Risk Factors Dashboard

Once a year, publicly traded companies issue a comprehensive report of their business, called a 10-K. A component mandated in the 10-K is the ‘Risk Factors’ section, where companies disclose any major potential risks that they may face. This dashboard highlights all major changes and additions in new 10K reports, allowing investors to quickly identify new potential risks and opportunities.

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Risk Factors - AYR

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ITEM 1A. RISK FACTORS

In addition to the other information set forth in this Annual Report, you should carefully consider the following factors, which could materially adversely affect our business, financial condition, results of operations in future periods or our ability to meet our debt obligations. The risks described below are not the only risks facing our Company. Additional risks not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, or results of operations.

Summary of Risk Factors

Risks Related to Our Lessees

•We are indirectly impacted by the risks facing airlines and their ability to perform their obligations under the relevant lease depends on their financial condition, which may be affected by factors beyond our control, such as currency movements, fuel price volatility, weak economic conditions, and geopolitical instability.

•Lessee defaults, bankruptcies, aircraft repossessions, and lease payment restructurings or rescheduling could have a material adverse impact on our future revenue and cash flows.

•An adverse economic or political event in any region or country in which our lessees or our aircraft are concentrated could have a material adverse effect on our financial results.

•Airlines operating in emerging markets face heightened political and economic risks, which could affect the ability of our lessees to meet their obligations to us.

Risks Related to Our Aviation Assets

•Lease rates and aircraft values are subject to supply-demand dynamics and may decline due to excess capacity or the introduction of new aircraft and engine technology.

•Climate-related regulations and preferences for more fuel-efficient aircraft could reduce demand for older aircraft types.

•The concentration of our portfolio around a specific aircraft or engine type could have a material adverse effect on our business should the aircraft or engine type encounter disruptions, manufacturing and quality control issues, or other difficulties.

•We operate in a highly competitive aircraft leasing market with low barriers to entry, which may make it difficult for us to take advantage of investment opportunities or make investments that are consistent with our investment objectives.

Risks Related to Our Leases

•A lessee may fail to meet its maintenance obligations or other operational requirements applicable under the relevant lease, which may require us to incur unanticipated or significant costs.

•The failure to pay certain operational costs and discharge liens on the aircraft could result in the grounding or arrest of our aircraft and prevent or delay the re-lease, sale or other use of our aircraft.

•Failure to obtain adequate insurance coverage or lessee noncompliance with indemnity provisions may result in us, as lessor, being held liable for losses from the operation of the aircraft.

•Political or regulatory restrictions may impair our ability to export, re-register, or transfer aircraft.

Risks Related to Our Operations

•We operate a global business that may be subject to events outside of our control, such as economic downturns, epidemic or pandemic diseases, terrorist attacks, war or armed hostilities, and natural disasters, which may adversely affect the demand for air travel.

•Foreign laws, rules, and regulations, as well as escalating tariffs, trade tensions, and protectionist measures may adversely affect our business, financial condition and results of operations.

•Our ability to obtain debt financing on satisfactory terms depends on financial market conditions, as well as our credit rating, and any volatility in the capital markets or a credit downgrade may increase our borrowing costs and adversely affect our earnings and cash flow.

•We bear the risk or re-leasing and selling our aircraft and may not fully recover our investment through either future lease cash flows or a sale, which may result in a write down of the value of some of our assets.

•We are subject to cybersecurity threats and data protection regulations, and failure to maintain secure IT systems could disrupt our operations.

Risks Related to Our Organization and Structure

•We are a holding company with no operations and rely on our operating subsidiaries to provide us with funds necessary to meet our financial obligations.

Risks Related to Taxation

•We are subject to complex and evolving tax laws in jurisdictions where we have significant operations, including Ireland, Bermuda, and the U.S., which may have an adverse effect on our results of operations.

•Our business would be adversely affected by the imposition of taxes should we no longer qualify for certain tax exemptions for which we are currently eligible.

•Global initiatives, such as the Organization for Economic Cooperation and Development’s (“OECD”) action plan with respect to base erosion and profit shifting (“BEPS”) may increase our effective tax rate and tax liabilities in future periods.

Risks Related to Our Lessees

Risks affecting the airline industry may materially adversely affect our customers.

We operate as a supplier to airlines and are indirectly impacted by the risks facing airlines. The ability of lessees to perform their obligations under the relevant lease depends on their financial condition, which may be affected by factors beyond our control, including:

•passenger and air cargo demand, fare levels and air cargo rates;

•operating costs, including the price and availability of jet fuel, labor costs and the cost, availability, and scope of insurance coverages;

•manufacturer production levels and reliability of new aircraft and engine types resulting from production quality issues and technical or other difficulties;

•restrictions in labor contracts and labor difficulties, including pilot shortages;

•availability of financing, including covenants in financings, terms imposed by credit card issuers, collateral posting requirements contained in hedging contracts and the ability of airlines to make or refinance principal payments;

•economic conditions, including economic downturns or recession, financial system distress and currency fluctuations;

•aircraft accidents or other safety-related events;

•the availability of government support through subsidies, loans, guarantees, equity investments;

•changing political conditions, including risk of protectionism, travel restrictions, or trade barriers;

•geopolitical events, including war, terrorism, epidemic or pandemic diseases and natural disasters;

•the impact of climate change and related compliance costs on demand and supply of air travel;

•cyber risk, including information hacking, viruses, ransomware and malware; and

•governmental regulation of airlines, including noise regulations, emissions regulations, climate change initiatives, and aircraft age limitations.

These factors, and others, may lead to defaults by our customers, may delay or prevent aircraft deliveries or transitions, may result in payment or other lease term restructurings, may increase our costs from repossessions or may reduce our revenues due to downtime or lower re-lease rates.

Adverse currency movements could negatively impact the profitability of our lessees.

Many of our lessees are exposed to currency risk as they earn revenues in local currencies while a significant portion of their liabilities and expenses, including fuel, debt service, and lease payments are denominated in U.S. dollars. If the local currency is devalued, our lessees may not be able to increase revenue sufficiently to offset the impact of exchange rates on these expenses. In addition, the implementation of strict currency controls by local governments may make it difficult for our lessees to access U.S. dollars. Shifts in foreign exchange rates can be significant, are difficult to predict, and can occur quickly.

Increases in fuel prices could negatively impact the profitability of our lessees.

Fuel price volatility may be exacerbated by geopolitical events, including armed conflicts, political instability or disruptions to global energy supply, which can result in sudden and sustained increases in fuel costs.

Lessee defaults could materially adversely affect our business, financial condition and results of operations.

Investors should expect some lessees to experience payment difficulties, particularly in difficult economic, financial or operating environments. Given the size of our aircraft portfolio, we expect that from time to time some lessees will be slow or will fail to make their payments in full under their leases.

A lessee may experience periodic difficulties that are not financial in nature, which could impair its performance of maintenance obligations under the leases.

In the event that a lessee defaults under a lease, any security deposit paid or letter of credit provided by the lessee may not be sufficient to cover the lessee’s outstanding or unpaid lease obligations and required maintenance and transition expenses.

Significant costs resulting from lease defaults could have a material adverse effect on our business.

