Investing in Midlife aircraft - What you need to know and how it led to a successful ABS - SPRITE - Why investors need to use this ABS as a ...
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Investing in Midlife aircraft – What you need to know and how it led to
a successful ABS – SPRITE – Why investors need to use this ABS as
a benchmark
March 2018
Private and Confidential
Important Information and Qualifications
Securities Disclaimer:
This confidential investor presentation (this “Presentation”) is for informational purposes only and highlights certain selected information about Sprite 2017-1 Limited and Sprite 2017-1 US LLC (together with their
subsidiaries, “Sprite” or the “Issuers”). This Presentation is not intended to be read separate from, or in lieu of, the offering memorandum with respect to the offering of the securities (the “offering memorandum”) as
supplemented by any term sheet or pricing supplement. This presentation is qualified in its entirety by reference to the offering memorandum with respect to the offering of the securities. You should rely only on the
information contained in the offering memorandum as supplemented by any term sheet or pricing supplement in making an investment decision and not this investor presentation.
THE SECURITIES DESCRIBED IN THIS PRESENTATION HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY
OTHER SECURITIES LAWS OF ANY JURISDICTION. ACCORDINGLY, THE SECURITIES DESCRIBED IN THIS PRESENTATION MAY ONLY BE OFFERED OR SOLD (1) IN THE UNITED STATES TO “QUALIFIED
INSTITUTIONAL BUYERS” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS (OTHER THAN DISTRIBUTORS)
UNLESS THE SECURITIES ARE REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IS AVAILABLE (“RULE 144A”))
(“QIBS”) IN RELIANCE ON THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144A AND (2) TO NON-U.S. PERSONS IN OFFSHORE TRANSACTIONS IN RELIANCE ON REGULATION S UNDER THE
SECURITIES ACT (“REGULATION S”). IF ANY SECURITIES ARE OFFERED AND SOLD, THEY WILL BE OFFERED AND SOLD BY THE ISSUERS OF SUCH SECURITIES. WITHOUT LIMITING THE FOREGOING,
NONE OF WORLD STAR AVIATION (UK) LIMITED, SPRITE AVIATION HOLDINGS DESIGNATED ACTIVITY COMPANY, CANYON FINANCIAL SERVICES LIMITED OR THEIR RESPECTIVE AFFILIATES (THE
“TRANSACTION PARTIES”) WILL PROVIDE CREDIT SUPPORT FOR OR OTHERWISE BE OBLIGATED IN ANY WAY WITH RESPECT TO ANY SECURITIES OFFERED OR SOLD BY THE ISSUER OR CO-ISSUERS
OR WITH RESPECT TO ANY OTHER DEBT OR OTHER LIABILITIES OF THE ISSUER OR CO-ISSUERS.
This Presentation does not constitute an offer or an invitation by, or on behalf of, Sprite, the Transaction Parties or any of Mizuho Securities USA LLC , Morgan Stanley & Co. LLC, or any of their respective affiliates (each
an “Initial Purchaser” and together with Sprite and the Transaction Parties, the “Relevant Parties”) to subscribe for or purchase any of the securities in any jurisdiction by any person or entity to whom it is unlawful to make
such an offer or solicitation in such jurisdiction.
Confidentiality: This Presentation is proprietary and is given for general informational purposes only, shall be kept strictly confidential and may not be reproduced or redistributed, in whole or in part, directly or indirectly to
any other person or entity. The distribution, disclosure and/or review of this Presentation and the information herein is subject to your agreement to keep it strictly confidential. If you do not so agree, do not turn the page
or review the information in this Presentation and return it immediately to the Relevant Parties. By accepting this Presentation, (1) you agree that you are (a) a QIB or (b) not a U.S. Person and are located outside of the
U.S. for purposes of Regulation S and (2) you understand that, the securities described herein have not been and will not be registered under the Securities Act or any other securities laws of any jurisdiction and may not
be offered, sold or otherwise transferred unless an exemption from registration under the Securities Act and other applicable securities laws is available.
No Commitment: You understand and agree that none of the Initial Purchasers has made any commitment to provide you or any of your affiliates or any other party on your behalf any financing, products or services with
respect to any matters contemplated by this Presentation.
No Representations: No representation or warranty or other assurance of any kind, express or implied, is made as to the accuracy, completeness or suitability of any information in this Presentation or any related written
or oral information made available, and nothing contained herein is, or shall be relied upon as, a representation, whether as to the past, the present or the future. By accepting this Presentation, the recipient agrees that
none of the Initial Purchasers nor any of their respective directors, partners, officers, employees, advisors, shareholders, agents, representatives and controlling persons (collectively, “Representatives”) has any liability
relating to or arising from the information in this Presentation or for any errors therein or omission therefrom or the reliance thereon by the recipient or any other person or the provision of this Presentation. The
information in this Presentation will be deemed to be automatically superseded and replaced by information provided in the future (whether pursuant to any independent investigation or otherwise) and information
contained in the offering memorandum and supplemental offering materials, if any.
Forward-looking Statements: This Presentation may contain certain forward-looking statements, projections, prior results, modeling, valuations or back-testing, which are included for illustration purposes only and are not
indicative of any future results. Any such statements, projections, prior results, modeling, valuations or back-testing reflect various estimates and assumptions. Many of these forward-looking statements are based on
significant assumptions that are described in the offering memorandum and must be read together with those assumptions. Whether or not any such forward-looking statements or projections are in fact achieved will
depend upon future events some of which are not within the control of the Relevant Parties. Actual results may vary from projected results and such variations may be material. No representation is made as to the
reasonableness of the assumptions made within or the accuracy or completeness of any forward-looking statements, projections, modeling, valuation or back-testing, or as to any past or future performance or other
results. None of the Relevant Parties undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
No Reliance on Initial Purchasers/Independent Assessment and Decisions: You understand and agree that no investment bank is acting as your agent, fiduciary or advisor with respect to any matters contemplated by this
Presentation. You should obtain your own independent advice on the financial, legal, accounting, and tax aspects of the subject matter of this Presentation. You agree that you are not relying and will not rely on any
communication (written or oral) of an investment bank as investment advice or as a recommendation to enter into any transaction, and that you are capable of assessing the merits of and understanding the proposed
transaction (on your own behalf or through independent professional advice), and should you enter into a definitive agreement with an investment bank or any other party referred to in this Presentation or contemplated by
the transactions described in this Presentation, you will do so because you have conducted such investigations and performed such diligence as you deemed appropriate and you understand and accept the terms and
conditions and risks (including, but not limited to, economic, competitive, operational, financial, credit, legal, accounting and tax risks) of such transaction. The Initial Purchasers do not in any way warrant, represent, or
guarantee the financial, accounting, legal or tax results of the transaction described in this Presentation nor does any investment bank hold itself out as a financial, legal, tax or accounting advisor to any party.
