<PAGE>
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10 - Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended............March 31, 1998.....
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ............ to ..............
Commission file number ....... 0-11350
INTERNATIONAL LEASE FINANCE CORPORATION
(Exact name of registrant as specified in its charter)
CALIFORNIA 22-3059110
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1999 AVENUE OF THE STARS LOS ANGELES, CALIFORNIA 90067
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code
(310) 788-1999
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes ____X____ No__________
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at July 30, 1997
----- ----------------------------
COMMON STOCK, NO PAR VALUE 35,818,122
<PAGE>
<PAGE>
INTERNATIONAL LEASE FINANCE CORPORATION AND SUBSIDIARIES
INDEX
Part I. Financial Information: Page No.
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets
March 31, 1998 and December 31, 1997 . . . . . . . . . 3
Condensed Consolidated Statements of Income
Three Months Ended March 31, 1998 and 1997 . . . . . . 4
Condensed Consolidated Statements of Cash Flows
Three Months Ended March 31, 1998 and 1997 . . . . . . 5
Note to Condensed Consolidated Financial Statements. . . . . 7
Item 2. Management's Discussion and Analysis of the
Financial Condition and Results of Operations. . . . 8
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . .10
Signatures . . . . . . . . . . . . . . . . . . . . . . . . .11
Index to Exhibits. . . . . . . . . . . . . . . . . . . . . .12
<PAGE>
<PAGE>
INTERNATIONAL LEASE FINANCE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
<TABLE>
<S> <C> <C>
March 31, December 31,
1998 1997
----------- ------------
(Unaudited)
ASSETS
Cash, including interest bearing accounts
of $54,625(1998) and $35,113(1997) $ 70,208 $ 63,754
Notes receivable 471,250 467,688
Net investment in finance and sales-
type leases 95,937 98,026
Flight equipment under operating leases 15,221,552 14,425,091
Less accumulated depreciation 1,705,296 1,632,560
---------- ----------
13,516,256 12,792,531
Deposits on flight equipment purchases 946,995 1,017,628
Accrued interest, other receivables
and other assets 72,169 60,416
Investments 18,910 18,731
Deferred debt issue costs-less
accumulated amortization of $54,509
(1998) and $52,444(1997) 33,187 33,180
------------- -------------
$ 15,224,912 $ 14,551,954
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Accrued interest and other payables $ 259,450 $ 214,106
Current income taxes 18,065 64,891
Debt financing, net of deferred debt
discount of $21,988(1998) and $8,424
(1997) 9,578,848 9,051,042
Capital lease obligations 887,044 903,320
Security & other deposits on flight
equipment 804,408 744,800
Rentals received in advance 127,099 129,586
Deferred income taxes 958,483 927,021
SHAREHOLDERS' EQUITY
Preferred stock--no par value; 20,000,000
authorized shares
Market Auction Preferred Stock, $100,000 per
share liquidation value; Series A,B,C,D,E
F,G and H (1998 and 1997) each having 500
shares issued and outstanding 400,000 400,000
Common stock--no par value; 100,000,000
authorized shares, 35,818,122 (1998
and 1997) issued and outstanding 3,582 3,582
Additional paid-in capital 579,955 579,955
Retained earnings 1,607,978 1,533,651
------------- -------------
2,591,515 2,517,188
------------- -------------
$ 15,224,912 $ 14,551,954
============= =============
</TABLE>
See note to condensed consolidated financial statements.