We may be required to pay off liens, claims, taxes and other governmental charges to obtain clear possession and to remarket the aircraft for re-lease or sale. We may also incur maintenance, storage or other costs while we have physical possession of the aircraft.

We may suffer other adverse consequences due to a lessee default and the repossession of the aircraft. Our rights upon a lessee default vary significantly by jurisdiction and may include the need to obtain a court order for repossession

of the aircraft and consents for deregistration or re-export of the aircraft. When a defaulting lessee is in bankruptcy, protective administration, insolvency or similar proceedings, additional limitations may apply. Certain jurisdictions give rights to the trustee in bankruptcy or a similar officer to assume or reject the lease or to assign it to a third party, or entitle the lessee or another third party to retain possession of the aircraft without paying lease rentals or without performing all of the obligations under the lease. There can be no assurance that jurisdictions that have adopted the Cape Town Convention will enforce it as written. Certain of our lessees are owned in whole or in part by government-related entities, which could complicate our efforts to repossess the relevant aircraft. Accordingly, we may be delayed in, or prevented from, enforcing our rights under a lease and in re-leasing or selling the affected aircraft.

If we repossess an aircraft, we may not necessarily be able to export or deregister and redeploy the aircraft. If a lessee or other operator flies only domestic routes, repossession may be more difficult, especially if the jurisdiction permits the lessee or the other operator to resist deregistration. Significant costs may also be incurred in retrieving or recreating aircraft records required for registration of the aircraft and obtaining a certificate of airworthiness. A default and exercise of remedies involving a lessee where we have significant exposure could have a materially adverse impact on our future revenue and cash flows.

If our lessees encounter financial difficulties and we decide to restructure our leases with those lessees, this could result in less favorable leases and significant reductions in our cash flow.

When a lessee is late in making payments or fails to make payments in full, we may elect to or may be required to restructure the lease. Restructuring may involve anything from a simple rescheduling of payments to the termination of a lease without receiving all the past due amounts. We may be unable to agree upon acceptable terms for any requested restructurings and as a result may be forced to exercise our remedies under those leases and we may be unable to repossess our aircraft on a timely basis. If we, in the exercise of our remedies, repossess the aircraft, we may not be able to re-lease the aircraft promptly, at favorable rates, or at all.

The terms and conditions of payment restructurings or reschedulings, particularly involving lessees where we have significant exposure, may adversely affect our cash flows.

Airline reorganizations could have an adverse effect on our financial results.

Additional grounded aircraft and lower market values would adversely affect our ability to sell certain of our aircraft on favorable terms, or at all, or re-lease other aircraft at favorable rates comparable to the then current market conditions, which collectively would have an adverse effect on our financial results. We may not recover any of our claims or damages against an airline under bankruptcy or insolvency protection.

If our lessees fail to appropriately discharge aircraft liens, we might find it necessary to pay such claims.

In the normal course of business, liens that secure the payment of airport fees and taxes, custom duties, air navigation charges (including charges imposed by Eurocontrol), landing charges, crew wages, repairer’s charges, salvage or other liens, may, depending on the jurisdiction, attach to the aircraft. These liens may secure substantial sums that may, in certain jurisdictions or for certain types of liens (particularly “fleet liens”), exceed the value of the relevant aircraft. Although the financial obligations relating to these liens are the responsibility of our lessees, if they fail to fulfill their obligations, these liens may attach to our aircraft and ultimately become our responsibility. Until these liens are discharged, we may be unable to repossess, re-lease or sell the aircraft or unable to avoid detention or forfeiture of the aircraft.

Our lessees may not comply with their obligations under their respective leases to discharge liens arising during the terms of their leases. If they do not do so, we may find it necessary to pay the claims secured by any liens in order to repossess the aircraft.

Risks associated with the concentration of our lessees in certain geographical regions could harm our business or financial results.

Through our lessees and the countries in which they operate, we are exposed to the specific conditions and associated risks of those particular jurisdictions.

Many of our lessees operate in emerging markets and we are indirectly subject to the economic and political risks associated with such markets.

Risks Related to Our Aviation Assets

The variability of supply and demand for aircraft could depress lease rates for our aircraft.

The aircraft leasing and sales industry has experienced periods of aircraft oversupply. The oversupply of a specific type of aircraft in the market is likely to depress aircraft lease rates for, and the value of, that type of aircraft. The supply and demand for aircraft is affected by various cyclical and non-cyclical factors that are not under our control, including:

•passenger and air cargo demand;

•operating costs, including fuel costs, and general economic conditions affecting our lessees’ operations;

•foreign exchange rates;

•interest rates and the availability of capital to finance certain aircraft types;

•airline restructurings and bankruptcies;

•changes in control of, or restructurings of, other aircraft leasing companies;

•new-entrant manufacturers, or existing manufacturers producing new aircraft and engine types;

•manufacturer production levels, production quality control issues, and technical or other difficulties;

•geopolitical events, including war, prolonged armed conflict and acts of terrorism;

•governmental regulation, tariffs and other restrictions, such as sanctions, on trade or the leasing of aircraft;

•climate change initiatives, technological change, aircraft noise and emissions regulations, aircraft age limits and other factors leading to reduced demand for, early retirement or obsolescence of aircraft models;

•outbreaks of communicable diseases and natural disasters;

•reintroduction into service of aircraft previously grounded or in storage; and

•airport and air traffic control infrastructure constraints.

Other factors that could cause a decline in aircraft value and lease rates.

In addition to factors linked to the aviation industry generally, other factors that may affect the value and lease rates of our aircraft include:

•the age of the aircraft;

•the particular maintenance and operating history of the airframe and engines;

•the number of operators using that type of aircraft;

•whether the aircraft is subject to a lease and, if so, whether the lease terms are favorable to the lessor;

•the demand for and availability of such aircraft;

•applicable airworthiness directives or manufacturer’s service bulletins that have not yet been performed;

•grounding orders or other regulatory action that could prevent or limit utilization of our aircraft;

•regulatory and legal requirements that must be satisfied before the aircraft can be purchased, sold or re-leased; and

•compatibility of our aircraft configurations or specifications with those desired by operators and financiers.

Any decrease in the values of, or lease rates for, commercial aircraft which may result from the above factors or other unanticipated factors may have a material adverse effect on our financial results.

Climate change may have a long-term impact on our business.

There are inherent climate-related risks wherever our business is conducted. Various countries, including the United States and countries in the European Union (“E.U.”), have announced sustainability initiatives that, among other things, aim to reduce carbon emissions, explore sustainable aviation fuels and establish sustainability measures and targets. Developing climate and environmental regulations may impact the types of aircraft we target for investment and the demand for certain aircraft and engine types, and could result in a significant increase in our costs and expenses, including compliance, reporting, operational and capital costs, and adversely affect future revenue, cash flows and financial performance. Failure to address climate change or to adapt our business strategy to evolving climate-related expectations could result in greater exposure to economic and other risks and impact our ability to meet developing climate goals.

The introduction of new technology aircraft types and higher production levels could cause our existing aircraft portfolio to become outdated and therefore less desirable.

New technology aircraft may shorten the economic lives of certain aircraft in our portfolio or limit demand for those aircraft. Certain new technology aircraft programs, including the Boeing 737 MAX and 787 and the Airbus A220, A320neo family, A330neo and A350, are currently in production. has developed aircraft models intended to compete with certain narrow-body aircraft manufactured by Airbus and Boeing, as well as regional jet aircraft manufactured by Embraer. These new technology aircraft types, and potential variants of these types, may reduce the desirability of, and have an adverse effect on the residual values and future lease rates of, older aircraft types and variants.