Aircraft Valuations: All values, percentages and averages relating to the appraised value of aircraft included in this Presentation (unless otherwise indicated) are based on the average of half-life base values of the aircraft
as of June 30, 2017 provided by Aircraft Information Services, Inc., BK Associates, Inc. and morten, beyer & agnew inc. adjusted to reflect projected maintenance status as of November 2017 as determined by Alton
Aviation Consultancy LLC. Such appraisals and maintenance forecast are included in the offering memorandum.
2
Table of Contents
Section I World Star Overview 4
Section II World Star Portfolio Management 14
Section III SPRTE 2017-1 24
3
Section II: World Star Overview
4
World Star at a Glance
World Star Overview Managed Fleet by Type(1)
Leading full-service aircraft management company with Over 80% of WSA’s managed fleet is Boeing 737 and
particular expertise in mid-to late-life model, high Airbus A320 family aircraft
quality, used commercial aircraft B737-400 6%
B737-300SF 2%
Established in 2003 and dual headquartered in San
Francisco and London, with additional presence in B737-800
Ireland, Israel, Singapore and Colombia (the company 18%
B777-300 5%
is fully owned by its principals) B737-300
20%
In-house acquisition, placement, structuring and
management capabilities with relationships around the
A319
world via an extensive network of contacts in all areas 18%
of acquisition, leasing, maintenance, conversion and A330-300 6%
disposal / sale A320
A330-200 5% 15%
Experienced management team with over four industry A321 5%
cycles of investing and operating experience in the
commercial aircraft sector: Managed Fleet by Region(1)
Demonstrated track record with proven deal flow
Established industry position
Significant connectivity within the market
Latin
Europe 48% America 12%
Middle East 3%
World Star Currently Service
North America
12%
67 Aircraft and Engines to
33 Lessees in 26 Countries Globally Asia-Pacific
21% Africa 4%
Notes:
1) Calculated by number of aircraft as of October 15, 2017 and includes the SPRITE 2017-1 portfolio 5
World Star in 3 Points
World Star applies WSA is a nimble, forward thinking company that retains the discipline,
structure and processes of a major company
institutional rigour and
All areas of aircraft investment management are covered in-house: investment
discipline in a boutique structuring, asset and investment management, aircraft technical and
environment accounts and finance
4 principals run an efficient business to minimize unnecessary costs
We don’t fall in love with the “aircraft” – instead, we buy “metal” that produces
World Star’s DNA is cash flows
heavily metal focused We like to roll up our sleeves and get our hands dirty
While World Star is Sale of aircraft on “as is, where is” basis
heavily involved with Acquisition of later life aircraft on end-of-life stub leases
mid-life aircraft, World Part-out of new, mid-life and older aircraft and engines
Star also has extensive
Refreshing/rebuilding run-out assets to return them to flying condition
monetization
Conversion of passenger aircraft into freighters
experience
6
World Star Team Composition
World Star’s 26 person-team underscores the commitment and rigor required for a successful mid-life aircraft
leasing platform
John Flynn, Chairman
Emeritus
Executive Team
Sean O’Connor Marc Iarchy Garreth Slevin Yoyo Allalouf
28 years of aviation experience 24 years of financing experience 22 years of aviation experience 18 years of leasing experience
Investment Lease Servicing Accounting and
Technical Aircraft Marketing
Management and Contracts Administration
Rob Tuck Raj Singh Christopher Butt Katherine Wang Alice Wong
Ricardo Barrera
Fred Plummer Riva Amar Alice Cordova Pauline Seeto
Medina
Juan Carlos Alvarez
David Rodriguez Brian Rainey Aya Monteverde Yulia Zhang
Velez
Americas
Viktor Janusevskij Tommy Guttmann USA - San Francisco Joo Kim
Columbia - Bogota
Locations
Europe
Stanislavas Parvickis Paulo Bettencourt UK – London
Ireland – Dublin
Israel – Tel Aviv
Lithuania - Vilnius
Anatolij Andruskevic
Asia
Singapore/Hong Kong
7
World Star Global Customer Base
Aircraft bought, sold and leased in over 70 Countries
Proven track record in acquiring, remarketing and disposing of aircraft worldwide
With global coverage, aircraft that require relocation are actively marketed in many countries through existing relationships
World Star’s portfolio is proactively managed to avoid continental, country and jurisdictional concentrations
Albania Argentina Australia Austria Bahamas Belgium Bermuda Bhutan Bolivia Brazil Bulgaria Canada China Colombia Croatia
Czech Rep. Denmark Ecuador Egypt Estonia France
Georgia Germany Greece Hong Kong Hungary Iceland
India Indonesia Ireland Israel Italy Ivory Coast
Japan Kazakhstan Kenya Kyrgyzstan Latvia Lithuania
Macedonia Madagascar Malta Mexico Micronesia Netherlands
New Zealand Norway Pakistan Peru Philippines Poland
Legend
World Star country
Portugal Rep of Congo Romania Russia Saudi Arabia Serbia
experience
Slovakia Slovenia South Africa South Korea Spain Sweden Taiwan Tajikistan Tanzania Turkey Ukraine UK UAE United States Venezuela
8
World Star Believes Its Aircraft Mgmt. Platform Mitigates Conflicts of Interest
World Star’s business focuses on managing joint venture vehicles for third party equity investors with each
investment vehicle targeting different strategic initiatives based on pre-defined parameters
Illustrative example
World Star’s Aircraft Management Platform Illustrative example
Mandate Mandate Mandate
Strategic initiative in Strategic initiative in Strategic initiative in
part-out late-life mid-life aircraft stub leases with low
aircraft (SPRITE Holdings) residual values
Joint Venture 1 Joint Venture 2 Joint Venture 3
(Investor 1) Owned by Oaktree (Investor 3)
World Star believes the nature of its business across various joint venture vehicles with different
investment objectives coupled with the boutique culture of the firm mitigates risk of bias for
aircraft during sales / re leasing
9
World Star Strategy – Experts in the Mid-to Late-Life Aircraft Market
World Star has focused on mid-life to mature end-of-life aircraft, as historically, this is where their hands-on
approach has extracted the most value for their managed equity vehicles
Silo 1 Silo 2 Silo 3
Mid Life Assets on Lease to Tier 1/2
New Aircraft on Lease to Tier 1 Carrier Mature Assets/Part-outs
Carrier
Aircraft Age 0-3 years 4-15 years 15-25 years
Lease Tenure 10-14 years 5-10 years 3-5 years
Credit Tier 1 International Airlines Tier 1 / 2 credits Credit quality can vary
Widely Available Transactions can have debt in place
Debt LTVs of 60-80% Harder to originate new debt Most transactions are unlevered