<PAGE>
<PAGE>
INTERNATIONAL LEASE FINANCE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997
(DOLLARS IN THOUSANDS)
<TABLE>
<S> <C> <C>
1998 1997
---------- ---------
(Unaudited)
REVENUES:
Rentals of flight equipment $ 431,452 $ 398,458
Flight equipment marketing 37,497 5,756
Interest and other 14,106 11,610
---------- ---------
483,055 415,824
---------- ---------
EXPENSES:
Interest 150,633 147,437
Depreciation 130,057 128,036
Rent expense 34,810 21,971
Provision for overhaul 25,356 21,856
Selling, general & administrative 10,279 10,553
----------- ---------
351,135 329,853
----------- ---------
INCOME BEFORE INCOME TAXES 131,920 85,971
Provision for income taxes 46,758 30,543
----------- ---------
NET INCOME $ 85,162 $ 55,428
=========== ==========
</TABLE>
SEE NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
<PAGE>
<PAGE>
INTERNATIONAL LEASE FINANCE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997
(DOLLARS IN THOUSANDS)
<TABLE>
<S> <C> <C>
1998 1997
--------- ---------
(Unaudited)
OPERATING ACTIVITIES:
Net Income $ 85,162 $ 55,428
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation of flight equipment 130,057 128,036
Deferred income taxes 31,462 63,901
Amortization of deferred debt
issue costs 2,866 2,066
Gain on sale of flight equipment
included in amount financed (1,673)
Equity in net income of affiliates (179) (319)
Change in unamortized debt discount (13,564) (166)
Changes in operating assets and liabilities:
Increase in accrued interest,
other receivables and other assets (11,751) (12,791)
Increase in current income taxes payable (46,827) (36,277)
Decrease in accrued interest and
other payables 45,344 30,608
(Decrease)Increase in rentals received
in advance (2,486) 9,922
--------- ---------
Net cash provided by operating activities 218,411 240,408
--------- ---------
INVESTING ACTIVITIES:
Acquisition of flight equipment
for operating leases (1,108,504) (1,324,069)
Decrease in deposits and progress payments 70,633 92,203
Proceeds from disposal of flight
equipment-net of gain 242,666 36,642
Collections on notes receivable 10,167 20,023
Collections on finance and sales-type leases 2,089 1,817
-------- --------
Net cash used in investing activities (782,949) (1,173,384)
--------- -----------
FINANCING ACTIVITIES:
Proceeds from debt financing 1,897,202 2,028,466
Payments in reduction of debt financing (1,372,108) (1,176,813)
Debt issue costs (2,874) (2,004)
Increase in customer deposits 59,606 87,980
Payment of common and preferred dividends (10,834) (8,085)
---------- ----------
Net cash provided by financing activities 570,992 929,544
---------- ----------
Increase in cash 6,454 (3,432)
Cash at beginning of period 63,754 36,558
---------- ----------
Cash at end of period $ 70,208 $ 33,126
========== ==========
</TABLE>
<PAGE>
<PAGE>
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
<TABLE>
<S> <C> <C>
1998 1997
---------- ---------
(Dollars in thousands)
(Unaudited)
Cash paid during the period for:
Interest (net of amount capitalized
$14,579(1998) and $11,953(1997)) $ 95,857 $ 100,974
Income taxes 62,122 2,920
</TABLE>
1998:
Notes in the amount of $13,730 were received as partial
payment in exchange for flight equipment sold with a book
value of $12,056.
SEE NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
<PAGE>
<PAGE>
INTERNATIONAL LEASE FINANCE CORPORATION AND SUBSIDIARIES
NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1998
(UNAUDITED)
A. The accompanying unaudited condensed consolidated financial
statements have been prepared in accordance with generally
accepted accounting principles for interim financial information
and in accordance with the instructions to Form 10-Q and Article
10 of Regulation S-X. Accordingly, they do not include all of
the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the
opinion of management, all adjustments (consisting only of
normal recurring accruals) considered necessary for a fair
presentation have been included. Certain reclassifications have
been made to the 1997 condensed consolidated financial
statements to conform to the 1998 presentation. Operating
results for the three months ended March 31, 1998 are not
necessarily indicative of the results that may be expected for
the year ended December 31, 1998. For further information,
refer to the consolidated financial statements and footnotes
thereto included in the Company's annual report on Form 10-K for
the year ended December 31, 1997.
<PAGE>
<PAGE>
INTERNATIONAL LEASE FINANCE CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FINANCIAL CONDITION
The Company borrows funds for the purchase of flight equipment,
including funds for progress payments during the construction
phase, principally on an unsecured basis from various sources. The
Company's debt financing was comprised of the following at the following
dates:
<TABLE>
<S> <C> <C>
March 31, December 31,
1998 1997
----------- ------------
(Dollars in thousands)
Public term debt with single
maturities $ 3,900,000 $ 3,950,000
Public medium-term notes with
varying maturities 2,983,365 2,896,865
ital lease obligations 887,044 903,320
------------ ------------
Total term debt and capital lease 7,770,409 7,750,185
obligations
Commercial paper 2,717,471 2,212,601
Less: Deferred debt discount (21,988) (8,424)
------------ -----------
Total Debt Financing and capital lease
obligations $ 10,465,892 $9,954,362
============ ==========
Composite interest rate 6.29% 6.44%
Percentage of total debt at fixed rates 71.92% 76.49%
Composite interest rate on fixed rate 6.58% 6.63%
debt
Bank prime rate 8.50% 8.50%
</TABLE>
The interest on substantially all of the public debt
(exclusive of the Commercial Paper) is fixed for the term of the
note. The Company has committed revolving loans and lines of
credit with 52 banks aggregating $2.75 billion and uncommitted
lines of credit with two banks for varying amounts mutually
agreed to by the Company and the banks. Bank debt principally
provides for interest rates that vary according to the pricing
option in effect at the time of borrowing and range from prime to
.20% over LIBOR to a rate determined by a competitive bid process
with the banks. Bank financings are subject to facility fees of
up to .08% of amounts available. Bank financing is used
primarily as backup for the Company's Commercial Paper program.
The Company has an effective shelf registration with respect
to $2.13 billion of debt securities, under which no notes were
sold through March 31, 1998. Additionally, a $750 million
Medium-Term Note Program has been implemented under the shelf
registration, under which $110.0 million has been sold through
March 31, 1998.