The effects of emissions and noise regulations and policies may challenge the current growth trajectory of the airline industry. Sustainability regulations and initiatives could increase the operating costs of our customers.

Many governments have imposed limits on aircraft engine emissions, such as NOx, CO and CO2, consistent with current International Civil Aviation Organization (“ICAO”) standards. In February 2024, the Federal Aviation Administration released guidance to reduce carbon pollution emitted by most large airplanes flying in U.S. airspace. The rule requires incorporating improved fuel-efficient technologies for airplanes manufactured after January 1, 2028, and for subsonic jet airplanes and large turboprop and propeller airplanes that are not yet certified.

European countries have relatively strict environmental regulations that can restrict operational flexibility and decrease aircraft productivity. The E.U. has included the aviation sector in its emissions trading scheme (“ETS”), a cap-and-trade system that sets a limit on the amount of carbon dioxide that can be emitted by all industries, including aviation. Although the ETS was initially implemented granting free emissions allowances based on an airline’s emissions history, a 2023 proposal was adopted by the European Parliament and the European Council, which modifies the ETS system such

that ETS free emissions allowances will phase out for the aviation sector by 2026. Although the ETS is likely to increase costs for airlines operating in Europe, it remains to be seen what effect, if any, this will have on our business.

ICAO adopted a global market-based measure to control CO2 emissions from international aviation called the Carbon Offsetting and Reduction Scheme for International Aviation (“CORSIA”). CORSIA is currently in its first phase (2024-2026) wherein compliance applies only to routes between countries that have each volunteered to participate in the scheme. All airlines that operate routes between two volunteering countries will be subject to the offsetting requirements. From 2027 onwards, CORSIA compliance will be mandatory.

Sustainable Aviation Fuel has been identified by IATA as the primary means by which IATA’s NetZero 2050 goal is to be achieved. Many governments, including the E.U., the United Kingdom, Brazil and Japan, have mandated aviation operators employ benchmarked percentages of SAF “drop in” blend on future commercial flights. A significant increase in SAF production will be required to make these benchmarks attainable, and at present, the cost of SAF is approximately two to three times the cost of fossil jet fuel. Meeting mandated SAF blends could pose a significant operating cost to our customers.

Over time, it is possible that governments will adopt additional regulatory requirements and/or market-based policies to reduce emissions and noise levels from aircraft. Such initiatives may be based on concerns regarding climate change, energy security, public health, local impacts, or other factors, and may impact the global market for certain aircraft and cause behavioral shifts that result in decreased demand for air travel. These concerns could result in limitations on our customers’ operation of our fleet and our ability to lease or re-lease certain older aircraft, particularly aircraft equipped with older technology engines.

Compliance with current or future regulations could cause our lessees to incur higher costs and lead to higher ticket prices, which could mean lower demand for travel and adverse impacts on the financial condition of our lessees. Such compliance may also affect our lessees’ ability to make rental and other lease payments and limit the market for aircraft in our portfolio.

Corporate responsibility, specifically related to ESG matters, could expose us to additional risks and costs.

In recognition of this trend, organizations are sometimes evaluated by rating agencies using differing and evolving sustainability evaluation criteria, which, in some cases, results in ESG-specific ratings or scores. Certain institutional investors and lenders, including those that invest in our unsecured notes or provide secured lending facilities, may be required or may choose to consider ESG-related risks in allocating capital. As a result, they may limit exposure to certain industries or companies based on ESG considerations. Our ability to obtain financing at strategic rates could be impacted by these perceptions and ratings or by any developing key performance indicators which the Company and financiers may develop over time.

More recently, there has been increased divergence in ESG-related regulation, policy and sentiment across jurisdictions, including differing approaches in the United States and in certain international markets, which may result in regulatory or compliance uncertainty. Our efforts to implement ESG-related initiatives, and the timing and manner of their adoption, may be impacted by broader changes in ESG sentiment (including those in opposition to ESG principles), policy shifts and divergence of regulations, policies and practices with respect to these matters. If we are unable to meet ESG-related standards or expectations, whether established by us or third parties, it could result in adverse publicity, reputational harm, and/or loss of investment, which could adversely affect our business, results of operations, financial condition, and liquidity.

The older age of some of our aircraft may expose us to higher maintenance-related expenses.

Additionally, older aircraft typically are less fuel-efficient than newer aircraft and may be more difficult to re-lease or sell, particularly if, due to increasing production rates by aircraft manufacturers or airline insolvencies, older aircraft are competing with a greater supply of newer aircraft in the lease or sale market. We may also incur some of these increased maintenance expenses and regulatory costs upon acquisition or re-leasing of our aircraft. In

addition, the re-leasing of larger wide-body aircraft may result in higher reinvestment and maintenance expenditures than re-leasing narrow-body aircraft.

The concentration of aircraft or engine types in our portfolio could lead to adverse effects on our business should any difficulties specific to a particular type of aircraft or engine occur.

Our portfolio is concentrated in certain aircraft and engine types. The supply of commercial aircraft is dominated by Airbus and Boeing and there are a limited number of engine manufacturers. Should any aircraft or engine types or any manufacturers encounter disruptions, including supply chain issues, manufacturing and quality control issues, financial instability or other difficulties, it would cause a decrease in the value of these assets, an inability to lease them on favorable terms or at all, or a potential grounding of these aircraft or engines, which may adversely impact our financial results, to the extent the affected type comprises a significant percentage of our portfolio.

Certain engine‑specific issues have adversely affected parts of the commercial aviation industry in recent years. For example, there has been an ongoing impact related to Pratt & Whitney geared turbofan engines, which has resulted in the temporary grounding of a significant number of Airbus A320 family aircraft worldwide. While these issues may moderate over time, they are expected to persist into the latter part of the decade, and could continue to result in reduced aircraft utilization, higher maintenance costs or extended downtime. In addition, delays in aircraft or engine deliveries from manufacturers, including Airbus and Boeing, could also adversely affect our business, results of operations, financial condition, and liquidity. Elevated levels of engine groundings may place additional pressure on maintenance facilities and engine repair shops.

We operate in a highly competitive market for investment opportunities and for the leasing and sale of aircraft.

The aircraft leasing industry is highly competitive and we compete with other lessors, airlines, aircraft manufacturers, financial institutions, aircraft brokers and other investors with respect to aircraft acquisitions, leasing and sales.

A number of our competitors are substantially larger and have considerably greater financial, technical and marketing resources than we do. Some competitors may have a lower cost of funds and access to funding sources that are not available to us. Some of our competitors may provide financial services, maintenance services or other inducements to potential lessees or buyers that we are unable or unwilling to provide. As a result of competitive pressures, we may not be able to take advantage of attractive investment opportunities, and we may not be able to identify and make investments that are consistent with our investment objectives. Additionally, the barriers to entry in the aircraft acquisition and leasing market are comparatively low, and new entrants appear from time to time. We may not be able to compete effectively against present and future competitors in the aircraft acquisition, leasing or sales market.

