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TABLE OF CONTENTS
TABLE OF CONTENTS 2
Table of Contents
CALCULATION OF REGISTRATION FEE
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Title of each Class of
Securities to be Registered
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Amount to be
Registered
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Maximum
Offering Price
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Maximum
Aggregate
Offering Price
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Amount of
Registration Fee(1)
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4.250% Senior Notes due 2020 |
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$500,000,000 |
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100% |
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$500,000,000 |
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$58,100 |
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4.625% Senior Notes due 2022 |
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$500,000,000 |
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100% |
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$500,000,000 |
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$58,100 |
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Guarantees of Notes registered pursuant to this registration statement |
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(2) |
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Total |
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$116,200 |
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- (1)
- Calculated
in accordance with Rule 457(r) under the Securities Act of 1933, as amended.
- (2)
- Pursuant
to Rule 457(n) under the Securities Act, no separate fee is payable with respect to the guarantees.
Table of Contents
Filed Pursuant to Rule 424(b)(5)
Registration No. 333-205129
P R O S P E C T U S
S U P P L E M E N T
(To Prospectus Dated June 22, 2015)
$1,000,000,000
AerCap Ireland Capital Limited
AerCap Global Aviation Trust
$500,000,000 4.250% Senior Notes due 2020
$500,000,000 4.625% Senior Notes due 2022
Guaranteed by AerCap Holdings N.V.
AerCap Ireland Capital Limited, a private limited company incorporated under the laws of Ireland (the "Irish Issuer"), and AerCap Global Aviation
Trust, a Delaware statutory trust (the "U.S. Issuer" and, together with the Irish Issuer, the "Issuers"), are offering $500,000,000 aggregate principal amount of 4.250% Senior Notes due 2020 (the
"2020 Notes") and $500,000,000 aggregate principal amount of 4.625% Senior Notes due 2022 (the "2022 Notes" and, together with the 2020 Notes, the "Notes"). The Notes are being issued pursuant to an
indenture, dated as of May 14, 2014 (the "Indenture"), among the Issuers, the guarantors (as defined below) and Wilmington Trust, National Association, as trustee (the "Trustee").
The
Issuers will pay interest on the Notes semi-annually in arrears on January 1 and July 1 of each year, commencing on January 1, 2016.
The
Issuers may redeem some or all of the Notes at their option at any time and from time to time by paying a specified "make-whole" premium described under "Description of
NotesOptional redemption." If we experience a change in control followed by a ratings decline, the Issuers will be required to make an offer to purchase all of the Notes at the price
described under "Description of NotesRepurchase at the Option of HoldersChange in Control Triggering Event." The Issuers may
redeem the Notes at their option, at any time, in whole but not in part, in the event of certain developments affecting taxation described under "Description of
NotesRedemption for Changes in Withholding Tax."
The
Notes will be joint and several obligations of the Issuers and will be the Issuers' senior unsecured obligations. The Notes will be fully and unconditionally guaranteed (the
"guarantees") on a senior unsecured basis by AerCap Holdings N.V. (the "Parent Guarantor," and such guarantee, the "Parent Guarantee") and certain other subsidiaries of the Parent Guarantor
(together, the "guarantors") as described under "Description of NotesGuarantees." The Notes and the guarantees will rank pari passu in right of
payment with all senior debt of the Issuers and the guarantors and will rank senior in right of payment to all of the Issuers' and
the guarantors' subordinated debt. The Notes will be effectively subordinated to all of the Issuers' and each guarantor's existing and future secured debt to the extent of the value of the assets
securing such debt. The Notes will be structurally subordinated to all of the existing and future debt and other liabilities of the Parent Guarantor's subsidiaries (other than the Issuers) that do not
guarantee the Notes. See "Description of NotesRanking."
Investing in the Notes involves risk. You should carefully review the risks and uncertainties described under the heading
"Risk factors" beginning on page S-7 of this prospectus supplement before you make an investment in the Notes.
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Public Offering
Price (1) |
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Underwriting
Discount |
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Proceeds Before
Expenses to
the Issuers |
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Per note due 2020 |
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100 |
% |
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0.825 |
% |
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99.175 |
% |
Per note due 2022 |
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100 |
% |
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0.825 |
% |
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99.175 |
% |
Total |
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$ |
1,000,000,000 |
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$ |
8,250,000 |
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$ |
991,750,000 |
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- (1)
- Plus
accrued interest, if any, from June 25, 2015.
Neither the Securities and Exchange Commission nor any state or foreign securities commission has approved or disapproved of these securities or determined if
this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The
underwriters expect to deliver the Notes in global form through the book-entry system of The Depository Trust Company ("DTC") and its participants, including Euroclear
Bank S.A./N.V., as operator of the Euroclear System ("Euroclear"), and Clearstream Banking, societe anonyme ("Clearstream"), on or about
June 25, 2015.
Joint Book-Running Managers
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Credit Suisse |
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Deutsche Bank Securities |
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Goldman, Sachs & Co. |
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Barclays |
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BofA Merrill Lynch |
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Citigroup |
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Credit Agricole CIB |
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J.P. Morgan |
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Mizuho Securities |
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Morgan Stanley |
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RBC Capital Markets |
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UBS Investment Bank |
Wells Fargo Securities |
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Co-Managers
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BNP PARIBAS |
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Fifth Third Securities |
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HSBC |
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SunTrust Robinson Humphrey |
Prospectus
Supplement dated June 22, 2015
Table of Contents
TABLE OF CONTENTS
Prospectus Supplement
S-i
Table of Contents
ABOUT THIS PROSPECTUS SUPPLEMENT
We are responsible only for the information contained or incorporated by reference in this prospectus supplement or the accompanying
prospectus. We have not authorized any other person to provide you with information that is different from that contained or incorporated by reference in this prospectus supplement and the
accompanying prospectus. The information contained in this prospectus supplement and the accompanying prospectus is accurate only as of their respective dates, and any information we have incorporated
by reference is accurate only as of the date of the document incorporated by reference, regardless of the time of delivery of this prospectus supplement and the accompanying prospectus or of any sale
of the Notes.
This
document is in two parts. The first part is this prospectus supplement, which describes the specific terms of the offering and also adds to and updates information contained in the
accompanying prospectus and the documents incorporated by reference herein and therein. The second part is the accompanying prospectus, which gives more general information, some of which may not
apply to this offering. It is important for you to read and consider all information contained in this prospectus supplement and the accompanying prospectus in
making your investment decision. To fully understand this offering, you should also read all of these documents, including those referred to under the caption "Where You Can Find More Information" and
"Incorporation by Reference" in this prospectus supplement. Investors should carefully review the risk factors relating to us in the section captioned "Risk Factors" herein, in Item 3 of our
Annual Report on Form 20-F for the year ended December 31, 2014, filed with the Securities and Exchange Commission (the "SEC") on March 30, 2015 and in our Report on
Form 6-K, furnished to the SEC on June 1, 2015. To the extent there is a conflict between the information contained or incorporated by reference in this prospectus supplement, on the one
hand, and the information contained in the accompanying prospectus, on the other hand, the information contained or incorporated by reference in this prospectus supplement shall control. As used in
this prospectus supplement and the accompanying prospectus, unless otherwise stated or the context otherwise requires, references to "AerCap," "we," "us," "our" and "the Company" include AerCap
Holdings N.V. and its subsidiaries as a combined entity.
This
prospectus supplement has not been prepared in accordance with and is not a "prospectus" or a "supplement" for the purposes of Directive 2003/71/EC (as amended by Directive
2010/73/EU) (the "Prospectus Directive") and has not been reviewed or approved by the Central Bank of Ireland or any other competent authority for the purposes of the Prospectus Directive and is
referred to as a "prospectus supplement" because this is the terminology used for such an offer document in the U.S.
This
prospectus supplement has been prepared on the basis that any offer of notes in any Member State of the European Economic Area which has implemented the Prospectus Directive (each,
a "Relevant Member State") will be made pursuant to an exemption under the Prospectus Directive from the requirement to publish a prospectus for offers of notes. Accordingly any person making or
intending to make an offer in that Relevant Member State of notes which are the subject of the offering contemplated in this prospectus supplement may only do so in circumstances in which no
obligation arises for the Issuers, the Guarantors or the underwriters to publish a prospectus pursuant to Article 3 of the Prospectus Directive or supplement a prospectus pursuant to
Article 16 of the Prospectus Directive, in each case, in relation to such offer. Neither the Issuers, the Guarantors nor the underwriters have authorized, nor do they authorize, the making of
any offer of notes in circumstances in which an obligation arises for the Issuers, the Guarantors or the underwriters to publish or supplement a prospectus for such offer. In this paragraph, the
expression "Prospectus
S-ii
Table of Contents
Directive"
means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing
measure in the Relevant Member State and the expression "2010 PD Amending Directive" means Directive 2010/73/EU.
Except
as otherwise noted, all dollar amounts in this prospectus supplement, the accompanying prospectus and the documents incorporated by reference herein and therein are in U.S.
dollars. The consolidated financial statements of the Company and of International Lease Finance Corporation ("ILFC") incorporated by reference herein have been prepared in accordance with United
States generally accepted accounting principles ("GAAP").
S-iii
Table of Contents
FORWARD LOOKING STATEMENTS
This prospectus supplement, the accompanying prospectus and the documents incorporated by reference into this prospectus supplement and
the accompanying prospectus include "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. We have based these forward looking statements on our
current beliefs and projections about future events and financial trends affecting our business. Many important factors, in addition to those discussed in this prospectus supplement, could cause our
actual results to differ substantially from those anticipated in our forward looking statements, including, among other things:
-
- the availability of capital to us and to our customers and changes in interest rates,
-
- the ability of our lessees and potential lessees to make operating lease payments to us,
-
- our ability to successfully negotiate aircraft purchases, sales and leases, to collect outstanding amounts due and to repossess
aircraft under defaulted leases, and to control costs and expenses,
-
- decreases in the overall demand for commercial aircraft leasing and aircraft management services,
-
- the economic condition of the global airline and cargo industry and the general economic and political conditions,
-
- competitive pressures within our industry,
-
- the negotiation of aircraft management services contracts,
-
- our ability to achieve the anticipated benefits of the acquisition of ILFC from AIG,
-
- regulatory changes affecting commercial aircraft operators, aircraft maintenance, engine standards, accounting standards and taxes,
and
-
- the risks described or referred to in "Risk Factors" in this prospectus or any
prospectus supplement, in our Annual Report on Form 20-F for the year ended December 31, 2014 and in our Report on Form 6-K furnished to the SEC on June 2, 2015.
The
words "believe", "may", "aim", "estimate", "continue", "anticipate", "intend", "expect" and similar words are intended to identify forward looking statements. Forward looking
statements include information concerning our possible or assumed future results of operations, business strategies, financing plans, competitive position, industry environment, potential growth
opportunities, the effects of future regulation and the effects of competition. Forward looking statements speak only as of the date they were made and we undertake no obligation to update publicly or
to revise any forward looking statements because of new information, future events or other factors. In light of the risks and uncertainties described above, the forward looking events and
circumstances described in this prospectus supplement and the accompanying prospectus might not occur and are not guarantees of future performance. The factors described above should not be construed
as exhaustive and should be read in conjunction with the other cautionary statements and the risk factors that are included under "Risk Factors" herein,
in our Annual Report on Form 20-F for the year ended December 31, 2014 and our Reports on Form 6-K incorporated by reference herein. Except as required by applicable law, we do
not undertake any obligation to publicly update or review any forward looking statement, whether as a result of new information, future developments or otherwise.
S-iv
Table of Contents
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the information reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as
applicable to foreign private issuers. As a "foreign private issuer," we are exempt from the rules under the Exchange Act prescribing certain disclosure and procedural requirements for proxy
solicitations. We file with the SEC an Annual Report on Form 20-F containing financial statements audited by an independent registered public accounting firm. We also file Reports on
Form 6-K containing unaudited interim financial information for the first three quarters of each fiscal year.
You
may read and copy any document we file with or furnish to the SEC at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may also obtain
copies of the documents at prescribed rates by writing to the Public Reference Section of the SEC at 100 F Street, N.E., Washington, DC 20549. Please call the SEC at 1-800-SEC-0330 to
obtain information on the operation of the Public Reference Room. In addition, the SEC maintains an Internet site that contains reports, proxy and information statements, and other information
regarding issuers that file electronically with the SEC. You can review our SEC filings,
including the registration statement, by accessing the SEC's Internet website at www.sec.gov. We will provide each person to whom a prospectus supplement is delivered a copy of any or all of the
information that has been incorporated by reference into this prospectus supplement but not delivered with this prospectus supplement upon written or oral request at no cost to the requester. Requests
should be directed to: AerCap Holdings N.V., Stationsplein 965, 1117 CE Schiphol Airport, The Netherlands, Attention: Compliance Officer, or by telephoning us at
+31 20 655 9655. Our website is located at www.aercap.com. The reference to the website is an inactive textual reference only and the information contained on our website is
not a part of this prospectus supplement.
S-v
Table of Contents
INCORPORATION BY REFERENCE
The following documents filed with or furnished to the SEC are incorporated herein by
reference:
-
- AerCap's Annual Report on Form 20-F for the year ended December 31, 2014, as filed with the SEC on March 30, 2015
together with the Form 6-K filed with the SEC on April 23, 2015; and
-
- AerCap's Reports on Form 6-K, furnished to the SEC on May 14, 2014, January 5, 2015, January 16, 2015,
March 30, 2015, April 2, 2015, April 23, 2015, May 7, 2015, May 18, 2015, May 20, 2015, June 2, 2015, June 2, 2015, June 5, 2015,
June 9, 2015, June 12, 2015 and June 16, 2015.
The
financial statements of ILFC are incorporated in this prospectus supplement by reference to our Report on Form 6-K dated May 14, 2014, and have been so incorporated to
satisfy the requirements of Rules 3-05 and 3-10(g) of Regulation S-X.
All
documents subsequently filed by us with the SEC pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act and, solely to the extent designated therein, Reports on
Form 6-K that we furnish to the SEC, in each case prior to the completion or termination of this offering or, if later, until the date on which any of our affiliates cease offering and selling
the Notes, shall be incorporated by reference in this prospectus supplement and be a part hereof from the date of filing or furnishing of such documents. Any statement contained herein or in a
document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this prospectus supplement to the extent that a statement contained
herein or in any subsequently filed document that also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not
be deemed, except as so modified or superseded, to constitute a part of this prospectus supplement.
S-vi
Table of Contents
PROSPECTUS SUMMARY
This summary highlights the information contained elsewhere in or incorporated by reference in this prospectus
supplement. Because this is only a summary, it does not contain all of the information that may be important to you. You should read this
entire prospectus supplement carefully together with the information incorporated by reference herein, including "Risk Factors" and the financial statements, and notes related thereto, incorporated by
reference in this prospectus supplement, before making an investment decision.
Our Business
We are the world's largest independent aircraft leasing company. We focus on acquiring in-demand aircraft at attractive prices, funding
them efficiently, hedging interest rate risk conservatively and using our platform to deploy those assets with the objective of delivering superior risk adjusted returns. We believe that by applying
our expertise through an integrated business model, we will be able to identify and execute on a broad range of market opportunities that we expect will generate attractive returns for our
shareholders. We are an independent aircraft lessor, and, as such, we are not affiliated with any airframe or engine manufacturer. This independence provides us with purchasing flexibility to acquire
aircraft or engine models regardless of the manufacturer.
We
operate our business on a global basis, leasing aircraft to customers in every major geographical region. As of December 31, 2014, we owned 1,132 aircraft, excluding three
aircraft that were owned by AeroTurbine, managed 147 aircraft, including those owned and on order by AerDragon, had 380 new aircraft on order, including 205 A320neo family aircraft,
66 Boeing 787 aircraft, 50 Embraer E-Jets E2 aircraft, 29 A350 aircraft, 25 Boeing 737 aircraft, four A321 aircraft, and one A330 aircraft, excluding five Boeing purchase rights.
The average age of our 1,132 owned aircraft fleet, weighted by net book value, was 7.7 years as of December 31, 2014.
We
lease most of our aircraft to airlines under operating leases. Under an operating lease, the lessee is responsible for the maintenance and servicing of the equipment during the lease
term and the lessor receives the benefit, and assumes the risk, of the residual value of the equipment at the end of the lease. As of December 31, 2014, our owned and managed aircraft were
leased to over 200 commercial airline and cargo operator customers in approximately 90 countries.
We
have the infrastructure, expertise and resources to execute a large number of diverse aircraft transactions in a variety of market conditions. During the year ended
December 31, 2014, we executed over 365 aircraft transactions. Our teams of dedicated marketing and asset trading professionals have been successful in leasing and managing our aircraft
portfolio. During the year ended December 31, 2014, our weighted average owned aircraft utilization rate was 99.2%, calculated based on the average number of months the aircraft are on lease
each year. The utilization rate is weighted proportionate to the net book value of the aircraft at the end of the period measured.
Recent Developments
On June 3, 2015, we announced the pricing of an underwritten secondary offering (the "Secondary Offering") of 71,184,686 of our
ordinary shares by American International Group, Inc. ("AIG" or the "Selling Shareholder") at a price to the public of $49.00 per share.
On
June 1, 2015, we entered into a share repurchase agreement (the "Share Repurchase Agreement") among AerCap Global Aviation Trust and the other guarantors named therein,
S-1
Table of Contents
the
Selling Shareholder and AIG Capital Corporation. Under the terms of the Share Repurchase Agreement, AerCap agreed with AIG to repurchase $750 million of AerCap's ordinary shares (the "Share
Repurchase") at a price per share equal to the least of (1) the price per ordinary share paid by the underwriters to the Selling Shareholder in the Secondary Offering, (2) 104% of the
last closing price per ordinary share reported on the New York Stock Exchange prior to the public announcement of the Secondary Offering and (3) 110% of the opening price per ordinary share
reported on the New York Stock Exchange on the date of the Share Repurchase Agreement. Consideration for the Share Repurchase consisted of the issuance of $500 million of fixed-to-floating rate
junior subordinated notes due 2045 (the "AIG Notes") to AIG and $250 million of cash. Pursuant to the Share Repurchase Agreement, upon the issuance of the AIG Notes, the amount available to
AerCap Ireland Capital Limited, as borrower under the $1.0 billion revolving credit facility provided to AerCap by AIG, was reduced by $500 million (the "AIG Revolver Reduction").
Upon
the closing of the Secondary Offering and the Share Repurchase, as of June 9, 2015, AIG beneficially owned approximately 5% of our ordinary shares. The underwriters in the
Secondary Offering have an option to purchase the remaining ordinary shares held by AIG until July 3, 2015.
Pursuant
to the Share Repurchase Agreement, AerCap Global Aviation Trust (the "Issuer") issued to the Selling Shareholder $500 million in aggregate principal amount of the AIG
Notes, which will accrue interest at a fixed interest rate of 6.50% per annum up to, but excluding, June 15, 2025, payable semi-annually. The AIG Notes will accrue interest from and including
June 15, 2025, up to, but excluding, the maturity date or earlier redemption date, at a floating rate based on the three-month LIBOR rate plus 4.30%, reset quarterly, payable quarterly. The
Issuer will have certain rights to defer interest payments on the AIG Notes for one or more interest periods for up to five consecutive years per deferral period. Subject to the terms of the indenture
governing the AIG Notes, the Issuer may redeem the AIG Notes, in whole or in part, at any time on and after June 15, 2025 at a redemption price of 100% of the principal amount redeemed, plus
accrued and unpaid interest thereon. In addition, subject to the terms of the indenture governing the AIG Notes, the Issuer may redeem the AIG Notes, in whole but not in part, (1) upon a
"rating agency event" (as defined in the AIG Notes), at a make-whole redemption price, and (2) in the event that the Issuer may be required to pay additional amounts in respect of certain
withholding taxes resulting from a change of law, at a redemption price of 100% of the principal amount redeemed, plus, in each case, accrued and unpaid interest thereon. If we experience a "change of
control" followed by a "ratings decline" (each as defined in the AIG Notes) (a "change of control triggering event"), the AIG Notes may be redeemed at the Issuer's option, in whole but not in part, at
a price of 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of the redemption. If (i) a change of control triggering event occurs and (ii) the
Issuer does not give notice prior to the 31st day following the change of control triggering event to redeem all outstanding AIG Notes, the interest rate per annum of the AIG Notes will
increase by 5.00%. The AIG Notes are guaranteed (the "AIG Note Guarantees") by the guarantors of the Notes and the Irish Co-Issuer (the "AIG Note Guarantors").The AIG Notes and the AIG Note Guarantees
are the Issuer's and the AIG Note Guarantors' junior subordinated unsecured obligations, rank equally with all of the Issuer's and the AIG Note Guarantors' future equally ranking junior subordinated
indebtedness, if any, and are subordinate and junior in right of payment to all of the Issuer's and the AIG Note Guarantors' existing and future senior indebtedness, including the Notes and the
Guarantees thereof.
S-2
Table of Contents
THE OFFERING
The summary below describes the principal terms of the Notes. Certain of the terms and conditions described
below are subject to important limitations and exceptions. The following is not intended to be complete. You should carefully review the "Description of Notes" section of this prospectus supplement,
which contains a more detailed
description of the terms and conditions of the Notes. In this subsection, "we"", "us" and "our" refer only to the Issuers.
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Issuers: |
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AerCap Ireland Capital Limited and AerCap Global Aviation Trust. |
Securities Offered: |
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$1,000,000,000 aggregate principal amount of notes, consisting of: |
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$500,000,000 aggregate principal amount of 4.250% Senior Notes due 2020 |
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$500,000,000 aggregate principal amount of 4.625% Senior Notes due 2022 |
Maturity Dates: |
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The 2020 Notes will mature on July 1, 2020. |
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The 2022 Notes will mature on July 1, 2022. |
Interest: |
|
Interest on the Notes will be payable semiannually in arrears on January 1 and July 1 of each year, commencing on
January 1, 2016. The 2020 Notes will bear interest at 4.250% per year. The 2020 Notes will bear interest at 4.625% per year. Interest will accrue from June 25, 2015. |
Guarantees: |
|
The Notes will be fully and unconditionally guaranteed, jointly and severally and on a senior unsecured basis, by the Parent
Guarantor, AerCap Aviation Solutions B.V., AerCap Ireland Limited, ILFC and AerCap U.S. Global Aviation LLC. See "Description of NotesGuarantees." |
Ranking |
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The Notes and the guarantees will be our and the guarantors' general unsecured senior indebtedness and will: |
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rank senior in right of payment to any of our
and the guarantors' obligations that are, by their terms, expressly subordinated in right of payment to the Notes and the guarantees; |
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rank pari
passu in right of payment to all of our and the guarantors' existing and future senior indebtedness and other obligations that are not, by their terms, expressly subordinated in right of payment to the Notes and the
guarantees; |
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be effectively subordinated to all of our and
the guarantors' existing and future secured indebtedness and other secured obligations to the extent of the value of the assets securing such indebtedness and other obligations; and |
S-3
Table of Contents
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be structurally subordinated to all existing
and future obligations and other liabilities (including trade payables) of each of the Parent Guarantor's subsidiaries (other than the Issuers) that do not guarantee the Notes. |
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See "Description of NotesRanking." |
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Giving pro forma effect to this offering, the issuance of the AIG Notes and the AIG Revolver Reduction, as of March 31,
2015, the principal amount of our outstanding indebtedness, which excludes fair value adjustments of $1.2 billion, was approximately $30.6 billion, of which approximately $12.8 billion was secured, and we had total unused lines of
credit of approximately $5.1 billion, subject to certain conditions, including compliance with certain financial covenants. |
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In addition, as of March 31, 2015, the Parent Guarantor's subsidiaries that are not guarantors of the Notes (other than
the Issuers) had total liabilities, including trade payables (but excluding intercompany liabilities), of $13.0 billion and total assets (excluding intercompany receivables) of $20.3 billion. In addition, for the three months ended
March 31, 2015, our subsidiaries that are not guarantors generated approximately $249.6 million, or 81% of our consolidated net income, and $0.7 billion, or 52%, of our total revenues and other income. |
Additional Amounts: |
|
The Issuers and the guarantors will make all payments in respect of the Notes or the guarantees, including principal and
interest payments, without deduction or withholding for or on account of any present or future taxes or other governmental charges in Ireland, the Netherlands, the United States or certain other relevant tax jurisdictions, unless they are obligated
by law to deduct or withhold such taxes or governmental charges. If we or any guarantor is obligated by law to deduct or withhold taxes or governmental charges in respect of the Notes or the guarantees, subject to certain exceptions, we or the
relevant guarantor, as applicable, will pay to the holders of the Notes additional amounts so that the net amount received by the holders after any deduction or withholding will not be less than the amount the holders would have received if those
taxes or governmental charges had not been withheld or deducted. See "Description of NotesAdditional Amounts." |
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S-4
Table of Contents
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Optional Redemption for Changes in Withholding Taxes: |
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If we become obligated to pay any additional amounts as a result of any change in the law of Ireland, the Netherlands, the United States or
certain other relevant taxing jurisdictions that becomes effective after the date on which the Notes are issued (or on the date the relevant taxing jurisdiction became applicable, if later), we may redeem the Notes at our option in whole, but not in
part, at any time at a price equal to 100% of the principal amount of the Notes, plus any accrued and unpaid interest, if any, to the redemption date and additional amounts to the redemption date. See "Description of
NotesRedemption for Changes in Withholding Taxes." |
Optional Redemption: |
|
We may redeem each series of the Notes, in whole or in part, at any time at a price equal to 100% of the aggregate principal
amount of the Notes plus the applicable "make-whole" premium, as described in "Description of NotesOptional Redemption," plus accrued and unpaid interest, if any, to the redemption
date. |
Change of Control Triggering Event: |
|
If we experience a change of control followed by a ratings decline, holders will have the right to require us to purchase
each holder's notes at a price of 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase. See "Description of NotesRepurchase at the Option of the HoldersChange of
Control Triggering Event." |
Certain Covenants: |
|
The Indenture contains covenants that, among other things, limit the ability of us, the Parent Guarantor and the Parent
Guarantor's restricted subsidiaries to: |
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incur liens on assets, subject to certain
exceptions, including the ability to incur additional liens to secure indebtedness for borrowed money in an amount not to exceed 12.5% of the consolidated net tangible assets of the Parent Guarantor and its restricted subsidiaries; |
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declare or pay dividends or acquire or retire
shares of our capital stock during the pendency of certain events of default; |
|
|
designate, except in compliance with certain
terms, restricted subsidiaries as unrestricted subsidiaries or designate unrestricted subsidiaries as restricted subsidiaries; |
|
|
make investments in or transfer assets to
unrestricted subsidiaries during the pendency of a default or event of default; and |
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|
|
|
|
|
consolidate, merge or sell or otherwise
dispose of all or substantially all of our assets. |
|
|
These covenants are subject to important qualifications and exceptions as described under "Description of NotesCertain Covenants." |
Use of Proceeds: |
|
We will use the net proceeds from this offering to acquire, invest in, finance or refinance aircraft assets, to repay
indebtedness and for other general corporate purposes. |
Tax Consequences: |
|
For a discussion of the possible Irish, Netherlands and U.S. federal income tax consequences of an investment in the Notes,
see "Certain Irish, Netherlands and U.S. Federal Income Tax Consequences." You should consult your own tax advisor to determine the Irish, Netherlands, U.S. federal, state, local and other tax
consequences of an investment in the Notes. |
Risk Factors: |
|
You should carefully consider the information set forth herein under "Risk Factors" and in the section captioned "Risk Factors" in Item 3 of our Annual Report on Form 20-F for the year ended December 31, 2014, filed with the SEC on March 30, 2015, before deciding whether to invest in the
Notes. |
Denominations: |
|
The Notes will be issued in minimum denominations of $150,000 and integral multiples of $1,000 above that
amount. |
Listing: |
|
Application will be made to the Irish Stock Exchange plc (the "Irish Stock Exchange") for the Notes to be admitted to
the Official List and to trading on the Global Exchange Market of the Irish Stock Exchange. We cannot assure you, however, that this application will be accepted. Currently, there is no public market for the Notes. |
Governing Law: |
|
State of New York. |
Trustee: |
|
Wilmington Trust, National Association. |
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RISK FACTORS
In addition to the other information included or incorporated by reference in this prospectus supplement or the
accompanying prospectus, including in the section captioned "Risk Factors" in Item 3 of our Annual Report on Form 20-F for the year ended December 31, 2014 and the matters
addressed under "Forward Looking Statements" in the accompanying prospectus, you should carefully consider the following risks before making any investment decisions with respect to the
Notes.
Our substantial debt could adversely affect our cash flow and prevent us from fulfilling our
obligations under our existing indebtedness and the Notes.
Giving pro forma effect to this offering and the issuance of the AIG Notes, as of March 31, 2015, the principal amount of our
outstanding indebtedness, which
excludes fair value adjustments of $1.2 billion, would have been approximately $30.6 billion (approximately 68% of our total assets as of that date), and for the three months ended
March 31, 2015 our interest expense would have been $0.3 billion. Due to the capital intensive nature of our business, we expect that we will incur additional indebtedness in the future
and continue to maintain significant levels of indebtedness. Giving pro forma effect to this offering and the issuance of the AIG Notes, our fixed rate debt of $21.7 billion would have
represented 71% of our principal amount of outstanding indebtedness as of March 31, 2015. Our level of indebtedness:
-
- requires a substantial portion of our cash flows from operations to be dedicated to interest and principal payments and therefore not
available to fund our operations, working capital, capital expenditures, expansion, acquisitions or general corporate or other purposes;
-
- may make it more difficult for us to satisfy our obligations with respect to the Notes;
-
- restricts the ability of some of our subsidiaries and joint ventures to make distributions to us;
-
- may impair our ability to obtain additional financing on favorable terms or at all in the future;
-
- may limit our flexibility in planning for, or reacting to, changes in our business and industry; and
-
- may make us more vulnerable to downturns in our business, our industry or the economy in general.
Despite our substantial debt, we may still be able to incur significantly more debt, including
secured debt, which would increase the risks described herein.
Despite our current indebtedness levels, we expect to incur additional debt in the future to finance our operations, including
purchasing aircraft and meeting our contractual obligations. The agreements relating to our debt, including our indentures, securitizations, term loan facilities, ECA guaranteed financings, revolving
credit facilities, subordinated joint venture agreements, and other financings, limit but do not prohibit our ability to incur additional debt. If we increase our total indebtedness, our debt service
obligations will increase. We will become more exposed to the risks arising from our substantial level of indebtedness as described above as we become more leveraged. Giving pro forma effect to the
AIG Revolver Reduction, as of March 31, 2015, we would have had approximately $5.1 billion of unused lines of credit, subject to certain conditions, including compliance with
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certain
financial covenants. We regularly consider market conditions and our ability to incur indebtedness to either refinance existing indebtedness or for working capital. If additional debt is added
to our current debt levels, the related risks we face could increase.
