America............ 30.8 1.54%
(Developed) 29.9 1.49%
26.6 1.33%
26.6 1.33%
26.3 1.32%
33.5 1.67%
14.4 0.72%
15.3 0.76%
47.8 2.39%
20.4 1.02%
17.8 0.89%
19.6 0.98%
Pacific.................. 97.4 4.87%
(Developed) 57.0 2.85%
22.3 1.12%
22.7 1.13%
Europe and Middle East... 25.1 1.26%
(Emerging) 13.7 0.68%
14.3 0.72%
14.7 0.73%
39.7 1.98%
25.7 1.28%
Asia..................... 25.5 1.27%
(Emerging) 53.1 2.66%
60.1 3.01%
27.6 1.38%
27.9 1.39%
46.3 2.31%
51.1 2.55%
37.5 1.87%
Latin America............ 27.6 1.38%
(Emerging) 19.8 0.99%
41.4 2.07%
19.7 0.99%
39.1 1.96%
Other.................... 66.6 3.33%
19.8 0.99%
49.0 2.45%
21.7 1.08%(2)
38.9 1.95%
24.6 1.23%
91.6 4.58%
Off-lease................ 21.9 1.09%(3)
-------
2,000.9
=======
- ---------------
(1) Regions are defined according to designations published by Morgan Stanley
Capital International.
(2) Aircraft that has not been delivered.
(3) This aircraft is currently the subject of a non-binding letter of intent for
lease with a carrier based in the Middle East.
E-1-9
10
DESCRIPTION OF THE AIRCRAFT
The table below sets forth certain available information with respect to
the body type, number of seats, configuration, engine manufacturer, production
years, number of aircraft delivered, current fleet, number of aircraft on order
and number of operators of each aircraft type in our portfolio as of February
15, 2000.
ENGINE CURRENT ON NUMBER OF
TYPE & VARIANT BODY SEATS MANUFACTURER(1) PRODUCTION YEARS FLEET ORDER OPERATORS(2)
- -------------- --------- ----- --------------- ------------------ ------- ----- ------------
Airbus A300-600R........................ Wide 220 2 X GE 1987- 77 0 13
2 X PW 1988- 85 31 9
Airbus A310-300......................... Wide 180 2 X GE 1985- 82 0 21
2 X PW 1985- 66 5 21
Airbus A320-200......................... Narrow 150 2 X CFM 1988- 470 209 48
2 X IAE 1988- 306 188 50
2 X TBA 0 100 0
Airbus A321-100......................... Narrow 185 2 X CFM 1993- 42 5 4
2 X IAE 1993- 41 13 9
Airbus A330-300......................... Wide 295 2 X GE 1993- 16 10 4
2 X PW 1994- 37 36 9
2 X RR 1992- 27 14 6
2 X TBA 0 4 1
Airbus A340-300......................... Wide 295 4 X CFM 1992- 144 53 25
Boeing 737-300.......................... Narrow 130 2 X CFM 1984- 1067 0 96
Boeing 737-300F......................... Freight 0 2 X CFM (all conversions) 3 0 3
Boeing 737-300QC........................ Narrow 130 2 X CFM (all conversions) 29 0 6
Boeing 737-400.......................... Narrow 150 2 X CFM 1988- 477 1 70
Boeing 737-500.......................... Narrow 110 2 X CFM 1989- 384 0 39
Boeing 747-300.......................... Wide 400 4 X GE 1982-1990 16 0 6
4 X PW 1982-1988 40 0 12
4 X RR 1984-1988 22 0 4
Boeing 747-400.......................... Wide 412 4 X GE 1988- 211 49 26
4 X PW 1988- 183 21 12
4 X RR 1988- 113 4 6
TBA 0 1 0
Boeing 757-200.......................... Narrow 200 2 X PW 1984- 380 41 17
2 X RR 1982- 501 12 42
2 X TBA 0 16 0
Boeing 767-200ER........................ Wide 180 2 X GE 1985- 58 10 13
2 X PW 1984- 49 0 12
Boeing 767-300ER........................ Wide 220 2 X GE 1986- 258 41 42
2 X PW 1987- 152 11 23
2 X RR 1989- 31 0 2
2 X TBA 0 9 0
Fokker 50............................... Turboprop 50 2 X PW 1987- 188 0 30
Fokker 70............................... Narrow 70 2 X RR 1994- 43 0 9
MDC MD-82............................... Narrow 140 2 X PW 1981-1997 584 0 28
MDC MD-83............................... Narrow 140 2 X PW 1984-1999 278 0 27
- ---------------
Source: Airclaims Limited.