Periods of prolonged aircraft delivery delays may cause some aircraft lessors to adjust their investment strategies, including increasing their focus on secondary market acquisitions. To the extent such shifts occur, competition in the secondary market may intensify, which could adversely affect acquisition pricing, asset availability or our ability to execute our growth strategy.

Risks Related to Our Leases

If lessees are unable to fund their maintenance obligations on our aircraft, we may incur increased costs at the conclusion of the applicable lease.

The standards of maintenance observed by lessees and the condition of the aircraft may affect the future values and rental rates for our aircraft.

Under our leases, the lessee is responsible for maintaining the aircraft and complying with all governmental requirements applicable to the lessee and the aircraft, including, operational, maintenance, and registration requirements

and airworthiness directives, although in certain cases we may agree to share certain of these costs. Failure of a lessee to perform required aircraft maintenance or required airworthiness directives could result in a decrease in value of such aircraft, an adverse effect on our ability to lease the aircraft at favorable rates or at all, or a potential grounding of such aircraft, and will likely require us to incur increased maintenance and modification costs upon the expiration or earlier termination of the applicable lease, which could be substantial, to restore such aircraft to an acceptable condition. If any of our aircraft are not subject to a lease, we would be required to bear the entire cost of maintaining that aircraft and performing any required airworthiness directives.

Our leases may require the lessee to make periodic payments to us during the lease term to provide reserves for major maintenance events. In such cases, we generally have an obligation to reimburse the lessee for qualifying maintenance once performed.

Even if we receive maintenance payments, these payments may not cover the entire expense of the scheduled maintenance they are intended to fund. In addition, maintenance payments typically cover only certain scheduled maintenance requirements and may not cover all required maintenance and all scheduled maintenance. As a result, we may incur unanticipated or significant costs at the conclusion of a lease.

Failure to pay certain potential additional operating costs could result in the grounding or arrest of our aircraft and prevent the re-lease, sale or other use of our aircraft.

As in the case of maintenance costs, we may incur other operational costs upon a lessee default or where the terms of the lease require us to pay a portion of those costs. Such costs include:

•the costs of casualty, liability and political risk insurance and the liability costs or losses when insurance coverage has not been or cannot be obtained as required, or is insufficient in amount or scope;

•the costs of licensing, exporting or importing an aircraft, airport charges, customs duties, air navigation charges, landing fees and similar governmental or quasi-governmental impositions, which can be substantial;

•penalties and costs associated with the failure of lessees to keep aircraft registered under all appropriate local requirements or obtain required governmental licenses, consents and approvals; and

•carbon taxes or other fees, taxes or costs imposed under emissions limitations, climate change regulations or other initiatives.

The failure to pay certain of these costs can result in liens on the aircraft. The failure to register the aircraft can result in a loss of insurance. These matters could result in the grounding or arrest of the aircraft and prevent the re-lease, sale or other use of the aircraft until the problem is cured.

Our lessees may have inadequate insurance coverage or fail to fulfill their respective indemnity obligations, which could result in us not being covered for claims asserted against us.

By virtue of holding title to the aircraft, lessors may be held strictly liable for losses resulting from the operation of aircraft or may be held liable for those losses based on other legal theories. Liability may be placed on an aircraft lessor in certain jurisdictions even under circumstances in which the lessor is not directly controlling the operation of the aircraft.

Lessees are required under our leases to indemnify us for, and insure against, liabilities arising out of the use and operation of the aircraft, including third-party claims for death or injury to persons and damage to property for which we may be deemed liable. Lessees are required to maintain public liability, property damage and hull all risk and hull war risk insurance on the aircraft at agreed upon levels. However, they are not generally required to maintain political risk insurance. Following the September 11, 2001 terrorist attacks and, more recently, the Russian invasion of Ukraine, aviation insurers have reassessed their coverage and significantly increased premiums. Aviation insurers significantly reduced the amount of insurance coverage available to airlines for liability to persons other than employees or passengers for claims resulting from acts of terrorism, war or similar events. At the same time, they significantly increased the premiums for such third-party war risk and terrorism liability insurance and coverage in general. As a result, the amount of such third-party war risk and terrorism liability insurance that is commercially available at any time may be below the amount stipulated in our leases.

Our lessees’ insurance (including any available governmental supplemental coverage) and our contingent and possessed insurance may not cover, or be sufficient to cover, all types of claims that may be asserted against us and recovery may also be subject to aggregate limits. Any inadequate insurance coverage or default by lessees in fulfilling their indemnification or insurance obligations will reduce the proceeds that would be received by us upon an event of loss under the respective leases or upon a claim under the relevant liability insurance.

Failure to obtain certain required licenses and approvals could negatively affect our ability to re-lease or sell aircraft.

These may include consents required for certain payments under the leases and for the import, export or deregistration of the aircraft. Subsequent changes in applicable law or administrative practice may increase such requirements and a governmental consent, once given, might be withdrawn. Consents needed in connection with future re-leasing or sale of an aircraft may not be forthcoming. Any of these events could adversely affect our ability to re-lease or sell aircraft.

Risks Related to Our Operations

Escalating tariffs, trade tensions, and protectionist measures may adversely affect our business, financial condition and results of operations.

Our business relies on the global movement of aircraft across international borders, and our airline customers operate in a highly interconnected global marketplace. More recently, certain governments have introduced new tariffs or expanded existing trade and protectionist measures, and such measures continue to evolve, creating ongoing uncertainty that may affect our operations.U. and China, may impact where we can source aircraft acquisitions, place and deliver aircraft, and sell or dispose of aircraft and other flight equipment. The implementation and enforceability of trade restrictions, or the expansion, modification or re-imposition of existing tariffs and other trade barriers may negatively impact our business and financial performance, including, but not limited to:

•tariffs on aircraft, engines and related components, which may increase aircraft acquisition costs, maintenance, expenses or operating costs borne by us or our lessees;

•retaliatory or reciprocal trade measures may disrupt global supply chains for aircraft and engine manufacturers, potentially resulting in delivery delays, reduced production rates or increased costs;

•restrictions, approvals or other regulatory requirements affecting cross-border leasing, financing, ownership or transfer of aircraft, which could complicate, delay or prevent transactions or limit our ability to place aircraft with certain lessees;

•trade restrictions or route-specific limitations may impair our lessees' ability to operate profitably in certain markets, potentially affecting their financial condition and ability to meet lease payment obligations; and

•broader geopolitical or economic instability arising from prolonged trade disputes, which may affect regions where we have significant assets deployed or reduce demand for air travel in certain markets.

Given the ongoing and dynamic nature of global trade policies and related uncertainties, it is difficult to predict the scope, timing, duration, enforceability or impact of tariffs, trade restrictions or related government actions, or their cumulative effect on us, our lessees or aircraft and engine manufacturers. Unfavorable trade policies, including tariffs, export and import restrictions, sanctions or other regulatory controls and uncertainties regarding the ability to obtain refunds for previously paid tariffs that have been invalidated, may adversely affect our business, financial condition, and results of operations.

Events outside of our control, including economic downturns, the threat or realization of epidemic or pandemic diseases, terrorist attacks, war or armed hostilities between countries or non-state actors, and natural disasters may adversely affect the demand for air travel, the financial condition of our lessees and of the aviation industry more broadly, and may ultimately impact our business.