The Irish Issuer, the Parent Guarantor and the other guarantors of the Notes are primarily holding
companies with very limited operations and may not have access to sufficient cash to make payments on the Notes.
The Irish Issuer, the Parent Guarantor and the other guarantors of the Notes are primarily holding companies with very limited
operations. Their only significant assets are the equity interests of their directly held subsidiaries. As a result, the Irish Issuer, the Parent Guarantor and the other guarantors of the Notes are
dependent primarily upon dividends and other payments from their subsidiaries to generate the funds necessary to meet their outstanding debt service and other obligations, and such dividends may be
restricted by law or the instruments governing their subsidiaries' indebtedness. Their subsidiaries may not generate sufficient cash from operations to enable the Issuers to make principal and
interest payments on their indebtedness, including the Notes. In addition, their subsidiaries are separate and distinct legal entities and, except for existing and future subsidiaries that are the
guarantors of the Notes, any payments of dividends, distributions, loans or advances to the
Issuers by their subsidiaries could be subject to legal and contractual restrictions on dividends. In addition, payments to the Issuers by their subsidiaries will be contingent upon their
subsidiaries' earnings. Additionally, we may be limited in our ability to cause any existing or future joint ventures to distribute their earnings to us. We cannot assure you that agreements governing
the current and future indebtedness of our subsidiaries will permit those subsidiaries to provide the Issuers with sufficient cash to fund payments of principal, premiums, if any, and interest on the
Notes when due. In the event that the Issuers do not receive distributions or other payments from their subsidiaries, they may be unable to make required payments on the Notes.
The Notes and the guarantees are effectively subordinated to our and our guarantors' existing and
future secured indebtedness.
The Notes and the guarantees are unsecured obligations of the Issuers and each guarantor, respectively, and are effectively
subordinated to all of the Issuers' and each guarantor's existing and future secured indebtedness and other secured obligations to the extent of the value of the assets securing such indebtedness and
other obligations. As a result, in the event of any liquidation, insolvency, dissolution, reorganization or similar proceeding relating to us or our property, holders of any secured indebtedness of
ours will have claims that are prior to the claims of any noteholder with respect to the assets securing such secured indebtedness. Giving pro forma effect to this offering and the issuance of the AIG
Notes, as of March 31, 2015, the Issuers and the guarantors had $21.6 billion of indebtedness outstanding, of which approximately $2.9 billion was secured.
If
we defaulted on our obligations under any of our secured debt, our secured lenders would be entitled to foreclose on our assets securing that indebtedness and liquidate those assets.
If any secured indebtedness were to be accelerated, we cannot assure you that our assets would be sufficient to repay in full that indebtedness and our other indebtedness, including amounts due on the
Notes. In addition, upon any distribution of assets pursuant to any liquidation, insolvency, dissolution, reorganization or similar proceeding, the holders of our secured indebtedness will be entitled
to receive payment in full from the proceeds of the collateral securing such secured indebtedness before the holders of the Notes will be entitled to receive any payment with respect thereto. As a
result, the holders of the Notes may
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recover
disproportionately less than the holders of secured indebtedness, and it is possible that there will be no assets from which claims of holders of the Notes can be satisfied or, if any assets
remain, that the remaining assets will be insufficient to satisfy those claims in full.
The
Indenture contains a covenant that provides, subject to certain exceptions, that we must secure the Notes equally and ratably with certain secured indebtedness that we or our
restricted subsidiaries issue, assume or guarantee in the event that the amount of such secured indebtedness exceeds 12.5% of our consolidated net tangible assets, as defined in the Indenture, as
shown on or derived from our most recent quarterly or annual consolidated balance sheet. If this covenant is triggered, we would be obligated to secure the Notes equally and ratably with such other
secured indebtedness. As equally and ratably secured parties, holders of the Notes would no longer be effectively subordinated to the other equally and ratably secured indebtedness. The value of the
collateral securing our obligations to the holders of the Notes and to the other secured holders, however, could be insufficient to repay the holders of the Notes and the other secured holders in
full. To the extent of any insufficiency in the value of such collateral, holders of the Notes would have unsecured claims ranking equally and ratably with unsecured creditors. As of March 31,
2015, we were able to incur approximately $3.4 billion of additional secured indebtedness (representing 12.5% of our consolidated net tangible assets as of such date) under this covenant
without triggering the requirement to secure the Notes equally and ratably with certain secured indebtedness that we or our restricted subsidiaries issue, assume or guarantee.
We
may be able to obtain secured financing without regard to the foregoing limit under the Indenture by doing so through unrestricted subsidiaries. Our indentures provide us with
significant flexibility to designate our subsidiaries (other than the Issuers and ILFC) as unrestricted and to invest in those unrestricted subsidiaries. We cannot predict, however, whether we would
be able to obtain any required consents so as to incur additional secured debt under our other bank credit facilities and indentures, which also limit our ability to incur secured indebtedness. See "Risks Related to Our
Substantial Indebtedness and the NotesTo Service Our Debt and Meet Our Other Cash Needs, We Will Require a Significant Amount of
Cash, Which May Not Be Available" and "Description of NotesCertain CovenantsRestrictions on Liens."
The Notes and the guarantees are structurally subordinated to all of the existing and future
liabilities, including trade payables, of our subsidiaries that are not, or do not become, guarantors of the Notes.
The Notes are not guaranteed by all of our subsidiaries. The Notes are guaranteed, jointly and severally, on a senior unsecured basis,
by the Parent Guarantor, AerCap Aviation Solutions B.V., AerCap Ireland Limited, ILFC and AerCap U.S. Global Aviation LLC. In the future, other restricted subsidiaries of the Parent
Guarantor may be required to guarantee the Notes. See "Description of NotesCertain CovenantsFuture Subsidiary Guarantors."
Our
subsidiaries that do not guarantee the Notes, including any subsidiaries that we designate as unrestricted, have no obligation, contingent or otherwise, to pay amounts due under the
Notes or to make any funds available to pay those amounts, whether by dividend,
distribution, loan or other payment. Claims of holders of the Notes will therefore be structurally subordinated to all of the existing and future liabilities, including trade payables, of any
non-guarantor subsidiary such that, in the event of an insolvency, liquidation, reorganization, dissolution or other winding-up of any subsidiary that is not a guarantor, all of that subsidiary's
creditors (including trade creditors) would be entitled to payment in full out of that subsidiary's assets before the holders of the Notes would be entitled to any payment.
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In
addition, our subsidiaries that provide, or will provide, guarantees of the Notes will be automatically released from those guarantees upon the occurrence of certain events, including
the designation of that subsidiary guarantor as an unrestricted subsidiary in accordance with the terms of the Indenture. The Indenture provides us with significant flexibility to designate our
subsidiaries (other than the Issuers and ILFC) as unrestricted subsidiaries. If any subsidiary guarantee is released, no holder of the Notes will have a claim as a creditor against that subsidiary,
and the indebtedness and other liabilities, including trade payables, of that subsidiary will be structurally senior to the claim of any holders of the Notes. See "Description
of NotesGuarantees."
As
of March 31, 2015, our subsidiaries that are not guarantors of the Notes (other than the Issuers) had total liabilities, including trade payables (but excluding intercompany
liabilities), of $13.0 billion and total assets (excluding intercompany receivables) of $20.3 billion. In addition, for the three months ended March 31, 2015, our subsidiaries
that are not guarantors generated $249.6 million, or 81%, of our consolidated net income, and $0.7 billion, or 52%, of our total revenues and other income.
The agreements governing our debt contain various covenants that impose restrictions on us that may
affect our ability to operate our business and to make payments on the Notes.
Our indentures, securitizations, term loan facilities, ECA guaranteed financings, revolving credit facilities, subordinated joint
venture agreements, other commercial bank financings, and other agreements governing our debt impose operating and financial restrictions on our activities that limit or prohibit our ability to, among
other things:
-
- incur additional indebtedness;
-
- create liens on assets;
-
- sell certain assets;
-
- make certain investments, loans, guarantees or advances;
-
- declare or pay certain dividends and distributions;
-
- make certain acquisitions;
-
- consolidate, amalgamate, merge, sell or otherwise dispose of all or substantially all of our assets;
-
- enter into transactions with our affiliates;
-
- change the business conducted by the borrowers and their respective subsidiaries;
-
- enter into a securitization transaction unless certain conditions are met; and
-
- access cash in restricted bank accounts.
The
agreements governing certain of our indebtedness also contain financial covenants, such as requirements that we comply with certain loan-to-value, interest coverage and leverage
ratios. These restrictions could impede our ability to operate our business by, among other things, limiting our ability to take advantage of financing, merger and acquisition and other corporate
opportunities.
Various
risks, uncertainties and events beyond our control could affect our ability to comply with these covenants and maintain these financial tests and ratios. Failure to comply with
any of the covenants in our existing or future financing agreements would result in a default under those agreements and under other agreements containing cross-default
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provisions.
Under these circumstances, we may have insufficient funds or other resources to satisfy all our obligations, including our obligations under the Notes.
Unrestricted subsidiaries generally will not be subject to any of the covenants in the Indenture and
we may not be able to rely on the cash flow or assets of those unrestricted subsidiaries to pay our indebtedness.
Subject to compliance with the restrictive covenants contained in the Indenture, the Issuers will be permitted to designate any of the
Parent Guarantor's subsidiaries (other than the Issuers and ILFC) as unrestricted subsidiaries. Any such subsidiaries would not be subject to the restrictive covenants in the Indenture and would be
able to engage in any of the activities that we and our restricted subsidiaries are prohibited or limited from doing under the terms of the Indenture. Accordingly, we may not be able to rely on the
cash flow or assets of any subsidiary we designate as unrestricted to pay any of our indebtedness, including the Notes, and any of the foregoing actions could reduce the amount of our assets that
would be available to satisfy your claims should we default on the Notes.
If an active trading market for the Notes develops, changes in our credit ratings or the debt
markets could adversely affect the market prices of the Notes.
If an active trading market for the Notes develops, the market price for the Notes will depend on many factors,
including:
-
- our credit ratings with major credit rating agencies;
-
- the number of potential buyers and level of liquidity of the Notes;
-
- the prevailing interest rates being paid by other companies similar to us;
-
- our results of operations, financial condition, liquidity and future prospects;
-
- the time remaining until the Notes mature; and
-
- the overall condition of the economy and the financial markets and the industry in which we operate.
The
condition of the financial markets and prevailing interest rates have fluctuated in the past and are likely to fluctuate in the future. Fluctuations could have an adverse effect on
the market prices of the Notes.
Credit
rating agencies also continually review their ratings for debt securities of companies that they follow, including us. Negative changes in our ratings, or in our outlook, would
likely have an adverse effect on the market prices of the Notes. One of the effects of any credit rating downgrade would be to increase our costs of borrowing in the future. In addition, if any credit
rating initially assigned to the Notes is subsequently lowered or withdrawn for any reason, you may not be able to resell your notes without a substantial discount or at all.
Because your right to require repurchase of the Notes is limited, the trading price of the Notes may
decline if we enter into a transaction that is not a change of control under the Indenture.
The term "Change of Control Triggering Event" under the Indenture is limited and does not include every event that might cause the
trading price of the Notes to decline. The right of the holders of the Notes to require the Issuers to repurchase the Notes upon a Change of Control Triggering Event may not preserve the value of the
Notes in the event of a highly
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leveraged
transaction, reorganization, merger or similar transaction. We could engage in many types of transactions, such as acquisitions, refinancings or recapitalizations, any of which could
substantially affect our capital structure and the value of the Notes but may not constitute a Change of Control Triggering Event that permits holders to require the Issuers to repurchase their notes.
See "Description of NotesRepurchase at the Option of HoldersChange of Control Triggering Event."
The Issuers may not be able to repurchase the Notes upon a change of control triggering event.
Upon the occurrence of a Change of Control Triggering Event, as defined in the Indenture, each holder of notes has the right to require
the Issuers to repurchase all or any part of such holder's notes at a price equal to 101% of their principal amount, plus accrued and unpaid interest, if any, to, but not including, the date of
repurchase. If we experience a Change of Control Triggering Event, we cannot assure you that the Issuers would have sufficient financial resources available to satisfy their obligations to repurchase
the Notes. The Issuers' failure to repurchase the Notes as required under the Indenture would result in a default under the Indenture, which could result in defaults under the instruments governing
our other indebtedness, including the acceleration of the payment of any borrowings thereunder, and have material adverse consequences for us and the holders of the Notes. See
"Description of NotesRepurchase at the Option of HoldersChange of Control Triggering Event."
Holders of the Notes may not be able to determine when a change of control giving rise to their
right to have the Notes repurchased has occurred following a sale of "substantially all" of our assets.
A Change of Control Triggering Event, as defined in the Indenture, gives each holder of notes the right to require the Issuers to make
an offer to repurchase all or any part of such holder's notes. One of the circumstances under which a change of control, which is a condition to a Change of Control Triggering Event, may occur is upon
the sale or disposition of "all or substantially all" of our and our restricted subsidiaries' assets. There is no precise established definition of the phrase "substantially all" under applicable law
and the interpretation of that phrase will likely depend upon particular facts and circumstances. Accordingly, the ability of a holder of notes to require the Issuers to repurchase its notes as a
result of a sale of less than all of our assets to another person is uncertain.
Credit ratings on the Notes may not reflect all risks.
Any credit ratings assigned to the Notes may not reflect the potential impact of all risks related to structure, market, additional
factors discussed above or incorporated by reference herein and other factors that may affect the value of the Notes. A credit rating is not a recommendation to buy, sell or hold securities and may be
revised, suspended or withdrawn by the rating agency at any time.
Federal and state fraudulent transfer laws may permit a court to void the Notes and any of the
guarantees, subordinate claims in respect of the Notes and require noteholders to return payments received from us or the guarantors and, if that occurs, you may not receive any payments on the Notes.
Federal and state fraudulent transfer and conveyance statutes may apply to the issuance of the Notes. Under federal bankruptcy law and
comparable provisions of state fraudulent transfer or conveyance laws, which may vary from state to state, the Notes could be voided as a fraudulent transfer or conveyance if (1) we issued the
Notes with the intent of hindering,
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delaying
or defrauding creditors or (2) we received less than reasonably equivalent value or fair consideration in return for issuing the Notes and, in the case of (2) only, one of the
following is also true at the time thereof:
-
- the applicable Issuer or the applicable guarantor were insolvent or rendered insolvent by reason of the issuance of the Notes;
-
- the issuance of the Notes left the applicable Issuer or the applicable guarantor with an unreasonably small amount of capital to carry
on business; or
-
- the applicable Issuer or the applicable guarantor intended to, or believed that the applicable Issuer or the applicable guarantor
would, incur debts beyond their ability to pay such debts as they mature.
Claims
described under subparagraph (1) above are generally described as intentional fraudulent conveyances, while those under subparagraph (2) above are constructive
fraudulent conveyances. A court would likely find that an Issuer did not receive reasonably equivalent value or fair consideration for the Notes if that Issuer did not substantially benefit directly
or indirectly from the issuance of the Notes. As a general matter, value is given for a transfer or an obligation if, in exchange for the transfer or obligation, property is transferred or antecedent
debt is secured or satisfied. To the extent that the fraudulent conveyance analysis turns on insolvency, as with a constructive fraudulent conveyance, the insolvency determination is an intensely
factual one, which is supposed to be conducted based on current conditions rather than with the benefit of hindsight. Generally, an entity would be considered insolvent if, at the time it incurred
indebtedness, insolvency was present based on one of three alternative tests described above. For purposes of evaluating solvency under the first of these tests, a court would evaluate whether the sum
of an entity's debts, including contingent liabilities in light of the probabilities of their incurrence, was greater than the fair saleable value of all its assets.
If
a court were to find that the issuance of the Notes was a fraudulent transfer or conveyance, the court could void the payment obligations under the Notes or subordinate the Notes to
presently existing and future indebtedness of ours, or require the holders of the Notes to repay any amounts received with respect to such notes. In the event of a finding that a fraudulent transfer
or conveyance occurred, you may not receive any repayment on the Notes.
Insolvency laws of Ireland, the Netherlands or other local insolvency laws may preclude holders of
the Notes from recovering payments due on the Notes and may not be as favorable to you as those of another jurisdiction with which you may be familiar.
The Irish Issuer and AerCap Ireland Limited, a guarantor, are incorporated, have their registered offices and conduct the
administration of their business in Ireland and are likely to have their center of main interests (within the meaning of the EU Insolvency Regulation) in Ireland. Consequently, the main insolvency
proceedings against the Irish Issuer and AerCap Ireland Limited, a guarantor, are likely to be commenced in Ireland
and based on Irish insolvency laws. Each of the Parent Guarantor and AerCap Aviation Solutions B.V. is incorporated under the laws of the Netherlands and has its statutory seat
(statutaire zetel) in the Netherlands, and is likely to have its center of main interests (within the meaning of the EU Insolvency Regulation) in the
Netherlands. Consequently, the main insolvency proceedings against the Parent Guarantor or AerCap Aviation Solutions B.V. would likely be initiated in the Netherlands. Secondary proceedings
could be initiated in one or more EU jurisdictions (with the exception of Denmark) in which the Issuers, the Parent Guarantor, AerCap Aviation Solutions B.V. or any other guarantor, as the case
may be, have an establishment. Dutch
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insolvency
laws may make it difficult or impossible to effect a restructuring which may limit the ability of the holders of the Notes to enforce their rights under the guarantee by the Parent
Guarantor (the "Parent Guarantee") and the guarantee by AerCap Aviation Solutions B.V. (the "AerCap Aviation Guarantee"). See "Irish Law
ConsiderationsInsolvency Under Irish Law" and "Dutch Law ConsiderationsInsolvency Under Dutch Law" for
a description of insolvency laws in Ireland and the Netherlands.
The Parent Guarantee and the guarantee by AerCap Aviation Solutions B.V. may be voidable
under Dutch fraudulent conveyance rules.
Dutch law contains specific provisions dealing with fraudulent transfer or conveyance both in and outside of bankruptcy: the so-called actio
pauliana provisions. The actio pauliana protects creditors against acts which are prejudicial to
them. A legal act performed by a debtor (including, without limitation, an agreement pursuant to which it guarantees the performance of the obligations of a third party and any other legal act having
similar effect) can be challenged in or outside bankruptcy of the relevant debtor and may be nullified by the liquidator in bankruptcy (curator) of the
relevant debtor or, outside bankruptcy, by any of the creditors of the relevant debtor, if: (i) the debtor performed such acts without a pre-existing legal obligation to do so
(onverplicht); (ii) the creditor concerned or, in the case of the debtor's bankruptcy, any creditor, was prejudiced as a consequence of the act;
and (iii) at the time the act was performed both the debtor and the counterparty to the transaction knew or should have known that one or more of its creditors (existing or future) would be
prejudiced, unless the act was entered into for no consideration (om niet), in which case such knowledge of the counterparty is not necessary for a
successful challenge on grounds of fraudulent transfer or conveyance. For certain types of transactions that are entered into within one year before (a) the declaration of the bankruptcy or
(b), outside bankruptcy, the moment the transaction is challenged by a creditor, as the case may be, the debtor and the counterparty to the transaction are legally presumed to have knowledge of the
fact that the transaction will prejudice the debtor's creditors (subject to evidence of the
contrary). In addition, the liquidator in bankruptcy of a debtor may nullify that debtor's performance of any due and payable obligation if (i) at the time of such performance the payee
(hij die betaling ontving) knew that a request for bankruptcy of that debtor had been filed, or (ii) the performance of the obligation was the
result of a consultation between the debtor and the payee with a view to give preference to the latter over the debtor's other creditors. If the granting of the Parent Guarantee or AerCap Aviation
Guarantee or any other transaction entered into by the Parent Guarantor or AerCap Aviation Solutions B.V. at any time in connection with the issuance of the Notes involves a fraudulent
conveyance that does not qualify for any valid defense under Dutch law, then the granting of the Parent Guarantee or the AerCap Aviation Guarantee or any such other transaction may be nullified. As a
result of a successful challenge, holders of the Notes may not enjoy the benefit of the Parent Guarantee or the AerCap Aviation Guarantee. In addition, under such circumstances, holders of the Notes
might be held liable for any damages incurred by prejudiced creditors of the Parent Guarantor or AerCap Aviation Solutions B.V. as a result of the fraudulent conveyance.
Dutch corporate benefit laws may adversely affect the validity and enforceability of the Parent
Guarantee or the AerCap Aviation Guarantee.
If a Dutch company, such as the Parent Guarantor or AerCap Aviation Solutions B.V., enters into a transaction (such as the
granting of the Parent Guarantee or the AerCap Aviation Guarantee), the relevant transaction may be nullified by the Dutch company or its liquidator in bankruptcy and, as a consequence, may not be
valid, binding and enforceable against it, if that transaction is not within the company's corporate objects and the other party to the
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transaction
knew or should have known this without independent investigation. In determining whether the granting of a guarantee or the giving of security is within the corporate objects of the
relevant company, a Dutch court would not only consider the text of the objects clause in the articles of association of the company but all relevant circumstances, including whether the company
derives certain commercial benefits from the transaction in respect of which the guarantee was granted and any indirect benefit derived by the relevant Dutch company as a consequence of the
interdependence of it with the group of companies to which it belongs and whether or not the subsistence of the relevant Dutch company is put at risk by conducting such transaction.
It
is unclear whether a transaction can be nullified for being a transgression of the corporate objects of a company if that transaction is expressly permitted according to the wording
of the objects clause in the articles of association of that company. In a recent decision a Dutch
court of appeal ruled that circumstances such as the absence of corporate benefit are in principle not relevant if the relevant transaction is expressly permitted according to the objects clause in
the articles of association of the company. However, there is no decision of the Dutch Supreme Court confirming this, and therefore there can be no assurance that a transaction which is expressly
permitted according to the objects clause in the articles of association of a company cannot be nullified for being a transgression of the corporate objects of that company. The objects clauses in the
articles of association of the Parent Guarantors and AerCap Aviation Solutions B.V. include providing security for debts of legal entities and other companies.
If
the Parent Guarantee or the AerCap Aviation Guarantee or any other guarantee of the notes were held to be unenforceable, it could adversely affect your ability to collect any amounts
you are owed in respect of the Notes or the guarantees.
Irish corporate benefit laws may adversely affect the validity and enforceability of the AerCap
Ireland Limited guarantee.
The Notes are guaranteed by AerCap Ireland Limited, to the extent that such guarantee would not constitute the giving of unlawful
financial assistance within the meaning of Section 60 of the Companies Act 1963 (as amended) or Section 82 of the Companies Act 2014 (as applicable). There is a risk under Irish law that
a guarantee may be challenged as unenforceable on the basis that there is an absence of corporate benefit on the part of the relevant guarantor or that it is not for the purpose of carrying on the
business of the relevant guarantor. Where a guarantor is a direct or indirect holding company of an issuer, there is less risk of an absence of a corporate benefit on the basis that the holding
company could justify the decision to give a guarantee to protect or enhance its investment in its direct or indirect subsidiary. Where a guarantor is a direct or indirect subsidiary of an issuer or
is a member of the group with a common direct or indirect holding company, there is a greater risk of the absence of the corporate benefit. In the case of an Irish guarantor, the Irish courts have
held that corporate benefit may be established where the benefit flows to the group generally rather than specifically to the relevant Irish guarantor.
U.S. investors in the Notes may have difficulties enforcing certain civil liabilities against us or
our executive officers, some of our directors and some of our named experts in the United States.
The Parent Guarantor is a public limited liability company (naamloze vennootschap
or N.V.) incorporated under the laws of the Netherlands and the Irish Issuer is an entity incorporated and organized under the laws of Ireland. The rights of
investors in the Notes under the laws of the Netherlands or Ireland may differ from the rights of investors in
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companies
incorporated in other jurisdictions. Some of the named experts referred to in this prospectus are not residents of the United States, and most of our directors and our executive officers and
most of our assets and the assets of our directors are located outside the United States. As a result, you may not be able to serve process on us or on such persons in the United States or obtain or
enforce judgments from U.S. courts against them or us based on the civil liability provisions of the securities laws of the United States. There is doubt as to whether the courts of the Netherlands or
Ireland would enforce certain civil liabilities under U.S. securities laws in original actions and enforce claims for punitive damages.
Under
our articles of association, we indemnify and hold our directors, officers and employees harmless against all claims and suits brought against them, subject to limited exceptions.
Under our articles of association, to the extent allowed by law, the rights and obligations among or between us, any of our current or former directors, officers and employees and any current or
former shareholder shall be governed exclusively by the laws of the Netherlands and subject to the jurisdiction of the Netherlands courts, unless such rights or obligations do not relate to or arise
out of their capacities listed above. Although there is doubt as to whether U.S. courts would enforce such provision in an action brought in the United States under U.S. securities laws, such
provision could make judgments obtained outside of the Netherlands more difficult to enforce against our assets in the Netherlands or jurisdictions that would apply Netherlands law.
For
more information, see "Irish Law ConsiderationsEnforcement of Civil Liability Judgments Under Irish Law" and "Dutch Law ConsiderationsEnforcement of Civil
Liability Judgments Under Dutch Law."
Enforcing your rights as an investor in the Notes or under the guarantees across multiple
jurisdictions may be difficult.
The Notes are guaranteed by certain of our subsidiaries which are organized under the laws of Ireland, the Netherlands and the United
States. In the event of bankruptcy, insolvency or a similar event, proceedings could be initiated in any of these jurisdictions or in the jurisdiction of organization of a future guarantor. Your
rights under the Notes and the guarantees will be subject to the laws of several jurisdictions and you may not
be able to enforce effectively your rights in multiple bankruptcy, insolvency and other similar proceedings. Moreover, such multi-jurisdictional proceedings are typically complex and costly for
creditors and often result in substantial uncertainty and delay in the enforcement of creditors' rights.
In
addition, the bankruptcy, insolvency, foreign exchange, administration and other laws of the various jurisdictions in which the Irish Issuer and the guarantors are located may be
materially different from or in conflict with one another and those of the United States, including in respect of creditors' rights, priority of creditors, the ability to obtain post-petition interest
and the duration of the insolvency proceeding. The consequences of the multiple jurisdictions involved in the transaction could trigger disputes over which jurisdiction's law should apply and choice
of law disputes which could adversely affect your ability to enforce their rights and to collect payment in full under the Notes and the guarantees.
The Notes may be subject to Irish withholding tax.
On the date of this prospectus supplement, the Notes have not been admitted to the Official List of the Irish Stock Exchange. While we
will use our reasonable efforts to cause the Notes to be admitted to the Official List of the Irish Stock Exchange, we cannot assure you that the Notes will be admitted to the Official List of the
Irish Stock Exchange and to trading
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on
its Global Exchange Market, or if listed, that such listing will be maintained for the term of the Notes. If the Notes are not listed on a "recognized stock exchange" (such as the Irish Stock
Exchange) within the meaning of Section 64 of the TCA 1997 or any of the other conditions in Section 64 of the TCA are not met on or prior to the first interest payment date in respect
of the Notes, then the Irish Issuer will be required to deduct withholding tax (currently at the rate of 20%) from payments of interest on the Notes, unless the interest is paid in the ordinary course
of the Irish Issuer's business, the Irish Issuer can identify the holders of the Notes, and the holders of the Notes are (1) companies that are resident in a Relevant Territory (where a
Relevant Territory is a Member State of the EU other than Ireland or a country with which Ireland has a double taxation agreement) that (i) imposes a tax that generally applies to interest
receivable in that Relevant Territory by companies from sources outside that Relevant Territory or (ii) where the interest payable is exempted from the charge to Irish income tax under the
terms of a double tax agreement that is either in force or will come into force once all ratification procedures have been completed, provided that in the case of either (i) or (ii), the
interest is not paid in connection with an Irish branch or agency of the noteholders, or (2) another exemption from Irish withholding tax applies.
If
the Notes are successfully listed on the Irish Stock Exchange, but subsequently it becomes impracticable or unduly burdensome for us to maintain such a listing, then (following
consultation with the underwriters) we will use our reasonable efforts to cause the Notes to be listed on another "recognized stock exchange", as we may decide. If the Notes are not listed on a
"recognized stock exchange," however, on any interest payment date in respect of the Notes, the Irish Issuer will be required to deduct withholding tax otherwise than as set out above. See
"Certain Irish, Netherlands, and U.S. Federal Income Tax ConsequencesCertain Irish Tax Consequences" for a further discussion of the Irish
tax consequences with respect to the Notes.
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USE OF PROCEEDS
We intend to use the net proceeds of this offering of approximately $991,750,000, after deducting underwriting discounts, but before
deducting expenses of this offering, to acquire, invest in, finance or refinance aircraft assets, to repay indebtedness and for other general corporate purposes.
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Table of Contents
CAPITALIZATION
The following table sets forth our cash and cash equivalents and capitalization as of March 31, 2015, on an actual basis and on
an as adjusted basis to give effect to (1) this offering and (2) the Share Repurchase and consideration paid to the Selling Shareholder for the Share Repurchase consisting of
(a) the issuance of the AIG Notes and (b) the payment of $250 million in cash.
This
information is unaudited and should be read in conjunction with our financial statements and related notes incorporated by reference into this prospectus supplement.
Our
debt to equity ratio was 3.2 to 1 as of March 31, 2015. After giving pro forma effect to this offering, the Share Repurchase and the related issuance of the AIG Notes, our
debt to equity ratio would have been 3.5 to 1. Our debt to equity ratio is obtained by dividing adjusted net debt by adjusted shareholders' equity. Adjusted net debt means consolidated total debt less
cash and cash equivalents, and less a 50% equity credit with respect to $1.0 billion of subordinated debt as of March 31, 2015 and with respect to $1.5 billion of subordinated
debt as adjusted to give effect to the issuance of the AIG Notes. Adjusted shareholders' equity means total shareholders' equity, plus the 50% equity credit. Adjusted net debt and adjusted
shareholders' equity are non-GAAP financial measures.
