SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES AND
EXCHANGE ACT OF 1934
August 12, 1999
(Date of Earliest Event Reported)
MORGAN STANLEY AIRCRAFT FINANCE
(Exact Name of Registrant as Specified in Trust Agreement)
Delaware
(State or Other Jurisdiction of Incorporation or Organization)
333-56575 13-3375162
(Commission File (IRS Employer
Number) Identification No.)
Morgan Stanley Aircraft Finance
c/o Wilmington Trust Company
1100 North Market Street
Rodney Square North
Wilmington, Delaware 19890-1000
Attention: Corporate Trust Administration
(302) 651-1000
(Address and Telephone Number, Including Area Code, of
Registrant's Principal Executive Office)
<PAGE>
Item 5. Other Events
Attached hereto as Exhibit A is a copy of a Monthly Report to Noteholders
dated August 12, 1999 sent to each holder of Notes due March 15, 2023 of Morgan
Stanley Aircraft Finance.
2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.
MORGAN STANLEY AIRCRAFT FINANCE
Date: August 12, 1999 By: /s/ Alexander Frank
-------------------------
Signatory Trustee
3
<PAGE>
EXHIBIT INDEX
Exhibit A - Report to Noteholders
4
MORGAN STANLEY AIRCRAFT FINANCE
Report to Noteholders
All amounts in US dollars unless otherwise stated
Payment Date 15th of each month
Convention Modified Following Business Day
Current Payment Date 16-Aug-99
Current Calculation Date 10-Aug-99
Previous Payment Date 15-Jul-99
Previous Calculation Date 9-Jul-99
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<TABLE>
1. Account Activity Summary between Calculation Dates
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Prior Deposits Withdrawals Balance on
Balance Calculation Date
9-Jul-99 10-Aug-99
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<S> <C> <C> <C> <C>
Expense Account 4,541,500.05 747,116.74 (1,978,634.21) 3,309,982.58
Collection Account 11,845,793.29 10,014,413.53 (11,845,796.29) 10,014,410.53
Aircraft Purchase Account - - - -
Liquidity Reserve cash balance 25,000,000.00 - - 25,000,000.00
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Total 42,111,887.45 10,761,530.27 (13,824,430.50) 38,324,393.11
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2. Analysis of Expenses Account Activity
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Opening Balance on Previous Calculation Date 4,541,500.05
Transfer from Collection Account on previous Payment Date 747,116.74
Permitted Aircraft Accrual
Interim Transfer to Collection Account (19,655.64)
Interest Income 19,655.64
Balance on current Calculation Date
- Payments on previous payment date (576,952.30)
- Interim payments (1,401,681.91)
- other
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Balance on current Calculation Date 3,309,982.58
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3. Analysis of Collection Account Activity
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Opening Balance on Previous Calculation Date 11,845,793.29
Collections during period
- lease rentals 7,650,081.00
- maintenance reserves 2,076,417.00
- other leasing income 132,172.00
- interest income 136,087.89
- interim transfer from Expense A/C 19,655.64
Transfers from Aircraft Purchase Account -
Drawings under Credit or Liquidity Enhancement Facilities -
Repayment of Drawings under Credit or Liquidity Enhancement Facilities -
Transfer to Expense Account on previous Payment Date
- Required Expense Amount (747,116.74)
- Permitted Aircraft Modifications
Net Swap payments on previous Payment Date (876,875.00)
Aggregate Note Payments on previous Payment Date (10,221,804.55)
Interim Transfer to Expense Account
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Balance on current Calculation Date 10,014,410.53
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Analysis of Liquidity Reserve Amount
First Collection Account Reserve 15,000,000.00
Second Collection Account Reserve 10,000,000.00
Morgan Stanley Facility 10,000,000.00
ILFC Facility
- Letter of Credit 10,000,000.00
- Cash Security Deposits 20,003,351.00 30,003,351.00
-------------------
Liquidity Reserve Amount 65,003,351.00
-------------------
Minimum Liquidity Reserve Amount 15,000,000.00
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</TABLE>
<PAGE>
MORGAN STANLEY AIRCRAFT FINANCE
Report to Noteholders
All amounts in US dollars unless otherwise stated
Current Payment Date 16-Aug-99
Current Calculation Date 10-Aug-99
Previous Payment Date 15-Jul-99
Previous Calculation Date 9-Jul-99
<TABLE>
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<S> <C> <C>
Balance in Collection Account 10,014,410.53
Liquidity Reserve Amount 65,003,351.00
-----------------
Available Collections 75,017,761.53
=================
3. Analysis of Collection Account Activity (Continued)
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Analysis of Current Payment Date Distributions
(I) Required Expense Amount 2,506,893.76
(II) a) Class A Interest but excluding Step-up 3,127,804.20
b) Swap Payments other than subordinated swap payments 658,381.94