Air travel can be disrupted, sometimes severely, by the occurrence of unexpected events outside of our and our lessees’ control. Such events may include disruptions to government operations, including partial or full shutdowns of government services, which could result in reduced staffing or operational constraints at airports or aviation-related

agencies, such as the Transportation Security Administration, leading to longer security wait times, flight delays or reduced passenger demand.

Passenger demand for air travel has been materially affected by epidemic and pandemic diseases. Most recently, the COVID-19 pandemic resulted in a significant decline in global air travel levels, and prior epidemics and health events, including severe acute respiratory syndrome, bird flu, swine flu, the Zika virus, and Ebola, have also negatively affected air travel. To the extent our lessees lack sufficient liquidity to withstand such periods, and are unable to obtain funding from private, government or other sources, we may be required to provide lease concessions, including deferrals or broader lease restructurings, which may negatively impact our business, financial condition, cash flows and results of operations.

They may also lead to higher insurance costs due to the increased security measures and potential special charges, such as those related to the impairment of aircraft and other long-lived assets stemming from the above conditions. Airspace closures have and may require certain of our airline customers to continue re-routing flights to avoid such airspace which has resulted in increased flight times and fuel costs. Such geopolitical instability and uncertainty could have a negative impact on our ability to lease aircraft, collect payments from, and support customers in certain regions based on trade restrictions, embargoes and export control law restrictions, and logistics restrictions, including closures of air space, and could materially adversely affect our business, financial condition, and results of operations.

Volatile financial market conditions may adversely impact our liquidity, our access to capital and our cost of capital and may adversely impact the airline industry and the financial condition of our lessees.

We bear the risk of re-leasing and selling our aircraft.

We bear the risk of re-leasing or selling our aircraft in order to generate cash flows. In certain cases, we commit to purchase aircraft that are not subject to lease and therefore are subject to lease placement risk.

We own and lease long-lived assets, and adverse market conditions or customer defaults may require us to write down the value of some of our assets.

We perform recoverability assessments of our aircraft and other flight equipment at least annually, and more frequently when events or changes in circumstances indicate that the carrying amount or net book value of an asset may not be recoverable. We perform aircraft-specific recoverability tests whenever such indicators exist.

If our estimates or assumptions change, we may revise our cash flow assumptions and record future impairment charges.

Departure of key officers could harm our business and financial results.

Our senior management’s reputations and relationships with lessees, sellers, buyers and financiers of aircraft are a critical element of our business. Our future success depends, to a significant extent, upon the continued service of our senior management personnel, including the Chief Executive Officer, and if we lose one or more of these individuals, our business could be adversely affected.

We are subject to risks related to our indebtedness that may limit our operational flexibility and our ability to compete with our competitors.

As of February 28, 2026, our total indebtedness was $5.3 billion, representing 66% of our total capitalization. We may be unable to generate sufficient cash to pay, when due, the principal of, interest on or other amounts due with respect to our indebtedness. Our substantial amount of indebtedness may increase our vulnerability to adverse economic and industry conditions, reduce our flexibility in planning for or reaction to changes in our business or industry, and adversely affect our cash flow and our ability to operate our business and compete effectively with our competitors. Our indebtedness subjects us to certain risks, including:

•while our current levels of secured indebtedness are limited, future increases in secured indebtedness may require us to pledge aircraft or other assets as collateral, which could limit our flexibility to sell or otherwise dispose of such aircraft, restrict our ability to incur additional indebtedness, or require us to apply proceeds from asset sales to repay such indebtedness;

•failure to comply with the terms of our indebtedness, including restrictive covenants, may result in additional interest being due, events of default or the acceleration of principal and unpaid interest on such indebtedness, and may result in the forfeiture of aircraft pledged as collateral; and

•non-compliance with covenants prohibiting certain investments and other restricted payments, raising additional capital or refinancing our existing debt, may reduce our operational flexibility and limit our ability to refinance.

Our ability to obtain debt financing and our cost of debt financing is, in part, dependent upon our credit ratings and a credit downgrade or being put on negative watch could adversely impact our financial results.

Any such downgrade or negative watch may make it more difficult or more costly for us to satisfy our funding requirements.

An increase in our borrowing costs may adversely affect our earnings.

We primarily finance our business through the issuance of senior notes. As our senior notes mature, we may be required to repay them by issuing new senior notes, which could result in higher borrowing costs, or repay them by using cash on hand or cash from the sale of our assets.

The provisions of our long-term financings require us to comply with financial and other covenants. Our compliance with these ratios, tests and covenants depends upon, among other things, the timely receipt of lease payments from our lessees and upon our overall financial performance.

•Senior Notes. Our senior note indentures impose operating and financial restrictions on our activities. These restrictions limit our ability to, or in certain cases prohibit us from incurring liens and include a cross-default to certain other financings of the Company.

•Unsecured Revolving Credit Facilities and Term Loan. Our unsecured revolving credit facilities and term loan contain $1.1 billion minimum net worth covenants, minimum unencumbered asset ratios, minimum fixed coverage ratios and cross-defaults to certain other financings of the Company.

The terms of our financings also restrict our ability to incur or guarantee additional indebtedness or engage in mergers, amalgamations or consolidations among our subsidiary companies or between a subsidiary company and a third party or otherwise dispose of all or substantially all of our assets.

We are subject to various risks and requirements associated with foreign laws, rules and regulations.

The international nature of our business exposes us to trade and economic sanctions and other restrictions imposed by the U.S. and other governments. The U.S. Departments of Justice, Commerce and Treasury, as well as other agencies and authorities have a broad range of civil and criminal penalties, they may seek to impose against companies for violations of export controls, the Foreign Corrupt Practices Act (“FCPA”), and other federal statutes, sanctions and regulations, including those established by the Office of Foreign Assets Control (“OFAC”). Increasingly, similar or more restrictive foreign laws, rules and regulations, including the U.K. Bribery Act (“UKBA”), and European laws and regulations may also apply to us. By virtue of these laws and regulations, we may be obliged to limit our business activities, we may incur costs for compliance programs and we may be subject to enforcement actions or penalties for noncompliance. In recent years, U.S. and foreign governments have increased their oversight and enforcement activities with respect to these laws, and we expect the relevant agencies to continue to increase these activities.

We have compliance policies and training programs in place for our employees with respect to FCPA, OFAC Regulations, UKBA and similar laws, but there can be no assurance that our employees, consultants or agents will not

engage in conduct for which we may be held responsible. Violations of FCPA, OFAC Regulations, UKBA and other laws, sanctions or regulations may result in severe criminal or civil penalties, and we may be subject to other liabilities.

The General Data Protection Regulation (“GDPR”) requires us to protect certain personal data of E.U. citizens. While we have implemented processes and controls to comply with GDPR requirements, the manner in which the E.U. will interpret and enforce certain provisions remains unclear and we could incur significant fines of up to 4% of worldwide revenue, individual damages and reputational risks if the E.U. determines that our controls and processes are ineffective and we have failed to adequately comply with the requirements.

We are dependent upon information technology systems, which are subject to disruption, damage, failure and risks associated with implementation and integration.