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Table of Contents
|
|
|
|
|
|
|
|
(U.S. dollars in thousands)
|
|
Actual |
|
As Adjusted |
|
Cash and cash equivalents (1) |
|
$ |
1,594,018 |
|
$ |
2,335,368 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated debt |
|
|
|
|
|
|
|
Secured |
|
|
|
|
|
|
|
Export credit facilities |
|
|
2,476,280 |
|
|
2,476,280 |
|
Senior secured notes |
|
|
2,550,000 |
|
|
2,550,000 |
|
Institutional secured term loans |
|
|
3,317,150 |
|
|
3,317,150 |
|
ALS II debt |
|
|
295,929 |
|
|
295,929 |
|
AerFunding revolving credit facility (6) |
|
|
872,591 |
|
|
872,591 |
|
AeroTurbine revolving credit agreement (7) |
|
|
315,567 |
|
|
315,567 |
|
Other secured debt |
|
|
2,770,980 |
|
|
2,770,980 |
|
Boeing 737-800 pre-delivery payment facility (8) |
|
|
151,594 |
|
|
151,594 |
|
Fair value adjustment |
|
|
258,580 |
|
|
258,580 |
|
|
|
|
|
|
|
|
|
TOTAL SECURED |
|
|
13,008,671 |
|
|
13,008,671 |
|
|
|
|
|
|
|
|
|
Unsecured |
|
|
|
|
|
|
|
Unsecured Notes |
|
|
|
|
|
|
|
ILFC Legacy Notes (2) |
|
$ |
11,230,020 |
|
$ |
11,230,020 |
|
AerCap Aviation Notes |
|
|
300,000 |
|
|
300,000 |
|
AerCap Trust & AerCap Ireland Capital Limited Notes |
|
|
3,400,000 |
|
|
4,400,000 |
|
Unsecured Revolving Credit Facility |
|
|
|
|
|
|
|
DBS revolving credit facility (3) |
|
|
300,000 |
|
|
300,000 |
|
Citi revolving credit facility (4) |
|
|
|
|
|
|
|
AIG revolving credit facility (5) |
|
|
|
|
|
|
|
Other unsecured debt |
|
|
47,063 |
|
|
47,063 |
|
Fair value adjustment |
|
|
906,834 |
|
|
906,834 |
|
|
|
|
|
|
|
|
|
TOTAL UNSECURED |
|
|
16,183,917 |
|
|
17,183,917 |
|
|
|
|
|
|
|
|
|
Subordinated |
|
|
|
|
|
|
|
ECAPs subordinated notes |
|
|
1,000,000 |
|
|
1,000,000 |
|
Subordinated debt joint ventures partners |
|
|
64,280 |
|
|
64,280 |
|
AIG Notes (9) |
|
|
|
|
|
500,000 |
|
Fair value adjustment |
|
|
(237 |
) |
|
(237 |
) |
|
|
|
|
|
|
|
|
TOTAL SUBORDINATED |
|
|
1,064,043 |
|
|
1,564,043 |
|
|
|
|
|
|
|
|
|
Total consolidated debt |
|
$ |
30,256,631 |
|
$ |
31,756,631 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Equity (10) |
|
|
8,268,639 |
|
|
7,518,639 |
|
|
|
|
|
|
|
|
|
Total Capitalization |
|
$ |
38,525,270 |
|
$ |
39,275,270 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- (1)
- Increase
in cash relates to the $991.4 million of estimated net proceeds from this offering, net of debt issuance expenses, partially offset by the
$250 million of cash used to partially fund the Share Repurchase. See "Prospectus SummaryRecent Developments".
- (2)
- As
of March 31, 2015, we had an aggregate outstanding principal amount of senior unsecured notes of approximately $11.2 billion that were
issued by ILFC prior to the ILFC Transaction (the "ILFC Legacy Notes").
- (3)
- As
of March 31, 2015, the DBS revolving credit facility was fully drawn.
- (4)
- As
of March 31, 2015, the Citi revolving credit facility was undrawn, with $3.0 billion available under the facility.
- (5)
- As
of March 31, 2015, the AIG revolving credit facility was undrawn, with $1.0 billion available under the facility. Upon the issuance of the
AIG Notes, the amount available under the AIG revolving credit facility was reduced to $500 million.
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Table of Contents
- (6)
- As
of March 31, 2015, approximately $1.3 billion was undrawn under this facility.
- (7)
- As
of March 31, 2015, approximately $234.4 million was undrawn under this facility.
- (8)
- As
of March 31, 2015, approximately $48.7 million was undrawn under this facility.
- (9)
- For
more information regarding the AIG Notes issued to the Selling Shareholder in connection with the Share Repurchase, see "Prospectus
SummaryRecent Developments"
- (10)
- As
adjusted shareholders' equity reflects the consummation of the Share Repurchase.
S-21
Table of Contents
RATIO OF EARNINGS TO FIXED CHARGES
For purposes of calculating the ratio of earnings to fixed charges, earnings consist of income from continuing operations before income
taxes, income of investments accounted for under the equity method and non-controlling interests plus amortization of capitalized interest and fixed charges (excluding capitalized interest). Fixed
charges consist of interest incurred (whether expensed or capitalized), amortization of debt expense and that portion of rental expense on operating leases deemed to be the equivalent of interest. The
following table sets forth AerCap's ratio of earnings to fixed charges for each of the periods indicated.
AerCap Holdings N.V. and Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
Three
Months Ended
March 31,
2015 |
|
|
|
2010 |
|
2011 |
|
2012 |
|
2013 |
|
2014 |
|
Ratio of earnings to fixed charges |
|
|
2.04 |
|
|
1.77 |
|
|
1.54 |
|
|
2.32 |
|
|
2.00 |
|
|
2.19 |
|
S-22
Table of Contents
DESCRIPTION OF NOTES
General
Certain terms used in this Description of Notes are defined under the subheading "Certain
Definitions." In this description, (1) the term "Irish Issuer" refers to AerCap Ireland Capital Limited and not to any of its Affiliates, (2) the term "U.S.
Issuer" refers only to AerCap Global Aviation Trust and not to any of its Affiliates, (3) references to the "Issuers" refer only to the Irish Issuer and the U.S. Issuer and not to any of their
Affiliates, (4) the term "Holdings" refers to AerCap Holdings N.V. and (5) references to "we," "our" and "us" refer to Holdings and its consolidated subsidiaries.
The
4.250% senior notes due 2020 (the "2020 Notes") and the 4.625% senior notes due 2022 (the "2022 Notes" and, together with the 2020 Notes, the "Notes") will be issued under an
indenture dated as of May 14, 2014 (as supplemented by the Sixth Supplemental Indenture and the Seventh Supplemental Indenture, each dated as of the Issue Date (the "Indenture"), among the
Issuers, Holdings, each Subsidiary of Holdings listed as a guarantor under "Guarantees" below (the "Subsidiary Guarantors" and, together
with Holdings, the "Guarantors") and Wilmington Trust, National Association, as trustee (the "Trustee"). The following summary of certain provisions of the Notes and the Indenture does not purport to
be complete and is subject to, and is qualified in its entirety by reference to, the Notes and the Indenture, including the definitions of certain terms contained therein.
The
Notes will be issued only in fully registered book-entry form without coupons only in minimum denominations of $150,000 and integral multiples of $1,000 above that amount. The Notes
will be issued in the form of global notes. Global notes will be registered in the name of a nominee of DTC, New York, New York, as described under "Book-Entry, Delivery and
Form of Securities."
Listing
Application will be made to the Irish Stock Exchange for the Notes to be admitted to the Official List of the Irish Stock Exchange and
to trading on the Global Exchange Market of the Irish Stock Exchange. We cannot assure you that such listing will be granted or maintained.
The
Issuers are not and will not be regulated by the Central Bank of Ireland as a result of issuing the Notes. Any investment in the Notes does not have the status of a bank deposit and
is not within the scope of the deposit protection scheme operated by the Central Bank of Ireland.
Paying Agent and Registrar for the Notes
The Issuers will maintain one or more paying agents and registrars for the Notes.
Principal Amount; Maturity and Interest
The 2020 Notes will be initially issued in an aggregate principal amount of $500,000,000 and will mature on July 1, 2020. The
2022 Notes will be initially issued in an aggregate principal amount of $500,000,000 and will mature on July 1, 2022.
Each
series of notes will bear interest at the applicable rate per annum shown on the front cover of this prospectus supplement, payable semiannually in arrears on January 1 and
July 1 of each year commencing on January 1, 2016 until full repayment of the outstanding principal amount of such series of notes. Interest will be payable to the holders of record on
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December 15
and June 15, as the case may be, immediately preceding such interest payment date, whether or not such day is a Business Day.
The
Notes will be denominated in U.S. dollars and all payments of principal and interest thereon will be paid in U.S. dollars. Interest on the Notes of a series will accrue from the most
recent date on which interest has been paid or, if no interest has been paid, from and including the Issue Date. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day
months.
Additional Notes
The Issuers may, from time to time, without notice to or the consent of the holders, create and issue, pursuant to the Indenture and in
accordance with applicable laws and regulations, additional notes (the "Additional Notes") of any series of notes maturing on the same maturity date as the other notes of that series and having the
same terms and conditions under the Indenture (including with respect to the Guarantors and the Guarantees) as the then Outstanding notes of that series in all respects (or in all respects except for
the issue date and the amount and the date of the first payment of interest thereon) so that such Additional Notes shall be consolidated and form a single class with the
Outstanding notes of that series for all purposes under the Indenture, including with respect to waivers, amendments, redemptions and offers to purchase; provided that, if the Additional Notes are not
fungible with such series of notes for U.S. federal income tax purposes, the Additional Notes will have a
separate CUSIP, ISIN, or other identifying number. Additional Notes, if any, will be the subject of a separate prospectus supplement.
Ranking
The Notes and the Guarantees thereof will rank pari passu in right of payment with all
existing and future senior indebtedness of the relevant Issuer or the relevant Guarantor, as the case may be.
The
Notes will be effectively subordinated to all of the Issuers' and each Guarantor's existing and future secured indebtedness and other secured obligations to the extent of the value
of the assets securing such indebtedness and other obligations. Giving pro forma effect to this offering, the issuance of the AIG Notes and the AIG Revolver Reduction as of March 31, 2015, the
principal amount of outstanding indebtedness of Holdings and its subsidiaries, which excludes fair value adjustments of $1.2 billion, would have been approximately $30.6 billion, of
which approximately $12.8 billion was secured, and Holdings and its subsidiaries had total unused lines of credit of approximately $5.1 billion.
The
Notes will be structurally subordinated to all of the existing and future indebtedness and other liabilities (including trade payables) of each Subsidiary of Holdings (other than the
Issuers) that does not guarantee the Notes. As of March 31, 2015, these non-Guarantor Subsidiaries had total liabilities, including trade payables (but excluding intercompany liabilities), of
$13.0 billion and total assets (excluding intercompany receivables) of $20.3 billion. In addition, for the three months ended March 31, 2015, these non-Guarantor Subsidiaries
generated $249.6 million, or 81%, of our consolidated net income, and $0.7 billion, or 52%, of our total revenues and other income.
Guarantees
The Notes and all obligations under the Indenture will be initially guaranteed, jointly and severally, on a senior unsecured basis, by
Holdings, AerCap Aviation Solutions B.V., AerCap Ireland Limited, ILFC and AerCap U.S. Global Aviation LLC. In addition, in the future, other
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Restricted
Subsidiaries of Holdings may be required to guarantee the Notes. See "Certain CovenantsFuture Subsidiary
Guarantors."
In
addition, the obligations of each Guarantor (other than any Guarantor that is a direct or indirect parent of the Irish Issuer) under its Guarantee will be limited to the extent
necessary to prevent such Guarantee from constituting a fraudulent conveyance or transfer under applicable law (or to ensure compliance with legal restrictions with respect to distributions or the
provision of other benefits to direct or indirect shareholders) or as necessary to recognize certain defenses generally available to guarantors, including voidable preference, financial assistance,
corporate purpose, capital maintenance or similar laws, regulations or defenses affecting the rights of creditors generally or other considerations under applicable law. See
"Irish Law ConsiderationsInsolvency Under Irish Law" and "Dutch Law ConsiderationsInsolvency Under
Dutch Law."
A
Guarantee by a Subsidiary Guarantor shall provide by its terms that it shall be automatically and unconditionally released and discharged upon:
- (1)
- (a) any
sale, exchange, disposition or transfer (including through consolidation, amalgamation, merger or otherwise) of (x) the Capital
Stock of such Subsidiary Guarantor, after which such Subsidiary Guarantor is no longer a Restricted Subsidiary, or (y) all or substantially all the assets of such Subsidiary Guarantor;
- (b)
- other
than with respect to each Subsidiary Guarantor that is a party to the Indenture on the date of the indenture, the release, discharge or termination of
the guarantee by such Subsidiary Guarantor that resulted in the obligation of such Subsidiary Guarantor to guarantee the Notes, except a release, discharge or termination by or as a result of payment
under such guarantee;
- (c)
- the
permitted designation of any Restricted Subsidiary that is a Subsidiary Guarantor as an Unrestricted Subsidiary;
- (d)
- the
consolidation, amalgamation or merger of any Subsidiary Guarantor with and into an Issuer or another Guarantor that is the surviving Person in such
consolidation, amalgamation or merger, or upon the liquidation of such Subsidiary Guarantor following the transfer of all of its assets to an Issuer or another Guarantor; or
- (e)
- the
Issuers exercising their legal defeasance option or covenant defeasance option as described under "Legal Defeasance
and Covenant Defeasance" or the Issuers' obligations under the Indenture being discharged as described under "Satisfaction and
Discharge"; and
- (2)
- if
evidence of such release and discharge is requested to be executed by the Trustee, the Irish Issuer delivering, or causing to be delivered, to the
Trustee an Officers' Certificate and an opinion of counsel, each stating that all conditions precedent provided for in the Indenture relating to such transaction and to the execution of such evidence
by the Trustee have been complied with.
Additional Amounts
We are required to make all our payments under or with respect to the Notes and each Guarantee free and clear of and without
withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including penalties, interest and other liabilities related
thereto) (hereinafter "Taxes") imposed or levied by or on behalf of (i) Ireland or any political subdivision or any authority or agency therein or thereof having power to tax, (ii) any
other jurisdiction in which we are organized or are
S-25
Table of Contents
otherwise
resident for tax purposes or any political subdivision or any authority or agency therein or thereof having the power to tax, (iii) any jurisdiction from or through which payment on
the Notes or any Guarantee or any political subdivision or any authority or agency therein or thereof having the power to tax is made or (iv) any jurisdiction in which a Guarantor that actually
makes a payment on the Notes or its Guarantee is organized or otherwise considered
to be a resident for tax purposes, or any political subdivision or any authority or agency therein or thereof having the power to tax (each a "Relevant Taxing Jurisdiction"), unless we are required to
withhold or deduct Taxes by law or by the interpretation or administration thereof.
If
we are so required to withhold or deduct any amount for or on account of Taxes imposed by a Relevant Taxing Jurisdiction from any payment made under or with respect to the Notes or
any Guarantee, we will be required to pay such additional amounts ("Additional Amounts") as may be necessary so that the net amount received by you (including Additional Amounts) after such
withholding or deduction will not be less than the amount you would have received if such Taxes had not been withheld or deducted; provided, however, that
the foregoing obligation to pay Additional Amounts does not apply to (1) any Taxes that would not have been so imposed but for the
existence of any present or former connection between the relevant holder (or between a fiduciary, settlor, beneficiary, member or shareholder of, or possessor of power over, the relevant holder, if
the relevant holder is an estate, nominee, trust or corporation) and the Relevant Taxing Jurisdiction (including being a citizen or resident or national of, or carrying on a business or maintaining a
permanent establishment in, or being physically present in, the Relevant Taxing Jurisdiction, but other than a connection arising from the acquisition, ownership or holding of such note or the receipt
of any payment in respect thereof); (2) any estate, inheritance, gift, sales, value added, excise, transfer, personal property tax or similar tax, assessment or governmental charge;
(3) any Taxes imposed as a result of the failure of the relevant holder or beneficial owner of the Notes to comply with a timely request in writing of any Issuer addressed to the holder or
beneficial owner, as the case may be (such request being made at a time that would enable such holder or beneficial owner acting reasonably to comply with that request), to provide information
concerning such holder's or beneficial owner's nationality, residence, identity or connection with any Relevant Taxing Jurisdiction, if and to the extent that due and timely compliance with such
request under applicable law, regulation or administrative practice would have reduced or eliminated such Taxes with respect to such holder or beneficial owner, as applicable; (4) any Taxes
that are payable other than by deduction or withholding from a payment of the principal of, premium, if any, or interest, if any, on the Notes; (5) any Taxes that are required to be deducted or
withheld on a payment to an individual and that are required to be made pursuant to Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meeting of
November 26-27, 2000 on taxation of savings income or any law implementing or complying with, or introduced in order to conform to such Directives; or (6) any Taxes withheld or deducted
pursuant to Sections 1471 through 1474 of the Internal Revenue Code (or any amended or successor version of such Sections), any U.S. Treasury regulations promulgated thereunder, any official
interpretations thereof or any agreements or treaties (including any law implementing any such agreement or treaty) entered into in connection with the implementation thereof; nor will we pay
Additional Amounts (a) if the payment could have been made without such deduction or withholding if the beneficiary of the payment had presented the note for payment (where presentation is
permitted or required for payment) within 30 days after the date on which such payment or such note became due and payable or the date on which payment thereof is duly provided for, whichever
is later, (b) with respect to any payment of principal of (or premium, if any, on) or interest on such note to any holder who is a fiduciary or partnership or any Person other
S-26
Table of Contents
than
the sole beneficial owner of such payment, to the extent that a beneficiary or settlor with respect to such fiduciary, a member of such a partnership or the beneficial owner of such payment would
not have been entitled to the Additional Amounts had such beneficiary, settlor, member or beneficial owner been the actual holder of such note, or (c) in respect of any note where such
withholding or deduction is imposed as a result of any combination of clauses (1), (2), (3), (4), (5), (6), (a), (b) and (c) of this paragraph.
We
will make any required withholding or deduction and remit the full amount deducted or withheld to the Relevant Taxing Jurisdiction in accordance with applicable law. We will provide
the Trustee, for the benefit of the holders, with official receipts evidencing the payment of the Taxes with respect to which Additional Amounts are paid. If, notwithstanding our efforts to obtain
such receipts, the same are not obtainable, we will provide the Trustee with other evidence. In no event, however, shall we be required to disclose any information that we reasonably deem to be
confidential.
If
we are or will become obligated to pay Additional Amounts under or with respect to any payment made on the Notes or any Guarantee, at least 30 days prior to the date of such
payment, we will deliver to the Trustee an Officers' Certificate stating that Additional Amounts will be payable and the amount so payable and such other information necessary to enable the paying
agent to pay Additional Amounts to holders on the relevant payment date. Whenever in the Indenture there is mentioned, in any context:
- (1)
- the
payment of principal or interest;
- (2)
- redemption
prices or purchase prices in connection with a redemption or purchase of notes; or
- (3)
- any
other amount payable on or with respect to any of the Notes or any Guarantee;
such
reference shall be deemed to include payment of Additional Amounts as described under this heading to the extent that, in such context, Additional Amounts are, were or would be payable in respect
thereof.
We
will pay any present or future stamp, court or documentary taxes or any other excise, property or similar taxes, charges or levies that arise in any Relevant Taxing Jurisdiction from
the execution, delivery, enforcement or registration of the Notes, the Indenture, any Guarantee or any other document or instrument in relation thereof, and we will agree to indemnify the holders for
any such taxes paid by such holders. The obligations described under this heading will survive any termination, defeasance or discharge of the Indenture and will apply mutatis
mutandis to any jurisdiction in which any successor Person to the Irish Issuer or any Guarantor is organized or any political subdivision or taxing authority or agency thereof
or therein. For a discussion of Irish withholding taxes applicable to payments under or with respect to the Notes, see "Certain Irish, Netherlands, and U.S. Federal Income Tax
ConsequencesCertain Irish Tax Considerations."
Optional Redemption
At any time the Issuers may redeem all or part of the Notes, upon not less than 30 nor more than 60 days' prior notice mailed by
first class mail to each holder's registered address, or delivered electronically if held by DTC, at a redemption price equal to 100% of the principal amount of notes redeemed plus the Applicable
Premium and accrued and unpaid interest (and additional interest, if any), to, but not including, the redemption date, subject to the rights of holders of record on the relevant record date to receive
interest due on the relevant interest payment date. In the event of a partial redemption of the Notes, the Trustee shall
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select
the Notes to be redeemed in the manner described under "Repurchase upon a Change of Control Triggering EventSelection and
Notice."
Any
redemption or notice of any redemption may, at the Issuers' discretion, be subject to one or more conditions precedent, including, but not limited to, completion of any debt or
equity financing, acquisition or other corporate transaction or event, and, at the Issuers' discretion, the redemption date may be delayed until such time as any or all of such conditions have been
satisfied. In addition, the Issuers may provide in any notice of redemption that payment of the redemption price and the performance of their obligations with respect to such redemption may be
performed by another Person; provided, however, that the Issuers will remain obligated to pay the redemption price and perform their obligations with
respect to such redemption in the event such other Person fails to do so.
In
addition to the Issuers' right to redeem notes as set forth above, the Issuers may at any time and from time to time purchase notes pursuant to open-market transactions, tender offers
or otherwise.
Redemption for Changes in Withholding Taxes
We are entitled to redeem the Notes, at our option, at any time in whole but not in part, upon not less than 30 nor more than
60 days' notice (which notice shall be irrevocable) to the holders mailed by first-class mail to each holder's registered address, or delivered electronically if held by DTC, at 100% of the
principal amount thereof, plus accrued and unpaid interest (and additional interest, if any), to the date of redemption (subject to the right of holders of record on the relevant record date to
receive interest due on the relevant interest payment date), in the event we have become or would become obligated to pay, on the next date on which any amount would be payable with respect to the
Notes, any Additional Amounts as a result of:
- (1)
- a
change in or an amendment to the laws (including any regulations, protocols or rulings promulgated and treaties enacted thereunder) of any Relevant Taxing
Jurisdiction affecting taxation; or
- (2)
- any
change in or amendment to, or the introduction of, any official position regarding the application, administration or interpretation of such laws,
regulations, treaties or rulings (including a holding, judgment or order by a court of competent jurisdiction),
which
change or amendment is announced or becomes effective on or after the date of this prospectus supplement and we cannot avoid such obligation by taking reasonable measures available to us.
Notwithstanding the foregoing, no such notice of redemption will be given (i) earlier than 90 days prior to the earliest date on which we would be obliged to make such payment of
Additional Amounts and (ii) unless at the time such notice is given, such obligation to pay such Additional Amounts remains in effect.
Before
we publish or mail or deliver notice of redemption of the Notes as described above, the Irish Issuer will deliver to the Trustee an Officers' Certificate stating that we cannot
avoid
our obligation to pay Additional Amounts by taking reasonable measures available to us and that all conditions precedent to the redemption have been complied with. The Irish Issuer will also deliver
an opinion of outside counsel stating that we would be obligated to pay Additional Amounts as a result of a change in tax laws or regulations or a new application or interpretation of such laws or
regulations and that all conditions precedent to the redemption have been complied with.
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The
foregoing will apply mutatis mutandis to any jurisdiction in which any successor Person to an Issuer or a Guarantor is incorporated or
organized or any political subdivision or taxing authority or agency thereof or therein.
Repurchase Upon a Change of Control Triggering Event
Change of Control Triggering Event
If a Change of Control Triggering Event occurs, the Issuers will make an offer to purchase all of the Notes pursuant to the offer
described below (the "Change of Control Offer") at a price in cash (the "Change of Control Payment") equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest (and
additional interest, if any), to, but not including, the date of purchase, subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest
payment date. Within 30 days following any Change of Control Triggering Event, the Issuers will send notice of such Change of Control Offer by first class mail, or delivered electronically if
held by DTC, with a copy to the Trustee, to each holder of notes to the address of such holder appearing in the security register or otherwise in accordance with the procedures of DTC, with the
following information:
- (1)
- a
Change of Control Offer is being made pursuant to the covenant entitled "Repurchase upon a Change of Control Triggering
EventChange of Control Triggering Event," and that all notes properly tendered pursuant to such Change of Control Offer will be accepted for payment;
- (2)
- the
purchase price and the purchase date, which will be no earlier than 30 days nor later than 60 days from the date such notice is mailed or
delivered (the "Change of Control Payment Date");
- (3)
- any
Note not properly tendered will remain Outstanding and continue to accrue interest;
- (4)
- unless
the Issuers default in the payment of the Change of Control Payment, all notes accepted for payment pursuant to the Change of Control Offer will
cease to accrue interest on, but not including, the Change of Control Payment Date;
- (5)
- the
instructions determined by the Issuers consistent with this covenant that a holder must follow in order to have its notes purchased or to cancel a
previous order of purchase; and
- (6)
- if
such notice is mailed or delivered prior to the occurrence of a Change of Control Triggering Event, stating the Change of Control Offer is conditional on
the occurrence of such Change of Control Triggering Event.
While
the Notes are in global form, when the Issuers make an offer to purchase all of the Notes pursuant to the Change of Control Offer, a holder may exercise its option to elect for the
purchase of the Notes through the facilities of DTC, subject to DTC's rules and regulations.
If
holders of not less than 90% in aggregate principal amount of the Outstanding notes of a series validly tender and do not withdraw such notes in a Change of Control Offer and the
Issuers, or any other Person making a Change of Control Offer in lieu of the Issuers as described below, purchase all of the Notes of such series validly tendered and not withdrawn
by such holders, the Issuers will have the right, upon not less than 30 nor more than 60 days' prior notice, given not more than 30 days following such purchase pursuant to the Change of
Control Offer described above, to redeem all notes of such series that remain Outstanding following such purchase at a redemption price in cash equal to 101% of the principal amount thereof, plus
accrued and unpaid interest (and additional interest, if any), to, but not including,
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the
date of redemption (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date).
The
Issuers will not be required to make a Change of Control Offer following a Change of Control Triggering Event if (1) a third party makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer made by the Issuers and purchases all notes validly tendered
and not withdrawn pursuant to such Change of Control Offer or (2) notice of redemption has been given pursuant to the Indenture as described under the caption
"Optional Redemption," unless and until there is a default in payment of the applicable redemption price. Notwithstanding anything to the
contrary herein, a Change of Control Offer may be made in advance of a Change of Control Triggering Event, conditional upon such Change of Control Triggering Event.
Notes
repurchased by us pursuant to a Change of Control Offer will have the status of notes issued but not Outstanding or will be retired and canceled at our option. Notes purchased by a
third party pursuant to the preceding paragraph will have the status of notes issued and Outstanding.
The
Issuers will comply with the requirements of Section 14(e) under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or
regulations are applicable in connection with the repurchase of the Notes pursuant to a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with
the provisions of the Indenture, the Issuers will comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations described in the Indenture by
virtue thereof.
On
the Change of Control Payment Date, the Issuers (or any Person making a Change of Control Offer in lieu of the Issuers) will, to the extent permitted by law,
- (1)
- accept
for payment all notes or portions thereof properly tendered pursuant to the Change of Control Offer,
- (2)
- deposit
with the paying agent an amount equal to the aggregate Change of Control Payment in respect of all notes or portions thereof so tendered, and
- (3)
- at
the option of the Issuers, unless a Person is making a Change of Control Offer in lieu of the Issuers, deliver, or cause to be delivered, to the Trustee
for cancellation the Notes so accepted together with an Officers' Certificate stating that such notes or portions thereof have been tendered to and purchased by the Issuers.
The
paying agent will promptly mail or otherwise deliver to each holder of the Notes the Change of Control Payment for such notes, and the Trustee, upon the Issuers' order, will promptly
authenticate and mail, or deliver electronically if held by DTC, to each holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each such
new Note will be in a minimum denomination of $150,000 and an integral multiple of $1,000 above that amount. The Issuers will
publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.
The
Change of Control Triggering Event purchase feature is a result of negotiations between the underwriters of the Notes and us. We have no present intention to engage in a transaction
that would trigger a Change of Control Offer, although it is possible that we could decide to do so in the future. Subject to the limitations discussed below, we could, in the future, enter into
certain transactions, including acquisitions, refinancings or other
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recapitalizations,
that would not constitute a Change of Control Triggering Event under the Indenture, but that could cause a change in effective control of Holdings or any of its subsidiaries,
increase the amount of indebtedness outstanding at such time or otherwise affect our capital structure or credit ratings. Except for the limitations contained in the Indenture covenants, the Indenture
will not contain any covenants or provisions that may afford holders of the Notes protection in a highly levered transaction.
The
Credit Agreement provides that the occurrence of certain change of control events (including a Change of Control as defined under the Indenture) with respect to us would constitute a
default thereunder. In the event a Change of Control occurs, we may seek the consent of our lenders or may attempt to refinance or repay the borrowings under the Credit Agreement. If we do not obtain
such consent or refinance or repay such borrowings, we may be in default under the Credit Agreement, which may, in turn, constitute a default under the Indenture. In addition, future indebtedness that
we may incur may contain prohibitions on the occurrence of certain events that would constitute a Change of Control or require the repurchase of such indebtedness upon a Change of Control. The
exercise by the holders of their right to require us to repurchase their notes could cause a default under such indebtedness, even if a Change of Control itself does not, due to the financial effect
of such repurchase on us. We cannot assure you that sufficient funds will be available when necessary to make any required repurchases.
The
definition of "Change of Control" includes a disposition of all or substantially all of the assets of Holdings and its Restricted Subsidiaries to certain Persons. Although there is a
limited body of case law interpreting the phrase "substantially all," there is no precise established definition of the phrase under applicable law. Accordingly, in certain circumstances there may be
a degree of uncertainty as to whether a particular transaction would involve a disposition of "all or substantially all" of the assets of Holdings. As a result, it may be unclear as to whether a
Change of Control has occurred and whether a holder of notes may require the Issuers to make an offer to repurchase the Notes as described above.
The
existence of a holder's right to require the Issuers to repurchase such holder's notes upon the occurrence of a Change of Control Triggering Event may deter a third party from
seeking to acquire Holdings or its subsidiaries in a transaction that would constitute a Change of Control.
The
provisions under the Indenture relative to our obligation to make an offer to repurchase the Notes as a result of a Change of Control Triggering Event may be waived or modified with
the written consent of the holders of a majority in principal amount of the Outstanding notes voting as a single group.
Notice
of repurchase, at the Issuers' option and discretion, may be subject to one or more conditions precedent, including, but not limited to, completion of such Change of Control, as
the case may be.
Selection and Notice
If less than all of the Notes of a particular series are to be redeemed or repurchased at any time, selection of such notes for
redemption or repurchase, will be made by the Trustee on a pro rata basis or by lot or otherwise in accordance with the procedures of DTC; provided that
no notes of $150,000 or less shall be purchased or redeemed in part.
