AIG 2011 Annual Report Download - page 322

American International Group, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
basis points resulting in an interest rate of 2.44 percent. As of December 31, 2011, ILFC had paid down
$2.0 billion of this revolving credit facility. The amended facility prohibits ILFC from re-borrowing amounts repaid
under this facility for any reason; therefore, the size of the outstanding facility and the total funded amount under
the credit facility was $457 million at December 31, 2011. The interest rate of the credit facility was 2.44 percent
at December 31, 2011.
At December 31, 2011, AeroTurbine Inc., a wholly-owned subsidiary of ILFC, had a balance of $269 million on
its secured four-year credit facility. The maturity of the credit facility is December 2015 and the interest rate is
3.28 percent. ILFC is a guarantor under the four-year credit facility.
In addition, at December 31, 2011, ILFC has other secured financings of approximately $6.7 billion that mature
through 2018, with interest rates ranging from 3.33 percent to 7.13 percent.
On August 20, 2010, ILFC issued $1.35 billion aggregate principal amount of 6.5 percent senior secured notes
due September 1, 2014, $1.275 billion of aggregate principal amount of 6.75 percent senior secured notes due
September 1, 2016, and $1.275 billion of aggregate principal amount of 7.125 percent senior secured notes due
September 1, 2018. The proceeds from these debt issuances were used to repay loans from AIG, and then used by
AIG to reduce the principal amount outstanding under the FRBNY Credit Facility.
On March 17, 2010, ILFC entered into a $750 million term loan agreement secured by 43 aircraft and all
related equipment and leases. The loan matures on March 17, 2015, and bears interest at LIBOR plus a margin of
4.75 percent with a LIBOR floor of 2.0 percent. The principal of the loan is payable in full at maturity with no
scheduled amortization; however, ILFC has the right to voluntarily prepay the loan at any time. On March 17,
2010, ILFC also entered into an additional term loan agreement of $550 million, of which $63 million is subject to
the satisfaction of certain collateralization milestones. The loan is secured by 37 aircraft and all related equipment
and leases. The loan matures on March 17, 2016, and bears interest at LIBOR plus a margin of 5.0 percent with a
LIBOR floor of 2.0 percent. The principal of the loan is payable in full at maturity with no scheduled
amortization; however, ILFC has the right to voluntarily prepay the loan at any time, subject to a 1.0 percent
prepayment penalty prior to March 17, 2012.
AIG does not guarantee any of the debt obligations of ILFC.
Uncollateralized and collateralized notes, bonds, loans and mortgages payable consisted of the following:
At December 31, 2011 Uncollateralized Collateralized
Notes/Bonds/Loans Loans and
(in millions) Payable Mortgages Payable Total
AIG general borrowings $ 234 $ - $ 234
Other subsidiaries notes, bonds, loans and mortgages payable* 105 288 393
Total $ 339 $ 288 $ 627
* AIG does not guarantee any of these borrowings.
In the normal course of business, various commitments and contingent liabilities are entered into by AIG and
certain of its subsidiaries. In addition, AIG guarantees various obligations of certain subsidiaries.
Although AIG cannot currently quantify its ultimate liability for unresolved litigation and investigation matters,
including those referred to below, it is possible that such liability could have a material adverse effect on AIG’s
consolidated financial condition or its consolidated results of operations or consolidated cash flows for an
individual reporting period.
308 AIG 2011 Form 10-K
16. COMMITMENTS, CONTINGENCIES AND GUARANTEES