The Company believes that the combination of internally
generated funds and debt financing currently available to the
Company will allow the Company to meet its capital requirements
for at least the next 12 months.
<PAGE>
<PAGE>
INTERNATIONAL LEASE FINANCE CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS-Three months ended March 31, 1998 versus
1997.
The increase in revenues from the rentals of flight equipment
from $398.5 million in 1997 to $431.5 million in 1998, an 8.3%
increase, is attributable, in part, to the increase in the
relative cost of the leased fleet from $16.0 billion in 1997 to
$16.7 billion in 1998, a 4.7% increase. Additionally, due to
improved market conditions, the Company has negotiated more
favorable lease rates on aircraft that have been delivered in the
past twelve months. While the number of aircraft available for
operating lease has decreased from 342 at March 31, 1997 to 328
at March 31, 1998, the percentage of widebodies, for which higher
lease payments are typically received, has increased from 26% to
29% of the fleet.
In addition to its leasing operations, the Company engages in
the marketing of flight equipment on a principal and commission
basis, as well as the disposition of flight equipment at the end
of, or during, the lease term. Revenue from such flight
equipment marketing increased from $5.8 million in 1997 to $37.5
million in 1998 as a result of the type and the number of the
flight equipment marketed in each period which increased from
three aircraft in the first quarter of 1997 to 12 aircraft in the
first quarter of 1998. In addition, the Company sold one engine
in the first quarter of 1997 and two engines in the first quarter
of 1998.
While gross debt outstanding at quarter end decreased from
$10.7 billion in 1997 to $10.5 billion at 1998, interest expense
increased from $147.4 million in 1997 to $150.6 million in 1998
primarily as a result of an increase in the Company's composite
borrowing rate, which fluctuated as follows:
1998 1997 Increase
------- -------- --------
Beginning of Quarter 6.44% 6.23% .21%
End of Quarter 6.29% 6.20% .09%
------- -------- --------
Average 6.37% 6.22% .15%
Depreciation of flight equipment increased from $128.0 million
in 1997 to $130.1 million in 1998 due to the increased cost of
the fleet.
Rent expense increased from $22.0 million in 1997 to $34.8
million in 1998 due to the increase in the number of sale-lease
back transactions from 14 aircraft in the first quarter of 1997
to 20 in the first quarter of 1998.
Provision for overhauls increased from $21.9 million in 1997
to $25.4 million in 1998 due to an increase in the number of
aircraft on which the Company collects overhaul reserves
resulting in an increase in the aggregate number of hours flown
for which overhaul reserves are provided.
<PAGE>
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits:
10. Supplemental Agreement No. 1 to Purchase
Agreement No. 1916, dated as of February 9, 1998,
between the Company and The Boeing Company, including
Letter Agreements relating thereto (certain information
has been omitted and has been filed separately with the
Commission pursuant to a request for confidential
treatment).
12. Computation of Ratios of Earnings
27. Financial Data Schedule
b) Reports on Form 8-K:
1. Form 8-K, event date January 5, 1998 (Item 7)
2. Form 8-K, event date January 12, 1998 (Item 7)
3. Form 8-K, event date March 10, 1998 (Item 7)
<PAGE>
<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 thereunto duly
authorized.
INTERNATIONAL LEASE FINANCE CORPORATION
August 12, 1997 /S/ Leslie L. Gonda
-------------------
LESLIE L. GONDA
Chairman of the Board
May 1, 1998 /S/ Alan H. Lund
----------------
ALAN H. LUND
Executive Vice President
Co-Chief Operating Officer
and Chief Financial Officer
<PAGE>
<PAGE>
INTERNATIONAL LEASE FINANCE CORPORATION AND SUBSIDIARIES
INDEX TO EXHIBITS
Exhibit No.
10. Supplemental Agreement No. 1 to Purchase Agreement
No. 1916, dated as of February 9, 1998, between the
Company and The Boeing Company, including Letter
Agreements relating thereto (certain information has
been omitted and has been filed separately with the
Commission pursuant to a request for confidential
treatment).
12. Computation of Ratios of Earnings
27. Financial Data Schedule
Supplemental Agreement No. 1
to
Purchase Agreement No. 1916
between
The Boeing Company
and
INTERNATIONAL LEASE FINANCE CORPORATION
Relating to Boeing Model 777-200 Aircraft
THIS SUPPLEMENTAL AGREEMENT, entered into as of the 9th day of
February, 1998, by and between THE BOEING COMPANY, a Delaware
corporation (Boeing), and International Lease Finance Corporation,
a corporation with its principal office in the City of Los Angeles,
State of California, (Buyer);
W I T N E S S E T H:
-------------------
WHEREAS, the parties hereto entered into Purchase Agreement
No. 1916 dated June 24, 1996, relating to Boeing Model 777-200
aircraft (the Agreement) and
WHEREAS, the parties desire to supplement the Agreement as
hereinafter set forth, to (i) recalculate the Advance Payment
Base Prices for all Aircraft as defined in Article 3.4.2. of the
Agreement, (ii) revise the engine allocations for the * and *
Aircraft and (iii) add previously executed letter agreements
6-1162-JDR-267R1, 6-1162-SSM-435 and 6-1162-SSM-482, as well
as certain additional changes as set forth herein,
NOW THEREFORE, in consideration of the mutual covenants
herein contained, the parties hereto agree as follows:
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.