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Notices of purchase or redemption shall be mailed by first class mail, postage prepaid, or delivered electronically if held by DTC, at least 30 but not more than
60 days before the purchase or redemption date to each holder of notes to be purchased or redeemed at such holder's registered address. If any Note is to be purchased or redeemed in part only,
any notice of purchase or redemption that relates to such Note shall state the portion of the principal amount thereof that has been or is to be purchased or redeemed. In the case of any book-entry
notes, notices of purchase or redemption will be given to DTC in accordance with its applicable procedures.
A
new Note in principal amount equal to the unpurchased or unredeemed portion of any Note purchased or redeemed in part will be issued in the name of the holder thereof upon cancellation
of the original Note. On and after the purchase or redemption date, unless the Issuers default in payment of the purchase or redemption price, interest shall cease to accrue on notes or portions
thereof purchased or called for redemption.
For
so long as the Notes are admitted to the Official List of the Irish Stock Exchange and to trading on the Global Exchange Market thereof and the guidelines of the Irish Stock Exchange
so require, the Issuers shall deliver, or cause to be delivered, notice of redemption to the Company Announcements Office in Dublin and, with respect to certificated notes only, mail such notice to
holders by first-class mail, postage prepaid, at their respective addresses as
they appear on the registration books of the registrar, in each case not less than 30 nor more than 60 days prior to the redemption date.
Certain Covenants
The Indenture contains the negative covenants summarized below.
Restrictions on Liens
The Indenture provides that Holdings will not, nor will it permit any Restricted Subsidiary to, issue, assume or guarantee any
indebtedness for borrowed money secured by any Lien upon any property of Holdings or any Restricted Subsidiary, or upon any shares of Capital Stock of any Restricted Subsidiary, without in any such
case effectively providing, concurrently with the issuance, assumption or guarantee of any such indebtedness for borrowed money, that the Notes (together with, if Holdings shall so determine, any
other indebtedness of Holdings or a Restricted Subsidiary ranking equally with the Notes then existing or thereafter created) shall be secured equally and ratably with such indebtedness for borrowed
money; provided, however, that the foregoing restrictions shall not apply to:
- (1)
- Liens
existing on the date of the Indenture;
- (2)
- Liens
to secure the payment of all or part of the purchase price of property (other than property acquired for lease to a Person other than Holdings or a
Restricted Subsidiary) upon the acquisition of such property by Holdings or a Restricted Subsidiary or to secure any indebtedness for borrowed money incurred or guaranteed by Holdings or a Restricted
Subsidiary prior to, at the time of or within 60 days after the latest of the acquisition, completion of construction or commencement of full operation of such property, which indebtedness for
borrowed money is incurred or guaranteed for the purpose of financing all or any part of the purchase price thereof or construction or improvements thereon; provided,
however, that in the case of any such acquisition, construction or improvement, the Liens shall not apply to any property theretofore owned by Holdings or a Restricted
Subsidiary, other than, in the case of any such construction or improvement, any theretofore unimproved real property on which the property so constructed, or the improvement, is located;
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- (3)
- Liens
on the property of a Restricted Subsidiary on the date it becomes a Restricted Subsidiary;
- (4)
- Liens
securing indebtedness for borrowed money of a Restricted Subsidiary owing to Holdings or to another Restricted Subsidiary;
- (5)
- Liens
on property of a Person existing at the time such Person is merged into or consolidated or amalgamated with Holdings or a Restricted Subsidiary or at
the time of a purchase, lease or other acquisition of the properties of a Person as an entirety or substantially as an entirety by Holdings or a Restricted Subsidiary;
- (6)
- bankers'
Liens arising by law or by contract in the ordinary and usual course of business of Holdings or any Restricted Subsidiary;
- (7)
- any
replacement or successive replacement in whole or in part of any Liens referred to in the foregoing clauses (1) to (6), inclusive; provided, however, that the principal amount of the indebtedness
for borrowed money secured by the Liens shall not be increased and the principal
repayment schedule and maturity of such indebtedness shall not be extended and (A) such replacement shall be limited to all or part of the property that secured the indebtedness for borrowed
money so replaced (plus improvements and construction on such property), or (B) if the property that secured the indebtedness for borrowed money so replaced has been destroyed, condemned or
damaged and pursuant to the terms of such indebtedness other property has been substituted therefor, then such replacement shall be limited to all or part of such substituted property;
- (8)
- Liens
created by or resulting from any litigation or other proceeding that is being contested in good faith by appropriate proceedings, including Liens
arising out of judgments or awards against Holdings or any Restricted Subsidiary with respect to which Holdings or such Restricted Subsidiary is, in good faith, prosecuting an appeal or proceedings
for review; or Liens incurred by Holdings or any Restricted Subsidiary for the purpose of obtaining a stay or discharge in the course of any litigation or other proceeding to which Holdings or such
Restricted Subsidiary is a party; or Liens created by or resulting from any litigation or other proceeding that would not result in an Event of Default under the Indenture; or
- (9)
- Liens
for taxes or assessments or governmental charges or levies not yet due or delinquent, or which can thereafter be paid without penalty, or which are
being contested in good faith by appropriate proceedings; landlord's Liens on property held under lease; and any other Liens or charges incidental to the conduct of the business of Holdings or any
Restricted Subsidiary or the ownership of the property and assets of any of them that were not incurred in connection with the borrowing of money or the obtaining of advances or credit and that do
not, in the opinion of Holdings, materially impair the use of such property in the operation of the business of Holdings or such Restricted Subsidiary or the value of such property for the purposes of
such business.
Notwithstanding
the foregoing provisions, Holdings and any one or more Restricted Subsidiaries may issue, assume or guarantee indebtedness for borrowed money secured by Liens that would
otherwise be subject to the foregoing restrictions in an aggregate amount that, together with all the other outstanding indebtedness for borrowed money of Holdings and its Restricted Subsidiaries
secured by Liens that are not listed in clauses (1) through (9) above, does not at the time of the issuance, assumption of guarantee thereof, exceed 12.5% of the Consolidated Net
Tangible Assets of Holdings as shown on, or derived from, Holdings's most recent quarterly or annual consolidated balance sheet.
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Restrictions as to Dividends and Certain Other Payments
The Indenture provides that no dividend whatsoever shall be paid or declared nor shall any distributions be made on any Capital Stock
of Holdings (except in shares of, or warrants or rights to subscribe for or purchase shares of, Capital Stock of Holdings), nor shall any payment be made by Holdings or any Restricted Subsidiary to
acquire or retire shares of such Capital Stock, at a time when an Event of Default as defined under clause (1), (2) or (3) under the caption
"Events of Default" has occurred and is continuing.
Restrictions on Permitting Restricted Subsidiaries to Become Unrestricted Subsidiaries and
Unrestricted Subsidiaries to Become Restricted Subsidiaries
The Indenture provides that Holdings will not permit any Restricted Subsidiary to be designated as an Unrestricted Subsidiary unless,
immediately after such designation, such Subsidiary will not own, directly or indirectly, any Capital Stock or indebtedness of any Restricted Subsidiary.
The
Indenture also provides that Holdings will not permit any Unrestricted Subsidiary to be designated as a Restricted Subsidiary unless, immediately after such designation, such
Subsidiary has outstanding no Liens securing indebtedness for borrowed money except as would have been permitted by the covenant described under the caption
"Certain CovenantsRestrictions on Liens" above had such Liens been incurred immediately after such designation.
Promptly
after the adoption of any resolution by the Board of Directors of Holdings designating a Restricted Subsidiary as an Unrestricted Subsidiary or an Unrestricted Subsidiary as a
Restricted Subsidiary, Holdings shall file a certified copy thereof with the Trustee, together with an Officers' Certificate as required by the terms of the Indenture.
Each
of Holdings's Subsidiaries on the date of the Indenture was a Restricted Subsidiary.
Restrictions on Investments in Unrestricted Subsidiaries
The Indenture provides that Holdings will not, nor will it permit any Restricted Subsidiary to, make any investment in, or transfer any
assets to, an Unrestricted Subsidiary at a time when a Default or Event of Default has occurred and is continuing.
SEC Reports and Reports to Holders
The Indenture provides that notwithstanding that Holdings may not be subject to the reporting requirements of Section 13 or
15(d) of the Exchange Act or otherwise report on an annual and quarterly basis pursuant to rules and regulations promulgated by the SEC, Holdings will file with, or furnish to, the SEC (and will
deliver a copy to the Trustee and make available to the holders of the Notes (without exhibits), within 15 days after it files them with, or furnishes them to, the
SEC):
- (1)
- within
120 days (or any longer time period then in effect under the rules and regulations of the Exchange Act for a non-accelerated filer), plus any
grace period provided by Rule 12b-25 under the Exchange Act, after the end of each fiscal year, annual reports on Form 20-F, or any successor or comparable form (including
Form 10-K), containing the information required to be contained therein);
- (2)
- within
75 days (or any longer time period then in effect under the rules and regulations of the Exchange Act) after the end of each of the first
three fiscal quarters of each fiscal year,
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reports
on Form 6-K, containing the information required to be contained therein, or any successor or comparable form (including Form 10-Q);
- (3)
- promptly
from time to time after the occurrence of an event required to be therein reported, current reports containing substantially the information
required to be contained in a current report on Form 6-K, or any successor or comparable form; provided that no such current report or any
information required to be contained in such current report will be required to be filed or furnished if the Issuers determine in their good faith judgment that such event, or any information with
respect to such event that is not included in any report that is filed or furnished, is not material to the holders of the Notes or the business, assets, operations, financial position or prospects of
Holdings and its Restricted Subsidiaries, taken as a whole, or such current report relates solely to securities other than the Notes and the Guarantees; and
- (4)
- any
other information, documents and other reports that Holdings would be required to file with the SEC if it were subject to Section 13 or 15(d) of
the Exchange Act;
provided that all such reports (A) will not be required to comply with Section 302 or Section 404 of the Sarbanes-Oxley Act of
2002, or related Items 307 and 308 of Regulation S-K promulgated by the SEC, or Item 10(e) of Regulation S-K (with respect to any non-GAAP financial measures contained
therein), (B) will not be required to contain the information required by Items 201, 402, 403, 405, 406, 407, 701 or 703 of Regulation S-K or (C) will not be required to
contain the separate financial information contemplated by Rule 3-10 of Regulation S-X promulgated by the SEC;
provided further that Holdings shall not be so obligated to file such reports with, or furnish such reports to, the SEC if the SEC does not permit such
filing or furnishing, in which event Holdings will make available such information to prospective purchasers of notes, in addition to providing such information to the Trustee and the holders of the
Notes, in each case within 15 days after the time Holdings would be required to file such information with, or furnish such information to, the SEC, if it were subject to Section 13 or
15(d) of the Exchange Act, pursuant to the provisions set forth in clauses (1) through (4) above.
Other
than with respect to delivery to the Trustee, the foregoing delivery requirements will be deemed satisfied if the foregoing materials are publicly available on the SEC's EDGAR
system (or a successor thereto) within the applicable time periods specified above.
Merger and Sale of Assets
The Indenture provides that Holdings may not consolidate, amalgamate or merge with or into or wind up into (whether or not Holdings is
the surviving entity), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets, in one or more related transactions, to any Person
unless:
- (1)
- Holdings
is the surviving Person or the Person formed by or surviving any such consolidation, amalgamation or merger (if other than Holdings) or to which
such sale, assignment, transfer, lease, conveyance or other disposition will have been made is a Person organized or existing under the laws of the jurisdiction of organization of Holdings or under
the laws of a Permitted Jurisdiction (Holdings or such Person, as the case may be, being herein called "Successor Holdings");
- (2)
- Successor
Holdings, if other than Holdings, expressly assumes all the obligations of Holdings under the Notes and the Indenture pursuant to a supplemental
indenture;
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- (3)
- Immediately
after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing;
- (4)
- Successor
Holdings, if other than Holdings, shall have delivered, or cause to be delivered, to the Trustee an opinion of counsel (which may contain
customary exceptions) stating that the Guarantee to be provided by Successor Holdings has been duly authorized, executed and delivered by Successor Holdings and constitutes the legal, valid and
enforceable obligation of Successor Holdings; and
- (5)
- Successor
Holdings shall have delivered, or cause to be delivered, to the Trustee an Officers' Certificate and an opinion of counsel, each stating that such
consolidation, amalgamation, merger or transfer and such supplemental indenture, if any, comply with the Indenture;
provided, however, that, notwithstanding the foregoing clause (3), (i) any Restricted
Subsidiary may consolidate or amalgamate with or merge with or into Holdings; (ii) Holdings may consolidate or amalgamate with or merge with or into or wind up into an Affiliate of Holdings
solely for the purpose of reincorporating Holdings in a Permitted Jurisdiction; and (iii) Holdings may be converted into, or reorganized or reconstituted in a Permitted Jurisdiction.
Successor
Holdings (if other than Holdings) will succeed to, and be substituted for, Holdings under the Indenture and Holdings's Guarantee and in such event Holdings will automatically
be released and discharged from its obligation under the Indenture and Holdings's Guarantee.
The
Indenture provides that the Irish Issuer may not consolidate, amalgamate or merge with or into or wind up into (whether or not the Irish Issuer is the surviving entity), or sell,
assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets, in one or more related transactions, to any Person unless:
- (1)
- the
Irish Issuer is the surviving Person or the Person formed by or surviving any such consolidation, amalgamation or merger (if other than the Irish
Issuer) or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is a Person organized or existing under the laws of the jurisdiction of organization of
the Irish Issuer or under the laws of a Permitted Jurisdiction (the Irish Issuer or such Person, as the case may be, being herein called "Successor Irish Issuer");
- (2)
- the
Successor Irish Issuer, if other than the Irish Issuer, expressly assumes all the obligations of the Irish Issuer under the Notes, the Indenture and the
Registration Rights Agreements pursuant to a supplemental indenture;
- (3)
- immediately
after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing;
- (4)
- if
the Successor Irish Issuer is other than the Irish Issuer, the Irish Issuer shall have delivered, or cause to be delivered, to the Trustee an opinion of
local tax counsel stating that the holders of notes will not recognize income, gain or loss in the jurisdiction of organization of the Irish Issuer for income tax purposes as a result of such
transaction and will be subject to income tax in such jurisdiction on the same amounts, in the same manner and at the same times as would have been the case if such transaction had not occurred;
- (5)
- if
the Successor Irish Issuer is other than the Irish Issuer, the Irish Issuer shall have delivered, or cause to be delivered, to the Trustee an opinion of
local tax counsel stating that the holders of notes will not recognize income, gain or loss for U.S. federal income
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tax
purposes as a result of such transaction and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such
transaction had not occurred;
- (6)
- if
the Successor Irish Issuer is other than the Irish Issuer, each Guarantor, unless it is the other party to the transactions, shall have by supplemental
indenture confirmed that its Guarantee shall apply to such Successor Irish Issuer's obligations under the Indenture and each series of notes; and
- (7)
- the
Successor Irish Issuer shall have delivered, or cause to be delivered, to the Trustee an Officers' Certificate and an opinion of counsel, each stating
that such consolidation, amalgamation, merger or transfer and such supplemental indenture, if any, comply with the Indenture;
provided, however, that, notwithstanding the foregoing clause (3), (i) any Restricted
Subsidiary may consolidate or amalgamate with or merge with or into the Irish Issuer; (ii) the Irish Issuer may consolidate or amalgamate with or merge with or into or wind up into an Affiliate
of the Irish Issuer solely for the purpose of reincorporating the Irish Issuer in a Permitted Jurisdiction; and (iii) the Irish Issuer may be converted into, or reorganized or reconstituted in
a Permitted Jurisdiction.
Successor
Irish Issuer (if other than the Irish Issuer) will succeed to, and be substituted for, the Irish Issuer under the Indenture and the Notes and in such event the Irish Issuer
will automatically be released and discharged from its obligation under the Indenture and the Notes.
The
Indenture provides that the U.S. Issuer may not consolidate, amalgamate or merge with or into or wind up into (whether or not the U.S. Issuer is the surviving entity), or sell,
assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets, in one or more related transactions, to any Person unless:
- (1)
- the
U.S. Issuer is the surviving Person or the Person formed by or surviving any such consolidation, amalgamation or merger (if other than the U.S. Issuer)
or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is a Person organized or existing under the laws of the jurisdiction of organization of the U.S.
Issuer or the laws of the United States, any state thereof, the District of Columbia or any territory thereof (the U.S. Issuer or such Person, as the case may be, being herein called "Successor U.S.
Issuer");
- (2)
- the
Successor U.S. Issuer, if other than the U.S. Issuer, expressly assumes all the obligations of the U.S. Issuer under the Notes, the Indenture and the
Registration Rights Agreements pursuant to a supplemental indenture;
- (3)
- immediately
after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing;
- (4)
- if
the Successor U.S. Issuer is other than the U.S. Issuer, each Guarantor, unless it is the other party to the transactions, shall have by supplemental
indenture confirmed that its Guarantee shall apply to such Successor U.S. Issuer's obligations under the Indenture and each series of notes; and
- (5)
- the
Successor U.S. Issuer shall have delivered, or cause to be delivered, to the Trustee an Officers' Certificate and an opinion of counsel, each stating
that such consolidation, amalgamation, merger or transfer and such supplemental indenture, if any, comply with the Indenture;
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provided, however, that, notwithstanding the foregoing clause (3), (i) the U.S. Issuer may
consolidate or amalgamate with or merge with or into or wind up into an Affiliate of the U.S. Issuer solely for the purpose of reincorporating the U.S. Issuer in the United States, any state thereof,
the District of Columbia or any territory thereof; and (ii) the U.S. Issuer may be converted into, or reorganized or reconstituted in the United States, any state thereof, the District of
Columbia or any territory thereof.
Successor
U.S. Issuer (if other than the U.S. Issuer) will succeed to, and be substituted for the U.S. Issuer, as the case may be, under the Indenture and the Notes and in such event the
U.S. Issuer will automatically be released and discharged from its obligation under the Indenture and the Notes.
The
Indenture provides that each Subsidiary Guarantor may not consolidate, amalgamate or merge with or into or wind up into (whether or not the applicable Subsidiary Guarantor is the
surviving entity), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets, in one or more related transactions, to any Restricted
Subsidiary (other than an Issuer) unless:
- (1)
- the
applicable Subsidiary Guarantor is the surviving Person or the Person formed by or surviving any such consolidation, amalgamation or merger (if other
than such Subsidiary Guarantor) or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is a Person organized or existing under the laws of the
jurisdiction of organization of such Subsidiary Guarantor or under the laws of a Permitted Jurisdiction (such Subsidiary Guarantor or such Person, as the case may be, being herein called "Successor
Subsidiary Guarantor");
- (2)
- the
Successor Subsidiary Guarantor, if other than the applicable Subsidiary Guarantor, expressly assumes all the obligations of such Subsidiary Guarantor
under the Notes, the Indenture and the Registration Rights Agreements pursuant to a supplemental indenture;
- (3)
- immediately
after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing;
- (4)
- Successor
Subsidiary Guarantor, if other than the applicable Subsidiary Guarantor, shall have delivered, or cause to be delivered, to the Trustee an opinion
of counsel (which may contain customary exceptions) stating that the Guarantee to be provided by such Successor Subsidiary Guarantor has been duly authorized, executed and delivered by such Successor
Subsidiary Guarantor and constitutes the legal, valid and enforceable obligation of such Successor Subsidiary Guarantor; and
- (5)
- the
Successor Subsidiary Guarantor shall have delivered, or cause to be delivered, to the Trustee an Officers' Certificate and an opinion of counsel, each
stating that such consolidation, amalgamation, merger or transfer and such supplemental indenture, if any, comply with the Indenture;
provided, however, that, notwithstanding the foregoing clause (3), (i) any Restricted
Subsidiary may consolidate or amalgamate with or merge with or into a Subsidiary Guarantor; (ii) any Subsidiary Guarantor may consolidate or amalgamate with or merge with or into or wind up
into an Affiliate of such Subsidiary Guarantor solely for the purpose of reincorporating such Subsidiary Guarantor in a Permitted Jurisdiction; and (iii) any Subsidiary Guarantor may be
converted into, or reorganized or reconstituted in a Permitted Jurisdiction.
Successor
Subsidiary Guarantor (if other than the applicable Subsidiary Guarantor) will succeed to, and be substituted for the applicable Subsidiary Guarantor under the Indenture and
such Subsidiary Guarantor's Guarantee and in such event the applicable Subsidiary Guarantor will automatically be released and discharged from its obligation under the Indenture and such Subsidiary
Guarantor's Guarantee.
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Future Subsidiary Guarantors
The Indenture provides that Holdings will not cause or permit any of its Restricted Subsidiaries (other than a Securitization
Subsidiary), directly or indirectly, to guarantee any capital markets debt or any unsecured credit facility (other than Standard Securitization Undertakings in connection with a Qualified
Securitization Financing) of Holdings, the Issuers or any Subsidiary Guarantor (other than guarantees by any of the U.S. Issuer's Subsidiaries of capital markets debt or unsecured credit facilities of
the U.S. Issuer or any of its Subsidiaries), unless such Restricted Subsidiary:
- (1)
- within
five Business Days of the date on which it guarantees such capital markets debt or unsecured credit facility, executes and delivers to the Trustee a
supplemental indenture pursuant to which such Restricted Subsidiary shall guarantee all of the Issuers' obligations under the Notes and the Indenture; and
- (2)
- delivers
to the Trustee an opinion of counsel (which may contain customary exceptions) stating that such supplemental indenture and Guarantee have been duly
authorized, executed and delivered by such Restricted Subsidiary and constitute the legal, valid and enforceable obligation of such Restricted Subsidiary.
Thereafter,
such Restricted Subsidiary shall be a Subsidiary Guarantor for all purposes of the Indenture until such Guarantee is released in accordance with the provisions of the
Indenture.
Notwithstanding
the foregoing, Restricted Subsidiaries of the U.S. Issuer and any of its Subsidiaries shall be permitted to guarantee capital markets debt and unsecured credit facilities
without complying with this covenant.
Events of Default
The Indenture defines an Event of Default with respect to a series of notes as being any one of the following
occurrences:
- (1)
- default
in the payment of any installment of interest upon any note of such series when it becomes due and payable, and continuance of such default for a
period of 30 days or more;
- (2)
- default
in the payment of all or any part of the principal of any note of such series when it becomes due and payable at its maturity;
- (3)
- default
in the performance, or breach, of any other covenant or warranty of Holdings or any Restricted Subsidiary in the Indenture applicable to such series
of notes or in any series of notes, and continuance of such default or breach for a period of 60 days after notice to Holdings by the Trustee, or to Holdings and the Trustee by the holders of
at least 25% in principal amount of the Notes of such series at the time Outstanding;
- (4)
- default
under any mortgage, indenture (including the Indenture) or instrument under which there is issued, or which secures or evidences, any indebtedness
for borrowed money of Holdings or any Restricted Subsidiary existing on, or created after, the date of the Indenture, which default shall constitute a failure to pay principal of such indebtedness in
an amount exceeding $50,000,000 when due and payable (other than as a result of acceleration), after expiration of any applicable grace period with respect thereto, or shall have resulted in an
aggregate principal amount of such indebtedness exceeding $50,000,000 becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable, without such
indebtedness having been discharged or such acceleration having been rescinded or annulled within a period of
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30 days
after there has been given a notice to Holdings by the Trustee, or to Holdings and the Trustee by the holders of at least 25% in principal amount of such series of notes at the time
Outstanding;
- (5)
- any
Guarantee ceases to be in full force and effect in any material respect (except as contemplated by the terms thereof) or any such Guarantor denies or
disaffirms its obligations under the Indenture or any Guarantee if, and only if, in each such case, such default continues for 10 consecutive days; or
- (6)
- certain
events in relation to bankruptcy, insolvency, reorganization, receivership or liquidation, whether voluntary or involuntary.
If
an Event of Default (other than an Event of Default relating to certain events of bankruptcy, insolvency, reorganization, receivership or liquidation) occurs and is continuing, the
Trustee or the holders of at least 25% in principal amount with respect to any series of notes at the time Outstanding may declare such series of notes to be due and payable immediately, but under
certain conditions such acceleration may be rescinded by the holders of a majority in principal amount of such series of notes at the time Outstanding. If an Event of Default relating to certain
events of bankruptcy, insolvency, reorganization, receivership or liquidation occurs and
is continuing, the principal of, premium, if any, and interest on all the Notes will become immediately due and payable without any declaration or other act on the part of the Trustee or any holders.
The
holder of any Note will not have any right to institute any proceeding with respect to the Indenture or remedies thereunder, unless:
- (1)
- such
holder previously gives the Trustee written notice of an Event of Default with respect to the applicable series of notes and that Event of Default is
continuing;
- (2)
- the
holders of not less than 25% in principal amount of Outstanding notes of such series shall have made a written request to the Trustee to institute
proceedings in respect of such Event of Default and offered the Trustee indemnity reasonably satisfactory to the Trustee to institute such proceeding as Trustee; and
- (3)
- the
Trustee shall have failed to institute such proceeding for 60 days after its receipt of such notice and the Trustee has not been given
inconsistent direction during such 60-day period by holders of a majority in principal amount of the Notes of such series at the time Outstanding.
The
right of any holder of any Note to institute suit for enforcement of any payment of principal and interest on any Note on or after the applicable due date may not be impaired or
affected without such holder's consent.
The
holders of a majority in principal amount of Outstanding notes of a series may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee
or for exercising any trust or power conferred on the Trustee with respect to such series of notes. The Trustee may refuse to follow any direction that conflicts with any rule of law or the Indenture
or that may expose the Trustee to personal liability. Before proceeding to exercise any right or power under the Indenture at the direction of such holders, the Trustee shall be entitled to receive
security or indemnity reasonably satisfactory to the Trustee from such holders against the fees, costs, expenses and liabilities that could be incurred in compliance with any such direction. The
Indenture will provide that if a Default occurs and is continuing and is known to the Trustee, the Trustee will deliver within 60 days by mail, or electronically if held by DTC, to each holder
of notes of such series notice of the Default. The Trustee may withhold from holders of a series of notes notice of any continuing Default
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(except
a Default in payment of principal, premium (if any) or interest), if it determines that withholding notice is in the interests of the holders of such series of notes.
Holdings
is required under the Indenture to furnish to the Trustee within 120 days after the end of each fiscal year a statement as to whether it is in Default under the Indenture
and, if it is in Default, specifying all such Defaults and the nature and status thereof.
Amendment, Supplement and Waiver of the Indenture
The Indenture contains provisions permitting the Issuers and the Trustee to amend or supplement the Indenture (including the provisions
relating to a repurchase of the Notes upon the occurrence of a Change of Control Triggering Event) with the consent of the holders of a majority in principal amount of the Outstanding notes voting as
a single group; provided that any amendment or supplement that affects the terms of any series of notes as distinct from any other series of notes shall
require the consent of the holders of a majority in principal amount of the Outstanding notes of such series. Any past Default by the Issuers in respect of any series of notes and its consequences may
be waived with the consent of the holders of a majority in principal amount of the Outstanding notes of such series. The Issuers are not permitted, however, to enter into any amendment, supplement or
waiver without the consent of the holders of all affected notes if the amendment, supplement or waiver would:
- (1)
- change
the stated maturity of the principal of or any installment of principal or interest on any Note;
- (2)
- reduce
the principal amount payable of, or the rate of interest on, any Note;
- (3)
- change
the date on which any notes may be subject to redemption, or reduce the redemption price therefor;
- (4)
- reduce
any premium payable (other than in connection with a Change of Control Triggering Event);
- (5)
- make
any Note payable in a currency other than U.S. dollars;
- (6)
- impair
the right of the holders of such series of notes to institute suit for the enforcement of any payment on or after the stated maturity thereof;
- (7)
- release
the Guarantee of Holdings or the Guarantee of any Subsidiary Guarantor that is a Significant Subsidiary;
- (8)
- amend,
change or modify any provision of the Indenture affecting the ranking of a series of notes in a manner adverse to the holders of such series of
notes; or
- (9)
- make
any change in the preceding amendment, supplement or waiver provisions.
The
Indenture also contains provisions permitting the Issuers and the Trustee to amend or supplement the terms of the Indenture with respect to a series of notes, without the consent of
any holder of such notes, for certain purposes including:
- (1)
- to
evidence either Issuer's succession by another Person;
- (2)
- to
comply with the covenant described under the caption "Certain CovenantsMerger and Sale of
Assets";
- (3)
- to
comply with requirements of the SEC in order to effect or maintain the qualification of the Indenture under the Trust Indenture Act;
- (4)
- to
add Guarantees under the Indenture in accordance with the terms of the Indenture;
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- (5)
- to
add covenants for the benefit of the holders of such series of notes or any additional Event of Default for such series of notes;
- (6)
- to
secure the Notes;
- (7)
- to
evidence the appointment of a successor trustee;
- (8)
- to
conform the text of the Indenture or a series of notes to any provision of this "Description of Notes" to
the extent that such provision was intended by the Issuers to be a verbatim recitation of a provision of the Indenture, which intent shall be evidenced by an Officers' Certificate delivered to the
Trustee; or
- (9)
- to
cure any ambiguity, to correct or supplement any provision of the Indenture inconsistent with other provisions or make any other provision that does not
adversely affect the interests of the holders of such series of notes in any material respect, as determined by the Issuers.
Legal Defeasance and Covenant Defeasance
The Issuers and the Guarantors may, at their option, and at any time, elect to have all their obligations discharged under the
Indenture with respect to a series of notes and cure any then existing Events of Default with respect to such series of notes ("legal defeasance"), other than:
- (1)
- the
rights of holders to receive payments in respect of the principal of, premium, if any, and interest on the Notes of such series when such payments are
due;
- (2)
- the
Issuers' obligations with respect to the register, transfer and exchange of such notes and with respect to mutilated, destroyed, lost or stolen notes;
- (3)
- the
Issuers' obligations to maintain an office or agency in the place designated for payment of such notes and with respect to the treatment of funds held
by paying agents;
- (4)
- the
Issuers' obligations to hold, or cause the paying agent to hold, in trust money for the payment of principal and interest due on Outstanding notes of
such series for the benefit of the holders;
- (5)
- certain
obligations to the Trustee; and
- (6)
- certain
obligations arising in connection with such discharge of obligations.
The
Issuers may also, at their option and at any time, elect to be released from the restrictions described under the caption "Certain
Covenants" above with respect to a series of notes ("covenant defeasance") and thereafter, any omission to comply with such covenants will not constitute an Event of Default
with respect to such series of notes.
