American Conference Institute’s Forum on

Aircraft Finance & Leasing

Identifying and Obtaining New Sources of Financing and Ensuring a Competitive Advantage in an Evolving Market

Tuesday, February 22 to Wednesday, February 23, 2011
FLATOTEL, New York, NY

Day One: Tuesday, February 22, 2011

9:30 Registration and Continental Breakfast

10:10 Co-Chairs’ Opening Remarks

Steven I. Chung
Partner, Transportation Finance Group
Hughes Hubbard & Reed LLP
(Washington, DC)

Marc D. Latman
Partner
Fulbright & Jaworski L.L.P.
(New York, NY)

10:15 Market Outlook for 2011 and Beyond: Capital Markets, EETCs, PDP Financing, Aircraft Valuations, Emerging Markets, and More

Wolfgang Arbaczewski
SVP, Head of Structuring & Analysis Transportation
Americas
HSH Nordbank
(New York, NY)

Stella V. Belvisi
Senior Counsel
Airbus Americas, Inc.
(Herndon, VA)

Chris Chaput
Managing Director
RPK Capital Partners
(Chicago, IL)

George S. Kim
Director
Citigroup
(New York, NY)

John Wikoff
Vice President
Goldman Sachs
(New York, NY)
Moderator:

Steven I. Chung
Partner
Transportation Finance Group
Hughes Hubbard & Reed LLP
(Washington, DC)

  • Assessing the short- and long-term availability of capital markets financing
  • Evaluating the appetite of the capital markets for Ex-Im Bank-guaranteed notes
  • Identifying and obtaining new sources of financing
  • Analysis of financing deals that have been completed recently
  • Evaluating the costs and benefits of new EETC financing structures and the challenges involved with unwinding them
  • Potential for a funding gap in 2011
  • Obtaining accurate aircraft valuations in an uncertain market
    • Risks of relying on current valuations of existing aircraft
    • Impact of current valuations on deal structures
  • Effects of industry consolidation on aircraft finance
  • Trend towards using operating leases instead of financing leases
    • FASB proposed accounting change
  • Renegotiating financing deals in light of current economic realities
  • Availability of PDP financing
    • Necessity of long-term financing
      • Difficulties in obtaining long-term financing
    • Export Credit Agency involvement?
  • Outlook for the future of aircraft ABS deals
  • The expected impact of Basel III on aircraft financing
  • Analysis of financing deals that have been completed recently in emerging markets
    • How they compare to other financing structures

11:45 Lessors’ Roundtable: Perspectives on Obtaining Financing, the Role of Private Equity, New Entrants Into the Market, and the Potential for Growth

Pradeep P. Hathiramani
Principal
Kohlberg Kravis Roberts & Co.
(San Francisco, CA)

Evelyn S. Havasi
Global Head - Asset Finance Group
Citigroup Global Markets, Inc.
(New York, NY)

Nicolas P. Stable
Vice President & Counsel
GE Capital Aviation Services
(Stamford, CT)
Moderator:

Edward P. Christian
Senior Counsel
Akin Gump Strauss Hauer & Feld LLP
(New York, NY)

  • How lessors are obtaining financing
    • Capital markets
      • Access to senior debt
    • Export/import financing
    • Can lessors still obtain financing based on a parent company’s credit rating?
  • Impact of private equity on lessors
  • Assessing the growth prospects for lessors
    • Where are the new opportunities for growth?
    • Likelihood that lessors will have to sell off some of their portfolio
  • How big is the leasing market going to become?
  • Preparing for the impact of new and emerging lessors on existing lessors and the market as a whole
    • Where new lessors are coming from
  • Challenges facing start-up lessors in the current environment
    • Lessons learned from those that have succeeded
    • Working with established lessors
  • Lessor perspectives on new and emerging manufacturers
    • Implications for existing manufacturers
    • What manufacturers must do to remain competitive in the face of new market entrants
  • Obtaining refinancing in the current market
    • What happens if a lessor is unable to refinance?