(1) The above table identifies engine manufacturers by the following
abbreviations:
GE = General Electric
PW = Pratt & Whitney
CFM = CFM International
IAE = International Aero Engines
RR = Rolls Royce
TBA = To be announced
(2) The number of operators does not include lessors.
E-1-10
11
DESCRIPTION OF THE LESSEES
The table below sets forth certain available information with respect to
the country of domicile, first year of operation, service type, nature of
ownership and fleet size and composition of each lessee as of February 15, 2000.
BEGAN SERVICE OPERATING
LESSEE DOMICILE OPERATION TYPE OWNERSHIP FLEET(1)
- ------ -------- --------- ------- --------- ---------
Aer Lingus Ireland 1936 Scheduled, Irish Government (95%) 6 A321-210
Chartered and Employees (5%) 1 A330-200
Freight 5 A330-300
4 B737-400
7 B737-500
3 BAe 146-200
6 BAe 146-300
4 F-50
Aeromexico Mexico 1934 Scheduled Cintra (90%) 9 B757-200
Employees (10%) 3 B767-200ER
2 B767-300ER
2 DC-9-31
15 DC-9-32
13 MD-82
10 MD-83
4 MD-87
10 MD-88
Air 2000 United Kingdom 1986 Scheduled and First Choice Holidays (100%) 4 A320-230
Chartered 5 A321-210
13 B757-200
3 B767-300ER
Air Alfa Turkey 1992 Chartered Kombassan Holdings (100%) 2 A300-B4-100
2 A300-600R
3 A321-130
Air Atlanta Iceland 1986 Chartered and Private (100%) 1 B747-100
Icelandic Wet Leases 2 B747-200B
3 B747-300
1 L10-11 Tristar
Air Europa Spain 1986 Scheduled and Juan Jose Hidalgo 8 B737-300
Chartered Acera (79%) 4 B737-400
A Guiterrex Saiz (7.2%) 7 B737-800
Herpil (5%) 1 B767-200EM
Viajes Sidetours (5%) 1 B767-200ER
Other (3.8%) 16 BAe ATP
Air Liberte France 1987 Scheduled and British Airways (70%) 1 ATR 42
Chartered Groupe Bullore (30%) 2 DC-10-30
1 DC-10-30ER
1 F-27
11 F-100
4 F-28
2 MD-82
10 MD-83
Air Macau Macau 1994 Scheduled Macau Aviation Services 2 A320-200
Company (46%) 4 A321-100
TAP Air Portugal (25%) 1 A321-200
Evergreen Airway
Services (5%)
Other (24%)
Air Malta Malta 1973 Scheduled and Maltese Government (96.4%) 2 A320-200
Chartered Middle Sea Insurance (3.3%) 2 B737-200A
Cassar and Cooper (Holidays) 6 B737-300
Ltd (0.3%) 1 B737-400
E-1-11
12
BEGAN SERVICE OPERATING
LESSEE DOMICILE OPERATION TYPE OWNERSHIP FLEET(1)
- ------ -------- --------- ------- --------- ---------
Air Mauritius Mauritius 1967 Scheduled and Air Mauritius Holdings (51%) 5 A340-300
Chartered Public (16.74%) 1 ATR 42-300
Government of Mauritius 2 ATR 42-500
(10.86%) 2 B767-200ER
Rogers & Company (4.49%)
State Investment Corp
(4.47%)
British Airways Associated
Companies (3.84%)
Employees (3.26%)
Air France (2.78%)
Air India (2.56%)
Air New Zealand New Zealand 1941 Scheduled Brierley Investment (42.4%) 8 B737-200
Franklin Resources (10.6%) 1 B737-200QC
Other (47%) 9 B737-300
1 B747-200B
8 B747-400
4 B767-200ER
10 B767-300ER
Air Pacific Fiji 1951 Scheduled Government of Fiji (51%) 1 B737-700
Qantas (46%) 2 B737-800
Air New Zealand (1.27%) 2 B747-200B
Other (1.46%) 1 B767-300ER
Pacific Islands 1 EMB-120
Governments (0.27%)
Alaska Airlines United States of 1932 Scheduled Public (100%) 4 B737-200C
America and Freight 4 B737-200QC
40 B737-400
8 B737-700