(iii) a) Repayment of Primary Eligible Credit Facilities -
b) First Collection Account top-up (Minimum liquidity reserve $15 m) 15,000,000.00
(iv) Class A Minimum principal payment -
(v) Class B Interest 478,365.69
(vi) Class B Minimum principal payment 319,635.38
(vii) Class C Interest 575,000.00
(viii) Class C Minimum principal payment -
(ix) Class D Interest 797,500.00
(x) Class D Minimum principal payment -
(xi) a) Secondary Eligible Credit Facilities (ILFC and Morgan Stanley Facilities) -
b) Second collection account top-up 50,003,351.00
(xii) Class A Scheduled principal -
(xiii) Class B Scheduled principal -
(xiv) Class C Scheduled principal -
(xv) Class D Scheduled principal -
(xvi) Permitted accruals for Modifications
(xvii) Step-up interest -
(xviii) Beneficial interest -
(xix) Class A Supplemental principal 1,550,829.55
(xx) Class B Supplemental principal -
(xxi) Class D Redemption Price -
(xxii) Class C Redemption Price -
(xxiii) Class B Redemption Price -
(xxiv) Class A Redemption Price -
(xxv) Subordinated Swap payments -
(xxvi) all remaining amounts to holders of Beneficial interests
Total Payments with respect to Payment Date 75,017,761.53
less collection Account Top Ups (iii) (b) and (xi) (b) above 65,003,351.00
----------------
10,014,410.53
================
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</TABLE>
<PAGE>
MORGAN STANLEY AIRCRAFT FINANCE
Report to Noteholders
All amounts in US dollars unless otherwise stated
Current Payment Date 16-Aug-99
Current Calculation Date 10-Aug-99
Previous Payment Date 15-Jul-99
Previous Calculation Date 9-Jul-99
<TABLE>
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4. Payments on the Notes by Subclass
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Subclass Subclass Subclass
(a) Floating Rate Notes A-1 A-2 B-1
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<S> <C> <C> <C>
Applicable LIBOR 5.18000% 5.18000% 5.18000%
Applicable Margin 0.2100% 0.3500% 0.6500%
Applicable Interest Rate 5.39000% 5.53000% 5.83000%
Day Count Act/360 Act/360 Act/360
Actual Number of Days 32 32 32
Interest Amount Payable 1,916,444.44 1,211,359.76 478,365.69
Step-up Interest Amount Payable - NA NA
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Total Interest Paid 1,916,444.44 1,211,359.76 478,365.69
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Expected Final Payment Date 15-Mar-00 15-Sep-05 15-Mar-13
Excess Amortisation Date 15-Mar-00 15-Apr-98 15-Apr-98
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Original Balance 400,000,000.00 340,000,000.00 100,000,000.00
Opening Outstanding Principal Balance 400,000,000.00 246,433,946.93 92,308,988.29
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Extended Pool Factors 100.00% 87.90% 98.28%
expected Pool Factors 100.00% 81.96% 94.45%
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Extension Amount - - -
expected Pool Factor Amount - - -
Surplus Amortisation - 1,550,829.55 319,635.38
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Total Principal Distribution Amount - 1,550,829.55 319,635.38
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Redemption Amount
- - amount allocable to principal
- - amount allocable to premium
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Closing Outstanding Principal Balance 400,000,000.00 244,883,117.38 91,989,352.91
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(b) Fixed Rate Notes C-1 D-1
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Applicable Interest Rate 6.90000% 8.70000%
Day count 30 / 360 30 / 360
Number of Days 30 30
Interest Amount Payable 575,000.00 797,500.00
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Total Interest Paid 575,000.00 797,500.00
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Expected Final Payment Date 15-Mar-13 15-Mar-14
Excess Amortisation Date 15-Mar-13 15-Mar-10
Opening Outstanding Principal Balance 100,000,000.00 110,000,000.00
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Extended Pool Factors 100.00% 100.00%
expected Pool Factors 100.00% 100.00%
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Extended Amount - -
expected Pool Factor amount - -
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Total Principal Distribution Amount - -
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Redemption Amount - -
- - amount allocable to principal - -
- - amount allocable to premium - -
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Closing Outstanding Principal Balance 100,000,000.00 110,000,000.00
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</TABLE>
<PAGE>
MORGAN STANLEY AIRCRAFT FINANCE
Report to Noteholders
All amounts in US dollars unless otherwise stated
Current Payment Date 16-Aug-99
Current Calculation Date 10-Aug-99
Previous Payment Date 15-Jul-99
Previous Calculation Date 9-Jul-99
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5. Floating Rate Note information for next Interest Accrual Period
Start of Interest Accrual Period 16-Aug-99