<PAGE>
<PAGE>
1. The Table of Contents is deleted in its entirety and
is replaced by a new Table of Contents. Such revised Table of
Contents is attached hereto and incorporated into the Agreement
by this reference.
2. Table 1 to the Purchase Agreement entitled "Aircraft
Deliveries and Descriptions," is deleted in its entirety and
is replaced by a new Table 1 reflecting (i) the recalculation
of the Advance Payment Base Prices for all Aircraft, (ii)
installation of Rolls Royce engines in lieu of Pratt and Whitney
engines in the * Aircraft and (iii) installation of Pratt and
Whitney engines in lieu of Rolls Royce engines on the * Aircraft.
Such revised Table 1 is attached hereto and incorporated into
the Agreement by this reference.
3. Previously executed Letter Agreement No. 6-1162-JDR-267R1,
entitled "Certain Contractual Matters", supersedes and replaces
Letter Agreement No. 6-1162-JDR-267 in its entirety and is
incorporated into the Agreement by this reference. Letter
Agreement No. 6-1162-JDR-267R1 * the amount that the airframe
credit memoranda for the * will be * in accordance with paragraph
1.1.1 and clarifies the application of credit memoranda to
operational weight increases.
4. Previously executed Letter Agreement No. 6-1162-SSM-435,
entitled " * Matters", supersedes and replaces Letter Agreement No.
6-1162-JDR-273 in its entirety and is incorporated into the
Agreement by this reference.
5. Previously executed Letter Agreement No. 6-1162-SSM-482,
entitled " * Operator Matters - Model 737, 747, 757, 767, 777
Aircraft", supersedes and replaces Letter Agreement No.
6-1162-JDR-271 in its entirety and is incorporated into the
Agreement by this reference.
6. Boeing and Buyer agree that the terms and conditions
of Letter Agreement No. 1916-1, shall apply to this Supplemental
Agreement No. 1 and related letter agreements.
The Agreement shall be deemed to be supplemented to the
extent herein provided and as so supplemented shall continue in
full force and effect.
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.
<PAGE>
<PAGE>
EXECUTED IN DUPLICATE as of the day and year first above written.
THE BOEING COMPANY INTERNATIONAL LEASE
FINANCE CORPORATION
By: /s/ J.D. ROBINSON BY: /s/ MARTIN OLSON
----------------------- ---------------------------
Its: Attorney-In-Fact Its: Dir - Marketing
---------------------- ---------------------------
<PAGE>
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C> <C>
Page SA
Number Number
------ ------
ARTICLES
1. Subject Matter of Sale. . . . . . . . . . . .1-1
2. Delivery, Title and Risk
of Loss . . . . . . . . . . . . . . . . . . .2-1
3. Price of Aircraft . . . . . . . . . . . . . .3-1
4. Taxes . . . . . . . . . . . . . . . . . . . .4-1
5. Payment . . . . . . . . . . . . . . . . . . .5-1
6. Excusable Delay . . . . . . . . . . . . . . .6-1
7. Changes to the Detail
Specification . . . . . . . . . . . . . . . .7-1
8. Federal Aviation Requirements and
Certificates and Export License . . . . . . .8-1
9. Representatives, Inspection,
Flights and Test Data . . . . . . . . . . . .9-1
10. Assignment, Resale or Lease. . . . . . . . .10-1
11. Termination for Certain Events . . . . . . .11-1
12. Product Assurance; Disclaimer and
Release; Exclusion of Liabilities;
Customer Support; Indemnification
and Insurance . . . . . . . . . . . . . . ..12-1
13. Buyer Furnished Equipment and
Spare Parts . . . . . . . . . . . . . . . ..13-1
14. Contractual Notices and Requests . . . . . 14-1
15. Miscellaneous. . . . . . . . . . . . . . . .15-1
TABLES
1. Aircraft Deliveries and
Descriptions. . . . . . . . . . . . . . . . .S-1 SA-1
/TABLE
<PAGE>
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
SA
Number
---------
EXHIBITS
- ---------
A Aircraft Configuration . . . . . . . . . . . .
B Product Assurance Document . . . . . . . . . .
C Customer Support Document. . . . . . . . . . .
D Price Adjustments Due to
Economic Fluctuations -
Airframe and Engines. . . . . . . . . . . . . .