Fully amortising during lease period Potential balloon
Focus on liquidity Focus on liquidity
Focus on liquidity
Assets Widebodies: A330, B777-300ER Single aircraft or multiple asset
Previous generation models
Narrowbodies: B737-800, A320 portfolios
Lease extension with lessee
Potential to sell during lease
Re-lease to new lessee Re-lease
Lease extension with lessee
Realising Value Convert to freighter. Convert to freighter
Re-lease to new lessee
Part out Part out
Sell asset on lease return
Sell asset on lease return
Long term lease Shorter term stub lease remaining Asset management key
Strong quality credits Multiple possibilities to realise investor Shorter term transaction
Overview
Stable cash yields value
Higher return, more likely to be back
Possible exits mid way through lease Less competitive niche in market ended
Example
Targeted Market
Returns (IRR)
7 - 10% 10 - 15% 15 - 25%
10Summary of the Contracted World Star Fleet(1)
Fleet Distribution Fleet Characteristics (% Total Fleet)(1)
Fleet Distribution by Age (% Total Fleet)(1)
Notes:
1) Calculated by number of aircraft as of October 15, 2017 and includes the SPRITE 2017-1 portfolio 11Summary of Contracted World Star Fleet(1)
Fleet Distribution by Lessee Top 5 Lessees (by number of Aircraft)
Current Lessee Assets
1 Air Canada 3 18 Gol 3
2 Air China 3 19 Grand Cru Airlines 3
3 Air Cote d'lvoire 1 20 Hainan Airlines 1
4 Air France 1 21 IndiGo 2
5 Air Serbia 3 n/a Part‐Out (2) 3
6 Avion Express 1 22 Onur Air 1
7 Bhutan Airlines 1 23 Safair 1
8 Boliviana 4 24 Saudia 1
9 Brussels Airlines 4 25 Shenzhen 1
10 Canadian North 5 26 Small Planet 1
Fleet Lease Maturity Ladder
11 China Airlines 1 27 Sriwijaya Air 2 (% Total Fleet)
12 Croatia Airlines 2 28 Suparna Airlines 1 2028 3%
13 Emirates 1 29 Tame EP 1 2027 3% Average Remaining
Year of lease expiration 2025 2% Lease Term: 3.41
14 EVA Airways 1 30 TAP Portugal 4 2024 5%
15 Germania 4 31 Trans Air Congo 1 2023 8%
2022 13%
16 GetJet Airlines 2 32 Wizz 1 2021 11%
2020 17%
17 Go2Sky 1 33 Xiamen 1
2019 14%
Grand Total 66 2018 22%
2017 3% 6% No release ‐ Scrap/Sale
There is an additional A320-200 subject to an LOI
(dated 11/7/2017) with a Spanish lessee for a lease 3% No release ‐ Scrap/Sale
term of 72 months % Total Fleet
Notes:
1) Calculated by number of aircraft as of October 15, 2017 and includes the SPRITE 2017-1 portfolio 12
2) Part-Out = 2 X CFM56-5B and 1 CFM56-7BE enginesGeographic Diversity of Fleet(1)
Fleet Distribution by Region Fleet Distribution by Country
(% Total Assets) Country Number of Assets
1 Belgium 4
2 Bhutan 1
3 Bolivia 4
4 Brazil 3
5 Canada 8
6 China 7
7 Congo (Brazzaville) 1
8 Cote d'lvoire 1
9 Croatia 2
10 Ecuador 1
11 France 1
12 Germany 4
13 Hungary 1
14 India 2
15 Indonesia 2
16 Ireland 3
17 Lithuania 7
18 Poland 1
19 Portugal 4
20 Saudi Arabia 1
21 Serbia 3
22 Slovakia 1
23 South Africa 1
25 Taiwan 2
26 Turkey 1
28 UAE 1
Grand Total 67
Notes:
1) Calculated by number of aircraft as of October 15, 2017 and includes the SPRITE 2017-1 portfolio 13Section III: World Star Portfolio Management
14World Star’s Approach to Investment & Management
1- Investment Sourcing 2- Due Diligence & Investing
Leverage our network of: Analyse asset, lease and credit information
• Banks Obtain debt proposals
• Lessors / other investors Analyse the process risk and
• Airlines qualitative factors
Focus on selected aircraft families, and Determine target investment size and
market opportunities risk profile
Ensure focus on best quality assets Physical due diligence, contracts
and closing
Disciplined credit
and valuation
methodology,
backed by strong
risk controls
3- Management 4- Exit
Manage portfolio market risk, volatility Multiple exit alternatives
and concentration • As “flyers”
Monitor lease compliance and documentation, • Part-out
including maintenance work
• Refit
Collection, disbursements, insurance,
• Conversion to freighters
accounting and reporting
Lease / aircraft transition from operator
to operator
Technical audit / review
15Investment Sourcing - World Star Acquisition Sourcing
World Star’s relationships offer deep, global connections yielding consistent deal flow in addition to unique
servicing capabilities unavailable to some competitors
Capabilities Selected Counterparties
WSA leverages its network of banks, lessors / other
investors, and airlines
Indicative transactions
Portions of fleets of existing leasing companies
Often required to maintain 4-5 year average
fleet age; required to sell assets regularly
Aircraft owned by financial investors and / or banks
Aircraft owned and operated by carriers / sale and
leaseback
Arbitrage when taking over a contract for a new
aircraft from an airline that is in need of financing
Disciplined Approach Through the
Rationalization of distressed Aircraft-on-Ground
(“AOG”) or weak / defaulting credit situations in poor “Funnel”
cash flow / revenue contract
Wide-body and narrow-body aircraft that are suitable Opportunities 10 Top Reasons
for cargo conversion for Decline
On average, WSA reviews over 60 aircraft per month Rejected 6 Current
condition
Large portfolios under auction Soft Discussions 4 Lease terms
Tailor-made portfolios outside of structured sale
process Submit Bids 2 Lessee credit
Unrealistic price
Single / handful of aircraft Could Win 1 expectations
16Investment Sourcing - World Star Mgmt. Team Aviation Financing Experience
Management Team Financing Expertise, Since 1995(1)
Raised over $2.4bn of debt from structured financings, warehouses, private placements, commercial banks and seller financings(1)
Placed $720MM of interest rate hedging swaps
Structured, placed and monitored its own complex lessor contingent liability policy with Lloyds syndicates for over 20 years
Financial services competencies including the following:
Bank Revolving Credit Facility
International IPOs and Institutional Private Placements
Commercial Paper Conduit / warehouse facilities
Structured aircraft portfolio financings
Project Finance / Conversion Credit Facilities
Cross-Border Mergers & Acquisitions
Relationships with a Diversified Network of Lenders
Notes:
1) Not inclusive of the Sprite 2017-1 Limited transaction, but inclusive of management’s expertise / experience prior to World Star 17Due Diligence & Investing - World Star’s New Transaction Evaluation Criteria
For any new opportunity, World Star evaluates the transaction from 4 angles to generate a well-rounded decision:
Airline Quantitative and Qualitative Analysis
Financial analysis to determine health of balance sheet and any current/future cash flow difficulties
Combined with diligence on the airline to evaluate their strategy, fleet evolution, payment history (if current or not), strength of
management etc.