5 MD-82
28 MD-83
Asiana South Korea 1988 Scheduled and Kumho Group (54.2%) 3 A321-200
Chartered Pacific Investment Capital, 20 B737-400
UBS S.A., 3 B737-500
Korean Development Bank, 8 B747-400
Korea Long Term Credit Bank 4 B747-400F
(45.8%) 9 B767-300
1 B767-300ER
1 B767-300ERF
B.R.A. Brazil 1995 Chartered Private (100%) 1 A310-300
Braathens Norway 1946 Scheduled and Braganza (33.4%) 5 B737-400
Chartered Other (31.2%) 20 B737-500
KLM (30%) 8 B737-700
Bramora (5.4%) 10 BAe-146-200
4 F-100
Britannia United Kingdom 1961 Chartered Thomson Travel Holdings 4 B737-800
(100%) 22 B757-200
4 B767-200EM
2 B767-200ER
10 B767-300ER
Canada 3000 Canada 1988 Chartered Canadian Investors (55%) 5 A320-200
Deluce Investments Inc (25%) 3 A330-200
Employees (20%) 6 B757-200
E-1-12
13
BEGAN SERVICE OPERATING
LESSEE DOMICILE OPERATION TYPE OWNERSHIP FLEET(1)
- ------ -------- --------- ------- --------- ---------
Canadian Canada 1986 Scheduled Canadian Airlines Corp (75%) 13 A320-200
and Freight Aurora Airline Investment 38 B737-200A
Inc (25%) 6 B737-200C
4 B747-400
14 B767-300ER
4 DC 10-30
4 DC 10-30ER
31 F-28
10 Dash 8-100
14 Dash 8-300
Cathay Pacific Hong Kong 1946 Scheduled Swire Pacific (43.9%) 12 A330-300
and Freight China International Trust 14 A340-300
and Investment Corp (25%) 3 B747-200F
Other (31.1%) 1 B747-200SF
19 B747-400
2 B747-400F
4 B777-200
7 B777-300
China Airlines Taiwan 1959 Scheduled, China Civil Aviation 12 A300-600R
Chartered Development Foundation 4 A300-B4-200
and Freight (71.1%) 10 B737-800
Other (28.9%) 2 B747-200F
8 B747-200SF
12 B747-400
2 B747-400F
2 Beechjet 400
2 MD-11
China Hainan China 1991 Scheduled and American Aviation 5 B737-300
Executive Investment (25%) 7 B737-400
Charters Other (69.7%) 5 B737-800
Hainan Provincial Government 1 Beechjet 400
(5.3%) 2 Dornier 328
1 Hawker 800
1 Learjet-60
9 Metro 23
Continental United States of 1934 Scheduled Other (71%) 31 ATR 42-300
America Northwest Airlines (15%) 6 ATR 42-500
Air Partners LP (14%) 2 ATR 72-210
13 B727-200A
4 B727-200F
65 B737-300
66 B737-500
36 B737-700
41 B737-800
2 B747-200B
39 B757-200
14 B777-200ER
1 DC 9-31
2 DC 9-32
27 DC 10-30
3 DC10-30ER
21 EMB-120
1 EMB-120ER
7 ERJ-135
56 ERJ-145
5 MD-81
56 MD-82
8 MD-83
25 Raytheon 1900
E-1-13
14
BEGAN SERVICE OPERATING
LESSEE DOMICILE OPERATION TYPE OWNERSHIP FLEET(1)
- ------ -------- --------- ------- --------- ---------
F.E.A.T. Taiwan 1957 Scheduled Other (67.05%) 7 B757-200
China Development Corp. 3 MD-82
(14%) 5 MD-83
China Airlines (10%)
Taiwan Aerospace Corporation
(4.95%)
Fubon Insurance (4%)
Flying Colours United Kingdom 1995 Chartered Thomas Cook 11 B757-200
Travel Group Ltd. (100%)
Icelandair Iceland 1937 Scheduled Public (100%) 1 B737-300F
and Freight 3 B737-400
6 B757-200
1 B757-200 PF
KLM The Netherlands 1919 Scheduled Other (75%) 4 ATR 72-200
and Freight Government of The 2 BAe 146-300
Netherlands (25%) 19 B737-300
19 B737-400
4 B737-800
8 B747-200B
2 B747-200SF
3 B747-300
20 B747-400
12 B767-300ER
17 F-100
9 F-50
10 MD-11
KLM CityHopper The Netherlands 1966 Scheduled KLM (100%) 13 F-50
12 F-70