E Buyer Furnished Equipment
Provisions Document . . . . . . . . . . . . . .
F Defined Terms Document . . . . . . . . . . . .
LETTER AGREEMENTS
- -----------------
1916-1 Disclosure of Confidential
Information . . . . . . . . . . . . . . . .
1916-2 Waiver of Aircraft Demonstration
Flights . . . . . . . . . . . . . . . . . .
1916-3 Seller Purchased Equipment. . . . . . . . .
1916-4 Spare Parts Support for Flight
Training. . . . . . . . . . . . . . . . . .
1916-5 Promotional Support . . . . . . . . . . . .
1916-6 Configuration Decision Matters. . . . . . .
1916-7 Price Adjustment on Rolls-Royce
Engines . . . . . . . . . . . . . . . . . .
</TABLE>
<PAGE>
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
SA
Number
------
RESTRICTED LETTER AGREEMENTS
- ----------------------------
6-1162-JDR-266 Aircraft Performance
Guarantees . . . . . . . . . . .
6-1162-JDR-267R1 Certain Contractual
Matters. . . . . . . . . . . . . SA-1
6-1162-JDR-268 Advance Payment Matters . . . . .
6-1162-JDR-269 Aircraft Configuration
Matters. . . . . . . . . . . . . .
6-1162-JDR-270 Lessee Matters. . . . . . . . . .
6-1162-JDR-271 * Operator Matters -
SUPERSEDED . . . . . . . . . . . . SA-1
6-1162-JDR-272 Delivery Schedule Matters . . . .
6-1162-JDR-273 * Matters - SUPERSEDED. . . . . . SA-1
6-1162-JDR-274 Miscellaneous Matters . . . . . .
6-1162-JDR-275 Option Aircraft . . . . . . . . .
6-1162-JDR-276 Assignment of Rights, * and *
Matters. . . . . . . . . . . . . .
6-1162-SSM-435 * Matters . . . . . . . . . . . . SA-1
6-1162-SSM-482 * Operator Matters - Model
737, 747, 757, 767, 777
Aircraft . . . . . . . . . . . . . SA-1
</TABLE>
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
Table 1 to
Purchase Agreement
Aircraft Deliveries and Descriptions
Model 777 Aircraft
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Article Article
Base 3.2 3.4
Month/ Air- Aircraft Advance
Year Quantity/ Detail frame Special Engine Basic Payment
of Model Specification Exhibit Price Features Price Price Base
Delivery Aircraft No. and Date Number (*) (*) (*) (*) Price
- -------- -------- ------------- ------- ---- -------- ------ -------- ------
* One(1)/ D019W004-ILF- A-3 * * * * *
777-200 3,Rev New RR
* One(1)/ D019W004-ILF- A-2 * * * * *
777-200 2,Rev New PW
* One(1)/ D019W004-ILF- A-3 * * * * *
777-200 3,Rev New RR
* One(1)/ D019W004-ILF- A-2 * * * * *
777-200 2,Rev New PW
* One(1)/ D019W004-ILF- A-1 * * * * *
777-200 1,Rev New GE
* One(1)/ D019W004-ILF- A-1 * * * * *
777-200 1,Rev New GE
* One(1)/ D019W004-ILF- A-2 * * * * *
777-200 2,Rev New PW
* One(1)/ D019W004-ILF- A-1 * * * * *
777-200 1,Rev New GE
* One(1)/ D019W004-ILF- A-1 * * * * *
777-200 1,Rev New GE
* One(1)/ D019W004-ILF- A-3 * * * * *
777-200 3,Rev New RR
* One(1)/ D019W004-ILF- A-1 * * * * *
777-200 1,Rev New GE
* One(1)/ D019W004-ILF- A-1 * * * * *
777-200 1,Rev New GE
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.
<PAGE>
<PAGE>
Table 1 to
Purchase Agreement
Aircraft Deliveries and Descriptions
Model 777 Aircraft
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Article Article
Base 3.2 3.4
Month/ Air- Aircraft Advance
Year Quantity/ Detail frame Special Engine Basic Payment
of Type of Specification Exhibit Price Features Price Price Base
Delivery Aircraft No. and Date Number (*) (*) (*) (*) Price
- -------- -------- ------------- ------- ---- -------- ------ -------- ------
* One(1)/ D019W004-ILF- A-2 * * * * *
777-200 2,Rev New PW
* One(1)/ D019W004-ILF- A-1 * * * * *
777-200 1,Rev New GE
* One(1)/ D019W004-ILF- A-1 * * * * *
777-200 1,Rev New GE
* One(1)/ D019W004-ILF- A-3 * * * * *
777-200 3,Rev New RR
* One(1)/ D019W004-ILF- A-1 * * * * *
777-200 1,Rev New GE
* One(1)/ D019W004-ILF- A-1 * * * * *
777-200 1,Rev New GE
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.