Market soundings through engagement with peer lessors and lenders
Asset Evaluation Lease Evaluation
Return condition analysis to ensure satisfactory value at Maintenance events and all projected cash flows
lease end
Aircraft utilization analysis to match projected maintenance
Current and future residual value projections events and costs
Exit opportunities at lease end – extension, place elsewhere, Oversight of aircraft insurances, ensuring compliance with
part-out local and international regulation
Qualitative assessment on marketability of the aircraft
Jurisdictional Risk
Analysis towards to recoverability of the aircraft in an enforced scenario, a “mortgage friendly” jurisdiction
Discussions with sovereign rating agencies and chambers of commerce
Local and Macro Economic Considerations
Health of the economies in which the airline operates, on local, regional and continental basis
18Management - Lease Management
Lease contracts are managed through diarized entries per aircraft/transaction to ensure all reporting obligations of
the lessee as well as World Star are met - All aircraft events (maintenance, insurance, operational updates etc) are
logged within the database, so a full timeline of the aircraft’s status is always available.
Reporting Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Example W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4
Rent Billing
Monthly Utilization
Reports
Maintenance Reserves
Invoicing
Annual Maintenance
Reserves Escalation
Annual Additional Rent /
Hour‐Cycle Adjustment
Eurocontrol Statements
Insurance & Reinsurance
Expiry Dates
Insurance & Reinsurance
Notice Dates
Airline Financial
(Within 180 days after the end of the financial year)
Statements
Technical Information
LLP Sheets & EGT Margins
Monthly report package
to Lessor
Quarterly report package
to Lessor
Annual Operating &
Aircraft Asset Expense
Budget
Review Quarterly Tech
Budgets
Periodic Meeting with
Airline
Invoices to Notices to Lessee Insurance &
Legend Lessee Reinsurance
Reports from Lessee Other statements Reports to Lessor Meetings
19Management - Technical Management
World Star’s full-service capabilities extend to all major technical aircraft management, maintenance and logistics
functions
Capabilities
Technical capabilities encompass the overseeing of maintenance, as well as management
WSA’s specialist expertise conducive to its mid-life to mature niche focus
Potential for technical overhauls, e.g. engine replacement, major airframe overhaul, shop visit avoidance
Experience of management team a source of competitive advantage over less experienced teams
Understanding of FAA/EASA regulations and requirements to move aircraft to new jurisdiction
Experience in major overhauls of aircraft and engines and developing the work scopes
Experience with maintenance, repair and operations (“MROs”) to agree costs for work scopes
Technical Capabilities Suite
Service and Maintenance Management
Understand European EASA and Mid-lease inspections Manage portfolio market risk, volatility and
United States FAA approvals to concentration
Management of storage and storage
manage aircraft airworthiness
maintenance Monitor lease compliance and
Range of aircraft management / documentation, including maintenance work
Implementation / management of pre-
inspection experience from regional
delivery maintenance Collection, disbursements, insurance,
aircraft to widebody aircraft
accounting, reporting
Capability to manage aircraft
Monthly monitoring of aircraft technical
airworthiness and maintenance Lease / aircraft transition from operator to
status
(including control of aircraft records) for operator
Pre-purchase inspections for weaker lessee credits
Technical audit / review
sale/leasebacks
20Management - Aviation Credit / Risk Management
World Star Aviation’s focus towards risk management is to identify, at the earliest possible stage, any potential
negative developments with regards to airline credit, aircraft value or portfolio performance
Airline Credit Risk Asset Risk
• Regular dialogue and face-to-face meetings • Using World Star’s proprietary model,
with the airline maintenance adjusted aircraft residual values
• Annual credit review - Audited yearly are projected
financial accounts are required per the lease • Values from independent appraisers are
agreements analyzed, with a “compare and contrast”
• Company is compared with appropriate approach
peers to benchmark performance • Qualitative market analysis is conducted in
• World Star has a weekly meeting to discuss house, with subscriptions to specialist
each and every asset aviation analytics companies
Portfolio Risk
• All of World Star’s aircraft are analyzed on a by-transaction and by-portfolio basis, with concentration by asset,
jurisdiction, lessee monitored
• The airline and asset risk reviews are amalgamated in the database, along with supplementary information and
commentary to provide a full picture of the status of each aircraft up to full portfolio level
21Management - Aviation Credit / Risk Management
World Star is a proactive company that seeks to manage potential situations before they arise
“Alarm” Signals That an Airline May be in Difficulty
Desktop sources: Other sources:
• Trade/business press • Route changes/cancellations
• Financial performance decline • Aircraft maintenance delays
• Peers outperforming airline • Key staff leaving the company
• Airline fleet utilization reduction • Suppliers and staff not being paid
• Political, economic and regulatory changes • Return of leased aircraft and slowed new
deliveries
The key is close communication with the airline and to assist them wherever possible.
It is mutually beneficial that aircraft are returned early instead of having to be repossessed.
22Exit - Investment Strategy
World Star has extensive experience in providing the optimum transaction exit solution for investors - Multiple exit
alternatives may maximize investor return through flexibility and opportunity
Strategies
World Star has extensive experience in providing optimal transaction exit solution for investors
The full coverage includes:
Lease extension with current operator
Reposition aircraft with a new operator
Aircraft sale
Conversion to freighter
Engine and airframe rebuild/restoration
Part-out
World Star’s strategy to increase optionality enables investors to mitigate effects of possible cyclicality (macro or
otherwise) and select the cashflow profile most appropriate at the time.