We are dependent upon information technology systems to manage, process, store and transmit information associated with our operations, which may include proprietary business information and personally identifiable information of our customers, suppliers and employees. There may also be an elevated risk of cyber-attacks and cybersecurity incidents by certain countries based on geopolitical tensions and events. Damage, disruption, or failure of information technology systems may result in interruptions to our operations or may require a significant investment to fix or replace them or may result in significant damage to our reputation.

Risks Related to Our Organization and Structure

We are a holding company with no operations and rely on our operating subsidiaries to provide us with funds necessary to meet our financial obligations.

Aircastle Limited is a holding company with no material direct operations. Our principal assets are the equity interests we directly or indirectly hold in our operating subsidiaries. As a result, we are dependent on loans, dividends, distributions and other payments from our subsidiaries to generate the funds necessary to meet our financial obligations, including our debt service obligations. Although there are currently no material legal restrictions on our operating subsidiaries’ ability to distribute assets to us, legal restrictions, including governmental regulations and contractual obligations, or future debt agreements entered into by us or our subsidiaries, could restrict, prohibit or impair our operating subsidiaries’ ability to pay dividends or make loan or other distributions to us. Our subsidiaries are legally distinct from us and may be prohibited or restricted from paying dividends or otherwise making funds available to us under certain conditions.

Risks Related to Taxation

If Aircastle were treated as engaged in a trade or business in the United States, it would be subject to U.S. federal income taxation on a net income basis, which would adversely affect our business.

If, contrary to expectations, Aircastle were treated as engaged in a trade or business in the United States, the portion of its net income, if any, that was “effectively connected” with such trade or business would be subject to U.S. federal income taxation at a maximum rate of 35% for taxable years ending on or prior to December 31, 2017 and 21% for taxable years beginning after December 31, 2017 (such rate, the “Federal Rate”). In addition, Aircastle would be subject to the U.S. federal branch profits tax on its effectively connected earnings and profits at a rate of 30%. The imposition of such taxes would adversely affect our business.

The U.S. Corporate Alternative Minimum Tax (“AMT”) proposals may impact our effective tax rate in future periods.

On August 16, 2022, President Biden signed into law the Inflation Reduction Act (the “IRA”). The IRA includes a provision which imposes a 15% minimum tax on adjusted financial statement income (“AFSI”) for corporations. For a corporation that is a member of a foreign-parented multi-national group, the AMT applies where (i) the three-year

average annual AFSI from all members of the foreign-parented multi-national group exceeds $1 billion, and (ii) the three-year average annual AFSI from the group’s U.S. corporation(s) is $100 million or more. The application of the corporate alternative minimum tax remains subject to evolving administrative guidance, including proposed regulations issued by the U.S. Department of the Treasury, and any final regulations or other guidance could differ materially from currently available guidance.

We do not currently expect the corporate alternative minimum tax to have a material impact on our financial position. However, we will continue to evaluate the impact as further information becomes available.

If there is not sufficient trading in shares of our ultimate parent company, or if 50% of such shares are held by certain 5% shareholders, we could lose our eligibility for an exemption from U.S. federal income taxation on rental income from our aircraft used in “international traffic” and could be subject to U.S. federal income taxation, which would adversely affect our business.

We expect that we are currently eligible for an exemption under Section 883 of the Internal Revenue Code of 1986, as amended (the “Code”), which provides an exemption from U.S. federal income taxation with respect to rental income derived from aircraft used in international traffic by certain foreign corporations. No assurances can be given that we will continue to be eligible for this exemption. To qualify for this exemption in respect of rental income, the lessor of the aircraft must be organized in a country that grants a comparable exemption to U.S. lessors (Bermuda and Ireland each do), and certain other requirements must be satisfied. We can satisfy these requirements in any year if, for more than half the days of such year, our shares are primarily and regularly traded on a recognized exchange and certain shareholders, each of whom owns 5% or more of our shares (applying certain attribution rules), do not collectively own more than 50% of our shares. Following the Merger, these stock ownership requirements are currently tested at the Marubeni and Mizuho Leasing levels such that Aircastle and its subsidiaries can continue to qualify for the Section 883 exemption if the stock of Marubeni is considered to be primarily and regularly traded on a recognized stock exchange and non-qualifying 5% or greater shareholders are not considered to collectively own more than 50% of Marubeni’s shares, as described above. If Marubeni’s shares cease to satisfy these requirements, then we may no longer be eligible for the Section 883 exemption with respect to rental income earned by aircraft used in international traffic. If we were not eligible for the exemption under Section 883 of the Code, we expect that the U.S. source rental income of Aircastle Bermuda generally would be subject to U.S. federal taxation, on a gross income basis, at a rate of not in excess of 4% as provided in Section 887 of the Code. If, contrary to expectations, Aircastle Bermuda did not comply with certain administrative guidelines of the Internal Revenue Service, such that 90% or more of Aircastle Bermuda’s U.S. source rental income were attributable to the activities of personnel based in the United States, Aircastle Bermuda’s U.S. source rental income would be treated as income effectively connected with the conduct of a trade or business in the United States. In such case, Aircastle Bermuda’s U.S. source rental income would be subject to U.S. federal income taxation on its net income at the Federal Rate as well as state and local taxation. In addition, Aircastle Bermuda would be subject to the U.S. federal branch profits tax on its effectively connected earnings and profits at a rate of 30%. The imposition of such taxes would adversely affect our business.

We are subject to risks related to the Bermuda Economic Substance Act 2018.

Pursuant to the Economic Substance Act 2018 (as amended) of Bermuda (the “ESA”) that came into force in January 2019, a resident entity, other than an entity which is resident for tax purposes in certain jurisdictions outside Bermuda, that carries on as a business in any one or more of the “relevant activities” referred to in the ESA must comply with economic substance requirements. The ESA may require in-scope Bermuda entities which are engaged in such “relevant activities” to be directed and managed in Bermuda, have an adequate level of qualified employees in Bermuda, incur an adequate level of annual expenditure in Bermuda, maintain adequate physical presence in Bermuda or perform core income-generating activities in Bermuda. The list of “relevant activities” includes, among other things, carrying on any one or more of: insurance, financing and leasing (which excludes operating leases), headquarters, intellectual property and holding entities.

Entities subject to the economic substance requirements are required to evidence their compliance and file an economic substance declaration with the Registrar of Companies in Bermuda on an annual basis.

Any entity that must satisfy economic substance requirements but fails to do so could face financial penalties, a restriction of its business activities, automatic reporting by the Bermuda authorities to the competent authorities in the E.U. or other jurisdiction of the entity’s beneficial owners, on an entity’s non-compliance or being struck-off as a

registered entity in Bermuda. If any one of the foregoing were to occur it may adversely affect the business operations of the Company or its Bermuda subsidiaries.

The Company and its Bermuda subsidiaries believe they have complied with the ESA requirements and have filed, and will continue to file, annual economic substance declarations with the Registrar of Companies in Bermuda as required. The Registrar of Companies in Bermuda ultimately assesses compliance with the ESA requirements.

We are subject to a Corporate Income Tax Regime in Bermuda.

In December 2023, the Government of Bermuda enacted the Bermuda Corporate Income Tax Act (“CIT Act”) which imposes a 15% corporate income tax effective for tax years beginning on or after January 1, 2025. Accordingly, the Company is subject to Bermuda corporate income tax with respect to its fiscal year beginning March 1, 2025 and subsequent years as a Bermuda constituent entity of a multi-national group. A multi-national group is defined for these purposes as a group with entities in more than one jurisdiction with consolidated revenues of at least €750 million for two out of the four previous fiscal years.

