Lease Investment Flight Trust modifies solicitation for note series

By Susanna Moon

Chicago, Nov. 3 - Lease Investment Flight Trust said it modified some of the proposed amendments in the consent solicitation for its subclass A-l notes, subclass A-2 notes, subclass A-3 notes, subclass B-1 notes, subclass B-2 notes, subclass C-1 notes, subclass C-2 notes, subclass D-1 notes and subclass D-2 notes.

The definition of required expense amount was changed to remove the three-month phase-in of the $5 million cap, according to a copy of the supplemental consent solicitation statement posted on the company's website.

The company is seeking permission for the company to establish reserves for expenses and provide it with the flexibility to incur certain hedging expenses during the period between payment dates.

Under the modified proposals, the senior notes blockage amount would be reduced to $28 million from $33 million and then reduced to zero on the payment date prior to the later of Dec. 31, 2024 and the sale of the last LIFT aircraft.

Originally, the proposal allowed the amount to be modified in the future by the controlling trustees.

As previously noted, the special-purpose Delaware business trust is seeking consents from holders of at least a majority of the notes to amend the notes.

No fees will be paid to holders in connection with the consent solicitation.

Lease Investment also said that an institution that controls the beneficial interests in about 20% of the outstanding notes intends to deliver its direction letter to consent to the proposed amendments based on the modifications.

As a result, the company said that it expects to get consents from holders of more than half the notes.

The solicitation began on Sept. 15, affecting $955,531,920.81 of outstanding notes overall. The deadline for the offer was extended to 5 p.m. ET on Nov. 16 from Oct. 17.

The following proposals remain unchanged:

• The sale or disposal of aircraft based upon a controlling trustees' resolution without having to comply with the current restrictions on such sales and dispositions;

• The controlling trustees to set, from time to time, the concentration limits and permitted countries for lessees without having to comply with the current geographical, lessee and other restrictions;

• Reduction of the cost of hull and other insurance to be at least equal to 100% of the adjusted base value of the aircraft rather than the current note target prices, which reflect both such adjusted base value and the outstanding balance of the notes;

• Elimination of the requirement that the trust obtain rating agency confirmations prior to taking certain actions under the indenture; and

• The amendment of the definition of rating agency to limit it to Standard & Poor's and Moody's Investors Service, Inc.

The overall purpose of the proposed amendments, according to a prior news release, is to provide Lease Investment with greater flexibility to, among other things, take advantage of market opportunities to sell aircraft.

Jefferies & Co., Inc. is the solicitation agent (203 363-8285; attn: Evan Wallach at ewallach@jefferies.com or 203 363-8286; James Palen at jpalen@jefferies.com).

The tabulation agent and information agent is Global Restructuring Services, Inc. (212 644-1772; attn: John Baxter at jbaxter@grserve.com).

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