Freighter conversion experience
World Star has experience in all transaction exit paths, with particular experience in freighter conversions:
Not only single-aisle and narrowbody, but also widebody aircraft
Customers include leading airlines, cargo companies and overnight parcel carriers
World Star manages the conversion process and placement of the aircraft onto a new lease
23Section IV: SPRTE 2017-1
24SPRITE 2017-1: Portfolio Characteristics(1)(2)
Aircraft Model Country Breakdown Lessee Breakdown
21 aircraft fleet 15 lessees with no lessee concentration
The lessees are spread over 12 countries
(66% narrowbody / 34% widebody) higher than 14%
Brussels Airlines
SA/NV 2.9% Transportes Aéreos
Germania
Fluggesellschaft Portugueses, S.A.
A330-300 Portugal 1.3%
Germany 3.2% Belgium 2.9% Wizz Air Hungary
mbh 3.2% 1.3%
6.8% Hungary 3.2% Limited 3.2%
Shenzhen Airlines
Lithuania 3.8% Company Limited
EVA Airways
Corporation
Saudi Arabia 3.6%
14.0%
3.9% UAB Get Jet Airlines
A320-200 Taiwan 20.8% 3.8%
18.1% Saudi Arabian
737-800 Airlines Corporation Société
40.1% India 7.2% 3.9% Air France 13.6%
A319-100 Indonesia China 20.3% Xiamen Airlines 3.9%
7.4% 7.7% Air China Limited
12.9%
China Airlines
777-300ER Brazil 12.1% Limited 6.8%
27.7% GOL Linhas
France 13.6% InterGlobe Aviation
Aéreas S.A.
12.1%
Limited 7.2%
PT Sriwijaya
Air 7.7%
Year of Manufacture Region Breakdown Remaining Lease Term
The weighted average age of the The portfolio is spread over 3 regions, 41% The weighted average remaining lease term
fleet is 8.9 years of the portfolio represented by flag carriers of the fleet is 3.8 years
40.0% 30.0% 24.8% 25.7%
28.9% 23.5%
30.0% 23.5% 23.9% 20.0%
20.0% 15.6% 10.9%
Europe, Africa &
6.8% 10.0% 3.2% 4.2% 3.9% 3.7%
10.0% 1.3% Middle East (D)
Asia/Pacific (E) 31.9%
0.0% 0.0%
56.0%
Manufacture Year Lease Expiration Year
South/Central
America
12.1%
1) Unless otherwise noted, all percentages, values, averages, statistic and characteristics of the aircraft and portfolio in this presentation (i) use an October 15, 2017 reference date and (ii) are based on the average of
half-life base values of the aircraft determined as of June 30, 2017 by mba, AISI and BK, as adjusted for November 2017 projected maintenance status determined by Alton 25
2) The GetJet A320-200 listed above is no longer subject to an LOI with GetJet and is instead subject to an LOI (dated 11/7/2017) with a Spanish lessee for a lease term of 72 monthsSPRITE 2017-1: Portfolio Summary(1)
Initial
Age Flag Remaining Appraised
Aircraft Type Lessee Lessee Country 15 Lessees
Years Carrier (2) Lease Term Value(1) 12 Countries
($MM) 41% are Flag
in 3 Regions
A319-100 8.4 Brussels Yes Belgium 3.4 20.4 Carriers(3)
A319-100 8.3 Germania No Germany 6.4 22.0
A319-100 18.6 TAP Yes Portugal 4.0 8.7
Top 3 Lessees:
A320-200 9.6 Wizz No Hungary 1.4 22.5 Top Lessee
EVA Airways
Concentration
A320-200 7.5 Saudia Yes Saudi Arabia 0.5 26.8 Air France
Eva Airways
A320-200 7.3 IndiGo No India 2.7 22.5 Air China
14%
41%
A320-200 7.2 IndiGo No India 2.8 27.6
A320-200 9.9 GetJet No Lithuania 6.0 26.4
A330-300 11.2 China Airlines Yes Taiwan 1.2 47.1
B737-800 10 Gol No Brazil 6.0 26.9
B737-800 9.9 Gol No Brazil 6.1 30.6
B737-800 9.1 Gol No Brazil 6.9 26.4
B737-800 10.3 Shenzhen No China 3.2 24.6
B737-800 9.3 Sriwijaya Air No Indonesia 7.0 27.5
B737-800 9.2 XiamenAir No China 4.8 26.8
B737-800 7.3 Air China Yes China 0.6 29.0
B737-800 7.2 Air China Yes China 0.8 29.9
B737-800 7 Air China Yes China 1.0 30.4
B737-800 8.1 Sriwijaya Air No Indonesia 8.0 25.8
B777-300ER 9.2 EVA Airways No Taiwan 2.8 97.4
B777-300ER 8.5 Air France Yes France 5.6 94.6
8.9* 3.8* 694.0**
*Figures are weighted averages by initial asset value
**Figures are a sum of the above
1) Unless otherwise noted, all percentages, values, averages, statistic and characteristics of the aircraft and portfolio in this presentation (i) use an October 15, 2017 reference date and (ii) are based on the average of
half-life base values of the aircraft determined as of June 30, 2017 by mba, AISI and BK, as adjusted for November 2017 projected maintenance status determined by Alton. In addition, the portfolio description herein 26
reflects (i) an assumed lease of MSN 3293 (which was off lease as of October 15, 2017) based on the terms of a letter of intent with the identified lessee in place as of October 15, 2017 and (ii) the assumed delivery
to the lessee in December 2017 under the lease of MSN 36816, which was, as of October 15, 2017 expected to be re-delivered in November 2017 under a lease not described herein
2) Defined as fully or partially government or state-ownedManagement Case / Assumptions
Asset Initial Lease AOG Period Follow-on Lease / Sale Assumptions Retirement Period
MSN DOM Aircraft Engine Lessee Start End Start End Sale/Retirement Date
979 Mar-99 A319-100 CFM56-5B5/P TAP 99-Mar 21-Sep N/A N/A N/A 21-Oct 1 mths No FOL Assumed
4273 May-10 A320-200 CFM56-5B4/3 Saudia 10-May 18-May 3 mths 18-Aug 24-Aug 24-Sep 1 mths 6Yr FOL Multiple LOIs in negotiation with European operators / Asia operators
36802 Jul-10 B737-800 CFM56-7B26/3 Air China 10-Jul 18-Jul 3 mths 18-Oct 24-Oct 24-Nov 1 mths 6yr FOL Assumed
36547 Jun-10 B737-800 CFM56-7B26/3 Air China 10-Jun 18-Jun(3) 3 mths 18-Nov 24-Nov 24-Dec 1 mths 6yr FOL Assumed
37886 Oct-10 B737-800 CFM56-7B26/3 Air China 10-Oct 18-Oct EXTENSION 18-Oct 24-Oct 24-Nov 1 mths Extension from 10/17/2018 for 72mths to 10/17/2024 assumed
769 Jul-06 A330-300 CF6-80E1A4 China Airlines 08-Dec 18-Dec EXTENSION 18-Dec 24-Dec 25-Jan 1 mths Extension from 12/18/2018 for 72mths to 12/18/2024 assumed
