Business Context and Reporting Period
Willis Lease Finance Corporation (WLFC) filed this Form 8-K on December 23, 2025, to report the closing of a material definitive agreement involving its wholly-owned subsidiary, Willis Engine Structured Trust IX (WEST). The transaction involves the issuance of fixed-rate notes secured by a portfolio of 47 aircraft engines and two airframes.
Key Financial Metrics
- Total Note Issuance: $392,900,000 in aggregate principal amount.
- Series A Notes: $337,400,000 principal; 5.159% fixed coupon; issued at 99.99937% of par.
- Series B Notes: $55,500,000 principal; 5.696% fixed coupon; issued at 99.99686% of par.
- Maturity Profile: Expected maturity of approximately six years; expected weighted average life of 4.1 years; final maturity of 25 years.
- Collateral: 47 aircraft engines and two airframes to be acquired by WEST from Willis.
- Service Fees: Willis will receive a senior rent-based fee of 8.0%, a subordinated rent-based fee of 3.5%, and a 3.0% fee on net proceeds from asset sales.
- Administrative Fees: Willis will receive 2.0% of aggregate net rents as administrative agent.
Material Changes and Transaction Details
The filing details the execution of several agreements on December 23, 2025, including an Asset Purchase Agreement, Trust Indenture, Security Trust Agreement, Servicing Agreement, Administrative Agency Agreement, and a Revolving Credit Agreement with Bank of America, N.A. as the initial liquidity facility provider. Net proceeds from the notes will fund issuance expenses, reserve accounts for maintenance and security deposits, and payments to Willis for the acquisition of the aircraft assets over a 270-day delivery period. Willis will apply its share of the proceeds to general corporate purposes.
Guidance, Risks, and Contingencies
The filing does not provide specific forward-looking financial guidance or management commentary regarding future earnings. Key structural features and risks include:
- Covenants: The Indenture imposes limitations on additional debt, distributions, dividends, and asset dispositions for WEST, along with concentration lease limits.
- Bankruptcy Remoteness: Assets of WEST are not available to satisfy Willis's obligations or those of its affiliates, except for obligations specific to WEST.
- Liquidity Facility: A revolving credit agreement is in place to cover specific obligations, including interest on the Notes for a specified period.
- Regulatory Status: The Notes are not registered under the Securities Act of 1933 and are offered only to qualified institutional buyers under Rule 144A or outside the U.S. under Regulation S.
Investor Verification Checklist
- Verify the specific terms of the 270-day delivery period for the aircraft engines and airframes.
- Confirm the status of the reserve accounts for maintenance expenses and security deposits.
- Review the specific concentration lease limits imposed by the Indenture.
- Assess the impact of the 8.0% senior rent-based fee on the net yield to investors.
- Monitor the utilization of the revolving credit facility provided by Bank of America, N.A.