Previously, Irish Revenue had issued certain confirmations regarding the application of the 12.5% tax rate to activities, such as leasing and financing, undertaken by Irish lessors. Irish Revenue has advised that these confirmations no longer apply, effective as of January 1, 2024. Instead, certain aspects of the Irish leasing regime have been codified into law in Finance Act (No. The combination of the revised law and guidance could impose a higher threshold on our Irish lessors and financing companies when demonstrating they have sufficient activity to avail themselves of the 12.5% tax rate on their leasing and financing activity. The changes, along with any associated restructuring that may be required, could increase our Irish effective tax rate.

Our Irish subsidiaries and affiliates are expected to be subject to corporation tax on their income from leasing, managing, and servicing aircraft at the 12.5% tax rate applicable to trading income. This expectation is based on certain assumptions, including that we will maintain at least the current level of our business operations in Ireland. The tax treatment of financing activity within the group, however, is much less certain. If we are not successful in achieving trading status in Ireland, the non-trading income activities of our Irish subsidiaries and affiliates would be subject to tax at the rate of 25% and capital gains would be taxed at the rate of 33%. Furthermore, certain expenses in non-trading companies may also be non-deductible for tax purposes, increasing the effective tax rate further.

The Finance Act (No. 2) 2023 also introduced outbound payment rules which apply to certain interest and royalty payments and, distributions made by a company to an “associated entity” on or after April 1, 2024. The rules apply withholding tax, or disapply existing domestic withholding tax exemptions, to certain outbound payments. Two entities will be associated if there is more than a 50% relationship in terms of share capital or ownership. Two entities will also be associated in cases where one entity has definite influence in the management of the other entity, or where the two entities are both associated entities of another entity. Transactions with unrelated third parties should not be affected by the provisions. In addition, to be in scope of the rules, the interest or royalty payment must also be made by a company to an “associated entity” that is resident in a “specified territory.”

Aircraft lease rentals are outside the scope of these rules (as they are not considered to be a royalty). There are a number of exemptions available with respect to interest payments, including where the payment is an “excluded payment. The outbound payment rules may therefore apply to certain payments which may increase the effective tax rate in Ireland.

Ireland has implemented Pillar Two and we may incur additional top-up tax charges in future periods to ensure that the Irish companies are taxed at a minimum effective tax rate of 15%.

We may become subject to income or other taxes in the non-U.S. jurisdictions in which our aircraft operate, where our lessees are located or where we perform certain services which would adversely affect our business.

Certain Aircastle entities are expected to be subject to the income tax laws of Bermuda, Ireland and the United States. In addition, we may be subject to income or other taxes in other jurisdictions by reason of our activities and operations, where our aircraft operate or where the lessees of our aircraft (or others in possession of our aircraft) are located. Although we have adopted operating procedures to reduce the exposure to such taxation, we may be subject to such taxes in the future and such taxes may be substantial. In addition, if we do not follow separate operating guidelines relating to managing a portion of our aircraft portfolio through offices in Ireland and Singapore, income from aircraft not owned in such jurisdictions would be subject to local tax. Changes in tax law could impose withholding taxes on lease payments during the term of a lease. Our leases typically require our lessees to indemnify us in respect of taxes, however, a lessee may fail to make such indemnification payment. The imposition of such taxes could adversely affect our business.

The introduction of Base Erosion and Profit Shifting by the Organization for Economic Cooperation and Development may impact our effective tax rate in future periods.

The Organization for Economic Cooperation and Development (the “OECD”) has introduced an action plan with respect to base erosion and profit shifting (“BEPS”). The plan targets, among other things, tax avoidance measures such as hybrid instruments, excessive interest deductions, treaty shopping, and permanent establishment avoidance.

As part of its BEPS actions, the OECD published the “Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting” (“MLI”). The MLI seeks to incorporate agreed tax treaty-related measures combating tax avoidance into bilateral existing tax treaties without the need to negotiate new treaties. The MLI may apply to double tax treaties entered into by other countries in which we have operations (in some cases with effect from as early as January 2019).

The MLI entered into force for Ireland in May 2019, and became effective for withholding tax on January 1, 2020. The MLI changed Ireland's treaties by including a principal purpose test (“PPT”), which will disallow treaty benefits where it is reasonable to conclude that the main purpose or one of the main purposes of a transaction or arrangement is to obtain directly or indirectly the benefits of the treaty. Given the subjectivity of the PPT, there is a risk that each counterparty jurisdiction will interpret it differently, which creates uncertainty in its application to leasing and other arrangements. Until such time as countries develop guidance on how the test will be applied, it will be difficult to determine its effect on us.

Ireland did not adopt the MLI’s “dependent agent” permanent establishment threshold. Some countries could seek a bilateral re-negotiation on the point to change the dependent agent provisions in their tax treaty with Ireland. Any such change could take some time to be agreed and subsequently ratified before it could come into effect.

Further changes to tax law will be required in order to fully implement the BEPS action plans. Currently, it is difficult to determine what further BEPS actions the governments of lessee jurisdictions will implement. Depending on the nature of the BEPS action plans adopted, it may result in an increase in our effective tax rate and cash taxes liabilities in future periods.

It is expected that Pillar Two will increase the effective tax rate of the group.

On January 29, 2019, the OECD announced an initiative to create an international consensus on new rules (referred to as “BEPS 2.0”) for the framework governing international taxation, which was supported by the publication of the Pillar One and Pillar Two Blueprint Reports (the “Blueprints”) on October 12, 2020. The stated aim is to move beyond the arm’s length principle and the scope of current taxing rights are limited to businesses with a physical presence in a country. The new rules, if adopted, would readjust the balance of taxing rights and multinational companies (“MNC”) profit allocation between jurisdictions where MNC assets are owned and the markets where users and consumers are based.

On October 8, 2021, Ireland and Bermuda, approved a statement, known as the OECD BEPS Inclusive Framework (the “IF”), providing a framework for BEPS 2.0, which builds upon the Blueprints. The IF and revised Pillar Two Blueprint include a global minimum effective tax rate of 15% for groups with annual consolidated revenue in excess of €750 million, subject to certain exclusions. On December 12, 2022, the E.U. council unanimously agreed to allow E.U. countries until December 31, 2023 to adopt the Pillar 2 rules into domestic legislation. Further guidance is expected from

the OECD and the E.U. as to how certain aspects of the Pillar Two rules will operate mechanically, and as such it is difficult to determine the degree to which these changes may result in an increase in our effective tax rate and cash tax liabilities in future periods.

Ireland has enacted the E.U. Minimum Tax Directive into domestic legislation with effect from January 1, 2024. The legislation is largely in line with the E.U. Minimum Tax Directive and OECD Guidance. The implementation of these rules mean that the group must be taxed at a minimum effective tax rate of 15% as calculated under the Pillar 2 Global Anti-Base Erosion rules. Ireland will continue to apply the 12.5% corporation tax rate to companies with consolidated global turnover below this threshold. In Ireland, the E.U. Minimum Tax Directive has been implemented by means of a new top-up tax to achieve the effective rate of 15%. Any further guidance or directives issued by the OECD or the E.U. could alter the operation of this tax and could have an adverse impact on the group’s effective tax rate and cash tax liabilities in future periods.