3430 Mar-08 A320-200 V2527-A5 Wizz 08-Mar 19-Mar 3 mths 19-Jun 25-Jun 25-Jul 1 mths 6yr FOL Assumed
4328 Jun-10 A320-200 V2527-A5 IndiGo 10-Jun 20-Jun 3 mths 20-Sep 26-Sep 26-Oct 1 mths 6yr FOL Assumed
33755 Jul-08 B777-300ER GE90-115BL EVA Airways 08-Jul 20-Jul 3 mths 20-Oct 26-Oct 26-Nov 1 mths 6yr FOL Assumed
4384 Aug-10 A320-200 V2527-A5 IndiGo 10-Aug 20-Aug 3 mths 20-Nov 26-Nov 26-Dec 1 mths 6yr FOL Assumed
35215 Jun-07 B737-800 CFM56-7B26/3 Shenzhen 07-Jun 20-Dec 3 mths 21-Mar 27-Mar 27-Apr 1 mths 6yr FOL Assumed
3895 May-09 A319-100 CFM56-5B6/3 Brussels 15-Mar 21-Mar EXTENSION 21-Mar 27-Mar 27-Apr 1 mths Extension from 03/31/2021 for 72 mths to 03/31/2027 assumed
35631 Aug-08 B737-800 CFM56-7B26/3 XiamenAir 08-Aug 22-Aug 3 mths 22-Nov 28-Nov 28-Dec 1 mths 6yr FOL Assumed
35543 Apr-09 B777-300ER GE90-115B Air France 09-May 23-May N/A N/A N/A 23-Jun 1 mths No FOL Assumed
34270 Oct-07 B737-800 CFM56-7B27/3B1 Gol 07-Oct 23-Oct 3 mths 24-Jan 30-Jan 30-Feb 1 mths 6yr FOL Assumed
3293 Nov-07 A320-200 CFM56-5B4/3 GetJet(1) 17-Nov 23-Nov 3 mths 24-Feb 30-Feb 30-Mar 1 mths 6yr FOL Assumed
34272 Nov-07 B737-800 CFM56-7B27/3B1 Gol 07-Nov 23-Nov 3 mths 24-Feb 30-Feb 30-Mar 1 mths 6yr FOL Assumed
3950 Jun-09 A319-100 CFM56-5B6/3 Germania 17-Sep 24-Feb N/A N/A N/A 24-Mar 1 mths No FOL Assumed
35066 Aug-08 B737-800 CFM56-7B27/3B1 Gol 08-Aug 24-Aug 3 mths 24-Nov 30-Nov 30-Dec 1 mths 6yr FOL Assumed
35226 Jun-08 B737-800 CFM56-7B26/3 Sriwijaya Air 16-Oct 24-Oct 3 mths 25-Jan 31-Jan 31-Feb 1 mths 6yr FOL Assumed
36816 Sep-09 B737-800 CFM56-7B26/3 Sriwijaya Air(2) 17-Dec 25-Dec N/A NA NA 26-Jan 1 mths No FOL Assumed
Age at 1st
MSN A/C Lessee Lease Expiration 2H 2017 1H 2018 2H 2018 1H 2019 2H 2019 1H 2020 2H 2020 1H 2021 2H 2021 1H 2022 2H 2022 1H 2023 2H 2023 1H 2024 2H 2024 1H 2025
Re Lease
979 A319-100 TAP 21-Sep 23 SOLD
4273 A320-200 Saudia 18-May 8 FOL SOLD
36802 B737-800 Air China 18-Jul 8 FOL SOLD
36547 B737-800 Air China 18-Jun(3) 8 Extension FOL SOLD
37886 B737-800 Air China 18-Oct 8 Extension SOLD
769 A330-300 China Airlines 18-Dec 12 Extension SOLD
3430 A320-200 Wizz 19-Mar 11 FOL
4328 A320-200 IndiGo 20-Jun 10 FOL
33755 B777-300ER EVA Airways 20-Jul 12 FOL
4384 A320-200 IndiGo 20-Aug 10 FOL
35215 B737-800 Shenzhen 20-Dec 13 FOL
3895 A319-100 Brussels 21-Mar 12 Extension
35631 B737-800 XiamenAir 22-Aug 14 FOL
35543 B777-300ER Air France 23-May 14 SOLD
34270 B737-800 Gol 23-Oct 16 FOL
3293 A320-200 GetJet 23-Nov 16 FOL
34272 B737-800 Gol 23-Nov 16 FOL
3950 A319-100 Germania 24-Feb 15 SOLD
35066 B737-800 Gol 24-Aug 16 FOL
35226 B737-800 Sriwijaya Air 24-Oct 16 FOL
36816 B737-800 Sriwijaya Air 25-Dec 16
Source: World Star
1) Lease terms described herein are assumed based on the terms of a letter of intent with GetJet and an assumed delivery to lessee in November 2017 27
2) Based on assumed delivery to lessee in December 2017
3) 75-day lease extension after this date followed by the 3-month remarketing period shown in the following columnMizuho Team ABS Credentials
Aviation ABS
November 2017 April 2017 Dec 2016 Nov 2016 June 2015 Feb 2015 Dec 2014
SPRTE 2017-1 TBOLT 2017-1 LAFL 2016-1 BBIRD 2016-1 ECAF 2015-1 DCAL 2015-1 Eagle 2015-1
Aircraft Lease Aircraft Portfolio Sale Aircraft Portfolio Sale Aircraft Lease Aircraft Portfolio Sale Aircraft Portfolio Sale Aircraft Lease
Securitization Debt & Equity Debt & Equity Securitization Debt & Equity Debt and Equity Securitization
$585MM $436MM $928MM $800MM $1,573MM $814MM $381MM
Global Coordinator
Left Lead Structuring Joint Lead Structuring Sole Structuring Joint Lead Structuring Sole Structuring Sole Structuring
Left Lead Bookrunner Joint Lead Bookrunner Sole Bookrunner Joint Lead Bookrunner Joint Bookrunner* Lead Bookrunner* Lead Bookrunner*
Container ABS
Nov 2014 Oct 2013 Sept 2013 Jan 2013 August 2017 Jan 2015 Nov 2014
GAFS 2014-1 FAN 2013-1 EAFL 2013-1 AABS 2013-1 TCF 2017-2 GCA 2015-1 DFCF 2014-1
Aircraft Lease Aircraft Engine Aircraft Lease Aircraft Lease Container Lease Container Portfolio Container Lease
Securitization Securitization Securitization Securitization Securitization Sale Debt & Equity Securitization
$602MM $170MM $636MM $650MM $450MM $434MM $159MM
Sole Financial Advisor Sole Structuring Sole Structuring Sole Structuring Sole Structuring
Sole Arranger* Sole Bookrunner* Joint Bookrunner* Joint Bookrunner* Joint Bookrunner Sole Bookrunner* Sole Bookrunner*
Telecom LatAM ABS
May 2014 October 2016 2017 Peru June 2016 Mexico 2015 Peru 2014 Brazil 2014 Peru
TAL 2014-2 Line One Abengoa
Sprint Spectrum CPAO Purchaser Poinsettia GyM Ferrovias Rio Previdencia Transmision Sur
Container Lease
Securitization
3.360% Notes 2023 Structured Loan & WCF Sale and Lease Back Urban Rail Project Bond Oil & Gas Royalties Power Transmission
$238MM
Spectrum backed Notes $316MM & $80MM Securitization PEN 629,000,000 US $3.2BN Bond
$3,500MM Sole Structuring US$ 530,800,000 & BRL 2.4BN US$432MM
Sole Structuring
Sole Bookrunner Sole Structuring Joint Structuring Joint Structuring
Lead Bookrunner* Joint Lead Structuring
Joint MLA Joint Bookrunner Sole Bookrunner* Joint Bookrunner* Joint Bookrunner*
Joint Lead Bookrunner
* These transactions were structured and executed by the SCG team during their tenure at BNP Paribas
28Mizuho Team – The Leader in Aircraft Portfolio Sales
Since January 2013, the following ABS Equity Note Processes have been successfully consummated
Aviation ABS Equity Note Transactions (Mizuho has led more ABS equity portfolio sales than any other bank)