1:15 Networking Luncheon for Speakers and Delegates

2:15 Ensuring Compliance With and Responding to a Changing Legislative and Regulatory Landscape: The Cape Town Convention, the New FAA Registration Requirement, FASB Accounting Changes, and More

Robert M. Peregrin
Shareholder
Daugherty, Fowler, Peregrin, Haught & Jenson
(Oklahoma City, OK)

Marc D. Latman
Partner
Fulbright & Jaworski L.L.P.
(New York, NY)

Erin M. Van Laanen
Shareholder
McAfee & Taft
(Oklahoma City, OK)

  • Complying with the new FAA registration requirement
    • Ensuring proper registration
    • Impact on the industry
    • Expected costs associated with having to reregister a large number of aircraft
  • Evaluating the FASB proposed accounting change and the impact that it would have on aircraft financing and leasing
    • Determining what must be moved onto balance sheets
    • Impact on debt calculations
  • The Cape Town Convention and its impact on aircraft financing and repossession
    • How has the Cape Town Convention played out?
    • Is it a substitute for Section 1110 as interpreted by the courts?
    • Mexicana Airlines bankruptcy
    • Update on which countries are participating
  • Preparing for the impact that the Dodd-Frank Act will have on aircraft finance
  • Evaluating the impact that new aircraft emissions standards in the EU would have on aircraft traveling to and from Europe
  • Ensuring that, when necessary, aircraft leases comply with the execution procedures and signing arrangements required for English law documents to remain enforceable in the wake of the Mercury Tax Group case

3:45 Afternoon Refreshment Break

4:00 Bankruptcy Considerations: Accounting for the Impact of Mexicana Airlines, Chapter 15 Filings, and Other Recent Bankruptcy Cases on Aircraft Finance

F. Scott Wilson
Associate General Counsel
Pratt & Whitney
(East Hartford, CT)

George K. Miller
Partner
Mayer Brown LLP
(New York, NY)

  • Managing the fallout from the Mexicana Airlines bankruptcy and its effects on the industry
  • Chapter 15 bankruptcies and their impact on aircraft finance and leasing
  • Drafting and negotiating deal documents in light of recent bankruptcy cases
  • Bankruptcy rights and intercreditor agreements
    • Second lien lenders
    • Other lenders

5:00 Conference Adjourns

Day Two: Wednesday, February 23, 2011

8:30 Continental Breakfast

9:00 Co-Chairs’ Remarks

9:05 Carrier Roundtable: Insider Views on Industry Expectations, Accessing the Capital Markets, Export Credit Agencies, and Re-Engining

Gordon Famariss
Senior Principal, Corporate Finance
American Airlines, Inc.
(Fort Worth, TX)

Adam Schless
Director, Aircraft Transactions & International Counsel
JetBlue Airways Corporation
(Forest Hills, NY)

Michael W. Smith
Partner
White & Case LLP
(New York, NY)

  • How carriers view the aircraft finance and leasing market for 2011 and beyond
    • Projected carrier fleet requirements
  • Ability of carriers to access senior debt in the capital markets
  • How low-cost airlines are affecting the industry
  • Carrier perspectives on Export Credit Agencies
  • Achieving profitability going forward
  • Carrier views on the question of re-engining
  • Overcoming the environmental challenges facing airlines

10:20 Morning Coffee Break

10:35 Private Equity and Aircraft Finance: Key Considerations for Investors, Lessees, and Lessors

James Raff
Founder and President
RPK Capital Partners
(Chicago, IL)
Moderator:

Emily C. DiStefano
Counsel
Debevoise & Plimpton LLP
(New York, NY)

  • How private equity fits into the overall aircraft finance picture
    • Capacity limits of private equity
    • Who will soak up the excess capacity?
  • Long-term prospects for the role of private equity in aircraft finance
    • Remaining profitable over time
    • Obtaining and holding onto the right mix of people
  • Assessing private equity funding as compared to funding from other sources
  • Private equity expectations regarding rates of return
    • Satisfying investors’ expectations
  • Determining whether to finance exclusively with equity