The
conditions the Issuers must satisfy for legal defeasance or covenant defeasance include the following:
- (1)
- the
Issuers must have irrevocably deposited with the Trustee trust funds for the payment of such series of notes. The trust funds must consist of U.S.
dollars or U.S. Government Obligations, or a combination thereof, that will be in an amount sufficient without reinvestment to pay at maturity or redemption the entire amount of principal and interest
on such series of notes;
- (2)
- in
the case of legal defeasance, the Irish Issuer shall have delivered, or cause to be delivered, to the Trustee an opinion of outside counsel confirming
that (i) the Issuers have received from, or there has been published by, the United States Internal Revenue Service
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a
ruling or (ii) since the issuance of such series of notes, there has been a change in the applicable U.S. federal income tax law, in either case stating that, and based thereon such opinion
of counsel shall confirm that, the holders of such series of notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such defeasance and will be subject to
U.S. federal income tax on the same amounts, in the same manner at the same times as would have been the case if such defeasance had not occurred;
- (3)
- in
the case of covenant defeasance, the Irish Issuer shall have delivered, or cause to be delivered, to the Trustee an opinion of outside counsel confirming
that the holders of such series of notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such defeasance and will be subject to U.S. federal income tax on
the same amounts, in the same manner at the same times as would have been the case if such defeasance had not occurred;
- (4)
- the
Irish Issuer shall have delivered, or cause to be delivered, to the Trustee an opinion of outside counsel stating that the holders of such series of
notes will not recognize income, gain or loss in the jurisdiction of organization of the Irish Issuer for income tax purposes as a result of such defeasance and will be subject to income tax in such
jurisdiction on the same amounts, in the same manner and at the same times as would have been the case if such transaction had not occurred;
- (5)
- no
Default or Event of Default shall have occurred and be continuing on the date the Issuers make such deposits (other than a Default or Event of Default
resulting from the borrowing of funds to be applied to such deposit or the granting of Liens in connection therewith);
- (6)
- the
Irish Issuer shall have delivered, or cause to be delivered, to the Trustee an Officers' Certificate stating that the deposit was not made by the
Issuers with the intent of defeating, hindering, delaying or defrauding any creditors of the Issuers; and
- (7)
- the
Irish Issuer shall have delivered, or cause to be delivered, to the Trustee an Officers' Certificate and an opinion of counsel (which opinion of counsel
may be subject to customary assumptions and exclusions) each stating that all conditions precedent provided for or relating to such defeasance, as the case may be, have been complied with.
Satisfaction and Discharge
The Indenture will be discharged and will cease to be of further effect as to a series of notes when:
- (1)
- either:
- (a)
- all
notes of such series theretofore authenticated and delivered, except lost, stolen or destroyed notes that have been replaced or paid and notes for whose
payment money has theretofore been deposited in trust, have been delivered to the Trustee for cancellation; or
- (b)
- all
notes of such series not theretofore delivered to such Trustee for cancellation have become due and payable by reason of the making of a notice of
redemption or otherwise or will become due and payable within one year, and the Issuers have irrevocably deposited or caused to be deposited with such Trustee as trust funds in trust solely for the
benefit of the holders, cash in U.S. dollars, U.S. Government Obligations, or a combination thereof, in such amounts as will be sufficient without
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consideration
of any reinvestment of interest to pay and discharge the entire indebtedness on such notes not theretofore delivered to the Trustee for cancellation for principal, premium, if any, and
accrued interest to the date of maturity or redemption;
- (2)
- the
Issuers have paid or caused to be paid all sums payable under the Indenture with respect to the Notes; and
- (3)
- the
Issuers have delivered irrevocable instructions to the Trustee under the Indenture to apply the deposited money toward the payment of such notes at
maturity or the redemption date, as the case may be.
In
addition, the Issuers must deliver, or cause to be delivered, an Officers' Certificate and an opinion of counsel to the Trustee, each stating that all conditions precedent to
satisfaction and discharge have been satisfied.
Governing Law; Jury Trial Waiver
The Indenture and the Notes are governed by and shall be construed in accordance with the laws of the State of New York without regard
to conflicts of law principles thereof. The Indenture provides that the Issuers, the Guarantors, the Trustee, and each holder of a Note by its acceptance thereof irrevocably waives, to the fullest
extent permitted by applicable law, any and all right to a trial by jury in any legal proceeding arising out of or relating to the Indenture, the Notes or any transaction contemplated thereby.
Certain Definitions
The following definitions apply to the terms of the Notes.
"Affiliate"
of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For
the purposes of this definition, "control" when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing.
"Applicable
Premium" means, as determined by the Issuers with respect to any Note on any redemption date, the excess of:
- (1)
- the
sum of the present value at such redemption date of all remaining scheduled payments of principal and interest on such Note through the stated maturity
date of such Note (excluding accrued but unpaid interest to the redemption date), discounted to the date of redemption using a discount rate equal to the Treasury Rate plus 50 basis points; over
- (2)
- the
principal amount of the Notes to be redeemed.
"Board
of Directors" means, with respect to Holdings, either the board of directors of Holdings or any committee of that board duly authorized to act under the terms of the Indenture and
with respect to any other Person, the board of directors or committee of such Person serving a similar function.
"Business
Day" means any day other than Saturday, Sunday or any other day on which banking or trust institutions in New York or London are authorized generally or obligated by law,
regulation or executive order to remain closed.
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"Capital
Stock" means (a) in the case of a corporation, corporate stock, (b) in the case of an association or business entity, any and all shares, interests,
participations, rights or other equivalents (however designated) of corporate stock, (c) in the case of a partnership, unlimited liability company or limited liability company, partnership
interests, membership interests (whether general or limited) or shares in the capital of the company and (d) any other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing Person.
"Change
of Control" means:
- (1)
- any
"person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders, is or
becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of shares representing more than 50% of the voting power of Holdings's Voting
Stock;
- (2)
- Holdings
ceases to own, directly or indirectly, 100% of the issued and outstanding Voting Stock of either Issuer, other than director's qualifying shares
and other shares required to be issued by law;
- (3)
- during
any period of two consecutive years, individuals who at the beginning of such period constituted the Board of Directors of Holdings (together with
any new directors whose election to such Board of Directors or whose nomination for election by the shareholders of Holdings was approved by a vote of the majority of the directors of Holdings then
still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved (who cannot include persons not elected by or
recommended for election by the then-incumbent Board of Directors unless such Board of Directors of Holdings determines reasonably and in good faith that failure to approve any such persons as members
of the Board of Directors of Holdings could reasonably be expected to violate a fiduciary duty under applicable law)), cease for any reason to constitute a majority of the Board of Directors of
Holdings;
- (4)
- (a)
all or substantially all of the assets of Holdings and the Restricted Subsidiaries, taken as a whole, are sold or otherwise transferred to any Person
other than a Wholly-Owned Restricted Subsidiary or one or more Permitted Holders or (b) Holdings consolidates, amalgamates or merges with or into another Person or any Person consolidates,
amalgamates or merges with or into Holdings, in either case in one transaction or a series of related transactions in which immediately after the consummation thereof Persons beneficially owning (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act) Voting Stock representing in the aggregate a majority of the total voting power of the Voting Stock of Holdings immediately prior to
such consummation do not beneficially own (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) Voting Stock representing a majority of the total voting power of the Voting Stock of
Holdings or the applicable surviving or transferee Person (or applicable parent thereof); provided that this clause shall not apply (i) in the
case where immediately after the consummation of the transactions Permitted Holders beneficially own Voting Stock representing in the aggregate a majority of the total voting power of Holdings or the
applicable surviving or transferee Person (or applicable parent thereof) or (ii) to a consolidation, amalgamation or merger of Holdings with or into a Person or wholly-owned subsidiary of a
Person that, in either case, immediately following the transaction or series of transactions, has no Person or group (other than Permitted Holders) that beneficially owns Voting Stock representing 50%
or more of the voting power of the total outstanding Voting Stock of such Person and, in the case of clause (y), the parent of such wholly-owned subsidiary guarantees Holdings's obligations
under the Notes and the Indenture; or
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- (5)
- Holdings
shall adopt a plan of liquidation or dissolution or any such plan shall be approved by the shareholders of Holdings.
"Change
of Control Triggering Event" means the occurrence of both a (1) Change of Control and (ii) a Rating Decline.
"Consolidated
Net Tangible Assets" means the total amount of assets (less depreciation and valuation reserves and other reserves and items deductible from the gross book value of
specific asset amounts under GAAP) that, under GAAP, would be included on a consolidated balance sheet of Holdings and its Restricted Subsidiaries, after deducting therefrom (i) all liability
items except indebtedness for borrowed money (whether incurred, assumed or guaranteed) maturing by its terms more than one year from the date of creation thereof or that is extendible or renewable at
the sole option of the obligor in such manner that it may become payable more than one year from the date of creation thereof, shareholder's equity and reserves for deferred income taxes,
(ii) all goodwill, trade names, trademarks, patents, unamortized debt discount and expense and other like intangibles that in each case would be so included on such balance sheet, and
(iii) amounts invested in, or equity in the net assets of, Unrestricted Subsidiaries.
"Credit
Agreement" means the Amended and Restated Credit Agreement dated as of March 11, 2014, among Holdings, the Irish Issuer, as borrower, the subsidiary guarantors and lenders
party thereto, and Citibank, N.A., as administrative agent.
"Default"
means any event or condition that is, or after notice or passage of time or both would be, an Event of Default.
"Exchange
Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.
"Fitch"
means Fitch Ratings, Inc. or any successor ratings agency.
"GAAP"
means generally accepted accounting principles in the United States that are in effect from time to time. At any time after the date of the Indenture, Holdings may elect to apply
IFRS accounting principles in lieu of GAAP and, upon any such election, references herein to GAAP shall thereafter be construed to mean IFRS; provided
that any calculation or determination herein that requires the application of GAAP for periods that include fiscal quarters ended prior to Holdings's election to apply IFRS shall remain as previously
calculated or determined in accordance with GAAP. Holdings shall give notice of any such election made in accordance with this definition to the Trustee and the holders of the Notes.
"Issue
Date" means June 25, 2015.
"Guarantee"
means the guarantee by any Guarantor of the Issuers' obligations under the Indenture and the Notes.
"Lien"
means any mortgage, pledge, lien, security interest or other charge, encumbrance or preferential arrangement, including the retained security title of a conditional vendor or
lessor. For avoidance of doubt, the parties hereto acknowledge that (a) the filing of a financing statement under the Uniform Commercial Code does not, in and of itself, give rise to a Lien and
(b) in no event shall an operating lease be deemed to constitute a Lien.
"Management
Group" means at any time, the Chairman of the board of directors, the Chief Executive Officer, the President, any Managing Director, Executive Vice President, Senior Vice
President or Vice President, any Treasurer and any Secretary of Holdings or other executive officer of Holdings or any Subsidiary of Holdings at such time.
"Moody's"
means Moody's Investor Service, Inc. or any successor ratings agency.
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"Officer" means the Chairman of the board of directors, the Chief Executive Officer, the President, any Managing Director, Executive Vice President, Senior Vice
President or Vice President, any Treasurer or any Secretary or other executive officer of the Irish Issuer or Holdings, as applicable.
"Officers'
Certificate" means, with respect to any Person, a certificate signed on behalf of such Person by two Officers of such Person that meets the requirements set forth in the
Indenture.
"Outstanding"
means, as of the date of determination, all notes (or series of notes, as applicable) theretofore authenticated and delivered under the Indenture,
except:
- (1)
- Notes
theretofore cancelled by the Trustee or delivered to the Trustee for cancellation;
- (2)
- Notes
for whose payment or redemption money in the necessary amount has been theretofore deposited with the Trustee or any paying agent (other than the
Issuers) in trust or set aside and segregated in trust by the Issuers (if an Issuer shall act as its own paying agent);
- (3)
- Notes
that have been defeased pursuant to the procedures specified under the caption "Legal Defeasance and Covenant
Defeasance" above; and
- (4)
- Notes
that have been paid in lieu of reissuance relating to lost, stolen, destroyed or mutilated certificates, or in exchange for or in lieu of which other
notes have been authenticated and delivered pursuant to the Indenture, other than any such notes in respect of which there shall have been presented to the Trustee proof satisfactory to it that such
notes are held by a bona fide purchaser in whose hands such notes are valid obligations of the Issuers and the Guarantors;
provided, however, that in determining whether the holders of the requisite principal amount of the Outstanding notes have given any request, demand,
authorization, direction, notice, consent or waiver under the Indenture, notes owned by an Issuer or any other obligor upon the Notes or any Affiliate of an Issuer or of such other obligor shall be
disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or
waiver, only notes that the Trustee knows to be so owned shall be so disregarded. Notes so owned that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such notes and that the pledgee is not an Issuer or any other obligor upon the Notes or any Affiliate of an Issuer or of such
other obligor.
"Permitted
Holders" means American International Group, Inc., Waha Capital, their respective Affiliates and the Management Group. Any Person or group whose acquisition of
beneficial ownership constitutes a Change of Control in respect of which a Change of Control Offer is made in accordance with the requirements of the Indenture will thereafter, together with its
Affiliates, constitute an additional Permitted Holder.
"Permitted
Jurisdiction" means any of the United States, any state thereof, the District of Columbia, or any territory thereof, any member state of the Pre-Expansion European Union,
Switzerland, Bermuda, the Cayman Islands and Singapore.
"Person"
means any individual, corporation, unlimited liability company, limited liability company, partnership, joint venture, association, joint stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
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"Pre-Expansion
European Union" means the European Union as of January 1, 2004, including the countries of Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland,
Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and the United Kingdom, but not including any country which became or becomes a member of the European Union after January 1, 2004; provided that "Pre-Expansion European Union" shall not include any country whose long-term debt does not have a long-term rating of at least "Aa2" by
Moody's, "AA" by S&P, "AA" by Fitch or the equivalent rating category of another Rating Organization.
"Qualified
Securitization Financing" means any Securitization Financing of a Securitization Subsidiary, the financing terms, covenants, termination events and other provisions of which,
including any Standard Securitization Undertakings, shall be market terms.
"Rating
Date" means the date that is the day prior to the initial public announcement by Holdings or the proposed acquirer that (i) the proposed acquirer has entered into one or
more binding agreements with Holdings or shareholders of Holdings that would give rise to a Change of Control or (ii) the proposed acquirer has commenced an offer to acquire outstanding Voting
Stock of Holdings.
"Rating
Decline" shall be deemed to occur if on the 60th day following the occurrence of a Change of Control the rating of the Notes by two Rating Organizations, if the Notes are
rated by all three Rating Organizations, or either Rating Organization, if the Notes are only rated by two Rating Organizations, shall have been (i) withdrawn or (ii) downgraded, by one
or more degradations, from the ratings in effect on the Rating Date.
"Rating
Organizations" means the following nationally recognized rating organizations: Moody\'s, S&P and Fitch or, if any of Moody's, S&P or Fitch or all three shall not make a rating on
the Notes publicly available, a nationally recognized rating organization, or organizations, as the case may be, selected by the Issuers that shall be substituted for any of Moody's, S&P or Fitch or
all three, as the case may be.
"Restricted
Subsidiary" means any Subsidiary of Holdings that is not an Unrestricted Subsidiary; provided, however, that the Board of
Directors of Holdings may, subject to the covenant described under the caption "Certain CovenantsRestrictions on Permitting Restricted Subsidiaries to
Become Unrestricted Subsidiaries and Unrestricted Subsidiaries to Become Restricted Subsidiaries" above, designate any Unrestricted Subsidiary (other than any Unrestricted
Subsidiary of which the majority of the Voting Stock is owned directly or indirectly by one or more Unrestricted Subsidiaries) as a Restricted Subsidiary.
"S&P"
means Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc, or any successor rating agency.
"SEC"
means the U.S. Securities and Exchange Commission.
"Securitization
Assets" means the accounts receivable, lease, royalty or other revenue streams and other rights to payment and all related assets (including contract rights, books and
records, all collateral securing any and all of the foregoing, all contracts and all guarantees or other obligations in respect of any and all of the foregoing and other assets that are customarily
transferred or in respect of which security interests are customarily granted in connection with asset securitization transactions involving any and all of the foregoing) and the proceeds thereof, in
each case pursuant to a Securitization Financing.
"Securitization
Financing" means one or more transactions or series of transactions that may be entered into by Holdings or any Subsidiary of Holdings pursuant to which Holdings or any
Subsidiary of Holdings may sell, convey or otherwise transfer Securitization Assets to
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(a) a
Securitization Subsidiary (in the case of a transfer by Holdings or any of its Subsidiaries that is not a Securitization Subsidiary) or (b) any other Person (in the case of a
transfer by a Securitization Subsidiary), or may grant a security interest in, any Securitization Assets of Holdings or any Subsidiary of Holdings.
"Securitization
Subsidiary" means a Subsidiary (or another Person formed for the purposes of engaging in a Qualified Securitization Financing in which Holdings or any Subsidiary of
Holdings makes an investment and to which Holdings or any Subsidiary of Holdings transfers Securitization Assets and related assets) that engages in no activities other than in connection with the
financing of Securitization Assets of Holdings or a Subsidiary of Holdings, all
proceeds thereof and all rights (contingent and other), collateral and other assets relating thereto, and any business or activities incidental or related to such business, and that is designated by
the Board of Directors of Holdings or such other Person (as provided below) as a Securitization Subsidiary and (a) no portion of the indebtedness or any other obligations (contingent or
otherwise) of which (i) is guaranteed by Holdings or any Subsidiary of Holdings, other than another Securitization Subsidiary (excluding guarantees of obligations pursuant to Standard
Securitization Undertakings), (ii) is recourse to or obligates Holdings or any Subsidiary of Holdings, other than another Securitization Subsidiary, in any way other than pursuant to Standard
Securitization Undertakings or (iii) subjects any property or asset of Holdings or any Subsidiary of Holdings, other than another Securitization Subsidiary, directly or indirectly, contingently
or otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization Undertakings and (b) to which none of Holdings or any other Subsidiary of Holdings, other than another
Securitization Subsidiary, has any obligation to maintain or preserve such entity's financial condition or cause such entity to achieve certain levels of operating results. Any such designation by the
Board of Directors of Holdings or such other Person shall be evidenced by a resolution of the Board of Directors of Holdings or such other Person giving effect to such designation.
"Significant
Subsidiary" means any Restricted Subsidiary that would be a "significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Securities Act of 1933, as amended.
"Standard
Securitization Undertakings" means representations, warranties, covenants and indemnities entered into by Holdings or any of its Subsidiaries that are customary for a seller or
servicer of assets in a Securitization Financing.
"Subsidiary"
means, with respect to any specified Person, a corporation, limited liability company, partnership or trust more than 50% of the outstanding Voting Stock of which is owned,
directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person (or a combination thereof).
"Subsidiary
Guarantor" means each of the Subsidiaries of Holdings (other than the Issuers) party to the Indenture as of the Issue Date, together with any other Subsidiary of Holdings
required to become a Guarantor under the Indenture in the future.
"Treasury
Rate" means, as of any redemption date, the rate per annum equal to the yield to maturity as of such redemption date of United States Treasury securities with a constant
maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15(519) that has become publicly available at least two Business Days prior to the redemption date
(or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to the stated maturity date of
the Notes to be redeemed, as determined by the Issuers; provided, however, that if the period from the
redemption date to the stated maturity date of the Notes
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to
be redeemed is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used.
"Unrestricted
Subsidiary" means (i) any Subsidiary of Holdings (other than the Issuers and ILFC) that is designated by the Board of Directors of Holdings as an Unrestricted
Subsidiary, and (ii) any other Subsidiary of Holdings (other than the Issuers and ILFC) of which the majority of the Voting Stock is owned directly or indirectly by one or more Unrestricted
Subsidiaries.
"U.S.
Government Obligations" means securities that are:
- (1)
- direct
obligations of the United States of America for the payment of which its full faith and credit is pledged, or
- (2)
- obligations
of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America, the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United States of America.
In
either case, the U.S. Government Obligations may not be callable or redeemable at the option of the issuer, and shall also include a depository receipt issued by a bank, as defined in
Section 3(a)(2) of the Securities Act of 1933, as amended, as custodian with respect to such U.S. Government Obligation or a specific payment of principal of or interest on such U.S. Government
Obligation held by the custodian for the account of the holder of such depository receipt. The custodian is not authorized, however, to make any deduction from the amount payable to the holder of the
depository receipt except as required by law.
"Voting
Stock" of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.
"Wholly-Owned
Restricted Subsidiary" means any Wholly-Owned Subsidiary that is a Restricted Subsidiary.
"Wholly-Owned
Subsidiary" of any Person means a Subsidiary of such Person, 100% of the outstanding Capital Stock or other ownership interests of which (other than directors' qualifying
shares) shall at the time be owned by such Person or by one or more Wholly-Owned Subsidiaries of such Person.
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BOOK-ENTRY, DELIVERY AND FORM OF SECURITIES
We will issue the Notes in the form of one or more global securities. We will deposit these global securities with, or on behalf of,
DTC and register these securities in the name of DTC's nominee. Direct and indirect participants in DTC will record beneficial ownership of the Notes by individual investors. The transfer of ownership
of beneficial interests in a global security will be effected only through records maintained by DTC or its nominee, or by participants or persons that hold through participants.
Investors
may elect to hold beneficial interests in the global securities through either DTC, or Euroclear if they are participants in these systems, or indirectly through organizations
which are participants in these systems. Upon receipt of any payment in respect of a global security, DTC or its nominee will immediately credit participants' accounts with amounts proportionate to
their respective beneficial interests in the principal amount of the global security as shown in the records of DTC or its nominee. Payments by participants to owners of beneficial interests in a
global security held through participants will be governed by standing instructions and customary practices and will be the responsibility of those participants.
DTC
holds securities of institutions that have accounts with it or its participants. Through its maintenance of an electronic book-entry system, DTC facilitates the clearance and
settlement of securities transactions among its participants and eliminates the need to deliver securities certificates physically. DTC's participants include securities brokers and dealers, including
the underwriters, banks, trust companies, clearing corporations and other organizations. DTC is owned by a number of its participants and by the New York Stock Exchange, Inc., the American
Stock Exchange, Inc. and the National Association of Securities Dealers, Inc. Access to DTC's book-entry system is also available to others such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a participant, either directly or indirectly.
DTC
agrees with and represents to its participants that it will administer its book-entry system in accordance with its rules and bylaws and requirements of law. The rules applicable to
DTC and its participants are on file with the SEC.
Clearstream
and Euroclear will hold interests on behalf of their participants through customers' securities accounts in Clearstream's and Euroclear's names on the books of their
respective depositaries, which in turn will hold interests in customers' securities accounts in the depositaries' names on the books of DTC.
Clearstream
holds securities for its participating organizations, or "Clearstream Participants," and facilitates the clearance and settlement of securities transactions between
Clearstream Participants through electronic book-entry changes in accounts of Clearstream Participants, thereby eliminating the need for physical movement of certificates. Clearstream provides to
Clearstream Participants, among other things, services for safekeeping, administration, clearance and settlement of internationally traded securities and securities lending and borrowing. Clearstream
interfaces with domestic markets in several countries.
Clearstream
is registered as a bank in Luxembourg and as such is subject to regulation by the Commission de Surveillance du Secteur
Financier and the Banque Centrale du Luxembourg, which supervise and oversee the activities of Luxembourg banks. Clearstream
Participants are worldwide financial institutions, including underwriters, securities brokers and dealers, banks, trust companies and clearing corporations, and may include the underwriters or their
affiliates. Indirect access to Clearstream is available to other institutions that clear through or maintain a custodial relationship with a Clearstream Participant. Clearstream has
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established
an electronic bridge with Euroclear as the operator of the Euroclear System, or the "Euroclear Operator," in Brussels to facilitate settlement of trades between Clearstream and the
Euroclear Operator.
Distributions
with respect to the Notes of a series held beneficially through Clearstream will be credited to cash accounts of Clearstream Participants in accordance with its rules and
procedures, to the extent received by the U.S. depositary for Clearstream.
Euroclear
holds securities and book-entry interests in securities for participating organizations, or "Euroclear Participants" and facilitates the clearance and settlement of securities
transactions between Euroclear Participants, and between Euroclear Participants and participants of certain other securities intermediaries through electronic book-entry changes in accounts of such
participants or other securities intermediaries. Euroclear provides Euroclear Participants with, among other things, safekeeping, administration, clearance and settlement, securities lending and
borrowing, and related services.
Euroclear
Participants are investment banks, securities brokers and dealers, banks, central banks, supranationals, custodians, investment managers, corporations, trust companies and
certain other organizations and may include the underwriters or their affiliates. Non-participants in Euroclear may hold and transfer beneficial interests in a global security through accounts with a
Euroclear Participant or any other securities intermediary that holds a book-entry interest in a global security through one or more securities intermediaries standing between such other securities
intermediary and Euroclear.
Distributions
with respect to the Notes held beneficially through Euroclear will be credited to the cash accounts of Euroclear Participants in accordance with the terms and conditions,
to the extent received by the U.S. depositary for Euroclear.
Transfers
between Euroclear Participants and Clearstream Participants will be effected in the ordinary way in accordance with their respective rules and operating procedures.
Cross-market
transfers between DTC's participating organizations, or the "DTC Participants," on the one hand, and Euroclear Participants or Clearstream Participants, on the other hand,
will be effected through DTC in accordance with DTC's rules on behalf of Euroclear or Clearstream, as the case may be, by its U.S. Depositary; however, such cross-market transactions will require
delivery of instructions to Euroclear or Clearstream, as the case may be, by the counterparty in such system in accordance with the rules and procedures and
within the established deadlines (European time) of such system. Euroclear or Clearstream, as the case may be, will, if the transaction meets its settlement requirements, deliver instructions to its
U.S. Depositary to take action to effect final settlement on its behalf by delivering or receiving interests in the global security in DTC, and making or receiving payment in accordance with normal
procedures for same-day fund settlement applicable to DTC. Euroclear Participants and Clearstream Participants may not deliver instructions directly to their respective U.S. Depositaries.
Due
to time zone differences, the securities accounts of a Euroclear Participant or Clearstream Participant purchasing an interest in a global security from a DTC Participant in DTC will
be credited, and any such crediting will be reported to the relevant Euroclear Participant or Clearstream Participant during the securities settlement processing day (which must be a business day for
Euroclear or Clearstream) immediately following the settlement date of DTC. Cash received in Euroclear or Clearstream as a result of sales of interests in a global security by or through a Euroclear
Participant or Clearstream Participant to a DTC Participant will be received with value on the settlement date of DTC but will be available in
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the
relevant Euroclear or Clearstream cash account only as of the business day for Euroclear or Clearstream following DTC's settlement date.
The
information in this section concerning DTC, Euroclear and Clearstream and their book-entry systems has been obtained from sources that we believe to be reliable, but we take no
responsibility for the accuracy of that information.
Neither
we nor the trustee will have any responsibility for the performance by Euroclear or Clearstream or their respective participants of their respective obligations under the rules
and procedures governing their operations.
Although
DTC, Clearstream and Euroclear have agreed to the foregoing procedures in order to facilitate transfers of securities among participants of DTC, Clearstream and Euroclear, they
are under no obligation to perform or continue to perform such procedures and they may discontinue the procedures at any time.
Global Clearance and Settlement Procedures
Initial settlement for the Notes will be made in immediately available funds. Secondary market trading between DTC participants will
occur in the ordinary way in accordance with DTC rules and will be settled in immediately available funds using DTC's Same-Day Funds Settlement System.
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CERTAIN IRISH, NETHERLANDS AND U.S. FEDERAL INCOME TAX CONSEQUENCES
The following discussion, subject to the limitations set forth below, describes material tax consequences of
Ireland, the Netherlands and the United States relating to your ownership and disposition of notes. This discussion is based on laws, regulations, rulings and decisions now in effect in Ireland, the
Netherlands and the United States, which, in each case, may change. Any change could apply retroactively and could affect the continued validity of this discussion. This discussion does not purport to
be a complete analysis of all tax consequences in Ireland, the Netherlands or the United States, and this discussion does not describe all of the tax consequences that may be relevant to you or your
situation, particularly if you are subject to special tax rules. You should consult your tax advisors about the tax consequences of holding the Notes, including the relevance to your particular
situation of the considerations discussed below, as well as of state, local and other tax laws.
Certain Irish Tax Consequences
The following general summary describes certain Irish tax consequences of acquisition, holding and disposal of the Notes. This summary
is based on the Irish tax law and published practice of the Revenue Commissioners as in effect on the date of this prospectus supplement and both are subject to change possibly with retroactive
effect. Holders or prospective holders of notes should consult with their tax advisers with regard to the tax consequences of investing in the Notes in their particular circumstances. The discussion
below is included for general information purposes only.
Withholding Tax
In general, tax at the standard rate of income tax (currently 20%) is required to be withheld from payments of Irish source interest.
An exemption from withholding on interest payments exists, however, under Section 64 of the Taxes Consolidation Act, 1997 (the "1997 Act") for certain interest bearing securities issued by a
company which are quoted on a recognized stock exchange (which should include the Global Exchange Market of the Irish Stock Exchange) ("quoted Eurobonds").
Any
interest paid on such quoted Eurobonds can be paid free of withholding tax provided:
- 1.
- the
person by or through whom the payment is made is not in Ireland; or
- 2.
- the
payment is made by or through a person in Ireland, and either:
- (a)
- the
quoted Eurobond is held in a clearing system recognized by the Irish Revenue Commissioners (DTC, Euroclear, Clearstream Banking SA and
Clearstream Banking AG are so recognized); or
- (b)
- the
person who is the beneficial owner of the quoted Eurobond and who is beneficially entitled to the interest is not resident in Ireland and has made a
declaration to the person by or through whom the payment is made in the prescribed form.
So
long as the Notes are quoted on a recognized stock exchange and are held in DTC, Euroclear, Clearstream Banking SA, Clearstream Banking AG or another clearing system recognized
by the Irish Revenue Commissioners, interest on the Notes can be paid by the Irish Issuer and any paying agent outside Ireland without any withholding or deduction for or on account of Irish income
tax.
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In
other circumstances, where the exemption under Section 64 of the 1997 Act does not apply, interest payments on the Notes should be subject to Irish withholding tax at the
standard income tax rate unless another exemption under Irish domestic law applies or relief is available and is claimed under the provisions of a double taxation treaty between Ireland and the
country of tax residence of the noteholder. In this regard, Ireland has tax treaties with a number of jurisdictions which, under certain circumstances, reduce the rate of Irish withholding tax on
payments of interest to persons resident in those jurisdictions.
Taxation of Noteholders
Notwithstanding that a holder may receive interest on the Notes free of withholding tax, the holder may still be liable to pay Irish
income tax. Interest paid on the Notes may have an Irish source and therefore be within the charge to Irish income tax, PRSI and the Universal Social Charge. Ireland operates a self assessment system
in respect of income tax and any person, including a person who is neither resident nor ordinarily resident in Ireland, with Irish source income comes within its scope.