L'Aeropostale France 1986 Chartered and Groupe Air France (50%) 2 A300 B4-100F
Postal Groupe La Poste (50%) 4 ATR 72-200
3 B737-200A
1 B737-200QC
15 B737-300QC
Lithuanian Lithuania 1991 Scheduled and Government of Lithuania 1 An-24-RV
Chartered (100%) 2 B737-200A
1 B737-300
1 B737-500
2 Saab 340
2 Saab 2000
6 Yak-42
Malev Hungary 1946 Scheduled and Government of Hungary 3 B737-200A
Chartered (96.8%) 4 B737-300
Municipalities (2.7%) 2 B737-400
Other (0.5%) 2 B737-500
2 B767-200ER
6 F-70
6 TU-154
Mexicana Mexico 1921 Scheduled Cintra (88.7%) 16 A320-230
Other (11.3%) 22 B727-200A
6 B757-200
12 F-100
Monarch United Kingdom 1967 Chartered and Cosmos Guide Holding 4 A300-600R
Scheduled International N.V. (100%) 3 A320-200
3 A321-200
2 A330-200
5 B757-200
1 DC10-30
1 L10-11 Tristar
E-1-14
15
BEGAN SERVICE OPERATING
LESSEE DOMICILE OPERATION TYPE OWNERSHIP FLEET(1)
- ------ -------- --------- ------- --------- ---------
National Airlines United States of 1998 Scheduled Rio Hotel, Harrah 12 B757-200
America Entertainments
and Wexford Management
(100%)
Olympic Greece 1957 Scheduled Government of Greece (100%) 1 A300-B4-100
1 A300-B4-200
2 A300-600R
4 A340-300
4 ATR 42-300
7 ATR 72-200
2 B717-200
11 B737-200A
1 B737-300
12 B737-400
1 B747-200B
6 Fairchild 228
Pegasus Turkey 1990 Chartered Yapi Kredit Bank (49%) 4 B737-400
Silkar and Net Holdings 1 B737-800
(30%)
Alper Elichin (21%)
Region Air Singapore 1988 Chartered Hotel Properties Ltd 2 A310-300
(100%)
Southwest United States of 1981 Scheduled Public (90%) 35 B737-200A
America Employees (10%) 195 B737-300
25 B737-500
58 B737-700
TransAer Ireland 1991 Chartered Translift Holding (100%) 1 A300-B4-200
1 A320-230
Transavia The Netherlands 1965 Scheduled and KLM (80%) 6 B737-300
Chartered Nationale Investeringsbank 4 B737-800
(20%) 4 B757-200
TWA United States of 1930 Scheduled Public (65%) 1 B727-200
America Employees (30%) 11 B727-200A
Prince Al-Waleed bin Talal 2 B747-100
(5%) 10 B767-200EM
6 B767-300ER
16 DC-9-31
12 DC-9-32
1 DC-9-33CF
7 DC-9-51
1 L10-11 Tristar
40 MD-82
64 MD-83
VASP Brazil 1933 Scheduled Employees and Canhedo 3 A300-B2-200FF
Group (60%) 5 B727-200F
Sao Paolo State 6 B737-200
Government (40%) 13 B737-200A
1 B737-200C
1 B737-200CA
1 B737-200F
7 B737-300
7 MD-11
- ---------------
(1) Includes the operating fleet of the lessee's wholly owned subsidiaries.
Source: Airclaims Limited.
E-1-15
16
THE LEASES
As of February 15, 2000, we had 61 leases in effect, covering our whole
portfolio except one aircraft which was off-lease. Under three of the lease
contracts, the lessee has not yet taken delivery of the aircraft. In two cases
delivery is scheduled for April 1, 2000 and in the third case delivery is
scheduled for March 17, 2000. Our one off-lease aircraft is subject to a
non-binding letter of intent for lease. Although the lease documentation is
fairly standardized in many respects, significant variations do exist as a
result of negotiation with each lessee. The following is a summary of the
principal characteristics of the leases as of February 15, 2000 (with appraised
values as of November 30, 1999).