11:50 Networking Luncheon for Speakers and Delegates

1:00 Export Credit Agencies: The Evolving Role of ECAs in Aircraft Finance and Their Impact on the Industry Going Forward

Louis E. Emery
Senior Structured Finance Counsel
Office of the General Counsel
Export-Import Bank of the U.S. (Washington, DC)

Marcio Nobre Migon
Head of Department
Aircraft Financing - Export Credit Division
Banco Nacional de Desenvolvimento Econômico e Social
(BNDES) (Rio de Janeiro, Brazil)

Rae Ann Capps McKeating
Assistant Vice President, Legal
Aviation Capital Group Corp.
(Newport Beach, CA)

Marc Meloche
Sr. Director - Group Head
Structured Finance
Bombardier Aerospace
(Dorval, Quebec)
Boeing Capital Corporation - speaker to be announced

Dean N. Gerber
Shareholder and Chair
Equipment Finance Group
Vedder Price P.C.
(Chicago, IL)

  • Exploring the dynamic between aircraft manufacturers and ECAs
    • How ECAs affect competition among manufacturers
    • How various ECAs support aircraft manufactured in specific countries
  • Obtaining Ex-Im Bank approval
  • Evaluating how long Ex-Im Bank and other ECAs will be able to fill the financing void left by the capital markets
    • Where will refinancing come from?
  • Analyzing the dynamic among Ex-Im Bank, Export Development Canada, Latin American ECAs, and European ECAs
  • Outlook for the home market rule in light of recent tightening in the capital markets
  • Impact of recent Air China aircraft financing supported by European ECAs

2:30 Afternoon Refreshment Break

2:40 Financing Used Aircraft in an Uncertain Market

Rob DiPaolo
Director
Tennenbaum Capital Partners, LLC
(Santa Monica, CA)

Robert C. Gates
Managing Director
RPK Capital Partners
(Chicago, IL)

Gary A. Lew
Principal
Vx Capital Partners
(San Francisco, CA)

Rudolph F. Tenore
Managing Director
Asset Sales
Banc of America Leasing
(Providence, RI)

Mark N. Lessard
Partner
Pillsbury Winthrop Shaw Pittman LLP
(New York, NY)

  • Assessing the current status of used aircraft financing
  • Overcoming the challenges of buying and selling used aircraft in the current market
  • Obtaining financing for used aircraft
    • Capital markets
    • Private equity
  • New and emerging sources of financing for used aircraft
  • Preparing for the impact that re-engining will have on the market for existing aircraft
    • How aircraft values will be affected by re-engining
  • Difficulties in estimating residual values

3:55 Negotiating and Drafting Secure and Comprehensive Aircraft Leases

Allen Huang
Associate General Counsel
Virgin America Inc.
(Burlingame, CA)

Scott H. Hankins
Counsel
Frost Brown Todd LLC
(Cincinnati, OH)

Donald B. Mitchell
Partner
Smith, Gambrell & Russell, LLP
(Atlanta, GA)

Ann H. Pollock
Partner
Skadden, Arps, Slate, Meagher & Flom LLP
(Chicago, IL)

  • Finance leases vs. operational leases
    • Key terms and conditions that distinguish one from the other
    • Ensuring that your lease is classified as you intend
  • Negotiating and drafting provisions for delayed redelivery
    • Delayed redeliveries that are beyond the lessee’s control
  • Types of damages to which lessor may be exposed upon a delayed redelivery
  • Best practices for drafting and negotiating maintenancerelated provisions
  • Maximizing the value of an engine through careful consideration of lease provisions
  • Determining what rights, if any, a lessee has to swap engines and including appropriate provisions in a lease
    • What happens when a lease is silent on this issue?
  • Making sure that you are protected: including appropriate indemnity and liability provisions in a lease

 5:15 Conference Ends