1. AABS - 2013 GECAS aircraft portfolio ;
2. RISE - 2014 GECAS aircraft portfolio; Aircraft Portfolio
3. GAFS – 2014 GAP aircraft portfolio Sale Rankings
4. BBIRD – 2014 ALC aircraft portfolio
5. DCAL – 2015 DVB aircraft portfolio Total Equity
Institution Placements
6. ECAF – 2015 BBAM portfolio
Mizuho Team 6
7. DHAL – 2015 AWAS aircraft portfolio
GS 3
8. SAIL – 2015 BOC aircraft portfolio
Macquarie 2
9. LAFL – 2016 GECAS portfolio
BAML 1
10. DAE – 2016 Dubai Aerospace aircraft portfolio
Citi 1
11. TBOLT – 2017 ALC portfolio
Element 1
Portfolio Sale to Financial Investors / Lessor with Transfer of Servicing Responsibilities
Pressprich 1
12. GFL – 2014 Aercap portfolio
Wells 1
13. KDAC – 2016 Aercap portfolio
14. MRLN – 2016 ACG Portfolio
15. PINOT – 2017 ACG engages in portfolio sale process (Mizuho selected as sole advisor)
The Mizuho SCG team successfully executed the GFL, GAFS, BBIRD, DCAL, LAFL and TBOLT sales
Typical of the cross asset / investor pollination strategy, Mizuho’s SCG team also successfully closed the first ever container portfolio
sale with an ABS E-Note
POLARIS – 2015 Buss container portfolio
Mizuho SCG team identified a syndicate of E-Note parties on ALC’s TBOLT transaction including all investors in the first round
Mizuho’s SCG team has established strong credentials both domestically in the US market as well as globally in running tight E-Note
processes with a 100% conversion rate consistently achieving market-clearing purchase prices
Mizuho’s SCG team is the ONLY team that has stayed intact since 2013 and engages the various E-Note buyer accounts (over 175
domestic US names and over 70 foreign investors) through the global Mizuho sales force
In addition, Mizuho’s SCG team leverages its own relationships cultivated via the successful execution of multiple E-Note processes
29Recent Recognition & Awards Won by Mizuho Team Members
Capital Markets Deal
Overall Deal of the Year of the Year
Blackbird (2016) 2013 Americas Deal of Most Innovative Engine Aircraft Lessor Finance
Thunderbolt (2017)
the Year ABS since 2008 Deal of the Year 2013
AABS 2013-1 FAN 2013-1 AABS 2013-1
Overall Debt Deal of the Year Editor’s Deal of the Year
Sprite (2017) Labrador (2016)
Americas Editor's
Award for Innovation
Mizuho Securities (2017)
Best Americas Deal of
Editor’s Deal of the Year the Year
Labrador (2016) Labrador (2016) Europe Deal of the year
Best Securitization Securitization Deal of the
2013
House 2013 Year 2013
Deal of the Year EMERALD 2013-1
Overall Deal of the Year DFCF 2013-1 GCA 2013-1
Blackbird (2016) Blackbird (2016) DFCF 2013-1
Financing Innovation Structured Financing
of the Year of the Year Infrastructure & Project Finance Project Bond Latin America Offshore Best Infrastructure
Deal of the Year in the Americas Deal of the Year Drilling Deal of the Year Financing, Central America
Rio Oil Finance Trust Rio Oil Finance Trust
Odebrecht Offshore Drilling Odebrecht Offshore Drilling Odebrecht Offshore Drilling Reventazon Finance Trust
US$ 4,200,000,000+ US$ 4,200,000,000+
US$ 1,690,000,000 US$ 1,690,000,000 US$ 1,690,000,000 US$ 135,000,000
Oil & Gas Royalties Oil & Gas Royalties
Securitization Program Securitization Program Drilling Rig Bond Drilling Rig Bond Drilling Rig Bond Hydropower IDB-B Bond
30SPRITE 2017-1: Structure Highlights
Greater of 1.50% of rents due & $2,500, plus;
Servicer Fees Greater of 1.50% of rents collected & $2,500;
Senior 1.50% and sub 0.50% of gross disposition & excess proceeds
9 months of interest on Series A & B - Covers interest on the Notes,
Liquidity
senior hedge payments, if any, and required expenses. Scales down as
Facility the outstanding notes amortize
Note The Series A & B amortize straight-line over 13 years up to and
including the expected final payment date and straight-line over 4
Amortization years after the expected final payment date | the Series C notes
Schedule amortize based on a 7 years to zero schedule(3)
Expected
If the Notes remain outstanding after year 7, the transaction will sweep
Final Payment all residual cash flow to pay down the Series A, B and C
Date
Step-Up If the notes remain outstanding after year 7, pricing on the Series A &
Coupon B will step up by 200bps
$10MM Initially funded from transaction proceeds (Excess maintenance reserve fund above the required amount cannot be released for the first 12
Maintenance
months of the transaction) | On-going required amount is based on 12 month look-forward mechanism and minimum reserve amount of $1MM – the
Reserve maintenance forecast that drives on going look-forward mechanism is updated annually by World Star and verified by Alton
DSCR Test Calculated on a trailing 6 month basis - A DSCR below 1.20x results in a cash trap event until cured for three consecutive payment dates
Early
A DSCR below 1.15x or utilization during any period falls below 75% of the aircraft remaining in the pool (by count) will result in a full cash sweep –
Amortization full cash sweep will end once DSCR / utilization threshold has been cured for 3 consecutive payment dates
Events
Permitted dispositions of aircraft resulting in up to 25% of principal prepayments allowed in years 0-2 and 50% allowed until year 4; any principal
Prepayment prepayment outside of permitted dispositions will have a makewhole of T+50bps; no makewhole upon asset dispositions after year 4 (more call
protection for debt investors compared to tiered concepts in recent mid-life transactions)
