Welcome to Labrador Aviation Finance Reports

Labrador Aviation Finance Limited (“Labrador”) is a special-purpose Bermudan limited liability exempted company managed and controlled through its board of directors in Ireland. Labrador acquired an initial portfolio of twenty aircraft (the “Aircraft”) from GE Capital Aviation Services Limited, an Irish Company (“GECAS”), and certain of its affiliates. On the Closing Date, 15 December 2016, Labrador agreed to purchase from GECAS and such affiliates (collectively, the “Sellers”) twenty aircraft which were on operating leases with sixteen lessees based in fifteen countries.

Initial Portfolio

The initial portfolio consists of twenty aircraft, seventeen narrow-body aircraft and three wide-body aircraft, which were on operating leases with sixteen lessees based in fifteen countries. The initial appraised value of the Aircraft in the initial portfolio (the “Initial Appraised Value”) was $928,013,259, based on the average of the base values of the Aircraft determined in three appraisals, as adjusted for maintenance by Morten Beyer & Agnew, Inc.

Subsidiaries

Labrador owns five Irish companies, which will hold title to the Aircraft (the “Aircraft Owning Subsidiaries”); these will lease the Aircraft to individual Lessees. Labrador also owns a Norwegian company and a Swedish company to which some of the Aircraft Owning Subsidiaries will lease Aircraft owned by such Aircraft Owning Subsidiaries, and which in turn will lease the Aircraft to individual Lessees. This two-tier structure is designed to accommodate the tax or regulatory needs of certain Lessees. Such special purpose companies and any other special purpose companies or other entities formed by Labrador that will lease Aircraft from Labrador and sub-lease the Aircraft to Lessees are referred to as “Leasing Subsidiaries.”

Initial Notes and Certificates.

On the Closing Date, Labrador issued the Series A Notes in the initial principal amount of $603,000,000, the Series B Notes in the initial principal amount of $106,000,000 and the E Certificates in the amount of $250,000,000. The net proceeds of all of such Notes were used to fund in part the payment to GECAS of the purchase price of the Aircraft. The Series A Notes and the Series B Notes were issued pursuant to an Trust Indenture (the “Indenture”) among Labrador, Wells Fargo Bank, N.A., (“Wells Fargo”), as trustee (the “Trustee”) and as the operating bank, Phoenix American Financial Services, Inc as the managing agent (the “Managing Agent”) and Natixis S.A. as the Liquidity Servicer Provider (the “Liquidity Servicer Provider”). Each series of Notes has an expected amortization schedule and an expected final payment date as well as a final legal maturity date, specified below. Payments on the Series B Notes are subordinated to payments on the Series A Notes to the extent provided in the Indenture.

Collateral

To secure repayment of the Notes, Labrador pledged its rights, title and interests in the Aircraft to Wells Fargo, as Security Trustee (the “Security Trustee”), pursuant to a Security Trust Agreement (the “Security Trust Agreement”) among the Security Trustee, Labrador and its subsidiaries. (Each Aircraft Owning Subsidiary or Leasing Subsidiary formed or acquired in the future will become a party to the Security Trust Agreement.) Under the Security Trust Agreement, Labrador will pledge all of their other assets to the Security Trustee, including a security interest in the Aircraft owned by each Aircraft Owning Subsidiary and in the leases of such Aircraft and related assets and will cause the security interest in the Aircraft to be registered with the International Registry under the Cape Town Convention and an appropriate instrument evidencing such security interest to be filed with the central registry maintained by the Federal Aviation Administration (“FAA”). Except for such registration with the International Registry and the FAA, no other recordation or filing of the security interest in the Aircraft is contemplated. Each of the Aircraft Owning Subsidiary and the Leasing Subsidiaries will guarantee, on a limited recourse basis, the obligations of Labrador, including the repayment of the Notes.

The Managing Agent, acting on behalf of the Security Trustee, shall direct the Operating Bank (which may be the Trustee or the Security Trustee or as otherwise set forth below) in writing to establish and maintain on its books and records in the name of the Security Trustee (or in the name of the relevant Issuer Group Member but under the control of the Security Trustee) all of the following accounts: (i) a collections account relating to the Labrador Ireland Companies (the “Ireland Collections Account”) and a collections account relating to the Labrador USA Companies (the “USA Collections Account” and, collectively, the “Collections Accounts”), (ii) one or more rental accounts, if required (each, a “Rental Account”), (iii) an aircraft acquisition account (the “Aircraft Acquisition Account”), (iv) a liquidity reserve account for the Notes (the “Liquidity Facility Reserve Account”), (v) a payment account for the Liquidity Facility (the “Liquidity Payment Account”), (vi) a maintenance support account (the “Maintenance Support Account”), (vii) an aircraft disposition account (the “Aircraft Disposition Account”), (viii) an aircraft disposition contribution account (the “Aircraft Disposition Contribution Account”), (ix) a security deposit account (the “Security Deposit Account”), (x) a lessee-funded account (the “Lessee Funded Account”), (xi) an expense account (the “Expense Account”), (xii) one account (each, a “Series Account”) for each Series of Notes to be issued on the Initial Closing Date, (xiii) an E Certificate account (the “E Certificate Account”), (xiv) one or more redemption/defeasance accounts, if required (each, a “Redemption/Defeasance Account”), (xv) an account to accrue amounts in the event of a DSCR Cash Trap Event (the “DSCR Cash Trap Account”), (xvi) a hedge termination payment account (the “Hedge Termination Payment Account”), (xvii) an end of lease payments account (the “End of Lease Payments Account”) and (xviii) a PALA No. 1 Account (the “PALA No. 1 Account”). Such accounts, together with any accounts established by Labrador and the Aircraft Owning Subsidiaries or Leasing Subsidiaries, are under the control and dominion of the Security Trustee.

Servicer

GE Commercial Aviation Services Limited (“GECAS”), an Irish company, acts as servicer (the “Servicer”) with respect to the Aircraft pursuant to a Servicing Agreement (the “Servicing Agreement”) among Labrador and the Servicer. As Servicer, GECAS performs certain lease and other related services with respect to the Aircraft, including collecting lease payments from Lessees, monitoring the performance of the Lessees and the technical status of the Aircraft, complying with any lessor obligations to the Lessee on the lessor’s behalf, and remarketing the Aircraft for lease or sale. The Servicer receives as compensation for its services monthly fees.

Ownership of Labrador.

Labrador has a single class of ordinary shares, all of which are held in trust by a Bermudan trustee. The trustee owns 10 duly issued shares of the authorized share capital of Labrador having a nominal value of $1.00 each.

Governance of Labrador

Labrador has a board of directors (the “Board”) that manages the property and affairs of Labrador. The Board consists of five directors, four of whom (each an “Equity Director”) are nominated by or on behalf of the E Certificate Investors and who may be affiliated with the E Certificate Investor or the shareholders thereof. The other director (the “Independent Director”) was initially appointed by the initial directors of Labrador or the shareholder. The Independent Directors must be independent of the E Certificate Investor, and its shareholders and any of their respective affiliates, GECAS and its affiliates and must be knowledgeable with respect to the aviation industry and experienced in business and finance.