</TABLE>
<PAGE>
<PAGE>
[LETTERHEAD TO BOEING COMMERCIAL AIRPLANE GROUP]
Subject: * Matters
Reference: Purchase Agreements No. 2077, 2078, 2079, 2080,
2081 (The Purchase Agreements) and Purchase
Agreements No. 1768, 1769, 1770, 1771, 1772,
1829, 1830 And 1916 (the Previous Purchase
Agreements) between the Boeing Company (Boeing)
and International Lease Finance Corporation
(Customer) relating to Model 737, 747, 757, 767,
777 Aircraft (the Aircraft)
This Letter Agreement amends the Purchase Agreements and the
Previous Purchase Agreements between the Boeing Company (Boeing)
and International Lease Finance Corporation (Customer) relating
to Model 737, 747, 757, 767, 777 Aircraft (the Aircraft).
All terms used and not defined in this Letter Agreement, shall
have the same meaning as in the Purchase Agreement.
1. *
1.1 *
1.2 *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-SSM-534 Page 2
1.2.1 *
1.2.2 *
1.2.3 *
1.2.4 *
1.2.5 *
2. *
2.1 *
2.2 *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.
<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-SSM-435 Page 3
2.3 *
2.4 *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-SSM-435 Page 4
3. *
3.1 *
3.2 *
3.3 *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.
<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-SSM-435 Page 5
3.4 *
4. *
5. *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-SSM-435 Page 6
6. Confidentiality.
Customer understands that certain commercial and
financial information contained in this Letter Agreement are
considered by Boeing as confidential. Customer agrees that it
will treat this Letter Agreement and the information contained
herein as confidential and will not, without the prior written
consent of Boeing, disclose this Letter Agreement or any
information contained herein to any other person or entity.
Very truly yours,
THE BOEING COMPANY
BY /s/ SCOTT MASSEY
-----------------
Its Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date: November 17, 1997
INTERNATIONAL LEASE FINANCE CORPORATION
BY /s/ R.G. DUNCAN
-----------------------
R.G. Duncan
Its Senior Vice President
<PAGE>
<PAGE>
[LETTERHEAD TO BOEING COMMERCIAL AIRPLANE GROUP]
6-1162-JDR-267R1
International Lease Finance Corporation
1999 Avenue of the Stars, 39th Floor
Los Angeles, California 90067
Subject: Letter Agreement No. 6-1162-JDR-267R1 to
Purchase Agreement No. 1916 - Certain Contractual
Matters
Gentlemen:
This Letter Agreement supersedes and replaces Letter Agreement
6-1162-JDR-267 dated June 24, 1996.
This Letter Agreement amends Purchase Agreement No. 1916 (The
Agreement) between the Boeing Company (Boeing) and International
Lease Finance Corporation (Buyer) relating to Model 777 aircraft
(the Aircraft).
All terms used and not defined herein shall have the same meaning
as in the Agreement.
1. Credit Memoranda.
----------------
1.1 Airframe Credits - Aircraft. In consideration
of the purchase of the Aircraft, Boeing will issue a credit
memorandum for each Aircraft at the time of delivery in an amount
determined by *
1.1.1 Reduction of Certain Credit Memoranda
Amounts. The amount of each such credit memorandum to be issued
for the Aircraft scheduled for delivery in *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-JDR-267R1 Page 2
will be reduced by * at *.
1.1.2 Revised Delivery Schedule. Either
pursuant to the Agreement or by mutual agreement between Boeing
and Buyer, in the event the scheduled month of delivery of any
Aircraft is revised or Model 737 aircraft are substituted for one
Aircraft such that the Affected Aircraft scheduled months of
delivery are revised from those identified in paragraph 1.1.1
herein and/or the Affected Aircraft are no longer the initial
eight Aircraft delivered under the Agreement, Boeing and Buyer
agree (i) that the reduction in credit memorandum will apply to
each of the initial eight Aircraft to be delivered under the
Agreement and (ii) the amount of the credit memorandum reduction
for each of the initial eight Aircraft will be recalculated such
that the net present value of the reductions for the initial
eight Aircraft to be delivered under the revised delivery
schedule is equal to the net present value of the reductions for
the Affected Aircraft, as defined in paragraph 1.1.1 herein.
1.2 *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-JDR-267R1 Page 3
1.4 Application of Credit Memoranda. Such credit
memoranda may be utilized by Buyer for the purchase of * or
applied against the balance of the purchase price of the Aircraft
for which such credit is issued, * but may not be used for the
purchase of other aircraft or application against advance
payments for any Aircraft.
1.5 Engine Thrust Changes. As shown in Attachment B
to Letter Agreement No. 6-1162-JDR-269, for engines from the same
manufacturer, *. In the event Boeing revises its pricing policy
for other Model 777 engine thrust increases such that the price
for increasing engine thrust in production for engines from the
same manufacturer includes an airframe component and Buyer
subsequently elects to increase the engine thrust of any Aircraft
prior to delivery for engines from the same manufacturer, *.