End of Interest Accrual Period 15-Jun-99
Reference Date 12-Aug-99
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A-1 A-2 B-1
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Applicable LIBOR 5.26875% 5.26875% 5.26875%
Applicable Margin 0.2100% 0.3500% 0.6500%
Applicable Interest Rate 5.47875% 5.6188% 5.9188%
Actual Pool Factor 100.00% 72.02% 91.99%
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Fixed Rate Notes C-1 D-1
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Actual Pool Factor 100.00% 100.00%
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6. Payments per $ 100,000 Inital Outstanding Principal Balance of Notes
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(a) Floating Rate Notes A-1 A-2 B-1
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Opening Outstanding Principal Balance 100,000.00 72,480.57 92,308.99
Total Principal Payments - 456.13 319.64
Closing Outstanding Principal Balance 100,000.00 72,024.45 91,989.35
Total Interest 479.11 356.28 478.37
Total Premium - - -
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(b) Fixed Rate Notes C-1 D-1
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Opening Outstanding Principal Balance 100,000.00 100,000.00
Total Principal Payments - -
Closing Outstanding Principal Balance 100,000.00 100,000.00
Total Interest 575.00 725.00
Total Premium - -
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<PAGE>
<TABLE>
% of Prospectus Gross
Lease Revenues
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Aug-15-99 Actual Prospectus* Variance Actual Prospectus* Variance
To Date To Date
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<S> <C> <C> <C> <C> <C> <C>
Cash Collections
Gross Lease Rentals 171,585,190 188,853,487 (17,268,297) 90.9% 100.0% -9.1%
Other leasing income 2,714,444 2,714,444 1.4% 0.0% 1.4%
Security Deposits 4,006,650 4,006,650 2.1% 2.1%
Repossession/Stress Related Costs - Actual (1,787,648) (8,498,407) 6,710,759 -0.9% -4.5% 3.6%
Repossession/Stress Related Costs - Accrued** (45,015) 0.0% 0.0% 0.0%
------------------------------------------ -----------------------------
Net Lease Rentals 176,473,620 180,355,080 (3,836,445) 93.4% 95.5% -2.0%
Maintenance Receipts 25,088,973 0 25,088,973 13.3% 0.0% 13.3%
Maintenance Expenses- Actual (11,453,519) 0 (11,453,519) -6.1% 0.0% -6.1%
Maintenance Expenses - Accrued** (4,958,983) (4,958,983) -2.6% 0.0% -2.6%
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Net Maintenance 8,676,471 0 8,676,471 4.6% 0.0% 4.6%
Interest Received 3,349,796 2,031,533 1,318,263 1.8% 1.1% 0.7%
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Total Cash Collections 188,499,887 182,386,612 6,158,289 99.8% 96.6% 3.3%
Cash Expenses
Cash Operating Expenses
- Insurance, re-leasing and other costs - Actual (1,647,148) (6,609,872) 4,962,724 -0.9% -3.5% 2.6%
- Insurance, re-leasing and other costs - Accrued** (94,952) (94,952) -0.1% 0.0% -0.1%
------------------------------------------ -----------------------------
subtotal (1,742,100) (6,609,872) 4,867,772 -0.9% -3.5% 2.6%
SG&A
- Servicer Fees (6,997,669) (8,057,504) 1,059,835 -3.7% -4.3% 0.6%
- Other Servicer provider fees and Overhead - Actual (3,852,129) (4,725,166) 873,037 -2.0% -2.5% 0.5%
- Other Servicer provider fees and Overhead - Accrued** (93,472) (93,472) 0.0% 0.0% 0.0%
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subtotal (10,943,270) (12,782,670) 1,839,401 -5.8% -6.8% 1.0%
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Total Cash Expenses (12,685,369) (19,392,542) 6,707,173 -6.7% -10.3% 3.6%
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NET CASH COLLECTIONS 175,814,517 162,994,070 12,820,447 93.1% 86.3% 6.8%
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Exceptional Items
- THY Note Distribution 27,143,085 27,143,085 0 14.4% 14.4% 0.0%
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TOTAL NET CASH COLLECTIONS 202,957,602 190,137,155 12,820,447 107.5% 100.7% 6.8%
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Interest Payments (Net of Swap effects) 99,830,072 101,814,109 (1,984,038) 52.9% 53.9% -1.1%
Principal Payments
A-1 0 0 0 0.0% 0.0% 0.0%
A-2 95,116,883 80,312,399 14,804,484 50.4% 42.5% 7.8%
B-1 8,010,647 8,010,647 (0) 4.2% 4.2% 0.0%
C-1 0 0 0 0.0% 0.0% 0.0%
D-1 0 0 0 0.0% 0.0% 0.0%
------------------------------------------ -----------------------------
subtotal 103,127,530 88,323,046 14,804,484 54.6% 46.8% 7.8%
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Total Payments to Noteholders 202,957,602 190,137,155 12,820,447 107.5% 100.7% 6.8%
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Benefical Interest Distributions (0) 0 (0) 0.0% 0.0% 0.0%
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*Prospectus Cash Collections and Cash Expenses have been adjusted for non-delivery of THY Aircraft, msn 25272.
**Accrued Expenses have been allocated to relevant expense categories.
Total Accrued Expenses on Payment Date: (5,192,422)
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</TABLE>
