International Lease Finance preferred holders consent to amendments

By Angela McDaniels

Tacoma, Wash., July 25 - International Lease Finance Corp. received the consents needed to amend two series of junior subordinated debenture due 2065, according to a company press release.

ILFC solicited consents from holders of two series of its enhanced capital advantaged preferred securities (Ecaps).

The Ecaps I represent preferred undivided beneficial ownership interests in the assets of ILFC E-Capital Trust I, a trust that holds a $600 million 5.9% junior subordinated debenture due 2065 issued by ILFC, and the Ecaps II represent preferred undivided beneficial ownership interests in the assets of ILFC E-Capital Trust II, a trust that holds a $400 million 6.25% junior subordinated debenture due 2065 issued by ILFC.

ILFC solicited consents to amend some provisions relating to financial tests.

The amendments will replace the definition of "tangible equity amount" used in calculating ILFC's ratio of equity to total managed assets with a definition for "total equity amount" that does not exclude ILFC's intangible assets from ILFC's total stockholders' equity as reflected on its consolidated balance sheet.

The amendments will also change the definition of "average four quarters fixed charge ratio" by replacing the definition of "adjusted earnings before interest and taxes" with a definition for "adjusted EBITDA," which will exclude interest, taxes, depreciation, amortization, all impairment charges and loss on extinguishment of debt when calculating the earnings portion of ILFC's average four quarters fixed charge ratio.

The consent solicitations began July 23 and were scheduled to run until the earlier of (i) 5 p.m. ET on the first date on which the required consents were received, but no earlier than 5 p.m. ET on July 25, and (ii) 5 p.m. ET on July 31.

The needed consents had been received as of 5 p.m. ET on July 25.

Holders had to be of record as of 5 p.m. ET on July 22.

Once the supplemental indentures containing the amendments are executed, holders will receive a consent payment of $20 for each $1,000 liquidation amount of Ecaps for which a consent was received.

When the consent solicitations began, the company said that without the amendments, a "mandatory trigger event" and, consequently, a "mandatory deferral event" would be more likely to occur. Therefore, had the proposed amendments not been approved, it would have been more likely that ILFC would be required to defer interest payments on a debenture.

J.P. Morgan Securities LLC (866 834-4660 or 212 834-4811) was the solicitation agent. D.F. King & Co., Inc. (800 714-3312, 212 269-5550 or ilfc@dfking.com) was the information and tabulation agent.

The issuer is an aircraft lessor based in Los Angeles. It is a wholly owned subsidiary of American International Group, Inc.

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