The cash portion of security deposits ($9.2MM as of August 31, 2017) will be available as an additional source of liquidity to be used for the benefit of
Security
senior debt holders (must be used to cover top-of-the-waterfall expenses, senior note interest and liquidity facility repayment) and may be used to
Deposits cover principal payments at the discretion of the equity holder
Additional Prior to the anticipated repayment date, if any end of lease payments are not reinvested in the aircraft or credited to a lessee or purchaser, a pro rata
Protections portion of up to 105% of the allocable debt balance relating to such end of lease payment will be payable
1) Based on the average of half-life base values of the aircraft determined as of June 30, 2017 by morten, beyer & agnew Inc. (“mba”), Aircraft Information Services, Inc. (“AISI”) and BK
Associates, Inc. (“BK”), as adjusted for November 2017 projected maintenance status determined by Alton 31
2) 13 year straight line for 7 years and then 4 years straight line thereafter. No amortization will be payable on the first payment date for Series B & C
3) 7 years straight line except that the remaining principal of the Series C will be targeted for payment on the ARD. No amortization will be payable on the first payment date for Series CSPRITE 2017-1: Structure & Execution Timeline
Execution Highlights
The transaction represents the fastest aircraft ABS execution seen in the US capital markets (7
days in total) – 4 days of pre-marketing and 3 days of formal announcement to pricing
Key documentation including the offering memorandum were drafted and completed in a 2.5 Priced the
week period – a record for aircraft ABS transactions
November 17th
Transaction
US Roadshow (5 Days) & Roadshow:
Subsequent Formal Announcement November 8th – 14th In the market for
Announcement: 7 business
November 15th days from
announcement
Finalize Preliminary to pricing
Offering Memorandum & November 8th
Begin Premarketing
Finalized offering document and ancillary documentation
necessary to launch transaction in 12 days
Finalized Term
October 26th
Sheet / Structure
Non Deal Roadshow Execution Overview
(Miami ABS Conference
Transaction entered pre-marketing on November 8, comprising
& NY/NE Additional September 18th (Miami) & a deal roadshow across the West Coast, NY/New England and
Meetings) October 13th (NY / NE) Mid-West
After announcement on November 15, the transaction attracted
90+ investors globally with IOIs from 27 investors across the
US, Europe, Asia and Australia with multiple new aircraft ABS
Rating Agency investors
Due Diligence IPT of mid/low 4s @ 2.1x oversubscription | low 6s @ 1.5x
oversubscription | low 7s @ 2.7x oversubscription
Meetings at September 11th – 13th
World Star The final orderbook represents one of the most widely
distributed aircraft ABS financings to-date
Offices
32SPRITE 2017-1: Structural Summary
SPRITE 2017-1: A 144A / Reg S Aircraft Structured Portfolio Offering of $585MM to Finance a Portfolio of 21 In-Demand Commercial Aircraft
Servicer World Star Aviation (UK) Limited (“World Star” or “WSA”)
Sprite 2017-1 Limited (“SPRITE Cayman”), a bankruptcy remote SPV incorporated under Cayman law and resident of Ireland for tax purposes
Issuers Sprite 2017-1 US LLC (“SPRITE US”), a limited liability company organized under the laws of Delaware and wholly owned sub of SPRITE Cayman
Sprite Aviation Holdings Designated Activity Company (“Sprite Holdings”) is a joint venture vehicle established between Oaktree Capital Management
(UK) LLP (“Oaktree”) and World Star with the mandate to acquire mid-life aircraft
Transaction
Background Sprite Holdings & SPRITE 2017-1 accumulated assets from the acquisition of an 18 aircraft portfolio and other opportunistic bilateral acquisitions
The transaction financed the 18 aircraft portfolio plus 3 additional aircraft purchased on a bilateral basis
Notes Series A Series B Series C
Size ($MM) 457 88 40
Rating
Asf / Asf BBBsf / BBBsf BBsf / BB-sf
(S&P / Kroll)
LTV(1) 65.9% 78.5% 84.3%
Yield 4.375% 6.250% 7.000%
Spread (over m/s) 226bps 413bps 497bps
13 Year Straight Line ( 7 years) / 13 Year Straight Line ( 7 years) /
Scheduled Amortization 7 Year Straight Line(3)
4 Year Straight Line Thereafter(2) 4 Year Straight Line Thereafter(2)
Key Terms
Expected Wtd. Average Life 5.0 Years 5.0 Years 3.6 Years
Expected Final (“ARD”) 7.0 Years 7.0 Years 7.0 Years
Legal Final Maturity 20 Years 20 Years 20 Years
Format of Offering 144A / Reg S Notes
Use of Proceeds To finance a portfolio of 21 aircraft to be owned by SPRITE Cayman and serviced by World Star
Global Coordinator, Left Lead
Structuring Agent & Left Lead Mizuho Securities USA LLC (“Mizuho”)
Bookrunner
Liquidity Facility Sized based on 9 months of interest on the Series A & B notes (provided by DVB Bank SE, London Branch)
1) Based on the average of half-life base values of the aircraft determined as of June 30, 2017 by morten, beyer & agnew Inc. (“mba”), Aircraft Information Services, Inc. (“AISI”) and BK
Associates, Inc. (“BK”), as adjusted for November 2017 projected maintenance status determined by Alton 33
2) 13 year straight line for 7 years and then 4 years straight line thereafter. No amortization will be payable on the first payment date for Series B
3) 7 years straight line except that the remaining principal of the Series C will be targeted for payment on the ARD. No amortization will be payable on the first payment date for Series CSPRITE 2017-1: Awards
Overall Debt Deal of the Year
Sprite (2017)
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