1.6 *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-JDR-267R1 Page 4
2. Cooperative Marketing Agreement.
-------------------------------
It is recognized by Boeing and Buyer that Buyer may, from
time to time, require assistance from Boeing in product-related
areas such as sales presentations, route analysis and similar
activities in order to successfully market the Aircraft. Boeing
agrees to cooperate with Buyer in the above-mentioned activities
for the period commencing on the date of execution of the
Purchase Agreement and ending on the later of December 31, 2004,
or at delivery of the last Aircraft, unless earlier termination
is mutually agreed. Boeing further agrees to meet with Buyer
from time to time during such period to review sales campaigns of
mutual interest.
The above cooperative marketing agreement is subject to the
following conditions:
(i) all financial transactions and any lease-related
incentives to be provided by Buyer to its lessees shall be the
sole responsibility of Buyer and Boeing's financial commitments
in support of any transaction involving any Aircraft shall be
limited to the business arrangements between Boeing and Buyer set
forth in the Purchase Agreement for any such Aircraft unless
otherwise specifically agreed to by Boeing and Buyer and included
in the Purchase Agreement by written amendment; and
(ii) Nothing contemplated in this paragraph 2 shall in
any way restrict either party from pursuing those independent
sales activities which either considers in its own best interests
without concern for the effects of any such action on the other
party; and
(iii) The cooperation contemplated hereunder shall in
no way require either party to disclose to the
<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-JDR-267R1 Page 5
other any data or interests of any customer or potential customer
provided to either party in confidence by that customer or
potential customer or which is proprietary to either party.
Nothing in this paragraph 2 or elsewhere in this Purchase
Agreement shall be deemed to create a joint venture, agency or
other mutual legal relationship between the parties and the sole
relationship of Boeing and Buyer is one of seller and purchaser
of the Aircraft.
*
3. Credit Memorandum *.
--------------------
*
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-JDR-267R1 Page 6
4. *
5. Improvement of *.
------------------
In consideration of the purchase of the Aircraft, Boeing
will *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-JDR-267R1 Page 7
An appropriate amendment to the above affected purchase agreement
will be executed by Buyer and Boeing simultaneously with the
Agreement.
6. Application to * Aircraft.
-------------------------
The terms of this Agreement, including amending Letter
Agreements executed simultaneously with the Agreement but
excluding the provisions of paragraphs 1.1 And 1.3 Of this Letter
Agreement, are applicable to *
7. Special Credit Consideration.
----------------------------
In consideration of the purchase of the Aircraft *,
Boeing will issue a special credit memorandum of *. Such credit
memoranda may be utilized by Buyer for the purchase of *.
8. Deletion of Option Aircraft.
---------------------------
In consideration of the purchase of the Aircraft, Boeing
agrees to (i) cancel one Model 757-200 option * and (ii) cancel
one Model 767-300 option *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-JDR-267R1 Page 8
Appropriate amendments to the above affected purchase agreements
will be executed by Buyer and Boeing simultaneously with the
Agreement.
<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-JDR-267R1 Page 9
9. Confidentiality.
----------------
Buyer understands that certain commercial and financial
information contained in this Letter Agreement are considered by
Boeing as confidential. Buyer agrees that it will treat this
Letter Agreement and the information contained herein as
confidential and will not, without the prior written consent of
Boeing, disclose this Letter Agreement or any information
contained herein to any other person or entity, except as
provided in Letter Agreement 1916-1.
Very truly yours,
THE BOEING COMPANY
By /s/ SCOTT MASSEY
----------------
Its Attorney-In-Fact
ACCEPTED AND AGREED TO THIS 17
day of November, 1997
INTERNATIONAL LEASE FINANCE CORPORATION
By /s/ R.G. DUNCAN
--------------------
R.G. Duncan
Its Senior Vice President
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.
<PAGE>
<PAGE>
[LETTERHEAD TO BOEING COMMERCIAL AIRPLANE GROUP]
6-1162-SSM-482
International Lease Finance Corporation
1999 Avenue of the Stars, 39th Floor
Los Angeles, CA 90067
Subject: * Operator Matters - Model 737, 747, 757,
767, 777 Aircraft
Reference: Purchase Agreement Nos. 1768, 1769, 1770, 1771,
1772, 1829, 1830, 1916 (The Purchase Agreements)
between the Boeing Company (Boeing) and
International Lease Finance Corporation (Buyer)
relating to Model 737, 747, 757, 767, 777
aircraft (the Aircraft)
This letter agreement amends the following Purchase
Agreements, as amended, between The Boeing Company (Boeing) and
International Lease Finance Corporation (Buyer) relating to
certain aircraft as listed below (the Aircraft).