The E.U. Anti-tax Avoidance proposals may impact our effective rate of tax in future periods.

The Council of the E.U. has implemented the E.U. Anti-Tax Avoidance Directives (“E.U. ATAD”) and the amending Directive (“E.U. ATAD 2”). These Directives seek to oblige all E.U. member states to introduce a number of anti-tax avoidance measures.

Most of the measures were implemented with effect from January 2019, though certain measures may have been deferred to 2024. The E.U. ATAD contemplates the introduction of a restriction on the deductibility of interest, measures in respect of certain hybrid transactions and instruments, an exit charge, a switch overrule, controlled foreign company rules as well as a general anti-avoidance rule.

The impact of the other measures in respect of certain hybrid transactions and instruments, an exit charge, a switch over rule, controlled foreign company rules as well as a general anti-avoidance rule will depend on the exact scope of these measures. The impact on the Company’s tax position (if any), will depend on the implementation of these measures in Ireland and other E.U. jurisdictions where we have operations.

The Irish Finance Bill published on October 21, 2021 included draft legislation to enact the interest limitation measures prescribed by the E.U. ATAD. The implementation date for the new law was January 1, 2022. Based on the final legislation in Finance Act 2021 signed into law on December 21, 2021, the interest limitation rule will apply to limit the deductibility of a company’s exceeding borrowing costs (i.e., its interest (and equivalent) borrowing costs as reduced by its interest (and equivalent) income) to 30% of tax adjusted EBITDA. Importantly for companies carrying on a leasing trade, a portion of their operating lease income and expense will be treated as equivalent to interest for the purposes of the test. The legislation was finalized on December 21, 2021 and Irish Revenue released guidance on the application of these rules on August 4, 2022, and updated guidance in February 2023. We currently do not expect these interest limitation rules to have a material impact on our financial position.

On December 22, 2021, the European Commission issued a proposal for a Council Directive laying down rules to prevent the misuse of shell entities for tax purposes within the E.U. (“E.U. ATAD 3”) and has since issued a number of draft amendments. On January 17, 2023, the European Parliament approved the report on the Unshell Proposal Directive. While E.U. ATAD 3 was initially expected to be adopted and published into E.U. member states’ national laws by June 30, 2023, and become effective as of January 1, 2024, there is considerable uncertainty surrounding the development of the proposal and its implementation. The proposal is subject to a consultation procedure and, in its final form, will require the unanimous approval of the E.U. Council before it is adopted. Until the proposal receives approval and a final Directive is published, it is not possible to provide definitive guidance on the impact of the proposals for us. However, at a minimum, the proposal could result in additional reporting and disclosure obligations for us.

On May 11, 2022, the European Commission issued a proposal for a Council Directive laying down rules providing for a debt-equity bias reduction allowance within the E.U. (“DEBRA”). DEBRA is intended to provide a notional interest deduction in respect of equity invested in a company, with the interest calculated based on the 10-year risk-free rate for the relevant currency, with the maximum deduction available limited to 30% of earnings before interest, tax, depreciation and amortization. At the E.U. Economic and Financial Affairs Council meeting on December 6, 2022, it was agreed that the examination of the DEBRA proposal should be suspended until other proposals in the area of corporate income tax have been put forward. Therefore, it is not clear if DEBRA will be enacted into legislation but, if it is, DEBRA could result in additional reporting and disclosure obligations.

On December 10, 2024 the E.U. Council adopted the proposal on the Faster and Safer Tax Relief of Excess Withholding Taxes (“FASTER”) Directive. The FASTER Directive applies to dividends from publicly traded shares and, where applicable, interest from publicly traded bonds paid to registered owners who are resident for tax purposes outside a given E.U. Member State. The FASTER Directive is expected to be published in the E.U. Official Journal in 2025, and Member States will be required to transpose the Directive into national law by December 31, 2028, with the rules becoming applicable as of January 1, 2030. Until final Irish implementing legislation is published, it is not possible to provide definitive guidance on the impact, if any, of the FASTER Directive.

We operate in multiple jurisdictions and may become subject to a wide range of income and other taxes that could have a material adverse effect on our financial condition, cash flow and results of operations.

We operate in multiple jurisdictions and may become subject to a wide range of income and other taxes. If we are unable to execute our operations on a tax-efficient basis in these jurisdictions, our operations may be subject to significant income and other taxes. Moreover, as our aircraft are operated by our lessees in multiple jurisdictions, we may have nexus or taxable presence as a result of our aircraft operating in various jurisdictions. Such operations may result in us being subject to various foreign, state and local taxes in such jurisdictions. Our leases typically require our lessees to indemnify us in respect of any such taxes but if any lease does not require such indemnification or if any lessees fail to make such indemnification, our financial condition, cash flow and results of operations could be materially adversely affected if we become subject to significant income and other taxes that we are not currently subject to.

Due to the nature of our operations, our tax affairs are open to review and challenge by the tax authorities throughout the world. We are subject to routine tax audits by local authorities. Ongoing and future tax audits may result in additional tax and interest payments, which could negatively affect our financial condition and results of operations.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 1C. CYBERSECURITY

Our cybersecurity program includes the assessment, identification and management of material risks from cybersecurity threats (as defined in Item 106(a) of Regulation S-K). To identify and assess material risks from cybersecurity threats, our annual enterprise risk management assessment considers risks from cybersecurity threats alongside other risks as part of our overall risk assessment process. In addition, we engage with consultants, internal and external auditors and other third parties to gather certain insights designed to identify and assess material risks from cybersecurity threats, their severity and potential mitigations. We also employ a range of tools and services, depending on the environment, including network and endpoint monitoring, malware detection, vulnerability assessments, cloud penetration testing, threat hunting and incident responsiveness, as well as tabletop exercises, to inform our cybersecurity risk identification and assessment. As part of our cybersecurity program, we maintain an incident response plan that includes processes to assess the severity of, escalate, contain, investigate and remediate cybersecurity incidents. We also have risk management processes to oversee and help identify risks from cybersecurity threats associated with our use of third-party service providers.

Our Board of Directors has delegated oversight of our cybersecurity program, which includes oversight of cybersecurity threats, to the Risk and Governance Committee. Throughout the year, at each quarterly Risk and Governance Committee meeting, or as needed, the committee is updated on IT security by senior management, including industry IT breaches, cybersecurity incidents and employee cybersecurity training. Our SVP, IT Operations & Security, is a Certified Information Systems Security Professional who has provided technology-related infrastructure and application management services for over 25 years and is responsible for day-to-day assessment and management of our information systems and cybersecurity program. Our SVP, IT Operations and Security, reports directly to our Chief Financial Officer.

To date, cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected and, we believe, are not reasonably likely to materially affect the Company, including its business strategy, results of operations or financial condition. For additional description of risks from cybersecurity threats and potential related impacts on the Company, see our risk factors under Part 1. Item 1A. Risk Factors in this Annual Report on Form

10-K, including “We are dependent upon information technology systems, which are subject to disruption, damage, failure and risks associated with implementation and integration.”

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