Certain
categories of taxpayer may be exempt from taxation of interest:
-
- A person will be exempt from Irish tax on interest on the Notes where the Notes qualify for the Eurobond exemption from withholding
tax as described above; provided that the person does not carry on a trade in Ireland through a branch or agency to which the interest is attributable
and the person is not resident in Ireland and is resident in a Member State of the EU under the law of that Member State or in a country with which Ireland has a double taxation agreement under the
terms of that agreement.
-
- A person will also be exempt from Irish tax on interest on the Notes where the Notes qualify for the quoted Eurobond exemption from
withholding tax as described above and where the person is either:
- (i)
- a
company which is under the control, whether directly or indirectly, of persons(s) who by virtue of the laws of a Member State of the EU (other than
Ireland) or a country with which Ireland has a double taxation agreement are resident for the purposes of tax in that jurisdiction and are not under the control of persons(s) who are not so resident
in a Member State of the EU (other than Ireland) or a country with which Ireland has a double taxation agreement; or
- (ii)
- a
company, or a 75%-owned subsidiary of a company or companies, the principal class of shares in which is substantially and regularly traded on a
recognised stock exchange in an EU member state or in a country with which Ireland has a double tax agreement,
provided the company does not carry on a trade in Ireland through a branch or agency to which the interest is attributable.
-
- Under Irish domestic law, a company that is not resident in Ireland and is resident either in a Member State of the EU or in a country
with which Ireland has a double taxation agreement which imposes a tax that generally applies to interest receivable in that territory by companies from sources outside that territory or where the
interest payable is exempted from the charge to tax under the relevant double tax agreement, will be exempt from Irish tax on any interest received on the Notes or would be exempted if the relevant
double tax agreement had the force of law when the interest was paid provided it does not carry on a trade in Ireland through a branch or agency to which this interest is attributable and as long as
the Issuer is making the interest payments in the ordinary course of its trade or business.
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-
- In addition, an exemption from Irish tax may also be available under the terms of an applicable double tax agreement to certain
persons entitled to the benefits of such an agreement.
Holders
receiving interest on the Notes which does not fall within any of the above exemptions may be liable to Irish income tax, PRSI and the Universal Social Charge on such interest.
A
corporate noteholder that carries on a trade in Ireland through a branch or agency in respect of which the Notes are held or attributed, may have a liability to Irish corporation tax
on the Notes (including the interest arising on the Notes).
Encashment Tax
In certain circumstances, Irish encashment tax may be required to be withheld at the standard rate (currently 20%) from interest on any
notes, where such interest is collected by a person in Ireland on behalf of any noteholder. If a noteholder appoints an Irish collecting agent, then an exemption from Irish encashment tax should be
available where the beneficial owner of the interest is not resident in Ireland and has made a declaration to this effect in the prescribed form to the collecting agent.
Deposit Interest Retention Tax ("DIRT")
The interest on the Notes should not be liable to DIRT on the basis that the Issuer is not a deposit taker as defined in Irish tax law.
Capital Gains Tax
Capital gains tax is chargeable at the rate of 33% on taxable capital gains (calculated in euros). The Notes are chargeable assets for
Irish capital gains tax purposes. Persons who are neither resident nor ordinarily resident in Ireland, however, are only liable for capital gains tax on the disposal of the Notes where the Notes have
been used in or held or acquired for use by or for the purposes of a branch or agency.
Domicile Levy
Irish domiciled individuals who are neither resident nor ordinarily resident in Ireland may be subject to the domicile levy as a
consequence of owning the Notes.
Capital Acquisitions Tax
A gift or inheritance comprising of notes will be within the charge to capital acquisitions tax if either (i) the disponer or
the donee/successor in relation to the gift or inheritance is resident or ordinarily resident in Ireland or (ii) if the Notes are regarded as
property situate in Ireland. Special rules with regard to residence apply where an individual is not domiciled in Ireland. The Notes may be regarded as situated in Ireland for Irish capital
acquisition purposes. Accordingly, if such notes are comprised in a gift or inheritance, the gift or inheritance may be within the charge to tax regardless of the residence status of the disponer or
the donee/successor.
Stamp Duty
No stamp duty, stamp duty reserve tax or issue, documentary, registration or other similar tax imposed by any government department or
other taxing authority of or in Ireland
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(collectively
"Irish stamp duty") should be payable on the creation, initial issue or delivery of notes.
The
Notes should be considered loan capital within the meaning of Section 85 of the Stamp Duties Consolidation Act, 1999, and on the basis that the issue price is not less than
90% of their nominal value, the transfer of any interest in such notes therein by written instrument or by book entry should not attract Irish stamp duty. Any Irish stamp duty charged would be at the
rate of one per cent of the amount of the consideration for the transfer or, if greater, the market value of the interest in the Notes being transferred.
EU Savings Directive
The regulations (EC (Taxation of Savings Income in the form of Interest Payments) Regulations 2003) implementing in Ireland the
EU Directive on the Taxation of Savings Income provide for various reporting requirements for paying agents in respect of interest payments made to individuals resident in other member states of the
EU. These reporting requirements do not apply where: (1) payments of interest on the Notes will be made by the Trustee or the paying agent, (2) neither the Trustee nor the paying agents
carries
on a trade in Ireland through a branch or agency to which its activities as paying agent are attributable and (3) the payments are not made through a residual entity (essentially an
intermediary through which interest payments are made) in Ireland.
Certain Netherlands Tax Consequences
General
The following is a general summary of certain Netherlands tax consequences of the acquisition, holding and disposal of the Notes. This
summary does not purport to describe all possible tax consequences that may be relevant to a holder or prospective holder of notes and does not purport to deal with the tax consequences applicable to
all categories of investors, some of which (such as trusts or similar arrangements) may be subject to special rules. In view of its general nature, it should be treated with corresponding caution.
Holders or prospective holders of notes should consult with their tax advisers with regard to the tax consequences of investing in the Notes in their particular circumstances. The discussion below is
included for general information purposes only.
Except
as otherwise indicated, this summary only addresses Netherlands national tax legislation and published regulations, whereby the Netherlands means the part of the Kingdom of the
Netherlands located in Europe, as in effect on the date hereof and as interpreted in published case law until this date, without prejudice to any amendment introduced at a later date and implemented
with or without retroactive effect.
Withholding tax
All payments of principal or interest made by the Issuers under the Notes may be made free of withholding or deduction of or, for any
taxes of whatever nature imposed, levied, withheld or assessed by the Netherlands or any political subdivision or taxing authority thereof or therein.
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Taxes on income and capital gains
Please note that the summary in this section does not describe the Netherlands tax consequences for:
- (i)
- holders
of notes if such holders, and in the case of individuals, his/her partner or certain of their relatives by blood or marriage in the direct line
(including foster children), have a substantial interest or deemed substantial interest in the Issuer under the Netherlands Income Tax Act 2001 (in Dutch: "Wet
inkomstenbelasting 2001"). Generally speaking, a holder of securities in a company is considered to hold a substantial interest in such company, if such holder alone or, in the
case of individuals, together with his/her partner (as defined in the Netherlands Income Tax Act 2001), directly or indirectly, holds (i) an interest of 5% or more of the total issued and
outstanding capital of that company or of 5% or more of the issued and outstanding capital of a certain class of shares of that company; or (ii) rights to acquire, directly or indirectly, such
interest; or (iii) certain profit sharing rights in that company that relate to 5% or more of the company's annual profits or to 5% or more of the company's liquidation proceeds. A deemed
substantial interest may arise if a substantial interest (or part thereof) in a company has been disposed of, or is deemed to have been disposed of, on a non-recognition basis;
- (ii)
- pension
funds, investment institutions (in Dutch: "fiscale beleggingsinstellingen"), exempt investment
institutions (in Dutch: "vrijgestelde beleggingsinstellingen") (as defined in the Netherlands Corporate Income Tax Act 1969; in Dutch:
"Wet op de vennootschapsbelasting 1969") and other entities that are, in whole or in part, not subject to or exempt from corporate income tax; and
- (iii)
- holders
of notes who are individuals for whom the Notes or any benefit derived from the Notes are a remuneration or deemed to be a remuneration for
activities performed by such holders or certain individuals related to such holders (as defined in the Netherlands Income Tax Act 2001).
Residents of the Netherlands Generally speaking, if the holder of the Notes is an entity that is a resident or deemed to be resident of
the
Netherlands for Netherlands corporate income tax purposes, any income derived from the Notes or any gain or loss realized on the disposal or deemed disposal of the Notes is subject to Netherlands
corporate income tax at a rate of 20% with respect to taxable profits up to €200,000 and 25% with respect to taxable profits in excess of that amount.
If
a holder of the Notes is an individual, resident or deemed to be resident of the Netherlands for Netherlands income tax purposes, any income derived from the Notes or any gain or loss
realized on the disposal or deemed disposal of the Notes is taxable at the progressive income tax rates (with a maximum of 52%), if:
- (i)
- the
Notes are attributable to an enterprise from which the holder of the Notes derives a share of the profit, whether as an entrepreneur or as a person who
has a co-entitlement to the net worth (in Dutch: "medegerechtigd tot het vermogen") of such enterprise without being a shareholder (as defined in the
Netherlands Income Tax Act 2001); or
- (ii)
- the
holder of the Notes is considered to perform activities with respect to the Notes that go beyond ordinary asset management (in Dutch:
"normaal, actief vermogensbeheer") or derives benefits from the Notes that are taxable as benefits from other activities (in Dutch:
"resultaat uit overige werkzaamheden").
If
the above-mentioned conditions (i) and (ii) do not apply to the individual holder of the Notes, such holder will be taxed annually on a deemed income of 4% of his/her
net
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investment
assets for the year at an income tax rate of 30%. The net investment assets for the year are the fair value of the investment assets less the allowable liabilities on 1 January of
the relevant calendar year. The Notes are included as investment assets. A tax free allowance may be available. Actual income, gains or losses in respect of the Notes are not subject to Netherlands
income tax.
Non-Residents of the Netherlands A holder of the Notes that is neither resident nor deemed to be resident of the Netherlands will not
be subject to
Netherlands taxes on income or capital gains in respect of any income derived from the Notes or in respect of any gain or loss realized on the disposal or deemed disposal of the Notes, provided
that:
- (i)
- such
holder does not have an interest in an enterprise or deemed enterprise (as defined in the Netherlands Income Tax Act 2001 and the Netherlands Corporate
Income Tax Act 1969), which, in whole or in part, is either effectively managed in the Netherlands or carried on through a permanent establishment, a deemed permanent establishment or a permanent
representative in the Netherlands and to which enterprise or part of an enterprise the Notes are attributable; and
- (ii)
- in
the event the holder is an individual, such holder does not carry out any activities in the Netherlands with respect to the Notes that go beyond
ordinary asset management and does not derive benefits from the Notes that are taxable as benefits from other activities in the Netherlands.
Gift and Inheritance Taxes
Residents of the Netherlands Gift or inheritance taxes will arise in the Netherlands with respect to a transfer of the Notes by way of
a gift by, or
on the death of, a holder of such notes who is resident or deemed resident of the Netherlands at the time of the gift or his/her death. For purposes of Netherlands gift and inheritance taxes, an
individual holding the Netherlands nationality will be deemed to be resident in the Netherlands if such individual has been resident in the Netherlands at any time during the 10 years preceding
the date of the gift or his/her death. Additionally, for purposes of Netherlands gift tax, an individual not holding the Netherlands nationality will be deemed to be resident in the Netherlands if
such individual has been resident in the Netherlands at any time during the 12 months preceding the date of the gift.
Non-Residents of the Netherlands No Netherlands gift or inheritance taxes will arise on the transfer of notes by way of gift by, or on
the death of,
a holder of notes who is neither resident nor deemed to be resident in the Netherlands.
Based
on legal fictions in Netherlands tax law, certain transactions undertaken during the lifetime of a holder of notes, even if such holder at the time of such a transaction was
neither resident nor deemed to be resident in the Netherlands, are taxed with Netherlands inheritance tax when the holder of notes dies as a resident or deemed resident of the Netherlands. Examples of
such transactions are transfers of ownership under which the holder of notes keeps the usufruct, gifts made under condition precedent and gifts made within 180 days before the death of the
donor.
Value-Added Tax (VAT)
No Netherlands VAT will be payable by the holders of the Notes on (i) any payment in consideration for the issue of the Notes or
(ii) the payment of interest or principal by the Issuer under the Notes.
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Other Taxes and Duties
No Netherlands registration tax, stamp duty or any other similar documentary tax or duty will be payable by the holders of the Notes in
respect or in connection with:
- (i)
- the
payment of interest or principal by the Issuer under the Notes; or
- (ii)
- the
transfer of the Notes.
Certain U.S. Federal Income Tax Consequences
The following discussion, subject to the limitations and conditions set forth herein, describes the material U.S. federal income tax
consequences to U.S. Holders (as defined below) of owning and disposing of notes. The discussion is only applicable to U.S. Holders that hold notes as "capital assets" (generally for investment
purposes), and who are initial purchasers of the Notes at their initial "issue price" (the initial offering price offered to the public, excluding bond houses and brokers, at which price a substantial
amount of the Notes is sold). This discussion also assumes that the Notes will not be issued with more than a de minimis amount of original issue
discount for U.S. federal income tax purposes. This discussion does not address all aspects of U.S. federal income taxation that may be applicable to a U.S. Holder subject to special treatment under
U.S. federal income tax law (including, but not limited to, persons subject to the alternative minimum tax, banks, tax-exempt organizations, governmental organizations, regulated investment companies,
real estate investment trusts, insurance companies and dealers in securities or foreign currencies, traders who elect to mark their investment to market, partnerships or other pass-through entities,
holders who have a functional currency other than the U.S. dollar, or holders that hold notes as part of a hedge, constructive sale, straddle, conversion or integrated transaction).
In
addition, except as otherwise specifically provided above, there is no discussion of state, local, or non-U.S. tax consequences of the ownership or disposition of notes. This
discussion does not address any U.S. federal tax consequences other than U.S. federal income tax consequences, such as the estate and gift tax, the alternative minimum tax and the Medicare tax on net
investment income. The discussion below is based upon the provisions of the Code, U.S. Treasury regulations, rulings and other pronouncements of the U.S. Internal Revenue Service (the "IRS") and
judicial decisions as of the date hereof. Such authorities may be repealed, revoked or modified (with possible retroactive effect) so as to result in U.S. federal income tax consequences different
from those discussed below.
Holders
of notes are urged to consult their own independent tax advisors concerning the U.S. federal income tax consequences of ownership and disposition of notes in light of their
particular situations, as well as any consequences arising under the laws of any other taxing jurisdiction.
The
treatment of the Notes for U.S. federal income tax purposes is unclear in certain respects due to the absence of authorities that directly address the treatment of debt obligations
that have both U.S. and non-U.S. coobligors. All of the proceeds of this offering of the Notes will be received by the Irish Issuer. The Issuers will enter into a Reimbursement Agreement pursuant to
which (i) all payments on the Notes will be made by the Irish Issuer and (ii) notwithstanding the foregoing, in the event that the U.S. Issuer makes a payment on or with respect to a
note, the Irish Issuer will promptly reimburse the U.S. Issuer for such payment (plus interest thereon). This Reimbursement Agreement will be binding upon the successors (if any) of the Issuers. For
U.S. federal income tax purposes, we intend to treat (i) the Notes as debt of the Irish Issuer and (ii) interest payments on the Notes as interest from sources outside the U.S. We cannot
assure you, however, that the IRS will not challenge
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this
treatment or, if the IRS were to challenge this treatment, that a court would not agree with the IRS. If the IRS were to successfully challenge this treatment, the tax consequences of Holders
would be different from those described below. Holders, and Non-U.S. Holders (as defined below) in particular, are urged to consult with their own tax advisers with regard to the source of interest on
the Notes.
As
used herein, the term "U.S. Holder" means a beneficial owner of notes that is (i) an individual who is a citizen or resident of the United States, (ii) a corporation, or
other entity treated as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States, any State thereof or the District of Columbia,
(iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source, or (iv) a trust (X) that is subject to the supervision of a court within
the United States and the control of one or more United States persons as described in Section 7701(a)(30) of the Code or (Y) that has a valid election in effect under applicable U.S.
Treasury regulations to be treated as a United States person.
If
a partnership (or an entity classified as a partnership for U.S. federal income tax purposes) holds notes, the tax treatment of a partner in the partnership will generally depend upon
the status of the partner and the activities of the partnership. A U.S. Holder that is a partner of a partnership holding notes is urged to consult its tax advisors regarding the consequences of the
ownership or disposition of notes.
Potential Contingent Payment Debt Treatment
Certain debt instruments that provide for one or more contingent payments are subject to U.S. Treasury regulations governing contingent
payment debt instruments. A payment is not treated as a contingent payment under these regulations if, as of the issue date of the debt instrument, the likelihood that such payment will be made is
remote or the payments are incidental. In certain circumstances as set forth in the "Description of the Notes", we may redeem the Notes in advance of their stated maturity, in which case we may pay
amounts on the Notes that are in excess of the stated interest or principal of the Notes. We believe, however, the potential under the terms of the note for payments in excess of stated interest and
principal, e.g., in the event of a Change of Control Triggering Event, is remote or incidental and therefore the Notes are not subject to the rules governing contingent debt instruments.
Accordingly, we do not intend to treat the potential payment of such amounts as part of the yield to maturity of the Notes. Our position is binding on you unless you disclose that you are taking a
contrary position in the manner required by applicable U.S. Treasury regulations. Our position is not, however, binding on the IRS, and if the IRS were to challenge this position, you might be
required to use the accrual method, even if you were otherwise a cash method taxpayer, to take into account interest income on the Notes and to treat as ordinary income rather than capital gain any
income that you realize on the taxable disposition of a note. The remainder of this discussion assumes that the Notes will not be treated as contingent payment debt instruments.
Taxation of Payments of Interest and Additional Amounts
Interest paid on a note (including additional amounts, if any) will be included in the gross income of a U.S. Holder as ordinary
interest income at the time it is paid or accrued, in accordance with the U.S. Holder's regular method of tax accounting. A U.S. Holder will also be required to include in gross income any withholding
tax paid with respect to interest on the Notes, including withholding tax on payments of additional amounts.
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If
withholding taxes are imposed in Ireland or in another jurisdiction, U.S. Holders will be treated as having actually received an amount equal to the amount of such taxes and as
having paid such amount to the relevant taxing authority. As a result, the amount of income included in gross income by a U.S. Holder may be greater than the amount of cash actually received by the
U.S. Holder. Subject to certain limitations, a U.S. Holder generally will be entitled to a credit against its U.S. federal income tax liability for income taxes withheld by us and remitted to Irish
tax authority or other taxing authority. Alternatively, a U.S. Holder may elect to claim a deduction for such income taxes paid to Ireland or other country in computing its U.S. federal taxable
income; provided that the election shall apply to all foreign income taxes paid or accrued by the U.S. Holder for the taxable year. U.S. Holders should consult their own tax advisors concerning the
U.S. federal income tax consequences of the imposition of such taxes.
Interest
received or accrued on the Notes and additional amounts generally will constitute foreign source income to U.S. Holders for U.S. foreign tax credit purposes. For purposes of the
foreign tax credit limitation, foreign source income is classified in one of two "baskets," and the credit for foreign taxes paid or accrued with respect to foreign source income in any basket is
limited to U.S. federal income tax allocable to that income. Interest on the Notes generally will be in the "passive category income" basket or, for certain U.S. Holders, the "general category income"
basket. The calculation of U.S. foreign tax credits and, in the case of a U.S. Holder that elects to deduct foreign taxes, the availability of deductions involve the application of complex rules that
depend on a U.S. Holder's particular circumstances. U.S. Holders should, therefore, consult their own tax advisors regarding the application of the U.S. foreign tax credit rules.
Sale, Redemption, Retirement and Other Taxable Disposition of the Notes
A U.S. Holder will generally recognize gain or loss on the sale, redemption, retirement or other taxable disposition of a note in an
amount equal to the difference between (i) the amount of cash and the fair value of property received by such U.S. Holder on such disposition (including any make-whole amount received upon
redemption, less any amounts attributable to accrued but unpaid interest which will be taxable as ordinary interest income), and (ii) the U.S. Holder's adjusted tax basis in the note at the
time of such disposition. A U.S. Holder's initial tax basis in a note will generally equal the acquisition cost of such note to the U.S. Holder. A U.S. Holder's adjusted tax basis in a note generally
will be its cost increased by the amount the U.S. Holder has included in gross income with respect to the note and decreased by the amount of any payments on the Notes other than payments of stated
interest. Gain or loss with respect to a taxable disposition of a note generally will be capital gain or loss. Capital gains of certain non-corporate U.S. Holders, including individuals, derived with
respect to capital assets held for over one year may be eligible for reduced rates of taxation. The deductibility of capital losses is subject to limitations.
Gain
or loss recognized by a U.S. Holder on the sale, redemption, retirement or other taxable disposition of a note will generally be U.S.-source gain or loss. Accordingly, if Ireland or
another jurisdiction imposes a withholding tax on the sale or disposition of the Notes, a U.S.
Holder may not be able to fully utilize its U.S. foreign tax credits in respect of such withholding tax unless such U.S. Holder has other foreign source income. Prospective investors should consult
their own tax advisors as to the U.S. federal income tax and foreign tax credit implications of such sale, redemption, retirement or other disposition of a note.
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Non-U.S. Holders
Payments on the Notes (including the amount of any Irish taxes withheld, if any, and any additional amounts) to a holder other than a
U.S. Holder (a "Non-U.S. Holder") will not be subject to United States withholding tax. A Non- U.S. Holder's net income from the Notes also will not be subject to U.S. federal income taxation unless
the income is effectively connected with such Non- U.S. Holder's conduct of a United States trade or business. Gain realized by a Non-U.S. Holder on its disposition of the Notes will not be subject to
U.S. federal income tax unless (1) the gain is effectively connected with the Non-U.S. Holder's conduct of a United States trade or business or (2) the Non-U.S. Holder is an individual
who is present in the United States for at least 183 days during the taxable year of disposition and certain other conditions are met.
Backup Withholding and Information Reporting
In general, payments of principal and interest, and payments of the proceeds of a sale, exchange or other disposition of notes, paid
within the United States or through certain United States-related financial intermediaries to a U.S. Holder may be subject to information reporting and backup withholding unless the U.S. Holder
(i) is an exempt recipient or (ii) in the case of backup withholding (but not information reporting), provides an accurate taxpayer identification number and certifies that no loss of
exemption from backup withholding has occurred.
Non-U.S.
Holders will generally not be subject to information reporting and backup withholding on payments of principal and interest, and payments of the proceeds of a sale, exchange or
other disposition of notes. Information reporting and backup withholding may
apply, however, in cases where amounts are paid within the United States or through certain United States-related financial intermediaries. Non-U.S. Holders should consult their tax advisors regarding
the application of information reporting and backup withholding in their particular situations.
Backup
withholding is not an additional tax. The amount of any backup withholding from a payment to a U.S. Holder will be allowed as a refund or a credit against the U.S. Holder's U.S.
federal income tax liability provided the required information is timely provided to the IRS.
Information with Respect to Foreign Financial Assets
U.S. Holders that are individuals that own "specified foreign financial assets" with an aggregate value in excess of $50,000 are
generally required to file an information report with respect to such assets with their tax returns, subject to certain exceptions. "Specified foreign financial assets" include any financial accounts
maintained by foreign financial institutions, as well as any of the following, but only if they are not held in accounts maintained by financial institutions: (i) stocks and securities issued
by non-U.S. persons, (ii) financial instruments and contracts held for investment that have non-U.S. issuers or counterparties and (iii) interests in foreign entities. The Notes may be
subject to these rules. U.S. Holders that are individuals are urged to consult their tax advisors regarding the application of this legislation to their ownership of the Notes.
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IRISH LAW CONSIDERATIONS
Insolvency Under Irish Law
Difference in Insolvency Law
The Irish Issuer, and a guarantor, AerCap Ireland Limited, are incorporated under the laws of Ireland (together, the "Irish Entities"
and each an "Irish Entity"). Any insolvency proceedings applicable to any of them will be likely to be governed by Irish insolvency laws. Irish insolvency laws differ from the insolvency laws of the
United States and may make it more difficult for holders of the Notes to recover the amount in respect of the Notes or an Irish guarantor's guarantee of the Notes than they would have recovered in a
liquidation or bankruptcy proceeding in the United States.
Priority of Secured Creditors
Irish insolvency laws generally recognize the priority of secured creditors over unsecured creditors. The lenders under any secured
facilities have, or will have, security interests on certain of the assets of the Issuer. The Notes and the related guarantees are unsecured.
Preferential Creditors
Under Irish law, upon the insolvency of a company that is liable to be wound up under the Irish Companies Act 2014 (the "2014 Act")
preferential debts are, pursuant to Section 621 of the 2014 Act, required to be paid in priority to all debts other than those
secured by a fixed security interest. Preferential debts therefore have priority over unsecured debts. If the assets of the relevant company available for payment of general creditors are insufficient
to pay the preferential debts, the preferential debts are required to be paid out of the assets that are not subject to a fixed security interest.
The
preferential debts will comprise, among other things, any amounts owed in respect of certain local rates and certain amounts owed to the Irish Revenue Commissioners for
income/corporation/capital gains tax, VAT, PAYE, social security and pension scheme contributions and remuneration, salary and wages of employees. In addition, the expenses of liquidation and
examinership (should either occur) of the Irish company are required to be paid ahead of the preferential creditors prescribed by the 2014 Act.
Therefore
in a winding-up of any Irish Entity, the liquidator may be required to pay amounts due to preferential creditors in advance of paying any amounts due to holders of the Notes.
Unfair Preference
Under Irish insolvency law, if an Irish company goes into liquidation, a liquidator may apply to the court to have certain transactions
set aside if the related contract amounted to an unfair preference. Section 604 of the 2014 Act provides that any conveyance, mortgage, delivery of goods, payment, execution or other act
relating to property made or done by or against an Irish company, which is unable to pay its debts as they become due in favor of any creditor or any person on trust for any creditor, with a view to
giving such creditor (or any guarantor for the debt due to such creditor) a preference over the other creditors within six months (or in the case of a connected person, two years) of the commencement
of a winding-up of the Irish company is deemed a unfair preference of its creditors and shall be invalid. Section 604 is only applicable if, at the time of the conveyance, mortgage payment or
other relevant act, the Irish company was unable to pay its debts as they became due.
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Disclaimer of Onerous Property
Section 615 of the 2014 Act confers power on a liquidator, with leave of the court, at any time within 12 months after
the commencement of the liquidation (or such extended period as may be allowed by the Court), to disclaim any property of the company being wound up which consists of, amongst other things,
(a) unprofitable contracts or (b) any property which is unsaleable or not readily saleable by reason of its binding the possessor to the performance of any onerous act or to the payment
of money. Where a disclaimer is allowed by the court, the company is relieved of continuous and onerous obligations (and any future benefits), but, the other party to the contract obtains the right to
prove in the liquidation for the losses sustained by it as a result of the disclaimer. A liquidator must disclaim the whole of the property; he may not keep part and disclaim part. A disclaimer
terminates as and from the date of the disclaimer, the rights, interests and liabilities of the
company in the contract or the property, but, the disclaimer does not affect the rights or liabilities of any other person, except so far as necessary for the purpose of releasing the company from
liability.
Examinership
Examinership is a court procedure available under Part 10 of the 2014 Act to facilitate the survival of Irish companies, such as
the Irish Entities, in financial difficulties.
In
circumstances where an Irish company is or is likely to be unable to pay its debts, then that company, the directors of that company, a contingent, prospective or actual creditor of
that company, or shareholders of that company holding, at the date of presentation of the petition, not less than one-tenth of the voting share capital of that company, are each entitled to petition
the court for the appointment of an examiner to that company. Where the Irish High Court appoints an examiner to a company, it may, at the same or any time thereafter, make an order appointing the
examiner to be examiner for the purposes of the 2014 Act to a related company of such company. The examiner, once appointed, has the power to set aside contracts and arrangements entered into by the
company after this appointment and, in certain circumstances, can avoid a negative pledge given by the company prior to this appointment. Furthermore, the examiner may sell assets, the subject of a
fixed security interest. If such power is exercised the examiner must account to the holders of the fixed security interest for the amount realized and discharge the amount due to the holders of the
fixed security interest out of the proceeds of the sale.
During
the period of protection, the examiner will formulate proposals for a compromise or scheme of arrangement to assist the survival of the company, or of the related company, or
both, and the whole or any part of its or their undertaking as a going concern. A scheme of arrangement may be approved by the Irish High Court (or the Irish Circuit Court where the petition is
presented in respect of a "small company") when at least one class of creditors has voted in favor of the proposals and the Irish High Court is satisfied that such proposals are fair and equitable in
relation to any class of members or creditors that has not accepted the proposals and whose interests would be impaired by implementation of the scheme of arrangement, and the proposals are not
unfairly prejudicial to the interests of any interested party. Further the Courts shall not confirm proposals for schemes of arrangement which have the effect of impairing the creditors of that
company in such a manner as to unfairly favor the interest of the creditors or members of a related company in examinership.
Under
Section 537 of the 2014 Act, where proposals for a compromise or scheme of arrangement are to be formulated in relation to a company, for the survival of the company in
examinership and the whole or part of its undertaking as a going concern, the company (but not the examiner) may, subject to the approval of the court, affirm or repudiate any contract
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under
which some element of performance (other than payment) remains to be rendered both by the company and the other contracting party or parties. Any person who suffers loss or damage as a result of
such repudiation stands as an unsecured creditor for the amount of such loss or damage and their claim may be dealt with by the examiner under the proposed scheme of arrangement.
The
Irish Circuit Court has jurisdiction to hear a petition for the appointment of an examiner in respect of small companies. A "small company" under the 2014 Act is a company which
satisfies at least two of the following conditions in that the financial year immediately proceeding the presentation of the petition: (i) it has a balance sheet now in excess of
€4.4 million; (ii) it has a turnover not in excess of €8.8 million; and (iii) it has not more than 50 employees.