<TABLE>
<S> <C> <C> <C>
Purchase Agreement Aircraft Model Date Executed
------------------ -------------- ------------------
1768 747-400 December 15, 1992
1769 777-200B December 15, 1992
1770 767-300ER December 15, 1992
1771 757-200 December 15, 1992
1772 737-300/-400/-500 December 15, 1992
1829 737-300/-400/-500 June 27, 1995
1830 737-600/-700/-800 June 27, 1995
1916 777-200B June 24, 1996
</TABLE>
All terms used and not defined herein shall have the same
meaning as in the Purchase Agreements.
1. *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-SSM-482 Page 2
2. *
3. *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-SSM-482 Page 3
4. *
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.
<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-SSM-482 Page 4
5. *
6. Reports.
--------
Boeing agrees to provide quarterly reports to Buyer of
the status of *.
7. Supersedure of Existing Letter Agreements.
-----------------------------------------
The following letter agreements are superseded and
replaced in their entirety by this Letter Agreement.
Letter Agreement No. 6-1162-RLL-470 to PA Nos. 1768,
1769, 1770, 1771 and 1772
Letter Agreement No. 6-1162-KRG-1432 to PA No. 1829
Letter Agreement No. 6-1162-KRG-1447 to PA No. 1830
Letter Agreement No. 6-1162-JDR-271 to PA No. 1916
8. Simultaneous Execution of Certain Agreements.
--------------------------------------------
Considerations provided to Buyer by Boeing in this letter
agreement are conditioned upon simultaneous execution of this
letter agreement, Aircraft General Terms Agreement AGTA-ILF (the
AGTA), Purchase Agreements 2077, 2078, 2079, 2080, 2081, and
associated letter agreements.
__________
* Pursuant to 17 CFR 240.24b-2, confidential information has
been omitted and has been filed separately with the Securities
and Exchange Commission.<PAGE>
<PAGE>
International Lease Finance Corporation
6-1162-SSM-482 Page 5
9. Confidentiality. Buyer understands that certain
commercial and financial information contained in this letter
agreement are considered by Boeing as confidential. Buyer agrees
that it will treat this letter agreement and the information
contained herein as confidential and will not, without the prior
written consent of Boeing, disclose this letter agreement or any
information contained herein to any other person or entity.
Very truly yours,
THE BOEING COMPANY
By /s/ SCOTT MASSEY
----------------
Its Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date: November 17, 1997
INTERNATIONAL LEASE FINANCE CORPORATION
By /s/ R.G. DUNCAN
----------------
R.G. Duncan
Its Senior Vice President
INTERNATIONAL LEASE FINANCE CORPORATION AND SUBSIDIARIES
COMPUTATION OF RATIOS OF EARNINGS FOR THE THREE MONTHS ENDED
MARCH 31, 1998 AND 1997
(DOLLARS IN THOUSANDS)
<TABLE>
<S> <C> <C>
1998 1997
----------- ------------
(Unaudited)
Earnings:
Net Income $ 85,162 $ 55,428
Add:
Provision for income taxes 46,758 30,543
Fixed charges 186,444 172,600
Less:
Capitalized interest 14,579 11,953
----------- ------------
Earnings as adjusted (A) $ 303,785 $ 246,618
----------- ------------
Preferred dividend requirements $ 4,334 $ 4,085
Ratio of income before provision
for income taxes to net income 155% 155%
----------- ------------
Preferred dividend factor on pretax
basis 6,718 6,332
----------- ------------
Fixed Charges:
Interest expense 150,633 147,437
Capitalized interest 14,579 11,953
Interest factor of rents 21,232 13,210
----------- ------------
Fixed charges as adjusted (B) 186,444 172,600
----------- ------------
Fixed charges and preferred stock
dividends (C) $ 193,162 $ 178,932
----------- ------------
Ratio of earnings to fixed charges
(A) divided by (B) 1.63x 1.43x
----------- ------------
Ratio of earnings to fixed charges
and preferred stock dividends
(A) divided by (C) 1.57x 1.38x
----------- ------------
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE FINANCIAL STATEMENTS INCLUDED IN
THE REGISTRANT'S QUARTERLY REPORT ON FORM 10Q FOR THE
QUARTER ENDED MARCH 31, 1998 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 70,208
<SECURITIES> 0
<RECEIVABLES> 471,250
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 15,221,552
<DEPRECIATION> 1,705,296
<TOTAL-ASSETS> 13,516,256
<CURRENT-LIABILITIES> 0
<BONDS> 9,578,848
<COMMON> 3,582
0
400,000
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 15,224,912
<SALES> 431,452
<TOTAL-REVENUES> 483,055
<CGS> 0
<TOTAL-COSTS> 200,502
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 150,633
<INCOME-PRETAX> 131,920
<INCOME-TAX> 46,758
<INCOME-CONTINUING> 85,162
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 85,162
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