PRESENT VALUE OF ALL
CONTRACTED LEASE RENTAL
PAYMENTS................. Approximately $742.0 million (discounted to the
closing date of this offering at a rate of 7.50%).
This amount represents 40.5% of our total debt
outstanding upon the closing of this offering.
CONTRACTED LEASE
EXPIRIES................... The weighted average remaining contracted lease
term of the portfolio (weighted by appraised values
as of November 30, 1999 and without giving effect
to purchase options, early terminations or
extensions) was 42 months. We will be required to
re-lease 48 of the aircraft, representing 75.14% of
the portfolio by appraised value, before December
31, 2004. The longest lease is scheduled to expire
in September 2007.
EXTENSION OPTIONS.......... Thirty of the leases include outstanding options
for the lessee to extend the term of the lease.
Assuming that all these options were exercised to
extend the leases to the latest possible dates, the
weighted average remaining lease term of the
portfolio would be 56 months and the weighted
average extended rent payable over the extended
period would be 103.80% of the current contracted
rental payments.
EARLY TERMINATION
OPTIONS.................... Four of the leases allow the lessee to terminate
its lease before the scheduled expiration date,
provided certain conditions are met. Assuming that
all these options were exercised for the earliest
possible termination, the weighted average
remaining lease term of the portfolio would be 42
months.
PURCHASE OPTIONS........... Ten lessees have outstanding options to purchase a
total of 12 aircraft, representing 28.36% of the
portfolio by appraised value. The latest date on
which a purchase option may be exercised is June 8,
2008, for a purchase on March 8, 2009. If these
options were exercised on their earliest exercise
date, in only one case would the purchase option
strike price be below the note target price for the
applicable aircraft. This difference would not be
significant.
CONDITIONAL SALE
AGREEMENT.................. One A310-300 aircraft is subject to a conditional
sale agreement under which, if all payments are
made, we must transfer title to the aircraft on
July 15, 2007. The present value of all amounts
payable (discounted to the closing date of this
offering at a rate of 7.50%) is approximately $5.1
million less than the note target price of the
aircraft on the closing date of this offering.
SECURITY DEPOSITS.......... Under 56 of the leases, the lessee has provided
security for its obligations. Our total security
deposits are $39.2 million in cash and $1.8 million
in letters of credit. Together these security
deposits are equivalent to 2.13 months of
contracted lease rental payments. For a discussion
of cash security deposits that ILFC holds on our
behalf, you should refer to "Liquidity -- ILFC
Facility".
E-1-16
17
GUARANTEES................. In various of the leases, where appropriate, we
have received guarantees or comfort letters from a
lessee's parent company or shareholders relating to
the lessee's payment and performance obligations
under the lease. In the case of one lessee we have
received a bank guarantee of its lease obligations
in the amount of $38 million.
THIRD PARTY LIABILITY
INSURANCE.................. The minimum third party liability limits under the
leases range from $250 million to $900 million. We
also have in place our own contingent liability
coverage to cover any liability in excess of the
lessee's coverage or where a lessee's coverage
lapses for any reason.
AIRCRAFT PROPERTY
INSURANCE.................. The total insured value for all risks aircraft hull
and hull war risks insurance for the portfolio is
$2,566.8 million. In all cases, the sum of the
stipulated lease value and our own additional
coverage in place is at least equal to the
appraised value of the aircraft and on average is
approximately 128% of the appraised value of the
aircraft. Permitted deductibles, which generally
apply only in the case of a partial loss, range
from $100,000 to $1,000,000.
SUBLEASES AND WET LEASES... Under certain of the leases, the lessee may
sublease the aircraft without our consent, provided
certain conditions are met. Under most of our
leases, the lessee may wet lease the aircraft
without our consent, provided that the lessee does
not part with operational control of the aircraft.
Where there is a sublease or a wet lease, the
lessee remains fully liable to us for all its
payment and performance obligations under the lease
and we have no contractual relationship with the
sublessee or the wet lessee. The following lessees
sublease their aircraft: Britannia (to Ansett
Australia Limited) and Icelandair (to Falcon Air
AB, based in Sweden). To our knowledge, only two
lessees wet lease their aircraft: Transaer (to
Libyan Airlines) and Pegasus (to Eurofly, based in
Italy). Our consent was not required for these wet
leases.
E-1-17