Willis Lease Finance Closes Series B Preferred Stock Private Placement

What Happened

• Willis Lease Finance Corporation announced it closed a private placement on September 29, 2026, selling 1,750,000 shares of newly created Series B Preferred Stock to Development Bank of Japan Inc. (DBJ) at $20.00 per share. The Board approved related Certificates of Designations and amendments to the Series A and Series B preferred stock terms, and formal filings with the Delaware Secretary of State were made between September 24 and September 30, 2026.

Key Details

• Purchase: 1,750,000 Series B shares sold to DBJ at $20.00 per share (closed Sept. 29, 2026).
• Dividend & preference: Series B pays an 8.09% annual dividend and had a $20.00 liquidation preference per share (reduced to one‑third after a 3‑for‑1 forward split).
• Forward split: The Board authorized a 3-for-1 forward split for both Series A and Series B preferred shares (Series B authorized increased from 1,750,000 to 5,250,000; Series A from 3,250,000 to 9,750,000), with split-related amendments effective Sept. 30, 2026.
• Control & rights: DBJ is the sole holder of Series A and Series B; Series B generally has no voting rights but holders can elect up to two directors if dividends are in arrears for six dividend periods. Series B is non-convertible.
• Protective provisions: While any Series B shares are outstanding, the Company generally cannot create or issue senior or pari passu stock, increase Series B shares, or materially change holders’ rights without consent of holders of at least two-thirds of Series B.
• Redemption option: Holders (Required Majority) may require redemption for cash (liquidation preference plus accrued unpaid dividends) on 90 days’ notice starting Sept. 29, 2031 or upon certain specified events.

Why It Matters

• Capital structure and claims on assets: The new Series B issuance creates a preferred-class creditor/owner with an 8.09% dividend and liquidation priority senior to common stock (subject to parity protections). That affects the priority of claims in a liquidation scenario relative to common shareholders.
• Economic impact and timelines: The preferred carries a fixed dividend obligation and a potential redemption date starting in 2031, which are ongoing cash/structural considerations for the company and common shareholders. The 3-for-1 split increases the number of preferred shares while proportionally reducing per-share liquidation preference—changing share counts but not aggregate economic terms.
• Governance and control: Because DBJ holds all Series A and Series B shares, it has concentrated influence over parity decisions and could gain limited board representation if preferred dividends go unpaid. This is a material governance detail for investors assessing voting influence and downside protections.