The
2014 Act provides, among other things, that no enforcement action or other proceedings of any sort may be commenced against the company in examinership or any guarantor in respect of
the debts of the Irish company in examinership. The primary risks to the holders of the Notes, under the laws of Ireland, if an examiner were appointed to an Irish Entity or a company related to an
Irish Entity are as follows:
- (i)
- there
may be a delay in enforcing payment obligations of the Issuer and any payment obligations contained in a guarantee given by any subsidiary guarantor;
- (ii)
- the
potential for a compromise or scheme of arrangement being approved involving the writing down or rescheduling of the debt due by the Issuer to the
holders of the Notes;
- (iii)
- the
potential for a compromise or scheme of arrangement being approved involving the writing down or rescheduling of any payment obligations owed by an
Irish guarantor under a guarantee where such an Irish guarantor is a related company to the Issuer;
- (iv)
- the
potential for the examiner to seek to set aside any negative pledge in the Notes prohibiting the creation of security or the incurring of borrowings by
the Issuer to enable the examiner to borrow to fund the Issuer during the protection period; and
- (v)
- in
the event that a scheme of arrangement is not approved in respect of the Issuer or a guarantor and the Issuer or guarantor, as the case may be,
subsequently goes into liquidation, the examiner's remuneration and expenses (including certain borrowings incurred by the examiner on behalf of the Issuer or guarantor and approved by the Irish High
Court) will take priority over the monies and liabilities which from time to time are or may become due, owing or payable to the holders of the Notes.
Irish
company law contains certain rules regarding the enforcement of guarantees in an examinership and in the event of the appointment of an examiner to the Issuer there are certain
steps which the holder of the guarantee from the guarantor(s) will have to strictly observe in order to preserve its rights to enforce the obligations of the guarantor(s) under the guarantee. In this
respect, a notice containing an offer by the holder of the guarantee to transfer to the guarantor(s) such holder's rights to vote on the examiner's proposals in respect of the Issuer must be served on
guarantor(s) within certain prescribed time limits. There is no flexibility in relation to the prescribed time limits and they must be strictly adhered to. If the creditor under the guarantee does not
comply with the notification procedure, it may not enforce, by legal proceedings or otherwise, the obligations of the guarantor(s) in respect of the debts of the Issuer pursuant to the guarantee.
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Improper Transfers
Under Section 608 of the 2014 Act, if it can be shown on the application of a liquidator, creditor or contributory of a company
which is being wound up, to the satisfaction of the Irish High Court that any property of such company was disposed of (which would include by way of transfer, mortgage or security) and the effect of
such a disposal was to "perpetrate a fraud" on the company, its creditors or members, the Irish High Court may, if it deems it just and equitable, order any person who appears to have use,
control or possession of such property or the proceeds of the sale or development thereof to deliver it or pay a sum in respect of it to the liquidator on such terms as the Irish High Court sees fit.
In deciding whether it is just and equitable to make an order under Section 608, the Irish High Court must have regard to the rights of persons who have bona fide and for value acquired an
interest in the property the subject of the application. Section 608 does not apply to a disposal that would constitute an unfair preference for the purpose of Section 604 of the 2014
Act.
Fraudulent Transfer
Section 74(3) of the Land and Conveyancing Law Reform Act 2009 provides that a conveyance of property made with the intention of
defrauding a creditor or other person is voidable by any person thereby prejudiced. The foregoing will not apply, however, to any estate or interest in property conveyed for valuable consideration to
any person in good faith not having, at the time of the conveyance, notice of the fraudulent intention.
Enforcement Process
Receivership. A receiver could be appointed by way of enforcement of the right of the holders of fixed and/or floating security
interests. Receivers
are appointed over defined assets, and not over the company itself. The realizations from the assets to which the Receiver is appointed will be applied in accordance with the rules set out in Irish
lawfirst in discharge of the costs and expenses of the receivership, then to the debts secured by fixed security, then to the debts of preferential creditors and then to the debts secured
by floating security. Only after these debts have been fully discharged will any surplus realizations from the secured assets be returned to the company to be applied towards the debts of unsecured
creditors, such as the holders of the Notes.
Guarantees. The Notes will be guaranteed by AerCap Ireland Limited, to the extent that such guarantee would not constitute the
giving of unlawful
financial assistance within the meaning
of Section 60 of the Companies Act 1963 (as amended) or Section 82 of the Companies Act 2014 (as applicable). There is a risk that the guarantees may be challenged as unenforceable on
the basis that there is an absence of corporate benefit on the part of a relevant guarantor or that it is not for the purpose of carrying on the business of a relevant guarantor. Where a guarantor is
a direct or indirect holding company of the Issuer, there is less risk of an absence of a corporate benefit on the basis that the holding company could justify the decision to give a guarantee to
protect or enhance its investment in its direct or indirect subsidiary. Where a guarantor is a direct or indirect subsidiary of the Issuer or a member of the group with a common direct or indirect
holding company, there is a greater risk of the absence of the corporate benefit. In the case of an Irish guarantor, the Irish courts have held that corporate benefit may be established where the
benefit flows to the group generally rather than specifically to the relevant Irish guarantor.
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Enforcement of Civil Liability Judgments Under Irish Law
As the United States is not a party to a convention with Ireland in respect of the enforcement of judgments, common law rules apply in
order to determine whether a judgment of the courts of the United States is enforceable in Ireland. A judgment of a court of the United States will be enforced by the courts in Ireland if the
following general requirements are met:
- (i)
- The
United States court must have jurisdiction under Irish conflict of law rules. If the Irish courts determine that the jurisdiction of the United States
court is not acceptable, then the judgment cannot be enforced or recognized in Ireland.
- (ii)
- The
judgment must be final and conclusive and the decree must be final and unalterable in the court that produces it. The enforcement of a judgment under
appeal in the United States will normally be stayed in Ireland pending the outcome of the appeal.
- (iii)
- When
enforcing an in personam judgment (action against a specific person as opposed to a judgment specific
to an asset), the amount in question must be a definite sum of money.
- (iv)
- Once
the United States court is shown to have jurisdiction, the Irish courts will not examine the merits of the judgment obtained in the United States.
- (v)
- Enforcement
proceedings should be instituted in Ireland within six years of the date of judgment.
There
are a number of possible defenses to an application to enforce a judgment of the courts of the United States in Ireland, including the following:
- (i)
- A
judgment obtained by fraud or trick will not be enforceable.
- (ii)
- A
judgment in breach of natural or constitutional justice will not be enforceable. This would include a failure to notify the other party of the hearing or
to give the other party a fair hearing.
- (iii)
- A
judgment contrary to Irish public policy is not enforceable. This would include, for example, among other things (i) a judgment obtained on foot
of a contract recognized as illegal in Ireland such as a contract in restraint of trade or (ii) a judgment granted on foot of foreign penal or revenue (tax) laws or expropriatory laws (the
latter of which would include certain laws permitting the requisitioning or confiscation of property).
- (iv)
- A
judgment inconsistent with a prior Irish judgment is not enforceable.
- (v)
- Jurisdiction
cannot be obtained by the Irish courts over judgment debtors in enforcement proceedings by personal service in Ireland or outside Ireland under
Order 11 of the Rules of the Superior Courts.
Other Irish Law Considerations
Application will be made to the Irish Stock Exchange plc for the Notes to be admitted to the Official List and to trading on the
Global Exchange Market of the Irish Stock Exchange. We cannot assure you that any such approval will be granted or, if granted, that such listing will be maintained. This prospectus does not
constitute "listing particulars" for the purposes of admission of the Notes to the Official List and to trading on the Global Exchange Market of the Irish Stock Exchange. A separate document
constituting such "listing particulars" will be filed with the Irish Stock Exchange for the purposes of such listing.
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The
Issuers are not and will not be regulated by the Central Bank of Ireland as a result of issuing the Notes. Any investment in the Notes does not have the status of a bank deposit and
is not within the scope of the deposit protection scheme operated by the Central Bank of Ireland.
No
action may be taken with respect to the Notes in Ireland otherwise than in conformity with the provisions of (1) the European Communities (Markets in Financial Instruments)
Regulations 2007 (Nos. 1 to 3), including, without limitation, Regulations 7 and 152 thereof or any codes of conduct used in connection therewith and the provisions of the
Investor Compensation Act 1998, (2) the Companies Acts 1963 to 2013 or, as applicable the Companies Act 2014, the Central Bank Acts 1942 to 2014 and any code of conduct rules made under
Section 117(1) of the Central Bank Act 1989, (3) the Prospectus (Directive 2003/71/EC) Regulations 2005 and any rules issued under Section 51 of the Investment Funds,
Companies and Miscellaneous Provisions Act 2005, by the Central Bank of Ireland and (4) the Market Abuse (Directive 2003/6/EC) Regulations 2005 and any rules issued under
Section 34 of the Investment Funds, Companies and Miscellaneous Provisions Act 2005, by the Central Bank of Ireland.
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DUTCH LAW CONSIDERATIONS
Insolvency Under Dutch Law
The Parent Guarantor, a public limited liability company (naamloze vennootschap
or N.V.), and AerCap Aviation Solutions B.V., a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid
or B.V.), are both incorporated under the laws of the Netherlands. Insolvency proceedings applicable to the Parent Guarantor or AerCap Aviation Solutions B.V. would likely be governed by
Dutch insolvency laws. There are two insolvency regimes under Dutch law in relation to corporations. The first, suspension of payments (surseance van
betaling), is intended to facilitate the reorganization of a debtor's debts and enable the debtor to continue as a going concern. The second, bankruptcy
(faillissement), is primarily designed to liquidate the assets of a debtor and distribute the
proceeds thereof to its creditors. In practice a suspension of payments nearly always results in the bankruptcy of the debtor.
A
request for a suspension of payments can only be filed by the debtor itself if it foresees that it will not be able to continue to pay its debts as they fall due in the future. Upon
commencement of suspension of payments proceedings, the court will immediately (dadelijk) grant a provisional suspension of payments, and will appoint
an administrator (bewindvoerder). A definitive suspension will generally be granted in a creditors' meeting called for that purpose, unless a qualified
minority (more than one-quarter in amount of claims held by creditors represented at the creditors' meeting or one-third in number of creditors represented at such creditors' meeting) of the unsecured
non-preferential creditors withholds its consent or if there is no prospect that the debtor will in the future be able to pay its debts as they fall due (in which case the debtor will generally be
declared bankrupt). During a suspension of payments, unsecured and non-preferential creditors will be precluded from attempting to recover their claims existing at the moment of the commencement of
the suspension of payments from the assets of the debtor. Secured creditors and (subject to certain limitations) preferential creditors (such as tax and social security authorities and employees) are
excluded from the application of the suspension. This implies that during suspension of payments proceedings secured creditors are not barred from taking recourse against the assets that secure their
claims to satisfy their claims, and preferential creditors are also not barred from seeking to recover their claims. Therefore, during a suspension of payments, certain assets of the debtor may be
sold in a manner that does not reflect their going concern value. Consequently, Dutch insolvency laws could preclude or inhibit a restructuring of the Parent Guarantor. A competent Dutch court may
order a "cooling down period" for a period of two months with a possible extension of two more months, during which enforcement actions by secured creditors and preferential creditors are barred,
unless such creditors have obtained leave for enforcement from the court or the supervisory judge (rechter-commissaris).
In
a suspension of payments, a composition (akkoord) may be offered by the debtor to its creditors. Such a composition will be binding on
all unsecured and non-preferential creditors, irrespective whether they voted in favor or against it or whether they were represented at the creditor's meeting called for the purpose of voting on the
composition plan, if (i) it is approved by a simple majority of the recognized and admitted creditors present or represented at the relevant meeting, representing at least 50% of the amount of
the recognized and admitted claims and (ii) it is subsequently ratified (gehomologeerd) by the court. Consequently, Dutch insolvency laws could
reduce the recovery of holders of the Notes in a Dutch suspension of payments applicable to the Parent Guarantor or AerCap Aviation Solutions B.V.
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Bankruptcy
can be applied for either by the debtor itself or by a creditor if the debtor has ceased to pay its debts as they fall due. This is deemed to be the case if the debtor has at
least two creditors (at least one of which has a claim that is due and payable). Simultaneously with the opening of the bankruptcy, a liquidator in bankruptcy
(curator) will be appointed. Under Dutch bankruptcy proceedings, the assets of an insolvent debtor are generally liquidated and the proceeds distributed
to the debtor's creditors in accordance with the ranking and priority of their respective claims. The general principle of Dutch bankruptcy law is the so-called paritas
creditorum (principle of equal treatment) which means that the proceeds of the liquidation of the debtor's assets in bankruptcy proceedings shall be distributed to the
unsecured and non-preferential creditors in proportion to the size of their claims. Certain creditors (such as secured creditors and preferential creditors) have special rights that may adversely
affect the interests of holders of the Notes. For example, a Dutch bankruptcy in principle does not prohibit secured creditors from taking recourse against the encumbered assets of the bankrupt debtor
to satisfy their claims. Furthermore, secured creditors in principle do not have to contribute to the liquidation costs.
Consequently,
Dutch insolvency laws could reduce the potential recovery of a holder of the Notes in Dutch bankruptcy proceedings. As a general rule, to obtain payment on unsecured
non-preferential claims, such claims need to be submitted to the liquidator in bankruptcy in order to be recognized. The liquidator in bankruptcy determines whether a claim can be provisionally
recognized for the purpose of the distribution of the proceeds, and at what value. The valuation of claims that do not by their terms become payable at the time of the commencement of the bankruptcy
proceedings may be based on their net present value. Interest payments that fall due after the date of the bankruptcy will not be recognized. At a creditors' meeting
(verificatievergadering) the liquidator in bankruptcy, the insolvent debtor and all relevant creditors may dispute the provisional recognition of claims
of other creditors. Creditors whose claims or part thereof are disputed in the creditors' meeting will be referred to separate court proceedings
(renvooiprocedure). This procedure could result in holders of the Notes receiving a right to recover less than the principal amount of their notes. In
addition, in a Dutch bankruptcy in practice usually no or little funds remain available for the payment of unsecured and non-preferential creditors.
As
in suspension of payments proceedings, in a bankruptcy, a composition (akkoord) may be offered to the unsecured and non-preferential
creditors. Such a composition will be binding upon all unsecured and non-preferential creditors, if (i) it is approved by a simple majority of unsecured non-preferential creditors with
recognized and provisionally admitted claims representing at least 50% of the total amount of the recognized and provisionally admitted unsecured non preferential claims and (ii) it is
subsequently ratified (gehomologeerd) by the court.
Secured
creditors may, in a Dutch bankruptcy, enforce their rights against the assets of the debtor which are subject to their security rights, to satisfy their claims as if there were
no bankruptcy. As in suspension of payments proceedings, the competent Dutch court or the supervisory judge may order a "cooling down period" for a maximum of two times two months during which
enforcement actions by those creditors are barred unless they have obtained leave for enforcement from the supervisory judge. Furthermore, a liquidator in bankruptcy can force a secured creditor to
foreclose its security right within a reasonable time (as determined by the liquidator in bankruptcy pursuant to Section 58(1) of the Dutch Bankruptcy Act), failing which the liquidator in
bankruptcy will be entitled to sell the relevant rights or assets and distribute the net proceeds (after deduction of a pro rata part of the costs
of the bankruptcy proceedings) to the secured party and excess proceeds of enforcement must be returned to the liquidator in bankruptcy. Such excess proceeds may not be offset
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against
an unsecured claim of the secured creditor against the debtor. Under Dutch law, as soon as a debtor is declared bankrupt, all pending enforcements of judgments against such debtor terminate by
operation of law and all attachments on the debtor's assets lapse by operation of law. Litigation against a debtor which is pending on the date on which that debtor is declared bankrupt and which
concerns a claim against that debtor which must be satisfied from the proceeds of the liquidation in bankruptcy, is automatically stayed.
Enforcement of Civil Liability Judgments Under Dutch Law
We are advised that there is no enforcement treaty between the Netherlands and the United States providing for reciprocal recognition
and enforcement of judgments, other than arbitration awards, in civil and commercial matters. Therefore, a judgment rendered by any federal or state court in the United States in such matters cannot
automatically be enforced in the Netherlands. An application will have to be made to the competent Dutch Court in order to obtain a judgment that can be enforced in the Netherlands. The Dutch courts
can in principle be expected to give conclusive effect to a final and enforceable judgment of a competent United States court in respect of the contractual obligations under the relevant document
without re-examination or re-litigation, but would require (i) that the relevant court in the United States had jurisdiction in the matter in accordance with standards that are generally
accepted internationally, (ii) the proceedings before such court to have complied with principles of proper procedure (behoorlijke
rechtspleging), (iii) such judgment not being contrary to the public policy of the Netherlands or the European Union, and (iv) that recognition and/or enforcement
of the judgment is not irreconcilable with a decision of a Dutch court rendered between the same parties or with an earlier decision of a foreign court rendered between the same parties in a dispute
that is about the same subject matter and that is based on the same cause, provided that such earlier decision can be recognized in the Netherlands, but the court will in either case have discretion
to attach such weight to the judgment of any federal or state court in the United States as it deems appropriate and may re-examine or re-litigate the substantive matters adjudicated upon.
Furthermore, a Dutch court may reduce the amount of damages granted by a federal or state court in the United States and recognize damages only to the extent that they are necessary to compensate
actual losses or damages.
Dutch
civil procedure differs substantially from U.S. civil procedure in a number of respects. Insofar as the production of evidence is concerned, U.S. law and the laws of several other
jurisdictions based on common law provide for pre-trial discovery, a process by which parties to the proceedings may prior to trial compel the production of documents by adverse or third parties and
the deposition of witnesses. Evidence obtained in this manner may be decisive in the outcome of any proceeding. No such pre-trial discovery process exists under Dutch law. In addition, it is doubtful
whether a Dutch court would accept jurisdiction and impose civil or other liability in an original action commenced in the Netherlands and predicated solely upon United States federal securities laws.
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CERTAIN ERISA CONSIDERATIONS
General
The U.S. Employee Retirement Income Security Act of 1974, as amended ("ERISA"), imposes certain requirements on employee benefit plans
subject to Title I of ERISA and on entities that are deemed to hold the assets of such plans ("ERISA Plans"), and on those persons who are fiduciaries with respect to ERISA Plans. Investments by ERISA
Plans are subject to ERISA's general fiduciary requirements, including, but not limited to, the requirement of investment prudence and diversification and the requirement that an ERISA Plan's
investments be made in accordance with the documents governing the plan.
Section 406
of ERISA and Section 4975 of the Code, prohibit certain transactions involving the assets of an ERISA Plan or of a plan, such as an individual retirement
account, that is not subject to ERISA but is subject to Section 4975 of the Code (together with ERISA Plans, "Plans"). Such a transaction could be prohibited if the transaction involves certain
parties related to the Plan (referred to as "parties in interest" or "disqualified persons") or if the Plan fiduciary causing the use of plan assets in the transaction has a prohibited conflict of
interest related to the transaction. A party in interest or disqualified person that engages in a non-exempt prohibited transaction may be subject to excise taxes and other penalties and
liabilities under ERISA and the Code, and a fiduciary that causes a non-exempt prohibited transaction may be subject to penalties and liabilities under ERISA and the Code.
Any
Plan fiduciary that proposes to cause a Plan to purchase the Notes should consult with its counsel regarding the applicability of the fiduciary responsibility and prohibited
transaction provisions of ERISA and Section 4975 of the Code to such an investment and to confirm that such purchase and holding will not constitute or result in a non-exempt prohibited
transaction or any other violation of an applicable requirement of ERISA or Section 4975 of the Code.
Non-U.S.
plans, governmental plans and certain church plans, while not subject to the fiduciary responsibility provisions of ERISA or the prohibited transaction provisions of ERISA and
Section 4975 of the Code, may nevertheless be subject to non-U.S., state, local or other federal laws or regulations that are substantially similar to the foregoing provisions of ERISA or
Section 4975 of the Code ("Similar Law"). Fiduciaries of any such plans should consult with their counsel before purchasing the Notes to determine the need for and the availability of, if
necessary, any exemptive relief under any Similar Law.
Prohibited Transaction Exemptions
Any Plan fiduciary that proposes to purchase and hold any notes with the assets of such Plan should consider, among other things,
whether such purchase and holding may constitute or result in a direct or indirect prohibited transaction with a party in interest or disqualified person with respect to such Plan and, if so, whether
exemptive relief may be available for the transaction. Such parties in interest or disqualified persons could include, without limitation, the Issuers, the underwriters, the guarantors or any of their
respective affiliates.
The
U.S. Department of Labor has issued prohibited transaction class exemptions ("PTCEs") that may provide exemptive relief for direct or indirect prohibited transactions resulting from
the purchase or holding of the Notes. These exemptions include, without limitation, PTCE 84-14 (relating to transactions effected by an independent "qualified professional asset manager"),
PTCE 90-1 (relating to investments by insurance company pooled separate accounts), PTCE 91-38 (relating to investments by bank collective investment funds), PTCE 95-60 (relating
to investments by insurance company general accounts) or
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PTCE 96-23
(relating to transactions directed by an in-house asset manager). In addition, Section 408(b)(17) of ERISA and Section 4975(d)(20) of the Code provide a statutory
exemption for certain transactions involving certain non-fiduciary service providers or their affiliates. One of these exemptions could provide an exemption for the purchase and holding of the Notes
from the prohibited transaction provisions of ERISA and Section 4975 of the Code if its conditions are satisfied. However, there can be no assurance that all of the conditions of any of these
exemptions or of any other exemption will be available with respect to any particular transaction involving the Notes.
Representation
By acceptance of a Note, each holder and subsequent transferee will be deemed to have represented and warranted that either
(i) no portion of the assets used by such holder or transferee to acquire or hold the Notes constitutes assets of any Plan or other plan subject to Similar Law or (ii) the acquisition
and holding of the Notes by such purchaser or transferee will not constitute or result in a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or a
similar violation under any applicable Similar Law.
The
foregoing discussion is general in nature and is not intended to be all-inclusive. Due to the complexity of these rules and the penalties that may be imposed upon persons involved in
non-exempt prohibited transactions, it is particularly important that fiduciaries or other persons considering acquiring the Notes on behalf of, or with the assets of, any Plan, consult with their
counsel regarding the potential applicability of ERISA, Section 4975 of the Code and any Similar Laws to such investments and whether an exemption would be applicable to the purchase and
holding of the Notes.
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UNDERWRITING
We are offering the Notes described in this prospectus supplement through the underwriters named below. Deutsche Bank
Securities Inc. is acting as the representative of the underwriters. Subject to the terms and conditions of the underwriting agreement, we have agreed to sell to the underwriters, and each
underwriter has severally agreed to purchase, the aggregate principal amount of Notes listed next to its name in the following table at the public offering price less the underwriting discount set
forth on the cover page of this prospectus supplement:
|
|
|
|
|
|
|
|
Underwriter
|
|
Principal Amount
of the 2020 Notes |
|
Principal Amount
of the 2022 Notes |
|
Credit Suisse Securities (USA) LLC |
|
$ |
112,500,000.00 |
|
$ |
112,500,000.00 |
|
Deutsche Bank Securities Inc. |
|
|
125,000,000.00 |
|
|
125,000,000.00 |
|
Goldman, Sachs & Co. |
|
|
112,500,000.00 |
|
|
112,500,000.00 |
|
Barclays Capital Inc. |
|
|
14,250,000.00 |
|
|
14,250,000.00 |
|
Citigroup Global Markets Inc. |
|
|
6,000,000.00 |
|
|
6,000,000.00 |
|
Credit Agricole Corporate and Investment Bank |
|
|
35,000,000.00 |
|
|
35,000,000.00 |
|
J.P. Morgan Securities LLC |
|
|
5,000,000.00 |
|
|
5,000,000.00 |
|
Merrill Lynch, Pierce, Fenner & Smith
Incorporated |
|
|
35,000,000.00 |
|
|
35,000,000.00 |
|
Mizuho Securities USA Inc. |
|
|
10,000,000.00 |
|
|
10,000,000.00 |
|
Morgan Stanley & Co. LLC |
|
|
5,000,000.00 |
|
|
5,000,000.00 |
|
RBC Capital Markets, LLC |
|
|
5,000,000.00 |
|
|
5,000,000.00 |
|
UBS Securities LLC |
|
|
6,000,000.00 |
|
|
6,000,000.00 |
|
Wells Fargo Securities, LLC |
|
|
10,000,000.00 |
|
|
10,000,000.00 |
|
BNP Paribas Securities Corp. |
|
|
5,000,000.00 |
|
|
5,000,000.00 |
|
Fifth Third Securities, Inc. |
|
|
4,583,333.34 |
|
|
4,583,333.34 |
|
HSBC Securities (USA) Inc. |
|
|
4,583,333.33 |
|
|
4,583,333.33 |
|
SunTrust Robinson Humphrey, Inc. |
|
|
4,583,333.33 |
|
|
4,583,333.33 |
|
Total |
|
$ |
500,000,000.00 |
|
$ |
500,000,000.00 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
underwriting agreement is subject to a number of terms and conditions and provides that the underwriters must buy all of the Notes if they buy any of them. The underwriters will sell
the Notes to the public when and if the underwriters buy the Notes from us. The offering of the Notes by the underwriters is subject to receipt and acceptance and subject to the underwriters' right to
reject any order in whole or part.
The
underwriters have advised us that they propose initially to offer the Notes to the public for cash at the public offering prices set forth on the cover of this prospectus supplement,
and may offer the Notes to certain dealers at such prices less a concession not in excess of 0.50% of the principal amount of the Notes. The underwriters may allow, and such dealers may reallow, a
concession not in excess of 0.25% of the principal amount of the Notes to certain other dealers. After the initial public offering of the Notes, the public offering prices and other selling terms may
be changed.
We
estimate that our share of the total expenses of the offering, excluding underwriting discounts, will be approximately $400,000.
We
have agreed to indemnify the underwriters, severally, against, or contribute to payments that the underwriters may be required to make in respect of, certain liabilities, including
liabilities under the Securities Act of 1933, as amended.
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We
have agreed that we and the guarantors will not, for a period of 30 days following the date of this Prospectus Supplement, without the prior written consent of Deutsche Bank
Securities Inc., offer, sell, contract to sell, pledge, otherwise dispose of, or enter into any transaction which is designed to, or might reasonably be expected to, result in the disposition
(whether by actual disposition or effective economic disposition due to cash settlement or otherwise) by us, any guarantor, or any controlled Affiliate of us or a guarantor, directly or indirectly, or
announce the offering, of any debt securities issued or guaranteed by us or any guarantor (other than the Notes to be issued on the issue date).
The
Notes are new issues of securities with no established trading market. Other than the Global Exchange Market of the Irish Stock Exchange, the Notes will not be listed on any
securities exchange or on any automated dealer quotation system. The underwriters may make a market in the Notes after completion of the offering, but will not be obligated to do so and may
discontinue any market-making activities at any time without notice. No assurance can be given as to the liquidity of the trading market for the Notes or that an active public market for the Notes
will develop. If an active public market for the Notes does not develop, the market price and liquidity of the Notes may be adversely affected.
In
connection with the offering of the Notes, the underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of the Notes. Specifically, the
underwriters
may overallot in connection with the offering, creating a short position. In addition, the underwriters may bid for, and purchase, the Notes in the open market to cover short positions or to stabilize
the price of the Notes. Any of these activities may stabilize or maintain the market price of the Notes above independent market levels, but no representation is made hereby of the magnitude of any
effect that the transactions described above may have on the market price of the Notes. The underwriters will not be required to engage in these activities, and may engage in these activities, and may
end any of these activities, at any time without notice.
The
underwriters also may impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the
underwriters have repurchased notes sold by or for the account of such underwriter in stabilizing or short covering transactions.
Neither
we nor the underwriters make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of the
Notes. In addition, neither we nor the underwriters make any representation that the underwriters will engage in these transactions or that these transactions, once commenced, will not be discontinued
without notice.
The
underwriters and certain of their affiliates are full service financial institutions and have provided from time to time, and may provide in the future, various services including
sales and trading, investment and commercial banking, advisory, investment management, investment research, principal investment, hedging, market making, brokerage and other financial and
non-financial services to us and our affiliates in the ordinary course of business, for which they have received and may continue to receive customary fees and commissions. The underwriters or their
affiliates are acting, and will continue to act, as arrangers, agents or lenders under our various credit facilities and other debt agreements. In addition, Goldman, Sachs & Co. acted as
sole financial advisor to AerCap's board of directors in connection with the acquisition of ILFC, a wholly-owned subsidiary of American International Group, Inc.
If
any of the underwriters or their affiliates has a lending relationship with us, we understand that (1) certain of those underwriters or their affiliates routinely hedge,
(2) certain of the underwriters are likely to hedge or otherwise reduce, and (3) certain other of those
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underwriters
or their affiliates may hedge, their credit exposure to us consistent with their customary risk management policies. These underwriters and their affiliates may hedge such exposure by
entering into transactions that consist of either the purchase of credit default
swaps or the creation of short positions in our securities, including potentially the Notes offered hereby. Any such credit default swaps or short positions may adversely affect future trading prices
of the Notes offered hereby.
In
addition, in the ordinary course of their various business activities, the underwriters and their respective affiliates may make or hold a broad array of investments and actively
trade debt and equity securities (or related derivative securities), commodities, currencies, credit default swaps and other financial instruments (including bank loans) for their own account and for
the accounts of their customers, and such investment and securities activities may involve securities and instruments of ours or our affiliates. The underwriters and their respective affiliates may
also make investment recommendations or publish or express independent research views in respect of such securities or financial instruments and may at any time hold, or recommend to clients that they
acquire, long or short positions in such securities and instruments.
Selling Restrictions
Notice to Prospective Investors in the European Economic Area
In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a "Relevant Member
State"), each underwriter has represented and agreed that with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the "Relevant
Implementation Date") it has not made and will not make an offer of notes to the public in that Relevant Member State prior to the publication of a prospectus in relation to the notes which has been
approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member
State, all in accordance with the Prospectus Directive, except that it may, with effect from and including the Relevant Implementation Date, make an offer of notes to the public in that Relevant
Member State at any time:
- (a)
- to
any legal entity which is a qualified investor as defined in the Prospectus Directive;
- (b)
- to
fewer than 100 or, if the Relevant Member State has implemented the relevant provision of the 2010 PD Amending Directive, 150, natural or legal persons
(other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive, subject to obtaining the prior consent of the representative for any such offer;
or
- (c)
- in
any other circumstances which do not require the publication by us of a prospectus pursuant to Article 3 of the Prospectus Directive;
For
the purposes of this provision, the expression an "offer of notes to the public" in relation to any notes in any Relevant Member State means the communication in any form and by any
means of sufficient information on the terms for the offer and the shares to be offered so as to enable an investor to decide to purchase or subscribe the Notes, as the same may be varied in that
Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member State, the expression Prospectus Directive means Directive 2003/71/EC (and amendments thereto,
including the PD 2010 Amending Directive to the extent implemented in the Relevant Member State) and includes any relevant
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implementing
measure in each Relevant Member State, and the expression 2010 PD Amending Directive means Directive 2010/73/EU.
