8-KRegulation FDOther Events

FTAI Aviation Ltd. 8-K Report, Regulation FD Disclosure (Jan 30, 2020)

Filed January 30, 2020For Securities:FTAIFTAIMFTAIN

Summary

FTAI Aviation Ltd. (FTAI) has filed an 8-K report detailing the pricing of a private offering of Series 2020 Bonds by its subsidiary, Jefferson Energy companies, and The Port of Beaumont Navigation District of Jefferson County, Texas. The offering, which is expected to close by February 11, 2020, amounts to an aggregate principal of $263,980,000, split between Series 2020A Dock and Wharf Facility Revenue Bonds ($184,920,000) and Taxable Series 2020B Facility Revenue Bonds ($79,060,000). These bonds are structured as special, limited obligations of the Port of Beaumont, with Jefferson bearing the economic responsibility for repayment. Crucially, the bonds do not represent indebtedness of any governmental entity and are not backed by the full faith and credit of any state or local subdivision. Jefferson intends to use the proceeds to refund existing debt, finance facility development and construction, and cover issuance costs. The filing also includes preliminary financial projections for Jefferson's funded facilities, anticipating annual run-rate revenues of $130-$150 million and EBITDA of $70-$80 million within twelve months of project completion, assuming certain capacity and utilization rates.

Key Highlights

  • 1FTAI's subsidiary, Jefferson Energy, priced $263.98 million in Series 2020 Bonds.
  • 2The offering includes $184.92 million in Series 2020A (fixed rate 3.625% and 4.00%) and $79.06 million in Taxable Series 2020B Bonds (fixed rate 6.00%).
  • 3The bonds are special, limited obligations secured by collateral, with Jefferson bearing the primary repayment obligation.
  • 4The bonds are not backed by the full faith and credit of any governmental entity.
  • 5Proceeds will be used for debt refunding, facility development/construction, and issuance costs.
  • 6Jefferson projects annual run-rate revenues of $130-$150 million and EBITDA of $70-$80 million for the funded facilities.
  • 7The offering was made to qualified institutional buyers and institutional accredited investors under Rule 144A and Regulation D.

Frequently Asked Questions

The net proceeds from the Series 2020 Bonds offering are intended by Jefferson to refund and defease certain existing indebtedness, to pay for or reimburse the cost of development, construction, and acquisition of certain facilities, to fund reserve and interest accounts, and to cover certain costs of issuing the bonds.

The Series 2020 Bonds are special, limited obligations. Jefferson bears the economic obligation to pay principal and interest, and the bonds are secured solely by the trust estate and pledged collateral. They do not constitute indebtedness of FTAI or any governmental entity, and the full faith and credit of any governmental body is not pledged.

Jefferson expects that within twelve months following the completion of the projects funded by this offering (anticipated by Q4 2020), its annual run-rate revenues for these facilities will be in the range of $130 million to $150 million, with annual run-rate EBITDA projected between $70 million and $80 million. These projections are based on certain storage capacity and utilization assumptions.

The Series 2020 Bonds were offered only to "qualified institutional buyers" under Rule 144A of the Securities Act of 1933 and to "institutional accredited investors" within the meaning of specific rules under the Securities Act. They were not offered to the general public.