AerCo Annual Aircraft Appraisals 2014

AerCo Limited
13 Castle Street, St. Helier, Jersey, JE4 5UT Channel Islands

Under the terms of the trust indenture dated as of July 15, 1998 as supplemented on July 17, 2000, December 18, 2009 and November 10, 2011 (the “Trust Indenture”) governing the AerCo Notes, AerCo Limited (“AerCo” and, together with its subsidiaries “AerCo Group”) is required annually to commission an appraisal of the “base value” of the AerCo Group aircraft portfolio from at least three independent appraisers.

AerCo has obtained desktop appraisals of the “base value” of each of the seven aircraft in the AerCo Group portfolio for the year to February 19, 2014 from three independent aircraft value appraisers: Ascend, Aircraft Information Services, Inc. (“AISI”) and BK Associates, Inc. (“BK”). On the basis of these three appraisals (Ascend: $47.92 million; AISI: $56.02 million, BK: $73.47 million), the average appraised base value of AerCo Group’s portfolio as of February 19, 2014 was approximately $59.14 million (the “2014 Appraised Value”) compared with $71.05 million as of February 19, 2013 (adjusted to reflect the eight aircraft, three airframes and four engines sold in the year to February 2014).

The average appraised value at February 19, 2014 is $28.58 million lower than the assumed portfolio value at that date as per the principal payment tables included in the Trust Indenture. As a result of factors described in our recent Annual Report and Quarterly Cash Reports, AerCo is currently paying down only as far as the “Class A Minimum Principal Payment” at point (iv) in the priority of payments under the Trust Indenture. Cashflows were sufficient only on three payment dates since April 16, 2007 to make payment of class A minimum principal in full. On those three payment dates, some but not all of the accrued class B interest was also paid. No payments of interest on the class C and D notes or minimum principal on the class B, C and D notes have been made since April 2007. For this reason, the decline in the appraised portfolio value at February 19, 2014 will not impact the order of priority of payments to AerCo Noteholders.

For more information regarding the effect of our reduced cashflows on payments to Noteholders
please refer to Section V “Recent Developments – Overview of Current Financial Condition” of
the most recent Quarterly Cash Report.

Further information regarding the appraisals:
The appraisers ascertained the “base value” of each aircraft on the basis of an open, unrestricted, stable market environment with a reasonable balance of supply and demand, and with full consideration of each aircraft’s “highest and best use”, presuming an arm’s-length, cash transaction between willing, able and knowledgeable parties, acting prudently, with an absence of duress and with a reasonable period of time available for marketing, adjusted to account for the maintenance status of each aircraft (with certain assumptions as to use since the last reported status). In the case of AISI, for the 2014 appraisals “base value salvage” has been used for certain of the aircraft, given the significant proportion of the value of those aircraft now attributable solely to the engines. “Base value salvage” represents the base value of the engines with a run out airframe. Adjustments are then made to that value to account for the maintenance status of the engines but not the airframe.

The 2014 Appraised Value does not reflect the values of leases, maintenance reserves, security deposits or other collateral, if any, related to a particular aircraft.

An appraisal is only an estimate of value and there can be no assurance that proceeds received upon any sale of an aircraft would approximate the base value of that aircraft.

All capitalised terms not defined herein have the meanings provided by the Trust Indenture.

February 19, 2014.

For further information please contact: Donald McGowan or Eimear Gilmartin of AerCo Group’s Administrative Agent, AerCap Administrative Services Limited, at telephone number: +353 61 723600.