Notice to Prospective Investors in the United Kingdom
This prospectus supplement and any other material in relation to the Notes described herein is only being distributed to, and is only
directed at, persons in the United Kingdom that are qualified investors within the meaning of Article 2(1)(e) of the Prospective Directive ("qualified investors") that also (i) have
professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended, or the
Order, (ii) who fall within Article 49(2)(a) to (d) of the Order or (iii) to whom it may otherwise lawfully be
communicated (all such persons together being referred to as "relevant persons"). The Notes are only available to, and any invitation, offer or agreement to purchase or otherwise acquire such notes
will be engaged in only with, relevant persons. This prospectus supplement and its contents are confidential and should not be distributed, published or reproduced (in whole or in part) or disclosed
by recipients to any other person in the United Kingdom. Any person in the United Kingdom that is not a relevant person should not act or rely on this prospectus or any of its contents.
Notice to Prospective Investors in the Netherlands
The ordinary shares may only be offered to legal entities which are qualified investors as defined in the Prospectus Directive.
Notice to Prospective Investors in Ireland
Each of the underwriters has agreed in respect of the notes that it will not offer or sell such notes or take any other action with
respect of the notes in Ireland otherwise than in conformity with the provisions of (a) the European Communities (Markets in Financial Instruments) Regulations 2007 (Nos. 1 to 3),
including, without limitation, Regulations 7 and 152 thereof or any codes of conduct used in connection therewith and the provisions of the Investor Compensation Act 1998, (b) the
Companies Acts 1963 to 2013 or, as applicable, the Companies Act 2014, the Central Bank Acts 1942 to 2014 and any code of conduct rules made under Section 117(1) of the Central Bank Act 1989,
(c) the Prospectus (Directive 2003/71/EC) Regulations 2005 and any rules issued under Section 51 of the Investment Funds, Companies and Miscellaneous Provisions Act 2005 or, as
applicable, Section 1363 of the Companies Act 2014 by the Central Bank of Ireland and (d) the Market Abuse (Directive 2003/6/EC) Regulations 2005 and any rules issued under
Section 34 of the Investment Funds, Companies and Miscellaneous Provisions Act 2005 or, as applicable, Section 1370 of the Companies Act 2014 by the Central Bank of Ireland.
Notice to Prospective Investors in Hong Kong
The Notes may not be offered or sold in Hong Kong by means of any document other than (i) in circumstances which do not
constitute an offer to the public within the meaning of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32 of the Laws of Hong Kong) ("Companies (Winding Up and Miscellaneous
Provisions) Ordinance") or which do not constitute an invitation to the public within the meaning of the Securities and Futures Ordinance Ordinance (Cap. 571 of the Laws of Hong Kong) ("Securities and
Futures Ordinance"), or (ii) to "professional investors" as defined in the Securities and Futures Ordinance and any rules made thereunder, or (iii) in other circumstances which do not
result in the document being a "prospectus" as defined in the Companies (Winding Up and
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Miscellaneous
Provisions) Ordinance, and no advertisement, invitation or document relating to the Notes may be issued or may be in the possession of any person for the purpose of issue (in each case
whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the securities laws
of Hong Kong) other than with respect to notes which are or are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" in Hong Kong as defined in the
Securities and Futures Ordinance and any rules made thereunder.
Notice to Prospective Investors in Singapore
This prospectus supplement has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this
prospectus supplement and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the Notes may not be circulated or distributed, nor may
the Notes be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional
investor (as defined in Section 4A of the Securities and Futures Act, Chapter 289 of Singapore (the "SFA")) under Section 274 of the SFA, (ii) to a relevant person (as
defined in Section 275(2) of the SFA) pursuant to Section 275(1) of the SFA, or any person pursuant to Section 275(1A) of the SFA, and in accordance with the conditions specified
in Section 275 of
the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA, in each case subject to conditions set forth in the SFA.
Where
the Notes are subscribed or purchased under Section 275 of the SFA by a relevant person which is a corporation (which is not an accredited investor (as defined in
Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor, the
securities (as defined in Section 239(1) of the SFA) of that corporation shall not be transferable for 6 months after that corporation has acquired the Notes under Section 275 of
the SFA except: (1) to an institutional investor under Section 274 of the SFA or to a relevant person (as defined in Section 275(2) of the SFA), (2) where such transfer
arises from an offer in that corporation's securities pursuant to Section 275(1A) of the SFA, (3) where no consideration is or will be given for the transfer, (4) where the
transfer is by operation of law, (5) as specified in Section 276(7) of the SFA, or (6) as specified in Regulation 32 of the Securities and Futures (Offers of Investments)
(Shares and Debentures) Regulations 2005 of Singapore ("Regulation 32").
Notice to Prospective Investors in Japan
The Notes have not been and will not be registered under the Financial Instruments and Exchange Act of Japan (Act No. 25 of
1948, as amended), or the FIEA. The Notes may not be offered or sold, directly or indirectly, in Japan or to or for the benefit of any resident of Japan (including any person resident in Japan or any
corporation or other entity organized under the laws of Japan) or to others for reoffering or resale, directly or indirectly, in Japan or to or for the benefit of any resident of Japan, except
pursuant to an exemption from the registration requirements of the FIEA and otherwise in compliance with any relevant laws and regulations of Japan.
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LEGAL MATTERS
Certain legal matters in connection with the offering of the Notes will be passed upon for us by Cravath, Swaine &
Moore LLP, New York, New York (with respect to New York and United States federal law), McCann FitzGerald, Dublin, Ireland (with respect to Irish law), NautaDutilh N.V., Rotterdam, the
Netherlands (with respect to Dutch law), Morris, Nichols, Arsht & Tunnell LLP (with respect to Delaware law) and Buchalter Nemer, a Professional Corporation, Los Angeles, California
(with respect to California law). The underwriters have been represented by Paul Hastings LLP, New York, New York.
EXPERTS
The consolidated financial statements and management's assessment of the effectiveness of internal control over financial reporting
(which is included in Management's Report on Internal Control over Financial Reporting) incorporated in this prospectus supplement by reference to AerCap Holdings N.V.'s Report on
Form 6-K dated April 23, 2015 have been so incorporated in reliance on the report of PricewaterhouseCoopers Accountants N.V., an independent registered public accounting firm,
given on the authority of said firm as experts in auditing and accounting.
The
financial statements of International Lease Finance Corporation incorporated in this prospectus supplement by reference to AerCap Holdings N.V.'s Report on Form 6-K
dated May 14, 2014 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm given on the authority of said firm
as experts in auditing and accounting.
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PROSPECTUS
AerCap Ireland Capital Limited
AerCap Global Aviation Trust
Debt securities (guaranteed to the extent provided herein)
AerCap Ireland Capital Limited (the "Irish Issuer") and AerCap Global Aviation Trust (the "U.S. Issuer" and, together with the Irish Issuer, the
"Issuers"), each a wholly owned subsidiary of AerCap Holdings N.V., may offer and sell from time to time debt securities as separate series in amounts, at prices and on terms to be determined
at the time of sale. The debt securities may consist of debentures, notes or other types of debt. For each offering, a prospectus supplement will accompany this prospectus and will contain the
specific terms of the series of debt securities for which this prospectus is being delivered.
The
Issuers may sell debt securities to or through one or more underwriters or dealers, and also may sell debt securities directly to other purchasers or through agents. The accompanying
prospectus supplement will set forth information regarding the underwriters or agents involved in the sale of the debt securities for which this prospectus is being delivered. See "Plan of
Distribution" for possible indemnification arrangements for underwriters, agents and their controlling persons.
This
prospectus may not be used for sales of securities unless it is accompanied by a prospectus supplement.
Investing in the debt securities to be offered by this prospectus and any applicable prospectus supplement involves risk. You should
carefully review the risks and uncertainties described under the heading "Risk Factors" on page 3 of this prospectus before you make an investment in our debt
securities.
Neither the Securities and Exchange Commission (the "SEC") nor any other state securities commission has approved or disapproved of these
securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.
The
date of this prospectus is June 22, 2015.
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Rather
than repeat certain information in this prospectus that we have already included in reports filed with the SEC, we are incorporating this information by reference, which means
that we can disclose important business, financial and other information to you by referring to those publicly filed documents that contain the information. The information incorporated by reference
is not included or delivered with this prospectus.
We
will provide without charge to each person to whom a prospectus is delivered, upon written or oral request of such person, a copy of any or all documents that are incorporated into
this prospectus by reference, other than exhibits to such documents, unless such exhibits are specifically incorporated by reference into the documents that this prospectus incorporates. Requests
should be directed to AerCap Holdings N.V., AerCap House, Stationsplein 965, 1117 CE Schipol, The Netherlands, or by telephoning us at +31 20 655 9655.
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ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we have filed with the SEC on Form F-3, utilizing a "shelf"
registration process, relating to the debt securities and guarantees described in this prospectus. Under this shelf registration process, the Issuers may, from time to time, sell the debt securities
described in this prospectus and any applicable prospectus supplement in one or more offerings. Each time the Issuers sell debt securities, they will provide a prospectus supplement that will contain
specific information about the terms of that specific offering, including the offering price of the debt securities. The prospectus supplement may also add, update or change information contained in
this prospectus. You should carefully read both this prospectus and the applicable prospectus supplement relating to any specific offering of debt securities, together with additional information
described below under the headings "Where You Can Find More Information" and "Incorporation of Certain Documents by Reference," before you decide to invest in any of the debt securities.
This
prospectus and any accompanying prospectus supplements do not contain all of the information included in the registration statement. We have omitted parts of the registration
statement in accordance with the rules and regulations of the SEC. For further information, we refer you to the registration statement on Form F-3, including its exhibits, of which this
prospectus is a part. Statements
contained in this prospectus and any accompanying prospectus supplements about the provisions or contents of any agreement or other document are not necessarily complete. If the SEC rules and
regulations require that an agreement or document be filed as an exhibit to the registration statement, please see that agreement or document for a complete description of these matters. You should
not assume that the information in this prospectus, any prospectus supplements or in any documents incorporated herein or therein by reference is accurate as of any date other than the date on the
front of each of such documents.
Unless
indicated otherwise or the context otherwise requires, references in this prospectus to the terms "our," "us," "we," "AerCap" or the "Company" include AerCap Holdings N.V.
and its subsidiaries as a combined entity.
Currency
amounts in this prospectus are stated in United States dollars, unless indicated otherwise.
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COMPANY INFORMATION
AerCap is the world's largest independent aircraft leasing company. AerCap focuses on acquiring in-demand aircraft at attractive
prices, funding them efficiently, hedging interest rate risk conservatively and using its platform to deploy those assets with the objective of delivering superior risk adjusted returns. AerCap is a
New York Stock Exchange-listed company (AER), and has its headquarters in Amsterdam with offices in Los Angeles, Shannon, Dublin, Fort Lauderdale, Miami, Singapore, Shanghai, Abu Dhabi and
representation offices at the world's largest aircraft manufacturers, Boeing and Airbus, in Seattle and Toulouse.
AerCap Holdings N.V.
AerCap Holdings N.V., the Parent Guarantor, was incorporated in the Netherlands with registered number 34251954 on
July 10, 2006 as a public limited company under the
Netherlands Civil Code. The Parent Guarantor's principal executive offices are located at AerCap House, Stationsplein 965, 1117 CE Schiphol, the Netherlands, its general telephone number
is +31 20 655-9655, and its website address is www.aercap.com. Puglisi & Associates is the Parent Guarantor's authorized representative in the United States. The address of
Puglisi & Associates is 850 Liberty Avenue, Suite 204, Newark, DE 19711 and their general telephone number is +1 (302) 738-6680.
AerCap Ireland Capital Limited
AerCap Ireland Capital Limited, the Irish Issuer, was incorporated in Ireland with registered number 535682 on
November 22, 2013 as a private limited company under the Companies Acts 1963 to 2013. The registered office of the Irish Issuer is at 4450 Atlantic Avenue, Westpark, Shannon, Co. Clare,
Ireland (telephone number +353 61 723600).
AerCap Global Aviation Trust
AerCap Global Aviation Trust, the U.S. Issuer, is a statutory trust formed on February 5, 2014 with registration
number 5477349 under the Delaware Statutory Trust Act, 12 Del. C.§§ 3801 et.seq. (the "Delaware Act"), pursuant to a trust agreement between the Irish Issuer and
Wilmington Trust, National Association, as the Delaware Trustee. The principal office of the U.S. Issuer is at 4450 Atlantic Avenue, Westpark, Shannon, Co. Clare, Ireland (telephone
number +353 61 723600).
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RISK FACTORS
Investing in the securities to be offered by this prospectus and any applicable prospectus supplement involves risk. Before you make a
decision to buy such securities, you should read and carefully consider the risks and uncertainties discussed in the section captioned "Risk Factors" in Item 3 of our Annual Report on
Form 20-F for the year ended December 31, 2014, filed with the SEC on March 30, 2015 and in Part II, Item 1 of our interim financial reports contained in our Current
Reports on Form 6-K subsequently filed under the Exchange Act and incorporated by reference herein, as well as any risks described in any applicable prospectus supplement and any related free
writing prospectus or in other documents that are incorporated by reference therein. Additional risks not currently known to us or that we currently deem immaterial may also have a material adverse
effect on us. You should carefully consider the aforementioned risks together with the other information in this prospectus and incorporated by reference herein before deciding to invest in the debt
securities. If any of those risks actually occur, our business, financial condition and results of operations could be materially and adversely affected. In that case, we may be unable to make
required payments of principal, premiums, if any, and interest on the debt securities.
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FORWARD LOOKING STATEMENTS
This prospectus and the documents incorporated by reference herein may contain "forward looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. We have based these forward looking statements on our current beliefs and projections about future events and financial trends affecting our business.
Many important factors, in addition to those discussed in this prospectus, could cause our actual results to differ substantially from those anticipated in our forward looking statements, including,
among other things:
-
- the availability of capital to us and to our customers and changes in interest rates,
-
- the ability of our lessees and potential lessees to make operating lease payments to us,
-
- our ability to successfully negotiate aircraft purchases, sales and leases, to collect outstanding amounts due and to repossess
aircraft under defaulted leases, and to control costs and expenses,
-
- decreases in the overall demand for commercial aircraft leasing and aircraft management services,
-
- the economic condition of the global airline and cargo industry and the general economic and political conditions,
-
- competitive pressures within our industry,
-
- the negotiation of aircraft management services contracts,
-
- our ability to achieve the anticipated benefits of the acquisition of International Lease Finance Corporation from AIG,
-
- regulatory changes affecting commercial aircraft operators, aircraft maintenance, engine standards, accounting standards and taxes,
-
- the risks described or referred to in "Risk Factors" in this prospectus or any
prospectus supplement and in our Annual Report on Form 20-F for the year ended December 31, 2014.
The
words "believe", "may", "aim", "estimate", "continue", "anticipate", "intend", "expect" and similar words are intended to identify forward looking statements. Forward looking
statements include information concerning our possible or assumed future results of operations, business strategies, financing plans, competitive position, industry environment, potential growth
opportunities, the effects of future regulation and the effects of competition. Forward looking statements speak only as of the date they were made and we undertake no obligation to update publicly or
to revise any forward looking statements because of new information, future events or other factors. In light of the risks and uncertainties described above, the forward looking events and
circumstances described in this prospectus might not occur and are not guarantees of future performance. The factors described above should not be construed as exhaustive and should be read in
conjunction with the other cautionary statements and the risk factors that are included under "Risk Factors" herein, any prospectus
supplement or in our Annual Report on Form 20-F for the year ended December 31, 2014 incorporated by reference herein. Except as required by applicable law, we do not undertake any
obligation to publicly update or review any forward looking statement, whether as a result of new information, future developments or otherwise.
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WHERE YOU CAN FIND MORE INFORMATION
We have filed a registration statement on Form F-3, including the exhibits and schedules thereto, with the SEC under the
Securities Act, and the rules and regulations thereunder, for the registration of the debt securities that are being offered by this prospectus. This prospectus does not include all of the information
contained in the registration statement. You should refer to the registration statement and its exhibits for additional information. Whenever we make reference in this prospectus to any of our
contracts, agreements or other documents that we filed as exhibits to the registration statement, the references are not necessarily complete and you should refer to the exhibits attached to the
registration statement for copies of the actual contract, agreements or other documents.
We
are subject to the information reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as applicable to foreign private issuers. As a "foreign
private issuer," we are exempt from the rules under the Exchange Act prescribing certain disclosure and procedural requirements for proxy solicitations. We file with the SEC an Annual Report on
Form 20-F containing financial statements audited by an independent registered public accounting firm. We also file Reports on Form 6-K containing unaudited interim financial information
for the first three quarters of each fiscal year.
You
may read and copy any document we file with or furnish to the SEC at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may also obtain copies
of the documents at prescribed rates by writing to the Public Reference Section of the SEC at 100 F Street, N.E., Washington, DC 20549. Please call the SEC at 1-800-SEC-0330 to obtain
information on the operation of the Public Reference Room. In addition, the SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding
issuers that file electronically with the SEC. You can review our SEC filings, including the registration statement, by accessing the SEC's Internet website at www.sec.gov. We will provide each
person, to whom a prospectus is delivered a copy of any or all of the information that has been incorporated by reference into this prospectus but not delivered with this prospectus upon written or
oral request at no cost to
the requester. Requests should be directed to: AerCap Holdings N.V., Stationsplein 965, 1117 CE Schiphol Airport, The Netherlands, Attention: Compliance Officer, or by telephoning
us at +31 20 655 9655. Our website is located at www.aercap.com. The reference to the website is an inactive textual reference only and the information contained on our website is
not a part of this prospectus.
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INCORPORATION BY REFERENCE
The following documents filed with or furnished to the SEC are incorporated herein by
reference:
-
- AerCap's Annual Report on Form 20-F for the year ended December 31, 2014, as filed with the SEC on March 30,
2015, together with the Form 6-K filed with the SEC on April 23, 2015; and
-
- AerCap's Reports on Form 6-K, furnished to the SEC on May 14, 2014, January 5, 2015, January 16, 2015,
March 30, 2015, April 2, 2015, April 23, 2015, May 7, 2015, May 18, 2015. May 20, 2015, June 2, 2015, June 2, 2015, June 5, 2015,
June 9, 2015, June 12, 2015 and June 16, 2015.
The
financial statements of International Lease Finance Corporation are incorporated in this prospectus by reference to our Report on Form 6-K dated May 14, 2014, and have
been so incorporated to satisfy the requirements of Rules 3-05 and 3-10(g) of Regulation S-X.
All
documents subsequently filed by us with the SEC pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act and, solely to the extent designated therein, reports made on
Form 6-K that we furnish to the SEC, prior to the filing of a post-effective amendment to the registration statement that
contains this prospectus that indicates that all securities offered have been sold or that deregisters all securities then remaining unsold, shall be incorporated by reference in this prospectus and
to be a part hereof from the date of filing or furnishing of such documents. Any statement contained herein or in a document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained herein or in any subsequently filed document that also is or is deemed to be incorporated
by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
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USE OF PROCEEDS
Unless the prospectus supplement states otherwise, we intend to use the proceeds from the sale of the securities to acquire, invest in,
finance or refinance aircraft assets, to repay indebtedness and for other general corporate purposes.
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RATIO OF EARNINGS TO FIXED CHARGES
For purposes of calculating the ratio of earnings to fixed charges, earnings consist of income from continuing operations before income
taxes, income of investments accounted for under the equity method and non-controlling interests plus amortization of capitalized interest and fixed charges (excluding capitalized interest). Fixed
charges consist of interest incurred (whether expensed or capitalized), amortization of debt expense and that portion of rental expense on operating leases deemed to be the equivalent of interest. The
following table sets forth AerCap's ratio of earnings to fixed charges for each of the periods indicated.
AerCap Holdings N.V. and Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
|
|
|
|
Three Months Ended
March 31, 2015 |
|
|
|
2010 |
|
2011 |
|
2012 |
|
2013 |
|
2014 |
|
Ratio of earnings to fixed charges |
|
|
2.04 |
|
|
1.77 |
|
|
1.54 |
|
|
2.32 |
|
|
2.00 |
|
|
2.19 |
|
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DESCRIPTION OF DEBT SECURITIES AND GUARANTEES
The debt securities covered by this prospectus may be issued under one or more indentures. Unless otherwise specified in the applicable
prospectus supplement, the trustee under the applicable indenture will be Wilmington Trust, National Association. The particular terms of the debt securities offered and their guarantees, if any, will
be outlined in a prospectus supplement. The discussion of such terms in the prospectus supplement is subject to, and qualified in its entirety by, reference to all provisions in the applicable
indenture and any applicable supplemental indenture.
As
noted above, the debt securities may be guaranteed by one or more of AerCap's subsidiaries if so provided in the applicable prospectus supplement. The prospectus supplement will
describe the terms of any guarantees, including, among other things, the ranking of the guarantee, the method for determining the identity of the guarantors and the conditions under which guarantees
will be added or released. Any guarantees will be joint and several obligations of the guarantors.
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CERTAIN IRISH, NETHERLANDS AND U.S. FEDERAL INCOME TAX CONSEQUENCES
The material Irish, Netherlands and U.S. federal income tax consequences relating to the purchase and ownership of the debt securities
offered by this prospectus will be set forth in a prospectus supplement.
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PLAN OF DISTRIBUTION
We may sell the debt securities offered by this prospectus:
-
- through underwriters;
-
- through dealers;
-
- through agents; or
-
- directly to other purchasers.
The
prospectus supplement relating to any offering will identify or describe:
-
- any underwriters, dealers or agents;
-
- their compensation;
-
- the net proceeds to us;
-
- the purchase price of the debt securities;
-
- the initial public offering price of the debt securities; and
-
- any exchange on which the securities will be listed.
Underwriters
If we use underwriters in the sale, they will acquire the debt securities for their own account and may resell the debt securities from
time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. Unless we otherwise state in the
prospectus supplement, various conditions to the underwriters' obligation to purchase the debt securities apply, and the underwriters will be obligated to purchase all of the debt securities
contemplated in an offering if they purchase any of the debt securities. Any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers may be changed from
time to time.
Dealers
If we use dealers in the sale, unless we otherwise indicate in the prospectus supplement, we will sell debt securities to the dealers
as principals. The dealers may then resell the debt securities to the public at varying prices that the dealers may determine at the time of resale.
Agents and direct sales
We may sell debt securities directly or through agents that we designate, at a fixed price or prices which may be changed, or at
varying prices determined at the time of sale. Any such agent may be deemed to be an underwriter as that term is defined in the Securities Act. The prospectus supplement will name any agent involved
in the offering and sale and will state any commissions we will pay to that agent. Unless we indicate otherwise in the prospectus supplement, any agent is acting on a best efforts basis for the period
of its appointment.
Contracts with institutional investors and delayed delivery
If we indicate in the prospectus supplement, we will authorize underwriters, dealers or agents to solicit offers from various
institutional investors to purchase debt securities from it pursuant to contracts providing for payment and delivery on a future date that the prospectus supplement specifies. The underwriters,
dealers or agents may impose limitations on the minimum amount that the
11
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institutional
investor can purchase. They may also impose limitations on the portion of the aggregate amount of the debt securities that they may sell. These institutional investors
include:
-
- commercial and savings banks;
-
- insurance companies;
-
- pension funds;
-
- investment companies;
-
- educational and charitable institutions; and
-
- other similar institutions as we may approve.
The
obligations of any of these purchasers pursuant to delayed delivery and payment arrangements will not be subject to any conditions. However, one exception applies. An institution's
purchase of the particular debt securities cannot at the time of delivery be prohibited under the laws of any jurisdiction that governs the validity of the arrangements or the performance by us or the
institutional investor.
Indemnification
Agreements that we enter into with underwriters, dealers or agents may entitle them to indemnification by us against various civil
liabilities. These include liabilities under the Securities Act of 1933. The agreements may also entitle them to contribution for payments that they may be required to make as a result of these
liabilities. Underwriters, dealers and agents may be customers of, engage in transactions with, or perform services for, us in the ordinary course of business.
Market making
Unless otherwise noted in the applicable prospectus supplement, each series of debt securities will be a new issue of securities
without an established trading market. Various broker-dealers may make a market in the debt securities, but will have no obligation to do so, and may discontinue any market making at any time without
notice. Consequently, it may be the case that no broker-dealer will make a market in debt securities of any series or that the liquidity of the trading market for the debt securities will be limited.
Expenses
The expenses of any offering of debt securities will be detailed in the relevant prospectus supplement.
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ENFORCEMENT OF CIVIL LIABILITY JUDGMENTS UNDER IRISH LAW
As the United States is not a party to a convention with Ireland in respect of the enforcement of judgments, common law rules apply in
order to determine whether a judgment of the courts of the United States is enforceable in Ireland. A judgment of a court of the United States will be enforced by the courts in Ireland if the
following general requirements are met:
- (i)
- The
United States court must have jurisdiction under Irish conflict of law rules. If the Irish courts determine that the jurisdiction of the United States
court is not acceptable, then the judgment cannot be enforced or recognized in Ireland.
- (ii)
- The
judgment must be final and conclusive and the decree must be final and unalterable in the court that produces it. The enforcement of a judgment under
appeal in the United States will normally be stayed in Ireland pending the outcome of the appeal.
- (iii)
- When
enforcing an in personam judgment (action against a specific person as opposed to a judgment specific
to an asset), the amount in question must be a definite sum of money.
- (iv)
- Once
the United States court is shown to have jurisdiction, the Irish courts will not examine the merits of the judgment obtained in the United States.
- (v)
- Enforcement
proceedings should be instituted in Ireland within six years of the date of judgment.
There
are a number of possible defenses to an application to enforce a judgment of the courts of the United States in Ireland, including the following:
- (i)
- A
judgment obtained by fraud or trick will not be enforceable.
- (ii)
- A
judgment in breach of natural or constitutional justice will not be enforceable. This would include a failure to notify the other party of the hearing or
to give the other party a fair hearing.
- (iii)
- A
judgment contrary to Irish public policy is not enforceable. This would include, for example, among other things (i) a judgment obtained on foot
of a contract recognized as illegal in Ireland such as a contract in restraint of trade or (ii) a judgment granted on foot of foreign penal or revenue (tax) laws or expropriatory laws (the
latter of which would include certain laws permitting the requisitioning or confiscation of property).
- (iv)
- A
judgment inconsistent with a prior Irish judgment is not enforceable.
- (v)
- Jurisdiction
cannot be obtained by the Irish courts over judgment debtors in enforcement proceedings by personal service in Ireland or outside Ireland under
Order 11 of the Rules of the Superior Courts.
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ENFORCEMENT OF CIVIL LIABILITY JUDGMENTS UNDER DUTCH LAW
We are advised that there is no enforcement treaty between the Netherlands and the United States providing for reciprocal recognition
and enforcement of judgments, other than arbitration awards, in civil and commercial matters. Therefore, a judgment rendered by any federal or state court in the United States in such matters cannot
automatically be enforced in the Netherlands. An application will have to be made to the competent Dutch Court in order to obtain a judgment that can be enforced in the Netherlands. The Dutch courts
can in principle be expected to give conclusive effect to a final and enforceable judgment of a competent United States court in respect of the contractual obligations under the relevant document
without re-examination or re-litigation, but would require (i) that the relevant court in the United States had jurisdiction in the matter in accordance with standards that are generally
accepted internationally, (ii) the proceedings before such court to have complied with principles of proper procedure (behoorlijke
rechtspleging), (iii) such judgment not being contrary to the public policy of the Netherlands or the European Union, and (iv) that recognition and/or enforcement
of the judgment is not irreconcilable with a decision of a Dutch court rendered between the same parties or with an earlier decision of a foreign court rendered between the same parties in a dispute
that is about the same subject matter and that is based on the same cause, provided that such earlier decision can be recognized in the Netherlands, but the court will in either case have discretion
to attach such weight to the judgment of any federal or state court in the United States as it deems appropriate and may re-examine or re-litigate the substantive matters adjudicated upon.
Furthermore, a Dutch court may reduce the amount of damages granted by a federal or state court in the United States and recognize damages only to the extent that they are necessary to compensate
actual losses or damages.
Dutch
civil procedure differs substantially from U.S. civil procedure in a number of respects. Insofar as the production of evidence is concerned, U.S. law and the laws of several other
jurisdictions based on common law provide for pre-trial discovery, a process by which parties to the proceedings may prior to trial compel the production of documents by adverse or third parties and
the deposition of witnesses. Evidence obtained in this manner may be decisive in the outcome of any proceeding. No such pre-trial discovery process exists under Dutch law. In addition, it is doubtful
whether a Dutch court would accept jurisdiction and impose civil or other liability in an original action commenced in the Netherlands and predicated solely upon United States federal securities laws.
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LEGAL MATTERS
The validity of the debt securities will be passed upon for us by Cravath, Swaine & Moore LLP, New York, New York (with
respect to New York and United States federal law), McCann FitzGerald, Dublin, Ireland (with respect to Irish law), NautaDutilh N.V., Rotterdam, the Netherlands (with respect to Dutch law),
Morris, Nichols, Arsht & Tunnell LLP (with respect to Delaware law) and Buchalter Nemer, a Professional Corporation, Los Angeles, California (with respect to California law).
EXPERTS
The consolidated financial statements and management's assessment of the effectiveness of internal control over financial reporting
(which is included in Management's Report on Internal Control over Financial Reporting) incorporated in this prospectus by reference to AerCap Holdings N.V.'s Report on Form 6-K dated
April 23, 2015 have been so incorporated in reliance on the
report of PricewaterhouseCoopers Accountants N.V., an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
The
financial statements of International Lease Finance Corporation incorporated in this prospectus by reference to AerCap Holdings N.V.'s Report on Form 6-K dated
May 14, 2014 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm given on the authority of said firm as
experts in auditing and accounting.
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DISCLOSURE OF SEC POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Under Dutch law, AerCap is permitted to purchase directors' and officers' insurance. AerCap carries such insurance. In addition, the
articles of association of AerCap Holdings N.V., the articles of association of the Irish Issuer and the trust agreement relating to the U.S. Issuer each include indemnification of their
respective directors and officers against liabilities, including judgments, fines and penalties, as well as against associated reasonable legal expenses and settlement payments, to the extent this is
allowed under Dutch, Irish or U.S. law, respectively. To be entitled to indemnification, these persons must not have engaged in an act or omission of willful misconduct or bad faith. Insofar as such
indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling the applicable registrant pursuant to the foregoing provisions,
AerCap has been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the said Act and is therefore unenforceable.
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